would employ a vast portion of capital and labour, it would be so far from taking them from more profitable employment, that it would take them from a state of idleness, or something worse, to the great benefit of the whole capital and labour of the country. The case, with variations in degree, is always the same.

The uncouth inconsistency of the Economists in virtually proclaiming, in the same breath, that labour will never want profitable employment, if rulers do not attempt to employ it; and that population continually outstrips the means of subsistence, or, in other words, labour increases more rapidly than employment, ought not to be overlooked.

A bounty creates a trade which otherwise could not exist, and in consequence, it gives to all the divisions of the community a portion of business and employment which they otherwise could not possess. Suppose that one of ten per cent will create an export trade amounting to two millions annually. It will cause the principal part of this sum-I will assume L.1,500,000 of it-to be expended amidst the different divisions more than would be, if the trade did not exist; and it will cause the divisions to raise their expenditure with each other. It will keep many thousand additional acres of land in cultivation, and provide a market for a large additional quantity of cottons, woollens, and other commodities.

The bounty here will be L.200,000 per annum. Putting the Irish population, on account of its circumstances, out of sight, and taking that of Britain at fifteen millions, it will, on the average, impose a tax on each soul of about threepence farthing per annum. As the labouring classes pay much less in proportion than the others, it will not perhaps amidst them take more than a penny or twopence from each soul. The bounty must cause three or four hundred thousand pounds to be expended in wages amidst these classes, and the greater part of it will be clear gain to them; in addition, it must cause general wages to be somewhat higher. If the agriculturists, manufacturers, &c. have to contribute in the year sixpence or a shilling each, they must draw from it infinitely more

than this sum in enlarged trade and better prices.

Granting that, if this sum of L. 200,000 were not paid in bounty, it would be expended in consumption, still it would only produce a trade of its amount, instead of one of nearly L.2,000,000. By being paid in bounty, it is still expended in raising the trade of this country, with this difference, that it causes foreigners to expend in the same manner six or seven times its amount. By paying it in bounty, each individual will be enabled to consume much more than he could do, should he expend it in consumption.

Taking the population of the united kingdom in round numbers at only twenty millions, if a million per annum be paid in bounties, it will only, on the average, take a shilling per annum from each individual; it will perhaps only take sixpence amidst the working classes. Suppose that two millions are paid yearly in bounties, which average ten per cent, this will create a new mass of trade, amounting to twenty millions, and which will support not much less than a million of souls, including women and children.

Assuming that such a trade should be at this moment created, and that, directly and indirectly, it should employ a million of souls, what would be its effects? These souls would receive much less from the poor-rates, and contribute much more to the taxes, than they now do. Practically, by this, they would contribute a pound per annum each to the bounty; they would pay half of it. It would raise wages generally, and to a great extent; it would raise them one-third or one-fourth. This would add greatly to the revenue.

The labouring classes, demonstrably, would receive infinitely more through the bounty, than it would take from them.

The agriculturists, manufacturers, &c. demonstrably, would have their burdens, in respect of poor-rates, greatly reduced, and their trade and profits greatly enlarged. They, too, would receive much more from the bounty, than it would take from them.

The difference between moderate prosperity and suffering, makes a

difference of at least two millions per annum in the revenue. Such a trade would, at the least, add to the revenue two millions-the whole amount of the bounty-yearly. In reality, the taxes would not be heavier-to the great body of the population they would be far lighter-with the bounty, than they are without it. No additional taxes would be necessary. But granting that it would be requisite to impose new taxes to the whole amount of the bounty, they would only take from each individual two shillings per annum. Whether the trade would be worth the purchasemoney, is a matter which I need not further determine.

With regard to the second case. Suppose that from war, taxes, the improvements of foreigners, &c. other nations could undersell England in the cotton trade, and that she could not retain her export of cottons without the aid of bounty. The loss of this export trade would not only deprive a great portion of capital and labour of employment, but it would involve the whole cotton manufacture in distress. It would largely diminish the import of cotton, the export of goods to buy it with, the trade of the makers of machinery, &c. &c. Assuming that this trade would amount to ten millions annually, and that it could not be preserved without a bounty of twenty per cent, or two millions, the question is, would it yield a profit to England of more than two millions annually? I have said sufficient to answer it; but I will add, that the loss of this trade would, by its effect on general profits and wages, subject the community to a yearly loss of more than either two or ten millions.

Bounties are precisely, in both principle and real operation, what protecting duties are. They impose a direct tax on the community, but do not, except in particular cases, raise to it the commodities they are connected with; protecting duties impose no direct tax, but they raise prices, and this is equivalent to the imposition of one; in effect, they tax the community quite as much as bounties. Every trade, therefore, which is carried on by means of protecting duty, has just as much effect in putting capital and labour into a wrong channel, and is just as much

a losing one, as that is which is carried on by means of bounty. Yet while protecting duties of thirty or forty per cent are held to be just and reasonable, bounties of ten or even five per cent are declaimed against as pernicious. Mr V. Fitzgerald, in the last Session, oracularly stated in the House of Commons, that it would be in vain to attempt to lead this House back to bounties:

this was said by the advocate of protecting duties to those who impose them, and it proves that neither he nor his auditors understood what he was speaking of. Even the Economists admit, that, in certain cases, such duties are equitable and beneficial; but they cannot, in any case, tolerate bounties.

Suppose that there are two trades, the one depending on export, and the other on home consumption, and that, from the increase of taxes, foreigners are enabled to undersell them-In this case, according to the prevailing doctrines, the one is to be destroyed, and the other is to be preserved, by a practical tax, although both are equally valuable to the community. Or at any rate, the one is to have protection, and the other is not. The real principle here isIn proportion as you are injured by increase of taxation, you ought to be further injured by the loss of your foreign trade: It ought to be your study, to enable taxation to do you the greatest possible injury.

Bounties thus are to the foreign what protecting duties are to the home trade; and they are not less equitable and beneficial than such duties. They may be employed in many ways with great advantage.

In late years, foreign linens have supplanted British ones, not only in foreign markets, but in those of our own colonies. In a case like this, bounty might regain the lost trade, and in so doing, it would serve, not the manufacturers alone, but the producers and dressers of flax, &c.

At this moment our American Colonies declare, that they are almost wholly driven out of foreign markets, in regard to the sale of their fish. A bounty could regain them these markets; and by this it would not only give them prosperity, but add considerably to the foreign, colonial, and domestic trade of the mother coun

try. The principal part of the money obtained for their fish would be expended with the latter and the other Colonies.

The sugar Colonies are losing their foreign markets. In a case like this, bounty would enable them to produce more and obtain better prices; and, in consequence, they would employ more shipping, and buy far more manufactured goods of the mother

country.

Bounties, in many cases, could be beneficially employed in giving new staples to the Colonies. Every thing which gives prosperity to the latter, adds greatly to the general trade at home. The colonial trade, however, like the home trade, is looked on as worthless. Such a small colony as the Cape of Good Hope buys as much of this country as some foreign nations; and its trade, in respect of profit, is worth more than three times its amount-I might almost say ten times-of foreign trade; but it is treated as below notice. Judicious measures could, in a very short period of time, add some millions annually to the sales of this country to its Colonies.

Bounties are not necessarily to be granted permanently; they must be granted on sufficient cause, and expire with it. When properly regulated, it may be safely taken as a principle that they will put as much money into the Exchequer as they will take out of it, and that they will, beside, increase the prosperity and comfort of the community.

Every man knows that it makes not the least practical difference to him whether the annual taxes be L.100,000 or L.500,000, more or less. Yet, according to the absurd notions of economy which now prevail, a saving of L.50,000, or L.100,000,-one which no man can feel-is to be made by the abolition of bounties, though it distress or destroy a whole trade. To effect worthless savings like this, the community is subjected to a loss of millions.

I have said sufficient to shew the true character of the horror with which the House of Commons regards bounties, and to prove that the horror flows from the gross, disgraceful, guilty ignorance which prevails in this House touching matters

of trade.

I now proceed to the general summing up; it is, in the first place, of the highest importance to ascertain what the British empire depends on for wealth and prosperity.

Mr Huskisson and the advocates of Free Trade practically, and even in terms, assert that it depends on foreign commerce. To the latter they make every thing subservient. They insist that buying of, and selling to foreign nations without any regard to commodity, is the grand source of national riches; and that every restraint on buying ought to be removed, as the only means of carrying selling to the maximum. In reality, they make the wealth and prosperity of the empire dependent on unlimited freedom to buy all kinds of commodities of foreign countries.

If the population of this empire be wholly or principally engaged in foreign commerce, they unquestionably maintain the truth; if not, they must of necessity be in error.

To such places as Hamburgh and Bremen, Free Trade must be highly beneficial. Why? Their inhabitants are directly and indirectly employed in trading between one foreign nation and another; they produce little, save ships, which cannot be undersold, therefore they have nothing to lose from competition. Having, comparatively, nothing to do with agriculture and manufactures, and dependent chiefly on employment as merchants and carriers to foreign nations, unlimited freedom of buying and selling must enlarge their domestic as well as their foreign trade.

Are the inhabitants of the British empire so employed? No. More than half of them are engaged in agriculture, and the principal part of the remainder are engaged in such manufactures and domestic trade as have little connexion with foreign commerce. Their employment, as a whole, is of a directly opposite character.

Foreign commerce can only be a good in so far as it increases the ge neral business, profits and wages of the mass of the population; in so far as it diminishes them, it must of necessity be a great evil. In places like Hamburgh, which depend mainly upon it, every thing ought to be

made subservient to it; but in great empires like the British one, which depend principally on production, and on production for their own consumption, it ought on the same ground to be made strictly subservient to the general business carried on by the great body of the population of Britain; therefore employing foreign ships, and buying foreign corn, silks, &c., distress the majority of her inhabit ants; and such foreign trade must demonstrably do her incalculable injury. Her foreign trade, to benefit her, must benefit her agriculture, manufactures, and home and colonial trade generally; and it must be prohibited by law from receiving the least extension in any part that will injure them. It is dependent upon, and it cannot injure, without suffering with them. It is a thing of secondary importance-a mere auxiliary.

Britain scrupulously acted upon this previously to late years. She made her foreign trade subservient to her general, domestic, and colonial trade, as far as possible. When It could benefit the generality of her inhabitants, without injuring materially any part; or when it could benefit a part, without injuring the remainder, she warmly encouraged it; but beyond this, she placed it under prohibition. As far as it was a good she cherished it, but when it became an evil, she put it under the ban of her laws; she would not suffer a part of her population to use it as the means for distressing the other part, and in consequence the whole. It was through this wise policy that she made it a leading source of riches and prosperity.

Her ministers and legislators in late years have declared that she is like such places as Hamburgh, dependent principally on foreign trade; and in consequence, that it is as beneficial for her to buy foreign corn and manufactures, as to buy cotton and indigo-that such foreign trade as will distress half her population will be not less advantageous to her than such as will yield profit to the whole. They have avowedly made it a system to diminish and injure, in the most grievous manner, the trade of the great majority of her inhabitants, in order to increase the foreign trade of the minority. Never

before was such a portentous error fallen into in a civilized nation.

After ample trial, what are the fruits of this system? It has produced all the intended evil, but none of the good. It has contracted the trade of the majority, and plunged it into misery; but it has not increa sed the foreign trade of the minority. To the latter, it has destroyed trade in the home market, without extending it in the foreign one. It has driven a vast portion of capital and labour out of employment in some trades, but it has not provided them with it in others; on the contrary, it has either destroyed the capital, or rendered it idle, and thrown the labour on the poor-rates for subsistence.

Common reason may convince any man that the system cannot produce other than such fruits. These matters must be evident to all: 1. That it must grievously injure much more than half the population. 2. That it must greatly reduce the foreign trade, which depends on the latter. And 3. That it cannot, on the whole, give the manufacturers a greater command over foreign markets, by enabling them to cheapen their goods; such goods are, and will be, excluded by most foreign nations by law; and, according to the evidence of all sides, these nations are rapidly improving in manufactures, and will, at any rate, manufacture for their own consumption.

Britain thus depends in only a comparatively small degree on foreign trade for wealth and prosperity: her dependence rests príncipally on her agriculture and home and colonial trades, and of course it ought to be her constant endeavour to protect and extend these to the utmost: in so far as she may do this, she will really protect and extend her foreign commerce.

Her two great wants at present are-employment for capital and labour, and adequate profits and wages. Whatever would supply these wants would give her wealth and prosperity.

This will be disputed by none. What would supply them? The first would be removed by a sufficient enlargement of her great sources of employment for capital and labour. This cannot be controverted.

It is proved, both by the nature of

things and decisive experiments, that these sources are narrowed, but not enlarged, by the present system, what change then ought to be adopted? The question relates not to comparative degrees of prosperity; it involves the decision between salvation and ruin.

From what I have stated in my former letters, I maintain, speaking generally, that in this country price consists partly of taxes, duties, and rates-partly of the interest of fixed or vested capital, looking at it as a separate kind of profit-partly of wages-partly of capital paid for raw produce, &c.-and partly of profit on circulating capital.

If wages rise, it will not raise the taxes, &c., or the interest of fixed capital, and it will not increase the amount of capital paid for foreign produce, &c.; in consequence, an advance of price much less in proportion than that of wages will be sufficient to keep profits from reduction. Wages and profits can rise and fall together.

Instead of consisting solely of wages and profits, price thus consists of wages and profits on the one part, and of taxes, duties, rates and capital paid to foreign countries on the other. Dividing it into these two parts, a rise or fall in the one is a fall or rise in the other. A rise of wages and profits is a reduction of taxes, duties, rates, and the cost of foreign commodities; and vice versa. A fall of general prices in this country cannot of itself reduce the taxes, &c., therefore it must take effect almost exclusively on wages and profits. If the price of an article consist one-half of the latter and one-half of taxes, &c., and be reduced 25 per cent, wages and profits, in respect of this article, will be reduced 50 per cent. Assuming prices, on the average, to consist in this manner, a general fall in them of 25 per cent will take from wages and profits jointly, 50 per cent, and will take 25 per cent from the exchangeable value of the latter. If such a fall of prices be not accompanied with a corresponding reduction of taxes, &c., it must really make commodities 25 per cent dearer to the great body of consumers. To this body the lowest money prices must be the highest real ones-scarcity and fa

mine; and the highest money prices must be the lowest real ones-prosperity and abundance.

While wages and profits must thus rise and fall with money prices, the rise and fall, but especially the latter, must take effect principally on wages. The net profit on commodities generally does not amount to more than 10 per cent; if 25 per cent be taken from their prices, the capitalists must still have some net profit; assuming that they sacrifice 5 per cent, and that one-half of prices consists of wages and profits, wages must be reduced 45 per cent.

Money is not produced by labour as commodities are. The general property which it represents is composed of accumulated profits. These profits do not consist, in any degree, of wages; but in so far as they arise from, they are a per centage on, them. The cost of producing them is not therefore necessarily raised by a rise of wages. On the contrary, they may be the highest, or, in other words, the cost of producing them may be the lowest, when wages are the highest; and a rise of wages, when it raises commodities, adds prodigiously to the amount of the accumulated profits of a country, by raising the value of the property they have been converted into.

Money, in the abstract, is an arithmetical, immutable measure of value. If substance be given to it in the shape of coin, the value of the latter is intended to be as far as possible unalterable, and above the influence of variations in the price of labour. Coin, in so far as it falls short of this, is confessedly imperfect money; it is, in its nature, precisely what the bushel, the gallon, and other measures are. It would be as correct, to assert that the size of the bushel ought to be enlarged or diminished in proportion with advances and reduction in the price of corn; as to assert, that the value of coin ought to vary with the prices of general commodities. If it be true, that coin or money must rise with commodities, it must of necessity be equally true, that it must fall with them-that when they sink in price, coin or money must sink equally: yet the Economists in effect commit the inconsistency of maintaining, that it must rise, but cannot fall, with