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CHAPTER IX
Of the Agricultural Systems, or of those Systems of Political Economy which
represent the Produce of Land as either the sole or the principal Source
of the Revenue and Wealth every Country
THE agricultural systems of political economy will not require so long
an explanation as that which I have thought it necessary to bestow upon
the mercantile or commercial system. That system which represents the produce
of land as the sole source of the revenue and wealth of every country has,
so far as I know, never been adopted by any nation, and it at present exists
only in the speculations of a few men of great learning and ingenuity in
France. It would not, surely, be worth while to examine at great length
the errors of a system which never has done, and probably never will do,
any harm in any part of the world. I shall endeavour to explain, however,
as distinctly as I can, the great outlines of this very ingenious system.
Mr. Colbert, the famous minister of Louis XIV, was a man of probity, of
great industry and knowledge of detail, of great experience and acuteness
in the examination of public accounts, and of abilities, in short, every
way fitted for introducing method and good order into the collection and
expenditure of the public revenue. That minister had unfortunately embraced
all the prejudices of the mercantile system, in its nature and essence
a system of restraint and regulation, and such as could scarce fail to
be agreeable to a laborious and plodding man of business, who had been
accustomed to regulate the different departments of public offices, and
to establish the necessary checks and controls for confining each to its
proper sphere. The industry and commerce of a great country he endeavoured
to regulate upon the same model as the departments of a public office;
and instead of allowing every man to pursue his own interest in his own
way, upon the liberal plan of equality, liberty, and justice, he bestowed
upon certain branches of industry extraordinary privileges, while he laid
others under as extraordinary restraints. He was not only disposed, like
other European ministers, to encourage more the industry of the towns than
that of the country; but, in order to support the industry of the towns,
he was willing even to depress and keep down that of the country. In order
to render provisions cheap to the inhabitants of the towns, and thereby
to encourage manufactures and foreign commerce, he prohibited altogether
the exportation of corn, and thus excluded the inhabitants of the country
from every foreign market for by far the most important part of the produce
of their industry. This prohibition, joined to the restraints imposed by
the ancient provincial laws of France upon the transportation of corn from
one province to another, and to the arbitrary and degrading taxes which
are levied upon the cultivators in almost all the provinces, discouraged
and kept down the agriculture of that country very much below the state
to which it would naturally have risen in so very fertile a soil and so
very happy a climate. This state of discouragement and depression was felt
more or less in every different part of the country, and many different
inquiries were set on foot concerning the causes of it. One of those causes
appeared to be the preference given, by the institutions of Mr. Colbert,
to the industry of the towns above that of the country. If the rod be bent
too much one way, says the proverb, in order to make it straight you must
bend it as much the other. The French philosophers, who have proposed the
system which represents agriculture as the sole source of the revenue and
wealth of every country, seem to have adopted this proverbial maxim; and
as in the plan of Mr. Colbert the industry of the towns was certainly overvalued
in comparison with that of the country; so in their system it seems to
be as certainly undervalued. The different orders of people who have ever
been supposed to contribute in any respect towards the annual produce of
the land and labour of the country, they divide into three classes. The
first is the class of the proprietors of land. The second is the class
of the cultivators, of farmers and country labourers, whom they honour
with the peculiar appellation of the productive class. The third is the
class of artificers, manufacturers, and merchants, whom they endeavour
to degrade by the humiliating appellation of the barren or unproductive
class. The class of proprietors contributes to the annual produce by the
expense which they may occasionally lay out upon the improvement of the
land, upon the buildings, drains, enclosures, and other ameliorations,
which they may either make or maintain upon it, and by means of which the
cultivators are enabled, with the same capital, to raise a greater produce,
and consequently to pay a greater rent. This advanced rent may be considered
as the interest or profit due to the proprietor upon the expense or capital
which he thus employs in the improvement of his land. Such expenses are
in this system called ground expenses (dépenses foncières.)
The cultivators or farmers contribute to the annual produce by what are
in this system called the original and annual expenses (dépenses
primitives et dépenses annuelles) which they lay out upon the
cultivation of the land. The original expenses consist in the instruments
of husbandry, in the stock of cattle, in the seed, and in the maintenance
of the farmer's family, servants, and cattle during at least a great part
of the first year of his occupancy, or till he can receive some return
from the land. The annual expenses consist in the seed, in the wear and
tear of the instruments of husbandry, and in the annual maintenance of
the farmer's servants and cattle, and of his family too, so far as any
part of them can be considered as servants employed in cultivation. That
part of the produce of the land which remains to him after paying the rent
ought to be sufficient, first, to replace to him within a reasonable time,
at least during the term of his occupancy, the whole of his original expenses,
together with the ordinary profits of stock; and, secondly, to replace
to him annually the whole of his annual expenses, together likewise with
the ordering profits of stock. Those two sorts of expenses are two capitals
which the farmer employs in cultivation; and unless they are regularly
restored to him, together with a reasonable profit, he cannot carry on
his employment upon a level with other employments; but, from a regard
to his own interest, must desert it as soon as possible and seek some other.
That part of the produce of the land which is thus necessary for enabling
the farmer to continue his business ought to be considered as a fund sacred
to cultivation, which, if the landlord violates, he necessarily reduces
the produce of his own land, and in a few years not only disables the farmer
from paying this racked rent, but from paying the reasonable rent which
he might otherwise have got for his land. The rent which properly belongs
to the landlord is no more than the net produce which remains after paying
in the completest manner all the necessary expenses which must be previously
laid out in order to raise the gross or the whole produce. It is because
the labour of the cultivators, over and above paying completely all those
necessary expenses, affords a net produce of this kind that this class
of people are in this system peculiarly distinguished by the honourable
appellation of the productive class. Their original and annual expenses
are for the same reason called, in this system, productive expenses, because,
over and above replacing their own value, they occasion the annual reproduction
of this net produce. The ground expenses, as they are called, or what the
landlord lays out upon the improvement of his land, are in this system,
too, honoured with the appellation of productive expenses. Till the whole
of those expenses, together with the ordinary profits of stock, have been
completely repaid to him by the advanced rent which he gets from his land,
that advanced rent ought to be regarded as sacred and inviolable, both
by the church and by the king; ought to be subject neither to tithe nor
to taxation. If it is otherwise, by discouraging the improvement of land
the church discourages the future increase of her own tithes, and the king
the future increase of his own taxes. As in a well-ordered state of things,
therefore, those ground expenses, over and above reproducing in the completest
manner their own value, occasion likewise after a certain time a reproduction
of a net produce, they are in this system considered as productive expenses.
The ground expenses of the landlord, however, together with the original
and the annual expenses of the farmer, are the only three sorts of expenses
which in this system are considered as productive. All other expenses and
all other orders of people, even those who in the common apprehensions
of men are regarded as the most productive, are in this account of things
represented as altogether barren and unproductive. Artificers and manufacturers
in particular, whose industry, in the common apprehensions of men, increases
so much the value of the rude produce of land, are in this system represented
as a class of people altogether barren and unproductive. Their labour,
it is said, replaces only the stock which employs them, together with its
ordinary profits. That stock consists in the materials, tools, and wages
advanced to them by their employer; and is the fund destined for their
employment and maintenance. Its profits are the fund destined for the maintenance
of their employer. Their employer, as he advances to them the stock of
materials, tools, and wages necessary for their employment, so he advances
to himself what is necessary for his own maintenance, and this maintenance
he generally proportions to the profit which he expects to make by the
price of their work. Unless its price repays to him the maintenance which
he advances to himself, as well as the materials, tools, and wages which
he advances to his workmen, it evidently does not repay to him the whole
expense which he lays out upon it. The profits of manufacturing stock therefore
are not, like the rent of land, a net produce which remains after completely
repaying the whole expense which must be laid out in order to obtain them.
The stock of the farmer yields him a profit as well as that of the master
manufacturer; and it yields a rent likewise to another person, which that
of the master manufacturer does not. The expense, therefore, laid out in
employing and maintaining artificers and manufacturers does no more than
continue, if one may say so, the existence of its own value, and does not
produce any new value. It is therefore altogether a barren and unproductive
expense. The expense, on the contrary, laid out in employing farmers and
country labourers, over and above continuing the existence of its own value,
produces a new value, the rent of the landlord. It is therefore a productive
expense. Mercantile stock is equally barren and unproductive with manufacturing
stock. It only continues the existence of its own value, without producing
any new value. Its profits are only the repayment of the maintenance which
its employer advances to himself during the time that he employs it, or
till he receives the returns of it. They are only the repayment of a part
of the expense which must be laid out in employing it. The labour of artificers
and manufacturers never adds anything to the value of the whole annual
amount of the rude produce of the land. It adds, indeed, greatly to the
value of some particular parts of it. But the consumption which in the
meantime it occasions of other parts is precisely equal to the value which
it adds to those parts; so that the value of the whole amount is not, at
any one moment of time, in the least augmented by it. The person who works
the lace of a pair of fine ruffles, for example, will sometimes raise the
value of perhaps a pennyworth of flax to thirty pounds sterling. But though
at first sight he appears thereby to multiply the value of a part of the
rude produce about seven thousand and two hundred times, he in reality
adds nothing to the value of the whole annual amount of the rude produce.
The working of that lace costs him perhaps two years' labour. The thirty
pounds which he gets for it when it is finished is no more than the repayment
of the subsistence which he advances to himself during the two years that
he is employed about it. The value which, by every day's, month's, or year's
labour, he adds to the flax does no more than replace the value of his
own consumption during that day, month, or year. At no moment of time,
therefore, does he add anything to the value of the whole annual amount
of the rude produce of the land: the portion of that produce which he is
continually consuming being always equal to the value which he is continually
producing. The extreme poverty of the greater part of the persons employed
in this expensive though trifling manufacture may satisfy us that the price
of their work does not in ordinary cases exceed the value of their subsistence.
It is otherwise with the work of farmers and country labourers. The rent
of the landlord is a value which, in ordinary cases, it is continually
producing, over and above replacing, in the most complete manner, the whole
consumption, the whole expense laid out upon the employment and maintenance
both of the workmen and of their employer. Artificers, manufacturers, and
merchants can augment the revenue and wealth of their society by parsimony
only; or, as it in this system, by privation, that is, by depriving themselves
a part of the funds destined for their own subsistence. They annually reproduce
nothing but those funds. Unless, therefore, they annually save some part
of them, unless they annually deprive themselves of the enjoyment of some
part of them, the revenue and wealth of their society can never be in the
smallest degree augmented by means of their industry. Farmers and country
labourers, on the contrary, may enjoy completely the whole funds destined
for their own subsistence, and yet augment at the same time the revenue
and wealth of their society. Over and above what is destined for their
own subsistence, their industry annually affords a net produce, of which
the augmentation necessarily augments the revenue and wealth of their society.
Nations therefore which, like France or England, consist in a great measure
of proprietors and cultivators can be enriched by industry and enjoyment.
Nations, on the contrary, which, like Holland and Hamburg, are composed
chiefly of merchants, artificers, and manufacturers can grow rich only
through parsimony and privation. As the interest of nations so differently
circumstanced is very different, so is likewise the common character of
the people: in those of the former kind, liberality, frankness and good
fellowship naturally make a part of that common character: in the latter,
narrowness, meanness, and a selfish disposition, averse to all social pleasure
and enjoyment. The unproductive class, that of merchants, artificers, and
manufacturers, is maintained and employed altogether at the expense of
the two other classes, of that of proprietors, and of that of cultivators.
They furnish it both with the materials of its work and with the fund of
its subsistence, with the corn and cattle which it consumes while it is
employed about that work. The proprietors and cultivators finally pay both
the wages of all the workmen of the unproductive class, and of the profits
of all their employers. Those workmen and their employers are properly
the servants of the proprietors and cultivators. They are only servants
who work without doors, as menial servants work within. Both the one and
the other, however, are equally maintained at the expense of the same masters.
The labour of both is equally unproductive. It adds nothing to the value
of the sum total of the rude produce of the land. Instead of increasing
the value of that sum total, it is a charge and expense which must be paid
out of it. The unproductive class, however, is not only useful, but greatly
useful to the other two classes. By means of the industry of merchants,
artificers, and manufacturers, the proprietors and cultivators can purchase
both the foreign goods and the manufactured produce of their own country
which they have occasion for with the produce of a much smaller quantity
of their own labour than what they would be obliged to employ if they were
to attempt, in an awkward and unskilful manner, either to import the one
or to make the other for their own use. By means of the unproductive class,
the cultivators are delivered from many cares which would otherwise distract
their attention from the cultivation of land. The superiority of produce,
which, in consequence of this undivided attention, they are enabled to
raise, is fully sufficient to pay the whole expense which the maintenance
and employment of the unproductive class costs either the proprietors or
themselves. The industry of merchants, artificers, and manufacturers, though
in its own nature altogether unproductive, yet contributes in this manner
indirectly to increase the produce of the land. It increases the productive
powers of productive labour by leaving it at liberty to confine itself
to its proper employment, the cultivation of land; and the plough goes
frequently the easier and the better by means of the labour of the man
whose business is most remote from the plough. It can never be the interest
of the proprietors and cultivators to restrain or to discourage in any
respect the industry of merchants, artificers, and manufacturers. The greater
the liberty which this unproductive class enjoys, the greater will be the
competition in all the different trades which compose it, and the cheaper
will the other two classes be supplied, both with foreign goods and with
the manufactured produce of their own country. It can never be the interest
of the unproductive class to oppress the other two classes. It is the surplus
produce of the land, or what remains after deducting the maintenance, first,
of the cultivators, and afterwards of the proprietors, that maintains and
employs the unproductive class. The greater this surplus the greater must
likewise be the maintenance and employment of that class. The establishment
of perfect justice, of perfect liberty, and of perfect equality is the
very simple secret which most effectually secures the highest degree of
prosperity to all the three classes. The merchants, artificers, and manufacturers
of those mercantile states which, like Holland and Hamburg, consist chiefly
of this unproductive class, are in the same manner maintained and employed
altogether at the expense of the proprietors and cultivators of land. The
only difference is, that those proprietors and cultivators are, the greater
part of them, placed at a most inconvenient distance from the merchants,
artificers, and manufacturers whom they supply with the materials of their
work and the fund of their subsistences- the inhabitants of other countries
and the subjects of other governments. Such mercantile states, however,
are not only useful, but greatly useful to the inhabitants of those other
countries. They fill up, in some measure, a very important void, and supply
the place of the merchants, artificers, and manufacturers whom the inhabitants
of those countries ought to find at home, but whom, from some defect in
their policy, they do not find at home. It can never be the interest of
those landed nations, if I may call them so, to discourage or distress
the industry of such mercantile states by imposing high duties upon their
trade or upon the commodities which they furnish. Such duties, by rendering
those commodities dearer, could serve only to sink the real value of the
surplus produce of their own land, with which, or, what comes to the same
thing, with the price of which those commodities are purchased. Such duties
could serve only to discourage the increase of that surplus produce, and
consequently the improvement and cultivation of their own land. The most
effectual expedient, on the contrary, for raising the value of that surplus
produce, for encouraging its increase, and consequently the improvement
and cultivation of their own land would be to allow the most perfect freedom
to the trade of all such mercantile nations. This perfect freedom of trade
would even be the most effectual expedient for supplying them, in due time,
with all the artificers, manufacturers, and merchants whom they wanted
at home, and for filling up in the properest and most advantageous manner
that very important void which they felt there. The continual increase
of the surplus produce of their land would, in due time, create a greater
capital than what could be employed with the ordinary rate of profit in
the improvement and cultivation of land; and the surplus part of it would
naturally turn itself to the employment of artificers and manufacturers
at home. But those artificers and manufacturers, finding at home both the
materials of their work and the fund of their subsistence, might immediately
even with much less art and skill be able to work as cheap as the like
artificers and manufacturers of such mercantile states who had both to
bring from a great distance. Even though, from want of art and skill, they
might not for some time be able to work as cheap, yet, finding a market
at home, they might be able to sell their work there as cheap as that of
the artificers and manufacturers of such mercantile states, which could
not be brought to that market but from so great a distance; and as their
art and skill improved, they would soon be able to sell it cheaper. The
artificers and manufacturers of such mercantile states, therefore, would
immediately be rivalled in the market of those landed nations, and soon
after undersold and jostled out of it altogether. The cheapness of the
manufactures of those landed nations, in consequence of the gradual improvements
of art and skill, would, in due time, extend their sale beyond the home
market, and carry them to many foreign markets, from which they would in
the same manner gradually jostle out many of the manufacturers of such
mercantile nations. This continual increase both of the rude and manufactured
produce of those landed nations would in due time create a greater capital
than could, with the ordinary rate of profit, be employed either in agriculture
or in manufactures. The surplus of this capital would naturally turn itself
to foreign trade, and be employed in exporting to foreign countries such
parts of the rude and manufactured produce of its own country as exceeded
the demand of the home market. In the exportation of the produce of their
own country, the merchants of a landed nation would have an advantage of
the same kind over those of mercantile nations which its artificers and
manufacturers had over the artificers and manufacturers of such nations;
the advantage of finding at home that cargo and those stores and provisions
which the others were obliged to seek for at a distance. With inferior
art and skill in navigation, therefore, they would be able to sell that
cargo as cheap in foreign markets as the merchants of such mercantile nations;
and with equal art and skill they would be able to sell it cheaper. They
would soon, therefore, rival those mercantile nations in this branch of
foreign trade, and in due time would jostle them out of it altogether.
According to this liberal and generous system, therefore, the most advantageous
method in which a landed nation can raise up artificers, manufacturers,
and merchants of its own is to grant the most perfect freedom of trade
to the artificers, manufacturers, and merchants of all other nations. It
thereby raises the value of the surplus produce of its own land, of which
the continual increase gradually establishes a fund, which in due time
necessarily raises up all the artificers, manufacturers, and merchants
whom it has occasion for. When a landed nation, on the contrary, oppresses
either by high duties or by prohibitions the trade of foreign nations,
it necessarily hurts its own interest in two different ways. First, by
raising the price of all foreign goods and of all sorts of manufactures,
it necessarily sinks the real value of the surplus produce of its own land,
with which, or, what comes to the same thing, with the price of which it
purchases those foreign goods and manufactures. Secondly, by giving a sort
of monopoly of the home market to its own merchants, artificers, and manufacturers,
it raises the rate of mercantile and manufacturing profit in proportion
to that of agricultural profit, and consequently either draws from agriculture
a part of the capital which had before been employed in it, or hinders
from going to it a part of what would otherwise have gone to it. This policy,
therefore, discourages agriculture in two different ways; first, by sinking
the real value of its produce, and thereby lowering the rate of its profit;
and, secondly, by raising the rate of profit in all other employments.
Agriculture is rendered less advantageous, and trade and manufactures more
advantageous than they otherwise would be; and every man is tempted by
his own interest to turn, as much as he can, both his capital and his industry
from the former to the latter employments. Though, by this oppressive policy,
a landed nation should be able to raise up artificers, manufacturers, and
merchants of its own somewhat sooner than it could do by the freedom of
trade a matter, however, which is not a little doubtful- yet it would raise
them up, if one may say so, prematurely, and before it was perfectly ripe
for them. By raising up too hastily one species of industry, it would depress
another more valuable species of industry. By raising up too hastily a
species of industry which only replaces the stock which employs it, together
with the ordinary profit, it would depress a species of industry which,
over and above replacing that stock with its profit, affords likewise a
net produce, a free rent to the landlord. It would depress productive labour,
by encouraging too hastily that labour which is altogether barren and unproductive.
In what manner, according to this system, the sum total of the annual produce
of the land is distributed among the three classes above mentioned, and
in what manner the labour of the unproductive class does no more than replace
the value of its own consumption, without increasing in any respect the
value of that sum total, is represented by Mr. Quesnai, the very ingenious
and profound author of this system, in some arithmetical formularies. The
first of these formularies, which by way of eminence he peculiarly distinguishes
by the name of the Economical Table, represents the manner in which he
supposes the distribution takes place in a state of the most perfect liberty
and therefore of the highest prosperity- in a state where the annual produce
is such as to afford the greatest possible net produce, and where each
class enjoys its proper share of the whole annual produce. Some subsequent
formularies represent the manner in which he supposes this distribution
is made in different states of restraint and regulation; in which either
the class of proprietors or the barren and unproductive class is more favoured
than the class of cultivators, and in which either the one or the other
encroaches more or less upon the share which ought properly to belong to
this productive class. Every such encroachment, every violation of that
natural distribution, which the most perfect liberty would establish, must,
according to this system, necessarily degrade more or less, from one year
to another, the value and sum total of the annual produce, and must necessarily
occasion a gradual declension in the real wealth and revenue of the society;
a declension of which the progress must be quicker or slower, according
to the degree of this encroachment, according as that natural distribution
which the most perfect liberty would establish is more or less violated.
Those subsequent formularies represent the different degrees of declension
which, according to this system, correspond to the different degrees in
which this natural distribution is violated. Some speculative physicians
seem to have imagined that the health of the human body could be preserved
only by a certain precise regimen of diet and exercise, of which every,
the smallest, violation necessarily occasioned some degree of disease or
disorder proportioned to the degree of the violation. Experience, however,
would seem to show that the human body frequently preserves, to all appearances
at least, the most perfect state of health under a vast variety of different
regimens; even under some which are generally believed to be very far from
being perfectly wholesome. But the healthful state of the human body, it
would seem, contains in itself some unknown principle of preservation,
capable either of preventing or of correcting, in many respects, the bad
effects even of a very faulty regimen. Mr. Quesnai, who was himself a physician,
and a very speculative physician, seems to have entertained a notion of
the same kind concerning the political body, and to have imagined that
it would thrive and prosper only under a certain precise regimen, the exact
regimen of perfect liberty and perfect justice. He seems not to have considered
that, in the political body, the natural effort which every man is continually
making to better his own condition is a principle of preservation capable
of preventing and correcting, in many respects, the bad effects of a political
economy, in some degree, both partial and oppressive. Such a political
economy, though it no doubt retards more or less, is not always capable
of stopping altogether the natural progress of a nation towards wealth
and prosperity, and still less of making it go backwards. If a nation could
not prosper without the enjoyment of perfect liberty and perfect justice,
there is not in the world a nation which could ever have prospered. In
the political body, however, the wisdom of nature has fortunately made
ample provision for remedying many of the bad effects of the folly and
injustice of man, in the same manner as it has done in the natural body
for remedying those of his sloth and intemperance. The capital error of
this system, however, seems to lie in its representing the class of artificers,
manufacturers, and merchants as altogether barren and unproductive. The
following observations may serve to show the impropriety of this representation.
First, this class, it is acknowledged, reproduces annually the value of
its own annual consumption, and continues, at least, the existence of the
stock or capital which maintains and employs it. But upon this account
alone the denomination of barren or unproductive should seem to be very
improperly applied to it. We should not call a marriage barren or unproductive
though it produced only a son and a daughter, to replace the father and
mother, and though it did not increase the number of the human species,
but only continued it as it was before. Farmers and country labourers,
indeed, over and above the stock which maintains and employs them, reproduce
annually a net produce, a free rent to the landlord. As a marriage which
affords three children is certainly more productive than one which affords
only two; so the labour of farmers and country labourers is certainly more
productive than that of merchants, artificers, and manufacturers. The superior
produce of the one class, however, does not render the other barren or
unproductive. Secondly, it seems, upon this account, altogether improper
to consider artificers, manufacturers, and merchants in the same light
as menial servants. The labour of menial servants does not continue the
existence of the fund which maintains and employs them. Their maintenance
and employment is altogether at the expense of their masters, and the work
which they perform is not of a nature to repay that expense. That work
consists in services which perish generally in the very instant of their
performance, and does not fix or realize itself in any vendible commodity
which can replace the value of their wages and maintenance. The labour,
on the contrary, of artificers, manufacturers, and merchants naturally
does fix and realize itself in some such vendible commodity. It is upon
this account that, in the chapter in which I treat of productive and unproductive
labour, I have classed artificers, manufacturers, and merchants among the
productive labourers, and menial servants among the barren or unproductive.
Thirdly, it seems upon every supposition improper to say that the labour
of artificers, manufacturers, and merchants does not increase the real
revenue of the society. Though we should suppose, for example, as it seems
to be supposed in this system, that the value of the daily, monthly, and
yearly consumption of this class was exactly equal to that of its daily,
monthly, and yearly production, yet it would not from thence follow that
its labour added nothing to the real revenue, to the real value of the
annual produce of the land and labour of the society. An artificer, for
example, who, in the first six months after harvest, executes ten pounds'
worth of work, though he should in the same time consume ten pounds' worth
of corn and other necessaries, yet really adds the value of ten pounds
to the annual produce of the land and labour of the society. While he has
been consuming a half-yearly revenue of ten pounds' worth of corn and other
necessaries, he has produced an equal value of work capable of purchasing,
either to himself or some other person, an equal half-yearly revenue. The
value, therefore, of what has been consumed and produced during these six
months is equal, not to ten, but to twenty pounds. It is possible, indeed,
that no more than ten pounds' worth of this value may ever have existed
at any one moment of time. But if the ten pounds' worth of corn and other
necessaties, which were consumed by the artificer, had been consumed by
a soldier or by a menial servant, the value of that part of the annual
produce which existed at the end of the six months would have been ten
pounds less than it actually is in consequence of the labour of the artificer.
Though the value of what the artificer produces, therefore, should not
at any one moment of time be supposed greater than the value he consumes,
yet at every moment of time the actually existing value of goods in the
market is, in consequence of what he produces, greater than it otherwise
would be. When the patrons of this system assert that the consumption of
artificers, manufacturers, and merchants is equal to the value of what
they produce, they probably mean no more than that their revenue, or the
fund destined for their consumption, is equal to it. But if they had expressed
themselves more accurately, and only asserted that the revenue of this
class was equal to the value of what they produced, it might readily have
occurred to the reader that what would naturally be saved out of this revenue
must necessarily increase more or less the real wealth of the society.
In order, therefore, to make out something like an argument, it was necessary
that they should express themselves as they have done; and this argument,
even supposing things actually were as it seems to presume them to be,
turns out to be a very inconclusive one. Fourthly, farmers and country
labourers can no more augment, without parsimony, the real revenue, the
annual produce of the land and labour of their society, than artificers,
manufacturers, and merchants. The annual produce of the land and labour
of any society can be augmented only in two ways; either, first, by some
improvement in the productive powers of the useful labour actually maintained
within it; or, secondly, by some increase in the quantity of that labour.
The improvement in the productive powers of useful labour depend, first,
upon the improvement in the ability of the workman; and, secondly, upon
that of the machinery with which he works. But the labour of artificers
and manufacturers, as it is capable of being more subdivided, and the labour
of each workman reduced to a greater simplicity of operation than that
of farmers and country labourers, so it is likewise capable of both these
sorts of improvements in a much higher degree. In this respect, therefore,
the class of cultivators can have no sort of advantage over that of artificers
and manufacturers. The increase in the quantity of useful labour actually
employed within any society must depend altogether upon the increase of
the capital which employs it; and the increase of that capital again must
be exactly equal to the amount of the savings from the revenue, either
of the particular persons who manage and direct the employment of that
capital, or of some other persons who lend it to them. If merchants, artificers,
and manufacturers are, as this system seems to suppose, naturally more
inclined to parsimony and saving than proprietors and cultivators, they
are, so far, more likely to augment the quantity of useful labour employed
within their society, and consequently to increase its real revenue, the
annual produce of its land and labour. Fifthly and lastly, though the revenue
of the inhabitants of every country was supposed to consist altogether,
as this system seems to suppose, in the quantity of subsistence which their
industry could procure to them; yet, even upon this supposition, the revenue
of a trading and manufacturing country must, other things being equal,
always be much greater than that of one without trade or manufactures.
By means of trade and manufactures, a greater quantity of subsistence can
be annually imported into a particular country than what its own lands,
in the actual state of their cultivation, could afford. The inhabitants
of a town, though they frequently possess no lands of their own, yet draw
to themselves by their industry such a quantity of the rude produce of
the lands of other people as supplies them, not only with the materials
of their work, but with the fund of their subsistence. What a town always
is with regard to the country in its neighbourhood, one independent state
or country may frequently be with regard to other independent states or
countries. It is thus that Holland draws a great part of its subsistence
from other countries; live cattle from Holstein and Jutland, and corn from
almost all the different countries of Europe. A small quantity of manufactured
produce purchases a great quantity of rude produce. A trading and manufacturing
country, therefore, naturally purchases with a small part of its manufactured
produce a great part of the rude produce of other countries; while, on
the contrary, a country without trade and manufactures is generally obliged
to purchase, at the expense of a great part of its rude produce, a very
small part of the manufactured produce of other countries. The one exports
what can subsist and accommodate but a very few, and imports the subsistence
and accommodation of a great number. The other exports the accommodation
and subsistence of a great number, and imports that of a very few only.
The inhabitants of the one must always enjoy a much greater quantity of
subsistence than what their own lands, in the actual state of their cultivation,
could afford. The inhabitants of the other must always enjoy a much smaller
quantity. This system, however, with all its imperfections is, perhaps,
the nearest approximation to the truth that has yet been published upon
the subject of political economy, and is upon that account well worth the
consideration of every man who wishes to examine with attention the principles
of that very important science. Though in representing the labour which
is employed upon land as the only productive labour, the notions which
it inculcates are perhaps too narrow and confined; yet in representing
the wealth of nations as consisting, not in the unconsumable riches of
money, but in the consumable goods annually reproduced by the labour of
the society, and in representing perfect liberty as the only effectual
expedient for rendering this annual reproduction the greatest possible,
its doctrine seems to be in every respect as just as it is generous and
liberal. Its followers are very numerous; and as men are fond of paradoxes,
and of appearing to understand what surpasses the comprehension of ordinary
people, the paradox which it maintains, concerning the unproductive nature
of manufacturing labour, has not perhaps contributed a little to increase
the number of its admirers. They have for some years past made a pretty
considerable sect, distinguished in the French republic of letters by the
name of The Economists. Their works have certainly been of some service
to their country; not only by bringing into general discussion many subjects
which had never been well examined before, but by influencing in some measure
the public administration in favour of agriculture. It has been in consequence
of their representations, accordingly, that the agriculture of France has
been delivered from several of the oppressions which it before laboured
under. The term during which such a lease can be granted, as will be valid
against every future purchaser or proprietor of the land, has been prolonged
from nine to twenty-seven years. The ancient provincial restraints upon
the transportation of corn from one province of the kingdom to another
have been entirely taken away, and the liberty of exporting it to all foreign
countries has been established as the common law of the kingdom in all
ordinary cases. This sect, in their works, which are very numerous, and
which treat not only of what is properly called Political Economy, or of
the nature and causes of the wealth of nations, but of every other branch
of the system of civil government, all follow implicitly and without any
sensible variation, the doctrine of Mr. Quesnai. There is upon this account
little variety in the greater part of their works. The most distinct and
best connected account of this doctrine is to be found in a little book
written by Mr. Mercier de la Riviere, some time intendant of Martinico,
entitled, The Natural and Essential Order of Political Societies.
The admiration of this whole sect for their master, who was himself a man
of the greatest modesty and simplicity, is not inferior to that of any
of the ancient philosophers for the founders of their respective systems.
"There have been, since the world began," says a very diligent and respectable
author, the Marquis de Mirabeau, "three great inventions which have principally
given stability to political societies, independent of many other inventions
which have enriched and adorned them. The first is the invention of writing,
which alone gives human nature the power of transmitting, without alteration,
its laws, its contracts, its annals, and its discoveries. The second is
the invention of money, which binds together all the relations between
civilised societies. The third is the Economical Table, the result of the
other two, which completes them both by perfecting their object; the great
discovery of our age, but of which our posterity will reap the benefit."
As the political economy of the nations of modern Europe has been more
favourable to manufactures and foreign trade, the industry of the towns,
than to agriculture, the industry of the country; so that of other nations
has followed a different plan, and has been more favourable to agriculture
than to manufactures and foreign trade. The policy of China favours agriculture
more than all other employments. In China the condition of a labourer is
said to be as much superior to that of an artificer as in most parts of
Europe that of an artificer is to that of a labourer. In China, the great
ambition of every man is to get possession of some little bit of land,
either in property or in lease; and leases are there said to be granted
upon very moderate terms, and to be sufficiently secured to the lessees.
The Chinese have little respect for foreign trade. Your beggarly commerce!
was the language in which the Mandarins of Pekin used to talk to Mr. de
Lange, the Russian envoy, concerning it. Except with Japan, the Chinese
carry on, themselves, and in their own bottoms, little or no foreign trade;
and it is only into one or two ports of their kingdom that they even admit
the ships of foreign nations. Foreign trade therefore is, in China, every
way confined within a much narrower circle than that to which it would
naturally extend itself, if more freedom was allowed to it, either in their
own ships, or in those of foreign nations. Manufactures, as in a small
bulk they frequently contain a great value, and can upon that account be
transported at less expense from one country to another than most parts
of rude produce, are, in almost all countries, the principal support of
foreign trade. In countries, besides, less extensive and less favourably
circumstanced for inferior commerce than China, they generally require
the support of foreign trade. Without an extensive foreign market they
could not well flourish, either in countries so moderately extensive as
to afford but a narrow home market or in countries where the communication
between one province and another was so difficult as to render it impossible
for the goods of any particular place to enjoy the whole of that home market
which the country could afford. The perfection of manufacturing industry,
it must be remembered, depends altogether upon the division of labour;
and the degree to which the division of labour can be introduced into any
manufacture is necessarily regulated, it has already been shown, by the
extent of the market. But the great extent of the empire of China, the
vast multitude of its inhabitants, the variety of climate, and consequently
of productions in its different provinces, and the easy communication by
means of water carriage between the greater part of them, render the home
market of that country of so great extent as to be alone sufficient to
support very great manufactures, and to admit of very considerable subdivisions
of labour. The home market of China is, perhaps, in extent, not much inferior
to the market of all the different countries of Europe put together. A
more extensive foreign trade, however, which to this great home market
added the foreign market of all the rest of the world- especially if any
considerable part of this trade was carried on in Chinese ships- could
scarce fail to increase very much the manufactures of China, and to improve
very much the productive powers of its manufacturing industry. By a more
extensive navigation, the Chinese would naturally learn the art of using
and constructing themselves all the different machines made use of in other
countries, as well as the other improvements of art and industry which
are practised in all the different parts of the world. Upon their present
plan they have little opportunity except that of the Japanese. The policy
of ancient Egypt too, and that of the Gentoo government of Indostan, seem
to have favoured agriculture more than all other employments. Both in ancient
Egypt and Indostan the whole body of the people was divided into different
castes or tribes, each of which was confined, from father to son, to a
particular employment or class of employments. The son of a priest was
necessarily a priest; the son of a soldier, a soldier; the son of a labourer,
a labourer; the son of a weaver, a weaver; the son of a tailor, a tailor,
etc. In both countries, the caste of the priests held the highest rank,
and that of the soldiers the next; and in both countries, the caste of
the farmers and labourers was superior to the castes of merchants and manufacturers.
The government of both countries was particularly attentive to the interest
of agriculture. The works constructed by the ancient sovereigns of Egypt
for the proper distribution of the waters of the Nile were famous in antiquity;
and the ruined remains of some of them are still the admiration of travellers.
Those of the same kind which were constructed by the ancient sovereigns
of Indostan for the proper distribution of the waters of the Ganges as
well as of many other rivers, though they have been less celebrated, seem
to have been equally great. Both countries, accordingly, though subject
occasionally to dearths, have been famous for their great fertility. Though
both were extremely populous, yet, in years of moderate plenty, they were
both able to export great quantities of grain to their neighbours. The
ancient Egyptians had a superstitious aversion to the sea; and as the Gentoo
religion does not permit its followers to light a fire, nor consequently
to dress any victuals upon the water, it in effect prohibits them from
all distant sea voyages. Both the Egyptians and Indians must have depended
almost altogether upon the navigation of other nations for the exportation
of their surplus produce; and this dependency, as it must have confined
the market, so it must have discouraged the increase of this surplus produce.
It must have discouraged, too, the increase of the manufactured produce
more than that of the rude produce. Manufactures require a much more extensive
market than the most important parts of the rude produce of the land. A
single shoemaker will make more than three hundred pairs of shoes in the
year; and his own family will not, perhaps, wear out six pairs. Unless
therefore he has the custom of at least fifty such families as his own,
he cannot dispose of the whole produce of his own labour. The most numerous
class of artificers will seldom, in a large country, make more than one
in fifty or one in a hundred of the whole number of families contained
in it. But in such large countries as France and England, the number of
people employed in agriculture has by some authors been computed at a half,
by others at a third, and by no author that I know of, at less than a fifth
of the whole inhabitants of the country. But as the produce of the agriculture
of both France and England is, the far greater part of it, consumed at
home, each person employed in it must, according to these computations,
require little more than the custom of one, two, or at most, of four such
families as his own in order to dispose of the whole produce of his own
labour. Agriculture, therefore, can support itself under the discouragement
of a confined market much better than manufactures. In both ancient Egypt
and Indostan, indeed, the confinement of the foreign market was in some
measure compensated by the conveniency of many inland navigations, which
opened, in the most advantageous manner, the whole extent of the home market
to every part of the produce of every different district of those countries.
The great extent of Indostan, too, rendered the home market of that country
very great, and sufficient to support a great variety of manufactures.
But the small extent of ancient Egypt, which was never equal to England,
must at all times have rendered the home market of that country too narrow
for supporting any great variety of manufactures. Bengal, accordingly,
the province of Indostan, which commonly exports the greatest quantity
of rice, has always been more remarkable for the exportation of a great
variety of manufactures than for that of its grain. Ancient Egypt, on the
contrary, though it exported some manufactures, fine linen in particular,
as well as some other goods, was always most distinguished for its great
exportation of grain. It was long the granary of the Roman empire. The
sovereigns of China, of ancient Egypt, and of the different kingdoms into
which Indostan has at different times been divided, have always derived
the whole, or by far the most considerable part, of their revenue from
some sort of land tax or land rent. This land tax or land rent, like the
tithe in Europe, consisted in a certain proportion, a fifth, it is said,
of the produce of the land, which was either delivered in kind, or paid
in money, according to a certain valuation, and which therefore varied
from year to year according to all the variations of the produce. It was
natural therefore that the sovereigns of those countries should be particularly
attentive to the interests of agriculture, upon the prosperity or declension
of which immediately depended the yearly increase or diminution of their
own revenue. The policy of the ancient republics of Greece, and that of
Rome, though it honoured agriculture more than manufactures or foreign
trade, yet seems rather to have discouraged the latter employments than
to have given any direct or intentional encouragement to the former. In
several of the ancient states of Greece, foreign trade was prohibited altogether;
and in several others the employments of artificers and manufacturers were
considered as hurtful to the strength and agility of the human body, as
rendering it incapable of those habits which their military and gymnastic
exercises endeavoured to form in it, and as thereby disqualifying it more
or less for undergoing the fatigues and encountering the dangers of war.
Such occupations were considered as fit only for slaves, and the free citizens
of the state were prohibited from exercising them. Even in those states
where no such prohibition took place, as in Rome and Athens, the great
body of the people were in effect excluded from all the trades which are,
now commonly exercised by the lower sort of the inhabitants of towns. Such
trades were, at Athens and Rome, all occupied by the slaves of the rich,
who exercised them for the benefit of their masters, whose wealth, power,
and protection made it almost impossible for a poor freeman to find a market
for his work, when it came into competition with that of the slaves of
the rich. Slaves, however, are very seldom inventive; and all the most
important improvements, either in machinery, or in the arrangement and
distribution of work which facilitate and abridge labour, have been the
discoveries of freemen. Should a slave propose any improvement of this
kind, his master would be very apt to consider the proposal as the suggestion
of laziness, and a desire to save his own labour at the master's expense.
The poor slave, instead of reward, would probably meet with much abuse,
perhaps with some punishment. In the manufactures carried on by slaves,
therefore, more labour must generally have been employed to execute the
same quantity of work than in those carried on by freemen. The work of
the former must, upon that account, generally have been dearer than that
of the latter. The Hungarian mines, it is remarked by Mr. Montesquieu,
though not richer, have always been wrought with less expense, and therefore
with more profit, than the Turkish mines in their neighbourhood. The Turkish
mines are wrought by slaves; and the arms of those slaves are the only
machines which the Turks have ever thought of employing. The Hungarian
mines are wrought by freemen, who employ a great deal of machinery, by
which they facilitate and abridge their own labour. From the very little
that is known about the price of manufactures in the times of the Greeks
and Romans, it would appear that those of the finer sort were excessively
dear. Silk sold for its weight in gold. It was not, indeed, in those times
a European manufacture; and as it was all brought from the East Indies,
the distance of the carriage may in some measure account for the greatness
of price. The price, however, which a lady, it is said, would sometimes
pay for a piece of very fine linen, seems to have been equally extravagant;
and as linen was always either a European, or at farthest, an Egyptian
manufacture, this high price can be accounted for only by the great expense
of the labour which must have been employed about it, and the expense of
this labour again could arise from nothing but the awkwardness of the machinery
which it made use of. The price of fine woollens too, though not quite
so extravagant, seems however to have been much above that of the present
times. Some cloths, we are told by Pliny, dyed in a particular manner,
cost a hundred denarii, or three pounds six shillings and eightpence the
pound weight. Others dyed in another manner cost a thousand denarii the
pound weight, or thirty-three pounds six shillings and eightpence. The
Roman pound, it must be remembered, contained only twelve of our avoirdupois
ounces. This high price, indeed, seems to have been principally owing to
the dye. But had not the cloths themselves been much dearer than any which
are made in the present times, so very expensive a dye would not probably
have been bestowed upon them. The disproportion would have been too great
between the value of the accessory and that of the principal. The price
mentioned by the same author of some Triclinaria, a sort of woollen pillows
or cushions made use of to lean upon as they reclined upon their couches
at table, passes all credibility; some of them being said to have cost
more than thirty thousand, others more than three hundred thousand pounds.
This high price, too, is not said to have arisen from the dye. In the dress
of the people of fashion of both sexes there seems to have been much less
variety, it is observed by Doctor Arbuthnot, in ancient than in modern
times; and the very little variety which we find in that of the ancient
statues confirms his observation. He infers from this that their dress
must upon the whole have been cheaper than ours; but the conclusion does
not seem to follow. When the expense of fashionable dress is very great,
the variety must be very small. But when, by the improvements in the productive
powers of manufacturing art and industry, the expense of any one dress
comes to be very moderate, the variety will naturally be very great. The
rich, not being able to distinguish themselves by the expense of any one
dress, will naturally endeavour to do so by the multitude and variety of
their dresses. The greatest and most important branch of the commerce of
every nation, it has already been observed, is that which is carried on
between the inhabitants of the town and those of the country. The inhabitants
of the town draw from the country the rude produce which constitutes both
the materials of their work and the fund of their subsistence; and they
pay for this rude produce by sending back to the country a certain portion
of it manufactured and prepared for immediate use. The trade which is carried
on between these two different sets of people consists ultimately in a
certain quantity of rude produce exchanged for a certain quantity of manufactured
produce. The dearer the latter, therefore, the cheaper the former; and
whatever tends in any country to raise the price of manufactured produce
tends to lower that of the rude produce of the land, and thereby to discourage
agriculture. The smaller the quantity of manufactured produce which in
any given quantity of rude produce, or, what comes to the same thing, which
the price of any given quantity of rude produce is capable of purchasing,
the smaller the exchangeable value of that given quantity of rude produce,
the smaller the encouragement which either the landlord has to increase
its quantity by improving or the farmer by cultivating the land. Whatever,
besides, tends to diminish in any country the number of artificers and
manufacturers, tends to diminish the home market, the most important of
all markets for the rude produce of the land, and thereby still further
to discourage agriculture. Those systems, therefore, which, preferring
agriculture to all other employments, in order to promote it, impose restraints
upon manufactures and foreign trade, act contrary to the very end which
they propose, and indirectly discourage that very species of industry which
they mean to promote. They are so far, perhaps, more inconsistent than
even the mercantile system. That system, by encouraging manufactures and
foreign trade more than agriculture, turns a certain portion of the capital
of the society from supporting a more advantageous, to support a less advantageous
species of industry. But still it really and in the end encourages that
species of industry which it means to promote. Those agricultural systems,
on the contrary, really and in the end discourage their own favourite species
of industry. It is thus that every system which endeavours, either by extraordinary
encouragements to draw towards a particular species of industry a greater
share of the capital of the society than what would naturally go to it,
or, by extraordinary restraints, force from a particular species of industry
some share of the capital which would otherwise be employed in it, is in
reality subversive of the great purpose which it means to promote. It retards,
instead of accelerating, the progress of the society towards real wealth
and greatness; and diminishes, instead of increasing, the real value of
the annual produce of its land and labour. All systems either of preference
or of restraint, therefore, being thus completely taken away, the obvious
and simple system of natural liberty establishes itself of its own accord.
Every man, as long as he does not violate the laws of justice, is left
perfectly free to pursue his own interest his own way, and to bring both
his industry and capital into competition with those of any other man,
or order of men. The sovereign is completely discharged from a duty, in
the attempting to perform which he must always be exposed to innumerable
delusions, and for the proper performance of which no human wisdom or knowledge
could ever be sufficient; the duty of superintending the industry of private
people, and of directing it towards the employments most suitable to the
interest of the society. According to the system of natural liberty, the
sovereign has only three duties to attend to; three duties of great importance,
indeed, but plain and intelligible to common understandings: first, the
duty of protecting the society from violence and invasion of other independent
societies; secondly, the duty of protecting, as far as possible, every
member of the society from the injustice or oppression of every other member
of it, or the duty of establishing an exact administration of justice;
and, thirdly, the duty of erecting and maintaining certain public works
and certain public institutions which it can never be for the interest
of any individual, or small number of individuals, to erect and maintain;
because the profit could never repay the expense to any individual or small
number of individuals, though it may frequently do much more than repay
it to a great society. The proper performance of those several duties of
the sovereign necessarily supposes a certain expense; and this expense
again necessarily requires a certain revenue to support it. In the following
book, therefore, I shall endeavour to explain, first, what are the necessary
expenses of the sovereign or commonwealth; and which of those expenses
ought to be defrayed by the general contribution of the whole society;
and which of them by that of some particular part only, or of some particular
members of the society; secondly, what are the different methods in which
the whole society may be made to contribute towards defraying the expenses
incumbent on the whole society, and what are the principal advantages and
inconveniences of each of those methods; and thirdly, what are the reasons
and causes which have induced almost all modern governments to mortgage
some part of this revenue, or to contract debts, and what have been the
effects of those debts upon the real wealth, the annual produce of the
land and labour of the society. The following book, therefore, will naturally
be divided into three chapters.
[Link to Book Five]