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diff --git a/.gitattributes b/.gitattributes new file mode 100644 index 0000000..6833f05 --- /dev/null +++ b/.gitattributes @@ -0,0 +1,3 @@ +* text=auto +*.txt text +*.md text diff --git a/4335-h.zip b/4335-h.zip Binary files differnew file mode 100644 index 0000000..4100963 --- /dev/null +++ b/4335-h.zip diff --git a/4335-h/4335-h.htm b/4335-h/4335-h.htm new file mode 100644 index 0000000..d9c40ae --- /dev/null +++ b/4335-h/4335-h.htm @@ -0,0 +1,1806 @@ +<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"> +<HTML> +<HEAD> + +<META HTTP-EQUIV="Content-Type" CONTENT="text/html; charset=iso-8859-1"> + +<TITLE> +The Project Gutenberg E-text of Importation of Foreign Corn, by Thomas Malthus +</TITLE> + +<STYLE TYPE="text/css"> +BODY { color: Black; + background: White; + margin-right: 10%; + margin-left: 10%; + font-family: "Times New Roman", serif; + text-align: justify } + +P {text-indent: 4% } + +P.noindent {text-indent: 0% } + +P.poem {text-indent: 0%; + margin-left: 10%; + font-size: small } + +P.letter {text-indent: 0%; + font-size: small ; + margin-left: 10% ; + margin-right: 10% } + +P.footnote {font-size: small ; + text-indent: 0% ; + margin-left: 0% ; + margin-right: 0% } + +P.transnote {font-size: small ; + text-indent: 0% ; + margin-left: 0% ; + margin-right: 0% } + +P.intro {font-size: medium ; + text-indent: -5% ; + margin-left: 5% ; + margin-right: 0% } + +P.finis { font-size: larger ; + text-align: center ; + text-indent: 0% ; + margin-left: 0% ; + margin-right: 0% } + +</STYLE> + +</HEAD> + +<BODY> + + +<pre> + +The Project Gutenberg EBook of The Grounds of an Opinion on the Policy of +Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws", by Thomas Malthus + +This eBook is for the use of anyone anywhere at no cost and with +almost no restrictions whatsoever. You may copy it, give it away or +re-use it under the terms of the Project Gutenberg License included +with this eBook or online at www.gutenberg.org + + +Title: The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws" + +Author: Thomas Malthus + +Posting Date: July 25, 2009 [EBook #4335] +Release Date: August, 2003 +First Posted: January 11, 2002 + +Language: English + +Character set encoding: ISO-8859-1 + +*** START OF THIS PROJECT GUTENBERG EBOOK IMPORTATION OF FOREIGN CORN *** + + + + +Produced by Charles Aldarondo. HTML version by Al Haines. + + + + + +</pre> + + +<BR><BR> + +<H2 ALIGN="center"> +The Grounds of an Opinion on the Policy of Restricting the<BR> +Importation of Foreign Corn; intended as an Appendix to<BR> +"Observations on the Corn Law" +</H2> + +<H3 ALIGN="center"> +by the Rev. T.R. Malthus, +</H3> + +<H4 ALIGN="center"> +Professor of History and Political Economy<BR> +in the East India College, Hertfordshire. +</H4> + +<BR><BR> + +<H5 ALIGN="center"> +London: Printed for John Murray, Albermarle Street, <BR> +and J. Johnson and Co., St. Paul's Church Yard, 1815. +</H5> + +<BR><BR><BR><BR> + +<H3> +Grounds, &c. +</H3> + +<BR> + +<P> +The professed object of the Observations on the Corn Laws, which I +published in the spring of 1814, was to state with the strictest +impartiality the advantages and disadvantages which, in the actual +circumstances of our present situation, were likely to attend the +measures under consideration, respecting the trade in corn. +</P> + +<P> +A fair review of both sides of the question, without any attempt to +conceal the peculiar evils, whether temporary or permanent, which +might belong to each, appeared to me of use, not only to assist in +forming an enlightened decision on the subject, but particularly to +prepare the public for the specific consequences which were to be +expected from that decision, on whatever side it might be made. Such +a preparation, from some quarter or other, seemed to be necessary, +to prevent those just discontents which would naturally have arisen, +if the measure adopted had been attended with results very different +from those which had been promised by its advocates, or contemplated +by the legislature. +</P> + +<P> +With this object in view, it was neither necessary, nor desirable, +that I should myself express a decided opinion on the subject. It +would hardly, indeed, have been consistent with that character of +impartiality, which I wished to give to my statements, and in which +I have reason to believe I in some degree succeeded.(1*) +</P> + +<P> +These previous statements, however, having been given, and having, I +hope, shewn that the decision, whenever it is made, must be a +compromise of contending advantages and disadvantages, I have no +objection now to state (without the least reserve), and I can truly +say, wit the most complete freedom from all interested motives, the +grounds of a deliberate, yet decided, opinion in favour of some +restrictions on the importation of foreign corn. +</P> + +<P> +This opinion has been formed, as I wished the readers of the +Observations to form their opinions, by looking fairly at the +difficulties on both sides of the question; and without vainly +expecting to attain unmixed results, determining on which side there +is the greatest balance of good with the least alloy of evil. The +grounds on which the opinion so formed rests, are partly those which +were stated in the Observations, and partly, and indeed mainly, some +facts which have occurred during the last year, and which have +given, as I think, a decisive weight to the side of restrictions. +</P> + +<P> +These additional facts are— +</P> + +<P> +1st, The evidence, which has been laid before Parliament, relating +to the effects of the present prices of corn, together with the +experience of the present year. +</P> + +<P> +2dly, The improved state of our exchanges, and the fall in the price +of bullion. And +</P> + +<P> +3dly, and mainly, the actual laws respecting the exportation of corn +lately passed in France. +</P> + +<P> +In the Observations on the corn laws, I endeavoured to shew that, +according to the general principles of supply and demand, a +considerable fall in the price of corn could not take place, without +throwing much poor lad out of cultivation, and effectually +preventing, for a considerable time, all further improvements in +agriculture, which have for their object an increase of produce. +</P> + +<P> +The general principles, on which I calculated upon these +consequences, have been fully confirmed by the evidence brought +before the two houses of Parliament; and the effects of a +considerable fall in the price of corn, and of the expected +continuance of low prices, have shewn themselves in a very severe +shock to the cultivation of the country and a great loss of +agricultural capital. +</P> + +<P> +Whatever may be said of the peculiar interests and natural +partialities of those who were called upon to give evidence upon +this occasion, it is impossible not to be convinced, by the whole +body of it taken together, that, during the last twenty years, and +particularly during the last seven, there has been a great increase +of capital laid out upon the land, and a great consequent extension +of cultivation and improvement; that the system of spirited +improvement and high farming, as it is technically called, has been +principally encouraged by the progressive rise of prices owing in a +considerable degree, to the difficulties thrown in the way of +importation of foreign corn by the war; that the rapid accumulation +of capital on the land, which it had occasioned, had so increased +our home growth of corn, that, notwithstanding a great increase of +population, we had become much less dependent upon foreign supplies +for our support; and that the land was still deficient in capital, +and would admit of the employment of such an addition to its present +amount, as would be competent to the full supply of a greatly +increased population: but that the fall of prices, which had lately +taken place, and the alarm of a still further fall, from continued +importation, had not only checked all progress of improvement, but +had already occasioned a considerable loss of agricultural advances; +and that a continuation of low prices would, in spite of a +diminution of rents, unquestionably destroy a great mass of farming +capital all over the country, and essentially diminish its +cultivation and produce. +</P> + +<P> +It has been sometimes said, that the losses at present sustained by +farmers are merely the natural and necessary consequences of +overtrading, and that they must bear them as all other merchants do, +who have entered into unsuccessful speculations. But surely the +question is not, or at least ought not to be, about the losses and +profits of farmers, and the present condition of landholders +compared with the past. It may be necessary, perhaps, to make +inquiries of this kind, with a view to ulterior objects; but the +real question respects the great loss of national wealth, attributed +to a change in the spirit of our legislative enactments relating to +the admission of foreign corn. +</P> + +<P> +We have certainly no right to accuse our farmers of rash speculation +for employing so large a capital in agriculture. The peace, it must +be allowed, was most unexpected; and if the war had continued, the +actual quantity of capital applied to the land, might have been as +necessary to save the country from extreme want in future, as it +obviously was in 1812, when, with the price of corn at above six +guineas a quarter, we could only import a little more than 100,000 +quarters. If, from the very great extension of cultivation, during +the four or five preceding years, we had not obtained a very great +increase of average produce, the distresses of that year would have +assumed a most serious aspect. +</P> + +<P> +There is certainly no one cause which can affect mercantile +concerns, at all comparable in the extent of its effects, to the +cause now operating upon agricultural capital. Individual losses +must have the same distressing consequences in both cases, and they +are often more complete, and the fall is greater, in the shocks of +commerce. But I doubt, whether in the most extensive mercantile +distress that ever took in this country, there was ever one fourth +of the property, or one tenth of the number of individuals +concerned, when compared with the effects of the present rapid fall +of raw produce, combined with the very scanty crop of last year.(2*) +</P> + +<P> +Individual losses of course become national, according as they +affect a greater mass of the national capital, and a greater number +of individuals; and I think it must be allowed further, that no +loss, in proportion to its amount, affects the interest of the +nation so deeply, and vitally, and is so difficult to recover, as +the loss of agricultural capital and produce. +</P> + +<P> +If it be the intention of the legislature fairly to look at the +evils, as well as the good, which belongs to both sides of the +question, it must be allowed, that the evidence laid before the two +houses of Parliament, and still more particularly the experience of +the last year, shew, that the immediate evils which are capable of +being remedied by a system of restrictions, are of no inconsiderable +magnitude. +</P> + +<P> +2. In the Observations on the corn laws, I gave, as a reason for +some delay in coming to a final regulation respecting the price at +which foreign corn might be imported, the very uncertain state of +the currency. I observed, that three different importation prices +would be necessary, according as our currency should either rise to +the then price of bullion, should continue at the same nominal +value, or should take an intermediate position, founded on a fall in +the value of bullion, owing to the discontinuance of an +extraordinary demand for it, and a rise in the value of paper, owing +to the prospect of a return to payments in specie. In the course of +this last year, the state of our exchanges, and the fall in the +price of bullion, shew pretty clearly, that the intermediate +alteration which, I then contemplated, greater than in the case +first mentioned, and less than in the second, is the one which might +be adopted with a fair prospect of permanence; and that we should +not now proceed under the same uncertainty respecting the currency, +which we should have done, if we had adopted a final regulation in +the early part of last year.(3*) This intermediate alteration, +however, supposes a rise in the value of paper on a return to cash +payments, and some general fall of prices quite unconnected with any +regulations respecting the corn trade.(4*) +</P> + +<P> +But, if some fall of prices must take place from this cause, and if +such a fall can never take place without a considerable check to +industry, and discouragement to the accumulation of capital, it +certainly does not seem a well-chosen time for the legislature to +occasion another fall still greater, by departing at once from a +system of restrictions which it had pursued with steadiness during +the greatest part of the last century and, after having given up for +a short period, had adopted again as its final policy in its two +last enactments respecting the trade in corn. Even if it be +intended. Finally, to throw open our ports, it might be wise to pass +some temporary regulations, in order to prevent the very great shock +which must take place, if the two causes here noticed, of the +depreciation of commodities, be allowed to produce their full effect +by contemporaneous action. +</P> + +<P> +3. I stated, in the Observations on the corn laws, that the +cheapness and steadiness in the price of corn, which were promised +by the advocates of restrictions, were not attainable by the +measures they proposed; that it was really impossible for us to grow +at home a sufficiency for our own consumption, without keeping up +the price of corn considerably above the average of the rest of +Europe; and that, while this was the case, as we could never export +to any advantage, we should always be liable to the variations of +price, occasioned by the glut of a superabundant harvest; in short, +that it must be allowed that a free trade in corn would, in all +ordinary cases, not only secure a cheaper, but a more steady, supply +of grain. +</P> + +<P> +In expressing this distinct opinion on the effects of a free trade +in corn, I certainly meant to refer to a trade really free—that +is, a trade by which a nation would be entitled to its share of the +produce of the commercial world, according to its means of +purchasing, whether that produce were plentiful or scanty. In this +sense I adhere strictly to the opinion I then gave; but, since that +period, an event has occurred which has shewn, in the clearest +manner, that it is entirely out of our power, even in time of peace, +to obtain a free trade in corn, or an approximation towards it, +whatever may be our wishes on the subject. +</P> + +<P> +It has, perhaps, not been sufficiently attended to in general, when +the advantages of a free trade in corn have been discussed, that the +jealousies and fears of nations, respecting their means of +subsistence, will very rarely allow of a free egress of corn, when +it is in any degree scarce. Our own statutes, till the very last +year, prove these fears with regard to ourselves; and regulations of +the same tendency occasionally come in aid of popular clamour in +almost all countries of Europe. But the laws respecting the +exportation of corn, which have been passed in France during the +last year, have brought this subject home to us in the most striking +and impressive manner. Our nearest neighbour, possessed of the +largest and finest corn country in Europe, and who, owing to a more +favourable climate and soil, a more stationary and comparatively +less crowded population, and a lighter weight of taxation, can grow +corn at less than half our prices, has enacted, that the exportation +of corn shall be free till the price rises to about forty nine +shillings a quarter,(5*) and that then it shall be entirely +cease.(6*) +</P> + +<P> +From the vicinity of France, and the cheapness of its corn in all +years of common abundance, it is scarcely possible that our main +imports should not come from that quarter as long as our ports are +open to receive them. In this first year of open trade, our imports +have been such, as to shew, that though the corn of the Baltic +cannot seriously depress our prices in an unfavourable season at +home, the corn of France may make it fall below a growing price, +under the pressure of one of the worst crops that has been known for +a long series of years. +</P> + +<P> +I have at present before me an extract from a Rouen paper, +containing the prices of corn in fourteen different markets for the +first week in October, the average of which appears to be about +thirty eight shillings a quarter;(7*) and this was after +disturbances had taken place both at Havre and Dieppe, on account of +the quantity exported, and the rise of prices which it had +occasioned. +</P> + +<P> +It may be said, perhaps, that the last harvest of France has been a +very favourable one, and affords no just criterion of its general +prices. But, from all that I hear, prices have often been as low +during the last ten years. And, an average not exceeding forty +shillings a quarter may, I think, be conclusively inferred from the +price at which exportation is by law to cease. +</P> + +<P> +At a time when, according to Adam Smith, the growing price in this +country was only twenty eight shillings a quarter, and the average +price, including years of scarcity, only thirty three shillings, +exportation was not prohibited till the price rose to forty eight +shillings. It was the intention of the English government, at that +time, to encourage agriculture by giving vent to its produce. We may +presume that the same motive influenced the government of France in +the late act respecting exportation. And it is fair therefore to +conclude, that the price of wheat, in common years, is considerably +less than the price at which exportation is to cease. +</P> + +<P> +With these prices so near us, and with the consequent power of +supplying ourselves with great comparative rapidity, which in the +corn trade is a point of the greatest importance, there can be no +doubt that, if our ports were open, our principal supplies of grain +would come from France; and that, in all years of common plenty in +that country, we should import more largely from it than from the +Baltic. But from this quarter, which would then become our main and +most habitual source of supply, all assistance would be at once cut +off, in every season of only moderate scarcity; and we should have +to look to other quarters, from which it is an established fact, +that large sudden supplies cannot be obtained, not only for our +usual imports, and the natural variations which belong to them, but +for those which had been suddenly cut off from France, and which our +habitually deficient growth had now rendered absolutely necessary. +</P> + +<P> +To open our ports, under these circumstances, is not to obtain a +free trade in corn; and, while I should say, without hesitation, +that a free trade in corn was calculated to produce steadier prices +than the system of restrictions with which it has been compared, I +should, with as little hesitation say, that such a trade in corn, as +has been described, would be subject to much more distressing and +cruel variations, than the most determined system of prohibitions. +</P> + +<P> +Such a species of commerce in grain shakes the foundations, and +alters entirely the data on which the general principles of free +trade are established. For what do these principles say? They say, +and say most justly, that if every nation were to devote itself +particularly to those kinds of industry and produce, to which its +soil, climate, situation, capital, and skill, were best suited; and +were then freely to exchange these products with each other, it +would be the most certain and efficacious mode, not only of +advancing the wealth and prosperity of the whole body of the +commercial republic with the quickest pace, but of giving to each +individual nation of the body the full and perfect use of all its +resources. +</P> + +<P> +I am very far indeed from meaning to insinuate, that if we cannot +have the most perfect freedom of trade, we should have none; or that +a great nation must immediately alter its commercial policy, +whenever any of the countries with which it deals passes laws +inconsistent with the principles of freedom. But I protest most +entirely against the doctrine, that we are to pursue our general +principles without ever looking to see if they are applicable to the +case before us; and that in politics and political economy, we are +to go straight forward, as we certainly ought to do in morals, +without any reference to the conduct and proceedings of others. +</P> + +<P> +There is no person in the least acquainted with political economy, +but must be aware that the advantages resulting from the division of +labour, as applicable to nations as well as individuals, depend +solely and entirely on the power of exchanging subsequently the +products of labour. And no one can hesitate to allow, that it is +completely in the power of others to prevent such exchanges, and to +destroy entirely the advantages which would otherwise result from +the application of individual or national industry, to peculiar and +appropriate products. +</P> + +<P> +Let us suppose, for instance, that the inhabitants of the Lowlands +of Scotland were to say to the Highlanders, 'We will exchange our +corn for your cattle, whenever we have a superfluity; but if our +crops in any degree fail, you must not expect to have a single +grain': would not the question respecting the policy of the present +change, which is taking place in the Highlands, rest entirely upon +different grounds? Would it not be perfectly senseless in the +Highlanders to think only of those general principles which direct +them to employ the soil in the way that is best suited to it? If +supplies of corn could not be obtained with some degree of +steadiness and certainty from other quarters, would it not be +absolutely necessary for them to grow it themselves, however ill +adapted to it might be their soil and climate? +</P> + +<P> +The same may be said of all the pasture districts of Great Britain, +compared with the surrounding corn countries. If they could only +obtain the superfluities of their neighbours, and were entitled to +no share of the produce when it was scarce, they could not certainly +devote themselves with any degree of safety to their present +occupations. +</P> + +<P> +There is, on this account, a grand difference between the freedom of +the home trade in corn, and the freedom of the foreign trade. A +government of tolerable vigour can make the home trade in corn +really free. It can secure to the pasture districts, or the towns +that must be fed from a distance, their share of the general +produce, whether plentiful or scarce. It can set them quite at rest +about the power of exchanging the peculiar products of their own +labour for the other products which are necessary to them, and can +dispense, therefore, to all its subjects, the inestimable advantages +of an unrestricted intercourse. +</P> + +<P> +But it is not in the power of any single nation to secure the +freedom of the foreign trade in corn. To accomplish this, the +concurrence of many others is necessary; and this concurrence, the +fears and jealousies so universally prevalent about the means of +subsistence, almost invariably prevent. There is hardly a nation in +Europe which does not occasionally exercise the power of stopping +entirely, or heavily taxing, its exports of grain, if prohibitions +do not form part of its general code of laws. +</P> + +<P> +The question then before us is evidently a special, not a general +one. It is not a question between the advantages of a free trade, +and a system of restrictions; but between a specific system of +restrictions formed by ourselves for the purpose of rendering us, in +average years, nearly independent of foreign supplies, and the +specific system of restricted importations, which alone it is in our +power to obtain under the existing laws of France, and in the actual +state of the other countries of the continent.(8*) +</P> + +<P> +In looking, in the first place, at the resources of the country, +with a view to an independent supply for an increasing population; +and comparing subsequently the advantages of the two systems +abovementioned, without overlooking their disadvantages, I have +fully made up my mind as to the side on which the balance lies; and +am decidedly of opinion, that a system of restrictions so calculated +as to keep us, in average years, nearly independent of foreign +supplies of corn, will more effectually conduce to the wealth and +prosperity of the country, and of by far the greatest mass of the +inhabitants, than the opening of our ports for the free admission of +foreign corn, in the actual state of Europe. +</P> + +<P> +Of the resources of Great Britain and Ireland for the further growth +of corn, by the further application of capital to the land, the +evidence laid before parliament furnishes the most ample testimony. +But it is not necessary, for this purpose, to recur to evidence that +may be considered as partial. All the most intelligent works which +have been written on agricultural subjects of late years, agree in +the same statements; and they are confirmed beyond a possibility of +doubt, when we consider the extraordinary improvements, and +prodigious increase of produce that have taken place latterly in +some districts, which, in point of natural soil, are not superior to +others that are still yielding the most scanty and miserable crops. +Most of the light soils of the kingdom might, with adequate capital +and skill, be made to equal the improved parts of Norfolk; and the +vast tracts of clay lands that are yet in a degraded state almost +all over the kingdom, are susceptible of a degree of improvement, +which it is by no means easy to fix, but which certainly offers a +great prospective increase of produce. There is even a chance (but +on this I will not insist) of a diminution in the real price of +corn,(9*) owing to the extension of those great improvements, and +that great economy and good management of labour, of which we have +such intelligent accounts from Scotland.(10*) If these clay lands, +by draining, and the plentiful application of lime and other +manures, could be so far meliorated in quality as to admit of being +worked by two horses and a single man, instead of three or four +horses with a man and a boy, what a vast saving of labour and +expense would at once be effected, at the same time that the crops +would be prodigiously increased! And such an improvement may +rationally be expected, from what has really been accomplished in +particular districts. In short, if merely the best modes of +cultivation, now in use in some parts of Great Britain, were +generally extended, and the whole country was brought to a level, in +proportion to its natural advantages of soil and situation, by the +further accumulation and more equable distribution of capital and +skill; the quantity of additional produce would be immense, and +would afford the means of subsistence to a very great increase of +population. +</P> + +<P> +In some countries possessed of a small territory, and consisting +perhaps chiefly of one or two large cities, it never can be made a +question, whether or not they should freely import foreign corn. +They exist, in fact, by this importation; and being always, in point +of population, inconsiderable, they may, in general, rely upon a +pretty regular supply. But whether regular or not, they have no +choice. Nature has clearly told them, that if they increase in +wealth and power to any extent, it can only be by living upon the +raw produce of other countries. +</P> + +<P> +It is quite evident that the same alternative is not presented to +Great Britain and Ireland, and that the united empire has ample +means of increasing in wealth, population, and power, for a very +long course of years, without being habitually dependent upon +foreign supplies for the means of supporting its inhabitants. +</P> + +<P> +As we have clearly, therefore, our choice between two systems, under +either of which we may certainly look forwards to a progressive +increase of population and power; it remains for us to consider in +which way the greatest portion of wealth and happiness may be +steadily secured to the largest mass of the people. +</P> + +<P> +1. And first let us look to the labouring classes of society, as the +foundation on which the whole fabric rests; and, from their numbers, +unquestionably of the greatest weight, in any estimate of national +happiness. +</P> + +<P> +If I were convinced, that to open our ports, would be permanently to +improve the condition of the labouring classes of society, I should +consider the question as at once determined in favour of such a +measure. But I own it appears to me, after the most deliberate +attention to the subject, that it will be attended with effects very +different from those of improvement. We are very apt to be deceived +by names, and to be captivated with the idea of cheapness, without +reflecting that the term is merely relative, and that it is very +possible for a people to be miserably poor, and some of them +starving, in a country where the money price of corn is very low. Of +this the histories of Europe and Asia will afford abundant +instances. +</P> + +<P> +In considering the condition of the lower classes of society, we +must consider only the real exchangeable value of labour; that is, +its power of commanding the necessaries, conveniences, and luxuries +of life. +</P> + +<P> +I stated in the Observations, and more at large in the Inquiry into +rents,(11*) that under the same demand for labour, and the same +consequent power of purchasing the means of subsistence, a high +money price of corn would give the labourer a very great advantage +in the purchase of the conveniences and luxuries of life. The effect +of this high money price would not, of course, be so marked among +the very poorest of the society, and those who had the largest +families; because so very great a part of their earnings must be +employed in absolute necessaries. But to all those above the very +poorest, the advantage of wages resulting from a price of eighty +shillings a quarter for wheat, compared with fifty or sixty, would +in the purchase of tea, sugar, cotton, linens, soap, candles, and +many other articles, be such as to make their condition decidedly +superior. +</P> + +<P> +Nothing could counterbalance this, but a much greater demand for +labour; and such an increased demand, in consequence of the opening +of our ports, is at best problematical. The check to cultivation has +been so sudden and decisive, as already to throw a great number of +agricultural labourers out of employment;(12*) and in Ireland this +effect has taken place to such a degree, as to threaten the most +distressing, and even alarming, consequences. The farmers, in some +districts, have entirely lost the little capital they possessed; +and, unable to continue in their farms, have deserted them, and left +their labourers without the means of employment. In a country, the +peculiar defects of which were already a deficiency of capital, and +a redundancy of population, such a check to the means of employing +labour must be attended with no common distress. In Ireland, it is +quite certain, that there are no mercantile capitals ready to take +up those persons who are thus thrown out of work, and even in Great +Britain the transfer will be slow and difficult. +</P> + +<P> +Our commerce and manufactures, therefore, must increase very +considerably before they can restore the demand for labour already +lost; for the and a moderate increase beyond this will scarcely make +up disadvantage of a low money price of wages. +</P> + +<P> +These wages will finally be determined by the usual money price of +corn, and the state of the demand for labour. +</P> + +<P> +There is a difference between what may be called the usual price of +corn and the average price, which has not been sufficiently attended +to. Let us suppose the common price of corn, for four years out of +five, to be about L2 a quarter, and during the fifth year to be L6. +The average price of the five years will then be L2 16s.; but the +usual price will still be about L2, and it is by this price, and not +by the price of a year of scarcity, or even the average including +it, that wages are generally regulated. +</P> + +<P> +If the ports were open, the usual price of corn would certainly +fall, and probably the average price; but from at has before been +said of the existing laws of France, and of the practice among the +Baltic nations of raising the tax on their exported corn in +proportion to the demand for it, there is every reason to believe, +that the fluctuations of price would be much greater. Such would, at +least, be my conclusion from theory; and, I think, it has been +confirmed by the experience of the last hundred years. During this +time, the period of our greatest importations, and of our greatest +dependence upon foreign corn, was from 1792 to 1805 inclusive; and +certainly in no fourteen years of the whole hundred were the +fluctuations of price so great. In 1792 the price was 42s. a +quarter; in 1796, 77s.; in 1801, 118s. a quarter; and, in 1803, 56s. +Between the year 1792 and 1801 the rise was almost a triple, and in +the short period from 1798 to 1803, it rose from 50s. to 118s. and +fell again to 56s.(13*) +</P> + +<P> +I would not insist upon this existence as absolutely conclusive, on +account of the mixture of accident in all such appeals to facts; but +it certainly tends to confirm the probability of those great +fluctuations which, according to all general principles, I should +expect from the temper and customs of nations, with regard to the +egress of corn, when it is scarce; and particularly from the +existing laws of that country, which, in all common years, will +furnish us with a large proportion of our supplies. +</P> + +<P> +To these causes of temporary fluctuations, during peace, should be +added the more durable as well as temporary, fluctuations occasioned +by war. Without reference to the danger of excessive scarcity from +another combination against us, if we are merely driven back at +certain distant intervals upon our own resources, the experience of +the present times will teach us not to estimate lightly the +convulsion which attends the return, and the evils of such +alternations of price. +</P> + +<P> +In the Observations, I mentioned some causes of fluctuations which +would attend the system of restrictions; but they are in my opinion +inconsiderable, compared with those which have been just referred +to. +</P> + +<P> +On the labouring classes, therefore, the effects of opening our +ports for the free importation of foreign corn, will be greatly to +lower their wages, and to subject them to much greater fluctuations +of price. And, in this state of things, it will require a much +greater increase in the demand for labour, than there is in any +rational ground for expecting, to compensate to the labourer the +advantages which he loses in the high money wages of labour, and the +steadier and less fluctuating price of corn. +</P> + +<P> +2. Of the next most important class of society, those who live upon +the profits of stock, one half probably are farmers, or immediately +connected with farmers; and of the property of the other half, not +above one fourth is engaged in foreign trade. +</P> + +<P> +Of the farmers it is needless to say anything. It cannot be doubted +that they will suffer severely from the opening of the ports. Not +that the profits of farming will not recover themselves, after a +certain period, and be as great, or perhaps greater, than they were +before; but this cannot take place till after a great loss of +agricultural capital, or the removal of it into the channels of +commerce and manufactures. +</P> + +<P> +Of the commercial and manufacturing part of the society, only those +who are directly engaged in foreign trade, will feel the benefit of +the importing system. It is of course to be expected, that the +foreign trade of the nation will increase considerably. If it do +not, indeed, we shall have experienced a very severe loss, without +anything like a compensation for it. And if this increase merely +equals the loss of produce sustained by agriculture, the quantity of +other produce remaining the same, it is quite clear that the country +cannot possibly gain by the exchange, at whatever price it may buy +or sell. Wealth does not consist in the dearness or cheapness of the +usual measure of value, but in the quantity of produce; and to +increase effectively this quantity of produce, after the severe +check sustained by agriculture, it is necessary that commerce should +make a very powerful start. +</P> + +<P> +In the actual state of Europe and the prevailing jealousy of our +manufactures, such a start seems quite doubtful; and it is by no +means impossible that we shall be obliged to pay for our foreign +corn, by importing less of other commodities, as well as by +exporting more of our manufactures. +</P> + +<P> +It may be said, perhaps, that a fall in the price of our corn and +labour, affords the only chance to our manufacturers of retaining +possession of the foreign markets; and that though the produce of +the country may not be increased by the fall in the price of corn, +such a fall is necessary to prevent a positive diminution of it. +There is some weight undoubtedly in this argument. But if we look at +the probable effects of returning peace to Europe, it is impossible +to suppose that, even with a considerable diminution in the price of +labour, we should not lose some markets on the continent, for those +manufactures in which we have no peculiar advantage; while we have +every reason to believe that in others, where our colonies, our +navigation, our long credits, our coals, and our mines come in +question, as well as our skill and capital, we shall retain our +trade in spite of high wages. Under these circumstances, it seems +peculiarly advisable to maintain unimpaired, if possible, the home +market, and not to lose the demand occasioned by so much of the +rents of land, and of the profits and capital of farmers, as must +necessarily be destroyed by the check to our home produce. +</P> + +<P> +But in whatever way the country may be affected by the change, we +must suppose that those who are immediately engaged in foreign trade +will benefit by it. As those, however, form but a very small portion +of the class of persons living on the profits of stock, in point of +number, and not probably above a seventh or eighth in point of +property, their interests cannot be allowed to weigh against the +interests of so very large a majority. +</P> + +<P> +With regard to this great majority, it is impossible that they +should not feel very widely and severely the diminution of their +nominal capital by the fall of prices. We know the magic effect upon +industry of a rise of prices. It has been noticed by Hume, and +witnessed by every person who has attended to subjects of this kind. +And the effects of a fall are proportionately depressing. Even the +foreign trade will not escape its influence, though here it may be +counterbalanced by a real increase of demand. But, in the internal +trade, not only will the full effect of this deadening weight be +experienced, but there is reason to fear that it may be accompanied +with an actual diminution of home demand. There may be the same or +even a greater quantity of corn consumed in the country, but a +smaller quantity of manufactures and colonial produce; and our +foreign corn may be purchased in part by commodities which were +before consumed at home. In this case, the whole of the internal +trade must severely suffer, and the wealth and enjoyments of the +country be decidedly diminished. The quantity of a country's exports +is a very uncertain criterion of its wealth. The quantity of produce +permanently consumed at home is, perhaps, the most certain criterion +of wealth to which we can refer. +</P> + +<P> +Already, in all the country towns, this diminution of demand has +been felt in a very great degree; and the surrounding farmers, who +chiefly support them, are quite unable to make their accustomed +purchases. If the home produce of grain be considerably diminished +by the opening of our ports, of which there can be no doubt, these +effects in the agricultural countries must be permanent, though not +to the same extent as at present. And even if the manufacturing +towns should ultimately increase, in proportion to the losses of the +country, of which there is great reason to doubt, the transfer of +wealth and population will be slow, painful, and unfavourable to +happiness. +</P> + +<P> +3. Of the class of landholders, it may be truly said, that though +they do not so actively contribute to the production of wealth, as +either of the classes just noticed, there is no class in society +whose interests are more nearly and intimately connected with the +prosperity of the state. +</P> + +<P> +Some persons have been of opinion, and Adam Smith himself among +others, that a rise or fall of the price of corn does not really +affect the interests of the landholders; but both theory and +experience prove the contrary; and shew, that, under all common +circumstances, a fall of price must be attended with a diminution of +produce, and that a diminution of produce will naturally be attended +with a diminution of rent.(14*) +</P> + +<P> +Of the effect, therefore, of opening the ports, in diminishing both +the real and nominal rents of the landlords, there can be no doubt; +and we must not imagine that the interest of a body of men, so +circumstanced as the landlords, can materially suffer without +affecting the interests of the state. +</P> + +<P> +It has been justly observed by Adam Smith, that 'no equal quantity +of productive labour employed in manufactures can ever occasion so +great a reproduction as in agriculture.' If we suppose the rents of +land taken throughout the kingdom to be one fourth of the gross +produce, it is evident, that to purchase the same value of raw +produce by means of manufactures, would require one third more +capital. Every five thousand pounds laid out on the land, not only +repays the usual profits of stock, but generates an additional +value, which goes to the landlord. And this additional value is not +a mere benefit to a particular individual, or set of individuals, +but affords the most steady home demand for the manufactures of the +country, the most effective fund for its financial support, and the +largest disposable force for its army and navy. It is true, that the +last additions to the agricultural produce of an improving country +are not attended with a large proportion of rent;(15*) and it is +precisely this circumstance that may make it answer to a rich +country to import some of its corn, if it can be secure of obtaining +an equable supply. But in all cases the importation of foreign corn +must fail to answer nationally, if it is not so much cheaper than +the corn that can be grown at home, as to equal both the profits and +the rent of the grain which it displaces. +</P> + +<P> +If two capitals of ten thousand pounds each, be employed, one in +manufactures, and the other in the improvement of the land, with the +usual profits, and withdrawn in twenty years, the one employed in +manufactures will leave nothing behind it, while the one employed on +the land will probably leave a rent of no inconsiderable value. +</P> + +<P> +These considerations, which are not often attended to, if they do +not affect the ordinary question of a free trade in corn, must at +least be allowed to have weight, when the policy of such a trade is, +from peculiarity of situation and circumstances, rendered doubtful. +</P> + +<P> +4. We now come to a class of society, who will unquestionably be +benefited by the opening of our ports. These are the stockholders, +and those who live upon fixed salaries.(16*) They are not only, +however, small in number, compared with those who will be affected +in a different manner; but their interests are not so closely +interwoven with the welfare of the state, as the classes already +considered, particularly the labouring classes, and the landlords. +</P> + +<P> +In the Observations, I remarked, that it was 'an error of the most +serious magnitude to suppose that any natural or artificial causes, +which should raise or lower the values of corn or silver, might be +considered as matters of indifference; and that, practically, no +material change could take place in the value of either, without +producing both temporary and lasting effects, which have a most +powerful influence on the distribution of property.' +</P> + +<P> +In fact, it is perfectly impossible to suppose that, in any change +in the measure of value, which ever did, or ever can take place +practically, all articles, both foreign and domestic, and all +incomes, from whatever source derived, should arrange themselves +precisely in the same relative proportions as before. And if they do +not, it is quite obvious, that such a change may occasion the most +marked differences in the command possessed by individuals and +classes of individuals over the produce and wealth of the country. +Sometimes the changes of this kind that actually take place, are +favourable to the industrious classes of society, and sometimes +unfavourable. +</P> + +<P> +It can scarcely be doubted, that one of the main causes, which has +enabled us hitherto to support, with almost undiminished resources, +the prodigious weight of debt which has been accumulated during the +last twenty years, is the continued depreciation of the measure in +which it has been estimated, and the great stimulus to industry, and +power of accumulation, which have been given to the industrious +classes of society by the progressive rise of prices. As far as this +was occasioned by excessive issues of paper, the stockholder was +unjustly treated, and the industrious classes of society benefited +unfairly at his expense. But, on the other hand, if the price of +corn were now to fall to 50 shillings a quarter, and labour and +other commodities nearly in proportion, there can be no doubt that +the stockholder would be benefited unfairly at the expense of the +industrious classes of society, and consequently at the expense of +the wealth and prosperity of the whole country. +</P> + +<P> +During the twenty years, beginning with 1794 and ending with 1813, +the average price of British corn per quarter was about eighty-three +shillings; during the ten years ending with 1813, ninety-two +shillings; and during the last five years of the twenty, one hundred +and eight shillings. In the course of these twenty years, the +government borrowed near five hundred millions of real capital, for +which on a rough average, exclusive of the sinking fund, it engaged +to pay about five per cent. But if corn should fall to fifty +shillings a quarter, and other commodities in proportion, instead of +an interest of about five per cent. the government would really pay +an interest of seven, eight, nine, and for the last two hundred +millions, ten per cent. +</P> + +<P> +To this extraordinary generosity towards the stockholders, I should +be disposed to make no kind of objection, if it were not necessary +to consider by whom it is to be paid; and a moment's reflection will +shew us, that it can only be paid by the industrious classes of +society and the landlords, that is, by all those whose nominal +incomes will vary with the variations in the measure of value. The +nominal revenues of this part of the society, compared with the +average of the last five years, will be diminished one half; and out +of this nominally reduced income, they will have to pay the same +nominal amount of taxation. +</P> + +<P> +The interest and charges of the national debt, including the sinking +fund, are now little short of L40 millions a year; and these L40 +millions, if we completely succeed in the reduction of the price of +corn and labour, are to be paid in future from a revenue of about +half the nominal value of the national income in 1813. +</P> + +<P> +If we consider, with what an increased weight the taxes on tea, +sugar, malt, leather, soap, candles, etc., etc. would in this case +bear on the labouring classes of society, and what proportion of +their incomes all the active, industrious middle orders of the +state, as well as the higher orders, must pay in assessed taxes, and +the various articles of the customs and excise, the pressure will +appear to be absolutely intolerable. Nor would even the ad valorem +taxes afford any real relief. The annual fourty millions, must at +all events be paid; and if some taxes fail, others must be imposed +that will be more productive. +</P> + +<P> +These are considerations sufficient to alarm even the stockholders +themselves, indeed, if the measure of value were really to fall, as +we have supposed, there is great reason to fear that the country +would be absolutely unable to continue the payment of the present +interest of the national debt. +</P> + +<P> +I certainly do not think, that by opening our ports to the freest +admission of foreign corn, we shall lower the price to fifty +shillings a quarter. I have already given my reasons for believing +that the fluctuations which in the present state of Europe, a system +of importation would bring with it, would be often producing dear +years, and throwing us back again upon our internal resources. But +still there is no doubt whatever, that a free influx of foreign +grain would in all commonly favourable seasons very much lower its +price. +</P> + +<P> +Let us suppose it lowered to sixty shillings a quarter, which for +periods of three or four years together is not improbable. The +difference between a measure of value at 60 compared with 80 (the +price at which it is proposed to fix the importation), is 33 1/3 per +cent. This percentage upon 40 millions amounts to a very formidable +sum. But let us suppose that corn does not effectually regulate the +prices of other commodities; and, making allowances on this account, +let us take only 25, or even 20 per cent. Twenty per cent. upon 40 +millions amounts at once to 8 millions—a sum which ought to go a +considerable way towards a peace establishment; but which, in the +present case, must go to pay the additional interest of the national +debt, occasioned by the change in the measure of value. And even if +the price of corn be kept up by restrictions to 80 shillings a +quarter, it is certain that the whole of the loans made during the +war just terminated, will on an average, be paid at an interest very +much higher than they were contracted for; which increased interest +can, of course, only be furnished by the industrious classes of +society. +</P> + +<P> +I own it appears to me that the necessary effect of a change in the +measure of value on the weight of a large national debt is alone +sufficient to make the question fundamentally different from that of +a simple question about a free or restricted trade; and, that to +consider it merely in this light, and to draw our conclusions +accordingly, is to expect the same results from premises which have +essentially changed their nature. From this review of the manner in +which the different classes of society will be affected by the +opening of our ports, I think it appears clearly, that very much the +largest mass of the people, and particularly of the industrious +orders of the state, will be more injured than benefited by the +measure. +</P> + +<P> +I have now stated the grounds on which it appears to me to be wise +and politic, in the actual circumstances of the country, to restrain +the free importation of foreign corn. +</P> + +<P> +To put some stop to the progressive loss of agricultural capital, +which is now taking place, and which it will be by no means easy to +recover, it might be advisable to pass a temporary act of +restriction, whatever may be the intention of the legislature in +future. But, certainly it is much to be wished that as soon as +possible, consistently with due deliberation, the permanent policy +intended to be adopted with regard to the trade in corn should be +finally settled. Already, in the course of little more than a +century, three distinct changes in this policy have taken place. The +act of William, which gave the bounty, combined with the prohibitory +act of Charles II was founded obviously and strikingly upon the +principle of encouraging exportation and discouraging importation; +the spirit of the regulations adopted in 1773, and acted upon some +time before, was nearly the reverse, and encouraged importation and +discouraged exportation. Subsequently, as if alarmed at the +dependence of the country upon foreign corn, and the fluctuations of +price which it had occasioned, the legislature in a feeble act of +1791, and rather a more effective one in 1804, returned again to the +policy of restrictions. And if the act of 1804 be left now +unaltered, it may be fairly said that a fourth change has taken +place; as it is quite certain that, to proceed consistently upon a +restrictive system, fresh regulations become absolutely necessary to +keep pace with the progressive fall in the value of currency. +</P> + +<P> +Such changes in the spirit of our legislative enactments are much to +be deprecated; and with a view to a greater degree of steadiness in +future, it is quite necessary that we should be so fully prepared +for the consequences which belong to each system, as not to have our +determinations shaken by them, when they occur. +</P> + +<P> +If, upon mature deliberation, we determine to open our ports to the +free admission of foreign grain, we must not be disturbed at the +depressed state, and diminished produce of our home cultivation; we +must not be disturbed at our becoming more and more dependent upon +other nations for the main support of our population; we must not be +disturbed at the greatly increased pressure of the national debt +upon the national industry; and we must not be disturbed at the +fluctuations of price, occasioned by the very variable supplies, +which we shall necessarily receive from France, in the actual state +of her laws, or by the difficulty and expense of procuring large, +and sudden imports from the Baltic, when our wants are pressing. +These consequences may all be distinctly foreseen. Upon all general +principles, they belong to the opening of our ports, in the actual +state and relations of this country to the other countries of +Europe; and though they may be counterbalanced or more than +counterbalanced, by other advantages, they cannot, in the nature of +things, be avoided. +</P> + +<P> +On the other hand, if, on mature deliberation, we determine steadily +to pursue a system of restrictions with regard to the trade in corn, +we must not be disturbed at a progressive rise in the price of +grain; we must not be disturbed at the necessity of altering, at +certain intervals, our restrictive laws according to the state of +the currency, and the value of the precious metals; we must not be +disturbed at the progressive diminution of fixed incomes; and we +must not be disturbed at the occasional loss or diminution of a +continental market for some of our least peculiar manufactures, +owing to the high price of our labour.(17*) All these disadvantages +may be distinctly foreseen. According to all general principles they +strictly belong to the system adopted; and, though they may be +counterbalanced, and more than counterbalanced, by other greater +advantages, they cannot, in the nature of things, be avoided, if we +continue to increase in wealth and population. +</P> + +<P> +Those who promise low prices upon the restrictive system, take an +erroneous view of the causes which determine the prices of raw +produce, and draw an incorrect inference from the experience of the +first half of the last century. As I have stated in another +place,(18*) a nation which very greatly gets the start of its +neighbours in riches, without any peculiar natural facilities for +growing corn, must necessarily submit to one of these +alternatives—either a very high comparative price of grain, or a +very great dependence upon other countries for it. +</P> + +<P> +With regard to the specific mode of regulating the importation of +corn, if the restrictive system be adopted, I am not sufficiently +acquainted with the details of the subject to be able to speak with +confidence. It seems to be generally agreed, that, in the actual +state of things, a price of about eighty shillings a quarter(19*) +would prevent our cultivation from falling back, and perhaps allow +it to be progressive. But, in future, we should endeavour, if +possible, to avoid all discussions about the necessity of protecting +the British farmer, and securing to him a fair living profit. Such +language may perhaps be allowable in a crisis like the present. But +certainly the legislature has nothing to do with securing to any +classes of its subjects a particular rate of profits in their +different trades. This is not the province of a government; and it +is unfortunate that any language should be used which may convey +such an impression, and make people believe that their rulers ought +to listen to the accounts of their gains and losses. +</P> + +<P> +But a government may certainly see sufficient reasons for wishing to +secure an independent supply of grain. This is a definite, and may +be a desirable, object, of the same nature as the Navigation Act; +and it is much to be wished, that this object, and not the interests +of farmers and landlords, should be the ostensible, as well as the +real, end which we have in view, in all our inquiries and +proceedings relating to the trade in corn. +</P> + +<P> +I firmly believe that, in the actual state of Europe, and under the +actual circumstances of our present situation, it is our wisest +policy to grow our own average supply of corn; and, in so doing, I +feel persuaded that the country has ample resources for a great and +continued increase of population, of power, of wealth, and of +happiness. +</P> + +<BR><BR><BR> + +<H3> +NOTES: +</H3> + +<P CLASS="noindent"> +1. Some of my friends were of different opinions as to the side, +towards which my arguments most inclined. This I consider as a +tolerably fair proof of impartiality. +</P> + +<P CLASS="noindent"> +2. Mercantile losses are always comparatively partial; but the +present losses, occasioned by the unusual combination of low prices, +and scanty produce, must inflict a severe blow upon the whole mass +of cultivators. There never, perhaps, was known a year more +injurious to the interests of agriculture. +</P> + +<P CLASS="noindent"> +3. At the same time, I certainly now very much wish that some +regulation had been adopted last year. It would have saved the +nation a great loss of agricultural capital, which it will take some +time to recover. But it was impossible to foresee such a year as the +present—such a combination, as a very bad harvest, and very low +prices. +</P> + +<P CLASS="noindent"> +4. I have very little doubt that the value of paper in this country +has already risen, norwithstanding the increased issues of the Bank. +These increased issues I attribute chiefly to the great failures +which have taken place among country banks, and the very great +purchases which have been made for the continental markets, and, +under these circumstances, increased issues might take place, +accompanied even by a rise of value. But the currency has not yet +recovered itself. The real exchange, during the last year, must have +been greatly in our favour, although the nominal exchange is +considerably against us. This shews, incontrovertibly, that our +currency is still depreciated, in reference to the bullion +currencies of the continent. A part, however, of this depreciation +may still be owing to the value of bullion in Europe not having yet +fallen to its former level. +</P> + +<P CLASS="noindent"> +5. Calculated at twenty-four livres the pound sterling. +</P> + +<P CLASS="noindent"> +6. It has been supposed by some, that this law cannot, and will not +be executed: but I own I see no grounds for such an opinion. It is +difficult to execute prohibitions against the exportation of corn, +when it is in great plenty, but not when it is scarce. For ten years +before 1757, we had in this country, regularly exported on an +average, above 400,000 quarters of wheat, and in that year there was +at once an excess of importation. With regard to the alleged +impotence of governments in this respect, it appears to me that +facts shew their power rather than their weakness. To be convinced +of this, it is only necessary to look at the diminished importations +from America during the war, and particularly from the Baltic after +Bonaparte's decrees. The imports from France and the Baltic in 1810, +were by special licences, granted for purposes of revenue. Such +licences shewed strength rather than weakness; and might have been +refused, if a greater object than revenue had at that time presented +itself. +</P> + +<P CLASS="noindent"> +7. The average is 16 francs, 21 centimes, the Hectolitre. The +Hectolitre is about 1-20th less than 3 Winchester bushels, which +makes the English quarter come to about 38 shillings. +</P> + +<P CLASS="noindent"> +8. It appears from the evidence, that the corn from the Baltic is +often very heavily taxed, and that this tax is generally raised in +proportion to our necessities. In a scarce year in this country we +could never get any considerable quantity of corn from the Baltic, +without paying an enormous price for it. +</P> + +<P CLASS="noindent"> +9. By the real growing price of corn I mean the real quantity of +labour and capital which has been employed to procure the last +additions which have been made to the national produce. In every +rich and improving country there is a natural and strong tendency to +a constantly increasing price of raw produce, owing to the necessity +of employing, progressively, land of an inferior quality. But this +tendency may be partially counteracted by great improvements in +cultivation, and economy of labour. See this subject treated in An +inquiry into the nature and progress of rent, just published. +</P> + +<P CLASS="noindent"> +10. Sir John Sinclair's Account of the Husbandry of Scotland: and +the General Report of Scotland. +</P> + +<P CLASS="noindent"> +11. "Inquiry into the Nature and Progress of Rent, and the +Principles by which it is regulated." +</P> + +<P CLASS="noindent"> +12. I was not prepared to expect (as I intimated in the +Observations) so sudden a fall in the price of labour as has already +taken place. This fall has been occasioned, not so much by the low +price of corn, as by the sudden stagnation of agricultural work, +occasioned by a more sudden check to cultivation than I foresaw. +</P> + +<P CLASS="noindent"> +13. I am strongly disposed to believe, that it is owning to the +unwillingness of governments to allow the free egress of their corn, +when it is scarce, that nations are practically so little dependent +upon each other for corn, as they are found to be. According to all +general principles they ought to be more dependent. But the great +fluctuations in the price of corn, occasioned by this unwillingness, +tend to throw each country back again upon its internal resources. +This was remarkably the case with us in 1800 and 1801, when the very +high price, which we paid for foreign corn, gave a prodigious +stimulus to our domestic agriculture. A large territorial country, +that imports foreign corn, is exposed not infrequently to the +fluctuations which belong to this kind of variable dependence, +without obtaining the cheapness that ought to accompany a trade in +corn really free. +</P> + +<P CLASS="noindent"> +14. See this subject treated in An Inquiry into the Nature and +Progress of Rents. +</P> + +<P CLASS="noindent"> +15. Inquiry into the Nature and Progress of Rent. +</P> + +<P CLASS="noindent"> +16. It is to this class of persons that I consider myself as chiefly +belonging. Much the greatest part of my income is derived from a +fixed salary and the interest of money in the funds. +</P> + +<P CLASS="noindent"> +17. It often happens that the high prices of a particular country +may diminish the quantity of its exports without diminishing the +value of their amount abroad; in which case its foreign trade is +peculiarly advantageous, as it purchases the same amount of foreign +commodities at a much less expense of labour and capital. +</P> + +<P CLASS="noindent"> +18. Inquiry into the Nature and Progress of Rent. +</P> + +<P CLASS="noindent"> +19. This price seems to be pretty fairly consistent with the idea of +getting rid of that part of our high prices which belongs to +excessive issues of paper, and retaining only that part which +belongs to great wealth, combined with a system of restrictions. +</P> + +<BR><BR><BR><BR> + + + + + + + + +<pre> + + + + + +End of the Project Gutenberg EBook of The Grounds of an Opinion on the +Policy of Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws", by Thomas Malthus + +*** END OF THIS PROJECT GUTENBERG EBOOK IMPORTATION OF FOREIGN CORN *** + +***** This file should be named 4335-h.htm or 4335-h.zip ***** +This and all associated files of various formats will be found in: + https://www.gutenberg.org/4/3/3/4335/ + +Produced by Charles Aldarondo. 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You may copy it, give it away or +re-use it under the terms of the Project Gutenberg License included +with this eBook or online at www.gutenberg.org + + +Title: The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws" + +Author: Thomas Malthus + +Posting Date: July 25, 2009 [EBook #4335] +Release Date: August, 2003 +First Posted: January 11, 2002 + +Language: English + +Character set encoding: ASCII + +*** START OF THIS PROJECT GUTENBERG EBOOK IMPORTATION OF FOREIGN CORN *** + + + + +Produced by Charles Aldarondo. HTML version by Al Haines. + + + + + + + + + +The Grounds of an Opinion on the Policy of Restricting the +Importation of Foreign Corn; intended as an Appendix to +"Observations on the Corn Law" + +by the Rev. T.R. Malthus, + +Professor of History and Political Economy +in the East India College, Hertfordshire. + + + +London: Printed for John Murray, Albermarle Street, and J. Johnson +and Co., St. Paul's Church Yard, 1815. + + + + + + +Grounds, &c. + + +The professed object of the Observations on the Corn Laws, which I +published in the spring of 1814, was to state with the strictest +impartiality the advantages and disadvantages which, in the actual +circumstances of our present situation, were likely to attend the +measures under consideration, respecting the trade in corn. + +A fair review of both sides of the question, without any attempt to +conceal the peculiar evils, whether temporary or permanent, which +might belong to each, appeared to me of use, not only to assist in +forming an enlightened decision on the subject, but particularly to +prepare the public for the specific consequences which were to be +expected from that decision, on whatever side it might be made. Such +a preparation, from some quarter or other, seemed to be necessary, +to prevent those just discontents which would naturally have arisen, +if the measure adopted had been attended with results very different +from those which had been promised by its advocates, or contemplated +by the legislature. + +With this object in view, it was neither necessary, nor desirable, +that I should myself express a decided opinion on the subject. It +would hardly, indeed, have been consistent with that character of +impartiality, which I wished to give to my statements, and in which +I have reason to believe I in some degree succeeded.(1*) + +These previous statements, however, having been given, and having, I +hope, shewn that the decision, whenever it is made, must be a +compromise of contending advantages and disadvantages, I have no +objection now to state (without the least reserve), and I can truly +say, wit the most complete freedom from all interested motives, the +grounds of a deliberate, yet decided, opinion in favour of some +restrictions on the importation of foreign corn. + +This opinion has been formed, as I wished the readers of the +Observations to form their opinions, by looking fairly at the +difficulties on both sides of the question; and without vainly +expecting to attain unmixed results, determining on which side there +is the greatest balance of good with the least alloy of evil. The +grounds on which the opinion so formed rests, are partly those which +were stated in the Observations, and partly, and indeed mainly, some +facts which have occurred during the last year, and which have +given, as I think, a decisive weight to the side of restrictions. + +These additional facts are-- + +1st, The evidence, which has been laid before Parliament, relating +to the effects of the present prices of corn, together with the +experience of the present year. + +2dly, The improved state of our exchanges, and the fall in the price +of bullion. And + +3dly, and mainly, the actual laws respecting the exportation of corn +lately passed in France. + +In the Observations on the corn laws, I endeavoured to shew that, +according to the general principles of supply and demand, a +considerable fall in the price of corn could not take place, without +throwing much poor lad out of cultivation, and effectually +preventing, for a considerable time, all further improvements in +agriculture, which have for their object an increase of produce. + +The general principles, on which I calculated upon these +consequences, have been fully confirmed by the evidence brought +before the two houses of Parliament; and the effects of a +considerable fall in the price of corn, and of the expected +continuance of low prices, have shewn themselves in a very severe +shock to the cultivation of the country and a great loss of +agricultural capital. + +Whatever may be said of the peculiar interests and natural +partialities of those who were called upon to give evidence upon +this occasion, it is impossible not to be convinced, by the whole +body of it taken together, that, during the last twenty years, and +particularly during the last seven, there has been a great increase +of capital laid out upon the land, and a great consequent extension +of cultivation and improvement; that the system of spirited +improvement and high farming, as it is technically called, has been +principally encouraged by the progressive rise of prices owing in a +considerable degree, to the difficulties thrown in the way of +importation of foreign corn by the war; that the rapid accumulation +of capital on the land, which it had occasioned, had so increased +our home growth of corn, that, notwithstanding a great increase of +population, we had become much less dependent upon foreign supplies +for our support; and that the land was still deficient in capital, +and would admit of the employment of such an addition to its present +amount, as would be competent to the full supply of a greatly +increased population: but that the fall of prices, which had lately +taken place, and the alarm of a still further fall, from continued +importation, had not only checked all progress of improvement, but +had already occasioned a considerable loss of agricultural advances; +and that a continuation of low prices would, in spite of a +diminution of rents, unquestionably destroy a great mass of farming +capital all over the country, and essentially diminish its +cultivation and produce. + +It has been sometimes said, that the losses at present sustained by +farmers are merely the natural and necessary consequences of +overtrading, and that they must bear them as all other merchants do, +who have entered into unsuccessful speculations. But surely the +question is not, or at least ought not to be, about the losses and +profits of farmers, and the present condition of landholders +compared with the past. It may be necessary, perhaps, to make +inquiries of this kind, with a view to ulterior objects; but the +real question respects the great loss of national wealth, attributed +to a change in the spirit of our legislative enactments relating to +the admission of foreign corn. + +We have certainly no right to accuse our farmers of rash speculation +for employing so large a capital in agriculture. The peace, it must +be allowed, was most unexpected; and if the war had continued, the +actual quantity of capital applied to the land, might have been as +necessary to save the country from extreme want in future, as it +obviously was in 1812, when, with the price of corn at above six +guineas a quarter, we could only import a little more than 100,000 +quarters. If, from the very great extension of cultivation, during +the four or five preceding years, we had not obtained a very great +increase of average produce, the distresses of that year would have +assumed a most serious aspect. + +There is certainly no one cause which can affect mercantile +concerns, at all comparable in the extent of its effects, to the +cause now operating upon agricultural capital. Individual losses +must have the same distressing consequences in both cases, and they +are often more complete, and the fall is greater, in the shocks of +commerce. But I doubt, whether in the most extensive mercantile +distress that ever took in this country, there was ever one fourth +of the property, or one tenth of the number of individuals +concerned, when compared with the effects of the present rapid fall +of raw produce, combined with the very scanty crop of last year.(2*) + +Individual losses of course become national, according as they +affect a greater mass of the national capital, and a greater number +of individuals; and I think it must be allowed further, that no +loss, in proportion to its amount, affects the interest of the +nation so deeply, and vitally, and is so difficult to recover, as +the loss of agricultural capital and produce. + +If it be the intention of the legislature fairly to look at the +evils, as well as the good, which belongs to both sides of the +question, it must be allowed, that the evidence laid before the two +houses of Parliament, and still more particularly the experience of +the last year, shew, that the immediate evils which are capable of +being remedied by a system of restrictions, are of no inconsiderable +magnitude. + +2. In the Observations on the corn laws, I gave, as a reason for +some delay in coming to a final regulation respecting the price at +which foreign corn might be imported, the very uncertain state of +the currency. I observed, that three different importation prices +would be necessary, according as our currency should either rise to +the then price of bullion, should continue at the same nominal +value, or should take an intermediate position, founded on a fall in +the value of bullion, owing to the discontinuance of an +extraordinary demand for it, and a rise in the value of paper, owing +to the prospect of a return to payments in specie. In the course of +this last year, the state of our exchanges, and the fall in the +price of bullion, shew pretty clearly, that the intermediate +alteration which, I then contemplated, greater than in the case +first mentioned, and less than in the second, is the one which might +be adopted with a fair prospect of permanence; and that we should +not now proceed under the same uncertainty respecting the currency, +which we should have done, if we had adopted a final regulation in +the early part of last year.(3*) This intermediate alteration, +however, supposes a rise in the value of paper on a return to cash +payments, and some general fall of prices quite unconnected with any +regulations respecting the corn trade.(4*) + +But, if some fall of prices must take place from this cause, and if +such a fall can never take place without a considerable check to +industry, and discouragement to the accumulation of capital, it +certainly does not seem a well-chosen time for the legislature to +occasion another fall still greater, by departing at once from a +system of restrictions which it had pursued with steadiness during +the greatest part of the last century and, after having given up for +a short period, had adopted again as its final policy in its two +last enactments respecting the trade in corn. Even if it be +intended. Finally, to throw open our ports, it might be wise to pass +some temporary regulations, in order to prevent the very great shock +which must take place, if the two causes here noticed, of the +depreciation of commodities, be allowed to produce their full effect +by contemporaneous action. + +3. I stated, in the Observations on the corn laws, that the +cheapness and steadiness in the price of corn, which were promised +by the advocates of restrictions, were not attainable by the +measures they proposed; that it was really impossible for us to grow +at home a sufficiency for our own consumption, without keeping up +the price of corn considerably above the average of the rest of +Europe; and that, while this was the case, as we could never export +to any advantage, we should always be liable to the variations of +price, occasioned by the glut of a superabundant harvest; in short, +that it must be allowed that a free trade in corn would, in all +ordinary cases, not only secure a cheaper, but a more steady, supply +of grain. + +In expressing this distinct opinion on the effects of a free trade +in corn, I certainly meant to refer to a trade really free--that +is, a trade by which a nation would be entitled to its share of the +produce of the commercial world, according to its means of +purchasing, whether that produce were plentiful or scanty. In this +sense I adhere strictly to the opinion I then gave; but, since that +period, an event has occurred which has shewn, in the clearest +manner, that it is entirely out of our power, even in time of peace, +to obtain a free trade in corn, or an approximation towards it, +whatever may be our wishes on the subject. + +It has, perhaps, not been sufficiently attended to in general, when +the advantages of a free trade in corn have been discussed, that the +jealousies and fears of nations, respecting their means of +subsistence, will very rarely allow of a free egress of corn, when +it is in any degree scarce. Our own statutes, till the very last +year, prove these fears with regard to ourselves; and regulations of +the same tendency occasionally come in aid of popular clamour in +almost all countries of Europe. But the laws respecting the +exportation of corn, which have been passed in France during the +last year, have brought this subject home to us in the most striking +and impressive manner. Our nearest neighbour, possessed of the +largest and finest corn country in Europe, and who, owing to a more +favourable climate and soil, a more stationary and comparatively +less crowded population, and a lighter weight of taxation, can grow +corn at less than half our prices, has enacted, that the exportation +of corn shall be free till the price rises to about forty nine +shillings a quarter,(5*) and that then it shall be entirely +cease.(6*) + +From the vicinity of France, and the cheapness of its corn in all +years of common abundance, it is scarcely possible that our main +imports should not come from that quarter as long as our ports are +open to receive them. In this first year of open trade, our imports +have been such, as to shew, that though the corn of the Baltic +cannot seriously depress our prices in an unfavourable season at +home, the corn of France may make it fall below a growing price, +under the pressure of one of the worst crops that has been known for +a long series of years. + +I have at present before me an extract from a Rouen paper, +containing the prices of corn in fourteen different markets for the +first week in October, the average of which appears to be about +thirty eight shillings a quarter;(7*) and this was after +disturbances had taken place both at Havre and Dieppe, on account of +the quantity exported, and the rise of prices which it had +occasioned. + +It may be said, perhaps, that the last harvest of France has been a +very favourable one, and affords no just criterion of its general +prices. But, from all that I hear, prices have often been as low +during the last ten years. And, an average not exceeding forty +shillings a quarter may, I think, be conclusively inferred from the +price at which exportation is by law to cease. + +At a time when, according to Adam Smith, the growing price in this +country was only twenty eight shillings a quarter, and the average +price, including years of scarcity, only thirty three shillings, +exportation was not prohibited till the price rose to forty eight +shillings. It was the intention of the English government, at that +time, to encourage agriculture by giving vent to its produce. We may +presume that the same motive influenced the government of France in +the late act respecting exportation. And it is fair therefore to +conclude, that the price of wheat, in common years, is considerably +less than the price at which exportation is to cease. + +With these prices so near us, and with the consequent power of +supplying ourselves with great comparative rapidity, which in the +corn trade is a point of the greatest importance, there can be no +doubt that, if our ports were open, our principal supplies of grain +would come from France; and that, in all years of common plenty in +that country, we should import more largely from it than from the +Baltic. But from this quarter, which would then become our main and +most habitual source of supply, all assistance would be at once cut +off, in every season of only moderate scarcity; and we should have +to look to other quarters, from which it is an established fact, +that large sudden supplies cannot be obtained, not only for our +usual imports, and the natural variations which belong to them, but +for those which had been suddenly cut off from France, and which our +habitually deficient growth had now rendered absolutely necessary. + +To open our ports, under these circumstances, is not to obtain a +free trade in corn; and, while I should say, without hesitation, +that a free trade in corn was calculated to produce steadier prices +than the system of restrictions with which it has been compared, I +should, with as little hesitation say, that such a trade in corn, as +has been described, would be subject to much more distressing and +cruel variations, than the most determined system of prohibitions. + +Such a species of commerce in grain shakes the foundations, and +alters entirely the data on which the general principles of free +trade are established. For what do these principles say? They say, +and say most justly, that if every nation were to devote itself +particularly to those kinds of industry and produce, to which its +soil, climate, situation, capital, and skill, were best suited; and +were then freely to exchange these products with each other, it +would be the most certain and efficacious mode, not only of +advancing the wealth and prosperity of the whole body of the +commercial republic with the quickest pace, but of giving to each +individual nation of the body the full and perfect use of all its +resources. + +I am very far indeed from meaning to insinuate, that if we cannot +have the most perfect freedom of trade, we should have none; or that +a great nation must immediately alter its commercial policy, +whenever any of the countries with which it deals passes laws +inconsistent with the principles of freedom. But I protest most +entirely against the doctrine, that we are to pursue our general +principles without ever looking to see if they are applicable to the +case before us; and that in politics and political economy, we are +to go straight forward, as we certainly ought to do in morals, +without any reference to the conduct and proceedings of others. + +There is no person in the least acquainted with political economy, +but must be aware that the advantages resulting from the division of +labour, as applicable to nations as well as individuals, depend +solely and entirely on the power of exchanging subsequently the +products of labour. And no one can hesitate to allow, that it is +completely in the power of others to prevent such exchanges, and to +destroy entirely the advantages which would otherwise result from +the application of individual or national industry, to peculiar and +appropriate products. + +Let us suppose, for instance, that the inhabitants of the Lowlands +of Scotland were to say to the Highlanders, 'We will exchange our +corn for your cattle, whenever we have a superfluity; but if our +crops in any degree fail, you must not expect to have a single +grain': would not the question respecting the policy of the present +change, which is taking place in the Highlands, rest entirely upon +different grounds? Would it not be perfectly senseless in the +Highlanders to think only of those general principles which direct +them to employ the soil in the way that is best suited to it? If +supplies of corn could not be obtained with some degree of +steadiness and certainty from other quarters, would it not be +absolutely necessary for them to grow it themselves, however ill +adapted to it might be their soil and climate? + +The same may be said of all the pasture districts of Great Britain, +compared with the surrounding corn countries. If they could only +obtain the superfluities of their neighbours, and were entitled to +no share of the produce when it was scarce, they could not certainly +devote themselves with any degree of safety to their present +occupations. + +There is, on this account, a grand difference between the freedom of +the home trade in corn, and the freedom of the foreign trade. A +government of tolerable vigour can make the home trade in corn +really free. It can secure to the pasture districts, or the towns +that must be fed from a distance, their share of the general +produce, whether plentiful or scarce. It can set them quite at rest +about the power of exchanging the peculiar products of their own +labour for the other products which are necessary to them, and can +dispense, therefore, to all its subjects, the inestimable advantages +of an unrestricted intercourse. + +But it is not in the power of any single nation to secure the +freedom of the foreign trade in corn. To accomplish this, the +concurrence of many others is necessary; and this concurrence, the +fears and jealousies so universally prevalent about the means of +subsistence, almost invariably prevent. There is hardly a nation in +Europe which does not occasionally exercise the power of stopping +entirely, or heavily taxing, its exports of grain, if prohibitions +do not form part of its general code of laws. + +The question then before us is evidently a special, not a general +one. It is not a question between the advantages of a free trade, +and a system of restrictions; but between a specific system of +restrictions formed by ourselves for the purpose of rendering us, in +average years, nearly independent of foreign supplies, and the +specific system of restricted importations, which alone it is in our +power to obtain under the existing laws of France, and in the actual +state of the other countries of the continent.(8*) + +In looking, in the first place, at the resources of the country, +with a view to an independent supply for an increasing population; +and comparing subsequently the advantages of the two systems +abovementioned, without overlooking their disadvantages, I have +fully made up my mind as to the side on which the balance lies; and +am decidedly of opinion, that a system of restrictions so calculated +as to keep us, in average years, nearly independent of foreign +supplies of corn, will more effectually conduce to the wealth and +prosperity of the country, and of by far the greatest mass of the +inhabitants, than the opening of our ports for the free admission of +foreign corn, in the actual state of Europe. + +Of the resources of Great Britain and Ireland for the further growth +of corn, by the further application of capital to the land, the +evidence laid before parliament furnishes the most ample testimony. +But it is not necessary, for this purpose, to recur to evidence that +may be considered as partial. All the most intelligent works which +have been written on agricultural subjects of late years, agree in +the same statements; and they are confirmed beyond a possibility of +doubt, when we consider the extraordinary improvements, and +prodigious increase of produce that have taken place latterly in +some districts, which, in point of natural soil, are not superior to +others that are still yielding the most scanty and miserable crops. +Most of the light soils of the kingdom might, with adequate capital +and skill, be made to equal the improved parts of Norfolk; and the +vast tracts of clay lands that are yet in a degraded state almost +all over the kingdom, are susceptible of a degree of improvement, +which it is by no means easy to fix, but which certainly offers a +great prospective increase of produce. There is even a chance (but +on this I will not insist) of a diminution in the real price of +corn,(9*) owing to the extension of those great improvements, and +that great economy and good management of labour, of which we have +such intelligent accounts from Scotland.(10*) If these clay lands, +by draining, and the plentiful application of lime and other +manures, could be so far meliorated in quality as to admit of being +worked by two horses and a single man, instead of three or four +horses with a man and a boy, what a vast saving of labour and +expense would at once be effected, at the same time that the crops +would be prodigiously increased! And such an improvement may +rationally be expected, from what has really been accomplished in +particular districts. In short, if merely the best modes of +cultivation, now in use in some parts of Great Britain, were +generally extended, and the whole country was brought to a level, in +proportion to its natural advantages of soil and situation, by the +further accumulation and more equable distribution of capital and +skill; the quantity of additional produce would be immense, and +would afford the means of subsistence to a very great increase of +population. + +In some countries possessed of a small territory, and consisting +perhaps chiefly of one or two large cities, it never can be made a +question, whether or not they should freely import foreign corn. +They exist, in fact, by this importation; and being always, in point +of population, inconsiderable, they may, in general, rely upon a +pretty regular supply. But whether regular or not, they have no +choice. Nature has clearly told them, that if they increase in +wealth and power to any extent, it can only be by living upon the +raw produce of other countries. + +It is quite evident that the same alternative is not presented to +Great Britain and Ireland, and that the united empire has ample +means of increasing in wealth, population, and power, for a very +long course of years, without being habitually dependent upon +foreign supplies for the means of supporting its inhabitants. + +As we have clearly, therefore, our choice between two systems, under +either of which we may certainly look forwards to a progressive +increase of population and power; it remains for us to consider in +which way the greatest portion of wealth and happiness may be +steadily secured to the largest mass of the people. + +1. And first let us look to the labouring classes of society, as the +foundation on which the whole fabric rests; and, from their numbers, +unquestionably of the greatest weight, in any estimate of national +happiness. + +If I were convinced, that to open our ports, would be permanently to +improve the condition of the labouring classes of society, I should +consider the question as at once determined in favour of such a +measure. But I own it appears to me, after the most deliberate +attention to the subject, that it will be attended with effects very +different from those of improvement. We are very apt to be deceived +by names, and to be captivated with the idea of cheapness, without +reflecting that the term is merely relative, and that it is very +possible for a people to be miserably poor, and some of them +starving, in a country where the money price of corn is very low. Of +this the histories of Europe and Asia will afford abundant +instances. + +In considering the condition of the lower classes of society, we +must consider only the real exchangeable value of labour; that is, +its power of commanding the necessaries, conveniences, and luxuries +of life. + +I stated in the Observations, and more at large in the Inquiry into +rents,(11*) that under the same demand for labour, and the same +consequent power of purchasing the means of subsistence, a high +money price of corn would give the labourer a very great advantage +in the purchase of the conveniences and luxuries of life. The effect +of this high money price would not, of course, be so marked among +the very poorest of the society, and those who had the largest +families; because so very great a part of their earnings must be +employed in absolute necessaries. But to all those above the very +poorest, the advantage of wages resulting from a price of eighty +shillings a quarter for wheat, compared with fifty or sixty, would +in the purchase of tea, sugar, cotton, linens, soap, candles, and +many other articles, be such as to make their condition decidedly +superior. + +Nothing could counterbalance this, but a much greater demand for +labour; and such an increased demand, in consequence of the opening +of our ports, is at best problematical. The check to cultivation has +been so sudden and decisive, as already to throw a great number of +agricultural labourers out of employment;(12*) and in Ireland this +effect has taken place to such a degree, as to threaten the most +distressing, and even alarming, consequences. The farmers, in some +districts, have entirely lost the little capital they possessed; +and, unable to continue in their farms, have deserted them, and left +their labourers without the means of employment. In a country, the +peculiar defects of which were already a deficiency of capital, and +a redundancy of population, such a check to the means of employing +labour must be attended with no common distress. In Ireland, it is +quite certain, that there are no mercantile capitals ready to take +up those persons who are thus thrown out of work, and even in Great +Britain the transfer will be slow and difficult. + +Our commerce and manufactures, therefore, must increase very +considerably before they can restore the demand for labour already +lost; for the and a moderate increase beyond this will scarcely make +up disadvantage of a low money price of wages. + +These wages will finally be determined by the usual money price of +corn, and the state of the demand for labour. + +There is a difference between what may be called the usual price of +corn and the average price, which has not been sufficiently attended +to. Let us suppose the common price of corn, for four years out of +five, to be about L2 a quarter, and during the fifth year to be L6. +The average price of the five years will then be L2 16s.; but the +usual price will still be about L2, and it is by this price, and not +by the price of a year of scarcity, or even the average including +it, that wages are generally regulated. + +If the ports were open, the usual price of corn would certainly +fall, and probably the average price; but from at has before been +said of the existing laws of France, and of the practice among the +Baltic nations of raising the tax on their exported corn in +proportion to the demand for it, there is every reason to believe, +that the fluctuations of price would be much greater. Such would, at +least, be my conclusion from theory; and, I think, it has been +confirmed by the experience of the last hundred years. During this +time, the period of our greatest importations, and of our greatest +dependence upon foreign corn, was from 1792 to 1805 inclusive; and +certainly in no fourteen years of the whole hundred were the +fluctuations of price so great. In 1792 the price was 42s. a +quarter; in 1796, 77s.; in 1801, 118s. a quarter; and, in 1803, 56s. +Between the year 1792 and 1801 the rise was almost a triple, and in +the short period from 1798 to 1803, it rose from 50s. to 118s. and +fell again to 56s.(13*) + +I would not insist upon this existence as absolutely conclusive, on +account of the mixture of accident in all such appeals to facts; but +it certainly tends to confirm the probability of those great +fluctuations which, according to all general principles, I should +expect from the temper and customs of nations, with regard to the +egress of corn, when it is scarce; and particularly from the +existing laws of that country, which, in all common years, will +furnish us with a large proportion of our supplies. + +To these causes of temporary fluctuations, during peace, should be +added the more durable as well as temporary, fluctuations occasioned +by war. Without reference to the danger of excessive scarcity from +another combination against us, if we are merely driven back at +certain distant intervals upon our own resources, the experience of +the present times will teach us not to estimate lightly the +convulsion which attends the return, and the evils of such +alternations of price. + +In the Observations, I mentioned some causes of fluctuations which +would attend the system of restrictions; but they are in my opinion +inconsiderable, compared with those which have been just referred +to. + +On the labouring classes, therefore, the effects of opening our +ports for the free importation of foreign corn, will be greatly to +lower their wages, and to subject them to much greater fluctuations +of price. And, in this state of things, it will require a much +greater increase in the demand for labour, than there is in any +rational ground for expecting, to compensate to the labourer the +advantages which he loses in the high money wages of labour, and the +steadier and less fluctuating price of corn. + +2. Of the next most important class of society, those who live upon +the profits of stock, one half probably are farmers, or immediately +connected with farmers; and of the property of the other half, not +above one fourth is engaged in foreign trade. + +Of the farmers it is needless to say anything. It cannot be doubted +that they will suffer severely from the opening of the ports. Not +that the profits of farming will not recover themselves, after a +certain period, and be as great, or perhaps greater, than they were +before; but this cannot take place till after a great loss of +agricultural capital, or the removal of it into the channels of +commerce and manufactures. + +Of the commercial and manufacturing part of the society, only those +who are directly engaged in foreign trade, will feel the benefit of +the importing system. It is of course to be expected, that the +foreign trade of the nation will increase considerably. If it do +not, indeed, we shall have experienced a very severe loss, without +anything like a compensation for it. And if this increase merely +equals the loss of produce sustained by agriculture, the quantity of +other produce remaining the same, it is quite clear that the country +cannot possibly gain by the exchange, at whatever price it may buy +or sell. Wealth does not consist in the dearness or cheapness of the +usual measure of value, but in the quantity of produce; and to +increase effectively this quantity of produce, after the severe +check sustained by agriculture, it is necessary that commerce should +make a very powerful start. + +In the actual state of Europe and the prevailing jealousy of our +manufactures, such a start seems quite doubtful; and it is by no +means impossible that we shall be obliged to pay for our foreign +corn, by importing less of other commodities, as well as by +exporting more of our manufactures. + +It may be said, perhaps, that a fall in the price of our corn and +labour, affords the only chance to our manufacturers of retaining +possession of the foreign markets; and that though the produce of +the country may not be increased by the fall in the price of corn, +such a fall is necessary to prevent a positive diminution of it. +There is some weight undoubtedly in this argument. But if we look at +the probable effects of returning peace to Europe, it is impossible +to suppose that, even with a considerable diminution in the price of +labour, we should not lose some markets on the continent, for those +manufactures in which we have no peculiar advantage; while we have +every reason to believe that in others, where our colonies, our +navigation, our long credits, our coals, and our mines come in +question, as well as our skill and capital, we shall retain our +trade in spite of high wages. Under these circumstances, it seems +peculiarly advisable to maintain unimpaired, if possible, the home +market, and not to lose the demand occasioned by so much of the +rents of land, and of the profits and capital of farmers, as must +necessarily be destroyed by the check to our home produce. + +But in whatever way the country may be affected by the change, we +must suppose that those who are immediately engaged in foreign trade +will benefit by it. As those, however, form but a very small portion +of the class of persons living on the profits of stock, in point of +number, and not probably above a seventh or eighth in point of +property, their interests cannot be allowed to weigh against the +interests of so very large a majority. + +With regard to this great majority, it is impossible that they +should not feel very widely and severely the diminution of their +nominal capital by the fall of prices. We know the magic effect upon +industry of a rise of prices. It has been noticed by Hume, and +witnessed by every person who has attended to subjects of this kind. +And the effects of a fall are proportionately depressing. Even the +foreign trade will not escape its influence, though here it may be +counterbalanced by a real increase of demand. But, in the internal +trade, not only will the full effect of this deadening weight be +experienced, but there is reason to fear that it may be accompanied +with an actual diminution of home demand. There may be the same or +even a greater quantity of corn consumed in the country, but a +smaller quantity of manufactures and colonial produce; and our +foreign corn may be purchased in part by commodities which were +before consumed at home. In this case, the whole of the internal +trade must severely suffer, and the wealth and enjoyments of the +country be decidedly diminished. The quantity of a country's exports +is a very uncertain criterion of its wealth. The quantity of produce +permanently consumed at home is, perhaps, the most certain criterion +of wealth to which we can refer. + +Already, in all the country towns, this diminution of demand has +been felt in a very great degree; and the surrounding farmers, who +chiefly support them, are quite unable to make their accustomed +purchases. If the home produce of grain be considerably diminished +by the opening of our ports, of which there can be no doubt, these +effects in the agricultural countries must be permanent, though not +to the same extent as at present. And even if the manufacturing +towns should ultimately increase, in proportion to the losses of the +country, of which there is great reason to doubt, the transfer of +wealth and population will be slow, painful, and unfavourable to +happiness. + +3. Of the class of landholders, it may be truly said, that though +they do not so actively contribute to the production of wealth, as +either of the classes just noticed, there is no class in society +whose interests are more nearly and intimately connected with the +prosperity of the state. + +Some persons have been of opinion, and Adam Smith himself among +others, that a rise or fall of the price of corn does not really +affect the interests of the landholders; but both theory and +experience prove the contrary; and shew, that, under all common +circumstances, a fall of price must be attended with a diminution of +produce, and that a diminution of produce will naturally be attended +with a diminution of rent.(14*) + +Of the effect, therefore, of opening the ports, in diminishing both +the real and nominal rents of the landlords, there can be no doubt; +and we must not imagine that the interest of a body of men, so +circumstanced as the landlords, can materially suffer without +affecting the interests of the state. + +It has been justly observed by Adam Smith, that 'no equal quantity +of productive labour employed in manufactures can ever occasion so +great a reproduction as in agriculture.' If we suppose the rents of +land taken throughout the kingdom to be one fourth of the gross +produce, it is evident, that to purchase the same value of raw +produce by means of manufactures, would require one third more +capital. Every five thousand pounds laid out on the land, not only +repays the usual profits of stock, but generates an additional +value, which goes to the landlord. And this additional value is not +a mere benefit to a particular individual, or set of individuals, +but affords the most steady home demand for the manufactures of the +country, the most effective fund for its financial support, and the +largest disposable force for its army and navy. It is true, that the +last additions to the agricultural produce of an improving country +are not attended with a large proportion of rent;(15*) and it is +precisely this circumstance that may make it answer to a rich +country to import some of its corn, if it can be secure of obtaining +an equable supply. But in all cases the importation of foreign corn +must fail to answer nationally, if it is not so much cheaper than +the corn that can be grown at home, as to equal both the profits and +the rent of the grain which it displaces. + +If two capitals of ten thousand pounds each, be employed, one in +manufactures, and the other in the improvement of the land, with the +usual profits, and withdrawn in twenty years, the one employed in +manufactures will leave nothing behind it, while the one employed on +the land will probably leave a rent of no inconsiderable value. + +These considerations, which are not often attended to, if they do +not affect the ordinary question of a free trade in corn, must at +least be allowed to have weight, when the policy of such a trade is, +from peculiarity of situation and circumstances, rendered doubtful. + +4. We now come to a class of society, who will unquestionably be +benefited by the opening of our ports. These are the stockholders, +and those who live upon fixed salaries.(16*) They are not only, +however, small in number, compared with those who will be affected +in a different manner; but their interests are not so closely +interwoven with the welfare of the state, as the classes already +considered, particularly the labouring classes, and the landlords. + +In the Observations, I remarked, that it was 'an error of the most +serious magnitude to suppose that any natural or artificial causes, +which should raise or lower the values of corn or silver, might be +considered as matters of indifference; and that, practically, no +material change could take place in the value of either, without +producing both temporary and lasting effects, which have a most +powerful influence on the distribution of property.' + +In fact, it is perfectly impossible to suppose that, in any change +in the measure of value, which ever did, or ever can take place +practically, all articles, both foreign and domestic, and all +incomes, from whatever source derived, should arrange themselves +precisely in the same relative proportions as before. And if they do +not, it is quite obvious, that such a change may occasion the most +marked differences in the command possessed by individuals and +classes of individuals over the produce and wealth of the country. +Sometimes the changes of this kind that actually take place, are +favourable to the industrious classes of society, and sometimes +unfavourable. + +It can scarcely be doubted, that one of the main causes, which has +enabled us hitherto to support, with almost undiminished resources, +the prodigious weight of debt which has been accumulated during the +last twenty years, is the continued depreciation of the measure in +which it has been estimated, and the great stimulus to industry, and +power of accumulation, which have been given to the industrious +classes of society by the progressive rise of prices. As far as this +was occasioned by excessive issues of paper, the stockholder was +unjustly treated, and the industrious classes of society benefited +unfairly at his expense. But, on the other hand, if the price of +corn were now to fall to 50 shillings a quarter, and labour and +other commodities nearly in proportion, there can be no doubt that +the stockholder would be benefited unfairly at the expense of the +industrious classes of society, and consequently at the expense of +the wealth and prosperity of the whole country. + +During the twenty years, beginning with 1794 and ending with 1813, +the average price of British corn per quarter was about eighty-three +shillings; during the ten years ending with 1813, ninety-two +shillings; and during the last five years of the twenty, one hundred +and eight shillings. In the course of these twenty years, the +government borrowed near five hundred millions of real capital, for +which on a rough average, exclusive of the sinking fund, it engaged +to pay about five per cent. But if corn should fall to fifty +shillings a quarter, and other commodities in proportion, instead of +an interest of about five per cent. the government would really pay +an interest of seven, eight, nine, and for the last two hundred +millions, ten per cent. + +To this extraordinary generosity towards the stockholders, I should +be disposed to make no kind of objection, if it were not necessary +to consider by whom it is to be paid; and a moment's reflection will +shew us, that it can only be paid by the industrious classes of +society and the landlords, that is, by all those whose nominal +incomes will vary with the variations in the measure of value. The +nominal revenues of this part of the society, compared with the +average of the last five years, will be diminished one half; and out +of this nominally reduced income, they will have to pay the same +nominal amount of taxation. + +The interest and charges of the national debt, including the sinking +fund, are now little short of L40 millions a year; and these L40 +millions, if we completely succeed in the reduction of the price of +corn and labour, are to be paid in future from a revenue of about +half the nominal value of the national income in 1813. + +If we consider, with what an increased weight the taxes on tea, +sugar, malt, leather, soap, candles, etc., etc. would in this case +bear on the labouring classes of society, and what proportion of +their incomes all the active, industrious middle orders of the +state, as well as the higher orders, must pay in assessed taxes, and +the various articles of the customs and excise, the pressure will +appear to be absolutely intolerable. Nor would even the ad valorem +taxes afford any real relief. The annual fourty millions, must at +all events be paid; and if some taxes fail, others must be imposed +that will be more productive. + +These are considerations sufficient to alarm even the stockholders +themselves, indeed, if the measure of value were really to fall, as +we have supposed, there is great reason to fear that the country +would be absolutely unable to continue the payment of the present +interest of the national debt. + +I certainly do not think, that by opening our ports to the freest +admission of foreign corn, we shall lower the price to fifty +shillings a quarter. I have already given my reasons for believing +that the fluctuations which in the present state of Europe, a system +of importation would bring with it, would be often producing dear +years, and throwing us back again upon our internal resources. But +still there is no doubt whatever, that a free influx of foreign +grain would in all commonly favourable seasons very much lower its +price. + +Let us suppose it lowered to sixty shillings a quarter, which for +periods of three or four years together is not improbable. The +difference between a measure of value at 60 compared with 80 (the +price at which it is proposed to fix the importation), is 33 1/3 per +cent. This percentage upon 40 millions amounts to a very formidable +sum. But let us suppose that corn does not effectually regulate the +prices of other commodities; and, making allowances on this account, +let us take only 25, or even 20 per cent. Twenty per cent. upon 40 +millions amounts at once to 8 millions--a sum which ought to go a +considerable way towards a peace establishment; but which, in the +present case, must go to pay the additional interest of the national +debt, occasioned by the change in the measure of value. And even if +the price of corn be kept up by restrictions to 80 shillings a +quarter, it is certain that the whole of the loans made during the +war just terminated, will on an average, be paid at an interest very +much higher than they were contracted for; which increased interest +can, of course, only be furnished by the industrious classes of +society. + +I own it appears to me that the necessary effect of a change in the +measure of value on the weight of a large national debt is alone +sufficient to make the question fundamentally different from that of +a simple question about a free or restricted trade; and, that to +consider it merely in this light, and to draw our conclusions +accordingly, is to expect the same results from premises which have +essentially changed their nature. From this review of the manner in +which the different classes of society will be affected by the +opening of our ports, I think it appears clearly, that very much the +largest mass of the people, and particularly of the industrious +orders of the state, will be more injured than benefited by the +measure. + +I have now stated the grounds on which it appears to me to be wise +and politic, in the actual circumstances of the country, to restrain +the free importation of foreign corn. + +To put some stop to the progressive loss of agricultural capital, +which is now taking place, and which it will be by no means easy to +recover, it might be advisable to pass a temporary act of +restriction, whatever may be the intention of the legislature in +future. But, certainly it is much to be wished that as soon as +possible, consistently with due deliberation, the permanent policy +intended to be adopted with regard to the trade in corn should be +finally settled. Already, in the course of little more than a +century, three distinct changes in this policy have taken place. The +act of William, which gave the bounty, combined with the prohibitory +act of Charles II was founded obviously and strikingly upon the +principle of encouraging exportation and discouraging importation; +the spirit of the regulations adopted in 1773, and acted upon some +time before, was nearly the reverse, and encouraged importation and +discouraged exportation. Subsequently, as if alarmed at the +dependence of the country upon foreign corn, and the fluctuations of +price which it had occasioned, the legislature in a feeble act of +1791, and rather a more effective one in 1804, returned again to the +policy of restrictions. And if the act of 1804 be left now +unaltered, it may be fairly said that a fourth change has taken +place; as it is quite certain that, to proceed consistently upon a +restrictive system, fresh regulations become absolutely necessary to +keep pace with the progressive fall in the value of currency. + +Such changes in the spirit of our legislative enactments are much to +be deprecated; and with a view to a greater degree of steadiness in +future, it is quite necessary that we should be so fully prepared +for the consequences which belong to each system, as not to have our +determinations shaken by them, when they occur. + +If, upon mature deliberation, we determine to open our ports to the +free admission of foreign grain, we must not be disturbed at the +depressed state, and diminished produce of our home cultivation; we +must not be disturbed at our becoming more and more dependent upon +other nations for the main support of our population; we must not be +disturbed at the greatly increased pressure of the national debt +upon the national industry; and we must not be disturbed at the +fluctuations of price, occasioned by the very variable supplies, +which we shall necessarily receive from France, in the actual state +of her laws, or by the difficulty and expense of procuring large, +and sudden imports from the Baltic, when our wants are pressing. +These consequences may all be distinctly foreseen. Upon all general +principles, they belong to the opening of our ports, in the actual +state and relations of this country to the other countries of +Europe; and though they may be counterbalanced or more than +counterbalanced, by other advantages, they cannot, in the nature of +things, be avoided. + +On the other hand, if, on mature deliberation, we determine steadily +to pursue a system of restrictions with regard to the trade in corn, +we must not be disturbed at a progressive rise in the price of +grain; we must not be disturbed at the necessity of altering, at +certain intervals, our restrictive laws according to the state of +the currency, and the value of the precious metals; we must not be +disturbed at the progressive diminution of fixed incomes; and we +must not be disturbed at the occasional loss or diminution of a +continental market for some of our least peculiar manufactures, +owing to the high price of our labour.(17*) All these disadvantages +may be distinctly foreseen. According to all general principles they +strictly belong to the system adopted; and, though they may be +counterbalanced, and more than counterbalanced, by other greater +advantages, they cannot, in the nature of things, be avoided, if we +continue to increase in wealth and population. + +Those who promise low prices upon the restrictive system, take an +erroneous view of the causes which determine the prices of raw +produce, and draw an incorrect inference from the experience of the +first half of the last century. As I have stated in another +place,(18*) a nation which very greatly gets the start of its +neighbours in riches, without any peculiar natural facilities for +growing corn, must necessarily submit to one of these +alternatives--either a very high comparative price of grain, or a +very great dependence upon other countries for it. + +With regard to the specific mode of regulating the importation of +corn, if the restrictive system be adopted, I am not sufficiently +acquainted with the details of the subject to be able to speak with +confidence. It seems to be generally agreed, that, in the actual +state of things, a price of about eighty shillings a quarter(19*) +would prevent our cultivation from falling back, and perhaps allow +it to be progressive. But, in future, we should endeavour, if +possible, to avoid all discussions about the necessity of protecting +the British farmer, and securing to him a fair living profit. Such +language may perhaps be allowable in a crisis like the present. But +certainly the legislature has nothing to do with securing to any +classes of its subjects a particular rate of profits in their +different trades. This is not the province of a government; and it +is unfortunate that any language should be used which may convey +such an impression, and make people believe that their rulers ought +to listen to the accounts of their gains and losses. + +But a government may certainly see sufficient reasons for wishing to +secure an independent supply of grain. This is a definite, and may +be a desirable, object, of the same nature as the Navigation Act; +and it is much to be wished, that this object, and not the interests +of farmers and landlords, should be the ostensible, as well as the +real, end which we have in view, in all our inquiries and +proceedings relating to the trade in corn. + +I firmly believe that, in the actual state of Europe, and under the +actual circumstances of our present situation, it is our wisest +policy to grow our own average supply of corn; and, in so doing, I +feel persuaded that the country has ample resources for a great and +continued increase of population, of power, of wealth, and of +happiness. + + + + +NOTES: + +1. Some of my friends were of different opinions as to the side, +towards which my arguments most inclined. This I consider as a +tolerably fair proof of impartiality. + +2. Mercantile losses are always comparatively partial; but the +present losses, occasioned by the unusual combination of low prices, +and scanty produce, must inflict a severe blow upon the whole mass +of cultivators. There never, perhaps, was known a year more +injurious to the interests of agriculture. + +3. At the same time, I certainly now very much wish that some +regulation had been adopted last year. It would have saved the +nation a great loss of agricultural capital, which it will take some +time to recover. But it was impossible to foresee such a year as the +present--such a combination, as a very bad harvest, and very low +prices. + +4. I have very little doubt that the value of paper in this country +has already risen, norwithstanding the increased issues of the Bank. +These increased issues I attribute chiefly to the great failures +which have taken place among country banks, and the very great +purchases which have been made for the continental markets, and, +under these circumstances, increased issues might take place, +accompanied even by a rise of value. But the currency has not yet +recovered itself. The real exchange, during the last year, must have +been greatly in our favour, although the nominal exchange is +considerably against us. This shews, incontrovertibly, that our +currency is still depreciated, in reference to the bullion +currencies of the continent. A part, however, of this depreciation +may still be owing to the value of bullion in Europe not having yet +fallen to its former level. + +5. Calculated at twenty-four livres the pound sterling. + +6. It has been supposed by some, that this law cannot, and will not +be executed: but I own I see no grounds for such an opinion. It is +difficult to execute prohibitions against the exportation of corn, +when it is in great plenty, but not when it is scarce. For ten years +before 1757, we had in this country, regularly exported on an +average, above 400,000 quarters of wheat, and in that year there was +at once an excess of importation. With regard to the alleged +impotence of governments in this respect, it appears to me that +facts shew their power rather than their weakness. To be convinced +of this, it is only necessary to look at the diminished importations +from America during the war, and particularly from the Baltic after +Bonaparte's decrees. The imports from France and the Baltic in 1810, +were by special licences, granted for purposes of revenue. Such +licences shewed strength rather than weakness; and might have been +refused, if a greater object than revenue had at that time presented +itself. + +7. The average is 16 francs, 21 centimes, the Hectolitre. The +Hectolitre is about 1-20th less than 3 Winchester bushels, which +makes the English quarter come to about 38 shillings. + +8. It appears from the evidence, that the corn from the Baltic is +often very heavily taxed, and that this tax is generally raised in +proportion to our necessities. In a scarce year in this country we +could never get any considerable quantity of corn from the Baltic, +without paying an enormous price for it. + +9. By the real growing price of corn I mean the real quantity of +labour and capital which has been employed to procure the last +additions which have been made to the national produce. In every +rich and improving country there is a natural and strong tendency to +a constantly increasing price of raw produce, owing to the necessity +of employing, progressively, land of an inferior quality. But this +tendency may be partially counteracted by great improvements in +cultivation, and economy of labour. See this subject treated in An +inquiry into the nature and progress of rent, just published. + +10. Sir John Sinclair's Account of the Husbandry of Scotland: and +the General Report of Scotland. + +11. "Inquiry into the Nature and Progress of Rent, and the +Principles by which it is regulated." + +12. I was not prepared to expect (as I intimated in the +Observations) so sudden a fall in the price of labour as has already +taken place. This fall has been occasioned, not so much by the low +price of corn, as by the sudden stagnation of agricultural work, +occasioned by a more sudden check to cultivation than I foresaw. + +13. I am strongly disposed to believe, that it is owning to the +unwillingness of governments to allow the free egress of their corn, +when it is scarce, that nations are practically so little dependent +upon each other for corn, as they are found to be. According to all +general principles they ought to be more dependent. But the great +fluctuations in the price of corn, occasioned by this unwillingness, +tend to throw each country back again upon its internal resources. +This was remarkably the case with us in 1800 and 1801, when the very +high price, which we paid for foreign corn, gave a prodigious +stimulus to our domestic agriculture. A large territorial country, +that imports foreign corn, is exposed not infrequently to the +fluctuations which belong to this kind of variable dependence, +without obtaining the cheapness that ought to accompany a trade in +corn really free. + +14. See this subject treated in An Inquiry into the Nature and +Progress of Rents. + +15. Inquiry into the Nature and Progress of Rent. + +16. It is to this class of persons that I consider myself as chiefly +belonging. Much the greatest part of my income is derived from a +fixed salary and the interest of money in the funds. + +17. It often happens that the high prices of a particular country +may diminish the quantity of its exports without diminishing the +value of their amount abroad; in which case its foreign trade is +peculiarly advantageous, as it purchases the same amount of foreign +commodities at a much less expense of labour and capital. + +18. Inquiry into the Nature and Progress of Rent. + +19. This price seems to be pretty fairly consistent with the idea of +getting rid of that part of our high prices which belongs to +excessive issues of paper, and retaining only that part which +belongs to great wealth, combined with a system of restrictions. + + + + + + + + + +End of the Project Gutenberg EBook of The Grounds of an Opinion on the +Policy of Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws", by Thomas Malthus + +*** END OF THIS PROJECT GUTENBERG EBOOK IMPORTATION OF FOREIGN CORN *** + +***** This file should be named 4335.txt or 4335.zip ***** +This and all associated files of various formats will be found in: + https://www.gutenberg.org/4/3/3/4335/ + +Produced by Charles Aldarondo. 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Johnson +and Co., St. Paul's Church Yard, 1815. + + + + + + +Grounds, &c. + + + + + +The professed object of the Observations on the Corn Laws, which I +published in the spring of 1814, was to state with the strictest +impartiality the advantages and disadvantages which, in the actual +circumstances of our present situation, were likely to attend the +measures under consideration, respecting the trade in corn. + +A fair review of both sides of the question, without any attempt to +conceal the peculiar evils, whether temporary or permanent, which +might belong to each, appeared to me of use, not only to assist in +forming an enlightened decision on the subject, but particularly to +prepare the public for the specific consequences which were to be +expected from that decision, on whatever side it might be made. Such +a preparation, from some quarter or other, seemed to be necessary, +to prevent those just discontents which would naturally have arisen, +if the measure adopted had been attended with results very different +from those which had been promised by its advocates, or contemplated +by the legislature. + +With this object in view, it was neither necessary, nor desirable, +that I should myself express a decided opinion on the subject. It +would hardly, indeed, have been consistent with that character of +impartiality, which I wished to give to my statements, and in which +I have reason to believe I in some degree succeeded.(1*) + +These previous statements, however, having been given, and having, I +hope, shewn that the decision, whenever it is made, must be a +compromise of contending advantages and disadvantages, I have no +objection now to state (without the least reserve), and I can truly +say, wit the most complete freedom from all interested motives, the +grounds of a deliberate, yet decided, opinion in favour of some +restrictions on the importation of foreign corn. + +This opinion has been formed, as I wished the readers of the +Observations to form their opinions, by looking fairly at the +difficulties on both sides of the question; and without vainly +expecting to attain unmixed results, determining on which side there +is the greatest balance of good with the least alloy of evil. The +grounds on which the opinion so formed rests, are partly those which +were stated in the Observations, and partly, and indeed mainly, some +facts which have occurred during the last year, and which have +given, as I think, a decisive weight to the side of restrictions. + +These additional facts are-- + +1st, The evidence, which has been laid before Parliament, relating +to the effects of the present prices of corn, together with the +experience of the present year. + +2dly, The improved state of our exchanges, and the fall in the price +of bullion. And + +3dly, and mainly, the actual laws respecting the exportation of corn +lately passed in France. + +In the Observations on the corn laws, I endeavoured to shew that, +according to the general principles of supply and demand, a +considerable fall in the price of corn could not take place, without +throwing much poor lad out of cultivation, and effectually +preventing, for a considerable time, all further improvements in +agriculture, which have for their object an increase of produce. + +The general principles, on which I calculated upon these +consequences, have been fully confirmed by the evidence brought +before the two houses of Parliament; and the effects of a +considerable fall in the price of corn, and of the expected +continuance of low prices, have shewn themselves in a very severe +shock to the cultivation of the country and a great loss of +agricultural capital. + +Whatever may be said of the peculiar interests and natural +partialities of those who were called upon to give evidence upon +this occasion, it is impossible not to be convinced, by the whole +body of it taken together, that, during the last twenty years, and +particularly during the last seven, there has been a great increase +of capital laid out upon the land, and a great consequent extension +of cultivation and improvement; that the system of spirited +improvement and high farming, as it is technically called, has been +principally encouraged by the progressive rise of prices owing in a +considerable degree, to the difficulties thrown in the way of +importation of foreign corn by the war; that the rapid accumulation +of capital on the land, which it had occasioned, had so increased +our home growth of corn, that, notwithstanding a great increase of +population, we had become much less dependent upon foreign supplies +for our support; and that the land was still deficient in capital, +and would admit of the employment of such an addition to its present +amount, as would be competent to the full supply of a greatly +increased population: but that the fall of prices, which had lately +taken place, and the alarm of a still further fall, from continued +importation, had not only checked all progress of improvement, but +had already occasioned a considerable loss of agricultural advances; +and that a continuation of low prices would, in spite of a +diminution of rents, unquestionably destroy a great mass of farming +capital all over the country, and essentially diminish its +cultivation and produce. + +It has been sometimes said, that the losses at present sustained by +farmers are merely the natural and necessary consequences of +overtrading, and that they must bear them as all other merchants do, +who have entered into unsuccessful speculations. But surely the +question is not, or at least ought not to be, about the losses and +profits of farmers, and the present condition of landholders +compared with the past. It may be necessary, perhaps, to make +inquiries of this kind, with a view to ulterior objects; but the +real question respects the great loss of national wealth, attributed +to a change in the spirit of our legislative enactments relating to +the admission of foreign corn. + +We have certainly no right to accuse our farmers of rash speculation +for employing so large a capital in agriculture. The peace, it must +be allowed, was most unexpected; and if the war had continued, the +actual quantity of capital applied to the land, might have been as +necessary to save the country from extreme want in future, as it +obviously was in 1812, when, with the price of corn at above six +guineas a quarter, we could only import a little more than 100,000 +quarters. If, from the very great extension of cultivation, during +the four or five preceding years, we had not obtained a very great +increase of average produce, the distresses of that year would have +assumed a most serious aspect. + +There is certainly no one cause which can affect mercantile +concerns, at all comparable in the extent of its effects, to the +cause now operating upon agricultural capital. Individual losses +must have the same distressing consequences in both cases, and they +are often more complete, and the fall is greater, in the shocks of +commerce. But I doubt, whether in the most extensive mercantile +distress that ever took in this country, there was ever one fourth +of the property, or one tenth of the number of individuals +concerned, when compared with the effects of the present rapid fall +of raw produce, combined with the very scanty crop of last year.(2*) + +Individual losses of course become national, according as they +affect a greater mass of the national capital, and a greater number +of individuals; and I think it must be allowed further, that no +loss, in proportion to its amount, affects the interest of the +nation so deeply, and vitally, and is so difficult to recover, as +the loss of agricultural capital and produce. + +If it be the intention of the legislature fairly to look at the +evils, as well as the good, which belongs to both sides of the +question, it must be allowed, that the evidence laid before the two +houses of Parliament, and still more particularly the experience of +the last year, shew, that the immediate evils which are capable of +being remedied by a system of restrictions, are of no inconsiderable +magnitude. + +2. In the Observations on the corn laws, I gave, as a reason for +some delay in coming to a final regulation respecting the price at +which foreign corn might be imported, the very uncertain state of +the currency. I observed, that three different importation prices +would be necessary, according as our currency should either rise to +the then price of bullion, should continue at the same nominal +value, or should take an intermediate position, founded on a fall in +the value of bullion, owing to the discontinuance of an +extraordinary demand for it, and a rise in the value of paper, owing +to the prospect of a return to payments in specie. In the course of +this last year, the state of our exchanges, and the fall in the +price of bullion, shew pretty clearly, that the intermediate +alteration which, I then contemplated, greater than in the case +first mentioned, and less than in the second, is the one which might +be adopted with a fair prospect of permanence; and that we should +not now proceed under the same uncertainty respecting the currency, +which we should have done, if we had adopted a final regulation in +the early part of last year.(3*) This intermediate alteration, +however, supposes a rise in the value of paper on a return to cash +payments, and some general fall of prices quite unconnected with any +regulations respecting the corn trade.(4*) + +But, if some fall of prices must take place from this cause, and if +such a fall can never take place without a considerable check to +industry, and discouragement to the accumulation of capital, it +certainly does not seem a well-chosen time for the legislature to +occasion another fall still greater, by departing at once from a +system of restrictions which it had pursued with steadiness during +the greatest part of the last century and, after having given up for +a short period, had adopted again as its final policy in its two +last enactments respecting the trade in corn. Even if it be +intended. Finally, to throw open our ports, it might be wise to pass +some temporary regulations, in order to prevent the very great shock +which must take place, if the two causes here noticed, of the +depreciation of commodities, be allowed to produce their full effect +by contemporaneous action. + +3. I stated, in the Observations on the corn laws, that the +cheapness and steadiness in the price of corn, which were promised +by the advocates of restrictions, were not attainable by the +measures they proposed; that it was really impossible for us to grow +at home a sufficiency for our own consumption, without keeping up +the price of corn considerably above the average of the rest of +Europe; and that, while this was the case, as we could never export +to any advantage, we should always be liable to the variations of +price, occasioned by the glut of a superabundant harvest; in short, +that it must be allowed that a free trade in corn would, in all +ordinary cases, not only secure a cheaper, but a more steady, supply +of grain. + +In expressing this distinct opinion on the effects of a free trade +in corn, I certainly meant to refer to a trade really free--that +is, a trade by which a nation would be entitled to its share of the +produce of the commercial world, according to its means of +purchasing, whether that produce were plentiful or scanty. In this +sense I adhere strictly to the opinion I then gave; but, since that +period, an event has occurred which has shewn, in the clearest +manner, that it is entirely out of our power, even in time of peace, +to obtain a free trade in corn, or an approximation towards it, +whatever may be our wishes on the subject. + +It has, perhaps, not been sufficiently attended to in general, when +the advantages of a free trade in corn have been discussed, that the +jealousies and fears of nations, respecting their means of +subsistence, will very rarely allow of a free egress of corn, when +it is in any degree scarce. Our own statutes, till the very last +year, prove these fears with regard to ourselves; and regulations of +the same tendency occasionally come in aid of popular clamour in +almost all countries of Europe. But the laws respecting the +exportation of corn, which have been passed in France during the +last year, have brought this subject home to us in the most striking +and impressive manner. Our nearest neighbour, possessed of the +largest and finest corn country in Europe, and who, owing to a more +favourable climate and soil, a more stationary and comparatively +less crowded population, and a lighter weight of taxation, can grow +corn at less than half our prices, has enacted, that the exportation +of corn shall be free till the price rises to about forty nine +shillings a quarter,(5*) and that then it shall be entirely +cease.(6*) + +From the vicinity of France, and the cheapness of its corn in all +years of common abundance, it is scarcely possible that our main +imports should not come from that quarter as long as our ports are +open to receive them. In this first year of open trade, our imports +have been such, as to shew, that though the corn of the Baltic +cannot seriously depress our prices in an unfavourable season at +home, the corn of France may make it fall below a growing price, +under the pressure of one of the worst crops that has been known for +a long series of years. + +I have at present before me an extract from a Rouen paper, +containing the prices of corn in fourteen different markets for the +first week in October, the average of which appears to be about +thirty eight shillings a quarter;(7*) and this was after +disturbances had taken place both at Havre and Dieppe, on account of +the quantity exported, and the rise of prices which it had +occasioned. + +It may be said, perhaps, that the last harvest of France has been a +very favourable one, and affords no just criterion of its general +prices. But, from all that I hear, prices have often been as low +during the last ten years. And, an average not exceeding forty +shillings a quarter may, I think, be conclusively inferred from the +price at which exportation is by law to cease. + +At a time when, according to Adam Smith, the growing price in this +country was only twenty eight shillings a quarter, and the average +price, including years of scarcity, only thirty three shillings, +exportation was not prohibited till the price rose to forty eight +shillings. It was the intention of the English government, at that +time, to encourage agriculture by giving vent to its produce. We may +presume that the same motive influenced the government of France in +the late act respecting exportation. And it is fair therefore to +conclude, that the price of wheat, in common years, is considerably +less than the price at which exportation is to cease. + +With these prices so near us, and with the consequent power of +supplying ourselves with great comparative rapidity, which in the +corn trade is a point of the greatest importance, there can be no +doubt that, if our ports were open, our principal supplies of grain +would come from France; and that, in all years of common plenty in +that country, we should import more largely from it than from the +Baltic. But from this quarter, which would then become our main and +most habitual source of supply, all assistance would be at once cut +off, in every season of only moderate scarcity; and we should have +to look to other quarters, from which it is an established fact, +that large sudden supplies cannot be obtained, not only for our +usual imports, and the natural variations which belong to them, but +for those which had been suddenly cut off from France, and which our +habitually deficient growth had now rendered absolutely necessary. + +To open our ports, under these circumstances, is not to obtain a +free trade in corn; and, while I should say, without hesitation, +that a free trade in corn was calculated to produce steadier prices +than the system of restrictions with which it has been compared, I +should, with as little hesitation say, that such a trade in corn, as +has been described, would be subject to much more distressing and +cruel variations, than the most determined system of prohibitions. + +Such a species of commerce in grain shakes the foundations, and +alters entirely the data on which the general principles of free +trade are established. For what do these principles say? They say, +and say most justly, that if every nation were to devote itself +particularly to those kinds of industry and produce, to which its +soil, climate, situation, capital, and skill, were best suited; and +were then freely to exchange these products with each other, it +would be the most certain and efficacious mode, not only. of +advancing the wealth and prosperity of the whole body of the +commercial republic with the quickest pace, but of giving to each +individual nation of the body the full and perfect use of all its +resources. + +I am very far indeed from meaning to insinuate, that if we cannot +have the most perfect freedom of trade, we should have none; or that +a great nation must immediately alter its commercial policy, +whenever any of the countries with which it deals passes laws +inconsistent with the principles of freedom. But I protest most +entirely against the doctrine, that we are to pursue our general +principles without ever looking to see if they are applicable to the +case before us; and that in politics and political economy, we are +to go straight forward, as we certainly ought to do in morals, +without any reference to the conduct and proceedings of others. + +There is no person in the least acquainted with political economy, +but must be aware that the advantages resulting from the division of +labour, as applicable to nations as well as individuals, depend +solely and entirely on the power of exchanging subsequently the +products of labour. And no one can hesitate to allow, that it is +completely in the power of others to prevent such exchanges, and to +destroy entirely the advantages which would otherwise result from +the application of individual or national industry, to peculiar and +appropriate products. + +Let us suppose, for instance, that the inhabitants of the Lowlands +of Scotland were to say to the Highlanders, 'We will exchange our +corn for your cattle, whenever we have a superfluity; but if our +crops in any degree fail, you must not expect to have a single +grain': would not the question respecting the policy of the present +change, which is taking place in the Highlands, rest entirely upon +different grounds? Would it not be perfectly senseless in the +Highlanders to think only of those general principles which direct +them to employ the soil in the way that is best suited to it? If +supplies of corn could not be obtained with some degree of +steadiness and certainty from other quarters, would it not be +absolutely necessary for them to grow it themselves, however ill +adapted to it might be their soil and climate? + +The same may be said of all the pasture districts of Great Britain, +compared with the surrounding corn countries. If they could only +obtain the superfluities of their neighbours, and were entitled to +no share of the produce when it was scarce, they could not certainly +devote themselves with any degree of safety to their present +occupations. + +There is, on this account, a grand difference between the freedom of +the home trade in corn, and the freedom of the foreign trade. A +government of tolerable vigour can make the home trade in corn +really free. It can secure to the pasture districts, or the towns +that must be fed from a distance, their share of the general +produce, whether plentiful or scarce. It can set them quite at rest +about the power of exchanging the peculiar products of their own +labour for the other products which are necessary to them, and can +dispense, therefore, to all its subjects, the inestimable advantages +of an unrestricted intercourse. + +But it is not in the power of any single nation to secure the +freedom of the foreign trade in corn. To accomplish this, the +concurrence of many others is necessary; and this concurrence, the +fears and jealousies so universally prevalent about the means of +subsistence, almost invariably prevent. There is hardly a nation in +Europe which does not occasionally exercise the power of stopping +entirely, or heavily taxing, its exports of grain, if prohibitions +do not form part of its general code of laws. + +The question then before us is evidently a special, not a general +one. It is not a question between the advantages of a free trade, +and a system of restrictions; but between a specific system of +restrictions formed by ourselves for the purpose of rendering us, in +average years, nearly independent of foreign supplies, and the +specific system of restricted importations, which alone it is in our +power to obtain under the existing laws of France, and in the actual +state of the other countries of the continent.(8*) + +In looking, in the first place, at the resources of the country, +with a view to an independent supply for an increasing population; +and comparing subsequently the advantages of the two systems +abovementioned, without overlooking their disadvantages, I have +fully made up my mind as to the side on which the balance lies; and +am decidedly of opinion, that a system of restrictions so calculated +as to keep us, in average years, nearly independent of foreign +supplies of corn, will more effectually conduce to the wealth and +prosperity of the country, and of by far the greatest mass of the +inhabitants, than the opening of our ports for the free admission of +foreign corn, in the actual state of Europe. + +Of the resources of Great Britain and Ireland for the further growth +of corn, by the further application of capital to the land, the +evidence laid before parliament furnishes the most ample testimony. +But it is not necessary, for this purpose, to recur to evidence that +may be considered as partial. All the most intelligent works which +have been written on agricultural subjects of late years, agree in +the same statements; and they are confirmed beyond a possibility of +doubt, when we consider the extraordinary improvements, and +prodigious increase of produce that have taken place latterly in +some districts, which, in point of natural soil, are not superior to +others that are still yielding the most scanty and miserable crops. +Most of the light soils of the kingdom might, with adequate capital +and skill, be made to equal the improved parts of Norfolk; and the +vast tracts of clay lands that are yet in a degraded state almost +all over the kingdom, are susceptible of a degree of improvement, +which it is by no means easy to fix, but which certainly offers a +great prospective increase of produce. There is even a chance (but +on this I will not insist) of a diminution in the real price of +corn,(9*) owing to the extension of those great improvements, and +that great economy and good management of labour, of which we have +such intelligent accounts from Scotland.(10*) If these clay lands, +by draining, and the plentiful application of lime and other +manures, could be so far meliorated in quality as to admit of being +worked by two horses and a single man, instead of three or four +horses with a man and a boy, what a vast saving of labour and +expense would at once be effected, at the same time that the crops +would be prodigiously increased! And such an improvement may +rationally be expected, from what has really been accomplished in +particular districts. In short, if merely the best modes of +cultivation, now in use in some parts of Great Britain, were +generally extended, and the whole country was brought to a level, in +proportion to its natural advantages of soil and situation, by the +further accumulation and more equable distribution of capital and +skill; the quantity of additional produce would be immense, and +would afford the means of subsistence to a very great increase of +population. + +In some countries possessed of a small territory, and consisting +perhaps chiefly of one or two large cities, it never can be made a +question, whether or not they should freely import foreign corn. +They exist, in fact, by this importation; and being always, in point +of population, inconsiderable, they may, in general, rely upon a +pretty regular supply. But whether regular or not, they have no +choice. Nature has clearly told them, that if they increase in +wealth and power to any extent, it can only be by living upon the +raw produce of other countries. + +It is quite evident that the same alternative is not presented to +Great Britain and Ireland, and that the united empire has ample +means of increasing in wealth, population, and power, for a very +long course of years, without being habitually dependent upon +foreign supplies for the means of supporting its inhabitants. + +As we have clearly, therefore, our choice between two systems, under +either of which we may certainly look forwards to a progressive +increase of population and power; it remains for us to consider in +which way the greatest portion of wealth and happiness may be +steadily secured to the largest mass of the people. + +1. And first let us look to the labouring classes of society, as the +foundation on which the whole fabric rests; and, from their numbers, +unquestionably of the greatest weight, in any estimate of national +happiness. + +If I were convinced, that to open our ports, would be permanently to +improve the condition of the labouring classes of society, I should +consider the question as at once determined in favour of such a +measure. But I own it appears to me, after the most deliberate +attention to the subject, that it will be attended with effects very +different from those of improvement. We are very apt to be deceived +by names, and to be captivated with the idea of cheapness, without +reflecting that the term is merely relative, and that it is very +possible for a people to be miserably poor, and some of them +starving, in a country where the money price of corn is very low. Of +this the histories of Europe and Asia will afford abundant +instances. + +In considering the condition of the lower classes of society, we +must consider only the real exchangeable value of labour; that is, +its power of commanding the necessaries, conveniences, and luxuries +of life. + +I stated in the Observations, and more at large in the Inquiry into +rents,(11*) that under the same demand for labour, and the same +consequent power of purchasing the means of subsistence, a high +money price of corn would give the labourer a very great advantage +in the purchase of the conveniences and luxuries of life. The effect +of this high money price would not, of course, be so marked among +the very poorest of the society, and those who had the largest +families; because so very great a part of their earnings must be +employed in absolute necessaries. But to all those above the very +poorest, the advantage of wages resulting from a price of eighty +shillings a quarter for wheat, compared with fifty or sixty, would +in the purchase of tea, sugar, cotton, linens, soap, candles, and +many other articles, be such as to make their condition decidedly +superior. + +Nothing could counterbalance this, but a much greater demand for +labour; and such an increased demand, in consequence of the opening +of our ports, is at best problematical. The check to cultivation has +been so sudden and decisive, as already to throw a great number of +agricultural labourers out of employment;(12*) and in Ireland this +effect has taken place to such a degree, as to threaten the most +distressing, and even alarming, consequences. The farmers, in some +districts, have entirely lost the little capital they possessed; +and, unable to continue in their farms, have deserted them, and left +their labourers without the means of employment. In a country, the +peculiar defects of which were already a deficiency of capital, and +a redundancy of population, such a check to the means of employing +labour must be attended with no common distress. In Ireland, it is +quite certain, that there are no mercantile capitals ready to take +up those persons who are thus thrown out of work, and even in Great +Britain the transfer will be slow and difficult. + +Our commerce and manufactures, therefore, must increase very +considerably before they can restore the demand for labour already +lost; for the and a moderate increase beyond this will scarcely make +up disadvantage of a low money price of wages. + +These wages will finally be determined by the usual money price of +corn, and the state of the demand for labour. + +There is a difference between what may be called the usual price of +corn and the average price, which has not been sufficiently attended +to. Let us suppose the common price of corn, for four years out of +five, to be about L2 a quarter, and during the fifth year to be L6. +The average price of the five years will then be L2 16s.; but the +usual price will still be about L2, and it is by this price, and not +by the price of a year of scarcity, or even the average including +it, that wages are generally regulated. + +If the ports were open, the usual price of corn would certainly +fall, and probably the average price; but from at has before been +said of the existing laws of France, and of the practice among the +Baltic nations of raising the tax on their exported corn in +proportion to the demand for it, there is every reason to believe, +that the fluctuations of price would be much greater. Such would, at +least, be my conclusion from theory; and, I think, it has been +confirmed by the experience of the last hundred years. During this +time, the period of our greatest importations, and of our greatest +dependence upon foreign corn, was from 1792 to 1805 inclusive; and +certainly in no fourteen years of the whole hundred were the +fluctuations of price so great. In 1792 the price was 42s. a +quarter; in 1796, 77s.; in 1801, 118s. a quarter; and, in 1803, 56s. +Between the year 1792 and 1801 the rise was almost a triple, and in +the short period from 1798 to 1803, it rose from 50s. to 118s. and +fell again to 56s.(13*) + +I would not insist upon this existence as absolutely conclusive, on +account of the mixture of accident in all such appeals to facts; but +it certainly tends to confirm the probability of those great +fluctuations which, according to all general principles, I should +expect from the temper and customs of nations, with regard to the +egress of corn, when it is scarce; and particularly from the +existing laws of that country, which, in all common years, will +furnish us with a large proportion of our supplies. + +To these causes of temporary fluctuations, during peace, should be +added the more durable as well as temporary, fluctuations occasioned +by war. Without reference to the danger of excessive scarcity from +another combination against us, if we are merely driven back at +certain distant intervals upon our own resources, the experience of +the present times will teach us not to estimate lightly the +convulsion which attends the return, and the evils of such +alternations of price. + +In the Observations, I mentioned some causes of fluctuations which +would attend the system of restrictions; but they are in my opinion +inconsiderable, compared with those which have been just referred +to. + +On the labouring classes, therefore, the effects of opening our +ports for the free importation of foreign corn, will be greatly to +lower their wages, and to subject them to much greater fluctuations +of price. And, in this state of things, it will require a much +greater increase in the demand for labour, than there is in any +rational ground for expecting, to compensate to the labourer the +advantages which he loses in the high money wages of labour, and the +steadier and less fluctuating price of corn. + +2. Of the next most important class of society, those who live upon +the profits of stock, one half probably are farmers, or immediately +connected with farmers; and of the property of the other half, not +above one fourth is engaged in foreign trade. + +Of the farmers it is needless to say anything. It cannot be doubted +that they will suffer severely from the opening of the ports. Not +that the profits of farming will not recover themselves, after a +certain period, and be as great, or perhaps greater, than they were +before; but this cannot take place till after a great loss of +agricultural capital, or the removal of it into the channels of +commerce and manufactures. + +Of the commercial and manufacturing part of the society, only those +who are directly engaged in foreign trade, will feel the benefit of +the importing system. It is of course to be expected, that the +foreign trade of the nation will increase considerably. If it do +not, indeed, we shall have experienced a very severe loss, without +anything like a compensation for it. And if this increase merely +equals the loss of produce sustained by agriculture, the quantity of +other produce remaining the same, it is quite clear that the country +cannot possibly gain by the exchange, at whatever price it may buy +or sell. Wealth does not consist in the dearness or cheapness of the +usual measure of value, but in the quantity of produce; and to +increase effectively this quantity of produce, after the severe +check sustained by agriculture, it is necessary that commerce should +make a very powerful start. + +In the actual state of Europe and the prevailing jealousy of our +manufactures, such a start seems quite doubtful; and it is by no +means impossible that we shall be obliged to pay for our foreign +corn, by importing less of other commodities, as well as by +exporting more of our manufactures. + +It may be said, perhaps, that a fall in the price of our corn and +labour, affords the only chance to our manufacturers of retaining +possession of the foreign markets; and that though the produce of +the country may not be increased by the fall in the price of corn, +such a fall is necessary to prevent a positive diminution of it. +There is some weight undoubtedly in this argument. But if we look at +the probable effects of returning peace to Europe, it is impossible +to suppose that, even with a considerable diminution in the price of +labour, we should not lose some markets on the continent, for those +manufactures in which we have no peculiar advantage; while we have +every reason to believe that in others, where our colonies, our +navigation, our long credits, our coals, and our mines come in +question, as well as our skill and capital, we shall retain our +trade in spite of high wages. Under these circumstances, it seems +peculiarly advisable to maintain unimpaired, if possible, the home +market, and not to lose the demand occasioned by so much of the +rents of land, and of the profits and capital of farmers, as must +necessarily be destroyed by the check to our home produce. + +But in whatever way the country may be affected by the change, we +must suppose that those who are immediately engaged in foreign trade +will benefit by it. As those, however, form but a very small portion +of the class of persons living on the profits of stock, in point of +number, and not probably above a seventh or eighth in point of +property, their interests cannot be allowed to weigh against the +interests of so very large a majority. + +With regard to this great majority, it is impossible that they +should not feel very widely and severely the diminution of their +nominal capital by the fall of prices. We know the magic effect upon +industry of a rise of prices. It has been noticed by Hume, and +witnessed by every person who has attended to subjects of this kind. +And the effects of a fall are proportionately depressing. Even the +foreign trade will not escape its influence, though here it may be +counterbalanced by a real increase of demand. But, in the internal +trade, not only will the full effect of this deadening weight be +experienced, but there is reason to fear that it may be accompanied +with an actual diminution of home demand. There may be the same or +even a greater quantity of corn consumed in the country, but a +smaller quantity of manufactures and colonial produce; and our +foreign corn may be purchased in part by commodities which were +before consumed at home. In this case, the whole of the internal +trade must severely suffer, and the wealth and enjoyments of the +country be decidedly diminished. The quantity of a country's exports +is a very uncertain criterion of its wealth. The quantity of produce +permanently consumed at home is, perhaps, the most certain criterion +of wealth to which we can refer. + +Already, in all the country towns, this diminution of demand has +been felt in a very great degree; and the surrounding farmers, who +chiefly support them, are quite unable to make their accustomed +purchases. If the home produce of grain be considerably diminished +by the opening of our ports, of which there can be no doubt, these +effects in the agricultural countries must be permanent, though not +to the same extent as at present. And even if the manufacturing +towns should ultimately increase, in proportion to the losses of the +country, of which there is great reason to doubt, the transfer of +wealth and population will be slow, painful, and unfavourable to +happiness. + +3. Of the class of landholders, it may be truly said, that though +they do not so actively contribute to the production of wealth, as +either of the classes just noticed, there is no class in society +whose interests are more nearly and intimately connected with the +prosperity of the state. + +Some persons have been of opinion, and Adam Smith himself among +others, that a rise or fall of the price of corn does not really +affect the interests of the landholders; but both theory and +experience prove the contrary; and shew, that, under all common +circumstances, a fall of price must be attended with a diminution of +produce, and that a diminution of produce will naturally be attended +with a diminution of rent.(14*) + +Of the effect, therefore, of opening the ports, in diminishing both +the real and nominal rents of the landlords, there can be no doubt; +and we must not imagine that the interest of a body of men, so +circumstanced as the landlords, can materially suffer without +affecting the interests of the state. + +It has been justly observed by Adam Smith, that 'no equal quantity +of productive labour employed in manufactures can ever occasion so +great a reproduction as in agriculture.' If we suppose the rents of +land taken throughout the kingdom to be one fourth of the gross +produce, it is evident, that to purchase the same value of raw +produce by means of manufactures, would require one third more +capital. Every five thousand pounds laid out on the land, not only +repays the usual profits of stock, but generates an additional +value, which goes to the landlord. And this additional value is not +a mere benefit to a particular individual, or set of individuals, +but affords the most steady home demand for the manufactures of the +country, the most effective fund for its financial support, and the +largest disposable force for its army and navy. It is true, that the +last additions to the agricultural produce of an improving country +are not attended with a large proportion of rent;(15*) and it is +precisely this circumstance that may make it answer to a rich +country to import some of its corn, if it can be secure of obtaining +an equable supply. But in all cases the importation of foreign corn +must fail to answer nationally, if it is not so much cheaper than +the corn that can be grown at home, as to equal both the profits and +the rent of the grain which it displaces. + +If two capitals of ten thousand pounds each, be employed, one in +manufactures, and the other in the improvement of the land, with the +usual profits, and withdrawn in twenty years, the one employed in +manufactures will leave nothing behind it, while the one employed on +the land will probably leave a rent of no inconsiderable value. + +These considerations, which are not often attended to, if they do +not affect the ordinary question of a free trade in corn, must at +least be allowed to have weight, when the policy of such a trade is, +from peculiarity of situation and circumstances, rendered doubtful. + +4. We now come to a class of society, who will unquestionably be +benefited by the opening of our ports. These are the stockholders, +and those who live upon fixed salaries.(16*) They are not only, +however, small in number, compared with those who will be affected +in a different manner; but their interests are not so closely +interwoven with the welfare of the state, as the classes already +considered, particularly the labouring classes, and the landlords. + +In the Observations, I remarked, that it was 'an error of the most +serious magnitude to suppose that any natural or artificial causes, +which should raise or lower the values of corn or silver, might be +considered as matters of indifference; and that, practically, no +material change could take place in the value of either, without +producing both temporary and lasting effects, which have a most +powerful influence on the distribution of property.' + +In fact, it is perfectly impossible to suppose that, in any change +in the measure of value, which ever did, or ever can take place +practically, all articles, both foreign and domestic, and all +incomes, from whatever source derived, should arrange themselves +precisely in the same relative proportions as before. And if they do +not, it is quite obvious, that such a change may occasion the most +marked differences in the command possessed by individuals and +classes of individuals over the produce and wealth of the country. +Sometimes the changes of this kind that actually take place, are +favourable to the industrious classes of society, and sometimes +unfavourable. + +It can scarcely be doubted, that one of the main causes, which has +enabled us hitherto to support, with almost undiminished resources, +the prodigious weight of debt which has been accumulated during the +last twenty years, is the continued depreciation of the measure in +which it has been estimated, and the great stimulus to industry, and +power of accumulation, which have been given to the industrious +classes of society by the progressive rise of prices. As far as this +was occasioned by excessive issues of paper, the stockholder was +unjustly treated, and the industrious classes of society benefited +unfairly at his expense. But, on the other hand, if the price of +corn were now to fall to 50 shillings a quarter, and labour and +other commodities nearly in proportion, there can be no doubt that +the stockholder would be benefited unfairly at the expense of the +industrious classes of society, and consequently at the expense of +the wealth and prosperity of the whole country. + +During the twenty years, beginning with 1794 and ending with 1813, +the average price of British corn per quarter was about eighty-three +shillings; during the ten years ending with 1813, ninety-two +shillings; and during the last five years of the twenty, one hundred +and eight shillings. In the course of these twenty years, the +government borrowed near five hundred millions of real capital, for +which on a rough average, exclusive of the sinking fund, it engaged +to pay about five per cent. But if corn should fall to fifty +shillings a quarter, and other commodities in proportion, instead of +an interest of about five per cent. the government would really pay +an interest of seven, eight, nine, and for the last two hundred +millions, ten per cent. + +To this extraordinary generosity towards the stockholders, I should +be disposed to make no kind of objection, if it were not necessary +to consider by whom it is to be paid; and a moment's reflection will +shew us, that it can only be paid by the industrious classes of +society and the landlords, that is, by all those whose nominal +incomes will vary with the variations in the measure of value. The +nominal revenues of this part of the society, compared with the +average of the last five years, will be diminished one half; and out +of this nominally reduced income, they will have to pay the same +nominal amount of taxation. + +The interest and charges of the national debt, including the sinking +fund, are now little short of L40 millions a year; and these L40 +millions, if we completely succeed in the reduction of the price of +corn and labour, are to be paid in future from a revenue of about +half the nominal value of the national income in 1813. + +If we consider, with what an increased weight the taxes on tea, +sugar, malt, leather, soap, candles, etc., etc. would in this case +bear on the labouring classes of society, and what proportion of +their incomes all the active, industrious middle orders of the +state, as well as the higher orders, must pay in assessed taxes, and +the various articles of the customs and excise, the pressure will +appear to be absolutely intolerable. Nor would even the ad valorem +taxes afford any real relief. The annual fourty millions, must at +all events be paid; and if some taxes fail, others must be imposed +that will be more productive. + +These are considerations sufficient to alarm even the stockholders +themselves. indeed, if the measure of value were really to fall, as +we have supposed, there is great reason to fear that the country +would be absolutely unable to continue the payment of the present +interest of the national debt. + +I certainly do not think, that by opening our ports to the freest +admission of foreign corn, we shall lower the price to fifty +shillings a quarter. I have already given my reasons for believing +that the fluctuations which in the present state of Europe, a system +of importation would bring with it, would be often producing dear +years, and throwing us back again upon our internal resources. But +still there is no doubt whatever, that a free influx of foreign +grain would in all commonly favourable seasons very much lower its +price. + +Let us suppose it lowered to sixty shillings a quarter, which for +periods of three or four years together is not improbable. The +difference between a measure of value at 60 compared with 80 (the +price at which it is proposed to fix the importation), is 33 1/3 per +cent. This percentage upon 40 millions amounts to a very formidable +sum. But let us suppose that corn does not effectually regulate the +prices of other commodities; and, making allowances on this account, +let us take only 25, or even 20 per cent. Twenty per cent. upon 40 +millions amounts at once to 8 millions--a sum which ought to go a +considerable way towards a peace establishment; but which, in the +present case, must go to pay the additional interest of the national +debt, occasioned by the change in the measure of value. And even if +the price of corn be kept up by restrictions to 80 shillings a +quarter, it is certain that the whole of the loans made during the +war just terminated, will on an average, be paid at an interest very +much higher than they were contracted for; which increased interest +can, of course, only be furnished by the industrious classes of +society. + +I own it appears to me that the necessary effect of a change in the +measure of value on the weight of a large national debt is alone +sufficient to make the question fundamentally different from that of +a simple question about a free or restricted trade; and, that to +consider it merely in this light, and to draw our conclusions +accordingly, is to expect the same results from premises which have +essentially changed their nature. From this review of the manner in +which the different classes of society will be affected by the +opening of our ports, I think it appears clearly, that very much the +largest mass of the people, and particularly of the industrious +orders of the state, will be more injured than benefited by the +measure. + +I have now stated the grounds on which it appears to me to be wise +and politic, in the actual circumstances of the country, to restrain +the free importation of foreign corn. + +To put some stop to the progressive loss of agricultural capital, +which is now taking place, and which it will be by no means easy to +recover, it might be advisable to pass a temporary act of +restriction, whatever may be the intention of the legislature in +future. But, certainly it is much to be wished that as soon as +possible, consistently with due deliberation, the permanent policy +intended to be adopted with regard to the trade in corn should be +finally settled. Already, in the course of little more than a +century, three distinct changes in this policy have taken place. The +act of William, which gave the bounty, combined with the prohibitory +act of Charles II was founded obviously and strikingly upon the +principle of encouraging exportation and discouraging importation; +the spirit of the regulations adopted in 1773, and acted upon some +time before, was nearly the reverse, and encouraged importation and +discouraged exportation. Subsequently, as if alarmed at the +dependence of the country upon foreign corn, and the fluctuations of +price which it had occasioned, the legislature in a feeble act of +1791, and rather a more effective one in 1804, returned again to the +policy of restrictions. And if the act of 1804 be left now +unaltered, it may be fairly said that a fourth change has taken +place; as it is quite certain that, to proceed consistently upon a +restrictive system, fresh regulations become absolutely necessary to +keep pace with the progressive fall in the value of currency. + +Such changes in the spirit of our legislative enactments are much to +be deprecated; and with a view to a greater degree of steadiness in +future, it is quite necessary that we should be so fully prepared +for the consequences which belong to each system, as not to have our +determinations shaken by them, when they occur. + +If, upon mature deliberation, we determine to open our ports to the +free admission of foreign grain, we must not be disturbed at the +depressed state, and diminished produce of our home cultivation; we +must not be disturbed at our becoming more and more dependent upon +other nations for the main support of our population; we must not be +disturbed at the greatly increased pressure of the national debt +upon the national industry; and we must not be disturbed at the +fluctuations of price, occasioned by the very variable supplies, +which we shall necessarily receive from France, in the actual state +of her laws, or by the difficulty and expense of procuring large, +and sudden imports from the Baltic, when our wants are pressing. +These consequences may all be distinctly foreseen. Upon all general +principles, they belong to the opening of our ports, in the actual +state and relations of this country to the other countries of +Europe; and though they may be counterbalanced or more than +counterbalanced, by other advantages, they cannot, in the nature of +things, be avoided. + +On the other hand, if, on mature deliberation, we determine steadily +to pursue a system of restrictions with regard to the trade in corn, +we must not be disturbed at a progressive rise in the price of +grain; we must not be disturbed at the necessity of altering, at +certain intervals, our restrictive laws according to the state of +the currency, and the value of the precious metals; we must not be +disturbed at the progressive diminution of fixed incomes; and we +must not be disturbed at the occasional loss or diminution of a +continental market for some of our least peculiar manufactures, +owing to the high price of our labour.(17*) All these disadvantages +may be distinctly foreseen. According to all general principles they +strictly belong to the system adopted; and, though they may be +counterbalanced, and more than counterbalanced, by other greater +advantages, they cannot, in the nature of things, be avoided, if we +continue to increase in wealth and population. + +Those who promise low prices upon the restrictive system, take an +erroneous view of the causes which determine the prices of raw +produce, and draw an incorrect inference from the experience of the +first half of the last century. As I have stated in another +place,(18*) a nation which very greatly gets the start of its +neighbours in riches, without any peculiar natural facilities for +growing corn, must necessarily submit to one of these +alternatives--either a very high comparative price of grain, or a +very great dependence upon other countries for it. + +With regard to the specific mode of regulating the importation of +corn, if the restrictive system be adopted, I am not sufficiently +acquainted with the details of the subject to be able to speak with +confidence. It seems to be generally agreed, that, in the actual +state of things, a price of about eighty shillings a quarter(19*) +would prevent our cultivation from falling back, and perhaps allow +it to be progressive. But, in future, we should endeavour, if +possible, to avoid all discussions about the necessity of protecting +the British farmer, and securing to him a fair living profit. Such +language may perhaps be allowable in a crisis like the present. But +certainly the legislature has nothing to do with securing to any +classes of its subjects a particular rate of profits in their +different trades. This is not the province of a government; and it +is unfortunate that any language should be used which may convey +such an impression, and make people believe that their rulers ought +to listen to the accounts of their gains and losses. + +But a government may certainly see sufficient reasons for wishing to +secure an independent supply of grain. This is a definite, and may +be a desirable, object, of the same nature as the Navigation Act; +and it is much to be wished, that this object, and not the interests +of farmers and landlords, should be the ostensible, as well as the +real, end which we have in view, in all our inquiries and +proceedings relating to the trade in corn. + +I firmly believe that, in the actual state of Europe, and under the +actual circumstances of our present situation, it is our wisest +policy to grow our own average supply of corn; and, in so doing, I +feel persuaded that the country has ample resources for a great and +continued increase of population, of power, of wealth, and of +happiness. + +NOTES: + +1. Some of my friends were of different opinions as to the side, +towards which my arguments most inclined. This I consider as a +tolerably fair proof of impartiality. + +2. Mercantile losses are always comparatively partial; but the +present losses, occasioned by the unusual combination of low prices, +and scanty produce, must inflict a severe blow upon the whole mass +of cultivators. There never, perhaps, was known a year more +injurious to the interests of agriculture. + +3. At the same time, I certainly now very much wish that some +regulation had been adopted last year. It would have saved the +nation a great loss of agricultural capital, which it will take some +time to recover. But it was impossible to foresee such a year as the +present--such a combination, as a very bad harvest, and very low +prices. + +4. I have very little doubt that the value of paper in this country +has already risen, norwithstanding the increased issues of the Bank. +These increased issues I attribute chiefly to the great failures +which have taken place among country banks, and the very great +purchases which have been made for the continental markets, and, +under these circumstances, increased issues might take place, +accompanied even by a rise of value. But the currency has not yet +recovered itself. The real exchange, during the last year, must have +been greatly in our favour, although the nominal exchange is +considerably against us. This shews, incontrovertibly, that our +currency is still depreciated, in reference to the bullion +currencies of the continent. A part, however, of this depreciation +may still be owing to the value of bullion in Europe not having yet +fallen to its former level. + +5. Calculated at twenty-four livres the pound sterling. + +6. It has been supposed by some, that this law cannot, and will not +be executed: but I own I see no grounds for such an opinion. It is +difficult to execute prohibitions against the exportation of corn, +when it is in great plenty, but not when it is scarce. For ten years +before 1757, we had in this country, regularly exported on an +average, above 400,000 quarters of wheat, and in that year there was +at once an excess of importation. With regard to the alleged +impotence of governments in this respect, it appears to me that +facts shew their power rather than their weakness. To be convinced +of this, it is only necessary to look at the diminished importations +from America during the war, and particularly from the Baltic after +Bonaparte's decrees. The imports from France and the Baltic in 1810, +were by special licences, granted for purposes of revenue. Such +licences shewed strength rather than weakness; and might have been +refused, if a greater object than revenue had at that time presented +itself. + +7. The average is 16 francs, 21 centimes, the Hectolitre. The +Hectolitre is about 1-20th less than 3 Winchester bushels, which +makes the English quarter come to about 38 shillings. + +8. It appears from the evidence, that the corn from the Baltic is +often very heavily taxed, and that this tax is generally raised in +proportion to our necessities. In a scarce year in this country we +could never get any considerable quantity of corn from the Baltic, +without paying an enormous price for it. + +9. By the real growing price of corn I mean the real quantity of +labour and capital which has been employed to procure the last +additions which have been made to the national produce. In every +rich and improving country there is a natural and strong tendency to +a constantly increasing price of raw produce, owing to the necessity +of employing, progressively, land of an inferior quality. But this +tendency may be partially counteracted by great improvements in +cultivation, and economy of labour. See this subject treated in An +inquiry into the nature and progress of rent, just published. + +10. Sir John Sinclair's Account of the Husbandry of Scotland: and +the General Report of Scotland. + +11. "Inquiry into the Nature and Progress of Rent, and the +Principles by which it is regulated." + +12. I was not prepared to expect (as I intimated in the +Observations) so sudden a fall in the price of labour as has already +taken place. This fall has been occasioned, not so much by the low +price of corn, as by the sudden stagnation of agricultural work, +occasioned by a more sudden check to cultivation than I foresaw. + +13. I am strongly disposed to believe, that it is owning to the +unwillingness of governments to allow the free egress of their corn, +when it is scarce, that nations are practically so little dependent +upon each other for corn, as they are found to be. According to all +general principles they ought to be more dependent. But the great +fluctuations in the price of corn, occasioned by this unwillingness, +tend to throw each country back again upon its internal resources. +This was remarkably the case with us in 1800 and 1801, when the very +high price, which we paid for foreign corn, gave a prodigious +stimulus to our domestic agriculture. A large territorial country, +that imports foreign corn, is exposed not infrequently to the +fluctuations which belong to this kind of variable dependence, +without obtaining the cheapness that ought to accompany a trade in +corn really free. + +14. See this subject treated in An Inquiry into the Nature and +Progress of Rents. + +15. Inquiry into the Nature and Progress of Rent. + +16. It is to this class of persons that I consider myself as chiefly +belonging. Much the greatest part of my income is derived from a +fixed salary and the interest of money in the funds. + +17. It often happens that the high prices of a particular country +may diminish the quantity of its exports without diminishing the +value of their amount abroad; in which case its foreign trade is +peculiarly advantageous, as it purchases the same amount of foreign +commodities at a much less expense of labour and capital. + +18. Inquiry into the Nature and Progress of Rent. + +19. This price seems to be pretty fairly consistent with the idea of +getting rid of that part of our high prices which belongs to +excessive issues of paper, and retaining only that part which +belongs to great wealth, combined with a system of restrictions. + + + + +End of Project Gutenberg's Importation of Foreign Corn, by Thomas Malthus + diff --git a/old/mpfcr10.zip b/old/mpfcr10.zip Binary files differnew file mode 100644 index 0000000..ba47b81 --- /dev/null +++ b/old/mpfcr10.zip |