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found; and, at all events, this has now the sanction of use in its favour.

The commercial part of our inquiry will be directed to some consideration of the relative advantages with which a commercial concern may be conducted by a chartered company of merchants, on the one hand, and by private adventurers on the other. Here we must, in some measure, restate arguments pretty well known; but this it is not our purpose to do, unless when they strike us as requiring either to be illustrated or to be qualified. It will be necessary to bring up the rear of our theoretical remarks with re: ferences to facts.

Politically, the administration of the East India Company may be viewed, with regard both to its effects on the welfare and happiness of our Asiatic fellow-subjects, and to its effects at home on the constitution. These two views it will be requisite to combine ; and, no less so, to compare the influence of the present system in both directions, with what may be augured respecting the influence of the systems most likely to contest the honour of superseding it, in the event of its abolition.

We ought, perhaps, by way of preface, to take some notice of a topic, on which the author before us is particularly animated, the origin and early history of the commercial association with which he is so much offended. This, however, seems to us most superfluous. We are told, that the early India Company made good its establishment under favour of the intense commercial ignorance generally prevalent at the period of its institution. Be it so. But, that those who patronized the institution were ignorant, does not necessarily prove the institution to be bad. The Bank of England, the most useful of all commercial organs, was instituted in times of ignorance ; and, if the reader will take the trouble to turn over the history of its formation, he will find it difficult to determine, whether the arguments of its supporters at that period, or those of its opponents, were the more absurd. We are also informed, that the early India Company maintained its ground only by the most scandalous jobbing and bribery. Be this also true. A similar truth may be predicated of the union of Scotland and England.

Further, we do not think our author's representations on this subject quite fair. He quotes these stories of jobbing and bribery partly out of Anderson, without ever hinting to his readers, that Anderson, one of the most enlightened, surely, of the old commercial school, is a staunch advocate for the monopoly of the East Indian trade. Anderson, however, was far from singular in this predilection. Postlethwayt may almost be mentioned,-a man

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of liberality, and by no means incapable of thinking away his prejudices *.

Proceeding to consider the first, which is the purely commercial, part of this question, we will suppose that our readers are acquainted with the observations which it has drawn from Dr Smith, or, at least, that they will take instantaneous measures to verify our conjectures, by poring over every tittle of those ob servations, before they proceed with this humble commentary up- . on them, Like other commentators, however, we occasionally quarrel with our text. We could wish that Dr Smith had at the outset conceded, as it would have cost him but little to concede, the advantage that may, in some cases, result from planting an infant, trade in the nursery-ground of an exclusive company. In the fifth book, however, of his work, he admits, that instances are conceivable, in which a temporary monopoly of this kind may bé vindicated upon the same principles, upon which a like monopoly of a new machine is granted to its inventory and that of a new book to its author ta'

The present question, however, is a widely different one. It is not, Whether an Exclusive Company can be ever useful ? but, Whether it can be for ever useful ? not, Whether a patenť may be adyantageously granted to the first adventurers in a parti. cular line of trade ? but, Whether that patent should not, after a season, expire ? To retail the reasonings of Dr Smith on this head would be absurd ; but we may be forgiven for attempting to mould some part of them into a shape more directly fitted to the present state of the controversy.

That it is for the advantage of every nation to lay out on any particular trade as much capital as can be profitably' vested in it, is a proposition which the great author just named has pretty fully illustrated; but he has not particularly supported it against the common objection bottomed on a supposed distinction between a trade of foreign consumption and a home-trade. It being admitted, that the competition incident to an open trade would raise the prices of Indian commodities in India, and lower them in Europe, the champions of monopoly assert, that this fall of profits, however advantageous to this nation, on the supposition of the commodities imported from India being sold at home, must be the reyerse of advantageous to it, when (as is now the case) they are

mostly

* Mr Clarkson tells us, that, from having been a champion for the A. frican Nave-trade, Postlethwayt became, what his dictionary evinces him to have been, one of the strenuous opponents of that system of murder disguised in the garb of commerce.

† Book. V. ch. !.

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mostly re-exported for foreign consumption. In the latter case, they contend, that the foreign consumer must reap the whole advantage, and that at the expense of the English trader. This argument appears to have been first employed by Child, in the year 1677; * it has since been restated by authors of note; and, as we collect from the publication before us, is still built upon by the East India Directors. Fully, therefore, as its fallacy may be implied in several parts of the Wealth of Nations, we shall endeavour to deduce a direct refutation of it from the principles of that work. The present author, it must be observed, fights it only with the weapon of contempt; a weapon which, though perhaps more painful than that of argument, is unfortunately less effective; as a rusty knife may mangle, but will inflict a less deadly wound than a stilletto.

All trade is carried on for the mutual benefit of the traders on the one hand, and the consumers on the other; and, when it is left free, this mutual benefit both guides and limits its extension. At the first emancipation, indeed, of a particular traffic that has been monopolized, the sudden rush of capital into it may reduce its profits too low; but the first persons to perceive this evil, when it occurs, will obviously be those that suffer by it; and, some portion of this redundant capital being withdrawn into more hopeful employments, the evil will thus correct itself. When, therefore, a trade is permitted to expand itself quietly to the utmost, we may depend on it, that such expansion is beneficial to both the parties concerned, that is, to the trading world, and the consuming world. The profits upon it are, indeed, reduced; but then they are not so much reduced, as the capital invested in it is augmented; for profit is always the measure of the spontaneous investment of capital in a particular channel. Individual traders make less, but the trade gain more : Privatus illis census erit brevis, Communis magnus. Now, when the traders and the consumers both live in the same country, then, on an enlargement of the trade, the country gains both ways; in the increased accommodation to the consumers, and in the increased gains of the commercial world. When, as in the case before us, the traders live here, and the consumers are foreigners, then, though both parties gain by extending the trade, this country benefits only by the increased gains of the traders; but still, all this is clear gain. True it is, that, on this supposition, the argument for laying open, and consequently extending the trade, is only half as strong as it is on the former; but then let it be also noted, that, on this supposition, the argument for pursuing the trade at all, is only half as strong as it is on the for

mer,

* Şee Anderson in anno 1677

mer. Commerce can never be so profitable when it merely ministers to foreign consumption, as when it is employed at home; but it will every where be most lucrative when left to itself, and will seek employment abroad, only when home cannot profitably employ it. : · Might we object to any other portion of Dr Smith's reflections on this subject, as not being fully perfected and rounded, we should perhaps regret, that he had not more scientifically explained the causes from which it happens, that an exclusive company carries on business to less advantage than the private merchant. Some of his expressions might induce an unguarded reader to suppose, that there was a real, as well as a fancied, opposition between the interests of the India Company, considered as merchants and as sovereigns ; that it was really advantageous to a company to raise its profits, by narrowing its own market; and that those companies who have pursued this plan, instead of hava ing miserably mistaken, or grossly neglected their own interests, had only too eagerly consulted it.

The truth is, as the wise need not be informed, that it is as certainly the ultimate interest of a body of monopolists, as of a set of private traders, to trade as cheaply and extensively as possible, and to invest in their concern, every atom of capital which it will absorb. They will evidently find it more lucrative, at the long run, to make smaller profits on a larger capital, than larger profits on a smaller capital. Those companies, therefore, who are said to have destroyed a part of the produce which they could command in India, from a dread of too much cheapening their sales in Europe, committed an absurdity, for which it was hardly worth their while to be so wicked. Corn, rice, and whatever constitutes the staff of life, have, indeed, the property of the Sibylline books offered to the Roman monarch ; and any falling off in the ordinary supply of them, occasions a far more than proportional rise in their price. . Had then the monopolists alluded to, been importers of such articles as these, they might have found a temporary advantage in inflaming the demand for their merchandizes, by suddenly stinting the supply, and thus starving their customers into a capitulation on their own terms. Even this, however, is ultimately a pitiful and short-sighted policy; but since mace and ginger are not bread-fruit,--since nobody but a Fakeer would chuse to live upon cloves,---and since a nutmeg is slow poison ; how childish for a dealer in these commodities to play with the market for them, as if they were the prime necessaries of life! By wasting a part of the usual produce, he only teaches the consumer to manage with less; and by destroying the plenty of an unusually propititious year, he loses the oppor

tunity tunity of whetting the consumer's appetite for more. The reader will perceive, that we refer to that frightful story, so appalling to us in our childhood, of the Dutch and their spiceries : a story exemplifying such a flight of stupidity, as we should naturally expect from a Dutchman, in any case where trade was not the thing concerned. It is like a man putting out one of his eyes, in order to strengthen the sight of the other. "

But it must not be imagined, that we disbelieve this horrible story; and it is most certain, that chartered companies are not apt to push forward their commercial dealings with that vigour which characterizes the speculations of the private capitalist. Why is this, if it be as certainly, as obviously, and as greatly, their interest to do so? We answer, that it is as certainly their interest to do so, but not perhaps as greatly, nor as obviously.

It is not equally their interest, because their charter secures them from the dread of competitors, which, in the mind of the private trader, forms a powerful ally to the simple desire of bettering his condition. The private trader is pushed forward by two impulses,—the hope of gaining, and the fear of losing. The chartered monopolist, for a long time at least, feels the hope without the fear; and, having the race to himself-though he knows that the faster he runs, the sooner he shall entitle himself to the prize—is yet equally convinced, that he cannot lose it, even if he walks. It is true that, in this state of things, he sometimes unexpectedly perceives an interloping rival at his heels ; but his habits of oscitancy and confidence are now not easily shaken off; and the interloper, being better seasoned, (as the jockies would say), and less on his haunches, slips him, while the monopolist follows majestically behind, delighting the beholders with his magnificent curvettings and measured fire. · Besides, commercial exertion and alertness are not so obviously the interest of any large corporate society, chartered or not, as of the private merchant; that is, they are not so obviously . the interest of the individuals composing such a corporation. A member of a numerous association, can seldom have the sensation that every thing depends on his single arm. Man, commercialy considered, is generally actuated by two feelings; the love of present pleasure, inclining him to indolence,—and the love of future pleasure, propelling him to action. Where action, however, is not evidently and directly connected with some future advantage, he will feel its necessity but faintly, and enter upon it with slackness. In large bodies, although the profits of all directly depend on the exertions of all, the individual profits of each man are not so immediately dependent on his individual exertion ; and the love of ease, soon makes the individual discover

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