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own commercial profits (a circumstance which speaks to its
advantage rather than to its disadvantage); is clear and
indisputable。 Still less do we mean to deny the extraordinary cases
where the greater exportation rather denotes loss of value than
gain; as e。g。 if property is lost by shipwreck。 The popular school
has made clever use of all those delusions arising from a
shopkeeper…like calculation and comparison of the value of the
exchanges arising from the exports and imports; in order to make us
disbelieve in the disadvantages which result from a real and
enormous disproportion between the exports and imports of any great
and independent nation; even though such disproportion be not
permanent; which shows itself in such immense sums as for instance
in the case of France in 1786 and 1789; in that of Russia in 1820
and 1821; and in that of the United States of North America after
the 'Compromise Bill。'
Finally; we desire to speak (and this must be specially noted)
not of colonies; not of dependent countries; not of small states or
of single independent towns; but of entire; great; independent
nations; which possess a commercial system of their own; a national
system of agriculture and industry; a national system of money and
credit。
It evidently consists with the character of colonies that their
exports can surpass their imports considerably and continuously;
without thereby involving any conclusion as to the decrease or
increase of their prosperity。 The colony always prospers in the
proportion in which the total amount of its exports and imports
increases year by year。 If its export of colonial produce exceeds
its imports of manufactured goods considerably and lastingly the
main cause of this may be that the landed proprietors of the colony
live in the mother country; and that they receive their income in
the shape of colonial goods; in produce; or in the money which has
been obtained for them。 If; however; the exports of fabrics to the
colony exceed the imports of colonial goods considerably; this may
be chiefly due to the fact that by emigrations or loans from year
to year large masses of capital go to the colony。 This latter
circumstance is; of course; of the utmost advantage to the
prosperity of the colony。 It can continue for centuries and yet
commercial crises under such circumstances may be infrequent or
impossible; because the colony is endangered neither by wars nor by
hostile commercial measures; nor by operations of the national bank
of the mother country; because it possesses no independent system
of commerce; credit; and industry peculiar to itself; but is; on
the contrary; supported and constantly upheld by the institutions
of credit and political measures of the mother country。
Such a condition existed for more than a century with advantage
between North America and England; exists still between England and
Canada; and will probably exist for centuries between England and
Australia。
This condition becomes fundamentally changed; however; from the
moment in which the colony appears as an independent nation with
every claim to the attributes of a great and independent
nationality in order that it may develop a power and policy of
its own and its own special system of commerce and credit。 The
former colony then enacts laws for the special benefit of its own
navigation and naval power it establishes in favour of its own
internal industry a customs tariff of its own; it establishes a
national bank of its own; &c。; provided namely that the new nation
thus passing from the position of a colony to independence feels
itself capable; by reason of the mental; physical; and economical
endowments which it possesses; of becoming an industrial and
commercial nation。 The mother country; in consequence; places
restrictions; on its side; on the navigation; commerce; and
agricultural production of the former colony; and acts; by its
institutions of credit; exclusively for the maintenance of its own
national economical conditions。
But it is precisely the instance of the North American colonies
as they existed before the American War of Independence by which
Adam Smith seeks to prove the above…mentioned highly paradoxical
opinion: that a country can continually increase its exportation of
gold and silver; decrease its circulation of the precious metals;
extend its paper circulation; and increase its debts contracted
with other nations while enjoying simultaneously steadily
increasing prosperity。 Adam Smith has been very careful not to cite
the example of two nations which have been independent of one
another for some time; and whose interests of navigation; commerce;
industry; and agriculture are in competition with those of other
rival nations; in proof of his opinion he merely shows us the
relation of a colony to its mother country。 If he had lived to the
present time and only written his book now; he would have been very
careful not to cite the example of North America; as this example
proves in our days just the opposite of what he attempts by it to
demonstrate。
Under such circumstances; however; it may be urged against us
that it would be incomparably more to the advantage of the United
States if they returned again to the position of an English colony。
To this we answer; yes; provided always that the United States do
not know how to utilise their national independence so as to
cultivate and develop a national industry of their own; and a
self…supporting system of commerce and credit which is independent
of the world outside。 But (it may be urged) is it not evident that
if the United States had continued to exist as a British colony no
English corn law would ever have been passed; that England would
never have imposed such high duties on American tobacco; that
continual quantities of timber would have been exported from the
United States to England; that England; far from ever entertaining
the idea of promoting the production of cotton in other countries;
would have endeavoured to give the citizens of the United States a
monopoly in this article; and to maintain it; that consequently
commercial crises such as have occurred within the last decades in
North America; would have been impossible? Yes; if the United
States do not manufacture; if they do not found a durable system of
credit of their own; if they do not desire or are not able to
develop a naval power。 But then; in that case; the citizens of
Boston have thrown the tea into the sea in vain; then all their
declamation as to independence and future national greatness is in
vain: then indeed would they do better if they re…enter as soon as
possible into dependence on England as her colony。 In that event
England will favour them instead of imposing restrictions on them;
she will rather impose restrictions on those who compete with the
North Americans in cotton culture and corn production; &c。 than
raise up with all possible energy competitors against them。 The
Bank of England will then establish branch banks in the United
States; the English Government will promote emigration and the
export of capital to America; and through the entire destruction of
the American manufactories; as well as by favouring the export of
American raw materials and agricultural produce to England; take
maternal care to prevent commercial crises in North America; and to
keep the imports and exports of the colony always at a proper
balance with one another。 In one word; the American slaveholders
and cotton planters will then realise the fulfilment of their
finest dreams。 In fact; such a position has already for some time
past appeared to the patriotism; the interests; and requirements of
these planters more desirable than the national independence and
greatness of the United States。 Only in the first emotions of
liberty and independence did they dream of industrial independence。
They soon; however; grew cooler; and for the last quarter of a
century the industrial prosperity of the middle and eastern states
is to them an abomination; they try to persuade the Congress that
the prosperity of America depends on the industrial sovereignty of
England over North America。 What else can be meant by the assertion
that the United States would be richer and more prosperous if they
again went over to England as a colony?
In general it appears to us that the defenders of free trade