The Wealth of Nations

Though the encouragement of exportation, and the discouragement of importation, are the two great engines by which the mercantile system proposes to enrich every country, yet, with regard to some particular commodities, it seems to follow an opposite plan: to discourage exportation, and to encourage importation. Its ultimate object, however, it pretends, is always the same, to enrich the country by an advantageous balance of trade. It discourages the exportation of the materials of manufacture, and of the instruments of trade, in order to give our own workmen an advantage, and to enable them to undersell those of other nations in all foreign markets; and by restraining, in this manner, the exportation of a few commodities, of no great price, it proposes to occasion a much greater and more valuable exportation of others. It encourages the importation of the materials of manufacture, in order that our own people may be enabled to work them up more cheaply, and thereby prevent a greater and more valuable importation of the manufactured commodities. I do not observe, at least in our statute book, any encouragement given to the importation of the instruments of trade. When manufactures have advanced to a certain pitch of greatness, the fabrication of the instruments of trade becomes itself the object of a great number of very important manufactures. To give any particular encouragement to the importation of such instruments, would interfere too much with the interest of those manufactures. Such importation, therefore, instead of being encouraged, has frequently been prohibited. Thus the importation of wool cards, except from Ireland, or when brought in as wreck or prize goods, was prohibited by the 3rd of Edward IV.; which prohibition was renewed by the 39th of Elizabeth, and has been continued and rendered perpetual by subsequent laws. The importation of the materials of manufacture has sometimes been encouraged by an exemption from the duties to which other goods are subject, and sometimes by bounties. The importation of sheep’s wool from several different countries, of cotton wool from all countries, of undressed flax, of the greater part of dyeing drugs, of the greater part of undressed hides from Ireland, or the British colonies, of seal skins from the British Greenland fishery, of pig and bar iron from the British colonies, as well as of several other materials of manufacture, has been encouraged by an exemption from all duties, if properly entered at the custom-house. The private interest of our merchants and manufacturers may, perhaps, have extorted from the legislature these exemptions, as well as the greater part of our other commercial regulations. They are, however, perfectly just and reasonable; and if, consistently with the necessities of the state, they could be extended to all the other materials of manufacture, the public would certainly be a gainer. The avidity of our great manufacturers, however, has in some cases extended these exemptions a good deal beyond what can justly be considered as the rude materials of their work. By the 24th Geo. II. chap. 46, a small duty of only 1d. the pound was imposed upon the importation of foreign brown linen yarn, instead of much higher duties, to which it had been subjected before, viz. of 6d. the pound upon sail yarn, of 1s. the pound upon all French and Dutch yarn, and of £2:13:4 upon the hundred weight of all spruce or Muscovia yarn. But our manufacturers were not long satisfied with this reduction: by the 29th of the same king, chap. 15, the same law which gave a bounty upon the exportation of British and Irish linen, of which the price did not exceed 18d. the yard, even this small duty upon the importation of brown linen yarn was taken away. In the different operations, however, which are necessary for the preparation of linen yarn, a good deal more industry is employed, than in the subsequent operation of preparing linen cloth from linen yarn. To say nothing of the industry of the flax-growers and flaxdressers, three or four spinners at least are necessary in order to keep one weaver in constant employment; and more than four-fifths of the whole quantity of labour necessary for the preparation of linen cloth, is employed in that of linen yarn; but our spinners are poor people; women commonly scattered about in all different parts of the country, without support or protection. It is not by the sale of their work, but by that of the complete work of the weavers, that our great master manufacturers make their profits. As it is their interest to sell the complete manufacture as dear, so it is to buy the materials as cheap as possible. By extorting from the legislature bounties upon the exportation of their own linen, high duties upon the importation of all foreign linen, and a total prohibition of the home consumption of some sorts of French linen, they endeavour to sell their own goods as dear as possible. By encouraging the importation of foreign linen yarn, and thereby bringing it into competition with that which is made by our own people, they endeavour to buy the work of the poor spinners as cheap as possible. They are as intent to keep down the wages of their own weavers, as the earnings of the poor spinners; and it is by no means for the benefit of the workmen that they endeavour either to raise the price of the complete work, or to lower that of the rude materials. It is the industry which is carried on for the benefit of the rich and the powerful, that is principally encouraged by our mercantile system. That which is carried on for the benefit of the poor and the indigent is too often either neglected or oppressed. Both the bounty upon the exportation of linen, and the exemption from the duty upon the importation of foreign yarn, which were granted only for fifteen years, but continued by two different prolongations, expire with the end of the session of parliament which shall immediately follow the 24th of June 1786. The encouragement given to the importation of the materials of manufacture by bounties, has been principally confined to such as were imported from our American plantations. The first bounties of this kind were those granted about the beginning of the present century, upon the importation of naval stores from America. Under this denomination were comprehended timber fit for masts, yards, and bowsprits; hemp, tar, pitch, and turpentine. The bounty, however, of £1 the ton upon masting-timber, and that of £6 the ton upon hemp, were extended to such as should be imported into England from Scotland. Both these bounties continued, without any variation, at the same rate, till they were severally allowed to expire; that upon hemp on the 1st of January 1741, and that upon masting-timber at the end of the session of parliament immediately following the 24th June 1781. The bounties upon the importation of tar, pitch, and turpentine, underwent, during their continuance, several alterations. Originally, that upon tar was £4 the ton; that upon pitch the same; and that upon turpentine £3 the ton. The bounty of £4 the ton upon tar was afterwards confined to such as had been prepared in a particular manner; that upon other good, clean, and merchantable tar was reduced to £2:4s. the ton. The bounty upon pitch was likewise reduced to £1, and that upon turpentine to £1:10s. the ton. The second bounty upon the importation of any of the materials of manufacture, according to the order of time, was that granted by the 21st Geo. II. chap.30, upon the importation of indigo from the British plantations. When the plantation indigo was worth three-fourths of the price of the best French indigo, it was, by this act, entitled to a bounty of 6d. the pound. This bounty, which, like most others, was granted only for a limited time, was continued by several prolongations, but was reduced to 4d. the pound. It was allowed to expire with the end of the session of parliament which followed the 25th March 1781. The third bounty of this kind was that granted (much about the time that we were beginning sometimes to court, and sometimes to quarrel with our American colonies), by the 4th. Geo. III. chap. 26, upon the importation of hemp, or undressed flax, from the British plantations. This bounty was granted for twenty-one years, from the 24th June 1764 to the 24th June 1785. For the first seven years, it was to be at the rate of £8 the ton; for the second at £6; and for the third at £4. It was not extended to Scotland, of which the climate (although hemp is sometimes raised there in small quantities, and of an inferior quality) is not very fit for that produce. Such a bounty upon the importation of Scotch flax in England would have been too great a discouragement to the native produce of the southern part of the united kingdom. The fourth bounty of this kind was that granted by the 5th Geo. III. chap. 45, upon the importation of wood from America. It was granted for nine years from the 1st January 1766 to the 1st January 1775. During the first three years, it was to be for every hundred-and-twenty good deals, at the rate of £1, and for every load containing fifty cubic feet of other square timber, at the rate of 12s. For the second three years, it was for deals, to be at the rate of 15s., and for other squared timber at the rate of 8s.; and for the third three years, it was for deals, to be at the rate of 10s.; and for every other squared timber at the rate of 5s. The fifth bounty of this kind was that granted by the 9th Geo. III. chap. 38, upon the importation of raw silk from the British plantations. It was granted for twenty-one years, from the 1st January 1770, to the 1st January 1791. For the first seven years, it was to be at the rate of £25 for every hundred pounds value; for the second, at £20; and for the third, at £15. The management of the silk-worm, and the preparation of silk, requires so much hand-labour, and labour is so very dear in America, that even this great bounty, I have been informed, was not likely to produce any considerable effect. The sixth Bounty of this kind was that granted by 11th Geo. III. chap. 50, for the importation of pipe, hogshead, and barrelstaves and leading from the British plantations. It was granted for nine years, from 1st January 1772 to the 1st January 1781. For the first three years, it was, for a certain quantity of each, to be at the rate of £6; for the second three years at £4; and for the third three years at £2. The seventh and last bounty of this kind was that granted by the 19th Geo. III chap. 37, upon the importation of hemp from Ireland. It was granted in the same manner as that for the importation of hemp and undressed flax from America, for twenty-one years, from the 24th June 1779 to the 24th June 1800. The term is divided likewise into three periods, of seven years each; and in each of those periods, the rate of the Irish bounty is the same with that of the American. It does not, however, like the American bounty, extend to the importation of undressed flax. It would have been too great a discouragement to the cultivation of that plant in Great Britain. When this last bounty was granted, the British and Irish legislatures were not in much better humour with one another, than the British and American had been before. But this boon to Ireland, it is to be hoped, has been granted under more fortunate auspices than all those to America. The same commodities, upon which we thus gave bounties, when imported from America, were subjected to considerable duties when imported from any other country. The interest of our American colonies was regarded as the same with that of the mother country. Their wealth was considered as our wealth. Whatever money was sent out to them, it was said, came all back to us by the balance of trade, and we could never become a farthing the poorer by any expense which we could lay out