The manner in which the public can be the best and cheapest supplied with an article, is in itself the best, whether it be by a monopoly or not. This is conceded even by Adam Smith, that great enemy to monopolies; and he adduces in proof the Post Office, which is one of the strictest and most complete monopolies in existence, yet the business is done remarkably cheap and well, and with a degree of security not otherwise attainable. It is infinitely more correct than the carriage of small parcels, which is by open competition, and all circumstances considered much cheaper.
The Bank of England is partly a monopoly, but by no means a complete one, and it is better regulated and does business better than private banks that issue notes, and which are so far its rivals.
Most of the concerns which have been brought to maturity in this country have first flourished as monopolies under the name of patents, and indeed there are many reasons for highly praising those temporary monopolies.[C]
The insurance companies are not exactly monopolies, neither are they free traders in the true acceptation of the term, jointly or separately taking insurances without legislative interference; and, without such companies, it would be impracticable to carry on insurance so well as it is done.
Navigations and water-works companies are monopolies in principle, but they are necessary and advantageous.
From all these examples it follows, that monopoly is not bad merely as monopoly, and that its being injurious depends on particular circumstances, and therefore the India Company being a company of monopolists, would not be a sufficient reason for its abolition, even were it proved to be so, but this has not yet been done.
II. That the Trade with India is far from being carried on, upon the principle of monopoly.
From the first discovery of India, and the most ancient and authentic records in existence, we learn that the trade to the East, which produces whatever is most brilliant to the eye, most delicious to the taste, or agreeable to the smell, has been the envy of nations. To share in them, Solomon built Tadmor in the desert, (the Hebrew name, in Greek, Palmyra); for this Alexander the Great destroyed Tyre, built Alexandria and invaded India; for this trade Venice, Genoa, and Constantinople contended above eight hundred years, when the discovery of a passage by the Cape of Good Hope, wrested that commerce from the ancient competitors, and the Dutch and Portuguese became the successors of those inland merchants, who partly by caravans and partly by navigation, had supplied Europe with the silks, the pearls, the perfumes, and the precious stones of Asia from the earliest ages.
At so great a distance every power that traded found it necessary to have an establishment. The Inhabitants have not laws sufficient to protect the merchant, such as are necessary to a flourishing state of commerce; hence arose settlements and conquests, of the moral justice of which, I have nothing to say in this place; but being established, in order to maintain them, it was necessary to have revenues, and to continue certain privileges to the first traders, in order that they might act as a body, and supply from the general stock what was for the general advantage.
The great body of the public are perhaps not aware that so far from ever intending to make a monopoly of the trade to India, there were in fact two companies at one time, and that experience proved it was necessary to unite them into one, since which period, the public, as well as the servants of the company have always been permitted to participate on certain conditions.[D]