Our jealousy and our hatred of France are without bounds, and the former sentiment at least must be {p57} acknowledged very reasonable and well-grounded. These passions have occasioned innumerable barriers and obstructions upon commerce, where we are accused of being commonly the aggressors. But what have we gained by the bargain? We lost the French market for our woollen manufactures, and transferred the commerce of wine to Spain and Portugal, where we buy much worse liquor at a higher price. There are few Englishmen who would not think their country absolutely ruined were French wines sold in England so cheap and in such abundance as to supplant, in some measure, all ale and home-brewed liquors; but would we lay aside prejudice, it would not be difficult to prove that nothing could be more innocent, perhaps advantageous. Each new acre of vineyard planted in France, in order to supply England with wine, would make it requisite for the French to take the produce of an English acre, sown in wheat or barley, in order to subsist themselves; and it is evident that we have thereby got command of the better commodity.
There are many edicts of the French King prohibiting the planting of new vineyards, and ordering all those already planted to be grubbed up, so sensible are they in that country of the superior value of corn above every other product.
Mareschal Vauban complains often, and with reason, of the absurd duties which load the entry of those wines of Languedoc, Guienne, and other southern provinces that are imported into Brittany and Normandy. He entertained no doubt but these latter provinces could preserve their balance notwithstanding the open commerce which he recommends. And it is evident that a few leagues more navigation to England would make no difference; or if it did, that it must operate alike on the commodities of both kingdoms.
There is indeed one expedient by which it is possible to sink, and another by which we may raise, money beyond its natural level in any kingdom; but these cases, when examined, will be found to resolve into our general theory, and to bring additional authority to it. {p58}
I scarce know any method of sinking money below its level but those institutions of banks, funds, and paper-credit which are so much practised in this kingdom. These render paper equivalent to money, circulate it through the whole state, make it supply the place of gold and silver, raise proportionally the price of labour and commodities, and by that means either banish a great part of those precious metals, or prevent their further increase. What can be more short-sighted than our reasonings on this head? We fancy, because an individual would be much richer were his stock of money doubled, that the same good effect would follow were the money of every one increased, not considering that this would raise as much the price of every commodity, and reduce every man in time to the same condition as before. It is only in our public negotiations and transactions with foreigners that a greater stock of money is advantageous; and as our paper is there absolutely insignificant, we feel, by its means, all the ill effects arising from a great abundance of money without reaping any of the advantages.[19]
Suppose that there are twelve millions of paper which circulate in the kingdom as money (for we are not to imagine that all our enormous funds are employed in that shape), and suppose the real cash of the kingdom to be eighteen millions: here is a state which is found by experience able to hold a stock of thirty millions. I say, if it be able to hold it, it must of necessity have acquired it in gold and silver had we not obstructed the entrance of these metals by this new invention of paper. Whence would it have acquired that sum? From all the kingdoms of the world. But why? Because, if you remove these twelve millions, money in this state is below its level compared with our {p59} neighbours; and we must immediately draw from all of them till we be full and saturate, so to speak, and can hold no more. By our present politics we are as careful to stuff the nation with this fine commodity of bank-bills and chequer notes as if we were afraid of being overburdened with the precious metals.
It is not to be doubted but the great plenty of bullion in France is, in a great measure, owing to the want of paper-credit. The French have no banks; merchants’ bills do not there circulate as with us; usury or lending on interest is not directly permitted, so that many have large sums in their coffers; great quantities of plate are used in private houses, and all the churches are full of it. By this means provision and labour still remain much cheaper among them than in nations that are not half so rich in gold and silver. The advantages of this situation in point of trade, as well as in great public emergencies, are too evident to be disputed.
The same fashion a few years ago prevailed in Genoa which still has place in England and Holland, of using services of china ware instead of plate; but the Senate, wisely foreseeing the consequence, prohibited the use of that brittle commodity beyond a certain extent, while the use of silver plate was left unlimited. And I suppose, in their late distresses, they felt the good effect of this ordinance. Our tax on plate is, perhaps, in this view, somewhat impolitic.
Before the introduction of paper-money into our colonies, they had gold and silver sufficient for their circulation. Since the introduction of that commodity, the least inconveniency that has followed is the total banishment of the precious metals. And after the abolition of paper, can it be doubted but money will return, while these colonies possess manufactures and commodities, the only thing valuable in commerce, and for whose sake alone all men desire money?
What pity Lycurgus did not think of paper-credit when he wanted to banish gold and silver from Sparta! It would {p60} have served his purpose better than the lumps of iron he made use of as money, and would also have prevented more effectually all commerce with strangers, as being of so much less real and intrinsic value.