Money and trade considered

by John Law

’Tis alledged, that the allowing the wooll to be exported, occasioned the exportation of the money. that at one time 5000 lib. was sent to England to buy wooll. ’tis askt what became of that wooll? they answer, it was sent to France for wine. then, as 5000 lib. of English wooll may be worth 8 or 10 thousand pound in France; so the 5000 lib. sent to England, saved the sending out of 8 or 10000 lib. to France.

To those who don’t throughly examine the state of this country, it may seem odd that wooll should be allowed by law to be exported: but if the product of Scotland cannot be manufactur’d with less than 50000 people, and the money that can be spar’d to manufacture, be only capable to employ 25000, one half of the product will be lost if it is not allowed to be exported.

The 5th branch, the freighting or hireing out ships, depends on the money, and the other branches of trade. where ships are in use to be freighted by strangers, and supported by a great demand for their own trade; there all sorts of ships are to be hired cheaper than in other places; and merchants are sure of such ships as are proper for the goods they load with, and the countries they trade to.

This trade of freighting brings the goods of other countries to Holland, tho’ design’d for sale elsewhere. if woollen manufacture from England to Portugal yields 25 per cent profit, and to Holland 15; the English merchant will choose to fend such goods to Holland for 15 per cent, rather than to Portugal for 25; and the Dutch merchant who is able to trade cheaper, from the cheapness of freight, etc. is satisfied for the other 10 to carry to Portugal.

Most authors who have wrote on trade divide it into national and private. they say, a merchant may gain where the nation loses. if a 1000 lib. is exported to the Indies in money or bullion, and a 1000 lib. in goods or provisions; the return worth 8000 lib. the merchant gains 6000; but as these goods are all consumed in the country, the nation loses the 1000 lib. money or bullion exported.

They don’t consider whether the 8000 lib. of goods imported (all supposed to be consum’d in the country) does not lessen the consumption of the product or manufacture of the country, so as to occasion an addition to the export, at least equal to the 1000 lib. money or bullion exported. but allowing they do not lessen the consumption of the goods of the country, and the use of them be not at all necessary; yet these goods being worth 8000 lib. at home or abroad, the nation gains 6000. if the people consume them, and in extravagant uses, that’s not the fault of the trade, nor for that reason should that trade be call’d disadvantageous; it is the fault of the government, who ought to hinder the too great consumption of foreign goods; especially, such as might be wanted without causing a greater consumption of the goods of the country, that care being taken, by making the vent less profitable at home, than abroad; merchants would export them, or for the future lessen the import.

If East-India goods that sell for a 1000 lib. in England, are only worth abroad 800 lib, the duty payed at their entry being return’d, and more given as a draw-back to encourage the export, their vent abroad will be more profitable than in England.

A people may consume more of their own or foreign goods, than the value of the product, manufacture, and profits by trade; but their trade is not disadvantageous, it is their too great consumption: and the too great consumption of the product and manufacture of the country, may be as hurtful as that of foreign goods; for, if so much is consumed, that the remainder exported won’t pay the consumption of foreign goods, a ballance will be due, and that ballance will be sent out in money or bullion.

A nation may gain where the merchant loses, but wherever the merchant gains, the nation gains equal, and so much more, as the maintenance and wages of the people employ’d and the duty on the goods amounts to. if a ship insur’d is lost, the nation loses, and the merchant loses nothing; but in that case the insurer is the merchant, and loses equal to the nation.

As trade depends on money, so the encrease or decrease of the people depends on trade. if they have employment at home, they are kept at home: and if the trade is greater than serves to employ the people, it brings more from places where they are not employ’d. Sir William Petty values a man at 20 years purchase, by that computation a seaman whose wages is forty shil. a month, is valued 480 lib.