The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn / Intended as an appendix to "Observations on the corn laws"

by T. R. Malthus

If we consider, with what an increased weight the taxes on tea, sugar, malt, leather, soap, candles, etc., etc. would in this case bear on the labouring classes of society, and what proportion of their incomes all the active, industrious middle orders of the state, as well as the higher orders, must pay in assessed taxes, and the various articles of the customs and excise, the pressure will appear to be absolutely intolerable. Nor would even the ad valorem taxes afford any real relief. The annual fourty millions, must at all events be paid; and if some taxes fail, others must be imposed that will be more productive.

These are considerations sufficient to alarm even the stockholders themselves, indeed, if the measure of value were really to fall, as we have supposed, there is great reason to fear that the country would be absolutely unable to continue the payment of the present interest of the national debt.

I certainly do not think, that by opening our ports to the freest admission of foreign corn, we shall lower the price to fifty shillings a quarter. I have already given my reasons for believing that the fluctuations which in the present state of Europe, a system of importation would bring with it, would be often producing dear years, and throwing us back again upon our internal resources. But still there is no doubt whatever, that a free influx of foreign grain would in all commonly favourable seasons very much lower its price.

Let us suppose it lowered to sixty shillings a quarter, which for periods of three or four years together is not improbable. The difference between a measure of value at 60 compared with 80 (the price at which it is proposed to fix the importation), is 33 1/3 per cent. This percentage upon 40 millions amounts to a very formidable sum. But let us suppose that corn does not effectually regulate the prices of other commodities; and, making allowances on this account, let us take only 25, or even 20 per cent. Twenty per cent. upon 40 millions amounts at once to 8 millions—a sum which ought to go a considerable way towards a peace establishment; but which, in the present case, must go to pay the additional interest of the national debt, occasioned by the change in the measure of value. And even if the price of corn be kept up by restrictions to 80 shillings a quarter, it is certain that the whole of the loans made during the war just terminated, will on an average, be paid at an interest very much higher than they were contracted for; which increased interest can, of course, only be furnished by the industrious classes of society.

I own it appears to me that the necessary effect of a change in the measure of value on the weight of a large national debt is alone sufficient to make the question fundamentally different from that of a simple question about a free or restricted trade; and, that to consider it merely in this light, and to draw our conclusions accordingly, is to expect the same results from premises which have essentially changed their nature. From this review of the manner in which the different classes of society will be affected by the opening of our ports, I think it appears clearly, that very much the largest mass of the people, and particularly of the industrious orders of the state, will be more injured than benefited by the measure.

I have now stated the grounds on which it appears to me to be wise and politic, in the actual circumstances of the country, to restrain the free importation of foreign corn.

To put some stop to the progressive loss of agricultural capital, which is now taking place, and which it will be by no means easy to recover, it might be advisable to pass a temporary act of restriction, whatever may be the intention of the legislature in future. But, certainly it is much to be wished that as soon as possible, consistently with due deliberation, the permanent policy intended to be adopted with regard to the trade in corn should be finally settled. Already, in the course of little more than a century, three distinct changes in this policy have taken place. The act of William, which gave the bounty, combined with the prohibitory act of Charles II was founded obviously and strikingly upon the principle of encouraging exportation and discouraging importation; the spirit of the regulations adopted in 1773, and acted upon some time before, was nearly the reverse, and encouraged importation and discouraged exportation. Subsequently, as if alarmed at the dependence of the country upon foreign corn, and the fluctuations of price which it had occasioned, the legislature in a feeble act of 1791, and rather a more effective one in 1804, returned again to the policy of restrictions. And if the act of 1804 be left now unaltered, it may be fairly said that a fourth change has taken place; as it is quite certain that, to proceed consistently upon a restrictive system, fresh regulations become absolutely necessary to keep pace with the progressive fall in the value of currency.

Such changes in the spirit of our legislative enactments are much to be deprecated; and with a view to a greater degree of steadiness in future, it is quite necessary that we should be so fully prepared for the consequences which belong to each system, as not to have our determinations shaken by them, when they occur.

If, upon mature deliberation, we determine to open our ports to the free admission of foreign grain, we must not be disturbed at the depressed state, and diminished produce of our home cultivation; we must not be disturbed at our becoming more and more dependent upon other nations for the main support of our population; we must not be disturbed at the greatly increased pressure of the national debt upon the national industry; and we must not be disturbed at the fluctuations of price, occasioned by the very variable supplies, which we shall necessarily receive from France, in the actual state of her laws, or by the difficulty and expense of procuring large, and sudden imports from the Baltic, when our wants are pressing. These consequences may all be distinctly foreseen. Upon all general principles, they belong to the opening of our ports, in the actual state and relations of this country to the other countries of Europe; and though they may be counterbalanced or more than counterbalanced, by other advantages, they cannot, in the nature of things, be avoided.

On the other hand, if, on mature deliberation, we determine steadily to pursue a system of restrictions with regard to the trade in corn, we must not be disturbed at a progressive rise in the price of grain; we must not be disturbed at the necessity of altering, at certain intervals, our restrictive laws according to the state of the currency, and the value of the precious metals; we must not be disturbed at the progressive diminution of fixed incomes; and we must not be disturbed at the occasional loss or diminution of a continental market for some of our least peculiar manufactures, owing to the high price of our labour.(17*) All these disadvantages may be distinctly foreseen. According to all general principles they strictly belong to the system adopted; and, though they may be counterbalanced, and more than counterbalanced, by other greater advantages, they cannot, in the nature of things, be avoided, if we continue to increase in wealth and population.