The Economist, Volume 1, No. 3

by Various

Sir,—I have read your preliminary number and prospectus, and the first number of your new periodical, the Economist, and it gives me pleasure to see the appearance of so able an advocate of free trade, the carrying out the principles of which is so necessary for the future welfare and prosperity of the country, and the relief of the distress which is more or less felt in all the different departments of industry.

I belong to the class who have their sole dependence in the land, and have no direct interest in trade or manufactures; and feel as strong a wish for the prosperity of agriculture as the Duke of Buckingham, or any other of the farmer's friends; but I consider the interests of all classes of the community so intimately connected, and so mutually dependent on one another, that no one can rise or prosper upon the ruins of the others. Like your Northumberland correspondent I am fully convinced of the impolicy and inefficiency of "restrictive corn laws," and of the benefit of "the free-trade system" for the relief of the agricultural, as well as of the manufacturing, the shipping, or any other interest in the country; and I should also be glad if I could in any way assist "in dispelling the errors respecting the corn trade that have done so much harm for the last twenty (eight) years."

The intention of the corn law of 1815 was to prevent the price of wheat from falling below 80s. per quarter; and it was the opinion of farmers who were examined on the subject, that less than 80s. or 90s. would not remunerate the grower, and that if the price fell under these rates, the wheat soils would be thrown out of cultivation. Prices, however, fell, and though they have fallen to one half, land has not been thrown out of cultivation. Various modifications have since been made in the scale of duties, but always with a view to arrest the falling prices in their downward course; but all these legislative attempts have been in vain; and so far as the farmer trusted to them, they have only misled him by holding out expectations that have not been realized.

But though the corn laws failed in keeping up the price of corn as high as their framers and supporters wished, they succeeded so far as to enhance the price of this first necessary of life, and make it perhaps 20 or 30 per cent. dearer than it otherwise would have been to all the consumers, even the poorest tradesman or labourer in the country.

If the difference which the agriculturists were enabled, by this monopoly, to obtain at the expense of the other classes, had all been pure gain, without any drawback, they must have been in a comparatively flourishing condition; but we find this is not the case, and what is the reason? Let us hear Sir Robert Peel's answer to the question. In his speech in parliament on Mr Villiers's motion, when replying to the accusations that had been made by Mr Blackstone and other members on his own side of the house, that he had deceived the agriculturists, as the Government measures, instead of affording them the protection that was promised, had brought down prices and rendered their situation worse than before, Sir Robert says, it was not the Government measures that had brought down prices and occasioned the agricultural distress, but that this arose from the condition of the manufacturing districts, and the general distress from bad trade and want of employment, which rendered the people unable to consume.

If this, then, is the true cause of the agricultural distress,—if the corn, sugar, and other monopolies are so injurious to the manufacturing and commercial classes, who are the agriculturists' best, and, indeed, their only customers, as to render them unable to consume, it is not to class legislation that we can look for relief. In order to relieve the agricultural distress there is no other way than to relieve the distress of those on whom they depend for a market for their productions.

Were the farmer (or rather the landed proprietor) to gain all that the consumer loses by the corn monopoly,—if it were only taking from one, and giving to another—without any national loss; though this of itself would be bad enough,—it is perhaps the smallest part of the loss which the manufacturer sustains; for the same law which hinders him from going to the best and cheapest market to purchase his food, at the same time necessarily excludes him from a market for the produce of his industry; and by diminishing the demand for his labour, lowers his wages or throws him out of employment.

But one abuse leads to another. Those who are interested in the corn monopoly, or think themselves so, cannot well oppose the sugar monopoly while they require the aid of the West India planters to enable them to obtain this advantage at their country's expense; and so it is with all the other monopolists, they naturally unite together, and it requires their mutual aid and all their combined power and influence to preserve a system which they know stands upon rather an insecure foundation, and if once broken in upon would soon fall to pieces; and thus it is that we are subjected to the sugar monopoly, and though it is manifestly our interest to buy this important necessary of life (as well as every other) in any quarter of the globe where we can find it best and cheapest, we are restricted to a small portion of the earth's surface, and have to pay a third part more than we might obtain the article for without any loss to the revenue. By this narrow-minded system of buying, we deprive ourselves of valuable markets for our manufactures, as you have shown is likely to be the case with the Brazils on the expiry of the commercial treaty with that country if the matter is left in the hands of Ministers, "and no effort made to avert so great an evil." The agriculturists have to pay directly for this monopoly in common with all the other classes in the addition to the price of the sugar they consume; but the manufacturers suffer the still greater disadvantage of having the market for the produce of their labour narrowed, and thus the agriculturist will also suffer indirectly by their customers being thereby still farther disabled to consume.

But these and all other monopolies and restrictions in trade not only lessen the demand for our manufactures abroad, but they diminish the consumption at home, to an extent greater perhaps than we are aware of; for there can be no doubt that the more the consumer has to pay for his bread, sugar, and other articles of food, the less he will have to spare for cottons, woollens, and other manufactured commodities. The demand for his labour is thus lessened both at home and abroad. The weaver of cloth may be unable to obtain a coat even of his own manufacture, however necessary it may be for his health and comfort; he must have food, in the first place, being more indispensibly necessary to his existence,—no doubt he may have to content himself with a less quantity than he could have wished, and have to substitute oatmeal and potatoes, or some other inferior food for wheaten bread and butchers meat; still, it is less in his power to curtail the consumption of agricultural produce than of manufactures, so that the manufacturing classes suffer from the general distress which renders the people unable to consume in a greater degree than the agriculturist.

R.T.F.