Front Page Titles (by Subject) SECTION II.: Of Colonies, in the conception of which, the idea of Territory is the predominating Idea. - Colony
The Online Library of Liberty
A project of Liberty Fund, Inc.
SECTION II.: Of Colonies, in the conception of which, the idea of Territory is the predominating Idea. - James Mill, Colony 
Supplement to the Encyclopedia Britannica (London: J. Innes, 1825).
About Liberty Fund:
Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.
The text is in the public domain.
Fair use statement:
This material is put online to further the educational goals of Liberty Fund, Inc. Unless otherwise stated in the Copyright Information section above, this material may be used freely for educational and academic purposes. It may not be used in any way for profit.
Of Colonies, in the conception of which, the idea of Territory is the predominating Idea.
Of this sort are most of the colonies of the states of modern Europe; the British possessions, for example, in the East and West Indies.
The question is, in what way or ways, abstracting from the questions of population, an outlying territory, considered merely as territory, is calculated to be advantageous; or, in other words, what reasons can any country have for desiring to possess the government of such territories.
There are two ways, which will easily present themselves to every mind, as ways in which advantage may accrue to the governing country. First, these outlying dominions may yield a tribute to the mother country; secondly, they may yield an advantageous trade.
Where Tribute to the Mother Country is the Benefit she proposes.
This will not require many words, as few persons are much in error on the subject. In regard to the West Indies, no such idea as that of a tribute has ever been entertained. Even in regard to those taxes, which a vain and unprofitable attempt was made to impose upon the formerly existing colonies in North America, they were never dreamt of as a tribute, and never spoken of but in a sense contrary to the very idea of a tribute, that of reimbursing to the mother country a part, and no more than a part, of that which they cost her in governing and defending them.
With regard to the East Indies, we believe, there exists more or less of prejudice. Under the ignorance in which Englishmen have remained of East India affairs, it floats in the minds of a great many persons, that, some how or other, a tribute, or what is equivalent to a tribute, does come from the East Indies. Never did an opinion exist, more completely without evidence, contrary to evidence, evidence notorious, and well-known to the persons themselves, by whom the belief is entertained. India, instead of yielding a tribute to England, has never yielded enough for the expence of its own government. What is the proof? That its government has always been in debt; and has been under the necessity of continually augmenting its debt, till it has arrived at a magnitude which it has often itself described as alarming.
So far is India from yielding a tribute to Great Britain, that, in loans and aids, and the expence of fleets and armies, it has cost this country enormous sums. It is no doubt true, that some acts of Parliament have assumed the existence of a tribute from India, or what has been called a surplus revenue, for the use of the nation. But Parliament, we have pretty good experience, cannot make things by affirming them. Things are a little more stubborn than the credulity of Englishmen. That, in general, is obedient enough to the affirmations of those who lead the Parliament, and who have sometimes an interest in leading it wrong. Facts take their own course, without regard to the affirmations of Parliament, or the plastic faith of those who follow them.
A general proposition on this subject, may be safely advanced. We may affirm it, as a deduction from the experienced laws of human society, that there is, if not an absolute, at least, a moral impossibility, that a colony should ever benefit the mother country, by yielding it a permanent tribute.
Let any body but consider what is included in the word government; and when he has done that, let him then tell himself, that the colonies must be governed. If he has the sufficient degree of knowledge and reflection, no further proof will be necessary.
No proposition in regard to government is more universal, more free from all exception than this, that a government always spends as much as it finds it possible or safe to extract from the people. It would not suit the limits of the present design, to run over the different governments of the world, for the experimental proof of this proposition. We must invite every reader to do it for himself. Of one thing we are perfectly sure, that the more profoundly he is read in history, the more thoroughly will he be convinced of the universality of the fact.
Now, then, consider whether this universal fact be not inconsistent with the idea of a tribute from a colony. The government of the mother country itself cannot keep its expences within bounds. It takes from the people all it can possibly take, and is still going beyond its resources. But if such is the course of government at home, things must be worse in the colonies. The farther servants are removed from the eye of the master, the worse, generally speaking, their conduct will be. The government of the colonies, managed by delegates from home, is sure to be worse, in all respects, than the government at home; and, as expence is one of the shapes in which the badness of government is most prone to manifest itself, it is sure, above all things, to be in proportion to its resources more expensive. Whatever springs operate at home to restrain the badness of government, cannot fail to operate with diminished force, at the distance of a colony. The conclusion is irresistible. If the government of the mother country is sure to spend up to the resources of the country; and if a still stronger necessity operates upon the government of the colony to produce this effect, how can it possibly afford any tribute?
If it be objected to this conclusion, that this propensity of governments to spend may be corrected, we answer, that this is not the present question. Take governments as, with hardly any exception, they have always been, (this is a pretty wide experience;) and the effect is certain. There is one way, to be sure, of preventing the great evil, and preventing it thoroughly. But there is only one. In the constitution of the government, make the interest of the many to have the ascendency over the interest of the few, and the expence of government will not be large. The services expected from government may, generally speaking, be all rendered in the best possible manner, at very little expense. Whenever the interests of the many are made, in the framing of governments, to have the ascendency over the interests of the few, the services of government will always be rendered at the smallest possible expence. So long as the interests of the few are made to have the ascendency over the interests of the many, the services of government are all sure to be rendered at the greatest possible expence. In almost all governments that ever yet existed, the interest of the few has had an ascendency over the interests of the many. In all, the expence of government has, accordingly, been always as great, as, in existing circumstances, the people could be made, or could be made with safety, to give the means of making it.
One other supposition may be urged in favour of the tribute. The expence, it may be said, of governing the colony by a deputation from the mother country, may be escaped, by allowing the colony to govern itself. In that case, the colony will not choose to pay a tribute. If the tribute rests upon the ground of friendship, it will not be lasting. If the mother country extorts it by force, the colony is, in fact, governed by the mother country; and all the expence of that mode of government is ensured. If it be urged that the colony may continue to pay a tribute to the mother country, and that voluntarily, because the mother country may be of use to it; that, we may answer, is a bargain, not a tribute. The mother country, for example, may yield a certain portion of defence. But the colony is saved from the expense of providing for itself that defence which it receives from the mother country, and makes a good bargain if it gets it from the mother country cheaper than it could be provided by itself. In this case, too, the expence incurred by the mother country is apt to be a very full equivalent for the tribute received. It is evident, that this sort of bargain may subsist between any two states whose circumstances it may suit, and is not confined to a mother and daughter country. It is, therefore, no part of the question relating to colonies.
Where profits of Trade are the advantage sought by the Mother Country.
We have now investigated the first of the modes in which a colony, considered as territory merely, may be expected to benefit the mother country; and we have seen the chances of good which it affords. The second of these modes, viz. the trade, by means of which it is supposed that colonies may benefit the mother country, is a topic of some importance; for it is on account of the trade, that colonies have remained an object of affection to Englishmen. It is on account of trade, solely, that the colonies in the West Indies are valued; and though an idea of something like a tribute from the East Indies has till this time maintained a place in the minds of the unthinking part of the community, still it is the trade which has been supposed to be the principal source of the advantage which has been ascribed to what we call “the British Empire in the East.”
In the idea of deriving a peculiar advantage from the trade of the colonies, is necessarily included the idea of monopoly. If the trade of the colony were free, other nations would derive as much advantage from it as the mother country; and the mother country would derive as much advantage from it, if the colony were not a colony.
Dr. Smith affirms that this monopoly can never be of any advantage; must always, on the contrary, be a source of great disadvantage to the mother country.
If the trade of the colony is left open to all the merchants of the mother country, it will no doubt happen, that the competition of these merchants, one with another, will make them sell as cheap in the colony as they can afford to sell, that is, buy as dear as they can afford to buy. The produce of the colony will, in that case, go as cheap to the foreign as to the home consumer.
There is another case; namely, that in which the trade of the colony is placed in the hands of an exclusive company. In that case it is true, that the mother country may obtain a given quantity of the goods of the colony for a less quantity of her own than otherwise she would do. The goods of the mother country are, in that case, placed, with regard to the goods of the colony, in the situation in which those commodities which can only be produced in a limited quantity, particular wines, for example, which can only be produced on one particular spot, are placed with regard to all the rest of the goods in the world. It is evident that any quantity of the rest of the goods in the world may be given for those wines, if people are sufficiently desirous to possess them; that there is no limit, in short, to that quantity, but the unwillingness of people to part with more of the things which they possess, to obtain the commodities which are thus in request. The same would be the case with a colony, the trade of which was entirely in the hands of an exclusive company. The exclusive company, by limiting the quantity of the goods of the mother country which they chose to send to the colony, might compel the colonists to give for that limited quantity any quantity of the produce of their own land and labour, which their desire to obtain the goods of the mother country would admit. If the goods of the mother country were goods which excited a very strong desire, if they were goods of the first necessity, the necessary materials of food or the instruments of their industry, there would be no limit but one to the greatness of the quantity of their own produce, which they might be compelled to pay for a given quantity of the produce of the mother country. When nothing was left to the colony of the whole produce of its labour, but just enough to keep the labourers alive, it could not go any farther. Up to that point, if dependent for articles of the first necessity, it might, by an exclusive company, undoubtedly be stript.
Even where the monopoly is not confined to an exclusive company, but extended to all the merchants of the mother country, she might still, in one supposeable case, draw an ordinary advantage from the trade of the colony.
The facts would be these. Whatever foreign goods the colony bought, she would still be obliged to purchase from the mother country. No doubt, the competition of the merchants of the mother country would, in this case, compel them to sell as cheap to the colony as to any other country. Wherein, then, would consist the advantage? In this, that England might thus sell in the colony, with the usual profits of stock, certain kinds of goods, which not being able to manufacture so cheaply as some other countries, she would cease to manufacture, except for the monopoly. But still a very natural question arises:—What advantage does she derive from forcing this manufacture, since she makes by it no more than the ordinary profits of stock, and might make the ordinary profits of stock by the same capital in some other employment? The answer is, that she might, by this means, obtain a greater quantity of the goods of the colony, by a given quantity of the produce of her own labour, or what comes to the same thing, an equal quantity of the goods of the colony, by a less quantity of the produce of her own labour, than she could in a case of freedom.
It may be seen to be so in this manner. England desires to purchase, say 10,000 hogsheads of sugar. This is her consumption. For this she will give, of the produce of her own labour, whatever quantity it is necessary to give. She wishes, however, to give as little as possible; and the question is, in what way she may give the least. The sugar is worth, say £500,000. England sends goods to the colony which sell for £500,000. Now, apply the supposition introduced above. Suppose that, if trade were free, these goods from England, which the manufacturers and merchants of England cannot afford to sell for less than £500,000, could be had for £400,000, from some other country. In that case it is evident that the same quantity of these same goods with which England, under the monopoly, purchased 10,000 hogsheads of sugar, would now purchase only 8000; for that is the ratio of the £400,000 to the £500,000. What, then, would happen, supposing England still to resolve upon having 10,000 hogsheads of sugar? One of two things must of necessity happen. Either she will purchase the sugar with the same goods, or she will not. If she purchases it with the same goods, it is evident that she must give a greater quantity of goods; she must give one fifth more of the produce of her labour; one fifth more of her industrious people must be withdrawn from administering to other productions, and employed in enabling her to obtain the same quantity of sugar. This quantity of produce, in that case, the mother country saves, by means of the monopolized trade of the colony. This quantity she loses, by losing such a colony. But, undoubtedly the mother country would, in such a case, endeavour to purchase the sugar, not with such goods as she purchased it with before, but other goods. She would endeavour to punchase it with goods which she could manufacture as cheaply as any other country. But supposing the colony had no demand for any goods which the mother country could afford as cheap as any other country; even in that case the mother country would still have a resource. If there was any country in which she could sell such goods for money, she could purchase the same quantity of sugar, for the same quantity of the produce of her own labour as before.
It is not then true, according to Dr. Smith, that in no case can the mother country derive any peculiar advantage in the way of trade, from the possession of colonies. We see that there are two cases, in which she may derive an advantage in that way. It remains to inquire what that advantage is ultimately worth; not only what it is in itself independently, but what it is, after compensation is made for all the disadvantages with which the attainment of it is naturally attended.
We are first to enquire what is the value of that advantage, all deductions made, which the mother country may derive, through an exclusive company, from the trade of a colony?
It is very evident, in the first place, that, whatever the mother country gains, the colony loses. Now, if the colony were part of the dominions of a foreign state, there is a certain way of viewing such questions, in which that result would appear to be perfectly desirable. But, suppose that the colony, which is the fact, is not part of the dominions of a foreign state, but of the same state; that it is, in truth, not part of a different country, but of the same country; its subjects not part of a different community, but of the same community; its poverty or riches, not the poverty or riches of another country, but of the same country. How is the result to be viewed in that case? Is it not exactly the same sort of policy, as if Yorkshire were to be drained and oppressed for the benefit of Middlesex? What difference does it make, that one of the portions of the same empire is somewhat farther off than another? Would it, for that reason, be more rational to pillage Caithness, than to pillage Yorkshire, for the sake of Middlesex? Does the wealth of a state consist in the wealth of one part, effected by the misery of another? What opinion must we form of such a rule for guiding the policy of state? Assuredly, this would be a contrivance, not for increasing her wealth and happiness upon the whole. It would be a contrivance for diminishing it. In the first place, when, from one of two parties, equally provided with the means of enjoyment, you take a portion to give it to the other, the fact is,—a fact too well established, and too consonant with the experience of every man, to need illustration here,—that you do not add to the happiness of the one, so much as you take from the happiness of the other; and that you diminish the sum of happiness of the two taken together. This, in truth, is the foundation, upon which the laws for the protection of property rest. As the happiness of one man is, or ought to be, of no more value to the state, than the happiness of another man, if the man who takes from another man a part of his property, added to his own happiness, as much as he took from the happiness of the other, there would be no loss of happiness upon the whole, and the state would have no ground, in utility, on which to interfere.
But this is not all: not only is the quantity of happiness diminished upon the whole, but by that operation which gives the mother country an advantage by the trade of the colony, the quantity of produce of the community is diminished upon the whole. The subjects of the state, taken as a whole, not only enjoy less than they would otherwise enjoy, but they produce less than they would otherwise produce. The state is not a richer state; it is, on the contrary, a poorer state, by means of such a colonial policy.
By means of such a policy, a portion of the capital of the state is employed in a channel in which it is less productive than it would have been in the channel into which it would have gone of its own accord. It is a point established in the science of Political Economy, that it is not good policy to confine consumption to any sort of home manufacture, when it can be purchased more cheaply abroad. It is upon this ground that we have laughed at the late and present outcries of the Germans, because the English sell their goods cheaper than they can make them. The reason is, because when a country continues to consume an article made at home, which it could get cheaper from another country, it does neither more nor less than insist, that it shall employ a certain number of men’s labour in providing it with that article, more than it would be necessary to employ if it imported the article; and, of course, it loses completely the benefit of these men’s labour, who would otherwise be employed in producing for it something else. The country is, therefore, the poorer, by the whole value of these men’s labour. The case is exactly the same, where the colonies are confined to the manufactures of the mother country. When the colony is obliged to employ, for the purpose of obtaining a certain quantity of goods from the mother country, the labour of a greater number of men than she would be obliged to employ to get the same quantity of goods from another country, she loses the labour of all that additional number of men. At the same time, the mother country does not gain it; for if the mother country did not manufacture for the colony, her capital would be liberated to another employment, and would yield the same profits in that as it did in the former employment.
We have still, however, to examine that extraordinary case which we before supposed, in which the mother country cannot produce any sort of commodity whatsoever as cheap as other countries; and, if trade were free, of course would sell nothing in a foreign market. The case here is somewhat altered. In liberating the colony from the monopoly of the mother country, there would be no change of capital from a less to a more productive employment; because, by the supposition, the mother country has not a more productive employment to which her liberated capital can be sent. Events would succeed in the following order. The colony would obtain the goods which it demanded, with a smaller portion of its own labour, would hence be more amply supplied with goods. But it is not supposed that this event would give to its industry a more beneficial direction. In the case of a sugar colony, at any rate, its industry would remain in the same channels as before. Such would be the effects in regard to the colony. What would they be in regard to the mother country? If her capital is no longer employed in manufacturing for the colony, she can always, indeed, employ it with the same profit as before. But she still desires the same quantity of sugar; and her goods will not go so far as before in the purchase of it. Whatever fall would be necessary in the price of her goods to bring them upon a level with the goods of other countries, is equivalent, as far as she is concerned, to a rise of the same amount, in the price of sugar. In this case, the mother country would lose exactly as much as the colony would gain. The community, taken as a whole, would be neither the richer nor the poorer, for driving things out of the free, into the compulsory channel. The people of the mother country would be so much the richer, the people of the colony would be so much the poorer.
This, however, still remains to be said. There is only one case in which this sort of monopoly would not diminish the produce of the community, and render it positively poorer upon the whole. There is only that one case, supposed above, in which the mother country has not one commodity which she can sell as cheap as other countries. Now this may fairly be regarded as a case, if not altogether, at any rate, very nearly impossible. It is not easy to conceive a country so situated, as not to have advantages in regard to the production of some sorts of commodities, which set her on a level with other countries. As long as this is the case, she can obtain money on as good terms as any other country; and if she can obtain money on as good terms, she can obtain sugar, and every thing else.
The question, then, as to the benefit capable of being derived from a colony through the medium of an exclusive trade, is now brought to a short issue. There is no benefit, except through the medium of a monopoly. There is only one case in which the monopoly does not make the whole community poorer than it would otherwise be. In that case, it does not make the community richer than it would otherwise be; and that case is one, which can either never be realized, or so rarely, as to be one of the rarest of all exceptions to one of the most constant of all general rules. The policy of holding a colony for the benefit of its trade, is, therefore, a bad policy.
To these conclusions, one or two of the doctrines of Dr. Smith will be seen to be opposed, and, therefore, require a few words of elucidation.
If an advantage, in the two cases just explained, would arise from colonies, it would be counterbalanced, he says, by the disadvantage attending the rise in the profits of stock.
Both parts of this doctrine may be disputed. In the first place, it may be disputed, whether the monopoly of the colony trade has any tendency to raise the profits of stock in the mother country. In the next place, it may be disputed, whether a high rate of profits in any country, has any tendency to lay it under any disadvantage in its traffic with other nations.
First, it may be disputed, whether the monopoly of the colony trade would increase the profits. The expulsion of foreign capital would create a vacuum, whence, according to Smith, a rise of profit, and an absorption of capital from the mother country. The question is, whether capital would not flow into the colonies from the mother country, till it reduced the profits in the colony, to the level of the profits in the mother country, instead of raising those in the mother country, in any degree toward a level with those of the colony. That it would do so, appears to be capable of demonstration. Mr. Ricardo’s argument would be very short. Nothing, he would say, can raise the profits of stock, but that which lowers the wages of labour. Nothing can lower the wages of labour, but that which lowers the necessaries of the labourer. But nobody will pretend to say, that there is any thing in the monopoly of the colony trade, which has any tendency to lower the price of the necessaries of the labourer. It is, therefore, impossible that the monopoly of the colony trade can raise the profits of stock. By those who are acquainted with the profound reasonings of Mr. Ricardo, in proof of the two premises, this argument will be seen to be complete. There is not a demonstration in Euclid, in which the links are more indissoluble. To those who are not acquainted with those reasonings, we are aware that the propositions will appear mysterious; and yet, we are afraid that, in the few words to which we are confined, it will not be possible to give them much satisfaction.
With regard to the last of the two propositions, that nothing can lower the wages of labour, but that which lowers the necessaries of the labourer, we may confine ourselves to that combination of circumstances which marks the habitual state, without adverting to the modifications exemplified in those states of circumstances which are to be regarded as exceptions. The habitual state of population is such, that wages are at the lowest terms; and cannot be reduced lower without checking population, that is, reducing the number of labourers. In this case, it is self-evident, that nothing can lower the wages of labour, but lowering the necessaries of the labourer. In all, then, except the extraordinary cases, which it would require too many words here to explain, in which a country is but partially peopled, and in which part of the best land is still unemployed, the proposition of Mr. Ricardo is indisputable, that nothing can lower the wages of labour, except a fall in the necessaries of the labourer.
Let us next consider the proposition, That nothing can raise the profits of stock but that which lowers the wages of labour.
One thing is perfectly clear, that if the whole of what is produced by the joint operations of capital and labour, were, whatever it is, divided, without deduction, between the owner of the stock, and the labourers whom it employs, in that case, whatever raised the wages of labour, would lower profits of stock, and profits of stock could never rise, except in proportion as wages of labour fell. The whole being divided between the two parties, in whatever proportion the one received more, it is certain that the other would receive less.
But what is here put in the way of supposition, viz. that the whole of what is produced by the joint operations of capital and labour, is divided between the capitalists and the labourers, is literally and rigidly the fact. It is, then, undeniable, that nothing can raise the profits of stock, but that which lowers the wages of labour.
The whole produce, without any exception, of every country, is divided into three portions, rent, wages, and profits. If there were no rent, and the whole were divided into profits and wages, the case would be clear; because nothing could be added to the one without being detracted from the other.
Rent, however, does, in reality, make no difference. Rent is no part of the joint produce of labour and capital. It is the produce, exclusively, of a particular degree of fertility in particular lands; and is yielded over and above a return to the whole of the labour and capital employed upon that land, over and above a return equal to the joint produce of an equal portion of labour and capital in any other employment.
So much, then, for Dr. Smith’s opinion, that the monopoly of the colonial trade raises the profits of stock. Let us next inquire if it be true, that a rise in the profits of stock, if it were produced by the monopoly, would occasion, as he supposes, any discouragement to the foreign trade of the mother country.
It would occasion this discouragement, he says, by raising prices. If, then, it can be shown, that it would certainly not raise prices, every reason for supposing that it would afford any discouragement to foreign trade is taken away. But that a high rate of profits does not, and cannot raise prices, is evident from what has been deduced above. The whole produce of the joint operations of labour and capital being divided between profits and wages, in whatever degree profits rise, wages fall; the cost of production remains the same as before.
Not only does a variation in the state of wages and profits give no obstruction to foreign trade, a variation even in the cost of production gives no obstruction. A nation exports to another country, not because it can make cheaper than another country; for it may continue to export, though it can make nothing cheaper. It exports, because it can, by that means, get something cheaper from another country, than it can make it at home. But how can it, in that case, get it cheaper than it can make it at home? By exchanging for it something which costs it less labour than making it at home would cost it. No matter how much of that commodity it is necessary to give in exchange. So long as what it does give is produced by less labour, than the commodity which it gets for it could be produced by at home, it is the interest of the country to export. Suppose that the same quantity of corn which is produced in England by the labour of 100 men, England can purchase in Poland with a quantity of cotton goods which she has produced with the labour of 90 men; it is evident that England is benefited by importing the corn and exporting the cotton goods, whatever may be the price of the cotton goods in Poland, or the cost of producing them. Suppose that the cotton goods could be produced in Poland with the labour of 85 men, that is, less than they are supposed to be produced with in England. Even that would not hinder the trade between them. Suppose that the same quantity of corn, which is raised in England with the labour of 100 men, is raised in Poland with the labour of 80; in that case, it is plain, that Poland can get with 80 men’s labour, through the medium of her corn, the same quantity of cotton goods which would cost her the labour of 85 men, if she was to make them at home. Both nations, therefore, profit by this transaction; England, to the extent of 10 men’s labour, Poland to the extent of 5 men’s labour; and the transaction, in a state of freedom, will be sure to take place between them, though England is less favourably situated than Poland with regard to both articles of production.
In what manner this class of transactions is affected by the intervention of the precious metals; in what manner the precious metals distribute themselves, so as to leave the motives to this barter exactly the same as they would be, if no precious metal intervened, it would require too many words here to explain. The reader who recurs for that explanation to Mr. Ricardo, the first author of it, will not lose his time or his pains.
One other disadvantage of the colony trade is adduced by Dr. Smith. It turns the capital of the country out of a more, into a less profitable employment, by turning it from the home to a foreign trade, from a foreign of quick, to a foreign of slow returns, and from a foreign to a carrying trade. This doctrine, too, requires some explanation, and more, to be sufficiently clear, than can here be bestowed upon it. The home trade is not necessarily more advantageous than the foreign, nor the foreign of quick, than the foreign of slow returns, nor any of them all than the carrying trade. These trades, it may be allowed, increase the gross produce of a country, in the order in which Dr. Smith has arranged them. But a country is happy and powerful, not in proportion to its gross, but in proportion to its net revenue; not in proportion to what it consumes for the sake of production, but to what it has over and above the cost of production. This is an important fact, which, in almost all his reasonings Dr. Smith has overlooked. It will hardly, however, be denied, that in various circumstances, any one of these trades, the carrying trade itself, may be more conducive to a net revenue, than any of the rest; and in a state of freedom will be sure to be so, as often as the interest of individuals draws into that channel any portion of the national stock.
We have now, therefore, considered all those cases which, in the study of colonial policy, can be regarded in the light of species or classes. There are one or two singular cases, which are of sufficient importance to require a separate mention.
Where Maritime Strength is the Object sought by the Mother Country.
That English law, which established the monopoly of the colonies, at least of the transatlantic ones, professes to have in view, not trade so much as defence. The reason of that round-about policy is in this manner deduced. The defence of England stands very much upon her navy; her navy depends altogether upon her sailors; the colony trade and its monopoly breed sailors; therefore, colonies ought to be cultivated, and their trade monopolized.
Upon the strength of this reasoning, in which, for a long time, it would have appeared to be little less than impiety to have discovered a flaw, the navigation laws, as they are called, were embraced, with a passionate fondness, by Englishmen.
Nothing is worthy of more attention, in tracing the causes of political evil, than the facility with which mankind are governed by their fears; and the degree of constancy with which, under the influence of that passion, they are governed wrong. The fear of Englishmen to see an enemy in their country has made them do an infinite number of things, which had a much greater tendency to bring enemies into their country than to keep them away.
In nothing, perhaps, have the fears of communities done them so much mischief, as in the taking of securities against enemies. When sufficiently frightened, bad governments found little difficulty in persuading them, that they never could have securities enough. Hence come large standing armies; enormous military establishments; and all the evils which follow in their train. Such are the effects of taking too much security against enemies!
A small share of reflection might teach mankind, that in nothing is the rigid exercise of a sound temperance more indispensable to the well-being of the community than in this. It is clear to reason (alas, that reason should so rarely be the guide in these matters!) that the provision for defence should always be kept down to the lowest possible, rather than always raised to the highest possible terms! At the highest possible terms, the provision for defence really does all the mischief to a community which a foreign enemy could do; often does a great deal more than he would. A moderate provision against evils of frequent and sudden occurrence, a provision strictly proportioned to the occasion, and not allowed to go beyond it, will save more evil than it produces. All beyond this infallibly produces more evil than it prevents. It enfeebles, by impoverishing the nation, and by degrading with poverty and slavery the minds of those from whom its defence must ultimately proceed. It makes the country, in this manner, a much easier prey to a powerful enemy, than if it had been allowed to gather strength by the accumulation of its wealth, and by that energy in the defence of their country, which the people of a well-governed country alone can evince.
A navy is useful for the defence of Great Britain. But a navy of what extent? One would not, for example, wish the whole people of Great Britain engaged in the navy. The reason, we suppose, would be; because this would not contribute to strength, but weakness. This is an important admission. There is, then, a line to be drawn; a line between that extent of navy which contributes to strength, and that extent which, instead of contributing to strength, produces weakness. Surely it is a matter of first-rate importance to draw that line correctly. What attempt has ever been made to draw that line correctly? What attempt has ever been made to draw it at all? Can any body point out any land-marks which have been set up by the proper authority? Or, has the matter been always managed without measure or rule? And has it not thus always been an easy task to keep the navy in a state of excess, always beyond the line which separates the degree that would contribute to strength from the degree that infallibly contributes to weakness?
As the passion of England has always been to have too great a navy; a navy which, by its undue expence, contributed to weakness; so it has been its passion to have too many sailors for the supply of that navy. The sailors of a navy are drawn from the sailors of the maritime trade. But a navy of a certain extent requires, for its supply, a maritime trade of only a certain extent. If it goes beyond that extent, all the excess is useless, with regard to the supply of the navy. Now, what reason has ever been assigned to prove, that the maritime traffic of Great Britain would not, without the monopoly of the colonies, afford a sufficient supply of sailors to a sufficient navy? None, whatsoever: none, that will bear to be looked at. But till a reason of that sort, and a reason of indubitable strength, is adduced, the policy of the navigation laws remains totally without a foundation. In that case, it deserves nothing but rejection, as all the world must allow. It is a violent interference with the free and natural course of things; the course into which the interests of the community would otherwise lead them; without any case being made to appear which requires that violent disturbance.
The discussion of this supposed benefit of colonies, we shall not pursue any farther; for, it is a signal proof of the diffusion of liberal ideas, that the policy of the navigation laws has become an object of ridicule in the British Parliament, and finds even there but a small number of defenders.
Where profit from Mines of the precious Metals is the object of the Mother Country.
There is another singular case, created by mines of the precious metals. A colony may be formed and retained for the sake of the gold and silver it may produce. Of this species of colony, we have something of a specimen in the Spanish colonies of Mexico and Peru. The question is, whether any advantage can ever be derived from a colony of this description? The answer to this question is not doubtful; but it is not very easy, within the limits to which we are confined, to make the evidence of it perfectly clear to every body. In one case, and in one case alone, an advantage may be derived. That is the case, in which the colony contains the richest mines in the world. The richest mines in the world always, in the case of the precious metals, supply the whole world; because, from those mines, the metals can be afforded cheaper than the expense of working will allow them to be afforded from any other mines; and the principle of competition soon excludes the produce of all other mines from the market.
Now, the country, which contains the richest mines, may so order matters, as to gain from foreign countries, on all the precious metals which she sells to them, nearly the whole of that difference which exists between what the metal in working costs to her, and what, in working, it costs at the mines, which, next to hers, are the most fertile in the world.
She must always sell the metal so cheap, as to exclude the metal of those other mines from the market; that is, a trifle cheaper than they can afford to sell it. But, if her mines are sufficiently fertile, the metal may cost her much less in working than the price at which she may thus dispose of it. All the difference she may put in her exchequer. In three ways this might be done. The government might work the mines wholly itself. It might let them to an exclusive company. It might impose a tax upon the produce of the mine. In any one of these ways it might derive a sort of tribute from the rest of the world, on account of the gold and silver with which it supplied them. This could not be done, if the mines, without being taxed, were allowed to be worked by the people at large; because, in that case, the competition of the different adventurers would make them undersell one another, till they reduced the price as low as the cost of working would allow. Could the tax at the mine be duly regulated, that would be the most profitable mode; because the private adventurers would work the mines far more economically, than either the government or an exclusive company.
It is evident that this is a mode of deriving advantage from the possession of the richest mines of the precious metals, very different from that which was pursued by the Spanish government, and which has been so beautifully exposed by Dr. Smith. That government endeavoured to derive advantage from its mines, by preventing other countries from getting any part of their produce, and by accumulating the whole at home. By accumulating at home the whole of the produce of its mines, it believed (such was the state of its mind) that Spain would become exceedingly rich. By preventing other countries from receiving any part of that produce, it believed that it would compel them to continue poor. And, if all countries continued poor, and Spain became exceedingly rich, Spain would be the master of all countries.
In this specimen of political logic, which it would not be difficult to match nearer home, there are two assumptions, and both of them false. In the first place, that a country can accumulate, to any considerable extent, the precious metals; that is, any other way than by locking them up and guarding them in strong holds: In the next place that, if it could accumulate them, it would be richer by that means.
The first of these assumptions, that a country can keep in circulation a greater proportion than other countries of the precious metals, “by hedging in the cuckoo,” as it is humourously described by Dr. Smith, has been finely exposed by that illustrious philosopher, and requires no explanation here.
On the second assumption, that a country, if it could hedge in the precious metals, would become richer by that process, a few reflections appear to be required.
It is now sufficiently understood, that money, in any country, supposing other things to remain the same, is valuable just in proportion to its quantity. Take Mr. Hume’s supposition, that England were walled round by a wall of brass, and that the quantity of her money were, in one night, by a miracle, either raised to double, or reduced to one half. In the first case, every piece would be reduced to one half of its former value; in the second case, it would be raised to double its former value, and the value of the whole would remain exactly the same. The country would, therefore, be neither the richer nor the poorer; she would neither produce more nor enjoy more on that account.
It is never then, by keeping the precious metals, that a country can derive any advantage from them; it is by the very opposite, by parting with them. If it has been foolish enough to hoard up a quantity of the produce of its capital and labour in the shape of gold and silver, it may, when it pleases, make a better use of it. It may exchange it with other countries for something that is useful. Gold and silver, so long as they are hoarded up, are of no use whatsoever. They contribute neither to enjoyment nor production. You may, however, purchase with them, something that is useful. You may exchange them either for some article of luxury, and then they contribute to enjoyment; or you may exchange them for the materials of some manufacture, or the necessaries of the labourer, and then they contribute to production; then the effect of them is to augment the riches, augment the active capital, augment the annual produce of the country. So long as any country hoards up gold and silver, so long as it abstains from parting with them to other countries for other things, so long it deprives itself of a great advantage.
Conclusion.—Tendency of Colonial Possessions to produce or prolong bad Government.
If colonies are so little calculated to yield any advantage to the countries that hold them, a very important question suggests itself. What is the reason that nations, the nations of modern Europe, at least, discover so great an affection for them? Is this affection to be wholly ascribed to mistaken views of their utility, or partly to other causes?
It never ought to be forgotten, that, in every country, there is “a Few,” and there is “a Many;” that in all countries in which the government is not very good, the interest of “the Few” prevails over the interest of “the Many,” and is promoted at their expence. “The Few” is the part that governs; “the Many” the part that is governed. It is according to the interest of “the Few” that colonies should be cultivated. This, if it is true, accounts for the attachment to colonies, which most of the countries, that is, of the governments of modern Europe, have displayed. In what way it is true, a short explanation will sufficiently disclose.
Sancho Panza had a scheme for deriving advantage from the government of an island. He would sell the people for slaves, and put the money in his pocket. “The Few,” in some countries, find in colonies, a thing which is very dear to them; they find, the one part of them, the precious matter with which to influence; the other, the precious matter with which to be influenced;—the one, the precious matter with which to make political dependents; the other, the precious matter with which they are made political dependents;—the one, the precious matter by which they augment their power; the other, the precious matter by which they augment their riches. Both portions of the “ruling Few,” therefore, find their account in the possession of colonies. There is not one of the colonies but what augments the number of places. There are governorships and judgeships, and a long train of et ceteras; and above all, there is not one of them but what requires an additional number of troops, and an additional portion of navy. In every additional portion of army and navy, beside the glory of the thing, there are generalships, and colonelships, and captainships, and lieutenantships, and in the equipping and supplying of additional portions of army and navy, there are always gains, which may be thrown in the way of a friend. All this is enough to account for a very considerable quantity of affection maintained towards colonies.
But beside all this, there is another thing of still greater importance; a thing, indeed, to which, in whatever point of view we regard it, hardly any thing else can be esteemed of equal importance. The colonies are a grand source of wars. Now wars, even in countries completely arbitrary and despotical, have so many things agreeable to the ruling few, that the ruling few hardly ever seem to be happy, except when engaged in them. There is nothing to which history bears so invariable a testimony as this. Nothing is more remarkable than the frivolous causes which almost always suffice for going to war, even when there is little or no prospect of gaining, often when there is the greatest prospect of losing by it, and that, even in their own sense of losing. But if the motives for being as much as possible in war are so very strong, even to governments which are already perfectly despotic, they are much stronger in the case of governments, which are not yet perfectly despotic, of governments of which the power is still, in any considerable degree, limited and restrained.
There is nothing in the world, where a government is, in any degree, limited and restrained, so useful for getting rid of all limit and restraint, as wars. The power of almost all governments is greater during war than during peace. But in the case of limited governments, it is so, in a very remarkable degree.
In the first place, there is the physical force of the army, and the terror and awe which it impresses upon the minds of men. In the next place, there is the splendour and parade, which captivate and subdue the imagination, and make men contented, one would almost say happy, to be slaves. All this surely is not of small importance. Then there is an additional power with which the government is entrusted during war. And, far above all, when the government is limited by the will of only a certain portion of the people; as, it is, under the British government, by the will of those who supply with members the two houses of Parliament; war affords the greatest portion of the precious matter with which that will may be guided and secured. Nothing augments so much the quantity of that portion of the national wealth which is placed at the command of the government, as war. Of course, nothing puts it in the power of government to create so great a number of dependents, so great a number of persons, bound by their hopes and fears to do and say whatever it wishes them to do and say.
Of the proposition, that colonies are a grand source of wars, and of additional expence in wars; that expence, by which the ruling few always profit at the cost of the subject many; it is not probable that much of proof will be required.
With regard to additional expence, it can hardly appear to be less than self-evident. Whenever a war breaks out, additional troops, and an additional portion of navy, are always required for the protection of the colonies. Even during peace, the colonies afford the pretext for a large portion of the peace establishment, as it is called; that is, a mass of warlike apparatus and expence, which would be burdensome even in a season of war. How much the cost amounts to, of a small additional portion, not to speak of a large additional portion, of army and navy, Englishmen have had experience to instruct them; and how great the mischief which is done by every particle of unnecessary expence, they are daily becoming more and more capable of seeing and understanding.
That the colonies multiply exceedingly the causes and pretexts of war, is matter of history; and might have been foreseen, before reaping the fruits of a bitter experience. Whatever brings you in contact with a greater number of states, increases, in the same proportion, those clashings of interest and pride, out of which the pretexts for war are frequently created. It would exhibit a result, which probably would surprise a good many readers, if any body would examine all the wars which have afflicted this country, from the time when she first began to have colonies, and would show how very great a proportion of them have grown out of colony disputes.
J. Innes, Printer, 61, Wells-street, Oxford-street, London.