Britain and Holland; they are likewise, in proportion to the extent of their land and population, the two richest countries. But there is no ground to conclude that the magnitude of their mercantile navy has been the cause of their opulence. The carrying trade no doubt has yielded profits, but not higher than the other capital of these countries employed in domestic occupations.

The effects of the much-extolled Navigation Act of England have been greatly misconceived. Admitting always the paramount importance of securing our national independence, to which everything else must give place, and that nothing can so effectually do this as the maintenance of a naval superiority, it is still open to inquiry, whether this naval superiority might not have been more effectually secured by other means. When this celebrated Act was passed, the abundance of capital in Holland, in proportion to the employment for it there, had reduced the rate of profit on capital in that republic much below the level in the rest of Europe. Her ship-owners were, consequently, content with receiving lower freights than those of other countries, and were engrossing the carrying trade of Europe. In an economical point of view, there can be no doubt that England, under such circumstances, would have been a gainer by paying the lower freights of the Dutch, and employing her own capital in those branches of production at home in which a higher profit could have been realized, instead of investing it in the shipping of goods. Assuming, for illustration, that the rate of profit was fifteen per cent. in England, and only ten per cent. in Holland, then the expense of freight on foreign commodities was enhanced to the people of England on the passing of this Act to the amount of five per cent. on the capital embarked in it; while their capital thus drawn from agriculture or manufactures to be employed in the carrying trade, must have caused a falling off in the produce of their domestic industry. Had England imposed increased duties on the goods transported, equal to the saving of five per cent. on the freight by employing the Dutch, the effect on the circumstances of her people, as regards their supply of foreign goods, would have been precisely the same. The money thus permanently raised would have enabled her to

bring up and train for naval service the number of men that might be required in time of war, and have made a considerable saving into the bargain; while the permanent increased produce of her agriculture and manufactures, secure from the vicissitudes of naval affairs, would have promoted the wealth and prosperity of the country, on which eventually her power must depend, and would not have been without their effects to the present moment. By excluding the Dutch from our carrying trade, the country lost the employment of the capital thus engaged. As much as the wealth of our country was lessened by the falling off in the produce of domestic industry through not having this Dutch capital employed, and consequently forcing our own capital into a less advantageous employment, so much must our power have been diminished. Let us notice the effect on the Dutch, had they been allowed to engross our carrying trade. We suppose, through competition, that they gained no greater profits in this employment than they gained by employing their capital in other ways. There would have been, perhaps, a larger opening for capital by the liberty of engaging in this trade, and the profits on the whole capital of their country might have been in a small degree increased thereby. But an increase obtained on the profits of capital employed at home, when that capital itself, or the produce it raises, is not increased, does not in any way augment the national resources; because this increased profit is then obtained by the capitalist at the expense of the other classes. Though, therefore, the mercantile marine of Holland might have covered the seas, it does not follow that she would have been enabled to command them. Her naval force could only have been kept up by taxes, and the produce of these must have depended on the wealth and resources of her people. By preventing their engaging in our carrying trade, their capital was, perhaps, transported in greater quantities to the East Indies. If an equal return was produced from thence to what would have been procured from the carrying trade, the wealth of Holland, and consequently her naval power, was in no way diminished; whilst the wealth and power of our own country must undoubtedly have suffered from the scarcity of capital, occasioned by the necessity of embarking a portion of it in a

precarious carrying trade. We conclude that this so much vaunted Act has kept down the wealth and power of England below the height to which it would otherwise have risen, without promoting our naval superiority more than it might have been promoted without it. It is to an overreaching policy, that would make ourselves rich and powerful at the expense of our neighbours, exemplified in this and other Acts in our commercial system, that we owe much of that jealousy which is felt towards us on the part of foreign countries, and in part, also, the almost continual warfare in which we have been engaged. Is it by such actions, which in common life would be denounced as disgraceful, that the honour of a high-minded and generous people is sought to be upheld? If, however, the benefits supposed to have been procured by this Act had been much more apparent than they are, and the evils attending it much less evident, the case becomes entirely altered, and its effects, so far as advantage is concerned, rendered not merely nugatory, but mischievous, when we come to have the same policy retaliated by other countries against ourselves. Was it then worth while, for the more than doubtful benefits it conferred, to continue this Act, at the hazard of such retaliation, and the consequent evils to all parties which must necessarily ensue?

Foreign commerce is only different from the home trade in the circumstance that one of the two parties to its transactions is the subject of another state, instead of both being subjects of the same state. Should a conquest or a union of two countries carrying on commerce with each other place them under the same sovereign power, the foreign character would be lost to this commerce, and it would assume that of the home trade. But such a circumstance could not alter the nature of the commerce, or the extent of the benefits it might confer. A very considerable extent of country is necessary to establish a proper distribution of employments, and to comprise within it the variety of soils, climates, and productions, which furnish our supply. A small state has not a population of sufficient magnitude or extent of country enough to furnish its own supply, independently of foreign countries; while a larger state is much more able to do so.

Depending thus on population and extent of coun

try, and on the adventitious circumstance of territorial boundaries, foreign commerce must be greater in relation to internal commerce in small states, and the internal commerce relatively greater in large states. Take the case of one of the small Italian states, in contrast with the empire of Russia. In the former, a considerable portion of its mercantile transactions have the character of foreign; while in the latter, containing within itself almost all the varieties of soil and climate, its foreign. commerce must form so small a portion of its whole mercantile transactions, as to be hardly capable of a relative appreciation. Again, the portion of these transactions which bear the character of foreign must be greater in those provinces of a large country which border on a neighbouring country, than in such as are situated more in the interior. But, notwithstanding that the character of foreign or home is a sort of adventitious quality, causing no essential difference in the nature of the trade itself, there is a peculiar importance attached by some persons to the foreign trade, as though it were of a different nature, and of superior value to the home trade. We have looked to the exports and imports as an index of the prosperity or decline of our country; while the state of the internal trade has excited no particular observation. But since the two are in their nature essentially the same, it would be wrong to attach a higher value to one than to the other. The activity of the home trade is as much an index of national prosperity as that of the foreign trade. Besides, the amount of exports and imports may be increased or diminished by circumstances which may have little or no effect on public prosperity. A decrease of foreign commerce may proceed from the people of different countries having acquired nearly equal facilities in the production of commodities in which previously a greater inequality subsisted. In countries situated under the same degrees of latitude, and affording similar natural productions, the acquisition of nearly equal facilities in their different branches of industry may perhaps be expected. In such case, the commerce between them in many commodities must cease. A falling off of foreign commerce, therefore, may indicate nothing more than that either ourselves or other countries have acquired the means of producing at

home, as cheaply, articles which formerly could not be produced so cheaply as in other countries. But this may not be attended with any material effects on the prosperity of a nation. From the magnitude of the benefits which commerce confers, its extension, however, when it is the result of natural circumstances, cannot but be regarded with satisfaction; whether it be internal, external, or both; and as much in the one case as in the other. When commerce establishes itself without external force or allurement, it indicates a greater division of employment, and superior facility in the production of goods. It produces a larger and more extended market; consequently, one that is less liable to be strongly acted upon by the fluctuations which proceed only from local or temporary causes.

The natural commerce of the world is that between countries situated under different degrees of latitude, where different degrees of temperature subsist. This is that commerce which is permanent, from the nature of things, and must always be free from those fluctuations which the progress of industry in different countries may effect in other branches of commerce. The temperate climate cannot produce the sugar, coffee, cotton, and other productions of the tropical region; neither are the tropical regions suited to raise the productions of the temperate and cold countries. This is nearly the only indispensable commerce; and is that which most highly conduces to our enjoyment. While advantages of a high order would ensue from the extension of other branches of commerce, an enlargement of the intercourse with the hot countries would add even still more to the comforts of the people.

As the several nations of the world advance in wealth, in science, and population, and in the perception of their true interest as regards commercial affairs; and as their intercourse becomes facilitated from improvements in methods of conveyance; commercial relations must gradually become more intimate, and the benefits they confer be more extended. That species of commerce, indeed, which now in a high degree conduces to the supply of our wants, and which is carried on between new and old countries, may in time be lost. In the former, raw produce bears a low value in relation to wrought goods; but as these