I have read your Common Sense, which is good sense, and so intelligible that he who runs may read, and he who reads can scarcely fail to understand.
I wish you had treated the subject of monopolies more copiously, and informed your readers that in the early ages of commerce monopolies were so extended, and the principle so abused, that they could not fail to become obnoxious to all, and tradition has made the name hateful ever since.
The kings of France, particularly Louis XIV. to raise money sold maitrices, as they were called, or a sort of privilege for exercising certain trades, and he at the same time limited the number, this practice, together with the former monopolies not abolished, created a general wish for Freedom of Trade in France.[A] The sect of economists were composed of republican philosophers, who proclaimed the grand advantages to be derived from the entire Freedom of Trade, nor was it then foreseen that under that pretext they were seeking Liberty and Equality, which but a few years after deluged France with the blood of her best sons, and had nearly ruined the world.
You mention Adam Smith, he was the disciple and admirer of the economists; in a word he was what we denominate a democrat. As to entire Freedom of Trade, who that ever thought on the subject could dream of it. The corn laws, all bounties and drawbacks, the regulation even of weights and measures, the assay of silver and gold, the interest of money, &c. &c. &c. are directly in opposition to it, and prove the economists were wrong. When the French revolution broke out, excepting in weights and measures, every restraint was done away, but instead of things improving thereby they grew visibly worse. A short history of monopolies would be a very useful work, as it would clear up many mistakes concerning them.
If Adam Smith were now alive he would probably have changed many of his opinions, for he was a good, and honest, as well as an able man, but he was deceived, not being initiated in the ulterior mysteries of M. Turgot and his associates.
I am your's, &c.
FREE TRADE WITH INDIA. &c. &c.
The questions that have arisen of late respecting the East India Company, or rather the Commerce with India, for that is the stake and nothing less, are undoubtedly of great and serious importance. To enter into all the ramifications of the subject would require volumes, the mere bulk of which would startle most readers, and prevent their going into the question, and induce them to take up with the opinions of one, who appearing to have bestowed labour and attention on the subject, shapes his results in the manner best suited to his purpose. This mode of proceeding almost as old as the creation, and which will continue as long as any man pays a deference to the judgment of another, is the grand engine of designing men to bias the minds of the million who "hate the labour of a serious thought," a specious appellation is enough for the million to form a decision upon. I could instance many of these senseless war-whoops from "_Liberty_ and Equality" to "_a Free Trade_,"[B] were it necessary, or at all to the point.
This mode, however, is only objectionable in the hands of sinister persons, for where the question at issue like the present, is very intricate, some such mode must be had recourse to, in order to simplify the question; I have therefore always considered that to take a popular view of a subject, some great leading points must be seized, and from these our judgment should be formed. This, if not the most accurate, is at least the best mode, where what is called public feeling is to be consulted.
To study the interests of Great Britain and of British merchants with regard to the trade with India; to combine those with the territorial possessions and the interests of the country at large; to investigate also not only what would be the immediate consequences of a sudden change, but what might be the ultimate effects, are all necessary, to form that sort of judgment proper for the basis of action. That those immediately concerned with the affairs of India have examined the subject with great care and to good purpose, is abundantly evident from the correspondence, speeches, and pamphlets, already before the public; fraught as they are with many important facts, much acute observation, and for the most part dictated by a desire to come, if possible, to the best conclusion, all this is evident, yet it strikes me that something useful remains behind.
Were the question simply between Government and the Company, I should not descant upon it; aware as I am that it has been canvassed by the parties on every ground and in every shape; but there is a third party who has interfered. The merchants at large all over the kingdom, the shippers at the out-ports, and the manufacturers in the interior, all urged on by what is termed the public voice, crying out A Free Trade and No Monopoly.
The trading towns, cities, and manufacturers do not pretend to have considered the subject minutely; therefore, for aught they know to the contrary, they are acting honestly and right; I will therefore address them with that open frankness which such conduct deserves, and which may lead to a conclusion very different from what was aimed at in the last Session of Parliament.
For the sake of perspicuity I shall consider the subject under different heads.
I. All monopolies are not wrong or injurious, as in some cases, we are the best and cheapest served by a monopoly; this proved, it follows that the India Company being possessed of a monopoly, does not of itself argue that it should be withdrawn.
II. That the trade with India is far from being carried on, on the principle of monopoly.
III. That any great change must be attended with great danger, consequently we must not follow theory too readily, but pay great respect to practice and experience.
IV. That the public at large have no reason to complain of the India Company, as the articles brought by it have not increased in price in proportion either to rums or sugars from the West Indies, where there is no monopoly.
V. That the merchants of Liverpool, Hull, &c. and the manufacturers in their endeavours to share the trade with London, are seeking what would be injurious to them.
VI. That some errors were fallen into in the present Charter, which may be advantageously corrected in the next, and a few slight amendments may be attempted with safety, but no great change or innovation.
I. All monopolies are not wrong or injurious, as in some cases, we are the best and cheapest served by a monopoly, this once proved, it follows that the India Company being possessed of a monopoly, does not of itself argue that it should be withdrawn.
The manner in which the public can be the best and cheapest supplied with an article, is in itself the best, whether it be by a monopoly or not. This is conceded even by Adam Smith, that great enemy to monopolies; and he adduces in proof the Post Office, which is one of the strictest and most complete monopolies in existence, yet the business is done remarkably cheap and well, and with a degree of security not otherwise attainable. It is infinitely more correct than the carriage of small parcels, which is by open competition, and all circumstances considered much cheaper.
The Bank of England is partly a monopoly, but by no means a complete one, and it is better regulated and does business better than private banks that issue notes, and which are so far its rivals.
Most of the concerns which have been brought to maturity in this country have first flourished as monopolies under the name of patents, and indeed there are many reasons for highly praising those temporary monopolies.[C]
The insurance companies are not exactly monopolies, neither are they free traders in the true acceptation of the term, jointly or separately taking insurances without legislative interference; and, without such companies, it would be impracticable to carry on insurance so well as it is done.
Navigations and water-works companies are monopolies in principle, but they are necessary and advantageous.
From all these examples it follows, that monopoly is not bad merely as monopoly, and that its being injurious depends on particular circumstances, and therefore the India Company being a company of monopolists, would not be a sufficient reason for its abolition, even were it proved to be so, but this has not yet been done.
II. That the Trade with India is far from being carried on, upon the principle of monopoly.
From the first discovery of India, and the most ancient and authentic records in existence, we learn that the trade to the East, which produces whatever is most brilliant to the eye, most delicious to the taste, or agreeable to the smell, has been the envy of nations. To share in them, Solomon built Tadmor in the desert, (the Hebrew name, in Greek, Palmyra); for this Alexander the Great destroyed Tyre, built Alexandria and invaded India; for this trade Venice, Genoa, and Constantinople contended above eight hundred years, when the discovery of a passage by the Cape of Good Hope, wrested that commerce from the ancient competitors, and the Dutch and Portuguese became the successors of those inland merchants, who partly by caravans and partly by navigation, had supplied Europe with the silks, the pearls, the perfumes, and the precious stones of Asia from the earliest ages.
At so great a distance every power that traded found it necessary to have an establishment. The Inhabitants have not laws sufficient to protect the merchant, such as are necessary to a flourishing state of commerce; hence arose settlements and conquests, of the moral justice of which, I have nothing to say in this place; but being established, in order to maintain them, it was necessary to have revenues, and to continue certain privileges to the first traders, in order that they might act as a body, and supply from the general stock what was for the general advantage.
The great body of the public are perhaps not aware that so far from ever intending to make a monopoly of the trade to India, there were in fact two companies at one time, and that experience proved it was necessary to unite them into one, since which period, the public, as well as the servants of the company have always been permitted to participate on certain conditions.[D]
The above is a very brief, but true history of the trade to India; now we will consider its present state as a supposed monopoly. As to the trade to China in tea, and to certain other articles, and also to ships there is monopoly, but if the trade to China were open to all the irregularities of common trading vessels, we should be excluded from it entirely in six months. The utmost circumspection and delicacy being necessary in trading with that country, besides which, the commerce demands such a large extent of capital and produces so little profit, that it would not answer the purpose of individual merchants.
It is however sufficient for this article to say, that the company carry out and bring home a great variety of articles, at a fixed, and indeed at a very low rate of freight, such as no individual would do, or ever attempted to do. That if any manufacturer or merchant can find out an article that will sell in India, the company so far from preventing his doing so, afford him facilities not otherwise attainable. No mistake can in fact be greater than to say, with the uninformed and misled public, that the East India Company is a monopoly, and injures trade by preventing our merchants and manufacturers from having a scope for their capital and industry. Thus then the clamour raised last year, in favour of what is called a free trade, is entirely founded in error, but even were it not so, we may fairly enquire.
