its development. To such an excess was the protective system at one time carried, that it was not uncommon to forbid the use of new manufactures, even when produced at home, lest they might interfere with those already established. So late as 1721, the wearing of calicoes was prohibited, for the avowed purpose of encouraging the woollen and silk manufactures, by the imposition of a penalty of £20 on the seller, and of £5 on the wearer. In 1736 this law was repealed as to British calicoes, provided, however, that the warp were of linen yarn. It is almost superfluous to add, that, without the repeal of these absurd statutes, the cotton manufacture could not have made any progress amongst us.

But the exclusion of all competition, and the monopoly of the home market were not enough to satisfy the manufacturers and merchants. Having obtained all the advantage they could from the public, they next attempted to prey on each other. Such of them as possessed most influence procured the privilege of carrying on particular branches of industry to the exclusion of every one else. This abuse was carried to a most oppressive height in the reign of Elizabeth, who granted an infinite number of new patents; and the grievance became at length so insupportable as to make all classes join in petitioning for its abolition; and this, after much opposition on the part of the Crown, which looked upon the power to erect monopolies as a very valuable branch of the prerogative, was effected by an act passed in 1624, (21 Jac. I. cap. 3.) By abolishing a number of oppressive

monopolies, and restoring the freedom of internal industry, this act did more, perhaps, than any other in the statute-book to accelerate the progress of improvement; but it touched none of the fundamental principles of the mercantile or manufacturing system; and the privileges of all bodies-corporate were exempted from its operation.

In France the interests of the manufacturers were warmly espoused by the celebrated M. Colbert, minister of finance during the most splendid period of the reign of Louis XIV.; and the year 1664, when the famous tariff, compiled under his direction, was promulgated, has been sometimes considered, though, as has been seen, erroneously, as the era of the mercantile system.1

The restrictions in favour of the manufacturers were all zealously supported by the advocates of the mercantile system and the balance of trade. The facilities given to the exportation of goods manufactured at home, and the obstacles thrown in the way of importation from abroad, seemed peculiarly well fitted for making the exports exceed the imports, and procuring a favourable balance. Instead, therefore, of these regulations being regarded as the offspring of a selfish, monopolizing spirit, they were looked upon as having been dictated by the soundest policy. The interests of the manufacturers and merchants were universally supposed to be identified with each other, and also with those of the public. The acquisition of a favourable balance of payments

1 See Mengotti, "Dissertazione sul Colbertismo," cap. xi.

was the grand object to be accomplished; and heavy duties and restrictions on importation, and bounties on exportation, were the means by which it was to be attained. It cannot excite surprise, that a system having so many popular prejudices in its favour, and which afforded a plausible apology for the exclusive privileges enjoyed by the manufacturing and commercial classes, should have early attained, or that it should still preserve, notwithstanding the overthrow of its principles, much practical influence.'

"It is," says M. Storch, "no exaggeration to affirın, that there are very few political errors which have produced more mischief than the mercantile system. Armed with power, it has commanded and forbid, where it should only have protected. The regulating mania which it has inspired, has tormented industry in a thousand ways, to force it from its natural channels. It has made each nation regard the welfare of its neighbours as incompatible with its own; hence the reciprocal desire of injuring and impoverishing each other; and hence that spirit of commercial rivalry which has been the immediate or remote cause of the greater number of modern wars. This system has stimulated nations to employ force or cunning to extort commercial treaties, productive of no real advantage to themselves, from the weakness or igno

Melon and Forbonnais in France; Genovesi in Italy; Mun, Sir Josiah Child, Dr. Davenant, the authors of the British Merchant, and Sir James Steuart, in England, are the ablest writers who have espoused, some with more, and some with fewer exceptions, the leading principles of the mercantile system.

rance of others. It has formed colonies, that the mother country might enjoy the monopoly of their trade, and force them to resort only to her markets. In short, where this system has been productive of the least injury, it has retarded the progress of national prosperity; every where else it has deluged the earth with blood, and has depopulated and ruined some of those countries whose power and opulence it was supposed it would carry to the highest pitch."

The shock given to previous prejudices and systems by those great discoveries and events, which will for ever distinguish the fifteenth and sixteenth centuries, and the greater attention which the progress of civilization and industry naturally drew to the sources of national power and opulence, prepared the way for the downfal of the mercantile system. The advocates of the East India Company, whose interests had first made them question the prevailing doctrines as to the exportation of bullion, gradually assumed a higher tone; and at length boldly contended that bullion was nothing but a commodity, and that there was no good reason for restraining its free exportation. Similar opinions were soon after avowed by others. Many eminent merchants began to look with suspicion on several of the received maxims; and acquired more correct and comprehensive views of the principles of commercial intercourse.

The

Storch, "Cours d'Economie Politique," tom. i. p. 102. Paris edition.

new ideas ultimately made their way into the House of Commons; and in 1663, the statutes prohibiting the exportation of foreign coin and bullion were repealed; full liberty being given to the East India Company and to private traders, to export them in unlimited quantities.

In addition to the controversy about the East India trade, the discussions respecting the foundation of the colonies in America and the West Indies, the establishment of a compulsory provision for the support of the poor, the prohibition of the export of wool, &c., attracted, in the seventeenth century, an extraordinary portion of the public attention to questions connected with the commercial and domestic policy of the country. In its course a more than usual number of tracts were published on economical subjects. And though the authors of the greater number were strongly imbued with the prejudices of the age, it cannot be denied, that several amongst them emancipated themselves from their influence, and have an unquestionable right to be regarded as the founders of the modern theory of commerce-as the earliest expositors of those sound and liberal doctrines, which show that the prosperity of states can never be promoted by restrictive regulations, or by the depression of their neighbours-that the genuine spirit of commerce is inconsistent with the selfish and shallow policy of monopoly-and that the self-interest of mankind, not less than their duty, requires them to live in peace, and to cultivate a fair and friendly intercourse with each other.