different employments carried on in it, as nearly as possible in the proportion which is most agreeable to the interest of the whole society.

the company may have made upon those goods in consequence of their monopoly, but for all the extraordinary waste which the fraud and abuse inseparable from the management of the affairs of so great a company must necessarily have occasioned. The absurdity of this second kind of monopoly, therefore, is much more manifest than that of the first.

Both these kinds of monopolies derange more or less the natural distribution of the stock of the society; but they do not always derange it in the same way.

All the different regulations of the mercantile system necessarily derange more or less this natural and most advantageous distribution of stock. But those which concern the trade to America and the East Indies derange it, perhaps, more than any other; because the trade to those two great continents absorbs a greater quantity of stock than any two other branches of trade. The regulations, however, Monopolies of the first kind always attract by which this derangement is effected in those to the particular trade in which they are estatwo different branches of trade, are not alto-blished a greater proportion of the stock of gether the same. Monopoly is the great en- the society than what would go to that trade gine of both; but it is a different sort of mo of its own accord. nopoly. Monopoly of one kind or another, indeed, seems to be the sole engine of the mercantile system.

Monopolies of the second kind may sometimes attract stock towards the particular trade in which they are established, and sometimes repel it from that trade, according to different circumstances. In poor countries, they naturally attract towards that trade more stock than would otherwise go to it. In rich countries, they naturally repel from it a good deal of stock which would otherwise go to it.

Such poor countries as Sweden and Denmark, for example, would probably have never sent a single ship to the East Indies, had not the trade been subjected to an exclusive The establishment of such a com

In the trade to America, every nation endeavours to engross as much as possible the whole market of its own colonies, by fairly excluding all other nations from any direct trade to them. During the greater part of the sixteenth century, the Portuguese endeavoured to manage the trade to the East Indies in the same manner, by claiming the sole right of sailing in the Indian seas, on account of the merit of having first found out the road to them. The Dutch still continue to exclude company. all other European nations from any direct pany necessarily encourages adventurers. Their trade to their spice islands. Monopolies of monopoly secures them against all competithis kind are evidently established against all tors in the home market, and they have the other European nations, who are thereby not same chance for foreign markets with the only excluded from a trade to which it might traders of other nations. Their monopoly be convenient for them to turn some part of shows them the certainty of a great profit uptheir stock, but are obliged to buy the goods on a considerable quantity of goods, and the which that trade deals in, somewhat dearer chance of a considerable profit upon a great than if they could import them themselves quantity. Without such extraordinary encoudirectly from the countries which produced ragement, the poor traders of such poor counthem. tries would probably never have thought of But since the fall of the power of Portu- hazarding their small capitals in so very disgal, no European nation has claimed the ex- tant and uncertain an adventure as the trade clusive right of sailing in the Indian seas, of to the East Indies must naturally have apwhich the principal ports are now open to the peared to them. ships of all European nations. Except in Such a rich country as Holland, on the Portugal, however, and within these few years contrary, would probably, in the case of a free in France, the trade to the East Indies has, trade, send many more ships to the East Inin every European country, been subjected to dies than it actually does. The limited stock an exclusive company. Monopolies of this of the Dutch East India company probably kind are properly established against the very repels from that trade many great mercantile nation which erects them. The greater part capitals which would otherwise go to it. The of that nation are thereby not only excluded mercantile capital of Holland is so great, that from a trade to which it might be convenient it is, as it were, continually overflowing, somefor them to turn some part of their stock, but times into the public funds of foreign counare obliged to buy the goods which that trade tries, sometimes into loans to private traders deals in somewhat dearer than if it was open and adventurers of foreign countries, someand free to all their countrymen. Since the times into the most round-about foreign trades establishment of the English East India com- of consumption, and sometimes into the carpany, for example, the other inhabitants of rying trade. All near employments being England, over and above being excluded from completely filled up, all the capital which can the trade, must have paid, in the price of the be placed in them with any tolerable profit Fast India goods which they have consumed, being already placed in them, the capital of not only for all the extraordinary profits which Holland necessarily flows towards the most

distant employments. The trade to the East | the adventure, but frequently occasion a very Indies, if it were altogether free, would pro- considerable loss. This argument, however, bably absorb the greater part of this redun-if it proved any thing at all, would prove dant capital. The East Indies offer a market that no one great branch of trade could be both for the manufactures of Europe, and for carried on without an exclusive company, the gold and silver, as well as for the several which is contrary to the experience of all na other productions of America, greater and tions. There is no great branch of trade, in more extensive than both Europe and Ame-which the capital of any one private merchant rica put together. is sufficient for carrying on all the subordi. Every derangement of the natural distri-nate branches which must be carried on, in bution of stock is necessarily hurtful to the order to carry on the principal one. But society in which it takes place; whether it be when a nation is ripe for any great branch of by repelling from a particular trade the stock trade, some merchants naturally turn their which would otherwise go to it, or by attract- capitals towards the principal, and some toing towards a particular trade that which wards the subordinate branches of it; and would not otherwise come to it. If, without though all the different branches of it are in any exclusive company, the trade of Holland this manner carried on, yet it very seldom to the East Indies would be greater than it happens that they are all carried on by the ca actually is, that country must suffer a consi-pital of one private merchant. If a nation, derable loss, by part of its capital being excluded from the employment most convenient for that port. And, in the same manner, if, without an exclusive company, the trade of Sweden and Denmark to the East Indies would be less than it actually is, or, what perhaps is more probable, would not exist at all, those two countries must likewise suffer a considerable loss, by part of their capital being drawn into an employment which must be more or less unsuitable to their present circumstances. Better for them, perhaps, in the present circumstances, to buy East India goods of other nations, even though they should pay somewhat dearer, than to turn so great a part of their small capital to so very distant a trade, in which the returns are so very slow, in which that capital can maintain so small a quantity of productive labour at home, where productive labour is so much wanted, where so little is done, and where so much is to do.

therefore, is ripe for the East India trade, a certain portion of its capital will naturally divide itself among all the different branches of that trade. Some of its merchants will find it for their interest to reside in the East Indies, and to employ their capitals there in providing goods for the ships which are to be sent out by other merchants who reside in Europe. The settlements which different European nations have obtained in the East Indies, if they were taken from the exclusive companies to which they at present belong, and put under the immediate protection of the sovereign, would render this residence both safe and easy, at least to the merchants of the particular nations to whom those settle ments belong. If, at any particular time, that part of the capital of any country which of its own accord tended and inclined, if I may say so, towards the East India trade, was not sufficient for carrying on all those different branches of it, it would be a proot Though without an exclusive company, that, at that particular time, that country was herefore, a particular country should not be not ripe for that trade, and that it would do able to carry on any direct trade to the East better to buy for some time, even at a higher Indies, it will not from thence follow, that price, from other European nations, the East such a company ought to be established there, India goods it had occasion for, than to im but only that such a country ought not, in port them itself directly from the East Indies. these circumstances, to trade directly to the What it might lose by the high price of those East Indies. That such companies are not goods, could seldom be equal to the loss which in general necessary for carrying on the East it would sustain by the distraction of a large India trade, is sufficiently demonstrated by portion of its capital from other employments the experience of the Portuguese, who enjoy-more necessary, or more useful, or more suited almost the whole of it for more than a able to its circumstances and situation, than century together, without any exclusive com- a direct trade to the East Indies.

pany.

Though the Europeans possess many conNo private merchant, it has been said, siderable settlements both upon the coast of could well have capital sufficient to maintain Africa and in the East Indies, they have not factors and agents in the different ports of the yet established, in either of those countries, East Indies, in order to provide goods for such numerous and thriving colonies as those the ships which he might occasionally send in the islands and continent of America. Af thither; and yet, unless he was able to do rica, however, as well as several of the counthis, the difficulty of finding a cargo might frequently make his ships lose the season for returning; and the expense of so long a delay would not only eat up the whole profit of

tries comprehended under the general name of the East Indies, is inhabited by barbarous nations. But those nations were by no means so weak and de enceless as the miserable and

helpless Americans; and in proportion to the be seen in its port.

Such advantageous situ

natural fertility of the countries which they ations have enabled those two colonies to surinhabited, they were, besides, much more mount all the obstacles which the oppressive populous. The most barbarous nations, genius of an exclusive company may have oceither of Africa or of the East Indies, were casionally opposed to their growth. They snepherds; even the Hottentots were so. have enabled Batavia to surmount the adBut the natives of every part of America, ex-ditional disadvantage of perhaps the most un. cept Mexico and Peru, were only hunters; wholesome climate in the world. and the difference is very great between the The English and Dutch companies, though number of shepherds and that of hunters, they have established no considerable colowhom the same extent of equally fertile terri-nies, except the two above mentioned, have tory can maintain. In Africa and the East both made considerable conquests in the East Indies, therefore, it was more difficult to Indies. But in the manner in which they displace the natives, and to extend the Euro- both govern their new subjects, the natural pean plantations over the greater part of the genius of an exclusive company has shewn itlands of the original inhabitants. The ge- self most distinctly. In the spice islands, the nius of exclusive companies, besides, is un- Dutch are said to burn all the spiceries which favourable, it has already been observed, to a fertile season produces, beyond what they the growth of new colonies, and has probably expect to dispose of in Europe with such a been the principal cause of the little progress profit as they think sufficient. In the islands which they have made in the East Indies. where they have no settlements, they give a The Portuguese carried on the trade both to premium to those who collect the young blosAfrica and the East Indies, without any ex- soms and green leaves of the clove and nutclusive companies; and their settlements at meg trees, which naturally grow there, but Congo, Angola, and Benguela, on the coast which this savage policy has now, it is said. of Africa, and at Goa in the East Indies, almost completely extirpated. Even in the though much depressed by superstition and islands where they have settlements, they have every sort of bad government, yet bear some very much reduced, it is said, the number of resemblance to the colonies of America, and those trees. If the produce even of their own are partly inhabited by Portuguese who have islands was much greater than what suited been established there for several generations. their market, the natives, they suspect, might The Dutch settlements at the Cape of Good find means to convey some part of it to other Hope and at Batavia, are at present the most nations; and the best way, they imagine, to considerable colonies which the Europeans secure their own monopoly, is to take care have established, either in Africa or in the that no more shall grow than what they themEast Indies; and both those settlements are selves carry to market. By different arts of peculiarly fortunate in their situation. The oppression, they have reduced the population Cape of Good Hope was inhabited by a race of several of the Moluccas nearly to the numof people almost as barbarous, and quite as ber which is sufficient to supply with fresh incapable of defending themselves, as the na- provisions, and other necessaries of life, their tives of America. It is, besides, the half-way own insignificant garrisons, and such of their house, if one may say so, between Europe ships as occasionally come there for a cargo and the East Indies, at which almost every of spices. Under the government even of the European ship makes some stay, both in go- Portuguese, however, those islands are said ing and returning. The supplying of those to have been tolerably well inhabited. The ships with every sort of fresh provisions, with English company have not yet had time to fruit, and sometimes with wine, affords alone establish in Bengal so perfectly destructive a a very extensive market for the surplus pro- system. The plan of their government, howduce of the colonies. What the Cape of ever, has had exactly the same tendency. It Good Hope is between Europe and every has not been uncommon, I am well ssured, part of the East Indies, Batavia is between for the chief, that is, the first clerk or a facthe principal countries of the East Indies. tory, to order a peasant to plough up a rich It lies upon the most frequented road from field of poppies, and sow it with rice, or some Indostan to China and Japan, and is nearly other grain. The pretence was, to prevent a about mid-way upon that road. Almost all scarcity of provisions; but the real reason, to the ships, too, that sail between Europe and give the chief an opportunity of selling at a China, touch at Batavia; and it is, over and better price a large quantity of opium which above all this, the centre and principal mart he happened then to have upon hand. Upon of what is called the country trade of the East other occasions, the order has been reversed; Indies; not only of that part of it which is and a rich field of rice or other grain has carried on by Europeans, but of that which is been ploughed up, in order to make room carried on by the native Indians; and vessels for a plantation of poppies, when the chief navigated by the inhabitants of China and Ja- foresaw that extraordinary profit was likely pan, of Tonquin, Malacca, Cochin-China, to be made by opium. The servants of the and the island of Celebes, are frequently to company have, upon several occasions, at

tempted to establish in their own favour the which they may be enabled to buy cheaper in monopoly of some of the most important India, and thereby to sell with a better profit branches, not only of the foreign, but of the in Europe. They endeavour, for this pur inland trade of the country. Had they been pose, to keep out as much as possible all allowed to go on, it is impossible that they competitors from the market of the countries should not, at some time or another, have at- which are subject to their government, and tempted to restrain the production of the parti consequently to reduce, at least, some part of cular articles of which they had thus usurped the surplus produce of those countries to what the monopoly, not only to the quantity which is barely sufficient for supplying their own they themselves could purchase, but to that demand, or to what they can expect to sell in which they could expect to sell with such a Europe, with such a profit as they may think profit as they might think sufficient. course of a century or two, the policy of the English company would, in this manner, have probably proved as completely destructive as that of the Dutch.

As

In the reasonable. Their mercantile habits draw them in this manner, almost necessarily, though perhaps insensibly, to prefer, upon all ordinary occasions, the little and transitory profit of the monopolist to the great and permanent Nothing, however, can be more directly revenue of the sovereign; and would gra contrary to the real interest of those com- dually lead them to treat the countries subpanies, considered as the sovereigns of the ject to their government nearly as the Dutch countries which they have conquered, than treat the Moluccas. It is the interest of the this destructive plan. In almost all coun- East India company, considered as sovereigns, tries, the revenue of the sovereign is drawn that the European goods which are carried to from that of the people. The greater the their Indian dominions should be sold there evenue of the people, therefore, the greater as cheap as possible; and that the Indian the annual produce of their land and labour, goods which are brought from thence should the more they can afford to the sovereign. It bring there as good a price, or should be sold is his interest, therefore, to increase as much there as dear as possible. But the reverse as possible that annual produce. But if this of this is their interest as merchants. 's the interest of every sovereign, it is pecu- sovereigns, their interest is exactly the same fiarly so of one whose revenue, like that of with that of the country which they govern. the sovereign of Bengal, arises chicfly from a As merchants, their interest is directly oppo land-rent. That rent must necessarily be in site to that interest. proportion to the quantity and value of the But if the genius of such a government, produce; and both the one and the other even as to what concerns its direction in Euinust depend upon the extent of the market. rope, is in this manner essentially, and per. The quantity will always be suited, with haps incurably faulty, that of its administra more or less exactness, to the consumption of tion in India is still more so. That adminithose who can afford to pay for it; and the stration is necessarily composed of a council price which they will pay will always be in pro- of merchants, a profession no doubt extremely portion to the eagerness of their competition. respectable, but which in no country in the It is the interest of such a sovereign, there- world carries along with it that sort of authofore, to open the most extensive market for rity which naturally overawes the people, and the produce of his country, to allow the most without force commands their willing obeperfect freedom of commerce, in order to in-dience. Such a council can command obe

crease as much as possible the number and dience only by the military force with which competition of buyers; and upon this account they are accompanied; and their government to abolish, not only all monopolies, but all is, therefore, necessarily military and despotirestraints upon the transportation of the home cal. Their proper business, however, is that produce from one part of the country to of merchants. It is to sell, upon their mas another, upon its exportation to foreign coun- ter's account, the European goods consigned tries, or upon the importation of goods of to them, and to buy, in return, Indian goods any kind for which it can be exchanged. He for the European market. It is to sell the is in this manner most likely to increase both one as dear, and to buy the other as cheap as the quantity and value of that produce, and possible, and consequently to exclude, as consequently of his own share of it, or of his much as possible, all rivals from the particular market where they keep their shop.

awn revenue.

The But a company of merchants, are, it seems, genius of the administration, therefore, so incapable of considering themselves as sove- far as concerns the trade of the company, is reigns, even after they have become such. the same as that of the direction. It tends Trade, or buying in order to sell again, they to make government subservient to the intestill consider as their principal business, and rest of monopoly, and consequently to stunt by a strange absurdity, regard the character the natural growth of some parts, at least, of of the sovereign as but an appendix to that of the surplus produce of the country, to what the merchant; as something which ought to is barely sufficient for answering the demand be made subservient to it, or by means of of the company,

It tend>

All the members of the administration, duce the number of its inhabitants. besides, trade more or less upon their own ac- to reduce the quantity of every sort of produce, count; and it is in vain to prohibit them even that of the necessaries of life, whenever from doing so. Nothing can be more com- the servants of the country choose to deal in pletely foolish than to expect that the clerks them, to what those servants can both afford of a great counting-house, at ten thousand to buy and expect to sell with such a profit as miles distance, and consequently almost quite pleases them. out of sight, should, upon a simple order From the nature of their situation, too, the from their master, give up at once doing any servants must be more disposed to support sort of business upon their own account; with rigourous severity their own interest, abandon for ever all hopes of making a for- against that of the country which they gotune, of which they have the means in their veru, than their masters can be to support hands; and content themselves with the theirs. The country belongs to their masters, moderate salaries which those masters allow who cannot avoid having some regard for the them, and which, moderate as they are, can interest of what belongs to them; but it does seldom be augmented, being commonly as not belong to the servants. The real interest large as the real profits of the company trade of their masters, if they were capable of uncan afford. In such circumstances, to pro- derstanding it, is the same with that of the hibit the servants of the company from trad-country; and it is from ignorance chiefly, ing upon their own account, can have scarce and the meanness of mercantile prejudice, any other effect than to enable its superior that they ever oppress it. But the real inservants, under pretence of executing their terest of the servants is by no means the same master's order, to oppress such of the inferior with that of the country, and the most perfect. ones as have had the misfortune to fall under information would not necessarily put an end their displeasure. The servants naturally to their oppressions. The regulations, acendeavour to establish the same monopoly in cordingly, which have been sent out from favour of their own private trade as of the Europe, though they have been frequently public trade of the company. If they are weak, have upon most occasions been well suffered to act as they could wish, they will meaning. More intelligence, and perhaps establish this monopoly openly and directly, less good meaning, has sometimes appeared by fairly prohibiting all other people from in those established by the servants in India. trading in the articles in which they choose to It is a very singular government in which deal; and this, perhaps, is the best and least every member of the administration wishes to oppressive way of establishing it. But if, by get out of the country, and consequently to an order from Europe, they are prohibited have done with the government, as soon as he from doing this, they will, notwithstanding, can, and to whose interest, the day after he endeavour to establish a monopoly of the has left it, and carried his whole fortune with same kind secretly and indirectly, in a way him, it is perfectly indifferent though the that is much more destructive to the country. whole country was swallowed up by an earthThey will employ the whole authority of go- quake. vernment, and pervert the administration of I mean not, however, by any thing which I justice, in order to harass and ruin those who have here said, to throw any odious impuainterfere with them in any branch of com- tion upon the general character of the servants merce, which by means of agents, either of the East India company, and much less concealed, or at least not publicly avowed, upon that of any particular persons. It is they may choose to carry on. But the pri- the system of government, the situation in vate trade of the servants will naturally extend which they are placed, that I mean to cento a much greater variety of articles than the sure, not the character of those who have public trade of the company. The public acted in it. They acted as their situation natrade of the company extends no further than turally directed, and they who have clamoured the trade with Europe, and comprehends a the loudest against them would probably not part only of the foreign trade of the country. have acted better themselves. In war and But the private trade of the servants may negotiation, the councils of Madras and Calextend to all the different branches both of cutta, have upon several occasions, conducted its inland and foreign trade. The monopoly themselves with a resolution and decisive of the company can tend only to stunt the na- wisdom, which would have done honour to tural growth of that part of the surplus pro- the senate of Rome in the best days of that duce which, in the case of a free trade, would republic. The members of those councils, be exported to Europe. That of the servants however, had been bred to professions very tends to stunt the natural growth of every different from war and politics. But their part of the produce in which they choose to situation alone, without education, experience, deal; of what is destined for home consump

tion, as well as of what is destined for expor- * The interest of every proprietor of India stock, howtation; and consequently to degrade the ever, is by no means the same with that of the country in the government of which his vote gives him some cultivation of the whole country, and to re-influence.-See book v, chap. i, part ii.