without any exportation, but merely by their
own waste and extravagance, be in great want
of them the next. Money, on the contrary, is
a steady friend, which, though it may travel
about from hand to hand, yet if it can be kept
from going out of the country, is not very liable
to be wasted and consumed. Gold and
silver, therefore, are, according to him, the
most solid and substantial part of the moveable
wealth of a nation; and to multiply those
metals ought, he thinks, upon that account,
to be the great object of its political economy.
Others admit, that if a nation could be separated
from all the world, it would be of no
consequence how much or how little money
circulated in it. The consumable goods,
which were circulated by means of this money,
would only be exchanged for a greater or a
smaller number of pieces; but the real wealth
or poverty of the country, they allow, would
depend altogether upon the abundance or scarcity
of those consumable goods. But it is
otherwise, they think, with countries which
have connections with foreign nations, and
which are obliged to carry on foreign wars,
and to maintain fleets and armies in distant
countries. This, they say, cannot be done,
but by sending abroad money to pay them
with; and a nation cannot send much money
abroad, unless it has a good deal at home.
Every such nation, therefore, must endeavour,
in time of peace, to accumulate gold and silver,
that when occasion requires, it may have
wherewithal to carry on foreign wars.
In consequence of these popular notions, all
the different nations of Europe have studied,
though to little purpose, every possible means
of accumulating gold and silver in their respective
countries. Spain and Portugal, the
proprietors of the principal mines which supply
Europe with those metals, have either prohibited
their exportation under the severest
penalties, or subjected it to a considerable duty.
The like prohibition seems anciently to
have made a part of the policy of most other
European nations. It is even to be found,
where we should least of all expect to find it,
in some old Scotch acts of Parliament, which
forbid, under heavy penalties, the carrying
gold or silver forth of the kingdom. The like
policy anciently took place both in France and
England.
When those countries became commercial,
the merchants found this prohibition, upon
many occasions, extremely inconvenient. They
could frequently buy more advantageously
with gold and silver, than with any other commodity,
the foreign goods which they wanted,
either to import into their own, or to carry to
some other foreign country. They remonstrated,
therefore, against this prohibition as
hurtful to trade.
They represented, first, that the exportation
of gold and silver, in order to purchase foreign
goods, did not always diminish the
quantity of those metals in the kingdom; that,
on the contrary, it might frequently increase
the quantity; because, if the consumption of
foreign goods was not thereby increased in the
country, those goods might be re-exported to
foreign countries, and being there sold for a
large profit, might bring back much more treasure
than was originally sent out to purchase
them. Mr Mun compares this operation of
foreign trade to the seed-time and harvest of
agriculture. 'If we only behold,' says he,
'the actions of the husbandman in the seed-time,
when he casteth away much good corn
into the ground, we shall account him rather
a madman than a husbandman. But when we
consider his labours in the harvest, which is
the end of his endeavours, we shall find the
worth and plentiful increase of his actions.'
They represented, secondly, that this prohibition
could not hinder the exportation of gold
and silver, which, on account of the smallness
of their bulk in proportion to their value,
could easily be smuggled abroad. That this
exportation could only be prevented by a proper
attention to what they called the balance
of trade. That when the country exported to
a greater value than it imported, a balance became
due to it from foreign nations, which
was necessarily paid to it in gold and silver,
and thereby increased the quantity of those
metals in the kingdom. But that when it imported
to a greater value than it exported, a
contrary balance became due to foreign nations,
which was necessarily paid to them in
the same manner, and thereby diminished that
quantity: that in this case, to prohibit the exportation
of those metals, could not prevent it,
but only, by making it more dangerous, render
it more expensive: that the exchange was
thereby turned more against the country which
owed the balance, than it otherwise might
have been; the merchant who purchased a
bill upon the foreign country being obliged to
pay the banker who sold it, not only for the
natural risk, trouble, and expense of sending
the money thither, but for the extraordinary
risk arising from the prohibition; but that the
more the exchange was against any country,
the more the balance of trade became necessarily
against it; the money of that country
becoming necessarily of so much less value, in
comparison with that of the country to which
the balance was due. That if the exchange
between England and Holland, for example,
was five per cent. against England, it would
require 105 ounces of silver in England to
purchase a bill for 100 ounces of silver in
Holland: that 105 ounces of silver in England,
therefore, would be worth only 100
ounces of silver in Holland, and would purchase
only a proportionable quantity of Dutch
goods; but that 100 ounces of silver in Holland,
on the contrary, would be worth 105
ounces in England, and would purchase a
proportionable quantity of English goods;