contains its full standard weight, the
coinage costs nothing to any body; and if it
is short of that weight, the coinage must always
cost the difference between the quantity
of bullion which ought to be contained in it,
and that which actually is contained in it.
The government, therefore, when it defrays
the expense of coinage, not only incurs some
small expense, but loses some small revenue
which it might get by a proper duty; and
neither the bank, nor any other private persons,
are in the smallest degree benefited by
this useless piece of public generosity.
The directors of the bank, however, would
probably be unwilling to agree to the imposition
of a seignorage upon the authority of a
speculation which promises them no gain, but
only pretends to insure them from any loss.
In the present state of the gold coin, and as
long as it continues to be received by weight,
they certainly would gain nothing by such a
change. But if the custom of weighing the
gold coin should ever go into disuse, as it is
very likely to do, and if the gold coin should
ever fall into the same state of degradation in
which it was before the late recoinage, the
gain, or more properly the savings, of the
bank, in consequence of the imposition of a
seignorage, would probably be very considerable.
The bank of England is the only company
which sends any considerable quantity
of bullion to the mint, and the burden of the
annual coinage falls entirely, or almost entirely,
upon it. If this annual coinage had
nothing to do but to repair the unavoidable
losses and necessary wear and tear of the
coin, it could seldom exceed fifty thousand,
or at most a hundred thousand pounds. But
when the coin is degraded below its standard
weight, the annual coinage must, besides this,
fill up the large vacuities which exportation
and the melting pot are continually making
in the current coin. It was upon this account,
that during the ten or twelve years
immediately preceding the late reformation of
the gold coin, the annual coinage amounted,
at an average, to more than L.850,000. But
if there had been a seignorage of four or five
per cent. upon the gold coin, it would probably,
even in the state in which things then
were, have put an effectual stop to the business
both of exportation and of the melting
pot. The bank, instead of losing every year
about two and a half per cent. upon the bullion
which was to be coined into more than
eight hundred and fifty thousand pounds, or
incurring an annual loss of more than twenty-one
thousand two hundred and fifty pounds,
would not probably have incurred the tenth
part of that loss.
The revenue allotted by parliament for defraying
the expense of the coinage is but fourteen
thousand pounds a-year; and the real
expense which it costs the government, or the
fees of the officers of the mint, do not, upon
ordinary occasions, I am assured, exceed the
half of that sum. The saving of so very small
a sum, or even the gaining of another, which
could not well be much larger, are objects
too inconsiderable, it may be thought, to deserve
the serious attention of government.
But the saving of eighteen or twenty thousand
pounds a-year, in case of an event which
is not improbable, which has frequently happened
before, and which in very likely to happen
again, is surely an object which well deserves
the serious attention, even of so great a
company as the bank of England.
Some of the foregoing reasonings and observations
might, perhaps, have been more
properly placed in those chapters of the first
book which treat of the origin and use of
money, and of the difference between the real
and the nominal price of commodities. But
as the law for the encouragement of coinage
derives its origin from these vulgar prejudices
which have been introduced by the mercantile
system, I judged it more proper to reserve
them for this chapter. Nothing could be more
agreeable to the spirit of that system than a
sort of bounty upon the production of money,
the very thing which, it supposes, constitutes
the wealth of every nation. It is one of its
many admirable expedients for enriching the
country.
CHAP. VII.
OF COLONIES.
PART I.
Of the Motives for Establishing New Colonies.
The interest which occasioned the first settlement
of the different European colonies in
America and the West Indies, was not altogether
so plain and distinct as that which directed
the establishment of those of ancient
Greece and Rome.
All the different states of ancient Greece
possessed, each of them, but a very small territory;
and when the people in any one of
them multiplied beyond what that territory
could easily maintain, a part of them were
sent in quest of a new habitation, in some remote
and distant part of the world; the war-like
neighbours who surrounded them on all
sides, rendering it difficult for any of them to
enlarge very much its territory at home. The
colonies of the Dorians resorted chiefly to
Italy and Sicily, which, in the times preceding
the foundation of Rome, were inhabited
by barbarous and uncivilized nations; those
of the Ionians and Æolians, the two other
great tribes of the Greeks, to Asia Minor and