by means of his public character, interfere
with more authority and afford them a more
powerful protection than they could expect
from any private man. The interests of
commerce have frequently made it necessary
to maintain ministers in foreign countries,
where the purposes either of war or alliance
would not have required any. The commerce
of the Turkey company first occasioned the
establishment of an ordinary ambassador at
Constantinople. The first English embassies
to Russia arose altogether from commercial
interests. The constant interference with
those interests, necessarily occasioned between
the subjects of the different states of Europe,
has probably introduced the custom of keeping,
in all neighbouring countries, ambassadors
or ministers constantly resident, even in
the time of peace. This custom, unknown to
ancient times, seems not to be older than the
end of the fifteenth, or beginning of the sixteenth
century; that is, than the time when
commerce first began to extend itself to the
greater part of the nations of Europe, and
when they first began to attend to its interests.
It seems not unreasonable, that the extraordinary
expense which the protection of any
particular branch of commerce may occasion,
should be defrayed by a moderate tax upon
that particular branch; by a moderate fine,
for example, to be paid by the traders when
they first enter into it; or, what is more
equal, by a particular duty of so much per
cent. upon the goods which they either import
into, or export out of, the particular
countries with which it is carried on. The
protection of trade, in general, from pirates
and freebooters, is said to have given occasion
to the first institution of the duties of customs.
But, if it was thought reasonable to
lay a general tax upon trade, in order to defray
the expense of protecting trade in general,
it should seem equally reasonable to lay
a particular tax upon a particular branch of
trade, in order to defray the extraordinary
expense of protecting that branch.
The protection of trade, in general, has
always been considered as essential to the
defence of the commonwealth, and, upon that
account, a necessary part of the duty of the
executive power. The collection and application
of the general duties of customs,
therefore, have always been left to that power.
But the protection of any particular branch
of trade is a part of the general protection of
trade; a part, therefore, of the duty of that
power; and if nations always acted consistently,
the particular duties levied for the
purposes of such particular protection, should
always have been left equally to its disposal.
But in this respect, as well as in many others,
nations have not always acted consistently;
and in the greater part of the commercial
states of Europe, particular companies of
merchants have had the address to persuade
the legislature to entrust to them the performance
of this part of the duty of the sovereign,
together with all the powers which are
necessarily connected with it.
These companies, though they may, perhaps,
have been useful for the first introduction
of some branches of commerce, by
making, at their own expense, an experiment
which the state might not think it prudent to
make, have in the long-run proved, universally,
either burdensome or useless, and have
either mismanaged or confined the trade.
When those companies do not trade upon a
joint stock, but are obliged to admit any person,
properly qualified, upon paying a certain
fine, and agreeing to submit to the regulations
of the company, each member trading upon
his own stock, and at his own risk, they are
called regulated companies. When they trade
upon a joint stock, each member sharing in
the common profit or loss, in proportion to his
share in this stock, they are called joint-stock
companies. Such companies, whether regulated
or joint-stock, sometimes have, and sometimes
have not, exclusive privileges.
Regulated companies resemble, in every respect,
the corporation of trades, so common in
the cities and towns of all the different countries
of Europe; and are a sort of enlarged
monopolies of the same kind. As no inhabitant
of a town can exercise an incorporated
trade, without first obtaining his freedom in
the incorporation, so, in most cases, no subject
of the state can lawfully carry on any branch
of foreign trade, for which a regulated company
is established, without first becoming a
member of that company. The monopoly is
more or less strict, according as the terms of
admission are more or less difficult, and according
as the directors of the company have
more or less authority, or have it more or less
in their power to manage in such a manner as
to confine the greater part of the trade to themselves
and their particular friends. In the
most ancient regulated companies, the privileges
of apprenticeship were the same as in
other corporations, and entitled the person
who had served his time to a member of the
company, to become himself a member, either
without paying any fine, or upon paying a
much smaller one than what was exacted of
other people. The usual corporation spirit,
wherever the law does not restrain it, prevails
in all regulated companies. When they have
been allowed to act according to their natural
genius, they have always, in order to confine
the competition to as small a number of persons
as possible, endeavoured to subject the
trade to many burdensome regulations. When
the law has restrained them from doing this,
they have become altogether useless and insignificant.
The regulated companies for foreign commerce
which at present subsist in Great Britain,