Of the Chief Causes of the Decay of Trade in England and Fall of the Rents of Land

The Two Chief Causes of the Decay of Trade, are the many Prohibitions and high Interest.

The Prohibition of Trade, is the Cause of its Decay; for all Forreign Wares are brought in by the Exchange of the Native: So that the Prohibiting of any Foreign Commodity, doth hinder the Making and Exportation of so much of the Native, as used to be Made and Exchanged for it. The Artificers and Merchants, that Dealt in such Goods, lose their Trades; and the Profit that was gained by such Trades, and laid out amongst other Traders, is Lost. The Native Stock for want of such Exportation, Falls in Value, and the Rent of the Land must Fall with the Value of the Stock.

The common Argument for the Prohibiting Foreign Commodities, is, That the Bringing in, and Consuming such Foreign Wares, hinders the Making and Consuming the like sort of Goods of our own Native Make and Growth; therefore Flanders-Lace, French-Hats, Gloves, Silks, Westphalia-Bacon, &c. are Prohibited, because it is supposed, they hinder the Consumption of English-Lace, Gloves, Hats, Silk, Bacon, &c. But this is a mistaken Reason, and ariseth by not considering what it is that Occasions Trade. It is not Necessity that causeth the Consumption, Nature may be Satisfied with little; but it is the wants of the Mind, Fashion, and desire of Novelties, and Things scarce, that causeth Trade. A Person may have English-Lace, Gloves, or Silk, as much as he wants, and will Buy no more such; and yet, lay out his Mony on a Point of Venice, Jessimine-Gloves, or French-Silks; he may desire to Eat Westphalia-Bacon, when he will not English; so that, the Prohibition of Forreign Wares, does not necessarily cause a greater Consumption of the like sort of English.

Besides, There is the same wants of the Mind in Foreigners, as in the English; they desire Novelties; they Value English-Cloth, Hats, and Gloves, and Foreign Goods, more than their Native make; so that, tho' the Wearing or Consuming of Forreign Things, might lessen the Consuming of the same sort in England; yet there may not be a lesser Quantity made; and if the same Quantity be made, it will be a greater Advantage to the Nation, if they are Consumed in Foreign Countries, than at Home; because the Charge, and Imploy of the Freight, is Gained by it, which in bulky Goods, may be a Fourth Part of the whole Value.

The particular Trades that expect an Advantage by such Prohibition, are often mistaken; For if the Use of most Commodities depending upon Fashion, which often alters; The Use of those Goods cease. As to Instance, Suppose a Law to Prohibit Cane-Chairs; It would not necessarily follow, That those that make Turkey-Work Chairs, would have a better Trade. For the Fashion may Introduce, Wooden, Leather, or Silk Chairs, (which are already in Use amongst the Gentry, The Cane-Chairs being grown too Cheap and Common) or else, they may lay aside the Use of all Chairs, Introducing the Custom of Lying upon Carpets; the Ancient Roman Fashion; still in Use amongst the Turks, Persians, and all the Eastern Princes.

Lastly, If the Suppressing or Prohibiting of some sorts of Goods, should prove an Advantage to the Trader, and Increase the Consumption of the same sort of our Native Commodity: Yet it may prove a Loss to the Nation. For the Advantage to the Nation from Trade, is, from the Customs, and from those Goods that Imploys most Hands. So that, tho' the Prohibition may Increase, as the Consumption of the like sort of the Native; yet if it should Obstruct the Transporting of other Goods which were Exchanged for them, that Paid more Custom, Freight, or Imployed more Hands in making; The Nation will be a loser by the Prohibition: As to Instance, If Tobacco or Woollen-Cloth were used to Exchange for Westphaly-Bacon, The Nation loseth by the Prohibition, tho' it should Increase the Consumption of English-Bacon; because the First, Pays more Freight, and Custom; and the Latter, Imploys more Hands. By this Rule it appears, That the Prohibiting of all unwrought Goods, such as raw Silk, Cotton, Flax, &c. and all Bulky Goods; such as Wines, Oyls, Fruits, &c. would be a Loss to the Nation; because nothing can be sent in Exchange that Imploys fewer Hands than the First, or Pays greater Freight than the Latter.

It doth not alter the Case, If the Ballance of the Account, or all the Foreign Goods, were bought by Silver or Gold; For Silver and Gold, are Foreign Commodities; Pay but little Freight, and Imploy but few Hands in the Working; And are at First brought into England, by the Exchange of some Native Goods, and having Paid for their coming hither, must Pay for the Carriage out. It is true, That if our Serge, Stuffs, or Cloth, are Exchanged for Unmanufactured Goods, it would be a greater Advantage to the Nation, because of the difference in Number of Hands in the making of the First, and the Later.

But all Trading Countries Study their Advantage of Trade, and Know the difference of the Profit by the Exchange of wrought Goods, for un-wrought: And therefore, for any Nation to make a Law to Prohibit all Foreign Goods, but such only as are most Advantageous; Is to put other Nations upon making the same Laws; and the Consequence will be to Ruine all Foreign Trade. For the Foundation of all Foreign Trade, is, from the Exchange of the Native Commodities of each Country, for one another.

To Conclude, If the bringing in of Foreign Goods, should hinder the making and consuming of the Native, which will very seldom happen; this disadvantage is not to be Remedied by a Prohibition of those Goods;

but by Laying so great Duties upon them, that they may be always Dearer than those of our Country make: The Dearness will hinder the common Consumption of them, and preserve them for the Use of the Gentry, who may Esteem them, because they are Dear; and perhaps, might not Consume more of the English Growth, were the other not Imported. By such Duties, the Revenue of the Crown, will be Increased; And no Exceptions can be taken by any Foreign Prince, or Government; Since it is in the Liberty of every Government, To Lay what Duty or Imposition they please. Trade will continue Open, and Free; and the Traders, Enjoy the Profit of their Trade: The Dead Stock of the Nation, that is more than can be Used, will be Carried off, which will keep up the Price of the Native Stock, and the Rent of the Land.

The next Cause of the Decay of Trade in England, and the Fall of Rents, is, That Interest is higher in England, than in Holland, and other places of great Trade: It is at Six per Cent. in England, and at Three in Holland; For all Merchants that Trade in the same sort of Goods, to the same Ports, should Trade by the same Interest.

Interest is the Rule of Buying and Selling: And being higher in England, than in Holland; The English Merchant Trades with a Disadvantage, because he cannot Sell the same sort of Goods in the same Port, for the same Value as the Dutch Merchant. The Dutch Merchant can Sell 100 l. worth of Goods, for 103 l. And the English Merchant must Sell the same sort, for 106 l. to make the same Account of Principal and Interest.

When Sir Thomas Gresham had almost the sole Trade of Spain, and the Turky-Company the sole Selling of Cloth into Turky, and several other places; The Difference of Interest was then, no prejudice to Trade, tho' Interest was then in England, at Eight per Cent. Because, whoe're has the sole Trade to a place, may set what Price he pleaseth upon his Goods: But now, Trade is dispersed, the same sort of Manufacture, is made in several Countries. The Dutch and English Merchants, Trade in the same sort of Goods, to the same Forreign Parts, and therefore they ought to Deal by the same Interest, which is the Measure of Trade.

Besides, And the English Merchant hath the same Disadvantage in the Return of the Goods he Buys; for the Dutch Merchant making his Return in the same sort of Goods, can under-Sell him.

By this Difference of Interest, Holland is become to be the great

Magazine, and Store-House of this Part of Europe, for all sorts of Goods: For they may be laid up Cheaper in Holland, than in England.

It is impossible for the Merchant when he has Bought his Goods, To know what he shall Sell them for: The Value of them, depends upon the Difference betwixt the Occasion and the Quantity; tho' that be the Chiefest of the Merchants Care to observe, yet it Depends upon so many Circumstances, that it's impossible to know it. Therefore if the plenty of the Goods, has brought down the Price; the Merchant layeth them up, till the Quantity is consumed, and the Price riseth. But the English Merchant, cannot lay up his, but with Disadvantage; for by that time, the Price is risen so as to pay Charges and Interest at Six per Cent. the same Goods are sent for from Holland, and bring down the Price: For they are laid up there, at Three per Cent, and can therefore be Sold Cheaper.

For want of Considering this, in England, many an English Merchant has been undone; for, though by observing the Bill of Lading, he was able to make some Guess of the Stock that was Imported here; and therefore, hath kept his Goods by him for a Rise: But not knowing what Stock there was in Holland, hath not been able to sell his Goods to Profit, the same Goods being brought from thence before the Price riseth high enough to pay Ware-House-Room, and Interest.

So that, now the great part of the English Trade is driven by a quick Return, every Day Buying and Selling, according to a Bill of Rate every day Printed. By this Means, the English Trade is narrowed and confined, and the King loseth the Revenue of Importation, which he would have, if England were the Magazine of Europe; and the Nation loseth the Profit, which would arise from the Hands imploy'd in Freight and Shipping.

Interest being so high in England, is the Cause of the Fall of Rents; for Trade being confined to a Quick Return: And the Merchant being not able to lay up Foreign Goods, at the same Interest as in Holland, he Exports less of the Native; and the Plenty of the Native Stock Brings down the Rent of Land; for the rest of the Land that produceth the Stock, must fall, as the Price of the Stock doth.

Whereas, if Interest were at the same Rates as in Holland, at Three per Cent. it would make the Rent more certain, and raise the Value of the Land.

This Difference of Three per Cent. is so Considerable, that many

Dutch Merchants Living in Holland, having Sold their Goods in England; give Order, to put out their Stock to Interest in England; thinking That a better Advantage than they can make by Trade.

It will raise the Rent of some Estates, and preserve the RRent of others: For the Farmer must make up his Account, as the Merchant doth; the Interest of the Stock, must be reckoned, as well as the Rent of Land: Now if the Farmer hath 300 l. Stock, upon his Farm, that is so easily Rented, that he Lives well upon it; he may add 9 l. per Annum more to the Rent, when the Interest is at Three per Cent. and make the same Account of Profit from the Farm: As he doth now Interest, is at Six per Cent. And those Farmers that are hard Rented, having the same Stock, will have 9 l. per Annum Advance in the Account, towards the Easing the Rent: For altho' the Farmer gets nothing more at the Years end, yet in making up of Account, there must 9 l. add to the Value of Land, and taken from the Account of the Stock. If Interest were at Three per Cent. there would always be a Magazine of Corn and Wooll in England, which would be a great Advantage to the Farmer, and make his RRent more certain; for there are Years of Plenty, and Scarcity; and there are more Farmers undone by Years of great Plenty, than Recover themselves in Years of Scarcity; for when the Price is very low, the Crop doth not pay the Charge of Sowing, Farming, and Carrying to Market; and when it is Dear, It doth not fall to all Mens Fortune that were losers by Plenty, to have a Crop: Now if Interest were at Three per Cent. Corn and Wooll in Years of great Plenty, would be Bought and Laid up to be Sold in Years of Scarcity. The Buying in Years of Plenty, would keep the Price from Falling too Low; and the Selling in Years of Scarcity, would prevent it from Rising too High; by this means, a moderate Price, being best upon Corn and Wooll; the Farmers Stock and Rent of the Land, would be more certain.

But now Holland being the great Magazine of Corn, Man will Lay up any considerable Quantity in England at Six per Cent. when he may always Buy as much as he wants, that was Laid up at Three per Cent. and may bring it from thence, as Soon, and as Cheap, into any Parts of England, as if it were Laid up here.

Thirdly, If Interest were at Three per Cent. the Land of England, would be worth from Thirty Six, to Forty Years Purchase; for Interest, sets the Price in the Buying and Selling of Land.

The bringing down of Interest, will not alter the Value of other Wares; for the Value of all Wares, arriveth from their Use; and the Dearness and Cheapness of them, from their Plenty and Scarcity: Nor will it make Mony more Scarce. For if the Law allow no more Interest, than Three per Cent. they that Live upon it, must Lend at that rate, or have no Interest; for they cannot put it forth any where else to better Advantage. But if it be supposed, That it may make Mony scarce, and that it may be a Prejudice to the Government, who want the Advance of the Mony; It may be provided for, by a Clause, that all that Lend Mony to the King, shall have 6 l. per Cent.; such Advantage would make all Men Lend to the Government: And the King will save two per Cent. by such a Law.

The seeming Prejudice from such a Law, is, It will lessen the Revenue of those who live upon Interest: But this will not be a General Prejudice; for many of those Persons have Land as well as Mony, and will get as much by the Rise of one, as by the Fall of the other. Besides, many of them, are Persons that live Thriftily, and much within the Compass of their Estates; and therefore, will not want it, but in Opinion. They have had a long Time, the Advantage of the Borrower; for the Land yielding but 4 l. per Cent. and the Interest being at 6 l. per Cent. a new Debt is every Year contracted of 2 l. per Cent. more than the Value of the Debt in Land will pay, which hath Devoured many a good Farm; and eat up the Estates of many of the Ancient Gentry of England.

Moses, that Wise Law-Giver, who designed, that the Land, divided amongst the Jews, should continue in their Families; forbid the Jews to pay Interest, well knowing that the Merchants of Tyre, who were to be their near Neighbours, would, by Lending Mony at Interest, at last get their Lands: And that this seems to be the Reason, is plain; For the Jews might take Interest of Strangers, but not pay; for by taking Interest, they could not lose their Estates.

The Lawyers have invented Intails, to preserve Estates in Families; and the bringing down of Interest to Three per Cent. will much help to continue it; because the Estates being raised to double the Value, will require double the Time, after the same Proportion of Expence to Consume it in.

The raising the Value of Land, at this Time, seems most necessary, when the Nation is Engaged in such a Chargeable War: For the Land is the Fund that must support and preserve the Government; and the Taxes will be lesser and easier payd; for they will not be so great: For 3 sh. in the Pound, is now 133% Part of every Mans Estate in Land, reckoning at Twenty Years Purchase. But if the Value of the Land be doubled, it will be the 226 Part of the Land, which may be much easier born.

Campinella, who Wrote an 100 years since, upon considering of the great Tract of the Land of France; says, That if ever it were United under one Prince, it would produce so great a Revenue; It might give Law to all Europe.15

The Effect of this Calculation, Is since, seen by the Attempts of this present King of France: And therefore, since England is an Island, and the Number of Acres cannot be Increased; It seems absolutely necessary, That the Value of them, should be raised to Defend the Nation against such a Powerful Force: It will be some Recompence to the Gentry, whose Lands must bear the Burthen of the War, to have the Value of their Estates Raised; which is the Fund and Support of the Government; Is a great Advantage to the whole Nation; and it's the greater, because it doth not Disturb, Lessen, nor Alter the Value of any Thing else.

15. "Th. Campenella de Monarchia Hispania." Editio novissima, aucta et emendata ut praefatio ad lectorem indicat (Amsterodami, 1653); see chap. XXIV (De Gallia), p. 187.

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