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nually decay in proportion to this deficiency. CHA P.. The expence of the fociety in this cafe exceeds its revenue, and neceffarily encroaches upon its capital. Its capital, therefore, must neceffarily decay, and, together with it, the exchangeable value of the annual produce of its industry.

THIS balance of produce and consumption is entirely different from, what is called, the balance of trade. It might take place in a nation which had no foreign trade, but which was entirely separated from all the world. It may take place in the whole globe of the earth, of which the wealth, population, and improvement may be either gradually increafing or gradually decaying.

THE balance of produce and confumption may be constantly in favour of a nation, though what is called the balance of trade be generally against it. A nation may import to a greater value than it exports for half a century, perhaps, together; the gold and filver which comes into it during all this time may be all immediately fent out of it; its circulating coin may gradually decay, different forts of paper money being fubftituted in its place, and even the debts too which it contracts in the pricipal nations with whom it deals, may be gradually increasing; and yet its real wealth, the exchangeable value of the annual produce of its lands and labour, may, during the fame period, have been increasing in a much greater proportion. The ftate of our. North American colonies, and of the trade which they carried on with Great Britain, before

the

BOOK the commencement of the prefent disturbances

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may serve as a proof that this is by no means an impoffible fuppofition.

MER

ERCHANTS and manufacturers are not contented with the monopoly of the home market, but defire likewise the most extenfive foreign fale for their goods. Their country has no jurifdiction in foreign nations, and therefore can feldom procure them any monopoly there. They are generally obliged, therefore, to content themselves with petitioning for certain encouragements to exportation.

Of these encouragements what are called Drawbacks feem to be the most reasonable. To allow the merchant to draw back upon exportation, either the whole or a part of whatever excife or inland duty is impofed upon domestic industry, can never occafion the exportation of a greater quantity of goods than what would have been exported had no duty been impofed. Such encouragements do not tend to turn towards any particular employment a greater share of the capital of the country, than what would go to that employment of its own accord, but only to hinder the duty from driving away any part of

This paragraph was written in the year 1775

that

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that share to other employments. They tend CHA P. not to overturn that balance which naturally establishes itself among all the various employments of the fociety; but to hinder it from being overturned by the duty. They tend not to deftroy, but to preferve, what it is in moft cafes advantageous to preferve, the natural divifion and distribution of labour in the fociety.

THE fame thing may be faid of the drawbacks upon the re-exportation of foreign goods im-, ported; which in Great Britain generally amount to by much the largest part of the duty upon importation. By the fecond of the rules, annexed to the act of parliament, which impofed, what is now called, the old fubfidy, every merchant, whether English or alien, was allowed to draw back half that duty upon exportation; the English merchant, provided the exportation took place within twelve months; the alien, provided it took place within nine months. Wines, currants, and wrought filks were the only goods which did not fall within this rule, having other and more advantageous allowances. The duties imposed by this act of parliament were, at that time, the only duties upon the importation of foreign goods. The term within which this, and all other drawbacks, could be claimed, was afterwards (by 7 Geo. I. chap. 21. fect, 10.) extended to three years.

THE duties which have been impofed fince the old fubfidy, are, the greater part of them, wholly drawn back upon exportation. This general rule, however, is liable to a great number

of

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BOOK of exceptions, and the doctrine of drawbacks has become a much lefs fimple matter, than it was at their firft inftitution.

UPON the exportation of fome foreign goods, of which it was expected that the importation would greatly exceed what was neceffary for the home confumption, the whole duties are drawn back, without retaining even half the old fubfidy. Before the revolt of our North American colonies, we had the monopoly of the tobacco of Maryland and Virginia. We imported about ninety-fix thousand hogfheads, and the home confumption was not fuppofed to exceed fourteen thoufand. To facilitate the great exportation which was neceffary, in order to rid us of the reft, the whole duties were drawn back, provided the exportation took place within three years.

We still have, though not altogether, yet very nearly, the monopoly of the fugars of our West Indian Inlands. If fugars are exported within a year, therefore, all the duties upon importation are drawn back, and if exported within three years, all the duties, except half the old fubfidy, which ftill continues to be retained upon the exportation of the greater part of goods. Though the importation of fugar exceeds, a good deal, what is neceffary for the home confumption, the excefs is inconfiderable, in comparison of what it used to be in tobacco.

SOME goods, the particular objects of the jealousy of our own manufacturers, are prohibited to be imported for home confumption. They may,

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may, however, upon paying certain duties, be CHAP. imported and warehoused for exportation. But upon fuch exportation, no part of thefe duties are drawn back. Our manufacturers are unwilling, it feems, that even this reftricted importation fhould be encouraged, and are afraid left fome part of thefe goods fhould be ftolen out of the warehouse, and thus come into competition with their own. It is under these regu lations only that we can import wrought filks, French cambrics and lawns, callicoes painted, printed, ftained, or dyed, &c.

WE are unwilling even to be the carriers of French goods, and choose rather to forego à profit to ourselves, than to suffer those, whom we confider as our enemies, to make any profit by our means, Not only half the old fubfidy, but the fecond twenty-five per cent., is retained upon the exportation of all French goods.

By the fourth of the rules annexed to the old fubfidy, the drawback allowed upon the exportation of all wines amounted to a great deal more than half the duties which were, at that time, paid upon their importation; and it seems, at that time, to have been the object of the legiflature to give fomewhat more than ordinary encouragement to the carrying trade in wine. Several of the other duties too, which were impofed, either at the fame time, or fubfequent to the old fubfidy; what is called the additional duty, the new fubfidy, the one-third and twothirds fubfidies, the impoft 1692, the coinage on wine, were allowed to be wholly drawn back upon