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to notice, because Dr. Smith has, in many other places, insisted on the example of the Portuguese as a proof that the general practice of carrying on the India trade through the medium of a joint stock company is unnecessary. The truth is, that the Portuguese trade with India was a monopoly in the hands of the king and never was open to all his subjects.

The next proposition is little more than a truism, since it is obvious that every exclusive privilege must exclude, from a participation in it, all persons but those on whom it is conferred; and that such a privilege, if conferred as a source of mercantile profit, must be intended to operate at the expense of the buyers. But this is not, in Dr. Smith's opinion, a conclusive objection against monopolies, since he admits that they afford, in some instances, as in the case of authors of the discoveries of useful arts, and of banking insurance companies, the best mode of remuneration. He admits, also, that in the case of any new trade undertaken by a company, the easiest and most natural way in which the state can recompense such an association for a dangerous and expensive experiment is by a temporary monopoly ; and he only contends that, at the expiration of the prescribed period, such monopoly ought to determine. Now the charter of the East India Company has never been granted by parliament but for a limited time, and, at each renewal, has been purchased from the public at a price which the legislature has considered as adequate. It is therefore incumbent upon those who censure these renewals either to prove, generally, that a source of profit given as the most natural equivalent for the possible risks of a new trade cannot afterwards be continued to the possessors on any terms of barter; or, specially, that in this particular instance successive ministers and parliaments have, during nearly a century, always made a most improvident bargain for the community.

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With respect to the extraordinary profits' of the company, if this term be meant to express only those gains which must have been contemplated by the legislature in making the periodical bargains above alluded to, no justification is necessary :-if it be meant to insinuate that these gains are also inordinate, (an accusation which is elsewhere directly stated by Dr. Smith,)

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It may be answered,' (says Mr. Macpherson,) that the company are obliged by law to expose all their goods to public sale, and in lots within the reach of every dealer in moderate circumstances, and that none of them are ever bought in on their own account; so that the buyers have them at prices of their own making. It is also a fact well worthy of serious consideration, that Oriental goods, imported by this monopolizing company, have, for thirty or forty years past, been sold for less nominal money than they were a hundred years ago; whereas

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all other goods, not excepting the produce of the West India islands, the trade of which is entirely open to all British subjects, have advanced to double, triple, or quadruple prices.'

Lastly, as to the extraordinary waste' which is here imputed to the company's servants, it must be conceded that several instances of flagrant mismanagement in India have been formerly brought to light.

During the unsettled period which preceded the acquisition of the Dewannee, (says Mr. Macpherson,) many of the company's servants, and also many British subjects not in their service, were guilty of acts of oppression, violence, and extortion, which must have brought an odium on the national character, if subsequent regulations, strictly enforced, had not convinced the natives that such outrages were prohibited, and would, in future, be effectually prevented by the company." -p. 190.

But from many such instances occurring during the temporary anarchy which followed a sanguinary war, it is not fair to infer the general depravity of a whole community, or to conclude that fraud and abuse are inseparable from the management of the affairs of so great a company. If the trade to India were unrestricted, the number of agents employed there would not, most probably, be diminished, neither would the chances of their integrity be much improved. The liberal education of all the candidates for the company's civil service, the competent provision assigned to them on their arrival, and the high prospects offered to their ambition, afford, it should seem, the best possible security for the honourable discharge of their duty; and the great expense thus incurred in cultivating talent or rewarding merit is, perhaps, not less efficacious in checking extraordinary waste than the most economical expedient which the ingenuity of private traders could devise.

So much for the comprehensive answer to the general charge; but in replying to such an antagonist as Dr. Smith it is necessary to enter upon a fuller and more particular discussion.

It being assumed, on one hand, that monopolies are, in general, mischievous and useless infringements on the freedom of commerce, and, on the other hand, that they are, notwithstanding, admissible in particular cases, the point at issue is, whether the exclusive right of trading to India, exercised, as it now is, ought to be condemned under the rule or justified under the exceptions. And the latter proposition is affirmed by Mr. Macpherson partly on the ground of experience and partly by arguments deduced from the peculiar nature of the trade.

The experiment of a free and open trade with India, has been twice tried in this country; first, after the triumph of the republicans over Charles I. and secondly, soon after the revolution effected

by King William. Both trials, therefore, were begun under the most favourable circumstances, and prosecuted with all the advantage of popular opinion. Both were relinquished with the greatest reluctance; and the latter, after much litigation in parliament, and a long and obstinate controversy through the medium of the press. The period of 1698, indeed, had much resemblance to the present day; a frightful war; a depreciated currency; a spirit of gambling speculation in India, as wild as that of our modern adventurers in South America; numerous bankruptcies, and a failing credit. It may perhaps be objected that the distressing glut of Indian produce, was a transitory evil which, if the free trade had been continued, must have cured itself, and that to revive the joint stock company was an act of gross impolicy, and at variance with the true principles of commerce. To this, however, it is a fair answer that, though our ancestors may have been less wise than ourselves, and therefore less confident in this remedy, they could not be quite ignorant of its being within their reach. They could not but know that a great redundance of any article is usually followed by a proportionate scarcity, which ultimately re-establishes the demand and replaces commerce on its proper footing; but they dreaded a series of these alternations, which they considered, after much inquiry, as inseparable from an open trade, and only to be avoided by the united councils of a company. They had personally endured the misery of a monopoly and the inconveniences of a free trade, and it was after a fair comparison of both that they made their decision. Thus far these two examples, which occur at different periods of our history, are of some value; and as they are the only examples to which we can refer, the appeal to experience must end with them. It therefore now becomes necessary to examine the nature of our traffic with India, and the probable means of extending it by a different and improved management.

The Hindoo, (says Mr. Macpherson,) born and desiring to pass his life in the same country where his ancestors, through a long succession of ages, were born and passed their lives; whose food is rice, whose drink is water or milk, to whom wine or strong drink is an object of abomination; and who, if he strictly acts up to his religious principles, would sooner lay down his own life than put any living creature to death, or permit a morsel of animal food to enter his mouth; whose warm climate renders any clothing, beyond what decency requires, intolerable, and whose light clothing is made by himself and his family from the cotton produced in his own fertile fields; whose customs and religion, to which he adheres with the most inflexible constancy, render utterly inadmissible many articles of enjoyment and comfort, which our habits have rendered almost necessary to our existence, can never have any desire to acquire the produce or manufactures of Europe. Hence it is evident that the exportation of European goods of any kind

must

must be, and must ever remain on a scale very contracted, compared to the population of the country; the demand being, in a great measure, confined to the small handful of Europeans, who are either in the service of the company, or living under their protection; to the degenerate posterity of the Portuguese colonists, to some of the Mahomedan inhabitants, and for jewels and trinkets of exquisite workmanship, to a very small number of the most opulent of the Hindoos.'

If this picture be correct, it seems to follow, that such a country as India, producing all the necessaries of life, and all the luxuries required by the simple habits and moderate desires of its inhabitants, is not very likely to furnish a demand for our commodities at all commensurate with the extravagant expectations very generally entertained; and entertained too, on the authority of the greatest political economist of the age. It is asserted in the essay on the Wealth of Nations, (v. ii. p. 470,) that‘the East Indies offer a market, both for the manufactures of Europe, and for the gold and silver, as well as for several other productions of America, greater and more extensive than both Europe and America put together.' And on another occasion the excess of exports in the reign of King William is represented as having been merely a drop of water in the immense ocean of Indian commerce.' To this hyperbole Mr. Macpherson opposes the following plain statement. On the 25th of November, 1789, the commanders and officers who returned in that year from India, represented to the directors that the markets in India were overstocked, and that they were distres sed, almost to ruin, by the badness of their sales; and prayed for a remission of the duties payable to the company upon their investments. The truth of their allegations being attested by the govern ments of Bengal and Madras, their petition was complied with. On a reference to the accounts, it was found that the annual excess of exports above the usual average, by which this ruinous depression of the markets had been occasioned, was very little more than *£20,000; a sum, surely, not likely to produce an overflow in a very extended commercial ocean.

It appears, then, that the market of India, far from being indefi nitely vast, as it has been frequently represented, is, in point of fact, and from natural causes, very much circumscribed. It may, how ever, as we are assured by many, and even by Dr. Smith, be greatly extended, in due time, by the establishment of colonies. Soldiers, merchants and artizans, (the two former in considerable numbers,) have been, at different times sent to India, but Great Britain has hitherto abstained from transporting thither a single cargo of landholders. If a due number of such persons were provided, and if they could obtain an adequate quantity of unoccupied land, or if they were permitted, after occupying some populous district, to

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reduce

reduce the native inhabitants to slavery, or to displace those inhabitants, and to import negro slaves for the purpose of tillage, it is manifest that these colonists, like those in the West Indies, might become great consumers of British manufactures. But this project is liable to difficulties which, until it shall be farther matured, it is useless to discuss.

The export trade, however, is not singly sufficient to settle our ideas respecting the whole commerce. The Hindoos, though they do not want our manufactures, may probably be willing, and perhaps able, to buy from us a much larger amount of bullion than the company, whose activity is not excited by competition, has hitherto thought fit to supply. It is therefore necessary to inquire into their means of purchase.

The imports from India chiefly consist of—

1st. Piece goods. These, in times of tranquillity, form an important article in our European trade, and the supply of them might probably be capable of being greatly increased. That supply, however, has hitherto always equalled, and usually exceeded the demand. In 1803, for instance, though the number of pieces offered for sale did not amount to a million, more than 270,000 remained unsold. The greatest sales yet known were those of 1800 and 1802, amounting, on a mean of the two, to rather more than a million and a half of pieces, (one moiety of which was furnished by the company, and the other by private merchants,) and yielding about two millions sterling.

2d. Indigo. This article, which is of great importance to our manufactures, was originally produced in India; thence introduced into the Spanish, French, and English settlements in America and the West Indies, in some of which the cultivation and manufactures were carried to the greatest perfection. The island of Jamaica furnished large quantities of indigo, not excelled in quantity to that of Guatimala, till the year 1747, when a heavy tax, imposed by the British government, suddenly reduced the planters to ruin, and for ever extinguished the cultivation in that colony. Carolina, however, still afforded a considerable supply, though of very inferior quality; but when America became an independent and hostile country, the East India Company determined to revive, within their territory, a branch of industry which was no longer exposed to the competition of British colonists. The speculation began in 1779; was conducted with great spirit and skill, and after occasioning an expense to the company of about £80,000, was generously surrendered by them, as a secure source of profit, to their servants in India, and to the merchants under their protection. To obviate the difficulties to which infant establishments are always exposed from an insufficient capital, these planters have been accom

modated

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