but he did not go so far as to say that they were of no utility, and that nations might grow rich without their assistance. It is however difficult to separate the two ideas; and if it were clearly demonstrated, that nations cannot arrive at wealth but by means of gold and silver, it could not easily be supposed that their plenty or scarcity has no influence upon wealth. Let us, therefore first inquire, whether the wealth of nations is entirely independent of gold and silver, or how far it depends upon these metals ?

Before gold or silver coin is introduced in any coun try, exchanges are made in material commodities, but not beyond the place where they are produced. The surplus of agricultural produce is carried to the next town, and the produce of the industry of the town is consumed in the neighbouring hamlets or villages.

The home-trade does not go beyond each town and its district; it has neither motives por means to leave this narrow sphere, to look at a distance for a more advantageous sale of its commodities, and of course it never exceeds the ordinary wants of the country. In such a state of things desires are confined within wants, and to labour to satisfy them is the limit of the efforts and ambition of all. *

* Three things, says Genovesi, have led mankind to conimerce; the natural love of self-preservation, the desire of the conveniencies of life and wealth, and the pleasures of luxury. The first produces but a rare and scanty commerce, because necessaries are generally furnished by the country, and foreign countries contribute very little to the supply of wants of that kind. The second produces a little more commerce, because the number and variety of conveniencies are great, and cannot all be produced by the same soil. The third is the cause of an infinite commerce, because pleasures and luxury have no end,

Should people even succeed in creating a local money of the nature of those enumerated by Adam Smith,* such money would not impart great activity to the circulation of productions, and would not extend commercial relations very far. Brittle or perishable, of difficult or expensive conveyance, destitute of any particular or general attraction, it would be little sought for, and could content neither individual avarice nor national ambition. Consequently it would leave things in the state in which they were before its existence, and it is difficult to conceive how they could be mended by its assistance.

This theory is fully confirmed by history. The hordes and tribes of savages discovered in the inte'rior of Africa and in some parts of Asia and America, that were destitute of gold and silver coins, though they had other money, were yet plunged into extreme indigence and misery, and all accounts of travels and voyages afford scarcely a single exception to this general fact.

But no sooner are gold and silver introduced in any country, than the wish of possessing them excites the desires of the inhabitants, sets labour, industry and commerce in motion, and developes the energies, faculties, and talents of every individual member of the nation. The incorruptibility of the finer metals, their divisibility, the facility with which they may be kept and concealed from all eyes, or displayed and conveyed any where, with the certainty of procuring by their means any desirable commodity or enjoyment, cause them to be sought for; and the desires which they inspire are unlimited, because imagination magnifies the gratifications which gold and silver are able to purchase.

The internal trade, or circulation, (says Mengotti in his Essay on the Commerce of the Romans, which was crowned by the Academy of Sciences at Paris in 1789,) must have been slow and extremely languid without the impulse of gold and silver coin, which is the soul of industry and commerce.

* Wealth of Nations, vol. i. book i. chap. 4.

It therefore appears certain, that gold and silver are necessary to the formation of wealth, and that without them wealth cannot possibly exist.*

Their necessity being thus demonstrated, it follows evidently that their plenty or scarcity cannot be indifferent to the progress of wealth. Their scarcity causes them to be horded, concentrated among a small number of individuals, and renders them as it were strangers to the generality of the people. To the classes that cannot partake of them it is as if they were not; they have of course no influence


their labour, industry, and talents. Some one has observed, very justly in my opinion, that the first guinea is more difficult to earn than the second million; and I think I am not mistaken, when I add that the difficulty of

Money, in a word, is the most universal incitement, iron the most powerful instrument of human industry; and it is very

difficult to conceive by what mcans a people, neither actuated by the one nor seconded by the other, could emerge from the

grossest barbarism, Gibbon's Decline and Fall of the Roman Empire, chap. ix.

earning the first guinea is the greatest obstacle that can be thrown in the way of labour, industry, and commerce. As little as diamonds and precious stones, the trappings of opulence, have ever tempted the ambition of the labouring and industrious classes, or increased the labour and industry of any people, as little would gold and silver, reserved exclusively for the rich, have any influence upon the labouring and industrious classes.

When, on the contrary, a gold and silver currency is so plentiful that, without being depreciated, it gets within the reach of any individual that chooses to labour, the most careless are stimulated by the desire of getting money, and all redouble their efforts to obtain a quantity equal or superior to what is possessed by their equals. Ornaments of gold and silver, the price of which is neither so low that any one might get them, nor so high as to be exclusively reserved for the rich, form one of the most powerful incitements to labour, because they gratify the vanity of the labouring classes. Every production of industry that is within the reach of the least favoured classes, partakes of this property of gold and silver, and it would not be beneath the care of an enlightened

government to turn the efforts of industry to cheap cominodities rather than to the expensive frivolities of opulence ; the progress of riches would be so much the more rapid, and national wealth would receive a new impulse from individual comforts.

We may, therefore, conclude, with some degree of certainty, that a gold and silver currency is the first and most powerful stimulus to labour, industry, and wealth; that this stimulus is weaker in proportion as money is scarce and circulates less freely among the labouring classes, * and stronger in proportion as money is plentiful and widely diffused among the labourers.

But whatever importance I may assign to gold and silver, and although I am inclined to believe that their plenty has the greatest influence upon wealth ; yet it would not be reasonable to infer, that wealth depends on the fecundity or sterility of gold and silver mines; and that those authors, who considered gold and silver as the only wealth, were not so very wrong. There is a great difference between the two systems; they do not approximate in any respect. According to one system, the precious metals are only means to acquire 'wealth ; according to the other, they are the end, or wealth itself. Vain, therefore, would be the attempt to assimilate them, and to confound one with the other,

In vain does Adam Smith himself observe," that to attempt to increase the wealth of any country,

* In every kingdom into which money begins to fów in greater abundance than formerly, every thing takes a new face : labour and - industry gain life.--Hume's Essays ; Edinb. 1804 ; vol. i. of


page 303.

7. That an increase of the circulating medium tends to afford temporary encouragement to industry, seems to be proved by the effects of the Mississipi Scheme in France ; for it is affirmed by French wri.. ters, that the notes of Mr. Law's bank appeared for a time to have a very powerful influence in extending the demand for labour, and in augmenting the visible and bond fide property of the kingdom. Mr. Henry Thornton on Paper Credit, page 263.-T.

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