security of persons and property. By its generously confining its interests to the care of all, the Hanseatic league left the world an honourable remembrance consoling to humanity.

The discovery of America and of a passage to the East Indies by the Cape of Good Hope, the abundance of the precious metals which it caused to circulate in Europe, the general comforts, which were an obvious consequence of this discovery, every circumstance of this ever-memorable event confirmed the opinion respecting foreign commerce, and left no doubt about its being the true source of wealth.

But how does commerce enrich a country? By what channels does it pour its benefits? And how is the productiveness of commerce to be increased and its prosperity insured?

The majority of writers supposed, that foreign commerce enriches a country by the plenty of gold and silver which it causes to circulate ;* and governments, in conformity to this doctrine, endeavoured to retain the precious metals, or to invite them by encouraging national manufactures, by directly or indirectly prohibiting the produce of foreign industry, or by procuring to the produce of national industry,

* We must do the justice to Davenant to confess, that, although a partisan of the mercantile system, he did not limit its advantages to the abundance of precious metals which it accumulates in a country. This justly celebrated author, on the contrary, lays it down as a principle, that every trade is advantageous, provided its returns be more considerable than the goods exported, even though the returns should consist in perishable commodities. Vol. ii. p. 11.

an easy and even privileged introduction into foreign countries. Such was, and such is still, some few modifications excepted, the system which places the source of wealth in foreign commerce; and which, on that account, is called the Mercantile System.

The great estimation in which a gold and silver currency was every where held, naturally led some philosophers to watch its progress, its distribution, its circulation, and, above all, its influence upon private and public concerns; and it was not long before the inconveniencies which might be apprehended, and the advantages which might be expected from it, were discovered.

The Italian writers soon pointed out the vices of the prevailing monetary system, and threw great light upon that important part of the science.

Towards the end of the sixteenth and in the beginning of the seventeenth century, Davanzati at Florence, and Turbolo at Naples, gave excellent instructions on metallic currency. * But their writings proved unavailing against the disorders which they wanted to stop or to prevent. When we peruse these ancient writings, we do not know whether we oughtto be more surprised at the extensive light they throw on the subject which they discuss, or at the small influence they had upon their own times. It is as if their country was to give to the rest of Europe the example of the calamities which result from the dis

* Lezione delle Monete di Bernardo Davanzati. Fiorentino, 1588.-Discorsi et Relazioni sulle Monete del regno di Napoli di Gian Donato Turbulo. Napolitano, 1629.

ordered state of a currency, and of the theory best adapted to avoid such a disorder. Ten very distinguished treatises, published in Italy since the middle of the eighteenth century, by men of powerful understandings and most distinguished for the eminent offices which they had held, attest, at once, the greatness of the evil and the impotance of the remedy.* Existing circumstances have predominated over human combinations, and Italy has always been remarkable for the worst currency and the best works on money.

The English writers were also aware of the obstacles which a vicious monetary system opposes to the progress of wealth; but the measures pointed out by Locke and Newton, remedied the evil in England, and the Bank subsequently contributed to guard against its recurrence.†

It appears, that before the middle of the eighteenth century, the French had not paid any serious attention to their monetary system. In vain did the people complain against its defects; in vain did they submit to the greatest sacrifices; their complaints were listened to, their sacrifices accepted, but recourse was

* Montaneri, Broggia, Galiani, Neri, Carli, Genovesi, Beccaria, Bandini, Vasco, et Corniani.

To this praise the Bank of England, unfortunately, has no loner any claim, since its late issue of bank tokens, worth scarcely two shillings and sixpence, at three shillings: so that the same quantity of silver as was formerly contained in fifty shillings, now represents sixty. See the Speech of Mr. Johnstone, on the third reading of Lord Stanhope's Bill. Booker, 1811.-T.

had to mere temporary measures, which are always impotent against urgent evils. Statesmen were even inclined to fancy the calamity less than it was pretended to be; their ignorance stifled their remorses; and we shall presently find, that he who first wrote on that subject in France, although a very enlightened man in other respects,* firmly believed the evil which was complained of, to be merely imaginary, and to have no way impaired either public or private wealth. Can we wonder after this, at the slow progress of wealth in France,-in a country where it ought to have surpassed that of all other nations, had her inhabitants known how to avail themselves of her natural advantages?

While, in Italy, philosophers were endeavouring to regulate the circulating medium of gold and silver, and in France every regulation was imprudently derided, a more particular attention was paid in Eng land to the influence of the medium of exchange upon wealth; and some English writers† did not hesitate to maintain that wealth depended on the lowering of the interest of money, were it even forced.

The exaggeration of this opinion did not tend to its discredit; it was faithfully followed in England for nearly two centuries, and it constantly regulated the views, determinations, and financial measures of her legislature and government. Her bank, her sinking fund, her public credit, are all built upon the principle of the utility of lowering the interest of money.

* Melon, Essai Politique sur le Commerce en 1734.

+ Thomas Culpeper, Sir Josiah Child, Locke, Paterson, and Barnard.

This doctrine, which was introduced in France by the famous Law, was as fatal to that country as it had proved beneficial to England; and the reason of this difference is easily perceived. When Thomas Culpeper in 1641, Sir Josiah Child in 1670, Raterson in 1694, Locke in 1700, and Barnard in 1714, solicited the lowering of the rate of interest, public opinion had already anticipated their efforts. The interest of money had been lowered in all private transactions, and the law did nothing but countenance the general disposition of the people,

The case was widely different in France. When Law proposed to lower the rate of interest by indirect and forced means, confidence was destroyed, the discredit general, and money hoarded; it could scarcely be had even at the highest interest.

The two countries were in a totally different situation, and by an infallible consequence, the measure which succeeded in England, failed, and must necessarily have failed, in France, where it produced the most disastrous effects, and formed one of the most lamentable periods of the history of her wealth. May this event be a lesson to all governments, and guard them against absolute principles in political economy, and, above all, against specifics which the science disclaims, and which are an insult to reason!

Shaken in its very foundations by the doctrine of the forced lowering of the rate of interest, and by an excessive paper-circulation, wealth, in France, had no longer any solid basis, fixed principle, or steady direction. Though it was still supposed to have its source