partial, that the cause of the debtor is the most favourable, took its rise; and it may easily be supposed that from that instant private credit vanished or manifested itself only with precautions and simulations calculated to balance the favour shewn to the debtor. Every page of the Roman code of laws exhibits a struggle between the law and the creditor, and the efforts of the legislator to protect the debtor against the arts and devices of his creditor.

When the nations of modern Europe became acquainted with and adopted the Roman law, or introduced its spirit into their customs, they were exactly in the same situation as the Romans under the emperors. The feudal barons oppressed the people and balanced the authority of the monarch. Kings were therefore as interested in lowering the feudal barons, as the emperors in weakening the patricians; and the same interest induced the kings, as it had done the emperors, to cultivate the affection of the people. The maxim, that the cause of the debtor is the most favourable, necessarily crept into the code of modern nations, from the same motive which had introduced it into the Roman law. Hence it is found in almost all codes of laws, even in those which do most honour to human reason, and which by the purity of their motives are best calculated to forward the happiness of man and the improvement of the hu

man race.

But a maxim excellent for times of oppression and robbery, in oligarchical governments and under the sway of a small number of wealthy individuals, is no longer suitable to a social order built upon the equality

of civil and political rights, which recognizes labour as the source of comforts, the circulation of its produce as the promoter of public prosperity, and general wealth as the basis of strength and power. In this system every one labours, economizes, and lends his savings merely for equivalents that please and suit him, and only as far as he is sure to be put in possession of those equivalents at the time when the commodity which he has lent is to be restored to him. The limitation of the equivalent and the difficulty of having the loan returned are as many obstacles to private credit, to individual savings, to the undertakings which these savings promote or favour, to the increase of population and produce, and to the progress of national wealth.

Let governments remove obstacles so unworthy of the present state of knowledge, so injurious to their glory, so averse to their power. Let them allow the lender and borrower to stipulate what conditions they think fit; let them watch over the performance of their stipulations; and, above all, let the execution of the law be stripped of the delays and costs with which it is obstructed, and which often render its execution impossible; and private credit will take a rapid flight and be the parent of incalculable benefits.

Public credit in many respects resembles private credit, and might truly be pronounced a mere branchof it. Both circulate private savings, and neither can obtain these savings but by offering an equivalent agreeable or suitable to the lender, and insuring him the restitution of his property; but they differ in so

far as the savings put in circulation by private credit contribute almost all to increase the mass of productive labour; while those circulated by public credit contribute almost all to a mere additional expence, and of course serve only to increase consumption. A difference which has already been noticed and appreciated.

However, it must be confessed, that whenever the necessity of additional expence is obvious, public credit affords the least burthensome resource of all those that could be devised to pay for that expence.

After having attentively followed credit from its source, in its various branches, and up to its most minute ramifications; after having seen it, like a bountiful river, carrying every-where activity, fertility, and abundance, freeing circulation from the costly use of coin, and reserving it for the undertakings of industry; after having witnessed the extensive means of power and grandeur, not over-burthensome to the people, and perhaps connected with their prosperity, which credit affords to government; we ask, with a sort of inquietude, why so many advantages have been so ill appreciated by recommendable wrihow enlightened governments could ever endanger them by frequent and multiplied failures; why some able men persist in seeing nothing in those failures but private interests injured and private fortunes deranged, and think such misfortunes unconnected with public interest? Am I deviating from truth, when I suppose this fatal error to proceed from the hatred which was always manifested in France towards capitalists and those who were called monied men 2

ters;

"

When they were indebted for their wealth to the profitable contracts which they entered into with government, and to their grinding the people; there might have been some colour of justice in considering a national bankruptcy as a sort of reprisals, as a kind of retaliation which they had deserved. Their misfortune was applauded by the same motives which induce the stupid Mussulmen to bless the grand-signor, when he confiscates the treasures of the pasha by whom they have been stripped and ruined. Had the results of such unjust proceedings been attended to, it would undoubtedly have been seen that the consequences of the bankruptcy which ruined French ca→ pitalists, and of the confiscation which ruined the Turkish pashas, fall upon all classes of the people, and are tantamount to the most burthensome taxes. But passion does not reflect; it only seeks to satisfy itself, without considering the good or ill that is to result from it. Passion does not perceive that national bankruptcies impede private savings; that they arrest or suspend their circulation, and deprive labour of the capitals through which it prospers; that they obstruct the circulation of produce, or burthen it with the enormous cost of the use of coin, and augment by as much the price of consumptions; which augmentation is equivalent to a tax ; and finally, that they reduce governments to the necessity of raising contributions beyond the faculties of the contributors, which is the utmost degree of public misery.

It is under the impression of these obvious and manifest consequences that I am warranted in observing, that bankruptcies are, in the present state of social

mechanism, a calamity more disastrous than wars and bad seasons. These last misfortunes at least may be repaired, and quickly disappear where credit has not been impaired, and when nations enjoy all their faculties, their means, and their power. But the loss of credit is irreparable, and destroys even the consolations of hope. May the picture of these dreadful results protect credit against fresh attacks, consolidate it by new measures, keep it unshaken among the nations that have known how to preserve it, restore it to those that had lost it, and establish it among those by whom it never was enjoyed! May credit, by its vast combinations, accelerate their private prosperity, and cause them all to share in the benefits of general wealth!

CHAP. V.

Which Trade is the most beneficial to National Wealth?

WHETHER the home or the foreign trade is most beneficial to national wealth, is one of the most important, most difficult, and most controverted questions of political economy.

At first sight the problem appears to offer no difficulties. The most advantageous trade to nations, as to individuals, must be that which causes the produce of a country to be sold at the highest, and foreign produce to be purchased at the lowest possible price. It seems that it is to this twofold end, that every