The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn Part 1

The Grounds of an Opinion on the Policy of Restricting the Importation of Foreign Corn: intended as an appendix to "Observations on the corn laws".

by Thomas Malthus.

The professed object of the Observations on the Corn Laws, which I published in the spring of 1814, was to state with the strictest impartiality the advantages and disadvantages which, in the actual circ.u.mstances of our present situation, were likely to attend the measures under consideration, respecting the trade in corn.

A fair review of both sides of the question, without any attempt to conceal the peculiar evils, whether temporary or permanent, which might belong to each, appeared to me of use, not only to a.s.sist in forming an enlightened decision on the subject, but particularly to prepare the public for the specific consequences which were to be expected from that decision, on whatever side it might be made. Such a preparation, from some quarter or other, seemed to be necessary, to prevent those just discontents which would naturally have arisen, if the measure adopted had been attended with results very different from those which had been promised by its advocates, or contemplated by the legislature.

With this object in view, it was neither necessary, nor desirable, that I should myself express a decided opinion on the subject. It would hardly, indeed, have been consistent with that character of impartiality, which I wished to give to my statements, and in which I have reason to believe I in some degree succeeded.(1*)

These previous statements, however, having been given, and having, I hope, shewn that the decision, whenever it is made, must be a compromise of contending advantages and disadvantages, I have no objection now to state (without the least reserve), and I can truly say, wit the most complete freedom from all interested motives, the grounds of a deliberate, yet decided, opinion in favour of some restrictions on the importation of foreign corn.

This opinion has been formed, as I wished the readers of the Observations to form their opinions, by looking fairly at the difficulties on both sides of the question; and without vainly expecting to attain unmixed results, determining on which side there is the greatest balance of good with the least alloy of evil. The grounds on which the opinion so formed rests, are partly those which were stated in the Observations, and partly, and indeed mainly, some facts which have occurred during the last year, and which have given, as I think, a decisive weight to the side of restrictions.

These additional facts are--

1st, The evidence, which has been laid before Parliament, relating to the effects of the present prices of corn, together with the experience of the present year.

2dly, The improved state of our exchanges, and the fall in the price of bullion. And

3dly, and mainly, the actual laws respecting the exportation of corn lately pa.s.sed in France.

In the Observations on the corn laws, I endeavoured to shew that, according to the general principles of supply and demand, a considerable fall in the price of corn could not take place, without throwing much poor lad out of cultivation, and effectually preventing, for a considerable time, all further improvements in agriculture, which have for their object an increase of produce.

The general principles, on which I calculated upon these consequences, have been fully confirmed by the evidence brought before the two houses of Parliament; and the effects of a considerable fall in the price of corn, and of the expected continuance of low prices, have shewn themselves in a very severe shock to the cultivation of the country and a great loss of agricultural capital.

Whatever may be said of the peculiar interests and natural partialities of those who were called upon to give evidence upon this occasion, it is impossible not to be convinced, by the whole body of it taken together, that, during the last twenty years, and particularly during the last seven, there has been a great increase of capital laid out upon the land, and a great consequent extension of cultivation and improvement; that the system of spirited improvement and high farming, as it is technically called, has been princ.i.p.ally encouraged by the progressive rise of prices owing in a considerable degree, to the difficulties thrown in the way of importation of foreign corn by the war; that the rapid acc.u.mulation of capital on the land, which it had occasioned, had so increased our home growth of corn, that, notwithstanding a great increase of population, we had become much less dependent upon foreign supplies for our support; and that the land was still deficient in capital, and would admit of the employment of such an addition to its present amount, as would be competent to the full supply of a greatly increased population: but that the fall of prices, which had lately taken place, and the alarm of a still further fall, from continued importation, had not only checked all progress of improvement, but had already occasioned a considerable loss of agricultural advances; and that a continuation of low prices would, in spite of a diminution of rents, unquestionably destroy a great ma.s.s of farming capital all over the country, and essentially diminish its cultivation and produce.

It has been sometimes said, that the losses at present sustained by farmers are merely the natural and necessary consequences of overtrading, and that they must bear them as all other merchants do, who have entered into unsuccessful speculations. But surely the question is not, or at least ought not to be, about the losses and profits of farmers, and the present condition of landholders compared with the past. It may be necessary, perhaps, to make inquiries of this kind, with a view to ulterior objects; but the real question respects the great loss of national wealth, attributed to a change in the spirit of our legislative enactments relating to the admission of foreign corn.

We have certainly no right to accuse our farmers of rash speculation for employing so large a capital in agriculture. The peace, it must be allowed, was most unexpected; and if the war had continued, the actual quant.i.ty of capital applied to the land, might have been as necessary to save the country from extreme want in future, as it obviously was in 1812, when, with the price of corn at above six guineas a quarter, we could only import a little more than 100,000 quarters. If, from the very great extension of cultivation, during the four or five preceding years, we had not obtained a very great increase of average produce, the distresses of that year would have a.s.sumed a most serious aspect.

There is certainly no one cause which can affect mercantile concerns, at all comparable in the extent of its effects, to the cause now operating upon agricultural capital. Individual losses must have the same distressing consequences in both cases, and they are often more complete, and the fall is greater, in the shocks of commerce. But I doubt, whether in the most extensive mercantile distress that ever took in this country, there was ever one fourth of the property, or one tenth of the number of individuals concerned, when compared with the effects of the present rapid fall of raw produce, combined with the very scanty crop of last year.(2*)

Individual losses of course become national, according as they affect a greater ma.s.s of the national capital, and a greater number of individuals; and I think it must be allowed further, that no loss, in proportion to its amount, affects the interest of the nation so deeply, and vitally, and is so difficult to recover, as the loss of agricultural capital and produce.

If it be the intention of the legislature fairly to look at the evils, as well as the good, which belongs to both sides of the question, it must be allowed, that the evidence laid before the two houses of Parliament, and still more particularly the experience of the last year, shew, that the immediate evils which are capable of being remedied by a system of restrictions, are of no inconsiderable magnitude.

2. In the Observations on the corn laws, I gave, as a reason for some delay in coming to a final regulation respecting the price at which foreign corn might be imported, the very uncertain state of the currency. I observed, that three different importation prices would be necessary, according as our currency should either rise to the then price of bullion, should continue at the same nominal value, or should take an intermediate position, founded on a fall in the value of bullion, owing to the discontinuance of an extraordinary demand for it, and a rise in the value of paper, owing to the prospect of a return to payments in specie. In the course of this last year, the state of our exchanges, and the fall in the price of bullion, shew pretty clearly, that the intermediate alteration which, I then contemplated, greater than in the case first mentioned, and less than in the second, is the one which might be adopted with a fair prospect of permanence; and that we should not now proceed under the same uncertainty respecting the currency, which we should have done, if we had adopted a final regulation in the early part of last year.(3*) This intermediate alteration, however, supposes a rise in the value of paper on a return to cash payments, and some general fall of prices quite unconnected with any regulations respecting the corn trade.(4*)

But, if some fall of prices must take place from this cause, and if such a fall can never take place without a considerable check to industry, and discouragement to the acc.u.mulation of capital, it certainly does not seem a well-chosen time for the legislature to occasion another fall still greater, by departing at once from a system of restrictions which it had pursued with steadiness during the greatest part of the last century and, after having given up for a short period, had adopted again as its final policy in its two last enactments respecting the trade in corn. Even if it be intended. Finally, to throw open our ports, it might be wise to pa.s.s some temporary regulations, in order to prevent the very great shock which must take place, if the two causes here noticed, of the depreciation of commodities, be allowed to produce their full effect by contemporaneous action.

3. I stated, in the Observations on the corn laws, that the cheapness and steadiness in the price of corn, which were promised by the advocates of restrictions, were not attainable by the measures they proposed; that it was really impossible for us to grow at home a sufficiency for our own consumption, without keeping up the price of corn considerably above the average of the rest of Europe; and that, while this was the case, as we could never export to any advantage, we should always be liable to the variations of price, occasioned by the glut of a superabundant harvest; in short, that it must be allowed that a free trade in corn would, in all ordinary cases, not only secure a cheaper, but a more steady, supply of grain.

In expressing this distinct opinion on the effects of a free trade in corn, I certainly meant to refer to a trade really free--that is, a trade by which a nation would be ent.i.tled to its share of the produce of the commercial world, according to its means of purchasing, whether that produce were plentiful or scanty. In this sense I adhere strictly to the opinion I then gave; but, since that period, an event has occurred which has shewn, in the clearest manner, that it is entirely out of our power, even in time of peace, to obtain a free trade in corn, or an approximation towards it, whatever may be our wishes on the subject.

It has, perhaps, not been sufficiently attended to in general, when the advantages of a free trade in corn have been discussed, that the jealousies and fears of nations, respecting their means of subsistence, will very rarely allow of a free egress of corn, when it is in any degree scarce. Our own statutes, till the very last year, prove these fears with regard to ourselves; and regulations of the same tendency occasionally come in aid of popular clamour in almost all countries of Europe. But the laws respecting the exportation of corn, which have been pa.s.sed in France during the last year, have brought this subject home to us in the most striking and impressive manner. Our nearest neighbour, possessed of the largest and finest corn country in Europe, and who, owing to a more favourable climate and soil, a more stationary and comparatively less crowded population, and a lighter weight of taxation, can grow corn at less than half our prices, has enacted, that the exportation of corn shall be free till the price rises to about forty nine s.h.i.+llings a quarter,(5*) and that then it shall be entirely cease.(6*)

From the vicinity of France, and the cheapness of its corn in all years of common abundance, it is scarcely possible that our main imports should not come from that quarter as long as our ports are open to receive them. In this first year of open trade, our imports have been such, as to shew, that though the corn of the Baltic cannot seriously depress our prices in an unfavourable season at home, the corn of France may make it fall below a growing price, under the pressure of one of the worst crops that has been known for a long series of years.

I have at present before me an extract from a Rouen paper, containing the prices of corn in fourteen different markets for the first week in October, the average of which appears to be about thirty eight s.h.i.+llings a quarter;(7*) and this was after disturbances had taken place both at Havre and Dieppe, on account of the quant.i.ty exported, and the rise of prices which it had occasioned.

It may be said, perhaps, that the last harvest of France has been a very favourable one, and affords no just criterion of its general prices. But, from all that I hear, prices have often been as low during the last ten years. And, an average not exceeding forty s.h.i.+llings a quarter may, I think, be conclusively inferred from the price at which exportation is by law to cease.

At a time when, according to Adam Smith, the growing price in this country was only twenty eight s.h.i.+llings a quarter, and the average price, including years of scarcity, only thirty three s.h.i.+llings, exportation was not prohibited till the price rose to forty eight s.h.i.+llings. It was the intention of the English government, at that time, to encourage agriculture by giving vent to its produce. We may presume that the same motive influenced the government of France in the late act respecting exportation. And it is fair therefore to conclude, that the price of wheat, in common years, is considerably less than the price at which exportation is to cease.

With these prices so near us, and with the consequent power of supplying ourselves with great comparative rapidity, which in the corn trade is a point of the greatest importance, there can be no doubt that, if our ports were open, our princ.i.p.al supplies of grain would come from France; and that, in all years of common plenty in that country, we should import more largely from it than from the Baltic. But from this quarter, which would then become our main and most habitual source of supply, all a.s.sistance would be at once cut off, in every season of only moderate scarcity; and we should have to look to other quarters, from which it is an established fact, that large sudden supplies cannot be obtained, not only for our usual imports, and the natural variations which belong to them, but for those which had been suddenly cut off from France, and which our habitually deficient growth had now rendered absolutely necessary.

To open our ports, under these circ.u.mstances, is not to obtain a free trade in corn; and, while I should say, without hesitation, that a free trade in corn was calculated to produce steadier prices than the system of restrictions with which it has been compared, I should, with as little hesitation say, that such a trade in corn, as has been described, would be subject to much more distressing and cruel variations, than the most determined system of prohibitions.

Such a species of commerce in grain shakes the foundations, and alters entirely the data on which the general principles of free trade are established. For what do these principles say? They say, and say most justly, that if every nation were to devote itself particularly to those kinds of industry and produce, to which its soil, climate, situation, capital, and skill, were best suited; and were then freely to exchange these products with each other, it would be the most certain and efficacious mode, not only of advancing the wealth and prosperity of the whole body of the commercial republic with the quickest pace, but of giving to each individual nation of the body the full and perfect use of all its resources.

I am very far indeed from meaning to insinuate, that if we cannot have the most perfect freedom of trade, we should have none; or that a great nation must immediately alter its commercial policy, whenever any of the countries with which it deals pa.s.ses laws inconsistent with the principles of freedom. But I protest most entirely against the doctrine, that we are to pursue our general principles without ever looking to see if they are applicable to the case before us; and that in politics and political economy, we are to go straight forward, as we certainly ought to do in morals, without any reference to the conduct and proceedings of others.

There is no person in the least acquainted with political economy, but must be aware that the advantages resulting from the division of labour, as applicable to nations as well as individuals, depend solely and entirely on the power of exchanging subsequently the products of labour. And no one can hesitate to allow, that it is completely in the power of others to prevent such exchanges, and to destroy entirely the advantages which would otherwise result from the application of individual or national industry, to peculiar and appropriate products.

Let us suppose, for instance, that the inhabitants of the Lowlands of Scotland were to say to the Highlanders, 'We will exchange our corn for your cattle, whenever we have a superfluity; but if our crops in any degree fail, you must not expect to have a single grain': would not the question respecting the policy of the present change, which is taking place in the Highlands, rest entirely upon different grounds? Would it not be perfectly senseless in the Highlanders to think only of those general principles which direct them to employ the soil in the way that is best suited to it? If supplies of corn could not be obtained with some degree of steadiness and certainty from other quarters, would it not be absolutely necessary for them to grow it themselves, however ill adapted to it might be their soil and climate?

The same may be said of all the pasture districts of Great Britain, compared with the surrounding corn countries. If they could only obtain the superfluities of their neighbours, and were ent.i.tled to no share of the produce when it was scarce, they could not certainly devote themselves with any degree of safety to their present occupations.

There is, on this account, a grand difference between the freedom of the home trade in corn, and the freedom of the foreign trade. A government of tolerable vigour can make the home trade in corn really free. It can secure to the pasture districts, or the towns that must be fed from a distance, their share of the general produce, whether plentiful or scarce. It can set them quite at rest about the power of exchanging the peculiar products of their own labour for the other products which are necessary to them, and can dispense, therefore, to all its subjects, the inestimable advantages of an unrestricted intercourse.

But it is not in the power of any single nation to secure the freedom of the foreign trade in corn. To accomplish this, the concurrence of many others is necessary; and this concurrence, the fears and jealousies so universally prevalent about the means of subsistence, almost invariably prevent. There is hardly a nation in Europe which does not occasionally exercise the power of stopping entirely, or heavily taxing, its exports of grain, if prohibitions do not form part of its general code of laws.

The question then before us is evidently a special, not a general one. It is not a question between the advantages of a free trade, and a system of restrictions; but between a specific system of restrictions formed by ourselves for the purpose of rendering us, in average years, nearly independent of foreign supplies, and the specific system of restricted importations, which alone it is in our power to obtain under the existing laws of France, and in the actual state of the other countries of the continent.(8*)

In looking, in the first place, at the resources of the country, with a view to an independent supply for an increasing population; and comparing subsequently the advantages of the two systems abovementioned, without overlooking their disadvantages, I have fully made up my mind as to the side on which the balance lies; and am decidedly of opinion, that a system of restrictions so calculated as to keep us, in average years, nearly independent of foreign supplies of corn, will more effectually conduce to the wealth and prosperity of the country, and of by far the greatest ma.s.s of the inhabitants, than the opening of our ports for the free admission of foreign corn, in the actual state of Europe.

Of the resources of Great Britain and Ireland for the further growth of corn, by the further application of capital to the land, the evidence laid before parliament furnishes the most ample testimony.

But it is not necessary, for this purpose, to recur to evidence that may be considered as partial. All the most intelligent works which have been written on agricultural subjects of late years, agree in the same statements; and they are confirmed beyond a possibility of doubt, when we consider the extraordinary improvements, and prodigious increase of produce that have taken place latterly in some districts, which, in point of natural soil, are not superior to others that are still yielding the most scanty and miserable crops.

Most of the light soils of the kingdom might, with adequate capital and skill, be made to equal the improved parts of Norfolk; and the vast tracts of clay lands that are yet in a degraded state almost all over the kingdom, are susceptible of a degree of improvement, which it is by no means easy to fix, but which certainly offers a great prospective increase of produce. There is even a chance (but on this I will not insist) of a diminution in the real price of corn,(9*) owing to the extension of those great improvements, and that great economy and good management of labour, of which we have such intelligent accounts from Scotland.(10*) If these clay lands, by draining, and the plentiful application of lime and other manures, could be so far meliorated in quality as to admit of being worked by two horses and a single man, instead of three or four horses with a man and a boy, what a vast saving of labour and expense would at once be effected, at the same time that the crops would be prodigiously increased! And such an improvement may rationally be expected, from what has really been accomplished in particular districts. In short, if merely the best modes of cultivation, now in use in some parts of Great Britain, were generally extended, and the whole country was brought to a level, in proportion to its natural advantages of soil and situation, by the further acc.u.mulation and more equable distribution of capital and skill; the quant.i.ty of additional produce would be immense, and would afford the means of subsistence to a very great increase of population.

In some countries possessed of a small territory, and consisting perhaps chiefly of one or two large cities, it never can be made a question, whether or not they should freely import foreign corn.

They exist, in fact, by this importation; and being always, in point of population, inconsiderable, they may, in general, rely upon a pretty regular supply. But whether regular or not, they have no choice. Nature has clearly told them, that if they increase in wealth and power to any extent, it can only be by living upon the raw produce of other countries.

It is quite evident that the same alternative is not presented to Great Britain and Ireland, and that the united empire has ample means of increasing in wealth, population, and power, for a very long course of years, without being habitually dependent upon foreign supplies for the means of supporting its inhabitants.

As we have clearly, therefore, our choice between two systems, under either of which we may certainly look forwards to a progressive increase of population and power; it remains for us to consider in which way the greatest portion of wealth and happiness may be steadily secured to the largest ma.s.s of the people.

1. And first let us look to the labouring cla.s.ses of society, as the foundation on which the whole fabric rests; and, from their numbers, unquestionably of the greatest weight, in any estimate of national happiness.

If I were convinced, that to open our ports, would be permanently to improve the condition of the labouring cla.s.ses of society, I should consider the question as at once determined in favour of such a measure. But I own it appears to me, after the most deliberate attention to the subject, that it will be attended with effects very different from those of improvement. We are very apt to be deceived by names, and to be captivated with the idea of cheapness, without reflecting that the term is merely relative, and that it is very possible for a people to be miserably poor, and some of them starving, in a country where the money price of corn is very low. Of this the histories of Europe and Asia will afford abundant instances.

In considering the condition of the lower cla.s.ses of society, we must consider only the real exchangeable value of labour; that is, its power of commanding the necessaries, conveniences, and luxuries of life.

I stated in the Observations, and more at large in the Inquiry into rents,(11*) that under the same demand for labour, and the same consequent power of purchasing the means of subsistence, a high money price of corn would give the labourer a very great advantage in the purchase of the conveniences and luxuries of life. The effect of this high money price would not, of course, be so marked among the very poorest of the society, and those who had the largest families; because so very great a part of their earnings must be employed in absolute necessaries. But to all those above the very poorest, the advantage of wages resulting from a price of eighty s.h.i.+llings a quarter for wheat, compared with fifty or sixty, would in the purchase of tea, sugar, cotton, linens, soap, candles, and many other articles, be such as to make their condition decidedly superior.

Nothing could counterbalance this, but a much greater demand for labour; and such an increased demand, in consequence of the opening of our ports, is at best problematical. The check to cultivation has been so sudden and decisive, as already to throw a great number of agricultural labourers out of employment;(12*) and in Ireland this effect has taken place to such a degree, as to threaten the most distressing, and even alarming, consequences. The farmers, in some districts, have entirely lost the little capital they possessed; and, unable to continue in their farms, have deserted them, and left their labourers without the means of employment. In a country, the peculiar defects of which were already a deficiency of capital, and a redundancy of population, such a check to the means of employing labour must be attended with no common distress. In Ireland, it is quite certain, that there are no mercantile capitals ready to take up those persons who are thus thrown out of work, and even in Great Britain the transfer will be slow and difficult.