'countries; and that the commerce carried on between them 'consists in the interchange of hardware, worth in England £1,000,000, for wine, worth in France £1,000,000. This being the previous state of things, let us assume further, that while England receives the wines of France duty free, France imposes a duty of 50 per cent upon British goods. The effects of this duty would be to alter the distribution of the metals in favour of France, and, consequently, to raise prices in that country, and to lower prices in England. The process would be as follows:-In France, the price of British goods would be increased by the amount of the duty, and their consumption in that country diminished in a corresponding degree; while in England, in the first instance, the price of French wines would not be enhanced, and the consumption would, consequently, 'continue as before. The result of these changes would be, that England could not now send to France such a quantity of hardware as would pay for the wine she received, and would be compelled to discharge a portion of her foreign debt by a transmis'sion of bullion: this would raise prices in France, and depress prices in England. In England there would be less money applicable to the purchase of wine, and the consumption would diminish. In France, there would be more money applicable to the purchase of hardware, and the consumption of British goods would gradually increase; and these processes would continue until the quantity of hardware sent to France again ' became sufficient to pay for the quantity of wine received, and until no further transmission of the metals should be required. • But when the commerce between the two countries should thus be restored to a trade of barter, the precious metals would no longer be equally distributed between them, and the scale of prices would be higher in France than in England.

6

These hypothetical illustrations, in which every element is imaginary, and the words France and England, hardware and wine, might be replaced, and perhaps advantageously, by A and B, X and Z, are often instructive. But the writer who uses them incurs one of two dangers: either that of fatiguing his readers by an enumeration of all the supposed circumstances which may affect the conclusion-an enumeration which it is as difficult to follow, and to bear in mind, as it is to master the dramatis personæ of a new play; or that of omitting to state some of the essential conditions.

Colonel Torrens has avoided the former of these errors. His illustrations are simple. They seldom contain more than three or four suppositions. But he has fallen headlong into the latter.

By not considering the precious metals as the subjects of waste and supply-by not considering the mode by which the stock is kept up by not considering the influence of commerce on the efficiency of labour, and by confining his attention to two, or at most three countries, and not considering the manner and the degree in which the changes in their mutual intercourse would affect their commercial relations with other nations-he has been able to extract from his assumed premises consequences which we believe to be not merely unlike those which would be the real results, but absolutely opposed to them. He has inferred wealth from conduct which would produce poverty; and a rise of prices from causes which would make them fall.

We will not, however, fatigue the reader by opposing to Colonel Torrens an hypothesis as abstract as his own, and more complicated. We will take the British islands and France as they are, and endeavour to show what would be the actual results to each country, of a change in the French commercial code which should suddenly diminish by one half our exports to France. And we hope that those among our readers to whom our arguments may appear trite, will be interested by some of our facts.

In the year 1841-the last for which we have either French or English returns-France, according to the French return, imported from the British islands, including their European dependencies, merchandize of the value of 144,048,592 francs, and precious metals of the value of 65,402,822 francs. Of the merchandize she re-exported 42,140,718 francs, and retained for home consumption 101,907,874 francs; of which 77,784,894 francs consisted of materials of industry, 7,939, 94 francs of raw consumable produce, and the remaining 16,183,086 francs, of complete manufactures. During that year she exported to the British islands merchandize of the value of 163,892,613 francs, and precious metals of the value of 20,876,485 francs. Of the merchandize, 56,401,681 consisted of foreign commodities re-exported; and the remaining 107,490,932 were French productions.

To avoid dealing with such cumbrous figures, we will call her exports to the British islands of French productions, and her imports for home consumption, each four millions sterling; threefourths of the imports consisting of the materials of industry. Supposing France now to impose duties reducing her British imports by one half: the first result would be, that French capital and French labour must be diverted from their previous employment, to produce at home what was previously purchased from abroad. On looking through the detailed statement of the impor

tations from the British islands, it will be seen that scarcely any commodity is mentioned, the use of which could be dispensed with, or without great inconvenience diminished. If we suppose that the supply could be produced at home at an additional expense of only 50 per cent, it would cost three millions to produce. what could have been imported for two millions. L.20 a-year is a high amount for the wages of a French family; at that rate of wages, and assuming nine-tenths of the cost to consist of the wages of labour, it would require the labour of 108,000 families, or about 540,000 persons. All this labour, and the capital necessary to set it in motion, must be taken from other employments. To what extent this would diminish the general division of labour in France, and the general efficiency of French labour, it is of course impossible to say; but that it would diminish both cannot be doubted.

In the next place, the increased cost of production of large classes of commodities, comprising many of the most important materials and implements of agriculture and manufactures, would occasion a further, and probably a still more severe blow to the industry of France. The loss annually inflicted on the agricul ture alone of France by the high duties on British iron, is estimated by an eminent French authority at 49,522,000 francs, or about two millions sterling.*

In 1841, France imported for home consumption, merchandize of the value of 804,557,931 francs, and imported in gold and silver 186,980,851 francs; she exported French products of the value of 760,653,561 francs, and in gold and silver 72,892,083 francs. In round numbers, her imports of merchandize may he called L.32,000,000 sterling, and her exports L.30,400,000; her imports of gold and silver L.7,500,000 sterling, and her exports L.3,000,000. About 45 per cent of her importations were the produce of the countries immediately adjoining her :-England, Belgium, and the dominions of the King of Sardinia, (which alone furnished more than 33 per cent,) Germany, Spain, and Switzerland; and the same countries received about 47 per cent of her exports. It is obvious that among countries so much resembling one another in climate, soil, and civilization, as France and the group of nations which surround her, a slight difference in the cost of production must decide, as to many commodities, which shall be the exporting and which the importing country.

*M. Annison. Examen de l'Enquête sur les Fers, cited by Mr Macgregor. Commercial Tariffs, France, p. 140.

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The diversion of a portion of the industry and capital of France from their former employments, in order to produce at home half of the commodities which she formerly imported from England, and the general diminution of the efficiency of her labour, would make it the interest of many French consumers to purchase abroad much of what they formerly purchased at home: it would make it the interest of many foreign consumers to purchase at home, or in other markets, much of what they formerly imported from France. Nearly one-fourth of the exports of French ducts consists of cotton and woollen manufactures ;-commodities with respect to which she has no natural advantages, and in which Britain, Belgium, Germany, and America are her formidable rivals. An addition of one thirty-second part to the imports into France, and a diminution by one-thirtieth of her exports, would take from her more than the two millions of specie which, according to the Mercantile Theory, she was to have gained by the exclusion of British commodities. But it is clear that she would lose much more. We have seen that the value of money, in relation to labour, in different countries, differs according to the efficiency with which in each country labour is applied. As French labour became less efficient, its value would fall in the general market of the world-a less sum than before would perform the functions of money. As the value of gold and silver with relation to labour rose, or, in other words, as it required more labour to purchase a given quantity of either, her population could no longer afford to use the same quantity of plate. She would require less of the precious metals than before, and she would obtain less. Her national debt, her taxes, and her fixed payments, would rise in value; and all the effects which, according to Colonel Torrens's supposition, ought to occur in England, would take place in France. There would be a change in the distribution of the precious metals; and, what is really important, there would be in France a change in the cost of obtain ing them. France would not only have fewer commodities, but less gold and silver; and, to obtain a given amount of either the one or other, would cost every Frenchman more labour than it does now.

Let us now see what would be the effects in England. From the year 1825, the earliest for which we have regular returns, until 1841 inclusive, England has exported to France, in coin and bullion, the average annual sum of 95,563,294 francs, or L.3,822,531; and has imported from France, in corn and bullion, the average annual sum of 36,273,840 francs, or L.1,450,953. As soon as the change in the French tariff took place, and the export of commodities from England to France fell .

from L.4,000,000 to L.2,000,000, her imports continuing to be L.4,000,000, it would be necessary that England should either increase her annual remittance of coin and bullion to France by L.2,000,000, or cease to receive the 1,400,000, which she now receives, and increase her remittance by only L.600,000. As the greater part of the bullion which England annually imports is imported only for the purpose of re-exportation, she might either direct to France a larger portion than she now directs to her of her exports of the precious metals, or she might order her foreign correspondents to send to France, instead of to herself, L.600,000 out of the eight or nine millions of gold and silver which she now annually receives.

Such a change would produce a slight disturbance in the bullion trade-one of the most trifling businesses in the empire; and this slight and transient disturbance would be the whole amount of its effect on the British money market. Instead of draining us of our gold and silver, doubling our debt, halving our wages, and making us pay to the French treasury an annual tribute of L.2,000,000 steriing, it would merely give some trouble to the clerks of half a dozen dealers in a trade which probably does not employ 500 persons!

The only real injury which England would suffer, would be, that the L.2,000,000 of commodities formerly sent to France, must now receive a different destination; or the labour and capital formerly devoted to them a different employment. Of course, this would be an inconvenience. Every forced change in the channels of trade is an inconvenience. But there are grounds for believing that in this instance the inconvenience would not be great or permanent. In the first place, England would find herself in an improved situation in all the markets in which France was formerly her competitor. The efficiency of labour, and consequently the power of exporting commodities, having diminished in France, the English exporter would every where meet his French rival on better terms;-might divide a trade of which he previously had only a small share, and monopolize one which he previously divided. And, as all manufacturing superiority has a tendency to increase-the greater quantity being in general produced at a less proportionate expense, and the less quantity at a greater proportionate expense-it is difficult to say to what extent the relative superiority of English over French manufacturing industry might be carried. The new or enlarged outlets might be sufficient to absorb the whole L.2,000,000 worth of commodities excluded from the French market. We will suppose, however, that they dispose of only one-half. The labour and capital previously engaged in producing commodities of the value of L.1,000,000,