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Thomas Malthus >> Importation of Foreign Corn
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The Grounds of an Opinion on the Policy of Restricting the
Importation of Foreign Corn; intended as an Appendix to
"Observations on the Corn Law"
by the Rev. T.R. Malthus, Professor of History and Political Economy
in the East India College, Hertfordshire.
London: Printed for John Murray, Albermarle Street, and J. Johnson
and Co., St. Paul's Church Yard, 1815.
Grounds, &c.
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
circumstances 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 assist 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 passed 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
principally 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 accumulation
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 mass 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 quantity 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
assumed 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 mass 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 accumulation 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 pass
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 entitled 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 passed 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
shillings 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 shillings a quarter;(7*) and this was after
disturbances had taken place both at Havre and Dieppe, on account of
the quantity 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
shillings 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 shillings a quarter, and the average
price, including years of scarcity, only thirty three shillings,
exportation was not prohibited till the price rose to forty eight
shillings. 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 principal 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 assistance 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 circumstances, 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 passes 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 entitled 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 mass 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 accumulation and more equable distribution of capital and
skill; the quantity 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.