| The National Gain
The National Gain
It is not to be gainsaid that every
Nation has gain as the chief object of its Economic and Political
statutes, but if we consider the expedients each one has resorted
to in order to secure gain, we shall notice incredible discrepancies.
Each vies with the other to arrive first;
but they steer different courses and carry quite different sails,
though almost the same wind fills them all.
They try to get to windward of one another
and use special sailors' tricks to run into one another, though
there is space and depth enough for them to sail abreast. It seems
as if now one of the ships, now the other, was without a Pilot
and a Helmsman.
Nobody can deny that in this way the
work follows different rules. Either the Compass is unreliable
or the Chart must be wrong.
A new guide is now put before the eyes
of the Reader. It is quite a small one, so that everyone may be
able to carry it in his pocket. It is new as well, I said, for
it hardly conforms to any other in Europe. And I think it is reliable,
too, for I have attempted to found it upon reason and experience.
Let us first agree as to the words.
A Nation is a multitude of people who
have joined in order to secure their own prosperity and that of
their descendants under the protection of the Government and through
its Public Servants.
Man thrives when he enjoys his needs
and comforts, which, according to our ordinary way of speaking,
are called goods. Nature produces them, but they can never be
of use to us without labour.
Our wants are various, and nobody has
been found able to acquire even the necessaries without the aid
of other people, and there is scarcely any Nation that has not
stood in need of others. The Almighty himself has made our race
such that we should help one another. Should this mutual aid be
checked within or without the Nation, it is contrary to Nature.
When we exchange these commodities,
it is called commerce, and the commodities that are commonly desired
and accepted are gold and silver, larger or smaller coined parts
of which are called money, which has become the measure of the
value of other commodities.
No commodity exists, but that it cannot
be changed into these Metals by commerce, nor can any commodity
be obtained in the absence of other commodities desirable to the
seller; and the quantity of money that must be paid for the commodity
is called its value.
The value of exported goods in excess
of that of imported ones is rightly called the gain of the Nation,
and the value of imported goods in excess of that of exported
ones will always be its loss. But a loss that is less compared
to another one is called relative gain; and in the same way a
smaller gain, when a greater can be attained, is called a loss.
If the statement were correct in every
respect that last year, 1764, Sweden exported goods to the amount
of about 72 Million Daler of copper currency, but that the imports
did not amount to more than 66 Millions, then our National gain
for that year would have been 6 Million Daler.
The value of iron is about two-thirds
of all our Exports, but let us assume that within a hundred years,
on account of lack of forests or from other causes, the Export
of Iron were reduced to one-half and were thus not to comprise
more than one-third of our Exports, but that some others, e.g.
corn, food, and timber, were exported instead of the third lost
in the Iron trade. Then I ask, in case all the other exported
and imported goods amounted to the same value as they have now,
whether the National gain would not be just as great then? Or
if the Export of Iron were at some time reduced by 6 Million Daler,
but if the 10 Millions paid last year to foreigners for corn remained
in the Country instead, would not the Nation then equally have
gained 4 Millions by this change?
If we imagine that there were a State
that had neither agriculture nor mining, neither cattlebreeding
nor shipping, but only made an abundance of crockery from earth
or clay, which was in great demand all over Europe, and hence
obtained not only all its wants, but also received 2 Millions
in gold and silver every year, would not these 2 Millions undeniably
be the gain of that Nation?
But if one-third of the same Nation,
after the example of others, were to abandon this trade of theirs
and become farmers with the intention of thereby producing bread
for themselves and their fellow-citizens, thinking that they would
gain more in this way, but that the corn produced was 1 Million
less in value than the former production of the same one-third,
it is obvious that by this they would have caused the Nation 1
Million reduction in gain or, which is the same thing, an equally
From this it leaps to the eye that a
Nation does not gain through being occupied with many different
trades, but through working in those that pay best, that is, in
which the least number of people can produce commodities to the
Thus the wealth of a Nation consists
in the multitude of products or, rather, in their value; but the
multitude of products depends on two chief causes, namely, the
number of workmen and their diligence. Nature will produce both,
when she is left untrammelled.
Would the Great Master, who adorns the
valley with flowers and covers the cliff itself with grass and
mosses, exhibit such a great mistake in man, his masterpiece,
that man should not be able to enrich the globe with as many inhabitants
as it can support? That would be a mean thought even in a Pagan,
but blasphemy in a Christian, when reading the Almighty's precept:
"Be fruitful, multiply and fill the earth."
It was punishment for fallen man to
support himself in the sweat of his brow; but this punishment
was such that Nature itself measured it out, when man was forced
to work because of his wants, when he had nothing but his own
hands to rely on for his needs; and toil was made lighter by the
desire for his own benefit, when he saw that he could thereby
get what he needed.
If either is lacking, the fault should
be sought in the laws of the Nation, hardly, however, in any want
of laws, but in the impediments that are put in the way of Nature.
If by them citizens are rendered incapable
of supporting themselves and their children, they must either
die together with their offspring or forsake their native land.
The more expedients are afforded by laws for some people to live
by the toil of others, while others are prevented from supporting
themselves by work, the more is diligence checked, and the Nation
cannot but resemble the mould in which it is cast.
Now, if this is incontrovertible, I
intend to found thereon the following proposition, i.e. that every
individual spontaneously tries to find the place and the trade
in which he can best increase National gain, if laws do not prevent
him from doing so.
Every man seeks his own gain. This inclination
is so natural and necessary that all Communities in the world
are founded upon it. Otherwise Laws, punishments and rewards would
not exist and mankind would soon perish altogether. The work that
has the greatest value is always best paid, and what is best paid
is most sought after.
As long as I can produce 6 Daler worth
of goods a day in one trade, I do not willingly change to another
that brings in 4. In the former case the Nation's gain and mine
was one-third more than in the latter.
It is thus undoubtedly a loss to the
Nation when somebody is forced or is encouraged by public rewards
to work in a trade other than the one in which he earns the highest
profit; for this does not happen without such inducements, just
as a merchant does not sell his Wares for less than what is offered
If he whose work someone has been forced
to do gains as much as the worker has lost, it is not National
gain; but if he gains more, only the difference is the gain of
the Nation, but obtained through the oppression of its citizens.
Thus it is obvious that, when somebody
conducts an enterprise by the work of others, but neither pays
nor is able to pay without loss as much as the workers can earn
in some other trade, the deficiency in their wages must then be
a National loss.
For example, if an Ironworks producing
2000 ship's pounds a year had at its command one hundred Peasants,
who had to work fifty days a year each for this Works, but at
one Daler Copper currency less than they would have been able
to earn either by their own work or otherwise - and this to the
end that the Exported goods might be sold abroad at some profit
- then it is obvious that each Peasant will in that way lose 50
Daler Copper currency a year or, which is the same thing, will
produce goods to the value of 50 Daler less than in other work,
so that the National loss will be 5000 Daler.
If there were at the command of the
same Ironworks several hundred Peasants, who had to provide it
with the charcoal necessary for the work, for example 3500 chaldrons
either for a number of Daler agreed upon at an earlier date or
else for what the owner of the Works would give, for example 6
Daler Copper currency less for every chaldron than they would
have been able to earn in another way during the same time (even
if the Owner cannot pay a higher price for this commodity, if
the iron is to be sold with any profit abroad; but if the same
Peasants, during the time they worked on the coal, had been able
in farming, handicrafts and weaving or other trades to earn the
loss on every chaldron of coal, that is, had been able to produce
goods to the value of 21000 Daler Copper currency more, then it
is obvious that the National loss is thereby increased by as large
a sum. If we add to this the almost irreparable loss of the Country's
best forests, which after some time would have afforded us various
materials for handicraft and timbertrees, and reckon ten cartloads
of long logs for every large chaldron of charcoal used for these
2000 Ship's pounds of Bar-iron from the moment the ore was dug
out of the mine till the time when the Iron is hammered out into
bars, 35000 cartloads of wood, which, only reckoned at 16 öre
a cartload, will increase the loss by 17500 Daler, which taken
together means a loss of 43500 Daler Copper currency.
Now, if these 2000 ship's pounds were
sold at an average price of 6 Riksdaler Banco a ship's pound,
exclusive of the freight, and thus made a sum Of 240000 Daler
Copper currency at the exchange rate of 80 marks, it is obvious
that rather more than one-fifth of this sum is a National loss,
even though the whole quantity is sold abroad.
Gold and silver are, indeed, the most
precious Metals, but they do not therefore always increase the
National gain when they must be extracted from the earth. All
merchandise can be exchanged into so much of these Metals as corresponds
to its value. Neither is the Ducat ever so red that it will not
be given for bread, as our ancestors used to say.
Would it not be useful to consider whether
the 38 marks 4 Iods of gold and 5464 marks ½ lod of silver
that have been extracted, from the beginning of 1760 to the end
of 1764, are equivalent to the cost and work spent on them and
to the rent of land from several parishes which has been appropriated
thereto and so on? Or whether for all this many times as much
silver and gold could not have been imported at the highest rate
of exchange? Or whether such patriotism or love of Swedish gold
and silver has really increased the National gain? Or whether
they had to be maintained only in the hope of greater gain in
Finally, is there not an evidence of
National loss in the complaints and poverty of the workmen and
Peasantry at and around the Ironworks, from being under compulsion,
and desirous of using their time and abilities on what would be
more useful to them and the Realm at the present time?
Here I am by no means talking about
such works as exist without any disadvantage to the Peasantry
and workmen; they are just as precious jewels of the Nation as
ever Farming, Trade and Manufacture.
From this it follows of itself that
it is quite unnecessary for the Government to draw workmen from
one trade into another by means of laws.
Nevertheless, how many Statesmen are
there that have busied themselves with this? Almost all Europe
is making efforts to draw the people from their previous trades
and put them into others either by force or by granting them privileges.
They boast of a National gain as great as the value of the new
production, and often forget that the workmen employed in this
production might if free, have produced goods in their former
trade, to an equal or higher value, and in the first case there
was no gain, but in the second a real loss to the Nation.
If ten men produce goods to the value
of 100 Daler a day in one trade, but in another to a value of
not more than 80, it is obvious that in the latter eventuality
the Nation will lose 20 Daler a day on those ten men's work. Whether
these ten workmen be at liberty to sell their produce or be free
to negotiate for daily wages with those who conduct the trade
in question, the difference in their wages will always be in the
said proportion, and then it is certain that they will enter the
former as being more profitable to the Nation and to themselves.
But if these workmen are forced to remain
in the other trade at 20 per cent. less wages, this 20 per cent.
is their loss and the Nation's. How unnecessary laws seem to be
in such cases!
Neither Bounties on Production nor on
Exportation are of any good to increase or promote National gain.
They are resorted to almost all over
Europe, but more especially in England, though they infallibly
increase the real loss everywhere. The Bounties on Production
do harm in a simple way, but those on Exportation in a twofold
If there are workmen enough in a trade
and Bounties on Production are given notwithstanding, then too
many people will be tempted to leave other trades, a superabundance
of goods will make it less profitable and cause lack of workmen
in other remunerative branches of trade, and the State will be
burdened by enriching certain citizens. If people do not enter
a known trade without special rewards, then it is obvious that
it is less profitable than other trades in which workmen are never
If, by means of rewards, the State makes
up the loss suffered in this trade by the workmen and the Nation,
there may be those who will take it up, but their work is lost
to the more remunerative trade. Thus, as much as the values of
the products differ, so great undeniably will be the loss of the
But the Bounties on Exportation have
not only the disadvantages mentioned above, but also much more
important ones: citizens are here taxed doubly in relation to
the amount of the Bounty and a great part of it is put into the
hands of foreigners, a fact that cannot but pain everybody who
has come to love his Native Country.
A seller always tries to get the highest
price for his goods. The owner agrees with the foreigner upon,
for instance, 6 Riksdaler for the article; but for this he gets
a Bounty of 2 Riksdaler, and thus he will get 8 Riksdaler in all.
Now, if a Swede wants to buy this same
commodity, it is undeniable that he must pay the seller as much
as the latter will make by selling it to the foreigner, namely,
8 Riksdaler, otherwise the seller thinks that he has lost money
A foreigner will thus buy 2 Riksdaler
cheaper on account of the Bounty on Exportation, and because of
that a Swede will be doubly taxed, namely, 2 Riksdaler to the
fund for facilitating the purchases of the foreigner and 2 Riksdaler
to indemnify the seller.
Accordingly it must happen that the
foreigner can carry on the most profitable trade with our products
in our own country. I stick to the little example I have mentioned:
the Swedish Manufactured goods that were sold to the foreigner
for 6 Riksdaler he can immediately on the spot sell for 7½
Riksdaler, at a profit of 25 per cent., to a Swede, who thus makes
a purchase for half a Riksdaler less, or gains 8 1/3 per cent.,
than if he bought them from a Swedish Factory-shop, and therefore
there will never be any lack of buyers.
If we then add the 33 1/3 per cent.
better bargain of the foreigner to the 25 per cent. gained on
the sale, it will make a profit for him of 58 1/3 per cent., which
has been gained only owing to the Bounties upon Exportation and
which would otherwise never have been possible. And this is a
truth that not only has been proved in theory, but has also many
times been confirmed by actual experience.
I could reveal a little Commercial plan
that would give Sweden several thousands from some foreign Bounties
on Exportation, did I not fear to wake others from their lethargy,
when they might close some secret veins which, without being noticed
in the Balance of Trade, now really counterbalance our deficit.
Therefore I sincerely wish that the
English and other Nations may not only maintain their Bounties
on Exportation, but also that these may be markedly increased
on all the goods that can be placed to our debit; but, on the
other hand, that my Native Country may get rid of these Bounties
together with the obligations that prevent us from taxing our
neighbours freely and frequently.
Now I venture to go further and assert
that laws which force people to enter certain trades are harmful
to the Nation and reduce its gain: I am moved to do so for four
reasons which are very important in my opinion.
In all Europe there is no fixed principle
yet governing this distribution of workmen; for such laws are
sometimes made to improve a new kind of handicraft or manufacture;
sometimes to procure a livelihood for more inhabitants, and sometimes
to give the owner of a workshop a greater profit by reducing wages.
Sometimes this is done to make our manufactures
exportable; sometimes to produce some necessity or other within
the Country. Now such an arrangement is made so that our own shipowners
may profit by the freights on our own goods and Swedish men by
wages; now, again, to get gold and silver into the country. Sometimes
the Statutes aim at preventing the people emigrating; sometimes
they aim at checking luxury. Sometimes they are found necessary
to maintain order in trade and industry, and sometimes they must
exist to prevent people driving different trades at the same time,
and innumerable other things.
Is not all this lacking in the right
sort of System? And must not a house built after so many designs
have a strange appearance and lack the necessary stability?
The second reason is this: that no Statesman
is yet found capable of stating positively which trade will give
us the greatest National gain, and consequently the Legislator
must remain irresolute as to what goal he should guide our workmen
to by his laws.
Who could be so stupid, someone will
probably think, as not to know this? I assure you that it is not
so easy as people imagine. Many who have troubled to think about
these matters may have laid down a System and put every trade
in order of precedence, but if we compare these Systems with those
of others, we shall notice what differences there are between
I think that mine is certainly the best,
but observing that everybody thinks the same of his, one must,
like a sensible being, doubt everything until the matter is fully
M. says that agriculture is the best;
E. S. that this honour belongs to handicrafts; 0. R. proves that
it is commerce; A. G. that the Country must be helped by our ironworks,
which are the source of its chief Exports, and so on. Who of all
these is right?
They are all of them enlightened and
scrupulous men, and they also enjoy the confidence of their fellow-citizens,
and still it will be a long time before this dispute is settled.
What trade, however, should the Government consider the most useful,
and to which should they lead the population to the gain of the
Nation? Or can mistakes be avoided in such circumstances?
However, if this controversy were quite
settled, and a Statute were issued that should guide the people
to the most profitable trade, I wonder if the Legislator would
be capable of saying how many thousands of people could, now,
work in it to the gain of the Nation, and that the same Statute
would have the desired effect during so and so many years. It
might happen only too soon that people would be drawn from other
trades, and produce in this one a superabundance of goods, which
consequently might lose their value abroad and result in an appreciable
loss to the Nation.
But even if it were possible to have
all the knowledge needed for this - a thing that would be absolutely
impossible - might it not happen, notwithstanding, that goodwill
might be lacking among those who arrange this matter, a fact which
I give as the third reason.
It might easily happen that they themselves
derived some advantage from the people being guided to that or
another special trade, and would therefore advocate it. What else
could happen then but that the most useful trade would be robbed
of people to the irreparable loss of the Country?
If we finally imagine that we have surmounted
all these obstacles and got ideal laws on this subject, a few
special incidents might change the whole of this excellent state
of things and make the most useful laws quite harmful to the Nation,
in which fact the fourth reason against them is obviously to be
What changes in goods, what different
values, are not to be seen daily? Quite unexpectedly Providence
opens to a Nation a source of Wealth that will last for some time;
but often it suddenly dries up, and a second or a third comes
into existence on which the National gain will chiefly depend.
Among the thousands of possibilities the law - even if it is the
very best - is thus useful only in certain circumstances, namely,
in those for which it was made, but harmful in all others.
And these are the real reasons why our
wellintentioned Statutes must have had such an ill effect.
Now I think it is about time to investigate
more closely what kind of Statutes these are that draw people
from one trade to another.
Such are all those that directly or
indirectly grant privileges to one trade in preference to another.
This is done directly, when the words of the Statute explicitly
grant them; but indirectly, when the privileges are a necessary
consequence of the observance of the Statute.
Thus, all privileges in trade belong
here, not only the Exclusive ones, but also all those which give
a producer some special advantage; all classifications of trade
made by Law; for Nature itself makes a classification, which is
the safest; but as soon as the Laws add to or deduct something
from it, disturbances will immediately be noticed, which favour
some special persons, but prevent others from carrying on their
trade. Further, all Bounties on Production and Exportation are
classed among these, together with all restrictions of liberty
of dwelling or carrying on trade in towns or in the
What else are these things but dams
that collect people in certain places, remove them from one place
to another without anyone being able to say in which place they
will be of most use, or whether they will increase or reduce the
National gain, as is proved above.
When a stream is allowed to flow smoothly,
every drop of water is in motion. Men there are no hindrances,
every workman strives for his daily bread and thereby increases
the gain of the Nation. But by Statutes the people are collected
into certain groups, the possibilities of trade become limited,
and in each group a small number keeps at the top above the great
body of the people whose opulence is used as a reason for assuming
the prosperity of the whole Nation.
These dams are the same that impede
the increase of the number of Swedish workmen, which, however,
as shown in § 4, is the first foundation of National gain.
The weight of the water in a dam rests
on the Water nearest to the bottom, so that the building must
be much stronger and much more solid there; for we know from experience
that the water at the bottom pours out through the smallest opening
with greater rapidity than it does at the surface.
It is just the same thing with our population.
We may turn to any trade and the number of people working in it.
If we look at the landowners, we shall
scarcely find a single example of anybody who owns a large estate
wanting to emigrate, though those who are waiting to get the same
property after him are willing to give him money for the journey;
but I wonder whether we can be just as sure about the Crofters
of this Estate and their children?
I have often asked them where their
children were, but from most of them I have got sad answers. "What
should we do with them at home now? We have to toil hard to support
ourselves in this place as long as God permits it. For some years
our eldest, son was a sailor on a boat running to Holland, but
stayed out there and is said to be prospering now. The second
is on a boat running to England, but the last time we saw him
he said good-bye for ever, intending to settle down there. The
third went to Pomerania with the Army; he was taken prisoner by
the King of Prussia, but when God gave us peace he did not want
to return; he is now in the Prussian service and has married out
there. The fourth is still a boy in petticoats, and God only knows
what he will do or what will become of him."
Why does not a Yeoman remove? Because
he is rooted there. But why should a farm-hand be more likely
to do so? The answer is obvious: because the Statutes have not
allowed him to settle down in any one place.
If we look at our Guilds and the crowds
within them, we shall notice a few well-off Masters, who need
no longer sit in their workshops themselves, who live comfortably,
dress themselves and their families after the latest fashion,
keep a good table every day, pay and receive calls most of the
time, and have ten or twelve workmen in their workshops, six of
whom work for their food only, the others for a few Dalers a week.
I ask, "Does such a man want to leave the country? "
He will not do so as long as the Guild can provide him with workmen
and takes care that the number of Masters does not become so great
that he will of necessity be short of work and thus unable to
dictate the price.
But what happens to his Journeymen and
Apprentices? That is a more delicate question. I have sometimes
heard their swan song and a general complaint in the Country,
because they leave for Prussia and Russia; for there those soon
become Masters who like.
Fancy! How benevolent are our Guilds
not to cast off a poor man's children, but allow them to fill
a gap thus opened without any payment.
If we turn to our Iron works, we shall
soon notice that it is far from being the wish of the owners of
most of those Works to leave Sweden; but several poor Owners,
who lack capital for carrying on their business, complain about
slow sales, compulsory prices and the poverty they are threatened
with, and that is quite another matter.
What is it that Smiths and Workmen complain
of? Why do not the imported foreign workmen stay long? Why do
the natives seldom marry and mostly become miserable creatures
in the end? And how is it that the Corn and Provision business
is only a little less profitable to the Owner than the Forging
of Iron itself? And what is the cause of the peasants, who are
under the command of the Works, getting breeze in their fields*
and telling such stories about their children as did the Crofter
The manufacturer is really as well dressed
in his own produce as anybody, but the workmen in the spinning-mill
often sit half naked, and others walk the streets in rags, and
beg, saying that they are foreigners who have been induced to
come to the Country, but who now wish they were home again rather
than in Sweden, where they have to stand at other people's doors
and will finally have to die in poverty.
Among those who move from the towns,
the mania for moving seldom affects those who are well-off or
are Aldermen, but often does the poor and humble Burghers.
I think it is almost unheard of that
Sea-Captains and Mates should desert their ships in a foreign
harbour unless on account of crimes; but I dare not say the same
about the ordinary Sailor or the Cook's boy.
Honoured Reader! Do you not now see
the reason why our number of workmen does not increase and thereby
our National gain? As far as I can see, it will for ever be impossible
to stop this running away, if the dams are not opened.
The less the pressure is, the easier
is the water retained; but the lower the water column is, the
less is the pressure, and the column will always be lowest when
the lock-gate is taken away.
_ _ _ _ _ _ _ _ _
*A peasant under the command of the
Works is said to get breeze in his fields, when he has so much
to do for the Iron works that because of that he neglects his
farming and thus suffers from failure of crops (Author's note).
The other foundation of National gain
is the workmen's diligence - that is, when the least number of
people produce goods to the highest value possible.
Many a man who observes our Nation only,
might easily imagine that there was no lack of diligence among
them, but I must confess that it has hurt me to hear foreigners
reproach us for being a lazy Nation compared to others.
A Dutch Merchant will be sitting in
his office every morning at five or six o'clock seeing to all
his Business; he dresses plainly and his table does not bend beneath
sumptuous dishes; he is anxious to accomplish something every
hour and makes a laughing-stock of Frenchified bucks and aristocratic
An Englishman is hardy and indefatigable
in his work. A Carpenter at the English dockyards caulks with
such strength and rapidity that, when he works, one can scarcely
see the club in his hand, and he gets a Man-of-War ready in as
many days as weeks would be needed in the Swedish Royal dockyards.
What is the cause of all this? Somebody
might think it is the workmen's slackness, as there is no strict
watch kept over them. "Vagabonds," they say, "are
idling everywhere in the country; journeymen and Apprentices are
no longer what they were; Men and Maids won't move unless their
Master is with them himself."
I do not know whether there are more
Inspectors anywhere than with us. But who is to keep watch, when
the Inspectors themselves sleep till ten o'clock in the morning?
I have heard several proposals of this kind: that when a peasant
will not work diligently on his farm he should be whipped at the
whipping-post or at least be driven from his freehold. Indeed,
it has already actually happened that some have been punished,
because they have not been able at once to give up a very old
source of livelihood without which they would, in the first place,
have had to be at least half-starved.
Such people unfailingly understand our
liberty. Flogging and liberty together, a strange idea!
Do not let us accuse the Nation and
its genius of slackness; do not lay the blame on corrupted morals.
True, we should most easily get away from the problem in that
way, but the Country will gain little good thereby. The source
of this evil is to be found elsewhere.
The more opportunities there are in
a Society for some persons to live upon the toil of others, and
the less those others may enjoy the fruits of their work themselves,
the more is diligence killed, the former become insolent, the
latter despairing, and both negligent.
This foundation is so firm and so established
by our knowledge of the human heart and our daily experience that
I challenge anybody to overthrow it fairly.
Industry and diligence require a gay
heart and constant competition, if they are not to slacken. They
are never to be found under the yoke; but when they are encouraged
by liberty, quick returns and individual gain, the natural torpor,
which can never in the long run be driven away by blows, will
Commodities are never produced without
being wanted and demanded. Wants show themselves; they are manifold,
and thus they spontaneously call into existence trade and products,
which latter will later be sold to those, who need them. If anyone
who needs a commodity is prevented from buying it, this commodity
will remain on the producer's hands, will be a burden to him and
get a black stamp on it, on which the words may be read: "Wasted
expenditure of energy."
This is hitting assiduity below the
belt. Here is the cord that binds the workman's hands behind his
back, and the beverage that makes citizens bad and lethargic.
No Nation can be diligent as long as
this stamp remains on its products, and the stamp can never be
obliterated until the commodity can be produced by anyone who
wants to make it and sold to him who needs it.
I shall not refer to the example of
other States in evidence of this: my own Country is an incontrovertible
witness, which I refer to with all the more boldness as its condition
is best known, and nobody is likely to think of his country without
anxiety for its adversities.
Swedish diligence is like a crop on
a badly cultivated field. Here and there stand a few thriving
tufts, but most of it is withered and will scarcely return the
In Westrogothia, handicraft and weaving
are carried on with diligence: there an old man is not ashamed
of sitting at the spinning-wheel; there knives, bowls, plates,
tapes, bells, scissors and other articles can be had for less
than elsewhere. What is the reason? The dweller in that county
is entitled to go wherever he wants and sell his goods. The town
of Boris has since times of old been allowed to carry on peddling
all over the Country, i.e. enjoyed the liberty to go about the
farms and buy goods and sell its own to others.
As no other Province in the Country
but this one has had that liberty, I defy anyone to show in any
other Province the industry that is to be found among its inhabitants.
Thus it is obvious that here either diligence has produced liberty
or liberty diligence.
Some years ago in Westrobothnia, Helsingland
and West-Norrland a great many chairs and spinning-wheels were
made, and the former were sold at a price of 9 to 12 Daler a dozen,
the latter at 6 to 9 Daler a piece. Owing to sales restrictions
the production has now ceased to a large extent and it seems as
if the inhabitants would soon have to buy these articles from
Along the coast of Ostrobothnia, people
are active both winter and summer, but 30 to 40 (Swedish) miles
inland, where there are no towns, most people's occupation during
the winter is to sleep and make Torches, as many as they will
burn. There are no buyers for goods, therefore there are none
About Björneborg, Raumo and Nystad
the Peasants are almost indefatigable in making wooden articles.
All through the winter the worker is hard at work making all kinds
of wooden vessels as early as one or two o'clock in the morning,
and thus he can sell his goods cheaper than anybody in all Finland,
though many others along the coast have not only a better supply
of forests, but also of workmen well versed in this trade. Let
us look for the cause of this. It is quite impossible that such
diligence could arise and be maintained without freedom of Export.
The towns mentioned above have of old
had the liberty of sailing round the Baltic with poles, laths
and wooden vessels. The Staple Towns have often tried to deprive
them of this privilege, but have up till now been unsuccessful.
Now those towns supply not only several foreign places with such
goods at reasonable prices, but even Stockholm itself to some
degree, and at such prices that they undersell almost everybody
But had the prohibition been successful,
the sales would of necessity have been limited, and consequently
production to the same extent. Limited production makes idle hands
and expensive goods, and if it should one day happen that other
towns are allowed to stop these sales or prevent workmen from
free occupation, then it is as certain as that two and two make
four that Stockholm would have to buy more expensive wooden vessels
than before, these towns would have their trade reduced, the country
would lose inhabitants and earnings and the State its gain.
Behold! Here is the key to diligence
and benefit. If the door is opened to gain by freedom of trade
and sale, then everybody will be fully occupied within a few years;
but if that is not done, the Nation will certainly remain yawning,
as before, and sleepy in broad daylight, in spite of all other
"Freedom," my Reader will
think, "there certainly should be, but not without order.
One must distinguish strictly between the trade of the Towns and
of the Country and not allow Farmers to busy themselves with anything
else, so that farming may not be neglected." Very well said,
especially to the taste of the day! But there is one reservation
I should like to make most respectfully, namely, that whoever
undertakes this Despotic Protectorship over the farmer, and thus
binds him to the soil exclusively, should, when farming can no
longer support him and his children, like a real paterfamilias
see to it that the farmer does not perish of starvation. If that
cannot be done, I think it wiser to turn the beast of burden out
to grass to seek its food itself rather than to tether it to a
post and leave it there for some weeks without taking care of
it; for it is too late to learn a handicraft when there is no
To prevent trade in the countryside
is to check the growth of the population and of all cultivation,
and to prohibit handicrafts and trade is to reduce the business
of old towns and the foundation of new ones.
An experienced Tanner settled in the
country several miles from the town and served the Peasantry and
Gentry by supplying them with well curried leather. He was forbidden
by the nearest town to carry on this trade there and was ordered
to move into the town. The order was good, but the man, who had
thriven in the country, became a miserable creature in town, and
more than one thousand hides were now spoilt every year owing
to bad treatment. There you see how the National gain is increased.
That section of our Statutes which concerns
Peddling is particularly worth our attention. A trader is not
allowed to go about the country selling his goods, nor is the
Farmer allowed to buy anything from his neighbours and take it
to town, nor to bring them articles from town in return.
If the neighbour will not become his
agent, the Farmer must make a two or three days' journey to the
town himself, maybe in the busiest harvest time, and that often
for a piece of flint or an ell of tobacco. Who, then, shall pay
for his journey? Had his neighbour been allowed to trade in the
most necessary goods, he would have been spared this waste of
time, but as this is forbidden, I cannot but put his loss down
to the Account of the Statute itself.
I must regret that this Statute has
not been observed; but it is my firmest conviction that this breach
of the law has saved at least one quarter of the Country from
To set out such a great matter as this
cannot be done now. I only want to give the Reader occasion to
think about it a little.
All Savolax, Tavastland and Carelia
are situated far from any towns. Corn and provisions are their
goods, by means of which they provide themselves with salt and
other necessaries from the towns. Now the wealthier people buy
up goods from their neighbours who have no horses themselves or
are not able to go to town with those goods, and in return they
provide them with their needs.
Nobody undertakes to be an agent of
the poor, and nobody is capable of keeping accounts with fifty
or sixty persons. Thus, if this Peddling had not been done, the
Nation would have lacked those commodities, and the poor would
have perished in hunger and idleness. If the commodity is not
desired, its production will cease, and where does the National
gain come in then?
I know a Peasant living five [Swedish]
miles from the nearest town, who, amongst other peddling, buys
cattle in the autumn for slaughter over a district of several
miles around his farm, and every year he drives to town three
or four droves of cattle of twenty or thirty head each.
The law permits no other Burghers than
Butchers to go about the country to purchase cattle, but everyone
is obliged to take his own cattle to town. Few of them have more
than one or two animals to sell, which must be driven by two or
three persons, as many as the Pedlar needs for the whole drove.
These two or three persons will lose
four or five days' work each on this journey to town in a busy
harvest time, so that the transport to town will cost eight or
ten working days often for one small animal only, and that means
a deduction of 4 or 5 plåtar from the payment, and the necessary
work on the farm is being neglected. Therefore nothing is more
certain than that the farmer will eat his ox himself rather than
consume half of its value in transport expenses.
Thus, if the Statutes about peddling
were observed, the town would, through this pedlar alone, lose
fifty or sixty head of slaughter cattle a year, and of his many
droves scarcely ten oxen would reach the town, nor would his neighbours
any longer feel inclined to increase their stock. Who knows whether
the lack of corn and Victuals in the Land is not caused by these
and other similar Statutes, which are regarded as trifling matters
by most people?
I do not recommend that a farmer should
allow peddling to interfere with his farming. I would rather that
the Townspeople, who especially in winter have plenty of time
for it, would undertake to serve the country about the towns and
thus be well served at the same time themselves.
But as our towns will not do this, it
seems to me as if they wanted to be regarded as the Fathers of
the country, who order their children to assemble around their
chairs, so that each of them can put food into the children's
mouths. What a time, when the offspring have begun to order their
mother about, and the child wants to make a show of the grey hairs
of its father's head!
A merchant who is entitled to trade
freely enlarges his cares; he will be busy every moment turning
over his goods with profit. If anyone tries to gain too much,
he will get competitors, who will divide the gain and save citizens
from barefaced robbery. Everyone must then be content with less
profit on each commodity, but must instead turn it over much more
Then the interest of money will decline;
then even the small trades will be sought after, which cannot
be carried on, or even thought of, when the interest of money
is high, as they are less profitable. In a word: Monopolies, Exchange
manipulations and National loss will never occur if they are not
protected by Law; but they may be maintained after having once
got a footing.
Owing to a strange difference between
Inland Towns and Staple Towns, the foreigner is prevented from
looking for goods and paying for them in Cash in a great many
harbours. Goods must be offered to the inhabitants of the Staple
Town: if he does not want to pay for them, there is no way of
getting them sold. Diligence will then lose a good deal of its
incentive, the products will be reduced and money will begin to
leave the Country. A fine gain for the Nation!
The Product-Placat prevented foreigners
from visiting even the smaller Staple Towns with any advantage,
as they could not sell whole cargoes of their own products there
and they were not allowed to assort their goods with other goods.
There were few among these towns that had whole Cargoes of their
own Exports, so that these had to be sold in the bigger Staple
Towns. Nor were the Dutch and the English allowed to supply them
with salt, neither was it worth while to sail in ballast to Portugal
for it, but that, too, had to be bought from the bigger towns.
It is truly remarkable how trade was
drawn to a few places from other parts of the Country. True, the
name of Staple Towns remained, but the advantage had in reality
disappeared from most of them.
It would, nevertheless, have been well
enough with our trade, if at any rate the foreigner had been allowed
to trade freely in the largest towns, and by means of competition
had checked the domestic covetousness. But he finds no profit
in that after having been expelled from the salt trade, which
then fell into the hands of a few citizens, in whose discretion
it was to supply the Country with this commodity or not and at
whatever price they chose.
Thus the number of purchasers of our
Exports was reduced. The products remained in the hands of the
manufacturer or were sold to the Exporters at a loss. The loss
forced many owners to leave their works, which fell into the hands
of the Exporters or made the former tributaries to the latter.
To correct this evil the Ironmasters'
Association was founded, which was to make advances to poor Owners
of works, when iron lost its value; but everybody knows whether
these advances have fallen into the hands of the poor or the wealthy.
The coins disappeared from circulation
on the issuing of irredeemable bank-notes. Imports could not then
be paid for in cash or any coin be exported for their payment,
but everything had to be paid by Bills from Exports, which had
to be obtained from a few people for the business of the whole
Country and the Crown, who could therefore deal absolutely autocratically
with the Bills. Freedom of trade was thus suppressed, and I do
not know if it is right to accuse certain persons only of this.
The state of things was such that liberty had to be lost.
"If Caesar and Pompey," says
Montesquieu, "had thought as Cato did, others might have
thought, on the contrary, as Caesar and Pompey did." And
in another place he says: "When one gives away a title, one
knows precisely what one gives, but if one adds power to it as
well, one never knows how far that power might be extended."
Laws, Restraints, Regulations and Classifications
had then to be secured to sanction this power. The care of other
traders was confined to special goods, special places and special
times, and, moreover, these traders would be made poor and idle,
and they would make the country around them poor and idle as well.
It is strange to want to exonerate the
Product-Placat from such necessary consequences. Were not shortage
and resultant high prices predicted by the Estate of the Burgesses?
The prediction came true, and in case of general distress an attempt
was made to effect an alleviation by suspending it. Yet it is
said: "The Nation profits by the Product-Placat."
We want to run a water-mill: we have
seen that it begins to move when the dam is opened, yet we say
that it moves best when the dam is closed. Must it not be a fine
National gain that is attained by killing trade and by the misery
of the citizens?
We complain of the consequences, but
we do not want to go to the source from which they arise. As soon
as I say anything about free trade I get the answer: "We
must not mix up such private matters with public affairs."
I do not know what to say. Either we read nothing or we think
Is not the malady of Foreign Exchange
the greatest restraint of trade in the world? Can we think of
any other remedy than making trade free?
There are especially two chief remedies
for this: the first is, without respect of persons, to break the
power of those who have exercised the tyranny of Bills, so that
they are rendered incapable of doing anything more. If this cannot
be done now, it is obvious that the country has given up too much
and is now obliged to dread those weapons which it has itself
put into their hands. When power is gone, it is better to bow
The second is to repeal such Statutes
as in any way impede trade and kill industry. If every man had
the right and the opportunity to trade with the foreigner himself,
there would not be so many who were obliged to sacrifice at the
altars of the Exporters in order to be allowed to buy Bills; and
to bind them down by Laws and oaths to a reasonable price and
in that way expect the recovery of the Realm is, as I see it,
to build castles in the air.
Both these remedies are very necessary.
The second is of no use if the first does not precede it, and
the first can be of no help if the Statutes remain; for then some
others must of necessity be put in their place, and it is of small
benefit to the Nation whether the autocrat is called Caesar or
Octavius. Bad enough, when liberty is gone!
Simple though these remedies may seem
for a fluctuating rate of Exchange, yet they remain the only true
ones, without which no help can be expected.
All agree that to increase the Exports
of the Country and to get genuine coins into general circulation
will reduce the premium on foreign Bills. The former can never
be done without freedom of trade, and no other road to the acquisition
of money than that of foreign trade is known to me. If this trade
lies in the hands of a few people, similar Exchange Offices will
of necessity be kept by them, though under other names than those
spoken of before, and these offices must have the same effect
upon the Rate of Exchange.
All domestic Operations and the most
subtle Financial tricks which do not also open up foreign trade
are in my opinion as useless as such a fine artifice as a perpetuum
mobile or a water-mill that is to run by itself in a well.
The inventor of these artifices may
go as far as he likes. In the end they must stop, nevertheless.
And whoever has been most subtle in his calculations must at last
see, when his proposal is being tried, that the whole operation
has been nothing else than taking from one hand and putting into
As soon as a new trade has been discovered
in which people can be occupied, their production is thought to
be a National gain, though the trade in question does not pay
its workmen satisfactorily.
We think that the people who are drawn
to this trade did not earn anything before or had not been able
to do so, though a man who, without begging or stealing, had unfailingly
supported himself and his family in his former trade earned more
than in his new one, in which his income is scarcely enough for
himself alone, and his wife and children must trudge the streets
and live on the earnings of others.
It is quite useful for a Nation to discover
new trades; among them there might be one that was more profitable
than any of the old ones and might thus increase the National
gain. But in the long run to carry on an activity by bounties
or by constraint on other citizens will always be an infallible
loss to the Nation.
The answer that more people can live
when trades are increased is of no avail here, for it is by no
means their number that increases the gain of the Nation, but
only the value of their products, if it were only in one trade.
As long as the soil is not cultivated, the Factories lack workmen
and our workshops are empty, anxiety to carry on even more trades
is superfluous in my opinion.
Here I recall Aesop's Moral in the fable
about the Dog which, while swimming, saw the reflection of the
piece of meat in the water and tried to get hold of it, but at
the same time lost the piece it had got at the Butcher's. "He
who gapes after much," he says, "will often lose the
Neither do I consider the argument fully
valid that work should be carried on by imported workmen. For
if, at great expense to the State, they could be enticed to come
to this country to work in a less profitable trade, then, without
any expense at all to the State, thousands would have immigrated,
had they only been free to support themselves as best they could,
i.e. to carry on the trade in which they would have most increased
the real gain of the Nation.
As soon as foreigners have immigrated,
a sound Policy demands that the best should be got out of their
work, and this is infallibly to be secured in the trade that pays
its workmen the best wages, but never in those in which they must
be a burden to the State and the Public. The first they will find
for themselves; the second they will not remain in except by compulsion,
and there poverty will at last be the reward of their removal.
This conception of the National gain,
however hard it may seem to be on our new enterprises, is nevertheless
the simplest and easiest in itself.
It gives liberty to all lawful trades,
though not at the expense of the others. It protects the poorest
business and encourages diligence and free trade.
It weighs everybody in the same scales,
and gain is the right measure that shows who should have the preference.
It relieves the Government from thousands
of uneasy worries, Statutes and supervisions, when private and
National gain merge into one interest, and the harmful selfishness,
which always tries to cloak itself beneath the Statutes, can then
most surely be controlled by mutual competition.
It allows a Swede to exercise the dearest
and greatest right in Nature the Almighty has given him as man,
i.e. to support himself in the sweat of his brow in whatever way
he thinks best.
It snatches away the pillow of laziness
from the arms of those who, thanks to their Privileges, can now
safely sleep away two-thirds of their time. All expedients to
live without work will be removed and none but the diligent can
It makes a desirable reduction in our
Lawsuits. The numerous Statutes, their explanations, exceptions
and applications, which fetter trades in one way or another, will
then be unnecessary and grow silent, and when the Law is annulled,
its breach will amount to nothing.
I know well enough that these novelties
will not please many of my Readers. But they have amused me very
much and I consider it my duty to tell them to the Public, among
whom I never doubt that there are many who will honestly share
Uncertainty as to the succour of my
Native Country has made me think of this subject, and as a free
Swedish Citizen it was my duty to know the Statutes of my Country.
I compared them with each other, but I missed the consistency
which is generally to be found in a careful master's orders, i.e.
that they should all aim at one purpose.
I hear complaints of people leaving
the country and at the same time I see many arrangements that
drive them away. We want to encourage Trade, yet we prevent the
diligent workman from supporting himself. We wish that the prosperity
of the country should be promoted, and prohibit a whole Province
from buying bread, only on the pretext of stopping Smuggling.
Obedience is claimed for the orders of the Crown, but many of
these orders are several Centuries old, so that the Lawyers themselves
can recognise them only with difficulty, and sometimes they are
such that they can hardly be obeyed, if people are not to perish
We complain of an unfavourable balance
of trade, and we impede one another as much as possible in selling
our goods abroad. We want to enlarge trade, and we work for its
limitation to fifteen or twenty persons. We grow emaciated through
a high premium on foreign Bills, yet we try with all our might
to restrict Remittances to as few Drawers as possible, who besides
this already have quite an autocratic power over the Rate of Exchange.
We want to increase the National gain,
and at the same time we occupy our people with work in which they
can scarcely earn bread and water for the day. We think of Loyalty
and of reducing the number of Lawsuits, and yet we add to our
Laws daily, so that the judge himself hardly recognises them in
the Statute Book, and scarcely onehundredth of the citizens know
their duties. Just tell me, my benevolent Reader, what will finally
result from all this?
I, for my part, cannot but sing with
Lucidor, the Misanthrope:
"I hear many words, my thoughts
are far astray;
I see so many lights that I mistake my way.
Too much of arguing makes me confused, I fear,
And though I Swedish know, I know not what I hear."
I have tried in every way to analyse
one single little branch of trade and in my imagination to prescribe
the Statutes that should be laid down for it, but as soon as I
have not been led by selfconceit, I have everywhere met with insuperable
obstacles and therefore I have made no progress, especially on
account of the reasons mentioned in § 11 and the following
When I consulted experience, I soon
realised that the more liberty had been allowed to reign in a
trade, the greater was always its increase, and vice versa, and
the more evenly this liberty was distributed, the more naturally
were the trades balanced against each other.
The way in which other States treated
trades also taught me that the liberty granted was always the
measure of their greatness. But wherever I turned I saw selfishness
so well entrenched behind the Statutes that it was everywhere
difficult to exterminate it, but in most places it was quite invincible.
The more I began to measure our trades
by liberty, the more I seemed to see the possibility of encouraging
them; I was spared my trouble about the preference of the trades
and various Statutes about them. A subject which, I am convinced,
is far above human understanding and which Nature carries out
so easily itself.
One single Statute, i.e. the one to
reduce the number of our Statutes, has ever since been a pleasant
subject of work to me, which I want to recommend highly as the
very first and the most important before any new Statutes are
The aim of this small treatise is to
obtain some co-operation in this work. Opponents do not worry
me at all. The truth I have been looking for is so pleasant that
I am satisfied only with having told it to my Fellow-Citizens.
It is immovable and not affrighted, though the waves splash their
gall over it. It can stand burial by selfishness in the bottom
gravel with which enraged waves cover it, yet in spite of all
this it remains firm as a rock and irrevocable.
"Truth, O truth, thy sparkling
Penetrate the hardest stone;
Virtue's clean in thee alone.
In vain the mask conceals the face;
Thou wilt show it all the days,
Thou rewardest everyone."