Effects of the Corn Laws
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Thomas Malthus >> Effects of the Corn Laws
But the fact is that the whole difference of price does not by any
means arise solely from taxation. A part of it, and I should think,
no inconsiderable part, is occasioned by the necessity of yearly
cultivating and improving more poor land, to provide for the demands
of an increasing population; which land must of course require more
labour and dressing, and expense of all kinds in its cultivation.
The growing price of corn therefore, independently of all taxation,
is probably higher than in the rest of Europe; and this circumstance
not only increases the sacrifice that must be made for an
independent supply, but enhances the difficulty of framing a
legislative provision to secure it.
When the former very high duties upon the importation of foreign
grain were imposed, accompanied by the grant of a bounty, the
growing price of corn in this country was not higher than in the
rest of Europe; and the stimulus given to agriculture by these laws
aided by other favourable circumstances occasioned so redundant a
growth, that the average price of corn was not affected by the
prices of importation. Almost the only sacrifice made in this case
was the small rise of price occasioned by the bounty on its first
establishment, which, after it had increased operated as a stimulus
to cultivation, terminated in a period of cheapness.
If we were to attempt to pursue the same system in a very different
state of the country, by raising the importation prices and the
bounty in proportion to the fall in the value of money, the effects
of the measure might bear very little resemblance to those which
took place before. Since 1740 Great Britain has added nearly four
millions and a half to her population, and with the addition of
Ireland probably eight millions, a greater proportion I believe than
in any other country in Europe; and from the structure of our
society and the great increase of the middle classes, the demands
for the products of pasture have probably been augmented in a still
greater proportion. Under these circumstances it is scarcely
conceivable that any effects could make us again export corn to the
same comparative extent as in the middle of the last century. An
increase of the bounty in proportion to the fall in the value of
money, would certainly not be sufficient; and probably nothing could
accomplish it but such an excessive premium upon exportation, as
would at once stop the progress of the population and foreign
commerce of the country, in order to let the produce of corn get
before it.
In the present state of things then we must necessarily give up the
idea of creating a large average surplus. And yet very high duties
upon importation, operating alone, are peculiarly liable to occasion
great fluctuations of price. It has been already stated, that after
they have succeeded in producing an independent supply by steady
high prices, an abundant crop which cannot be relieved by
exportation, must occasion a very sudden fall.(4*) Should this
continue a second or third year, it would unquestionably discourage
cultivation, and the country would again become partially dependent.
The necessity of importing foreign corn would of course again raise
the price of importation, and the same causes might make a similar
fall and a subsequent rise recur; and thus prices would tend to
vibrate between the high prices occasioned by the high duties on
importation and the low prices occasioned by a glut which could not
be relieved by exportation.
It is under these difficulties that the parliament is called upon to
legislate. On account of the deliberation which the subject
naturally requires, but more particularly on account of the present
uncertain state of the currency, it would be desirable to delay any
final regulation. Should it however be determined to proceed
immediately to a revision of the present laws, in order to render
them more efficacious, there would be some obvious advantages, both
as a temporary and permanent measure, in giving to the restrictions
the form of a constant duty upon foreign corn, not to act as a
prohibition, but as a protecting, and at the same time, profitable
tax. And with a view to prevent the great fall that might be
occasioned by a glut, under the circumstances before adverted to,
but not to create an average surplus, the old bounty might be
continued, and allowed to operate in the same way as the duty at all
times, except in extreme cases.
These regulations would be extremely simple and obvious in their
operations, would give greater certainty to the foreign grower,
afford a profitable tax to the government, and would be less
affected even by the expected improvement of the currency, than high
importation prices founded upon any past average.(5*)
NOTES:
1. From the reign of Edward III to the reign of Henry VII, a day's
earnings, in corn, rose from a pack to near half a bushel, and from
Henry VII to the end of Elizabeth, it fell from near half a bushel
to little more than half a peck.
2. Wealth of Nations, b. iv, c. 2, p. 202.
3. The cheapness of corn, during the first half of the last century,
was rather oddly mistaken by Dr. Smith for a rise in the value of
silver. That it was owing to peculiar abundance was obvious, from
all other commodities rising instead of falling.
4. The sudden fall of the price of corn this year seems to be a case
precisely to point. It should be recollected however that quantity
always in some degree balances cheapness.
5. Since sending the above to the press I have heard of the new
resolutions that are to be proposed. The machinery seems to be a
little complicated, but if it will work easily and well, they are
greatly preferable to those which were suggested last year.
To the free exportation asked, no rational objection can of course
be made, though its efficiency in the present state of things may be
doubted. With regard to the duties, if any be imposed, there must
always be a queston of degree. The principal objection which I see to
the present scale, is that with an average price of corn in the
actual state of the currency, there will be a pretty strong
competition of foreign grain; whereas with an average price on the
restoration of the currency, foreign competition will be absolutely
and entirely excluded.
[Transcriber's note: The sentence
It is alleged, first, that security is of still more importance than
wealth, and that a great country likely to excite the jealousy of
others, if it become dependent for the support of any
considerable portion of people upon foreign corn, exposes itself to
the risk of having its most essential supplies suddenly fail at the
time of its greatest need.
originally read:
It is alleged, first, that security is of still more importance than
wealth, and that a great country likely to excite the jealousy of
others, if its it become dependent for the support of any
considerable portion of people upon foreign corn, exposes itself to
the risk of having its most essential supplies suddenly fail at the
time of its greatest need.
This was probably a printer's error.]