The Industrial System was not defined in writing, nor was it atheory devised by authors, it was simply acted upon in practice,until the time of Stewart, who deduced it for the most part fromthe actual English practice, just as Antonio Serra deduced hissystem from a consideration of the circumstances of Venice.
Stewart's treatise, however, cannot be considered a scientificwork.The greater part of it is devoted to money, banking, thepaper circulation -- commercial crises -- the balance of trade, andthe doctrine of population: -- discussions from which even in ourday much may be learned, but which are carried on in a veryillogical and unintelligible way, and in which one and the sameidea is ten times repeated.The other branches of political economyare either superficially treated, or passed over altogether.
Neither the productive powers, nor the elements of price, arethoroughly discussed.Everywhere the author appears to have in viewonly the experiences and circumstances of England.In a word, hisbook possesses all the merits and demerits of the practice ofEngland, and of that of Colbert.The merits of the IndustrialSystem as compared with later ones, are:
1.That it clearly recognises the value of native manufacturesand their influence on native agriculture, commerce, andnavigation, and on the civilisation and power of the nation; andexpresses itself unreservedly to that effect.
2.That it indicates what is in general the right means wherebya nation which is qualified for establishing a manufacturing power,may attain a national industry.(1*)3.That it is based on the idea of 'the nation,' and regardingthe nations as individual entities, everywhere takes into accountthe national interests and national conditions.
On the other hand, this system is chargeable with the followingchief faults:
1.That it does not generally recognise the fundamentalprinciple of the industrial development of the nation and theconditions under which it can be brought into operation.
2.That it consequently would mislead peoples who live in aclimate unsuited for manufacturing, and small and uncivilisedstates and peoples, into the adoption of the protective system.
3.That it always seeks to apply protection to agriculture, andespecially to the production of raw materials -- to the injury ofagriculture -- whereas agricultural industry is sufficientlyprotected against foreign competition by the nature of things.
4.That it seeks to favour manufactures unjustly by imposingrestrictions on the export of raw materials, to the detriment ofagriculture.
5.That it does not teach the nation which has already attainedmanufacturing and commercial supremacy to preserve her ownmanufacturers and merchants from indolence, by permitting freecompetition in her own markets.
6.That in the exclusive pursuit of the political object, itignores the cosmopolitical relations of all nations, the objects ofthe whole human race; and hence would mislead governments into aprohibitory system, where a protective one would amply suffice, orimposing duties which are practically prohibitory, when moderateprotective duties would better answer the purpose.
Finally.
7.That chiefly owing to his utterly ignoring the principle ofcosmopolitanism, it does not recognise the future union of allnations, the establishment of perpetual peace, and of universalfreedom of trade, as the goal towards which all nations have tostrive, and more and more to approach.
The subsequent schools have, however, falsely reproached thissystem for considering the precious metals as the sole constituentsof wealth, whereas they are merely merchandise like all otherarticles of value; and that hence it would follow that we ought tosell as much as possible to other nations and to buy from them aslittle as possible.
As respects the former objection, it cannot be truly alleged ofeither Colbert's administration or of that of the English sinceGeorge I.that they have attached an unreasonable degree ofimportance to the importation of the precious metals.
To raise their own native manufactures, their own navigation,their foreign trade, was the aim of their commercial policy; whichindeed was chargeable with many mistakes, but which on the wholeproduced important results.We have observed that since the MethuenTreaty (1703) the English have annually exported great quantitiesof the precious metals to the East Indies, without consideringthese exports as prejudicial.
The Ministers of George I when they prohibited (in 1721) theimportation of the cotton and silk fabrics of India did not assignas a reason for that measure that a nation ought to sell as much aspossible to the foreigner, and buy as little as possible from him;that absurd idea was grafted on to the industrial system by asubsequent school; what they asserted was, that it is evident thata nation can only attain to wealth and power by the export of itsown manufactured goods, and by the import from abroad of rawmaterials and the necessaries of life.England has followed thismaxim of State policy to the present day, and by following it hasbecome rich and mighty; this maxim is the only true one for anation which has been long civilised, and which has already broughtits own agriculture to a high degree of development.
NOTES:
1.Stewart says (book 1.chapter xxix.): 'In order to promoteindustry, a nation must act as well as permit, and protect.Couldever the woollen manufacture have been introduced into France fromthe consideration of the great advantage which England had drawnfrom it.if the king had not undertaken the support of it bygranting many privileges to the undertakers, and by laying strictprohibitions on all foreign cloths? Is there any other way ofestablishing a new manufacture anywhere?'
