Colonel Torrens himself, in his earlier publications. In some respects indeed, and in some cases, the territorial division of labour, to use a term which, we believe, was first applied to international commerce by Colonel Torrens, is more beneficial than even domestic interchange. It is obvious that the advantages derived from the increased productiveness of labour, are principally enjoyed by those who consume the commodities on which that labour is employed. Where the producer is himself a consumer, he obtains a double advantage. He profits by the additional supply both of his own commodities, and of those produced by others. If coals can be produced with half the labour which they previously cost, the collier, consuming largely himself what he produces, finds himself, at a less expense, better warmed than before. But an invention which should diminish by one half the labour necessary to produce a given quantity of lace, would confer no permanent benefit on the lace-makers. If the consequence were that the demand for lace were more than doubled, their wages might rise for a short interval; until the increase in the number of hands employed in their trade reduced its profits to the former level. If that demand were less than doubled, their wages might fall until their numbers had been diminished; but when this disturbance was over, their wages would remain the same, and, as they consume no lace, they would then be entirely unaffected by the change. This is nearly the state of the bulk of the manufacturers of an opulent country. Each workman consumes no part, or a very trifling part, of what he produces, and profits almost exclusively by the improvements made by his neighbours.

A great nation, on the other hand, is almost always the principal consumer of its own products. Even of British cotton fabrics, the largest production of any single finished manufac ture, and the largest export that the world has ever seen, the British islands consume not only more than any other single country, but more than all the rest of Europe put together.

Again, the inhabitants of the same district enjoy nearly the same natural advantages. The benefits which they derive from the division of their labour arise almost exclusively from the use of machinery, and the increased dexterity and assiduity of each workman, as his field of operation is confined. International commerce adds the still greater benefits arising from varieties in soil and climate. When a Londoner buys his beer from a great brewery, instead of brewing it himself, he gains perhaps twenty per cent. But when he imports claret from Bordeaux, he gains 3000 per cent. He might brew his own beer at a guinea a barrel instead of 16s. He could not make his own claret at ninety guineas a dozen instead of three. If an individual were to cover

with glass one of the southern slopes of the Hampstead hills, and establish there a great manufactory of English Sherry, we should be almost inclined to appoint a committee on his estate. When · a Government commits acts the same in kind, its conduct excites no surprise, and little blame. It seems almost a matter of course. In many parts of the Continent where the climate resembles that of England, the British traveller is struck by a sort of cultivation which he never saw at home. The sunniest slopes, the richest bottoms, are covered by a bright green lettuce like plant, on which more manure and more attention are bestowed than on any other product, except perhaps the vine. He finds that this is tobacco, and that in order to raise it at five times the cost of importing it, the best land is sacrificed in countries where there is not room for a hedge, and iabour, where it cannot be obtained even to keep the communications between the villages passable. As he proceeds further eastward, he finds two great empires, each with a thin population-with a vast extent of fertile and imperfectly reclaimed territory, with indefinite powers of increasing their agricultural and mineral wealth,-directing the whole energy of their governments to projects for forcing their boors and miners to become cotton-spinners and weavers; and devoting to manufactures, which can be supported only by prohibitions mounted on prohibitions-by prohibiting the produce of the Zollverein, which itself can manufacture only by prohibiting the produce of Great Britain-the capital and the industry which are wanted for the ordinary trades of a civilized country.

It is a great mistake to suppose that a country which rejects the territorial division of labour, suffers merely by the greater dearness of the commodities which it is forced to produce instead of importing them. It incurs a further, and in many cases a greater, injury-in the general diminution of the efficiency of its own industry, occasioned by the misdirection of capital and the diminished division of labour. To what extent might not the agriculture of Austria be carried, if she would devote to roads and canals, and the improvement of the instruments of industry, the productive power which she is now wasting on mills and factories? But Joseph II., the founder of her commercial policy, belonged to the school of Colbert, the Emperor of China, and their pupil Colonel Torrens. He thought, that by restricting foreign trade he could bring money into the country, and resolved that his empire should no longer be tributary to foreigners. That a sovereign surrounded by manufacturers, eager to become monopolists, should have fallen into such errors, is not strange-that Colonel Torrens should have done so, is almost unaccountable.

He states that his imaginary Cuba, after having excluded one balf of all her previous imports, will retain all her previous pro-ductive powers. He forgets that she must immediately withdraw from other pursuits a portion of her capital and her industry, in order to produce at home a portion of what she formerly imported; or, if he does not forget this, he does not perceive that the general diminution of the division of labour which must be the consequence, must produce the further consequence of a general diminution of the efficiency of labour. Taking his hypothesis as he has laid it down, namely, that England and Cuba were, when Cuba first laid her duty on English cloth, precisely equal in wealth and in productive power as to every commodity except cloth and sugar; the result would be, that after Cuba had forced herself to misapply a portion of her capital and labour to the making cloth, she would, in some branches of industry, become inferior to England. Both the English producer and the Cuba consumer would find it profitable that certain commodities previously made in Cuba should be supplied from England. The labour and capital previously devoted to them in Cuba might be employed in the production of cloth; and part of the labour and capital previously devoted, in England, to the production of cloth for Cuba, might now be devoted to the production of these substituted articles. In such a case, no money need pass, and Colonel Torrens's vast superstructure falls.

He is entitled, however, to amend his hypothesis, and to suppose that the 100 per cent duty is imposed in Cuba upon every English commodity except money. Under such circumstances, Cuba would be forced to withdraw from other employments labour and capital, to be employed in making cloth, and could not supply their place by importation; and England would have to find an employment for the labour and capital now no longer wanted to make cloth for Cuba, and could not find it in the production of any other consumable commodity for that market.

The result, in each case, appears to us to be clear. The second of the two great errors, of which we have accused Colonel Torrens, consists in his having omitted to state it.

It is obvious that the capital and labour in England, which could no longer be employed in their accustomed trade of supplying cloth for the Cuba market, would be employed in the new trade of procuring and exporting the precious metals to Cuba; and that the capital and labour which would now be wanted in Cuba, in order to make the cloth formerly imported from England, would in fact be obtained by applying to that purpose the capital and labour formerly employed in procuring

the precious metals. In short, that the result of the restrictions laid by Cuba on her commerce with England, would be to turn some of the English clothiers into miners, and some of the Cuba miners into clothiers.

The possibility of such a result, however, is not alluded to by Colonel Torrens. He does not admit that either of his two imaginary countries, which, it is to be recollected, represent the whole commercial world, could increase its stock of money except by taking from that of the other. He does not admit that the value of the currency of either is connected with its cost of production. He seems to suppose that some unknown agent has thrown into the commercial world a certain amount of the precious metals, incapable of increase or diminution, and depending for its value on its quantity.

Many of our readers may think that no answer need be made to the theory, that the local value of the precious metals depends on what Colonel Torrens calls their distribution; that is to say, on the comparative amount of them in each country. But that theory is favoured by Mr Ricardo in some unguarded passages, particularly in his chapter on foreign trade-a chapter containing the germ of most of the errors which have expanded themselves so vigorously in the writings of Colonel Torrens. It is maintained in express terms by the late Mr Mill; with the addition that any increase or diminution of the rapidity with which the money of a country circulates, produces the same effects as the increase or diminution of its quantity. An opinion so supported cannot therefore be safely neglected.

Yet it is an opinion that seems refuted as soon as it is explicitly stated. No one will maintain that gold and silver differ from the other metals, except in their greater scarcity and durability; or that their attributes are changed the instant they are divided into portions of a given weight and authenticated by a stamp. But if we were asked, why does one ton of copper generally exchange for five of lead-we should immediately answer, for the same reason which causes one bushel of wheat generally to exchange for two bushels of barley; namely, that it costs as much in wages and profits, or, to use another nomenclature, in labour and abstinence, to produce one ton of copper as five tons of lead, and one bushel of wheat as two bushels of barley.

There is probably more than fifty times as much gold in use in Europe as there is platina; but yet gold is five times as valu

Mill's Elements of Political Economy, 3d edition, s. 7.

able as platina. There is about forty-seven times as much silver as there is gold; but gold is not quite sixteen times as valuable as silver. Again, it is probable that silver changes hands ten times as often as gold; but no one seriously supposes that this cause affects the comparative value of the two metals. Cost of production, the cause which decides the value of any other commodity not the subject of a monopoly, must decide the value of the precious metals.

We will endeavour to show in detail how this takes place under the simplest circumstances.

We will suppose an insulated society of 10,000 families, having an abundance of fertile land, and using manufactures so rude, that the trifling capital employed by them may be disregarded, and so equal in fortune and rank, that the relations of landlord and tenant, and capitalist and workman, shall not exist. We will suppose gold alone to be their money, and that it is obtained by washing alluvial deposits without any expensive machinery or skill, and always in the same ratio to the labour employed.

The cost of producing gold would, under these circumstances, always remain the same; and its value in labour, or, in other words, the amount of labour which a certain quantity of it could purchase, would always correspond with its cost of production; except for short intervals, when any sudden increase or diminution in the demand for it, should occasion the existing supply to be for a time relatively excessive or deficient. Under such circumstances, the value of all other things would be estimated by comparing their cost of production with that of gold. If the labour of a family employed for a year, could gather from the washing-places fifty ounces of gold, and, by equal exertion, gather from the spontaneous produce of the fields fifty quarters of rice, the rice and the gold would be of equal value, and a single quarter of rice would be worth an ounce of gold. If the same labour could produce, in the same time, one hundred ounces of gold instead of fifty, a quarter of rice would be worth two ounces instead of one; or if the same labour could gather one hundred quarters of rice instead of fifty, a quarter of rice would be worth only half an ounce instead of a whole ounce ; but while a year's labour could produce just fifty ounces of gold, the yearly income of each family, however employed, supposing their diligence, strength, and skill equal, would be of the value of precisely fifty ounces of gold.

The quantity of gold produced would depend partly on the quantity wanted for plate-including, under that word, all use of gold except as money-and partly on the quantity wanted for money. The quantity wanted for plate would of course depend on

VOL. LXXVIII, NO. CLVII.

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