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1

Shewing the Impolicy of the

PRESENT LEGAL RESTRAINTS

P E C U N I A R Y B A R G A I N S .

S E R I E S OF L E T T E R S TO A FI!lrX-

* % !

7'6 W I i t C H IS A D D E D * *m* ' 9 e T 1 - - '-, t

A L E T T E a T ; - , ' , A .N

/

,. T 0 '. 4 ,'l'

/'

A D A M S M I T H , Efq; L L ~

On the Difcouragements oppofed by the above ReRraints to the Progrefs of

I N V E N T I V E I N D U S T R Y .

B Y

JEREMY BENTHAM, of Lincoln's Inn, Efq.

L O N D O N : P R ~ N T B D ? O R T. P A Y N E , A N D SON,

AT T H E MEWS G A T E .

- C O N T E N T S .

L E T T E R I;

INPRODUCTION -- Page I

L E T T E R 11.

Rca/om for Re&aint. - Prtvtntion of

WY - 6

L E T T E R

Rea/ons for R@raint. - Prevention fl Prodigality - . I 6

C O N T E N T S . i

L E T T E R IV.

R@ns for Rgra in t . - ProteDion of 1 Indigence - ,Page 32

L E T 'I' E R V.

Reafins for Xrflraint. - Protct7ion of

Simplicity. - - 39

L E T T E R VI.

Mi/cbiefJ ofthe anli ufuriou~ Laws 45 ~ \

I, E T T E R VII.

L E T T E R X. -

Grounds af )be Pr+iica again# U f i 9 4

L E T T E R XI.

Compound Intere) - I 10

L E T T E R XII.

Mainlenance and Champerty - I I 7.

LET-

C O N T E N T S .

L E T T E R XIII:

r o Dr. St?~itb, ~ l r P r g i t ~ ~ in &:S,

WC. - - Page 129 0

E R R A T U M .

P. I SO, 1, 14,/1r one read o ~ t ;

D E F E N C E

D E F E N C E OF US:U-R.Y.

. . L E T T E R I,

Cricboff, in mltr R e , Yauag 1717.

A MONG the various fpecies or modi6cations of libercy,of which

on different occafions we have heard fo much in E n g l a d , I do not recojlelt ever feeing any thing yet offered in behalf of the liberty af making ant's own terms in money-bargains. From fo general ind univerial a ncgleet, it is an old notion of mine, as you well know, that this meek and unaflurning fpecies of liberty has been fuffering much in- jultice.

B A fancy

A fancy has taken me, juR now, to ~ trouble you with my mafoqs : which, if you think them capable of aniiver- ing any good purpofe, you may for- ward to the prefs: or in the other care, what will give you lefs trouble, to t h e fire.

In a word, the propofition I have been accufiomed to lay down to myfelf on this Cubje&t is the foliowing one, viz. that no man of rzjxyears and of fiund mind, aning freeb, and witb his ges open, ought to be bindered, wifb a view to his advantage, from making ficb bargain, in tbe way of obtaining mang, as be tbinksfil : nor, (what is a necef- fary con fequence) any body kinderedfiom Juppbirzg him, upon any terms he thizks proper to accede to.

This propofition, were it to be re- ceived, would level, you fee, at one firoke, all the barriers which law,either

# ftatute

fiatute or common, have in their unit- ed wifdorn let up, either againit. the crying fin of Ufury, or againR the hard-named and little-heard-of prahice of Champerry; to which we muR alfo add a portion of the multifarious, and as little-heard-of oEence, of Maintc: nance.

On this occafion, were it any indi-' vidual antagonifi I had to deal with,

! my part would be a Cmoothr and cafy one. " You, who fetter contraes ; " you, who lay rcfiraints on the liber- " ty of man, it is for you " (I fhould fay) " to allign a reafon for your d&

b " ing Co." That contraas in general ought to be obferved, is a rule, the propriety of which, no man was ever yet found wrong- headed enough to deny : if this cafe is one of the cxcep tions (for Come doubtlds there are) which the fafcty and welfare of eve rg

8 4 ibcietr

fociety require ihould be taken o a of that general rule, in this cak, as ia a11 thokothers, it lies upon him, who alledges the necefity of the exception, to produce a reafon for it. ~

This, I fay, would be a fhort and very eafy method with an individual : but, as the world has no mouth of its own to plead by, no certain attorney by which it can " come and defend *c this force and injury," I muft even find arguments for it at a venture, and ranrack my own imagination for fuch phantoms as I can find to fight with.

I n favour of the refiraints oppofed to the fpecies of liberty I contend for, I can imagine but five arguments.

1. Prevention of uf~iry-

2. Prevention of prodigality:

3. ~rotettion . , of indigence again& extortion.

4. Red

ReprcEon of the temerity of projeaors.

5. Proteaion of Iimplicity againlt: impofition,

<.

Of all thek in their order.

33 3 . LET-

L E T T E R XI.

Will begin with the prevention of l ujiur~ : becaufe in the found of the word uJury lies, I take it, the main

. firength of the argument : or, to fpeak firi€tly, of what is of more importance than all argument, of the hold which the opinion I am combating has ob- tained on the imaginations and pafions

4 of mankind.

Ufury is a bad thing, and as fuch ought to be prevented : uiurers arc a bad fort of men, a very bad fort of men, and as fuch pught to be punifh- cd and fuppreffed. Thefe are among

the

,the Rring of propofitions ,which every man finds handed down to him from his progenitors : which mofi men are . difpofed to accede to without examina- tion,and indeednot unnaturally nor even unreafonably difpofed, for it is impof- fiblc the bulk of mankind ihould find leifure, .had they-the ability, to exa- mine into the grounds of an hundredth part of the rules and maxims, which *ey find themfelves obliged to a& up- on. Very good apology this for John Trot : but a little more inquifitivencfi may be required of legiflators.

You, my friend, by whom the true force of words is fo well underfiood, have, I am h e , gone before me in perceiving, that to fay ufury is a thing to be prevented, is neither more or lcfs than begging the matter in queftion. I- know of but two definitions tha t

can poflibly be given of ufury : one is, B 4 the

8 LETT. 1b &fa fm hjraint. the taking of a greater interefi than the low allows of: this may be itiled the pEitical or l@ definition. The other is tbe taking oEH pater interefi than i t is dual for men to give and take : this may be Rikd tbe mord one : and this, where the law has not interfered, is piahaly enough the anly one. 11 is plain, that in order far ufury te be pra- hibited by law, a poiitivc defcription mqfi have been found for it by law,

f i x i n s or rather fuperfeding, the cm- rid -. To fay then that dury is a thing that aught to be prqvented, is faying neither rnqre nor lefs, than that tb utllnofi ram d intcreit which Oral1 be taken ought to be fixed ; and that fixaiion enforced by penalties, or fuch ather means, if any, as may anfwer the purpofe of preventing the breach of it. A law punihing ufury fuppores,, there- fwe, a law fixing the allowed legal

rate

rate of intercit : and the propriety of '

the penal law mu& depend upon the propriety of the fimply-prohibitive, or, if you pleare, declaratory one.

One thing then is plain ; that, anted cedently to cufiom gmwing from con- vention, there cah be no lich thing as uhry .: f& what rate of intereit is rhek that can naturally be more pro- per than another ? what natural fixed price can there be for the uk of money. more than for the uk of any other thing ? Were it not then for. cuftom, ufury, canMered in a moral view,

not then fo r&c h as admit of a definition : fo far from having exifience, it would not fo much as be conceivd abk: nor therefore could the law,. in '

the definition it took upon itfelf to give of fuch ofFence, have fo much a s a guide to Aeer by. CuRom there- fore is the folc bafis, which, either t h e

moraliR

10 LETT.'II. Reajns for Rgraint. moralilt in his rules and precepts, or m he leginator in his ,injun&ions, can 3ave to build upon. But what bafis can be more weak or unwarrantable, as a ground, for coercive meafures, than cufiorn refulting from free choice ? My neighbours, being at li- berty, have happened to concur among the.mfe1ves in dealing at a certain rate of interefi. I, who have money to lend, and Titius, who wants to borrow it of me, would be glad, the one of us to accept, the other to give, an i n t e d brnewhat higher than theirs : why is the liberty they exercifk to be made a yretegce for,depriviag me and Titius of ours ? : N o r has blind cufiom, thus made the iole and arbitrary guide, any thing of fieadinefs or uniformity in its deci- fions : it has varied, from age to age, in the fame country : it varies, from

country

country to country, in the fame.age: and the legal rate has varied along with i t : and indeed, with regard to times paft, it is from the legal rate, more rea- dily than from any other fource, that we colleEr the cuftomary. Among the Romzns, till the time of JuRinian, we find it as high as 12 per cent. : in Eng- land, fo late as the time of Hen. VIII, we find it at 10 per cent. : fucceeding itatutes reduced it td 8, then to 6, and lafily to 5, where it itands at prefent. Even at prefent in Ireland it is at 6 per cent.; and in the Weft Indies at 8 per cent.; and'in Hindoftan, whcre there is no rate limited by law, the lowefi cur+ romary rate is 10 or 12. A t Conftan- tinople, in certain caks, as I have been b e l l informed, t'hi;ty per cent. is a common rate. Now, of all there widely 'different rates, what one is' there, that is intrinhcally more proper than anb-

. . ther ?

i 2 Lam. 11. Reafinsfor ReJraini. ther ?What is it that evidences this pro- priety in each infiance? what but the mutual convenience-of the parties, as manifefied by their confent? I t is .con- venience then that has produced what- ever there-has been of cufiorn in the marter :What can there then be in CUT- tom, to maki it a better guide'tban the convenience which gave it birth ? and what is there in convenience, that

. ihould make it a worre guide in one tafe than in another? I t would be convenient to me to give 6 per cent. for money : I arid to do fo. U No," (rays the 1 a ~ ) ' ' ~ o u Ihan't."-Why fo? 6 c Becaufe it is not convenient to your (C neighbour to give above 5 for it." Can any thing be more'abfurd than fuch a reafo~ ?

Much has not been done, I think, by legiflators as yet in the way of fix- ing the price of other commodities :

and,

and, in what little has been done, thq probity of the intention has, I believe, in generd, been rather more unqueii- tionable than the reaitude of the prin- ciple, or the felicity of the refult. Put- ting money out at intereit, is exchang- ing prefent money for future : but-why . a policy, which, as applied to ex- changes in general, would be generally *deemed abiiurd and miichievous, hould be deemed neceffary in the infiance of this particular kind of exchange, man- kind are as yet to learn. For him who takes as mucl1 as he can get for the uiie of any other fort of thing, an houfe for infiance, there is M) particular ap- pellation, nor any mark of difrepute : nobody is a@amed of doing iio, nor is it ufual ib much as to profefs to da otherwik Why a man who takes as much as he can get, be it fix, or feven, W eight, or ten per .cent. for the ufe

.of

I q LBTT. 11. Reajns for Refiain:. of a rum of money fhould be called ufurer, fhould be loaded with an op- probrious name, any more than if he had bought a houfe with it, and made a proportionable profit by the houfe, is more than I can fee.

Another thing I would alfo w i k to learn, is, why the 'legillator fhould be more anxious to limit the rate of in- terelt one way, than the other ? why he ihould fet his face againit the own- ers of that fpecies of property more than of any other? why he fhould make it his bufinefi to prevent their getting nwrc than a certain price for the ufe of it, rather than to prevent their getting l$ ? why, in fhort, he lhould not take means for making it penal to offer lefs, for example, than 5 per cent. as well as to accept more ? Let any one that can, find an anfwer to there queRions ; it is more than I can

8 do :

Prevention of U/uy. I S do : I except always the diitant and imperceptible advantage, o f Iinking the price of goods o f a11 kinds ; and, in that remote way, multiplying the future enjoyments, of individuals. But this was a confideration by far too diC- tsnt and refined, to have been the original ground for confining the limi- tation to this Bde. '.

Reofin$ for ~@rainr . -~revenf ion of Prodigality, l

H A V I N G done with founds, I come gladly to propofitions ;

which, as far as they are true i n poinc of fa&, may deferve the name of rea- ions. And firft, as to the efficacy of fuch refiriaive laws with regard to the prevention of prodigaliiy.

That prodigality is a bad thing, and that the prevention of it is a pro- per obje€t for the legiflator to propofe. to himfelf, h long as he confines him felf to, what I look upon as, proper meaiures, I have no objeaion to allow, ' I

at leaft for the purpofe of the argu- .

5 mcnt ;

Preu~ntion of Prodigality. I 7:

ment ; though, were this the principal queltion, I lhould look upon i t as in- cumbent on me to place in a fair light the reafons there may be for doubting,, how far, with regard to a per.fon arriv- ed at the age of difcretion, third per- ions may be competent judges, which of two pains may be of greater force and value to him, the prefent pain of refiraining his prefent defires, or the future contingent pain he may be ex- pofrd to fuffer from the want to which the expence of gratifying thek defires. may hereafter have reduced him. To prevent our doing mifchief to one ano- ther, it is. but too neceffary to put- bridles into all our mouths : i t is ne- cerary to the tranquillity and very be-. ing of fociety: but that the tacking of leading-itrings upon the backs o f ' g r a m pcrfms, in order. to prevent

C their

I 8 LEYT. f 11. Reajd for &?raint. their doing thernfelves a rnifchief, is not neceirary either to the being o r tranquillity of fociery, however condu- cive to its well-being, I think cannat be diiputed. Such paternal, or, if you pleafe, maternal, care, may be a good work, but it certainly is but a work of fupererogation.

For my own part, I milR confefi, that fo long as fuch methods only are employed, as to me appear proper ones, and fuch there are, I ihould not f&l myfelf difinclined to fee forne meafures taken for the refiraining of' prodigality : but this I can not look upon as being of the n-umber. My reafons I will now endeavour to lay be- fore you h the fire place, I take it, that it is

neither natural nor ufual for prodigals, as fuch, to betake themfelves to this

method,

Prme~~rion of Prodigal@. 19

method, I mean, that of giving a rate of interefi above the ordinary one, to ' fupply their wants.

In the -firit place, no man, I hope \

you will allow, prodigal or not prodi- gal, ever thinks of borrowing money to

fpend, fo long as he has ready money . of his own, or effeRs which he can turn into ready money without lofs. And this deduaion itrikes off whar, I fuppofe, you will look upon as the greatefi proportion of the perfons fub- je&, at any given time, to the imputa- tion o f prodigality. a

I n the next place, no man, in f~rch a country as Great Britain at leait, has mcafion, nor is at all likely, to take up moncy at an extraordinary rate of intereit, who has iecurity to give, equal to that upon which money is common- .

ly to be had at the higheit ordinary race. While fo many advertife, as are

C 2 to

20 LETT. 111. Rea/dn~ for Rqfraint. to be feen every day advertifing, money to be lent at five per cent. what ihould poffcfs a man, who has any thing to of- fer that can be called a fecurity, to give, for cxarnple, fix per cent. is more than I can conceive.

You may fay, perhaps, that a man who wiihes to lend his money out up- on fecurity, wiihes to have his interea pun&ually, and that without the ex- peoce, and hazard, and trouble, and odium of going to law; and that, on this account,, it is better to have a h- ber man to deal with rhan a prodigal. So far I allow you ; but were you to

.add, tha t cn this account it would be ncceffary for a prodigal to offer more rhan another man, there I ihould diia- gieewithyou. In the firit place, it is not io eafy a thing, nor, I take it, a

- common thing, for the lender upon frcurity to be able to judge, or even

to

Prevention of Prodigality. 2 2 to form any attempt to judge, whether the condua of one who offcrs' to bor- row his money is or is not of fuch a cait, as to bring him under this de- fcription: The queition, prodigal or not prodigal, depends upon two pieces of information ; neither of whicl~, in general, is very eaiy to come at : on the one hand, the amount of his means and reaionable expeaations ; on the other hand, the amount of his ex- penditure. The goodners or badnefs of the iecurity is a queition of a very different nature : upon this head, every man has a known and ready means of obtaining that fort of inbrmatioo, which is the moit Otisfaffory the nz- ture of things affords, by going to his Sawyer. ' It is accordingly, I take it,

on their lawyers opinion, that lenders in general found their determination i n rhefe cafes, and not .upon any calcu-

c 3 lations . ,

'22 LETT. 111. Reajrrsfor R@rainr, lations they may have formed, con- cerning the receipt and expenditure of the borrower. But even fuppofing a man's dirpofition to prodigality to be ever fo well known, I take it there are always enough to be found, to whom fuch a difpofition would be rather an inducement than an objeCtion, fo long as they were fatisfied with the kcurity. Every body knows the advantage t o be made in cafe of mortgage, by fore- cloling or forcing a fale : and that this advantage is not uncommonly looked out for, will, I believe, hardly be doubted by any one, who has had any occalion to obferve the courfe of bufi- aefs in the court of Chancery.

In'fhort, fo long as a prodigal has any thing to pjedge, or to dirpofe of, whe- ther in poffefion, or even in reverfion, whether of a certain or even of a con- tingent nature, I fee not, how he can'

receive

Pratn~iotl of Prodigaljty. 2 3 .receive the fmalleit benefit, from m y laws that are, or can be made to fix the rate of interefi. For, fuppofe the law to be efficacious as far as it goes, and that the prodigal can find none of thofe monfiers called ufurers to deal with him, does he lie quiet? No fuch thing : he goes on and gets the money he wants, by Celling his interefl infiead of borrowing. H e goes on, I fay : for if .he has prudence enough to fiop him any where, he is not that fort of man, whom it can be worth while for the law to attempt flopping by fuch means. It is plain enough then, I take it, that m a prodigal thus circumfianced, the law cannot be of any fervice ; on the contrary, it may, and i n many cafes muit, be of diKervice to him, by deny- ing him the option of a refource, which, how diradvantageoos foever, could not well have proved more fo,

c 4 but

,24 LETT. 111. Reajnsfor Rflraint,

but would naturally have proved 14s I

fo, than thofe which it leaves fiill open #

to him. But of this hereafter. I now come to the only remaining

.clafs of prodigals, viz. thofe who have

i nothing that can be,cailed a fecurity to offer. Thefe, I take it, arc not more likely to get .money upon an extraor- dinary rate of interofi, than an ordina- ry one. Perfons who :either feel, o r .find rcafons for pretending to feel, .a friendhip for the borrower, can not , .take of him more than the ordinary rate of intckfi : perfons, who have no fuch mori.ve.for.lending him, will not lend him at all. .If they know him 1 for what he is, that will prevent them of courfe: and even thougll they 1 -ihould know nothing of him by anly I

other circumfiance, the very circum- I

fiance of his not being able to find a ;friend to trufi him at the.higheit ordi- l

..n a c3

' Prevention of Prodigality. t 5 :nary rate, will be fufficient reafon to a itranger for looking upon him as a .man, who, in the judgment of his friends, is .not likely to pay.

The way that prodigals run into .debt, afier they have fpent their fub- fiance, is, I take it, by borrowing of their friends and acquaintance, at ordi- .nary intereit, or more commonly at no interetl, h a l l fums, fuch as each man may be content.to lofe, or be aihamad .to afk real fccurity for; and as pro- .digals have generally an extenfive ac- .quaintance (extegfive acquaintance bc- ing at once the cauE and effetk of

,prpdigality),- the fum total of the mo- ney a man may thus find means EO

,fquander,.may be confiderable, though .each fum borrowed may, relatively to

v ..the.circumfiances of the lender, have -been inconfiderable. This I take to me .the race which .prodigals, who have

.(pent

a6 LBTT. 111. 1Pca$im ~ O T ReJraint. '

f ~ n t their all, run at prefent, under the prefent fyfiem of refiraining laws : and this, and no other, I take it,

would be the race they would run, ware thofe laws out of the way.

Another confideration there is, 1 think, which will compleat your con- viaion, if ic was not compleat before, of the inefficacy of theie laws, as to the puttiag any fort of reftraint upon pro- digality. Tbis is, that there is aao-

ther fet of people from whom prodi- gals get what they want, and always will get it, fo long as credit laits, in fpire cd all laws againt high inter& ; and, Q~ould they find it necfiry, a t an expence more than equal to any ex- cefs of interei't they might otherwife ,have to give. I mean the tradefrnen who deal in the goods they want. Every body knows it ,is much eafier ro get goods than money. People truR

goods

goods upon much flenderer fecurity rhan they do money : it is very natural they h d d do io : ordinary profit of trade upon the whole capital employed in a man's trade, even after the ex+ pence of warehoufe-rent, journeymen's wages, and other Cuch general cliargcs, are taken into the account, and Cet againit it, is at leaft equal to double ioterceft ; Isy 10 per cent. Ordinary pm- fic upon any particular parcel of goods mu& therefore be a gmat deal more, fay at 1eaR triple intesdt, 15 per cent. : i'n the way of trading, then, a man 'can afford to be at leait three times 4.5 adventurous, as he can in the way of landiqg, and with equal pru- dence. So iong, thw, as a man is looked upon .as one who will pay, he can much eafierget thegoads he wants, rhan he could the momy to buy them

.with, ~ ! o u g h .he were content to give for

oB LETT;III. ~ta&fmRflrnin~t. for it twice, or even thrice the ordina y rate of interefi.

SuppoGng any body, for the fake of extraordinary gain, to be willing to run the riflc of fupplying him, although they did not look upon his perfonal iecurity to be equal to that of another man, and for the fake of the eitraor- dinary profit to run the extraordinary riik ; in the trader, in ihorc in every 'fort of trader whom he was accultom- ed to deal with in his Colvent days, he fees a perfon who may accept of any rate of profit, without the fmallefi dan- ger from any laws that are, or can be -made againfi ufury. How idle, then, t o think of flopping a man from mak- ing fix, OT feven, or eight per cent. in- -terefi, when, if he chufes to run a r j k proportionable, he may in this way make thirty or forty per cent. or any rase you pleafe. And as to the prodi-

gal, ,

Prevention of Prodilp.ality.' 2%

gal, if he cannat get what he .wants upon thefe terms, what chance is there. of his getting it upon any terms, cup- poiing the laws againit uiury to be away? This then is another way, in which, infiead of ferving, it injures , 1

him, by narrowing his option, and driving him from a market which might have proved lefs difadvantage- ous, to a more difadvantageous one.

As far as prodigality, then, is con- cerned, I muit confers, I cannot k e t h e ufe of flopping the current of expen- diture in this way at the foKet, when. there are fo many unpreventable ways. of letting it run out at the bung-hole.

W k t h e r any harm is done to fociety, .

u p o n the whole, by letting fo much money drop at once out of the pockets. of he prodigal, who would have gone o n waiting it, into the till of the frugal tradcfman, who will lay i t up, is oot

worth

worth the enquiry for the prefenc pur- pofe: what is plain is, that, fo far as

1 Q e raving the prodigal from paying at I an extraordinary rate for what he gets

ro fpend, is the objea of the law, that , objea is not at all promoted, by fixing 1 the rate of incerefi upon money bor-

I rowed. On the contrary, if the law has any effea, it runs counter to rhat

, objee: fince, were he to borrow, it would only be, in as far as he could borrow at a rare inferior to that at

which otherwife he would be obliged to buy. Preventing his borrowing at an extra rate, may have the cffeff of increafing his difirefs, but cannot have the effer.9 of leifening it: allowing his borrowing at fueh a rate, might have the eKe& of leffening his diffreij, but could not have the effe& of incriaf- ' ing it.

To put a fiop to prodigality, if in-

4 deed

Prevention of Prodigality. 3 r deed it be worth while, I know but of one cffeltual courfe that can be taken, in addition to the:incompleat and in- fufficient courfes a t prdent pra€ticable, and that is, to put the convitled prodi- gal under an inferdik?, as was prattifed formerly among the Romans, and is itill praaifed among the French, and other nations who.have taken the Ro- man law for the ground-work of theit own. But to difcds the expediency, or ketch out the details of fuch an in- i t i t u t i o~ ; belongs aot m the p r c h ~ U F P O ~ .

3.2. LETT. IV. Reafins for Re$raint..

L E T T E R 1V:

Rca/oiu for Rg?raint.-ProteBion of fi~digetlse.

B ESIDES prodigals, t'herc are three other claffes of perfons, and bue

three, forwh e fecurity Icanconceive e' thefe refirittive laws to have been de-. figned.. I mean the indigent, the raih- ly enterprizing, and the iimple : thole. whofe pecuniary necefiities may dif- pore themf to give an inrereit above the ordinary rate, rather than not have it, and thofe who,.from ra@ners, may be difpofed to venture upon giving fuch. a rate, or from careleffnefs combined with ignorance, may be difpofid to acquiercc in it.

*

Protctlion of Indigence. 3 3

In fpcaking of thefe three different clages of perfons, I mufi beg leave to confider one of them at a time : and accordingly, in fpeaking of the indi- gent, I nluR confider indigence in the firit place as untinaured with fimpli- city. On this occafion, I may fuppofe, and ought to fuppofe, no particular defe& in o man's judgment, or his temper, that ihould miflead him, more than the ordinary run of men. H c knows what is his interefi as well as they do, and is as well difpofed aid able to purfue it as they are.

I have already intimated, what I think is undeniable, that thereare noone or two or other limited number of rates of interefi, that can be equally iuited to the unlimited number of fituations, . in refpea of the degree of ixigeng, in which a man is liable to find himfelf: inlon~uch that to the iituation of a man,

D who

3 LXTT. IV. &afiru for ReJraint. who by the ufc of money can make for mmB1Q I L per cent, fix per cent. is W well adapted, as 5 per cent. is to the Iiruutien oi him who can make bus h 6 ; to, that of him w h o cao make ~2

per cent,fien, and Soan. So, in the caCe of his wanting ir to fave him616 fronr a lors, (which is that w h i h is moft likely te be in view under the

OE ~AS&K~.) if that lols wcntld amounr to I r per cent. 6 per cent. is as wel l adapted to his P t a a t i o ~ as 5 p= ccnl. would he to the fituaim of him, who W~ btlt &.l& a m o u h g ro ren per. cent. ~ b v a himklf f r m by chc like meam And in any c&, &hough, io propo~tion Eo the amunt

d >loii, the nato of inter& i em . even fb great, as chat r k clcac fiving h o d d nut amount m more thui'one per cent, or any fMim per cent. get h l a g as it amumd m any thing, he

would

would be jufi io much the better for borrowing, even on fuch comparative- fy dKadvantageous terms. If, infiead -of gain, we put any other kind of be- nefit or advantage-if, infiead of lofs, we put any other kind of rnikhief -or inconvenie~ce, of qud vdue, the .refult will be the fame.

A man is in one of there fituations, fuuppofe, in which i t would be for his advantage to borrow. But his circum- fiances arc fuch, that it would nbt be worth any body's while ro lend him, at *he higheR rate which it i s propofcd the law hould allow,; in fiort, he cm- not get it at that rate. If he thought hc covld get it at that rate, rnoR Curely he would not give a higher : he may be trufied ~ Z K thrtf : for by the Cuppotition he has nothing &f&k in his under- b d i n g . But the f& is, he cannot get it at that Imer rare. At a highet.

D 2 rate,'

36 LPTT. IV. R r a b for .R@raint. rate, however, he could get it : and as that rate, though higher, it would be worth his while to get it : fo he judges, who has nothing to hinder him from judging right; who has every motive and every means for forming a right judgment; who has every motive and every means for informing himfelf of the circumflances, upon which reAi- tude of judgment, in the cafe in guef- rion, depends. T h e legiflator, who knows nothing, nor can know any thing, of any one of all thefe circum- fiances, who knows nothing a t a l l about the matter, comes and Cays to

him-" It fignifies nothing; you hall '' not have the money : for it would be " a mifchief to you to borrow it upon " fuch terms."-And this out of pru- dence and loving-kindnefs ! - There may be worfe cruelty : but can there be greater folly 3

T h e

PrdteEfion .of Jnkigcnce, 3 7 The folly of thofe who perlifi, as

i s fuppoied, without reafon, in not taking advice, has been much expati- ated upon. But the folly of thofe who perfiit, without reafon, in forcing their advice upon others, has been but little dwelc.upon, though it is, perhaps, the more frequent, and the more flagrant of the two. It is nat often that one man is a better judge for another, than that other is for himfelf, even in cafes where the advifer will take the trouble .make himfelf maller of as many of the materials for judging, as are within the reach of the perfon to be advifed. But the Icgiflator is not, can not be, in the poffefion of any one of thefe materials. --What private, can be equal to fuch, public folly ?

I fhould now fpeak of the enterpriz- iag clafs of borrowers : thofe, who, when charaAerized by a fingle term,

' . D 3 are

38 LETT. IV. Reafm. f~ Rc/raint. are difiinguihed by the unfavourable appellation of proje8oi-s: but in what 1 h a l l have to fay of them, Dr. Smith, I begin to forefee, will bear fo material a part, that when I come to eater upon that fubjelt, I think to take my leave of you, and addrelj my klf xo him.

Fro f eAEo# of Simplicity. 39

L E T T E R V.

Reafms for Rgraint. - Prottfi'o~ of Simrph'ci~.

Come, IaRly, to the cafe of the fim- I ple. Here, in the f i r l t place, I think 1 am by this time entitled .to obiervc, that no fimplicity, fhort of abfolute i.diotilisl, can caufe the individual to make a more groundlefi judgment, than the legiflator, who, in the cir- cumitanccs above itated, ihould pre- tend to confine him to any given rate of intereft, would h& made for him. -

Another confideration, equally con- clolive, is, that were the kgiflato?~ judgment ever fo much fuperior to the individual's, how weak fbcver that

40 LETT. V. Rtajns for Rgraint. may be, the exertion of it on this occa-' lion can never be any otherwife than urelefs, fo long as there are fo many fi- milar occafions, as there ever mufi be, where the fimplicity of the individual is equally likely to make him a {offerer, and on which the legiflator cannot in- tcrpofe with effetl, nor has ever io

. much as thought of interpoGng. . Buying goods with money, or upon credit, is the bufinefs of every day: borrowing money is the bulinefi, on- ly, of fome particular exigency, which, in cornparifon, can occur but feldom. Regulating the prices of goods in ge- neral would be an endleis tak, and no legiflator has ever been weak cnough to think of attempting it. And SuppoGng he were to replate the prices, what would that fignify for the l

prote&ion of f mplicity, unlefs he were to regulate alfo the quantum of what

cac h

Proteththm of Simplicity. 4.t' each man fhould buy ? Such quantum , i s indeed regulated, or rather means are taken to prevent buyiilg altoge- ther ; but in what cafes2 In thde only where the weaknefs is adjudged to have arrived at Sdch a pitch, as to render a man utterly unqualified for the ma- nagement of .his affairs : .in &on, when it has arrived at the length of idiocy.

But in what degree foever a man's weaknefs may expoie him so impofi- tion, he itands muck .more expofcd to it, in the way of buying goods, than in the way of borrowing money. T o be informed, beforehand, of the ordinary prices of all the foeis of things, a man may have occaiion m buy, may bc.4

t a k of confidcrahle variety and extent. T o be informed.of the ordinary rate of interefi, is to be informed of one finglc fa&, too interefiing not to have mt-

rmaed' attentbn, and too Ltlrplc .W bave

have elf aped tbe memory. A fcw per - cent. enhanwmcnt upon the price of

goods, is a matter that my cafily enough pafs unheeded ; but a GngJe per cent. beyond the ordi~ary interefi af rnomy, ia a ftride more confpicuous and Itart- ling., than many per cent. upon the price of any kind of goods.

Even in regard to fubjetts, which, by their importance, would, if any, jufiify a regulation of their price, fuch as fOr inflancc land, I queition whe- ther there ever was an infiance where, I without fomc fuch ground as, on the one fide fraud, or fupprefIion of f aas nec&ry to fbrm a judgment of the value, or at kafi ignorance of fuch fa&, on the ether, a bargain wes re- fcindcd, merely becaufe a man had fold too cheap, or bought too dear. Were I to rake a fancy to give a hundred jean putchak iaitaad of thirty, for o

piece

B u d t R f o r r of &np'Ilici~; 43:

pies of Jand, rather.than:noc have it, I don't think . tha~c is any cowt .in Eng- land, or indeed any where elfe, that weuldinterpofc to hinder me, much lefs topunjfh the f d k r with chelofs of t h r a times the purchafe money, as in the cafe of ufury. Yet when I had got my piece of land, and paid my money, re- pentance, were the law ever fo well diipofed t o aEi t me, might be unavail- ing: for the feller might have fpent the money, or gone off with it. Bu,c, in the cafe of borrowing money, it is the borrower always, who, accord- ing to the indefinite, or fhort term for which money is lent, is on the fafe fide : any imprudence he may have com- mitted with regard to the rate of interefi, may be corretied ac any time : if I find I have given too high an interefi to one man, I have no more to do than to borrow of another

. , at'

44 LETT. V. Reafins fir 'R@raint.' at a lower rate, and pay off the firff : if I cannot find any body to lend me at a lower, there cannot be a more certain proof that the firit was not i n reality too high. But of this here- after.

LET-

L E T T E R VI.

MiJbiicJj of the anti-ufiriou~ Lawr; '

N the preceding letters, I have cxa- I mined all the modes I can think of, in which the rcfiraints, impoiid by the laws againft ufury, can have been fan- cied to be of fervice. .

I hope it appears by this time, that there are no ways in which thofe laws can do any good. But there are fe- veral, in which they can not but do, mi fc hief.

The firfi, I h a l l mention, is that of precluding fo many people, altogether, from the getting the money they itand in need of, to anfwcr their refpektivc

j. exigencies.

46 L ~ T . Vt. Mibibirpof tBs

exigencies. Think what a diitrefs i t would produce, were the liberty of borrowing denied to every body : dc- nied to thofe who hare fach Ce~urity to ofier, as renders the rate of intereit, they have to ofTer. a fuficienr induce- ment, for a man who has money, to truit them with it. Juf i that fame fort af dilPreis is produced, by deny- ing that liberty to fa many people, whofe fecurity, though, if tfrey were permitted to add fomething TO that rate, it would be fufficient, is rendered inrufKcient by their being dqnid that liberty. Why the misfottune, of no t being p&ffad of that arbitrarily em &ed degree of fecurity, fhould be made a ground for Cubjetking a man m a hardhip, which is mt impded on rhofe who are free from &at misfor-. tune, is more thw I can fix. T o difcri- cainate the former clds~frorn the latter,

8 I can

mri- itrwiow Lam. 47 I can ice but this one circumfiancc, viz. that their ncceffitp is greater., T h i s it is by t lr wry. fuppofirian : for were it not, they could nat be, what they are fuppofed to be, willing to give mare to be relieved fmm it: In ihis point of view then, the ble tendency of tha law is, to heap rlifirefs -upon diffrefs.

A fecand m i f i k f iis, that of rcn- defing the rams fo much the wode, to a multitude af,thofe, whofe circum- fiances exempt them from being p r e ~ cluded altogether from getting the money they have eccaGoa forc h this cafe, the mifchid, though ncceffa- r i ly lefs intcnfe than in the other, is much more palpable and confpicuous. Th& who. cannot borrow may get what they want, fon long as .they hava a n y thing to Cell. Buc white, out of hving-kindnel~. or whatfocver other

- . motive,

48 LETT. VI. Mijbiefnoft6e motive, the law precludes a man f r o m borrowing, upon terms which he deems too difadvantageous, it does not pre- clude him from j I I i n g , upon any

1 terms, horfoever dirpdvmtagmur. Every body knows that forced falcs are attended with a lofs : and, to this lofs, what would be deemed a mofi extravagant intereft bears in general n o proportion. Wheq a man's moveables are raken in execution, they are, I be- lieve, pretty well fold, if, after all ex- pences paid, the producean~ounts to two thirds of what it would col% to replace them. In this way the providence and loving-kindneis of the law cofis him 33 per cent. and no more, fuppofing, w h a ~ is feldom the cafe, that no more of the l

effeCts ate taken than what is barely neceffary to make up the money due. If, in her negligence and weaknefs, he were to iuffer him to offer I I per

cent. . l

a d - U fwious Laws. 49

cent. per annum for forbearance, it

would be three years before he paid what he is charged with, in the firR in- fiance, by her wiidom.

Such beingthe kindneis done by the law to the owner of moveables, let us fee how it fares with him who has an intereR in immoveables. Before the late war, 30 years purchak for. land might be reckoned, 1 think it is pret- ty well agreed, a medium price. Dur- ing the diitrcfs produced by the war, lands, which it was neceffary fhould be iold, were fold at 20, 18, nay, I b e lieve, in ibme infiances, even fo low as 15 years purchafe. If I do not, mif- recoll&, I remember infiances of

lands put up to public au&ion, for which nobody bid fo high as fifteen. In many infiances, villas, which had been bought before. the war, or at the beginning of it, and, in the interval,

.E had

had been improved rather than impair- ed, foM for Iefs than half, or evcnrhe quatter;of what4 they had been bbught for. I dare not here f6r my part pre- tend tb -be exa& : but on this pagage,

' were .it-worth their notice, Mr. 'Skin- ner, ar Mr. ,Chriitic, could furnifh very infiro&ive notes. Twenty years ~urchak . , infiead of thirty, 1 may be allowed CO ftdkc, .at lea& for illuitra- rim. :An efiatechen of.wo l. a year; clear df twes, wasdevikd to a man, charged, 'fu ppofe, with .I goo l. with interelt. till the money fhould be paid. J i v e per cent. inmrfi, the utrnott which aould .he accepted 'from the

.owner, did not anfwer the incumbran- re r ' s po~pofe : he chofi .to have the money. But 6 per cent. perhaps, would ham .anfwcred his puspofi, if

' not, moft ccttninly it would have an- Swwd rhe p l r p d e d .fbrncbody clfe .:

.fm

anti-ufi~ioru Laws. 5 1

'for multitudes there all along were, whofe purpofes were anfwered by five per tent. T h e war lafied, 1 think, fevcn years : the depreciation of the ,value of land did not take place im- .mediately : but as, on the other hand, neither did it immtdiatrly recover its .former price upon the peace, if indeed i t has even yet recovered it, we may g u t feven years for the tlme, during which it would be more advantageous .to pay this extraordinary rate of inte- ~ e l t than fell the lahd, and during which, accordingly, this extraordinary -rate of intercil woilld have had ' to .run. One per cent. fbr feven years, is not quite of equal worth to feven per cent. the firfi year: fay; howeve'r, ahat it is. T h e e ~ i t e , which bdfore lthe war was worth thirty years pui-- chafe, that is ~ 0 0 ' 1 . and which the dcv.ifor had given to the devifee 3br

E 2 that

52 LETT. VI. Mjbifs of tbc that value, being put up to iale, fetch- ed but 20 years purchaie, 2000 1. A t the end of that period it would

,have fetched its original value, 3000 1. I

Compare, then, the fituation of t h e devifee at the 7 years end, under t h e law, with what it would have been, without the law. I n the former cafe, the land felling for 20 years purchafe, i. e. 20001. what he would have, af- ter paying the 1500 1. is 500 l. ; which, with the intereit of that fum, at 5 per cent. for feven years, viz. I 75 1. makes, a t the end of that feven years, 675 1. In the other cafe, paying 6 per cent. on the 1500 1. that is 901. a year, and receiving all that time the rent of the land, viz. loo l. he would have had, at the feven years end, the amount of the remaining ten pound during that period, chat is 70 1. in addition to his 1000 1 . ~ 6 7 5 1. fubfirakcd from 1o2oL

leaves

anti-u/urioru Laws. 53 leaves 395 1. This 395 1. then, is what he lofes out of 10701. almofi' 3 7 per cent. of his capital, by the lov- ing-kindnefs of the law. Make the cafculations, and you will find, that, b y preventing him from borrowing the 'money at 6 per cent. intereft, it makes him nearly as much a fufferer as if he had borrowed it at ten.

What I have faid hitherto, is con- fined to the cafe of thofe who have prefenr value to give, for the money they ftand in need of. If they have no fuch value, then, if they fuccecd in purchafing aRiRance upon. any terms, it muft be in breach of the law ; their .knders expoling- themfilves to its ven- geance : for I fpeak not here of the 'ac-

- cidental cafe, of its being fo conRruR- ad as to be liable to evafon. But, even i n this cafe, the rnifchierous in- Gloence of the law hill purfucs them ;

E 3 aggravating

" 54 LETT. VI. MPbief~ of the

aggravating the very mifchief it pre. tends to remedy. Though it b c_acious in the way in which the. legi

I

lator wiihes to fee it efficacious, i t efficacious in the way oppofire to tf in which he would wik to fee i t T h e eEe& of it is, to raife th intereit, higher than it would be ot wife, and that :in two ways. I n firit place, a man muit, in CO

prudeace, as Dr. Smith obfcrves, a point of being indemnified, n for whatfoever extraordinary that he runs, independently. of t but far the very rik occafioned law : he mull be i~Jurcd, as it againit the law. This caufe W

operate, were there even as many p fons ready to lend upon the i l l e ~ xate, as upon the legal. But this is n.

the cafe : a great number of perfot we, of courle, driven out of this corn.

3

Wfti~uf~iaus Lcaiu~ 55

petisi~n,.. by the danger of the bofinefs; and anather great.nurnber, by the dii- repute which, under cover of thefe pro- hib i t~ry laws or otherwife, has f a h - ed itfdf upon the name of ufurer. So many perlbns, therefore, being driven o u t of the trade, it happens in this branch, as it mufi neceffarily 'in every other, that thoii who remain have the lers to with- hold them from advancing their terms; and without confederating, cfor it muR be allowed that confedera- cy in iuch a cak is plainly impofible) each one will find it eafier to pufh his advantage up to any given degree of exorbitancy, than he would, if there were a greater number of perfons of the fame fiamp to refort td.

A s to the cafe, where the law is fo worded as to be liable to be evaded, i n this cafe it is partly inefflcacious and nugatory, and partly mifcchievous. It

E 4 is

56 LETT. VI. Mi/cbbi$s of tbc

is nugatory, as to all fuch, whore con- fidence of its being fo is perfett : it is miichkvous, as before, in regard to all fuch who fail of poirefing that perfeR confidence. If the borrower can find nobody a t all. who has confidence enough to take advantage of the *flaw, he fiands precluded from all afliitance, as More: and, though he ihould, yet the lender's rerms mutt neceKarily run the higher, in proportion to what his confideme waats a£ being perfe€t. Lr is nar likely that it lhoiild be perfeEt : it is ftill lefs l i k ~ l y that he fhould ac-

knwledge it fo to be: it is not likely, at leait as matters It and in England, that -the wocft-penned law made ifor this purpofe iho.uld be altogether deiti- tute of.effeR : and while it hasany, that cffe&t, .we fee muit bc in ane way or other mifchievous. 1 have already hinted at.rhe difrepute,

the

anti-u/#riow Laws. 57

the ignominy, the reproach, which pre- judice, the caufe and the effeA of thefe refiriaive laws, has heaped upon that perfeQly innocent and even meritorious clafs of men, who, not more for their a w n advantag: than to the relief of t h e diRreffes of their neighbour, may have ventured to break through thefe reltraints. It is certainly not a matter of indifference, that a clafs of perfons, who, in every point of view i n which their condua can be placed, whether sin relation to their own interefi, or in ,relation to that of the perfons whom t ley have to deal with, as well on the icore ofprudence, as on that cif benefi- cence, (and ofwhat ufe is even benevo- lence, but in as far as it i s prodd ive af beneficence ?) deferve praife rather than cenfure, fhould be claffed with the abandoned and profligate, and loaded with a degree of infamy, which

is

58 LETT. VI. Mi/chiefs sbf tbe

is due to thofe only whofe condu& is. in its tendency the m08 oppoiite to-. their own.

" This fuffering," it may be faid,. U having already been taken accounc of, is not to be brought to account a fiicond time : they are aware, as you yourfelf obferve, of this inconvenience,. and have taken caie to get fuch amends. for it, as they themfelves look upon as fufficient." True : but is it Cure that the cornpenfation, fuch as i t is, will al- ways, in the event, have proved a fuffi- cient one ? Is there no room here for miicalculation ? May there not be un- expeAed, unlooked-for incidenrs, fuffi- cient to turn into bitternefs the urrnoit fatisfailion which the difference of pecuniary emolument could afford $

For who can fee to the end of that in- cihauitible train of confequencea that. are liable to enfue from the lofs of repu-

tation ?

anti-ufiriatl~ Laws. 59

ration? whs c m ffirhom the abyts ofi infamy ? At my rate,. this ar t i~le oE' rnifchief, if not an. addition in its

, quantity to the others ab~ve-naticed, k a t leaa di(tiw3 from. them in i ts . nature, and W fwh ought not to be overlwked.

Nor is tba event of the execution ofi the law by any means an unexarnpled one : feveral- fuch, at different times, have fallen within my natice. Then comes abiiilute perdition : lais of cha- ra&er, apd forfeiture, not of three times the extra-intereft, which formed she pcofit,of the offcnce, but of three i a e s the principal,, which gave occa-, Con, to, it.

The )sit article I have to mention in r$e accwntof miichief, is, the corrup- tjvc influace, exercikd by tbefe laws, on the morals of thc ptwplz; by the pijns,tbey take, and cannot but take,

to

to give birth to treachery and ingra- titude. T o purchafe a pofibility. of being enforced, the law neither has found, nor, what is very material, muR it ever hope to find, in this cafe, any other expedient, than that of hiring a man to break his engagement, and t o cruih the hand that has been reached out to herp him. In the care of in- formers in general, there has been no troth plighted, nor benefit received, In the cafe of real criminals invited by rewards to inform againit accomp~ices, it is by fuch hcacb of faith that fociety is held together, as in other cafe6 by the ob/muanre of it.. In the cafe of real crimes, in proportion as theit mif- chkvoufneis is apparent, what can not but be 'manifeit even to the' criminal, is, that it is by the adherence to his engagement that he would do an injury co focicty, and, that by the breach of.

fuc h

anti-ufurr'ois Laws. . 61

fuch engagement, infiead of doing mifchief he is doing good : in the cafe o f ufury this is what no man can know, and what one can fcarcely think i t pofiible for any man, who, in the charaAer of the borrower, has been concerned in fuch a tranfaltion, to ima- gine. H e knew that, even in his own judgment, the engagement was a bene- ficial one to himfelf, or he would not have entered into it : and nobody elfe b u t the lender is affeaed by i t

L E T T E .R VII.

Wcacy .of anti- u/ut.ious Laws. l

E F 0 R E 'I quit altogether tie confideration of the cafe i n which

a law, made for the purpofe of limit- ing the rate of intereit, may be ineffica- cious with regard to that end, I can not forbear taking fome further notice -of a yafTage already alluded of Dr. Smith's : becaufe, to my apprehenfion, that paffage irems to throw upon the fubjeCt a degree of obfcurity, which I could nilh to fee cleared up, in a fu- I ture edition of that valuable work. " NO law" fays he *, " can re. , B. ii. c. 10, vol. ii. p. 45. edit, 8vo. 1734..

l

9' U

anxi-trjtriolu Laws. 63 *' duce ;the common rate of inte- " reit below the low& ordinary .mar- "' .kct rate,..at the t h e when that law " w;ls made. Notwithhnding the '" edic2.d 1766, by .which .the French "' king aaempred to reduce j b e r a t e d '"' interek .from ,Sve !to four.per .cent, '" nwney .continued .to .be lent in -" France . . at fiue qer n n t . the law -" beim e.va&d .in different -16 ways." .

As to the general:poDtion,'if.fo i t be, fo much, according to mel the betfer :: .hut I mult.confeh I do not Ge why thb -ihould bcxhe cafe, .It is for the pur- .pofe of proving the truth of this gem-

'

ral pohtion, that the h& of the ineffi- xacy of thisattempt kerns to be ad-. duced : for no other proof is adduced .but this, -But, taking the &fa& for ,granted, I .do not fee how it can be i ~ ~ f l i ~ i & t to fqppoet the inference. Tk

J;u#,

64 LETT. VII. E$caey law, we are told at the fame time, was evaded : but we are not told how ir came to be open to evafion. It might be owing to a prrticulardefd in the penning of that particular law : or, what comes to the iame thing, in the provifions made for carrying it intoex- ecution. In either cafe, it affords no fupport to the general pofition : nor can that pofition be a juft one, unlefs i t were CO in the cafe where every pro- viiion had been made, that could be made, for giving efficacy 'to the law. For the poficion to be true, the cde mutt be, that the law would ftill be broken, even after every means of what can properly be called evajool, had been removed. True or untrue, the pofition is certainly not felf-evident enough to be received without proof: yet nothing is adduced in proof of it. but the fa& above-noticed, which we

ice

anti-u/irrions ~ W J , 65

fee amounts to no fuch thing. . W h t is Irnorc, I. fhould not expea. to 'find it .capable of .'proof. . I do' not .fee, what it is, .that. ihould render. the law incapable of " reduciag the com- " mon rateof inmeif below the lowefi CS ordinary market .rate," but fuch . a itate of things, fuch a combination. of circomfiances, as ihould..afford obfia* cles equally, powerfu1;or nearly fo, to she efficacy of* the law againff .all higher rates. Fordefiroying the law's efficacy altogether, I know of nothing that could ferve, but a refolution on the part o f . all perfons any way privy not ro inform : but by. fuch a refolution any higher rate is jufi as- effeflually .prote&ed as any lower one. Suppofc .it, itrittly freaking, univerfal, and the law mufi in all infiances be equally inefficacious ; all rates ,of interefi arc

.. ' 'equally free ; and the fiate of men's F dealings

56 Lrm. VIl. J@hq.$ - &dingr in this wry juR whut it rouM be, were rhcs no law at all 'upon tk fu'ubj& But in this cafe, the pofition, jn ar far es it limits the inefficacy of the law to the& rates which are below

" l~wefi ~ r d b a l y market rate,') is m a r true. For my part, 1 cannot con- mire how my fuch uoivetfal reblu- tion could have been maintained, or codd ever k dntrincd, withwt a n open concert, and as open a rebt.ltiom winit government ; nothing of. which &t appears to hare t a k c ~ p l a a :. and,

to ens pacicular coofedcracies, they a n W copsbb ef p r t d m g usy bigher I ) U ~ ag~ in& -tk probhicioe, as any h e r aws.

Thw mwh i&d mu(t be d,, that tbe kw rat# in q\uR.iQb, v i a slug which WI the hwR o r d i ~ ~ r y rp,lrkcc rate irpmedirtelg br$ote &be aDzLulq of the law, is l i e ta coept

in

RCli-11~0w l,utw. 6t in for the proteQion of the public againft the law, more frequently than m y other rate. That mufi be the c& on two accounts : fir& bccaufe by k i n g of the number of the ordinary rates, it was, by the f i p p f i tion, more friquenr than any extraordinary ones : iecondly, becauie the difrepute annex- ed to the idea of ufury, a force which might have more or kfs efficacy in ex- cluding, from t k proteaion above fpken of, fuch extraordinary rates,

. cannot well be fuppofed to apply itielf, or at leait not in equal degree, to tbb low and ordinary rate. A lender h a certainly lcfs to flop him from taking - a rate, which may be taken without difreputc, than from taking one, which a man could not take without iubjeb ing himklf to that Mconveniunce : our is ic likely, that men's imrgiclatioas and Eentiinesto &wM refiify Lb W e n an

F o obfequi-

68 LETT. VII. E$Scacy of

obfquioufnefs to the law, as to R a ~ p difrepute to-day, upon a rate of inte- hit, to which no fuch accompaniment had ftood 'annexed the day before.

Were I to be ak rd how I Imagin- ed'rhe cafe itood in the particular in- 3tance referred to by Dr. Srnith ; judg- 'ing from his account of it, aflified by general probabilities, I fhould ahfwer thus :--The law, I fhould fuppofe, was not ib penned as to be altogether proof againit evafion. I n many initances, of which it is impofible any account fiould have been taken, it was indetd conformed to : in fome of thofe in- fiances, people who would have lent otherwife, abfiained from lending alto- p h e r ; in others of thofe initances, people lent their money at the reduced legal rate. I n other infiances again, the law was broken : the lenders truft- ing partly to expedients recurred to

for

for evading it, partly to the good faith and honour of thofe whom they had. to deal with : in this clafs of infiances it was natural, for the two reafons above fuggeited, that thofe where the- old legal rate was adhered to, fbould have been the mo[t numerous. From the circumitance, not only of their number, but of , thcir more dire& re- pugnancy to the particular recent law in qucfiion, they would naturally be the moR taken notice,of. And this, I take it, was the foundation in point of fa& for the DoRor's general pofi- tion above-mentioned, that " no law l' , can reduce the common rate of inte- " 'reit below the lowefi ordinary mar- " ket rate, at the time when that law 6' was made."

In England, as far as I can truit my judgment and imperfee general recol- JcRion of the purport of the laws re-

F 3 lative

70 L V IQj'kag Of

jativc to this matter, I Bould not fup poL that the above pofition would prove true. That there is no fuch thing as any palpabk and univerfally- notorious, as well as unirerfallpprac- ticablc receipt for that putpole, is manifeft from the examples which, as . 1 have already mentioned, every now and then occur, of convidions upon thefe fiatutes. Two fuch receipts, indeed, I hal l have occarmn to touch upon prckntlp : but they are either not obvious enough in their nature, or too troublefome or not extenfive enough in their application, to have defpoiled the law altogether of its terrors or of its preventive efficacy.

I n the country in which I am writ- ing, the whole fyficrn of laws on this fubje& is perfetlly, and very happily, inefficacious. The rate fixed by law is 5 per cent. : many people lend m+

ncy ;

C'; and nobody at that rate: the bwee ordinary raw, upon the very kft real fccurity, is 8 per cent: .g, and even 10, upon fuch ftcurity, arc common. Six or feven may have place, now and then, between relations or other particular friends : becaufe; now and then, a man may choofe to make a prcfent of one or two per cent. to a perfon whom he means to favour, The contratt is renewed from year to year : for a t houfand roubles, the bor- rower, in his written contratt, obliges himfe'elf to pay at the end of the year one thoufand and fifty. Before wit- ncffes, he receives his thoufand rou- bles : and, without witneres, he imme- diately pays back his go roubles, or - his qo roubles, or whatever the fum may be, that is neceflary to bring the real rate of intereft to the rate verbally agreed on.

F 4 This

72 LETT. VII. .Efi119, &C.

: This contrivance, I take it, would not do.in England : but why it would not, is a queit i~n which it would be in ;aih for me M pretend; at this difiaoce from all authorities, . . to difcuk

. L E T T E R VIII: 1

Virtual Ufity auowcd.

AV I N G proved, as I hope, by this time, the utter impropriety

of.the law's limiting the rate of intereft, .in every cafe that can be conceived, it ,may be rather matter of curiofity, than any thing elfe, to enquire, how f a r the law, on this head, is conftfienc with itfelf, and with any principles up- pn which it can have built.

I . Drawing and re-drawing is a praflice, which it will be iufficienc here to hint at. ' It is perfeQly well known.to all merchants, and may be CO to all who are not merchants, by

confulting

v4 . LXTT. -WI. YirlldC I

confulting Dr. Smith. In this way, he has hewn how money may be, and has been, taken up, a t fo high a rate, as 13 or 14 per cent. a rate nearly three times as high as the utmoft which the law profeffi to allow. T h c extra interell is in this cafe maiked un- der the names of comrn;Jim, and price of &gee The cornmifiion is bat h a l l upon each loan, not m m , I

.. think, than per cent. : cuftom havb ing ltrachca So frr but no farther, i t might bc theught dangerous, perhaps, m venturt upon a n y higher allowance under chat name. The charge, being repeated a numbhr of times in t k

courre of the year, makes up in f r b qucncy what it wants m weight. The tranfa€tion is by his fhift rendered more troublcfonic, indeed, but not l& pra€ticablcr, to filch partier as arc agreed about it. But if ufu~y 3s good

for

75 for mercbohto, I don't rcry 4 1 wblt lhwld d t it bd for eruy body elk.

2. At this d i n c e fiam d thc fouwins of kgal knowledge, I will not pretend to far, whether the pmc- tice of- o r c q d &l& at an uoder value, would hold goad againfl all rt. tacks. It Rrikcs my mdleAion as a pretty common one, and I think it could not be brought under an7 of the penal Dncuus rgsinfi ufiuy. The de- qweoelr of the conlideration might, far aught I know, be attacked with fucceSs, in a court of equiq ; or, per; haps, if there were fufkiint evidence (which the agreement of the parries might eafily pment) by an &ion as common law, for money had and re- ceived. If the pratkicc be really proof againit all attacks, it f m s to sfford an efFe&ual, and pretty com-

4 modious

76 LETT. V1I.I. Virtual modious method of evading the re- itriEtivc laws. The only 'nitrairit is, that it requires the amfiance of a third pcrfon, a friend of the borrower's ; as for infiance: B, the real borrower, wants rool.'and finds U, a ufurer, who is willing to lend it to him, at 10

per'cent. 'B. has F, a friend, who has not the money himfelf to lend. him, but is willing m itand fecurity for him, to that amount. B. therefore draws upon F, and F. accepts, a bill of 1001. at 5 per cent. interetl, pay- able at the end of a twelvemonth from the date. F. draws a like bill upon B.: each fells his bill to U. for f i f ty pound ; and it is endorfed to U. accordingly. The 50 1. that F. re- ceives, he delivers over without any confideration to B. This tranfaaion, if it be a valid one, and if a man can find fuch a friend, is evidently much

lefs

. UJii aUowed. 9 i! lefs, troublefome than thc praCtice of drawiw and re-drawing. . And this, if i t ' be praaicable at all, may bc prattifed by perfons of any defcrip tion, concerned or not in trade. should the effeQ of this page be to fug- geft an expedient, and that a fafe and commodious one, for evading the laws againtt uiury, to fome, to whom fuch an expedient might not otherwife have occurred, it will not lie very heavy upon my wnfcience. The prayers of ufurers, whatever efficacy they may have in . lightening the bunhen, I hope I may lay iome. claim to. And I think you will not now wonder at my ikyin& that in the efficacy of fuch prayers 1 have not a whit lefs confi- dence, than in that of the prayers of any other clafs of. men.

Oiie apology I hall have to plead at .any rate, that in pointing out thefe

flaws,

78 LBTT. VIII. 'Plkrual $am, to the individual who m y bd difpokd to cmp out at them, I p i n t hem .out at the fame time to tbe legiG ht&, in whore power it is to itop them up, if in his opinion they require it. If, 'notwithftanding fuch opinion, be ihould omit to do fo, the blame rill lie, mt on my induftry, but on hia ncgli gc nce.

Thtie, it rnay be Caid, fhould they trtn be fccute 4 effc&usl evalions, in Ltill but toalions, and, if charge- rbk upon the hw at all, are charge- able rmt as inconGRcncier but r s W-

bgbw. Be ir k. Setting M e afde, *n, M apdimts praAiied or pr&i- &k, dy behind its back, I orin hg I* m remind yob cd n o asherr, rftiicd from time to time, under- itd proc&on and &re io facr.

The6rkIfMlumhn is pas*

Braking.

Yuty - 7+

&r&~~g. In this d e r h c ~ is thc klt ptetenoe for mote than ordinary inui re% inafmueh as the Gcurity is, in this cafe, not d y equal to, but better than, w h it can be in any other: C6

wit, tbc preknt @RioR of a move- able thin^, af edy fale, on which the, crcdroor hYs thc power, and certainly &m oot want the iaclinatiorr, m iix Xu& prkc as is 4 for bis advantage. If thcre be r cafe in which the alkwing of fuch ertmrdimry inter& ie tcmded with mrc danger than a m &I-, It mufi be this: which is h p m ticdarly adapted to tk lituahn d tk'bwfi poors tbae is, of thoh w b . on the fcore of indigence or Gmplieich or bab, are m& Qpen to impofition. This trade however the by l&& avowedly p r e s , What the sw of intcreP ia, which k al lam m be tlkenia9hl. W*, Icsa mattakeup

on

t e L E ~ T . VNI.. Yirtual on mt to remember :. but I am-much deceived, if it amounts to kh than 12

per cent., in the year, and I heliev'e ir amounts to a good deal more. . Whe- ther ir were 12 per cent. or 1200, I be- lieve would make in pra&ice but littk difference. W h a t cpmmaJiofi is i n the buGneis of dvwing and .re-drawing, warehonr/c:room is, in that-of pawnbrok- ing. Whatever limits then are.fct.to .the profits of. this trade, are fet, I take it, not by the vigilancy of the law, but,

' as in the cafe of other trades, by the competition amohgfi the traders. ' Of zhe other regulationk contained in the a&s relative10 this- iubje&t I recollett .no reafon to doubt 'the ufe. . The other infiance is that of Jot- .,tonary and tejpondentia: for the two wanfalkions, being io nearly related, &aybe fpiken of together. Bortoiriry is the ufury of piwnbroking : . refpon-

dentia

WJkry sawed. 8 X

dent;; is ufury at large, but combined in a manner with insurance, and em- ployed in the afifiance of a trade car- ried on by Tea. If any fpecies of ufury is to be condemned, I fee not on what grounds this particular fpecies can be Ccreened from the condemnation. " Oh " but '!(Says firwillian Blackitone, or any body elfe who takes upon himfelf the taik of finding a resfon for the law) GC this is a maritime country, and the GC trade, which it carries on by tea, is the CC meat bulwark of its defence." I t is b

not neceffary I fhould here enquire, whether that brancb, which, as Dr. Smith has hewn, is,'in every view but the mere one of defence, lek beneficial t o a nation, than two others out o f d c four branches which comprehend a11 trade, has any claim to be preferred t o them in this or any other way. I admit, that the liberty which this

. G - tranch

d2 L T . I f i r t ~ ~ ~ ~ l l

branth of trade enjoys, is no more than I

what it is perfr€tly right it ihould enjoy. I What I wani to know is, what there is in the clifs of men, embarked in this trade, that Ihot~ld render beneficial to them, a liberty, which would be ruinous to every body tlfe. Is it that Sea adventures have lefs hazard on l thcm than land adventures? or that the iea teaches thofe, who have to deal with it, a degree of forecaq and reflec- tion which has been denied to'land- men ?

I t were eafy enough to give farther and farther extencon to this charge of inconiiitehcy, by bringing under it the ' liberty given to infurance in all ia branches, to the purchafe and fale of 'annuities, and of'pa/t-obits, in a word t o all ca'fis whert a man is permitted to take upon himfelf an unlimited dc- krcc of iik, ,rtceiving for ib.deing tth

9 unlimited :

U f q &aed. 85

unlimited cornpenfation. Indeed I know not where the want of infiances would fiop me : for in what part of the magazine of events, about which hu- man tranlgttions arc converiant, is cer- tainty to be found 7 But to this head of argument, this argument ad bomi- -

~ m , as it may be called, the ufe of which is but fubfidiary, and which hag more o'f confutation in it than of per- fuafion or initruaion, I willingly put an cnd.

L E T T E R IX.

BlackJone conzdercd.

1 Hope you are, by this time; at leait, pretty much of my opinion, that

there is juit the fame fort of harm, and no other, in making the belt terms one can for one's felf in a money loan, as there is in any other fort of b a r p i n Jf you are not, BlackRone however is, whore opinion I hope you will allow .to .be worth fomething. In fpeak- ing ,of the rate of interefi *, he ilarts a .parallel between a bargain for ahe .loan of money, and a bargais

* 3. L ch. 30. . . .* t abour

LBTT. IX. Blackjfom conjdercd. 85 about a hork, and pronounces, withour hefitation, that the harm of making coo good a bargain, is jufi as great in the one cafe, .as in the other. As money- lending, and not hoyfe-dealing, was,, whaty.ou lawyers call, thepriffcipalca/c, he drops the l~orfe buf nefi, as foon as

, i.t has anfwered the purpofe of illuitra- tion, which it was brought to ferve, But as, in my conception, as well the ~eafoning by which he fupports the deciGon,. as that by which any body clfe could have fitpported it, is j u i t as applicable to the one fort of bargain as to thu other, I will carry on the parallel a little farther, and give the fame extent to the reafoning, as to the pofition which it is made ufe of to fupport. This extenfion will not be without its ufe; for if the pofition, when thus extended, ihould be found jufi, a pranical inference will arife;

G 3 which

which is,'that the benefits of thefe rc- fiaints ought to be extended from the money-rradc to the horfe-trade. That my own opinion is not favour- able to fuch refiraints in either cafe, has bcen fufficiently declared ; but if more refpehb1e opinions than mine are itill to prevail, .they will not be the kfs refpeltable for being confiRew.

The #fort of bargain which the learned commentator has happened to pitch upon for the ill~uflration, is in- 1 deed, in the cafe iflufirating, as in the cafe illultratcd., a loan : but as, to my apprehenfion, loan or fale makes, in pointof reafoning, no fort of diffemcc, and as the utilityof t h e c o n c l u h will, In the .latter cafe, be more txtenfivc, I &all .adapt the reafoning to the more important bufinefs of frlli.ng horfes, in- fiead of the..ltfs.imgorcant one of lend- ing them. .

-,A c k -

- LETT. IX. BiadJon~ confulere4. ll$ .A circurnltance, that would rendq

the extenfion of thefe refiraints to tfic horfe-trade Inore fmooth and eafy, iq, that in the oae track, as wrll as in .the other, the public has dready got the length of calling n:qmu. Jockey-&, a tern1 of reproach not -1efs frequently applied to the arts af thofe who fell hprces than to the arts of thofe who ride them, founds, I fake it, to the ear of many a ~ o r t h y gentleman, nearly as bad as uJury: and it is well known to all thofe who put their trufi in pro- rcrbs, and .no$ t? 1406 Gho put their trufi in party,. that when we have got a dog to hang, who is tronblerome and keeps us at bay, wboever.can con- trive to fallen a bad p a m to his tail,

hgs gained n~oi-e than half the battle. I now prorced with my application. The words i n italics are my own: all the refi are Sir WiMiam Blackitone's :

G 4 md

'88 LETT. IX. Blackj2une cogdered, a d 1 reltore, at bottom, the words I was obliged to difcard, in order to make room for mine.

l " T o demand an exorbitant price is 66 equally contrary to confcience, for 1

. " the loan of a horfe, or for the loan 05 l

6s a Turn of money: but a reafonabk l

L& equivalemt for the temporary incon- '* venience, which the owner may feel " by the want of it, and far the hazard " of his lofing it entirely, is not more " immoral in one cafe than in the

other. * * * * " As to filling ~ Q Y - S , a capital dif-

" xinaion muft be made, between s " moderate and an exorbitant profit : " to the, former of which we give the

. " name of borfi-dealing *, to the latter

. " !he truly odious appellation of joc- ' key-~$$ -j- : the former is neceffary in

LBTT. IX. Blac&Jottt c~nJdrred. &P every civil Rate, if i t were but to ex-

" dude the latter. For, as the whole qf " this matter is well fummed up by Gro- '' tius, if the compcnfation allowed by LC law does not exceed the proportioh " of the imenveaimce wbicb it is to tbe " /sUer of tbe bo@ to part witb it *, or " the want wbicb tbe buyer bar of it f., L 6 iri allowance is neither repugnant to 'g the revealed law, nor to the naturai " law : but if it exceeds thefe bounds, " it is then an oppreffive jockey-Jipf : " and though the municipal laws L( may give it impunity, they never

" can make it jufi. " We fee, that the exorbitance or moderation of tbo price given fora

" Barb 5 depends upon two circum- " fiances : upon the inconvenience of

hazard run. t felt by the loan. 1 ufuv. S intcrcR for tbc money Icnt.

46 , parting

go LEFT.^^. B~dJ01ucogbhd " parting withtbebor- onebns*, and the " hazard of npt being abk rp m& wit& " jitcb anatbrr j-. The inconvenience to "' individuals,/rUer~4bwfi~~, cap never " be cfiimatcd by laws ; the general " picc forborjiu 5 rnufidcpcnd thardhre II upon the ufual or general inconve- C6 niencc. This rdults cntirdy from " the quantity o f bw-J 4 in the king- .'' dom : for the more bwjj 4 there are

U running &out ** in any nation, the " g r e a r fuperfkiiry there will be be- * yond what is neceKary to carry on the

bufinefs d the m4il conbu j-t and the .C common concerns of life. In every

netion or public community there is a certain quwcity o f horks f f then

*' necsffary, which a pcrfon well kill-

it h r theprefent. + lofing it entiwly. 3 lenders. ) rate o,fgcngal i n t e r 4 4 mpqy. .iB lpecie. cir&&iinp tt cxchplge.

I

LEPP. IX. Bkckwe cm-. 9~

" ed in political arithmetic might per- -" haps calculate as mraAly as a piwe '' h - - & a k r a c a n the demand for run-

U ning hfi b biJ m u j ~ & Z e s t : all " above this neceffary quantity may be "' {pared, or lent, ar/okl, without much " inconvenience to the refpeaive knd- " ers or/elZv~.: and thegreater thenati-

.A6 onat fuperfluity is, the more numerous ." will be the /~UCTJ.$, and the low&

'' be : but where there are not enough, " or barely enoughbare bm-s 1 to an- " iwer the ordinary ufes of the public, " b o f e - J e f i q - will be proportionably -" high : f o r j e l h will be but.few, an -" few can fubmit to the inconvenience

offilling -ft."-So far the learned

+ banker. t c a h in his own hop. 3 lenders. Q the race of the national .iwcrc@. A( circulatins calh. iptardt. ,lepiIca. : .tt lending.

.I boge

92 LETT. IX. BZackJone mnJdere6. - , I hope by this time you arc worked'

up to a proper pitch of indignation, a t the negled and inconfiitency betrayed by the law, in not fuppreaing this fpe- cies of jockey-hip, which it would be CO eafy to do, only by fixing the price of horfes. Nobody is lefs diL pokd than I am to be uncharitable : but when one thinks of the 1500 L taken for Eclipfe, and 2000 1. for Rockingham, and fo on, who can avoid being hocked, to, think how little r e gard thoie who took iuch enormous prices mufi have have had for " the 66 law of revelation and the law of na- " ture ?" Whoever it is that is t o move for the municipal law, not long ago talked of, for reducing the rate of intereft, whenever that motion is made, then would be the time for one of the Yorkihire members to get u p

- and move, by way of addition, for a claufc

claufe for fixing and reducing the price of hotfes. I need not expatiate on the ufefulnefs of that valuable fpe- cies of cattle, wiiich- might have been as cheap as a,Kcs before now, if our lawgivers had been'as.mmdfu1 oftheir duty in the fupprefion of jockey++, as they have been in the fuppreffion of

*?WY. It may be faid, egaidl fixing fie

#price of burfe-aelh, that different -

.horfes may be of diffe~ent values. I anfwer--and I. think I h a l l hew you --as much, when I come .to touch upon ethe fubjeR of xhamperty-not more different than the .values which the uTe of the .fame turn of money may .be of to different pe~foas, on di f f~em gccafions.

L E T T E R

I T is one thing, to find rcafons why . it isjit a l a w f i d have been made :

it is another, to find the reafons why ic Was made: in other words, it is one thing to jufiify a law: it is another thing to account for its exiitence. I n the p I t f e ~ infiance, the former talk, if the obfervarions I have been trou- bling you with arc juit, is an impof- fible one. The other, though not neceffary for conviaion, may contri- bute fomething perhaps in the way of fatisfahion. T o trace an error to it8

fountain hwd, fays lord Coke, is to rcfuto

~rejdicd~ againij? UIIFaj). g3

fefute it3 and many men there'are who, €.ill they have received this fatisfa&ion, be the ermr what it may, cannot pre- vail upon thernfelves to part with it. " If our' anceRors .have been all along " under a hiltake, h6w came they to " havc fallen into it ?" i~ a queflion that haturally prefents itreif upon all fuch 'occafions. The cafe is, that in mattefs of law rnbre efpecially, fuch k thC dominion of authority over our rnindi, md fuch theprejudi;e it c m t n in favour of whatever inititution it has take under its wing, that, &r a1i inander of reafons that can be thought of, in favour of the infiitution, havc been h e w n to be infufficient, we itill -cannot forbear looking to fome unaG fignable afid latent rearon for its effi- ecitnt cailk. But if, i n h d of any fuch irafon, we .can find a crtufe h r it in &me a d r i g of the ehaieoufnefs of

which

which we are aiready fatisficd, then ;ct

1aR we are content to give it up witb- ~ out further ftruggle; and then, and not till then, our fatisfaaion is com- I

pleat In the conception8 of the more con4

iiderable part of thofe through whom ~

our religion has been handed down to us, virtue, or rather godlineis, which was an improved fubflitwre for virtue, confiited in {elf-denial : not in felf-dc- I

nial for the fake of fociety, but of felf- denial for its own fake. One pretty general rule fervcd for mofi occafmns : not.to do what you had a mind to do; wr, in other words, not to do what would be for your advantage. By 1 ihis of courG was meant temporal ad- vantage: to which fpiritual advantage was underitood to be in confiane and ,diametrical oppofition. For, the proof af a refolution, on the part of a being

of

of perfea power and benevolence, to make his few favourites happy in a . itate in which they were t o be, was his determined pleafure, that they fhould keep themfelves as much itrangers to happinefs as pollible, in the fiate in which they were. Now to get money is what moft men have a mind to do : becaufe he who has money gets, as far as it goes, moft other things that he has a mind for. Of courfe nobody was to get money : indeed why fhould he, when he was not CO much as ta, keep what he had got already? T o lend money at intenit, is to get mo- ney, or at leaft to try to get i t : of courfe it was a bad thing to lend mo- ney upon fuch terms. The better the terms, the wotfe it was to lend upon them : but it was bad to lend upon any terms, by which any thing could

H be

g8 LETT. X. Grwtrds of tbe

be got. What made it much the worfe was, that it was aRing like a Jew : for though all ChriRians at firR were Jews, and continued to do as Jews did, after they had become Chrittians, yet, in procefs of time, it came to be difcovered, that the diitance between the mother and the daughter church could not be too wide.

By degrees, as old conceits gave place to new, nature fo far prevailed, that the objektions tb getting money in general, were pretty well over-ruled : but itill this Jewilh way of getting it,

was too odious to be endured. Chrif- tians were too inrent upon plaguing Jews, to lifien to the fuuggeition of doing as Jews did, even though mo- ney were to be got by it. lndeed the eafirr method, and a method pretty much in vogue, was, to let the Jews

get

Pr~ud;ErJ againJ Ufuty. 99

get the money any how they could, and then fqueeze it out of them as it was wanted.

I n p r o d s of time, as queflions of all Corts came under difcufion, and this, dot the lea@ interefiing, emong rhe refi, the anti-jewilh lide of it found ao unopporcuae fupport in a pairage of AriRotle : that celebrated Feacheg who, i n all matters wherein heathenifm did nor dnfiroy his competence, ha$ eftabliihed a ddpotic empire over the .Chri&ian world. As fate would have it, that great .philofopher, with all hjs indufiry, and all his peweration, not- withhnding the great oumber ~f pieces of mopey that had p a f f i shsough his hands (-more perhaps than ever paffed thraugh the hands of philofophcr before ar fince), and .notwithfianding che uncommon pains .he had befiowed on the fuhjea of ge.

H 2 neration,

neration, had never been able to difa cover, in any one piece of money, any organs for generating any other ruck piece. Emboldened by fo firong a body of negative proof, he ventured at lait to uihcr into the world the rdult of his obfervations, in the form of an univcr- jil'propcfition, that all nwny i~ kr iri

nature barren. You, my friend, to , whore caft of mind klbund reafon is much more congenial than antient phi- ldophy, you have, I dare to fay, gone before me in remarking, that h e pracr- tical inference from this Ihrewd obfcr- vation, if it afforded any, fhould ham been, that it would be to no purpok for a man to try to get five per cent.

~ out of money-not, that if he could contrive to get fo much, there would be any harm in it. But the fages of thofe days did not view the matter in that light.

l A con-

' :A confideration that did not happen 30 prefent itfrlf to that great philofo- *her, but which had it happened to prefent itfclf, might not have been altogether unworthy ~f his notic?, is, athat thaugh a daric would not begot .another daric, any more than it would a '

.ram, or.an ewe, yet .for a daric which 3 man borrowed, he might get a ram .and a couple of ewes, and :that the *ewes,. wee the -ram left with them a . certain time, .would probably .not be .barren. That then, at the end of the %year, he would find hideif mafter of his three heep, together with two, if

,not three, lambs ; and that, if he fold his theep again to pay* back his daric, and gave one of his lambs for the uk .of it in the mean time, he woukl be two lambs, or at leafi one lamb, richer, than if he had made no iuch bar-

L B T T . ~ . GrondOflJIG

There theological and philofophical conceits, the offspring of the day, were not ill kconded by principles of a .more permanent complexion.

T h e buiineh of a money-lender, 'though only among Chriitians, and in Chriitian times,a profcribed profefion,. has no where, nor at any time, been a popular one. Thoie who have the re- folutioh to facrifice the prefent to fu- ture, are natural objeRs of envy to thofe who have facrificed the fscure to the prefent. .The children who have

.eat their cake are the natural enemies of the children who have theirs. While the money is hoped for, and for a ihort time after it has been re- ceived, he who lends it is a friend and benefaffor : by the time the money is fpent, and the evil hour of reckoning is come, the benefaaor is found to have changed his nature, and to have

Put

put on the tyrant and the oppreffor. I c is an opprefiion for a man to reclaim his own money: it is none to keep it from him. Among the inconfiderate, that is among the great mafs of mankind, feififh affeaions confpire with the To- .

c id in treafuring up all favour for the man of diniyation, and in refufing juf- tice to the man of thrift who has fup- plied him. I n fome ihape or other that favour attends the chofcn objeQ of it,

through every ftage of his career. But, in no ftage of bis career, can the man of thrift come in for any hare of it. I t is the general inrerefi dfthofe with whom a man lives, that his ex- pence fhould be at leait as great as his circumitances will bear : becauie there are- few expences which a man can launch into, but what the benefit of it is fhared, in fome proportion or other, by thofe with whom h e lives.

.H 4 In

I n that circle originates a Randing law, forbidding every man, on pain of infamy, to confine his expences within what is adjudged to be the meafure o f his means, faving always the power of exceeding that limit, as mucl] as h e zhinks proper : and .the means afigned him by that -law may be ever fo much beyond his real mean% but are fure never to fall fhort of them. So cloie .is the combination thus formed be- tween the idea of merit and rhe idea of expenditure, that a difpofition to- fpend finds favour in the eyes even of -thofe who know that a man's circum- fiances do not entitle him .to the means : and an upltart, whde chief recom- mendation is this difpofition, fhall find .hirnfelf to have purchafed a permanent fund of refpe&, to the prejudice of the

, very perions at whofe expence he has $een gratifying his appetites and :his

pride,

Prejrrdiccs againy? Ufuv. ' I 05 pride. The lufire, which the difplay of borrowed wealth has difiufed over his charatlet-, awes men, during the feafm of his profperity, into a fub- mifion to his infolcnce: and when the hand of adverfity has overtaken himat jaR, the recolle&ion of the height, from which he .is fallen, throws the weil of compallion over his injuiticc.

The condition of the man of thrift is the reverk. -His laiting opulence .procures him a hare, a t leaR, of the fame envy, that attends the prodigal's tranfient difplay : but the d e he makes -of it procures him no part of the fa- vour which attends the prodigal. In .the fatisfa&ions .he derives from that .ule, the pleafure c+f pofferin, and the idea of enjoymg, at fome d-ifiant pe- riod, which may never arrive, nobody comes in for any hare. I n the midi t of his opulence he is regarded as a

I;:l?iI

rob LETT. X. Graund~ of r&t kind of infolvent, who refufes to ho- nour the bills, which their rapacity would draw upon him, and who is by fo much the more criminal than other infolvents, as not having the plea of in- ability for an excuie.

Could there be any doubt of the dif- favour, which attends the caufe of the money-lender, in his competition with the borrower, and of the difpofition of the public judgment to facrifice the in- terefiof the former to that of the latter, the fiage would afford a compendious but a pretty conclufive proof of it. It is the buGnefs of the dramatifi to

fiudy, and to conform to, the humours and paffions of thofe, on the pleafing 0.f whom he depends for his fuccefs: i t is the courfe which refleaion muit fuggeit to every man, and which a man would naturally fall into, though he were not to think about it. He

may,

Prejudices agaiq9 U/u y; I 07 may, and very frequently does, make magnificent pretences, of giving the law to them : but WO be to him that attempts t o give them any other law than what they are dirpofed already to receive. If he would attempt to lead them one inch, i t mutt be with great caution, and not without fuffering himfelf to be led by them at Icait a dozen. Now, I quefiion, whether,

- among all the infiances in which a borrower and a lender of money have been brought together upon the itage, from the days of Thefpis to the pre- fent, there ever was one, in which the former was not recommended to fa- vour in forne ihape or other, either to admiration, or t o love, or to pity, or 10 all three ; and the other, the man of thriftY1configned to infamy.

Hence it is that, in reviewing and adjufiing the intereits of there appa-

rently

rently rival parties, the advantage made by the borrower is To apt to flip out of

~ fight, and that made by.the lender to appear in fo exaggerated a point of view. Hence ir is, that though preju- dice i,s fo far foftened, as to acquiefce in the lender's making fome advan- tage, lcit the borrower fhould lore altogether the benefit of his afifiance, yet Rill the borrower is to have all the favour, and the lender's advantage is for ever to be clipped, and pared down, as low as it will bear. Firfi it was to be confined to ten per cent. then to eight, then to fix, then to five, and now lately there was a report of its being to be brought down to four ; with confiant liberty to fink as much lower as it would. The burthen of thefe refiraints, of courfe, has been in- tended exclufiveEy for the lender : in reality, as I think you have feen, ir

~xErs

Prqudice~ agai$ Ufigt. r oq

preffes much more heavily upon the borrower : I mean him who either be- comas or in vain wifhes to become fo. But the prefmts diretted by prejudice, Dr. Smith will tell us, are not always delivered according CO their addrefs. I t was thus that the mill-itone defign- d for the necks of thofe vermin, so they have been called,, the dealers in corn, was found to fall upon the heads of the conCumers. It is thus-but further examples would lead me fur- thcr from the purpofe.

c xo LETT. X I. Compound I~terfl. . .

L E T T E R XI. b

Compotlnd IiztereJ.

A Word'or two I mufi trouble you wit h, concerning cowipound intc-

r f l ; for compound intereft is dif. countenanced by the law; I fuppofe, as a fort of ufury. That, without an exprefs fiipulation, the law never gives it, I well remember: whether, in cafe of an exprefs fiipulation, the law al- lows it to be taken, I am not abfo- lutely certain. I ihould fuppofe it might : remembering covenants in mortgages that intereit kould become principal. A t any rate, I think the law cannot well punik it under' the name of ufury.

5 I f

If the difcountenance h e w n t o this arrangement be grounded on the har- ror of the fin of ufury, the irnpro- priety of fuch difcountenance fotluws. of courfe, from the arguments which flew the unfinfillnefs of that fin,

Other argument againft it, I believe, was never attempted, unlefs it were the giving ro fuch an arrangement the epithet of a bard one : in doing which, fornething more like a reafcrn is given, than one gets in ordinary from cl= common law.

I f that confifiency were to be 'found i n the common law, which has never yet been found in man's conduit, and which perhaps is hardly in man's na- ture, compound intereit never could h a r e been denied.

The views which fuggefied this denial, were, .I dare to fay, very good : .

j I 2 L BTT. X I. Comflo~nd IntereP. the effeRs ofit are, I am certain, wry pernicious.

If the borrower pays the intereft ar the day, if he performs his engage- ment, that very engagement to which the law pretends to oblige him to con- form, the lender, who receives that in- tereit, makes compound intereit of courfe, by lending it out again, unleis he choofes rather to expend it : he ex- peas to receive it at the day, or what meant the engagement ? if he fails of receiving it, he is by fo much a lofer. T h e borrower, by paying it at the day, is no lofer : if he does not pay it at the day, he is by fo much a gainer : a pain of diiappointmcnt takes place

' in the cafe of the one, while no fuch pain takes place in the cafe of the other. The caufe: of him whore. con- tention is to caick again, is thus pre-

ferred

LE^. XI. CompoundIntnc#, r r 8 fcrrcd to that of him whofe contention is to avoid a lofs : contrary to the rea-. fonable and ufcful maxim of that branch of the common law which has acquired th; name of equity. Tha gain, which the law in its tenderness thus beftows on the defaulter, is an encouragement, a reward, which it holds out for breach of faith, for iniquity, for indolence, for negli-

W"'= The lofs, which it thus throws up-

on the forbearing lender, is a punilh- ment which it inRi&s on him for his forbearance : the power which it gives him of avoiding that lofs, by profccut- ing the borrower upon the initant of failure, ir thus converted into a reward which it holds out to him for his hard-heartednefs and rigour. Man is not quite fo good as it were to be wilbed he were; but he would be bad

I indeed,

g 1 4 LETT. Xf. CompotindInt6ytj?. indeed, were he bad on all the occa- fions where the law, as fat as depends cn her, has tnade it his inte:efi fo to be.

It may be impofible, fay you, it often is irnpofiblc, for the borrower to pay the interefi at ehe day : and you fay truly. What is -the inference ? T h a t the creditor fhould not have it in his power to ruin the debtor for not paying a t the day, and that he fiould receive a cornpenfation h r . t h e loss oc- cafioned by fuch failure-He has i t i n his power to ruin .him, and he has i t not in his power to obtain fuch cornpenfation. The judge; were it pofible for an arrefied debtor to find his way into a judge's chamber infiead of a fpnging-houfe, might award a proper respite, fuited W ' the c i i c u n ~ fiances of t!l&parties. I t is not p o E ~ ble: but a ref'pite is purchased, proper

W

CETT. XI. Campound Imo/E; I I ~

or nor proper, perhaps at ten. times, pcrhps at a hundred .times the..ex- pence of compound- i-nterea, byr:put- cing in bail, and fighting the creditor .- - tbc~ugh all the windings of mifchiey* ous and unnece$ary delay. of. tb4

fatisfaRion duq either for the or,iginal fa.ilure, or for the fubfequent vqxation by 'which ir has., been aggravated,.no part is ev~r~rece ived by t h e injured -creditor: but thg initruments of thk laiv receive, perhaps .at his expence, perhaps at the debmr's, perhaps ien times, perbaps a hlodred! times. the amount of that fatisfa8ioa . 3uc-h ir the refult of this tendernefs o f the law.

It is in confequence of fuch tender- nefs that on i'o many occaGons a man, rhough ever CO able, would find him- felf a lofer by paying his j u f i debts: thofe very debts of which the law has i :!, . I 2 recognized

! 16 LETT. XI. Compound Intwqt. . recognized the jufiice. The man who obeys the diaates of common hondty, the man who does what the law pre- tends ro bid him, is wanting to him- felf. Hence your regular and fecurely profitable writs of error in the houfe of lords : hence ybur random and vindic- tive cofis of one hundred pounds, and two hundred pounds, now and then given in that houfe. It is natural, and it is fomething, to find, in a corn- pany of lords, a zeal for jufiice : it is not naturai, to find, in fuch a corn- . pany, a difpolition to bend down to the toil of calculuion.

Maintenancc and Cb'amptrp,

-H AVING in'the preceding letters had occafion to lay down, and,

as I flatter rnyfelf, to make good, the general principle, that no man of +c'

years, and ofjmrrrd mind, ougbt, out of .loving-kiilrdnej to bim, to bc bindered from makitgjucb barpin, in tbc Quay obtain- ing money, ar, aGfing witb bis eyes opt, be &m conducive to bis inter@, I will ,

-take your leave for pullling it a little farther, and extending the application .of it to another clafs of regulations it ill .lds defenfible. I mean the antique

. , 1 3 laws

f 18 LBTT. XII.'Maihfmamc. laws againit wha t are called Mainte- nance and Champerty.

T o the hrad of ~aintenanie, I think you refer, 'beljdu ophcr,offcnces'which are to the prefent purpofe, that of pur- chaf ng,..ypon any tg~,n~s, any, claim, which'it requires a fuit at law, o r . i n equity, to enforce.

Chapperty, which is but a.+i.Eii- Jar :madi6cation ,ofishis fin of MAC& nance, is, I thiak,. .the furnifhinge a man who has fuch'a claim, with regard to a real eftate, fuch mpney as he'may have' occafion fob to carry on fuch claim, iipon the terms of receiving r, parr of the eitate in cafe of fuccefs; ' .

w h a t the penaltts arc for ihcfe odnccs I do not recolle&, noor do I think it worth while hunting for them, $hough I have Blackitme at my elbow. They are, at any rate, fufficienrly f6-

. m verc

and Cbampw~y. 119

vcre to anfwer the purpoi'e, the rathec as the bargain is made void. .

T o illufirate the mifchievgofneLs 'of the 1 ~ ~ s by which they hav: beeq create& give me leave to tell you a ftory, which is but too true a n one, and which happened ro fal1,within my own ob~eivation. . . I

A gentleman of my acquaintance had fucceeded, during his minority, t~ an eitptn of about 3000 1. a. year ; 1 won't fay where. His guardian, conl cealing from him the value of the .

cfiate, which circumtlances rendered it eafy for him to do, got a convey- ance of it from him, during his non7

- age, for a .trifle. Immediately upon the ward's coming of age, the guardian, keeping him itill in darkneh, tound ..., ,

means to get the conveyance confirm- ed, Some years afterwards, the ward difcovered rhe value of the inheritance

I 4 he

roo LETT. XII. Mahtc110nct

he had been throwing away. Private rcprcfentations proving, as it may be imagined, ineffeauai, he applied to a court of equity. The fuit was in forne forwardnefs : the opinion of the ableR coudcl highly encouraging: but money there remained none. We all know but too well, that, in fpitc of the un- impeachable integrity of the bench, that branch of jufiice, which is parti- cukrly dignified with the name of equity, is only for thofe who can afford to throw away one fortune for t he chance of recovering another. Two perlons, however, were found, who, be- tween them, were content to defray the eXpehCe of the ticket for this lottery, on c&dirion of re~eivhg half the prize. The".pro@&t now became en- couraging: when unfortunately one of the adventurers, in exploring the re-

. ' cekof the bottornlefs pit, happened to

* d Cbawprty. r z f

dig up one of the old fiatutes againfi Champerty. This blew up the whole projee : however the defendant, un- deritaoding that, fome how or other, his antagonilk had found fupport, had thought fit in the meantime to prop& terms, which the plaintiff, after his fupport had thus dropped from under him, was very glad to clofc with. H e received, I think it was, 30001. : and-for that he gave up the citatq which was worth about as much year- l y , together with the arrears, which were worth about as much as the cltare.

Whether, in the bafbarous age which gave birth to thefe b a r b u s -precautionsr whether, even undcr the zenith of feudal anarchy, fuch fetter- ing regulations could have had reafon on their fide, is a quefiion of curiofity rather thaa uli. My notion is, th*.

there

g22 LETT. XII; fhm never w a n time, that them m- ~ t x wuld have bero,.or can be a time, *.a rchk pufhing of fiitors away from Ewrc with one h d , whi1.e they are b e ~ b d idto it wirh another, would w<l be, a policy equally faithkia, ia- r # l C h t , and ,+Curd. But, what -p !body mu%.. . acknar~lc+c,, . ;is, h t , to the times which .catled forth thdk laws, and in :which alone. tbey poulrb have ftartad. up; the p r e h t arc aa:.oppfite as .light to darknaf's, A &hief, in th& t i o t g it,feemsi but i w wmmon, though-a mifchief noc .to be cured by fuch laws, was, that. e man . w l d buy.;a ;weak claim, in h-. &at. power might .convert it

into. a .ftrong onc, and chat the fword of a baron, fialking ihto court with 8

rabble of retainere at his heels, m+ firike terror into the eyes of a judge upon the bcncb; At pnfcnt, w h a

cares

cfircs.a@~gli& judge. fpr +he3fwor& of. anl $ ~ & e d .barons ?rNejJler fkarr kg-W. k ~ p i r 7 ~ , hatkg q r ~ . h v i p g , {hp judgmof ,nur days i s $fa!$y n i tb equd phlqn d&nib, . .uppp a l l 9 E G P fions, :that fyBem, w b a t e y ~ i~ be, cif jIdtiee, w .injuaice; ~hi~k.tbe.law hm PM irgg his: hpnds.. ,A.di&.phtion c o a h k c !o d3ty copM p ~ t i have th~p been :liopd for : - onerwprq c4r~fqna~e is hardly :so. be w&cd .... Wea1th.h~ . indred the rnonopoiy, ,ofj u&i,ce'agdin% poverty :- and fuch r)mi,~pdp is $ 4 ~ dire&- tcndency andraecjefbry efTyCk 4f regulari~nr like thek tie firwgthen abd corifiietn; But with zhin nioonpoly W judge thar.tives now bat aP chargeable. The .law, created this monopoly : 'he lam, whenever it plreaf %may diKolveit.

I will iror however b l far wandar frsm'my LbjgB as to qquire w'hat

a . meafurc

*r 24 LEPT. XII. ~a i in rancc

:mcafure might have been neccirary to afford a full relief to the cafe of tha t unfortunate gentleman, any more thart t o the cafes of CO many other g e n t l e men who might be found, as unfortu- nate as he. I will not infiA upon fo itrange and ib inconceivable an ar- .rangement, as that of the judge's fe- ing both parties face to face in the 6tit

' infiance, obferving what the fa&s a re in difpute, and declaring, that as t h e

. f aas ihould turn out this way or that . way, fuch or fuch would be his decree. '4t prrfent, I confine myfelf to the removal of fuch part of the rnifchid, ae may arife from the general conceit o f keeping men out of difficulties, by cutting them off from fuch means o f relief as each man's fituation may af-

, ford. A fpunge in this,-as in CO many other cdcs, is the only needful, and

only

. 4 C b a m ~ . 125

only availing remedy: one Rroke of it for che mufky laws againit maintenance and champerty : another for the more recent oms againi) ufury. Confider, for example, what would have rcfpcc- tively bcm the e m of two fuch Rrokcs, in the cafe of the unfortunate gentleman I have been fpuLing of. By the fir& if what is called quity bu any claim to confidence, he would bave got, even rfter paying of his champerty-ufurcn, r p l . a year in land, and about as much in money a i n R d ofgetting, and that only by an accident, 3000). OnCC tdd. By the' other, t h m i v o faying towhar a db, gm he might have been benefited. May I be allowed to firetch CO far in favour of the law as to fuppofe, that fo fmall a iirm as 500 1. would hwe car- ried him through his fuir, in thecourfe of about thiee years ? I am fenfible,

that

p& LETT; 'XI&. i W M t n a n c ~

&at miy .tYe,hughc but,? fhorr futni; md thia bw &b~, term, R &it in equity.: but; -M. the purpefe of illuf- tration, ia rni+y:fare: & wdlm a longer. Suppdc :hd had f m g h t . . t h i ~ ,meflary fumb i m r h e ' ~ ~ y h f Gsrrowimg ; and:had been ,io ,lrtGnatc, .Q?, as :.ik laws

. .- winit tbe: :fin.of ' ~ f u r y wolrtdftile it, $ unhttumnef .as to get St'at: 2 0 0 per tidnt. . He wodd then have purchafed hid 6mol. a.ycac atrhcprice,of hdf as niuch~omc.lmd, vk. ggcool. ; i n k a d 06 ielling it At that price. Whether, if no bch laws again8 yfury had bccd in being, he , c~ ,uld hnvd got he money. d e n at tbst r a n , 1 a i U nolgrprend m f i g : pechapht eight not ,lrave.got i t upder ,ten gimes. t.hat ratqf. perhaps he ri)ight; have gpt ;it a t .the .ten84 part of rhac F*.; Zhus far,. .l tbkk, we may #y, zhat ,.he; .might; and:!.pr~bably ,wo~id, , !h~e beeta&e:betr~fer the m- . . 6 peal

. . . . :. d. Warn)&.&, .rz.I l o p

ixw1 of thdee'-laws:. bot , t hw, fa r .de muR fay, theat it is impoffhle:hrt:@uId . '

have been tk.wbrfe. T h e tqrmq u p on. which:-he' mes with' a d v e n t ~ ~ r e n . willing to relidve! Km, though they come.. not within &at fcanip ..SleH, which the* la@,'in the: narr&nefa'of 4:s vi,eUs, calll- duk'y,. do, in the . p e h t cafe, at.twenty.)eai's' purchak10f ,the gom l. a year hti 'wa9 .contktit-te..k&~ &erificed f o r : W h ~fllRanke;' Ilmbtrnt, in effe&, to 40W pet cent. WMAet i t was likely that any man,. who was difpofed to venture his rrioney,.at all, .

' t upon fuch a chande, ;would 'have thought of infilling u idn fuch'a fate of intereit, I will leave you to ima- gine: but thus much may be faid with confidence, becaule the fa& dernon- ftrates it, that, at a rate not exceeding this, the {urn would aQually have been fupplied. Whatever becomes then of

, . . the

the laws againR maintenance 'and cbrmpcrty, the example in queition, when applied to the laws againR ufu- ry, ought, I think, to bc fufficient to convince us, that fo long as the cx- pence of faking relief at law Rands on itsn pdcnt footing, the purpofc of faking that relief will, of itfclf, indc- pcndently of every other, a6rd a fuf- ficient ground for allowing any man, or every man, m borrow money on any terms hc can obtain it.

LETT. XIII. STo Dr. Smilb. I 29

L E T T E R XIII.

To Dr. Smirb, ott P r ~ c f l ~ in kt~, 3 c .

S I R ,

I Forget what fon of controveriy it was,, among the Greeks, who hav-

ing put himlr1.f to.fchool, to a.profeiror of eminence, to learn what, in thofe days, went by the name of wifdonl, chofe an attack upon his maiter for the firR public fpecimen of his profi- ciency. This fpecimcn,. whatever en- tercainment it might have afforded to the audience, afforded,, it may be {up- pofed, no great facisfa&ion to the maf- ter : for the thefis was, that the pupil

K owed

a30 LETT. xn1. Dr. h i l b ,

owed him nothing for his pains. F o r m y part, being about to h e w myfelf in one refpea as ungrateful as t h e Greek, it may be a matter o f p r d e n c e for me to look out for fomething like candour by way of covering to my in- gratitude : infiead therefore of pre- tending to owe you nothing, I h a M begin with acknowledging, t h a t as far as your track coincides with mine, 3

. h o u l d come much nearer the trcth, were I to fay I owed ,you every thing. Should it be my fortune to gain any advantage over you, it mufi be with weapons which you have taught me te

wield, and with which you yourfelf have furnihed me : for, as all the gpeit fiandards of truth, which can be np- p l e d to in this line, owe, as far as 1 &an underl;tand, their efiablifhment to you, I can lee fcarce any other way af anviLt in8 yw of any .error or over-

.fi& h t,

fight, than by judging you out of your own mouth.

In the teries of letters to which this will form a fequel, I had travelled nearly thus far in my refearches into the policy of the laws fixing the rate of interefi, combating fuch arguments as fancy rather than obfervation had fug- gefted to my views, when, on a fud- den, recolleaion prefented we with your formidable image, befiriding the ground over which I was travelling pretty much at my eafe, and oppafing t h e fhield of your authority to any ar- guments I could produce.

I t was a refleaion mentioned by Ci- cero as affording him fome comfort, that the employment his talents tili that time had met with, had been chiefly on the defending fide. How little foever bleit, on any occafion, with a n y portion of his eloquence, I may,

K 2 on

132 LETT. XIII. To B. Smitb,

on the prefent occafion, however, in- dulge myfelf with a porcian of what

- conitituted his comfort : for, if I pre- fu:ne to contend with you, it is only in defence of what I look upon as, not only an innocent, but a moft merito- rious race of men, who are fb unforru- nate as to have fallen under the rod of your difpleafure. I mean prqe8urs : ,

under which invidious name I under- itand you to comprehend, in particular, all fuch pcrfons as, in the purfuit of wealth, itrike out into any new chan- nel, and more efpecially into any chan- nel of invention.

It is with the profeKed view of checking, or rather of crulhing, thefe adventurous fpirits, whom you rank

l

with " prodigats," that you approve ~ of the laws which l in i t the rate of in- terefi, grounding yourfelf on the ten- dency, they appear to you to have, to

keep

or1 Projctls in Arts, VC. 1 3 3 keep the capital of the country out of two iuch different iets of hands.

The paffdge, I am fpeaking of, is in the fourth chapter of your fecond book, volume the fecond of the 8vo edition of 1784. " The legal rate " (you fay) " it is to be obferved, though CL it o.ught to be fornewhas above, "ought not to be much above, the " loweR market rate. . If the legal rate " ofintereft in Great Britain, for exam- L ( ple, was'fixrd lo high as eight or tcn c4 per cent. the greater part of the mo- " ney which was to be lent, would be " lent to prodingals and projedors, who 6 L alone would be willing to give this " high intereft. Sober people, who L L will give for the uk of money no " more than a part of what they are " likely to make by the ufe of ir, L6 wou.ld not venture into the compe- C6 - - anon. ' A great part of the capirsl

K 3 of'

I LETT. XIII. To Dr. Smitb, " of the country would thus be kept " out of the hands which were rnofi " likely to make a profitable and ad- " vantageous ufe of it, and thrown " into thofe which were mofi likely to " wafte and defiroy it. Where the " legal interefi, on the contrary, is " fixed but a very little above the " loweit market rate, fober people are " univerfally preferred as borrowers, " to prodigals and projeilors. T h e b

" perfon who lends money, gets nearly " as much intercfi from the former, as " he dares to take from the latter, -

and his money is much fafer in the " hands of the one fee of people than I

" in thofe of the other. A great part l

!' of the capital of the country is thus " thrown into the hands in which it '' is moit likely to be employed with Lb

l L advantage."

I t happens fortunately for the fick YOU 1

you appear to have taken, and as un- - - fortunately for mine, that the appella-

tive, which the cnfiom of the language - h,as authorized you, and which the po- verty and perrerfity of the language has in a manner forced you, to make ufe of, is one, which, along with the idea of the fort of perfons in quefiion, conveys the idea of reprobation, as in- difcrirninotely and dekrvedly applied to them. With what jufiice or con- iiftency, or by the influence of what cauies, this Itamp of indifcriminatc re- probation has. been thus afixed, it is not immediately neceEary to enquire. But,that it does Rand thus affixed, you and every body elfe, I imagine, will bc l

I ready enough to allow. This being . ,

the cafe, the queltion itands already , decided, is the firIt infiance at leait, if not irrevocably, in the judgments of 1 all thofe, who, unable or unwilling to ' '1

be 1

K 4 I 1

136 LETT. XIII. To Dr. Smith,

be at the pains of analyfing their ideas, fuffer their minds to be Icd captive by the tyr&ny of founds: that ie, L doubt, of by far the greater propor- tion of thofe whom we are likely ro have to judge us. In the conceptions of all fuch perfons, to aik whether i t be fit to reltrain .projetts, and projec- tors,*will be as much as to aik, whe-

t.her it be fit to reitrain raihneis, and fally, and.abfurdity, and knavery, and w a k .

Of prodigals .I h a l l C-y no more at prerrnt. I have already ftated my rea- ibns for thinking, that it is not among them that we are to look for the nata- ral cufiomcrs for money at high rates of iaterelt. A5 far as thofc .reafons are concluf W, it will follow, that, of' the two forts of men you mention as proper objeEts of the burthcn of thefi

'tefiraints, pr3disals and proje&ots, . ~ h i ~ f

on Projet7s in Arts, Uc. 1'3 7 that burthen falls exclufively on the latter. As t o thefe, what your defi- nition is of proje&ors, and what de- fcriptions of v r i o n s you meant to in- clude under the ceniure conveyed 'by that name, might 'be mareiial for the purpofe of judging of.the propriety o f that ceniure, but makes no differ- ence in judging o f the propriety of the law, which tha: ceniure is employ-

. ed to jultify. Whether you yourfclf, were the f'veral clafles of perfons made t o pars befare you in review, would be difpafed to pick out t h i s or that djafs, or t l i s and that individual, in order to exempt them from fut h cen- re, is what for that pnrpafe we have n o need to encjuiie. T h e law, i t is certain, makes no filch diitinEticns, i t fal ls with eqoal wighr, and with all .its weight, upon all thofe pt-rfon,s, wi:hout diltinaion, to whom. the term p~t,?;;~, in the mvft un.parri:l a n d

ex~enfive

138 LETT~XIII. Ib Dr. Smicb, extenfive fignification of which it is capable, can be applied. Tt falls a t any rate (to repeat fome of the words of my former definition), upon all Such perfons, as, in the purfuic of wealth, or even of any other ob- je&, endeavour, by the afifiance of wealth, to firike i ~ t o any channel of invention. . I t falls upon all fuch per- fons, as, in the cultivation of any of thofe arts which have been by way of eminence termed ujful, dire& their en- deavours to any of thofe departments in which their utility ihines mofi con- fpicuous and indubitable ; upon all fuch perfons as, in the line of any of their purfuits, aim at any thing that can be called improvement ; whether it confifi in the produlkion of any new article adapted to man's ufe, or in the meliorating the quality, or diminithing the expence, of any of thofe which are already known to us. I t falls, in

fhortr

fhort, upon every application of the human powers, in which ingenuity ftands in need of wealth for its aC filtant.

High and extraordinary rates of in- terefi, how little foever adapted to the fituation of the prodigal, are certainly, as you very jufily obferve, particularly adapted to the fituation of the pro- je€tor : not however to that of the im- prudent projettor only, nor even to his cafe more than another's, but to that of the prudent and well-grounded projettor, if the exiltence of iuch a being were to be fuppofed. Whatever be the prudence or other qualities of the projell, in whatever circumfiance . the novelty of it may lie, it has this circumfiance agami? it, viz. that it is new. But the rates of interefi, 'the highefi rates allowed, are, as you ex- prefsly fay they are, and as you would have them to be, adjufted to the fitu-

aoion

140 LETT. XIII. To Dr. Smith, ation which the fort of trader is in, whore trade runs in the old channels, and to the beR fecurity which fuch channels can afford. But, in the na- tun of things, no new trade, no trade carried on in any new channel, can af- ford a fccurity equal to that which may be afforded by a trade carried on in any of the old ones : in whatever light the matter might appear to per- f& intelligence, in the eye of every prudent perfon, exerting the beit pow- ers of judging which the fallible con- dition of the human faculties affords, the novelty of any commercial adven- ture will oppofe a chance of ill fuccefi, Cuperadded to every one which could attend the fame, or any other, adven- ture, already tried, and proved to be profitable by experience.

T h e limitation of the profit t h a t is t s be made, by lending money to per- Sons rmb3rlced in rrade, wil! render the

mcnicd

monied man more anxious, you may fay, about the goodnefs of his fecu- rity, and accordingly more anxious to Catisfy himfelf refpeaing the prudence of a pro&&, in the carrying on of which the money is to be employed, than he would be otherwife : and in this way it may be thought that thefe laws brrvo a tendency to pick out the good projeas from the bad, and fa- vour the former at the expence of the latter. The firR of thefe pofitions I admit : but I can never admit the conlequencc to fbllow. A prudent man, (I mean nothing more than a man of ordinary prudence) a prudent man aaing under the fole governance of . prudential motives, I fiill fay will not, i n thefe circumfiances, pick out the good projelts from the bad, for he will not meddle with projeRs at all. He will pick out old-efiabliihed trades

from

142 LETT. XIII. 2'0 Dr. Smirb, '

from all hr ts of projeas, good and bad; for with a new projee, be it ever fo promifing, he never will have any thing to do. By every man that has money, five per cent. or whatever be the highefi legal rate, is at all times, and always will be. to be had upon the very beft fecurity, that the beit and moit profperous old-eltabliihed trade can afford. Traders in general, I be- lieve, it is commonly underfiood, are well enough inclined to enlarge their capital, as far as a11 the money they can borrow at the highefi legal rate, while that rate is fo low as 5 per cent. will enlarge it. How it is pof- fible therefore for .a projea, be it ever fo promiGng, to afford, to a lender a t any fuch rate of interefi, terms equally advantageous, upon the whole, with thofe he might be fure of obtaining horn an old-efia blilbcd bu fine&, is more

than

X on Projeas ifi Arts, @c. I 43

than I can conceive. Loans of mo- ney may certainly chance, now and then, t o find their way into the poc- kets of projeaors as well as of other men : but when this happens it mufi be through incautioufnefs, or friend- %hip, or rhe expettation of fome colla- teral benefit, and not rh~ough any idea .of the advantagwufnds of the tranfac- tion, in the light of a pecuniary bar- gain:

I fiauld not expeEt to fee it alleclged, that there is any t'hing, that ihould rcn- der the number of wrll-groundcdpro- jrAs, intmmpauifon.of rhe ill-grounded, leis in fime future, than i t bas been in

-sime p&. I am fure at lealt that I know of rro realbns why it fhould be h, though I know of Come scafons, which 1 h a l l beg leave to f ~ ~ b m i t to

gae by an8 by, which appear ro me

9 prerty

144 LETT.XIII. To Dr. Smitfi,

pretty good ones, why the advantage ihould be on the Iide of futurity. Bus, unlefs the flock of well-grounded pro- je&s is already {pent, and the whole cock of ill-grounded pro$&s that ever were poffible, are to be looked for exclufively in the time to come, the cenfure you have paired on projec- tors, meafuring fiill the extent of it by that of the operation of the laws in the defence of which it is en~ployed, looks as far backward as forward: it con- demns as raih and ill-grounded, all. thofe projeh, by which our fpecics have been fucceffively advanced from that itate in which acorns were their food, and raw hides their cloathing, to the itate in which it fiands at pre- f a t : for think, Sir, let me beg of you, whether whatever is now the rourilrr of trade was not, at its commence-

men t,

ment, projeEt P whether. whatever is now c/)obhfimcnt, was not, at one time; innovation ?

How it is that the tribe of well- grounded projeds, and of prudent pro- jettors (if by this time I may have your leave for applying this epithet to fome at lea& among the proje&ors of time palt), have managed to Rreggle through the obfiacks which the laws in queltion have been holding i.n their way, it is neither cafg to know, nor neceflary to enquire. ManifeR enough I think, it mufi b e by this time, that dificu.lties, and. thoft: not inconfider- able ones, chore laws muft have been holding, in the way of proje&s of all forts, of improvement*(if I may fay To) in every line, To long as they have had exiftcnce : reafonable therefore it mufi be to conclude, that, had it not been for thck dikouragements, projc&s pf

L a11

346 L~TT. XIIT. f w Dr. Smit5, .all lbrtq well-goonded and fuccefsful mes, as well as otbers, would have been' more numerous than they have;-been : and that accordingly,onthc other hand, as ioon, if ever, as thefe dgourage. .merits fhall be removqd, p r o j d s of all &rts, and among the reR, well-ground- ed and fuccefsful ones, will be more numerous than )they would otherwife hove .been : in hart, that, a, withouc thefe difcouragcrnents, the progrds of mankind, in the career of profperity, .would have been greater, than it has .been under them in time pafi, fo, were they to be removed, it would be at leafl proportionably greater in time future.

That I: have done you no injufiice, i n afigning to your idea of projettors ib great a latitude, and that the unfa- vourable opinion you have profcffi to entertain ofthern is not c o a h d ta

hc

m Projc.k?$ in &hr WC. I 47 the aboue pa&e, .might be made, 1 k i n k , pretty appmnr, if it be mate- rial, by another paffage in ebe tenth chapter of your ArR book *. " The " aftabliihment of any pew manufac- C& turr, of any new branch of cop- 46 mercc, or of any new prattice is " agriculture," all thef' you compre- hend by name under the lifi of " prod

jetts:" af every one of them you ob- ferve, that " it is a fppeculation from " which the projeElor promises hirniclf " extraordinary profits. Thek pro- " fits (you add) are fometirnes very 6 6 great, and Cometimes, more frequently

perbaps, they are q t d e otberzviji : bu e " in general tllcy bear no regular p m " portion to thofe of other old trades " in the neighbourhood. If the pro- ' jet3 fucceads, they arc commonly

148 ~ETT.XIII , $0 Dr. $&k, " at firit very high.. .When the track " or praQice becomes thomugbly e R i ~ " blilhcd and well known, the corn, " petition reduces them m the level o f a t other trades." But on this head X forbear to inf R : nor ihouM I have taken this liberty of giving you back . your own words, but in the hope of feeing rome alteration made in them in your next edition, fhould I be fortunate enough to find my fentiments confirm- ed by your's. I n other refpeBs, what is elIentia1 to the publick, is, what the error is in the fcntimcnts entertained; not who it is that entertains them.

I know not whether the obf i rva tions which I have been troubling you with, will be thought to need, or w h t ther they will be thought to receive, any additional fupport from . rho& comfortable poftions, of which you have mid= f'ch gcod and fuch frc-

quent

- - *n PkOjCtk 'ii Ails, @C.'. 149 quent uk, concerning the conftant ten- dency of mankind co get forward in the career of pmfpericy, the prevalence 4 prudence over imprudence, in the rum of private condull at leaR, and the fuperior fitaefs of individuals for managing their own pecuniary con- cerns, of which they know the parti- culars and the circudances, in corn- .parifon of the Icgiflator, who can have no loch knowledge. I will make the erperi&at : for, lo long u I have the mortificarion to fe you on the oppo- 5 te fide, I can never think the ground* .I have taken itrong enough, while any thing remains that appears ca- pable af rendering it itill Rronger.

" With regard to mifcondu&, the " numikr ofprudent and fucceisful un- C L . dcrtakirgs" (you obierve*)" is every

*3,II.ch.iii.edit. 8vo 1784, ml. ii . p.ro.

r50 LETT:X.IIL, $0 Da k i tb ,

" whrrc mooh grestcr rhtm~thut d m- '' judicious and : \rduccrfiful .ones, " After all our complaints -of the fre- . " qmncy of bankruptcies, the unhap- !' py men whb fall into this mishr-

tune make but a very fmall part og " the whole number engaged in trade, '' and lrll other forts of bllfinefs ; not U much more perhaps than one in-a

thoufand." 'Tis in fupport sf this pokbn that

you appeal to hifiory for the confiant and uninterrupted prognfsof,mankind, in one ifland at icatt, in the carar of profperity : calling upon any one who kould entertain a doubt of the fa&, to divide the hiRory into any number of periods, from the time of Cerar's vifit down to the prefmt : pro- poring for infiance the refpe&ive aras of the ~eitoration, theAccefion ofEli- zabeth, thzt of Henry VII. the Nor-

7 man

. ' . m P+Ws in Arh, HE. 8.51' ntan CmqucR, and the Heptarchy, and putting it to the fceptic,to find out, if he can, among all there periods, any one !at which the condition of the country was not- more profperous than sc the period immcdiacely pr&eding it ; fpite of b manywars, and fires, and plagues, and all oher public cala- mities, with which it f#ts been at dif-' ferent times afflitted, whether by the hand of God, or by the mifconduR of the fivereign. No veryeafy t a h , I be- lieve : the fa& is too manifelt for c he mofi jaundiced eye to efcape feeing ic :-Bue what and whom are we to thank for it, but proje&ts, and pro- jeAors ?

" No," I think E hear you laying, " I will not thank projchrs for it, I "' will rather thank the laws, which by L6 fixing the rates of intereit: have U - been exercifing their vigilance in

L 4 LL reprening

1:s". LETT. XIII. To Dr. W&, " repreang thq temerity of proj&ors, " and prevcntiqg their imprudence from making chore defalcations from " the fum of ~ t i ~ n a l profperity which '' it would n q have, failed to make, 'c had it been left free. . If, duriag all " thefe periods,, that adventurous race U of men had been left at liberty b; '' the laws to give full fcope,to their C L rafh enterprizes, the increak of na-

'! tional profperiti during thefe periods -. " might have afforded forne ground - " for regarding them in a more favour- U able point of view. But the fa& is, " that their a&ivity has had thefe laws ': to .check it; without which checks " you mufi give me leave to fuppofe, " .that the cuuent @f pro@erity, if not " totally Gopt, or turned the .other " way, would at any rate have been " more or lds retarded. Here then" (you .conclod$ I' lies the difference

U ,, betwcea

" between I+: what you look, ypon " .as the caufe of the increde about " which we are both ,.agreed, I iwk 'G upon as an obitacle to it : and what "'jcy look upon as the obRqficn I look

upon as the cauG." .

Infiead of fiatin8 thk as a Ton d plea that might be urged by you, I oughq p c r b s , , rather to have men- tioned it as what might h urged by forne people in your p.lace: far as I do not imagine your peneuati~n would fuffer you to reR fatisfied with it, flill lefs can I- fuppofe that, if you were not, your candour would allow you to make lafe of it as if you were.

To .prevent your reiting ktisfied with it, the following confiderations would I think be fufficient.

In the firR place, of the {even pc- riods which you have pitched upon, ns fo many Rages for the eye to re&

a '

i t in. vi'kvingl the progref3 of pro*- rity, i t is on* during die three lafi, that she ~&untry has a kl the benebt, if fuch we are to call it, of thde laws : fot k is to the reign of Henrp"VW1. that owc the fim bf ihrm. ' .

- Hcrc i muhi tudeaf~udt ions might be'fiartk'd : W h e t h t r r k t h i n g of proj&ftors 'formed any par t of -the de- iign. df that ffrR ftatute, or.whether the views of it w e k not wholly can- fined to . the . , reducing the gains of tha t obnoxious. and envied clafs of men, the money -lenders? Whether projeflors have been ,m& abundant before char ftatute, or fince that ftatute? A n d w k r k the nation haJ fiffered, as you might fiy-benefited, as I hoald fay, mofi by them, upon the whole, dur- ing rbe former period' or the latter ? All thefe difcufions, and Inany more that might be Itarted, I decline engag-

ing

iag in, as more JikeIy to r e d ; than to fomard, mar cornin$ to mg agrcb mean conczrniog .the main quqftion.

In the'nwtt place, I mull beto &e ,

the l ibmy of rrferring you m ,tk proof, d k h I think I hav~c-dredj given, of the propofition, tfur )the m- A r h in queftion could rwrm have had tk, tff&, in any degree, ef kffen- ing tk proponion of bad projelSZs to good ones, but only of dirninifing, as far as their influence may have cn- amled, the total number of pmjeEks, good and bad together. Whatever therefore was the general tendency of the projeRing fpkit prcoioufly to the firit of thefe laws, fuch it muit have remained ever fince, for any eff& which they couM have had in purify- ing and correaing it.

But what may appear more fatisfac- tory perhaps than both the above con-

* fiderations,

iidaratioas, and may a&rd .U .the M help towardd8e~tt rica t ' i ~ a r f e l v e s from the-perplexity, which the plea I have Qecn combating (and which I thought' it necefErry to bring to view, as thc befi that could, be urged) feems much better calcnlated .to plunge us into, (had bring us out of, is, the cmfide- ration d the fmall e f f ' which the greatelk waRe that cm be conceived t o have becn'made within any compafs o f time, by iajudicicws projeas, can have had on the fum of profperity, even in the ellitnation of thde whofe opinion i s mofi unfavoura.ble to projdkors, in sompariibn of the cff& which within she fame clompafs of time rnufi have been p rod uced by prgdigality.*

Of .the two cauies, and only two caufes, which you mention, as contri- buting to retard the accumulation of

, national wealrh, as fir as the condua '

' of

on Projetts in &S, VC. 15.7 _ of individuals is concerned, p m j a n g ,

as I obfirved before, is the one, and prodigality is the other : but the de- triment, which focicty a n receive even from the concurrent efkacy of both theii caufes, you reprcfent, on fcve- ial occafmns, as incodidcrable ; and, if I do not mifapprehcnd you, too inconfiderable, either to need, or to warrant, the interpofmon of govern- ment to oppofe it. Be this as it may with regard to projcAing and pro- digality taken togelher, with regard to prodiga1:lty at leait, I am certain I do not mifapprehend you. On this

, fubjelt you ride triumphant, and chaltik the " impertinence and p c - 6 6 fumption of kings and minifiers,"

with a tone of authority, which it re- quired a courage like you~'s to ven- ture upon, and a genius like your's

to

c58 L~az. XIII. .!C@ Dr. Snrith, 70 warrant a man to affume *. After drawing the parallel kfweun private thrift and public profu'uCon " It is " (you coaclude) " the high& imper- " tineme and prcfujnpoion therefore in '' kiw apd miniItero t o pjd ta 4 6 wtrb M tbs :pomp Bp p i w o f a 4 6 #eOPJI, and to rehain their cxpencc, " either by fumprvary law or by " prohibiting rhc importation of fo- f' reign luxuries. Thcy arc thamklves .' always, and without exception, the

greateR fpendthrifts in the Cociety, " Lct them look well after their own " cxpcnce, and they may fifely truA " private people with theirs, If their 4 6 . own extravagance does not ruin

the ftate, rhat of their fubjdts never :" will,"

+ 8. 11, ch. iii vol. ii. p. 27; edit. 830.

That

Prg'eCsj $ rb.ts,.Uc( : r $9 That the e q l o y i n g the axpedienq

you mention for reitraiaimgT ynoctig* lity, is indeed generally, perhqs.even without exception, iqproper, and in many caiis cvcn ridiculous, I agree with you.+ nor will I hcrc itep dadc from my fubjea to defend frorn that imputation another mode iuggdted in qi former part of chde papers. But however preiumpttaow and imptrti- nent i t may bn for the ibrrcreign to at- tempt in any wiry to check by kgal refirainu tkc po&pJitr of individuals, to aKCWt to check thdir .Bad i~~wg:t~- .went by iuch. reltraints feerns abun- dantly more h. To err in the way of prodigality is the lot, though, you well . obiervc, not of maty men, in .cornparifon of rhe whole mars of man- kind, yet at leaft of any man : the ItuK fit to make a prodigal of is to be found i n wcry dehoufe, and under every

hedge.

f 60 L&T. XI1I.- r e Dr. Mtb, hedge. But even to err in the way of proje&ting is the lot only of the privi- leged few. Prodigality, though not fo common as to make any very ma- terial drain from the general mars of wealth, is however too common to be regarded as a mark of diRinEtion or as a fingularity. But the flepping afide from any of the beaten paths of traffic, is regarded as a fi ngularity, as ferving to difiinguifh a man from other men. Even where it requires no ge- nius, no peculiarity of talent, as where it confiRs in nothing more than the finding out a new market to buy or fell in, it requires however at lcaL a 1 degree of courage, which is not to be 1 found in the common herd of men. What &all we fayof it, where, in ad- dition to the vulgar quality of cou- rage, it requires the rare endowment of genius, as in the infiance of all thok

fuccefiive

fucceEve enterprizes by which a-m and manufaaures have been .brought from their original nothing ro their prefent fplendor ? Think how fmall a part of the comnlunity thefe muft make, in cornparifon of the race of prodigals ; of that very race, which, were it only on account oflTthe fmall- nefs of its number, would appear too .inconfiderable to you to deferve atten- tion. Yet prodigality is effentially and neceilarily hurtful, as far as it goes, to the opulence of the fiate : proje&- ing, only by accident. Every prodi- gal, without exception, impairs, by the very fuppoficion impairs, if he does not annihilate, his fortune. But it certainly is not every projeAor that impairs his: it is not every projeltor that would have done fo, had there been none of thofe wife laws to hin- der him: for the fabric of national

M opulence,

162 LZTT. XIII. 9-0 Dr. Smith, opulcncc, that fabric of which y o u proclaim, with fo generous an cxulta- tion, the continual incrcale, that fa- bric, in every apartment of which, innumerable as they are, it required, the reprobated hand of a projeltor to

lay the firk none, has required fome hands at leak to be employed, and that fuccefsfully employed. Whcn in comprrifon of the number of prodi- gals, which )s too inconfiderable to dcferve notice, the number of projec- tors-of all kinds is fo much more in-

. confiderablc--and when from this in- conliderabk number, muR be daduQ- cd, the not incoafiderabk proportion of fucceisful proje€tors-and from this remainder again, all thok who can carry on their projeas without need of borrowing-think whether it is paifible, that this lait remainder could afford a multitude, the reducing bf which

would

on Prqck?~ in Arts, &'c, I 63 would be an objeQ, deferving' the in- terpofition of government by i r a mg- nitude, even taking for granted tbzt it were an obje& proper in its na- ture ?

If it be fiill a querition, whether it be'wotth while for governMe-nt, by its =a@, to attempt to cencroul the cm- dull af men vifibly and undeniably under the dnminbn of paJm, and afiing, under that dominion, contrary tb the dldates of theit bwn reafon ; in h a r t , to eRe& whht is acknowledged to be their better judgment, againft what every body, even thtmfclves, utoltld acknowledge to be their worfe; i~ it endurable that the kgiI?aiar fiuutd by violence fubfiifete his own petended reafon, the refult of a tnd- mentary and fcornful glance, the off- fpring of wantonneis ond arrogance, much rather than of focial anxiety and

M 2 fiudy,

, i 64 CE~T. XIII. fi Dr; ~rnitb, fiudy, in the place of the humble r e d ion of individuals, binding itfelf with. all its force to that very obje& which he pretends to have in view ?-Nor let it be forgotten, that, on the fide of the individual in this itrange compe- tition, there is the moit perfe&t and minute knowledge and information,' which interefi, the whole intereft of a man's. reputation and fortune, can err- fure : on the lide of the legiflator, the moit perfelt ignorance. All that he knows, all that he can know, is, that the enterprize is a projeR, which,mem- ly becaure it is fufceptible of that ob- noxious name, he looks upon as a fore of cock, for him, in childiih wanton- nefs, to ihie at.-Shall the blind lead the blind ? is a quefiion that has been put of old to indicate the height of

. folly : but what then &all we fay of him who, being neceffarily blind, in-

fiRr

fins on leading, in paths he never trod in, thofe who can fee ?

I t mufi be by fome diRinCtion too ' fine for my conception, if you clear

yourfelf from the having taken, on another occaGon, but on the very point in queftion, the fide, on which it would be my ambition to fee you fix. " What is the fpecics of domefiic

" indilfiry which his capital can em- " ploy, and of which the produce ir " likely to be of the greateft 'value;' " every individual " (you fay *), " it L6 is evident, can, in his local fituation,' ,"judge much better than any Ratef- C' man or lawgiver can do for him.' C' The fiaterman, who fhould attempt " to dire& private people in what f manner they ought to employ their

P* iv, ch, 3, vol. ii. p. 182. edit. 8v0.

M 3 capitals;

866 LZTT. BIII. To Dr. Iplritb, '' capirrls, would mt wily bad hirn- " felf with a moit unneceflary atten- '' r,i~n, but af irae an authority which " coukd Cafely be trufted, not onlr EO " no fingk perfen, but to no ceuncil " or h a t e whatloever, and which '' would no where be fo dangerous as " in the hands o f a man who had folly " and prefumption enough to fanc)r '' hirnfilf At tsexqrcife it. '' T o give the monopoly of the

" home market t o the produce of do- '& ~ l t i c ! indufirjr, in m y particular

art or tpanufdure, is in form mea- " fuw to dire& private people in what 6 L manner they ought to employ their

" cepitals, and rnuR in alrnofi all cafes " be either a ufdeb or a hurtful q u - 66 1ation."-Thus far you : and S add, to limit the legal intereit to a rate at which the carriers on of the oldefi and belt-efiabliihed and leait hazardous

trades

im ~ r d e ~ k irr %ts, @c: i 67 trades are always g l d to borrow, is to give the monopoly of the money-mar-, ke t to thde traders, as againit the pro- je&orr of new-imagined trades, not one of which but, were it only from the circumfiances of i t s novelty, muR, as I have already obferved, appear more hazardous than the old.

Thefe, ie. comparilon, are but iG .conclufive topics. I touched upon shem merely as affording, what a p peared to me the only ihadow of a plea, that could be brought, in defence of the policy I' am contending againit.' 1 come back thqefore to my fir& ground, and beg you once more to confider, whether, of all that hofi of. manufattures, which we both exult in as the caufes and ingredients of na.. cionai profpuicy, there be a fingle one, that could have exifted at firR but in she &ape of a projea. But, if a re-

M 4 gulation;

gulation, the tendency and effe& of which is merely. to check projetks, in as far as they are projeas, without any fort of tendency, as I have ihewn, to weed out the bad ones, is defeniible in its prefent itate of imperfell effica- cy, it kould not only have been de- fenfible, but much more worthy of our approbation, could the efficacy of it have been fo far firengthened and cornpleated as to have oppofed, from the beginning, an unfurmountable bar to all forts of projetks whatfoever : that is to fay, if itretching forth its hand over the firit rudiments of foci- ety, it had confined us, from the be- ginning, to mud for our habitations, to &ins for our cloathing, and to acorns for our food.

I hope you may by this time be difpofed to allow me, that we have not been ill ferved by the projeas of

time

on Projegf iv Arts, @c: 169 time pait. 1 have already intimated, that I could not fee any reafon why we ihould apprehend our being worfe, ierved by the projeAs of time future. I will now venture to add, that I think I do fee reafon, why we ihould expelt to be itill better and better ferved by there projeas, than by thofe. I mean better upon the whole, in vir-, cue of the reduaion which experience, if experience be worth any thing, ihwld make in the proportion of the number of the ill-grounded and unfuc- cefsful, to that of the well-grounded and fuccefsful ones.

The career of art, the great road which receives the footfieps of pro- jebors, may be confidered as a vait, and perhaps unbounded, plain, be- Brewed with gulphs, fuch as Curtius was lwallowed up. in. Each requires

an

an human viaim to fall into it ere it can cloie, but when it once cbfes, i t clofis to oprn no more, and Ib n~uch of the path is fafe to thofe who fol- low. If the want of perfea informa- tion of former miicarriages renders the reality of human life lefs happy than this piAure, itill the Grnilitude muft. be acknow'edged : and we fee at once the only plain and effeaual method for bringing that fimilitude itill nearer and nearer to perfeEtion ; I mean, the framing the hiitory of the projeCts of tin& pit, and (what may be executed in much greater perfetkion were but a finger. held u p by the hand of govern- ment) the making provifion for re- cording, end colle&ing and publiking as they arc brought forth, the race of thole with which the womb of futuri- t y is ail1 pregnant. But to purfue

this

ihis idea, the execution of which is not within my competence, would lead me too far from the purpofe.

Comfortable it is to refle&, that this flate of continually-improving fecu- ricy, is the natural ftate not only of the road to op.ulence, but of every other track of human life. In the war . which indufiry and ingenuity main- tain with fortune, pait ages of igno- rance and barbarih form the forlorn hope, which has' been detached on ad- vance, and made a iacrifice of for the fake of future. The golden age, it is but too true, is not the lot of the ge- neration in which we live: but, if it is to be found in any part of the track marked out for human exiftence, it will be found, I trufi, not in any part which is paR, but in fome part which i s to come.

But to return to the laws againit ufury,

'172 LETT~XIII. To Dr. Smit6; ufury, apd their refiraining influencu on projeaors. I have made it, I hope,' pretty apparent, that there refiraints have no power or tendency to pick out bad projeas from the good. Is i t worth while to add, which I think I may do with fome truth, that the ten- dency of them is rather to pick the good oyt from the bad ? Thus much at leait may be faid, and it comes to the fame thing, that there is one cafe in which, be the projet9 what i t may, they may have the effea of checking it, and another in which they can have no fuch effe&, and that the firit has for its accompaniment, and that a neceffary one, a circumitance which has a itrong tendency to iiepa- rate and difcard every projet9 of the

' injudicious itarnp, but which is want- ing in the other cafe. I mean, in a word, the ben@ oof d@u@on,

It

I t is cvidcnt enough, that upon a11 fuch proje&s, whatever be their na- ture, as find funds iufficient to carry them on, in thc hands of him whore invention gave them birth, thefe laws are perfealy, and if by this time you will allow me to fay fo, very happily, without power. But for thefe there has not neceffarily been any other judge, prior to experience, than the inventor's own partial affeaion. I t is not only not neceffary that they ihould have had, but it is natural enough that they ihould not have had, any fuch judge: fince in moR cafes the advantage to bc expetled from the projea depends upon the exclufive property in it, and confequently upon the concealment of the princi- ple. Think, on the other hand, .how different is the lot of that cnterptize which depends upon the good opinion

of

r7k LETT.XIII. To Dr. Smith,

of another man, that other, a man pof- f~ITed of the wealth which the projec- tor wants, and before whom neceficy forces him to appear in the charalter of a fuppliant a t lealt : happy if, in the imagination of his judge, ' he adds not to that degrading charalter, that of a vifionary enthufiaft or an impoitsr ! A t any rate, there are, in this csk, two wits, feet to Gft into the merits of the P F O ~ C ~ , fof one, whieh was employed upon that &me taRZ in the other cafe : and of rhefe two there is one, whofe prejudices are certainly hot moit like- ly to be on the favourable fide. True it is, that in the jumble of occurrences, an over-fanguine projeaor may iturn- bk upon a patron as over-fanguinc as h i h l f 5 and the w i k s may bribe the judgment of the one, as they did of the other. The oppofite cafe, how- ever, you -will allow, I think, to be by

1 0 much

on PrBieas in Arts, VC. 175 much the more natural. Whatever a man's w i k s may be for the fucceCs of an enter prize not yet his own, his fears are likely to be itill itronger. That fame pretty generally implanted prin- ciple of vanity and felf-conceit, which difpofes moR of us to over-value each of us his own conceptions, clifpores us, in a proportionable degree, to under- value thofe of other men. .

Is it worth adding, though it be undeniably true, that could it even be proved, by ever fo uncontrovertible evidence, that, from the beginning of time to the prcfcnt day, there never was a projeA that did not terminate in the ruin of its author, not even from fuch a fa& as this could the legiflator derive any fufficient warrant, fo much as for wilhing to fee the fpirir of pro- jeRs in any degree reprefled ?-The difcouraging motto, Sic vos non wbiJ,

may

t 6 LETT. lf111. 5% Dr. Smitb, may be matter of ferious conlideration to the individual, but what is it to the

alegiflator ? W h a t general, let him at- tack with ever ib fuperior an army,

.but ltnows that hundred:, or perhaps thoufands, muit periih at the f i r i t on- f i t ? Shall he, fos that conlideration alone, lie ina&ive in his lines? " Every " mah for hirnfelf-but God," adds the proverb (and it might have added the general, and the legiflator, and all other public fervants), " for us all." Thoie facrifices of individual to gene- ral welfare, which, on To many occa- lions, are made by third peribns againft men's wills, ihall the parties them- ielves be reitrained from making, when they do it of their own choice ? To tic men neck and heels, and throw them into the gulphs I have been {peaking of, is altogether out of the queition : but if at every gulph a Curtius fiands

moun tcd

on Projrtt5 in A r t s , MC. I 77 mounted and caparifoned, ready to take the leap, is it for the legiflator, in afitof old-womanifh tendernefs, to pull him away? Laying even public intereit out of the queftion, and confidering nothing but the feelings of individuals, a legiflator would fcarcely do fo, who knew. the value of hope, "the moft " precious gift of heaven."

Confider, Sir, that it is not with the invention-lottery (that great branch of the projc&-lottery, for the fake of which I am defending the whole, and mufi continue fo to do until you or fomebody elfe can fhew me how to de- fend it on better terms), it is not I fay with the invention-lottery, as with the mine-lottery, the privateering-lot- tery, and fo many other lotteries, which you fpeak of, and in- no infiance, I rhink,very much to their advantage, I n

N thefc

X 78 LETT. XIII. To Dr. Smitb, there lines, fuccefs does not, as in this, arife out of .the embers of ill fuccefs, and thence propagate itfelf, by a happy contagion, perhaps to all eternity. Let Titius have found a mine, it is not the more eafy, but by fo n~uch the lefs eafy, for Sernpronius to find one too : let Titius have made a capture, it is not the more eafy, but by fo much the lefs eafy, for Sempronius to do the like. But let Titius have found aut a

dye, more brilliant or more dara- ble than thofc in uk, let him have in- vented a new and more convenient machine, or a new and more profitable mode of hufbandry, a thoufand dyers, ten thoufand mechanics, a hundred t h w f ~ n d huibandmen, n a y repeat and

. multiply his fuccds : and then, what is it to the public, though the for- .tune d Tiuus, or of hi6 ufurcr,

fiwld

- @ Pr@s &I?F, 2 39

fhoyld have funk under the srpc- rirnent Z

Birmingham aqd Sheffield are pitch? cd upon by you as egamplcs, the orlp of a projpaing; town, the qther of an .upprqje@ing one p. C~qn j r ~ u forgivu my fqying, I rqther wander ' that this gompilrifop of your own choofing, did not fuuggefi Porpe fdpicjons qf the jug tice of tb!: gnrlpepti~ns you had taken up, to the difadvantage of proje&srs, Shrffield i s ap ol$ ~ a k : Ilirrningbam, but a mp@room; What if we ihorrld find the mvihrwm oil1 vqRet: an4 mofe vigorous than che aak ? Not but the one 3s well qs the gther, st what time foever planted, mutt equaliy havq been planted by projettors: for . . . thgw& Tuba1 Cain hirnfelf were to

. _ * p. 1, ch. at rd, i. p. r76, edit.

~ 7 8 4 ,

N o. be

r t o LETT. XI11 be brought polt England to plan Cain himfelf was a in his day, as ever was, or biihop B ham, i t feems, clail lance the title of a the cxclufion of t .

being but of: yefie1 projett fmells freke than elfewhere.

When the o d i ~ word projctler no your ears, the race c tized do not always my. Proje&s, evt o f " dangerous anh C c ments," are repre. to be encouraged, e; ~ o l y be the means.: . is defended in that ill

.an Prqt@s in Arts, @c. I 8 I

larity to other infiances, in which the like means are employed to the like purpofe.

When a company of merchants g c undertake at their own riik and ex- " pence to eitabliih a new trade, with. CC iome remote and barbarous nation, ic " Inay not be unreafonable" (you ob- ierve) c c to incorporate them into a &C joint-fiock company, and to grant " them, in care of theirfuccefs, a mono- " poly ofthe trade for a certain number C L of years. It is the eafieit and moit " natural way, in which the itate can *C recompenfe them, for hazarding a C c dangreous and expenfive experiment,

' " of which the public is afterwards " toreap the benefit. A temporary mo- " nopoly of this kind may be vindi- 6 L cared, ' upon the fame principles, " upon which a like monopoly of a 11' new machine is granted to its in-

. - N 3

CC vehtor,

1 8 i LE*. XIlI. Pb Dr. J)Ritb,

'' ventor, and that of a hew book to its '' autlior;"

private refpeR muR not %p b e M m erilbkacing this uccarion of giv- ing a warnidg, which iS To inuch need- ed tSy manki'nd. If fo d i g i n a l aiid mdepend'kht a fpiiit has riot been al- ways able to L* i t ~ f born txibg d r a m aBde by the f~fcihatioh of founds, intk the paths of vtslgar preju- dice, Kow RiiA a watch 8ooght not

. men of COmm6h mould to fee over rheir judgments, to hvt themfelves fr6m being Itd afiray by Gmilar dc- h h n s ?

1 have fdme'times b e n tempikd to think;thar at* h in the @&er of hws c6 put w&ds under prbfi'cri.ption, as it is K, put &h, the crufe M inventive induftry might perhaps 'dmi've fcatrely kfs a f i h n c e from E Bill artaihder ngainfi the words .pr3jcB anil j3mjeRorss,

than

than it has derived from the a& au- thorizing the grant of patents. I fhould add, however, for a time : for even then the envy, and vanity, and wounded pride, of the uningrnious herd, would fooner or later infufc - their venom into -iome other word, and fct it up as a new tyrant, to hover, like its predeceffo~, over the birth of infant genius, and crufh it in its cra- dle.

Will not you accufe me of puking malice beyond all bounds, if I bring down againfi you CO ufeful and public- fpirired a body of men; as the mem- bers of' the Socictg for the Encwrmgc- , mmt of A s ? I do not, muft not, care : for you command too much re- fpect to have any claim to mercy. At kafi you will .not accufc me of fpiriting up againit you barbarian enemies, and

N 4 devoting

184 LETT. XIII. Ib Dr. Smitb, devoting you to the vengeance of Chc- rokees and Chicafaws.

Of that popular infiitution, the ve- ry profeffed and capital obje&s is the encouragement of projees, and the popagating of that obnoxious breed, the crubing of which you commend as a fit exercife for the arm of pawcr. But if it be right to cruih the aEting malefa&ors, it would be downright in- confiRency not to crulh, at the fame time, or rather .not .to begin with crulhing, there 'their hirers and abet- tors. Thank then their inadvertence, or their generofity, or their prudence, if their beadle has not yet received orders to .burn in .ceremony, as a libel on the fociety, a book that does ho- nour to the age.

After having had the boldnefs to accufc fo grear a rnaiter of having

fallen

.on Projetls in Arts, MC. 1 8 5 *fhllen unawares into an error, may 'l take the itill farther liberty, of fetting conje&ure to work to account for it ? Scarce any man, perhaps ne man; can

pulh the work of creation, in any line, -to fuch a pitch of compleatnefs, as to

have gone through the tafi of cxamin- ing with his own eyes into the grounds .

.of every pofition, without exception, which he has had occafion to employ. 9 o u heard the public voice, itrength- ened by that of law, proclaiming all round you, that ufury was a fad thing, and ufurers a wicked and pernicious fec of men: you heard from one a t leait of thofe quarters, that projetlors were either a foolih and contemptible race, or a knavifh and defirulkive one: Hurried away by .the throng, and tak- ing very naturally for granted, that what every body faid muit have fome

for it, yau have joined the cry, and

886 LETT.XIII; To Dr. Smith, and added your fuffrage to the reR. Ponibip too, among the crowd of pro- +€tors which the lottery ~Coccurrenccs happened to prefent to your obferva- tion, the prejudicial Ibre may have borae tuch a proportion to the bene- ficial, or ihewn rhemfelves in io much itronger colours, as to have given the popular notion r firmer hdd in your judgment, than it would hrve had, had the contrary proportion happened to prefent itfelf to your notice. T o al- low no more weight to examples that fall clok under our eyes, than to thofc which hrve fallen at ever tfo great a diRance-co fuEa the judgment on no. occafion to indulge itfelf in the licence of a too hafty and extenfive generali- tatiran-aot to give any propafitbn footing there, rill after a11 fwh defalca- dons have been made, as art aeoeifary ro reduce ir within the limits of rigid

truth

ttuth-thefe ate I P W ~ , . the cornpleat obd ftrvinte whertof forms the ultimate,. and hithbrto, perbap8 for ever, ideal term of human wKWI-I..

You have c)iefervded egainfi unmerit- ed obloquy two clam sftnen, the orre innocent at fcafi, the other high! y ufe- h1 the fprtaders bf Englih arts in foreign climczll', and thofe who6 in. duRry exerts itfilf in dihibvting that

nrcefiary commedity, which is called by the way of tminehce the Raff of life. May I Bamr mpfelf ~ 8 t h having fuccceded at liSR in my endeavours, to recommend to the fame powerful prote&ion, tW other highly ufeful and equally pe&cuttd icts of men, afurers and projei96rs:-~Ye)s--'I will, for the moment at leaft, indulge fo

flattering

-r88 LETT.XIII. To Dr. Smitb, flattering an idea : and, in purfuance of it, leaving ufurers, for whom I have (aid enough already, I will confider myfelf as joined now with you :in the fame commifion, and thinking with you of the beit means of relieving the projeaor from the.load of difcourage- ment laid on him by thefe laws, in fi far as the preirure of them falls parti- cularly upon him. I n my own view of the matter, indeed, no temperament, no middle courfe, is either neceirary or proper : the only pcrfeCtly effellual, is the on!y perfealy proper remedy,-a fp~lnge. But, as nothing is more com- mbn with mankind, than to give oppo- Gte receptions, to conclufions flowing wi.th equal necefity from the fame principle, let us accommodate our views to that contingency.

According to this idea, the obj&, zs far as confined. to the prefm

cafe,

on Projenj in Arts, MC. I 89 1

cafe, fhould be, to provide, in favour of projeaors only, a difpenfation from the rigour of the anti-ufurious laws : fuch, for infiance, as is-enjoyed by per- ions engaged in the carrying trade, in - virtue of the indulgence given to loans made on the footing of re/pondentia or bottomry. As to abufe, I fee not why the danger of it fhould be greater in his cafe than in thofe.Whether a furn-of mo- ney be embarked, or not embarked, in fuch or fuch a newpmarrufa&ure on land, fhould not, in its own nature, be a fa& much more difficult to afcertain, than whether it be embarked, or not embarked, in fuch or fuch a trading aclvencure by fea : and, in the one cafe as in the other, the payment of the in- tere2, as well as the repayment of the principal, might be made to depend upon the fuccefs of the adventure. To confine the indulgence to new under-

takings,

~zgo LETT, XIII. !Zb Dr. hi tb , - .takings, the ,havirlg obtained a patent for iome invention, and the c ~ n t i p u ~ aqce of the term af the patcnt, might be milde conditions sf the allowenca .given to the bargain : t~ this might be added affidavits, erprefiw of the inp .tended application, and boads, with fureties, conditioned for the per fo~m~ -ance of the intention io declared ; to be regiltered in one of the pafenr~ offices or elrewhere. After this, qfida-? vits once a year, gr ofjeqer, duriog .the fubfiftence of the cpntrak declar- ing what has been dom in eacuti~n

. ofic. If the leading-firing is not yet

thought tight enough, boards of cpn- troul might be infiituted to draw i t

. tighter. Then opens a fccne of verat rion and intrigue-: w a i k of time cmt fumed i.n courting the favour of t h ~ members sf The .bgard: w a h of rime,

in

in opening their undcrRa ed perhaps by ignoran by difdain, and TcIf-fi ,vanity, and pride : th .pride will make it a fi to &ill in the arts of:

datim and cabal, dkvoi merit, and reEukd to ni

-adorned by prsaice wafie of .time -on the 1 :ions thernfelves,engagel

, tinent inquiry: wafte money in .paying them

.of time. All there m ,evils, where the money is public money : how the party's own ! I wil1.1 mor myfelE, with enqu .hall be compofed this to grown gentlemen : .cut the matter ihort, a %at once the Conlmitcees

:a

of Arts. There yon have a body o f ' men ready trained in the conduR of enquiries, which refemble that in queL tion, in every circurnfiance, but that which renders it ridiculous :-the mem- bers or reprefentatives of this demo- cratic body would be as likely, I .take it, to dirchargc .fuch a trufi with fide- lity and fkill, as any ariltocracy that- could be fubitituted in their room,

Cyichof, in W b i c e RuJa,

March 1 7 8 3

L E T T E R S

LETT. I . Introdut7ion.

T HE liberty of bargaining in money-mat- ters, a fpecies of liberty which has never

yet found an advocate, W P. I

Fixing the rate of intereft, being a coercive meafu~e, and an exceprion to the general rule in favour of the e~forcement of con-

traes, it lies upon the advocates of the mca- idre to produce rcafons for it, - P*. 3

Lifi of the reafonr which may be fuppofed to have operated in favour of it, - P* 4

LETT. 11. Rea/onr for Rej2raint.- . I . Prevention o f UJuuty.

, Argument, in favour of the rtitraint. L. Pre- 0 vention.

):

X 94 'LC#~CTL L Bgnce t$ rtJmy. vention of Ufury. Thia beg8 the queG tion, g P* 7

No one rate of intereit 'u naturally more pro- per than mother, - - P. 9

Ne idea d pnrpriety could h u e baon hr&d on thia head but fpr cultom, - ibid.

But the rate indki id by c u h , rarie~ from age to age, and fro? pp!+ to place p. 10

. CuRom, being generated by convenience, evi- denced by confent, lhould fubmit to it ~ p h o o t * C p.12

'No more reafon for bring the price of the sb of money tbm the price of good#, - &d.

-nor fbr lixiag the rate on one fib more than on the othn--uceptiag a we& and dillrnt -6 h

C P* I+

Iaterpo6ng rt ril, to prevent prodigality, i a m a @g to the exihncs of Ikiety, p. 17

-though it may be aJ ~/lr chooiing proper mcthod1, , - 'I - p. 10

Thia not of the number J

I. Beuufo bo~rowiq at oltrmdinup r am U

,.c g ' # % a U a r ' 19s I 'is nqt q natural co.urfe far pmdip!? to

take, - W - p. 18

It is ont of the qlrelion with !egard to,

R. Thofe S , e h o havp mqpv sfthci: ?Y,U, p 19 i. Thok who bavc rtal OX goad Cccurity u

offu, - - ibid.

c. Qr any thing to fell, though it be but 8

wwhgcacy, - - ' - P. 22

a. Thofe who hare no fufficient fecurity . . . to offer, are 'not more likely to get money ~ at an extraordinary, than at tl;e ordinary - rate, - P* 29

What tbcy do get, they ket at the ordinary r ~ c , of their friends, - p* 2.5

3. P~veh t ing tbcir getting wb+t they want at a high'ra&, in the way of borrowing, pre- vcgts 40t t b ~ i r getting it in ihc W+; of taeiog n~ mod8 on crydit, - -i. p. 26

~scluf ion, . tha t the rife& of tbcih Iqwa with

rpg?rd to prodigality, . U ,. fa a s i! bqp eny, is - tp ipcreafc it, -. P* 3 0

The only ciFetcEtua1 check to prodigdity, an in. k d i ~ , ia- undcr thc Roman laoi, - ibid.

0 2 Lrkt .

LETT. IV. ReaJons for Re/raint.-- 3. Protenion tf Indigmce.

T h e advantage it may be of to a man to b o r m money, and the need 'he may bave of it, ad- mitting of an undetermined number. of. degrees, b may the confidcration he pays for it, - - I Pm.33

No legillator can judge, fo well as each indi- vidual for himfelf, whether money is worth to him any thing, and bow much, beyond the ordinary intereit, - P* 37

Repreffion of projeRars.-This fubjeA referred to the letter to Dr. Smith, - ibid.

LETT. V . Rea/ons for Rg?raint.-- 4 . ProtetZon of Simplicity.

No fimplicity fiort of idiotifm can reader an individual 6 bad asjudge in thin cafe u the legillator, - - P* 39

Itwould be to no pnrpofe to prevent a man from being impoRd upon in this way, unlet hc was prevented 'from being impofed upon M purchafer and Sales, - ibid.

C O N T X N ' T S . 197 .A man is not fo liable to impofition in thir way

as in thofe, - - . p . 4s .And in thin way imprudence rdrnitr of 8 re-

medy, which i t doer not'in thok oiherr ; viz. . ',borrowing at k lower rate to pay off the firR loan, - - P- 43

\LETT. V-l. Mycbj f~ of .the anti-ufu- ~rious law^.

Various ways in which the laws againR ufury may do mifchief .;

-1. By precluding many from afihance altoge- ther, - - - P. 45

. .z. Forcing men upon more difrdvantageous ways of obtaining it, - - p. 47

Detriment .fuffcred in 'this way by many dur- ing the war, -L - P* 49

g. Or upon more difadvantageaus terms in the very way forbidden, - - 9. 53

I n as far as the law appears open to cvaton, i t is either nugaory, or elfe mifchievous. ih any one' of thofe three ways, according t o circumRances, - - P. 55

-4. Expofing an ufeful clafs of men to unmerited . Affcri'cring and difgrace, - - p. j 5

6 3 5 . E n c o u ~

8

igB zc*j ii L)cf"rnL% oy IPJ?. 4.8h&1iiig!h& aid proatling h i h e $ , a id

in&ithnde, L P* 59

bifferehcir in this Mpe& betftiren ihe rewards held out to informers in '&is cak, and thofi heid Qt to inforiiiia at large, - p. 60 - II eveh'to red criminals informing againfi ucinnplicn, - . . - ibid.

Caution againfl extending to thde cafes the cenfuk p d e d on this occaiion, - i&d.

LETT. VLI. Eficacy of tbe anti-z$u- rious Laws.

Pofition of Dr. Smith's, that a law attempting to reduce intereR below a certain rate muR be inifficacious, - - p. 62

The pbfiti0~ not warranted by the fa& alledg- . ed in fuppo~t of it, - - P- 6 3

&othing can deftroy the efficacy of fuch n- ffraint in regard to one rate of intereft, that

does not in regard to others, -- p. 65

Why fuch de'RruAioltl would be more apparent with regard to one rate than another, p. 66

Conjedure concerning the real ffate of the fad, in the inffance alluded to by Dr. ~ m h h , T - p. 68

3 T h e

e d i ) . ~ : ~ 6 K ' T ' S r . . tw 'Fhr BbgIii lam OII thds Lead how fLr i)p& to evLFIOn. iL m P 69

RoBirn -lam the& prrW ia&aty oh rh5r bead, - P; 70

Cafes where inteiefi above the ord ina~y rat5 has been taken by w a ~ of the law ;

I . Drawing and ie.drawing, - P. 73

2. Selling bills of exchange a t under price, P* 75

Cafes where it is taken by allowance of t h i . '

law;.

r . P ~ n M i n g , - P. 78

2. Bottomry and refpondentia, - p. 80

Other cdes mork indirt€tly rela8d toufury, ruch as iniirance, buying annuities, BC. p. 82

I i ~laekftone's opinion, the harm of making too bard a baigain ftands on the fimk fddtin'g in tht hire bf a h&il nr of hodey, - I P. 84

0 4 If

200 Letter$ in Dcfnrce of lyury. If to, confiitcncy reqoirer the hbje&ng both

bufineirer tothe fame reltraiatr, - p. , $5

Popular prejudice ha got the length of givimg bad name8 in both cafer. - P. 87

Blackitone's reafoning concerning the money- trade applied to the horfe-trade, - p. 88

Propofal for fixing by law the fame .price for ali horfes. - - - P-. 92

The values of horfea differ not more than the value of money on different occ&ons, p. 93

LETT. X. Grounds of tbe Prgudiccs againJ UJuuty.

Caulks of the difcauntenance hewn to the lender of money at interell;

X. The prevalence of the afceticprinciple amow . Chriftianr, - - P. 96

z. The horror of every thing Jewilh, p. g8

3. Arihtle'r aphorifm about the natural bu- nnnefs of money, - - P. 99

4. T h e motiver, felfim as well as focial, which $ncirr .in rendering the profufe charaller more amiable than the favig , - ,p. ..IQ3

A proof

.C.O.N = B ' N T .S., 204

A proof of this, the unfavourable light in which s money-lenders, and ' other men of thriff, are always reprerented on the Rage, p. 106

Hence, even from legiflators, the lender's inte- reR has met with lefe attention and favour than the borrower's, - P. 107

'-Yet by this partiality the parties meant to be favoured, have .been the gnateft fuf- ferers, - - p. 168

LETT. XI. Co~pound IntereJ.

--Compound interclt, how far difcountenancad by the law, - - p. IIO

I No argument againlt it, but the notion of ufury, or that of hardlhip,. - .p. I r l

1

i fncontfiency and -mirchief. of fuch difcounte- nance, - - ilid.

The cafual inability a of .the borrewer .is a rearon, not .for fuch difcountenance, but

.for a rerpite, which the law never gives, *p. 1%

.Effetts of fuch falfe tenderncfs i n breeding . maLi?Jdt delays, -- -- .P. .I15

. L E ~ ~ T .

*'e Lctm itr DDfbrca of mry.

LE*T. XII. Mtinmam d Gbmt- P-*

Inexpediency of refiraining men in their bargains for money, in the idancc where the' money is wanted for purchafing the .C- b f t m n o f t h e l r ~ , - - P* 117

Such bargains forbidden, by the laws againft maintenance and champcity, - p. 118

Clfe of r gentleman who 108 30001. a J C U by thoG laws, - - P* 1 '9

kbfardity of continuiag laws made to ob- viare a mifchief Of which no trams re- main, - - - p. 121

The abme cab may fervc alfo to evince and - illuhrate the mifchief of the laws rehaining ' the rate ofintnefi, - p. 124

Occahon of this addrefa, - P- 131

The obj& H it, h e defence of p e c - Io& - - - P* 132

Parage,

e o * T & t P $ b w3- PaSge, in brhlch Dr. With appMa of tk . law fiju'ng tbe r i te afhtereft, on accahnhnt of

its tendency to npnR them, - p. i 33

Prejudice under which they labour, - P. 134 - The law, and thmfore the cenfmepafi on them

by the approbation given to that law, admits of no difcrimination in favour of the inno- cent and meritorious, - - p. 136

The projeaor cannot hope for money at the highell rate of. interefi at prefent legal, be- caufe that way always be had with dore

rafety from old-eftablilhed trades, p. 140

The cenfure on projeaors neceffarily invoives the authors i f a l l the arts to which the world owes its profperity, - P- I44

And the laws, the approbation of which m conneaed with that cenfure, man, as far as their influence haa extended, have operated as obltacles to'that prdperity, - p. 145

Another paifage, in which the cenfure paffcd on projeaors is extended to all im-

provers, - P- I47

The cenfurc pail on prqeaors is inconfilt- cnt with fome fundamental ideas tif Dr. Smith, - - - P. 148

Concerning

,Concerning the natural prevalence of p r u d e n a over imprudence--even that which mani feh itfelf in .prodigality--and .the progrefi o f improvement which .ha, been the canfc-

Grounds for not attributing that profperity to the operation - o f . the laws in reitraining

.Great advances in profperity had been made .prior to the earlieit of thofe'laws, p. 154

T h a t their tendency can only hare bee! t o .Icffen the total number of prqjdors , without ltffening the of bad to

good, - P* 'S5 ' T h e greateit mifchief that could have been

done by projetting, i f totally unrcitrained, .could not, according to ,Dr. Smith, war- .rant the interpofition of the law, becaufe. according to him, that done .by prodigals does not warrant that interpofition, p. .l56

'But prodigality is a t any rate much more c n - tainly ruinous, and 'much more common. than projeCting, - - p. 159

t n controuling prodigality the law controuls .pailion by reaion : in controuling proje&s, it .controuls h o w l e d g e by ignorance, 9. ,163

B r.

PJ). Smith condemns this latter interference alfo, in the cenfun he prifer on the law8 which attempt to.dircb.individuda in their private conecrnr, - - p. 165

The argument repeated-that the .ccnEure .on projtAs i n d r e a a11 pail impmu~ment~,p.-167

Bat future proje€ta, aa fach, muit be lefi dan- gerous than the pail ancs were, - p. 168

The only cafe, in which the rdtrrinta applied by there laws to projetts attaches upon them, L that in which they.arc bcR guarded againft hazard, viz. by. the neceffity of their hoing difcuffed before a judge whoie prepofG5on

I is rather on theothcr fide,. - p. 171 l

The ruinof every projettor, without exceptioi, would not be fufficient to difprove the utility

l of proje&r, - P. 172

Of two towns inffanced by Dr. Smith, that which is moit' of a projclting town is .moR p roiperous, - F l79

Akprobation beflowed by Dr. Smith' himfdf on proje€ta, under another name, as alib on other laws that favour them, a warn- ing to guard againfi t i c delufon of

I founds, I - p. 180

Ccniurp

. ., - . 1a6 .Lcttp~~ -in -Josf'~ .of UBvy. Csnfw plrrcd QQ prajeW9 44Ws !P, t4e qi-

, j& thc S~&W of 4r#, - p. t83

. M r b l e grgmnds of. thir cenfun B

:S. Popular opinion, w expreffed by the bad .ienQ corrtrabl by ,the word Prqec- .tor,?D - .I - P. 2 82

. S, Too haQy gencraliition, - p. 186 .Hopes af his turning r@nR h e -current of

. . q q u l u prejudice, in thir iaRonc~groanded a n rheotbors in d c h bq h u done 6, p. r 87

Expedients propofed for taking awry the re- ffraint of the anti-ufltioua Iaws'fram projec- ton only ;

r.!@onds and Admi ts to fecore the applying fie money obtained at extra-intcrelt to this arc, - - P* '90

2. Boards to gcant Qccncca for th?t purpsfe: ex. gr. the Coqro?itqs of tpe So~ictp of Art#, L ibid.

F*jpL:i fp J',

C

P#