the bounty could ever contribute to lower the price of grain。
In years of plenty； it has already been observed； the
bounty； by occasioning an extraordinary exportation； necessarily
keeps up the price of corn in the home market above what it would
naturally fall to。 To do so was the avowed purpose of the
institution。 In years of scarcity； though the bounty is
frequently suspended； yet the great exportation which it
occasions in years of plenty must frequently hinder more or less
the plenty of one year from relieving the scarcity of another。
Both in years of plenty and in years of scarcity； therefore； the
bounty necessarily tends to raise the money price of corn
somewhat higher than it otherwise would be in the home market。
That； in the actual state of tillage； the bounty must
necessarily have this tendency will not； I apprehend； be disputed
by any reasonable person。 But it has been thought by many people
that it tends to encourage tillage； and that in two different
ways； first； by opening a more extensive foreign market to the
corn of the farmer； it tends； they imagine； to increase the
demand for； and consequently the production of that commodity；
and secondly； by securing to him a better price than he could
otherwise expect in the actual state of tillage； it tends； they
suppose； to encourage tillage。 This double encouragement must；
they imagine； in a long period of years； occasion such an
increase in the production of corn as may lower its price in the
home market much more than the bounty can raise it； in the actual
state which tillage may； at the end of that period； happen to be
in。
I answer； that whatever extension of the foreign market can
be occasioned by the bounty must； in every particular year； be
altogether at the expense of the home market； as every bushel of
corn which is exported by means of the bounty； and which would
not have been exported without the bounty； would have remained in
the home market to increase the consumption and to lower the
price of that commodity。 The corn bounty； it is to be observed；
as well as every other bounty upon exportation； imposes two
different taxes upon the people； first； the tax which they are
obliged to contribute in order to pay the bounty； and secondly；
the tax which arises from the advanced price of the commodity in
the home market； and which； as the whole body of the people are
purchasers of corn； must； in this particular commodity； be paid
by the whole body of the people。 In this particular commodity；
therefore； this second tax is by much the heavier of the two。 Let
us suppose that； taking one year with another； the bounty of five
shillings upon the exportation of the quarter of wheat raises the
price of that commodity in the home market only sixpence the
bushel； or four shillings the quarter； higher than it otherwise
would have been in the actual state of the crop。 Even upon this
very moderate supposition； the great body of the people； over and
above contributing the tax which pays the bounty of five
shillings upon every quarter of wheat exported； must pay another
of four shillings upon every quarter which they themselves
consume。 But； according to the very well informed author of the
tracts upon the corn trade； the average proportion of the corn
exported to that consumed at home is not more than that of one to
thirty…one。 For every five shillings； therefore； which they
contribute to the payment of the first tax； they must contribute
six pounds four shillings to the payment of the second。 So very
heavy a tax upon the first necessary of life must either reduce
the subsistence of the labouring poor； or it must occasion some
augmentation in their pecuniary wages proportionable to that in
the pecuniary price of their subsistence。 So far as it operates
in the one way； it must reduce the ability of the labouring poor
to educate and bring up their children； and must； so far； tend to
restrain the population of the country。 So far as it operates in
the other； it must reduce the ability of the employers of the
poor to employ so great a number as they otherwise might do； and
must； so far； tend to restrain the industry of the country。 The
extraordinary exportation of corn； therefore； occasioned by the
bounty； not only； in every particular year； diminishes the home；
just as much as it extends the foreign； market and consumption；
but； by restraining the population and industry of the country；
its final tendency is to stunt and restrain the gradual extension
of the home market； and thereby； in the long run； rather to
diminish； than to augment； the whole market and consumption of
corn。
This enhancement of the money price of corn； however； it has
been thought； by rendering that commodity more profitable to the
farmer； must necessarily encourage its production。
I answer； that this might be the case if the effect of the
bounty was to raise the real price of corn； or to enable the
farmer； with an equal quantity of it； to maintain a greater
number of labourers in the same manner； whether liberal；
moderate； or scanty； that other labourers are commonly maintained
in his neighbourhood。 But neither the bounty； it is evident； nor
any other human institution can have any such effect。 It is not
the real； but the nominal price of corn； which can in any
considerable degree be affected by the bounty。 And though the tax
which that institution imposes upon the whole body of the people
may be very burdensome to those who pay it； it is of very little
advantage to those who receive it。
The real effect of the bounty is not so much to raise the
real value of corn as to degrade the real value of silver； or to
make an equal quantity of it exchange for a smaller quantity； not
only of corn； but of all other homemade commodities： for the
money price of corn regulates that of all other home…made
commodities。
It regulates the money price of labour； which must always be
such as to enable the labourer to purchase a quantity of corn
sufficient to maintain him and his family either in the liberal；
moderate； or scanty manner in which the advancing； stationary； or
declining circumstances of the society oblige his employers to
maintain him。
It regulates the money price of all the other parts of the
rude produce of land； which； in every period of improvement； must
bear a certain proportion to that of corn； though this proportion
is different in different periods。 It regulates； for example； the
money price of grass and hay； of butcher's meat； of horses； and
the maintenance of horses； of land carriage consequently； or of
the greater part of the inland commerce of the country。
By regulating the money price of all the other parts of the
rude produce of land； it regulates that of the materials of
almost all manufactures。 By regulating the money price of labour；
it regulates that of manufacturing art and industry。 And by
regulating both； it regulates that of the complete manufacture。
The money price of labour； and of everything that is the produce
either of land or labour； must necessarily either rise or fall in
proportion to the money price of corn。
Though in consequence of the bounty； therefore； the farmer
should be enabled to sell his corn for four shillings a bushel
instead of three…and…sixpence； and to pay his landlord a money
rent proportionable to this rise in the money price of his
produce； yet if； in consequence of this rise in the price of
corn； four shillings will purchase no more homemade goods of any
other kind than three…and…sixpence would have done before；
neither the circumstances of the farmer nor those of the landlord
will be much mended by this change。 The farmer will not be able
to cultivate much better： the landlord will not be able to live
much better。 In the purchase of foreign commodities this
enhancement in the price of corn may give them some little
advantage。 In that of home…made commodities it can give them none
at all。 And almost the whole expense of the farmer； and the far
greater part even of that of the landlord； is in homemade
commodities。
That degradation in the value of silver which is the effect
of the fertility of the mines； and which operates equally； or
very near equally； through the greater part of the commercial
world； is a matter of very little consequence to any particular
country。 The consequent rise of all money prices； though it does
not make those who receive them really richer； does make them
really poorer。 A service of plate becomes really cheaper； and
everything else remains precisely of the same real value as
before。
But that degradation in the value of silver which； being the
effect either of the peculiar situation or of the political
institutions of a particular country； takes place only in that
country； is a matter of very great consequence； which； far from
tending to make anybody really richer； tends to make everybody
really poorer。 The rise in the money price of all commodities；
which is in this case peculiar to that country； tends to
discourage more or less every sort of industry which is carried
on within it； and to enable foreign nations； by furnishing almost
all sorts of goods for a smaller quantity of silver than its own
workmen can afford to do； to undersell them； not only in the
foreign； but even in the home market。
It is the peculiar situation of Spain and Portugal as
proprietors of the mines to be the distributors of gold and
silver to all the other countries of Europe。 Those metals ought
naturally； therefore； to be somewhat cheaper in Spain and
Portugal than in any other part of Europe。 The difference；
however； should be no more than the amount of the freight and
insurance； and； on account of the great value and small bulk of
those metals； their freight is no great matter； and their
insurance is the same as that of any other goods of equal value。
Spain and Portugal； therefore； could suffer very little from
their peculiar situation； if they did not aggravate its
disadvantages by their political in