Chap 26: The American Question

Chap 26: The American Question and Other Politics


  • Smith continued to be a:
    • warm political supporter of the Rockingham Whigs and
    • a warm opponent of the North ministry.
  • This was despite:
    • the patronage he received from Lord North and
    • his friendship with the Duke of Buccleugh and Henry Dundas
  • The first Earl of Minto (then Sir Gilbert Elliot) visited Edinburgh in 1782.
    • He wrote in his journal:
      • “I have found one just man in Gomorrah, Adam Smith, author of the Wealth of Nations.
      • He was the Duke of Buccleugh’s tutor.
      • He is a wise and deep philosopher.
      • He was made Commissioner of the Customs here by the Duke and Lord Advocate.
        • But he is an honest fellow.
  • He wrote a most kind elegant letter to Burke on his resignation.
    • as I believe I told you before, and on my mentioning it to him he told me he was the only man here who spoke out for the Rockinghams.”[322]
    • This letter is now lost.
    • But Burke’s answer to it remains, and was sold at Sotheby’s a few years ago.
  • Smith must have expressed the warmest approval of the step Fox and Burke had taken, on the death of the Marquis of Rockingham in July 1782, in resigning their offices in the Ministry rather than serve under their colleague Lord Shelburne, and
    • He must have felt strongly on the subject to overcome his aversion to letter-writing on the occasion.
  • Fox and Burke have been much censured for their refusal to serve under Shelburne, [Pg 379] inasmuch as that refusal meant a practical disruption of the Whig party; and
    • Burke could not help feeling strengthened, as he says he was in his letter, by the approval of a man like Smith, who was not only a profound political philosopher, but a thorough and loyal Whig.
  • Despite his personal friendship with Lord Shelburne, Smith never seems to have trusted him as a political leader.
    • We have already seen him condemning Shelburne during Shelburne’s first collision with Fox—the “pious fraud” occasion.
    • 19 years later, he shows the same distrust of Shelburne for the same reason.
      • He believed Shelburne was willing to:
        • be subservient to the king’s designs, and
        • increase the Crown’s power which the Whigs aimed to limit.
  • Shelburne’s acceptance of office, after the king’s positive refusal to listen to the views of the Rockinghams themselves regarding the leadership of their own party, was probably regarded by Smith as a piece of open treason to the popular cause, and open espousal of the cause of the Court.


  • In those critical times, the thoughts of even private citizens brooded on war.
  • Charles Mackinnon of Mackinnon was an Edinburgh lawyer who had never been at sea.
    • He was the chief of his clan.
    • He invented the system of naval tactics.
      • It gave Rodney his victories.
      • He was a Highland laird who had spent his days among his herds in Skye.
      • He wrote to Smith about a treatise on fortification,
        • He believed it had very important original discoveries.
        • He sent it to Smith and Henry Mackenzie, with a £5 note to pay for its publication.
    • He fell into adverse circumstances shortly after this letter.
      • He parted with all the old clan property.
    • His treatise on fortification still exists among the manuscripts of the British Museum.
      • It is certainly a poor affair.
      • He reaped only disappointment in it.
    • Smith [Pg 380]seems to have held Mr. Mackinnon personally in high esteem.
      • He strongly dissuades him from giving it to the press in a candid but kind letter:

Dear Sir

  • I received your treatise on the 13th of this month.
  • I must tell you that:
    • it should not go out of the press.
    • I have not yet gone into it.
      • I would again ask whether we should go into it at all.
  • A few days ago, I met with Mr. Mackinzie, who is in the Exchequer Business.
    • He had seen your papers before.
    • He thought with me that in their present condition they would not be proper to publish.
  • We read them over together with great care and attention.
    • We both continued of our first opinion.
  • I hope you will pardon me if I tell you that I cannot find original ideas in them as you mentioned.
  • I do not understand your real message in your former letter.
    • But it seems to me that you feared some person might publish your ideas as his own.
  • I hope there is no danger of this from the character of the gentleman to whom your treatise has been sent.
  • But to prevent the Possibility of the Public being imposed upon in this manner, your Papers now lie sealed up in my writing Desk.
    • They are superscribed with directions to my executors to return them unopened to you or your heirs as their proper owners.
  • In case of the death of me or Mr. M’Kinzie, the production of these papers under my seal and superscribed by my hand will be sufficient to refute any plagiarism of this kind.
    • While we live, our evidence will secure to you the reputation of whatever discoveries may be in them.
  • I return you the £5 note, hoping that you will not insist on this publication, at least for some time.
    • At any rate, I shall always be happy to advance a larger sum on your account, though I wish it was for some other purpose.
  • I have not shown your Papers to Smellie.
  • It will give me great pleasure to:
    • hear from you, and
    • know that you forgive my disagreeable advice.
      • Only my great respect for you [Pg 381] could have extorted it from me.

I ever am, dear sir, most faithfully yours,

Adam Smith.

Custom House, Edinburgh,
August 21, 1782.

If you choose to have your Papers again, I shall send them to you or deliver to whom you please.[323]

  • While Mackinnon was planning to save his country by an improved system of fortification, another was conceiving a grander project of saving her by continental alliances.
    • The moment was among the darkest England has ever passed through.
    • We were engaged in a death-struggle against France, Spain, and the American colonies combined.
    • Cornwallis had just repeated at Yorktown the humiliating surrender of Burgoyne at Saratoga.
    • Elliot lay locked in Gibraltar.
    • Ireland was growing restive and menacing on one side.
    • The Northern powers of Europe on the other—the Armed Neutrality, as they were called—sat and watched, with:
      • their hands on their sword-hilts and
      • a grudge against England in their hearts.
  • Sir John Sinclair believed that these neutral powers held the key of the situation.
    • He wrote a pamphlet in 1782 proposing to translate into their respective tongues:
      • to persuade them to join this country in a crusade against the House of Bourbon, and
      • “to emancipate the colonies in the West Indies and on America for the general interest of all nations.”
  • The price he was prepared to offer these powers for their adhesion was to be a share in:
    • the colonial commerce of England, and
    • the acquisition of some of the French and Spanish colonial dependencies for themselves.
  • Sinclair sent his pamphlet to Smith.
    • He requested for Smith’s opinion on translating it for the conversion of the powers.
  • I have not been able to see this pamphlet.
    • But that it is evidently not the pamphlet entitled “Impartial Considerations on the Propriety of retaining Gibraltar,” as Sinclair’s biographer supposes.
    • For in the former pamphlet Sinclair is advocating a continuance and an extension of the war.
  • Whereas in the latter, he has come round to the advocacy of peace.
    • Instead of contemplating the deprivation of France and Spain of their colonies, he recommends the cession of Gibraltar as a useless and expensive possession.
  • He uses very much the same line of argument which Smith suggests in this letter.
  • Smith’s letter [Pg 382] very probably had some influence in changing his views, though it is true the idea of ceding Gibraltar was in 1782 much favoured by a party in Lord Shelburne’s government, and even by the king himself:


My dear Sir

  • I have read your pamphlet several times with great pleasure.
    • I am very much pleased with the style and composition.
  • I am a little doubtful on its effect if translated on the Powers in the Armed Neutrality.
    • It is too plainly partial to England.
    • It proposes that the Armed Neutrality’s force should be employed in recovering the islands England has lost.
  • Its proposed compensation is that England will give the islands which they may conquer for themselves from France and Spain, England’s assistance.
    • There seems some inconsistency in the argument.
      • If it is just to emancipate America from the dominion of every European power, how can it be just to subject the islands to such dominion?
      • If the monopoly of America’s trade is contrary to the rights of mankind, how can that of the islands be agreeable to these rights?
  • I think that Europe’s public prejudices need most to be set right on the real futility of all distant dominions.
    • Its defence:
      • is most expensive
      • contributes:
        • nothing to the empire’s general defence, by revenue or military forces
        • very little to their own particular defence
  • To defend the barren rock of Gibraltar we have now:
    • left our own coasts defenceless, and
    • sent out a great fleet
      • Any considerable disaster to it may prove fatal to our domestic security.
      • They must probably engage a fleet of superior force.
  • We owe our possession of Gibraltar [Pg 383] to:
    • the union of France and Spain,
    • the important enmity of Spain and
    • the futile and expensive friendship of Portugal
  • Sore eyes have made me delay writing to you so long.

I ever am, my dear sir, your most faithful and affectionate humble servant,

Adam Smith.

Custom House, Edinburgh,
October 14, 1782.[324]

  • The strong opinion expressed in this letter of the uselessness of colonial dependencies, which contributed nothing to the maintenance of the mother country, had of course been already expressed in the Wealth of Nations.
    • “Perish uncontributing colonies” is the very pith of the last sentence of that work.
    • “If any of the provinces of the British Empire cannot be made to contribute towards the support of the whole empire, it is surely time that Great Britain should free herself from the expense of defending those provinces in time of war and of supporting any part of their civil or military establishments in time of peace; and
    • endeavour to accommodate her future views and designs to the real mediocrity of her circumstances.”


  • The principles of free trade presently got an impetus from the conclusion of peace with America and France in 1783.
    • Lord Shelburne wrote Abbé Morellet in 1783.
    • He writes that:
      • the treaties of 1783 were inspired by “the great principle of free trade,” and
      • “a peace was good in the exact proportion that it recognised that principle.”
  • A fitting opportunity was thought to have arisen for making somewhat extended applications of the principle, and
  • Many questions were asked about how far such applications should go in this direction or that.
  • One of Lord Shelburne’s colleagues in the[Pg 384] Ministry was William Eden.
    • When the American Intercourse Bill was before the House in 1783, Eden approached Smith perplexed as to the wisdom of conceding to the new republic free commercial intercourse with this country and our colonies.
    • Eden had already done something for free trade in Ireland.
    • He was presently to earn a name as a great champion of that principle, after successfully negotiating with Dupont de Nemours the Commercial Treaty with France in 1786.
    • But in 1787, he had not accepted the principle so completely as his chief, Lord Shelburne.
    • Perhaps he never took a firm hold of the principle at any time, for Smith always said of him, “He is but a man of detail.”[325]
    • Anyhow, when he wrote Smith in 1783, he was under serious alarm at the proposal to give the United States the same freedom to trade with Canada and Nova Scotia as we enjoyed ourselves.
    • Being so near those colonies, the States would be sure to oust Great Britain and Ireland entirely out of the trade of provisioning them.
    • The Irish fisheries would be ruined, the English carrying trade would be lost.
    • The Americans, with fur at their doors, could easily beat us in hats.
    • If we allowed them to import our tools free, they would beat us in everything else for which they had the raw materials in plenty.
  • Eden and Smith seem to have exchanged several letters on this subject.
    • But none of them remain except the following one from Smith.
    • In this, Smith declares that it would be:
      • an injustice to our own colonies to restrict their trade with the United States merely to benefit Irish fish-curers or English hatters
      • bad policy to impose special discouragements on the trade of one foreign nation which are not imposed on the trade of others.
  • His argument is not for free trade, which he perhaps thought then impracticable, but merely for equality of treatment between:
    • the British subject in Canada and the British subject in England, and
    • the American nation and the Russian, or French, or Spanish.

[Pg 385]

Dear Sir

  • It is certainly just:
    • that their goods, their naval stores for example, should be subjected to the same duties to which we subject those of Russia, Sweden, and Denmark, and
    • that we should treat them as they mean to treat us and all other nations.
  • If the Americans really mean:
    • to subject the goods of all nations to the same duties and
    • to grant them the same indulgence, they set an example of good sense which all other nations should imitate.
  • What degree of commercial connection we should allow between the remaining colonies and the United States may be a more difficult question to some.
    • I think that it should be allowed to go on as before.
    • Whatever inconveniences result from this freedom may be remedied as they occur.
  • The lumber and provisions of the United States are more necessary to our West India Islands than the rum and sugar of the West India Islands are to the United States.
    • Any interruption or restraint of commerce would hurt our loyal subjects much more than our revolted subjects.
  • Canada and Nova Scotia cannot justly be refused at least the same freedom of commerce which we grant to the United States.
  • I suspect the Americans do not mean what they say.
    • I have seen a Revenue Act of South Carolina.
      • 2 shillings are laid on every hundredweight of brown sugar imported from the British plantations
      • Only 18 pence on every hundredweight of brown sugar imported from any foreign colony.
      • 1 penny on every pound of refined sugar from the British plantations
      • 1 halfpenny from any foreign colony.
      • 2-pence on every gallon of French wine
      • 3-pence on every gallon of Spanish wine
      • 4-pence on every gallon of Portuguese wine.
  • I have little anxiety about what becomes of the American commerce.
    • By an equality of treatment of all nations, we must soon open a commerce with the neighbouring nations of Europe infinitely more advantageous than that of so distant a country as America.
  • This is an immense subject upon which when I wrote to you last I intended to have sent you a letter of many sheets.
    • But as I expect to see you in a few weeks I shall not trouble you with so tedious a dissertation.
    • I shall only say at present that every extraordinary encouragement or discouragement given to the trade of any country more than to that of another may be demonstrated to be in every case a complete piece of dupery
    • The state’s interest is constantly sacrificed to the interest of some particular class of traders.
  • I heartily congratulate you on success of the East India Bill in the Lower House.[Pg 386]
    • I have no doubt that it will pass through the Upper House.
  • The decisive judgment and resolution with which Mr. Fox has introduced and supported that Bill does him the highest honour.

I ever am, with the greatest respect and esteem, dear sir, your most affectionate and most humble servant,

Adam Smith.

Edinburgh, December 15, 1783.[326]

  • Smith expresses unqualified commendation for Fox’s East India Bill.
    • It proposed to transfer the government of British India from the Court of Directors of the East India Company to a new board of Crown nominees.
  • This measure was entirely to Smith’s mind.
    • In the former editions of his book, he had already condemned the company as it “oppresses and domineers in India”
    • Immediately before this bill was introduced, he wrote about the company that “no other sovereigns ever were, or ever could be, so perfectly indifferent about:
      • their subjects’ happiness or misery,
      • the improvement or waste of their dominions,
      • their administration’s glory or disgrace,
        • From irresistible moral causes, most of the proprietors of such a mercantile company are and necessarily must be so.”



[322] Lady Minto’s Life of the Earl of Minto, i. 84.

[323] Add. MSS., 5035.

[324]Correspondence of Sir John Sinclair, i. 389.

[325] Mackintosh, Miscellaneous Works, iii. 17.

[326]Journals and Correspondence of Lord Auckland, i. 64



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