Some Considerations of the Lowering of Interest [6]
you fall the Price of your Native Commodities; Or lessen your Trade; Or else prevent not the high Use as you intended. For at the time of lessening your Interest, you want Money for your Trade, or you do not. If you do not, there is no need to prevent Borrowing at a high Rate of your Neighbours. For no Country borrows of its Neighbours but where there is need of Money for Trade: No body will borrow more of a Foreigner to let it lye still. And if you do want Money, Necessity will still make you borrow where you can, and at the Rates your Necessity, not your Laws, shall set: or else, if there be scarcity of Money, it must hinder the Merchant's Buying and Exportation, and the Artisan's Manufacture. Now the kingdom gets or loses by this (for no question the Merchant by low Interest gets all the while) only proportionably (allowing the Consumption of Foreign Commodities to be still the same) as the paying of Use to Foreigners carries away more or less of our Money, than want of Money and stopping our Trade keeps us from bringing in, by hindring our Gains, which can be only estimated by those, who know how much Money we borrow of Foreigners, and at what Rate; and too, what Profit in Trade we make of that Money. Borrowing of Foreigners upon Interest it's true carries away some of our Gain: But yet upon Examination it will be found, that our growing Rich or Poor depends not at all pon our borrowing upon Interest or not; but only which is greater or less, our Importation or Exportation of consumable Commodities. For supposing Two Millions of Money will drive the Trade of England, and that we have Money enough of our own to do it; if we consume of our own Product and Manufacture, and what we Purchase by it of Foreign Commodities, one Million, but of the other Million consume nothing, but make a return of Ten per Cent. per An. we must then every Year be One hundred thousand pounds Richer, and our Stock be so much encreast: But if we Import more consumable Commodities than we Export, our Money must go out to pay for them, and we grow poorer. Suppose therefore ill Husbandry hath brought us to one Million Stock, and we borrow the other Million (as we must, or lose half our Trade) at Six per Cent. If we consume one moyety, and make still Ten per Cent. per An. Return of the other Million, the Kingdom gets Forty thousand pounds per An. though it pay Sixty thousand pound per An. Use. So that if the Merchant's Return be more than his Use, (which 'tis certain it is, or else he will not Trade) and all that is so Traded for on borrowed Money be but the over-ballance of our Exportation to our Importation, the kingdom gets by this Borrowing so much as the Merchant's Gain is above his Use. But if we borrow only for our own Expences, we grow doubly poor, by paying Money for the Commodity we consume, and Use for that Money; though the Merchant gets all this while, by making Returns greater than his Use. And therefore Borrowing of Foreigners in it self makes not the Kingdom rich or poor; for it may do either: But spending more than our Fruits or Manufactures will pay for, brings in Poverty, and Poverty Borrowing. For Money, as necessary to Trade, may be doubly considered. First, as in his Hands that pays the Labourer and Landholder, (for here its motion terminates, and through whose Hands soever it passes between these, he is but a Broker) and if this Man want Money, (as for Example, the Clothier) the Manufacture is not made; and so the Trade stops, and is lost. Or Secondly, Money may be considered as in the Hands of the Consumer, under which Name I here reckon the Merchant who buys the Commodity when made, to Export: And if he want Money, the value of the Commodity when made is lessened, and so the Kingdom loses in the Price. If therefore Use be lessened, and you cannot tye Foreigners to your Terms, then the ill effects fall only upon your Landholders and Artisans: If Foreigners can be forc'd by your Law to Lend you Money only at your own Rate, or not Lend at all, is it not more likely they will rather take it home, and think it safer in their