Alexander Hamilton

REPORT ON MANUFACTURES

DECEMBER 5, 1791

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Communicatedto the House of Representatives, December 5, 1791

[To the Speaker of the House ofRepresentatives:]

The Secretary of the Treasury in obedienceto the order of the House of Representatives, of the 15th day of January 1790,has applied his attention, at as early a period as his other duties wouldpermit, to the subject of Manufactures; and particularly to the means ofpromoting such as will tend to render the United States, independent on foreignnations, for military and other essential supplies. And he thereuponrespectfully submits the following Report:

The expediency of encouraging manufacturesin the United States, which was not long since deemed very questionable,appears at this time to be pretty generally admitted. The embarrassments, whichhave obstructed the progress of our external trade, {193} have led to seriousreflections on the necessity of enlarging the sphere of our domestic commerce:the restrictive regulations, which in foreign markets abridge the vent of theincreasing surplus of our Agricultural produce, serve to beget an earnestdesire, that a more extensive demand for that surplus may be created at home:And the complete success, which has rewarded manufacturing enterprise, in somevaluable branches, conspiring with the promising symptoms, which attend someless mature essays, in others, justify a hope, that the obstacles to the growthof this species of industry are less formidable than they were (972) apprehendedto be; and that it is not difficult to find, in its further extension; a fullindemnification for any external disadvantages, which are or may beexperienced, as well as an accession of resources, favourable to nationalindependence and safety.

There still are, nevertheless, respectablepatrons of opinions, unfriendly to the encouragement of manufactures. Thefollowing are, substantially, the arguments, by which these opinions aredefended.

“In every country (say those who entertainthem) Agriculture is the most beneficial and productive object of human industry. This position, generally, ifnot universally true, applies with peculiar emphasis to the United States, onaccount of their immense tracts of fertile territory, uninhabited andunimproved. Nothing can afford so [279] advantageous anemployment for capital and labour, as the conversion of this extensive wildernessinto cultivated farms. Nothing equally with this, can contribute to thepopulation, strength and real riches of the country."

"To endeavor by the extraordinarypatronage of Government, to accelerate the growth of manufactures, is in fact,to endeavor, by force and art, to transfer the natural current of industry,from a more, to a less beneficial channel. Whatever has such a tendency mustnecessarily be unwise. Indeed it can hardly ever be wise in a government, toattempt to give a direction to the industry of its citizens. This under thequick-sighted guidance of private interest, will, if left to itself, infalliblyfind its own way to the most profitable employment; and it is by {194} suchemployment, that the public prosperity will be most effectually promoted. Toleave industry to itself, therefore, is, in almost every case, the soundest aswell as the simplest policy.”

“This policy is not only recommended tothe United States, by considerations which affect all nations, it is, in amanner, dictated to them by the imperious force of a very peculiar situation.The smallness of their population compared with their territory -- the constantallurements to emigration from the settled to the unsettled parts of thecountry -- the facility, with which the less independent condition of anartisan can be exchanged for the more independent condition of a farmer, theseand similar causes conspire to produce, and for a length of time must continueto occasion, a scarcity of hands for manufacturing occupation, and dearness oflabor generally. To these disadvantages for the prosecution of manufactures, adeficiency of pecuniary capital being added, the prospect of a successfulcompetition with the manufactures of Europe must be regarded as little lessthan desperate. Extensive manufactures can only be the offspring of aredundant, at least of a full population. Till the latter shall characterisethe situation of this country, 'tis vain to hope for the former.”

“If contrary to the natural course ofthings, an unseasonable and premature spring can be given to certain fabrics,by heavy duties, prohibitions, bounties, or by other forced expedients; thiswill only be to sacrifice the interests of the community (973) to thoseof particular classes. Besides the misdirection of labour, a virtual monopolywill be given to the persons employed on such fabrics; and an enhancement ofprice, the inevitable consequence of every monopoly, must be defrayed at theexpence of the other parts of the society. It is far preferable, that thosepersons should be engaged in the cultivation of the earth, and that we shouldprocure, in exchange for its productions, the commodities, with whichforeigners are able to supply us in greater perfection, and upon betterterms.” [280]

This mode of reasoning is founded uponfacts and principles, which have certainly respectable pretensions. If it hadgoverned the conduct of nations, more generally than it has done, there {195}is room to suppose, that it might have carried them faster to prosperity andgreatness, than they have attained, by the pursuit of maxims too widelyopposite. Most general theories, however, admit of numerous exceptions, andthere are few, if any, of the political kind, which do not blend a considerableportion of error, with the truths they inculcate.

In order to an accurate judgement how farthat which has been just stated ought to be deemed liable to a similarimputation, it is necessary to advert carefully to the considerations, whichplead in favour of manufactures, and which appear to recommend the special andpositive encouragement of them; in certain cases, and under certain reasonablelimitations.

It ought readily to be conceded, that thecultivation of the earth as the primary and most certain source of nationalsupply -- as the immediate and chief source of subsistence to man -- as theprincipal source of those materials which constitute the nutriment of otherkinds of labor -- as including a state most favourable to the freedom andindependence of the human mind -- one, perhaps, most conducive to themultiplication of the human species -- has intrinsicallya strong claim to pre-eminence overevery other kind of industry.

But, that it has a title to any thing likean exclusive predilection, in any country, ought to be admitted with greatcaution. That it is even more productive than every other branch of Industryrequires more evidence, than has yet been given in support of the position.That its real interests, precious and important as without the help ofexaggeration, they truly are, will be advanced, rather than injured by the dueencouragement of manufactures, may, it is believed, be satisfactorilydemonstrated. And it is also believed that the expediency of such encouragementin a general view may be shewn to be recommended by the most cogent andpersuasive motives of national policy.

It has been maintained, that Agricultureis, not only, the most productive, but the only productive species of industry.The reality of this suggestion in either aspect, has, however, not beenverified by any accurate detail of facts and calculations; and the generalarguments, which are adduced to prove it, are rather subtil and paradoxical,than solid or convincing. {196}

Those which maintain its exclusiveproductiveness are to this effect: (974)

Labour, bestowed upon the cultivationof land produces enough, [281] notonly to replace all the necessary expences incurred in the business, and tomaintain the persons who are employed in it, but to afford together with the ordinary profit on the stock or capitalof the Farmer, a nett surplus, or rent for the landlord or proprietor of thesoil. But the labor of Artificers does nothing more, than replace the Stockwhich employs them (or which furnishes materials tools and wages) and yield theordinary profit upon that Stock. Ityields nothing equivalent to the rent ofland. Neither does it add any thing to the totalvalue of the whole annual produce of the land and labour of the country. Theadditional value given to those parts of the produce of land, which are wroughtinto manufactures, is counter-balanced by the value of those other parts ofthat produce, which are consumed by the manufacturers. It can therefore only beby saving, or parsimony not by thepositive productiveness of theirlabour, that the classes of Artificers can in any degree augment the revenue ofthe Society.

To this it has been answered --

1 “That inasmuch as it is acknowledged,that manufacturing labour reproduces a value equal to that which is expended orconsumed in carrying it on, and continues in existence the original Stock orcapital employed -- it ought on that account alone, to escape being consideredas wholly unproductive: That though it should be admitted, as alleged, that theconsumption of the produce of the soil, by the classes of Artificers orManufacturers, is exactly equal to the value added by their labour to thematerials upon which it is exerted; yet it would not thence follow, that itadded nothing to the Revenue of the Society, or to the aggregate value of theannual produce of its land and labour. If the consumption for any given periodamounted to a given sum and the increased value of the producemanufactured, in the same period, to a likesum, the total amount of the consumption and production during that period,would be equal to the two sums, andconsequently double the value of the agricultural {197}produce consumed. Andthough the increment of value produced by the classes of Artificers should atno time exceed the value of the produce of the land consumed by them, yet therewould be at every moment, in consequence of their labour, a greater value ofgoods in the market than would exist independent of it.”

2 -- “That the position, that Artificerscan augment the revenue of a Society, only by parsimony, is true, in no othersense, than in one, which is equally applicable to Husbandmen or Cultivators.It may be alike affirmed of all these classes, that the fund acquired by theirlabor and destined for their support is not, in an ordinary way, more thanequal to it. And hence it will follow, that augmentations of the wealth orcapital of the community (except in the instances of some extraordinary [282] dexterity or skill can only proceed, with respect toany of them, from the savings of the more thrifty and parsimonious."

3 -- “That the annual produce of the landand labour of a country can only be encreased, in two ways -- by someimprovement in the productive (975) powers of the useful labour, which actually exists within it, or bysome increase in the quantity of such labour: That with regard to the first,the labour of Artificers being capable of greater subdivision and simplicity ofoperation, than that of Cultivators, it is susceptible, in a proportionablygreater degree, of improvement in its productivepowers, whether to be derived from an accession of Skill, or from theapplication of ingenious machinery; in which particular, therefore, the labouremployed in the culture of land can pretend to no advantage over that engagedin manufactures: That with regard to an augmentation of the quantity of usefullabour, this, excluding adventitious circumstances, must depend essentiallyupon an increase of capital, whichagain must depend upon the savings made out of the revenues of those, whofurnish or manage that, which is atany time employed, whether in Agriculture, or in Manufactures, or in any otherway.”

But while the exclusive productiveness of Agricultural labour has been thusdenied and refuted, the superiority of its productiveness has been concededwithout hesitation. As this concession {198} involves a point of considerablemagnitude, in relation to maxims of public administration, the grounds on whichit rests are worthy of a distinct and particular examination.

One of the arguments made use of, in supportof the idea may be pronounced both quaint and superficial. It amounts to this-- That in the productions of the soil, nature co-operates with man; and thatthe effect of their joint labour must be greater than that of the labour of manalone.

This however, is far from being anecessary inference. It is very conceivable, that the labor of man alone laidout upon a work, requiring great skill and art to bring it to perfection, maybe more productive, in value, thanthe labour of nature and man combined, when directed towards more simpleoperations and objects: And when it is recollected to what an extent the Agencyof nature, in the application of the mechanical powers, is made auxiliary tothe prosecution of manufactures, the suggestion, which has been noticed, loseseven the appearance of plausibility.

It might also be observed, with a contraryview, that the labour employed in Agriculture is in a great measure periodicaland occasional, depending on seasons, liable to various and long intermissions;while that occupied in many manufactures is constant and [283] regular, extending through the year, embracing in someinstances night as well as day. It is also probable, that there are among thecultivators of land more examples of remissness, than among artificers. Thefarmer, from the peculiar fertility of his land, or some other favorablecircumstance, may frequently obtain a livelihood, even with a considerabledegree of carelessness in the mode of cultivation; but the artisan can withdifficulty effect the same object, without exerting himself pretty equally withall those, who are engaged in the same pursuit. And if it may likewise beassumed as a fact, that manufactures open a wider field to exertions ofingenuity than agriculture, it would not be a strained (976) conjecture,that the labour employed in the former, being at once more constant, more uniform and more ingenious, than that which isemployed in the latter, will be found at the same time more productive. {199}

But it is not meant to lay stress onobservations of this nature they ought only to serve as a counterbalance tothose of a similar complexion. Circumstances so vague and general, as well asso abstract, can afford little instruction in a matter of this kind.

Another, and that which seems to be theprincipal argument offered for the superior productiveness of Agriculturallabour, turns upon the allegation, that labour employed in manufactures yieldsnothing equivalent to the rent of land; or to that nett surplus, as it iscalled, which accrues to the proprietor of the soil.

But this distinction, important as it hasbeen deemed, appears rather verbal than substantial.

It is easily discernible, that what in thefirst instance is divided into two parts under the denominations of the ordinary profit of the Stock of thefarmer and rent to the landlord, isin the second instance united under the general appellation of the ordinary profit on the Stock of theUndertaker; and that this formal or verbal distribution constitutes the wholedifference in the two cases. It seems to have been overlooked, that the land isitself a Stock or capital, advanced or lent by its owner to the occupier ortenant, and that the rent he receives is only the ordinary profit of a certain Stockin land, not managed by the proprietor himself, but by another to whom he lendsor lets it, and who on his part advances a second capital to stock &improve the land, upon which he also receives the usual profit. The rent of thelandlord and the profit of the farmer are therefore nothing more than the ordinary profits of two capitalsbelonging to two different persons,and united in the cultivation of a farm: As in the other case, the surpluswhich arises upon any manufactory, after replacing the expences of carrying iton, answers to the ordinary profits of oneor more capitals engaged in the prosecution of such manufactory. It is saidone [284] or more capitals; because in fact, the same thing which iscontemplated, in the case of the farm, sometimes happens in that of amanufactory. There is one, who furnishes a part of the capital, or lends a partof the money, by which it is carried on, and another, who carries {200} it onwith the addition of his own capital. Out of the surplus, which remains, afterdefraying expences, an interest is paid to the money lender for the portion ofthe capital furnished by him, which exactly agrees with the rent paid to thelandlord; and the residue of that surplus constitutes the profit of theundertaker or manufacturer, and agrees with what is denominated the ordinaryprofits on the Stock of the farmer. Both together make the ordinary profits oftwo capitals [employed in a manufactory; as in the other case the rent of thelandlord and the revenue of the farmer compose the ordinary profits of twoCapitals] employed in the cultivation of a farm.

The rent therefore accruing to theproprietor of the land, far from being a criterion of exclusive productiveness, as has been argued, is no criterion evenof superior (977) productiveness. The question must still be, whetherthe surplus, after defraying expences, of a givencapital, employed in the purchase andimprovement of a piece of land, is greater or less, than that of a likecapital employed in the prosecution of a manufactory: or whether the whole value produced from a given capital and a given quantity of labour, employed in one way, be greater or less,than the whole value produced from anequal capital and an equal quantity of labour employed in the other way: or rather, perhaps whether thebusiness of Agriculture or that of Manufactures will yield the greatestproduct, according to a compound ratio ofthe quantity of the Capital and the quantity of labour, which are employed inthe one or in the other.

The solution of either of these questionsis not easy; it involves numerous and complicated details, depending on anaccurate knowledge of the objects to be compared. It is not known that thecomparison has ever yet been made upon sufficient data properly ascertained andanalised. To be able to make it on the present occasion with satisfactoryprecision would demand more previous enquiry and investigation, than there hasbeen hitherto either leisure or opportunity to accomplish.

Some essays however have been made towardsacquiring the requisite information; which have rather served to throw doubtupon, than to confirm the Hypothesis, under examination: But {201} it ought tobe acknowledged, that they have been too little diversified, and are tooimperfect, to authorise a definitive conclusion either way; leading rather toprobable conjecture than to certain deduction. They render it probable, thatthere are various branches of manufactures, in which [285] a givenCapital will yield a greater total product,and a considerably greater nett product, than an equal capital invested in thepurchase and improvement of lands; and that there are also some branches, in which both the gross and the nett produce will exceed that of Agriculturalindustry; according to a compound ratio of capital and labour: But it is onthis last point, that there appears to be the greatest room for doubt. It isfar less difficult to infer generally, that the nett produce of Capital engaged in manufacturing enterprises isgreater than that of Capital engaged in Agriculture.

In stating these results, the purchase andimprovement of lands, under previous cultivation are alone contemplated. Thecomparison is more in favour of Agriculture, when it is made with reference tothe settlement of new and waste lands; but an argument drawn from so temporarya circumstance could have no weight in determining the general questionconcerning the permanent relative productiveness of the two species ofindustry. How far it ought to influence the policy of the United States, on thescore of particular situation, will be adverted to in another place.

The foregoing suggestions are not designed to inculcate an opinion that manufacturing industry is moreproductive than that of Agriculture. They are intended rather to shew thatthe reverse of this proposition is not ascertained; that the general argumentswhich are brought to establish it are not satisfactory; and consequently that asupposition of the superior productiveness of Tillage ought to be no obstacleto listening to any substantial inducements to the encouragement ofmanufactures, which may be otherwise perceived to exist, through anapprehension, that they may have a tendency to divert labour from a more to aless profitable employment.

It is extremely probable, that on a fulland accurate devellopment of the matter, on the ground of fact and calculation,it would be discovered that there is no material difference between theaggregate productiveness of the one, and (978) of the other kind ofindustry; and that the propriety of the encouragements, which may in any casebe proposed to be given to either ought to be determined upon considerationsirrelative to any comparison of that nature.

II Butwithout contending for the superior productiveness of Manufacturing Industry,it may conduce to a better judgment of the policy, which ought to be pursuedrespecting its encouragement, {202} to contemplate the subject, under someadditional aspects, tending not only to confirm the idea, that this kind ofindustry has been improperly represented as unproductive in itself; but [to]evince in addition that the establishment and diffusion of manufactures havethe effect of rendering the total mass of useful and productive labor in acommunity, [286] greaterthan it would otherwise be. In prosecuting this discussion, it may benecessary briefly to resume and review some of the topics, which have beenalready touched.

To affirm, that the labour of theManufacturer is unproductive, because he consumes as much of the produce ofland, as he adds value to the raw materials which he manufactures, is notbetter founded, than it would be to affirm, that the labour of the farmer,which furnishes materials to the manufacturer, is unproductive, because he consumes an equal value ofmanufactured articles. Each furnishes a certain portion of the produce ofhis labor to the other, and each destroys a correspondent portion of theproduce of the labour of the other. In the mean time, the maintenance of twoCitizens, instead of one, is going on; the State has two members instead ofone; and they together consume twice the value of what is produced from theland.

If instead of a farmer and artificer,there were a farmer only, he would be under the necessity of devoting a part ofhis labour to the fabrication of cloathing and other articles, which he wouldprocure of the artificer, in the case of there being such a person; and ofcourse he would be able to devote less labor to the cultivation of his farm;and would draw from it a proportionably less product. The whole quantity ofproduction, in this state of things, in provisions, raw materials andmanufactures, would certainly not exceed in value the amount of what would beproduced in provisions and raw materials only, if there were an artificer aswell as a farmer.

Again -- if there were both an artificerand a farmer, the latter would be left at liberty to pursue exclusively thecultivation of his farm. A greater quantity of provisions and raw materials wouldof course be produced -- equal at least -- as has been already observed, to thewhole amount of the provisions, raw materials {203} and manufactures, whichwould exist on a contrary supposition. The artificer, at the same time would begoing on in the production of manufactured commodities; to an amount sufficientnot only to repay the farmer, in those commodities, for the provisions andmaterials which were procured from him, but to furnish the Artificer himselfwith a supply of similar commodities for his own use. Thus then, there would betwo quantities or values in existence, instead of one; and the revenue andconsumption (979) would be double in one case, what it would be in theother.

If in place of both these suppositions,there were supposed to be two farmers, and no artificer, each of whom applied apart of his labour to the culture of land, and another part to the fabricationof Manufactures -- in this case, the portion of the labour of both bestowedupon land would produce the same quantity of provisions [287] and raw materials only, as would be produced by the intiresum of the labour of one applied in the same manner, and the portion of thelabour of both bestowed upon manufactures, would produce the same quantity ofmanufactures only, as would be produced by the intire sum of the labour of oneapplied in the same manner. Hence the produce of the labour of the two farmerswould not be greater than the produce of the labour of the farmer andartificer; and hence, it results, that the labour of the artificer is aspossitively productive as that of the farmer, and, as positively, augments therevenue of the Society.

The labour of the Artificer replaces tothe farmer that portion of his labour, with which he provides the materials ofexchange with the Artificer, and which he would otherwise have been compelledto apply to manufactures: and while the Artificer thus enables the farmer toenlarge his stock of Agricultural industry, a portion of which he purchases forhis own use, he also supplies himselfwith the manufactured articles ofwhich he stands in need. Hedoes still more -- Besides this equivalent which he gives for the portion ofAgricultural labour consumed by him, and this supply of manufacturedcommodities for his own consumption -- he furnishes still a surplus, whichcompensates for the use of the Capital advanced either by himself or some otherperson, for carrying on the business. This is the ordinary profit of the {204}stock employed in the manufactory, and is, in every sense, as effective anaddition to the income of the Society, as the rent of land.

The produce of the labour of the Artificerconsequently, may be regarded as composed of three parts; one by which theprovisions for his subsistence and the materials for his work are purchased ofthe farmer, one by which he supplies himself with manufactured necessaries, anda third which constitutes the profit on the Stock employed. The two lastportions seem to have been overlooked in the system, which represents manufacturingindustry as barren and unproductive.

In the course of the precedingillustrations, the products of equal quantities of the labour of the farmer andartificer have been treated as if equal to each other. But this is not to be understoodas intending to assert any such precise equality. It is merely a manner ofexpression adopted for the sake of simplicity and perspicuity. Whether thevalue of the produce of the labour of the farmer be somewhat more or less, thanthat of the artificer, is not material to the main scope of the argument, whichhitherto has only aimed at shewing, that the one, as well as the other,occasions a possitive augmentation of the total produce and revenue of theSociety.

[288]{204} (980) It is nowproper to proceed a step further, and to enumerate the principal circumstances,from which it may be inferred -- That manufacturing establishments not onlyoccasion a possitive augmentation of the Produce and Revenue of the Society,but that they contribute essentially to rendering them greater than they couldpossibly be, without such establishments. These circumstances are --

1. The division of Labour.

2. An extension of the use of Machinery.

3. Additional employment to classes of thecommunity not ordinarily engaged in the business.

4. The promoting of emigration fromforeign Countries.

5. The furnishing greater scope for thediversity of talents and dispositions which discriminate men from each other.

6. The affording a more ample and variousfield for enterprise. {205}

7. The creating in some instances a new,and securing in all, a more certain and steady demand for the surplus produceof the soil.

Each of these circumstances has aconsiderable influence upon the total mass of industrious effort in acommunity. Together, they add to it a degree of energy and effect, which arenot easily conceived. Some comments upon each of them, in the order in whichthey have been stated, may serve to explain their importance.

1. As to theDivision of Labour.

It has justly been observed, that there isscarcely any thing of greater moment in the economy of a nation, than theproper division of labour. The separation of occupations causes each to becarried to a much greater perfection, than it could possible acquire, if theywere blended. This arises principally from three circumstances.

lst -- The greater skill and dexteritynaturally resulting from a constant and undivided application to a singleobject. It is evident, that these properties must increase, in proportion tothe separation and simplification of objects and the steadiness of theattention devoted to each; and must be less, in proportion to the complicationof objects, and the number among which the attention is distracted.

2nd. The economy of time -- by avoiding the loss of it, incident to afrequent transition from one operation to another of a different nature. Thisdepends on various circumstances -- the transition itself -- the orderlydisposition of the impliments, machines and materials employed in the operationto be relinquished -- the preparatory steps to the commencement of a new one --the interruption of the impulse, which the mind of the workman acquires, frombeing engaged in a particular operation -- the distractions hesitations andreluctances, [289] which attend the passage from one kindof business to another.

3rd. An extension of the use of Machinery.A man occupied on a single object will have it more in his power, and will bemore naturally led to exert his imagination in devising methods {206}tofacilitate and abrige labour, than if he were perplexed by a variety ofindependent and dissimilar opera- (981) tions. Besides this, thefabrication of Machines, in numerous instances, becoming itself a distincttrade, the Artist who follows it, has all the advantages which have beenenumerated, for improvement in his particular art; and in both ways theinvention and application of machinery are extended.

And from these causes united, the mereseparation of the occupation of the cultivator, from that of the Artificer, hasthe effect of augmenting the productivepowers of labour, and with them, the total mass of the produce or revenueof a Country. In this single view of the subject, therefore, the utility ofArtificers or Manufacturers, towards promoting an increase of productiveindustry, is apparent.

2. As to an extension of the use of Machinery a point which though partlyanticipated requires to be placed in one or two additional lights.

Theemployment of Machinery forms an item of great importance in the general massof national industry. ‘Tis an artificial force brought in aid of the naturalforce of man; and, to all the purposes of labour, is an increase of hands; anaccession of strength, unencumbered too by the expence of maintaining thelaborer. May it not therefore be fairly inferred, that those occupations,which give greatest scope to the use of this auxiliary, contribute most to thegeneral Stock of industrious effort, and, in consequence, to the generalproduct of industry?

It shall be taken for granted, and thetruth of the position referred to observation, that manufacturing pursuits aresusceptible in a greater degree of the application of machinery, than those ofAgriculture. If so all the difference is lost to a community, which, instead ofmanufacturing for itself, procures the fabrics requisite to its supply fromother Countries. The substitution of foreign for domestic manufactures is atransfer to foreign nations of the advantages accruing from the employment ofMachinery, in the modes in which it is capable of being employed, with mostutility and to the greatest extent. {207}

The Cotton Mill invented in England,within the last twenty years, is a signal illustration of the generalproposition, which has been just advanced. In consequence of it, all thedifferent processes for spining Cotton are performed by means of Machines,which are [290] ut in motion by water, andattended chiefly by women and Children; [and by a smaller] number of [persons,in the whole, than are] requisite in the ordinary mode of spinning. And it isan advantage of great moment that the operations of this mill continue withconvenience, during the night, as well as through the day. The prodigiousaffect of such a Machine is easily conceived. To this invention is to beattributed essentially the immense progress, which has been so suddenly made inGreat Britain in the various fabrics of Cotton.

3. As to the additional employment of classesof the community, not ordinarily engaged in the particular business.

This is not among the least valuable ofthe means, by which manufacturing institutions con- (982) tribute toaugment the general stock of industry and production. In places where thoseinstitutions prevail, besides the persons regularly engaged in them, theyafford occasional and extra employment to industrious individuals and families,who are willing to devote the leisure resulting from the intermissions of theirordinary pursuits to collateral labours, as a resource of multiplying theiracquisitions or [their] enjoyments. The husbandman himself experiences a newsource of profit and support from the encreased industry of his wife anddaughters; invited and stimulated by the demands of the neighboringmanufactories.

Besides this advantage of occasionalemployment to classes having different occupations, there is another of anature allied to it [and] of a similar tendency. This is -- the employment of personswho would otherwise be idle (and in many cases a burthen on the community),either from the byass of temper, habit, infirmity of body, or some other cause,indisposing, or disqualifying them for the toils of the Country. It is worthyof particular remark, that, in general, women and Children are rendered more{208} useful and the latter more early useful by manufacturing establishments,than they would otherwise be. Of the number of persons employed in the CottonManufactories of Great Britain, it is computed that 4/7 nearly are women andchildren; of whom the greatest proportion are children and many of them of avery tender age.

And thus it appears to be one of theattributes of manufactures, and one of no small consequence, to give occasionto the exertion of a greater quantity of Industry, even by the same number of persons, where theyhappen to prevail, than would exist, if there were no such establishments.

4. As to thepromoting of emigration from foreign Countries.

Men reluctantly quit one course ofoccupation and livelihood for another, unless invited to it by very apparentand proximate advantages. Many, who would go from one country to another, ifthey had [291] a prospect of continuing with morebenefit the callings, to which they have been educated, will often not betempted to change their situation, by the hope of doing better, in some otherway. Manufacturers, who listening to the powerful invitations of a better pricefor their fabrics, or their labour, of greater cheapness of provisions and rawmaterials, of an exemption from the chief part of the taxes burthens andrestraints, which they endure in the old world, of greater personalindependence and consequence, under the operation of a more equal government,and of what is far more precious than mere religious toleration -- a perfectequality of religious privileges; would probably flock from Europe to theUnited States to pursue their own trades or professions, if they were once madesensible of the advantages they would enjoy, and were inspired with anassurance of encouragement and employment, will, with difficulty, be induced totransplant themselves, with a view to becoming Cultivators of Land.

If it be true then, that it is theinterest of the United States to open every possible avenue to (983) emigrationfrom abroad, it affords a weighty argument for the encouragement ofmanufactures; {209} which for the reasons just assigned, will have thestrongest tendency to multiply the inducements to it.

Here is perceived an important resource,not only for extending the population, and with it the useful and productivelabour of the country, but likewise for the prosecution of manufactures,without deducting from the number of hands, which might otherwise be drawn totillage; and even for the indemnification of Agriculture for such as mighthappen to be diverted from it. Many, whom Manufacturing views would induce toemigrate, would afterwards yield to the temptations, which the particularsituation of this Country holds out to Agricultural pursuits. And whileAgriculture would in other respects derive many signal and unmingledadvantages, from the growth of manufactures, it is a problem whether it wouldgain or lose, as to the article of the number of persons employed in carryingit on.

5. As to thefurnishing greater scope for the diversity of talents and dispositions, whichdiscriminate men from each other.

This is a much more powerful mean ofaugmenting the fund of national Industry than may at first sight appear. It isa just observation, that minds of the strongest and most active powers fortheir proper objects fall below mediocrity and labour without effect, ifconfined to uncongenial pursuits. And it is thence to be inferred, that theresults of human exertion may be immensely increased by diversifying itsobjects. When all the different kinds of industry obtain in a community, eachindividual can find his proper element, and can call [292] intoactivity the whole vigour of his nature. And the community is benefitted by theservices of its respective members, in the manner, in which each can serve itwith most effect.

If there be anything in a remark often tobe met with -- namely that there is, in the genius of the people of thiscountry, a peculiar aptitude for mechanic improvements, it would operate as aforcible reason for giving opportunities to the exercise of that species oftalent, by the propagation of manufactures. {210}

6. As to theaffording a more ample

and variousfield for enterprise.

This also is of greater consequence in thegeneral scale of national exertion, than might perhaps on a superficial view besupposed, and has effects not altogether dissimilar from those of thecircumstance last noticed. To cherish and stimulate the activity of the humanmind, by multiplying the objects of enterprise, is not among the leastconsiderable of the expedients, by which the wealth of a nation may bepromoted. Even things in themselves not positively advantageous, sometimesbecome so, by their tendency to provoke exertion. Every new scene, which isopened to the busy nature of man to rouse and exert itself, is the addition ofa new energy to the general stock of effort.

The spirit of enterprise, useful andprolific as it is, must necessarily be contracted or expanded in proportion tothe simplicity or variety of the oc- (984) cupations and productions,which are to be found in a Society. It must be less in a nation of merecultivators, than in a nation of cultivators and merchants; less in a nation ofcultivators and merchants, than in a nation of cultivators, artificers andmerchants.

7. As to thecreating, in some instances, a new, and securing in all a more certain andsteady demand

for the surplus produce of the soil.

This is among the most important of thecircumstances which have been indicated. It is a principal mean, by which theestablishment of manufactures contributes to an augmentation of the produce orrevenue of a country, and has an immediate and direct relation to theprosperity of Agriculture.

It is evident, that the exertions of thehusbandman will be steady or fluctuating, vigorous or feeble, in proportion tothe steadiness or fluctuation, adequateness, or inadequateness of the marketson which he must depend, for the vent of the surplus, which may be produced byhis labour; and that such surplus in the ordinary course of things will begreater or less in the same proportion. {211}

For the purpose of this vent, a domesticmarket is greatly to be

[293] preferred to a foreign one;because it is in the nature of things, far more to be relied upon.

It is a primary object of the policy ofnations, to be able to supply themselves with subsistence from their own soils;and manufacturing nations, as far as circumstances permit, endeavor to procure,from the same source, the raw materials necessary for their own fabrics. Thisdisposition, urged by the spirit of monopoly, is sometimes even carried to aninjudicious extreme. It seems not always to be recollected, that nations, whohave neither mines nor manufactures, can only obtain the manufactured articles,of which they stand in need, by an exchange of the products of their soils; andthat, if those who can best furnish them with such articles are unwilling togive a due course to this exchange, they must of necessity make every possibleeffort to manufacture for themselves, the effect of which is that themanufacturing nations abrige the natural advantages of their situation, throughan unwillingness to permit the Agricultural countries to enjoy the advantagesof theirs, and sacrifice the interests of a mutually beneficial intercourse tothe vain project of selling every thing andbuying nothing.

But it is also a consequence of thepolicy, which has been noted, that the foreign demand for the products ofAgricultural Countries, is, in a great degree, rather casual and occasional,than certain or constant. To what extent injurious interruptions of the demandfor some of the staple commodities of the United States, may have beenexperienced, from that cause, must be referred to the judgment of those who areengaged in carrying on the commerce of the country; but it may be safelyassumed, that such interruptions are at times very inconveniently felt, andthat cases not unfrequently occur, in which markets are so confined andrestricted, as to render the demand very unequal to the supply.

Independently (985) likewise of theartificial impediments, which are created by the policy in question, there arenatural causes tending to render the external demand for the surplus ofAgricultural nations a precarious reliance. The differences of seasons, {212} in the countries, which are theconsumers make immense differences in the produce of their own soils, indifferent years; and consequently in the degrees of their necessity for foreignsupply. Plentiful harvests with them, especially if similar ones occur at thesame time in the countries, which are the furnishers, occasion of course a glutin the markets of the latter.

Considering how fast and how much theprogress of new settlements in the United States must increase the surplusproduce of the soil, and weighing seriously the tendency of the system, whichprevails [294] among most of the commercial nations ofEurope; whatever dependence may be placed on the force of natural circumstancesto counteract the effects of an artificial policy; there appear strong reasonsto regard the foreign demand for that surplus as too uncertain a reliance, andto desire a substitute for it, in an extensive domestic market.

To secure such a market, there is no otherexpedient, than to promote manufacturing establishments. Manufacturers whoconstitute the most numerous class, after the Cultivators of land, are for thatreason the principal consumers of the surplus of their labour.

This idea of an extensive domestic marketfor the surplus produce of the soil is of the first consequence. It is of allthings, that which most effectually conduces to a flourishing state ofAgriculture. If the effect of manufactories should be to detach a portion ofthe hands, which would otherwise be engaged in Tillage, it might possibly causea smaller quantity of lands to be under cultivation but by their tendency toprocure a more certain demand for the surplus produce of the soil, they would,at the same time, cause the lands which were in cultivation to be betterimproved and more productive. And while, by their influence, the condition ofeach individual farmer would be meliorated, the total mass of Agriculturalproduction would probably be increased. For this must evidently depend as much,if not more, upon the degree of improvement; than upon the number of acresunder culture.

It merits particular observation, that themultiplication of manufactories not only furnishes a Market for those articles,{213} which have been accustomed to be produced in abundance, in a country; butit likewise creates a demand for such as were either unknown or produced ininconsiderable quantities. The bowels as well as the surface of the earth areransacked for articles which were before neglected. Animals, Plants andMinerals acquire an utility and value, which were before unexplored.

The foregoing considerations seemsufficient to establish, as general propositions, That it is the interest ofnations to diversify the industrious pursuits of the individuals, who composethem -- That the establishment of manufactures is calculated not only to (986)increase the general stock of useful and productive labour; but even toimprove the state of Agriculture in particular; certainly to advance theinterests of those who are engaged in it. There are other views, that will behereafter taken of the subject, which, it is conceived, will serve to confirmthese inferences.

IIIPreviously to a further discussion of the objections to the encouragement ofmanufactures which have been stated, it will be of use to [295] see what can be said, in reference to the particularsituation of the United States, against the conclusions appearing to resultfrom what has been already offered.

It may be observed, and the idea is of noinconsiderable weight, that however true it might be, that a State, whichpossessing large tracts of vacant and fertile territory, was at the same time secludedfrom foreign commerce, would find its interest and the interest of Agriculture,in diverting a part of its population from Tillage to Manufactures; yet it willnot follow, that the same is true of a State, which having such vacant andfertile territory, has at the same time ample opportunity of procuring fromabroad, on good terms, all the fabrics of which it stands in need, for thesupply of its inhabitants. The power of doing this at least secures the greatadvantage of a division of labour; leaving the farmer free to pursueexclusively the culture of his land, and enabling him to procure with itsproducts the manufactured supplies requisite either to his wants or to hisenjoyments. And though it should be true, that in settled countries, the diversificationof Industry is conducive to an increase {214} in the productive powers oflabour, and to an augmentation of revenue and capital; yet it is scarcelyconceivable that there can be any [thing] of so solid and permanent advantageto an uncultivated and unpeopled country as to convert its wastes intocultivated and inhabited districts. If the Revenue, in the mean time, should beless, the Capital, in the event, must be greater.

To these observations, the followingappears to be a satisfactory answer --