Francois Nicolas Mollien Quotes
… the most disastrous and the most false of fiscal inventions.
Francois Nicolas Mollien, 1758-1850, French Minister of the Treasury, Description of Napolean’s trade protection and boycott system of all nations that traded with England to try and weaken England. It harmed French Commerce worse., Memoirs
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This agreement was not a law as an English colony like South Carolina could not pass a law that prohibited buying English merchandise. It was unofficial and great pressure was put on any citizen who would not sign it. The merchants that did import goods other than those allowed in the agreement were boycotted by most of the signers. This quotation illustrates what may have been the first organized protectionist actions to assist domestic producers and manufacturers. It is valuable for another reason. The quotation lists goods that are exempted from the boycott. These were goods that were not made in South Carolina or nearby states at the time since if they were, they would have been protected, So we can learn what was manufactured in the colony or nearby at the time—that which is nit on the list but was important to colonial life. The list tells us what was not manufactured locally, and one of the most important were firearms and ammunition. The inability to manufacture armaments plagued the colonies and early America after the revolution. One of the major public expenditures was to create and subsidize domestic arms manufacture.
Surprising to us today is the reality that before this law, it was perfectly legal for American Citizens to sell transport all kinds of goods and materials to enemies of the country—even in the midst of a war. At the beginning of the War of 1812, New England merchants were selling, shipping, and delivering meat and other critical provisions to the English Armies in Canada. There is an unfortunate long history of this. IBM sold punch card equipment and technology to the Nazis through European subsidiaries prior to and during WWII. American oil companies were helping the Arab countries enforce their embargo against is in the 1970s. American firms shipped weapons technology to Iraq when they threatened to create weapons of mass destruction. It has often been difficult to get American companies to pass up profits for patriotic reasons unless there were strong laws and enforcement.
We are so used to hearing the freedom seeking reasons for the American Revolution that we overlook the more selfish and venal motives. This quotation shows that the large merchants of the colonies had banded together in an illegal conspiracy trust and monopoly and managed to keep many British competitive products out of the colonies. The British, for equally venal reasons, began to enforce the laws in favor of free trade. Many large American merchants were getting huge profits (and American consumers paying more) from their protectionist illegal monopoly. A Revolution would de facto assure that monopoly for many years to come, so they became supporters—patriots—of the American Revolution. As the Revolution drew closer, the Americans made efforts to protect the protectionism and monopoly of some of the richest Americans. See {636861}.
There was, well before the American Revolution, a restriction on the importation of British goods into the American colonies. Partially this was to pressure Parliament to stop some of its most repressive lawmaking. But it also supported what had become a very lucrative protectionist monopoly of large American merchants. See {636861}.
2nd Earl of Guilford. This bill cut off all trade with the American Colonies. It was meant as pressure to cease the rebellion. It did not work.
The most successful way of poor nations developing rapidly is to trade with rich nations.
This was one of the first and is considered the best of the Colonial arguments against taxation without representation. The argument here about exports also affected other commodities—see {636866}. Despite this, Dulany is not well known in American history because when the Revolution finally came he was a loyalist.
Large financial companies insist on profits at regular intervals and predictability whereas the innovative companies do not do well trying to meet those conditions and spending their time with the large finance company. While large financial companies were important to finance companies on the latter part of the 20th century, it was the smaller finance companies who financed most of the very important start-ups. By the 21st century, companies like Google and Facebook, made their own public stock offerings bypassing the financial industry. Many other smaller companies were financed via crowd sourcing which also bypasses the financial industry. His point is that the large successful companies can get the funds the need for growth without large finance companies. Smaller firms and startups can (and do) obtain funds through small finance firms or direct private investment. The large finance companies not only inhibit innovative growth he warns but they become such a dominant and controlling force that the industry becomes too big to fail, and the failure of a single large finance company could destroy the entire country’s economy. It happened to Island when their largest bank failed, and to the United States in the Meltdown of 2008.
In England at the time, the liberals were for free trade and the conservatives against. In both England and America both liberals and conservatives have flip flopped their roles in foreign trade several times. Free trade is a two edged sword; it aids domestic growth, employment and prosperity in some cases and hurts them on others. And there are always winners and losers for each example of free trade within any country. The result is no long term commitment and much flip flopping.
In this case the tariffs were imposed not to protect national industries but to simply raise revenue. In the early years of the United States, almost all of the Federal Revenue was raised this way.
