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Second Book
The Theory
Chapter 11
Political and Cosmopolitical Economy
Before Quesnay and the French economists there existed only a
practice of political economy which was exercised by the State
officials； administrators； and authors who wrote about matters of
administration； occupied themselves exclusively with the
agriculture； manufactures； commerce； and navigation of those
countries to which they belonged； without analysing the causes of
wealth； or taking at all into consideration the interests of the
whole human race。
Quesnay （from whom the idea of universal free trade originated）
was the first who extended his investigations to the whole human
race； without taking into consideration the idea of the nation。 He
calls his work 'Physiocratie； ou du Gouvernement le plus avantageux
au Genre Humain；' his demands being that we must imagine that the
merchants of all nations formed one commercial republic。 Quesnay
undoubtedly speaks of cosmopolitical economy； i。e。 of that science
which teaches how the entire human race may attain prosperity； in
opposition to political economy； or that science which limits its
teaching to the inquiry how a given nation can obtain （under the
existing conditions of the world） prosperity； civilisation； and
power； by means of agriculture； industry； and commerce。
Adam Smith（1*） treats his doctrine in a similarly extended
sense； by making it his task to indicate the cosmopolitical idea of
the absolute freedom of the commerce of the whole world in spite of
the gross mistakes made by the physiocrates against the very nature
of things and against logic。 Adam Smith concerned himself as little
as Quesnay did with true political economy； i。e。 that policy which
each separate nation had to obey in order to make progress in its
economical conditions。 He entitles his work； 'The Nature and Causes
of the Wealth of Nations' （i。e。 of all nations of the whole human
race）。 He speaks of the various systems of Political economy in a
separate part of his work solely for the purpose of demonstrating
their non…efficiency； and of proving that 'political' or national
economy must be replaced by 'cosmopolitical or world…wide economy。'
Although here and there he speaks of wars； this only occurs
incidentally。 The idea of a perpetual state of peace forms the
foundation of all his arguments。 Moreover； according to the
explicit remarks of his biographer； Dugald Stewart； his
investigations from the commencement are based upon the principle
that 'most of the State regulations for the promotion of public
prosperity are unnecessary； and a nation in order to be transformed
from the lowest state of barbarism into a state of the highest
possible prosperity needs nothing but bearable taxation； fair
administration of justice； and peace。' Adam Smith naturally
understood under the word 'peace' the 'perpetual universal peace'
of the Abb椤t。 Pierre。
J。 B。 Say openly demands that we should imagine the existence
of a universal republic in order to comprehend the idea of general
free trade。 This writer； whose efforts were mainly restricted to
the formation of a system out of the materials which Adam Smith had
brought to light； says explicitly in the sixth volume （p。 288） of
his 'Economie politique pratique'。 'We may take into our
consideration the economical interests of the family with the
father at its head； the principles and observations referring
thereto will constitute private economy。 Those principles； however；
which have reference to the interests of whole nations； whether in
themselves or in relation to other nations； form public economy
（l'閏onomie publique）。 Political economy； lastly； relates to the
interests of all nations； to human society in general。'
It must be remarked here； that in the first place Say
recognises the existence of a national economy or political
economy； under the name '閏onomie publique；' but that he nowhere
treats of the latter in his works； secondly； that he attributes the
name political economy to a doctrine which is evidently of
cosmopolitical nature； and that in this doctrine he invariably
merely speaks of an economy which has for its sole object the
interests of the whole human society； without regard to the
separate interests of distinct nations。
This substitution of terms might be passed over if Say； after
having explained what he calls political economy （which； however；
is nothing else but cosmopolitical or world…wide economy； or
economy of the whole human race）； had acquainted us with the
principles of the doctrine which he calls '閏onomie publique；'
which however is； properly speaking； nothing else but the economy
of given nations； or true political economy。
In defining and developing this doctrine he could scarcely
forbear to proceed from the idea and the nature of the nation； and
to show what material modifications the 'economy of the whole human
race' must undergo by the fact that at present that race is still
separated into distinct nationalities each held together by common
powers and interests； and distinct from other societies of the same
kind which in the exercise of their natural liberty are opposed to
one another。 However； by giving his cosmopolitical economy the name
political； he dispenses with this explanation； effects by means of
a transposition of terms also a transposition of meaning； and
thereby masks a series of the gravest theoretical errors。
All later writers have participated in this error。 Sismondi
also calls political economy explicitly 'La science qui se charge
du bonheur de l'esp鑓e humaine。' Adam Smith and his followers teach
us from this mainly nothing more than what Quesnay and his
followers had taught us already； for the article of the 'Revue
M閠hodique' treating of the physiocratic school states； in almost
the same words： 'The well…being of the individual is dependent
altogether on the well…being of the whole human race。'
The first of the North American advocates of free trade； as
understood by Adam Smith Thomas Cooper； President of Columbia
College denies even the existence of nationality； he calls the
nation 'a grammatical invention；' created only to save periphrases；
a nonentity； which has no actual existence save in the heads of
politicians。 Cooper is moreover perfectly consistent with respect
to this； in fact much more consistent than his predecessors and
instructors； for it is evident that as soon as the existence of
nations with their distinct nature and interests is recognised； it
becomes necessary to modify the economy of human society in
accordance with these special interests； and that if Cooper
intended to represent these modifications as errors； it was very
wise on his part from the beginning to disown the very existence of
nations。
For our own part； we are far from rejecting the theory of
cosmopolitical economy； as it has been perfected by the prevailing
school； we are； however； of opinion that political economy； or as
Say calls it '閏onomie publique；' should also be developed
scientifically； and that it is always better to call things by
their proper names than to give them significations which stand
opposed to the true import of words。
If we wish to remain true to the laws of logic and of the
nature of things； we must set the economy of individuals against
the economy of societies； and discriminate in respect to the latter
between true political or national economy （which； emanating from
the idea and nature of the nation； teaches how a given nation in
the present state of the world and its own special national
relations can maintain and improve its economical conditions） and
cosmopolitical economy； which originates in the assumption that all
nations of the earth form but one society living in a perpetual
state of peace。
If； as the prevailing school requites； we assume a universal
union or confederation of all nations as the guarantee for an
everlasting peace； the principle of international free trade seems
to be perfectly justified。 The less every individual is restrained
in pursuing his own individual prosperity； the greater the number
and wealth of those with whom he has free intercourse； the greater
the area over which his individual activity can exercise itself；
the easier it will be for him to utilise for the increase of his
p
