In the following year peace was concluded with America and France; and the Prime Minister boasted to Morellet that all the treaties of that year were inspired by “the great principle of free trade.” The necessity for resuming commercial intercourse with the United States raised in an acute form the problem of the colonial monopoly. Should the States be allowed to trade with Canada on the same terms as with Great Britain? William Eden (afterwards Lord Auckland) was afraid of abandoning the differential principle, and in his perplexity wrote to Smith, who replied that if the Americans really meant to subject the goods of all nations to the same import duties, they would “set an example of good sense which all other nations ought to imitate.” He had little anxiety—and his confidence was completely justified by the event—about the loss of the American monopoly. “By an equality of treatment of all nations, we might soon open a commerce with the neighbouring nations of Europe infinitely more advantageous than that of so distant a country as America.” As he hopes to see Eden in a few weeks’ time, he will not write a tedious dissertation, but contents himself with saying that “every extraordinary, either encouragement or discouragement, that is given to the trade of any country, more than to that of another, may, I think, be demonstrated to be in every case a complete piece of dupery, by which the interest of the State and the nation is constantly sacrificed to that of some particular class of traders.” He ends with warm praise of the East India Bill, and of the decisive judgment and resolution with which it had been introduced and triumphantly carried through the House of Commons by Fox.[44]