From the principles deduced in the preceeding chapter, we have seen how, without the aid of any law, the interest of money, in a trading nation, becomes determined, from natural causes, and from the irresistible effects of competition. But as there is no country in the world so entirely given to commerce, as not to contain great numbers of people, who are totally unacquainted with it, a regulation becomes necessary to restrain, on one hand, the frenzy of those, who, listening to nothing but the violence of their passions, are willing to procure money at any rate for the gratification of them, let the political consequences of their dissipation prove ever so hurtful; and on the other, to protect those who, from necessity, may be obliged to submit to the heavy oppression of their usurious creditors. Laws restraining usury, are directly calculated for the sake of those two classes, not engaged in commerce, and indirectly calculated for commerce itself; which otherwise might receive a wound through their sides. In entring upon the subject mentioned in the title of this chapter, I think we may agree in this, that hitherto all regulations made concerning interest, have been calculated either for bringing it down, or for preventing its rise. The distress which may come upon a state, by its falling too low, is a phænomenon which has not yet manifested itself in any modern state, by any symptom I can at present recollect. Now if it be true, as I think it has been proved, that the operations of demand and competition work irresistible effects in determining the rate of interest in commercial states; the statesman who is about to make a regulation, must keep these principles constantly in his eye. If we examine the writings of those who have treated of this subject with intelligence (among whom, I think, Child has a right to stand in the foremost rank) we shall find very little attention bestowed upon that most necessary and ruling principle. He lays it down as an axiom, that low interest is the soul of trade, in which he is certainly right; but he seems to think, _that it is in the power of a legislature, by statute, to bring interest down to that level which is most advantageous to trade_; and in this I differ from him. I must do him the justice to say, that he no where directly affirms that proposition; but by suggesting none of the inconveniences which may follow upon an arbitrary reduction of interest by statute, he leaves his reader at liberty to suppose, that the lowering of it is solely in the hands of a statesman.