As the general interest of each nation requires that there should be perfect liberty in the exchange of commodities, any restriction on such liberty, for the sake of benefiting any particular class or classes, is a sacrifice of a larger interest to a smaller,—that is a sin in government. This sin is committed when,— First,—Any protection is granted powerful enough to tempt to evasion, producing disloyalty, fraud, and jealousy: when, Secondly,—Capital is unproductively consumed in the maintenance of an apparatus of restriction: when, Thirdly,—Capital is unproductively bestowed in enabling those who produce at home dearer than foreigners to sell abroad as cheap as foreigners,—that is, in bounties on exportation: and when, Fourthly,—Capital is diverted from its natural course to be employed in producing at home that which is expensive and inferior, instead of in preparing that which will purchase the same article cheap and superior abroad,—that is, when restrictions are imposed on importation. But though the general interest is sacrificed, no particular interest is permanently benefited, by special protections: since Restrictive regulations in favour of the few are violated, when such violation is the interest of the many; and Every diminution of the consumer’s fund causes a loss of custom to the producer. Again, The absence of competition and deprivation of custom combine to make his article inferior and dear; which inferiority and dearness cause his trade still further to decline. Such are the evils which attend the protection of a class of producers who cannot compete with foreign producers of the same article. If home producers can compete with foreign producers, they need no protection, as, _cæteris paribus_, buying at hand is preferable to buying at a distance. Free competition cannot fail to benefit all parties:— Consumers, by securing the greatest practicable improvement and cheapness of the article; Producers, by the consequent perpetual extension of demand;—and Society at large, by determining capital to its natural channels. ------- Colonies are advantageous to the mother-country as affording places of settlement for her emigrating members, and opening markets where her merchants will always have the preference over those of other countries, from identity of language and usages. Colonies are not advantageous to the mother-country as the basis of a peculiar trade. The term “colony trade” involves the idea of monopoly; since, in a free trade, a colony bears the same relation as any other party to the mother-country. Such monopoly is disadvantageous to the mother-country, whether possessed by the government, as a trading party, by an exclusive company, or by all the merchants of the mother-country.