Adam Smith and his followers, and still more closely Ricardo, divided their Political Economy into two parts: in the first they consider the wealth of the nation without the "complication" of foreign trade, _i.e._ they, in fact, contemplate no money or goods as going out or coming in whatever. They then in separate chapters, forming a big appendix, consider the effects of Foreign Trade as a series of exchanges. They do not discuss even the payment of a lump sum of gold to a victorious nation. Senior, in his _Handbook of Political Economy_, has considered, first, the economy of the world conceived as a solitary, island of small size in a world-covered sea; secondly, he treats foreign trade by conceiving two such islands. There is no better way of treating Political Economy than this; and it is well for the beginner to conceive the solitary island with fifty (or a limited number of) families only on it, and work through the ordinary theorems (with figures) in this restricted case. Whatever is true of the fifty families in a small island must be true for 5,000,000 families in a big island. The facilities of modern communications have caused most countries to differ in their circumstances materially from the conditions assumed by Adam Smith and his successors as axioms. In the case of England, owing to its numerous wealthy colonies, gigantic foreign trade, and consequently world-over-spread capital, the circumstances are so completely altered that many results of the grammar of Political Economy no longer apply even in the rough to England. If Adam Smith had been asked what would happen to England if the imports for one year exceeded the exports by £150,000,000 sterling, he would have given the same answer as his predecessors, who reckoned wealth in gold and silver, or more probably he would have declined answer, pronouncing such a state of things an impossible conception. It is now as difficult to treat politico-economically the wealth of the nation as the wealth of Warwickshire--a difficulty that Adam Smith would have shrunk from. It is true that every abstract proposition concerning rent, capital, and wages now (and always) holds true for the whole world; but, so conceived, the propositions give no practical result. These things do not lesson the value of the science of Political Economy, Mr. Ranken or Dr. Pole would estimate very highly the value of a knowledge of elementary mechanics to the humblest engineer, though such elementary mechanics might not extend to the consideration of friction, etc., and might not be applicable to any bridge or steam-engine.