Superphysics Superphysics
Chapter 3

The Origin of Free-Traders

by Adam Smith Icon
5 minutes  • 997 words
Table of contents

1 After the fall of the Roman empire, the people of cities and towns were not more favoured than those of the countryside.

  • They were very different from the first inhabitants of the ancient Greek and Italian republics.

Those of Greece and Italy were composed chiefly of the [rural] proprietors of lands.

  • They built their houses near each other with a wall for common defence.

After the fall of the Roman empire, those proprietors lived in castles on their own estates in the midst of their own tenants and dependants.

  • The towns were chiefly inhabited by tradesmen and mechanics.
  • In those days, townspeople were servile.

The privileges granted by ancient charters to European townspeople show that before those grants:

  • tradesmen and mechanics could not allow their own daughters to marry without their lord’s consent,
  • upon their death, their goods would belong to their lord instead of their own children, and
  • they could not dispose of their own effects by will.

These privileges prove that townspeople were serfs, as people in the countryside.

2 The tradesmen and mechanics were very poor and mean people. They traveled with their goods from place to place and from fair to fair, like the current hawkers and peddlers.

In all European countries, like in present-day Russia, taxes were levied on the persons and goods of travelers when they:

  • passed through certain estates,
  • went over certain bridges,
  • carried their goods from place to place in a fair, and
  • erected a booth or stall in a fair to sell them.

These taxes were known in England as passage, pontage, lastage, and stallage.

In those days, only important people were given protection. Sometimes, the king or a great lord would grant a tax exemption to traders who lived in their territory. Such traders, though servile, were called Free-traders.

In return, they paid an annual poll tax* to their protector. This poll tax compensated the losses of the great lord from their exenption from other taxes.

  • [A fixed tax levied on all persons in a certain area]

At first, those poll taxes and exemptions were personal, being in force:

  • during their lives, or
  • during the pleasure of their protectors.

The Domesday Book* had very imperfect accounts of English towns.

  • It shows that the tax paid by each burgher was frequently mentioned to the king or to a great lord for this protection.
  • Sometimes, only the general amount of all those taxes was mentioned.
  • [The earliest national land and property survey of England.]

Outsourced Tax Collection

3 Townspeople were free much earlier than the people of the countryside.

The collection of the king’s poll taxes was assigned to the county sheriff or powerful people for a term of years for a certain rent payment.

  • These burghers frequently got enough credit to be allowed to collect the poll taxes from their own town.
  • They became jointly and severally answerable for the whole rent.

This method of tax collection was agreeable to the economy of all the European sovereigns who frequently rented out whole estates. The tenants became jointly and severally answerable for the whole rent. In return, they were:

  • allowed to collect rent in their own way, and
  • allowed to pay it into the king’s exchequer through their own officer.

This freed them from the insolence of the king’s officers. This freedom was most important to them.

How Free Traders Established Corporations

4 At first, a town’s tax collection was entrusted to burghers for a few years, in the same way that it was entrusted to other collectors.

In time, it was granted to them forever, reserving a certain rent which would never be increased. Thus, the payment and exemptions became perpetual and those exemptions ceased to be personal.

  • Those exemptions thus belonged to burghers as a whole.
  • They were called Free-burghers or Free-traders and their burgh was called a Free-burgh.

5 They gained important privileges:

  • They can give away their own daughters in marriage.
  • They are now succeeded by their own children.
  • They can dispose of their own effects by will.

Serfdom and slavery were removed and they became really free.

6 At the same time, the burghers were formed into a commonalty or corporation which had their own town council and magistrates. These made by-laws for:

  • building walls for defence, and
  • obliging their inhabitants to guard and defend those walls.

In England, those corporations were exempted from lawsuits in the district and county courts. All such pleas, except those of the crown, were left to their own magistrates.

In other countries, more jurisdictions were granted to them.

7 Such towns collected their own taxes. It is extraordinary that all European sovereigns:

  • exchanged their naturally-increasing revenue for a perpetual rent, and
  • voluntarily established independent republics within their own dominions.

Free Traders (Liberals) Versus The Feudal Lords (Conservatives)

8 To understand this, we must remember that in those days, no European sovereign was able to protect his weaker subjects from the great lords.

Those subjects who lived in lawless areas had to either:

  • become slaves or vassals of some some great lord, or
  • enter into a league of mutual defence.

The lords despised the burghers and considered them as a emancipated slaves.

  • The burghers’ wealth always provoked their envy.
  • The lords plundered them on every occasion without mercy.

The burghers naturally hated and feared the lords.

The king hated and feared the lords too. The king might despise the burghers, but he had no reason to hate or fear them.

Mutual interest disposed the burghers to support the king.

  • The king supported the burghers against the lords by making them secure and independent through privileges

Without a regular government or authority to compel the people to follow a system, no voluntary league of mutual defence could provide any security nor support for the king.

By allowing the towns to collect their own taxes forever, the king removed the jealousy and suspicion that he was ever going to oppress them by:

  • raising taxes, or
  • entrusting tax collection to others.

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