Before governments had been seized with this manufacturing ardour, the establishment of a new manufacture had always to struggle with a crowd of national habits and prejudices, which form as it were the vis inertiae of the human mind. To overcome this force, it was necessary to offer speculators a very manifest advantage; hence a new species of industry could scarcely arise without a distinct previous demand, and the market was always found before the manufacture destined to occupy it. Governments, in their zeal, have not proceeded upon this principle; they have ordered stockings and hats beforehand, reckoning that legs and heads would be found afterwards. They have seen their people well and economically clothed by strangers, and yet have caused them to produce clothes in the country itself. During war, this new production was not capable of being too exactly appreciated; but when peace came, it was found that all things had been made in double quantity; and the readier the mutual communication of states had become, the more embarrassed were they to dispose of all their works executed without orders.

Consumers who at the beginning had been satisfied, afterwards found themselves called to unexpected gains, because merchants, eager to recover their funds, were forced to sell a very great quantity of goods with loss. Manufacturers gave the signal for these sacrifices; resigning themselves to a cruel loss of their capital, they induced extensive merchants to furnish themselves with goods beyond their custom or ability, in order to profit by what appeared a good opportunity. Several of the latter have been forced to experience a similar loss, before their excessive supply could be introduced to the shops of retail dealers; and these again before they could make them be accepted by consumers.

A universal embarrassment was felt by manufacturers, merchants, and retailers, and this was followed by the annihilation of the capital destined to support industry. The fruit of long saving and long labour was lost in a year. Consumers have gained certainly, but their gain is scarcely perceptible even to themselves. By laying up a stock of goods for several years to profit by their cheapness, they have also included themselves in the general embarrassment, and still farther retarded the period when the balance can be re-established between consumption and production.

According to the former organization of Europe, all states did not make pretences to all kinds of industry. Some had attached themselves to agriculture, others to navigation, others to manufactures; and the condition of these latter, even in prosperous times, could not have appeared so worthy of envy as to demand prodigious efforts to attain it. A miserable and degraded population almost always produced these rich stuffs; these elegant ornaments, this furniture which it was never destined to enjoy and if the men who directed these unhappy workmen sometimes raised immense fortunes, those fortunes were as frequently destroyed. The development of nations proceeds naturally in all directions; it is scarcely ever prudent to obstruct it, but it is no less dangerous to hasten it; and the governments of Europe, by having of all hands attempted to force nations, are at the present day loaded with a population, which they have created by requiring superfluous labour, and which they know not how to save from the horrors of famine.

The existence of this manufacturing population, and the duty of providing for its wants, have constrained governments to alter the aim of their legislation. Formerly, in the real spirit of the mercantile system, they encouraged manufactures, in order to sell much to foreigners, and grow rich at their expense; now, perceiving that a prohibitive system is every where adopted, or like to be adopted, they cannot any longer count on the custom of strangers, and therefore study to find, in their own kingdom, consumers for their own workmen; in other words, to become isolated and sufficient for themselves. The system of policy at present, more or less strictly followed by all the nations of Europe, destroys all the advantages of commerce; it hinders each nation from profiting by the superiorities due to its climate, to its soil, to its situation, to the peculiar character of its people; it arms man against man, and breaks the tie which was destined to sooth national prejudices, and accelerate the civilization of the world.

According to the natural progress of increasing wealth, when capitals are yet inconsiderable, it is certainly desirable to direct them rather to some neighbouring branch of trade, than to one which is very remote; and as the trade of exportation and importation gives foreigners one half of its profit, and the natives another, a country which has little capital may desire to employ it entirely in the trade of its interior, or for its own use; and the more so, because if the market is near the producer, the same capital will be several times renewed in a given period, whilst another capital, destined for a foreign market, will scarcely accomplish a single renewal. But the capitalist's interest will always direct him with certainty, in such cases to do what suits the country best; because his profit is proportioned to the need there is of it, and consequently to the direction in which the public demand carries him.

Besides, nations, on reckoning up their produce and their wants, almost constantly forget that neighboring foreigners are much more convenient and more advantageous producers and consumers than distant countrymen. The relation of markets on the two banks of the Rhine is much more important, both for the German and the French merchant, than the relation of markets between the Palatinate and Brandenburgh is for the former, or between Alsace and Provence for the latter.