Mercantilism by definition is for a nation to maximize wealth through
trade, and accumulation of silver, gold. Mercantilism underlines Europe from 16
to 18 century, where European Imperialism had exclusive right to export
manufacture to the colonies, in case of British in India, the British destroy
India economy. The colonies where consider only the raw material for
motherland.
The way to maintain the control tariff were introduced specially
manufacture, the tariff is aggressive to accumulated larges supplaces. Arendt
in The Origins of Totalitarianism, and invention to justify introduction of
race, while slave trade was stopped, the US codify in the law where slaves
can´t free them and their decedents permanent bound.
Arendt point out epitome of
Imperialism was Cecil Rhodes not only created a country in his name, or
control of the Natural Resources, his believe was expansion, Rhodes believed
the if could will Annex the Planets, and to justify superiority over, white
races the only one. Mercantilism and Imperialism when had to hand, but the
moment liberation taken place created crisis.
The Austrian lawyer Philipp Wilhelm von Hornick, one of the pioneers of
Cameralism, detailed a nine-point program of what he deemed effective national
economy in his Austria Over All, If She Only Will of 1684, which
comprehensively sums up the tenets of mercantilism:
- That
every little bit of a country's soil be utilized for agriculture, mining or
manufacturing
- That
all raw materials found in a country be used in domestic manufacture, since
finished goods have a higher value than raw materials
- That
a large, working population be encouraged
- That
all exports of gold and silver be prohibited and all domestic money be kept in
circulation
- That
all imports of foreign goods be discouraged as much as possible
- That
where certain imports are indispensable they be obtained at first hand, in
exchange for other domestic goods instead of gold and silver
- That
as much as possible, imports be confined to raw materials that can be finished (in the home country)
- That
opportunities be constantly sought for selling a country's surplus manufactures
to foreigners, so far as necessary, for gold and silver
In the case of France relationship to the colonies It sought to derive
the maximum material benefit from the colony, for the homeland, with a minimum
of imperial investment in the colony itself. The ideology was embodied through
the establishment under Royal Charter of a number of corporate trading
monopolies including La Compagnie des
Marchands, which operated from 1613 to 1621, and the Compagnie de Montmorency,
from that date until 1627.
Mercantilism was the economic version of warfare using economics as a
tool for warfare by other means backed up by the state apparatus, and was well
suited to an era of military warfare. Since the level of world trade was viewed
as fixed, it followed that the only way to increase a nation's trade was to
take it from another. A number of wars, most notably the Anglo-Dutch Wars and the
Franco-Dutch Wars, can be linked directly to mercantilism theories. Most
wars had other causes but they reinforced mercantilism by clearly defining the
enemy, and justified damage to the enemy's economy.
Merchants benefited greatly from the enforced monopolies, bans on
foreign competition, and poverty of the workers. Governments benefited from the
high tariffs and payments from the merchants and European trade exported
bullion to pay for goods from Asia, thus reducing the money supply and putting
downward pressure on prices and economic activity.
Locke's Second Treatise also points towards the heart of the
anti-mercantilist critique:
“that the wealth of the world is
not fixed, but is created by human labor ”
Mercantilists failed to understand the notions of absolute advantage and
comparative advantage (1817 by David Ricardo) and the benefits of trade.
Hume noted the impossibility of the mercantilists:
“goal of a constant positive
balance of trade”
As bullion flowed into one country, the supply would increase, and the value
of bullion in that state would steadily decline relative to other goods.
Conversely, in the state exporting bullion, its value would slowly rise.
Eventually it would no longer be cost-effective to export goods from the
high-price country to the low-price country, and the balance of trade would
reverse. Mercantilism fundamentally misunderstood this, that an increase in
the money supply simply meant that everyone have wealth.
Murray Rothbard:
“Mercantilism, which reached its
height in the Europe of the seventeenth and eighteenth centuries, was a system
of statism which employed economic fallacy to build up a structure of imperial
state power, as well as special subsidy and monopolistic privilege to
individuals or groups favored by the state. Thus, mercantilism held exports
should be encouraged by the government and imports discouraged”
While the laissez-faire become respond, and the technological changes
creates economic displace, with introduction of race, ethnic identity as social
factor, which never factor in the economics theories, utilized as political
theory by the extreme right to explain not just dislocation, but reason of the
state did not provided support due to dislocation, someone have worse than us or
they take opportunity from us, by limiting the resources.
Appealing to despair and lack of hope, the society decent to nihilism like
case National Front in Algeria, where the Fundamentalist win the elections and
Military unwilling, the National Front excommunicated himself, the point a
Nihilist of self-destruction.
The white populism in US and Europe based economic theory neo-mercantilism,
and race as solution to the economic dislocation. One of the factors Mercantilism
was displacing, the technology innovation, has displaced their manufacture
jobs.
