Thomas Mun (1571-1641)
England's Treasure By Foreign Trade

Original Electronic Text at the web site of the Department of Economics, McMaster University.

Born into a London merchant family, Thomas Mun became a succesful merchant in the Mediterranean trade, capturing a significant share of the trade between England and Turkey. In 1615, he became director of the powerful East India Company. While continuing to serve the Company, he authored numerous books in the 1620s and 30s, including economic writings and advice books. England's Treasure by Foreign Trade belongs to both of these genres; it is a book wherein Mun gives advice to his son about being a good merchant and about the creation of wealth. It was probably written in 1630, but not published until 1664, twenty-three years after Mun's death.

1. How do the qualities of a "perfect merchant" compare with the qualities of one trained in the liberal arts, as outlined by Vergerius?
2. How does Mun compare the merchant with the noble? Why does Mun feel the need to defend the merchant and compare him favorably with the noble?
3. What were the "Means to enrich this Kingdom"?
4. How does Mun respond to critics of usury (charging interest on loans)? What, do you suppose, was the basis for the criticism of usury? What distinguishes the thinking of Mun from the critics of usury?
5. How does Mun respond to critics of excessive "Bounty and Pomp"? What, do you suppose, was the rationale for criticising "Bounty and Pomp"? What distinguishes the thinking of Mun from the critics of "Bounty and Bomp"
6. Given the nature of Mun's defense of merchants and given the nature of the criticism of merchants (inferred from Mun's argument), what were the chief obstacles faced by merchants, and, more generally, faced by capitalism?

[1] My Son, In a former Discourse I have endeavoured after my manner briefly to teach thee two things: The first is Piety, how to fear God aright, according to his Works and Word: The second is Policy, how to love and serve thy Country, by instructing thee in the duties and proceedings of sundry Vocations, which either order, or else act the affairs of the Common-wealth; In which as some things doe especially lend to Preserve, and others are more apt to Enlarge the same: So am I now to speak of Money, which doth indifferently [unconsciously] serve to both those happy ends. Wherein I will observe this order, First, to show the general means whereby a Kingdome may be enriched; and then to proceed to those particular courses by which Princes are accustomed to be supplyed with Treasure. But first of all I will say something of the Merchant, because he must be a Principal Agent in this great business.

Chapter 1
The Qualities which are required in a perfect Merchant of Forraign Trade.

[2] The love and service of our Country consisteth not so much in the knowledge of those duties which are to be performed by others, as in the skilful practice of that which is done our selves; and therefore (my Son) it is now fit that I say something of the Merchant, which I hope in due time shall be thy Vocation: Yet herein are my thougths free from all Ambition, although I rank thee in a place of so high esteem; for the Merchant is worthily called The Steward of the Kingdoms Stock, by way of Commerce with other Nations; a work of no less Reputation than Trust, which ought to be performed with great skill and conscience, that so the private gain may ever accompany the publique good. And because the nobleness of this profession may the better stir up thy desires and endeavours to obtain those abilities which may effect it worthily, I well briefly set down the excellent qualities which are required in a perfect Merchant. [3] Thus have I briefly shewed thee a pattern for thy diligence, the Merchant in his qualities; which in truth are such and so many, that I find no other profession which leadeth into more worldly knowledge. And it cannot be denied but that their sufficiency doth appear likewise in the excellent government of State at Venice, Luca, Genoua, Florence, the low Countreys, and divers other places of Christendom. And in those States also where they are least esteemed, yet is their skill and knowledge often used by those who sit in the highest places of Authority: It is therefore an act beyond rashness in some, who do dis-enable their Counsel and judgment (even in books printed) making them uncapable of those ways and means which do either enrich or impoverish a Commonwealth, when in truth this is only effected by the mystery of their trade, as I shall plainly show in that which followeth. It is true indeed that many Merchants here in England finding less encouragement given to their profession than in other Countries, and seeing themselves not so well esteeemed as their Noble Vocation requireth, and according to the great consequence of the same, do not therefore labour to attain unto the excellency of their profession, neither is it practised by the Nobility of this Kingdom as it is in other States from the Father to the Son throughout their generations, to the great encrease of their wealth, and maintenance of their names and families: Whereas the memory of our richest Merchants is suddenly extinguished; the Son being left rich, scorneth the profession of his Father, conceiving more honor to be a Gentleman (although but in name) to consume his estate in dark ignorance and excess, than to follow the steps of his Father as an Industrious Merchant to maintain and advance his Fortunes. But now leaving the Merchants praise we will come to his practice, or at least to so much thereof as concerns the bringing of Treasure into the Kingdom.

Chapter 2
The Means to enrich this Kingdom, and to encrease our Treasure.

[4] Although a Kingdom may be enriched by gifts received, or by purchase taken from some other Nations, yet these are things uncertain and of small consideration when they happen. The ordinary means therefore to increase our wealth and treasure is by Foreign Trade, wherein we must ever observe this rule; to sell more to strangers yearly than we consume of theirs in value. For suppose that when this Kingdom is plentifully served with the Cloth, Lead, Tin, Iron, Fish and other native commodities, we doe yearly export the overplus to foreign Countries to the value of twenty two hundred thousand pounds; by which means we are enabled beyond the Seas to buy and bring in foreign wares for our use and Consumption, to the value of twenty hundred thousand pounds; By this order duly kept in our trading, we may rest assured that the Kingdom shall be enriched yearly two hundred thousand pounds, which must be brought to us in so much Treasure; because that part of our stock which is not returned to us in wares must necessarily be brought home in treasure.

[5] For in this case it cometh to pass in the stock of a Kingdom, as in the estate of a private man; who is supposed to have one thousand pounds yearly revenue and two thousand pounds of ready money in his Chest: If such a man through excess shall spend one thousand five hundred pounds per annum, all his ready mony will be gone in four years; and in the like time his said money will be doubled if he take a Frugal course to spend but five hundred pounds per annum; which rule never faileth likewise in the Commonwealth, but in some cases (of no great moment) which I will hereafter declare, when I shall show by whom and in what manner this ballance of the Kingdoms account ought to be drawn up yearly, or so often as it shall please the State to discover how much we gain or lose by trade with foreign Nations. . . .

Chapter 15.
Of some Excesses and evils in the Commonwealth, which notwithstanding decay not our Trade nor Treasure.

[6] It is not my intent to excuse or extenuate any the least excess or evil in the Commonwealth, but rather highly to approve and commend that which by others hath been spoken and written against such abuses. Yet in this discourse of Treasure, as I have already set down affirmatively, which are the true causes that may either augment or decrease the same: so is it not impertinent to continue my negative declarations of those enormities and actions which cannot work these effects as some men have supposed. For in redress of this important business, if we mistake the nature of the Malady, we shall ever apply such cures as will at least delay, if not confound the Remedy.

[7] Let us then begin with Usury, which if it might be turned into Charity, and that they who are Rich would lend to the poor freely; it were a work pleasing to Almighty God, and profitable to the Commonwealth. But taking it in the degree it now stands; How can we well say, that as Usury increaseth, so Trade decreaseth? For although it is true that some men give over trading, and buy Lands, or put out their Money to use when they are grown rich, or old, or for some other the like occasions; yet for all this it doth not follow, that the quantity of the trade must lessen; for this course in the rich giveth opportunity presently to the younger & poorer Merchants to rise in the world, and to enlarge their dealings; to the performance whereof, if they want [lack] means of their own, they may, and do,take it up at interest: so that our money lies not dead, it is still traded. How many Merchants, and Shop-keepers have begun with little or nothing of their own, and yet are grown very rich by trading with other mens money? do we not know, that when trading is quick and good, many men, by means of their experience, and having credit to take up money at interest, do trade for much more than they are worth of their own stock? by which diligence of the industrious, the affairs of the Commonwealth are increased, the moneys of Widows, Orphans, Lawyers, Gentlemen and others, are employed in the course of Foreign Trade, which themselves have no skill to perform. We find at this present, that notwithstanding the Poverty we are fallen into by the Excesses and Losses of late times, yet that many men have much money in their chests, and know not how to dispose thereof, because the Merchant will not take the same at interest (although at low rates) in regard there is a stop of trade in Spain and in France, whereby he cannot employ his own means, much less other men's moneys. So that for these, and some other reasons which might be alledged, we might conclude, contrary to those who affirm, that Trade decreaseth as Usury encreaseth, for they rise and fall together. . . .

[8] Lastly, all kind of Bounty and Pomp is not to be avoided, for if we should become so frugal, that we would use few or no Foreign wares, how shall we then vent [sell] our own commodities? what will become of our Ships, Mariners, Munitions, our poor Artificers, and many others? doe we hope that other Countries will afford us money for All our wares, without buying or bartering for Some of theirs? this would prove a vain expectation; it is more safe and sure to run a middle course by spending moderately, which will purchase treasure plentifully.

[9] Again, the pomp of Buildings, Apparel, and the like, in the Nobility, Gentry, and other able persons, cannot impoverish the Kingdome; if it be done with curious and costly works upon our Materials, and by our own people, it will maintain the poor with the purse of the rich, which is the best distribution of the Commonwealth. But if any man say, that when the people want work, then the Fishing-trade would be a better employment, and far more profitable; I subscribe willingly. For in that great business there is means enough to employ both rich and poor, whereof there hath been much said and written; It resteth only that something might be as well affected for the honor and wealth, both of the King and his Kingdoms.

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