footnote which deals with the subject:  “Dr. Smith does not say that the importation of foreign commodities has any tendency to force capital abroad; and unless it did this, it is plain that his statement with respect to the effect of changing a home for a foreign trade of consumption, is quite inconsistent with the fundamental principle he has elsewhere established, that industry is always in proportion to the amount of capital.”  From this, his opening sentence, it would seem that Mr. M’Culloch mistook the force and tendancy of Adam Smith’s reasoning, who does not, in the passage annotated by Mr. M’Culloch, advocate the change of a foreign for a home trade of consumption.  He only goes to prove that a home trade is more profitable to a nation than a foreign one, in as much as it replaces two home capitals, whilst the foreign trade replaces but one.  For a country with vast manufactories, like Great Britain, the home trade would not be at all sufficient, but—­as far as it goes—­it is double as advantageous as the foreign trade.  Adam Smith seeks to prove no more.  But Mr. M’Culloch meets the question more directly as follows:  “Suppose, for the sake of illustration, that the case put by Dr. Smith actually occurs—­that the Scotch manufactures are sent to Portugal; it is obvious, if the same demand continue in London for these manufactures as before they began to be sent abroad, that additional capital and labourers will be required to furnish commodities for both the London and Portuguese markets.  In this case, therefore, instead of the industry of the country sustaining any diminution from the export of Scotch manufactures to a foreign country, it would evidently be augmented, and a new field would be discovered for the profitable employment of stock.”

As this reasoning is only a continuation of the misconception of Adam Smith’s meaning just noticed, a very few words upon it will suffice.  If the same demand continue in London for the Scotch manufactures as before they were sent to Portugal, or elsewhere, the Scotch manufacturers will be only too glad to continue to supply London and Portugal too; and the trade of the nation will be expanded; and the capital of the nation will be augmented by the foreign trade, because by that foreign trade British capital is replaced, and with a profit; but surely this does not in any way disturb the principle that the Scotch manufactures sold in London replace, or re-produce two British capitals, whilst those sold in Portugal replace, or reproduce only one.

From these considerations on Absenteeism, it may, I think, be fairly inferred that popular belief regarding its injurious effects is well founded, although misconceptions may be entertained as to the precise way in which the injury occurs.

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