Patriotism and teh political economy

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PATRIOTISM AND THE POLITICAL ECONOMY OF THE MERCANTILE STATE.

1. The rise of Early modern states in the form of strong monarchies formulates the historical context of those writers of economic issues which the great economist Joseph Schumpeter called “Consultant administrators” and others have named “mercantilists”. Those were writers between the late 16th century and the middle of the18th century who published pamphlets and tracts on economic issues, especially regarding international trade, money, finance and beneficial governance. They were state bureaucrats, merchants, politicians, swindlers; men of different trades and ranking. We find them all over Europe during the socalled Early Modern period – from Spain to northerly Scandinavia.1

The nascent state-making process uponwhich such writers contemplated and advised was carried out in a competitive struggle for power and influence. Since the late medieval period it was well understood that the economic strength of a country (or a Prince) also implied a powerful political and military position. Such thinking was a distinctive force behind what was carried out by many medieval as well as early modern rulers anddynasties up until the 18th century and has been called “fiscal” imperialism. By capturing more land the incomes
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Joseph A Schumpeter, A History of Economic Analysis. London: George Allen & Unwin 1972,p. 143f..

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of the state would rise as a consequence of more peasants paying dues and rents to the crown. However, economic strength was also – and exceedingly so – interpreted as being basedupon the whims of the market places; upon the international competition over trade and trade routes. It was often held by contemporaries that a country which could capture important trade routes would have an upper hand in times of military conflict and political power struggles. Moreover during the 17th century increasingly a view emerged among rulers that it was most favourable to establish anown industry in order to work up raw materials instead of sending them out to foreign lands. By this many more hands could be employed and there was great profits to be made by industrious manufacturers and clever merchants. Moreover through increased taxation and duties of different kinds the coffers of the state would be better provided for with money, according to a view which dominated mostminds in western Europe from the end of the 17th century. Certainly, this political economy of the relationship between economic means and power politics goes back at least to the Florentine political thinkers in the Renaissance period, including of course the most famous of them, Niccolo Machiavelli. As is well known the civic humanism version of republicanism was a broad tradition which dealt withthe role of patrotism and other republican values for a good governed and virtuous

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state.2 Hence it is a mistake only to emphasis the practical content of especially the 17th century discussion on economic issues in general and foreign trade in particular. Also, it is unfruitful also to think of the early 17th century discussion on international trade, the favourable balance of trade,etc., as mere reflections of as special merchant interest.3 In fact many of the authors – including the British - propounded their special interests within an idiom which at least partly dealt with political principles and reason of state. Especially in Discorsi and Il principe Machiavelli had set out to illustrate how a virtuous state could be preserved and developed in a new historical conjecture,the rise of Modern Princes. This theme was developed during the 16th century by among many others the Italian Giovanni Botero and even before that by the French great thinker Jean Bodin.

2. In England during the 17th and early 18th century such patriotic thinking (admittedly combined with interest group backing) was by David Hume and others named “jealousy of Trade” and very much focussed...