Locke's two Treatises of Government (published in 1690) carry us back into the region of worn-out controversies. The troublous times which intervened between the outbreak of the Civil War and the Revolution of 1688, including some years on either side, naturally called forth a large amount of controversy and controversial literature on the rights of kings and subjects, on the origin of government, on the point at which, if any, rebellion is justifiable, and other kindred topics. Not only did the press teem with pamphlets on these subjects, but, for three-quarters of a century, they were constantly being discussed and re-discussed with a dreary monotony in Parliament, in the pulpits, in the courts of law, and in the intercourse of private society. It is no part of my plan to give any account of these disputes, except so far as they bear immediately on the publication of Locke's treatises. It is enough, therefore, to state that the despotic and absolutist side in the controversy had been, or was supposed to have been, considerably re-inforced by the appearance in 1680 of a posthumous work, which had been circulated only in manuscript during its author's lifetime, entitled Patriarcha, or the Natural Power of Kings, by Sir Robert Filmer. This curious book (a more correct edition of which was published by Edmund Bohun in 1685) grounds the rights of kings on the patriarchal authority of Adam and his successors. Adam had received directly from God (such was the theory) absolute dominion over Eve and all his children and their posterity, to the most remote generations. This dominion, which rested on two independent grounds, paternity and right of property, was transmitted by Adam to his heirs, and is at once the justification of the various sovereignties now exercised by kings over their subjects, and a reason against any limitation of their authority or any questioning of their titles. By what ingenious contrivances the two links of the chain—Adam and the several monarchs now actually reigning on the earth—are brought together, those curious in such speculations may find by duly consulting the pages of Sir Robert Filmer's work.

Such a tissue of contradictions, assumptions, and absurdities as is presented by this book (which, however, contains one grain of truth, namely, that all political power has, historically, its ultimate origin in the dominion exercised by the head of the family or tribe) might have been left, one would think, without any serious answer. But we must recollect that at that time theological arguments were introduced into all the provinces of thought, and that any reason, which by any supposition could be connected with the authority of Scripture, was certain to exercise considerable influence over a vast number of minds. Any way, the book was celebrated and influential enough to merit, in Locke's judgment, a detailed answer. This answer was given in due form, step by step, in the former of Locke's two Treatises, which appears to have been written between 1680 and 1685, as the Edition of the Patriarcha quoted is invariably that of 1680. I do not propose to follow him through his various arguments and criticisms, many of which, as will readily be supposed, are acute and sagacious enough. Most modern readers will be of opinion that one of his questions might alone have sufficed to spare him any further concern, namely, Where is Adam's heir now to be found? If he could be shown, and his title indubitably proved, the subsequent question of his rights and prerogatives might then, perhaps, be profitably discussed.

Of incomparably more importance and interest than the former treatise is the latter, in which Locke sets forth his own theory concerning "the true original, extent, and end of Civil Government." Mr. Fox Bourne is probably correct in referring the date of the composition of this treatise to the time immediately preceding and concurrent with the English Revolution, that is to say, to the closing period of Locke's stay in Holland. The work, especially in the later chapters, bears the marks of passion, as if written in the midst of a great political struggle, and, in the Preface to the two Treatises, it is distinctly stated to be the author's object "to establish the throne of our great restorer, our present King William, and to justify to the world the people of England, whose love of their just and natural rights saved the nation when it was on the very brink of slavery and ruin."

The theories advanced by Locke on the origin and nature of civil society have much in common with those of Puffendorf and Hooker, the latter of whom is constantly quoted in the foot-notes. After some preliminary speculations on the "state of nature," he determines that Political Society originates solely in the individual consents of those who constitute it. This consent, however, may be signified either expressly or tacitly, and the tacit consent "reaches as far as the very being of any one within the territories of that government."

Though no man need enter a political society against his will, yet when, by consent given either expressly or tacitly, he has entered it, he must submit to the form of government established by the majority. There is, however, one form of government which it is not competent even to the majority to establish, and that is Absolute Monarchy, this being "inconsistent with civil society, and so being no form of government at all." Locke ridicules the idea that men would ever voluntarily have erected over themselves such an authority, "as if, when men quitting the state of nature entered into society, they agreed that all of them but one should be under the restraint of laws, but that he should still retain all the liberty of the state of nature, increased with power and made licentious by impunity. This is to think that men are so foolish, that they take care to avoid what mischiefs may be done them by pole-cats or foxes, but are content, nay, think it safety, to be devoured by lions." In these and some of the following strictures, he seems to have in view not only the ruder theories of Filmer and the absolutist divines, but also the more philosophical system of Hobbes.

But, supposing a government other than an Absolute Monarchy to have been established, are there any acts or omissions by which it can forfeit the allegiance of its subjects? To answer this question, we must look to the ends of political society and government. Now the great and chief end which men propose to themselves, when they unite into commonwealths, is "the mutual preservation of their lives, liberties, and estates, which I call by the general name, property." A government, therefore, which neglects to secure this end, and still more a government which itself invades the rights of its subjects, is guilty of a breach of trust, and consequently may be lawfully set aside, whenever an opportunity occurs. Hence the community itself must always be regarded as the supreme authority, in abeyance, indeed, while its fiduciary properly and faithfully executes the powers entrusted to him, but ever ready to intervene when he misuses or betrays the trust reposed in him.

On such a theory, it may be objected, of the relations of the people to the government, what is to prevent incessant disturbance and repeated revolutions? Locke relies on the inertia of mankind. Moreover, as he says, with considerable truth, in a previous passage, whatever theories may be propounded, or whatever traditions may have been handed down, as to the origin, nature, and extent of government, a people, which knows itself to be rendered miserable by the faults of its rulers and which sees any chance of bettering its condition, will not be deterred from attempting to throw off a yoke which has become intolerable. "When the people are made miserable, and find themselves exposed to the ill-usage of arbitrary power, cry up their governors, as much as you will, for sons of Jupiter; let them be sacred and divine, descended or authorized from heaven; give them out for whom or what you please, the same will happen. The people generally ill-treated, and contrary to right, will be ready upon any occasion to ease themselves of a burden that sits heavy upon them."

But, though there is much truth in this last remark, there can be little question that absolutist theories of government, especially when clothed with a religious sanction which appeals to the beliefs of the people at large, have much influence in protecting the person of an absolute ruler, as well as in ensuring the execution of his orders; while, on the other hand, theories like those of Locke have a tendency to encourage criticism, and to weaken many of the motives which have usually prevented men from offering resistance to the established government. The practical consequences of Locke's theories, as reproduced and improved on by later writers, would probably be found, if we could trace them, to be represented, in no inconsiderable degree, in the French and American revolutions which occurred about a century after the publication of the Treatises. Nor have his speculations been without their share, probably, in determining much of the political history and still more of the political sentiment of our own country. To maintain that kings have a divine right to misgovern their subjects, or to deny that the people are, in the last resort, the supreme arbiters of the fate of their rulers, are paradoxes which, to Englishmen of our generation, would appear not so much dangerous as foolish. This altered state of sentiment, and the good fruit it has borne in the improved relations between the Legislature and the People, the Crown and the Parliament, may, without undue partiality, be ascribed, at least in some measure, to the generous spirit of liberty which warms our author's pages, and to the Whig tradition which so long cherished his doctrines, till at last they became the common heritage of the English people.

Admirable, however, as, in most respects, are the parts of Locke's treatise which discuss the present relations of governors and governed, his conception of the remote origin of political society is radically false. "The first framers of the government," "the original frame of the government" (ch. xiii.), have never had any existence except in the minds of jurists and publicists. In the primitive stages of human development, governments, like languages, are not made; they grow. The observation of primitive communities still existing, combined with the more intelligent study of ancient history, has led recent writers to adopt a wholly different view of the origin of government (the question of the respective rights of governors and governed is not affected) from that which prevailed in the times of Hobbes, Locke, and Rousseau. The family or the tribe (according to different theories) is the original unit of society. Government, therefore, of some kind or other must always have existed, and the "state of nature" is a mere fiction. In course of time, the family or the tribe, by a natural process of development, would, in many cases, become greatly enlarged, or combine with other units like itself. Out of this growth or aggregation would arise, in most cases gradually and insensibly, the nation or state as known to later history. The constitution, the "frame of government," has generally passed through stages similar to those passed through by the state or nation. A body of custom must gradually have grown up even in the most primitive societies. The "customs" would be interpreted and so administered by the house-father or head of the tribe. But, as the family or tribe changed its abode, or had to carry on its existence under different circumstances, or became enlarged, or combined with other families or tribes, the customs would necessarily be modified, often insensibly and unconsciously. Moreover, the house-father or head of the tribe might be compelled or might find it expedient to act in concert with others, either as equals or subordinates, in interpreting the customs, in taking measures of defence, in directing military operations, or in providing for the various exigencies of the common life. Here there is no formal assent of the governed to the acts of the governors, in our sense of those terms, though, undoubtedly, the whole family or tribe, or its stronger members, might on rare occasions substitute one head for another; no passage from the "state of nature" to political society; no definitely constituted "frame of government." At a further stage, no doubt, political constitutions were discussed and framed, but this stage was long posterior to the period in the progress of society at which men are supposed to have quitted the state of nature, selected their form of government, and entered into an express contract with one another to obey and maintain it. The fault of Locke, like that of the other political speculators of the seventeenth and eighteenth centuries, consisted in assuming that primitive man was impelled by the same motives, and acted in the same manner and with the same deliberate design, as the men of his own generation. As in morals and psychology, so in politics, the historical and comparative methods, so familiar to recent investigators, were as yet hardly known.

I ought not to dismiss this book without noticing Locke's remarks on the necessity of Parliamentary Reform. "To what gross absurdities the following of custom, when reason has left it, may lead, we may be satisfied when we see the bare name of a town, of which there remains not so much as the ruins, where scarce so much housing as a sheepcote or more inhabitants than a shepherd is to be found, sends as many representatives to the grand assembly of law-makers as a whole county numerous in people and powerful in riches."

The writings of Locke on Trade and Finance are chiefly interesting to us on account of the place which they occupy in the History of Political Economy. They consist of three tracts, the occasions and consequences of which have already been described. The main positions which he endeavours to establish are three. First, interest, or the price of the hire of money, cannot, ordinarily speaking, be regulated by law, and, if it could so be regulated, its reduction below the natural or market rate would be injurious to the interests of the public. Secondly, as silver and gold are commodities not differing intrinsically in their nature from other commodities, it is impossible by arbitrary acts of the Government to raise the value of silver and gold coins. You may, indeed, enjoin by Act of Parliament that sixpence shall henceforth be called a shilling, but, all the same, it will only continue to purchase six-penny-worth of goods. You will soon find that the new shilling is only as effective in the market as the old sixpence, and hence, if the Government has taken the difference, it has simply robbed its subjects to that amount. The third position, which he only maintains incidentally in discussing the other two, is that the commercial prosperity of a country is to be measured by the excess of its exports over its imports, or, as the phrase then went, by the balance of trade. The two former of these propositions are simple, but long-disputed, economical truths. The latter is an obstinate and specious economical fallacy.

To understand Locke's contention on the first point, it must be borne in mind that in his time, and down even to the middle of the present reign, the maximum rate of interest allowable in all ordinary transactions was fixed by law. By the statute 12 Car. II. (passed in 1660) it had been reduced from eight to six per cent. Sir Josiah Child, whose Observations concerning Trade had been reprinted in 1690, and who probably represented a very large amount of mercantile opinion, advocated its further reduction to four per cent. He maintained, quoting the example of Holland, that low interest is the cause of national wealth, and that, consequently, to lower the legal rate of interest would be to take a speedy and simple method of making the country richer. Against this proposal Locke argued that the example of Holland was entirely beside the question; that the low rate of interest in that country was owing to the abundance of ready money which it had formerly enjoyed, and not to any legal restrictions; nay, in the States there was no law limiting the rate of interest at all, every one being free to hire out his money for anything he could get for it, and the courts enforcing the bargain. But, further, suppose the proposed law to be enacted; what would be the consequences? It would be certain to be evaded, while, at the same time, it would hamper trade, by increasing the difficulty of borrowing and lending. Rather than lend at a low rate of interest, many men would hoard, and, consequently, much of the money which would otherwise find its way into trade would be intercepted, and the commerce of the country be proportionately lessened. Excellent as most of these arguments are, Locke unfortunately stopped short of the legitimate conclusion to be drawn from them. He did not propose, as he should have done, to sweep away the usury laws altogether, but simply to maintain the existing law fixing the maximum of interest at six per cent. Sir Dudley North, in his admirable pamphlet, Discourses on Trade, published in 1691, just before the publication of the Considerations, but too late, perhaps, to have been seen by Locke, takes a much more consistent view as to the expediency of legal restrictions on the rate of interest. "As touching interest of money, he is clear that it should be left freely to the market, and not be restrained by law." Notwithstanding the opposition of men like North and Locke, to whom may be added an earlier writer, Sir William Petty, the arguments of Child partially triumphed in the next reign. By the 12th of Anne, the legal rate of interest was reduced to five per cent., and so continued till the Act of 1854, repealing, with regard to all future transactions, the existing Usury Laws. There can be little doubt that public opinion had been prepared for this measure mainly through the publication of Bentham's powerful Defence of Usury, the telling arguments of which had gradually impressed themselves on the minds of statesmen and economists. Adam Smith, on the other hand, had stopped just where Locke did. "The legal rate of interest, though it ought to be somewhat above, ought not to be much above the lowest market rate." That the rate of interest, whatever it may be, should be fixed by law, he appears to take for granted. Indeed, he seems to write more confidently on this point than Locke had done, and, in this particular at least, appears to be of opinion that the legislator can look after the private interests of individuals better than they can look after their own. Happily, as Bentham points out, the refutation of this paradox was to be found in the general drift and spirit of his work.

On the second question, "raising the value of money," Locke's views are much clearer and more consistent than on the first. It would be impossible to state more explicitly than he has done the sound economical dictum that gold and silver are simply commodities, not differing essentially from other commodities, and that the government stamp upon them, whereby they become coin, cannot materially raise their value. As most of my readers are aware, it has been a favourite device, time out of mind, of unprincipled and impecunious governments to raise the denomination of the coin, or to put a smaller quantity of the precious metals in coins retaining the old denomination, with the view of recruiting an impoverished exchequer. There have, doubtless, been financiers unintelligent enough to suppose that this expedient might enrich the government, while it did no harm to the people. But it requires only a slight amount of reflection to see that all creditors are defrauded exactly in the same proportion as that in which the coin is debased. One lucid passage from Locke's answer to Lowndes may suffice to show the forcible manner in which he presents this truth:

"Raising of coin is but a specious word to deceive the unwary. It only gives the usual denomination of a greater quantity of silver to a less (v. g., calling four grains of silver a penny to-day, when five grains of silver made a penny yesterday), but adds no worth or real value to the silver coin, to make amends for its want of silver. That is impossible to be done. For it is only the quantity of silver in it that is, and eternally will be, the measure of its value. One may as rationally hope to lengthen a foot, by dividing it into fifteen parts instead of twelve and calling them inches, as to increase the value of silver that is in a shilling, by dividing it into fifteen parts instead of twelve and calling them pence. This is all that is done when a shilling is raised from twelve to fifteen pence."

Lowndes had maintained that "raising the coin," in addition to making up the loss caused by calling in the clipped money, and other advantages, would increase the circulating medium of the country, and so put a stop to the multiplication of hazardous paper-credit and the inconveniences of bartering. Nothing could be better than Locke's reply:

"Just as the boy cut his leather into five quarters (as he called them) to cover his ball, when cut into four quarters it fell short, but, after all his pains, as much of his ball lay bare as before; if the quantity of coined silver employed in England fall short, the arbitrary denomination of a greater number of pence given to it, or, which is all one, to the several coined pieces of it, will not make it commensurate to the size of our trade or the greatness of our occasions. This is as certain as that, if the quantity of a board which is to stop a leak of a ship fifteen inches square, be but twelve inches square, it will not be made to do it by being measured by a foot that is divided into fifteen inches, instead of twelve, and so having a larger tale or number of inches in denomination given to it."

The general principle that to depreciate the coinage is to rob the creditor, and that, though you may change the name, you cannot change the thing, was quite as emphatically stated by Petty and North as by Locke. But the value of Locke's tracts consisted in their amplitude of argument and illustration, which left to the unprejudiced reader no alternative but to accept their conclusion. As he himself said in a letter to Molyneux, "Lay by the arbitrary names of pence and shillings, and consider and speak of it as grains and ounces of silver, and 'tis as easy as telling of twenty."

Locke had the penetration to see that the laws existing in his time against the exportation of gold and silver coin must necessarily be futile, and, while it was permitted to export bullion, could answer no conceivable purpose. These laws, which date from the time of Edward the Third, were, curiously enough, not repealed till the year 1819, though as early as the time of the Restoration they had been pronounced by so competent a judge as Sir William Petty to be "nugatory" and "impracticable." Nothing, as Locke says towards the conclusion of his answer to Lowndes, could prevent the exportation of silver and gold in payment of debts contracted beyond the seas, and it could "be no odds to England whether it was carried out in specie or when melted down into bullion." But the principle on which the prohibition of exporting gold and silver coin ultimately rested seems to have been accepted by him as unhesitatingly as it was by almost all the other economists of the time. That principle was that the wealth of a nation is to be measured by the amount of gold and silver in its possession, this amount depending on the ratio of the value of the exports to that of the imports. When the value of the exports exceeded that of the imports, the Balance of Trade, as it was called, was said to be in favour of a country; when, on the other hand, the value of the imports exceeded that of the exports, the Balance of Trade was said to be against it. A favourable balance, it was assumed, must necessarily increase the amount of gold and silver in the country, while an unfavourable balance must necessarily diminish it. And, lastly, the amount of gold and silver in its possession was the measure of a nation's wealth. These views form part of what political economists call the Mercantile Theory, which it was the peculiar glory of Adam Smith to demolish.

It is somewhat humiliating to the biographer of Locke to be obliged to confess that, in this respect, his theories on trade lag considerably behind those of an almost contemporary writer, Sir Dudley North, whose work has already been mentioned. Some of North's maxims are worthy of Adam Smith, and one wonders that, when once enunciated, they found so little currency, and were so completely ignored in both the literature and the legislation of the time. Here are a few, but the whole tract may be read in less than an hour: "The whole world, as to trade, is but as one nation or people, and therein nations are as persons." "The loss of a trade with one nation is not that only, separately considered, but so much of the trade of the world rescinded and lost, for all is combined together." "No laws can set prices in trade, the rates of which must and will make themselves; but, when such laws do happen to lay any hold, it is so much impediment to trade, and therefore prejudicial." "No man is richer for having his estate all in money, plate, &c., lying by him, but, on the contrary, he is for that reason the poorer. That man is richest whose estate is in a growing condition, either in land at farm, money at interest, or goods in trade." "Money exported in trade is an increase to the wealth of the nation; but spent in war and payments abroad, is so much impoverishment." "We may labour to hedge in the Cuckoo, but in vain; for no people ever yet grew rich by policies, but it is peace, industry, and freedom that brings trade and wealth, and nothing else."

Some of Locke's opinions on trade and finance were undoubtedly erroneous, and it must be confessed that the little tract of Sir Dudley North supplies a better summary of sound economical doctrine than any which we can find in his writings; but then this brochure is merely a summary, with little of argument or elucidation, and perhaps it would be difficult to point to any previous or contemporary writer whose works are, on the whole, more important in the history of economical science than those of Locke.