The Mercantile System's Hidden Costs — The Wealth of Nations

Smith closes his attack on the mercantile system by showing how its rules flip when manufacturers lobby harder. The system normally pushes exports and blocks imports. But when makers want cheap raw materials at home, government blocks export of wool, tools, and other inputs while encouraging import of materials they use.

The stated goal never changes: enrich the nation through trade surplus. The real goal is whatever helps the loudest factory owners. Consumers and farmers pay through higher prices, scarcer materials, and laws written for producers, not for the public. Instrument import prohibitions complete the picture: tools that would help workers are blocked once domestic toolmakers exist, while semi-finished imports that undercut spinners are welcomed. Sheep's wool, cotton, flax, hides, and bar iron entered duty free when masters bought them, while growers could not export fleece to bid up local price.