Statement
of Some
New Principles
on the Subject of
Political Economy,
Exposing the Fallacies of the System of
Free Trade,
And of some other Doctrines maintained
in the "Wealth of Nations"
by John Rae
When we reason upon general subjects, one may justly affirm, that our speculations can scarce ever be too fine, provided they be just. - Hume, Essay on Commerce.
Entered according to the act of Congress in the year 1834,
by HILLIARD, GRAY, & Co.
in the Clerk's Office of the District Court of the District of Massachusetts
PREFACE.
[The work here presented to the American reader, was composed with the intention of being published in Great Britain; under this idea the following Preface was written. As it explains the design of the original undertaking, It has been thought proper that it should retain the place it was at first intended, to occupy.]
To promote prosperity within, to guard against danger from without, have ever been esteemed the two great branches of the duty of the Statesman. But of all the sources of internal prosperity, or means of repelling external aggressions, no one, in modern times, is of greater efficacy than wealth. We have, therefore, no reason to be surprised, that statesmen should have endeavored to procure for their respective countries the greatest possible amount of it. If the laws they have enacted, and the regulations they have for this purpose established, have really answered the ends they were intended to promote, they are certainly praiseworthy.
Of the efficacy of such laws, for those purposes, politicians for a long time did not doubt; but a great revolution in public opinion has taken place, and almost all men who now pretend to understand the principles that should govern the policy of nations, agree in condemning them.
This revolution in the opinions of men, had its rise in France. It might have died there, however, with the sect from which it had birth, had not a man of surprising genius, placing himself at the head of the feeble party then supporting it, enabling them to give their principles currency throughout the nations of Europe, Adam Smith will be recorded among remote generations, as one having powerfully influenced the opinions and policy of the civilized world, during the eighteenth and nineteenth centuries. His great work no sooner appeared in Britain than it was read, and the opinions it maintained adopted, by every one who pretended to any knowledge of the important subjects of which it treated. It quickly, and with like success, spread through other lands. Never was the force which mere intellect possesses more strikingly manifested. To illustrate his speculations, to cast them into new forms suited to the varied tastes of various nations, became an employment by which men of undoubted genius thought themselves honored. His reasonings are the basis of numerous systems and innumerable essays. A voluminous library might be formed of the works of men who call him master. Nor were the dicta of a retired student acquiesced in, and embraced, only by theorists like himself. They have guided the councils, they have formed the text book of statesmen, and have had an important influence on the policy of nations.
Against doctrines supported by so great a weight of authority, what, it may be demanded, can possibly be urged? and how comes it, that so obscure an individual as the author of the following pages, places himself in opposition to them? Custom authorises me,in a measure calls on me, in answer to these questions, to state to the reader how I was led to form opinions opposed to this system, and why I bring those opinions before him.
Many years ago, I became engaged in a series of inquiries into the circumstances which have governed the history of man, or, to vary the expression, into the causes which have made him what he is in various countries, or has been in various times. It seemed to me, that, by gathering together all that consciousness makes known to us of what is within, and all that observation informs us of what lies without, the real agents in the production of the great events by which the fortunes of our race have been diversified, might be at least partially discovered, the laws regulating their procedure traced, and that thus the materials for a true Natural History of man might be reached. The pursuits in which I was engaged led me to the subject on the side of physiology, and what `is termed metaphysics, and imagining that I saw a ray of light struggling through the obscurity of the objects, amidst which these investigations placed me, I began to conceive hopes of being able to dispel some of the darkness, in which are involved causes that have produced, and are producing, results of the highest importance to us. To this pursuit I determined to devote myself. Such a resolution would scarcely have been taken by any one unless prompted by the enthusiasm natural to youth, and would not have been adopted by me, had I not had the prospect of enjoying every facility in following out the objects I had in view; but a sudden and unexpected change took place in my circumstances, and I exchanged the literary leisure of Europe for the solitude and labors of the Canadian backwoods. I found, notwithstanding, that this accident could not altogether put a stop to my inquiries, though it retarded them and altered their form.
I had early turned for assistance to the Inquiry into the nature and Causes of the Wealth of Nations, and to the speculations of the political economists. But, I found their scope and design too confined, to advance the attainment of my purpose in the degree I had anticipated, and I had besides the mortification of perceiving, that the conclusions to which they led, were, in many points, opposed to those at which I had arrived. Encountering opposition where I had looked for support, I applied myself to ascertain, if possible, the cause, and, after having spent considerable time in the inquiry, conceived I had detected enough of fallacy in the speculations, even of Adam Smith himself, but more especially of his successors, to warrant the belief that my conclusions might be right, though the practical rules that might be deduced from them, would not coincide with those laid down in what is termed the science of political economy. But, though I became satisfied on this head, it was not my intention to have directly attacked any of the tenets of the school. Setting out from a new point, it seemed to me, that, however far I might advance, it would not be necessary for me directly to oppose, or to attempt to controvert, any received opinions.
During my residence in this country, the field of my inquiries being much contracted, I again recurred to the disquisitions of Adam Smith, and of other European writers of the same school, in order to trace out more fully than I had hitherto done, the connexion between the phenomena attending the increase and diminution of wealth, and those general principles of the nature of man, and of the world, determining, as I conceive, the whole progress of human affairs. Though I was led to this study, simply from my desire to advance, as far as my situation permitted me, in a path of investigation which had, to me, a very lively interest, my prosecution of it had the effect of impressing me more deeply with a conviction of the unsoundness of the system maintained in the Wealth of Nations.
In this stage of my progress I became engaged in a work on the present state of Canada, and oh its relations with the rest of the British Empire. These relations seem to me to spring from the mutual benefit arising to the colony and the empire from their connexion. The sect of politicians, to whom I allude, deny that any such benefit arises to either party. Were their reasonings correct, it would follow as a necessary consequence, that Canada is, in this respect, of no advantage to Great Britain, and would go far to prove, what, indeed, seems by many to be believed, that the sooner the connexion between them is dissolved the better.
Dissenting as I do, from the opinions of these theorists, it appeared to me, that the work I had undertaken required me to state some of the reasons on which I grounded this dissent, and that, without entering at length into any of the important questions involved in the discussion, I should be able at least to cast a shade of doubt over doctrines asserted with great dogmatism, and acted on with unhesitating confidence. In endeavoring, however, for this purpose, to arrange a series of arguments drawn from a modification of principles that originally suggested themselves to me when engaged in more enlarged inquiries, my work gradually assumed a far more extended and systematic form, than I had at first meditated, and I became engaged in the present attempt, to show that there exist great and radical errors in the whole system, sufficient to vitiate very many of the conclusions drawn from it, and from the fallacies introduced by which, the doctrines of free trade alone derive their plausibility.
In the prosecution of the argument, I have almost entirely confined myself to the consideration of the doctrines to which I am opposed, as they are developed in the Wealth of Nations. I could not have done otherwise, without becoming involved in the discussion of contradictory and conflicting opinions. Neither, as I conceive, is this limitation of essential importance to the determination of the points in debate. If Adam Smith be essentially wrong, none of his followers can be right. The system established by him stands, or falls, with him.
I am not ignorant of the dangers to which this attempt subjects me. Whoever ventures to attack a system received so generally, and supported by so great a weight of authority, is exposed to various evils. They who have embraced its principles are apt to slight and neglect, or, if that may not he, to conceive it their business to overthrow the heterodox doctrines. What of error they may contain is eagerly seized on, what of truth, is overlooked. "Who," asks Mr. Locke, "is there, hardy enough to contend with the reproach which is ever prepared for him, who dares venture to dissent from the received opinions of his country and party? And where is the man to be found, that can patiently prepare himself to bear the names, that he is sure to meet with, who doth in the least scruple any of the common opinions?" Though many things are altered since the days of Locke, mankind are but little changed. In his days, indeed, the prejudices of the times ran towards opinions, which, acquiesed in by many succeeding generations, were, therefore, conceived to have a real plurality of judgments in their favor. Now, on the contrary, to have been believed from of old, is deemed to indicate defect, and that alone is admitted as of approved strength, which has not been subjected to the test of time. In this, nevertheless, there is a perfect agreement, that men appeal not so much to truth itself, as to prevalent opinion, and are disposed to treat whatever stands opposed to it, as necessarily erroneous. It were, then, in vain for me, I am aware, in reply to the charge of presumption in challenging the opinions to which the celebrated author of the Wealth of Nations has given currency, to answer, that it is not so, and that, on the contrary, "he is the general challenger:" that his disciples form, in reality, but a sect, one setting itself in opposition to the belief of all preceding ages, and in its rise and progress presenting nothing dissimilar to the other numerous sects, which time, in its course, has seen appearing and disappearing: that, therefore, if we really appeal to authority, its decision is against, not for, the present political creed. Such arguments would certainly fall on deaf ears. The authority, in which men acquiese, is that which is present, and to which they have been accustomed to yield assent. Whatever is opposed to this, and separated from it by distance of time or space, has no influence on their judgments.
But, although, instead of assistance, I have to look for opposition, from this quarter, I nevertheless believe, that I have an auxiliary of great power on my side. In political questions, before they see that they are wrong, it is common for men to feel that they are so. The progress of recent events seems to have excited a general sensation of this sort over Great Britain. Twenty or thirty years ago, according to the prevailing political system, every circumstance in the condition of the empire was at variance with what should give prosperity to a state. To meet the enormous annual expenditure occasioned by the most wasteful of all preceding wars, a revenue as enormous was drawn by taxation from the people, while, instead of their industry enjoying the boasted advantages of perfect freedom, at home it was restrained by regulations of old established, and abroad its products were legally shut out from every continental port, and could only any where force an entrance with much hazard, and at heavy expense.
True; making its power felt through the element that had ever been most propitious to it, it had subjugated almost every spot on the globe, colonized by Europeans, and by this means, in defiance of its enemies, maintained an extended commerce with all parts of the world. But this vast extent of empire, preserved by force of arms, and at great expense, according to the dicta of modern politicians, was an evil of the greatest magnitude, and one which, though the burden attending it is now reduced to comparative insignificance, they are continually assuring us we ought, as quickly as possible, to get rid of.
Notwithstanding all these disadvantages, however, there is no period in its history in which the condition of Great Britain was apparently more flourishing. The exertions of the laborer were liberally rewarded, the expenditure of the capitalist richly repaid. Every thing gave token of rapidly increasing wealth and abundance.
The triumph of that cause, in aid of which war had been embraced, gave peace to the empire and to Europe. The annual expenditure was diminished by one half, and the nation was no longer restrained, but in comparatively a very trifling degree, from participating in all those advantages, which, in every instance, one country, according to prevailing notions, is supposed to gain by free intercourse with another. But, though markets for the manufacture, and channels for the commerce of the kingdom were largely multiplied, its resources, instead of augmenting, seemed diminishing. The whole fabric of society seemed ready to sink under the pressure of some new burden,ruin began to threaten, often to overwhelm the man of capital,want to look industry in the face. In vain were taxes to a large amount repealed, in vain were endeavors made to trace the depression of the times to mere revolutions in the channels of trade, and to other temporary causes, and hopes held out that they would speedily pass away. The evil proved to be not partial and temporary, but pervading and permanent. Far from confidence in the modern science being shaken by a result contrary to all its principles, it was resolved to seek a remedy for the acknowledged distress, by adopting largely the policy which this science inculcates.
It cannot be denied that the results of the experiment, as far as it has hitherto been carried, have been in the whole, unhappy. The events which have followed, not to say flowed from recent enactments, regulating the internal and external commerce of the nation, have been at least unfortunate. The operations of the banking system, and the extension of general confidence and security in all transactions, which that system is calculated to afford, seem clogged and restrained. The returns which industry and capital receive, have been still farther diminished. Wealth is barren. Labor, plied with all the skill, and more than all the assiduity to which human nature is long adequate, does not always keep famine at a distance.
It is natural that these circumstances should beget a sort of feeling of doubt. That, without pretending to question the general truth of the system established by Adam Smith, many should yet ask themselves, is the path which he has pointed out, truly that which always leads directly to the wealth of nations? In this temper of the public mind, I am inclined to hope that the application of new principles to a reconsideration of the whole subject, may be conceived to be an undertaking deserving, at least of being examined, and that the defects of the following pages may not be thought sufficient to prevent what measure of truth they may contain, from being perceived and appreciated. MONTREAL, 1833.
POSTSCRIPT.
In the preceding pages, the reader has an explanation of the original design of the work which I venture to place before him; but, in preparing it for publication in this country, I have made some alterations in it, the nature of which it is proper I should here state.
The doctrines which Adam Smith maintained with so much ability, never took so deep hold in this country as in England, and they have been more strongly opposed. There is, hence, a very considerable difference between the state of public sentiment in Great Britain and America, concerning the most interesting practical questions of political economy. This is especially the case with regard to the policy of the protective system. The practical bearings of that system on the condition of things in this republic, have been discussed so often, and with so much ability, that probably few new arguments or facts concerning it can be brought forward by any one, least of all can they be expected from a foreigner. Although, therefore, I look on the effects of the policy pursued by the legislature of the United States, as affording the best practical illustration hitherto existing of the correctness of some of the principles I maintain, I have scarcely at all referred to them for that purpose, but have contented myself with showing how the benefits resulting from the operations of the legislature, in this and in other similar cases, are to be accounted for. I have thus omitted much matter that would have appeared, had the work been published in England, but which, it seemed to me, would be at least superfluous here. These omissions occur in the third book, which is consequently much abridged.
To the second book I have made some additions, having given fuller development to the principles there explained, and traced their connexion with events at greater length, than is necessary for the mere purpose of exposing the fallacies of the theoretical views, the refutation of which was originally my sole design. As the additions were made in the progress of the work through the press, in one or two instances I have been led to refer to subjects to be afterwards treated of, which I found it impossible to comprise within such limits as would admit of their insertion. These omissions, however, do not occasion any break in the chain of reasoning. There are, also, some topics, which, though I have introduced, I have but partially discussed, and merely so far as may serve to show some of their connexions with principles expounded. The most important of these is the subject of banking.
Boston, 1834.
INTRODUCTION.
Of all the circumstances connected with the "Inquiry into the Wealth of Nations," there is no one more remarkable than the fact, that its celebrated author leaves us in doubt what he himself understands by that wealth, the nature and causes of which it is the object of his inquiry to investigate. His followers have scarce been more fortunate. They have sought, by definitions, to remedy the acknowledged defect, but have been unable to agree in the terms of them. The school is thus split into many little sects at variance with each other regarding the very elements of the science.(1)
It seems to me that this circumstance arises from, and very clearly marks the existence of, a great and fundamental defect in the principles of investigation on which Adam Smith and the school he founded proceed ; an uniform tendency to hold that up as an explanation of other things, which, in reality, is the very thing itself to be explained.
It is the nature of wealth in the general, and the laws regulating its increase and diminution, that can alone, as I conceive, form the proper subject of philosophical investigation. These being determined, from them may be deduced the manner in which particular societies, or particular individuals, come to possess this or that amount of wealth. But, though such is the proper philosophical view of the subject, it is not that under which it appears to common observers.
Before men begin to speculate, they are obliged to act. They are therefore first led, in regard to any system with which they have to do, to fix their attention altogether on the phenomena exhibited by it, without attempting to reach the causes of those phenomena. It is usually long after the events themselves have thus been observed and noted, that to trace their causes becomes the employment of philosophers. The mere sailor, for example, regards the winds simply as connected with the different seasons, the various regions of the globe, and the particular aspect of the heavens at the time. This makes up the sum of his knowledge concerning them, which, notwithstanding, may be very extensive and of great practical utility. It is not his object to inquire into the general causes producing all these phenomena, nor into the laws regulating the general system of things, of which they make a part, and so of ascertaining the true nature of the different winds, the real manner of their existence, and the measure of their force and duration. He believes that while that system endures as it is, his knowledge will serve to direct his practice, and this is all about which he concerns himself. An extensive practical knowledge of this sort here long preceded a philosophical knowledge of the subject. It has been the business of the latter, as it has at last had place, to ascertain the nature of wind itself, and the causes producing all different winds, and acting on them. For this purpose the philosopher has turned himself to the investigation of whatever, in the general system of things, is connected with that concerning which he inquires; to the constitution and properties of the atmosphere; the effects of changes of temperature on aeriform fluids; the motions induced by these, by the rotatory movement of the globe, and by other circumstances. From them he deduces the true theory of wind, and shows that it is in accordance with the observations and rules of him, who has been accustomed to view the subject in its practical bearings alone, and tends to elucidate and simplify them.
In a somewhat similar manner wealth was felt and noted in its effects long before, as a circumstance largely affecting societies, it was proposed philosophically to investigate its nature and causes. To mark those effects, riches and a series of other terms of the sort, were invented. Like all every-day words and phrases they apply to particular facts and occurrences, and have no necessary reference to the causes of those facts and occurrences. All such speculations are foreign to mere practice, and never enter even into the explanations and reasonings of the merely practical man. However complicated the social system of which any person engaged in the acquisition of wealth makes a part, he has no difficulty in tracing the manner in which that portion of it which he possesses has been acquired, nor in explaining how it forms to him a certain amount of what he calls capital. But in giving this explanation, it will be observed that for the elements of his statements, he has always recourse to the existence and continuance of certain circumstances and regular trains of events in the general system of human society. What the things may be which give origin and regular succession to these events is a speculation lying out of his road, and on which he probably never enters. Though, therefore, he can easily tell how he got that which constitutes his wealth, and how to him it comes to be wealth, he will yet probably confess that he is unable to say what constitutes wealth in general, from whence it is derived, or what are the exact laws regulating its increase or diminution. These are questions of which the solution is very clearly shown to be of great difficulty from the mass of discordant opinions concerning them.(2)
Adam Smith, in this and in other instances, by transferring, without hesitation, terms made use of to mark and explain the affairs of common life to denote the great phenomena which the affairs of societies present, falls, as it seems to me, into two errors. In the first place, he in a great measure misses that which is the real object at which his inquiry aims, the investigation of the true nature and causes of national wealth, and shows, by holding out sometimes one notion of it and sometimes another, according to the different lights in which at different times the subject presents itself to him, that he has no very definite ideas concerning it. In the second place, he naturally, and in very many instances, falls into the error of taking, what in truth are the results of general laws governing the course of this class of events for the laws themselves, and so of elevating effects into causes. His procedure is not very dissimilar to what that of a philosopher would have been, who, desiring to investigate the nature of wind, should have assumed it as already known, not as an event, but as a thing, and should have conceived it his business merely to connect and arrange the various phenomena in relation to it, with which practice had previously made mankind familiar. Such a system could not have failed to have embodied great radical defects, for it would have been built on principles fundamentally erroneous.
His followers, by the use they make of definitions, appear to me rather to have introduced new evils, than to have applied a remedy to those already existing. Definitions give us the mastery of words, not of things,(3) and therefore by taking them as they have done, for principles of investigation, not auxiliaries to it, their labors have generally issued in adducing arguments instead of collecting and arranging facts, the former being the proper fruit of an attention to words, the latter of an inquiry into the nature of things.
I conceive that the fallacies of the particular doctrines I oppose may be most effectually exposed, by tracing out the true nature of that wealth, the manner of the augmentation and diminution of which, forms the subject of controversy. That we can neither assume this as a thing already known, nor hope, by any mere intellectual effort, to comprehend it in an ingenious definition. That when it is really discovered, it must be, as has happened in other things, that disputes concerning its manner of existence, its increase and decrease will terminate, or instead of hinging on plausible arguments, may be settled by a reference to ascertainable facts. It is, therefore, such an investigation, that I propose partially to attempt; and it is chiefly on the results of it, that I mean to rest my demonstration of the reality of those errors, my conviction of the existence of which, has been my motive for engaging in the present undertaking.
By entering on such an investigation immediately, however, the subject would be brought before the reader under an aspect so different from that in which it is viewed in the Wealth of Nations, and subsequent works following in the same train of thought, that I should not have an opportunity of directly meeting some of the arguments there advanced. For this reason I shall first endeavor to show, that even proceeding on similar principles to those adopted in the Wealth of Nations itself, there exist great and insuperable objections to the doctrines in question. This forms the subject of the First Book. In the Second, I enter on the analysis of the nature of wealth and the laws governing its increase and diminution. The Third is devoted to a practical application to the doctrines in question, of the principles established.
BOOK I.
INTRODUCTION.
When wealth, considered in the general, is conceived to be a thing either so clear as to require no definition, or so simple as to be fully grasped by any definition, two different and opposing systems naturally seem to arise concerning it.
The wealth of all the individuals in a state being, it may be said, of necessity measured by the amount of the national wealth, whatever adds to the wealth of the nation must increase the stocks of individuals. But it has always been found that nations have become most wealthy when they have engaged most extensively in commerce and manufactures. To encourage commerce and manufactures by every possible means, should, therefore, be the great aim of the legislator; and every enactment and regulation of his conducing to this effect, as it cannot but tend to the increase of the general funds, must ultimately add to the stocks of individuals. This view of the matter leads directly to a system of unceasing regulation and restraint.
Again, on the other hand, it may be said, that, as the wealth of the nation is necessarily made up of the riches of the various individuals in it, so the national wealth must grow as each individual adds to the portion of it which he possesses. But every restraint is a hindrance to a man's acquiring wealth, and he always gains by evading it. As, therefore, all interference on the part of the legislator, operates as a restraint, he never in any case ought to interfere.
As the former view of the subject produces a system of general regulation and restraint, this teaches the doctrine of complete inaction on the part of the legislator, of the removal of all restraint, and of perfect freedom of trade.
Both systems proceed on the assumption of the exact identity of public and private wealth; of Wealth, as it is the same word, being always the same thing, whether applied to individuals or communities, and being in its increase and decrease subjected in all cases to similar laws; an assumption flowing easily from the conception that its nature is very simple and may without difficulty be apprehended.
The latter of these systems, that adopted by Adam Smith, we might expect would at present, be most popular in Europe. Institutions and forms very often endure after the circumstances that had originally called them forth have disappeared, and when, consequently, their operation injuriously restrains the movements of some new order of things. Such seems the condition of most European kingdoms at present. The frame of their existing constitutions and laws was moulded in remote times, in ages of comparative barbarism and stern military rule, and is, therefore, in many pans, unsuited to the circumstances of the present period. It is perceived that a multitude of abuses exist, and the efforts of the majority are directed to detect, expose, and do away with them. The prejudices of men of liberal minds and enlarged views, for even such men have prejudices, run consequently, rather towards overthrowing and rooting out, than to establishing and maintaining. A system of political economy, the fundamental principles of which, inculcated the doctrine that every attempt of the ruler to direct the industry of the community was injurious, and that all laws having this tendency, should be abrogated, fell in with the current of public opinion and could not but draw to itself a large body of zealous and able advocates. It is in this temper that Mr. Bentham addresses its author. "On this subject you ride triumphant, and chastise the impertinence of kings and ministers with a tone of authority, which it required a courage like yours to venture upon, and a genius like yours to warrant a man to assume."(4)
It may be remarked, also, that as the circumstances of Europe, in remote ages, produced the former system, in the present give popularity to the latter; so in North America, where a new form of government suited to the state which society has there assumed, has been established, we might expect, as is the case, that a medium would be taken between the two extremes.(5)
My main object, in this book, is to show that that notion of the exact identity of the causes giving rise to individual and national wealth, on which the reasonings and arguments of Adam Smith all along depend, is erroneous, that consequently the doctrines he has engrafted on it, cannot be thus maintained, and are inconsistent with facts admitted by himself.
Chapter 1
Of the Identity of Individual Interest Considered
as a Simple Principle.
I have already observed that through every part of his work, in the conduct of all his reasons and arguments, Adam Smith blends together the consideration of the processes by which the capitals of individuals and nations are increased, and always treats of them as precisely identical. Sometimes this is assumed as a self-evident truth, sometimes it is a deduction from an ingenious theory; but, in one shape or other, it forms the basis on which his whole system is built. If this simple view of the subject be admitted as correct, it may very easily be made to lead to the conclusions at which he is desirous of arriving.
The axiom which he brings forward, that the capital of a society is the same with that of all the individuals who compose it, being granted, it follows that to increase the capitals of all the individuals in a society is to increase the general capital of the society. It seems, therefore, also to follow that as every man is best judge of is on business and of the modes in which his own capital may be augmented, so to prevent him from adopting these modes is to obstruct him in his efforts to increase his own capital, and, in so far as his capital is a part of the general capital of the society, to check the increase of that general capital; and hence, that, as all laws for the regulation of commere are in fact means by which the legislator prevents individuals conducting their business as they themselves would deem best, they must operate prejudicially on the increase of individual and so of general wealth.
In pursuance of the same idea of the perfect identity of the means by which individual and national capitals are increased, the argument is thus further enforced. Accumulation is the means by which individual capital is augmented. We know very well that if any person spend as fast as he makes, he can never get richer. Whatever his gains are he must save some part of them, else he can never add to his capital. The amount also of his savings for any period of time must measure the addition, which, during that time he makes to is wealth. As, therefore, the capital of a single individual is increased by his continually accumulating and adding to it whatever he saves out of his revenue, so the national capital, or the capital of all the individuals in a nation, is increased by these individuals continually accumulating and adding to it what they save out of their respective revenues. Hence whatever prevents them from making the most of their respective capitals, or drawing from them the largest revenue, in so far as it deprives them of the power of laying past so large a portion of that revenue as they otherwise would, must in a like proportion diminish their individual accumulations, and consequently the sum of all their accumulations, or the amount added to the national capital. But all laws for the regulation of commerce, and all encouragements given to particular branches of industry, do in fact prevent individuals from turning their capitals into the channels which, but for these regulations, they would prefer as offering the largest returns. They must, therefore, it is said, to a certain extent, diminish individual accumulation, and consequently, in an equal proportion, the increase of national capital.
Viewing, then, the subject in this simple light, and taking as undoubted truths the assumptions of our author, that individual and national wealth increase in the same manner, and that the manner in which individuals increase their riches is by saving from their revenues, we would easily arrive at the doctrine he inculcates, that as every man is best judge of his own interests, so he should be left to pursue them in is own way, without the legislator at all interfering with his operations, or pretending to aid or direct them.
This very simple view of the subject would, however, be defective in two respects.
1. Though it is, in the general, true that individuals may find some employment, by the prosecution of which they may procure a revenue, and so, by saving from this revenue, acquire wealth, or add to what they have before acquired, yet it seems not so clear that it is by this means alone that nations advance, or can advance, in the acquisition of wealth; because it must occur to us that materials on which the national industry may he employed are to be provided, and often are or may be wanting.
2. It is not altogether correct to say that the sole means, which an individual employs to add to his capital is the process of saving from revenue. It is very evident he must first gain this revenue, and that the amount he gains, and consequently the amount he can save, must in general depend on the talents and capacities he possesses for the prosecution of the particular employment to which he devotes himself. As an inquiry, therefore, into the manner in which an individual might most rapidly accumulate wealth, would in part resolve itself into an examination of the modes by which he might acquire the greatest perfection of knowledge, skill, dexterity, and other talents and capacities, tending to the successful prosecution of his business; so an inquiry into national wealth, even supposing the process by which nations and individuals add to their riches to be the same, must partly resolve itself into an examination of the modes by which the knowledge, skill, and dexterity of all the individuals in a nation, in the various businesses and professions that may be carried on in it, may be raised to the highest pitch.
These two circumstances render the subject more intricate, than the first simple view we might be inclined to take of it, would lead us to suspect. An attention to the operation of either of them will be sufficient to show that identity of the interests of individuals and states, which is assumed throughout the Wealth of Nations, is not a self-evident principle. In the following observations, I shall, however, confine myself to the former of them.
Individuals, it is very clear, in general, increase their capitals by acquiring a larger portion of the common funds. While one man is growing rich, another is becoming poor, and the change produced, seems not so much a creation of wealth, as a passage of it from one hand to another. These transfer have been going on in all ages of the world and have existed equally, in what has been called the advancing, the stationary, and the declining stages of society. Every where this means of acquiring wealth is open to individuals, and they every where avail themselves of it. Let any one in any country in Great Britain for instance, trace backwards for fifteen or twenty years the mutations that have occurred in the fortunes of the persons with whom he is acquainted, and he will find that there are few, whose circumstances are not very much changed from what they then were. Good conduct, good fortune, and frugality have made many rich who were then poor; imprudence, misfortune, prodigality have made many poor who were then rich.
But while that man has thus been adding house to house, and farm to farm, and this has been giving up one portion of property after another, till he finds all he once possessed in the hands of others, the whole mass of houses, lands and wealth, has undergone but little alteration; the national capital itself, remains, comparatively, but little changed. It is not by thus acquiring wealth previously in the possession of others, that nations enrich themselves. But a very small part of the capital of any community, can, I suspect, be accounted for, by tracing its passage from any other community. Instead of one nation growing rich, and another poor, we rather see many neighboring nations advancing at the same pace towards prosperity and affluence, or declining equally, to misery and want. As individuals seem generally to grow rich by grasping a larger and larger portion of the wealth already in existence, nations do so by the production of wealth that did not previously exist. The two processes differ in this, that the one is an acquisition, the other a creation.
Ex nihil fit. Nothing can spring out of nothing. Every thing that exists must have a cause. As we do not see that individuals increase their wealth by creating new wealth, we do not think of inquiring how the riches of an individual came to exist, but how they came into his possession. But as ve do not see how nations can increase their wealth, but by creating new wealth, we naturally inquire, what are the causes of the wealth of nations.
Adam Smith asserts, and as I think truly asserts, that these causes are to be found in the improvement of the productive powers of human labor. Men, and therefore nations, are said to be rich or poor according to the degree in which they can afford to enjoy the necessaries, conveniences, and amusements of human life. But as it is the annual labor of the nation which supplies these necessaries, conveniences and amusements; so as this labor is well or ill directed, the supply it affords must be great or small. The skill, dexterity, and judgment with which labor is applied; that is, I presume, the facility of the operations which it employs for executing its ends, and the accuracy with which it conducts them, must consequently mainly regulate the amount which it produces. Thus the increase of the skill, dexterity and judgment with which the national labor is applied, furnishes us with a cause for the increased productive powers of that labor, and so for the increase of the national wealth.
This account of matters will be found sufficiently to agree with the ideas which the contemplation of their progress forces on every one. When we are told that an individual this year employs in agriculture double the capital which he employed last year, the conception which most readily presents itself to us is, that he now farms double the land which he then farmed, owns double the number of horses, cattle, farming utensils, etc. and has double the number of barns and other necessary buildings. When we are told that a country has double the agricultural capital which it had a century ago, we cannot, of course, conceive that its farms are double the extent they then were; neither do we conceive that its farmers have simply double the number of barns and other buildings, of cattle, ploughs, harrows, and other farming utensils, which they then had. We conceive a change in the mode in which its fields are laid out and tilled; in the form and qualities of the stock; in the construction of all the implements of husbandry; in the size and arrangement of the barns and other buildings, and that through these changes the national agricultural labor produces at least double the products it formerly did. It is this change necessarily involved in our conception of the process by which nations increase their capitals, and not necessarily involved in the process by which individuals increase their capitals, that constitutes the difference between them.(6)
Though they are thus essentially different, there are nevertheless two points in which they agree. When estimated in gold, silver, or any other instrument of exchange, the sum at which the agricultural property presently possessed by the individual would be rated would be double that at which what was formerly in his possession was rated. The sum, also, at which the present agricultural property of the nation would be rated would be double that at which it was formerly rated. The things, too, that so estimated formed the increase in both, would have been produced by man: they would be his works. But though two things may both be estimated as worth a sum of money, and may both be works of man, it follows not that the principles which have produced them are perfectly similar. The poem of Children Harold cost the publisher a certain sum; so did the paper on which it was printed. They both, too, were works of man, and required mental and corporeal energy to produce them; but we should not, therefore, say the principles that produced them were precisely similar.
Within a few centuries the national capital of Great Britain has increased tenfold. Could we imagine that we could tell this fact to some one of the men of the olden time, waked from the slumber of the tomb and raised up to us, we may suppose he would ask how it could be; how there could have been produced so mighty a change; or from whence so full a tide of wealth could have flowed in upon us. But were we then to take him abroad and show him the wonders and achievements of art with which the land is overspread; the various processes carried on in our manufactories and workshops; the scientific labors of the agriculturist; the curious mechanism with which the vast bulk of our ships is put together and guided; fire and water transformed into our obedient drudges, excavating harbors and draining mines for us, carrying us over the land with the speed of the wind, bearing us through the ocean against tide and storm; he would no longer wonder whence the wealth was that he saw around, or that the land yielded tenfold what it had done of old, though he might well demand how the power had been acquired that had wrought so great a change.
Were such a thing possible as we are thus imagining we can scarce suppose that any one would be found to reply, the whole process is nothing extraordinary; it is just the same as you must have seen in your own days, when, by continual parsimonious saving, an individual accumulated ten times the capital he once had; he began, perhaps, with one house and died owing ten. Such an assertion would evidently be absurd.
Invention is the only power on earth, that can be said to create.(7)
It enters as an essential element into the process of the increase of national wealth, because that process is a creation, not an acquisition. It does not necessarily enter into the process of the increase of individual wealth, because that may be simply an acquisition, not a creation. The assumption, therefore, that the two processes are perfectly similar is incorrect, and the doctrine which I have designated as that of the identity of the interests of individuals and communities cannot be thus established.
The ends which individuals and nations pursue, are different. The object of the one is to acquire, of the other to create. The means which they employ, are also different; industry and parsimony increase the capitals of individuals; national wealth, understood in its largest and truest sense, as the wealth of all nations cannot be increased, but through the aid also of the inventive faculty. Though each member of a community may be desirous of the good of all, yet in gaining wealth, as he only seeks his own good, and as he may gain it by acquiring a portion of the wealth already in existence, it follows not that he creates wealth. The community adds to its wealth by creating wealth, and if we understand by the legislator the power acting for the community, it seems not absurd or unreasonable that he should direct part of the energies of the community towards the furtherance of this power of invention, this necessary element in the production of the wealth of nations.
In the following cases it would at least seem not improbable, that the power of the legislator so directed, might be beneficial.
I. In promoting the progress of science.
II. In promoting the progress of art.
1 . By encouraging the discovery of new arts.
2. By encouraging the discovery of improvements in the arts already practised in the country .
3. By encouraging the discovery of methods of adapting arts, already practised in other countries to the particular circumstances of the territory and community for which he legislates.
In the attainment of all these objects, the aid of the inventive faculty is required. Our judgment of their propriety or impropriety, as far as this is determined by their direct tendency to promote the wealth of the community, would seem to depend on two circumstances. 1. On the probability of their success, and of this success enabling the industry of its members to acquire with increased facility some of the necessaries, conveniences, or amusements of life, the capacity for producing which, measures the general revenue and riches. 2. On the probability of the future wealth to be derived from this new source, being sufficient to repay the expenditure of present wealth necessary to open it up.
As far as any considerations, which I have as yet presented to the reader, warrant us in forming a conclusion, it certainly does appear not impossible, or unlikely, that there might be instances in which the legislator might, with advantage to the progress of the wealth of the community, direct the energies of some of its members towards discoveries in all these different departments of knowledge and action.
But in doing so, he always acts contrary to this doctrine. It teaches that he ought never to disturb the natural course of events; that is, the course which the efforts of individuals, uninterfered with, by him, would give to these events. His agency so directed, according to this doctrine, must be injurious; because, in every instance, it in part changes the direction, and in part retards the progress of the natural course of events. In every such instance, he directs the industry of some of the members of the society from gaining a revenue by the practice of old arts and so accumulating capital, to the discovery either of materials for new arts, or of means of adapting old ones to new countries. By doing so, he takes from the national revenue, and retards, consequently, the accumulation of the national capital.
This doctrine, as given by Adam Smith, is in general, blended with theoretical principles afterwards to be considered. The following is an abstract of it, in his own words, from different parts of his system, separated from these principles.
"The capital of all the individuals in a nation is increased in the same manner as that of a single individual, by their continually accumulating and adding to it whatever they save out of their revenue.(8) As the national capital is thus increased by parsimony, so it is diminished by prodigality ad misconduct. The conduct of those whose expense just equals their revenue, without either accumulating or encroaching, neither increases nor diminishes it. It can seldom happen that the circumstances of a great nation ca be much affected by the prodigality of individuals; the profusion of some, being always more than compensated by the frugality and good conduct of others. Men are prompted to expense, by the desire of present enjoyment, a passion only momentary and occasional. They are prompted to save by the desire of bettering their condition, a passion which comes with them from the womb, and never leaves them till they go to the grave. In the whole course of life of the greater part of men, therefore, though the principle of expense prevails occasionally, yet the principle of frugality predominates, and predominates very greatly.(9)
"The principle exciting to frugality, the uniform, constant, and uninterrupted effort of every ma to better his condition, produces both public and national, as well as private opulence, and is frequently more than sufficiently powerful to counteract the extravagance of government, and the greatest errors of administration. Like the unknown principle of animal life, it frequently restores health and vigor to the constitution, in spite, not only of the disease, but of the absurd prescriptions of the doctor.(10) Alone and without any assistance, it is capable, not only of carrying on the society to wealth and prosperity, but of surmounting a hundred impertinent obstructions with which the folly of human laws too often encumbers its operations."(11)
The reader will perceive, that the whole force of these arguments lies in the assumption, that the process of the increase of national capital, is precisely the same as that of the increase of individual capital.
The observation of Bacon is now trite, that men believe that the words they employ in the process of reasoning, serve the intellect as mere passive instruments, but that, in reality, they have often an active reflex power, through which, while the mind deems it governs them, they are enabled to usurp the command of it, and so misdirect its course.
Our author notices the errors, which, in this way, have arisen from the use of the term money.
"Money, in common language, as I have already observed, frequently signifies wealth; and this ambiguity of expression has rendered this popular notion so familiar to us, that even they who are convinced of its absurdity, are very apt to forget their own principles, and, in the course of their reasons, to take it for granted as a certain and undeniable truth. Some of the best English writers upon commerce set out with observing, that the wealth of a country consists, not in its gold and silver only, but in its lands, houses, and consumable goods of all different kinds. In the course of their reasons, however, the lands, houses, and consumable goods, seem to slip out of their memory; and the strain of their argument frequently supposes that all wealth consists in gold and silver, and that to multiply those metals, is the great object of national industry and commerce."(12)
It is remarkable that, in the use of the term capital, he himself leads his readers into a somewhat similar error. Capital means in common language a sum of money, or something for which a sum of money can be got; and, as the increase both of national and individual capital produces a sum of money, or something for which a sum of money can be got, the similar estimation of both by a row of figures is the thing that in this way naturally comes uppermost to the mind, and hence, the things themselves in both cases forming the increase not being immediately present to its thoughts, it heedlessly falls into the conclusion that they also are perfectly similar. In comparing indeed the national capital as it has existed at distant periods, the small national capital of remote periods with the large national capital of the present, we immediately perceive, that not only the sum at which the national wealth was formerly rated is increased, but that the things which constituted it are changed. The wealth of England is certainly ten times now what it was in the reign of Henry the VIII; we do not conceive, however, that it is formed by the multiplying tenfold such articles as constituted the sole riches of its inhabitants in that somewhat rude and barbarous age. We perceive here, that there is, and must be, not only an increase, but a change. When, however, we come to consider the smaller parts of which this increase is gradually made up, as the change here is not perhaps perceptible, and as all we see is the sum produced by it, the fact of the increase being more easily ascertained than the manner of it, the similarity of the terms naturally inclines us to conceive that it resembles the increase of individual capital, and consists of a mere increase of things, not of a change also in them. Would we take time to consider of it, we must perceive that such an increase of national capital as individuals make of individual capital, is, at least, unlikely, seeing there is no apparent cause for it. Considering capital in general, the only use we can discover for it is its enabling the community to draw from the resources the country affords, the necessaries, conveniences, and amusements of life, its supply of which, according to our author, constitutes its real wealth. It is only so far as it is instrumental to this end that we can see a use, and therefore find a reason, for its existence. Now, as one individual is more provident and prudent than another, we can easily conceive how one may come to procure for himself a greater share than another of the national funds, the means, or instruments, serving to unlock the stores which the nation possesses; but it is not so easy to conceive how, or for what purpose, a general increase of these means or instruments should take place without some accompanying discovery of an improvement in their construction by which they may put additional stores within reach of the nation.
We may easily perceive this, by attending to any of the numerous small items of which the national capital is composed. I shall take an example of a very small one. The only instrument used for threshing out grain in Great Britain, until of recent years, was the flail. Hence one or more flails formed a part, though a small part, of every farmer's capital, and therefore all the flails that all the farmers had, a part, though an exceedingly inconsiderable part, of the national capital. So simple an instrument and one so easily formed, was made, I believe, generally, by the farmer or his servants, though sometimes, by professed mechanics. In whatever way fabricated, it is evident, however, that the number of flails made, though from the convenience of having a supply provided before hand they would exceed, could never much exceed, the number of persons employed in the operation of threshing. A professed flail-maker indeed, if diligent and intelligent, might, by the aid of these qualities, have been able to make them cheaper than his neighbors, and, if economical, to extend his business and come to have some amount of capital in this shape. But, though thus, by his industry and frugality, an individual might have accumulated capital under this form to an extent to which we can set no precise limits, the national capital never could have been so increased, because, if one person by greater diligence and activity, made more flails, another, from a deficiency of these qualities, would make fewer; or, if we suppose all the makers of the instrument to be alike industrious, and thus the stock of it to accumulate, so as to do more than supply the wants of the threshers, the article would remain on their hands, and they would naturally cease to produce the superabundant supply. While, therefore, the instrument retained this less perfect form, it is, I think, pretty evident, that, though individuals might accumulate capital by making flails, neither the national capital, nor the national revenue, would be much increased by their efforts so directed.
About forty years ago, the easier and more perfect method of executing this process, by what is called the threshing machine, was invented. These new instruments, though far more expensive than the former, yet, performing the operation more effectually, and with much less labor, became naturally things which farmers were desirous of having. A farmer could have had no motive to accumulate but a very trifling capital in the shape of flails, because half a dozen were as useful to him as half a thousand; but he had a great motive to accumulate a considerable capital in the shape of a threshing machine, because it would save him much annual expenditure of labor, and the operation so performed, separating the grain more effectually, would give him a small addition to the corn yielded by his subsequent crops. Accordingly its invention was followed by the accumulation in this form, of a large amount of capital, and so by an increase of the whole agricultural capital of the nation. But, besides this direct effect, the saving it produced in one of the main processes of agriculture augmented the profits of the farmers, and tended, therefore, to make all farmers cultivate their farms more perfectly, and some to engage in improving land not before cultivated. Both the direct and the indirect effects of this invention, therefore, must have helped, in no inconsiderable degree, to augment the agricultural capital, and so the whole capital of the nation.
"It readily occurs to every individual that the quantity of hardware, the number of pots and pans, is in every country limited by the use which there is for them; that it would be absurd to have more of such utensils than are necessary for cooking the victuals usually consumed there; and that, if the quantity of victuals were to increase, the number of pots and pans would readily increase along with it; a part of the increased quantity of victuals being employed in purchasing them, or in maintaining an additional number of workmen whose business it was to make them."(13) But, though the national capital cannot thus be supposed to accumulate in the shape of an additional number of pots and pans, individuals who deal in hardware frequently accumulate capitals in this shape, to a large amount. We can easily conceive, that the national capital also, might accumulate in this shape, were some discovery, producing an improvement in the manufacture, to occur. Were a method discovered of procuring and manufacturing platina, or some metal similar to it, at only four or five times the cost of brass, it would, without doubt, be employed in the fabrication of kitchen utensils of all sorts. Not being acted on by fire, and other destroying agents, it would save a great deal of the drudgery of the kitchen, and, though more costly at first, would probably, on the whole, be preferred by good economists. Thus, pots and pans becoming more expensive articles, the amount of national capital, or stock, accumulated in them, would be much greater, and, through this improvement, the whole national capital would, with advantage to the society, be somewhat augmented.
If any one will, in a similar manner, consider any of the other articles which help to make up the national capital, I think he will have difficulty in assigning a sufficient reason, from any of the views presented in the Wealth of Nations, for its increase, unless he connect this increase, somehow or another, with some improvement in the particular department of industry of which its production makes a part, or in some other department dependent on it. He will perceive, that, though there is no difficulty in conceiving that an individual may accumulate a very large capital in the form of any of those articles or commodities, the total of which make up the national capital; with the exception, perhaps, of money itself, there is difficulty in discovering a reason for the accumulation of any of them, throughout the whole community, so as to form any sensible addition to the national capital.
It may perhaps appear, that, in whatever shape the individual members of the community may accumulate capital, yet, that the efforts of the greater number being thus directed, they might accumulate it under some shape or another. We are not, however, it will be recollected, here discussing a possibility, but a self-evident principle; not what might be, but what must be. Now, there is no necessity for imagining that this must be the case, for, without entering at all into the minutiae of the subject, it is not difficult to perceive that the action of the principle which prompts to save, itself brings about a state of things, which diminishes the desire to save. A person must be most desirous of getting money when he perceives, that by the acquisition of it, he could make a great deal out of it; when. It is manifest to him, that, if he had a sufficient capital, he could enter on some branch of business that would be very profitable. When an opening of this sort presents itself to a prudent and enterprising, though poor man, the exertions he makes to gather together a small sum are sometimes almost incredible. But, if the principle were to prevail so generally as to fill up every branch of business within the society, the desire to acquire capital so as to enter on some of the particular businesses carried on in the society would naturally be diminished throughout the whole country and this general diminution of the motives to accumulate, might be sufficient to preserve the national capital within the bounds it had acquired, and prevent it, for a time, from gaining farther increase.
Nor is there any thing in the appearance of human affairs, which should induce us to conclude, that the increase of national capital ever does, in fact, proceed, unless in conjunction with some successful effort of the inventive faculty, some improvement of some of the employments formerly practised in the community, or some discovery of new arts. If we cast our eyes over the results, which either reading or observation presents to us, concerning the condition of different nations, we gather from our review, that many of them, in regard to the acquisition of wealth, have apparently remained stationary for ages, although undisturbed by external violence, and unmolested by internal tumults. During all the time, however, the process of individual accumulation was going on; men were continually rising from poverty to affluence, founding families, and leaving wealth to their descendants; but this wealth passed away from them; what the father gathered was not able to maintain his race, and they gradually sank to the rank from which he had emerged. The proportion, meantime, between rich and poor, and the total wealth of the community, remained but little changed.
At length, in some quarter or another, an improvement began to be perceived. What do we find to have been the most prominent accompaniment of this change? Is it a diminished expenditure -- an increased parsimony -- a frugality before unknown? I believe not. Any great diminution of the expenditure of a whole community, it will be found difficult to trace, but we shall always discover that invention has somehow or another been busy, either in improving agriculture and the other old arts, or in discovering new ones.
It is only when some great and striking improvement issues from the exertions of the inventive power, that we in general, attend to its effects. Every one readily grants, that, but for the invention of the steam engine, the capital of Great Britain would want much of its present vast amount. We perceive not so readily the numerous small improvements, which have been gradually, from year to year, spreading themselves through every department of the national industry . But, though not so palpably forced on our observation, we pass them by, they nevertheless exist, and sufficiently account for the manner in which the national capital has been augmenting, by being gradually accumulating in them, without the necessity of supposing that it ever has augmented precisely as that of individuals generally does, hy a simple multiplication, under the same form, of any or all the items, of which its amount was before made up.
Adam Smith himself admits, that a country may come to be fully stocked in proportion to all the business it has to transact, and have as great a quantity of stock employed, in every particular branch, as the nature and extent of the territory will admit. He speaks of Holland also, as a country which had then nearly acquired its full compliment of riches; where, in every particular branch of business, there was the greatest quantity of stock that could be employed in it.(14) It would then appear that, even according to him, the principle of individual accumulation, as a means of advancing the national capital, has limits beyond which it cannot pass. The same cannot be said of that increase which is derived from the attainment of those objects at which the inventive faculty aims. Had Holland, sixty years ago, been put in possession of the astonishing improvements in mechanical and manufacturing industry, which, since that period, have sprung up in Great Britain, who can suppose that she would have wanted ability to continue in the successful pursuit of wealth; or, that she would not have started forward with fresh vigor in the career, and advanced in it with greater rapidity than in any former period of her history? There is no avoiding the admission, that, to every great advance which nations make in the acquisition of wealth, it is necessary that invention leading to improvement should lend its aid; and, granting this, it necessarily follows, as when one cause is discovered sufficient to account for the phenomena, we should confine ourselves to it, that we are not warranted to assume that they make even the smallest sensible progress without the aid of the same faculty.
To this general observation there are only two apparent exceptions. The progress of commerce by the increase of some particular branch of it, or by the opening of fresh branches; and the settlement of new countries.
If these, however, should be esteemed exceptions to the observation with regard to any particular nation or nations, they are extensions of it with regard to all the nations of the earth; implying that the increase of general wealth is connected with the general spread of invention, or inventions, over the world.
The principle, therefore, of the identity of the interests of nations and individuals is by no means a self-evident principle. The identity of their interests can only follow from the identity of the ends which they pursue; but these ends being, as far as we can see, identical only in name, and in reality not identical, the presumption rather is, that the means also by which they are arrived at are not identical.
It seems to me, that it requires very little pausing upon the examination of this principle to perceive its inconclusiveness as an argument. It is a principle, nevertheless, which, like other popular doctrines founded merely on the ambiguity of a word, has been very much insisted on, and meets one in all variety of shapes. On this account, the reader may perhaps excuse me, for detaining him a little longer on the consideration of it, by bringing before him a passage from our author, which may serve to expose its unsoundness, by showing how easily it may be made to lead to the most obvious fallacies. "The annual produce of the land and labor of England is certainly much greater than it was more than a century ago at the restoration of Charles II. It was certainly much greater at the restoration than we can suppose it to have been about a hundred years before, at the accession of Elizabeth. At this period, too, we have reason to believe, the country was much more advanced in improvement than it had been about a century before, towards the close of the dissensions between the houses of York and Lancaster. Even then it was probably in a better condition than it had been at the Norman Conquest; and at the Norman Conquest, than during the confusion of the Saxon Heptarchy. Even at this early period it was certainly a more improved country than at the invasion of Julius Caesar, when its inhabitants were nearly in the same state with the savages in North America.
"In each of these periods, however, there was not only much private and public profusion, many expensive and unnecessary wars, great perversion of the annual produce from maintaining productive to maintain unproductive hands; but sometimes, in the confusion of civil discord, such absolute waste and destruction of stock as might be supposed not only to retard, as it certainly did, the natural accumulation of riches, but to have left the country, at the end of the period, poorer than at the beginning. Thus, in the happiest and most fortunate period of them all, that which has passed since the restoration, how many disorders and misfortunes have occurred, which, could they have been foreseen, not only the impoverishment, but the total ruin, of the country would have been expected from them. The fire and the plague of London, the two Dutch wars, the disorders of the Revolution, the war in Ireland, the four expensive French wars of 1688, 1702, 1742, 1750, together with the two rebellions of 1715 and 1745. In the course of the four French wars the nation has contracted more than £145,000,000 of debt, over and above all the other extraordinary annual expense which they occasioned; so that the whole cannot be computed at less than £200,000,000; so great a share of the annual produce of the land and labor of the country has, since the Revolution, been employed upon different occasions in maintaining an extraordinary number of unproductive hands. But had not those wars given this particular direction to so large a capital, the greater part of it would naturally have been employed in maintaining productive hands, whose labor would have replaced with a profit the whole value of . their consumption. The value of the annual produce of the land and labor of the country would have been considerably increased by it every year, and every year's increase would have augmented still more that of the following year. More houses would have been built, more lands would have been improved, and those which had been improved before would have been better cultivated; more manufactures would have been established, and those which had been established before would have been more extended; and to what height the real wealth and revenue of the country might by this time have been raised it is not perhaps very easy even to imagine."(15)
These conclusions would indeed all follow did individual and national capital augment on precisely the same principles; but as the progress of the inventive faculty, an essential element in the increase of national wealth, is here left out of the calculation, we have good reason to doubt its accuracy.
Before the time of the Essay on Population, arguments and conclusions very similar to these were brought forward concerning the waste of human life in wars, and the consequent amazing diminution of the greatness and prosperity of nations. Perhaps the fallacy of the one doctrine may be best exposed by stating the other.
"Nations, it was said, can only advance in greatness and prosperity as the numbers of their inhabitants increase. Whatever the natural fertility of the soil, however genial the climate, and however well fitted the whole country may be for the practice of every species of industry, yet, if it be deficient in population, these natural riches can never be elaborated, and it must hold a poor and inconsiderable rank in the scale of nations. A confined and comparatively barren territory, filled with a numerous, industrious population, exceeds the most fertile and extensive country scantily peopled. It is the people that make the state, its real riches lie in its inhabitants.
"But as population increases, and can only increase, by more coming into the world than go out of it, every man who marries and raises a family is a public benefactor, and the practice of celibacy, so far from being a virtue, is, in reality, a great public crime. The number, however, of those who marry, and have children, in all tolerably quiet and peaceable times, much exceeds that of those who remain single; and, consequently, the number of all the inhabitants of the earth has continually augmented, and, had it not been for the wars which the ambition of princes has stirred up, would have been still much farther augmented.
"The population of England is now much greater than at the Restoration. It was greater at the Restoration than at the accession of Elizabeth, and then than during the great civil wars. Even then it was greater than at the Conquest, and at that time, than at the invasion of Julius Caesar.
"In each of these periods, however, there were not only many private feuds and public dissensions; many bloody and harassing wars; great perversion of the powers of the inhabitants from the production to the destruction of life; but sometimes such dreadful massacres and bloodshed, so great multitudes perishing by the sword, and by famine following up its ravages, as might be supposed not only to have retarded the increase of the numbers of the inhabitants, but to have left them fewer at the end than at the beginning. Had it not been for these events, the greater part of those whom they carried off would have married and had children, whose whole numbers would naturally have been greater than that of the parents who procreated them. In this manner every generation would have exceeded proportionably the one preceding it. The number of industrious hands thus produced would have built more houses, would have improved more lands, and would have cultivated better those which had been improved before; more manufactures would have been established, and those which had been established before would have been more extended, and how far the population of the country, and its real wealth and strength, might have been carried by this time, it is not perhaps very easy to imagine."
The error of both reasonings arises, in the same manner, from taking what is merely a necessary concomitant, for a cause. It is perfectly true, that the real wealth, strength, and prosperity of a country, cannot advance, but as its population advances, and that population can only advance by more being brought into the world than go out of it. It is also true that they cannot advance but as its capital advances, and that its capital can only advance by more being saved than is spent. But when it is said in either case, that as they can only advance as population advances, or as accumulation advances, we have only to allow population to go on unrestrained, or only to allow accumulation to go on unchecked, we are deceived, and led to unwarrantable conclusions, by a sort of sleight in the use of words.
The contemplation of a couple contending with unremitting labor against the evils of poverty and want, and, however occasionally pinched by them themselves, warding them off with care and success from their offspring, and rearing up a numerous and industrious family, is a very pleasing sight. It is pleasing as an evidence of the existence of some of the best and purest affections of our nature; it is pleasing, also, from the mere view of the healthy addition thus made to that surest stay of a state, an industrious and frugal population. But when it is hence assumed, that nothing is wanting to augment the numbers of the community, and carry it forward to greatness, than that similar principles and conduct should be allowed to go on in all its members without restraint, a hasty and inaccurate conclusion is drawn from a partial view of a complicated subject. The numbers of a state can never exceed, what its resources can support. When these resources are augmented, the principles which tend to the preservation and multiplication of the species are, in all well regulated communities, sufficiently active speedily to fill up their numbers to the amount of the increased supply.
In like manner, the contemplation of honest industry, and patient frugality, not only manfully bearing up against present necessity and want, but repelling them, and accumulating a plentiful store to answer the demands of futurity, is also no unpleasing spectacle. But for such principles neither public nor private comfort or affluence could exist, or be preserved. But, when it is hence also assumed, that nothing else is wanting to carry the community forward to the highest degree of affluence and power, than that similar principles and conduct, through all its members, should be encouraged, and allowed to go on without check, a conclusion equally unwarranted and equally inaccurate, is drawn from a like hasty and imperfect view of a great subject. The capital of a state is a mere instrument in the hands of its industry, to enable it to draw forth the riches, with which the conjoined powers of nature and art have endowed it. A multiplication of instruments is of no avail, unless something additional be given on which they may operate. When invention succeeds in discovering these additional riches, the mere view is sufficient, in every well regulated community, to induce its members to form the new instruments, necessary to draw these riches forth.
There must be some strong inherent vice in any community, where the certain prospect of plentiful subsistence does not produce an abundant population. It can only be, also, from the effects of some great inherent vice, that, in any community, a very profitable investment for capital can be held out, and yet capital not accumulate with rapidity. Where there is no sufficient prospect of subsistence, people may be restrained from marriage by the dread of their families suffering want. Where there is no sufficient prospect of profit, people may be withheld from accumulating capital, because they may see no sufficiently profitable adventure open to them that they would not fear to embark in. But the fact is, that people, rather than live single, are inclined to marry at all risks, and hence population is kept down by misery, and premature death; and they are also, rather than do nothing, enclined to embark in adventures where the chances are against their success; hence the vast numbers of unsuccessful projects that in most communities are continually dissipating previous accumulations of capital. To form a right judgment of the power of any community, under the most favorable circumstances, of increasing its population, we must consider the additional marriages which would take place, and the greater numbers that would be reared to maturity from such as do take place, if plentiful subsistence were provided . In like manner, to form a right judgment of the powers of any community, under the most favorable circumstances, to increase its capital, we must consider, that, if abundance of secure and profitable investments for capital were presented, its members would be more eager to possess additional capital, and, therefore, would be more prompted to accumulate it; and the capital they possessed would be more productive, and would not be subject to be risked and lost in imprudent speculations.
From the inconsiderable rudiments of population and capital, which Great Britain furnished to North America, is to be traced the great amount of both, of which that flourishing division of the globe at present boasts. The former has increased so greatly, because plentiful subsistence has been afforded it: the latter, because profitable and secure investments have been presented to it. Had it been possible to have afforded, and had the same abundant subsistence been afforded, to the population, and the same profitable and secure investments to the capital remaining within the kingdom, they would have both augmented, we have every reason to believe, in a ratio equal to that at which the fragments of both that went to North America have augmented. It certainly was not the voyage across the Atlantic, but the rich soil on which they fell on the other side of it, that excited them to so luxuriant a growth.
This great productive power of both the population and capital of a country, when room is afforded them to shoot, seems so easily to fill up any gap which is made in the national members or stock, that a calculation founded on the assumption, that any loss in either which a nation may sustain, necessarily occasions a its funds must evidently proportionably permanent diminution of be inconclusive. It is very doubtful if the population of London or England would have been greater than it is at present, had there been no plague. It is very doubtful also if the capital of London or of England would have been greater than it is at present, had there been no great fire. The additional demand for labor and capital, which these disasters created, may very well be supposed soon to have brought both up to the amount they had previously attained.
In all instances of such, or even far greater calamities, destroying a part of the population or capital of a country, while the principles and elements, through and from which they sprang, are not consumed along with them, we see them quickly reproduced. When, for example, the great destroyer War holds his course through a country, and clearing wide his path with fire and sword, leaves property and life a wreck behind him, we see not that the traces of his wrath are long perpetuated; in the midst of the ruins of what were, lie the germs of what are to be, and seizing on the elements of existence that lie waste around, they expand with a vigor proportioned to the magnitude of the void that has been made for them, and speedily replenish it. Like the track of the whirlwind through the forest, the present desolation is quickly covered up and obliterated by the freshness of the new growth, to which that very desolation gives light, and air, and the means of existence. We should think the calculation rather fanciful, which, estimating the trees overborne by the blast for centuries, and reckoning the increase that might have possibly come from each of them, should bring out as a correct result, that all this would have been a clear addition to the vegetable life of the forest; and that so much greater it must have been to-day, had not these disasters had place. Calculations proceeding on the assumption of the indefinite increase of population or capital, without showing also that there will be room for them, are but little more logical.
Before population can advance, there must be something on which it can subsist; before capital can increase, there must be something in which it may be embodied. Produce subsistence, and, if vice prevent it not, population will follow; show that if capital did exist, it would produce great profits, and, if vice prevent it not, capital will be accumulated. But, until there be some means of subsisting the population, and employing the capital, they can never, by simply urging on their production, be rationally. expected to be much augmented.
It is invention, which showing how profitable returns may be got from the one, and how subsistence procured from the other, that may most fitly be esteemed the cause of the existence of both; and hence this power has most title to be ranked as the true generator of states and people. It is certainly, therefore, very far from being a self-evident truth, that the legislator, by employing the resources of the country in rousing this principle to activity, necessary retards, instead of advancing, the increase of wealth and the prosperity of the state.
Chapter II
Of the Identity of National and Individual Interests Considered as a Theoretical Principle
Though the doctrine of the identity of the interests of individuals and communities cannot be established as a simple and self-evident principle, from the assumption that the objects which individuals designedly pursue, for their private emolument, are precisely those which most promote the progress of the general opulence; and though in this sense, as we have seen, the identity of the ends which they pursue is nominal, not real, yet it follows not from this that the doctrine is necessarily erroneous. Many doctrines which are far more simple or self-evident are nevertheless true. Many, which at first sight seem even contradictory to experience, are found, by closer examination, to be legitimately deducible from it. It is manifest that the general opulence, however brought about, results, in some way or another, from the action and reaction on each other of the whole system of persons and things, which constitute communities, or belong to them. It is then at least possible to conceive that it is entirely produced by the efforts of individuals to advance their private fortunes. That, though it is the object of individuals to acquire wealth, and of nations to create it, yet that the series of actions which the former generate, in endeavoring to make the acquisition, are precisely those which are best calculated to forward the creation; and that thus, unconsciously to himself, each member of the community, while seeking merely his own benefit, necessarily adopts the very course which is most for the advantage of the society, and, to use our author's words, "is led in this, as in many other instances, by an invisible hand, to promote an end that was no part of his intention."
In this view of the subject the doctrine would put off the shape of a simple principle, and assume that of a theory deduced from an examination of the whole series of actions that are concerned in the production of the wealth of communities; and in this way we may conceive that it might be satisfactorily proved by an extended inquiry into the Nature of the Wealth of Nations.
Such is the theory of this department of human action, which the author gives. If it be found not to be inconsistent with the phenomena, but fairly deduced from them, the truth of the peculiar doctrine, which it is the aim of his work to maintain, would be established by it.
Before endeavoring to explain it, or attempting to show wherein it fails, it is proper to remark that it is blended, throughout the whole work, with that notion of the exact identity of the ends which nations and individuals pursue, the fallacy of which I trust I have, in some measure, exposed in the preceding chapter. I shall afterwards have occasion to show that this arrangement of his materials sometimes renders his arguments illogical. I am led to notice it at present, because I wish to account for the appearance of this assumption, unremarked by me, in the analysis of the theory I am about to give.
It must be apparent to every one acquainted with the system, that its parts would not in any way hang together, if deprived of the support which this popular notion gives to them. Indeed, I conceive that the truest account that could be given of it, would be to say, that it is altogether founded on the assumption that national and individual wealth and prosperity increase, and must increase, in precisely the same manner; and that the theoretical part of it merely serves to show how the increase of individual wealth does, in reality, produce the events which we see accompanying national wealth; that the former is the cause, and the sole cause, of the latter, and must therefore produce all the phenomena attendant on it, being taken for an undeniable fact, and the author seeming merely to have proposed to show how it may be supposed to produce those phenomena. Thus, were what was once the popular doctrine concerning population still held to be the correct one, and were we to take it for granted as an undeniable truth, that, as the national strength, and revenue, and wealth can only advance as the number of industrious hands that form them is increased, so every augmentation of the population of a nation is an addition to the national funds, and that, therefore, things ought to be allowed to take their natural course, and all restraints on marriage be done away with, the assumption and doctrine might be supported by a theory, showing, or endeavoring to show, how all the phenomena attending the advance of mankind towards prosperity and affluence do, in fact, result from their increasing numbers.
It might, perhaps, in support of such a view of the subject, be said, "that, as necessity is the mother of invention, so, unless pressed by want, or the dread of it, mankind might never have exercised their ingenuity in discovering even the rudiments of the arts; and certainly would not have advanced them beyond the most unformed and imperfect elements. That, while in genial climates the spontaneous fruits of the earth afforded them abundant nourishment, they could have had no motive to tax the labor of either their minds or bodies to produce that for which they had no need. That it was the increase of their numbers, which, rendering the supplies that nature had dealt out to them insufficient, imposed the task on them of searching out the means of procuring additions to them: and that thus necessity,
"Cutis acuens mortalia corda
* * * * *
Ut varias usus meditando extunderet artes
Paulatim, &c. -- "
"Whetting human industry by care.
That studious need might useful arts explore,"
is in truth the divinity that taught mankind the most essential arts."
Primo Ceres ferro mortales vertere terram
Instituit; cum jam glandes atque arbuta sacrae
Defeceruat sylvae et victum Didona negavit,"
"First Ceres taught the ground with grain to sow,
And armed with iron shares the crooked plough;
When new Dodonian oaks no more supplied
Their mast, and trees their forest fruit denied,"
"That this urgent necessity, this imperious mistress, which nature caused to spring from their increasing numbers, made them spread themselves over the earth, and people even the most rigorous climates. That the "rigid lore" of the "stern rugged nurse" thus imposed on them, though harsh, was healthful; as a proof of which we may observe, that men in general subsist in greatest comfort and abundance, where the climate is most forbidding, and the soil most stubborn, because there, that they may subsist at all, they have been obliged to call to their succour the most ingenious arts, and the most indefatigable industry,
"Labor omnia viacit
Improbus et duris urgens in rebus egestas."
"What cannot endless labor urged by need?"
That, as it is the action of this principle which has given rise to all the arts, so it is it which has brought them to perfection. That, while a territory is scantily peopled, and its inhabitants spread over it at a great distance from each other, they can never subdivide themselves into different trades and employments, and each devoting himself to a particular business and art, exercise his whole ingenuity to bring that particular occupation to perfection; and that hence arts are in general in the most flourishing condition, where the population is the most dense.
"That to these causes, thus necessarily proceeding from this great principle, we are to ascribe in particular both the opulence and prosperity of our own nation, and the necessary diffusion of the arts, manners, language, and race, with which they are connected, and in which they are embodied, over the remotest regions of the globe. That thus, although men in marrying seek only their own good, they nevertheless adopt that course which is most to the advantage of society; and here too, as in many other instances, are led by an invisible hand to promote an end which was no part of their intention. That, therefore, as the revenue and power of a nation can only increase as its population increases, and as the increase of population tends to give a beginning to every useful art, and to carry it to the highest perfection, legislators act a very absurd and culpable part in attempting, in any instance to restrain it, or to check what is undoubtedly the natural, and apparently the most beneficial course of events."
Such a theory, like almost every other view of only one side of a complicated subject, would probably be partly correct, and partly erroneous; but it might be possible to embrace in it a great mass of facts, and perhaps to give it considerable plausibility.
In examining the soundness of the doctrine founded on it, it might first be expedient to allow the assumptions necessarily involved in it to pass unnoticed, and to test its accuracy by an application to facts. Such is the course which I mean to follow in this introductory examination of the somewhat similar theory, as it seems to me, which is the groundwork for the vast and varied accumulation of facts and opinions embodied in the Wealth of Nations. I shall allow the author's assumptions to pass unquestioned in all cases where they are mixed with the explanation of real events, though I may esteem that explanation erroneous; and it is only where, alone and unconnected with facts, they are brought forward for the purpose of arguments as incontrovertible truths in order to establish the particular doctrine which I combat, that I will feel myself called on to expose the fallacies into which they lead.
The celebrated author remarks, "that it is from his labor alone that man can draw the necessaries, the conveniences, the amusements of human life, from the materials which nature has placed around him. As the amount of these necessaries, conveniences, and amusements, which any man can afford to enjoy, constitutes his riches; so the amount of them which all the men in the nation can enjoy constitutes the national riches. Labor, then, being the first price, the original purchase money, that is paid for all things, an inquiry into national wealth is, in fact, an inquiry into the means by which the labor of the individuals composing a nation may produce, from the materials they possess, the greatest amount of necessaries, conveniences, and amusements.
"These may either be the immediate produce of that labor, or what is purchased with that produce from other nations. Hence such an inquiry may be divided into two parts; the first treating of the means by which the produce of the national labor becomes greatest; the second, of the manner in which the part transferred to other nations procures from them, in return, the greatest amount of necessaries, conveniences, and amusements.
"First, then, may be considered the sources of wealth that lie altogether within the society, the means of bringing, by the labor of its members, out of the materials which it possesses, the greatest amount of products; that is, of articles affording necessaries, conveniences, or amusements.
"This, in any particular nation, must be regulated by two circumstances. First, by the skill, dexterity, and judgment with which its labor is generally applied; secondly, by the proportion between the number of those who are employed in useful labor, and that of those who are not so employed." It is to the first of these circumstances, which he observes is of much the greater influence, that our author's reasoning chiefly refer, and to the consideration of it, therefore, we may altogether confine ourselves.
"The chief cause operating on this, the main source of the productiveness of labor, is capital. Without capital, industry could scarce at all exist. While a man is executing a piece of labor, he must have, to maintain him, a stock of goods, and he must have ready provided for him the tools and materials necessary for performing the work. These are all procured by capital. A weaver, for instance, could not apply himself to manufacture a web of cloth, unless there were somewhere stored up for him a supply of food, and other necessaries, sufficient to maintain him till he complete and sell it, and were he not provided beforehand with a loom and other requisite tools and materials. It is capital which provides all these, either his own or that of some other person.
"As capital is thus the most essential element in setting industry in motion, so it is by the amount of it, that the productiveness of that industry is chiefly determined.
"Every man having capital naturally endeavors to make the most of it; that is, to cause the labor which it puts in motion to yield the greatest amount of productions. This he effects by the division of that labor; that is, by separating the operations it has to perform into as many distinct parts as possible, and allotting each of them to one man, or one set of men, as a peculiar employment.
"The increase arising to the productive powers of labor, from this division of it, is owing to three different circumstances. First, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; lastly, to the invention of a great number of machines which facilitate and abridge labor.
"First, the improvement of the dexterity of the workman necessarily increases the quantity of the work he can perform; and the division of labor, by reducing every man's business to some one simple operation, and by making this operation the sole employment of his life, necessarily increases by much the dexterity of the workman. A common smith, for instance, will scarce make more than three hundred nails a day, and those very bad ones. A boy who has devoted himself entirely to the business of making nails, can make upwards of two thousand.
"Secondly, time is not wasted in passing from one work to another, and the indolent sauntering habits induced by the frequent change of employment are avoided.
"Thirdly, the invention of all those machines by which labor is so much facilitated and abridged seems to have been originally owing to the division of labor. In consequence of it, the whole of every man's attention comes naturally to be directed to some one very simple object. It is naturally to be expected, therefore, that some one or other of those who are employed in each particular branch of labor should find out easier and readier methods of performing their own particular work, wherever the nature of it admits of improvement. In this mode a great number of such improvements on the productive power of labor have been made.
"The other improvements in machinery and manufactures(16) have been also owing to the division of labor. Many of them have been made by the ingenuity of those, who, from this separation of employments, have taken up the trade of making such machines; others, by that class of citizens of whom also philosophy or speculation becomes the sole trade and occupation.
"The perfection to which this division of labor may be carried depends on the amount of capital that sets it in motion; because the same number of workmen, executing a greater quantity of work in proportion as they are better classified and divided, require consequently, when so classified, a larger stock of materials, and the extent of the stock of materials provided must be regulated by the amount of capital accumulated. Again, when so divided, they both require and cause to be invented many new machines. These machines, also, can only be procured by .a capital previously stored up. Not only, however, does the accumulation of capital, by providing more abundant materials and better machines, enable the same number of workmen to be better divided, and to produce more work, but it also may be observed that the number of workmen in any branch of business increases with the division of labor in that branch. Thus the increased accumulation of capital, by effecting a more and more extended division of labor, not only increases the productiveness of the labor of the same number of workmen, but adds to that number. By both means, therefore, it greatly augments the total riches of the society, the amount of necessaries, conveniences, and amusements produced by its members, and consequently enjoyed by them.
"These productions which labor, by the aid of capital, effects have to be transported to the places where they are to be consumed, have there to be stored up till they may be wanted, when they have to be divided into small portions, suited to the convenience of the persons who are to use them. The dealers in wholesale and retail are enabled to perform these useful offices by the instrumentality of capital, and the greater the amount of that capital the more easily and effectually they can perform them. Hence, every addition their economy makes to that amount, tends also to the increase of the general prosperity.
"The division of labor is limited by the extent of the market. Before any man, or any set of men, can in common prudence devote themselves to any particular employment, they must be assured that they can dispose of the commodity which their exertions in the prosecution of that employment will produce. In situations where there is not a sufficient number of customers near at hand to consume the manufactured article, or where it cannot with advantage be transported to those at a distance, the making of that article can never become the exclusive employment of any man, or set of men. When, therefore, there is not a sufficiently extensive market, labor cannot be so much subdivided as it otherwise would, and its productive powers are cramped for want of room in which to exert themselves. The increase of capital extends the market by adding to the numbers and general opulence of the community, and by facilitating the modes of communication between all parts of the territories which it possesses, and this extending market gives, in turn, additional celerity to the increase of capital."
To this accumulation of capital, this continual parsimonious saving out of revenue, the principle that, according to our author, animates the whole progressive movement of the society, he assigns the following limit.
"When the stocks of many rich merchants are turned into the same trade, their mutual competition naturally tends to lower its profit; and, when there is a like increase of stock in all the different trades carried on in the same society, the same competition must produce the same effect on them all. As, then, the profits of capital continually lower with its augmentation, there must arrive a period when they will be so diminished as to render it no longer possible to save any part of them." When this period arrives, the country would then, I think, according to our author, have acquired its full complement of riches; every branch of business therein having the greatest quantity of capital that could be employed in it.
"But besides the immediate produce of its own industry, a country that has made any progress in the accumulation of capital, and consequent division of labor, and facility of production, comes to furnish other countries with many articles, and, in exchange, to receive from them many other articles. This forms another source from whence the necessaries, conveniences, and amusements of nations may be supplied. A country is enabled to do this from two causes. The soil, climate, and natural productions of countries are various. Hence one country has generally peculiar advantages over others in manufacturing certain articles. Again, one country exceeds another in the amount of capital it possesses, and consequently in the skill with which its industry is applied; hence, also, there are articles which it can produce in greater perfection than other countries, with greater facility, or both.
"This is the origin, and these are the advantages, of foreign trade. By means of it two or more nations are enabled to exchange with one another what would otherwise have been to each superfluous for what, through these exchanges, procures to each an additional amount of the necessaries, conveniences, and amusements of life.
"It is capital which enables them to effect these beneficial exchanges, and the amount of them must be limited by the amount of capital that can be embarked in the employment." What quantity of capital this employment may absorb, what quantity of productions may thus be exchanged between different countries, is a problem which our author has not, as far as I perceive, given us certain data for solving. Some of his followers think it illimitable, but it is clear that this was not his opinion, and that, though he did not assign the limits, he nevertheless believed there were limits to it. Accordingly he makes another channel, through which, when these are filled, it may flow, gathering still volume to itself, and adding to the national prosperity as it proceeds.
"This is what is called the carrying trade, the carrying the surplus produce of one nation to another. Two countries may have products which it would be advantageous for them to exchange, but they may not have capital sufficient to provide the means necessary for effecting this exchange. In such case, another nation having a superabundant capital may embark part of it in performing this office for them, and into this employment a country so circumstanced naturally directs such a capital. When the capital stock of any country is increased in such a degree, that it cannot be all employed in supplying the consumption, and supporting the productive labor of that particular country, the surplus part of it naturally disgorges itself into the carrying trade, and is employed in performing the same offices to other countries."(17)
It may be observed, however, with regard to this last employment, which our author assigns to capital, that it implies a superiority in the progress of the productive industry of the country enjoying the trade, which cannot be calculated on beforehand. A nation can only possess a carrying trade, from other nations wanting foreign trade. Though it may, therefore, form a source of gain to a particular nation, it seems not so properly to be reckoned among the causes of the wealth of nations; for, with the general progress of that wealth, according to the theory of our author, it would decay.
The ingenious theory, of the main elements of which, I have thus attempted to delineate the outlines, its eminent author has illustrated with a felicity of observation, and laboriousness of research, which it were as vain to attempt to depreciate. as superfluous to praise. He conceives that it establishes the following conclusions.
"The natural effort of every individual to better his own condition, when suffered to exert itself with freedom and security, is so powerful a principle, that it is alone, and without any assistance, not only capable of carrying on the society to wealth and prosperity, but of surmounting a hundred impertinent obstructions with which the folly of human laws too often encumbers its operations; though the effect of these obstructions is always, more or less, either to encroach upon its freedom or to diminish its security."(18) That "every system which endeavors, either, by extraordinary encouragements to draw towards a particular species of industry a greater share of the capital of the society, than what would naturally go to it, or, by extraordinary restraints, to force from a particular species of industry some share of the capital which would otherwise be employed in it, is, in reality, subversive of the great purpose which it means to promote. It retards instead of accelerating, the progress of the society towards wealth and greatness; and diminishes, instead of increasing, the real value of the annual produce of its land and labor." And therefore, that "all systems, either of preference or restraint, being completely taken away, the obvious and simple system of natural liberty establishes itself of its own accord. Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, or order of men. The sovereign is completely discharged from a duty, in attempting to perform which he must always be exposed to innumerable delusions, and for the proper performance of which no human wisdom or knowledge could ever be sufficient; the duty of superintending the industry of private people, and of directing it towards the employments most suitable to the interest of the society."(19)
I expect in the sequel to show that the system contains certain fundamental errors invalidating very many of the conclusions, which the author desires to establish. In the mean time, passing all such discussions, and viewing the subject in something of the light in which it seems to have been contemplated by Adam Smith himself, I would observe, that his system, if correct, must be consistent with itself, and with admitted facts. His theory pretends to show, that the source of the wealth of nations, the abundance, that is, of all the materials of comfort and enjoyment, the necessaries, the conveniences, the amusements of life which men possess, is to be found in the gradual accumulation of capital by the undisturbed industry and economy of individuals, continually, through the division of labor, introducing improvements in the modes in which this labor operates with that capital. and, consequently, increasing with the greatest possible rapidity the returns from them. His doctrine is, that the accumulation of capital by individuals, being thus the only thing required to produce that abundance with the greatest possible rapidity, ought never to be interfered with by the legislature; and that, if he does so, it must necessarily he to the detriment of the society for which he legislates. If, therefore, even according to him, there are other sources, than the mere accumulation of capital, and consequent division of labor, on which nations are dependent for turning their labor and capital to the best account, and thus drawing from their resources the most abundant returns of necessaries, conveniences, and amusements, that is of wealth; in so far, his theory would seem imperfect, and his doctrine inapplicable. If we then in particular turn to the part of the system with which we are specially interested, we find, in reality, that as far as it is concerned, the theory is thus inconsistent with events admitted by its author, that hence this portion of it is contradictory to itself, and to admitted phenomena, and that consequently the doctrine drawn from it cannot here be maintained.
In the account of the progress of opulence, given in the Wealth of Nations, we find assigned, as one of the causes of it, the introduction into a country of new manufactures. "According to the natural course of things," we are told, "the greater part of the wealth of any growing society is first directed to agriculture, afterwards to manufactures, and last of all to foreign commerce."(20) "After agriculture, the capital employed in manufactures puts into motion the greatest quantity of productive labor."(21) The utility of such manufactures is enlarged on in many parts of the work. "They give a new value to the surplus part of the rude produce by saving the expense of carrying it to the water side, or to some distant market, and they furnish cultivators with something in exchange for it, that is either useful or agreeable to them, upon easier terms than they could have obtained it before. The cultivators get a better price for their surplus produce, and can purchase cheaper other conveniences which they have occasion for. They are thus encouraged and enabled to increase this surplus produce by a farther improvement and better cultivation of the land; and as the fertility of the land had given birth to the manufacture, so the progress of the manufacture reacts upon the land, and increases still farther its fertility. The manufacturers first supply the neighborhood, and, as their work improves and refines, more distant markets. For though neither the rude produce nor even the coarse manufacture could, without the greatest difficulty, support the expense of a considerable land carriage, the refined and improved manufacture easily may. In a small bulk it frequently contains the price of a great quantity of rude produce."(22) "The revenue of a trading and manufacturing country must, other things being equal, always be much greater than that of one without trade or manufactures. By means of trade and manufactures a greater quantity of subsistence can be annually imported into a country than what its own lands, in the actual state of their cultivation, could afford. The inhabitants of a town, though they frequently possess no lands of their own, yet draw to themselves, by their industry, such a quantity of the rude produce of the lands of other people as supply them, not only with the materials of their work, but with the fund of their subsistence. What a town always is in regard to the country in its neighborhood, one independent state or country may frequently be with regard to other independent states or countries.(23) Commerce and manufactures gradually introduced order and good government's (into Europe) "and with them the liberty and security of individuals, among the inhabitants of the country who had before lived almost in a continual state of war with their neighbors, and of servile dependency upon their superiors.(24)
"No foreign war, of great expense or duration, could conveniently be carried on by the exportation of the rude produce of the soil. The expense of sending such a quantity of it to a foreign country as might purchase the pay and provisions of an army would be too great. Few countries, too, produce much more produce than what is sufficient for the subsistence of their own inhabitants. To send abroad any great quantity of it, therefore, would be to send abroad a part of the necessary subsistence of the people. It is otherwise with the exportation of manufactures. The maintenance of the people employed in them is kept at home, and only the surplus part of their work is exported. Among nations to whom commerce and manufactures are little known, the sovereign, upon extraordinary occasions, can seldom draw any considerable aid from his subjects.(25) In modem war the great expense of fire arms gives an evident advantage to the nation which can best afford that expense; and, consequently, to an opulent and civilized over a poor and barbarous nation."
According to our author, some of these manufactures proceed from the original rude arts of the country cultivated and refined by the gradual progress of capital and of the division of labor; others are introduced from foreign states. This transfer takes place in the following manner. Trade first, by degrees, introduces a taste for the foreign manufacture; the demand for it increases with time and the opulence of the society. But when this trade has become so general as to occasion an extensive consumption, the merchants of the country, to save the expense attending the transport of the article from a foreign country, introduce the manufacture of it at home.
In some cases, then, the increase of capital, arising from the accumulation of individuals, and division of labor thence arising, is not, it would appear, sufficient alone to account for the progress
of improvement, and consequent production of fresh funds out of which wealth may grow. For, in cases where the raw materials exist, and capital to divide labor and put it in motion also exists, these are sometimes confessedly dependent on the importation of new arts from other countries, for the means of being advantageously directed. These admitted facts are certainly not in accordance with our author's theory. Passing, however, the consideration of this at present, I should wish to direct the reader's attention to the application of his peculiar doctrines to events of this class; and, that I may do so, it is necessary to examine them with somewhat more attention.
When goods are transported from a distance, a great part of their price is made up of the expense, attending the transport. This arises not merely from the simple expense of carriage, but from the risk attending it, from the perils of land and water, and the carelessness or knavery of those who are entrusted with it; from the profits which the different capitalists, through whom they may be transferred, exact, and from the damage to which commodities are subject by being long kept on hand. The price of very many commodities transported from one country to another is doubled by the influence of these causes; not a few of them derive more than three fourths of their value from them.
Hence the transfer of the manufacture of such goods to the countries to which, when manufactured, they were before sent, is very highly advantageous to those countries. It is advantageous from the saving to the national income which it effects by doing away with the expense of transport; from furnishing, according to our author, a new and more profitable employment for capital; and from the general effects it produces on. the national prosperity, as exemplified by him in the passages I have quoted. It must be allowed, however, that this introduction of such manufactures, by the violent operation, as he terms it, of the stocks of particular merchants and undertakers, who establish them in imitation of some foreign manufactures of the same kind, is a matter of great difficulty.
For, in the first place, the materials which the home supply affords will, in all probability, be not altogether similar to those that are used for the same purpose in the foreign country. Some may be better, some worse adapted to the purpose, but they can scarcely be altogether alike. They must vary, too, in their price, some being cheaper, some dearer, than in the country from whence the manufacture is brought.
The greater part of manufactures are also influenced by the climate. The dryness or moisture of the atmosphere, the degrees of heat and cold, the brightness of the sky and consequent intensity of the light, are circumstances which all, more or less, affect many manufactures.
The proportion between the rates of wages and profits of stock is also very different in different countries, and it considerably influences the determination of what may be the most advantageous mode of conducting any process in any country.
When the discovery of that exact mode of procedure, which the relations and connexions that these new circumstances have to each other renders most expedient, has once been made, it may be found that they are on the whole more favorable, and such as will produce a better article, at less cost, in the country to which the manufacture is transported, than in that in which it was originally exercised. To make the discovery, however, of this exact procedure is always a matter of difficulty, and implies almost necessarily the previous commission of many errors and mistakes, and the incurring of much needless expense and loss. A single individual, whatever intelligence and application he may possess, can scarce hope to arrive at it; it requires the efforts of many individuals, continued through a considerable course of time.
But these modifications, in the process of any manufacture, which its removal from one country to another demands, axe far from being the only difficulty attending that removal. An accurate knowledge of the principles of the manufacture, and of the manner in which every part of it is carried on in the foreign country, must be obtained; the requisite machinery has to be provided, and workmen, possessing the skill and dexterity which each part of the process requires, must be procured. These are generally matters of great difficulty.
Very few individuals have a thorough knowledge of every different part of any complicated manufacture. In examining any large and successful manufacturing establishment, we commonly find that the various parts of it depend, for the perfection with which they are conducted, on the efforts of different individuals, who devote their whole attention to their own departments, and are not at all qualified to change places with each other; while the director of the whole has only such a general
knowledge of each as enables him to say when it is properly conducted, not himself to point out the exact mode of best conducting it. It is his business to preserve the economy of the whole, and to search out the individuals best fitted for carrying on every part. Hence the undertaker of any such work, in a country where it has not been practised, has not only to engage one, but generally many individuals, in order that the different processes of the manufacture may be properly conducted. The difficulty of finding persons of sufficient intelligence and integrity for the purpose, who will remove to a distant country, without an extravagant reward, is very great, and the risk of being imposed on by engaging persons of insufficient skill, and consequently suffering considerable loss, is not small. The difficulty of transporting, or of constructing there, the necessary machinery, is often still greater; and when these are procured, workmen having the requisite skill and dexterity for performing the mere manual part are still wanting. These, if brought from a foreign country, as ms often necessary, can only be induced to expatriate themselves by the receipt of exorbitant wages; and, even if the natives of the country where the new manufacture in to be established can be trained from the first to execute the necessary manual operations, besides the loss arising from their deficient dexterity, they
will demand higher wages than those engaged in established employments. A man naturally prefers continuing in any sort of work which he understands, rather than displaying his awkwardness in attempting to perform an operation that is strange to him. Besides, he has, in general, reason to apprehend that, should the new manufacture fail, he will have difficulty in again finding employment in the trade he had forsaken. On these accounts it happens that "when a projector attempts to establish a new manufacture, he must at first entice his workmen from other employments by higher wages than they can either earn in their own trades, or than the nature of his work would otherwise require; and a considerable time must pass away before he can venture to reduce them to the common level."(26)
All these circumstances create so many obstacles to the efforts of private individuals, in their endeavors to carry a manufacture from a country in which it already prospers, to another in which it is unknown, that it is, I believe, very rarely they have succeeded in doing so, without the occurrence of some favorable conjuncture of events, to aid them in the project.
In point of fact it will be found, that the transfer of manufactures from one nation to another, or rather the general propagation, through all countries, of this most important source of the opulence of every one, has been chiefly owing to causes, which, at first sight, would seem little calculated to produce so beneficial effects. Wars and conquests, tyranny and persecution, the jealousy and hatred of rival states, have, strange to say, been the main agents in disseminating arts and industry over the globe, and thus ameliorating the social condition of the whole human race. Events, that, to those to whom they happened, brought nothing but calamity and suffering, have procured prosperity and opulence to the generations that have succeeded them; convulsions, that disturb and derange the frame of civil society, like those which occasionally shake and desolate the globe, in the midst of present destruction and devastation, carrying often the elements of future fertility and abundance.
Manufactures have commonly been carried to a distance by the men who have exercised those manufactures. But no one willingly expatriates himself. They even, who would seem to have least to attach them to their native soil, the poor mechanic, and drudging laborer, cling to it with the greatest tenacity, and generally quit it not, unless forced from it by inevitable necessity or by the continued pressure of some heavy evil. In this way the ills, that the tyranny of despots, or civil and religious factions, or war, or famine, brings upon communities, have often compelled great numbers of their most industrious citizens, to
abandon their homes, and seek refuge in foreign countries. These emigrations have been powerfully instrumental in improving the arts of civilized life and diffusing a knowledge of them over the earth. Perhaps few arts would have much passed the narrow limits to which their first discovery confined them, had not communities been subject to be tom in pieces, and scattered abroad, by the violence of the events to which we allude. They have been taking place in every age since the world began, and have been, every now and then, forcing large bands of men to quit their native homes and seek refuge in foreign countries. Whenever such emigrations occur, they carry the knowledge and skill
of the countries they leave, into those in which they settle, and diffuse them over them; by bringing together the different arts of different countries, they enable one to borrow from the other, and raise all nearer to perfection; and, by giving opportunity to them to unite with one another, from that union, they occasionally produce some that did not before exist. In all these modes, they have promoted very greatly the progress of human improvement. The influence of these causes, though more powerful
in remote ages than in the present times, has not yet ceased. It is shown in events of very recent date or actual progress. To it we chiefly owe the origin of those flourishing states, which the European race have raised up in North America; and the rapid progress over the Western Hemisphere, of every improvement that art or science effects in the Eastern.
Besides the direct agency which these outbreakings of the violent passions of mankind, by disturbing and deranging the smooth and uniform course of human existence, have had in casting it into new and often improved forms, they have produced similar effects in a manner less conspicuous and evident. Commerce introduces a taste for the productions of the arts of one country into others, which are remote from it. These productions, at first regarded as mere superfluities or luxuries, pass, in time and from habit, into things essential to the comfort, almost to the existence, of those who have become accustomed to their use. War interrupts this commerce and thus cuts off the supply that it afforded of such articles. Excited by the rewards offered by the eagerness of a demand that cannot be supplied from abroad, the domestic industry of the country then exerts itself, first, to produce rude imitations of the foreign commodity, and at length, rival manufactures. This is a cause which has extensively operated in modern times, in spreading manufactures from country to country. It is to the wars springing out of the French revolution, and the interruption to European commerce that they
occasioned, that the first rise of many manufactures in different parts of the old and new world, which are now in a very prosperous condition, is to be traced.
But besides the influence which the violent operation of foreign wars, and intestine commotions, has had in promoting the propagation of arts over the world, many of them unquestionably have been encouraged and enabled to extend themselves to, and take root in, countries remote from the seats where they originally flourished, by the direct efforts of the legislators of such countries, to draw them there, to cherish their first feeble advances, and to promote their subsequent growth and vigor. There are very few productions of modern art, that do not stand indebted to the legislators of the countries in which they are manufactured, for their advancement and perfection.
These three causes have, generally, more or less cooperated with each other in the extension and advancement of every branch of art. The cases where the efforts of private individuals, unaided by one or all of them, have-been successfull in transferring any manufacture to a distant country, are, as I have already observed, exceedingly rare.
In accordance with the doctrine which he supports throughout, it is here maintained by our author that the last of these causes operating in the production of new arts, or in their introduction
into a country, the interference, viz, of the legislator, is improper, because necessarily injurious; and that his agency, so directed, always, and from its very nature, instead of promoting the advancement of the general opulence and prosperity, operates in a manner prejudicial to both. Allowing that this introduction of new arts and manufactures from foreign states is, in itself, beneficial, in so much that he assigns it, as we have seen, as one of the causes of countries becoming wealthy and prosperous; he maintains, that this particular mode of introducing them is necessarily injurious. We have then to inquire, if there are any other means by which, according to his principles, this acknowledged most beneficial result can be brought about.
The violent operation of foreign wars or domestic disturbances, will scarce, I think, be said to be more advantageous methods of effecting this purpose, than the restrictions and bounties of the
legislator. At all events such causes are continually diminishing in their frequency and the vigour of their operations, and becoming more and more beyond the reach of our calculations. For spreading the useful arts from people to people, this element confessedly of very great importance in the advance of the general welfare of mankind, there remains then, according to these principles, but the unaided efforts of private individuals alone.
It must be kept in mind, that, by the efforts of individuals, are meant, according to our author, their endeavors to better their condition; that is, as he defines it, to increase their fortunes. But, in order to add to his fortune, one must get more than he gives. No such efforts can ever lead any individual to embark in a project that will probably take more from him, than it will return to him. Now, to transfer a manufacture from one country to another, must always be a very tedious and expensive operation, for any individual to perform. The consideration of his own profit, the sole motive according to our author, which determines the owner of a capital to employ it in any undertaking, would never lead one, to engage in the enterprise of establishing a new manufacture in any country unless of such commodities as were of common consumption in it, and which he could therefore be sure to sell. Those commodities being of common consumption, and not produced within the country, must at the time be furnished by some foreign state, and, consequently, to procure their sale, he must be able to supply them, at as cheap a rate as that state. The effecting this, for reasons I have stated, would generally take more time and money, than any private individual can afford. But, granting that the funds of some private individuals could afford this requisite outlay, and that they should succeed m bringing the manufacture to such perfection as to enable them to sell the commodity on terms equal to those of the foreign merchant, or lower than his, the more difficult question is, how is this great outlay to be reimbursed? A great part of an individual's capital has been expended. This expenditure can, evidently, be reimbursed to him only by his drawing proportionally larger profits, than he otherwise could, from what remains. To balance the extraordinary outlay, he must have extraordinary returns.
But profits far exceeding the usual rate of profit can scarcely ever be drawn, for any time from, any employment. "If, in the same neighborhood, there was any employment evidently more advantageous than the rest, so many people would crowd into it, that its advantages would soon return into the level of other employments."(27) It is no doubt true, that the proprietor of such new manufacture might, sometimes, not only succeed in establishing it, but in keeping secret the great profits he made from it, for a considerable period. This is a piece of good fortune, however, which, though it might sometimes befall an individual, he could never beforehand fairly calculate on. It is much more probable that his success would be blazoned abroad and exaggerated, that several projectors would establish themselves beside him, and, by bribing his workmen with somewhat higher
wages, with comparative ease, succeed in depriving him of the profits he might otherwise have drawn from his extraordinary outlay of labor and capital.(28) It may, therefore, I think, be safely laid down as a principle, that, in all ordinary cases, a due regard to their own interests cannot be a motive sufficient to prompt individuals to such undertakings. It may no doubt happen, as capitalists are every now and then engaging in injudicious projects, and such as either injure or ruin them, that some one may be imprudent enough to enter on such a project as this, and may succeed in introducing a particular manufacture, though with the loss of part, or of the whole of his capital. But, even granting that such an occurrence as this may sometimes take place, it would be far from serving to help out the theory we are discussing. "Every injudicious and unsuccessful project in agriculture, mines, fisheries, trade, or manufactures, tends to diminish the funds destined for the maintenance of productive labor. In every such project, though the capital is consumed by productive hands only, yet, as by the injudicious manner they are employed, they do not produce the full value of their consumption, there must always be some diminution in what would otherwise have been the productive funds of the society."(29) This project then, being injudicious and unsuccessful, for it would have occasioned the loss of a portion of individual capital, must, by these principles, be injurious to the society.
If it be said by any supporter of these doctrines, that this is too strict and constrained an interpretation of them, and that the loss which the society sustains, by the destruction of the capital
of the original introducer of the manufacture, must be allowed to be made up by the gain which it receives from the profits made by those who afterwards engage in it;(30) I reply, that I perfectly agree with him in his conclusions. I too think, that the small present expenditure of the funds of the society which the project may occasion, may be more than repaid, by the large future revenue that it will bring in. The only difference between us is, that the doctrines he advocates, teach us to wait, till the miscalculations of some unfortunate projector confer on us a public benefit, whereas, I hold, that it would be more just and judicious that the necessary first cost of the scheme should be borne by the
whole community; more just, as thus the burden necessary to be borne to procure a common benefit will be divided amongst all, instead of being sustained by one; more judicious, as the society will not have to wait, for the attainment of a desirable object, on so doubtful a chance as the folly of projectors.
It may also happen, that an individual, by some rare concurrence of accidents, may become initiated into all the secrets of some foreign manufacture, and, by some equally rare and happy union
of good fortune and ingenuity, may succeed in introducing it into his own country with profit to himself. To wait, however, for this, or any such like lucky chance, or singularly fortunate concurrence of circumstances, while better could be done, would be Like waiting till the natural actions of the winds and tides should, by some strangely propitious concurrence of events, cast upon our shores a valuable plant or seed, that we might directly procure for the mere trouble and expense of sending for it.
There are, also, another class of motives, capable, no doubt, of leading even individuals into such undertakings, and of carrying them successfully through them. The love of country or fame, or the desire to gratify personal vanity, are powerful motives of human action, and may sometimes even be directed into such channels as this. But, as the tendency of such motives to promote the growth of national wealth is opposed to the principles of our author, and is expressly denied by him, we need not here enter into any inquiry concerning them.
There is, however, one case, in which it cannot be denied, that the efforts of individuals to promote their own interests may be sufficient to introduce a new manufacture. If, in the progress of events, the requisites for a foreign manufacture come to be produced in so great abundance, and with so much facility, in any country, that a projector there finds that he can from the first afford to manufacture the commodity, and sell it at as low a rate as the foreign merchant, a due regard to self-interest will certainly direct a portion of the national capital into that employment. But, a case of the circumstances of a country being so peculiarly favorable to the practice of a foreign art, that, in the very first essays it makes in it, it can successfully compete with another, where that art has been long established, is assuredly very rare; and, if any such case occur, we may be satisfied that the manufacture might, with much advantage, have been previously introduced.
In a passage already quoted, it is observed, that, "when a taste for foreign manufactures becomes general, the merchants, in order to save the expense of carriage, naturally endeavor to establish some manufacture of the same kind in their own country." These expressions are somewhat too loose to coincide with our author's theory. It cannot be to save the expense of carriage, but to add to his own riches, that a merchant will endeavor to do any such thing. The consummation of such a measure, by saving a considerable expense to the community, might indeed add largely to the means of increasing their wealth in possession of all the merchants, or rather of all the members of the society; but "it is his own advantage, and not that of the society, which every member of it has in view;" and, in this system of perfect liberty and freedom from restraint, which is asserted to be the true plan of carrying the general prosperity of the community to the highest pitch, the difficulty is, to discover a method of inducing an individual to incur an unavoidable outlay, the returns from which, although very beneficial to the whole society, are no more so to him who lays out a great deal, than to others who lay out nothing. Union is said to give strength. But union cannot exist unless there be a bond to unite, and this bond must confine and restrain. The rods to make a bundle were tied together. Men are tied by law, a bond binding all to pursue the course supposed to conduce most to the general happiness. This bond, though restraining individual freedom of action, and preventing individuals from pursuing the course which they might find most conducive to their own private happiness has not, on the whole, been esteemed to have slightly promoted the great end for which it exists, the general well-being of mankind. We seek to rectify its errors, not to abolish it. The peculiarity of this system, relating to this particular part of the field of human action, is, that it maintains that men cannot in it, as elsewhere, unite, so as to attain a common good. That, on the contrary, when they so unite, instead of attaining a common good, they necessarily burden themselves
with a common evil. It aims, not to remedy any errors committed in adjusting the bond, but, to cut it asunder and cast it away. It is called a system of complete freedom from restraint and perfect liberty. These terms, when looked at nearly, will be found to mean a dissolution of all bonds and total isolation of interests. Hence, in this particular case, where an end is to be gained, the attainment of which it is admitted would be beneficial to all, it is yet maintained that it is impossible for all to bring it to pass without hurting instead of benefitting themselves.
It is impossible to shut the eyes to the fact, that the introduction of an art into any country, enabling the labor of its inhabitants at once to transmute the products, which nature, in conjunction with their own industry, procures for them, into the commodities their wants demand, instead of sending them to a distance to other people to effect that change, is a great good to all, were it only for the mere saving of transport thus effected; but it is maintained, that it is impossible for all the members of the community advantageously to unite in bringing about this common benefit. It is clearly seen, that a new channel might be opened from the exhaustless river of human power, springing from the mingled sources of nature and art, and that, if so, a plenteous stream would flow in on the community from which individuals drawing might largely add to the general opulence. But some means must be employed to open it up. There is an obstruction in the way that must previously be overcome; a rock blocking it up that must be removed. No individual will open up the channel, because, were he so to do, he could derive no more benefit from the labor than others who had not labored. The whole society, or rather the legislator, the power acting for the whole society, might do so, and in similar cases has done so, and, to judge of the measure by the events consequent on it, with the happiest success. Why, then, should he not?
The arguments advanced by the author of the Wealth of Nations, to prove that the legislator never ought to lend his aid to effect such a purpose, are chiefly contained in the second chapter of the fourth book. They will be found to rest almost altogether on the assumption, that national and individual capital increase in precisely the same manner. This notion, I flatter myself I have shown, cannot, by any means, be taken as a self-evident principle, or one so firmly established as to serve to build an important practical doctrine on it. But, even admitting that the two processes are similar, the arguments of Adam Smith would not altogether bear out his conclusions.
It is, he says, and the sentiment serves for a motto, and forms, indeed, the substance of two volumes that have contributed greatly to spread his doctrines over Europe, "It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. The tailor does not attempt to make his own shoes, but buys them of the shoemaker. The shoemaker does not attempt to make his own clothes, but employs a tailor. The farmer attempts to make neither the one nor the other, but employs those different artificers. All of them find it for their interest to employ their whole industry in a way in which they have some advantage over their neighbors, and to purchase with a part of its produce, or, what is the same thing, with the price of a part of it, whatever else they have occasion for. What is prudence in the conduct of every private family can scarce be folly in that of a great kingdom."
To make the fanciful parallel here assumed as complete, in any sense just, it would be necessary to place the tailor at a hundred miles distance from the shoemaker. Were he at this distance, and did he find that the expense of getting a pair of shoes carried so far was considerable, perhaps exceeding their first cost, he might find it good economy even to make them himself. To be sure, the procuring the requisite tools and the learning their use, would render the making of the first few pairs much more expensive than the purchasing of them would have been. But this necessary dearness of the first articles produced might be compensated by the cheapness of those produced subsequently. In the same way, though a farmer, if the tailor and shoemaker were near at hand, would do wisely to employ them, yet, if they were at a great distance, he might possibly with advantage dispense with their services, and set some of his family to make clothes and shoes for the rest. A farmer, indeed, would have peculiar inducements to practise some trades, those, namely, for which he supplied the raw materials, as by doing so he would be saved the carriage, both of the articles made, and of the stuff for making them. It is thus, that, in fact, in most countries where the population is scattered and the internal communications are bad, many trades are practised in the farmers' houses and by their own families. In this way it is that, in very many of the recently settled parts of North America, every operation that the wool undergoes, from the taking off the fleece to the cutting and making up the cloth, is performed in the farmer's house and by his own family. A similar state of things caused a similar practice to prevail in England a century ago, and, at present, keeps up many of those manufactures which are properly termed domestic, in many other parts of Europe. In Canada it is not
uncommon for the farmer to have, not only the whole processes that wool undergoes till it come to be worn, carried on by the members of his own family, but also to get a great variety of other things made by them, which he could not procure otherwise unless by sending to an inconvenient distance. The mending of shoes, very generally, the making of them, not unfrequently, and sometimes even the manufacturing the leather, are in recent and remote settlements thus performed. The latter process, I may add, from various circumstances, but chiefly from the use of the bark of a sort of pine peculiar to the country, and in general very common, and which, unlike that of the oak, is very thick and easily collected, is much less expensive in Canada than in Britain.
I knew two brothers whose farms or estates lay in one of the interior districts of that country, in the midst of its forests, and consequently at a considerable distance, perhaps twenty or thirty miles, from artificers of any description. Having each of them large families and productive farms, they had occasion for the services of various artificers, and had the means of paying them. Nevertheless, they very rarely employed them; almost every article they required was made by some one of the two families. As they were prudent and sagacious men, of which they produced the best evidence in the general success of their undertakings, and the prosperity of the settlement of which they were at the
head, I think it likely, that in this also they had turned their means to the best account. In fact, as they who are familiar with the details of beginning settlements in North America, will admit, by this plan they in a great measure obviated the two chief drawbacks on the prosperity of new and remote settlements, the excessive dearness of every article not produced there, from the great expense attending the transport of the raw produce and retransport of the manufactured goods, and the serious inconvenience arising from the difficulty, in such situations, of supplying, when necessary, unforeseen hut pressing wants.
Among other things which they got made on their own farms, were boots, shoes, and leather. That they might get this done, they were at the pains and expense of sending one of the young men to some distance, to make himself sufficiently master of those trades for their purpose. They thought, however, that the cost they were thus put to was repaid, thrice over, by the saving of time and expense which it effected for them, in enabling them to make, out of leather which cost them very little, numerous articles that they must otherwise have been constantly sending for to a great distance by roads that were almost impracticable a great part of the season. I do not know whether in this their conduct was judicious or otherwise, but, it is very certain, that however apparently prudent the measure may have been, and however great the saving effected by it might have been, it was completely contrary to our author's doctrines, and might easily be shown by them to have been necessarily and inevitably injurious.
We may suppose that, just at the time when these two legislators of this little community had come to the determination of taking means to dispense with the services of the distant tanner and shoemaker, they were addressed on this subject by a philosopher of this school. His reasons would doubtless have been in the following strain. "You are assuredly wrong in the plan you are going to adopt, for it proceeds upon very erroneous and illiberal principles, as I can easily show you. You are in want, you say, of some pairs of shoes, surely then it is best for you to purchase them where you can get them cheapest. But, by the plan you are taking of going to a great expense to have them made at home, they will certainly cost you more when made there, than if bought at the place where you have hitherto purchased shoes. And, if that place can supply you with this commodity cheaper than you yourself can make it, better buy it there with some part of the produce of your own industry. The general industry of your settlement must always be in proportion to the capital which employs it, and will not be diminished by being left to be employed in a way in which you have some advantage. By forcing it to produce an object which it can buy cheaper than it can make, it certainly is not employed to the greatest advantage. Let things therefore take their natural course, and shoes will be made at your doors when it is fit for them to be made there."
To these reasons our legislators might possibly reply, "We confess that the first pairs of shoes that we get, will cost us much more, thus made at home, than they would do were we to buy them abroad. But then it will only be for the first articles manufactured that we shall pay so high, in the end they will come cheaper to us at home than from abroad; and it is to effect this desirable result, that we are going to undertake the project. We don't understand very well what you mean by the natural course of affairs, but we think the sooner we can get them to take a course, that will before long make things cheaper to us, the better." The answer to this in the words of our author would be: "I don't at all dispute, that, by means of this project, this particular manufacture may be acquired sooner than it could be otherwise, and after a certain time, may be made at home as cheap, or cheaper, than abroad. But, though the industry of your society may be thus carried with advantage into a particular channel sooner than it could have been otherwise, it will by no means follow that the sum total, either of its industry, or its revenue, can ever be augmented by any such project. The industry of your society can augment only in proportion as its capital augments, and its capital can augment only in proportion to what can be saved out of its revenue. But the immediate effect of this project of yours is to diminish its revenue; and what diminishes its revenue is certainly not very likely to augment its capital faster than it would augment, were you to leave capital and industry to find their natural employments."
Our legislators might still possibly answer. "As far as we can comprehend your arguments they reduce themselves to this. We have to give out what is a considerable sum to us, before we can carry this project into effect, and, for this outlay, you think we shall get no adequate return. Now in this our opinion differs from yours. We know indeed that we must expend something, but we think that in the long run we shall be better repaid for this expenditure, by this undertaking, than by any other in which we could employ our finds. We never yet got any thing without giving something for it, and, although we in this instance give money or money's worth, and get chiefly knowledge and skill
in return, yet if you will take the trouble of examining the calculations we have been making of the saving which we shall in a few years effect, chiefly by means of this knowledge and skill, on what we annually pay for shoes and boots, we think you will agree with us that we shall gather in three times what we gave out."
"No no," our philosopher would exclaim, "this is quite unnecessary, I see now how the case stands. I perceive you have got a theory as well as I have. But your theory is that of practical men who reason upon facts, whereas my theory is built upon general axioms. Now there is this great difference between two such theories, that when they are opposed to each other the latter, such as mine must always be right, the former such as yours wrong. My main axiom on which is founded a great system is, that capital always augments by accumulation. This you perceive is a general axiom, and however it may be that there may be apparent exceptions to it yet as it is a general axiom, it is a philosophical consequence that these exceptions can only be apparent. Your theory is opposed to this axiom of mine, for you pretend to say that capital may be augmented by other means than simple accumulation, and very strangely assert that, after giving it out of your hands, you will get it replaced to you, with large profit, out of the skill and knowledge which the outlay has procured you. But, as in proof of this you bring me only facts and figures, you will see of course that it is quite unnecessary for me to notice such arguments; for, however plainly it might from them appear that your scheme is practicable and must ultimately liberally repay your advances, yet, this conclusion being proved by reasoning, is a theory, and that theory having the disadvantage of not being drawn like mine from general axioms, and being merely a laborious deduction from particular observations, it must of necessity follow from indubitable philosophical principles, that it is wrong, and mine right. The case being so, you are, I hope, men of too good sense to dispute the matter farther. Should you however persevere I must take the liberty of telling you that you are too narrow-minded theorists, and that, by interfering, in the manner you are about to do, with the natural course of events, you will infallibly waste the resources of your infant community, and retard its prosperity."
I apprehend such philosophic arguments would not have had much success with them or other men of practice, and that, even should we take the procedure adopted by individuals, as a fit model
for that of nations, we would not find that it altogether agreed with the rules which the doctrines of Adam Smith inculcate. The reason is, that individuals, as well as nations, acquire wealth from other sources than mere saving from revenue; that skill is as necessary, and consequently as valuable, a cooperator with the industry of both, as either capital or parsimony; and that therefore the expenditure which either may be called on to make to attain the requisite skill, is very well bestowed.
But, though skill is valuable both to nations and to individuals, there are many circumstances that render it more so to the former, than to the latter. In the first place, it is more durable. Whatever may be the perfection to which an individual may have brought his skill, dexterity, and judgment, in conducting any particular set of operations, that perfection perishes with him. Whatever expense it may have cost him to acquire this possession, and however valuable it may be to himself, he cannot transmit it to his heirs. But any addition which a society makes, to the skill dexterity, and judgment, with which its members exercise any branch of industry, is not of this fleeting nature. Instead of the
benefits derived from it, being bounded by the short space of time that the active life of an individual embraces, they are continuous with the national existence. If it be worth while paying a considerable apprentice-fee, for the acquisition of an art, which can probably only be exercised for twenty or thirty years, it must be better worth while to pay for one, the advantages derived from the possession of which, may be retained for hundreds or thousands of years.
Again, whatever an individual may expend in acquiring any degree of skill is, to a certain extent, lost to him; though he may draw a revenue, he cannot draw a capital from it. No portion of the future skilled labor of an individual can he sold, because it can only be sold with himself, and such bargains, sanctioned in ancient, are not so in modern times. No where can one effectually make over his services for a certain time to any other person, because, no where can he give that person the power of enforcing their exertion. On the contrary, any portion of the future revenue, yielded by the skilled industry of a nation, may be sold, and, consequently an addition to the national skill gives a proportional addition to the command of national resources, to meet any sudden emergency. The produce of the general industry of Great Britain, stands mortgaged for a sum, which it would have appeared a century ago utterly impossible to conceive that industry could sustain, because, a century ago, it was impossible to conceive the vast increase which has since been made to the skill, dexterity, and judgment, with which it was then directed.
Besides these and other differences between the effects resulting from the acquisition of skill in the pursuits of industry by nations, and by individuals, there is one on which I have already enlarged. An increase of skill seems to be always a necessary concomitant of the increase of national wealth, whereas it is not always a concomitant of the increase of individual wealth. It is not therefore true, that nations and individuals increase their wealth in the same manner, nor, were it so, do the rules, which modern political economists lay down for the increase of national wealth, agree with those which individuals adopt in their endeavors to augment their private stocks.
The main arguments, however, which the author brings forward, are built on what he assumes to be general principles. The doctrine lie maintains throughout his whole system, and more particularly in the chapter to which I have alluded, turns on the following passage.
"If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage. The general industry of the country being always in proportions to the capital which employs it, will not thereby be diminished, no more than the capital of an artificer is diminished who purchases an article from another practising a different art instead of making it himself. It will only be left to find out the way in which it can be employed with the greatest advantage. It is certainly not employed to the greatest advantage, when it is thus directed towards an object which it can buy cheaper than it can make. The value of its annual produce is certainly more or less diminished, when it is thus turned away from producing commodities evidently of more value than the commodity which it is directed to produce. According to the supposition, that commodity could be purchased from foreign countries cheaper than it can be made at home; it could therefore have been purchased with a part only of the commodities, or, what is the same thing, with a part only of the price of the commodities, which the industry employed by an equal capital would have produced at home, had it been left to follow its natural course. The industry of the country, therefore, is thus turned away from a more to a less advantageous employment; and the exchangable value of its annual produce, instead of being increased, according to the intention of the law-giver, must necessarily be diminished by every such regulation.
"By means of such regulations, indeed, a particular manufacture may sometimes be acquired sooner than it could have been otherwise, and after a certain time may be made at home as cheap, or cheaper, than in the foreign country. But though the industry of the society may be thus carried with advantage into a particular channel sooner than it could have been otherwise, it will by no means follow that the sum total either of its industry or of its revenue, can ever be augmented by any such regulation. The industry of the society can augment only in proportion as its capital augments, and its capital can augment only in proportion to what can be gradually saved out of its revenue. But the immediate effect of every such regulation is to diminish its revenue; and what diminishes its revenue is certainly not very likely to augment its capital faster than it would have augmented of its own accord, had both capital and industry been left to find out their natural employments.
"Though, for want of such regulations, the society should never acquire the proposed manufacture, it would not upon that account necessarily be the poorer in any one period of its duration. In every period of its duration its whole capital and industry might still have been employed, though upon different objects, in the manner that was most advantageous at the time. In every period
its revenue might have been the greatest which its capital could afford, and both capital and revenue might have been augmented with the greatest possible rapidity.
"The natural advantages which one country has over another, in producing particular commodities, are sometimes so great, that it is acknowledged by all the world to be in vain to struggle with them. By means of glasses, hot-beds, and hot-walls, very good grapes can be raised in Scotland and very good wine, too, can be made of them, at about thirty times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of claret and burgundy in Scotland? But if there would be a manifest absurdity in turning towards any employment thirty times more of the capital and industry of the country than would be necessary to purchase from foreign countries an equal quantity of the commodities wanted, there must be an absurdity, though not altogether so
glaring, yet exactly of the same kind, in turning towards any such employment a thirtieth, or even a three hundredth part of either. Whether the advantages which one country has over another be natural or acquired, is in this respect of no consequence. As long as the one country has those advantages and the other wants them, it will always be more advantageous for the latter rather to buy of the former than to make. It is an acquired advantage only, which one artificer has over his neighbor who
exercises another trade; and yet they both find it more advantageous to buy of one another, than to make what does not belong to their particular trades."
I must be excused for running somewhat into repetition in observing, that the strength of this passage evidently lies in the axioms, "The industry of the society can augment only as its capital augments, and its capital can augment only in proportion to what can be gradually saved out of its revenue;" and that the proper answer to these axioms is, either, that they prove nothing, or, that they prove it by a begging of the question, by assuming that to be proved which is in process of proof. The expression, the industry of the society can augment only as its capital augments, may signify, either, that the augmentation of a society's capital, and an increase of its productive industry always accompany each other; or, that every augmentation of the productiveness of the general industry, is produced by an augmentation of capital, and can be produced by nothing else. In like manner, the expression, the capital of the society can augment only in proportion to what can be gradually saved out of its revenue, may signify, either, merely that the saving from revenue is a necessary part of the increase of the general capital, and measures its amount, or, that there are no other means of augmenting its capital but it. In the former of these two senses the axioms prove nothing; in the latter they prove all things desired, because they assume them as acknowledged truths. The double meaning of the assumptions contained in these axioms, and the fallacy into which they may, in consequence, be made to lead, may be easily perceived by an application of them to the transactions of an individual.
A person residing in England, owns an estate in the West Indies, which he proposes to visit. His motives to do so are, that he thinks, that, by his personal superintendence, he can give a better direction to the industry employed on it, and render the returns greater. In order to do so, it is necessary for him to procure and expend a certain sum to pay for the expense of the voyage, and the cost of the various articles which his private accommodation will require there, and he therefore takes
measures to apply to this purpose a considerable part of one year's revenue of the estate. On account of this disbursement, some one objects to the project, and endeavors, in the following manner, to prove to him that it must be hurtful to his interests:
"The augmented productiveness of your estate, and the increased amount of capital at which it will be estimated, must go on together. But, to add to capital, it is necessary to save from revenue. Now the scheme you are about to embark in requires first a large expenditure of revenue. It must therefore tend to prevent your augmenting your capital, and consequently the productive industry of your estate, which two things always go on together." The answer to this reasoning would be: "It is
chiefly because I am aware that the productiveness of my estate, and what it is worth, are inseparably conjoined, that 1 am about to be at this expense and trouble, for I believe they will enable me to put things in such a train that its productiveness will greatly increase, and, as its value I know depends on the. revenue it yields, my capital will consequently be augmented by much more than the sum I am going to expend."
"I perceive I have not expressed my meaning properly," replies the adviser, "I should have said; an increased productiveness of your estate, can be produced by no other means than by an augmentation of the capital employed on it, and the amount of capital you can possess and can employ on it, can be augmented in no other way than by saving from your revenue. But this plan of yours causes an expenditure of your revenue, it must therefore prevent you from adding to your capital, and, consequently, from increasing the productiveness of the industry which is set in motion by it on your estate."
The West India proprietor might undoubtedly reply: "My dear Sir you are completely wrong. The productiveness of my estate depends, not only on the amount of the capital which sets the industry employed on it in motion, but on the sort of motion it gives it; and I hope so to improve this, by a more judicious regulation of it, that the same power will produce a far greater effect than it does at present, and thus to show you, that there are other means of augmenting capital than simple saving. For I take it, that if I add to my gains, without increasing my expenditure, the procedure may be just as effective to this end, as if I were to diminish my expenditure, and not add to my gains.
If we understand the axioms of our author in the former sense of the expressions, it is clear, that when applied to national capital, they prove nothing more than when applied to individual capital.
For, if it be merely meant that the productiveness of national industry, and the augmentation of national capital advance together, the propriety of a proposed measure may as well be inferred from
its tendency to render the industry of the community more productive, as its impropriety may be inferred from its requiring a small immediate expenditure of revenue. The question to be determined in every such case, would then be similar to that which an individual determines when deliberating on any scheme for the augmentation of his private capital, and would resolve itself into an inquiry, whether or not the probable returns from the proposed measure, be likely to be a sufficient remuneration for the expense of carrying it into effect. But, it is very clear, that this would be a constrained interpretation of the import of the passage; and that the inference the author wished his expressions to convey, is, that an increased productiveness of the industry of the society can be produced by no other means but by augmenting its capital, and that the only means entering into the process of augmenting its capital are saving from its revenue.
The proper answer to these axioms, so understood, is, this is your theory no doubt, but it is a theory which is merely in process of proof, and not yet established. Surely, then, it is scarce logical to answer a very obvious objection to it, which the observation of human affairs presents, by assuming its truth; or, to deduce the impropriety of a practical measure, drawn from the phenomena which human affairs present, and apparently very beneficial, by showing that such measure is contrary to its principles.
The question hitherto stands thus. You pretend to account for the phenomena of the augmentation of national wealth by showing, that an increase of national capital tends to facilitate the
division of labor; that this division of labor in itself greatly improves the productive powers of labor, and is the cause of all other improvements in them. That this increase of the productive powers of labor, being equivalent to an increase of the revenue of the society, adds to its power of accumulating fresh capital and giving farther extent to the division of labor, the great generator, according to your system, of all wealth. It is in this way that, according to you, the augmentation of the industry of the society is produced by an augmentation of its capital, and in no other manner, and its capital augmented by saving from revenue and nothing else, and that, from the action and reaction of these
principles on each other, the whole phenomena of the growth of national capital are deducible.
Now, admitting for the present that no fallacy can be detected m the principles themselves, they must still be admitted to be only possible or probable theoretical assumptions, to be proved by the observation of their coincidence with facts. Admitting then also that., as far as the facts which relate to what we may call the history of the internal progress of national wealth are concerned, they sufficiently accord with them, there is another class of facts admitted by you, which these principles do not explain, and to which, on the contrary, they seem to be opposed.
Arts and manufactures, the great sources of increase to the productive powers of labor, do, it is granted, pass from country to country. It would appear then, that the gradual increase which the accumulation of capital produces on the productive powers of any society, is not alone sufficient to call forth all the resources which that society possesses; but, that it is often necessary to seek in other countries for the means, which give these resources full efficiency. In such cases, at least, therefore,
the augmented wealth of the society cannot be said altogether to flow from the gradual increase of its capital by accumulation, the consequent division of labor, and the improvements thence resulting. Your theory is, therefore, so far most certainly defective, as it acknowledges the existence of a class of phenomena, the laws regulating which its principles by no means explain.
Instead, however, of attempting to answer the objections to your system, which this class of phenomena present, you pretend to say, that the practical rules directly, and in the simplest manner, deducible from them, are of necessity erroneous, because contrary to the principles of your system. It being acknowledged by every one, even by yourself, that the improvements of the productive powers of labor thus effected by the continued spread of the arts of civilized life from country to country, are among the chief causes of the progress of national wealth and prosperity, they who have had the management of national affairs, have in different cases come to the unavoidable conclusion, that they did well in even sacrificing a small portion of the national revenue, provided this outlay served to introduce acknowledged improvement in the national industry, and source of national wealth. They have acted in this as an individual would do in the management of his private affairs, they have endeavored to introduce an improvement into the management of the funds with which they
were intrusted, and have considered the price to be paid for such improvement warranted by the increased productive powers it would give to the same capital, and consequent increase to the national revenue, and national funds, which it would tend to produce. Like individual schemes their projects seem sometimes to have succeeded, and sometimes to have failed. But though, when he acts, it is incident to man's imperfect nature occasionally to err, to sit down therefore in resolute inactivity would be the worst error he could commit.
The celebrated author admits, that a manufacture may be introduced by the operations of the legislator, sooner than it could, otherwise be, and thus come to be made at home as cheap, or cheaper, than abroad. But then, he says, in spite of these apparent advantages of such a proceeding on his part, it must be wrong, because it is contrary to my system. And, before you can prove that it is justifiable, you must prove that the benefits resulting from it could not possibly have happened some other way. "Though, for want of such regulations, the society should never acquire the proposed manufacture, it would not upon that account necessarily be the poorer in any one period of its duration. In every period of its duration, its whole capital and industry might still have been employed, though upon different objects, in the manner that was most advantageous at the time. In every period its revenue might have been the greatest which its capital could afford, and both capital and revenue might have been augmented with the greatest possible rapidity.
Now, I conceive, that instead of calling on his opponents to prove, that all the advantages arising from any such scheme might possibly come to pass without it, he himself has to show, that they must come to pass without it. And, that he has to do so, not by assuming his theoretical principles as true, for, if they are so, his axioms embrace and decide this and every case at once,but by an examination of the course of human affairs, and a regular deduction from them, of the certainty of these apparent advantages, or others equivalent to them, flowing in from some other channel than that of which he would bar the opening.
A nation imports from a distance a manufactured commodity, which it is granted it could make as cheap, or cheaper, at home, were the manufacture introduced there. To introduce the manufacture is, however, too expensive a project to be carried into effect by any private individual. The whole society might do so, through the expenditure for a few years of a portion of its revenue, much less than what an equal number of years succeeding them will return to it in the diminished cost of the article. He, or they, who legislate for the society, embrace the apparent benefit, and, by means of a small expenditure, effect an increase of the productive powers of the community; that is, they give those powers the capability of producing the same quantity of an article with less expense, which certainly must be allowed to be an increase of them. In this the legislator acts in a manner that would be accounted prudence in a private person, who conducted any system of industry for his own emolument: in a planter; for instance, who owned and managed a West India estate. We should undoubtedly approve of such a person's being at considerable expense, in instructing his overseers and negroes, in any improved mode of conducting the business of the plantation, if this improvement more than proportionably augmented his revenue. Neither have the proceedings of legislators, in many cases parallel in principle to this, been ever objected to. It sometimes happens, for instance, that those engaged in cultivating the ground know that they can procure seeds of plants, or races of animals, at a distance, better fitted for their purposes than those they have at home. If the expense of procuring them is small, and such as will be remunerated to an individual by the gain, individuals send for such seeds and animals. If it is greater, they sometimes club in societies for the purpose. If it be too great for these societies, the legislator aids them in their scheme, or carries it into effect himself. In this way it was, that, it being thought that the culture of the bread fruit tree, a plant indigenous to the Pacific Ocean, could it be introduced into our West India Islands, would be of advantage to them, government were at the expense of sending more than one vessel, on that long voyage, in order to transport the plant there. No one did, or could object, to the outlay of a portion of the public revenue for a purpose so laudable. In this instance, it will be allowed by all, that it would have been as absurd to have waited in expectation that some individual should find, or should imagine he would find it for his own private advantage to undertake so expensive a scheme, as it would be to complain of the comparatively trifling expenditure of the common funds, which the accomplishment of this project
conducive to the common good required. But the expenditure of a certain amount of national revenue, for the purpose of transporting an useful art from a distant country, bears, surely, a close analogy to a similar expenditure, for the purpose of transporting an useful plant. If the one be praiseworthy, the other can scarce deserve the censure that has been heaped on it.
Our author further observes: "The natural advantages which one country has over another, in producing particular commodities are sometimes so great that it is acknowledged by all the world to be in vain to struggle with them." And, as an instance, he gives the project of raising grapes, for the purpose of making wine, in Scotland.
Extreme cases are useful, but, to be so, they should be correctly put. The main question in dispute is, whether or not it is proper to introduce a manufacture from abroad, by the aid of the legislator, which, when so introduced, will furnish a commodity for home consumption at as low, or at a lower price, than it can be bought for in the foreign country. The supposed case of a commodity which, if the manufacture of it be introduced at home, will cost thirty times more, or a thirtieth, or three hundredth part more there than abroad, can have nothing to do with the determination of such a question.
"Whether the advantages which one country has over another be natural or acquired, is in this respect of no consequence." On the contrary, in my opinion, it is of the greatest consequence, and, for this very reason, that it is only "as long as the one country has those advantages, and the other wants them, that it will be more advantageous for the latter rather to buy of the former than to make." Now natural advantages cannot be procured by any expenditure of revenue or capital, but acquired advantages may often be got by means of a very small expenditure. One country cannot, at any purchase, acquire the soil, the climate, the commodiousness of situation for conducting trade, or any of the other natural advantages which another country possesses; were it so, the price would be very large that would not be willingly paid for them. But one country can often with ease, and at a trifling expense, acquire the practical skill and the knowledge of particular arts and manufactures which another possesses, and, by doing so, gain the advantage of procuring for itself the products of this skill and knowledge at home, instead of having to go abroad for them. In the passage quoted, natural
advantages and acquired are reckoned equivalents, and so undoubtedly they are. They are both valuable on account of the products they yield to human labor. But they differ in this, that the latter can be transferred from one country to another, the former cannot. Could Scotland acquire the sunny skies and more genial climate of France, its hills might be covered with vineyards, instead of heather, and its inhabitants might procure many commodities at a fourth of the price which they now cost them. No one would object to a considerable expenditure to acquire so great an advantage. If then, the acquisition of natural advantages would be worth paying for, why object to a small expenditure to procure advantages which are allowed to be equivalent to those natural advantages?
As the author has given one supposed case, as he conceived illustrative of the question, I may be permitted to give another, also illustrative of it, not like his, however, springing from assumptions liable to be objected to, but, as will be seen, framed upon his very principles and admissions.
A certain country has the acquired advantage over another of possessing the knowledge of a particular art, which this other wants. The latter, therefore, imports from the former all the goods, the product of that art, which it has occasion for. As it has to pay for these goods, it luckily happens that it, on its side, has also acquired advantages in possessing the knowledge of another art, which the former wants, and the commodities produced by which it has occasion for. In this way, the one sort of goods pays for the other. The natural and acquired advantages of these two countries are either similar or equivalent. That is, their soil, climate, convenience of situation for trade, and their
knowledge of other arts, though not exactly the same, are on the whole equally balanced, their population and capital are equal. In short, they as much resemble two neighboring artificers, according to the comparison of our author, exercising different trades, as extensive communities inhabiting separate countries well can resemble single workmen whose dwellings are contiguous. The peculiar manufacture of the one nation is hats, of the other silk goods. The silk goods which the one annually consumes cost it £2,000,000; the hats which the other consumes, the same sum. Of these sums 25 per cent. is made up of transport, including in the term, not the mere freight, but the whole charges paid for internal transport, for warehousing, and for the profits of the different capitals, and wages of the various individuals concerned in collecting the commodities in the one country, carrying them to, and distributing them over the other. Thus the annual sum which these commodities cost each country, over and above the expense of producing them, is £400,000. In this situation things have long remained, and must continue to remain, unless altered by some change in the policy, or great revolution in the affairs of the two countries. "It being only for the sake of profit that any man employs a capital in the support of industry," and, from the acquired advantages which each country enjoys over the other in the production of its peculiar manufacture, it being impossible for any projector to manufacture hats, in the country where hats have not hitherto been made, or silks, in the country where silks have not hitherto been made, but at an outlay of more than 25 per cent over what they cost in the country where these respective manufactures are established, no such project will be entered on. The legislators of the two countries, have hitherto agreed with our author, that, as it is the maxim of every prudent master of a family, never to make at home what it will cost him more to make than to buy; what is prudence in the conduct of every private family can scarce be folly in that of a great kingdom; and that, whether the advantages which one country has over another be natural or acquired, is of no consequence, it being an acquired advantage only, which one artificer has over his neighbor, who exercises another trade, though they both find it for their advantage, rather to buy of one another, than to make what does not belong to their peculiar trade. Acting on these principles, they have thought it improper to make any alteration in the system.
About this time however a change takes place in their opinions, and they begin to think, that as, though it would not be very prudent in the tailor, that he might have his shoes made in his own workshop instead of his neighbors, to set about making them. himself, or the shoemaker, for the same reason, to set about making his own coat, yet, if there were a town in which there were no shoemakers, but more than enough of tailors, and another, a dozen miles off, in which there were no tailors, hut more than enough of shoemakers, it would be a beneficial change for some of the tailors to remove to the one town, and some of the shoe-makers to the other, that the inhabitants of both might have the articles fabricated by these different sorts of tradesmen, made at home, that is, within their respective towns, so, two countries, of which the one made no hats, and the other no silk goods, might mutually benefit by the introduction of the manufacture in which each was deficient, the inhabitants of each in like manner as the inhabitants of each town, having that provided at home, which they must otherwise go abroad for, and thus being saved like them, the expense and inconvenience of transportation.
Though such a change, in either case, could not he brought about without expense, and though "its immediate effect would therefore be to diminish the revenue of the society," yet, as after
a certain time, it would be likely that the new manufacture would be made at home in each case "as cheap or cheaper than abroad," its ultimate effect would be, more than proportionably, to increase the revenues of both towns and both countries.
Acting on these new views, the legislators of both countries, about the same time, commence encouraging the manufactures in which their respective countries are deficient; and, by means of a system of premiums, bounties, and duties, on the detail of which it is unnecessary to enter, in the course of years, succeed so far, that silk goods come actually to be fabricated in the country where no silk goods were manufactured, as cheaply as where they were exclusively manufactured, and hats to be made, where no hats were made, as cheaply as where hats were exclusively made. Part of the capital and industry which went in the one case to the manufacture of hats, goes to manufacture silk goods, and, in the other case, part of the capital and industry which went to manufacture silk goods, goes to manufacture hats. Both countries produce that at home, which they before imported from abroad, and are therefore saved the expense attending that importation.
Completely to effect this change requires an outlay, in both cases, of £1,000,000. Being effected however, it of course saves each country the expense of transport, which, at 25 per cent on the imported goods, makes an annual saving of its expenditure, and increase therefore of its revenue, of £400,000, so that, in two or three years time, the sum expended is repaid, and each community supplied with a new fund to furnish additional comforts to its members, or to add to their capital. According to our author's tenets, this proceeding of both legislators, although admitted to be practicable, is yet held to be necessarily, and in its very nature, injurious.
Although it can seldom happen, that two countries are so circumstanced that both, according to our supposition, can benefit equally by the effecting of such a change, yet, if one effect such a change, as far as that country is concerned it would seem to be beneficial, on a simple calculation of expense and gain, provided the saving of revenue produced by it, is greater than the expenditure of revenue necessary for producing it. It is this end which the legislator generally aims at reaching by the regulations he imposes on the trade and industry of the society, and which, by these means, he often arrives at. Yet, even when in such cases successful, our author maintains, that his proceedings are necessarily, and essentially prejudicial to the interests of the society. That, even though they may cause a commodity to be produced at home, cheaper than abroad, they must diminish, instead of augmenting, the national revenue and riches. A conclusion so extraordinary, is arrived at by a process of reasoning as extraordinary. It is come to by setting out from it. Two general axioms, somewhat ambiguous and vague, are assumed as truths. As usually happens to all other axioms employed in general reasoning, and capable of conveying two senses, they are granted in the one sense, and applied in the other. We assent to the propositions, "the industry of the society can augment only in proportion as its capital augments, and its capital can augment only in proportion to what can be gradually saved out of its revenue," because we see, that the augmentation of industry and capital, the saving from revenue and increase of capital, are concomitants of each other; we perceive not, that in the application of these propositions, the sense in which we assented to them is abandoned, and that the augmentation of the capital of the society is assumed as the cause, and the sole cause of the increase of its industry, and the saving from revenue, as the cause, and the sole cause, of the augmentation of its capital. Whereas, from the observation of the increase of the productiveness of national industry, and of the amount of national capital, going on in general together, we may at least as justly infer that it is the industry which augments the capital, as the capital the industry, and rather come to the conclusion, that part of the national resources should be employed in giving perfection to the industry of the society than that they should be altogether devoted to attempts to increase its capital. In fact, as capital, according to Adam Smith himself, is only valuable for the addition it makes to the efficiency of the national industry, and, as that efficiency is also, according to him, mainly dependent on the skill, dexterity, and judgment, with which it is applied, an expenditure of capital or revenue, having the effect of increasing the national skill, dexterity, and judgment, would seem to be the most judicious possible, seeing it directly increases those sources of production, from the indirect addition that it makes to which, capital is said to derive its sole value.
It has been my endeavor to show, in the preceding examination of the system of Adam Smith, that the doctrine there maintained, of the expediency of the legislator's abstaining from any attempt to give increased efficiency to the industry of the society by encouraging the growth of domestic arts or the importation of foreign, founded on the supposition of the perfect identity of the means which add to the wealth of individuals and nations, is erroneous.
1. That the reasons which make it assume the form of a self-evident principle, have their foundation in the ambiguities of language alone, and that, in reality, the presumption is against, not for it.
2. That viewed as a consequence of the theory of the accumulation of capital, the division of labor, and the improvements resulting from the action and reaction of these principles on each other, the judgment we form of it must be altogether determined by the probable accuracy of the principles on which that theory proceeds, and by its coincidence with facts; that granting, for the present, the apparent probability of the theoretical principles themselves, they nevertheless do not agree with the phenomena; that there is a class of admitted facts, which they not only do not explain, but to which they are in opposition; that the increase of the wealth of every community is acknowledged to be dependent, not only on the accumulation of capital and division of labor among its members, but also on the progress of arts in other communities, and their subsequent transfer to it; that to effect this transfer, a measure admitted to be all-important to the prosperity of the community, the efforts of individuals are insufficient, that, in his endeavors to prove that the legislator ought not here to interfere, Adam Smith runs into inconsistencies and contradictions, and that there hence arises a proof of the inapplicability of his doctrine to events of this order, and a strong presumption of the existence of some fundamental error in the general principles of his system.
BOOK II.
OF THE NATURE OF STOCK, AND OF THE LAWS GOVERNING ITS INCREASE
AND DIMINUTION.
INTRODUCTION.
Dugald Stewart prefaces the observations he makes on Adam Smith's great work, with the following remarks: "An historical review of the different forms under which human affairs have appeared in different ages and nations, naturally suggests the question, whether the experience of former times may not now furnish some general principles to enlighten and direct the policy of future
legislators? The discussion, however, to which this question leads, is of singular difficulty; as it requires an accurate analysis of by far the most complicated class of phenomena that can possibly engage our attention, those which result from the intricate and often the imperceptible mechanism of political society; a subject of observation which seems, at first view, so little commensurate to our faculties, that it has been generally regarded with the same passive emotions of wonder and submission with which, in the material world, we survey the effects produced by the mysterious and uncontrollable operation of physical causes."(31) The science of Political Economy he considers as a part of this great subject.
If the accuracy of these observations be admitted, as I think it must, the inquiries in which Political Economy engages, lead to the investigation of the general principles of human action, and it is to be considered but as a branch of a larger science, having for its object, to trace the laws to which man is subject as a moral and intellectual animal, acted on by the system of things existing in the world, and acting, in turn on them, to explain from those laws the events which his past history, as far as known, exhibits, and to collect the means of ascertaining what will be the future course of it. While to be able clearly to unfold the laws regulating the events with which it deals would imply the capacity of tracing those regulating the whole system of phenomena of which man is the centre, just as to explain with accuracy the laws regulating the motions of one of the heavenly bodies, implies the knowledge of principles capable of disclosing the prescribed movements of them all.
I have already observed, that the subject first met me when engaged in the investigation of some principles which I conceived might in time assume a form capable of a general application of
the sort. To attempt here an extensive generalization of this kind would be out of place, and is impracticable, because of necessity only a small portion of the phenomena are before us. Political Economy itself makes but a part of the subject to which such generalizations belong, and it is only one division of political economy of which we are to treat. It has usually been discussed under the heads of stock, wages of labor, and rent, and it is to the first of these that our investigations are to be altogether confined. It is only therefore in such parts of the subject as present a sufficient mass of phenomena, to warrant the procedure, that I shall attempt to introduce any very general principles. In other cases I will confine myself to the simple statement of facts admitted by all parties.
.
CHAPTER I.
It is characteristic of man to provide for the events of the future, by the formation of instruments; and his power to make this provision, is measured, by the extent and accuracy of his knowledge of the course of natural events.
Cicero gives the following summary of the principles exciting man to action, and of the mode in which they lead him to act: - "inter hominem et beluam hoc maxime interest, quod haec tantum, quantum sensu movetur, ad id solum, quod adest, quodque praesens est, se accommodat, paullulum admodum sentiens praeteritum, aut futurum. Homo autem, quod rationis est particeps, per quam consequentia cernit, causas rerum videt, earumque progressus, et quasi antecessiones non ignorat, similitudines comparat, et rebus praesentibus adjungit atque annectit futuras: facile totius vitro cursum videt, ad eamque degendam praeparet res necessarias. Eademque natura vi rationis hominem conciliat homini et ad orationis, et ad vitae societatem: ingeneratque in primis praecipuum quendam amorem in eos, qui procreati sunt: impellitque, ut horninure coetus, et celebrationes, erse, et a se obiri velit: ob easque causas studeat parare ea, quae suppeditent et ad culture, et ad victurn: nec sibi soli, seal conjugi, liberis, ceterisque, quos cards habeat, tuerique debeat."
"The chief distinction between man and the inferior animals consists in this. They are moved only by the immediate impressions of sense, and, as its impulses prompt, seek to gratify them from the objects before them, scarce regarding the future, or endeavoring from the experience of the past to provide against what is to come. Man again, as he is endowed with reason, by which he is able to connect effects with their causes, to perceive the principles which guide the progress of affairs, and to join together the present and the future, easily discerns the course of his whole life and prepares whatever may be necessary for passing it in comfort. The same intellectual powers also, which nature has bestowed on him, give scope to his affections, and join him to his fellows by the ties that spring form language and the connexions of social life. It is from this source that we must trace his peculiar provident love for his offspring, his concern for the interests of society, and his desire to mingle in its business and pleasures.
"From these principles it is that man is incited and enabled to provide beforehand whatever may be requisite both for utility and ornament, not only to himself but to his wife, his children, and all others who may be dear to him, or whom it may be his duty to protect."
It is unquestionably the capacity for perceiving and retaining in his mind, the course of events and the connexion of one with another, that leads man to perceive what advancing futurity is to bring forth, and enables him to provide for its wants. The provident forethought distinguishes him from the inferior animals, and the degree in which he possesses it marks his rank in the scale of civilization.
When he has gained any knowledge or the nature of things around him, he finds many that satisfy more or less perfectly his present wants. He knows also that if he live to see the future he will then have similar wants and desires. Some of the things satisfying his desires and wants exist abundantly, others sparingly or imperfectly. If he regard the future, he must wish that those things of which he now can only obtain them to satisfy his wants sparingly and imperfectly, should exist then, so as that lie might be able to obtain them to satisfy those wants abundantly and perfectly.
His faculties of observation and reason generally give him the power of effect this. For these objects of his desires are mere arrangements of matter. His faculties of observation show him their nature, and the manner in which the train of events going on amongst them succeed each other. He perceives that the things which are the objects of his present wants, or which were of those he felt a little time since, amt which will probably. Be of those be will feel in fixture. are either the immediate result of the nature and form of some things around him, or of the trains of events which, in consequence of that form and nature, are taking place among them. He cannot alter the nature of things. but, in many cases, be is able to change their form, that is, the particular arrangement of the matter of which they are formed, and his reason instructs him, that if, by doing this, he can so alter the trains of events proceeding from them or depending on them, that they may either form, or cause to be formed, or put in his possession, objects fitted to supply more perfectly or abundantly what probably will be his future wants, than those objects would otherwise exist, he then is able to provide for the future. This in many cases he can do, and thus he acts.
A North American Indian in his canoe comes to an island in some lake or river, and finds near it a good station for fishing. He therefore determines to remain there for the fishing season. Towards evening hb paddles his canoe to shore, lands, kindles a fire near a large tree, wraps his blanket about him, places his feet to the fire, his head to the trunk of the tree, and thus prepares for repose. In so doing, with the exception of kindling the fire, he takes advantage simply of his knowledge of the nature of the things around him, and seeks from them the best supply they can give him of what he wants, that is, of shelter from wind and weather.
It rains and blows during the night, the tree shelters him somewhat, but still he gets cold and wet. In the morning he spends some hours providing a better shelter against the inclemency of any such night in future. Of branches and bark he makes something like one half of the roof of a house, only much smaller, the open side being towards the south and the fire, the sloping side towards the north from whence comes cold and rain. Thus, though he cannot prevent the wind from blowing, or the rain from falling, his knowledge of the manner in which the trains of events forming these phenomena succeed each other, or if you will, his knowledge of the laws which regulate their motions, instruct him so to direct them, that the one shall not blow, or the other fall, on a particular spot, which he knows he may at some future time wish to remain calm and dry. This time may be distant, for it may not rain or blow so as to inconvenience him for a week or two, nevertheless to provide against it he gives a good many hours present labor.
Next evening, before going to repose, he finds the turf damp from the rain of the former night. He looks for an elm tree, cuts off a piece of its strong thick bark large enough for him to sleep on, covers it with the soft branches and leaves of the white pine, and forms a dry and soft bed for himself. Thus his knowledge of the materials around him enables him to form what he wants, a dry and soft place of repose.
In this island he discovers a small wild plumb tree, he relishes the fruit, but there is little of it. Resolving to return in succeeding seasons he lops the branches of the surrounding trees to give this room to spread, and expects thus to find next year a more abundant crop.(32) Here his knowledge of the manner in which trees and fruit grow and thrive, or his knowledge of the order of the trains of events which terminate in the full development of the tree and abundance of its fruit, enables him so to work on the matters around him, as to occasion them to produce more abundantly next season, than they have this, what then he will desire.
He thinks not of providing for any future want the means to supply which, will, without this, exist in sufficient abundance. Thus water, in such a situation, he knows he will always be surrounded with. Were the same Indian encamped in the woods, by a very scanty spring, he would dam it up, and cover it with branches so as to keep cool a quantity of water for his future occasions.
The proceedings of man are every where similar. He has always an end in view, he employs means to effect this end, and there is a manner through which he effects it. The end is a supply for future wants; the means, the bringing about of such events as may serve to supply them; the manner, a knowledge of the qualities with which nature has endowed the materials within his reach, of the series of events in consequence arising among them, and an application of this knowledge to produce, through his corporeal powers, such an arrangement of these materials, as may so change the issues of events that would otherwise have place, as to bring about those which he desires. It is true, that, in most instances, men simply copy the proceedings of others, and think not of the principles on which they conduct their operations, nor of the observations from which these must originally have been deduced. But, though the knowledge thus acquired from this storing of observations, and deduction of principles from them, is not the mode in which individual men operate, it is the mode in which the operations they carry on must have been first brought into practice, and on which they are all founded.
We may easily satisfy ourselves of this, by turning our attention to the manner in which any of the articles we use for the supply of our wants has been formed. Bread may be an example. A farmer, some two years ago, made choice of a particular field for the cultivation of wheat. Had he been asked why he did so, he could have stated the different circumstances in the soil, and the previous crops that it had carried, which had thus determined him. By ploughing and harrowing it a sufficient number of times, he thoroughly broke, and pulverized the land. This he did, because he knew, from observations he or others had made, that in this state the seed he intended to deposit there would, when it came to germinate, more easily spread its roots around, and draw nourishment from among the particles of earth amidst which it would grow. He allowed a considerable time to elapse between the several operations, that the weeds might have time to spring up, and be destroyed. Thus he knew they would be prevented from afterwards injuring the growth of the crop. He also spread over the field, and covered in, a quantity of manure, because experience had taught that this substance gives vigor to vegetation. He then sowed the seed, in the mode, and quantity, and at the time, which observation had instructed him was the best, covered it with a harrow, and waited the harvest. When he perceived the grain sufficiently ripe, he cut it down with an iron hook having a form and edge which experience had ascertained to be best adapted for this purpose, made it into bundles, exposed them to the sun and air so that they might be dried, when this was effected, conveyed them to his barn and stored them there. Having lain there some time, the grain was separated from the straw by the process of threshing, it was then carried to the granary, where, having been kept for a longer or shorter period, it was thence taken to the mill, and, by a very ingenious process, reduced to small particles, and then separated by another process into three parts, of which the finest part, the interior of the grain called flour, being packed in sacks or barrels, was preserved for use. A certain portion of this, mixed with a particular ferment, wrought with the hand and exposed to the action of fire, became bread.
It is very evident, that all the steps of these various processes depend on a knowledge of the course of natural events, and are regulated by that knowledge. A long series of observations of this sort, and of reasons deduced from them, could alone have enabled the farmer to prepare the ground properly for the seed, or, after the grain had come to maturity, to preserve it, to separate it from the straw, and fit it for being converted into flour. The observations on the trains of events connected with the production of this grain that have been committed to writing, fill many large volumes, and besides these, every farmer is obliged to have a great store of his own, to guide him in his proceedings. Thus, in the single process of cutting down and storing up this crop, his success in securing it uninjured depends on observing and noting well a great variety of particulars. He observes the plant carefully, and discovers, from the appearance of every part, from the dryness of the stem, the drooping of the ears, the fulness of the grain, if it be in a proper state to cut down. If he make any error in this, he will either have unripe, and therefore shrivelled and light grain, or he will lose great part of it by its being shaken off the stem in harvesting it. Next, before he determine on commencing the operation, be regards the aspect of the sky, watches the rising and setting sun, notes the color of the air, the appearance of the clouds, the direction of the wind, the dew on the grass, and perhaps has recourse to that delicate instrument, the fruit of so many ingenious observations, the barometer. By means of all these, he is enabled to draw tolerably correct conclusions, in regard to the probable state of the weather for some succeeding days. This knowledge influences greatly his farther operations; for experience has taught him that the injury which severe rains, calming on the grain when newly reaped, would occasion, is very great. if, therefore, the weather promise to be fine he will commence cutting it down a few days sooner than he otherwise would; if rain threaten he will wait a few days longer. When he has it reaped he gets it tied into bundles, which are put up in small parcels, and so disposed, that the wind may penetrate through them, and the rain be as much thrown off from them as possible, and thus the plant may have the best chance of being securely and quickly dried.
This drying is watched with care and, when it is judged to be sufficiently advanced, the crop is transported to the barn, there to wait till the proper period of threshing it out arrives. All these processes are, it is evident, governed by rules drawn from assiduous and long continued observation, and their success depends on its extent and accuracy.
Were we to examine the manner in which all the articles that we provide for the supply of future wants are produced, we should find that they depend, in this way, on observations on the course of events, and on reasons rounded on these observations. Were proof wanting of this, we might turn at hazard to any complete treatise on any art. On examining it, we would invariably find it to contain a set of observations, the result of experience, and of reasons, and rules, drawn from these observations.
Since then man provides a supply for his future wants by his reason directing his industry, through means of his knowledge of the course of .events, to effect such changes in the form or arrangement of the parts of material objects, that these may produce articles fitted to afford this supply, it were desirable to have some common name to denote all the changes, which, for this purpose, he so makes. On this account I propose to give the denomination of instruments to all those changes that, for this purpose are made in the form or arrangement of the parts of material objects.
The term instrument is, in general, properly enough employed, to denote any means for the attainment of some end. In common use, however, and as applied to material things, it seems to be restricted to such arrangements of matter as owe their chief efficacy to what are called the mechanic powers. Thus a lever or a wedge is an instrument, the manner in which each of them operate being chiefly explained on mathematical principles. A spade, which is a combination of the two, is also an instrument. The tools which carpenters use are instruments. We speak in the same way of instruments of husbandry, meaning by the phrase the articles used in that art, whose properties may be explained on mechanical principles.
In all these cases, however, other principles than those which are merely mathematical must enter into our calculations. In the simplest-lever, we have not only the properties of a mathematical line to consider, but also, the weight and strength of the substance used, and these make the difficulty in the proper application of such an instrument. A wedge operates in many ways, besides those that may be considered to be derived simply from mathematical principles; as for instance in the percussion, which it receives and communicates, and through means of which, if skilfully applied, the most solid rocks may be rent. The farther we recede from such simple instruments, the more extensive do we find the action of properties, which could only be ascertained by a long series of observations. It would be impossible, for instance, to give any a priori rules for the construction of that most useful instrument the plough. It is, no doubt, a wedge, but the particular form giving the greatest efficacy to it, is a point of very difficult determination, not yet, perhaps, fully ascertained. It is accurate observation that has guided the construction of it, to its present efficiency, and which may be expected to render it still more perfect.
Were we to enter into an examination of more complicated machines or instruments, such as the steam engine, or the cotton mill, the observation would apply with double force, these generally deriving their efficiency from principles, that have been the result of very extensive and accurate investigations of many series of events. In thus using the term, therefore, we shall rather deviate somewhat from common usage, than be opposed to it, and in doing so, our reasons will only be subject to an inconvenience, to which all general reasons must be subject, and which quay be the more readily excused, as this use of the term may be defended from its derivation, its occasional acceptation, and the authority of authors of respectability.(33)
In general then, all those changes which man makes, in the form or arrangements of the parts of material objects, for the purpose of supplying his future wants, and which derive their power of doing this from his knowledge of the course of events, and the changes which his labor, guided by his reason, is hence enabled to make in the issue of these events, may be termed instruments.
In this sense a field is an instrument. The changes effected in the matters of which it is composed, for the purpose of rendering it an instrument, are the levelling and if necessary making the surface dry by means of ditches and drains, the removing stones from it, the mixing and pulverizing the soil by the plough, the harrow, and the roller, and the incorporating with it various matters termed manures, which render it more fit for the support of vegetable life. The future wants, towards the supply of which it is an instrument, are food and clothing. The power which has made it an instrument, is the agriculturist's labor, directed by his knowledge of the nature of plants and soils. The change made in the consequent issue of events, is the abundant growth of specieses of plants different from those originally produced by it, and conducing to the supply of food and clothing, or, more generally, the conversion of various vegetable matters of the soil, and gaseous matters in the air, into the substance of particular plants. The wheat grown on this field is an instrument. The changes effected in it, are its having been separated from the straw by the process of threshing, and its having been made sufficiently dry by keeping and exposure to air, to be fit to manufacture into flour. The want it tends to supply is nourishment, by affording bran for the support of some of the inferior animals, as hogs or cattle, afterwards to be slaughtered, and flour for the use of man. The power is also the art and industry of the agriculturist. The change in the issue of events consists in the grain being ready for the manufacture of flour, instead of having been left to rot on the ground, to be consumed by vermin, or destroyed by the access of damp or by the want of air. Flour also is an instrument. The changes that have been effected on it are its having been separated from the wheat, and reduced to a fine powdery matter. The want it tends to supply is food by the bread produced from it. The power, which has operated on it, is the art and industry of the miller. The change in the issue of events thereby produced is the existence of flour and bran, instead of wheat. Bread, until such time as it is in process of consumption, is an instrument. The change which it has undergone is that induced by the processes of kneading, fermenting, and baking. The want it supplies is food. The power which has operated on it is the art and industry of the baker. The change on the issue of events thereby produced is the existence of bread, instead of flour.
Though it may seem strange to rank all these in one class, that of instruments, nevertheless, the doing so is rather unusual than improper. They are all means toward the attainment of an end, and, for the attainment of this end, that is, the production of bread, do they alone exist. The blade as it springs from the soil, and the soil on which it grows, form together an instrument for this end, the plant when it has extracted all the nourishment from the soil which that can give, and is ripe on the ground, is an instrument; when it is cut and put up sheltered from the weather, it is still an instrument; so is the grain when separated from it; so it is when ground in the mill; so it is when in loaves, put apart for consumption, until the moment arrives when it is consumed. It is impossible, if we call it at first an instrument, to point out when it ceases to be so, until the moment when it is actually consuming.
All tools and machines are instruments. Thus a carpenter's saw is an instrument. The changes effected in the matters of which it is composed, for the purpose of rendering it an instrument, are, there having been given a fit form and temper to the steel plate of which it is made and a handle having been adjusted to it. The wants which it tends to supply are multifarious, according to the uses to which it is put. The power that renders it an instrument is the art and industry of him who makes, and of him who uses it. The changes effected in the issue of events by its fabrication and use, are the dividing into regular parts suited to different purposes, a great number of pieces of timber.
In a similar manner it might be shown, that houses, ships, cattle, gardens, household furniture, manufactories, manufactured goods, and stores of all sorts are in this sense, instruments. But it is, I apprehend, unnecessary further to multiply instances; every thing that man, for the purpose of gaining an end, brings to exist, or alters in its form, its position, or in the arrangement of its parts, is an instrument.
As man is thus enabled to provide for the wants of futurity, by his knowledge of the course of events, it naturally follows, that in any particular situation, his power to provide for them, is measured by the extent and accuracy of his knowledge. If that knowledge be diminished, his power will be diminished. Thus a deficiency of skill in the art of agriculture, or of baking, wilt alike occasion a diminution of the quantity of food to be got from a field applied to the cultivation of wheat. Neither can his power be increased, but by an increase of his knowledge. It is impossible to point out any improvement in any art, which does not depend on some new observations, or reasons, on the course of events connected with that art.
The generally admitted axiom, that knowledge is power, may not be strictly true. Many facts have been observed which have not yet been applied to any useful purpose, though it is probable they will, in time, be so applied. But, though it may not be strictly true, that all knowledge immediately gives power, it is so, that all power springs from knowledge, and is measured by its extent and accuracy. Neither can it be disputed, that it operates by enabling man's reasoning faculties, so to direct his industry, as to induce certain changes in the form and arrangement of the parts of material objects converting them into instruments. "Ad opera nil aliud petest homo, quam ut corpora naturalia admoveat et amoveat; reliqua natura intus transigit."
CHAPTER II.
OF THE CIRCUMSTANCES COMMON TO ALL INSTRUMENTS, AND OF THOSE
PROPER TO SOME.
All instruments agree in the following three particulars:
1. They are all either directly formed by human labor, or indirectly through the aid of other instruments themselves formed by human labor.
Sometimes, though rarely, instruments are constructed by labor alone. Thus occasionally rough stone fences are put up, by the hand alone, without the intervention of even a single tool. But, in most instances, the aid of other instruments is employed. It is seldom, that even the most common laborer is not assisted in his operations by some implement or another. But, whatever instrument or instruments may have cooperated with labor in the formation of any other instrument, they themselves have been either altogether, or in part, formed by labor; and, by retracing the course of things farther and farther back, we inevitably come to the conclusion, that labor was, in this sense, "the first price, the original purchase money that was paid for all things," and thus that, directly or indirectly, it is to be looked on as the agent that gives form to every instrument.
For the sake of simplifying the succeeding speculations, as much as may be, labor will be considered as the agent employed in the formation of all instruments. When the cooperation of other instruments is implied in the means by which any particular instrument is constructed, the degree in which they cooperate is understood to be measured by the quantity of labor for which their cooperation is, or might be, procured: and, in this sense, that cooperation is spoken of as an equivalent to labor. The rules, according to which the one thus measures the other, will he discussed subsequently.
2. All instruments bring to pass, or tend, or help, to bring to pass events supplying some of the wants of man, and are then exhausted.
Some instruments, without the intervention either of labor or of other instruments, produce events which directly supply our wants. Thus a peach tree yields its fruit to our hand. The operation of others only tends to the production of events supplying our wants. The growth of a crop of wheat is only a step towards the production of bread. Others require the help of either labor, or some other instrument. A row boat is useless without the labor of the man who plies the oar; a carriage, without the cooperation of the horses who draw it. All instruments, however, either produce, or contribute to the production, of events supplying some of our wants. Their power to produce such events, or the amount of them that they do produce, may be termed their capacity.
It is necessary to have some common measure for the purpose of comparing the capacity of instruments or the returns that are made by them, with the labor or its equivalents that went to form them. For this purpose, also, labor will be adopted, and the events brought to pass by any instrument will be estimated by the amount of labor to which they are esteemed equivalent by the owner of the instrument. As we proceed, it will appear, that this use of the term has no other effect than that of giving distinctness to our nomenclature. Besides, it often really happens, that the returns made by instruments, directly compare with labor, because they directly save labor. For instance, wooden or metal pipes are occasionally used to conduct water from a spring to some dwelling-house. Were they not there, the water would have to be carried within the dwelling by some of the domestics, and therefore the instrument formed by the pipes may be said indifferently, either to supply a certain amount of water, or save a certain portion of labor.
With one considerable exception, afterwards to be noted, all instruments at length bring to pass, or aid in bringing to pass, all the events which they can bring, or can help to bring to pass, I shall use the term exhaustion, to denote this passage of things from the class of instruments, into things which are not instruments. When an instrument is said to be exhausted, it is meant that the matters of which it was composed have passed out of the class of instruments into that of materials.
Sometimes they pass from the one class to the other suddenly. Thus, articles used for food and fuel, bring to pass all the events for which they were formed, very shortly. The appetite of hunger is gratified, and beat is communicated to the frame, in a few minutes, and the faggot and the bread, having yielded all the nourishment and heat stored up in them, then cease to be instruments. Gunpowder brings certain events to an issue instantaneously. The bullet is discharged, and the rock split, in an instant. This sudden and complete exhaustion of the capacity of instruments is what is usually termed consumption. Sometimes the matters of which instruments are formed pass from the class of instruments to that of materials by degrees. Thus tools and articles of wearing apparel are in use for a long time before they cease to be instruments. A saw may be in employment for years; a hat defends the head for months. When the capacity of instruments is thus gradually exhausted, it is usually said that they are worn out, and this sort 6f exhaustion is termed wear.
Sometimes the capacity of instruments is accidentally done away with, and they consequently pass out of the class of instruments, without being exhausted. Thus a house may be burned, cloth may be eaten by vermin. They are then said to be destroyed. A partial degree of this is damage. In calculating the capacity of instruments, it is necessary to reckon the risk they run of destruction or damage. In any estimation of the capacity, for instance, of a crop of wheat, we have to make as accurate an allowance as may be, for the risk of its destruction or damage, by the inclemency of the weather or other accidents, before the harvesting of it be accomplished.
3. Between the formation and exhaustion of instruments a space of time intervenes. This necessarily happens because all events take place in time. Sometimes that space extends to years, sometimes to months, occasionally to shorter periods, but it always exists.
The circumstances we have hitherto assumed as common to all instruments, and the events they generate, will, I believe, on examination, be found actually to be so. There is one circumstance, however, which it is necessary to assume as common to them all, and which in reality is not altogether so. In comparing the capacity of two or more instruments, which supply, or tend to supply, wants of the same sort, we may very often measure them by the relative physical effects, resulting from the action of the events brought to pass by them. Thus, if the consumption of one cord of fire wood, of a particular sort, is capable of producing exactly double the heat which the consumption of another cord of another sort produces, a cord of the former, will have double the capacity of a cord of the latter, and, if the one be equivalent to four, the other will be equivalent to exactly two days labor. In the same way, a log of timber from ]Norway, about to be employed in the construction of a house, if of equal size, strength, and durability, with another from Prussia, may, with justice be considered as of equal capacity to it; and so of many other instruments. We shall see afterwards, however, that this mode of determining the capacity of similar instruments, is in many cases incorrect, and that the instances are very numerous, where the relative capacities of instruments of the same sort, depend on other causes than their mere physical properties. The assumption, therefore, that they may be so determined, is to be considered as hypothetical, and to be tolerated from the difficulty of otherwise treating the subject; in the same manner as the hypothetic existence, of strictly n~mathematical lines, and the absence of friction and of the resistance of the air, is excused, in reasons concerning the mechanical properties of matter. As in these reasons, an attempt will be made to ascertain the extent, and mode of operation of those other causes; and, having traced what seem to be the great moving powers, and the laws governing them, we shall endeavor to discover the circumstances which retard or derange their motions.
It may be proper here to notice the acceptation, in which two other terms of frequent subsequent occurrence, are to be received. Some instruments are easily moved from place to place, and, on this account, there are peculiar facilities, in exchanging them with others. This seems to be the character distinguishing what are called goods, or commodities, from other instruments, and it is in this sense, that these terms will, in the subsequent pages, be employed.
CHAPTER III.
OF CERTAIN CIRCUMSTANCES ARISING FROM THE INSTITUTION OF SOCIETY,
1. Man hardly exists but in the social state. If separated from infancy from his fellows, his peculiar faculties scarcely at all develop themselves. His mental and bodily capacities and energies seem, also, to be moulded by the condition of the society of which he is a member. We may venture to predict, that three children born tomorrow, one in California, another in China, and a third in London, and remaining in their respective countries till the age of twenty, will be very different beings, and that each will possess the mental and bodily peculiarities, that characterize the particular community to which he belongs. The same things, though in a lesser degree, hold true concerning the men composing every nation. Whether these characteristics of different races, tribes, and peoples, proceed altogether from some peculiar hereditary conformation of the bodily organs, or from the effects of education, example, and habit, or from the combination of these, or from other causes, it is very certain that they exist, and that the moral and intellectual condition, as well as the bodily organization of men, vary, as they belong to this, or that society. Besides this, institutions, forms of government, and laws, influence somewhat the genius, and considerably affect the conduct, of every people, and these also are very various. It thus happens that every society has, what may be termed, a distinctive character of its own.
It is therefore assumed, in the succeeding investigations, that the moral and intellectual powers, the knowledge, the habits and dispositions of the men composing every separate community, society, nation, state, or people, terms which, as far as our subject is concerned, may be considered synonymous, are such as to give it a peculiar character distinguishing it from other communities. It is also assumed, that the average character of the members of different portions of the same community is similar, so that, were a considerable number of the inhabitants of any particular state, taken from one part of its territories, they would closely resemble an equal number, taken from any other part. This latter assumption is not exactly accurate. There are great differences, especially in extensive states, between the characters of the inhabitants of different portions of the same territory. These diversities render it sometimes necessary to modify the conclusions that follow from considering the average character of the members of the same community as perfectly similar. Thus, the different characters of the inhabitants of England, Ireland, and Scotland, affect somewhat deductions in this subject, drawn from treating the characters of the population of different parts of Britain as uniform. In truth, every large society might be divided into several smaller societies, differing somewhat from each other. If they differ in some particulars, however, they agree in many more, and certain results follow from this agreement, which make it convenient to treat of them as one. If necessary too, the amount of the inaccuracy, arising from the assumption of a more perfect uniformity than exists, may be ascertained.
2. Man, as an organic being, is governed by laws similar to those which other organic beings obey. Our subject obliges us to advert to a consequence arising from one of them.
In the midst of the numerous revolutions and accidents to which the surface of the globe is subject, it is always abundantly replenished with animal and vegetable life, and the numbers of every race upon it are kept up to the quantity of materials fit for their subsistance which it affords them. The increase and decrease of the human species, follows the general law. This seems to be the foundation of what has been termed the doctrine of population. In the subsequent pages it is received, simply as a statement of the fact, that the numbers of every society increase, as what its members are inclined to esteem a sufficient subsistence, is provided for them.
The great majority of the members of every community, procure their subsistence by labor, and, according to this principle, the number of laborers in every community must finally depend on the amount of those things esteemed by them sufficient for their subsistence, which is atomally distributed among them. It has been supposed, however, that there is a constant oscillation above and below this limit, and that sometimes therefore the supply having to be divided among a greater number, the amount that each receives is less, sometimes, having to be divided among a smaller number, is greater, and thus that the wages of labor, though they always tend towards a fixed standard, never remain at it. Admitting that this continual vibration may take place, I conceive I may be permitted nevertheless to disregard it, and to assume that the remuneration awarded the laborer, is, in the same society, always a fixed quantity. As it is not intended to enter into any investigation of the principles determining the amount of the wages of labor in all societies, and at all times, nor to discuss the somewhat contradictory doctrines that have been maintained on this subject, the most simple assumption, and that, the errors arising from which may be supposed to balance each other, seems the best.
Even considering the subject however under the most simple conditions possible, there are still some difficulties attending it. The articles which the laborer uses, for food, clothing, etc., and which constitute his real wages, are continually varying. Thus, among the working classes in Great Britain, fabrics of cotton have, in a great measure, taken the place of those of linen, and wool for clothing; as coal has taken the place of wood for fuel. Seeing there is this change in what constitute the wages of labor, how then, it may be demanded, can wages at any two times be considered equal?
In answer to such a question, it may be observed in general that all articles supplying the wants of the laborer, and forming his real wages, are fitted for this purpose by some physical qualities they possess, producing certain effects on his bodily organs, and, through them, occasionally, on the perceptions and thoughts of his mind. One article, therefore, may be esteemed equal to another and different article, if the effects produced by both are equal. Thus a certain quantity of coal, may be considered equal to another of wood, if each gives out the same degree of heat. In many cases it is indeed very difficult to make this comparison with accuracy. This however is not absolutely necessary for our purpose, it being sufficient to conceive, that, what are termed the wages of labor, in the same society, at different periods, are really equal quantities, whether we have, or have not, the means of measuring them, and ascertaining that they actually are so. This may evidently be assumed, if we suppose that the laborer is equally well nourished, clothed, lodged, and instructed, and has equal leisure, at the one period and at the other; whether he be fed, clothed, and lodged, in the same way or not.
As the vigor of mind and body, as well as the skill, of different individuals in the same society, are unequal, the rate of the wages of labor, even in the same society, is far from uniform. It is however difficult and in general reasons unnecessary, continually to refer to this variety; and as it has, in consequence, been usually neglected, we shall not farther advert to it.
According to the preceding assumptions, labor, in the same society, is to be considered as an invariable quantity, and a day's labor as the unit, serving as the base for calculations, concerning the formation and exhaustion of the capacity of instruments. It is to be observed, however, that when so employed, it finally refers, not to the mental and corporeal effort exerted throughout the day by the laborer, but to the wages received by him. The laborer is, usually, merely the agent of some other person, and that other person is, in reality, the one forming the instrument constructed, as the wages of the laborers employed by him are the causes of its being constructed. In cases too, where the laborer works for himself, he rates his daily labor equal to a certain amount of some of the things he is in the habit of consuming, and this amount may be considered, as what he really gives to the construction of the instrument, in the formation of which he employs himself.
The rates of wages vary, very much, in different societies. A Chinese laborer, for example, subsists on very much less than an English laborer. On the principles of calculation which we have adopted, there is, therefore, a difference, in the quantity embraced by a day's labor in one country and in another, and we cannot immediately compare, by this means, instruments formed in one society, with those fondled in another. Our system has, in this respect, an analogy to the different systems of numeration, with regard to weights, measures, and coins, adopted in different countries. It will, as we proceed, appear, that this diversity in the rate of wages, in different communities, has also other and more important effects.
3. Every society possesses a certain amount of materials capable of being converted into instruments. The surface of its territory, the various minerals lying below the surface, its natural forests, its waters, the command it may have of the ocean, and its consequent property in the minerals and animals contained in it, the rain that waters its soil, the elementary principles that may be extracted from the atmosphere, even, perhaps, the light and heat of the sun, are all to be regarded as materials, which, through the agency of the labor of its members, may be converted into instruments. The extent of the power, which the inhabitants of any state may possess, to convert into instruments the materials of which they have the command is however variable; and increases, as we have seen, as their knowledge of the properties, of these materials and of the events, which in consequence of them, they are capable of bringing to pass, increases. Thus the large extent of the knowledge of the .civilized man, compared with that of the savage or barbarian, gives him the power of constructing a much greater number of instruments out of the same materials, and enables the European emigrant to convert the soil and forests or America or New Holland, into means of producing a great mass of desirable events, which it was beyond the capacity of the ignorant native to effect.
CHAPTER IV.
EVERY INSTRUMENT MAY BE ARRANGED IN SOME PART OF A SERIES, OF WHICH THE ORDERS ARE DETERMINED, BY THE PROPORTIONS EXISTING BETWEEN THE LABOR EXPENDED IN THE FORMATION OF INSTRUMENTS, THE CAPACITY GIVEN TO THEM, AND THE TIME ELAPSING FROM THE PERI6D OF FORMATION TO THAT OF EXHAUSTION.
As by the capacity of instruments is to be understood their power to produce, or bring to an issue, events equivalent to a certain amount of labor, and as they are also formed by labor, it is evident that the capacity given to any of them, and the labor expended in its formation, have determinable numerical relations to each other. The length of time likewise, elapsing between their formation and exhaustion, may be expressed in numbers. If a series then were devised, of such a nature, that any relation that can exist among these three quantities, in consequence of their varying proportions to each other, might be embraced in it, every possible instrument would find a place there.
It is to be observed that, in consequence of a principle soon to be explained, no instruments will be designedly formed, but such as have a greater capacity, or issue in events, equivalent to more than the labor expended in their construction. This circumstance renders the formation of such a series more easy, as it renders it unnecessary to take account, of any other instruments than such as issue in events equivalent to mere than the labor expended in their formation, or, what may be termed, the cost of their formation. To simplify the consideration of the matter, we may, for a little, proceed on the supposition, that every instrument is constructed at one precise point of time, and exhausted at another. In that case, every instrument would find a place, in some part of a series, of which the orders were determined by the period of time at which instruments placed in them, issue, or would issue, if not before exhausted, in events equivalent to double the labor expended in forming them. These orders may he represented by the letters A, B, C, * * Z a, b, c, etc. The relation to each other of the cost of formation, the capacity, and the time elapsing between the period of formation and tltat of exhaustion, of instruments in the order A, is such as may be expressed by saying, they in one year issue in events equivalent to double the labor expended on their formation, or would so issue, if not before exhausted. The relation between these, in instruments of the order B, is such, that in two years they issue in events equivalent to double the labor expended on them, and are then exhausted. Instruments in the order C, in three years issue in events equivalent to double the cost of fortnation; of the order D, in four years; of the order Z, in twenty-six years; of the order a, in twentyseven years, etc. For the sake of t:acility of expression, instruments in the order A, or in the orders near it, will be said to belong to the more quickly returning orders; instruments in the order Z, or in the orders near it, or beyond it, will be said to belong to the more slowly returning orders.
To imagine, in the first place, as simple a case as possible. An individual, say an Indian trader, is obliged to reside on a particular spot in the interior of North America, for somewhat more than a year. He arrives in autumn, and immediately sets about inclosing and digging up a piece of ground, for the purpose of having it planted with maize. He expends on this twenty days' labor. That labor he reckons equivalent to ten bushels of maize. He gets the maize planted, hoed and harvested next season, by Indian women, agreeing to give them part of the crop. After deducting their portion he has twenty bushels for himself, with which he leaves the place. The field he formed was then an instrument of the order A. The same individual has to reside a little more than two years in another quarter of the interior. He clears, or has cleared on his arrival, another piece of ground, and also expends on this operation twenty days' labor. Owing however to the soil being overrun with small roots, and it being necessary to wait till they partially rot before a crop can be put on it, he is aware that it cannot be planted until the second year. It is then planted as before, and, as it happens, with the same event as in the former field, yielding him net twenty bushels maize. This field then was an instrument of the order B. In the same way it is possible to conceive the formation and exhaustion of other instruments of this sort, answering to the orders C, D, E, etc. the capacity of them all being double the cost of formation, and the times intervening between the periods of formation and exhaustion, being respectively three, four, five, etc. years. Although, however, instruments exactly corresponding to the conditions assumed, may occasionally exist, and although it is possible at least to conceive their existence throughout a lengthened series, yet, in fact, they seldom do exist so as exactly to answer the suppositions. In by far the greater number of instances, neither the times, elapsing between the periods of formation and exhaustion, are any exact number of years, nor are the capacities double the cost of formation. But, in all variations of these three quantities from an exact correspondence with any of the orders, the proportions existing between them, will, nevertheless, always be such, as to make it possible to reduce the instruments in which they occur, to some order or another in our series, or to an order that may be interposed between two proximate orders.
Such variations may be reduced to three sorts. The first consists of instances where the capacity is double the cost of production, but the time, no exact number of years. In this case, the instrument does not exactly belong to any of the enumerated orders, but falls between two proximate orders; it may therefore be said to belong to an order, that may be supposed to be interposed between these two. Thus, an instrument being exhausted in between seven and eight years, and having a capacity equal to double the cost of production, might be said to belong to an order lying between G and H. This designation would mark its character with sufficient accuracy for our purpose.
There are only two other cases. The capacity of the instrument may be exhausted before it arrive at an amount equal to double the cost of formation, or, it may not be exhausted until it has come to an amount greater than double the cost of formation. In the former ease it is necessary to suppose the period of exhaustion prolonged, the excess of the capacity of the instrument over the cost of formation increasing at the same ratio, until the capacity double the cost. It will then be shown to belong to some particular order, or to lie between two proximate orders. Thus; let an individual have it in his power to make use of a small plot of ground for six months, and let him expend an equivalent to two days' labor in preparing it for receiving the seeds of some plant, sowing them, and cultivating the crop, and let it return him, at the end of six months, an amount, which, reduced to the value of days labor, would be 2,828. If then we suppose the period of exhaustion prolonged, the excess of the capacity over the cost increasing at the same ratio, in twelve months time the capacity will be 4; for, 2,828 is a mean proportional between 2 and 4. The instrument formed by the plants so cultivated, would therefore belong to the order A, that order doubling in one year.
In the case where the capacity comes to more than double the cost of formation, the order in which the instrument should be placed, is to be found, by retracing the progress of its capacity, under the supposition that it advanced at the same rate, until we arrive at a period when it was only double the cost. The interval between that and the period of formation, will then indicate the order to which it really belongs.
The bread fruit tree is perhaps twenty years before it bear; but ten of these trees, when in bearing, will, it is said, nearly supply a family of South Sea islanders, with a sufficiency of this sort of food for eight months in the year. This sort of fruit tree requires, too, no other labor or attention than that bestowed in planting it. Suppose, then, that an inhabitant of one of those islands were to spend an hour in planting a few of these trees, and that, according to the hypothesis of sudden exhaustion, on which we are proceeding, at the termination of the twenty-two years they are exhausted, yielding at that period an equivalent to two thousand and forty-eight hours labor. If then we retrace the progress, at which the capacity of this instrument has advanced, we will find that it belongs to the order B. For, instruments in that order doubling in two years, one hour's labor, if employed in forming an instrument of that order, ought to yield an equivalent to two hours, at the end of the second year; and being then employed in constructing other instruments, at the end of the fourth year should yield an equivalent to four hours, at the end of the sixth to eight, and so the geometrical series, 2, 4, 8, 16, etc. would arise, which, carried out to the eleventh term, at the end of the twenty-second year, is 2048. It may perhaps serve somewhat to illustrate the matter, to suppose, that the individual who applied an hour's labor to planting the bread fruit tree, gave the same portion of time to the cultivation of another sort of plant, yielding its produce, and perishing, at the termination of the second year from the time of its being placed in the soil, and the returns made, from which are equal to double the labor expended on its culture. Instead of consuming the crop at the termination of the second year, he gives it to some other person or persons, on condition of their applying for his benefit two hours' labor, its equivalent, to the culture of a second crop; at the end of the fourth year, he proceeds in the same manner, and, continning the process, at the termination of the twenty-second year, the produce of the labor, of both hours', the one applied to the cultivation of the former plant, and the other, to that of the latter, would be equal. The only difference in the cases would be, that, the person in question, would, in the latter case, have the trouble of making a bargain with one or more individuals every second year, and would then also have the power to apply, if he so chose, to the supply of his wants, the events, in this instance brought about by his previous expenditure; and that, in the latter case, he would have neither the power nor the trouble.
We have assumed, that all instrmnents are formed at one point of time, and exhausted at another. This is the case with but very few. The period of formation almost always spreads over a large space of time, and that of exhaustion, over another. It is evidently, however, possible to fix on a point, to be determined by a consideration of all the periods at which the labor going to the fortnation was expended, which shall represent the true period of formation; and on another point, determined from a consideration of similar ch'cnmstances regarding the times when the capacity was exhausted, which shall represent the true period of exhaustion.
Thus, suppose a small field in some new settlement in North America, were formed by twelve days labor, it would, were it of the order A, return in one year an equivalent to twenty-four days labor, and then be completely exhausted and worthless. It might, however, be, that it belonged to this order, although it neither yielded so much as twenty-four days labor, nor was exhausted at the end of the year. Say,.that the crop sown is wheat, and, that one bushel wheat is equivalent to one day's labor. Were it at once exhausted, it ought to yield twenty four bushels wheat; it however only yields eighteen, and is not then exhausted. There is consequently a deficiency of six bushels. Now, six bushels at the end of the second year, at the same rate of doubling in a year, ought to produce twelve. Let us suppose that the next crop is hay, and that the net hay yielded the second year is one ton, equal to eight bushels wheat, then 12 - 8 = 4, there is still a deficiency of four bushels, equivalent, at the end of the third year, to eight. If, therefore, the next crop of hay the third year, be equal to what it was the second, that is to eight bushels wheab the deficiency will then be made up. Let us suppose that it is so, and that the field is at that time totally exhausted and useless. It is evident, that such a field, though not producing, or being exhausted as by the supposition, yet producing and being exhausted, in a manner equivalent to the supposition, might, with propriety, be said to belong to the order A.
But, it is farther probable, that such a field, might not produce quite so much grain, or hay, as we have even by the last hypothesis supposed, and would not even at the end of the third year, or for a much longer period, be exhausted; still, if the deficiency in the one, were equivalent to the farther supply in the other, it would evidendy properly belong also to the same order.
Again, by the suppositions we have made, the labor, or its equivalent, was expended exactly at the commencement of the period done year. It might however have been, that some part of the expenditure, going to the formation of this instrument, was made several months before the commencement of the year, and some several months after. But, had what was expended before, been proportionably less, and what was expended after, proportionably greater, the change would not make any alteration to the relation existing between the time and the expenditure, or, consequently, to the place of the instrument.
The spaces over which the several points of time, at which the formation of any instrument is effected, extend, and those over which the several points of time at which its capacity is exhausted also extend, frequently run into each other. Thus according to our system a riding-horse is an instrument. The space of time over which the whole period of his formation extends, commences when his dam is put apart for breeding, continues as long as any thing is laid out for the purpose of giving efficiency and durability to him as an instrument, and probably therefore only terminates a few days before the death of the animal. There would be a number of points all along that space, at each of which something had been expended on his account, and from the date of which, and the amount expended at each, data would be furnished, to ascertain the whole expense of his formation, and the precise point from whence it might be dated. The whole period of his exhaustion would also extend over a large space. It would commence when he was first ridden for pleasure, or business, and would terminate shortly after his death, when his hide went to the tanner, and his flesh to the dogs. An account .pf the several items expended, and the times when they were expended, and of the several items yielded, and the times at which they were yielded, would furnish data for determining the total cost of formation and capacity and the points to be fixed on as the periods of formation and exhaustion, and thus the place of the instrument could be determined.
Calculations of this sort would be intricate, and could not be well effected without having recourse to methods, not usually employed in investigations like the present. In point of fact, there is in practice, as we will afterwards see, a system of notation of instruments, which enables us pretty accurately, and very easily to determine their place in such a series as we have supposed. It is sufficient for the end here aimed at, to perceive that when all particulars are known, concerning the formation and exhaustion of any instrument, and the periods intervening between these, data are then furnished for placing it in some part of such a series as we have described; and that it may consequently be assumed that every instrument does, in reality, belong to some one order in the series A, B, C, D, etc., or to an order that may be interposed between some two proximate orders of that series.
It may perhaps appear, that though, could instruments be considered apart, the foregoing explications might serve to show, that they might all be reduced to a place in our series, yet, as they very commonly act in combination, and as, in such instances, the events in which two or more of them issue are the same, it must be impossible to fix with accuracy the order to which each belongs. Thus, a horse and a cart form together an instrument for the transport of goods. The events, therefore, in which both issue, being the same, we cannot measure the part that may belong to each, in any other manner, than by appropriating to each the proportion indicated by their respective costs of formation, and hence they will both appear to belong to the same order, though perhaps they do in fact belong to different orders. But our subsequent inquiries will show, that the great mass of the instruments existing in the same society are, in reality, at about the same orders; and, that instruments acting in combination with other instruments, are almost always at the same orders. This objection is therefore removed, as all instruments acting in combination may thus be considered as one.
Instruments are frequently repaired. The labor or its equivalent, so expended, may be considered, either as a partial reformation of the old instrument, or as the addition of a new instrument to be combined in action with the old one. The same rules therefore, apply to repairs effected on instruments, as to their original formation.
We have assumed, hitherto, that both formation and exhaustion are properties common to all instruments. There is however a class of instruments, that forms an exception to this general rule. An extensive and important class exists, of a nature so peculiar, that the instruments belonging to it are never exhausted, unless in consequence of some revolution in the circumstances of the society. That part of the surface of the earth devoted to agricultural purposes composes this class. The peculiarity arises from every portion of land so employed, forming two distinct instruments. A piece of land, that it may do its part in providing a supply for future wants, must first be rendered capable of culture, and then be cultivated. It is not necessary that he who renders it fit for culture, should also cultivate it, though it commonly happens that both operations are performed by the same individual. But by whomsoever the operation of converting waste land, into land bearing crops, be performed, two ends are always gained by it, the power of cultivation, and the actual culture. There is this great difference between them, that while the changes produced in a piece of land to fit it for cultivation are lasting, remaining unless some means be taken to do away with them; those that are effected on it by the actual process of cultivation are of short, or at all events, of limited duration. When an individual has converted a portion of morass or forest, into a field fit for the operations of tillage, it does not return again to the state of morass or forest. He has fitted it for being made an instrument of agriculture, or rather a succession of instruments of agriculture. The farmer, by manuring it, sowing certain seeds in it, and tilling it, forms it into such an instrument. The changes he thus effects however pass away. The seeds he sows, growing into plants of different kinds, are carried off; the manure yields part of its substance to them, and is in part dissipated; the soil that had been loosened and pulverized by the plough and harrow, is gradually again compacted and hardened, by the effects of the action of the sun and rain. As far then as it was actually an instrument of agriculture it is exhausted. But its power of being again formed into such an instrument remains, and the same operations, the same rotation of crops, may indefinitely succeed one another.
The individual who first forms a portion of land into these combined instruments, has probably in view, only the ends to be gained by one of them. His motive to expend labor on the formation of the field, is to fit it for immediate culture. But, he cannot effect this, without also rendering it capable of being cultivated to all succeeding times. The returns, which for this reason it makes in those succeeding times, form what is called rent; and this peculiarity in the nature of this sort of double instrument, is one of the chief causes of the existence of that particular species of revenue. Any portion of land therefore, which bears a crop, considered as regards its fitness for being cultivated, is an instrument of indefinite exhaustign, and will not consequently coincide with the conditions by which the orders in our series are determined. We shall afterwards see, that in every instance it may, notwithstanding, be reduced to a determined place in that series. A portion of cultivated land, considered as an instrument actually subject to the operations of the husbandman, does not differ from any other instrument.
In conclusion, it may be observed that the position in our series which any instrument will occupy, is determined by the following circumstances.
1. The shorter the space of time between the period of its formation, and that of its exhaustion, the nearer will any instrument be placed to the order A, that is, towards the more quickly returning orders.
2. The greater the capacity, and the less the cost of its formation, the nearer will any instrument be to the order A; the less the capacity, the greater the cost of formation, the farther will it be from A.
Generally, the proximity of instruments to A is inversely as the cost and the time, and directly as the capacity.
CHAPTER V.
CIRCUMSTANCES DETERMINING THE AMOUNT OF INSTRUMENTS FORMED.
Having traced the general nature of instruments, and shown, that the relations existing among the circumstances by which they are affected, make it practicable to arrange them in a regular series, the object next claiming our attention, is, to ascertain the causes determining the amount of them which each society possesses, and to mark the more remarkable phenomena which the operation of those causes produces.
The causes determining the amount of instruments, formed by any society, will, I believe, be found to be four.
1. The quantity and quality of the materials owned by it.
2. The strength of the effective desire of accumulation.
3. The rate of wages.
4. The progress of the inventive faculty.
The nature of the second of these, and the circumstances on which its strength depends, will form the subject of the next chapter, but previously to entering on it, it is necessary to establish the following proposition.
The capacity which any people can communicate to the materials they possess, by forming them into instruments, cannot be indefinitely increased, while their knowledge of their powers and qualities remains stationary, without moving the instruments formed continually onwards in the series A B C etc., but, there is no assignable limit to the extent of the capacity, which a people having attained considerable knowledge of the qualities and powers of the materials they possess, can communicate to them, without carrying them out of the series A B C etc., even if that knowledge remain stationary.
The capacity of instruments may be increased, by adding to their durability, or to their efficiency; that is, by prolonging the time during which they bring to pass the events, for the purpose of effecting which, they are formed, or, by increasing the amount of them which they bring to pass within the same time.
A dwelling-house is an instrument, aiding to bring to an issue events of various classes. It more or less completely prevents rain, damp, and the extremes of cold and heat, from penetrating to the space included within its area. It preserves all other instruments contained within it, in comparative safety. It gives those who inhabit it the power of carrying on unmolested, various domestic occupations, and of enjoying, undisturbed by the gaze of strangers, any of the gratifications or amusements of life, of which they may be able and desirous to partake. Events of these sorts, it may bring to pass, for a longer or shorter time, or to a greater or less extent, within the same time. In the former ease, the durability is increased, in the latter, the efficiency; in both, the capacity is augmented. Dwelling-houses are built of different .materials, and those materials are wrought up with more or less care. A dwelling might be slightly run up of wood, lath, mud, plaster, and paper, which would only be habitable for a few months or years, like the unsubstantial villages, that Catherine of Russia saw in her progress through some parts of her dominions. Another of the same size, accommodation, and appearance, that might last for two or three centuries, might be constructed, by employing stone, iron, and the most durable woods, and joining and compacting them together, with great nicety and accuracy. Between these two extremes there are all imaginable varieties. According to that adopted, both the durability and the efficiency will be greater or less. These two may be separated from each other, at least in imagination, and therefore we may consider them apart.
If the increased durability that may be given an instrument be considered apart from the increased efficiency that will also probably be communicated to it, it must be regarded simply as an extension of its existence, and consequently as a like extension of its capacity. A dwelling-house lasts, we shall say, sixty years, but in other respects is perfectly similar to one lasting only thirty years. Considered as an instrument, the former is, therefore, exactly equal to two of the latter, the one formed thirty years after the other. A house lasting one hundred and twenty years would in like manner have the capacity of four houses, one formed now, a second thirty, a third sixty, and a fourth ninety years hence. The capacity thus increasing at the same rate as the duration, if the limits to the power of giving durability be indefinite, the limits to the power of communicating capacity are also indefinite.
But to give additional durability to the instrument there must be additional labor bestowed on its formation. An increase of the durability of an instrument may therefore be considered as a power communicated to it of giving existence to a new instrument at the end of a certain period, and purchased by a present expenditure. The effects produced by the change will be determined by the relations subsisting between the returns made by the addition, its cost, and the time elapsing between the expenditure and return. If we suppose the present expenditure necessary to produce the durability, to be always equal to the durability produced, then the compound instrument will be moved towards the more slowly returning orders, because the new instrument is in that ease one of slower return. One dwelling-house lasts thirty years; another, the same as it in other respects, but costing double the expense of formation, lasts sixty years; the former house is an instrument of the order O, doubling in fifteen years. The part of the duration of the latter extending from the thirtieth to the sixtieth year, is to be considered, by our hypothesis, as a separate instrument. If we suppose, that during the time it is in use it returns as the other, at the end of the sixtieth year it will have returned only four, and, therefore, is an instrument of the order C doubling only in thirty years. The compound instrument will, in consequence, be of an order between X and Y, doubling in between twenty-four and twenty-five years. The procedure of adding to the durability, by adding equally to the expense of formation, will have greater effect in placing an instrument further from A, the more it is subjected to its operation. Thus, were an instrument of this sort to have its duration prolonged to one hundred and twenty years, and at the same expense, the last thirty would return only four in one hundred and twenty years, whereas, had it formed an instrument of the order O, it ought to have yielded two hundred and fifty-six. Were the durability increased still farther, at the same cost, the divergence would be much greater, going on in a geometrical ratio. If, therefore, continual additions be made to the durability of an instrument, it cannot be preserved at an order of equally quick return, unless the several augmentations be communicated to it, by an expenditure diminishing in a geometrical ratio; that is, in a ratio becoming indefinitely less, as it is continued. This, however, cannot happen, for, it would imply an absurdity. While instruments are in existence, they are either producing events, or giving a new direction to their course. But, mere matter, unless in some very rare instances, is never acting, or acted upon, without undergoing a change. This we term wear, and the effects it indicates form consequently a definite power, to counteract which, a definite force must be found. It cannot then, be counteracted, by a force indefinitely small.
The same thing may be illustrated in another manner. When events are produced and governed by design, they in turn generate other events of greater powers than themselves, and these others, in a series rapidly increasing. Mere durability in instruments, may be considered as a capacity to generate future events, lying dormant in them, till the lapse of years exposes its existence, and gives it opportunity to act. The greater the time therefore, for the expiration of which it must wait, the less the chance of its being on an equality with rivals, whose powers are continually and rapidly multiplying either events, or enjoyments, whenever they have a field on which to exert their energies.
While the knowledge of the course of events which the members of any society possess remains unaltered, and the materials they own are the same, the duration of the instruments they form cannot, consequently, be indefinitely increased, without their being moved, farther and farther, from the more quickly returning orders.
The durability of instruments refers only to those of gradual exhaustion; their efficiency, or the extent of their power to bring about events within a certain time, refers both to those of gradual, and of sudden exhaustion. If the knowledge of the course of events, and the amount of the materials remain the same, the efficiency of these materials when formed into instruments cannot be indefinitely increased, without that increase being at length made with additional difficulty, and through means of an amount of labor greater than was required in the earlier stages. The action of matter upon matter always depends on some cause. Those causes, -- the inherent qualities and powers of the different matters around him, -- are the means man employs to make one material to act so on another as to produce the events he desires, and he does so by applying his labor to give them such a form and position as may bring their powers into play. If we suppose any number of men to be fixed to one situation, and their knowledge of the qualifies of the materials around them to remain stationary, they will naturally first make choice of those materials, whose powers are most easily brought into action, and which produce the desired events most abundantly and speedily. But as the stock of materials which any society possesses, is limited, its members, if we suppose them to acquire no additional knowledge of the powers of those materials, and yet to add continually to the amount of instruments they form out of them, must at length have recourse to such as are either operated on with greater difficulty, or bring about desired events more sparingly or tardily. The efficiency of the instruments produced must therefore be generated by greater cost; that is, they must pass to orders of slower return.
This passage will be rapid, or slow, as the amount of knowledge possessed is small, or great. When art is in its infancy, and men know but a few of the properties fitting them for becoming instruments, that are inherent in the materials in their possession, they cannot much vary their mode of proceeding on them, by combining, and giving new turns to their actions on each other. In more advanced stages of society, on the contrary, where the powers of a great number of materials are known, arm where consequently their operations on each other, may be combined, and multiplied to a great extent, the means by which the same end may be attained are very numerous. Some of them are more easy or expeditious than others, but they differ by very slight degrees, and the instruments formed by successively adopting them, would occupy positions in one series not widely distant from one another.
If we then consider the capacity that may be given any amount of materials, by a society among whom the progress of art is stationary, as separated into the durability, and efficiency, of the instruments its members form, it would appear, that they are both subject to similar laws, and that neither can be indefinitely increased, without carrying the instruments constructed continually on, to orders of slower return. The same general conclusions must obviously hold good. concerning the capacity considered as combined of both. There is, however, a circumstance flowing from the consideration of this union, which is deserving of notice, as it has considerable effect in the relations between the cost and capacity of instruments, and, consequently, on the position to be assigned them. It often happens, that additional labor bestowed on an instrument, to give it greater efficiency, gives it also greater durability. Thus the same choice of materials, and the same careful and laborious formation of them, that render the walls of a dwelling-house effective in excluding the inclemency of the weather, give it also solidity and strength, and consequently prolong its duration. A tool, in the fabrication of which good steel has been employed, not only cuts better, but lasts longer, than one formed of inferior stuff. In such cases, and they are very numerous, the capacity being increased, both as concerns durability and efficiency, by the same outlay, its proportion to the cost is greater and a larger expenditure may be made on the formation of the instrument without moving it at all or moving it but a short distance towards the orders of slower return. Sometimes the same expenditure that gives efficiency to instruments, partly also increases their durability and partly, quickens their exhaustion. Thus, the majority of roads in North America, and in many other countries, are constructed altogether of the soil of which the surface happens to consist, arranged in a form adapted to the purpose. Such roads, unless in the best of weather, are very inefficient instruments in facilitating transport, and their durability is so small, that they are probably reconstructed, by repair, every four or five years. A road formed of small fragments of stone, in the manner that is termed macadtxraization, costs perhaps twenty times as much, but is both a far more efficient, and a far more durable instrument. Besides however being more durable, and efficient, the facility it gives to transport occasions an increase of transport, and its exhaustion is thus quickened. For example, the capacity of a road of this sort, may be adequate to the transport of two hundred thousand carriages; if this be spread over twenty years, it will be an instrument of much slower return, than if, in consequence of the annual transport being doubled, that number pass over it in ten years.
As efficiency and durability are frequently produced by the same means, so, it sometimes happens, that the means which would add to the one, cannot be employed, without diminishing the other. Thus there are many tools and utensils, that cannot be made very strong, and therefore durable, without being at the same time clumsy, and inefficient; and they cannot be made very light, and easy to work with, without being also of little durability. The difficulty in the combination of the qualities of durability and efficiency, in the same materials, can only, however be considered as absolutely limiting the capacity of those instruments, to support the weight of which, a corporeal exertion is required; and is consequently confined to wearing apparel, and to those tools, and utensils, which are altogether moved by the hand. When the weight rests on some firm basis, it can be poised, and by the application of sufficient expenditure friction, can be removed. The circumstance of the qualities of durability, and efficiency, depending on the same materials, has therefore, probably, on the whole, the effect of retarding somewhat, though not very greatly, the progress of instruments as greater capacity is given to them, towards the more slowly returning orders.
The various powers of the material world, seem to be connected at some common centre, and its several parts to exercise reciprocal influences on each other. Hence, a discovery of new properties in any one material, or more easy modes of bringing the old into play, generally extends the power of man over a great range of the other materials, which he had been in the habit of before applying to his purposes. When art, therefore, has made considerable progress, and comprehends within its dominion a multiplicity of materials, the variety of effects that may be generated, from the action, and reaction, on each other, of the numerous powers at its disposal, becomes illimitable. As in numbers, every addition multiplies amazingly the possible antecedent combinations, until at length the amount becomes too great to be ascertained. Hence it is, that, though among barbarous nations, the ability of man to increase the amount of instruments he possesses may be bounded, among nations having made considerable advance in art, there seems no assigning any limit to it, other than that indicated in the second part of the proposition, the necessary gradual passage of the instruments constructed, to orders of slower and slower return.
It is hence, that, if we turn to any community where art has advanced, we invariably see, that however much industry may have already exerted itself, on the materials within its reach, the field for its possible future action seems rather increased than diminished, and that the farther we stretch our view over it, to the greater distance its extreme circumference recedes from us. The industry of the people of Great Britain, has probably been as largely applied to the materials which its limited territory possesses, as that of any other community presently existing; yet certainly, there is no lack of matters on which it might be farther exercised. A large portion of its surface, and which wants not, nevertheless, all the requisites for the sustenance of vegetable life, lies yet uncultivated. With the exception of the mountainous and rocky regions, heat, light, air and water, in sufficient abundance rest on every part of it, nor is the presence of many of the earths, the mixture of which forms a proper shelter for the tender radicle fibres, and a commodious storehouse for an important part of their nourishment, .any where wanting. There is also in general a considerable supply diffused over the surface, of the decomposing remains of former vegetables, and animals, the material which constitutes nearly the whole solid food, that the organic life of plants requires; and, even when this is deficient at one point, there are larger collections of it at some other. The outlay requisite, in many instances, to give such form to these materials, as to fit them for the purposes of the agriculturist, would, no doubt, be very great, still, whatever it might be, as the instrument formed would be of unlimited duration, the annual returns from it, would, in time, exceed the cost of formation, and bring it within the limits of our series.
Were we to go over the various other instruments, the returns from which supply the wants of this community, we should perceive, that every where, their capacities are capable of being greatly increased. One would not find it very easy to say, how much might be added, to the durability and efficiency, of dwelling-houses alone. The amount of the capacity for the facilitation of future transport, which might be embodied in railroads, returning ultimately much more than the cost of their formation, is incalculable; as is also, the degree to which mining operations might be extended. Even supposing all these, and many other instruments, to have acquired a vastly increased extent, both as concerns durability and efficiency; instead of limiting their further increase, it would seem likely, rather to open up a still wider space, for the exertion of future industry in the formation of others. Were the soil universally cultivated, were railroads extended and ramified throughout the country, and were the riches of the mineral kingdom more fully brought out, the additional facility given to the formation of instruments, by the command afforded of the materials necessary for their construction, and the ease with which they might be transported from point to point, would, it may well be supposed, be sufficient, to give the means of a still greater increased construction of them, and a still farther advance, of the amount of the capacities for the supply of futurity, embodied in the various instruments, spread over the surface of the territory, or lying above, or beneath it. In short, the more we consider the subject, the more clearly shall we perceive the impossibility of fixing any limit to the amount of the labor which may be expended in the formation of instruments, in this, or any other community, where art has made considerable advance.
This progress, while art itself remained stationary, would, however, undoubtedly, gradually carry instruments to more and more slowly returning orders, and would not therefore take place, unless the society were inclined to construct instruments of those orders. What the circumstances are, which determine individuals, and societies, to stop at this, or that order of instruments, will form the subject of the next chapter.
CHAPTER VI.
OF THE CIRCUMSTANCES WHICH DETERMINE THE STRENGTH OF THE
EFFECTIVE DESIRE OF ACCUMULATION.
It has been shown, in the preceding chapter, that, in communities where an extensive knowledge of the materials within reach of the industry of their members has generated numerous arts, we can assign no limit, in the nature of the materials themselves, to the capacity for the supply of future wants that might be given to them: but, that the instruments so formed, pass, by a gradual and uninterrupted progress, to orders of slower and slower return. It is scarcely necessary to observe, that the increase to the capacity which may be given to instruments, cannot be restricted by inability to devote additional labor to their construction; for, as all instruments at the period of their exhaustion return more than the cost of their formation, they give the means of reconstructing others, returning also, somewhat more largely than themselves. There are, nevertheless, in every society causes, effectually bounding the advance of instruments to orders capable of embracing a larger and larger circle of materials, and the determination of those causes is the subject, now claiming our attention.
Instruments are all formed by one amount of labor, or some equivalent to it, that is, by something either capable of yielding, or itself constituting some of the necessaries, conveniences, or amusements of life, and they return another greater amount of labor or its equivalents. The formation of every instrument therefore, implies the sacrifice of some smaller present good, for the production of some greater future good. If, then, the production of that future greater good, be conceived to deserve the sacrifice of this present smaller good, the instrument will be formed, if not, it will not be formed. According to the series in which we have arranged instruments, they double the cost of their formation in one, two, three, etc., years. Consequently, the order to which in any society the formation of instruments will advance, will be determined by the length of the period, to which the inclination of its members to yield up a present good, for the purpose of producing the double of it at the expiration of that period, will extend, according as it stretches to one, two, three, twenty, forty, etc., years will the formation of instruments be carried, to the orders, A, B, C, T, n, etc. and, at the point where the willingness to make there the sacrifice ceases, there the formation of instruments must stop. The circumstances therefore, on such occasions governing the decision of the members of all societies, must be the causes, fixing the point, to which the formation of instruments may in any society be carried, and beyond which it cannot advance. The determination to sacrifice a certain amount of present good, to obtain another greater mount of good, at some future period, may be termed the effective desire of accumulation. All men may be said to have a desire of this sort, for all men prefer a greater to a less; but to be effective it must prompt to action.
Were life to endure for ever, were the capacity to enjoy in perfection all its goods, both mental and corporeal, to be prolonged with it, and were we guided solely by the dictates of reason, there could be no limit to the formation of means for future gratification, till our utmost wishes were supplied. A pleasure to be enjoyed, or a pain to be endured, fifty or a hundred years hence, would be considered deserving the same attention as If it were to befall us fifty or a hundred minutes hence, and the sacrifice of a smaller present good, for a greater future good, would be readily made, to whatever period that futurity might extend. But life, and the power to enjoy it, are the most uncertain of all things, and we are not guided altogether by reason. We know not the period when death may come upon us, but we know that it may come in a few days, and must come in a few years. Why then be providing goods that cannot be enjoyed until times, which, though not very remote, may never come to us, or until times still more remote, and which we are convinced we shall never see? If life, too, is of uncertain duration and the time that death comes between us and all our possessions unknown, the approaches of old age are at least certain, and are duffing, day by day, the relish of every pleasure.
A mere reasonable regard to their own interest, would, therefore, place the present very t:ar above the future, in the estimation of most men. But, it is besides to be remarked, that such pleasures as may now be enjoyed, generally awaken a passion strongly prompting to the partaking of them. The actual presence of the immediate object of desire in the mind, by exciting the attention, seems to rouse all the faculties, as it were, to fix their view on it, and leads them to a very lively conception of the enjoyments which it offers to their instant possession. The prospects of future good, which future years may hold out to us, seem at such a moment dull and dubious, and are apt to be slighted, for objects on which the day-light is falling strongly, and showing us in all their freshness just within our grasp. There is no man perhaps, to whom a good to be enjoyed to day, would not seem of very different importance, from one exactly similar to be enjoyed twelve years hence, even though the arrival of both were equally certain.
Nor, while we retain any taste for pleasures, is it easy to prescribe limits to the extent in which we may indulge in them, or to the amount of the funds they may absorb. Every where we see, that, to spend is easy, to spare, hard. Every one indeed looks upon those in the rank immediately above him, as rolling in superfluous extravagance. But, in every rank, from the prince to the peasant, there are very many individuals, who have difficulty in procuring funds to defray the cost of articles, the expenditure of which they look upon as necessary to their condition, and, for the remainder, in the different classes, who have more than their utmost real desires would call for, pleasure is so entwined with extravagance, in the forms in which she presents herself to each, that it is difficult fully to embrace the one, without coming within the circle of the other.
It would then appear, that merely personal considerations, can never give great strength to the effective desire of accumulation. A future good, as concerns the individual, when balanced against a present good, is both exceedingly uncertain in its arrival, and in the amount of enjoyment it may yield, is probably far inferior. Such considerations would undoubtedly represent it, as a great folly to deny youth or manhood pleasure, that old age might have riches not to be enjoyed by it, but which, like the fabled monster in the garden of the Hesperides, it must employ itself with restless care to guard for others,
"Conservans aliis, quae periere sibi
Sieut in aurieomis pendentia plurimus hortis
Pervigil observat non sun poma draco."(34)
A prudent calculation of mere personal enjoyment, could prompt to nothing more than a provision for self, and would only lead to the making, as it is said, the day and the journey alike, and taking care, that youth should not want pleasure, nor old age comfort. But, as passion is ever getting the better of mere prudence, this limit would every now and then be exceeded, and in numerous instances, the satiety of riot would be succeeded by the miseries of want. Wherever a large amount of means for the gratification of the present existed, they would be squandered, and no one, on the other hand, would be inclined to make any great sacrifice of the present, for the purpose of providing for the future. The strength of the effective desire of accumulation would be low, and only such instruments would be formed as were of the quickly returning orders.
But man's pleasures are not altogether selfish. He receives pleasure, from giving pleasure, and is far from the perfection of his existence when he does not draw his enjoyments, rather from the good he communicates, than from that which he reserves. Without the ties which bind him to others through the conjugal and parental relations, the claims of his kindred, his friends, his country, or his race, life would be to most men a burden. These are its great stimulants, and sweeteners, giving an aim to every possible exertion, and an interest to every moment. If, sometimes, they shadow our being with cares and fears, those passing shadows but prove there is a sunshine. The light of life only disappears, and its dreary night then commences, when we have none for whom to live. Then the whole creation is a void. Really to live is to live with, and through others, more than in ourselves. To do so we must do so truly.
"Love, and love only, is the loan for love."
If the mere pretense deceive others, it mocks and tantalizes ourselves, encircling us with a joy as unreal, as that, which the looks and tones of affection shed round him, who receives them disguised in a borrowed garment. We cannot enjoy them, because we feel that they are not ours, but some other's whose dress we wear.
In so far as to procure good for others, gives a real pleasure to the individual, he is released from that narrow and imperfect sphere of action, to which his mere personal interests would confine him, and the future goods which the sacrifice of present ease or enjoyment may produce, lose the greater part of their uncertainty and worthlessness. Though life may pass from him, he reckons not that his toils, his cares, his privations, will be lost, if they serve as the means of enjoyment to some whom he may leave behind. These feelings, therefore, investing the concerns of futurity with a lively interest to the individual, and giving a continuity to the existence and projects of the race, must tend to strengthen very greatly the effective desire of accumulation. There would seem to be no limit to the possible extent of their operation. The more powerful and predominating they become, the greater must be their influence. It is true they are often feeble, and oppressed by other principles, and it is just as true that the world is full of deceit, hollowness, and unhappiness. As far as they exist, however, they form a real element, of great power in the determination of the course of human action, and one the nature of which would seem to indicate, and experience to prove, to be of great influence, on the particular part of it that forms our present subject. In the succeeding pages, the terms, the social and benevolent affections, will be employed to denote them.
The strength of the intellectual powers, giving rise to reasoning and reflective habits, forms another important element in the determination of the course of human action. These habits in opposition to the passions of the present hour, bring before us the future, both as concerns ourselves, and others, in its legitimate force, and urge the propriety of providing for it. Although therefore, were our cares limited altogether to ourselves, the greatest strength of the reasoning faculty, could prompt to but a very limited operation on the events of futurity, yet, the farther they extend to others, the wider is the circle of operations that it leads us to embrace. These two principles of our nature, the social and benevolent affections, and the intellectual powers, serve indeed mutually to move each other to action, the affections exciting the intellect to discover the means of producing good, the intellect opening up a channel to the affections by giving the power to do good.
All circumstances increasing the probability of the provision we make for futurity being enjoyed by ourselves or others, also tend to give strength to the effective desire of accumulation. Thus a healthy climate, or occupation, by increasing the probability of life, has a tendency to add to this desire. When engaged in safe occupations, and living in healthy countries, men are much more apt to be frugal, than in unhealthy, or hazardous occupations, and in climates pernicious to human life. Sailors and soldiers are prodigals. In the West Indies, New Orleans, the East Indies, the expenditure of the inhabitants is profuse. The same people, coming to reside in the healthy parts of Europe, and not getting into the vortex of extravagant fashion, live economically. War, and pestilence, have always waste, and luxury, among the other evils that follow in their train.
For similar reasons, whatever gives security to the affairs of the community, is favorable to the strength of this principle. In this respect the general prevalence of law and order, and the prospect of the continuance of peace and tranquillity, have considerable influence.
These seem to be the chief circumstances, determining the relations between present and future good, in the minds of those in any society, who have a mind and a will, at the time they are forming habits. When habits are once formed, they regulate the tenor of the future life, and make slaves of their former masters. There are, however, in every society, very many, who form habits, and pursue a certain line of conduct through life, not from any reasoning or choice of their own, but hurried on by the example of those around them, and the general direction in which the current of feeling and action sets throughout the whole body. It is evident, however, that the power that moves and directs the mass, lies not in them, but in those, who govern their conduct in whole, or in part, by their own feelings and passions, and the reflections which the situation of circumstances around them suggest to them. These form the great moving principle, the others, like the balance-wheel in an engine, merely keep up, and give uniformity, to the motion they generate.
The desire to accumulate would then seem to derive strength, chiefly from three circumstances.
1. The prevalence throughout the society, of the social and benevolent affections, or, of that principle, which, under whatever name it may be known, leads us to derive happiness, from the good we communicate to others.
2. The extent of the intellectual powers, and the consequent prevalence of habits of reflection, and prudence, in the minds of the members of the society.
3. The stability of the condition of the affairs of the society, and the reign of law and order throughout it.
It is weakened, and strength given to the desire of immediate enjoyment, by three opposing. circumstances.
1. The deficiency of strength in the social and benevolent affections, and the prevalence of the opposite principle, a desire of mere selfish gratification.
2. A deficiency in the intellectual powers, and the consequent want of habits of reflection and forethought.
3. The instability of the affairs of the society, and the imperfect diffusion of law and order throughout it.
The reader may perhaps conceive, that, in enumerating these different circumstances, and deducing the strength of the effective desire of accumulation from the preponderance of the one class over the other, I am attempting an unnecessary refinement, and that the principle of a regard to self interest alone, though it may not, of itself, give great strength to this desire, yet, from its combination with other springs of action, must, generally do so indirectly and ultimately and may, therefore, be assumed as a cause sufficient to account for the phenomena. If we confine our attention to the present times, and to particular parts of the globe, this may be readily admitted. Now, and in those places, a prudent regard to self interest would doubtless prompt many individuals to cooperate effectively in the increase of the general means of enjoyment. But there is nothing more apt to mislead us, when investigating the causes determining the motions of any great system, than to take our station at some particular point in it, and, examining the appearances there presented to us, to suppose that they must be precisely similar through the whole sphere of action. Because, in Great Britain, a regard to mere self interest, may now prompt to a course of action leading to making a large provision for the wants of others, we are, in reality, no more warranted to conclude that it will do so always, and in every place, than were the ancients warranted to conclude, because, in their particular communities, the pursuit of wealth commonly generated evil, that it must therefore do so always and in every place.
There seem to be, in modern times, and in particular communities, two circumstances, that may lead an individual, from a mere regard to his personal interest, to pursue the paths of sober industry and frugality, and, consequently, to make an extended provision for the wants of others. These seem to be the desire of personal, and family aggrandizement, and a wish, conjoined with the pursuit of both, to rank high in the estimation of the world. The acquisition of fortune, is a road open to the ambition of all men, and, in the present days, is the only road open to that of most men. The mere desire to rise in the world, and envy of the superiority of other men, may excite many to enter on this path, and preserve them steadily in it. This sort of spirit, however, must be kept in strict check, by a large surrounding mass of genuine probity, and tenderness of the happiness of others, or it certainly breaks out into disorders. There is none more easily tempted to evil, or more dangerous. It is the first to diminish the security of all compacts, and transactions of business, by fraud and exactions; it is the first to disturb the public tranquillity, by sedation and conspiracies. It is such a spirit, predominating over a character otherwise good, that Shakespear paints in Caesius. Caesar thinks him to be feared, because,
"Such men as he be never at heart's ease,
While they behold a greater than themselves;
And therefore are they very dangerous."
It is this temper that spurs him on, "in envy of great Caesar," to "humour, and win, the noble Brutus," to the assassination. It is the same spirit, that renders him unscrupulous,
"To sell and mart his offices for gold,
To undeservers ;"
and, to wring
"From the hard hand of peasants, their vile trash,
By any indirection."
When, therefore, the mere desire of distinction, is the object for which wealth is generally pursued, there, the pursuit infallibly, at length, withdraws from the path of virtue, and excites those engaged in it, to a disregard of their own honor, and the suffering of others.
"Magnum pauperism opprobrium jubet
Quidvis et facere et pati,
Virtutisque viam deserit ardueae."
When such is the character of only a small minority of those who pursue wealth, it is not injuriously felt. The energy of their motion, rather quickens the progress of the whole, than retards it. It is very different, when such characters compose the majority of those engaged in such pursuits. A chaos of deceit, treachery, knavery, is then generated, in which truth, generosity, good faith, compassion, perish. Hence it was, that the pursuit of wealth, in ancient times, was held as absolutely incompatible, with the lowest degree of liberal sentiment, virtuous spirit, or common honesty. Plato expressly says, that in commerce and traffic there is no such thing as an honest man, and numerous passages from the Greek and Roman writers might be cited in proof, that, in those days, it was admitted on all hands, that the character of the money-making man, was uniformly vicious. The following is one of the most striking I can presently find.
"It is impossible for the same man to be given to sensual pleasures, and to the love of money, and to be religious. For he who is a lover of pleasure will be a lover of money, and he who loves money, must of necessity be unjust, and a violator of the laws of God and man."(35) It is here not thought necessary to give any proof of the assertion, on the contrary, it is taken as an admitted fact, from which a consequence may be deduced.
In those times, therefore, the pursuit of wealth was disreputable, and the self-love of no one could be gratified by the character it procured him. We are apt to conceive the observation of St. Paul, that "the love of money is the root of all evil, and infallibly leads to wickedness," as springing from the ascetic spirit in which he contemplated matters, whereas it is common to him with all the moralists of his time, even with the most liberal of them, and must be held as a mere statement of what was then an obvious fact. Thus Horace calls it the same thing, "summi materiam mali," and the voice of the whole age agrees with him. An assiduous care to the increase of fortune was then esteemed evil, and the source of evil, and was reprobated accordingly. It was evil, because generally proceeding from a grasping, sordid, selfish spirit. It was the source of evil, because the great exciter of fraud, knavery, and violence. It is in more moral communities alone, where the real springs of action are not selfish, and where a desire for the good of others is one of the chief movers, animating the exertions, and giving a tone to the feelings and actions of the whole body, that the virtuous and liberal mind, sympathizes with, and approves the conduct of the man, who gives his days to labor, and his nights to engrossing care, for the purpose of increasing his gains. There, such a life is not deemed selfish, sordid, or unhappy, because there, it is known generally to proceed from a totally opposite spirit, and to have for its sustaining principle, the welfare of others, rather than of the individual; and there, it is esteemed praiseworthy, because there, its general tendency is good, not evil. There, too, ambition alone may, no doubt, lead those who want other motives into the paths of sober industry and frugality, because the desire of excelling in whatever is attempted, must impel individuals actuated by it, to every pursuit that other men gain credit by. It is not perhaps the object gained, so much as the gaining of it, (which gives it value in their eyes. But, it is only where such conduct procures consideration, and respect, that we can expect it will be steadily pursued by such persons. Where patient and assiduous industry, and undeviating integrity, procure the highest name, and fame, they will be followed by many who value them not in themselves. But this observation only proves, that we have to seek for the general course of action of the individual, in the circumstances determining that of the society.
In modern times, again, and in particular communities, marriage and offspring, and the consequent desire of family aggrandizement, may often succeed in imposing on those, to whom the welfare of others is naturally of little moment, the necessity of providing for that welfare, and therefore may often generate and, keep up a much stronger attention to the cares of futurity, than could be excited by a mere regard to self interest. But, it is to be observed, that the mode in which the passions prompting to marriage will operate, must depend, on the feelings, and consequently, manners, pervading the society. When the general feelings and morals become corrupt, marriage will never be sought after, by men in easy circumstances, for the mere pleasures of sense. Socrates remarks this to his son, when pointing out the obligations he owed him for giving him being(36) and every pure voluptuary is ready to curse, with Eloisa, "all human ties."
The indulgences to which these passions prompt, when the feelings become purely selfish, will, indeed, I suspect, be found to be the great weakeners of this very principle. Out of the heart are the issues of life, and the evils to which they give rise are the worst of any, because they contaminate the sources of all healthy energy and activity, at the very fountain head. It is to them, that Horace, in my opinion, truly traces, the load of mischief which in his time pressed on Rome, and which finally overwhelmed her;
"Faecunda culpae secula, nuptias
Primum inquinavere, et genus et domos:
Hoc fonte derivata clades
Inque patres populumque fluxit."
Even on the supposition of legitimate offspring, it is only in countries where the general sentiment applauds that course of action, that the man actuated by mere self interest, can be supposed to pride himself on rearing up and providing for a family, in preference to enjoying, without restraint, all the pleasures be may be able to procure. Cool, calculating, self interest, would thus speak. "Who knoweth whether his son shall be a wise man or a fool? Yet shall he have rule over all his labor, wherein he hath labored, and wherein he hath showed himself wise under the sun. This is also vanity. Wherefore I perceive that there is nothing, better than that a man should rejoice in his own works: for that is his portion: for who shall bring him to see what shall be after hin: it is good and comely for one to eat and to drink, and to enjoy the good of all his labor that he taketh under the sun, all the days of his life, which God giveth him, for it is his portion." We find accordingly that in states where mere selfish enjoyment is the chief principle of action, that the interests of posterity are neglected. Thus, among the Roman writers, the heir is always represented in an invidious light, and to save for him is represented as a folly. The writings of Horace, and the contemporary poets, throughout, exemplify the prevalence of this feeling.
"Parcus ob haeridis curam --
Assidet insano -- "
For a frightful picture of causes and effects, in this particular, the epigram of Martial to Titullus beginning,
"Rape, congere, aufer, etc."
might be quoted. But, it is time to conclude a digression, on which perhaps I have somewhat prematurely entered.
We shall then assume that there are motives, as above enumerated, derived from the principles of human nature, acting on all men, and exciting them to expend what they presently possess in providing for future wants, as there are others, derived from the same source, tempting them to lay it out in the gratification of their immediate wants. The strength of the effective desire of accumulation, in any man or society of men, or this desire manifested in action, is determined by the preponderance of the one class of motives, over the other. It is manifested, and may be measured, by the willingness of the individual, or individuals, to lay out a certain amount to-day, in order to produce the double of that amount at a period more or less remote, that is, at the expiration of one, two, three, etc. years.
CHAPTER VII.
OF SOME OF THE PHENOMENA ARISING FROM THE DIFFERENT DEGREES OF STRENGTH OF THE EFFECTIVE DESIRE OF ACCUMULATION IN DIFFERENT SOCIETIES.
The effective desire of accumulation is of different degrees of strength, not only in different societies, as compared with each other, but also in the several individuals composing the same society as compared together. Disregarding, however, for the present, the effects produced on the formation of instruments, from diversities in the strength of this principle among individuals in the same society, we are, in this chapter, to endeavor to trace solely some of those resulting from the operation of causes varying its strength in different societies. As has been already stated, there are three other causes operating in the formation of instruments; the quantity and quality of the materials owned by any particular society; the progress which the inventive faculty has made in it; and the rate of the wages paid the laborer. The first of these depending on the original constitution of the whole globe, and its different regions, and the correspondence between these and the corporeal system of man, is determined by circumstances, the consideration of which would be foreign to the present inquiry. With regard to our subject it is to be taken as an important but ultimate fact. The causes on which the progress of the inventive faculty seems chiefly to depend, will form the subject of a subsequent chapter. At present, the extent of that progress is to be received simply as a circumstance of admitted importance.
The rate of the wages of labor, the last of the causes affecting the formation of instruments, though a subject of investigation in itself highly interesting, and closely connected with this whole inquiry, is not, as has been already stated, to be otherwise considered in these investigations, than as an existing circumstance, the operation of which is also of importance in the determination of the extent to which the stock of materials, in possession of any society, will be wrought up by it, but the laws regulating which lie beyond our prescribed limits. So considered, a low rate of wages may be esteemed, in its direct effects, as producing the same results as an improvement in the quality of the materials operated on, or an extension of the power to operate on them, through an advance in the progress of invention. All these cause the same returns to be produced from a less expenditure, or greater returns, from the same expenditure. They all, therefore, place a greater range of materials within compass of the accumulative principle, and occasion the construction of a larger amount of instruments. The advance of invention, however, differs from a lowering in the rate of wages, in being a quantity to the increase of which we can set no bounds, whereas, we soon arrive at a limit to the possible diminution of the rate of wages. In the principles on which they depend, and in their ulterior consequences they differ, I believe it will be found, still more widely.
The first example I shall take, of the effect of circumstances in moulding the characters of communities, and of these again, in determining the extent to which they carry the formation of instruments, will be that of the American Indian.
The life of the hunter seems unfavorable to the perfect developement of the accumulative principle. In this state man may be said to be necessarily improvident, and regardless of futurity, because, in it, the future presents nothing, which can be with certainty either foreseen, or governed. The hunting grounds are the sources from which, among hunters, the means of subsistence are drawn. But these belong to the nation or the tribe, which alone therefore, can make more abundant provision for futurity by securing to itself a domain more extensive, or better supplied with wild animals; or meet poverty, by being restricted to one more narrow, or barren. As regards his future means of living, every member of such a community thinks of nothing but whether the supply of game will be plentiful, or scanty; in the one case, he knows that he will enjoy abundance, in the other that he must endure want. In such societies therefore, the view can never be directed to any distant future good, which present exertion may secure to the individual, but is confined to what, by that exertion may be added to the power, or the territory of the tribe. What applies to the individual hunter, applies to his family. Their comfort depends less on his particular exertions, than on circumstances affecting the whole band, or little nation to which he belongs. It is only in infancy that the wants of the young savage are, to any great extent, provided for by his parents. Afterwards he feasts, or fasts, like every other member of the community, as abundance, or scarcity reigns in the camp. That camp, indeed, may be said to form the family of the Indian. His whole thoughts, and affections centre there, nor has he any cares for a distant futurity, either for himself, or his offspring, separated from the common sufferings or enjoyments of his tribe.
Were the causes determining the future good or evil flowing to each of these great families, to be within reach of the energies of the individuals composing them, they would have a steady aim for their exertions, and having the means, might acquire the habit of purchasing future plenty, and security, by present toil, and privation, and of tracing out with certainty, remote consequences, to immediate acts. But this is a mode of thought and action, to which the circumstances of their condition are opposed. As the utmost prudence, foresight, and fortitude, can but little affect the future welfare of the individual, so, their power to promote the prosperity of the society, is limited and precarious.
If a tribe of hunters occupy a healthy territory, and one plentifully supplied with game, they are pressed on by others, eager to seize on these advantages, and so are continually engaged in destructive wars. While the individuals composing such a tribe, can slaughter their foes, that is, the surrounding tribes, or can drive them to a distance, they want for nothing. The defeat of their own tribe, is the only calamity they have to dread. This calamity is every now and then overtaking them.
War is always a game of hazard. In such a state of society it is peculiarly hazardous. There the art of war is surprise. The scanty population which the chase can alone maintain, is divided into small bands, living widely apart -- mere points in a vast continuity of wilderness. In such situations warfare can never be open. The attacking party must advance with secrecy; were they to make their approach known, their enemies would only wait for them, if convinced of their own superiority; otherwise, they would retire, and, if acting prudently, and skilfully, never suffer themselves to be seen, unless to strike their foes, themselves being safe, in some well-conducted ambush. But where success depends upon concealment, and surprise, it also depends on chance. into precautions can succeed in always guarding a small band, encamped in the midst of a great forest, from being unexpectedly assailed. No precautions can prevent the track of a party advancing, through an enemy's country, from being occasionally discovered. Victory, or defeat, and all that follow them, depend on the slightest accident. Fortune is a goddess, on whose influence the schemes of the most skilful, and greatest captains, are always in some measure, dependent, but here she reigns supreme.
The effects of these circumstances are increased by the character of the laws of war of the savage. His wars are wars of extermination. They cannot well be otherwise. Were he pressed to defend, what he thinks requires no defence, but is prepared alike to execute on others, or suffer himself, he might so do from the necessity of the case, the plea which man always urges for every evil he inflicts on his fellows. He can neither safely let his enemies go, nor possibly retain them captive. In the former ease they would be as much to be dreaded as ever. In the woods half a dozen men may make war upon a nation, as wars are there conducted. That is, they may waylay, surprise, and slaughter detached parts of them. Nor can he retain captives. They would both be useless, and must escape. A plunge into the surrounding forest sets them free. Hence it is not conquest, as with other warriors, but destruction, that is his aim, and what he executes on others, when he has the power, he sees continually impending over him, from them, when fortune gives them the power.
Thus the whole existence of the hunter is chequered by quick changing extremes. Abundance, famine, the fierce joys of victory, the horrors of surprise and defeat, rapidly succeed each other, in an order which he can neither pretend to foresee, nor direct. Like all men in similar circumstances, he refers the events, of which his being is the sport, to the continual and capricious agency, of supernatural powers. All the good that happens to him, is from their having been propitious to his designs, and from his having rightly interpreted their omens; all the evil that befalls him, arises, in his conception, from their hostility, or from his having mistaken, or neglected, some vision, or token they sent him. The warrior turns back, in the middle of an expedition, if his sleep be disturbed by a dream betokening evil; the unsuccessful hunter accuses neither his unsteady hand, nor imperfect sight, but some magical influence banging on his weapon which only the priest or sorcerer can therefore remove. The direction of all events whose arrival is distant, seems thus to the hunter of the woods to lie entirely beyond his control; and, instead of endeavoring to make the ease, or abundance of the present, provide for the evils of the future, he prides himself in enjoying the good of to-day undisturbed by a single care, and, in feeling, and knowing, that he can bear the ill of tomorrow without a murmur.
Hence the Indian has a character altogether his own. Feeling himself hurried on by the course of events, not directing it, he thinks as little of refraining from the pleasures that course may offer him, as of shrinking from the pains to which it may expose him, and indulges, therefore, without restraint, in the enjoyments of the hour. His intellectual faculties, unaccustomed to deduce remote consequences from immediate causes, and still less accustomed to adopt as a ground for action, and to watch, carefully, and anxiously, any concatenation of the sort, are feeble; either in themselves, or from inaction.. His passions, on the contrary, are strong. Unaccustomed to reflection, the warm and generous feelings of affection and gratitude, as well as the darker ones of hatred and revenge, are often formed hastily, and on inadequate grounds, but while they last they are exceedingly vehement. His tribe forms the point in which all these feelings centre; it is in fact his family, with which all his joys and sorrows are in common.
An attention to the effects, naturally flowing from this character, will explain many circumstances in the present condition, and past history of these tribes, which are in themselves interesting, and which are closely connected with our subject. Of all those circumstances, none is more remarkable, than their neglecting, or refusing, to adopt the arts, of the new neighbors which the discovery by Europeans of the country they inhabit, brought, and has kept in contact with them. Surrounded as are the scattered wrecks of those once numerous tribes, by a great people, rapidly converting the soil, and almost whatever grows on it, or is hid beneath it, into instruments, capable of plentifully supplying every variety of future want, they are yet unable to imitate them. This deficiency among them, of the effective desire of accumulation, the principle leading to the formation of instruments, seems to arise both from a want of motives to exertion, and from a want of the principles and habits of action which would lead to effective exertion.
The settlement of their country by the European race, has in itself, gradually diminished, or entirely destroyed, the political importance of their tribes, and consequently, the ties binding together the members of each of these communities, and leading them to feel, and to act, in common. Nor have these been replaced by others. Those growing out of the family relations, in other states of society,--the anxious prospective care of the parent, and the exertions, the pleasures, and the duties thence arising,- have not had time to spring up. Hence the Indian continues to seek shelter in apathy, and to regard life and its enjoyments, both for himself and his children, as did his forefathers, gifts to be made the most of while they last, but which no care can secure, and which, therefore, it is his business not to provide for the continuance of, but to learn calmly to resign when called on. He thus sits, listless, in the midst of the incessant activity and industry that surround him, incapable of discovering an adequate cause for the never-ceasing care and toil. The motives that excite the white man, though possessed of means that would enable him with his more needy brethren, abundantly to enjoy the present, to devote himself, instead, to labors, to which no season brings a respite, in order to bring about events, that may provide for the wants of some remote and uncertain futurity, are to him incomprehensible. Instead of applauding the conduct, in his secret soul he censures the mean, timorous, and, as it seems to him, selfish spirit, which prompts it.
But, besides a want of the motives exciting to provide for the needs of futurity, through means of the abilities of the present, there is a want of the habits of perception and action, leading to a constant connexion in the mind of those distant points, and of the series of events serving to unite them. Even therefore, if, motives be awakened capable of producing the exertion necessary to effect this connexion, there remains the task of training the mind to think, and act, so as to establish it.
These deficiencies in the motives to exertion, and in the habits of action of the Indian, serve to account for the condition of the remnants of the tribes scattered over the North American continent, in situations where they are in contact with the white man. There is a general similarity throughout, that will, I believe, render an example, taken from one part of the continent, sufficiently illustrative of the state of the whole.
Upon the banks of the St. Lawrence, there are several little Indian villages. They are surrounded, in general, by a good deal of land from which the wood seems to have been long extirpated, and have, besides, attached to them, extensive tracts of forest. The cleared land is rarely, I may almost say never, cultivated, nor are any inroads made in the forest for such a purpose. The soil is, nevertheless, fertile, and were it not, manure lies in heaps by their houses. Were every family to inclose half an acre of ground, till it, and plant in it potatoes and maize, it would yield a sufficiency to support them one half the year. They suffer too, every now and then, extreme want, insomuch that, joined to occasional intemperance, it is rapidly reducing their numbers. This, to us, so strange apathy proceeds not, in any great degree, from repugnance to labor; on the contrary, they apply very diligently to it, when its reward is immediate. Thus, besides their peculiar occupations of hunting and fishing, in which they are ever ready to engage, they are much employed in the navigation of the St. Lawrence, and may be seen laboring at the oar, or setting with the pole, in the large boats used for the purpose, and always furnish the greater part of the additional hands, necessary to conduct rafts through some of the rapids. Nor is the obstacle aversion to agricultural labor. This is no doubt a prejudice of theirs; but mere prejudices always yield, principles of action cannot be created. Where the returns from agricultural labor are speedy, and great, they are also agriculturists. Thus, some of the little islands on lake St. Francis, near the Indian village of St. Regis, are favorable to the growth of maize, a plant, yielding a return of a hundred fold, and forming, even when half ripe, a pleasant and substantial repast. Patches of the best land on these islands are, therefore, every year, cultivated by them, for this purpose. As their situation renders them inaccessible to cattle, no fence is required; were this additional outlay necessary, 1 suspect they would be neglected, like the commons adjoining their village. These had apparently, at one time, been under crop. The cattle of the neighboring settlers, would now, however, destroy any crop, not securely fenced, and this additional necessary outlay, consequently bars their culture. It removes them to an order of instruments, of slower return, than that which corresponds to the strength of the effective desire of accumulation, in this little society.
It is here deserving of notice, that what instruments of this sort they do form, are completely formed. The small spots of corn they cultivate are thoroughly weeded, and hoed. A little neglect in this part would, indeed, reduce the crop very much; of this experience has made them perfectly aware, and they act accordingly. It is evidently not the necessary labor, that is the obstacle to much more extended culture, but the distant return from that labor. I am assured, indeed, that, among some of the more remote tribes, the labor thus expended, much exceeds that given by the whites. The same portions of ground being cropped without remission, and manure not being used, they would scarce yield any return, were not the soil most carefully broken, and pulverized, both with the hoe and the hand. In such a situation, a white man would clear a fresh piece of ground. It would perhaps scarce repay his labor the first year, and he would have to look for his reward in succeeding years. On the Indian again, succeeding years are too distant to make sufficient impression, though, to obtain what labor may bring about in the course of a few months, he toils even more assiduously than the white man. The wages of labor with him, are lower than with the white man, for his wants are fewer. But for this, the range of materials, coming within reach of his effective desire of accumulation, would be even more limited than it is, and the amount of instruments formed by him, less.
Similar observations will apply to all the remnants of the race, scattered through the parts of the North American continent, to which the industry and enterprise of the white man, have brought modern arts and civilization. They can no where be said to form an agricultural people. All the great tracts of land, reserved for their use, throughout the continent, retain their native forest character; and it is only at great intervals, where spots of soil appear offering peculiar facilities for cultivation, that the riches of the earth are even partially brought into action. When such materials are neglected, it is not to be supposed that others, requiring greater strength of the accumulative principle to form them into instruments, will be put to use. None, therefore, even of the most common handicrafts, which they see the white man continually exercising, are to be found among them. The axe, and the knife, are almost their only tools. Their houses, their furniture, their clothing and utensils are all similar, and of a sort to serve only the needs of the moment. Nothing is either reserved or provided for a futurity in any ways distant. Their stock of instruments being thus confined to such as are of the most quickly returning orders, a vast mass of materials is neglected, which by another race, governed by other principles of action, are converted, or converting, into the means of abundantly supplying the necessities, and enjoyments of a numerous population. They thus afford a striking instance, of the effects resulting from a great deficiency of strength in the accumulative principle. They have skill, adequate to the formation of instruments, capable of ministering to the necessities and comforts of a numerous population, for with the powers of fire, the axe, and the hoe, the great agents in converting the forest to the field, they are well acquainted; they have industry, content with a very moderate, if immediate reward; yet, from inadequate strength in this principle, these all lie inert, and useless, in the midst of the greatest abundance of materials; and, the means for existence in the time to come not being provided, as what was future becomes present, want and misery arrive with it, and these tribes are disappearing before them. The white man robs their woods and waters of the stores with which nature had replenished them, and the arts, by the communication of which he would compensate for the spoliation, are despised.
Though the civilized man may be truly said to have been the greatest enemy of the Indian, yet he has not always been so wilfully, and, in many instances, he has endeavored to be his benefactor. But, though his endeavors may occasionally, for a time, have arrested the progress of the evil, they have never altogether removed it, or been of permanent advantage. Of all attempts of the kind, that of the Jesuits, in Paraguay, seems to have been productive of most good, and to have given the fairest promise of ultimate success. This partial success, is evidently to be traced, to the usual talent of those fathers, in a clear perception of the actual circumstances of the condition, and disposition of the men with whom they had to deal, and to their usual ability in converting these circumstances into means of accomplishing the ends they had in view.
Their plan presents two great features. They wrought upon the Indians through that, which was alone in them capable of exciting to extended action, their love of their several nations, and devotion to their interests: they took every means to show them that they could, and would, promote these interests, and thus identifying themselves with the national existence and prosperity, transferred to their order, a large portion of the strong feelings arising from benefits received from, and obligations and duties owing to his tribe, which are the great movers, and rulers, of the being of the Indian.
The efforts of the missionaries seem first to have been directed to convince the chiefs, and leaders, of the several tribes to which they penetrated, of the sincerity of their desire to be of service to them. As the messengers of a religion, promising peace on earth, and immortal happiness after death, they had claims on their attention which are foreign to our subject. Besides these however, as the possessors of the arts and powers of civilization, they had others, which were more palpable to the comprehension of the savage. Europeans were known by this unfortunate race, as possessors of powers so great, as to appear supernatural; but they bad hitherto been known only as enemies and oppressors, the bearers of unspeakable calamities or utter ruin. Once then they were convinced, that the white men who now came to them, were really friends, and were desirous of exerting those powers for their preservation and happiness, which had hitherto been employed for their destruction, they were ready to welcome them as their best benefactors, and most powerful protectors. The usual intelligence, prudence, and fortitude of the fathers did not desert them on this occasion, and, though not without the expense of the martyrdom of several of the order, they succeeded in impressing the Indians with the belief, that they were really their friends. The rest of the task was comparatively easy. Convinced on this head, the savages willingly, and immediately, became docile disciples. Fully satisfied of the advantages, which European arts give to a people, they set themselves with zeal to acquire and practise them, for the benefit of their several tribes. Though not for his individual advantage, or that of his family, would the Indian sacrifice present pleasure or embrace present toil; for the good of his nation he had been taught, and was ready to hear, or forbear, any thing. The Jesuits had, therefore, only to teach what it was necessary to do, or endure. The details they have left us of their progress, are generally interesting, sometimes amusing, not unfrequently, to those unacquainted with the peculiarities of the Indian character, almost incredible.
They themselves, in the first instance, taught their proselytes bow agricultural operations were to be performed, by taking the spade, and other instruments, in their own hands. But, when thus, by precept and example, they had brought them to be able to execute the several operations of ploughing, sowing, reaping, etc. the difficulty was but half over. Without the constant superintendency, and vigilance, of their instructors, they never would have practised them. Thus, at first, if these gave up to them the care of the oxen with which they ploughed, their indolent thoughtlessness would probably leave them at evening still yoked to the implement. Worse than this, instances occurred where they cut them up for supper, thinking, when reprehended, that they sufficiently excused themselves by saying, they were hungry.
By the indefatigable perseverance, and dexterous management of the missionaries, they were, however, at last, brought so to labor the earth, as, in that fertile soil and warm climate, to produce abundant returns. They were also at peace with one another, and feared by their enemies. The tranquillity, the security, and the plenty, they thus enjoyed, gave the Jesuits additional claims on their confidence and gratitude, which the good fathers seem to have taken care should be made sufficiently apparent to them. Hence it was, as Charlevoix tells us, that they thought they could never sufficiently testify their affection and gratitude for those, who had rescued them from barbarism and idolatry, and who, in spite of the most severe persecution, and the greatest toil, had procured them all the advantages they enjoyed. They continually recalled to mind the miserable state from which they had been brought, the parents instructed their children, and they saw, with their own eyes, the condition of the neighboring nations, who had not participated in their happiness. It was by no means wonderful, as he continues, that these things produced an attachment for the missionaries, that was without bounds.
The additional authority and influence thus acquired, they employed in enforcing stricter obedience, and increased industry, and gradually leading on their disciples to the practice of the finer and more difficult arts. In this they perfectly succeeded, so that there were every where to be seen, says the same author, workshops of gilders, painters, sculptors, goldsmiths, watchmakers, carpenters, joiners, dyers, etc. In the exercise of these useful and ornamental errs, we must not suppose the artists -were animated by the motives that excite similar labors elsewhere. They seem scarcely to have bad an idea of personal property, or individual gain, but to have been as mere children, looking up to the Jesuits for every thing, and ready to do every thing for them, or submit to any thing from them.
"These fathers," says Ulloa, "have to visit the houses, to examine what is really wanted; for, without this care, the Indians would never look after any thing. They must be present too, when animals are slaughtered, not only that .the meat may be equally divided, but that nothing may be lost." "It has been necessary," says Charlevoix, "to appoint superintendents, who inspect every thing accurately, and see if they are busy, if their cattle are in good condition, etc. The labors of the women are regulated, as well as those of the men. At the beginning of the week, there is distributed among them, a certain quantity of wool, and cotton, which they are obliged to return, on Saturday evening, ready for the loom. But, notwithstanding all this care and superintendence, and all the precautions which are taken to prevent any want of the necessaries of life, the missionaries are sometimes much embarrassed. This proceeds from three defects, of which the Indians have not yet been corrected, their improvidence, indolence,(37) and want of economy, so that, it often happens, that they do not reserve themselves a sufficiency of grain, even for seed. As for their other provisions, were they not welt looked after, they would soon be without wherewithal to support life." The mode of operation, which the Jesuits adopted, had undoubtedly the advantage of bringing out all the energies of the Indian. He was thus induced willingly, and therefore zealously, and successfully, to apply his powers to the acquisition and practice of European arts, and, while the missionaries maintained their power, and formed a part of the polity which their sagacity and perseverance had established, it gave every token of prosperity and vigor. Their prudence and providence led into efficient action the desire, which every individual felt for the future prosperity of his tribe. The powers of the social and benevolent affections of the mass had free course, and what was wanting in intellectual energy, being supplied by the fathers, the desire of accumulation of the whole body became sufficiently effective and strong, to form a larger stock of instruments. What, therefore, might, at first sight, strike us as the most difficult part of the project, the establishing a community of goods, and interests, was, in reality, that which rendered it of easy execution. With all the advantages attending such a form of society, the freedom from strife, jealousy, contention, and care, enjoyed by the great majority, it had also the disadvantage of requiring, and therefore exciting, in the multitude, little, or no exertion of the intellectual faculties. The converts had become, or were becoming, mere machines in the hands of the missionaries. the whole stock of instruments Formed by the common labor, was in the possession of the fathers, and the share which the Indians received of the returns, depended on their pleasure. They were in fact regarded as beings of a superior order, whose actions were of necessity right, and whose slightest wishes were laws.
If we judge from what is known of the state of the American continent at its discovery, it would seem that this form of society, is that which the hunter, changing directly to the agriculturist, naturally assumes. His devotion to the interests of the tribe, passes there into affection for the person, and blind obedience to the will of the chief. The accounts we have of the condition of the kingdoms that the Spaniards found established in the most fertile regions of the continent, describe the power which the rulers possessed, and the reverence paid them, as excessive. The people seem to have, in general, approached the condition of slaves, and to have had a large share of the defects of that condition, a want of intelligence and energy.
Our own barbarian ancestors, such as they are described by Tacitus, have been often likened to the savage aborigenes of North America. But, though there may be some points of resemblance, the parallel will be found to fail, in several important particulars, which, as they seem to have operated through the influence they have exerted on that principle, the effects of which we are at present considering, may be allowed to claim our attention for a little.
The race, whose occupation of the forests and wildernesses, to the northward of the Roman Empire, made these, in the days of its strength, to be regarded as the regions of mystery and wonder, in those of its weakness, of well-rounded, and increasing anxiety, and dread, were properly shepherd warriors. Though the excitement of the chase frequently gave fit employment to their ardent spirits, and its toils to their hardy frames, and though its products ministered to many of their wants, their cattle were yet their main support, and to provide for the sustenance of these, their great business. But the possession of flocks and herds, implies a considerable degree of care and foresight, both in protecting, and making provision for them, and in avoiding to consume too great a number of them. It also implies the existence of private property to a large amount, and, consequently, of strength in the ties binding families together. The parent, if he desires to see his offspring enjoy plenty, must exert himself to procure it for them. The performance of this duty gives him claims on their gratitude, and draws closer the connexion between them. The sort of life they lead too, demands less of severe exertion, and affords longer intervals of ease. It brings them together in larger bands and societies, of which each member has rights to defend, and interests to provide for, and thus produces the rudiments of law, justice, and the policy of civilized society.
War may be said to be natural to them, as well as to hunters, but it is always open; concealment is out of the question; their greater numbers, and the necessity of having always with them a large train of domestic animals, render it impracticable. They have not therefore to fear being surprised and overcome, before they can have time to defend themselves. Hence, the members of a numerous and warlike pastoral nation, live in comparative security. They see that chance has less influence, prudence and resolution more. They perceive that they are not altogether the sport of destiny, but that their fate depends, in a great measure, on themselves. Their minds are less shaken, and their judgments less clouded by superstitious fears and imaginings. The greater security they enjoy renders them also less relentlessly cruel. Utterly to exterminate their enemies is not necessary; to break, and drive them off, is sufficient. When, therefore, the fury of the fight is over, mercy has, with them, a place.
All these circumstances pertaining to the condition of pastoral nations tend strongly to excite the social and benevolent affections, and the powers of reason and reflection, and to give scope to their action among them. The pastoral ancestors of the present European race were fierce, cruel, and vindictive barbarians; yet, spite of these forbidding features of their character, we can as distinctly trace to them the sources of all the more generous. and sorer virtues, that give happiness to their descendants, as we can the free and independent spirit that bestows on them liberty and security. Such nations have, therefore, naturally a much higher effective desire of accumulation than nations of mere hunters. The strength of this principle, in fact, seems with them in general, so great, as to incline them to form instruments requiring a much superior degree of providence and self-denial, to that indicated by the breeding of cattle. They are 'prevented from doing so, by their wandering life, and by the wars in which they are necessarily constantly engaged. When, for instance, they are settled in a country suited to agriculture, and to which the knowledge of the art has penetrated, they have a tendency to become agriculturists; that is, to change the land, from which they draw their subsistence, from an instrument yielding a large return, in proportion to the labor bestowed on it, to one yielding a still larger return, though requiring proportionally more labor and time, and being, therefore, of a more slowly returning order.
But such a change, though increasing the whole population of the state, leaves fewer in it who can be spared from labor, and, consequently, fewer soldiers. In pastoral nations, almost all the men are warriors; in agricultural, only a few can be withdrawn from the labors of the field. The latter are therefore, naturally inferior to the former in military prowess, and are consequently subject to be conquered and destroyed by them. Such seems to have been the fate impending over Gaul, from the side of Germany, when the appearance of Caesar gave another turn to affairs. The Gauls, we learn from him, though then inferior, had once been superior, in military renown, to the Germans. It appears likely, that the revolution had been occasioned, by their becoming an agricultural people, which they, in a great measure, were, in his time. The Germans, again, preserved themselves from the fatal effects of such a change, by the singular national custom, or constitution, that obliged them all, every year, to exchange the lands they respectively occupied. By this constant transfer of instruments, and of the materials of which they might be formed, they took away every inducement to work them up into orders of slow return, and confined the members of the community to the pastoral condition, which experience had doubtless instructed them, was most favorable to military prowess.
In the times of the Caesars, Europe was thus divided, by an irregular line running east and west, into two great parts, the one occupied by the barbarians, the other by the Empire. To the northward of this line, were many rude nations, strong in the mental and corporeal energies of the individuals composing them, and in the willingness of each to devote his abilities to objects conducive to the good of all, but whose strength was largely expended in furious intestine wars. These contests, destructive as they were, did not, however, occasion any progressive diminution of the vigor of the whole body; it was only the surplus powers of the parts that thus ran to waste. The strength of the people of the empire was, on the contrary, derived, from their union in one great body, and the power thence resulting of the energies of the whole being directed to any particular point. But this union, as it had been produced by compulsion, augured weakness in the several parts, and was the cause of weakness. What each contributed to the common good was not of will, but from necessity, and, in the strife thus arising, every man learned to consider his own good as separate from that of all others. Hence a continually increasing separation of interests, and consequent continual decrease of power and general decline. The gradually increasing weakness of the empire, while the strength of the nations to the northward, if not augmenting, remained at least unimpaired, rendered the arrival of a period when the former should be Overpowered by the latter inevitable. These barbarians believed, that the riches of the earth belonged, of right, to the best; according to their creed, the bravest. Their most powerful and warlike tribes, therefore, possessing themselves of the more fertile regions, those bordering on the line dividing them from the empire, pressed violently against it, and, opposed by a force continually diminishing, at length burst through it.
Three great events, each leading on this other, would seem to have been the necessary consequence of this revolution. Of these, the first was the occupation of the whole continent by the barbarians, and the driving back the still onward-urging host of their brethren; the adoption by them of the arts which had previously flourished in the empire, and their becoming an agricultural people, was the second; and their running the chance of being in turn overpowered by the northern warriors, the third. Until the arrival of the first period, when, the continent having been completely overrun and ravaged by the barbarian multitude, had assumed a form closely approximating to that of the territories they had formerly occupied, there could be no approach to rest, but the tide must still advance. When the receptacle vacant for its reception was once completely filled, the mighty mass had to recoil on itself. The battle of Chalons fixes this period. Europe, with the exception of the corner occupied by the Eastern Empire, and which belonged rather to Asia than to it, seems then to have been nearly reduced to the state of one immense cattle-pasture. But the impetus that had been given still continued, and new hosts crowded on to share that, of which the last fragments had been divided. The vastness then of necessity took place. The hosts of the west and the south, under Theodoric and Elius, met those of the east and the north, under Attilla, on the plains of Champaigne. The vastness of the masses and the violence of the shock are shown by the destruction produced; the accounts of the period rating the slaughter variously at from one hundred and sixty-two thousand to three hundred thousand.
From this period the great body neither much advancing nor receding, was agitated chiefly by fierce internal commotions. The time when their violence terminated marks the second period, when the general prevalence of agriculture, lessening the number of warriors, diminished the extent and frequency of wars. The knowledge of the elements of it, and of the other arts, diffused throughout the various multitude that now peopled the Continent, could not forever lie dormant. It has been already observed, that the strength of their effective desire of accumulation, had been such as to produce a tendency among them to give greater capacity even to the materials of which they had the command in the northern regions, though at the expense of changing them into instruments of somewhat slower return, by converting their lands from pasture to tillage. This tendency became inevitably stronger, as they advanced into more fertile soils and milder climates. The revolution itself took place gradually. The exact date of the preponderance of the one condition over the other, cannot, perhaps, be determined but by the effects produced by its arrival. It is only in the state of hunters, or shepherds, that nation can literally go to war with nation. In the agricultural state, it is not the men of the nation, but a small part of them, the soldiery, that fight. Taking this as the criterion, we might fix the reign of Charlemagne as that, in which war, as the business of European nations, properly ceased. The conclusion of that monarch's reign, has sometimes been reckoned the commencement of a period of weakness in the several states, and of want of ability in their monarchs. The historian, it is true, for centuries afterwards, finds no events that he esteems great to record. His art can call up no pictures of heroes leading armies to the field, conquering, or being conquered, overthrowing, or establishing kingdoms. Nevertheless, if the view we are taking is correct, it is from this era that we must date the commencement of strength, not of weakness. The people of Europe then began to rise in the scale of industry. They commenced a new era, to which no one can assign a positive termination, because it became their occupation to conquer nature, and not man, and, to the fruits of the one conquest, we can set no limit, whereas the utmost advantages of the other are very speedily exhausted.
It may here be observed, that the difference of the strength of the principle of accumulation in nations of hunters, and in pastoral nations, seems to mark out a very opposite destiny to a great country overrun by the one, to that which would await it from being subdued by the other. The naturally low degree of strength of the accumulative principle among nations of hunters, prevents them, as we have seen, from forming instruments of sufficiently slow return to embrace the materials to which the arts of civilized life might give capacity. While in their possession, therefore, they lie unemployed, and useless. The progress of civilization and art, over the continent of North America, is now, every day, bringing to light traces of their former presence, and evidence, consequently, of the existence there at some remote period, of a people far superior in these respects to the tribes that occupied all but the southern parts, when discovered by Europeans. The question has been asked, how did it happen that they, and the knowledge and power they possessed, utterly perished? In other instances, civilization has either protected its possessors, or, if they were overcome, has reacted on their conquerors, and spreading among them, has, so to say, subjugated and governed them in turn. The history of our own barbarian ancestors has been quoted, as a circumstantial account of this seemingly natural progress. But, if the principles, the operation of which forms our present subject, be correct, they furnish a sufficient cause for the diversity of effects, flowing from the two events, and show, that, instead of there being any reason for surprise at the hunter of the woods disdaining the labors and rewards of civilization, it is rather our business to inquire how he could ever have been led to adopt them. Had the nations whom the north poured forth on the south of Europe, been hunters, and, had no extraneous cause intervened, it is not improbable, that that continent would, even at the present day, have been one wide forest from side to side.
The third of the great events referred to, the evils and dangers arising to the ancestors of the present inhabitants of Europe, from their former brethren of the north and east, when the strength of their accumulative principle led them to put off the barbarian, and employ themselves in giving to the materials within their reach the capabilities for the supply of the wants of futurity which art showed that they possessed, were felt for many centuries. The change they were then undergoing, though it added very greatly to the total numbers of the several nations, lessened the numbers of the warriors. The instruments they formed being of the more slowly returning orders, though the whole income from them was much greater, the labor necessary to produce it was more than proportionally greater, and the portion of the population left free for the purposes of warfare was consequently less. It were foreign to our purpose farther to allude to this cause of commotion and revolution, than to observe, that the mischiefs and dangers arising from it, seem to have been moderated by the very gradual manner in which the change took place, and to have been counteracted, and finally overcome by the additional power acquired through the progress of invention in the arts of civilized life.
The next example I shall adduce, of the influence of the accumulation principle, will be that of the Chinese Empire. All accounts agree in ascribing to the people of this Empire, a peculiarity running through the whole structure of their social and domestic life, by which alone perhaps its mechanism can be well explained, and which seems to form its great governing and sustaining principle. Their moralists and legislators appear to have successfully endeavored to give to the feelings, naturally springing from the parental and family relations, an influence and authority, far superior to what these possess among other nations, -- the power and unity of a regular system of duties and obligations. A father, as the immediate, though secondary cause of existence, is regarded with much of the .feelings that are elsewhere reserved for the infinite and eternal fountain of all existence, power, and perfection, and, consequently, claims, as a sacred right, a measure of love, reverence, and obedience, that to us seems perfectly unnatural. Both while alive, and after his death, he is reverenced, we might say adored. His descendants form a little distinct society bound together by the strongest ties, a system apart from all others, having a common centre of action of its own. What is conceived to be a reality in families, is metaphorically applied to the whole empire, and its several parts. The emperor is the father of his people, his affection for them as his children is held to be the animating principle of his actions, implicit obedience to him as their parent, who can only command what is good, is the first duty of his subjects. Each inferior magistrate is also regarded as the father of those over whom he. rules.
The result has been so far happy, that the harshness of despotism is somewhat tempered by the mildness of the paternal character. We are so constituted, that no part can be assumed, and habitually acted, without, in some degree, moulding our nature to its form, and making that a reality, which may at first have been only a fiction. It has also been happy in the strength it has given to the connexions and affections of those belonging to the same family, or springing from the same stock. A man must be strongly excited to good, and deterred from evil, by being aware that his actions and fortunes are the objects of solicitude to every member of the little community to whom he is bound by the ties of blood and kindredship; that they rejoice at whatever he accomplishes that is honorable and happy; and are afflicted and disgraced by his imprudencies and errors.
But, viewing the system on another side, we may perceive that evil has sprung out of it. The blending of the characters of parent and lord, and thus making of each head of a family an absolute master, the judge of right and wrong, places man in a situation dangerous to his weakness. It may encourage, at all events, it enables him to gratify without fear, whatever vice or immorality is not necessarily open or declared, but may have a veil, however thin, of outward decorum thrown over it. Besides this, the absolute submission and unreflecting obedience, which it inculcates, are much opposed to the expansion of the intellectual and moral powers. When all impulses are from without, it is impossible that the mental eye should turn steadily on the divinity within, or promptly and resolutely execute, what it dictates.
We perceive a great attempt to organize a society, animated by the principles of love and affection, regulated by those of virtue. The form indeed exists, but under it there is little substance. Hence is generated a mass of apparent contradictions; viewed in one light, we see a great family, wisely and beneficently governed; in the other, a servile herd, crouching beneath the sharp lash of selfish despotism. On the one hand is presented to us a people, among whom doctrines of a very pure morality, of universal benevolence, of devotion to the public good, are inculcated both by reward and precept; among whom learning is held in such esteem as to be the sure, and, in theory at least, almost the only road to honor and authority; among whom the freedom of the press may be said to have been established a thousand years;(38) among whom outward decency and decorum prevail, and security and order are strictly maintained, not by military authority, but by their own good sense quietly submitting to the rule of the civil magistrate. On the other hand we see this same people, in private, abandoned to gross sensuality, to drunkenness and degrading licentiousness; in public, in affairs of trade and traffic, in the business and diplomacy of the state, making their individual advantage their sole practical rule of right and wrong.
Such being the character of this singular people, our principles would give to them a less strength of the effective desire of accumulation than the generality of European nations, but a greater than that of other Asiatics. This desire is lessened by a propensity to sensual gratifications and selfish feelings, and by a state of society where there is any tiling to endanger the security of future possession. All these produce a tendency to seek the enjoyments of to-day, at the risk of leaving the wants of to-morrow unprovided for. As compared with other than European nations, however, we might expect them to possess no inconsiderable portion of the virtues of prudence and of self-control. The general diffusion of a tincture of learning, and perception of something of the beauty and obligations of moral rectitude, the consequent subjection at all events of the more violent passions, and the great desire to provide for the wants of their families, which the strength of the connexion thus subsisting between parent and child engenders, raise them, in these respects, much above Asiatics in general, We should, therefore, a priori, suppose, that the instruments formed by them must be of orders of quicker return, and embracing a less compass of materials, than those constructed by European nations; but of slower return, and embracing a greater compass of materials, than those to which the strength of the accumulative principle carries the other nations of Asia. All who have written concerning this great empire agree in the statement, that the necessary cost of subsistence is there small, and the wages of labor low. To these two circumstances, determining their state, is to be added a third. The inventive faculty would appear to have been once very active among them; their knowledge of the arts suited to their country is very extended.
Durability is one of the chief qualities, marking a high degree of the effective strength of accumulation. The testimony of travellers ascribes to the instruments formed by the Chinese, a very inferior durability to similar instruments, constructed by Europeans. The houses, we are told, unless of the higher ranks, are in general of unburnt bricks, of clay, or of hurdles plastered with earth; the roofs, of reeds fastened to laths. We can scarcely conceive more unsubstantial, or temporary fabrics.(39) Their partitions are of paper, requiring to be renewed every year.
A similar observation may be made, concerning their implements of husbandry, and other utensils. They are almost entirely of wood, the metals entering but very sparingly into their construction; consequently they soon wear out, and require frequent renewals. A greater degree of strength in the effective desire of accumulation, would cause them to be constructed of materials requiring a greater present expenditure, but being far more durable. From the same cause, much land, that in other countries would be cultivated, lies waste. All travellers take notice of large tracts of land, chiefly swamps, which continue in a state of nature. To bring a swamp into tillage is generally a process, to complete which, requires several years. It must be previously drained, the surface long exposed to the sun, and many operations performed, before it can be made capable of bearing a crop. Though yielding, probably a very considerable return for the labor bestowed on it, that return is not made until a long time has elapsed. The cultivation of such land implies a greater strength of the effective desire of accumulation than exists in the empire.(40)
The produce of the harvest is, as we have remarked, always an instrument of some order or another, it is a provision for future want, and regulated by the same laws as those to which other means of attaining a similar end conform. It is there chiefly flee, of which there are two harvests, the one in June, the other in October. The period then of eight months, between October and June, is that, for which provision is made each year, and the different estimate they make of to-day and this day eight months, will appear in the self-denial they practise now, in order to guard against want then. The amount of this self-denial, would seem to be small. The father Parennin, indeed, asserts, that it is their great deficiency in forethought and frugality in this respect, which is the cause of the scarcities and famines, that frequently occur. "I believe," he says, "that, notwithstanding its great number of inhabitants, China would furnish enough of grain for all, but that there is not sufficient economy observed in its consumption, and that they employ an astonishing quantity of it in the manufacture of the wine of the country, and of raque." As confirmative of his observations he remarks, the number of fires occasioned by the habit of drinking to excess before going to bed, and the prevalence, among the lower orders, of a malady called ye-che, produced by the same vice.(41)
A document given in the Jesuit's Letters, a translation from the Gazette of the empire in 1725, probably shows nearly what order instruments of this sort, and therefore of all sorts, really belong to; that is, the difference between a quantity of rice, or of any thing else, in possession at the end of harvest, and a quantity to be had in spring. It proceeds on the supposition that three bushels at the former period are equivalent, and, in ordinary years, when there is neither famine nor scarcity, will produce four at the latter. By purchasing at the former period, and selling at the latter, the writer therefore estimates, that thirty bushels will, at the end of five years, produce more than one hundred. The estimate is perhaps a little high, but from the nature of it, of the individual from whom it comes, and those to whom it is addressed, it is unreasonable to suppose that it is much too high. Taken in conjunction with a description of a scheme for raising funds, of which an account is subjoined,(42) it indicates that instruments in China are about the order D.
The deficiency of the strength of the effective desire of accumulation, is balanced by the smallness of the necessary cost of subsistence, and wages of labor, and by the great progress which has been made in the knowledge of the arts suited to the nature of the country, and the wants of its inhabitants. Where the returns are quick, where the instruments formed require but little time to bring the events for which they are formed to an issue, even the defective principle of accumulation of the Chinese is able to grasp a very large compass of materials.
The warmth of the climate, the natural fertility of the country, the knowledge which the inhabitants have acquired of the arts of agriculture, and the discovery and gradual adaptation to every soil of a variety of the most useful vegetable productions enable them very speedily to draw from almost any part of the surface, what is there esteemed an equivalent to much more than the labor bestowed in tilling and cropping it. They have commonly double, sometimes, treble harvests. These, when they consist of a grain so productive as rice, the usual crop, can scarce fail to yield to their skill, from almost any portion of soil that can be at once brought into culture, very ample returns. Accordingly there is no spot that labor can immediately bring under cultivation, that is not made to yield to it. Hills, even mountains, are ascended and formed into terraces; and water, in that country the great productive agent, is led to every part by drains, or carried up to it by the ingenious and simple hydraulic machines, which have been in use from time immemorial among this singular people. They effect this the more easily from the soil, even in these situations, being very deep and covered with much vegetable mould. But what yet more than this marks the readiness with which labor is found to form the most difficult materials into instruments, where these instruments soon bring to an issue the events for which they are formed, is the frequent occurrence on many of their lakes and waters of structures resembling the floating gardens of the Peruvians, rafts covered with vegetable soil and cultivated. Labor in this way draws from the materials on which it acts very speedy returns. Nothing can exceed the luxuriance of vegetation, when the quickening powers of a genial sun are ministered to by a rich soil, and abundant moisture. It is otherwise, as we have seen, in cases where the return, though copious, is distant. European travellers are surprised at meeting these little floating farms, by the side of swamps which only require draining to render them tillable. It seems to them strange that labor should not rather be bestowed on the solid earth, where its fruits might endure, than on structures that must decay and perish in a few years. The people they are among think not so much of future years as of the present time. The effective desire of accumulation is of very different strength in the one, from what it is in the other. The views of the European extend to a distant futurity, and he is surprised at the Chinese, condemned, through improvidence and want of sufficient prospective care, to incessant toil, and, as he thinks, insufferable wretchedness. The views of the Chinese are confined to narrower bounds, he is content, as we say, to live from day to day, and has learnt to conceive even a life of toil a blessing. The power which the singular skill and dexterity of this people, notwithstanding their deficiency in the strength of that principle that forms the subject of this chapter, gives them, to work up into instruments supplying a larger circle of wants, many materials that would otherwise lie dormant, is seen in various instances besides those referred to. It may be sufficient to mention the manufacture of silk, and the cultivation and manufacture of tea. They are both instances of the power of the inventive faculty to form instruments, soon bringing to an issue events, that repay, according to the rate at which labor is there repaid, considerably more than the cost of their formation.
However we explain it, it will I think be admitted as a fact, that Europeans in general far exceed Asiatics both in vigor of intellect, and in strength of moral feeling. The average duration of human life is also with them more extended, and property more secure. These circumstances give much superior power to the accumulative principle in the one continent, to what it has in the other, and occasion the instruments constructed in each to be of very different orders, and to form a strong contrast when compared together. The attention of an European, when he visits Asia, is arrested by the slightness and want of strength, solidity, finish, and consequently durability, of every instrument he sees. Were an Asiatic city deserted, the place where it stands would, in half a century be scarcely discernible. The instruments constructed being of the more quickly returning orders, all materials which require much labor, and bring in only distant returns, are neglected. Mud takes the place of stone, wood of iron. In Europe, on the other hand, in proportion as the minds of the people are reflective and intelligent, and their habits moral, we find that the interests of futurity operate on them so largely as to occasion a great capacity to be given to materials, on which, in Asia, a very small capacity would be bestowed, or which would there be altogether neglected. The most stubborn morasses are drained, and converted into arable lands; roads, canals, bridges, fences, dwelling-houses, furniture, tools, utensils, in short all instruments whatever indicate that the farmers of them have regard to a distant futurity, and are willing to give up for its interests a large portion of the means of present enjoyment.
It is to be observed, however, that in Europe invention has in general made much greater progress than in Asia. Perhaps in their knowledge of agriculture and horticulture the Chinese equal most European nations, but in other arts they are far inferior, and, with the exception of them, no Asiatics, in the knowledge of these or of other arts, can compete with Europeans. On the other hand, the wages of labor in Europe, are far higher than in Asia. This circumstance, countervailing the other, would probably, in many cases, bring the durability and efficiency of the instruments constructed in both continents nearly to an equality, were it not for the existing difference in the strength of the accumulative principle.
The examples we have hitherto considered have been of societies, where the principle of accumulation has been either advancing, or, at least, not sensibly retrograding. It may be well to turn our attention to the effects produced by a sensible decrease in its strength. The history of the declining ages of the Roman empire furnishes us with such an one.
Rome may be said to have carried with her, from her earliest germs, the elements of decay. Her power was entirely that of force, a principle suppressing and subduing every thing, generating nothing; like flame spreading far and wide, investing whatever it catches with momentary splendor, but, like it, destroying that which feeds it, and going out at length leaving desolation behind it. The proper trade of the Romans was war. But when in agricultural countries war becomes the occupation of a community, and conquest the means by which it seeks to acquire wealth and greatness, evils arise which time, instead of mitigating, increases. When hunters go to war with hunters, or herdsmen with herdsmen, the object in view, besides overcoming their enemies, is to obtain possession of a portion of the surface of the earth, and the animals wild, or tame, nourished by it. Over such communities therefore, though war, passing like a destroying tempest, leaves ruin behind, yet time obliterates all traces of the devastation produced by it, and the same territory sees a new generation arise from the victors or vanquished, as free, happy, and prosperous, as their forefathers. But in states of society where the riches of the earth are not brought out by the. wild or tame animals which its surface nourishes, but by the husbandman who tills it, there conquest can never be a permanent gain, unless through some permanent right acquired by it over the inhabitants of the territory subdued. Hence the fact of war being successfully pursued as a gainful trade by any community, seems to imply, that the conquered submit to slavery, either personal or political, probably partly to both. Gain was always the ultimate object aimed at by the Romans. It was not to chastise an insult, or to protect their citizens in the undisturbed prosecution of industry, that they fought or conquered. These might occasionally serve for pretexts, and were sometimes perhaps the exciting causes of war, but for the real fruits of victory they always looked to the spoliation of the vanquished, and tribute, in one shape or other, imposed on them. Every people with whom they came in contact was regarded by them first as an enemy to be subdued, after. wards as a province from which they were to be enriched. They were in truth a band of well disciplined robbers, whose virtue, law, religion, centered in their swords; courageous indeed, and keeping to their positive engagements with a fidelity common to brave men, and which, as it is for their interest, even scattered banditti observe, but whose course of rapine was still onward, relentless, merciless, unchecked by thoughts of the corporeal pains, or mental debasement it produced.
Such an empire could only have been formed by overpowering the finer and more generous and elevating feelings, and could not be maintained without having the effect of giving the preponderance to the debasing, selfish, and therefore destructive principles of our nature. It left but one great virtue, that of patriotism, with the Romans a sort of enlarged esprit de corps, and one great moral quality, that of courage, or the meeting danger undauntedly when the interest of the individual or the state required it, -- a principle of action, it may be remarked, differing considerably from the more generous and self-devoting gallantry of the modern. These were strong in Italy while Italy was the governing power; but even they gradually disappeared as the provinces were amalgamated with it, and Italians ceased to be the conquering soldiery.
It were needless to enlarge on a subject so well known as that of the general corruption of Roman manners, from the time of the first Caesar. Venality and licentiousness may be said to have been universal. I shall confine myself to one particular, as marking sufficiently the declension of those principles on which the strength of the effective desire of accumulation mainly depends. I allude to the decay of the family affections, of which evidence every where meets us. The men did not wish to be fathers, scarcely did the women wish to be mothers. The joys of the relation were to them too small, to be a compensation for the sacrifices it demanded. The bringing up children cost the one parent too much money, and took from the other too much pleasure. If families were raised up, it was not from the natural influence of the parental affections, but in obedience to the laws, that the man might have the approbation of the magistrate, and that there might be citizens to the state. They lived, not in others, or for others, but for themselves, and sought their good in enjoyments altogether selfish. It was their aim to expend on their own personal pleasures whatever they possibly could. It would seem as if the majority, could they have foreknown the exact limits of their lives, would have made their fortunes and them terminate together. As they could not do so, the lives of many ended before their fortunes, as the fortunes of others held out beyond their lives. To reap, however, themselves, while alive, all possible benefit from what they might chance to leave others to enjoy after their death, they encouraged some of the members of a despicable class who seem to have constituted no inconsiderable part of Roman society. Parasites ready to minister to every pleasure, and to perform every possible service, waited on the man of wealth, in the hope and expectation of enjoying a portion of it after his death. They were more desirable than children, both because they were able to give something more than mere unsubstantial affection and esteem, and because they were willing to give it, while a son or daughter might imagine they had claims to receive what they could not be said to have labored for. The poets and satirists of the Augustine age, and of subsequent times, give sufficient evidence of the existence of a state, evil in itself, and the forerunner of many evils.(43) It gave occasion to the law compelling parents to leave their children a certain part, a fourth, of their property. Its prevalence may be judged of by the wording of the enactments increasing the children's share. It is stated, as a fact well known, that parents generally either disinherit, or omit their children in their wills, leaving the bulk of their property to distant relations, to strangers, or to slaves, to whom they give freedom; and that thus, if their t:amily is numerous, they, who during the lifetime of their father enjoyed affluence, find that his death leaves them in poverty.(44)
Nothing, surely, can more clearly show the extreme and pervading selfishness of the time, than its becoming necessary for the magistrate to compel the citizens to marry, and also to compel them to leave portions to their children. The existence of such a state of things implied a degree of isolation of feeling and action, so great, as necessarily to produce general weakness and decay. The general selfishness of the principles guiding the conduct of individuals, may be gathered from a prevailing proverb "when I die let the world burn."(45) When such were the maxims ruling society, there could not fill to be a heedless sacrifice of the interests of futurity, an exhaustion of the means or instruments which the forethought of previous generations had employed industry to accumulate, without any correspondent reformation of them. Sallust, in a fragment quoted hy Montesquieu, well describes the men of his day as a race who could neither themselves hold property, nor allow others to retain it.(46) Only such instruments could consequently be formed as were of very quickly returning orders, and, as the vigor of the accumulative principle decayed, the members of each succeeding generation saw a mass of materials fall from their grasp, which had afforded a plentiful supply to the wants of their more provident forefathers.
The means of supporting human life diminished, and the numbers of mankind diminished with them. When vice itself did not sufficiently check the growth of the elements of life, it brought want and famine to its assistance. The history of the Roman world under the Caesars, is a melancholy detail of the gradually decaying funds of the Empire, and the gradually decreasing numbers of its inhabitants. Italy, according to Pliny, and other writers, was in the old times crowded with people, thickly set with cities, and rich in all things ministering to the needs of its inhabitants. In his day, its diminished population depended for their sustenance on the productions of other territories. The change certainly was not owing to any alteration in the materials. "Non fatigata aut effoeta humus," says Columella. The earth would have yielded the same returns, had they who possessed it been willing to expend what was necessary to give it the capacity of yielding them. As the materials were only wrought up to very quickly returning orders, they had necessarily a much smaller capacity, and the annual returns made by them were of consequence much less. Pasture took place of tillage; corn was brought from the provinces; and when the supply failed famine ensued. Even the construction of ships for the transport of this, and other merchandise, would seem to have been an effort to which the accumulative principle was scarcely equal. It was found necessary to encourage it by rewarding those who prosecuted that branch of industry.(47) Sometimes land formerly cultivated was allowed to lie entirely waste, and passed altogether out of the class of instruments. The forest and wilderness gained on the Romans, as they would now, for similar reasons, on an Indian population, were some of these tribes put in possession of the domains, anciently the property of their race, at present yielding abundantly to the provident industry of the whites. Had there been no irruption of the barbarians the Empire must have perished, more slowly perhaps, but as certainly, from the operation alone of these internal causes of decay. They were occasioning a progressive diminution of the capacity which materials formerly possessed. Thus, it is to the Romans themselves as much as to the Barbarians, that the destruction of the public edifices is to be ascribed. The stones were applied to private purposes. With the capacity for yielding a return, there necessarily perished the return yielded, and the power, consequently, of maintaining the same number of men, and contributing an equal amount to the wants of the state. Hence the population of the Empire, and the imperial revenue diminished from age to age.
The diminution would have been much more rapid but for some counteracting causes. Rome, while she conquered and enslaved, gave peace, and peace enabled the arts to pass from country to country, and often, under her protection, carried them to regions before barbarous. Again, she herself, as she gradually proceeded to enslave the rest of the world, and encircle it in her empire, received into her bosom those who laud been free, or were the immediate descendants of freemen, and retained something of their virtues. The ungovernable licentiousness, extravagance, and proneness to evil of the Italians, were tempered by the greater decency and frugality of the new men of many of the distant provinces, who flocked in to recruit the diminishing numbers of her citizens."(48)
These two circumstances, however, only retarded, they could not resist, the advancing degeneracy, poverty, and weakness, that were gradually sapping the foundations of the Empire, and exposing it to be overturned by external violence, or to fall to ruin by its own weight. While some of her provinces gave strength to Rome, she corrupted them; if she gave them her arts, she gave them also her manners. Like liquor, already begun to turn, mixed with what is yet fresh, the defects of the compound were not at first perceptible; by and by, the adulteration diffused through it wrought on the whole, and rendered it all alike worthless.
The propagation of Christianity over the Empire is to be reckoned as another of the causes retarding its decay. It is to be observed, however, that this took place too late for reaping the advantages, which the morality of the Gospel might have otherwise conferred; and that the corruptions of the times were so great as to lead its teachers rather to preach the duty of withdrawing from the world, than to inspire them with the hopes of remoulding the world to an accordance with a system of perfect purity of morals and benevolence of purpose. The effects of this cause were therefore comparatively small.
The reader will perceive that the subject we are upon might be stretched to an indefinite length. Circumstances have given to every community a peculiar character; the moral and intellectual powers of every people have received different degrees of development, and the continuance of life is more or less probable, and the possession of property more or less assured, in one country than in another. All these particulars vary the relations between the present and the future, in the estimation of the members of different societies, and would therefore determine each community to stop short at some particular point in our series, towards which, the strength of the accumulative principle may be said to cause the instruments it forms continually to gravitate. Unlike the operation of gravity however, the force with which they tend to this point diminishes, as their distance from it decreases, and the farther they are removed from it, the greater the rapidity of their progress towards it.
The subject would not therefore be fairly exhausted, until all the circumstances of the moral and intellectual state, and other particulars of the condition of every people, had been examined, and compared with the extent to which the formation of instruments among them is advanced. Enough however, has perhaps been done to show, that this principle is of very extensive operation, and that in our subsequent inquiries we are warranted in assuming the strength of the effective desire of accumulation, to be a circumstance of primary importance in the determination of the extent to which the formation of instruments will be carried in any society. We should now proceed to examine the more important effects resulting from variations in the strength of this principle in different members of the same community. It is however necessary first to consider some phenomena produced by the progress of it, and of the inventive faculty, and certain classifications of instruments and names applied to them, which have thence arisen. This will form the subject of the next chapter.
CHAPTER VIII.
OF THE DIVISION OF EMPLOYMENTS AND OTHER PHENOMENA PRODUCED BY EFFORTS TO ACCELERATE THE EXHAUSTION OF INSTRUMENTS.
Every individual endeavors to exhaust, as speedily as he can, the capacity of the instruments which he possesses. By rapidly exhausting the capacity of any instrument, the returns yielded by it are not lessened, but quickened. The powers it possesses to bestow enjoyment, or to aid in the formation of other instruments, are not diminished in quantity, but sooner brought into action, and it passes to an order of quicker return. When therefore the efforts of individuals, so divided, are successful, by placing the instruments operated on in more quickly returning orders, they stimulate the accumulative principle to give greater capacity to instruments of the sort, and proportionally increase the capacity of the whole stock of instruments owned by the society. It is to certain phenomena, in the production of which these two circumstances are the main agents, that we have in this chapter to direct our attention.
As the knowledge which mankind possess of the course of nature advances, and they discover a greater number of means to provide for their future wants, the instruments they employ for this purpose become very various. The exercise of the arts of the weaver, the blacksmith, the carpenter, the farmer, implies the existence of a great variety of tools with which they may be carried on. But, as a man can only do one thing at once, if any man bad all the tools which these several occupations require, at least three fourths of them would constantly lie idle and useless. It were clearly then better, were any society to exist where each man had all these tools, and alternately carried on each of these occupations, that the members of it should if possible divide them amongst them, each restricting himself to some particular employment. There would then be no superfluous implements, each set of tools would form an instrument ranch more speedily exhausted, arid therefore of an order of quicker return than before. In cases where this could be done, common sense would point out the advantage of it. When, for instance, a man's loom came to be worn out, he would go to his neighbor and say, "I shall not make another loom if you will undertake to do what weaving I may require; in return I will give you some of the produce of my farm, or will do some blacksmith work for you." The offer would be accepted, and similar motives operating throughout the society, each individual in it would confine his industry, as far as possible, to the employment of some particular set of tools or instruments. It is not perhaps likely, that this was the manner in which that division of occupations with which we are now familiar was originally produced, but it must evidently have been produced in this way, had it not been otherwise brought to pass, as we see, in fact, that even now it is thus brought to pass in the progress of settlements in North America. In such situations, every man is at first probably obliged to be his own carpenter, glazier, tanner, cobbler, and perhaps to a certain extent his own blacksmith. As the settlement fills up, and the population becomes sufficiently dense, lie gives up this multifarious industry, and takes to some particular branch. The advantages of the change to the whole community, and therefore to every individual in it, are great. In the first place, the various implements being in constant employment yield a better return for what has been laid out in procuring them; being sooner exhausted they pass to a more quickly returning order. In consequence, their owners can afford to have them of better quality and more complete construction; the effective desire of accumulation carries them on to a class correspondent to its own strength. The result of both events is, that a larger provision is made for the future wants of the whole society.
Such a revolution can only have place, where the individuals exercising the different employments, have a ready communication with each other. In situations where they cannot easily communicate, either from distance, or difficulty of transit, such exchanges cannot take place. If a man had to go twenty miles for every little piece of carpenter work that lie wished executed, it were better for him to keep a few carpenter tools of his own. Neither is it likely to take place extensively unless where the accumulative principle has considerable strength, and where, consequently, a large amount of labor is wrought up in the several implements in use. Where, as in Hindostan, the loom is merely a few sticks, it would save one individual very little to employ another to weave for him. It is accordingly, in countries where the population is most dense, the facility of communication greatest, and instruments wrought up to the more slowly returning orders, that employments are most divided.
As a division of employments implies the existence of exchange or barter, so, as it extends, these exchanges become necessarily more frequent. Every man, to procure the supply of his various wants, has to employ the services of more individuals than he had before. The farmer, who used to manufacture his own cloth from his own fleeces, transfers these to some one else, and perhaps, after they have passed through the hands of the carder, the spinner, the weaver, the fuller, etc. part of them returns to him again in the shape of cloth for some garment that he is in need of. In an advanced state of society, very few wants are supplied but by articles or instruments which have passed through many bands. We can scarce then fitly pursue our subject, without some examination of the manner in which these exchanges take place, and of the rules by which they are regulated.
As all instruments exist solely to supply wants, so any man will consent to receive an instrument in exchange, or expect to give it in exchange, only as it is a means of supplying wants. It is the business of every man to adopt the readiest and easiest means he can devise to supply all coming needs, and it is solely because the medium of barter presents the readiest means of effecting this end, that he adopts it.
But labor is the fund which all men have, out of which to supply their wants. Some have other funds besides, but every man has this, and strip a man of every thing adventitious, this alone remains to him, it is this, then, which a person may most fitly be said to expend, in provision for any future want. When one man exchanges this for that, he may be said to give the labor which he has expended on this, for the labor which has been expended on that, and labor for labor would seem to be the roost simple of exchanges. It never, as we shall see, exactly takes place, but sometimes it is nearly approximated to, and, that we may set out from the most simple elements, we may suppose that it is actually arrived at.
Any man will be inclined to exchange one instrument for another, if, by so doing, he can save himself any part of the labor which he must otherwise expend in producing that other. A lives in some place where willows are to be had for cutting them; he employs himself in making willow baskets, one of which he finishes in two days; B offers him a straw hat for it. If he wants a straw hat, and thinks that, were he to set a making one, it would occupy him more than two days, and moreover, that neither D, E or F, who make straw hats, will give it for less; he will be inclined to make the exchange. In doing so, it is a matter of indifference to him what time B may have expended in making the hat, his only reason for entering into the transaction, is the saving of labor to himself he thereby effects. In reality, however, it is altogether likely that B has not expended more than two days in making it. For, supposing, as in this case we may, that both A and B have the same natural faculties, B, were he to set about making willow baskets, could make them as well and as easily as A, that is at the rate of one in two days. If then the straw hat cost him more than two days labor, he would rather make a willow basket for himself than exchange his straw hat for it. Even if he had not the manual skill necessary, he would apply himself to acquire it, and take to the occupation of basket-making in preference to that of making hats; as we see, in employments where mere labor is concerned, that one is deserted for another according as it gives less or more wages.
It so comes to pass that in the same society, in all exchanges, as far as we can conceive mere labor to be concerned, one man, A, barters that which has cost him two, or twenty days labor, with that which has cost another, B, two, or twenty days labor. We must however bear in mind, that neither does A offer the article, nor does B receive it, simply because it has cost two, or twenty days labor. A offers it, and B receives it, because it is an instrument to supply future wants, and under the supposition that it cannot be got for less than two or twenty days labor. In such cases, the person desirous of making the exchange may indeed say to the individual with whom he wishes to exchange; Sir, I assure you the article cost me two, or twenty days labor, as the case may be; and being assured of this, the person so addressed may think it sufficient grounds to make the exchange, and may so conclude the bargain; but he does so, not because the other has expended two or twenty days' labor on it, but because, be having expended this, be concludes it cannot be got for less. That if it has cost him two or twenty days' work, it would have cost, and would cost himself, or any other, the same labor. If he knows that the person desirous of exchanging is an unskilful or bungling workman, or if he sees that the labor has been injudiciously applied, he will not give what is demanded. He knows, in that case, that he can make it, er get it made, for less. Were one to employ himself in rolling a stone up hill and down hill for a month together, he would leave it as useless to him in the way of exchange as before he put his hand to it.
It may be laid down as a rule, then, that in as Far as labor simply is concerned in all exchanges, one thing will be bartered for another, not in proportion to the labor that has been respectively bestowed on each, but in proportion to that which it is necessary to bestow on materials, similar to those of which each has been constructed, to make other articles equal to them in capacity to supply wants. That, if this basket exchanges for that hat, though each may have cost two days' labor, it is not exactly because each has cost it, but because neither a basket equally good as the one, nor a hat equally good as the other, can be made for less than two days' labor.
As a corollary from this, it follows that, whenever an article comes to be made with less labor than formerly, articles of the same sort which may have been previously manufactured, procure for their owners less of other articles in exchange than they did before. They exchange, not for what labor has been actually wrought up in them, but for what is now required to make others similar to them. Thus, supposing that a basket-maker, say in some settlement in North America, having to go on foot a considerable distance through woods and swamps for his willow twigs, requires one day to procure enough to make a basket, and that he takes another to work them up, he would then probably receive for each basket two days' labor, or articles having cost two days' labor. If now, however, a place where equally good willows grow is discovered near at hand, so that only half a day is required to get enough for a basket, and if this is generally known, he will no longer be able to exchange them at the same rate, because, as we have seen, other people would make baskets for less, that is, for one and a half days' labor, or for articles in the fabrication of which the labor of one and a half days bad been expended. Any stock then he might have on hand of baskets made previously to this discovery, would only exchange for articles requiring for their fabrication the labor of a day and a half. The same rule that applies to this trivial instance, holds good in affairs of greater importance, and regulates a large amount of exchanges.
It can however never exactly happen, that labor will be exchanged, in this simple way, for labor. The formation of every instrument, besides labor, requires also the assistance of some other instrument. Even the basket-maker and the hat-maker, allowing them to get the twigs and straw they require, for the trouble of collecting them, would need, the one at least a knife, and the other a needle and thread. Auxiliaries so inconsiderable as these need scarce be noticed in the reckoning; but there are eases where these assisting instruments may be said to do a great part, others, in which they may be said to do nearly the whole of the work. In a steam-boat the engine may be considered as the great laboring power, though the services of the men who supply fuel, and regulate the motion of it and of the boat, enter also largely into the account. In a set of well-contrived, and well-finished pipes, for conducting water through a city to the different houses in it, the amount of human labor entering into the process is very trifling.
A weaver we shall suppose receives thread to weave into a piece of linen, and finishes the job in thirty days. Were he now in return, to receive from his employer simply thirty days' labor, he would get too little. For, his loom being an instrument partially exhausted in fabricating the linen, this exhaustion ought to form an item in the account. Suppose that the effective desire of accumulation of the individual, is of strength sufficient to carry him to the order G, doubling in seven years, that the loom cost one hundred days' labor, and that it will be exhausted in seven years; it would then require to return two hundred days' labor, or an equivalent, at the end of that period. The return however is not delayed so long, bat begins to come in daily, immediately after its construction. Calculating then what yearly return is equal to two hundred days at the end of seven years, in the estimation of a man who reckons one day now equal to two then, it will turn out to be nearly twenty days. We may allow that the loom is in employment three hundred days a year, it would therefore, on these principles, have to return two days labor, for every thirty days during which it was in operation, and the weaver would consequently have to receive an equivalent to thirty-two days' labor; at least had he not a moral certainty of receiving this, he would not have formed the instrument, and were such return to cease he would not reconstruct it.
The transport of goods, by sea is an event brought about as much by the agency of instruments, as by direct human labor. A vessel costs, we shall say, five thousand days' labor, and is exhausted in seven years, she is navigated by three men. If she belongs to a person whose effective desire of accumulation carries him only to the class G, and supposing they who navigate her to be paid for three hundred days' labor, she must, on these principles, return about nineteen hundred days' labor annually. Say she is freighted to carry a cargo of timber, and that the voyage occupies three months. This transport is a. part of the process of the formation of certain instruments, houses, furniture, etc. as necessary as any other part of it, the owner will therefore receive directly, or indirectly, from those engaged in their formation, an equivalent to not less than four hundred and seventy-five days' labor.
It is to be observed, too, that, even in cases where labor alone seems to be paid for, time generally also forms one of the items to be taken into account. Thus, an individual contracts, within three months, to fell the trees on a certain piece of forest land in a North American settlement. If then he be paid at the commencement of the three months, he will expect to receive less than if payment be deferred until the expiration of that time, and the difference between the two amounts will be regulated, as in other cases, by the particular orders to which instruments, in that particular situation, are generally wrought up. The same things hold good in all instances where labor is paid for by the work executed, or, as it is termed, by the piece.
The division of employments and consequent prevalence of the system of exchange, occasions a particular classification of instruments.
Before the division of employments takes place, the instruments which every man forms, or causes to be formed, are for his immediate use, and after it has taken place, the portion individuals reserve for this purpose makes still a considerable part of the whole instruments belonging to any community. Even the poorest beggar has some clothes to cover him; the opulent have houses, furniture, clothing, gardens, pleasure-grounds, tie. This part of the whole instruments possessed by individuals or communities is termed a stock reserved for immediate consumption.
The remainder of the general stock of instruments of individuals and of societies, with the exception of land, considered not as actually cultivated, but as having a capacity for being cultivated, is termed capital. The instruments to which this term applies supply the future wants of the individuals owning them, indirectly, either from being themselves commodities that may be exchanged for articles directly suited to their needs, or by their capacity of producing commodities which may be so exchanged.
Capital itself is again subdivided into fixed, and circulating capital. Fixed capital consists of instruments which have a capacity for producing commodities to be exchanged, but are not themselves formed for the purpose of being exchanged. Circulating capital consists of commodities fitted for being exchanged, or of instruments in process of formation into such commodities.
It often happens that the division between fixed and circulating capital is drawn with difficulty, some instruments belonging partly to the one, and partly to the other. Thus a horse employed for agricultural purposes is a part of fixed capital, while an ox may belong partly to fixed, and partly to circulating capital, as he is reared and fed, in part for the services expected from him as an animal of draft, and in part for the price his carcase brings.
The whole instruments owned by an individual, or a society, and comprehended under the terms a stock reserved for immediate consumption, fixed and circulating capital, have received the general appellation of stock.
All instruments, whether comprehended under the divisions capital fixed and circulating, or a stock reserved for immediate consumption, possess a capacity for supplying the wants, or saving the labor of man. But the wants which they supply, and the labor which they save, are in general not immediate, but future. Now we cannot estimate the same amount of labor saved, or wants supplied tomorrow, and five, or fifty years hence, as equivalent, the one to the other. Thus if we compare together a hundred full grown trees, and as many saplings, it may be, that, estimated in the supply they yield the wants of futurity, they are alike. If the former be cut down tomorrow they may yield a hundred cords fire wood, and if the latter be cut down fifty years hence they may yield the same. We should not nevertheless conceive, that they were equal the one to the other. What measure then are we to adopt for comparing them and other such instruments together, and thus finding an expression in a quantity of immediate labor for the whole capacity of instruments possessed by any community or for the whole stock of that community? The natural measure would seem to be the relative estimate, which the individuals concerned themselves form of the present and the future, that is, the strength of the effective desire of accumulation of the particular community. Thus in a community whose effective desire of accumulation is of strength sufficient to carry it to the formation of instruments of the order E, doubling in five years, an instrument, which at the expiration of five years yielded a return equivalent to two days' labor, might fairly be estimated as equivalent to one day's present labor; if at the expiration of ten years it yielded an equivalent to four days' labor, it might also now be rated at one day's labor, and so for other periods. This therefore is a mode of expressing in present days' labor the whole capacity of the instruments owned by any society which will be made use of in the following pages; and the terms, the absolute stock, and absolute capital of that society, will be employed to denote it.
The mode however in which the fixed and circulating capital and stock belonging to societies, is usually estimated, is different. It is usual to estimate the instruments belonging to any society, by comparing them with one another a~ they actually exchange, some particular commodity being made choice of as the standard to which all other instruments are referred. To capital and stock estimated in this mode, the terms, the relative capital and stock of societies, will be applied.
In cases where the effective desire of accumulation of a community has had opportunity to work up the materials possessed by it into instruments of an order correspondent to its own strength, the absolute and relative stock must, it is obvious, agree; but, in cases where the accumulative principle has not yet had time fully to operate, the former will exceed the latter. Thus, were we to suppose the returns made by the whole instruments belonging to a society, or their total capacity, to be suddenly doubled, without any addition to the labor employed in forming them, the total absolute stock of the society would also be doubled, while its relative stock would remain unaltered. The relations of the several instruments possessed by it remaining the same, whatever commodity had been adopted as the standard, when applied to measure the others it would give the same results as before. It never, indeed, can happen that any increase to the capacity of the instruments forming the stock et' a society, so great and sudden as we have supposed, can take place; but however small such increase, it would have a real effect, and would occasion a difference in the amount of the whole stock as estimated in the one or the other manner. Every such increase is effected through the operation of the inventive faculty, and we shall therefore refer the consideration of the effects flowing from it, until we come to treat of the phenomena resulting from the progress of that faculty.
Though the division of employments consequent to the progress of science and art, and the operation of the accumulative principle, on the whole greatly accelerates the exhaustion of instruments, there are yet some particulars in which it tends somewhat to retard that exhaustion. In the most simple state of society, when art is so rude, and accumulation so little advanced, that each individual forms almost all the instruments he himself or his family exhaust, and when, consequently, the general stock of the community is nearly altogether a stock formed and reserved for immediate consumption, it can seldom happen that there will be either an over abundance, or a deficiency of instruments of any sort. As each individual can make an accurate estimate of his own wants and those of his t:amily, prudent men, in such a state of things, provide only the instruments that may be of use to them, and do not form any but such as they foresee will come into employment as they are formed. But when individuals ceasing to form only instruments directly supplying their own wants, give the greater part of the industry they can command to manufacturing commodities for the purpose of exchange, as they have not the means of calculating with equal accuracy the wants of other men, it occasionally happens that some commodities are produced in excess, and that there is a deficiency of others.
When again the state of society is such, that each individual forms almost the whole instruments he requires, there is very little transport of commodities from place to place. The amount of transport necessarily increases with the separation of employments. This forms another drawback from the advantages arising from the extension of the division of occupations, and system of exchange. On account therefore both of many commodities being produced in excess, and of its being necessary to transport most from place to place, there are always, in such states of society; very many commodities lying idle, being neither under process of formation or exhaustion, but collected in masses at different points, waiting till some vacancy be found for them. The longer they continue in this state the farther they must pass towards the orders of slower return, and the more the operation of the accumulative principle must be retarded.
It seems to be chiefly from the desire of obviating somewhat these two disadvantages attending the general advance of art and industry, that, when the nature of the occupation permits it, individuals engaged in all the different divisions of industry place themselves as near each other as possible, and form villages and towns. Each can thus more easily adjust the amount of commodities he produces to the wants of other men, and thus also there arises a great saving of transport.
It is also in a great measure owing to the necessity of transporting commodities from place to place, and to the difficulty of regulating the precise amount produced consequent on the division of occupations, that there arises an order of men, that of merchants, devoting themselves solely to the business of transport and exchange. Merchants are the great exchangers of society, regulating the production of commodities, and collecting and distributing them to situations where the never-ceasing processes of formation and exhaustion are producing vacancies for them. It is their business to make these exchanges with the greatest possible rapidity, and least possible expense.
There is a general average time elapsing from the period of the formation of every commodity, until it pass from the individual having formed it, to the individuals who exhaust it in the supply of their wants, or employ it in the formation of other instruments. The merchant who effects the transfer of commodities between the other members of society is entitled to receive an amount exceeding that which he gave, by the return which the labor embodied in the commodity exchanged should yield for this average time, according to the general rate of return of capital in the community. If therefore the superior intelligence, penetration, and activity of any merchant, giving him the power of foreseeing with greater accuracy than his brethren where vacancies are about to exist, and what will be their extent, and of discovering where the commodities proper to fill them up may most readily be found, and most easily transported to the requisite places, enables him to effect these transfers with greater facility than usual, and within less than the average time, he will receive a proportionally greater return than other merchants. On the contrary, if, from a deficiency in these qualities, any merchant attempt the transfer of commodities for which there is no vacancy, or effect the transfer of commodities for which there is a vacancy, at more than the average expense, or in more than the average time, the returns his capital yields him will be less than those usually received by the other members of the community. Mercantile energy is thus stimulated to effect all practicable exchanges with the greatest possible celerity, and at the least possible expense. The activity which is in consequence given to the process of exchange, is a circumstance exceedingly beneficial to the interests of the community. By lessening the distance between the periods of formation and exhaustion, and diminishing the expense of formation, for transport makes a part of that expense, the successful exertions of the mercantile portion of society have a powerful tendency to preserve instruments in the more quickly returning orders, and to excite the action of the accumulative principle. Our subject consequently requires us to examine somewhat more particularly the mechanism by which the business of merchants is conducted, and the mode of calculation by which it is practically regulated. Our attention too is more especially called to these, because it is from the former that the principles of the present science of political economy are derived, and on the latter that its nomenclature is founded.
The foundation of the mechanism of mercantile transactions is
Money.
Gold and silver, or, as they are called, the precious metals, are more properly entitled to the appellation of money than any other thing is, because they more generally pass for money than does any thing else. Their beauty, their incorruptibility, and some other of their qualities afterwards to be considered, have, in almost every country, rendered them the means of affording much enjoyment, that is, of supplying, to a large extent, certain of the wants of man. It seems likely that these qualities, joined to the facility with which they may be transported from place to place, first made them esteemed the most desirable of all commodities that one could possess. In the very frequent revolutions and commotions that occur in the earlier ages of society, articles that do not decay, can be hid, or carried off without difficulty, and are always estimable, would naturally of all others be most coveted. They thus probably were first chiefly sought after, for the purpose of being retained, not for that of being exchanged; even yet in many countries, partly from old habits, and partly from still prevailing insecurity, they are chiefly prized as of all things, those best fit to be hoarded. But, in whatever manner their use may have been introduced, or how much soever in some countries it may be dependent on a feeling of insecurity, at present or formerly prevailing, and prompting their possessors to keep not to part with them, they are now more generally sought for, for the purpose of being immediately passed away, forming, in the shape of money, the great medium of exchange, and it is solely in the part they thus act, that we have here very briefly to consider them.
When, in the progress of society, men divide into different occupations, and each ceasing to fabricate himself all the instruments his wants require, barters the instruments or commodities he forms for those formed by others, the system of exchange, as we have seen, commences. The introduction, to a greater or less extent, of some sort of money, seems naturally to follow. For when a man forms only one sort of instruments or commodities, it cannot at all times happen that he can exchange them with articles fabricated by other men, and necessary to supply his wants, because these other men, the farmers and possessors of what he desires, may not at the moment have occasion for what he has formed. "The butcher has more meat in his shop than he himself can consume, and the brewer and the baker would each of them be willing to purchase a part of it. But they have nothing to offer in exchange, except the particular productions of their respective trades, and the butcher is already provided with all the bread and beer which he has immediate occasion for."(49) There are two modes by which the desired exchange may be effected. If the brewer and the baker have a commodity received by every one for all others, such as money is, they may each give the butcher a certain quantity of it for a quantity of meat, and when he requires their ale and bread, he may, in turn, send back to them also a quantity of money. Or, the butcher may be satisfied with the promise of the brewer and the baker, that, at some future time, when he has occasion for it, they will give him a quantity of ale and bread, or of something else. These two modes of effecting the object form the two systems of cash, or credit, by which all the business of every country that consists not in barter, is carried on.
Pieces of gold and silver coined, that is stamped with a mark regulating and assuring by the authority of the magistrate the weight and fineness of each, enter largely into transactions of the former order; they make the bulk of the current coin of most countries. Supposing the whole of the exchanges of any country that are not simple barter, effected by money, and that gold and silver form the sole money, then the amount of them so employed would seem to be regulated by two circumstances.
1st. By the quantity of commodities that may exist to be exchanged. This again must depend on the quantity of materials wrought up into instruments, and on the progress of the division of labor. As the number of instruments increase, and as from their first commencing formation, until they are exhausted, they pass through more hands, the amount of exchanges must increase. As the number of instruments formed decreases, and as every man himself constructs a greater proportion of those necessary to supply his own wants, the amount of exchanges must diminish, and as the amount of exchanges increases, or diminishes, so must there be required a greater or less quantity of the medium through which they are transacted.
In such a state of things as we suppose, could every man see exactly beforehand the whole series of the exchanges that would present themselves to him, every prudent man would so manage his exchanges, his purchases that is, and his sales, as to provide himself with the exact amount of money necessary to effect ever] exchange that he might deem it advisable to execute. But no man can with accuracy foresee what transactions may present themselves to him, or when they may do so. The amount of possible future exchanges that may offer to any man, and the time they may occur, are exceedingly uncertain, depending on many things not to be foreknown, the operations of other individuals engaged in the formation of instruments, immediately, or remotely connected with those on which his means or industry is engaged, the course of the winds and seasons, the fortune of war, the progress of treaties, and numberless other events equally doubtful in their issues. Every man, therefore, would in such a state of things, suffer two inconveniences, he would occasionally have too much money, and occasionally too little. He would sometimes have a sum lying for a long time useless by him, and an advantageous purchase would sometimes present itself to him which he had not cash sufficient to effect. Between these two opposite evils, it would be his business to steer as safe a course as possible; he could not hope altogether to avoid them, but must be content to suffer occasionally from both. Which of the two it would be most prudent for him to run the risk of suffering from, would, I conceive, depend on another circumstance, forming the second of those that, under the suppositions we have made, regulate the amount of precious metals in circulation.
Every man must be more unwilling to run the risk of having a sum of money lying useless by him, by how much greater the amount of the returns he could have by turning it to the formation of instruments. If then, in the society of which any man is a member, instruments are not far removed from the first orders of our series, when they soonest double the expenditure of their formation, he will rather risk the inconvenience of having too little money by him, than the loss of having a sum in his coffers long unemployed, which might have been converted into instruments yielding large returns. But if, in the society of which he is a member, instruments are far removed from the first orders of our series, he will be disposed to reserve a greater amount in the hopes of making more by some advantageous bargain, than he could by expending it on the formation of any instrument. We should expect then to find, that, in countries where either the principle of accumulation is too weak to carry instruments on to the more slowly returning orders, or where it has not yet had time to do so, money would be scarce, and that, where this principle having had time to act, its strength has carried them to the farther orders, there money would be plenty. Such will be found to be the fact. In China, gold and silver are rarely seen, in the interior traffic of the country; in Holland, they have always abounded. In new settlements in America, where from the superabundance of materials, instruments are of very quickly returning orders, the amount of coin to be found is exceedingly small. When a man there has cash in his pocket, he finds so many things that he could with profit expend it on, that tie can scarcely refrain from doing so.
An European visiting some parts of Upper Canada, is surprised, when he comes to discover, that a few dollars is all the cash that even men comparatively rich may have lying by them. He is apt to conceive that they are poor men, and to describe the country as a poor country. In doing so, however, he does not make a correct use of words. He sees, for instance, a man who, ten years before, may have brought a sum of two hundred pounds to the place where he is now settled, without at present twenty dollars in his pocket, and who perhaps, were that sum suddenly demanded of him, might have difficulty to procure it. In one sense, then, the man is poor. But, were this man asked to sell his farm and his other property, he probably would not give it for less than a thousand pounds, and he might get this sum for it. If so, it is ten to one that he would lay out the greater part of it in the purchase of a larger quantity of land than he before possessed, and the remainder in improving that land, so that a year or two would see him just as bare of cash as before, and twelve years afterwards, if he went on prosperously, he would still have but a trifle of ready cash, though perhaps he might truly consider his property worth two or three thousand pounds, and might not be disposed to take less for it. He could hardly therefore be called a poor man. In this part of America, as formerly over the whole of it, "the scarcity of gold and silver money is not the effect of the poverty of that country, or of the inability of the people there to purchase those metals. The scarcity of these metals is the effect of choice and not of necessity. It is convenient for the Americans, who can always employ with profit, in the improvement of their lands, a greater stock than they can easily get, to save as much as possible the expense of so costly an instrument as gold and silver; and rather to employ that part of their surplus produce which would be necessary for purchasing those metals, in purchasing the instruments of trade, the materials of clothing, several parts of household furniture, and the iron work necessary for building and extending their settlements, in purchasing, not dead stock, but active and productive stock."(50)
But, though the loss of having more idle cash lying by one, than can possibly be dispensed with, must be felt most sensibly where such cash can be most profitably expended, where instruments, that is, are not far from the first orders of our series, still it must always be felt. A man will never keep two hundred pounds in his chest, if he thinks it probable that one hundred will be sufficient, because he can always make something of the other hundred. Although however, men, in such cases, must be governed by what they think probably will happen, yet, as no man can foresee with certainty what may happen, every man will now and then be wrong in his calculations, and therefore, under the suppositions we have made, every man would occasionally suffer from having too little cash, as well as at other times from having too much.
The effect of both these sorts of losses must be, to place the instruments on which they operate in orders of slower return, than they would otherwise occupy. One wishes to purchase a pair of young horses of a particular sort; for this purpose he reserves a quantity of coin equivalent to four hundred days' labor; he happens, however, not to meet with a pair that suits him for the space of six months, when he purchases two, giving for them the amount he had anticipated. It is evident, in this case, that they have really cost him, not only the four hundred days' labor, but all that in the country in which he lives, that labor would have produced, besides paying for itself, during the six months he was looking out for the bargain. Now, as this additional outlay cannot add to the capacity of these instruments, to the strength, swiftness, beauty, and health, that is, of the animals, nor diminish their age, it must be esteemed as lessening the proportion between the return to be got from them, and the outlay expended on them, and must move them proportionally towards the orders of slower return. Again, it may. have been that the person who at last sold the horses, may have been desirous of selling them for six months before he effected the sale, and that at the commencement of that period he may have met with an individual who would have purchased them, but not having anticipated the occurrence of so t:avorable an offer, happened not then to have the necessary cash. If we suppose them to have been merely useless to their owner during the period from thence elapsed, the service they rendered him being just sufficient to pay for their food and keep, still, this retardation in the return from the outlay in the formation of them as an instrument, also moves them so much towards the more slowly returning orders, and diminishes the activity of the accumulative principle. If the individual who raised them does not receive an additional price, proportionate to the delay, the occurrence will have a tendency to make him give up this branch of business.
Similar events taking place in the exchange of other instruments, would produce similar results, and therefore two evils would necessarily accompany the state of affairs we have supposed. There would be two drawbacks on the progress of the industry of the society, the one consisting in the expense of the circulating medium, the other in the loss arising from a deficiency in it. The two together would be in proportion to the amount of exchanges which the progress of knowledge, the strength of the principle of accumulation, and the quality of the materials within reach of the society caused to be transacted. The evil directly arising from them would be the consequent retardation of the returns from the industry of the society, an evil equivalent to a proportional diminution of these, and placing them in more slowly returning orders. The evil indirectly arising from them would be the keeping a greater or less extent of materials, without reach of the strength of the accumulative principle of the society, and the consequent nonformation, to a greater or less extent, of instruments that would otherwise have been formed.
The proportion between the two would be determined by the order to which the strength of the effective desire of accumulation, and the time which it had had to operate, had carried the formation of instruments.
But the state of things we have supposed never exists. It scarcely happens, even to return to the sort of transactions we set out from, that a butcher, a brewer, a baker, dealing together, effect all their business either by direct barter, or by cash. The butcher would, in very many cases, be satisfied with the implied promise of the brewer and the baker, that, at some future time, they will give him a quantity of the commodities they respectively deal in, or of money, or some equivalent to it, equal to the price of the beef each received.
This mode of effecting the object, constitutes the system of credit, the second of the two systems by which exchanges are carried on. It has an existence in every country, and in most civilized countries, as is well known, the great bulk of transactions are carried on by the aid of it. Were the actual or implied promise, which the party receiving the commodity makes to him giving it, always fulfilled, it would in itself be unattended with any loss, and might possibly be so managed as-almost entirely to supersede the use of coined money as a medium of exchange.
The amount of the whole purchases made by any individual within a limited time, is, in general, about equal to the sales he effects within the same time. If, therefore, in any community, all the exchanges, which are not direct barter, were to be transacted by credit, and were the obligations to pay granted by all persons engaged in business in it to expire at the same time, when that time came round, every individual would hold obligations to receive, to about as large an amount as he had granted to pay. If then each individual had granted obligations to pay, to the same persons as he had received others from, the business would be at once concluded by a reciprocal delivery of obligations. But this can scarcely ever happen; almost all the obligations to receive payment, which any individual holds, will be from other persons than those to whom he himself has granted obligations. The affair might however be managed, and the same end arrived at, by a transfer of obligations from hand to hand. A has bound himself to pay B fifty pounds, B to pay C fifty pounds, and C to pay A fifty pounds. If, then, A pay B, by giving him C's obligation, B can discharge his debt to C with it, and thus the debts and credits of the whole three be settled. By operations more complicated, but conducted on similar principles, nearly the whole system of exchanges of any community might be managed.
There are two obstacles to this mode of effecting exchanges by credit. The first arising from its inherent complexedness and difficulty, the second from the liability of the contracting parties to fail in fulfilling their engagements, from dishonesty, miscalculation, and accidents impossible to be foreseen. These restrict its application in general to transactions for large amounts, little doubtful in themselves, and which from their nature can be easily systematized and arranged. Such appears to have been the viremens, or transfers, at Lyon.(51) Such also are the transfers effected by the London bankers. In Russia, however, it would seem to be applied to transactions much more various, and complicated. Mr. Storch informs us that the creditors and debtors of the province of Kief, and several others adjoining, the proprietors, capitalists, merchants, those who want funds, and those who want to dispose of them, meet in the month of January, in the town of Kief, to make such transfers, and that in 1804, the amount of their exchanges was upwards of twenty millions of rubles, or about three millions seven hundred thousand pounds sterling. Transfers similar to these are made, he adds, at Reval, and many other towns in the empire.(52)
There is another method by which the system of credits might be conducted, and which may be illustrated by an example taken from a country already referred to, where the causes exciting to its introduction, and giving prevalence to it, operate very powerfully. In many parts of North America, but more especially in new settlements in Upper Canada, the scarcity of cash, and perhaps other circumstances, often lead traders to adopt a peculiar plan of business. Every dealer provides himself with a general assortment of all sorts of commodities in demand in the settlement he inhabits, and reckons on being paid for them in the shape of grain, potash, pork, beef, and other commodities, in the formation of which his customers are engaged. But in this sort of barter, one article will generally fall short or exceed the value of the other, a pound of tea will not exchange for a hog, nor a quarter of wheat for a dozen pounds of sugar. To obviate the difficulty, the merchant opens an account with each of his customers, charging him with the goods furnished, and giving him credit for the produce received, and in titis way perhaps all the transactions between the two are managed, either by barter or credit, without the assistance of a dollar of cash. Nor is this all, a great variety of other transactions are also effected, through his intervention. Any person who may have furnished him with an overplus of produce, or who bus credit with him, can through his means settle most accounts or balances due on accounts. He may thus pay the laborers, and the artificers, and tradesmen, he may employ, by an order on the shop, or as it is called, store, of the country dealer. Besides these, the transactions of the storekeeper extend to the giving out of the raw produce of the country, to individuals in the settlement, tradesmen, etc. who may not themselves have enough, and to the receipt in return of various articles, such as axes, shoes, boots, made-up clothes; and in this way through his books, a very large portion of the business of the settlement is transacted. It is not difficult to conceive, that the whole might be so transacted.
Were the country dealer always to have a supply of every article in demand in the settlement, at a reasonable rate, and were all contracts for the delivery of produce to him to be regularly executed, almost all the requisite exchanges might be conveniently effected through his books. But in this sort of traffic, as the merchant always has commodities to sell, and his customers have not always produce to return, it inevitably happens that they get into his debt. As his object is to sell as many goods as possible, he is very apt to allow many to run in his debt, who do not fulfil their engagements. He suffers from the dishonesty, or the imprudence and miscalculations of those who deal with him. Very many of his customers are much longer of paying him than they have promised, or they do not pay at all. Aware of the risk be runs, he is obliged to balance it by charging an additional sum, over and above what he would otherwise demand, on all commodities that pass through his hands. In some cases, this advance amounts to at least 30 per cent. In this way he makes, or endeavors to make, the prudent and honest persons who deal with him, pay for the imprudent and dishonest, who also deal with him. The former class, in consequence, keep out of the circle of all such transactions, as much as possible, and store-pay, as it is called, is depreciated.
The business of banking, seems to owe its foundation and extension, to its capacity for giving room for the development of the benefits, and for restraining and remedying the evils of the system of credit. The operations which the banker executes in a great society, have more than the advantages of those performed by the system of viremens in France, or Russia, and by the petty store-keeper in a remote American settlement, and avoid many of the inconveniences of both. He is the instrument, through which the mass of the exchanges, taking place in the community, is performed. It is his business to furnish the means of transacting all exchanges that the condition of the society requires, and it is the business of all individuals having many such exchanges to effect, to make application to him for the means of transacting them.
In a great society, a person extensively engaged in business, may, in a short time, have transactions with twenty, thirty, or a hundred individuals; his circumstances can be known but to a few of them, nor is it possible for him to produce to each satisfactory evidence of his own capacity to discharge his engagements, or to give him the security of others for their performance, and even could be do this, it would be insufficient for the pup poses of the greater part of them. If such a person, however, really possessed funds in trade and manufacture, if he really owned a stock of instruments requiring a constant change and transfer with those in the hands of others, he might find means to satisfy one individual, the banker, of his capacity to execute these exchanges in reasonable time, or procure others to be responsible for his doing it. It is then the business of the banker to give him the means of doing so, and he accordingly lends him money when he requires to add to his stock of instruments, that is to buy, and receives money from him again, when he transfers instruments to others, that is, when he effects sales. Every person engaged in business doing the same, the banker is the general lender, and receiver of the society.
The mechanism of banking is managed in two ways. The one is by discounting bills, that is by giving money immediately, for the obligations by which one man contracts to pay money to another, at some future time, deducting a part, the proportion of which is determined by the order in which instruments stand in the society, and by the length of the period. This method is analogous to that of viremens, but far preferable. Thus, an individual who holds an obligation by which another binds himself to pay him the sum of two thousand pounds in six months, were he in some parts of Russia, would be justifiable, were he confident of the solvency of his debtor, to contract obligations to that amount, and payable at the same time. Were he then desirous of having something transferred to him, of the value of two thousand pounds, his granting an obligation to that amount, and payable at six months, might help to make the two transactions of easy arrangement. But, supposing that he were desirous of having a number of small transfers made to him, that he were to grant a proportional number of obligations, that the persons to whom he granted them were again to grant others, still smaller and more numerous, and that these were again to be subdivided and reunited, it is evident that the mass of affairs, would become so complicated, and the number of individuals concerned in them so large, that the trouble of arranging them would be excessive. This system is of consequence, as has been already observed, of limited application. But when an individual gets a bill discounted, the transfers he effects with the bank bills he receives, occasion no future trouble to himself or others.
The system of bank credits is the second mode, in which the business of banking is managed. It is somewhat analogous to that carried on, through the aid of the books of the North American store-keeper. The banker gives the means of effecting any purchases which those dealing with him are desirous of making, and, when they sell, gives them immediate credit for the amount they receive. He is not, however, like the store-keeper, urged on, by the dread of a stock of goods lying on his hands too long, to allow people to run accounts with him, whose credit is in any means doubtful. He is a dealer simply in credit, and it is his business, before giving credit, to demand such security as may satisfy him that he can sustain no loss, and this being granted, to afford the requisite accommodation on reasonable terms.
The advantages which the banker derives flora being the general lender of the community, arise chiefly, from the peculiar sort of money he lends. It is not specie, but merely an obligation to pay in specie. But as all who engage in business have to return cash to him, it is equally good to them as specie, and through them is equally well received among the other members of the community. Thus the money of the banker comes to make a great part, or nearly the whole, of the circulating medium.
The benefits which the society receives from the system, when there are no defects in the conduct of it, seem to be threefold.
1st. As far as it extends, the expense of the circulating medium, the expense which men in business must otherwise be put to by being obliged to have a quantity of cash always lying by them to meet sudden emergencies, is done away with. When a man wants cash, he goes to the bank for it, when he has cash, he carries it to the bank. Money never lies idle.
2d. It does away with all deficiency in the circulating medium. When the system of instruments which belong to an individual is defective in any part, he can at once supply the defect, and when it is redundant, he has no difficulty in disposing of the superfluity where it may be usefully employed.
3d. It does both, without the evils otherwise attendant, on the substitution of credit for coin. The dealings of men of prudence and character, are not so mixed up with those of improvident and suspicious persons, as to make the one bear the burden of the losses sustained through the folly or dishonesty of the other. Every instrument, as its formation is pushed on by the industry of the members of the society, is moved directly to its proper station. It neither runs the risk of being subjected to remain useless, owing to the expense of moving it, nor of being misplaced or destroyed in the process of moving it.
The tendency of these three effects, flowing from the banking system properly conducted, is to carry the instruments subject to the operation of exchange, to orders of more quick return, than they would otherwise have occupied. The outlay expended on them is not so great, and they sooner make the expected returns. The accumulative principle receives in consequence, a stimulus, that enables it to embrace a larger compass of instruments, and the general stock of the society is soon proportionally increased. Greater facility is also given to the division of employments, from there being no obstruction to the additional exchanges required, and new branches of business arise. From both these circumstances, the number and amount of exchanges increase.
The money of the banker, compared with gold and silver, as a medium of exchange, would thus seem to be not only less expensive, but more efficient. When the circulating medium in any country is specie, probably far the larger portion of it lies idle. Every merchant, in such a country, has a quantity of gold or silver, proportioned in amount to the business he carries on, doing actually nothing, but only waiting to do whatever may offer. The strong boxes of all the merchants in the country, always hold, therefore, a large portion of its capital in inactivity. In a country, on the other hand, where the bills of the banker form the circulating medium, the quantity of money lying for any time idle is insignificant. No money is retained, but for a specific purpose. In Scotland, for example, every merchant places in the hands of the banker, all the cash for which he has not immediate use.
Were we, therefore, to confine the advantages derived from the institution of banks, in any community, to the substitution of a cheap medium, for a dear one, we should make an imperfect estimate of them. If, for instance, the circulating medium in any country be one million in coin, and if that be superseded by paper, should the quantity of paper in circulation be found to amount also, to one million, it would indicate a great increase in the transfers effected, and would show, either that a larger compass of materials had been brought within reach of the accumulative principle, or that employments had been more subdivided, or that both these circumstances had occurred.
From the same causes, the effects of a recurrence to a metallic currency, and the compulsory substitution of one million of specie, for one of paper, would be far from being limited to the expense of the bullion employed in the operation. It would, besides this, render impracticable a multitude of transfers, that might otherwise have taken place, disorganize the whole system of exchange, place the stock of the society in orders of slower return, and put a mass of materials, which the accumulative principle had before been able to grasp, beyond its reach.
The extent to which the banking system may, in any country be carried, seems to depend on four circumstances.
1st. The amount of the science, skill, and population existing in the country, to work up the materials it affords, and the abundance of these materials.
2nd. The strength of the accumulative principle, the opportunity it has had to operate, and consequent division of employments, approach of instruments to the more slowly returning orders, and accumulation of stock. These two circumstances determine the amount of the possible exchanges, and, consequently, of the money that may be employed in effecting them.
3d. The general intelligence, sagacity, and integrity of the members of the community. A person greatly deficient in any of these respects, is one with whom a banker would not wish to deal. But, these qualities are of those giving strength to the effective desire of accumulation; this circumstance, therefore, may be considered as merging in the last, the general strength of the accumulative principle.
4th. The efficiency and security of the system of banking adopted.
On the other hand, the benefits to be derived from banking, in proportion to its extent, would seem to be greater, the nearer instruments are to the more quickly returning orders, and the greater consequently the scarcity of specie. Where, therefore, the accumulative principle being strong, and from the implied intelligence, and honesty of the community, the system of banking extensively practicable, but from want of time to work up materials to more slowly returning orders, instruments are at those of quicker return, there the operations of the banker are peculiarly beneficial.
We have, perhaps, sufficiently enlarged already, on the three first of the circumstances referred to. It only remains, to show the chief points of connexion of the last of them, with the principles it has been attempted to explain. To do so, it is necessary to refer to the occasional evils resulting from the system of banking, diminishing its general utility. They may be reduced to two.
1st. The money which bankers circulate, must be the representative of real property. It must be exchangeable for some commodity, or commodities, equal to the amount at which it is rated. If it may be always exchanged for specie, or for some proportion of the general revenue abstracted for the purposes of government, it will be a representative of something real. But it sometimes happens that bankers squander, or waste, the funds provided for payment of the demands to which they are liable, and this being discovered, their money becomes valueless, and those holding it as an equivalent to capital, sustain loss to the amount they bold. The loss thus sustained, both in itself, and in the general diminution of confidence in banking transactions and retardation of exchanges consequent on it, makes it a matter of great importance to every mercantile community, to have banks of indubitable solvency established throughout it. It were beyond the present purpose, to inquire into the particular system and regulations that may best produce such a result. There are, however, two general observations, arising from the nature of things, which naturally present themselves.
When capital is largely accumulated, and at orders of slow return, there will be very many, who will be disposed to allow their funds to remain in that employment, and be content with the moderate revenue thus produced to them. When, on the other hand, they are at orders of quicker return, there is a great temptation to divert the fired, set apart for these purposes, to speculations promising great gain, but sometimes producing great loss. Banking will consequently be in general safest, where capital is most largely accumulated.
Again, as no possible precaution can prevent a company of bankers from acting dishonestly, who are willing to combine for such a purpose, for they can only be required to produce statements drawn up by themselves, where there exists a great deficiency of real principle, and a proneness to defraud, banking becomes dangerous or impracticable.
2d. The second evil arising from the practice of banking, has its origin, in the system of credit itself; and the shock which, as it is rounded on prevailing opinion, it is liable to receive from whatever shakes public confidence.
Every person engaged in the formation and transfer of commodities, and adopting the system of credit as the medium of transfer, is indebted to some individuals, as, in turn, other individuals are indebted to him. The stock also of instruments he has on hand, allows him to offer a certain amount of commodities for sale, and requires him, if he continue his business on the same footing, to purchase certain other commodities, and pay for certain amounts of labor. What is owing him, and payable within a given time, may exceed what he owes others, payable within the same time, or may equal it, or come short of it. What he is able to sell others within a given time, may also exceed what he requires to buy within the same time, or may be equal to, or less than it. It will always be the case, too, that individuals will look forward for the means of discharging the debts they have contracted, not only to the debts owing them by others, but to the sales they expect to effect. Were this to happen only to persons of really abundant capital, there would be no reason to fear the non-performance of engagements contracted. But it also happens to those, whose capitals bare been reduced by misfortune or imprudence, and therefore, there are always many in every mercantile community, whose ability to discharge their obligations is more or less doubtful. When, therefore, any cause operating extensively, and prejudicially, on mercantile transactions occurs, it generally happens, that there arise cases of incapacity to meet engagements, and, as one man depends for the means of discharging his debts, on the debts others owe him, that embarrassment and distress spread throughout the whole mercantile body. The experience of the misfortunes attending this. state of things, leads every one engaged in business, when he thinks there is reason to fear its approach, to endeavor to withdraw himself from the danger, by avoiding to contract obligations to pay. There is consequently a general diminution of purchases, and a general temporary fall in prices.(53)
But while prudent people are thus able to secure themselves from evil, they increase the difficulties of those, who have contracted obligations to pay, in dependence on the proceeds of sales to be effected; and some of these becoming incapable of obtaining the means of meeting their engagements, their failure increases the general distress, and farther lessens the number inclined to purchase.
At this conjuncture, the affairs of the banker undergo a revolution. For, as the number of buyers diminishes, there is less money requisite for transacting the business of the community, and this overplus naturally returns on him. But while less money is really wanted to execute the business of the society, he is called on to furnish as much, or probably more. The debts those dealing with him formerly contracted have to be paid, while the sales of commodities, the means by which it was anticipated that part of the funds for that payment, would be procured, have much diminished.
The situation of the banker becomes therefore at this crisis, very critical. He cannot, in justice to himself, grant all the requisite accommodation, and yet, his refraining from doing so must aggravate existing evils. As specie is, in such a state of things, the most desirable of commodities, he has reason to fear that a large portion of his money will be returned on him, which he will be required to replace with gold or silver, and he knows that if a suspicion of his solvency arise, tie may be required thus to replace the whole of it. If he be unable to meet these difficulties, his failure adds very much to the general mass of misfortune, and farther diminishes public confidence.
The natural termination to such a state of things, would seem to be the diminution of contracts, and consequently of debts, progressively diminishing the amount of payments, for which it is necessary to provide. This termination is retarded by the struggles of those whose real funds, in proportion to the extent of their business, are smallest, and whose motives to engage in fresh transactions, are chiefly the hopes of extricating themselves from the embarrassments in which present transactions have involved them. It is also more injuriously retarded, as has been observed, by the failure of those engaged in the business of banking.
The liability of the mercantile community to be largely affected by such sudden pressures, must depend, in a great degree, on the peculiar circumstances of the country, and nature of the employments and trades carried on in it.
It must also be dependent on the system of banking, that is there pursued, and its capacity to furnish funds where there is real capital; to check unsafe and gambling transactions by withholding funds from those desirous of extending hazardous speculations, though deficient in capital; and to pursue its operations steadily and confidently notwithstanding any general embarrassment. To attempt, however, an enumeration and comparison of the different systems of transacting the business of banking, which have been adopted in different times and places, would involve us in inquiries of so complicated a nature, that while to discuss them partially would be unsatisfactory, to do so fully would lead too far from our present object. I reserve therefore the few observations I have to make On the subject, to another place.(54)
Gold and silver would thus seem to have been considered, first, simply as themselves the most precious, and easily preserved of all articles; next, their capacity for being divided and re-united without injury, would seem to have led to their general employment in exchange for other things the acquisition of which their possessors found useful or necessary;(55) convenience then to have rendered it expedient to have them formed into pieces of a certain weight, and fineness, when they began to constitute what is now called money; lastly, their general adoption as money would seem naturally to have rendered them proper measures to give fixedness to those obligations to future delivery of things in exchange, which the increased security and tranquillity of modern times, and the great amount of exchanges transacted, have in recent days, introduced. In the two latter employments, as serving for real, or determining the rights which the possession of fictitious money conveys, they occasionally serve as media for exchanging all instruments, and, therefore, for determining and expressing their relation to each other, as things capable of being exchanged. In this way measuring all things exchanged, or capable of being exchanged, that is, all instruments, they come to denote the amount of instruments, or capital, or stock, which any man possesses. A person is said to be worth five hundred, or five thousand pounds, as be has instruments, which, in exchange, would be measured by these sums respectively; and, as in common life all things are considered, not as they are, but merely in their actions and relations, instruments come there, also, to be spoken about, and conceived of, altogether in the relation they have to certain pieces of gold and silver.
These are not the only effects which the exchange of instruments for one another, and the consequent use of money as the medium of exchange, have produced in our conceptions of them. The system of exchanges, being attended by that of credit, implies the existence of some mode of ascertaining the amount to be rendered back, for instruments received in trust. It is sufficiently obvious that this must be determined by the order to which the principle of accumulation, and the time it has had to operate, has carried the formation of instruments in the society. If, in any society, instruments are at the order D, doubling in four years, then one receiving an instrument on trust, for four years, will, at the end of that period, have to return two of the same sort and quality. If they are at the order E, he will have to return two at the end of five years, etc. Thus it is a common practice in many parts of North America, especially in new settlements, to sell cattle and sheep on trust, the terms being that double the number thus transferred, is to be returned in four or five years, as the agreement may be made. More generally, however, much shorter periods are adopted, for the settlement of accounts. The natural periods of a year, and a month, have in different times and places, been made choice of for this purpose. It is then necessary to calculate what is due, by the one party to the other at these periods, and these calculations are naturally made in money.
Instead, for instance, of returning two cows at the end of five years, the bargain may be, that a proportional sum is to be paid at the end of the first, second, third, fourth, and fifth years. Were money paid for the cow immediately, the amount we shall say would be twenty dollars, the double of that, which would be the sum to be given were the time of payment deferred till the expiration of five years, is forty dollars. The annual payment can neither be a fifth part of the one sum, four dollars, nor of the other eight dollars, but one between the two, in this case about six dollars. Again, the bargain may be, that a cow be returned, at the expiration of the fifth year, and that, for her use during that time, an annual remuneration be made; this would be a half of the former annual payment, nearly three dollars, and that sum accordingly, when such an arrangement takes place, is the usual yearly payment, for what is called the rent of the cow. Whatever order instruments may be at, some similar calculation might determine, what should be the proportion annually paid for the use of any of them. The employment of money in these calculations has simplified them, by the introduction of general rules. The return which instruments make, is estimated at so much in the hundred, or per cent. that is, in the hundred pounds, dollars or whatever may be the current coin. Reducing our orders to this phraseology, they would be respectively: --
A 100 per cent. per ann.
B 41 " "
C 26 " "
D 19 " "
E 15 " "
F 12 "
G 10 "
H 9 per cent. per ann.
I 8
J 7 "
K 6, 5 "
L 5,9 "
M 5, 5 "
N 5 " " &c.
It is on these principles, that all reckonings are made., not only of instruments given on credit, but of those retained. In the latter case, the annual return is termed profits of stock, in the former interest. There is, however, this difference between the two, that, in the profits of stock, is generally included the return that has to be made, for the mental exertion and anxiety, and bodily fatigue, of the owner of the stock. There is, also, a difference between them, in common language, arising from its being the practice to speak of the more favorable issues of instruments, as determining the rate, without reckoning those that have turned out less favorably, or unfortunately. Thus Adam Smith: "In a country where the ordinary rate of clear profit is eight or ten per cent. it may be reasonable that one half of it should go to interest, wherever business is carried on with borrowed money. The stock is at the risk of the borrower, who, as it were, insures it to the lender; and four or five per cent. may, in the greater part of trades, be both a sufficient profit upon the risk of this insurance, and a sufficient recompense for the trouble of employing the stock."(56) Here, ordinary profit evidently means, not the average profit, but the profit of favorable years. The average profit of a merchant, for example, is not properly the profit he makes upon his more favorable adventures, but what he makes on all those adventures that yield a profit, whether great or small, after deducting the actual loss he may sustain on others. The average profits of all the merchants of any country, also include their very favorable, their less favorable, and their losing adventures. In this way, using the term profit, for the return made from the outlay expended on the formation of the whole instruments spoken of, actual losses are also included in it, and, in speaking prospectively of future profit, the risk of future loss is included, and what Adam Smith calls the risk of insurance disappears. If in a country where the average profit is, in reality, only eight per cent. a particular merchant continue for some years, to make ten per cent. he may indeed expect, and is perhaps apt to expect, the same return in future years, but, unless in so far as he can truly calculate on his mercantile sagacity and activity being above par, in so doing, he acts imprudently, and the chances are, that he is undeceived by having to sustain actual losses in succeeding years.
We may then assume the rate of interest as a fair measure of the real average rate of profits, in any country, and consequently of the order in our series, at which instruments are there arrived. So receiving it, we shall find that it agrees very closely with tho preceding observations.
In China, we are told by Barrow, that the legal rate of interest is twelve per cent, but that, in reality, it varies from eighteen to thirty-six. The remarks of other authors agree pretty accurately with this statement, fixing the orders at C or D. Tho Dutch seem, of all European nations, hitherto to have been inclined to carry instruments to the most slowly returning orders. The durability given to all the instruments constructed by them, the care with which they are finished, and the attention paid to preserving and repairing them, have been often noticed by travellers. In the days when their industry and frugality were most remarkable, interest was very low, government borrowing at two per cent. and private people at three.(57) The former indicating an order doubling in about thirty-three years, the latter one doubling in twenty-three years. In ancient Rome, interest was in reality exceedingly high, from twelve to fifty per cent.(58) Were we farther to compare the orders in which instruments appear to stand in other countries, with the rate of interest in those countries, we should find the two every where correspondent. I apprehend, however, that this is needless, for, as the reader must on consideration perceive, it is impossible it can be otherwise. Loans, indeed, pass under the name of money, but money is only the means of effecting the loan, it is in reality instruments that are lent, and they must in return yield not much less than what is paid for their use, otherwise they would not be borrowed, and not much more, otherwise they would not be lent.
The system of calculation, the foundation of which we have been considering as connected with exchanges, is convenient for all engaged in the business of transfers, and answers their purposes very perfectly. When applied, however, to speculative purposes, it labors under the disadvantage to which all practical general rules are liable, when assumed as speculative general principles. According to it, stock is regarded altogether, as measured by money, and an amount of stock is considered, simply, as an amount of money, or something that will bring money. The stocks, therefore, of different countries, are viewed as differing merely in amount, and every increase and diminution of the stock, of the same country, as a simple addition, or substraction, of an homogeneous quantity. These events being so viewed, have been assumed so to exist, and the general increase and diminution of stock, have been treated of, as things, as simple in their nature, as the rows of digits employed to mark the mount of money by which they are estimated. Some of the fallacies hence arising, will be presently noted; they will, I believe, be found to be the foundation of much of the contradictions, in which the reasonings on these subjects are involved.
CHAPTER IX.
OF THE EFFECTS RESULTING FROM DIVERSITIES QF STRENGTH IN THE ACCUMULATIVE PRINCIPLE, IN MEMBERS OF THE SAME SOCIETY.
The mass of the individuals composing any society, being operated on by the same causes, and baring similar manners, habits, and to a great extent feelings also, must approximate to each other, in the strength of their effective desires of accumulation. In the view we have hitherto taken of the subject, we have considered them, as not only approximating, but coinciding in this respect. In reality, however, they do not do so. Though the desire may be generally of nearly equal strength, throughout the bulk of the society, it cannot altogether be so, but must vary, in some, in degrees scarcely perceptible, in others, as in every community there will be men of characters opposite to their fellows, very largely. But there are nevertheless circumstances, which, notwithstanding these variations, restrain and confine the construction of instruments, either altogether to the same order, or to orders much more nearly approximating to each other, than would be indicated by the strength of the effective desire of accumulation, in the individuals forming them.
The accumulative principle of the different individuals composing the same society, may vary from the average strength, either by being above, or below it. There will, in every society, be some individuals not disposed to construct any instruments, but such as are of orders of more quick return than those generally formed, as there will be others, disposed, if they have no opportunity otherwise to make additional provision for futurity, to expend part of their revenue in working up materials even to orders of slower return, than the average of the instruments already formed.
Persons of the former class, possessing any amount of funds presently available, would be inclined to apply them to the formation of instruments, could they obtain materials, returning so largely as to correspond to the estimate they make of the future and the present, But they will not be able to find any such materials, for they will have been previously appropriated, and wrought up more laboriously than they would be inclined to do, by other members of the society. It; again, the funds of an individual of this class, consists of instruments whose returns are future, he will gradually transfer them to other members of the society, whose accumulative principle is stronger than his own; for, according to his estimate of the future and the present, he will receive more for them than they are worth. It thus happens, that all the members of any society, whose accumulative principle is lower than the average, are gradually reduced to poverty. The same persons, moving to a community where instruments were of orders of quicker return than those correspondent to the strength of their own accumulative principle, would acquire property. Thus the artisan, or laborer, who, in England, never thought of saving, is excited to accumulate property, in North America. The Chinese, who, in Europe, would be very prodigals, are accounted frugal in the tropical regions of Asia, and there attain to considerable wealth.
Individuals whose accumulative principle, is, on the other hand, stronger than the other members of the community, would be inclined to construct instruments of orders returning more slowly than usual, rather than not devote a part of their present funds to additional provision for futurity. But this is not necessary. They are the natural recipients of the funds passing from the hands of the prodigal, and their excess of providence, balances his defect, and maintains the whole mass of instruments in the society, at nearly the same orders.
It thus happens, that all instruments capable of transfer, are in the same society, at nearly the same orders. Some instruments, however, cannot be transferred, for many of them that are of gradual exhaustion, and directly supply wants, must belong to the persons exhausting them. Wearing apparel, household furniture, and sometimes dwelling-houses, cannot be the property of any other individuals than those in whose service they are exhausted. Such instruments must often, therefore, correspond to the strength of the accumulative principle of their possessors. If they belong to persons in whom the strength of this principle is greater than the average of the society, they will not indeed vary much from the prevailing orders, the surplus funds of such individuals, going, as we bare seen, to the acquisition of the stock of the prodigal. The difference is probably just sufficient to indicate the character of their owners. Thus, if we inspect the dwelling-houses and furniture of rigid economists, we generally perceive that they have an air both of durability and efficiency, distinguishing them from those of the rest of the community.
When, again, individuals, in whom the strength of the effective desire of accumulation is below the average of the society, have no other stock but what is embodied in instruments of this sort, these instruments, in their exhaustion of them, will correspond to the weaker power of this principle. Such, unfortunately, is sometimes the case, with what are termed the lower classes of society ;' causes to which we shall afterwards advert, sometimes generate a spirit of improvidence among these classes, and diminishing the estimation in which they hold the interests of futurity, incapacitate them from expending any present funds, as a provision for these interests, if they do not return either very speedily, or very largely. The consequence is, that the instruments of this sort which they possess, have but a very small capacity for the supply of their coming needs, and that they are unable to extricate themselves from pressing poverty.
Thus, suppose that a man in this class, has two different hats offered him, the present appearance, and immediate comfort in the wear of which are nearly equal, but of which the one, from its being formed of better materials, and these wrought up with more care, is much more durable than the other, and cannot be afforded but at a higher price than it. Let it be that four days' labor is demanded for the one, and six and a half for the other, but that the former will last only one year, the latter two. It is evident, that, if the effective desire of accumulation of the individual is very weak, not carrying him beyond the order A, he will prefer the former, and at the expiration of the year will consequently have to expend again an equivalent to four days' labor, instead of having this want supplied by a previous expenditure of two and a half days' labor.(59)
We may, in most cases, judge very accurately of the strength of this principle among individuals of this order of society, peasants, mechanics, day-laborers, and domestic servants, by the qualities of the instruments of these sorts with which they provide themselves. By observing, for example, the kind of shoes, gowns, blankets, which a woman in this rank of life purchases, one may form a near guess of her character. Were. she to make a point of selecting such as would wear well, though somewhat dearer, or less showy, we might safely conclude that the influence of the present, did not prevent the interests of the future from being carefully regarded. On the contrary, did she choose the unsubstantial, but more showy, or cheaper article, we might with equal certainty infer, that the present, in her estimation, far outweighed the future. All who have had opportunities of making such observations, must have remarked the influence, which the one line of conduct, or the other, exercises on such individuals. The difference between them constitutes the main distinction between thrift, and unthrift, the former of which is the only safe means, that persons in the lower walks of life possess, through which they may give a beginning to their fortunes. The store accumulated by the exercise of the virtue of providence, which, as it shows itself in them, we thus denominate, enables them to turn the funds of their daily labor to the construction of other instruments than those, and, at length, to add largely to that stock which is destined to supply the future wants of the whole society. What is true concerning one individual, is true concerning many, and on this account, the degree of strength of this principle possessed by what are called the lower orders, exercises a great influence on the amount of the general stock, accumulated by the society. The influence, in this respect, of those who form that class, is, indeed, much more important than we might at first suspect. Their greater numbers would alone make up for the smaller power of each, but besides the weight which this consideration is entitled to, the amount of labor that may, with advantage, be accumulated by the mere working man, in instruments of this sort, is, in reality, very considerable. His dwelling and its contents, may fitly be considered as a store that he possesses, for the supply of the future wants of himself and family, or, what is the same thing, for the abridgment of their future labor, and according as there is much or little of this provision wrought up in them, will the one be supplied or the other saved. First, the house itself, as the place in which he and they live, and pursue many of their various occupations, will not yield the advantages it ought, if the apartments be not so roomy, and well lighted, as neither from the closeness of the atmosphere to induce debility or disease, nor, from their confinedness and obscurity, to cramp and retard the inmates in their several labors. Then, according to the compactness and finish that is given to the walls and other parts will the inclemency of the weather be more or less excluded, and a greater or less quantity of fuel, be in future requisite. The cupboards, where things may be readily put past, and as readily found, and where they are preserved from destroying causes and accidents, the cooking utensils, the bedding, and the numerous other articles of the sort, that enter into the domestic economy of a frugal and industrious family, are to be considered, in like manner, as so many means by which future labor, or future expense may be prevented or diminished. The extent of the saving which the provident working man in this way effects, is sometimes very great. In a rude, or imperfectly finished fabric, fuel must be wasted; in one where there are not proper conveniences for preserving and cooking food, food must be wasted; and where there are not fit places for depositing articles of wearing apparel, they must soon get dirty, and receive much unnecessary damage. In a well finished, and convenient habitation, too, the inmates lose no time, either from torpor in winter's cold, or languor in summer's heat; they have space and comfort to pursue their various labors, and unless the periods given to repose, and to their meals, may employ the whole time they spend at home, in some useful or agreeable occupation. The animal frame, also, it is to be observed, when exposed to the extremes of heat and cold, and to damp, seems to require a greater supply of nourishment, than when properly sheltered and protected. This is seen in the inferior animals, and agreeing with them in other parts of his corporeal constitution, man does not here differ from them, and when comfortably lodged, is preserved in health and vigor, on a diet which he would else find too scanty. The amount of provision for future needs, that may, in a Similar manner, be embodied by a laborer or mechanic having a family, in bedding, and other furniture, and in kitchen utensils, is very considerable.(60)
It is to be here observed, that the prevalence of a really economical spirit among the working class, implies no diminution of the purchases made by them. On the contrary, it being the desire of the laborer, under such a supposition, to turn every six-pense he can earn, to some useful employment, either to the acquisition of necessaries, or other commodities, he must have as many demands on the capitalist as before. The change produced, would be, in the articles purchased. The proportion of those providing for the wants of futurity would increase, that of those ministering to the gratifications of the present, diminish.
Thus, such a spirit pervading the working classes in Great Britain, at the present period, would probably lead them to abandon all delicacies of fare, and would occasion a diminished consumption of alcoholic liquors, tea, coffee, silks, expensive calicoes, and the more showy articles of apparel. It would, on the other hand, increase the demand for the higher priced, and more substantial cloths, cottons, blankets, kitchen utensils, and articles of that sort, and for all matters used in the construction of dwelling-houses.
Neither, it is to be observed, would the prevalence of a contrary spirit among those orders, and a proneness to seize on the enjoyments of the present, occasion any immediate diminution of their demands on the capitalist. It would merely lead to his providing for them a greater amount of instruments of sudden exhaustion, contributing to the gratification of the instant, and a smaller amount of those of gradual exhaustion, providing for the wants of futurity, and to his giving a construction to the latter, that might make them correspond during the period of their exhaustion, to the lower degree of the accumulative principle of the individuals in whose service they were to be exhausted; such a circumstance, would, therefore, occasion the production of a larger portion of delicacies, of articles of nourishment, more grateful to the senses, but not more nutritious or more wholesome than cheaper fare, of fewer substantial articles of dress and furniture, and more of those that are flimsy and showy.
The whole stock of instruments owned by the laboring population, would thus contain a smaller amount of the means of lessening future labor, or expense, as their effective desire of accumulation diminished in strength. Even instruments that they do not own, but of which they pay for the use, as dwelling-houses, rented by them, are in a great measure, reduced to the same order as those which they would themselves form. In the rank of society above them, improvidence is long before it show on the dwelling; it attacks first other funds; but, as they have not these other funds, it necessarily shows itself in the funds they have. Thus, if a family of improvident habits get the use of the best finished dwelling, they soon so damage it, as to deprive it of its efficiency. Some manifestation of what we call careless habits, want, that is, of taking thought of the consequences of what one is doing, breaks, we shall say, a pane or two of glass, in some of the windows, To get these replaced is present expense, and trouble; demands, perhaps, the doing without a pot or two of liquor, or some other immediate enjoyment, and requires the trouble of going for the glazier, or acting for him. An old hat or two, or some bundles of rags, stuffed into the holes, shifts off this denial of present pleasure, or ease, to some other time, a time which, similar habits, while they render the arrival of it more needful, indefinitely postpone, and the window that had been formed to exclude wind and wet, and admit light, serves, at last, to let in the wet and wind, and shut out the light. Pursue the effects of these habits, this absorption in the present, and heedlessness of the future, as they show themselves upon the plaster, the floor, the ceiling, and we shall find them soon doing away with the efficiency of the whole dwelling, for procuring enjoyment, or saving toil, and reducing it, as far as it. is a provision for the future wants of its inmates, to a condition little superior to that of the miserable mud hut.
The presence of this evil, to a greater or less extent, is marked, by the high rates of interest given, for the petty sums borrowed by individuals of this class. The increase that is said to have taken place in the number of pawn-brokers' shops in England, and the high rate of interest there demanded, and given, by mechanics, for small loans afforded to one another, would seem to indicate its presence, to a degree sufficient to alarm a lover of his country.(61)
When we come to treat of the causes that seem the great agents in diminishing the stock owned by a community, the mode in which the strength of the accumulative principle is weakened, and extravagance introduced among the lower classes, and the effects arising from these circumstances, will present themselves to our notice. It will then appear, that this diversity of the orders of instruments owned throughout a community, can never exceed certain limits. On this account, and because the stock belonging to the lower classes, when the accumulative principle is much lower with them than with the higher ranks, is always inconsiderable, the orders to which instruments belong in the same society, and the returns they make, or the ordinary profits of stock, may be said to be nearly equal throughout every community.
This uniformity in the orders of instruments, and in the returns made by them, in conjunction with the system of calculation, by which, as we have seen, transactions relating to the transfer and accumulation of capital are regulated, produces effects on the conceptions of the individuals concerned, worthy of being noticed.
The rules by which all persons regulate their proceedings in the construction of instruments, are drawn from the returns made by them, that is, the profits yielded by them. If an instrument, or a series of instruments, which it is proposed to construct, promise to yield the usual profits, the enterprise is undertaken, and, if it make the anticipated returns, it is considered a profitable, or gaining business; if it do not promise to yield, and do not yield the usual profits, it is considered an unprofitable, or losing business. Probably, too, it is not considered, that this mode of expression is correct, only as relative to a particular society, and not absolutely, to all societies, and that what in one country or time, may be an unprofitable undertaking, will, without any change of returns, be profitable in another country or time, and vice versa.
Thus, suppose an English land-holder, whose income fir exceeded his outgoings, to be asked why he does not apply his means to enclosing and draining some sea marsh, his answer probably would be, it would not pay. It would only yield me two per cent when finished, and landed property ought to yield four, I can always find estates to purchase, which will produce that. Ask him, why, instead of stone fences round his fields, which decay, or hedges, which require constant trimming and dressing, he does not put iron railings, he will give the same answer, "it would not pay." Ask the house-builder, why this is not cut stone, instead of brick, that oak instead of pine, this again iron, instead of oak, or that copper instead of iron, and consequently the whole fabric doubly durable, he also will reply "it will not pay." In all these cases, and a thousand others that might be put, the answer is abundantly sufficient as regards the individual, but is no answer at all as regard~ the society. The only answer that can be given in old countries at least, for such or similar neglect of materials, is, that there, the effective desire of accumulation is not sufficiently strong, to reach them, in the present state of science and art. Were there fewer prodigal land-holders, in England, estates could not be so easily got, and part of the funds of those who buy estates, would be laid out in improving land at present unproductive, and the salt marsh might be drained. In the same way, houses and other instruments would become more substantial, and better finished, were the strength of the accumulative principle throughout the whole society to advance.
In China, precisely similar replies would be made by capitalists, concerning the draining of marshes, the erection of more substantial buildings, and other enterprises requiring a large present expenditure, for a remote future return. There such undertakings would be really unprofitable, not paying the usual profits of stock, and they can only in like manner become profitable, by the accumulative principle acquiring increased strength, and instruments being wrought up generally to orders of slower return.
This, however, is not the view, which most readily presents itself to practical men. To a person engaged in the practice of an art, the particular mode which the circumstances of the country to which he belongs has rendered the most profitable, and best, is considered as absolutely the best, and most profitable, and if he remove to another country, he is apt to conceive not only that his knowledge of the art is superior, which may perhaps be true, but that the precise mode in which he applies that knowledge to practice, is also the best, that can any where be adopted, which is very possibly erroneous.
A English farmer, for example, who comes to North America to pursue his art, almost always commences on the same system which he followed in Britain. His agricultural implements, his harness, his carts, waggons, etc. are all of the most durable and complete, and, therefore, of the most expensive construction, and his fields are tilled as laboriously, and carefully, as were those he cultivated in his native land. Sometime usually elapses, before he discovers that he may do better by being content with more simple, and less highly finished implements, and that it will be for his advantage to cultivate his land less laboriously, though not less systematically. His neighbors tell him, indeed, from the first, that if he expects the same profits as they have, he must have less dead stock on his hands, and must give more activity to his capital; but he is slow of believing them.
Similar observations alight be made, concerning almost every other class of artists, who emigrate to the new world. They all, at first, give a degree of finish to the materials on which they employ their industry, that is unsuited to the circumstances of the country.
CHAPTER X.
OF THE CAUSES OF THE PROGRESS OF INVENTION, AND OF THE EFFECTS
ARISING FROM IT.
Invention is the most important of the secondary agents, to the influence of which man is subject. To us, it is the great immediate maker of almost all that is the subject of our thoughts, or ministers to our enjoyments, or necessities, nor is there any portion of our existence, which is not indebted to its antecedent forming power. Wherever it really is, it is recognised as one and the same, by this its formative capacity. It is always a maker, and, in a double sense, a maker. From the depths of the infinity lying within and without us, it brings visibly before us forms previously hidden. These are its first works. But neither does it intend to stop, nor does it, in fact, stop here. The forms which its eye thus catches, and its skill "bodies forth" into material shape, pass not away; they remain. Things of power, true workers, drawing to themselves, and fashioning to their semblance, the changeable and fleeting crowd, that time hurries down its stream, they are, in truth, the only permanent dwellers in the world, and rulers of it. In this the double power of his works, the mathematician is as much a maker as the poet, and the poet as the mathematician, and genius in all its manifestations, may, in so far, be considered as the same power, and as excited to action by similar causes.
Our subject leads us to attend to invention, merely as it concerns itself with the material world. But, as the motives exciting the men in whom it is exhibited to give themselves up to its requirements, must be held among the chief of the causes of its manifestation, and as they, who in this department, have been most extensively inventors, have in general communicated little of the principles that animated and sustained them in their career, science and art being silent of themselves, we may be allowed to give wider compass to our view, and to cite, when our purpose requires it, those who have been real discoverers, in any of the various regions over which the power of this principle extends.
The motives, exciting to this sphere of action, are not very apparent.
Man is essentially imitative; his instincts impel him to amalgamate with the mass. From the first moment of his existence, his faculties are on the stretch, drinking greedily in surrounding gestures, feelings, principles and modes of action, which he again communicates; he seems by turns a recipient of existing impressions, and a transmitter of them to others. Nor, unless he look far beyond himself, is there any evident motive for his endeavoring to extricate himself from the ever-whirling circle of which he forms a part. Hundreds of millions have preceded him; to learn and practise, what they have left, is the direct road to his goods, pleasure and honor; why then should the individual waste the sweets of a momentary existence, in rashly and needlessly tasking his feeble powers, to form a new path, when one already exists, along which so many have trodden, and which their footsteps have beaten smooth? One of the Jesuits having been asked, why the Chinese had made no progress in astronomy, beyond the rude elements of the science that they had possessed from a very remote antiquity, answers, flora the indolence, and want of application to these pursuits, of the men of succeeding ages, and from their preferring, like those of the present day, what they have esteemed their immediate and substantial interests, to the vain and barren reputation of having discovered something new. The reason, which the father Parennin assigns for the stationary state of their astronomy, may be transferred to all their other sciences, arts, and pursuits, which fifty generations have contented themselves with learning, practising, and teaching, as they received them from men of times more distant. A well weighed attention to what is for their present, and as they say substantial interests, has led them to do this, and forbid them to do more.
In that Empire, the door to wealth and honor is not absolutely barred to any one, and in this it would seem superior to other lands, that there, whoever possesses learning has a key that will infallibly open it. Let him who would raise himself superior to his fellows, give his youth to study, let him carefully make his own a due portion of the knowledge, the wit, the eloquence, or what passes for them, stored ill the volumes his masters put in his hands. These acquirements will be the passports to the places round which riches and distinctions cluster. Making use of them industriously, prudently, perseveringly, he may certainly attain the rank of a skilful physician, a learned jurist, a practised and ready speaker, or, perhaps, a man versed in the constitution and policy of the empire, fit to take on him the office of a statesman, and share its rewards and honors. He may be attended by obsequious crowds ready to flatter his vanity, minister to his pleasures, conceal his weaknesses; alive he may be honored, dead lamented, -- why then abandon these sure and substantial advantages, to pursue what there is but a chance of gaining, and which, even if at length attained, is but empty fame, -- a breath, -- the filling at the best,
A certain portion of uncertain paper."
The practical wisdom of the Chinese, answers at once it were folly.
Is that, which is sound practical wisdom among those Asiatics, the reverse of it among us Europeans? The reader may determine, by casting his eyes about him, to discover who are the men, who have been most successful in attaining wealth, comfort, respectability; in avoiding dependence, misfortune, calumny. Whoever, or, wherever, he may be, certainly he will not find it is they who have sought to be, or have really been men of genius.
We in vain search for any sufficient motive exciting to this course of action, unless the good arising front communicating good, and the consequent desire to be a benefactor in the most extended possible manner.(62) This desire is the proper aliment of genius. "Leave me not," the lay it,
-- In its loneliness,
Its own still world, amid th' o'er peopled world,
Hath ever breathed to love."
When very strongly felt, it irresistibly impels those who are conscious of capacities equal to the attempt, spite of every obstacle to be overcome, or pain to be endured, to task themselves to the performance of works of permanent and diffusive utility. To reflective minds, and large and generous natures, the creations of genius must present themselves, as of all works, those most extensively conferring enjoyment and power;(63) and their successful execution, as of every enterprise the noblest; nor need we wonder that to such it should have a voice of magical, and almost resistless attraction.
When the peasant poet of Scotland seeks to recall an image of his earliest self, he finds there uppermost this master passion; this "boundless love" of his fellows, and his native land, urging him to make it appear by something worthy of it, and marking its strength. This was the wish,
Ev'n then a wish (I mind its power.")
A wish that, to my latest hour,
Shall strongly heave my breast,"
that led him to the realms of song. This was in truth the genius,
"Sua cuique deus fit dira cupido,"
.
who threw her inspiring mantle over him," and awakening powers else torpid, enabled him to draw from out the vulgarity before hiding them, images not idly failing, and to fall, on many a heart, patriotism ardent and self-devoting; passion manly yet tender; love without the coarseness of the one class of society, or the affectation or epicurism, of the other.
Who can estimate all the effects of these hasty fragments of the poet's art? If we consider the subject well, and weigh it fairly, we shall confess, that their author has exercised an influence already greater, and far more abiding than any of the men of his country and age. It is thus that genius manifests the potency of the principle that inspires it, and that the simplest lays of the simplest bard, may have a power passing far, that of the triumphs of the statesman, or the warrior. The one wakens
energy, otherwise dead, into action, the other merely directs that action.
"But," it may be said, and not without a show of reason: "why, if genius is roused and moved by principles so pure, does it happen, that the undoubted possessors of it, are themselves so often defaced by faults, and that we speak of them and their aberrations, as if naturally conjoined? Ambition, the desire of excelling, a much more questionable motive, would rather seem its proper stimulant."
As we are not attempting to investigate the governing principles of classes, but of societies, it were, perhaps, enough in answer to observe, that the existence of genius among a people, implies at least, the diffusion of a tincture of generous feelings, somewhere throughout the mass. If we were to see an individual, periling his own life, to rescue another from impending danger, it might be doubtful to us whether the action proceeded from a desire of saving the person in danger, or of the applause and praises following the doing of it; but that applause, and those praises, would themselves evince a general perception of the moral worth of such an action, supposing it to proceed from the purest motives, and correspondent sympathy in the pleasure likely to be experienced from it. Vanity could receive no gratification from a deed of this sort, where the spectators, only regarded it as an incomprehensible piece of rashness. In like manner, though it seem to us, that many who have eminently succeeded in the pursuits of which we speak, have been actuated merely by the desire of gratifying a selfish vanity, still, that the attainment of these objects should be followed by the warm and sincere applause, that alone constitutes genuine fame, is a proof at least, of the existence somewhere, of a due appreciation of the motives from which these pursuits are supposed to proceed, and of sympathy with the pure gratifications their success is presumed to yield. But it enters into my design to show, that, without supposing the two classes actuated by different principles, there are sufficient causes for those wanderings, as they are called, of genius from the common path, for that contrariety of course, that seldom in