44. I. Observe that in both conditions, that of central Government-holding, and diffused private-holding, the quant.i.ty of stock is of the same national moment. In the one case, indeed, its amount may be known by examination of the persons to whom it is confided; in the other it cannot be known but by exposing the private affairs of every individual. But, known or unknown, its significance is the same under each condition. The riches of the nation consist in the abundance, and their wealth depends on the nature, of this store.

45. II. In the second place, both conditions, (and all other possible ones) agree in the destructibility or improveability of the store by its holders. Whether in private hands, or under Government charge, the national store may be daily consumed, or daily enlarged, by its possessors; and while the currency remains apparently unaltered, the property it represents may diminish or increase.

46. The first question, then, which we have to put under our simple conception of central Government, namely, "What store has it?" is one of equal importance, whatever may be the const.i.tution of the State; while the second question--namely, "Who are the holders of the store?"

involves the discussion of the const.i.tution of the State itself.

The first inquiry resolves itself into three heads:

1. What is the nature of the store?

2. What is its quant.i.ty in relation to the population?

3. What is its quant.i.ty in relation to the currency?

The second inquiry into two:

1. Who are the Holders of the store, and in what proportions?

2. Who are the Claimants of the store, (that is to say, the holders of the currency,) and in what proportions?

We will examine the range of the first three questions in the present paper; of the two following, in the sequel.

47. I. QUESTION FIRST. What is the nature of the store? Has the nation hitherto worked for and gathered the right thing or the wrong? On that issue rest the possibilities of its life.

For example, let us imagine a society, of no great extent, occupied in procuring and laying up store of corn, wine, wool, silk, and other such preservable materials of food and clothing; and that it has a currency representing them. Imagine farther, that on days of festivity, the society, discovering itself to derive satisfaction from pyrotechnics, gradually turns its attention more and more to the manufacture of gunpowder; so that an increasing number of labourers, giving what time they can spare to this branch of industry, bring increasing quant.i.ties of combustibles into the store, and use the general orders received in exchange to obtain such wine, wool, or corn, as they may have need of.

The currency remains the same, and represents precisely the same amount of material in the store, and of labour spent in producing it. But the corn and wine gradually vanish, and in their place, as gradually, appear sulphur and saltpetre, till at last the labourers who have consumed corn and supplied nitre, presenting on a festal morning some of their currency to obtain materials for the feast, discover that no amount of currency will command anything Festive, except Fire. The supply of rockets is unlimited, but that of food, limited, in a quite final manner; and the whole currency in the hands of the society represents an infinite power of detonation, but none of existence.

48. This statement, caricatured as it may seem, is only exaggerated in a.s.suming the persistence of the folly to extremity, unchecked, as in reality it would be, by the gradual rise in price of food. But it falls short of the actual facts of human life in expression of the depth and intensity of the folly itself. For a great part (the reader would not believe how great until he saw the statistics in detail) of the most earnest and ingenious industry of the world is spent in producing munitions of war; gathering, that is to say the materials, not of festive, but of consuming fire; filling its stores with all power of the instruments of pain, and all affluence of the ministries of death. It was no true _Trionfo della Morte_[19] which men have seen and feared (sometimes scarcely feared) so long; wherein he brought them rest from their labours. We see, and share, another and higher form of his triumph now. Task-master, instead of Releaser, he rules the dust of the arena no less than of the tomb; and, content once in the grave whither man went, to make his works to cease and his devices to vanish,--now, in the busy city and on the serviceable sea, makes his work to increase, and his devices to multiply.

49. To this doubled loss, or negative power of labour, spent in producing means of destruction, we have to add, in our estimate of the consequences of human folly, whatever more insidious waste of toil there is in production of unnecessary luxury. Such and such an occupation (it is said) supports so many labourers, because so many obtain wages in following it; but it is never considered that unless there be a supporting power in the product of the occupation, the wages given to one man are merely withdrawn from another. We cannot say of any trade that it maintains such and such a number of persons, unless we know how and where the money, now spent in the purchase of its produce, would have been spent, if that produce had not been manufactured. The purchasing funds truly support a number of people in making This; but (probably) leave unsupported an equal number who are making, or could have made That. The manufacturers of small watches thrive at Geneva;--it is well;--but where would the money spent on small watches have gone, had there been no small watches to buy?

50. If the so frequently uttered aphorism of mercantile economy--"labour is limited by capital," were true, this question would be a definite one. But it is untrue; and that widely. Out of a given quant.i.ty of funds for wages, more or less labour is to be had, according to the quant.i.ty of will with which we can inspire the workman; and the true limit of labour is only in the limit of this moral stimulus of the will, and of the bodily power. In an ultimate, but entirely unpractical sense, labour is limited by capital, as it is by matter--that is to say, where there is no material, there can be no work,--but in the practical sense, labour is limited only by the great original capital of head, heart, and hand. Even in the most artificial relations of commerce, labour is to capital as fire to fuel: out of so much fuel, you _can_ have only so much fire; but out of so much fuel, you _shall_ have so much fire,--not in proportion to the ma.s.s of combustible, but to the force of wind that fans and water that quenches; and the appliance of both. And labour is furthered, as conflagration is, not so much by added fuel, as by admitted air.[20]

51. For which reasons, I had to insert, in - 49, the qualifying "probably;" for it can never be said positively that the purchase-money, or wages fund of any trade is withdrawn from some other trade. The object itself may be the stimulus of the production of the money which buys it; that is to say, the work by which the purchaser obtained the means of buying it, would not have been done by him unless he had wanted that particular thing. And the production of any article not intrinsically (nor in the process of manufacture) injurious, is useful, if the desire of it causes productive labour in other directions.

52. In the national store, therefore, the presence of things intrinsically valueless does not imply an entirely correlative absence of things valuable. We cannot be certain that all the labour spent on vanity has been diverted from reality, and that for every bad thing produced, a precious thing has been lost. In great measure, the vain things represent the results of roused indolence; they have been carved, as toys, in extra time; and, if they had not been made, nothing else would have been made. Even to munitions of war this principle applies; they partly represent the work of men who, if they had not made spears, would never have made pruning hooks, and who are incapable of any activities but those of contest.

53. Thus then, finally, the nature of the store has to be considered under two main lights; the one, that of its immediate and actual utility; the other, that of the past national character which it signifies by its production, and future character which it must develop by its use. And the issue of this investigation will be to show us that.

Economy does not depend merely on principles of "demand and supply," but primarily on what is demanded, and what is supplied; which I will beg of you to observe, and take to heart.

54. II. QUESTION SECOND.--What is the quant.i.ty of the store, in relation to the population?

It follows from what has been already stated that the accurate form in which this question has to be put is--"What quant.i.ty of each article composing the store exists in proportion to the real need for it by the population?" But we shall for the time a.s.sume, in order to keep all our terms at the simplest, that the store is wholly composed of useful articles, and accurately proportioned to the several needs for them.

Now it cannot be a.s.sumed, because the store is large in proportion to the number of the people, that the people must be in comfort; nor because it is small, that they must be in distress. An active and economical race always produces more than it requires, and lives (if it is permitted to do so) in competence on the produce of its daily labour.

The quant.i.ty of its store, great or small, is therefore in many respects indifferent to it, and cannot be inferred from its aspect. Similarly an inactive and wasteful population, which cannot live by its daily labour, but is dependent, partly or wholly, on consumption of its store, may be (by various difficulties, hereafter to be examined, in realizing or getting at such store) retained in a state of abject distress, though its possessions may be immense. But the results always involved in the magnitude of store are, the commercial power of the nation, its security, and its mental character. Its commercial power, in that according to the quant.i.ty of its store, may be the extent of its dealings; its security, in that according to the quant.i.ty of its store are its means of sudden exertion or sustained endurance; and its character, in that certain conditions of civilization cannot be attained without permanent and continually acc.u.mulating store, of great intrinsic value, and of peculiar nature.[21]

55. Now, seeing that these three advantages arise from largeness of store in proportion to population, the question arises immediately, "Given the store--is the nation enriched by diminution of its numbers?

Are a successful national speculation, and a pestilence, economically the same thing?"

This is in part a sophistical question; such as it would be to ask whether a man was richer when struck by disease which must limit his life within a predicable period, than he was when in health. He is enabled to enlarge his current expenses, and has for all purposes a larger sum at his immediate disposal (for, given the fortune, the shorter the life, the larger the annuity); yet no man considers himself richer because he is condemned by his physician.

56. The logical reply is that, since Wealth is by definition only the means of life, a nation cannot be enriched by its own mortality. Or in shorter words, the life is more than the meat; and existence itself, more wealth than the means of existence. Whence, of two nations who have equal store, the more numerous is to be considered the richer, provided the type of the inhabitant be as high (for, though the relative bulk of their store be less, its relative efficiency, or the amount of effectual wealth, must be greater). But if the type of the population be deteriorated by increase of its numbers, we have evidence of poverty in its worst influence; and then, to determine whether the nation in its total may still be justifiably esteemed rich, we must set or weigh, the number of the poor against that of the rich.

To effect which piece of scale-work, it is of course necessary to determine, first, who are poor and who are rich; nor this only, but also how poor and how rich they are. Which will prove a curious thermometrical investigation; for we shall have to do for gold and for silver, what we have done for quicksilver;--determine, namely, their freezing-point, their zero, their temperate and fever-heat points; finally, their vaporescent point, at which riches, sometimes explosively, as lately in America, "make to themselves wings:"--and correspondently, the number of degrees _below_ zero at which poverty, ceasing to brace with any wholesome cold, burns to the bone.[22]

57. For the performance of these operations, in the strictest sense scientific, we will first look to the existing so-called "science" of Political Economy; we will ask it to define for us the comparatively and superlatively rich, and the comparatively and superlatively poor; and on its own terms--if any terms it can p.r.o.nounce--examine, in our prosperous England, how many rich and how many poor people there are; and whether the quant.i.ty and intensity of the poverty is indeed so overbalanced by the quant.i.ty and intensity of wealth, that we may permit ourselves a luxurious blindness to it, and call ourselves, complacently, a rich country. And if we find no clear definition in the existing science, we will endeavour for ourselves to fix the true degrees of the scale, and to apply them.[23]

58. QUESTION THIRD. What is the quant.i.ty of the store in relation to the Currency?

We have seen that the real worth of the currency, so far as dependent on its relation to the magnitude of the store, may vary, within certain limits, without affecting its worth in exchange. The diminution or increase of the represented wealth may be unperceived, and the currency may be taken either for more or less than it is truly worth. Usually it is taken for much more; and its power in exchange, or credit-power, is thus increased up to a given strain upon its relation to existing wealth. This credit-power is of chief importance in the thoughts, because most sharply present to the experience, of a mercantile community: but the conditions of its stability[24] and all other relations of the currency to the material store are entirely simple in principle, if not in action. Far other than simple are the relations of the currency to the available labour which it also represents. For this relation is involved not only with that of the magnitude of the store to the number, but with that of the magnitude of the store to the mind, of the population. Its proportion to their number, and the resulting worth of currency, are calculable; but its proportion to their will for labour is not. The worth of the piece of money which claims a given quant.i.ty of the store is, in exchange, less or greater according to the facility of obtaining the same quant.i.ty of the same thing without having recourse to the store. In other words it depends on the immediate Cost and Price of the thing. We must now, therefore, complete the definition of these terms.

59. All cost and price are counted in Labour. We must know first, therefore, what is to be counted _as_ Labour.

I have already defined labour to be the Contest of the life of man with an opposite. Literally, it is the quant.i.ty of "Lapse," loss, or failure of human life, caused by any effort. It is usually confused with effort itself, or the application of power (opera); but there is much effort which is merely a mode of recreation, or of pleasure. The most beautiful actions of the human body, and the highest results of the human intelligence, are conditions, or achievements, of quite unlaborious,--nay, of recreative,--effort. But labour is the _suffering_ in effort. It is the negative quant.i.ty, or quant.i.ty of de-feat, which has to be counted against every Feat, and of de-fect which has to be counted against every Fact, or Deed of men. In brief, it is "that quant.i.ty of our toil which we die in."

We might, therefore, _a priori_, conjecture (as we shall ultimately find), that it cannot be bought, nor sold. Everything else is bought and sold for Labour, but labour itself cannot be bought nor sold for anything, being priceless.[25] The idea that it is a commodity to be bought or sold, is the alpha and omega of Politico-Economic fallacy.

60. This being the nature of labour, the "Cost" of anything is the quant.i.ty of labour necessary to obtain it;--the quant.i.ty for which, or at which, it "stands" (constant). It is literally the "Constancy" of the thing;--you shall win it--move it--come at it, for no less than this.

Cost is measured and measurable (using the accurate Latin terms) only in "labour," not in "opera."[26] It does not matter how much _work_ a thing needs to produce it; it matters only how much _distress_. Generally the more the power it requires, the less the distress; so that the n.o.blest works of man cost less than the meanest.

True labour, or spending of life, is either of the body, in fatigue or pain; of the temper or heart (as in perseverance of search for things,--patience in waiting for them,--fort.i.tude or degradation in suffering for them, and the like), or of the intellect. All these kinds of labour are supposed to be included in the general term, and the quant.i.ty of labour is then expressed by the time it lasts. So that a unit of labour is "an hour's work" or a day's work, as we may determine.[27]

61. Cost, like value, is both intrinsic and effectual. Intrinsic cost is that of getting the thing in the right way; effectual cost is that of getting the thing in the way we set about it. But intrinsic cost cannot be made a subject of a.n.a.lytical investigation, being only partially discoverable, and that by long experience. Effectual cost is all that the political Economist can deal with; that is to say, the cost of the thing under existing circ.u.mstances, and by known processes.

Cost, being dependent much on application of method, varies with the quant.i.ty of the thing wanted, and with the number of persons who work for it. It is easy to get a little of some things, but difficult to get much; it is impossible to get some things with few hands, but easy to get them with many.

62. The cost and value of things, however difficult to determine accurately, are thus both dependent on ascertainable physical circ.u.mstances.[28]

But their _price_ is dependent on the human will.

Such and such a thing is demonstrably good for so much. And it may demonstrably be had for so much.

But it remains questionable, and in all manner of ways questionable, whether I choose to give so much.[29]

This choice is always a relative one. It is a choice to give a price for this, rather than for that;--a resolution to have the thing, if getting it does not involve the loss of a better thing. Price depends, therefore, not only on the cost of the commodity itself, but on its relation to the cost of every other attainable thing.

Farther. The _power_ of choice is also a relative one. It depends not merely on our own estimate of the thing, but on everybody else's estimate; therefore on the number and force of the will of the concurrent buyers, and on the existing quant.i.ty of the thing in proportion to that number and force.

Hence the price of anything depends on four variables.

(1.) Its cost.