Question of the proper definition of the wealth of a state -
Reason given by the French economists for considering all
manufacturers as unproductive labourers, not the true reason -
The labour of artificers and manufacturers sufficiently
productive to individuals, though not to the state - A remarkable
passage in Dr Price's two volumes of Observations - Error of Dr
Price in attributing the happiness and rapid population of
America, chiefly, to its peculiar state of civilization - No
advantage can be expected from shutting our eyes to the
difficulties in the way to the improvement of society.
A QUESTION seems naturally to arise here whether the exchangeable
value of the annual produce of the land and labour be the proper
definition of the wealth of a country, or whether the gross
produce of the land, according to the French economists, may not
be a more accurate definition. Certain it is that every increase
of wealth, according to the definition of the economists, will be
an increase of the funds for the maintenance of labour, and
consequently will always tend to ameliorate the condition of the
labouring poor, though an increase of wealth, according to Dr
Adam Smith's definition, will by no means invariably have the
same tendency. And yet it may not follow from this consideration
that Dr Adam Smith's definition is not just. It seems in many
respects improper to exclude the clothing and lodging of a whole
people from any part of their revenue. Much of it may, indeed, be
of very trivial and unimportant value in comparison with the food
of the country, yet still it may be fairly considered as a part
of its revenue; and, therefore, the only point in which I should
differ from Dr Adam Smith is where he seems to consider every
increase of the revenue or stock of a society as an increase of
the funds for the maintenance of labour, and consequently as
tending always to ameliorate the condition of the poor.
The fine silks and cottons, the laces, and other ornamental
luxuries of a rich country, may contribute very considerably to
augment the exchangeable value of its annual produce; yet they
contribute but in a very small degree to augment the mass of
happiness in the society, and it appears to me that it is with
some view to the real utility of the produce that we ought to
estimate the productiveness or unproductiveness of different
sorts of labour. The French economists consider all labour
employed in manufactures as unproductive. Comparing it with the
labour employed upon land, I should be perfectly disposed to
agree with them, but not exactly for the reasons which they give.
They say that labour employed upon land is productive because the
produce, over and above completely paying the labourer and the
farmer, affords a clear rent to the landlord, and that the labour
employed upon a piece of lace is unproductive because it merely
replaces the provisions that the workman had consumed, and the
stock of his employer, without affording any clear rent whatever.
But supposing the value of the wrought lace to be such as that,
besides paying in the most complete manner the workman and his
employer, it could afford a clear rent to a third person, it
appears to me that, in comparison with the labour employed upon
land, it would be still as unproductive as ever. Though,
according to the reasoning used by the French economists, the man
employed in the manufacture of lace would, in this case, seem to
be a productive labourer. Yet according to their definition of
the wealth of a state, he ought not to be considered in that
light. He will have added nothing to the gross produce of the
land: he has consumed a portion of this gross produce, and has
left a bit of lace in return; and though he may sell this bit of
lace for three times the quantity of provisions that he consumed
whilst he was making it, and thus be a very productive labourer
with regard to himself, yet he cannot be considered as having
added by his labour to any essential part of the riches of the
state. The clear rent, therefore, that a certain produce can
afford, after paying the expenses of procuring it, does not
appear to be the sole criterion, by which to judge of the
productiveness or unproductiveness to a state of any particular
species of labour.
Suppose that two hundred thousand men, who are now employed
in producing manufactures that only tend to gratify the vanity of
a few rich people, were to be employed upon some barren and
uncultivated lands, and to produce only half the quantity of food
that they themselves consumed; they would be still more
productive labourers with regard to the state than they were
before, though their labour, so far from affording a rent to a
third person, would but half replace the provisions used in
obtaining the produce. In their former employment they consumed a
certain portion of the food of the country and left in return
some silks and laces. In their latter employment they consumed
the same quantity of food and left in return provision for a
hundred thousand men. There can be little doubt which of the two
legacies would be the most really beneficial to the country, and
it will, I think, be allowed that the wealth which supported the
two hundred thousand men while they were producing silks and
laces would have been more usefully employed in supporting them
while they were producing the additional quantity of food.
A capital employed upon land may be unproductive to the
individual that employs it and yet be highly productive to the
society. A capital employed in trade, on the contrary, may be
highly productive to the individual, and yet be almost totally
unproductive to the society: and this is the reason why I should
call manufacturing labour unproductive, in comparison of that
which is employed in agriculture, and not for the reason given by
the French economists. It is, indeed, almost impossible to see
the great fortunes that are made in trade, and the liberality
with which so many merchants live, and yet agree in the statement
of the economists, that manufacturers can only grow rich by
depriving themselves of the funds destined for their support. In
many branches of trade the profits are so great as would allow of
a clear rent to a third person; but as there is no third person
in the case, and as all the profits centre in the master
manufacturer, or merchant, he seems to have a fair chance of
growing rich, without much privation; and we consequently see
large fortunes acquired in trade by persons who have not been
remarked for their parsimony.
Daily experience proves that the labour employed in trade and
manufactures is sufficiently productive to individuals, but it
certainly is not productive in the same degree to the state.
Every accession to the food of a country tends to the immediate
benefit of the whole society; but the fortunes made in trade tend
but in a remote and uncertain manner to the same end, and in some
respects have even a contrary tendency. The home trade of
consumption is by far the most important trade of every nation.
China is the richest country in the world, without any other.
Putting then, for a moment, foreign trade out of the question,
the man who, by an ingenious manufacture, obtains a double
portion out of the old stock of provisions, will certainly not to
be so useful to the state as the man who, by his labour, adds a
single share to the former stock. The consumable commodities of
silks, laces, trinkets, and expensive furniture, are undoubtedly
a part of the revenue of the society; but they are the revenue
only of the rich, and not of the society in general. An increase
in this part of the revenue of a state, cannot, therefore, be
considered of the same importance as an increase of food, which
forms the principal revenue of the great mass of the people.
Foreign commerce adds to the wealth of a state, according to
Dr Adam Smith's definition, though not according to the
definition of the economists. Its principal use, and the reason,
probably, that it has in general been held in such high
estimation is that it adds greatly to the external power of a
nation or to its power of commanding the labour of other
countries; but it will be found, upon a near examination, to
contribute but little to the increase of the internal funds for
the maintenance of labour, and consequently but little to the
happiness of the greatest part of society. In the natural
progress of a state towards riches, manufactures, and foreign
commerce would follow, in their order, the high cultivation of
the soil. In Europe, this natural order of things has been
inverted, and the soil has been cultivated from the redundancy of
manufacturing capital, instead of manufactures rising from the
redundancy of capital employed upon land. The superior
encouragement that has been given to the industry of the towns,
and the consequent higher price that is paid for the labour of
artificers than for the labour of those employed in husbandry,
are probably the reasons why so much soil in Europe remains
uncultivated. Had a different policy been pursued throughout
Europe, it might undoubtedly have been much more populous than at
present, and yet not be more incumbered by its population.
I cannot quit this curious subject of the difficulty arising
from population, a subject that appears to me to deserve a minute
investigation and able discussion much beyond my power to give
it, without taking notice of an extraordinary passage in Dr
Price's two volumes of Observations. Having given some tables on
the probabilities of life, in towns and in the country, he says
(Vol. II, p. 243):
From this comparison, it appears with how much truth great cities
have been called the graves of mankind. It must also convince all
who consider it, that according to the observation, at the end of
the fourth essay, in the former volume, it is by no means
strictly proper to consider our diseases as the original
intention of nature. They are, without doubt, in general our own
creation. Were there a country where the inhabitants led lives
entirely natural and virtuous, few of them would die without
measuring out the whole period of present existence allotted to
them; pain and distemper would be unknown among them, and death
would come upon them like a sleep, in consequence of no other
cause than gradual and unavoidable decay.
I own that I felt myself obliged to draw a very opposite
conclusion from the facts advanced in Dr Price's two volumes. I
had for some time been aware that population and food increased
in different ratios, and a vague opinion had been floating in my
mind that they could only be kept equal by some species of misery
or vice, but the perusal of Dr Price's two volumes of
Observations, after that opinion had been conceived, raised it at
once to conviction. With so many facts in his view to prove the
extraordinary rapidity with which population increases when
unchecked, and with such a body of evidence before him to
elucidate even the manner by which the general laws of nature
repress a redundant population, it is perfectly inconceivable to
me how he could write the passage that I have quoted. He was a
strenuous advocate for early marriages, as the best preservative
against vicious manners. He had no fanciful conceptions about the
extinction of the passion between the sexes, like Mr Godwin, nor
did he ever think of eluding the difficulty in the ways hinted at
by Mr Condorcet. He frequently talks of giving the prolifick
powers of nature room to exert themselves. Yet with these ideas,
that his understanding could escape from the obvious and
necessary inference that an unchecked population would increase,
beyond comparison, faster than the earth, by the best directed
exertions of man, could produce food for its support, appears to
me as astonishing as if he had resisted the conclusion of one of
the plainest propositions of Euclid.
Dr Price, speaking of the different stages of the civilized
state, says, 'The first, or simple stages of civilization, are
those which favour most the increase and the happiness of
mankind.' He then instances the American colonies, as being at
that time in the first and happiest of the states that he had
described, and as affording a very striking proof of the effects
of the different stages of civilization on population. But he
does not seem to be aware that the happiness of the Americans
depended much less upon their peculiar degree of civilization
than upon the peculiarity of their situation, as new colonies,
upon their having a great plenty of fertile uncultivated land. In
parts of Norway, Denmark, or Sweden, or in this country, two or
three hundred years ago, he might have found perhaps nearly the
same degree of civilization, but by no means the same happiness
or the same increase of population. He quotes himself a statute
of Henry the Eighth, complaining of the decay of tillage, and the
enhanced price of provisions, 'whereby a marvellous number of
people were rendered incapable of maintaining themselves and
families.' The superior degree of civil liberty which prevailed
in America contributed, without doubt, its share to promote the
industry, happiness, and population of these states, but even
civil liberty, all powerful as it is, will not create fresh land.
The Americans may be said, perhaps, to enjoy a greater degree of
civil liberty, now they are an independent people, than while
they were in subjection in England, but we may be perfectly sure
that population will not long continue to increase with the same
rapidity as it did then.
A person who contemplated the happy state of the lower
classes of people in America twenty years ago would naturally
wish to retain them for ever in that state, and might think,
perhaps, that by preventing the introduction of manufactures and
luxury he might effect his purpose, but he might as reasonably
expect to prevent a wife or mistress from growing old by never
exposing her to the sun or air. The situation of new colonies,
well governed, is a bloom of youth that no efforts can arrest.
There are, indeed, many modes of treatment in the political, as
well as animal, body, that contribute to accelerate or retard the
approaches of age, but there can be no chance of success, in any
mode that could be devised, for keeping either of them in
perpetual youth. By encouraging the industry of the towns more
than the industry of the country, Europe may be said, perhaps, to
have brought on a premature old age. A different policy in this
respect would infuse fresh life and vigour into every state.
While from the law of primogeniture, and other European customs,
land bears a monopoly price, a capital can never be employed in
it with much advantage to the individual; and, therefore, it is
not probable that the soil should be properly cultivated. And,
though in every civilized state a class of proprietors and a
class of labourers must exist, yet one permanent advantage would
always result from a nearer equalization of property. The greater
the number of proprietors, the smaller must be the number of
labourers: a greater part of society would be in the happy state
of possessing property: and a smaller part in the unhappy state
of possessing no other property than their labour. But the best
directed exertions, though they may alleviate, can never remove
the pressure of want, and it will be difficult for any person who
contemplates the genuine situation of man on earth, and the
general laws of nature, to suppose it possible that any, the most
enlightened, efforts could place mankind in a state where 'few
would die without measuring out the whole period of present
existence allotted to them; where pain and distemper would be
unknown among them; and death would come upon them like a sleep,
in consequence of no other cause than gradual and unavoidable
decay.'
It is, undoubtedly, a most disheartening reflection that the
great obstacle in the way to any extraordinary improvement in
society is of a nature that we can never hope to overcome. The
perpetual tendency in the race of man to increase beyond the
means of subsistence is one of the general laws of animated
nature which we can have no reason to expect will change. Yet,
discouraging as the contemplation of this difficulty must be to
those whose exertions are laudably directed to the improvement of
the human species, it is evident that no possible good can arise
from any endeavours to slur it over or keep it in the background.
On the contrary, the most baleful mischiefs may be expected from
the unmanly conduct of not daring to face truth because it is
unpleasing. Independently of what relates to this great obstacle,
sufficient yet remains to be done for mankind to animate us to
the most unremitted exertion. But if we proceed without a
thorough knowledge and accurate comprehension of the nature,
extent, and magnitude of the difficulties we have to encounter,
or if we unwisely direct our efforts towards an object in which
we cannot hope for success, we shall not only exhaust our
strength in fruitless exertions and remain at as great a distance
as ever from the summit of our wishes, but we shall be
perpetually crushed by the recoil of this rock of Sisyphus.