on the
NATIONAL INCOME,
or the
INCOME OF THE COMMUNITY.
As in the administration of a private fortune a knowledge of the income must direct the economical arrangements of the family, so in political economy the question which ought to govern all others, from its importance, and from the consequences which result from it to all the members of the community, is to determine the amount of the social or national income, to discover how much all the different members who compose the community have to spend a year. There is no man who does not feel that in a private fortune his expenses must all depend on his income. We take this word, income or revenue, in its largest sense, as comprising all that part of a fortune which is reproduced annually, so that whoever has the disposal of it, may consume the whole, and employ it entirely for what he wants, without being poorer. We call income, not only the profits of land, and of capital lent, or of houses let, but the profits of all industry, of all commerce, of all agriculture, the wages of all labour, the salaries of all servants, of the public or of private persons; we call income annual gains, whatever they may he, and we repeat that the first question in domestic economy is that which in fact is always asked, how much has this man to spend, by the year, or by the day? It ought to be the first question in political economy also, how much has this nation to spend, by the year, or by the day?
In the management of a private fortune the income is the only reasonable rule of expense or consumption. Every one knows very well that it is the way to ruin, if a man spends his capital with his income. Every one calls ease in his circumstances only the sum of what his income enables him to enjoy, and considers as extravagance whatever exceeds each one's means, and as what will bring inevitable poverty. It is the same with a nation, or with the whole of human society. Its wealth is only the aggregate of all private fortunes, its capital is the capital of all, its income the income of all. And it is as true of a nation as of an individual that it is going to ruin if it spends its capital with its income; that the sum of what it consumes does not indicate ease unless we are assured that there is no waste, that expense does not exceed income.
Every father of a family knows that he can only become rich by economy, by adding to his capital a part of his annual gains. He knows also, that he does not become rich by the fruits of his industry, unless his gains increase with his labour; he knows that there may be a profitable production and one that is not so. The shoemaker knows that if he made a hundred pairs of shoes the last year, by which he gained 3s., and two hundred pairs of shoes this year, on each of which he gets ls. 6d., his income is the same, but his labour is doubled; so that the increase of what he has produced has not been profitable to him: if on each of these two hundred pairs he only got Is., he sees that his labour has doubled whilst his income has diminished one-third. It may be the same with a nation, neither production nor consumption are the certain sign of prosperity, which is increased only by the increase of income.
Every head of a family very nearly calculates the difference between real profits and those that chance may give him. He reckons the first only as his income, and places the second among those happy chauces, of the return of which he has no certainty. Real profit costs no one any thing: he who pays finds his advantage as well as he who receives. Such is the increased quantity which a man obtains from the land by agriculture, when he sows one sack of corn and reaps five; or the amelioration of quality by industry, when a bale of wool is made into cloth; or the great conveuiences which he obtains by commerce, when he brings into towns salt made on the sea shore. But gambling profit, that of speculation, is a loss to him from whom it is taken. The gambler, either on the cards, or in the public funds, or in merchandise, knows very well that he enriches himself at the expense of him who bargains with him; that there is in fact no increase of fortune, only a change; he knows, though in fact it is not of much importance to him, that though the profits of his game add to his own income, they add nothing to that of the nation for they must be deducted from that of his adversary. But the father of a family understands better, because he is more interested in it, that he can give to him who makes real profits a confidence which he refuses to the gambler; for the gambler either plays with equal chances and he must lose as often as he gaines, or he plays with an advantage on his side, and he is dishonest. This man understands also, or he learns by experience, that he who pursues chances, loses successively all the qualities essential to the good ordering of his fortune. Uncertain of the future, he seeks his pleasures in the present; he does not distinguish his capital from his income, for he has really no income; he does not provide for the future with wisdom, for he has no future. For a nation the distinction between real profit and chance profit is still more important than for an individual. Its income arises from the first alone; the second presents positive and negative qualities which balance one another; but the second at the same time spreade vices among the population which destroy industry and foresight, and which lead as certainly to ruin as the dissipation of capital.
Every economist knows also that by his income he ought to regulate the formation and increase of his family; that he ought not to take a wife if he has not enough to keep her as well as himself; that he ought not to wish for children if he has not a sufficient income to divide with them, if he does not believe that he shall leave for them an income equal to his own. The most vehement of human passions may, no doubt, create an illusion as to this, but the more precisely his income is fixed, the more he has stripped it of all increase from chances, the less will this illusion be possible. Every workman knows, at the birth of his children, that they not only will be many years incapable of getting any thing, but will prevent their father and mother from giving all their time to labour, and will consequently diminish their income. The family cannot increase without increasing expenses, and diminishing the means of providing for them. However, if the father of a family has sufficient to meet these without infr'inging on his capital, he must sacrifice other enjoyments for that of being a father. If he is secure of finding profitable situations for his children as soon as they are old enough, he sees without anxiety the increase of his domestic circle; the education of his children is as a chest where he puts his savings; they form a capital from which he expects some day to receive an income. But if, on the contrary, he perceives that his annual gains are not enough, if he sees too that business does not prosper, and that he will not be able to secure to the beings who are so dear to him sufficient income in exchange for their labour, the birth of each fresh child is a calamity. If he is in easy circumstances, he is careful not to expose himself to this; but if he is in one of those unfortunate positions in which men cannot ascertain their future income; if it depends on circumstances over which he has no control, on that terrible game which society sometimes plays at the expense of the poor, then most frequently he gives himself no concern about it, but lets premature deaths repair the excess of births.
Income is the measure of the increase of population in a nation as well as in a family. Income is the measure of subsistence and case to each; the income of the whole is the measure of the subsistence and ease of the whole. The more young children there are in a nation in proportion to the whole number of its population, the more expense increases and income diminishes; on the contrary, the more individuals it contains between twenty and fifty in proportion to the whole population, the greater is the working power. Now population increases whenever labour is sufficiently compensated to increase the income of the working classes. Then there are more births; fathers can make advances for the education of their children, in the hope of future advantages; there is also more longevity in all the working class, for comfort is a cause of good health, and comfort is the consequence of a demand for labour. But if, on the contrary, income diminishes whilst labour increases; if in particular wages diminish; if the poor, to make up for this, force themselves to do more work, they are worn out by labour and privation; they die young, or they languish in sickness; then the number of effective men sensibly diminishes. Perhaps the number of births will diminish also, if habits of prudence and order prevail in the nation; perhaps, on the contrary, they will increase, if men are so much degraded as to think only of the present moment, and of their sensual appetites. Thus it is seen that the disposition to drunkenness increases with indigence, but the children are the first victims of this wretchedness; the more there are born the fewer will there be preserved; as when more are preserved fewer are born. The numerical quantity of the population may in this case be maintained; it may even rise in spite of the diminution of income, but the population arrived at the age of manhood will be diminished, the chances of life will diminish, and the great number of births, which is accounted a sign of prosperity, will only indicate the great number of those who are born only to die, without having known either the pleasures or duties of life.
Malthus has assigned subsistence as the limit of population. Mankind, said he, increases in a geometrical progression, and subsistence only in an arithmetical progression; the first then proceeds towards a frightful famine. There is no doubt that there are limits beyond which subsistence cannot increase in a geometrical progression, that there are even limits beyond which it cannot advance at all; but we are at an infinite distance from these limits. There is room on the earth for an immense development of culture, and those of its products which we appropriate for our subsistence, animals as well as vegetables, multiply in a geometrical progression infinitely more rapid than man. He is, in fact, gifted with such a power of multiplication, that the number of men might be doubled or quadrupled every twenty-five years; he partakes of this power with all organized nature, though of all animals and vegetables he possesses it in the smallest degree. But man is not destined to make an habitual use of this power, and never does. It is only in very rare cases, after a great destruction of the population, or when man is transplanted into a virgin soil, where, great need of labour being felt, a great income arises from this labour, and population rapidly proportions itself to it, because the life of those who would have died in indigence is preserved by easy circumstances. As soon as the level is re-establisbed, population increases in the slowest manner, and this slowness is often even an indication of great prosperity. Where middle life is the longest, where each one who is born has the greatest chance of arriving at advanced age, there also, as at Geneva, the number of births approaches nearest to a perfect equality with the deaths. Still more, where the number of marriages is proportionably the greatest, where the greatest number of persons participate in the duties, the virtues, and the happiness of marriage, the smaller number of children does each marriage produce. At Geneva the average is below three; two children represent the father and mother, and will receive the income which sufficed for their parents; the fraction below the complete third represents the individuals who do not live to a marriageable age, or who die in celibacy. The subdiviaion of inheritances with which we are continually threatened by the English economists is unknown, for the population proportioning itself to the income, maintains itself in the same or increasing ease, without its being possible to say whether its progression is geometrical or arithmetical.
The law which Malthus imagined, with its two progressions, one geometrical and the other arithmetical, and the danger of famine with which he threatened the human race, would only find their application at some hypothetical time which the human race will probably never see. Whereas it is now, it is every day, that the increase of population ought to be regulated by the increase of its means of subsistence. When the population suffers, it is not because corn and meat fail in the market, but because there are not means to purchase them. When it feels at ease, it is not because new supplies of provisions are spread out for sale, but because it has a sufficient income to command what it wants in greater abundance. Malthus himself, though he only expressed the gross and material limit of subsistence— the only one to which his theory of the two progressions can relate—appears to have had a vague idea of the proportion of the population to income; he has explained that by subsistence he understood all the wants of man relative to his condition, which is destroying at the base the reasoning on whioh he relies.
But if income is the measure of the ease and prosperity of all, if it is the regulator of consumption, if it is the regulator of population, how happens it that Malthus has not expressed it, that none of the economists have pointed out its importance, have even mentioned its name? How can this omission be explained, when Adam Smith, the true renovator of this science, owes all the progress he has enabled it to make to his care in constantly comparing public wealth with a private fortune, by the judicious application of all the rules of domessic economy to all the problems of political economy. It is because all dogmatic writers, all those who wish to raiee a system, must attach it to some striking idea which can be understood by all; and that the idea of the social income, of that power which gives the impulse to all the social mechanism, becomes more confused the more they strive to fix it: it escapes them by the infinite multiplicity of its relations, by its continual transtbrmation, by the daily exchange which is made, either in production or in consumption, of the income of one with the capital of another. The economical philosopher looking at all the different kinds of social wealth can never say, this belongs to capital, that to income, without some one being ready to answer; what you call capital is my income, and what you call income is my capital. This impossibility of finding in material things any character by which they may be arranged in either class; this necessity of considering the division in an abstract manner, and as only existing in the appreciation of each person, has caused it to be judged more easy to deny it altogether; to consider only what society produces instead of its income, what it consumes instead of what it spends. The experience, however, of every day ought to teach us, that a nation as well as an individual sometimes sees its circumstances become less easy in proportion as its production increases; that sometimes also the increase of consumption, far from being an expense, is a means of wealth; and that whatever has been used is reproduced in so much abundance, that in consuming, capital is amassed.
The recent sufferings of society will never be truly explored, and it will not be possible to remedy them, till there is some idea affixed to the division of income and capital, however abstruse and intangible it may be. It is useless to open saving banks for the people, without being assured that they have an income out of which they can save; it is useless to labour at their education and instruction, without being first secure, that the time they are obliged to employ in securing an income will leave some little repose for thought, some little vigour for meditation: it is useless to push a new production without being assured that from this production will arise an income proportionate to the efforts which this will require; it is useless to open foreign commerce without being sure that by selling to foreigners income will be increased; that in buying from foreigners, the saving that will be made of one part of income will not annihilate at home another part more important. Population, production, consumption, accumulation, profit, prosperity, indigence, all is connected with income, all is explained by income.
Will it still be asked, what then is social income? It is the sum of the income of every man. What is that sum? We are ignorant of it. Of what material part of wealth is it composed? We are ignorant of that also. We can only seize on the idea of this income as being what is in the hands of each one; we can only recognize it according to the calculation which each one makes for himself. Science points out mysteries which she cannot succeed in enlightening. The management of a fortune is reduced to conjecture, when an exact calculation cannot be arrived at. Now, whenever the question relates to public wealth, where so many positive and negative qualities are imperfectly balanced; where the prime cost, the market or competition price, the price estimated in days of labour, in subsistence, or in money, continually mix together so many opposite ideas, it is not possible to make a valuation which can be expressed by numbers, to arrive at any quantity other than conjectural.
The mercantile system made the wealth of a nation to consist in the gold and silver which she possesses, and which, according to its supporters, she is continually accumulating; the system of the physiocrats only acknowledged as wealth what is derived from land. Both have been victoriously refuted by Adam Smith; both, however, yet maintain an influence which misleads many minds; because, to the question, What is wealth? they can give a positive answer, false, it is true, but one easily remembered, whilst Adam Smith has been able to answer only by an incomplete and vague enumeration, the idea of which, even if it has been well comprehended, soon fades away.
Public wealth, according to Adam Smith, is all that which constitutes the fortune of each one; houses, fields, tools, cattle, man himself, with the skill that he has acquired and his faculty of lahour; then all the products of the industry of man, though some of them are so fugitive that they are not susceptible of accumulation. This enumeration appears very vague, yet it is sufficient to dissipate many errors. By comparing in the fortune of each person these different possessions with the quantity of gold and silver which each one has, it will be acknowledged, that money makes a very small part of wealth, either private or public. It will be acknowledged also, that the mutual debts and credits of two individuals make no part of public wealth, for they are two quantities, negative and positive, which balance one another. The public funds will also disappear, for they are credits of the lenders on the possessions of the taxpayers. Paper money will also disappear, for it is a promise to pay in money, or a mortgage on the precious metals in circulation. This list alone of the public fortune will suffice to dissipate the error of those who attribute to credit a creative power, whilst it only gives to one the disposal of what belongs to another without augmenting either its quantity or its power.
The enumeration of the income of all will be, perhaps, still more vague, but it may serve to dissipate some illusions.
Whether man dedicates his labour to agriculture or to the industrial arts, whether he makes land produce fruits or gives to those fruits a form more adapted to the use of man, he increases the value or the quantity of the materials on which he employs himself; he makes wealth by them, and this wealth is superior in value to the advances by means of which he obtained it. The superiority of the annual product of the labour of man over his annual advances, comprises all the income of the community; but this surplus value has two different valuations, according to the labour which it has cost, and according to the wants of those who use it.
When a family lives completely isolated, when, however numerous it may be, it is always directed by a common interest, which proportions the labours to the wants of each of its members, there is no work done without being demanded, without its destination being known. There is no money price, because there is as yet no exchange; and nevertheless the idea of income is more clearly developed than in our complicated societies, where the idea of giving a special security to the general interest is given up, and where individual interests contending with one another by means of exchanges, it is believed that the same end will be attained. In this isolated family, which we will suppose numerous, it is known that there will be required annually a determinate quantity of food, clothes, and furniture. The members of the family have already materials, provisions, and tools, the products of their former labours; some may be considered as capital which they have accumulated, such as corn for seed, the fleeces of which they mean to make cloth, the tools which they will use; others are the income of the preceding year, which they will consume whilst they are producing for the next—these are food and the clothes which they are wearing. The members of the family set to work; they divide their labours; some plough and sow, some prepare leather, some weave wool; they collect and finish all that it is necessary to provide for the coming year. In this provision we recognize three parts: one is capital—it is replacing those advances which had been made to agriculture or industry, the seed of the tiller, the wool and flax of the weaver: the other participates in the nature of capital and of income—it is the subsistence of the family during the year they have been at work, the food they have consumed, the clothes they have worn out; it was income as the produce of the preceding year; but as an accumulated product which must be in existence at the commencement of each year to recommence labour and to make it productive, it is capital. The last part is pure income; it is the material quantity of the product of this year over the preceding one, or the profit of labour.
It will he seen that, even in this most simple state of society, income has something in its nature mysterious and intangible; it is converted into capital; capital is consumed like income; it is the blood which nourishes the human body, which is converted into its substance, and which, notwithstanding, is continually renewed. In this state, however, some of the laws of the community are more clearly understood than when the complication is increased. It is acknowledged that the product of labour is more considerable, in proportion as the means of producing are perfected, as the machines are better; but it is also felt that all increase of production is not profitable. The wants of society are limited; all that cannot be consumed is useless. The quantity of food that a given number of individuals can eat is soon attained; thenceforward there would be a loss of labour in increasing it, and all the superfluity of labour bestowed on food must be employed in increasing its quality, not its quantity, in making food more wholesome, or more delicate. The quantity of clothes which a given number of individuals will require in a year is a little less precise; though the same dress may suffice for a year, it will be more agreeable to have a new one four times, eight times a year, so that the same dress only lasts six weeks, but we must stop there; all the clothes supplied beyond what are wanted, cost useless labour, without advantage to the community, without producing income. If the productive power goes on always increasing, by the increased perfection of skill and instruments, it soon arrives at a limit where it must cease to augment the quantity, and employ itself only in perfecting the quality. There is not one of the products of human industry to which the same rule does not apply. At the same time, the perfection of the quality has its limits; they are laid down by that labour itself which society is called on to perform; all the productions which can only be enjoyed by those who have leisure, are useless unless this leisure can be reserved.
Thus, there are limits prescribed to production which it cannot go beyond. It is only when contained within these limlts, that the redoubling of its power is an advantage. The quantity must be regulated by the number of the population, the quality by its leisure. Should man succeed in calling to his aid the highest sciences; should the progress of mechanics permit him to accomplish infinitely more work in infinitely less time, he must also longer suspend his productive powers; he must reserve much more leisure; for the most exquisite aliments, the most costly clothes, and all works highly perfected, are only used by persons of leisure.
Those rules which are understood and clearly seen in a family, however numerous it may be supposed to be, are equally true in every state of society, though it may not be directed by an intelligence which comprehends all the relations of its members with one another, by a will which makes them all concur in the common welfare. Individual interests have broken the bond which united them: men have been permitted, by the assistance of exchange and of money, each to satisfy his own wants apart from the rest, without caring for the public good; they are all found to be in opposition to one another; but philanthropists have found it easier to say and to believe that their reciprocal opposition restraining all, tends, by their combined action, as much to the advantage of all, as if it were really the object they had in view.
The interest of production is considered as independent of the interest of consumption; and this interest of production is divided among a great number of rival interests. Those who have in hand a certain quantity of accumulated wealth, have taken upon themselves in general the direction of annual production; they are divided into two classes, one guards the interests of agriculture, the other those of industry. They say to the landed proprietor, give to us up the use of your estate, of your buildings, of your improvements. We will direct all the labour, and out of what it produces we will reserve for you a portion always the same, rent of land or of houses: that will be your income. They say to the labourer, let us take the direction of your labour; we will collect the fruits of it; and before you could obtain them, we will pay you day by day, wages which we will take from our capital, and which will form your income; we will advance on our part new capital for different improvements; the product of your labour will be more considerable than if you directed it yourselves; but that will be our profit. Then comes the government and the church, who take from rent, wages, and profit, a new share, which they distribute as income to every class of public functionaries.
At the same time, other capitalists undertake the direction of industry; they secure wages to workmen, rent to the proprietors of mills and machines, interest to other capitalists who are content with lending their capital without wishing to give themselves any trouble; they pay taxes to government; they keep a profit for themselves: they are thus the distributors of an annual income to four or five classes of persons; but this income, whether obtained in the country or in towns, is never anything but the surplus of the value of what labour has produced above the advances that have been made to produce it.
Production would always be proportioned to demand, if labour were always performed in concert with the consumers. But the farther commerce extends, the more exchanges with foreign countries are multiplied, the more impossible it becomes for producers to measure exactly the wants of the markets for which they have to provide. Besides which, they care very little about it, and instead of asking whether their efforts will really increase the income of the community, each one labours to appropriate to himself the greatest share at the expense of others, and often the shortest way to do this is to diminish the portion of each.
The capitalist who undertakes any business, will certainly see his income increase, if the demand of the consumers for the products of his industry is increasing in the market which he supplies; but this increase, if it is common to the whole of society, is singularly slow and gradual. In order that there may be a greater demand for food, it is not alone necessary that there should be a great increase of births; for this circumstance by itself, being accompanied by an increase of expenses and a diminution of gains, the mass of the population will be worse fed, and the greater number of children will die in infancy; but there must be increased means, particularly for the poor; for food makes three quarters of the expenses of the poor, whilst it is scarcely a tenth part of the expenses of the rich. Increased means will prolong life among the poor, and more children will arrive at manhood. In countries where population has increased most rapidly, either by births or by longevity, it has never yet, except in colonies, been known to double itself in a century, though it has been calculated sometimes, that if it continued to increase at the rate of such or such a year, it would double itself in much less time. In general, in really prosperous countries, it does not increase in a sensible manner. Its progress is, however, the limit which agriculture ought to impose upon itself in the production of alimentary substances. Laying aside the oscillations of good and bad harvests which balance one another, the quantity of subsistence should not be increased more than a hundredth part in a year; for it is the most rapid rate at which population increases in Europe; and as each improvement in agriculture gives more considerable and rapid produce, each ought to be folked by abandoning those kinds of cultivation which give the greatest weight of alimentary substances; a certain number of fields of potatoes, for instance, to produce corn, fields of corn to produce flesh meat, or fermented liquors, fields cultivated for alimentary substances to produce flax, hemp, madder, raw materials for the industry of towns. It is, in fact, what is generally done, except that many substances cultivated at first for man have afterwards been appropriated to animals, which comes to the same result.
In detached districts which have little communication with their neighbours, the quantity of alimentary substances which can be consumed every year is sufficiently well known to the producer to prevent hie cultivating and throwing into the market a quantity of substances which cannot be sold; but when the farmer is near a large town, a seaport, a canal or a railway, or any market in fact whose extent he cannot calculate, he pays no attention to this. If he can, he doubles and redoubles his harvests, and calculates that he shall sell them by disposing of them at rather a lower price than other producers. To lower the price, he begins by endeavouring to diminish the income of those who compete with him in production, by giving less rent to the proprietor, less interest to those who have lent him money, less wages to his labourers, less taxes to government. By taking more corn to market than he could sell, he necessarily produces this effect, for the price of corn becomes lower, all the farmers make the same complaints to the proprietor, to the capitalist, to the labourer, to the government; rents diminish, interest becomes lower, wages are reduced.
He reacts at the same time on all other farmers. If his methods of cultivation are better, he can, with the same labour and the same advance, produce a greater quantity of food, and gain at a price at which others lose. Thus he continues to enrich himself whilst others are ruined. Then he wishes to take the farms of others with his own, end he finds capitalists who will facilitate his doing this; the trouble of inspection will not be doubled, though his undertaking is doubled; it answers better to get 4 percent on £20,000 than 5 per cent. on £ 10,000. Small farmers disappear, and nothing is seen but cultivation on a great scale.
Thus all incomes arising from land are diminished by this exaggerated production. The proprietor consents to lower his rent, the capitalist is content with 4, instead of 5 per cent, interest, the farmer with 4, instead of 5 per cent. profit, the labourer with 1s. a day wages instead of 2s. All are, however, consumers of commodities, and joined together they form themselves the great mass of consumers. The diminution of income will to every one of them be followed by a diminution of consumption, in quantity or quality ; the poor will give up meat for bread alone, or bread for potatoes. The effect on the rich will be more complicated; in consequence of the diminution of income, more capital will be required to live, more land to obtain the same rent, more money must be lent to get the same interest, larger farms to get as much profit; and as the rich pay great attention to keeping up their families, and not to make improvident marriages, the number of old rich families will decrease, as it does every generation, and consequently inheritanees will be more considerable. As a result of this, the consumption of the rich class, taken in a mass, will diminish, not only in proportion to the diminution of income, but also by the diminution of the number of persons. This double action is very apparent in England, though the number of reade open to fortune maintain probably a greater number of opulent families there than elsewhere. The total number of landed proprietors has there sensibly diminished, that of farmers has perhaps diminished still more. The quantity of corn, meat, and beer consumed must have diminished also; as to the day-labourers, they are gone back again from meat to bread, from bread to potatoes; their consumption has diminished in quantity and quality.
We have fixed our attention preferably on agricultural industry, because the relation between production and consumption is here most easily perceived; but exactly the same thing takes place in regard to the manufactured productions. Thus to produce a greater demand for clothes, it is not only requisite that there should be more births, but more ease in the circumstances of those who are to wear them; more income in every class of the nation, for all employ part of their income in dress. The increase of births may only increase the number of deaths, and make no difference in the consumption of any kind of wearing materials. The increase of vitality, by prolonging life after manhood is attained, a period when more is laid out in clothes, has a much more sensible effect. However, as we have seen, neither the multiplication of births, nor longevity, will double the population in a hundred years. Ease in their circumstances will increase more rapidly the consumption of clothes, and particularly among the poor. It is an advantage to health, to cleanliness, to enjoyment, to change the clothes frequently. The sultanas of the Great Mogul made it a point of honour to tear their dresses every evening that they might not wear them more than one day; perhaps some European women have thirty dresses in a year; their caprice may not extend to a consumption beyond this, but as a matter of health and cleanliness, an average of four new suits of dress a year is probably the highest term to which national consumption will attain. As soon as the manufacturers have produced this quantity of fabrics they cannot usefully go beyond it. Then they must fix their attention on the quality, and not on the quantity; they must vary the materials of their fabrics, their fineness, their elegance, and then at last they must stop; supernumerary hands must be employed in something else than in manufacturing articles of clothing, or they must perish for want. Now the increase of productions in manufactures is infinitely more rapid than in agriculture. Such a machine, with a given quantity of labour, doubles the products in a year; such another quadruples, even multiplies them ten-fold. The quantity of materials sufficient to dress every one has soon been produced; the limits to the improvement in quality, at least as far as regards working men, is also soon attained. Labour is incompatible with fine and elegant clothes; a workman looks upon duration as the most precious quality in his clothes; but this quality dispenses him from renewing them often, and diminishes his consumption; as to the substitution of cloth for serge, of cotton for wool, it is not an increase of consumption, it is often a diminution when the second costs less, and requires less labour than the first.
But the manufacturer, like the great farmer, within reach of a large town, does not know his market; he is lost in what is vague, he figures to himself buyers without number; or without caring for his rivals' losses, he thinks only of attracting his customers. He thinks himself a patriot when he ruins only a foreign manufacture by the development of his own industry; then he is vain of it; but indeed he has no more regard for those of his countrymen. All his labour, all his skill, consists in underselling; sometimes in substituting a more perfect, more expensive, but more productive machine, for those already in use; sometimes renting his buildings, obtaining capital at a lower rate, thus diminishing the income of the rich who are idle; sometimes lessening the wages of his workmen, and the income of the industrious poor; sometimes reducing the profits of his own business, which he can do profitably if he pursues it on a greater scale; sometimes attracting the taste of the consumers by offering them new productions, or by the invention of new fashions. Thus he increases his production by diminishing the incomes of capitalists, of the proprietors of mills, of his fellow-manufacturers, of himself, and in short of his workmen. To many this operation is fatal; when he raises what he manufactures from £ 5,000 to £50,000 annually, he destroys the nine manufacturers, his rivals, who with £ 5,000 each compoted with him; when he reduces the wages of his workmen, or obliges his rivals to dismiss theirs, he first causes the weakest among them and their children to perish for want, and then the greatest part of the rest. His prosperity is fatal to things as well as to men. His new manufacture, his new machinery, have made the old useless, which are ruined by his rivalry, and all the capital which had established them is annihilated. It is a loss of income to society by the diminution of interest of money, by the diminution of the profits of industry, by the loss of rent on all buildings, on all machines that are become useless, by the diminution of the total number of workmen, and of the wages of each. There is then diminution of consumption in all classes; and whilst the manufacturer exerts himself with all his power to increase the quantity and improve the quality of the fabrics which he has to sell, his exertions tend as actively and as efficaciously to diminish the number of purchasers of both quality and quantity, and to lead all those who are impoverished to make their clothes last longer, and to content themselves with coarser qualities.
We should fatigue the reader in vain by following this out in regard to the fabrication of the other products of industry, utensils, arms, furniture; everywhere we should find that consumption cannot go beyond a certain limit, difficult to trace, without doubt, but no less certain; that whenever production oversteps this limit, exuberant production, far from augmenting income, diminishes it, and that then the increase of material wealth, of apparent riches, produces throughout all society only straitened means and poverty.
We believe that by this analysis of the income of the community, we have sufficiently answered the difficulty which we have raised; we think we have made it understood how there may be too much, of even the best things. In effect, labour is a good thing; but too much labour may he offered, if it thus lowers wages, and if it consequently diminishes the income of the workman. Capital is a good thing, hut there may be too much capital, if that, and not the demand for consumption, excites production. Then, in effect, production is superior in value to the income which ought to purchase it; this disproportion lowers the value of all there is to sell, and consequently diminishes the incomes of all those who have something to sell; the proprietors of these incomes are, however, in their turn, consumers, and the loss which they have undergone will render them so much the more incapable of purchasing the production of the following year. Production in itself, in short, is a good thing, but there may be too much production, either by means of a superabundance of labour or of capital, or by the too powerful assistance which science has given to the useful arts; for when production has not been regulated by the desires of the consumers, and by their means of satisfying them, means which must be measured by income, production remains unsold and ruins the producers.
Another proposition results from what we have shown, and it contradicts the received doctrines: it is, that it is not true that the contest of individual interests suffices to produce the greatest good of all; but that as the prosperity of a family requires that in the mind of its head expenses should always be in proportion to income, and production be regulated by the wants of consumption, so in the administration of the fortune of the public, it is necessary that sovereign authority should watteh over and restrain particular interests to make them subservient to the general interest, that this authority should never lose sight of the formation and distribution of income, for it is income which spreads ease and prosperity throughout all classes; that this authority should especially take under its protection the poor and labouring class, for it is that class which is the least in a state to defend itself, which is more likely to be sacrificed to every other, and whose sufferings form the greatest national calamity; in short, that it is not the rapid increase of national wealth or income which sovereign authority ought to have in view, but its stability and equality; for the duration of an invariable proportion between population and income is always attended by general well-being, whilst whenever they are subject to variable chances, the unexpected opulence of some cannot be considered as a compensation for the ruin and miserable death of others.
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