money with which they are to pay for the English produce. You perceive, Sir, that to acquire foreign produce, a nation must, like an individual, have recourse to its own productions.

It is said that the English sell at a loss in those places which they inundate with their merchandize. This I believe to be true: they multiply the goods offered, which depreciates them; and they demand in return, as far as it is practicable, money only, which there fore becomes more rare and valuable. Being thus enhanced in value, money is given in smaller quantities in every exchange thus are people obliged to sell at a loss. But suppose for an instant that the Italians possessed more capital, that they employed their lands and their industrious faculties to greater advantage, in short that their produce were greater; and suppose, at the same time, that the English laws, instead of having been modelled upon the absurd principles of the balance of trade, had admitted on moderate terms all that the Italians had been capable of furnishing in payment for the English productions; can you doubt that the English merchandize which incumbers the ports of Italy, and great quantities of other merchandize besides, would have been disposed of with facility?

Brazil, that vast country so favoured by nature, would be able to absorb a hundred times as much English merchandize as is now vainly sent there without finding a market; but it would first be requisite that Brazil should produce all that it is capable of producing; and how is that wretched country to attain that desirable object? All the efforts of the citizens are paralyzed by the government. If any branch of industry offers there the prospect of gain, it is instantly seized and stifled by the hand of power. Does any one find a precious stone? it is taken from him. Fine encouragement this to exert productive industry for the purpose of buying with its produce European merchandize!

The English government contributes to the injury of its commerce by repelling, by means of its customs and import duties, the produce which the English might obtain by their exchanges with foreigners; even the articles of food of which their manufacturers stand so much in need; and this because it is necessary that the English farmers should sell their corn at more than 80s, the quarter, to enable them to pay extravagant taxes. All these nations complain of a state of

suffering into which they have been brought by their own fault, like diseased persons who bewail their maladies, and at the same time obstinately refuse to abandon the excesses which have caused them.

I know that it is not so easy to uproot an oak as to pull up a weed; I know that it is not easy to overturn old fences however rotten, when they are supported by the heaps of filth which have accumulated beneath their shelter; I know that certain governments, corrupted and corrupting, stand in need of monopolies, and of the money arising from the customs, to pay for the votes of the honourable majorities which pretend to represent nations: I am not so unjust as to wish them to govern according to the general interest, in order to secure all suffrages gratuitously; but, at the same time, why should I be astonished that such vicious systems produce deplorable effects?

You will, I presume, readily agree with me, as to the injuries which nations mutually sustain from their jealousies of each other, from the sordid interest or the inexperience of those who take upon themselves to be their organs; but you maintain, that even supposing they possessed more liberal institutions, the goods produced might exceed the wants of the consumers. Well, Sir, on this ground I am willing to rest my defence. Let us leave out of the question the war which exists between nations and the ministers of their revenue laws; let us consider each nation in its relations with itself; and let us inquire, once for all, whether we have not the means of consuming what we have the means of producing.

M. Say, M. Mill, and M. Ricardo," you say, "the principal authors of the new doctrine of profits, seem to me to have fallen into fundamental errors on this subject. In the first place they have considered commodities as if they were algebraic signs, instead of articles of consumption, which ought necessarily to be proportioned to the number of the consumers and the nature of their wants *.”

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I know not, Sir, at least so far as I am concerned, upon what foundation you have built this assertion. I have repeated, in a great variety of forms, this idea, that the value of things (the only quality by which they become

* Malthus' "Principles of Political Economy," p. 354. uron d'b mil

1820.]

wealth) is founded on their utility; on their aptitude to the supply of our occa sions."The want of various articles," I have said, "depends on the physical and moral nature of man; on the cli mate which he inhabits, and the manners and laws of his country. He is subject to bodily wants, to mental and spiritual wants; some things are need ful to him on his own account, others for his family; and others he requires as a member of society. A bear-skin and a rein-deer are to a Laplander objects of the first necessity; whilst the very names of them are wholly unknown to a lazzarone of Naples. The latter, for his part, can dispense with every other thing, if he is plentifully supplied with macaroni. In like manner the courts of justice in Europe are considered the strongest bonds of civil society; while the natives of America, the Arabs, and the Tartars, do very well without them. Of these wants, some are satisfied by the use which we make of certain things with which nature furnishes us gratuitously; as air, water, and the light of the sun. We may call these things natural riches, because they are supplied at the expense of Nature alone. Since she GIVES them to ALL, nobody is obliged to purchase them at the price of any sacrifice whatever. They have therefore no exchangeable value.

Other wants can only be satisfied by the use which we make of certain things to which their utility could not have been given, without subjecting them to a modification, without operating a change in their condition; without having for this purpose surmounted a difficulty of some kind. Such are the various goods which we can only obtain by some process of agriculture, commerce, or the arts; and these only have an exchangeable value. The reason of this is evident they are, by the mere fact of their production, the result of a change, in which the producer has given his productive services, in order to receive this product. They cannot therefore be obtained from him, except by virtue of another exchange, in which some other product is given to him, which he may consider of equal value with his own."

:

These things may therefore be called social riches, because no exchange can take place without a social relation, and because it is only in a state of society

* Traité d'Economie Politique, &c, 4to edition, tom. II. p. 5.

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that the right of possessing exclusively what has been obtained by production or exchange, can be guaranteed.

"Let us observe at the same time, that social riches are, so far forth as riches, the only ones which can become the object of scientific study; first, because they are the only ones which can be appreciated, or at least the only ones of which the appreciation is not arbitrary; and, secondly, because they alone are formed, distributed, and destroyed, according to laws which we are able to assign."

Is this to consider produce as algebraic signs, by abstracting the number of consumers and the nature of their wants? On the contrary, does not this doctrine establish that our wants alone induce us to make sacrifices by means whereof we obtain produce? These sacrifices are the price which we pay to procure that produce; you, like Smith, call these sacrifices by the name of lubour, an insufficient expression, for they are partly composed of the use derived from land and capital. I call them productive services. They have everywhere a current price. When that price exceeds the value of the thing produced, the result is a disadvantageous exchange, in which the value consumed is greater than the value created. When a produce has been created equal to the value of the services employed, those services are paid by the produce, the value of which, distributed among the producers, forms their revenues. You see that the existence of these revenues depends upon the exchangeable value of the produce, which can only have such value in consequence of the necessity for such produce existing in the actual state of society. Therefore I do not abstract this necessity, or give it an arbitrary appreciation; I take it for what it is, for what the consumers make it to be. I could have cited, had it been necessary, the whole of my third book, which details the different modes, motives, and results of consumption, but I will not trifle with your time or attention :-let us proceed.

You say, It is by no means true that commodities are always exchanged for commodities. The greater part of commodities is directly exchanged for labour productive or non-productive; and it is evident that this whole mass of commodities, compared with the labour for which it is exchanged, may fall in value through its superabundance, as well as any particular commodity may,

through its superabundance, fall, in value with relation to labour or money.", Permit me to remark, in the first place, that I never said commodities are always exchanged for commodities; but that produce is only purchased with produce.

Secondly, that even those who admit this expression of commodities might answer you, that when commodities are given in exchange for labour, these commodities are in reality given in exchange for other commodities, that is to say, for those which result from the labour which has been purchased. But this answer is insufficient for those who embrace in a more extended and complete view, the phenomenon of the production of our riches. Allow me to place it before your eyes in a striking form. The public, which is to judge between us, will, I think, be thus materially assisted in appreciating your objections and my answers.

To obtain a better view of the operations of industry, capital, and land, in the work of production, I personify them and I discover that all these personages sell their labours, which I call productive services, to an undertaker, who may be either a trader, a manufacturer, or a farmer. This undertaker having purchased the services of a landed estate, by paying a rent to the proprietor of the land, the services of a capital by paying interest to the capitalist, and the industrious services of workmen, factors, agents of whatever description, by the payment of salaries, consumes and uses all these productive services, and out of this consumption results a valuable produce.

The value of this produce, provided it be equal to the costs of production, that is to say, to the sums necessarily advanced for all the requisite productive services, suffices to pay the profits of all those who have concurred directly or indirectly in this production. The profit of the undertaker on whose account this operation has been effected, deducting the interest of the capital which he may have employed, represents the remuneration for his time and talents, that is to say, his own productive ser vices employed in his own behalf. If his abilities be great and his calculations well made, his profit will be considerable. If instead of talent he evinces inexperience in his affairs, he may gain nothing; he may very probably be a loser. All the risks attach to the undertaker; but on the other hand he

takes the advantage of all the favourable chances.

All the produce which we daily see, all that which our imagination can conceive, has been formed by operations which resolve themselves without exception into those which I have described, but combined in an infinity of different manners. What some undertakers do for one sort of produce, others perform for another sort. Now the interchange of these articles is what constitutes a market for each. The greater or less need that exists for one of these kinds of produce compared with the others determines the greater or less price which is given to obtain it, that is to say, the greater or less quantity of any other produce. Money is in these transactions only a transient agent, which, when once the exchange is com pleted, is no farther concerned in it, and flies to effect other exchanges.

It is with rent, interest, and wages, forming the profits resulting from this production, that the producers buy the objects of their consumption. These producers are at the same time consumers; and the nature of their wants, influencing in different degrees the demand for different kinds of produce, is always favourable, where liberty exists, to the most necessary kind of produc tion; because that, being the most in demand, affords to those who undertake it the greatest profits. I said that in order to see how industry, capital, and land respectively act in productive operations, I personified them, and observed them in the services they rendered. But this is not a gratuitous fiction; it is a fact. Industry is represented by the industrious of all classes'; capital, by capitalists; land, by its proprietors. These are the three orders of persons who sell the productive action of the instrument they possess, and stipulate the remuneration for its employment. My expressions may perhaps be censured; but it will then be incumbent on those who find fault with them, to propose better, for it is impossible to deny that this is the course of the transactions. The manner of the painter may be criticized, but the facts represented defy contradiction; there they are, and they will defend themselves.

To return to your accusation. You say, Sir, that many commodities are purchased with labour; and I go farther than you: I say, they are all purchased with labour, extending that expression

say

other

land. chased by value and result in all cases from such services; and that the alternative is thus presented to us, either of consuming, ourselves, the utility and consequently the value which we have produced; or of employing it in the purchase of the utility and value produced by others; that in both cases we purchase commodities with productive services, and that the more productive services we carry to market, the more we can buy in return.

You assert that there is no such thing as immaterial produce.† Why, Sir, originally there is no other. A field, for instance, furnishes towards production only its service, which is an immaterial product. It serves as a crucible into which you put a mineral, and extract metal and dross. Is there any part of the crucible in these products? No; the crucible serves for a new productive operation. Is there any portion of the field in the harvest which is obtained from it? I answer likewise No; for if land were thus gradually consumed, it would cease to exist in a few years: the land only returns what is put into it; but returns it after an elaboration which I call the productive service of the field. Possibly some people may quibble on the word; I do not apprehend any quibbles that may be attempted as to the thing, because that is undeniable, and wherever political economy shall be studied, will be acknowledged as the fact, whatever name people may think proper to give it.

The service rendered by capital in any undertaking whatever, commercial, agricultural, or manufactoral, is likewise an immaterial product. He who consumes a capital unproductively destroys the capital itself, he who consumes it reproductively, consumes the material capital, and also the service of that capital, which is an immaterial product, When a dyer puts indigo, to the value of a thousand francs, into his copper, he consumes material produce worth a thousand francs; and, besides, he consumes the time of this capital, its interest. The dye which he obtains,

The English authors are often obscure through their confounding, like Smith, un der the denomination of labour, the services Tendered by men, by capital, and by land, Page 49.**

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capital. The service of the workman is likewise an immaterial product. The workman comes out of the manufactory at night with as many fingers as he carried into it in the morning. He has left nothing material in the workshop. It is then an immaterial service which he has furnished towards the productive operation. This service is the daily or annual produce of a fund or estate which I call his industrious faculties, and which composes his wealth: a sorry wealth! particularly in England; and I know the reason.

These form immaterial produce, which, however it may be called, will still be immaterial productions, exchangeable mutually one with another, exchangeable for material productions; and which, in all exchanges, will still seek their market-price, founded, like every market-price in the world, upon the proportion between the supply and demand.

These services, of industry, capital, and land, which are products indepen dent of all matter, form all our revenues, whosoever we may be. What! are all our revenues immaterial? Yes, Sir, ALL: otherwise the mass of matter which composes the globe must increase every year, because every year we should have new material revenues. We neither create nor destroy a single atom: all that we do is to change the combina tions of things; and all that we contribute to it is immaterial. It is VALUES and it is this value which is immaterial that we daily, annually consume, and upon which we live; for consumption is a change of form given to matter, or, if you prefer the expression, a derangement of form, as production is an arrangement. If you find a paradoxical appearance in these propositions, examine the things which they express, and I have no doubt they will appear very simple and reasonable.

Without this analysis, I defy you to explain the whole of the facts; for instance, how the same capital is twice consumed; productively by an under taker, and unproductively by his workman. By means of the foregoing analysis, it may be seen how the workman brings to market his labour, the fruits of his ability; he sells it to the master, carries home with him his wages, and consumes it unproductively. But the VOL. XIV.

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master who has bought the labour of the workman with a part of his capital, consumes it reproductively, as the dyer consumes reproductively the indigo thrown into his copper. These values having been consumed reproductively, re-appear in the produce which comes out of the hands of the master. It is not the capital of the master which forms the revenue of the workman, as M. Sismondi asserts. The capital of the master is consumed in the workshops, and not in the dwelling of the workman. The value consumed by the latter has another source; it is the produce of his industrious faculties. The master devotes to the purchase of the workman's labour a part of his capital. Having purchased it, he consumes it; and the workman consumes, on his part, the value which he has obtained in exchange for his labour. Wherever there is exchange, there are two values bartered one for the other; and wherever two values are exchanged, there must be, and there are in effect, two consumptions*.

It is the same with the productive service rendered by capital. The capitalist who lends, sells the service, the labour of his instrument; the daily or annual hire which an undertaker pays him for it is called interest. The terms of the exchange are, on one side, the service of the capital, on the other the interest. The undertaker, while he consumes reproductively the capital, also consumes reproductively the service of the capital. The lender, who has sold the service of the capital, consumes the interest unproductively,

which is a material value given in exchange for the immaterial service of the capital. Ought we to wonder that there should be a double consumption, that of the undertaker to make his produce, and that of the capitalist to satisfy his wants, since there are two terms to the exchange, two values drawn from two different funds, bartered for each other, and both capable of consumption?

You say, Sir, that the distinction between productive and unproductive labour is the corner stone of Adam Smith's work; that to recognise as productive, labours which are not fixed in any material object (as I do) is to overturn that work from top to bottom.† No, Sir; that is not the corner-stone of Smith's work; for when that stone is removed, the edifice, although imperfect, remains as solid as before. What will eternally sustain that excellent book is, that it proclaims in every page that the exchangeable value of things is the foundation of all riches. From the publication of that important truth political economy became a positive science; for the market-price of every thing is a determinate quantity of which the elements may be analysed, the causes assigned, the relations studied, and the consequences foreseen. Permit me, Sir, to say, that to separate this essential character from the definition of wealth, is to plunge science again into the depths of obscurity; to drive it back.

Instead of weakening the authority of the celebrated Inquiry into the Wealth of Nations, I support it in the most essential part; but at the same time I think Adam Smith has erroneously re