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for an answer, that, by so doing the American would raise the prices of domestic fabrics; for the Protectionist might concede this-which he would not-and yet reply that Mr. Mill deemed this no objection to restrictions upon competition in labour at home. We do not intend to say that such is the argument which an American Protectionist would offer, nor to express an opinion at present in regard to its force. The object is simply to show, into what inconsistencies the necessities of a false system may compel so acute and enlightened a writer as Mr. Mill, and to leave it to the reader to judge whether the doctrines of Malthus and Ricardo conduce to freedom of trade. The answer to Mr. Mill which the reader, who has thus far concurred in our reasoning, would make, is, "That the growth of population tends to raise wages, not to lower them—that the source of the evil is to be found, not in the free operation of the laws of our beneficent Creator, but in efforts to evade or thwart them—and the remedy to be sought, by conforming to those laws instead of intrenching against them.

The effect of improvements in machinery upon wages is a problem, which is solved, so far as the permanent results are concerned, by the considerations heretofore presented. Wages steadily rise with every increase in the aid contributed by the natural agents. It is doubtless true, that the immediate and temporary effect upon those whose toil is superseded by inanimate and gratuitous workers, is sometimes distressing. Until we have examined the subject of Exchange, we shall be unprepared to describe the process through which that distress is alleviated, new employment provided for those whom machinery may expel from their old, and the general benefit to com. munity finally apportioned so that a due share of it comes to them. - Previous to 1828, when planks were prepared for flooring by manual labour, a skilful and vigorous mechanic could prepare ten or fifteen planks, equal to one hundred feet, in a day, at a cost of $2. Woodworth's planing machine prepares 5000 feet in a day, at an expense of $10, doing the work of fifty men at one-tenth the cost. Fortyfive of the fifty are rendered disposable for other labour. Five are still required, to prepare materials for making the machine, to make it, to get fuel, &c., for running it, to tend it, &c.; for the whole cost of running the machinery may be resolved into the wages of present

labour, or of past labour, which needs renewal. It is evident that the body of purchasers of flooring could as well afford to maintain the forty-five carpenters in idleness, paying them $2 a day, as to dispense with the machine. They have among them $90 per day, their gross savings in the cost of flooring, which is quite likely to be expended in carpentry work; since the diminution of the cost of one considerable item in house-building, enables those to build who were before unable. If not, it is expended in maintaining labour in other departments of industry, to which the superseded carpenters may resort for employment; and then, when they become purchasers of flooring, they share in the common benefit, the saving of nine-tenths in the cost of its preparation. Defective social arrangements may protract the period, in which the adjustment of things to the new circumstances would otherwise be effected. If, for instance, the forty-five men skilled in the use of the plane, the chisel, and the saw, should be shut off from working at making doors, because the door-makers were endowed by the legislature with power to confine such employment to their own apprentices; or, if these were tolerated, in the absence of legislation, in combinations for the same purpose, upon the plea that they were simply "intrenching against the inroads of over-population"; in such case we should find that population had suddenly become excessive by forty-five surplus individuals, without a single additional birth, without a particle of diminution in the means of society to feed and clothe all its members; but, on the contrary, with a positive increase in the potential labour of fortyfive men, who, if they were slaves, would exchange in the market for at least 45,000 bushels of wheat, and as freemen are worth 90,000. If these men should be driven to the Poor-house, the followers of Malthus would accuse their ninety fathers and mothers of over-population; the men themselves might lay the crime at the door of Mr. Woodworth, the father of the planing machine: while we esteem them alike the benefactors of community the first, in furnishing the State with citizens capable of a thousand things besides shoving a plane-the second, for transferring to wood and iron the toil which formerly consumed human muscle. The only error is in a false dogma, and the mischievous arrangements it helps to perpetuate.

CHAPTER VI.

PROFITS.

WE have treated Profits and Wages as the shares of the Capitalist and the Labourer, in the product resulting from their combination. Each, in point of fact, contributes capital. The food of the preceding day, transformed into muscular and nervous fibre in the labourer's body, may be the whole of his part. It is a small one, and is expended in the course of a few hours; that is, is transformed, through the vital mechanism, into force, exerted upon the materials of the greater capitalist, and changing their form or location. It is necessary that it should be restored to him immediately, or his ability to exert force is exhausted; and it must be restored with some addition, bearing the same relation to the little capital that profits do to the greater, or the disposition to labour will fail, though the physical ability may continue. It is seldom, however, restored in kind. The employer of a slave, indeed, supplies him with food, raiment, and shelter; but the free labourer is ordinarily paid in money, which he transforms into materials for his physical renovation, at his own discretion. The money, moreover, from which the wages of a month or a week are paid, is not provided long in advance, but is supplied from day to day, by the sale of the commodities or the services in which the employer deals. The materials also undergo such transformations, as to prevent the direct comparison of their quantity with that of the product. Ore, limestone, coal-the grain, meat, &c., on which the labourer subsists, are virtually fused together, and run out of the furnace in the shape of a mass of iron, whose bulk and. weight are many times less than those of the elements whose utilities are incorporated in it. For such reasons, the comparison between the advances of the capitalist and the return, is made, not by their quantities, but by their relative value. In practice, it is the difference between the price of the advances and the return, by which the profits are estimated. For the short period usually intervening between the beginning and the end of an industrial enterprise, value

and price may generally be regarded as identical, or at least as differing by the same proportion at the two dates. In either case, the ratio between the price of the advance and that of the returns, will correspond with that of their values, and enable the capitalist to express his loss or gain, by the aliquot part that the deficiency or excess constitutes of the original capital. He computes that he has made or lost, as the case may be, three, six, or ten per cent. As his wants, like those of the labourer, vary with the seasons, but recur each year, and as the element of time enters into every calculation of profit—because the frequency with which operations can be repeated determines the gross amount of gain that can be realized-it is usual to denote the growth of capital by the per centage added to it in a year.

To an individual, the increase in the value of his capital, not in its quantity, is the point of vital concern. If he produced for the purpose of consuming in his own person and in his family the iden. tical commodities which he produces, the annual addition to their quantity would determine his means of enjoyment. This supposition is true, however, only of the savage. Men in civilized countries produce for the sake of exchanging the products of their industry with each other. The man who makes ploughs does not use them to prepare the earth for raising his own food, and may never turn a furrow in his life. The men who grow corn eat but a small portion of their crop, and exchange the remainder for agricultural implements, for clothing, for books, &c. Each one, therefore, measures his progress in the year by the command which the increment to his capital-his profits-gives him over the labour of others, either in their future services, or as embodied in commodities vices already in the shape in which he desires them; in other words, by the value of his profits.

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The capital of a society is the same as that of all the individuals who compose it. The aggregate of the additions which each has made to his capital, is the increase of the capital of the nation. It is natural enough, therefore, to jump to the conclusion, that the progress of a community in wealth is measured by the prevailing rate of profit; that when its citizens find by their annual balancesheets that they are gaining six per cent. upon their capitals, the

nation is accumulating capital twice as fast as when they gain but three per cent., and producing twice as much of the materials on which the physical comfort of its people depends. There is a fallacy in this conclusion, which lurks in the reasoning of many Economical writers, though not always distinctly expressed in their language, and which has infected the policy of nations. "To transfer," says Mr. Mill, "hastily and inconsiderately to the general point of view, propositions which are true of the individual, has been a source of innumerable errors in Political Economy." In another place he writes, "With Mr. M'Culloch, prosperity does not mean a large production and a good distribution of wealth, but a rapid increase of it; his test of prosperity is high profits." We cite this passage, not merely because it is an instance of the error to which we refer, in Mr. M'Culloch, but as showing it to be at least doubtful whether Mr. Mill himself does not regard high profits as the evidence of a rapid increase in national capital.

The fact which is overlooked in the hasty deduction, which measures the advance of national capital by the rate of profit, as individuals compute it, is, that while the individual does not personally consume his own products, the nation does consume the products of the industry and capital of its people. It is doubtless true, that some portion of the products of its domestic industry is exported, to be consumed abroad. This, however, instead of being a large, is a very small proportion of the commodities annually brought to market. The great mass of the exchanges effected by every nation, are made within their own borders, and its exports are of trifling amount compared with its internal consumption. The exports of the United States constitute but about five per cent. in value of their annual production; those of England, the greatest exporting nation in the world, are ordinarily below one-tenth of the products of its industry. The prosperity of its people is measured, not by the value, but by the quantity of the annual increment to its capital. In the year preceding the census of 1850, there were produced in the United States, 592,141,230 bushels of Indian corn, and 100,479,150 bushels of wheat. In the same year, 7,632,860 bushels, in corn and meal, and 7,535,901 bushels, in wheat and flour, were exported. An individual wheat-grower is indifferent

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