a resource of great power is brought up to complete the conversion. A metaphor is fetched up from common life. Incorporeal property is wealth, for it represents wealth. Under the cover of this figure of speech the underlying absurdity is concealed. Does not a tradesman in taking account of stock, set down his shop debts as well as his goods, as representing so much money? If the debts are good, are they not the same as money? So in bankruptcy assets are constantly described as representing so much cash. The incorporeal property theorists quote these facts triumphantly, and waive all further discussion. Every science must have terms of its own, and "represent" is the scientific economical term. What more is needed to prove the doctrine? The puzzled hearer may be inclined to think that he is mystified with a second phrase wonderfully like the dictum that "incorporeal property is wealth." A representative is the thing represented; a counter or ticket which stands for a sovereign is the sovereign itself. The member who represents a county is the county itself. Can we feel surprised that writings on Political Economy are increasing in discredit, that they wield diminished authority over that practical world for whose good alone Political Economy exists? There is another widely-spread fallacy which has come forth from the same nest. Credit is wealth exclaims a multitude of speakers and writers. Nothing can be more untrue. Wealth is a substance. Even skill, which is justly regarded as wealth, is conceived as embodied in a substance, as a part of a working machine, the man that labours. But credit is not a substance at all. It is an abstract term, denoting a mode of acting. It is a particular way of acquiring property, nothing more. No one has ever called buying or lending wealth; they are simply different ways of procuring the things termed wealth. Credit is a species of which buying is the genus. Buying is the complete, credit the incomplete transaction. Buying effects the exchange wholly, by giving money for goods. Credit leaves one half undone, takes away the property and gives the equivalent for it, the payment, at a later time. This mode of buying is said to be performed on credit, because it is founded on trust or belief. But though credit is not wealth, as an abstraction cannot be a substance, the method of purchasing designated by credit is highly instrumental in the production of wealth. Banking is a mode of employing the process of credit, and few inventions, if indeed any, do so much for the increase of wealth as banking. But banking no one calls wealth, though everyone knows that it is a great creator of riches. It places a large part of the capital of the nation in the hands of those who can work it with the greatest efficiency. The result is a mighty augmentation of the wealth made. Banking is a mode of doing business, and no one astonishes his neighbours by calling banking actual wealth. But in respect of credit, the phrase 'credit is wealth' finds favour with many writers precisely on account of the scientific, or rather, the vague sound of the expression. They forget to how many ears it has the sound of jargon, and how sadly it repels men from Political Economy as dealing in language unintelligible to the every-day world. An interesting question has been raised in respect of the range of the word wealth, on which it is desirable to make a few remarks. Is a skilled labourer a part of the nation's wealth? Mr Mill is unwilling to permit the people of a country to be accounted a portion of its wealth. They are that for the sake of which its wealth exists. But he allows skill to be wealth. "It has as much right to the title when attached to a man as when attached to a coalpit or a factory." The distinction is fanciful. The skill of the workman helps to make wealth, but so also do his sinews, as the sinews and the man, in this relation, are not distinguishable. A trained horse ranks as wealth, but so also does the young vigorous horse before he is put into training. If skill is acknowledged to be wealth, it cannot be separated from the workman in whom it is embodied, for skill is only knowledge how to use his hands. But we must go further still. I hold, against Mr Mill's limitation, that the qualities of a people, their moral, intellectual, and physical natures, are parts of their wealth. What men are is a force of enormous power in determining the amount of the wealth they create. The emancipated negroes of Jamaica and of the United States would not labour for more than mere necessaries. They do not care to be wealthy and are not. The Chinese are a great wealth-producing people as a consequence of their character. Their neighbours and kinsmen, the Tatars, are not. The difference lies in the moral temper of every people. Europe lately exhibited a splendid example of the power of character in the creating of wealth. France astonished the world by a recovery from a devastating war, and a crushing penalty of 220 millions of pounds sterling at its close. Her revival astonished and alarmed her conquerors. And to what was this splendid restoration due? To the temper and character of the French peasant, to his inveterate love of thrift, to his resolute determination to meet losses by curtailed expenditure and by saving. Is not such a quality of soul as truly an economical force, as real a wealth-making machine as a factory or a fertile soil? But then, it will be said, we must give up all hope of a scientific definition of wealth. We must; and, as shown above, this is no loss to Political Economy. As Mr Mill confesses, the popular notion of wealth suffices. CHAPTER II. VALUE. I PROPOSE, thus early, to speak of Value. It is a word of the widest range; indeed it may be said to pervade the whole of Political Economy. It is met with everywhere, in the production and distribution of wealth, in wages and profits, in every form of exchange. Its power is felt all through the economical life of mankind. It is a matter of supreme importance to obtain a right understanding of its meaning. There is one word, marks and circum All systematic writers on Political Economy have recognised the great significance of this word, and all, it may be said, have occupied themselves in answering the question, What is value? says Professor Perry, that scribes the field of Political Economy, that word is value. In proportion as an economist is able and eminent does he make vigorous efforts to discover a true and satisfactory answer, but the question has all along been found to be most formidable." "The question is fundamental," remarks Mr Mill. "Almost every speculation respecting the economical interests of a society thus constituted (that is, constituted on the necessity of exchanging products obtained by the labour of another) implies some theory of value. The smallest error on that subject infects |
