will not learn this duty from the Christian teaching of their church, they must learn it from the stern exposition of the economist and the politician. Political economists have some of them wasted much time, and produced no little ennui, by unprofitable discussions on the definition of terms. These Mr Mill wisely spares us: an accurate writer, by a cautious use of ordinary expressions, will make his meaning more evident and precise than he will be able to do by any laboured definitions, or the introduction of purely technical terms. Such have been the discussions on the strict limits of the science of political economy, and the propriety of the title it has so long borne; whether intellectual efforts shall be classed amongst productive or unproductive labour, and the precise and invariable meaning to be given to such terms as wealth, value, and the like. These will generally be found to be unprofitable controversies, tending more to confusion of ideas than to precision of language. Let a writer think steadily and clearly upon his subject, and ordinary language will be faithful to him; distinctions between the several meanings of the same term will be made as they are wanted. He who begins by making such distinctions is only laying a snare for his own feet; he will hamper himself and perplex his reader. And with regard especially to the range of topics which an author thinks fit to embrace in his treatise upon this science, surely he may permit himself some liberty of choice, without resolving to mete out new boundaries to which all who follow him are to conform. If M. Dunoyer, for instance, in his able and, in many respects, valuable work, De la Liberté du Travail, chooses to write a treatise which embraces in fact the whole of human life, all the energies and activities of man, mental as well as physical, he could surely have done this without assailing old distinctions and old titles with so needless a

violence. Of what avail to call in the etymologist at this time of day, to determine the meaning, or criticise the application of so familiar a term as political economy ?*

But there is another class of discussions which, although to the general reader, who is mostly an impatient one, they will appear at first sight to be of a purely technical character, must not be so hastily dismissed. These will be often found to have a direct bearing on the most important questions that can occupy the mind of the statesman. They are in fact explanatory of that great machine, a commercial society, upon which he has to practise-which he has to keep in order, or to learn to leave aloneand therefore as necessary a branch of knowledge to him as anatomy or physiology to one who undertakes to medicine the body. Such are some of the intricate discussions which concern the nature of capital—a subject to which we shall in the first place and at once turn our attention. It is a subject which Mr Mill has treated throughout in a most masterly man

ner.

We may safely say, that there is now no other work to which a student could be properly directed for obtaining a complete insight into all the intricacies of this great branch of political economy. The exposition lies scattered, indeed, through the two volumes; he must read the entire work to obtain it. This scattering of the several parts of a subject is inevitable in treating such a science as political economy, where every topic has to be discussed in relation to every other topic. We do not think that Mr Mill has been particularly happy in his arrangement of topics, but, aware as we are of the extreme difficulty, under such circumstances, of making any arrangement at all, we forbear from any criticism. A man must write himself out the best way he can; and the reader, after obtaining all the materials put at his disposition, may pack them up in what

bundles may best suit his own convenience.

We must premise that on this subject-the nature and employment of capital-there appears to be in one part of Mr Mill's exposition-not an error --but a temporary forgetfulness of an old and familiar truth, which ought to have found its place there. Its very familiarity has occasioned it to be overlooked, in the keen inquiry after truth of a more recondite nature. The part which the economists call "unproductive consumption," the self-indulgent luxurious expenditure of the rich-the part this plays in a system of society based on individual effort and individual possession, is not fully stated.

He who spends his money, and lives to do little else, however idle he may be himself, has always had the consolation that he was, at least, setting other people to work. Mr Mill seems to deny him utterly this species of consolation; for in contending against a statement, made by political economists as well as others, that unproductive consumption is necessary, in a strictly economical sense, to the employment of the workmen, and as the indispensable relative to productive consumption, or capital spent in industrial pursuits, he has overlooked that moral necessity there is, in the present system of things, that there should be those who spend to enjoy, as well as those who lay out their money for profit. "What supports and employs productive labour," says Mr Mill, (vol. i. p. 97,) "is the capital expended in setting it to work, and not the demand of purchases for the produce of the labour when completed. Demand for commodities is not demand for labour. The demand for commodities determines in what particular branch of production the labour and capital shall be employed; it determines the direction of the labour, but not the more or less of the labour itself, or of the maintenance and payment of the labour. That depends on the amount of the capital, or other funds directly devoted to the sustenance and remuneration of labour." Now, without a doubt, the man who purchases an article of luxury when it is manufactured, does not employ labour in the same sense

as the manufacturer, who spends his wealth in supporting the artisan, and finding him the requisites of his art, and who, after selling the products of this industry, continues to spend the capital returned to him, together with the profit he has made, in the further sustenance of workmen. But it has been always understood, and the truth appears to be almost too trite to insist on, that unless the unproductive consumer were there to purchase, the capitalist would have had no motive to employ his wealth in this manner; and, what is of equal importance to bear in mind, unless the capitalist also calculated on being, some future day, an unproductive consumer himself, he would have no motive, by saving and toiling, to increase his wealth.

The necessity for a certain amount of unproductive consumption is not a necessity in the nature of things. All men might, if they chose, be saving, might spend upon themselves only what is needful for comfort, and set apart the residue of their funds for the employment of labour, not, of course, in the production of articles of luxury, for which there would be no purchasers, but for such articles as the labourers themselves, now paid from such ample stores, might be consumers of. The social machine might still go on under such a regime, and much to the benefit of the labourer. The capitalists would find their profits diminishing, it is true-they would be more rapidly approaching that minimum of profit, that stationary state, of which we shall by-and-by have to speak; but this diminution of profits must, at all events, sooner or later, take place, and depends ultimately, as we shall have occasion to show, on higher laws, over which man has no control. Men might, if they chose, be all saving, and all convert superfluous wealth into capital; but need we add, men would never choose any such thing. There is no necessity in the nature of things, but there is a necessity in the moral nature of man for a certain portion of this unproductive consumption. The good of others is not a motive sufficiently strong to stimulate a man to any of the steady pursuits of industry. When, therefore, his real wants are satisfied, it

must be the gratification of fictitious wants that induces him to toil and accumulate, or to part with any thing he has, by way of barter or exchange. From the time when the rude possessor of the soil consents to surrender a portion of his surplus produce for some trinket or piece of gaudy apparel, to the present epoch, when men consent to live frugally and toil hard during the first period of life, in order that they or their children may afterwards live idly, luxuriously, and ostentatiously, this same unproductive expenditure has performed the part of essential stimulant to human industry. It is not enough, therefore, to say, that it gives the direction to a certain portion of labour: it affords the stimulant that converts idleness into industry, and saving into capital. A very much more dignified being would man undoubtedly be, if desire for the general good could replace, as a motive of industry, a selfish desire, which is often no better than what we ridicule in the savage when he manifests a most disproportionate anxiety, as it seems to us, for the possession of glass beads, or a piece of painted calico. But to this point in the cultivation of human reason we have, at all events, not yet arrived. And let this be always borne in mind-in order that the class of society designated as unproductive consumers may not fall into unmerited odium-that others, who are using their wealth in the direct and profitable employment of labour, are themselves desirous, above all things, of taking their place in the class of unproductive consumers, and are working for that very end.

"Every one can see," writes Mr Mill, that if a benevolent government possessed all the food, and all the implements and materials of the community, it could exact productive labour from all to whom it allowed a share in the food, and could be in no danger of wanting a field for the employment of this productive labour, since, as long as there was a single want unsaturated (which material objects could supply) of any one individual, the labour of the community could be turned to the production of something capable of satisfying that

want.

Now, the individual possessors of capital, when they add to it

by fresh accumulations, are doing precisely the same thing which we suppose to be done by our benevolent government."—(Vol. i. p. 83.) Certainly the individual capitalists could do the same as the benevolent government, if they had its benevolence. If there are any political economists who teach otherwise, we hold them in error. We wish only to add to the statement the old moral truth long ago recognised, before political economy had a distinct place or name in the world, that as man is constituted, or rather, as he has hitherto demeaned himself, (for who knows what moral as well as other reformations may take place?-the civilised man, such as we have him at this day, postponing habitually the present enjoyment to the future, is a creature of cultivation; and who can tell but that advanced cultivation may make of man a being habitually acting for the general good, in which general good he finds his own particular interest sufficiently represented and provided for?)-that, as man has hitherto acted, this same unproductive selfish expenditure is indispensable as the motive to set that industry to work, which ultimately distributes the real necessaries and rational comforts of life to so many thousands.

Having, in justice to the class of unproductive consumers, brought out this homely truth, which, in the scientific exposition of Mr Mill, seemed in danger of being overlooked, we proceed to a branch of the subject which, if it appears at first of a very technical and abstruse description, is yet capable of very important applications. One of the most striking facts relating to the nature of capital is the tendency of profits, in wealthy and populous countries, to diminish as the amount of capital increases-a tendency to arrive at a certain minimum beyond which there would be no motive for saving, and little possibility of accumulating. This tendency Mr Mill explains as being the result, not of what has been somewhat vaguely called the competition of capital, over-production, or general glut in the market, but, in reality, of the physical laws of nature of the simple fact that the products of the soil cannot be indefinitely multiplied. Manufacturing in

to select what commodity they shall take in exchange, till some future time, postponing indefinitely the other half of the operation of barter, and seeking only for money, for that token which will give them or their children a claim on subsequent markets-do not bring with them a demand equivalent to their supply.

The answer to the objection lets us more fully into the real facts of the case. Those only who wished to sell their produce in order to hoard, would fall under the description of men who bring a present supply into the market, postponing indefinitely their demand. But the producer is almost always a man desirous of increasing his wealth-he does not hoard; he immediately lays out his capital in some productive manner, in the purchase of food for labourers, and of the raw materials of industry. But these articles, it happens, cannot be supplied to him with the increasing abundance he demands; and thus we fall back upon the ultimate law to which we have alluded. The manufacturer finds, that every additional demand he makes for these is supplied at a greater cost. What has limited the profits of the agricultural capitalist limits his profits also. He cannot sell his goods at the accustomed advantage. He exclaims that there is a glut in the market. What he takes for a glut is a deficiency. It is quite natural and permissible, how ever, that this phenomenon of the diminution of profits should be spoken of as the result of a superabundance of capital, provided only it be understood why the later accumulations of capital fail to bring the same return as the earlier.

A simple law of nature, therefore, is the true cause of this commercial phenomenon. Countries, after a certain progress in the career of wealth, must cease to accumulate ;-the diminished profit on capital affording no longer any motive for frugality and toil;. -and they arrive at what may be called the stationary state. "When a country," says Mr Mill, "has long possessed a large production, and a large net income to make savings from, and when, therefore, the means have long existed of making a great

VOL. LXIV.-NO. CCCXCVI.

annual addition to capital, (the country not having, like America, a large reserve of fertile land still unused,) it is one of the characteristics of such a country, that the rate of profit is habitually within, as it were, a hand's breadth of the minimum, and the country, therefore, on the very verge of the stationary state. By this, I do not mean that this state is likely, in any of the great countries of Europe, to be soon actually reached, or that capital does not still yield a profit considerably greater than what is barely sufficient to induce the people of these countries to save and accumulate. My meaning is, that it would require but a short time to reduce profits to the minimum, if capital continued to increase at its present rate, and no circumstances having a tendency to raise the rate of profit occurred in the mean time."-(Vol. ii. p. 287.)

Mr Mill then states what are the counteracting circumstances which arrest this downward tendency of profits. He mentions the waste of capital in periods of over-trading and rash speculation, the expenditure of an unproductive kind, and the perpetual overflow of capital into colonies and foreign countries, to seek higher profits than can be obtained at home. This last has a twofold operation. "In the first place, it does what a fire, or an inundation, or a commercial crisis, would have done, it carries off a part of the increase of capital from which the reduction of profits proceeds. Secondly, the capital so carried off is not lost, but is chiefly employed either in founding colonies, which become large exporters of cheap agricultural produce, or in extending, and perhaps improving, the agriculture of older communities. It is to the emigration of English capital that we have chiefly to look for keeping up a supply of cheap food and cheap materials of clothing, proportional to the increase of our population; thus enabling an increasing capital to find employment in the country, without reduction of profit, in producing manufactured articles with which to pay for this supply of raw produce. Thus, the exportation of capital is an agent of great efficacy in extending the field of

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