Importance of capital to the profitable employment of labour—Contrast between the prodigal and the prudent man: the Dukes of Buckingham and Bridgewater—Making good for trade—Unprofitable consumption—War against capital in the middle ages—Evils of corporate privileges—Condition of the people under Henry VIII.

If we have succeeded in making our meaning clear, by stating a general truth, not in an abstract form, but as brought out by various instances of the modes in which it is exhibited, we shall have led the reader to the conclusion that accumulation, or capital, is absolutely essential to the profitable employment of labour; and that the greater the accumulation the greater the extent of that profitable employment. This truth, however, has been denied altogether by some speculative writers;—and, what is more important, has been practically denied by the conduct of nations and individuals in the earlier state of society,—and is still denied by existing prejudices, derived from the current maxims of former days of ignorance and half-knowledge. With the speculative writers we have little to do. When Rousseau, for instance, advises governments not to secure property to its possessors, but to deprive them of all means of accumulating, it is sufficient to know that the same writer advocated the savage state, in which there should be no property, in preference to the social, which is founded on appropriation. Knowing this, and being convinced that the savage state, even with imperfect appropriation, is one of extreme wretchedness, we may safely leave such opinions to work their own cure. For it is not likely that any individual, however disposed to think that accumulation is an evil, would desire, by destroying accumulation, to pass into the condition, described by John Tanner, of a constant encounter with hunger in its most terrific forms: and seeing, therefore, the fallacy of such an opinion, he will also see that, if he partially destroys accumulation, he equally impedes production, and equally destroys his share in the productive power of capital and labour working together for a common good in the social state.

But, without going the length of wishing to destroy capital, there are many who think that accumulation is a positive evil, and that consumption is a positive benefit; and, therefore, that economy is an evil, and waste a benefit. The course of a prodigal man is by many still viewed with considerable admiration. He sits up all night in frantic riot—he consumes whatever can stimulate his satiated appetite—he is waited upon by a crowd of unproductive and equally riotous retainers—he breaks and destroys everything around him with an unsparing hand—he rides his horses to death in the most extravagant attempts to wrestle with time and space; and when he has spent all his substance in these excesses, and dies an outcast and a beggar, he is said to have been a hearty fellow, and to have "made good for trade." When, on the contrary, a man of fortune economizes his revenue—lives like a virtuous and reasonable being, whose first duty is the cultivation of his understanding—eats and drinks with regard to his health—keeps no more retainers than are sufficient for his proper comfort and decency—breaks and destroys nothing—has respect to the inferior animals, as well from motives of prudence as of mercy—and dies without a mortgage on his lands; he is said to have been a stingy fellow who did not know how to "circulate his money." To "circulate money," to "make good for trade," in the once common meaning of the terms, is for one to consume unprofitably what, if economized, would have stimulated production in a way that would have enabled hundreds, instead of one, to consume profitably. Let us offer two historical examples of these two opposite modes of making good for trade, and circulating money. The Duke of Buckingham, "having been possessed of about 50,000l. a year, died in 1687, in a remote inn in Yorkshire, reduced to the utmost misery."[12] After a life of the most wanton riot, which exhausted all his princely resources, he was left at the last hour, under circumstances which are well described in the following lines by Pope:—

Contrast the course of this unhappy man with that of the Duke of Bridgewater, who devoted his property to really "making good for trade," by constructing the great canals which connect Manchester with the coal countries and with Liverpool. The Duke of Buckingham lived in a round of sensual folly: the Duke of Bridgewater limited his personal expenditure to 400l. a-year, and devoted all the remaining portion of his revenues to the construction of a magnificent work of the highest public utility. The one supported a train of cooks and valets and horse-jockeys: the other called into action the labour of thousands, and employed in the direction of that labour the skill of Brindley, one of the greatest engineers that any country has produced. The one died without a penny, loaded with debt, leaving no trace behind him but the ruin which his waste had produced: the other bequeathed almost the largest property in Europe to his descendants, and opened a channel for industry which afforded, and still affords, employment to thousands.

When a mob amused themselves by breaking windows, as was once a common recreation on an illumination night, by way of showing the amount of popular intelligence, some were apt to say they have "made good for trade." Is it not evident that the capital which was represented by the unbroken windows was really so much destroyed of the national riches when the windows were broken?—for if the windows had remained unbroken, the capital would have remained to stimulate the production of some new object of utility. The glaziers, indeed, replaced the windows; but there having been a destruction of windows, there must have been a necessary retrenchment in some other outlay, that would have afforded benefit to the consumer. Doubtless, when the glazier is called into activity by a mob breaking windows, some other trade suffers; for the man who has to pay for the broken windows must retrench somewhere, and, if he has less to lay out, some other person has less to lay out. The glass-maker, probably, makes more glass at the moment; but he does so to exchange with the capital that would otherwise have gone to the maker of clothes or of furniture: and, there being an absolute destruction of the funds for the maintenance of labour, by an unnecessary destruction of what former labour has produced, trade generally is injured to the extent of the destruction. Some now say that a fire makes good for trade. The only difference of evil between the fire which destroys a house, and the mob which breaks the windows, is, that the fire absorbs capital for the maintenance of trade, or labour, in the proportion of a hundred to one when compared with the mob. Some say that war makes good for trade. The only difference of pecuniary evil (the moral evils admit of no comparison) between the fire and the war is, that the war absorbs capital for the maintenance of trade, or labour, in the proportion of a million to a hundred when compared with the fire. If the incessant energy of production were constantly repressed by mobs, and fires, and wars, the end would be that consumption would altogether exceed production; and that then the producers and the consumers would both be starved into wiser courses, and perceive that nothing makes good for trade but profitable industry and judicious expenditure. Prodigality devotes itself too much to the satisfaction of present wants: avarice postpones too much the present wants to the possible wants of the future. Real economy is the happy measure between the two extremes; and that only "makes good for trade," because, while it carries on a steady demand for industry, it accumulates a portion of the production of a country to stimulate new production. That judicious expenditure consists in

The fashion of "making good for trade" by unprofitable consumption is a relic of the barbarous ages. In the twelfth century a count of France commanded his vassals to plough up the soil round his castle, and he sowed the ground with coins of gold, to the amount of fifteen hundred guineas, that he might have all men talk of his magnificence. Piqued at the lordly prodigality of his neighbour, another noble ordered thirty of his most valuable horses to be tied to a stake and burnt alive, that he might exhibit a more striking instance of contempt for accumulation. In the latter part of the fourteenth century, a Scotch noble, Colin Campbell, on receiving a visit from the O'Neiles of Ireland, ostentatiously burnt down his house at Inverary upon their departure; and an Earl of Athol pursued the same course in 1528, after having entertained the papal legate, upon the pretence that it was "the constant habitude of the high-landers to set on fire in the morning the place which had lodged them the night before." When the feudal lords had so little respect for their own property, it was not likely that they would have much regard for the accumulation of others. The Jews, who were the great capitalists of the middle ages, and who really merit the gratitude of Europeans for their avarice, as that almost alone enabled any accumulation to go forward, and any production to increase, were, as it is well known, persecuted in every direction by the crown, by the nobles, by the people. When a solitary farmer or abbot attempted to accumulate corn, which accumulation could alone prevent the dreadful famines invariably resulting from having no stock that might be available upon a bad harvest, the people burnt the ricks of the provident men, by way of lessening the evils of scarcity. The consequence was, that no person thought of accumulating at all, and that the price of wheat often rose, just before the harvest, from five shillings a quarter to five pounds.

We are accustomed to read and talk of "merry England," but we sometimes fail to think how much real suffering lay beneath the surface of the merriment. Herrick, one of our charming old lyric poets, has sung the glories of the hock-cart—the cart that bore the full sheaves to the empty barn:—

Assuredly there was joy and there was devotion; for the laden cart made the difference between plenty and starvation. Before that harvest-home came there had been many an aching heart in the village hovels, for there was no store to equalize prices, and no communication to make the abundance of one district—much less of one country—mitigate the scarcity of another. It was not a question of the rise or the fall of a penny or two in the price of a loaf of bread; it was a question of bread or no bread.

During those dark periods the crown carried on the war against capital with an industry that could not be exceeded by that of the nobles or the people. Before the great charter the Commons complained that King Henry seized upon whatever was suited to his royal pleasure—horses, implements, food, anything that presented itself in the shape of accumulated labour. In the reign of Henry III. a statute was passed to remedy excessive distresses; from which it appeared that it was no unfrequent practice for the king's officers to take the opportunity of seizing the farmer's oxen at the moment when they were employed in ploughing, or, as the statute says, "winning the earth,"—taking them off, and starving them to death, or only restoring them with new and enormous exactions for their keep. Previous to the Charter of the Forest no man could dig a marl-pit on his own ground, lest the king's horses should fall into it when he was hunting. As late as the time of James I. we find, from a speech of the great Lord Bacon, that it was a pretty constant practice of the king's purveyors to extort large sums of money by threatening to cut down favourite trees which grew near a mansion-house or in avenues. Despotism, in all ages, has depopulated the finest countries, by rendering capital insecure, and therefore unproductive; insomuch that Montesquieu lays it down as a maxim, that lands are not cultivated in proportion to their fertility, but in proportion to their freedom. In the fifteenth century, in England, we find sums of money voted for the restoration of decayed towns and villages. Just laws would have restored them much more quickly and effectually. The state of agriculture was so low that the most absurd enactments were made to compel farmers to till and sow their own lands, and calling upon every man to plant at least forty beans. All the laws for the regulation of labourers, at the same period, assumed that they should be compelled to work, and not wander about the country,—just in the same way that farmers should be compelled to sow and till. It is perfectly clear that the towns would not have been depopulated, and gone to decay, if the accumulation of capital had not been obstructed by insecurity and wasted by ignorance, and that the same insecurity and the same waste rendered it necessary to assume that the farmer would not till and sow, and the labourer would not labour, without compulsion. The natural stimulus to industry was wanting, and therefore there was no industry, or only unprofitable industry. The towns decayed, the country was uncultivated—production languished—the people were all poor and wretched; and the government dreamt that acts of parliament and royal ordinances could rebuild the houses and cultivate the land, when the means of building and cultivation, namely, the capital of the country, was exhausted by injustice producing insecurity.

But if the king, the nobles, and the people of the middle ages conspired together, or acted at least as if they conspired, to prevent the accumulation of capital, the few capitalists themselves, by their monstrous regulations, which still throw some dark shadows over our own days, prevented that freedom of industry without which capital could not accumulate. Undoubtedly the commercial privileges of corporations originally offered some barriers against the injustice of the crown and of the nobility; but the good was always accompanied with an evil, which rendered it to a certain extent valueless. Where these privileges gave security, they were a good; where they destroyed freedom, they were an injury. Instead of encouraging the intercourse between one trade and another, they encircled every trade with the most absurd monopolies and exclusive privileges. Instead of rendering commerce free between one district and another, they, even in the same country, encompassed commerce with the most harassing restrictions, which separated county from county, and town from town, as if seas ran between them. If a man of Coventry came to London with his wares, he was encountered at every step with the privileges of companies; if the man of London sought to trade at Coventry, he was obstructed by the same corporate rights, preventing either the Londoner or the Coventry man trading with advantage. The revenues of every city were derived from forfeitures upon trades, almost all established upon the principle that, if one trade became too industrious or too clever, it would be the ruin of another trade. Every trade was fenced round with secrets; and the commonest trade, as we know from the language of an apprentice's indenture, was called an "art and mystery." All these follies went upon the presumption that "one man's gain is another man's loss," instead of vanishing before the truth, that, in proportion as the industry of all men is free, so will it be productive; and that production on all sides ensures a state of things in which every exchanger is a gainer, and no one a loser.

It is not to be wondered at that, while such opinions existed, the union of capital and labour should have been very imperfect; and that, while the capitalists oppressed the labourers, in the same way that they oppressed each other, the labourers should have thought it not unreasonable to plunder the capitalists. It is stated by Harrison, an old writer of credit,[13] that during the single reign of Henry VIII. seventy-two thousand thieves were hanged in England. No fact can exhibit in a stronger light the universal misery that must have existed in those days. The whole kingdom did not contain half a million grown-up males, so that, considering that the reign of Henry VIII. extended over two generations, about one man in ten must have been, to use the words of the same historian, "devoured and eaten up by the gallows." In the same reign the first statute against Egyptians (gipsies) was passed. These people went from place to place in great companies—spoke a cant language, which Harrison calls Pedler's French—and were subdivided into fifty-two different classes of thieves. The same race of people prevailed throughout Europe. Cervantes, the author of 'Don Quixote,' says of the Egyptians or Bohemians, that they seem to have been born for no other purpose than that of pillaging. While this universal plunder went forward, it is evident that the insecurity of property must have been so great that there could have been little accumulation, and therefore little production. Capital was destroyed on every side; and because profitable labour had become so scarce by the destruction of capital, one-half of the community sought to possess themselves of the few goods of the other half, not as exchangers but as robbers. As the robbers diminished the capital, the diminution of capital increased the number of robbers; and if the unconquerable energy of human industry had not gone on producing, slowly and painfully indeed, but still producing, the country would have soon fallen back to the state in which it was a thousand years before, when wolves abounded more than men. One great cause of all this plunder and misery was the oppression of the labourers.

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