Book I.

“Each of those different branches of trade, however, is not only advantageous, but necessary and unavoidable, when the course of things, without any constraint or violence, naturally introduces it,” says he, after giving an exposition of the respective advantages of the various forms of economic activity. (Wealth of Nations, Book II, chap. 5; Cannan, vol. i, p. 352.)

Wealth of Nations, Book IV, chap. 2; Cannan, vol. i, p. 419.

Ibid., Book IV, chap. 1; vol. i, p. 422.

Ibid., Book IV, chap. 3, part ii; vol. i, pp. 457-458.

Principles of Political Economy, Book III, chap. 17.

Wealth of Nations, Book IV, chap. 8; Cannan, vol. ii, p. 159.

It is true that in Book IV, chap. 3, part 2, he declares: “In every country it always is and must be the interest of the great body of the people to buy whatever they want of those who sell it cheapest. The proposition is so very manifest, that it seems ridiculous to take any pains to prove it.” (Cannan, vol. i, p. 458.)

Speaking of duties on corn, he writes: “To prohibit by a perpetual law the importation of foreign corn and cattle, is in reality to enact, that the population and industry of the country shall at no time exceed what the true produce of its own soil can maintain.” (Ibid., Book IV, chap. 2; vol. i, p. 427.) He always views the question from the standpoint of increased population and labour, and not from that of the consumer.

Ibid., Book II, chap. 5. Cf. Book IV, chap. 1.

Wealth of Nations, Book IV, chap. 2, in fine; Cannan, vol. i, p. 435.

The “Navigation Laws” is a generic term for a number of laws, the most famous of them dating from the time of Cromwell. Their immediate object was the destruction of the Dutch fleet, and English commerce was organised with a view to securing this. There is no doubt but that they contributed very considerably to the development of English maritime power.

Ibid., Book IV, chap. 2; vol. i, p. 429.

But “when there is no probability that any such repeal can be procured it seems a bad method of compensating the injury done to certain classes of our people, to do another injury ourselves, not only to those classes, but to almost all the other classes of them.” (Ibid., Book IV, chap. 2; vol. i, p. 433.)

The discussion of these various cases is to be found towards the end of chap. 2 of Book IV.

This system is expounded in Book V, chap 2, part ii, art. 5.

In the preface to his translation, 1821 ed., p. lxix.

Rae, Life of Smith, p. 103. The author of this famous phrase is not known.

J. B. Say, Traité, 1st ed., p. 240.

Mantoux, La Révolution industrielle, p. 83. M. Halévy gives expression to a similar idea in his La Jeunesse de Bentham, p. 193 (Paris, 1901).

So called in honour of the leading English representative, Lord Eden.

In 1778, 1784, 1786, 1789.

1791, 1793, 1796.

Professor Kraus, writing in 1796, declared that no book published since the days of the New Testament would effect so many welcome changes when it became thoroughly known (J. Rae, p. 360). By the beginning of the nineteenth century its influence had become predominant. All the Prussian statesmen who aided Stein in the preparation and execution of those important reforms that gave birth to modern Prussia were thoroughly versed in Smith’s doctrines, and the Prussian tariff of 1821 is the first European tariff in which they are deliberately applied. (Cf. Roscher, Geschichte der Nationalökonomik in Deutschland.)

In his introduction to the Traité, 1st ed. (The phrase was deleted in the 6th ed.)

J. B. Say, Traité, 1st ed., introduction, p. xxxiii.

He was born at Lyons on January 5, 1767. After a visit to England he entered the employment of an assurance company, and took part as a volunteer in the campaign of 1792. From 1794 to 1800 he edited a review entitled Décade philosophique, littéraire et politique, par une Société de Républicains. He was nominated a member of the Tribunate in 1799. After the publication of his Traité, the First Consul, having failed to obtain a promise that the financial proposals outlined in the first edition would be eliminated in the second, dismissed him from the Tribunate, offering him the post of director of the Droits réunis as compensation. Say, who disapproved of the new régime, refused, and set up a cotton factory at Auchy-les-Hesdins in the Pas-de-Calais. He realised his capital in 1813, returned to Paris, and in 1814 published a second edition of his treatise. In 1816 he delivered a course of lectures on political economy at the Athénée, probably the first course given in France. These lectures were published in 1817 in his Catéchisme d’Économie politique. In 1819 the Restoration Government appointed him to give a course on “Industrial Economy” (the term “Political Economy” was too terrible). In 1831 he was made Professor of Political Economy in the Collège de France. He died in 1832. His Cours complet d’Économie politique was published, in six volumes, in 1828-29.

Cf. a letter to Louis Say in 1827 (Œuvres diverses, p. 545).

Garnier’s translation of Adam Smith, 1802, vol. v, p. 283.

Traité, 1803 ed., p. 39.

Ibid., p. 21. Later on he employs the more comprehensive term “natural agents.”

Traité, 1803 ed., Book I, chaps. 42 and 43. By “industry” Say understands every kind of labour. Cf. 6th ed., pp. 70 et seq.

Malthus still appeared hostile to the doctrine of immaterial products, but Lauderdale, Tooke, McCulloch, and Senior accepted it, and it seemed definitely fixed when Stuart Mill confined the word “product” to material products only. For Tooke’s view see his letter to J. B. Say in the Œuvres diverses of the latter.

Traité, Book I, chap. 2. Is it not strange that Say should have failed to apply this idea to commerce? He regards the latter as productive because it creates exchangeable values. Nevertheless he criticises Condillac for having said that mere exchange of goods increases wealth because it increases the utility of objects. This is because Say is perpetually mixing up utility and exchange value, a confusion that leads him into many serious mistakes.

Traité, 6th ed., p. 6. The word “laws” does not appear in the first edition. Say merely speaks of general principles. It is found for the first time in the edition of 1814: “General facts or, if one wishes to call principles by that name, general laws” (p. xxix).

Correspondence with Malthus, in Œuvres diverses, p. 466.

Traité, Introd., 1st ed., p. ix; 6th ed., p. 13.

Ibid., 1st ed., Book I, p. 404.

There is no need for exaggeration, however, and no need to regard Say as totally indifferent to suffering and misery. He declares, e.g., that “for many homes both in town and country life is one long privation,” and that thrift in general “implies, not the curtailment of useless commodities, such as expediency and humanity would welcome, but a diminution of the real needs of life, which is a standing condemnation of the economic system of many Governments.” (Traité, 1st ed., vol. i, pp. 97-98; 6th ed., p. 116.)

Traité, 6th ed., p. 403.

Ibid., 1st ed., vol. i, p. 48.

Ibid., 5th ed., vol. i, p. 67.

Critical examination of McCulloch’s treatise (1825), in Œuvres diverses, pp. 274-275.

Traité, 6th ed., p. 349.

“Rent,” he says, “doubtless is partly interest on capital buried in the soil, for there are few properties which do not owe something to improvements made in them. But their total value is seldom due to this alone. It might be if the land were fertile but lacked the necessary facilities for cultivation. But this is never the case in civilised countries.” (Critical examination of McCulloch’s treatise (1825), in Œuvres diverses, p. 277.)

Traité, 1st ed., p. 154.

“The theory of heat and of weight and the study of the inclined plane have placed the whole of nature at the disposal of mankind. In the same way the theory of exchange and of markets will change the whole policy of the world.” (Ibid., 6th ed., p. 51.)

Traité, 1st ed., vol. ii, p. 175.

Ibid., p. 179.

Ibid., p. 178.

“One kind of product would seldom be more plentiful than another and goods would seldom be too many if everyone were given complete freedom.” Too much stress has possibly been laid on the phrase “Certain products are superabundant just because others are wanting,” and it has been taken as implying that even partial over-production is an impossibility. A note inserted on the next page helps to clear up the matter and to prevent misunderstanding. “The argument of the chapter,” says he, “is not that partial over-production is impossible, but merely that the production of one thing creates the demand for another.” He certainly seems unfaithful to his own position in the letters he wrote to Malthus, in which he tries to defend his own point of view by saying that “production implies producing goods that are demanded,” and that consequently if there is any excessive production it is not the fault of production as such and cannot be regarded as over-production. In greater conformity with his own views and much nearer the truth is his reply to an article by Sismondi published in 1824 in the Revue encyclopédique under the title Sur la Balance des Consommations avec les Productions (Œuvres diverses, p. 250). His statements vary from one edition to another, and anything more unstable than Say’s views on this question would be difficult to imagine. The formula “Products exchange for products” is so general that it includes everything, but means nothing at all; for what is money, after all, if it is not a product?

Letters to Malthus (Œuvres diverses, p. 466).

Malthus, Principles of Political Economy, Book II, chap. 1, sect. 9.

Sur la Balance des Consommations avec les Productions, p. 252.

Ibid., p. 251.

Dühring, Kritische Geschichte der Nationalökonomie und des Sozialismus, 2nd ed., 1875, p. 165. For the other side of the question one may profitably peruse the interesting study of Say contributed by M. Allix to the Revue d’Économie politique, 1910 (pp. 303-341), and the Revue d’Histoire des Doctrines, 1911, p. 321.

Stanley Jevons (Theory of Political Economy, 3rd ed., 1888) has recognised in too absolute a fashion, perhaps, the superiority of the French economists over Ricardo. “The true doctrine may be more or less clearly traced through the writings of a succession of great French economists, from Condillac, Baudeau, and Le Trosne, through J. B. Say, Destutt de Tracy, Storch, and others, down to Bastiat and Courcelle-Seneuil. The conclusion to which I am ever more clearly coming is that the only hope of attaining a true system of economics is to fling aside, once and for ever, the mazy and preposterous assumptions of the Ricardian School.” (Preface, p. xlix.)

“The people must comprehend that they are themselves the cause of their own poverty.” (Malthus, p. 458.) Doubtless this is the reason why M. Halévy, among others, in his book Le Radicalisme philosophique, remarks that Ricardo, Malthus, and their disciples were regarded as the exponents of optimism and quietism. But in what sense were they optimists? Of course they believed that the existing economic order is the best possible, and that it would be impossible to change it for a better. That may be. But we prefer to think of them as “contented pessimists.”

“Every reader of candour must acknowledge that the practical design uppermost in the mind of the writer, with whatever want of judgment it may have been executed, is to improve the condition and increase the happiness of the lower classes of society.” It is with this declaration that Malthus brings his book on population to a close.

Miss Edgeworth, a contemporary of Ricardo, states in her letters that political economy was so much the fashion that distinguished ladies before engaging a governess for their children inquired about her competence to teach political economy.

Conversations on Political Economy, by Mrs. Marcet (1816). Illustrations of Political Economy, by Miss Martineau (9 vols., containing thirty stories, 1832-34).

Thomas Robert Malthus was born in 1766. His father, a country gentleman, was a man of learning and a friend of most of the philosophers of his time, especially Hume, and, it also seems, J. J. Rousseau. He was the youngest son of the family, and was intended for the Church and given an excellent education. After leaving Cambridge he took a living in the country, but in 1807 was appointed professor at a college founded by the East India Company at Haileybury, in Hertfordshire, where he remained until his death in 1834. He married when thirty-nine years of age, and had three sons and a daughter.

Malthus was a young unmarried clergyman living in a small country parish when, at the age of thirty-two, he in 1798 published anonymously his famous Essay on the Principle of Population as it affects the Future Improvement of Society. His critics were legion. In order to devote more study to the subject, he took a three years’ tour (1799-1802) on the Continent—avoiding France, because France at this period was anything but inviting to an Englishman. In 1803 he published—under his own name this time—a second edition, much modified and amplified, and with a slightly different title: An Essay on the Principle of Population, or a View of its Past and Present Effects on Human Happiness. Four other editions were published during his lifetime.

We must not forget his other works, although they were all eclipsed by his earliest effort. These were: The Principles of Political Economy considered with a View to their Practical Application (1820); A Series of Short Studies dealing with the Corn Laws (1814-15); On Rent (1815); The Poor Law (1817); and finally his Definitions in Political Economy (1827).

See Stangeland, Pre-Malthusian Doctrines (New York, 1904).

Godwin, Political Justice, Book VIII, chap. 7 (reprinted, London, 1890).

“Man doubtless will never become immortal, but it is possible that the span of human life may be indefinitely prolonged.”

Chap. 8 is entitled “The Error of Thinking that the Danger resulting from Population is Remote.” “There are few States in which there is not a constant effort in the population to increase beyond the means of subsistence. This constant effort as constantly tends to subject the lower classes of society to distress, and to prevent any great permanent amelioration of their condition.” (P. 10.)

If two children were the normal issue of every marriage, population would evidently diminish, for all the children will not reach the marriageable age. Of those that do all will not become parents. Experience seems to show that with a birth-rate of less than three per family population does not increase, or if it does grow at all it is almost imperceptibly. This is the case in France, where on an average there are 2·70 births to every marriage.

To justify multiplying by two, Malthus regards a family of six as being a normal one. Of the six, two will die before attaining marriageable age, or will remain celibates, so that we are left with four, who will in turn become parents, and so we have the series 2, 4, etc.

The statement that population doubles every twenty-five years might appear to be confirmed by the growth of population in the United States. It is curious to find that the population there during the nineteenth century conforms exactly to Malthus’s formula. In 1800 it was 5 millions. Doubling four times (4 periods of 25 years = 100) gives us a population of 80 millions, which is actually the figure for 1905, five years after the end of the century. But of course this is pure chance, the increase resulting from immigration rather than a rising birth-rate.

It was in this connection that Malthus penned those famous words which have been so frequently brought up against him, although they were omitted from a later edition. “A man who is born into a world already possessed, if he cannot get subsistence from his parents on whom he has a just demand, and if the society do not want his labour, has no claim of right to the smallest portion of food, and, in fact, has no business to be where he is. At Nature’s mighty feast there is no vacant cover for him. She tells him to be gone.…” On the other hand, let us remember his services in reorganising public assistance in England in 1832.

“The effect of anything like a promiscuous intercourse which prevents the birth of children is evidently to weaken the best affections of the heart and in a very marked manner to degrade the female character. And any other intercourse would, without improper arts, bring as many children into the society as marriage, with a much greater probability of their becoming a burden to it.” (P. 450.)

“These considerations show that the nature of chastity is not, as some have supposed, a forced produce of artificial society; but that it has the most real and solid foundation in nature and reason; being apparently the only virtuous means of avoiding the vice and misery which result so often from the principle of population.” (P. 450.)

He also notes that this virtue has usually been especially commended to women, but that “there is no reason for supposing that the violation of the laws of chastity are not equally dishonourable for both sexes.” Malthus evidently believed in one moral law for both sexes.

Consequently whenever the reverend gentleman is reproached with encouraging blasphemy, a point upon which he is particularly sensitive—for example, when it is pointed out that God’s injunction to man was to increase and multiply—he has no difficulty in showing that if procreation is the will of Providence, chastity is dictated by Christianity, and that the glorious work of chastity is to aid Providence in keeping even the balance of life.

“Of the other branch of the preventive check, which comes under the head of vice, though its effect appears to have been very considerable, yet upon the whole its operation seems to have been inferior to the positive checks.” (P. 140.)

“I have said what I conceive to be strictly true, that it is our duty to defer marriage till we can feed our children; and that it is also our duty not to indulge ourselves in vicious gratifications; but I have never said that I expected either, much less both, of these duties to be completely fulfilled. In this and a number of other cases, it may happen that the violation of one of two duties will enable a man to perform the other with greater facility.… The moralist is still bound to inculcate the practice of both duties, and each individual must be left to act as his conscience shall dictate.” (P. 560.)

“I should be extremely sorry to say anything which could either directly or remotely be construed unfavourably to the cause of virtue; but I certainly cannot think that the vices which relate to the sex are the only vices which are to be considered in a moral question.” (P. 462.) Malthus omits to mention the particular vice which he has in mind. “I have not the slightest hesitation in saying that the prudential check [note the word—no longer “moral restraint”] to marriage is better than premature mortality.” (P. 560.) We are far removed from the first edition, where there is no mention of a third alternative between chastity and vice.

“Abject poverty is a state the most unfavourable to chastity that can well be conceived.… There is a degree of squalid poverty in which if a girl was brought up I should say that her being really modest at twenty was an absolute miracle.” (P. 464.) And elsewhere he writes: “I maintain that the diminution of the vice which results from poverty would afford a sufficient compensation for any other evil that might follow.”

These figures only give the values expressed in money by capitalising them at the market rate of interest, which gives a rather fictitious result. It does not warrant the belief that an American citizen of to-day, however much his consumption may have increased, is any better off than his ancestors.

These differ, again, from the desire for marriage, which is influenced by other considerations. French people marry in order to have a home, but a desire for a home and a desire for love or for children are very different things.

“By a son a man obtains victory over all people; by a son’s son he enjoys immortality; and afterwards by the son of that grandson he reaches the solar abode.” “The son delivers his father from hell.” “A son of a Brahmin if he performs virtuous acts redeems from sin his ten ancestors.” (P. 105.)

This is Manu’s law, which Malthus quotes in support of his contention. But he failed to see that as soon as one begins to doubt Manu’s teaching the argument is the other way. One of the reasons why sterility was considered a dishonour by Jewish women was that each of them secretly hoped that she might become the mother of the promised Messiah. But when the Jews ceased to hope for the Deliverer that was to come, then the incentive to childbirth was gone.

Neo-Malthusianism dates from the publication of Dr. Drysdale’s book, Elements of Social Science, in 1854, but the Malthusian League came into existence only in 1877. During the last few years the movement seems to have taken hold everywhere, especially in France, where we would least have expected it.

He categorically declares that “we must suppose the general prevalence of such prudential habits among the poor as would prevent them from marrying when the actual price of labour joined to what they might have saved in their single state would not give them the prospect of being able to support a wife and five or six children without assistance.” (P. 536.) Marriage seems prohibited to every worker whose wages are not enough to keep eight persons, which practically would mean that no workman could marry.

“I have been accused of proposing a law to prohibit the poor from marrying. This is not true.… I am, indeed, most decidedly of opinion that any positive law to limit the age of marriage would be both unjust and immoral.” (P. 357.)

It is worth while recalling the passage to which we have already incidentally drawn attention: “The poor are themselves the cause of their own poverty.” (P. 458.)

His views concerning charity are exceedingly interesting, and are directly connected with his theory of population. This was the practical question about which he was most concerned, and his influence in this direction has been very considerable. He showed himself an uncompromising opponent of the English Poor Law as it then existed. Speaking of the famous 43rd of Elizabeth, he declares that one of its clauses is “as arrogant and as absurd as if it had enacted that two ears of wheat should in future grow where one only had grown before. Canute, when he commanded the waves not to wet his princely foot, did not in reality assume a greater power over the laws of nature.” Since public assistance cannot create wealth, it cannot either keep alive a single pauper. “It may at first appear strange, but I believe it is true, that I cannot by means of money raise the condition of a poor man … without proportionally depressing others in the same class.” But it may be pointed out that although charity cannot beget wealth it does transfer a certain portion of wealth from the pockets of the rich to fill the mouths of the hungry poor. The consumption of the one is increased just as much as the other’s is decreased.

Not only does he condemn charity in the way of almsgiving, but also the practice of giving work for charity’s sake. He admits an exception in the case of education, of which everybody can partake without making anyone else the poorer. Such arguments would seem to imply the prohibition of all charity, whether public or private, and as a matter of fact he demands the gradual abolition of the Poor Laws and of every kind of systematic assistance which offers to the poor any kind of help upon which they can always reckon. But he recognises the “good results of private charity, discriminately and occasionally exercised.” Though he failed to remove the Poor Laws, the effect of his teaching is clearly seen in the Poor Law Amendment Act of 1834.

Malthus’s doctrine is just the reverse of the social teaching on the question in France at the present time. There you have an attempt to substitute solidarity for Christian charity. That means that the poor should be able to demand assistance, not as a gift, but as a right, and that the place of individual or private charity should be taken by a public institution with a view to giving effect to this. His teaching concerning the preventive obstacle has been so thoroughly taken to heart that there is not much fear of legal assistance resulting in a growth of population.

It is not proved, however, that such were Malthus’s views. Private property, at least peasant proprietorship, acts as a stimulus to population. And it is very curious to think that he should have taken his illustration from France, where the multiplication of small farms is considered one of the causes of the falling birth-rate. “At all times the number of small farmers and proprietors in France was great, and though such a state of things is by no means favourable to the clear surplus produce or disposable wealth of a nation, yet sometimes it is not unfavourable to the absolute produce, and it has always a strong tendency to encourage population.” And again: “Even in France, with all her advantages of situation and climate, the tendency of population is so great and the want of foresight among the lower classes so remarkable.…” Godwin and Young express similar opinions. The latter is quoted by Malthus: “The predominant evil of the kingdom is the having so great a population that she can neither employ nor feed it.” (P. 509.)

Marriage, Malthus thought, had a restraining influence upon population. He admits that the simplest and most natural obstacle is to oblige every father to rear his own children. He also admits that the shame which the mother of a bastard and her child have to endure is a matter of social necessity. He does not approve of forcing the man who has betrayed a woman to marry, but he declares that seduction ought to be seriously punished. This is the view commonly adopted to-day, but it was very novel then.

There are some sociologists who, like Malthus, would seek an explanation both of depopulation and of over-population in biological causes. Fourier and Doubleday, for example, are among the number. Doubleday, who wrote forty years before Malthus, believed that fecundity varied inversely with subsistence, and that this acted as a kind of natural check upon the growth of population. There are others, again, who think that reproductive capacity varies inversely with intellectual activity. Both explanations seem to suggest a kind of opposition between the development of the individual and the progress of the race which is very suggestive. But their views have not gained many adherents. If they are ever proved, which is not very likely, the prospect is not an attractive one. It would mean that those nations and classes who have risen to a position of ease through their superior culture would disappear, while the poorer, uncultured masses would continue to increase.

David Ricardo was descended from a Jewish family originally domiciled in Holland. He was born in 1772 in London, where his father had settled as a stockbroker. He entered business at an early age, and soon became thoroughly conversant with the intricacies of banking and exchange. On the occasion of his marriage he changed his religion, and thus incurred the displeasure of his family. Setting up as a broker on his own account, he was not long in amassing a huge fortune, estimated at about £2,000,000—an enormous sum for those days.

Naturally enough, his earliest interest in economics centred round banking questions. The French wars had caused a depreciation in the value of the bank-note, and this aroused the interest not only of the specialists, but also of the public. His first essay, published in 1810, when he was thirty-eight years of age, was entitled The High Price of Bullion a Proof of the Depreciation of Bank-notes. It was soon followed by other studies dealing with banks and with the credit system. But these short polemical efforts gave scarcely any indication of the great attention which he was bestowing upon the principles of the science. His interest was primarily personal, for it appears that he had no intention of publishing anything on the subject. In 1817, however, the results were seen in a volume entitled The Principles of Political Economy. Ricardo the business man could hardly have guessed that it would shake the capitalistic edifice to its very foundations.

In 1819 he was elected a member of the House of Commons, but he was as indifferent a speaker as he was a writer. He was always listened to, however, with the greatest respect. “I have twice attempted to speak,” he writes, “but I proceeded in the most embarrassed manner: and I have no hope of conquering the alarm with which I am assailed the moment I hear the sound of my own voice.” In 1821 he founded the Political Economy Club, the earliest of those numerous societies for the study of economic subjects which have since been established in every country. In 1822 he published a work on Protection to Agriculture. The following year he died, at the comparatively early age of fifty-one.

Since his death all his writings have been carefully collected, and his correspondence with the chief economists of his day, with Malthus, McCulloch, and Say, published. The correspondence is extremely important for an understanding of his doctrines.

Letter to McCulloch, July 13, 1820, quoted by H. Denis, vol. ii, p. 171.

In his correspondence with McCulloch, under date December 18, 1819, he writes: “I am not satisfied with the explanation which I have given of the principles which regulate value. I wish a more able pen would undertake it.”

In a letter to Malthus written on August 15, 1820, speaking of his own theory of value and of McCulloch’s, he despairingly adds: “Both of us have failed.” See Halévy, Le Radicalisme philosophique, and Hector Denis, op. cit.

Smith had likened industry to a household with two children—wages and profits; agriculture to a household with three—wages, profits, and rent.

An Inquiry into the Nature and Progress of Rent (1815).

It is necessary to remember, however, that the old theory survived and appears here under the very name of Ricardo, for he was unsuccessful in freeing himself altogether from its influence. He defines rent as “that portion of the produce of the earth which is paid to the landlord for the use of the original and indestructible powers of the soil.” He continually refers to these powers of the soil, which are described as “natural,” “primitive,” “indestructible,” i.e. as independent of all labour.

“Nothing is more common than to hear of the advantages which the land possesses over every other source of useful produce on account of the surplus which it yields in the form of rent. Yet when land is most abundant, when most productive and most fertile, it yields no rent, and it is only when its powers decay … that rent appears.” (Principles, ed. Gonner, p. 52.)

“The labour of Nature is paid, not because she does much, but because she does little. In proportion as she becomes niggardly in her gifts she exacts a greater price for her work.” (Ibid., p. 53, note.)

“The comparative scarcity of the most fertile lands is the cause of rent.” (Ibid., p. 395.)

Adam Smith had already offered this as an explanation in the case of the products of the mine, but he failed to see that arable land is really nothing but a sort of mine.

To-day we simply say that it is determined by increased demand. But this is quite contrary to Ricardo’s views, for in his opinion it is labour and not demand that creates value.

“The value of corn is regulated by the quantity of labour bestowed on its production on that quality of land [or with that portion of capital] which pays no rent.” (Principles, ed. Gonner, p. 51.)

The illustration as given by Ricardo is somewhat more complicated.

“When land of an inferior quality is taken into cultivation the exchangeable value of raw produce will rise because more labour is required to produce it.” (Ibid., p. 49.)

See Cannan’s delightful volume The Theories of Production and Distribution, p. 150, where the average decennial price works out as follows:

s. d.

1770-1779 45 0 1780-1789 45 9 1790-1799 55 11 1800-1809 82 2 1810-1813 106 2

The number of Enclosure Acts which Parliament, acting with the sanction of public opinion, passed during the latter part of the eighteenth and the beginning of the nineteenth centuries increased very rapidly. Between 1700 and 1845 no fewer than 3835 such Acts were passed, involving the enclosure of 7,622,664 acres, most of it common land. Not until 1845 do we find a change either in the attitude of public opinion or in the action of Parliament.

It is not quite clear whether the high price of corn is due to the cultivation of new lands or whether this high price is the cause of the cultivation of new lands. The second interpretation appears to us to be the most natural, but it involves the abandonment of the Ricardian theory.

Some critics, e.g. Fontenay, Bastiat’s disciple, suggested that land No. 4 might very well become No. 1, if, instead of being employed in the cultivation of corn, an intelligent husbandman were to put it to viticulture or rose-growing. But this is to beg the question. The law of rent implies products of the same kind, for it is this identity of quality that enables them to be sold at the same price. If bad corn-land could become good rose-growing ground, then of course it would take its place among rose-growing areas, yielding rent as soon as less fertile lands were employed for the same purpose.

Turgot, Observations sur un Mémoire de M. de Saint-Péravy (Œuvres, vol. i, p. 420). “It can never be imagined that a doubling of expenditure would result in doubling the product.… It is more than probable that by gradually increasing the expenditure up to the point where nothing would be gained on the return, such items would successively become less fruitful. The earth’s fertility resembles a spring that is being pressed downwards by the addition of successive weights. If the weight is small and the spring not very flexible, the first attempts will leave no results. But when the weight is enough to overcome the first resistance then it will give to the pressure. After yielding a certain amount it will again begin to resist the extra force put upon it, and weights that formerly would have caused a depression of an inch or more will now scarcely move it by a hair’s breadth. And so the effect of additional weights will gradually diminish.

“The comparison is not very exact, but it is near enough to enable us to understand that when the earth is producing nearly all it can, a great deal of expense is necessary to obtain very little more produce.”

Turgot, with his usual perspicacity, has noted a fact which the Classical writers generally failed to perceive, namely, that at the beginning of the process of cultivation there may be a period when the return shows no signs of diminishing.

We must note the fact that the law of diminishing returns was already implied in the second of the famous progressions given by Malthus, for an arithmetical progression that shows an increase of one every twenty-five years implies an addition slower than the growth of the series itself, i.e. slower than the movement of time. Let us take land that yields one; in twenty-five years it will yield two, an increase of 100 per cent. But this is only the first step. At the end of another twenty-five years it will yield three, the increase being always one. But the increase from two to three means an increase of only 50 per cent., from three to four of only 33 per cent., and so on to 25 per cent. and 20 per cent. When the hundredth place has been reached, the increase will only be 1 per cent., and it will continue to fall farther, only more slowly.

Ricardo gives a slightly different explanation. “If with a capital of £1000 a tenant obtains 100 quarters of wheat from his land, and by the employment of a second capital of £1000 he obtains a further return of eighty-five, his landlord would have the power at the expiration of his lease of obliging him to pay fifteen quarters, or an equivalent value for additional rent, for there cannot be two rates of profit.” (Principles, ed. Gonner, p. 48.) He means to say that if profits fall because new capital is less productive than old, rent must necessarily appear, because by definition rent is what remains of the produce after deducting profits and wages. This explanation closely resembles that one given by West in his Application of Capital to Land, published in 1815, and Ricardo was not above acknowledging his indebtedness to West.

Shortly afterwards a German landowner published a book dealing with just that side of the problem of rent which had been neglected by Ricardo, namely, the influence of distance from a market upon cultivation and the price of products. We are referring to Thünen, who in his book Der Isolerte Staat (vol. i, 1826) draws a picture of a town surrounded by a belt of land, and shows how cultivation will be distributed in concentric zones around that centre, and how the kind of cultivation adopted will be a function of the distance.

But the honour of discovering this law, which is so important for an understanding of exchange value, does not belong entirely to Ricardo. Forty years before a humble Scotch farmer named Anderson had observed the phenomenon and given a very satisfactory analysis of it in his book Observations on the Means of Exciting a Spirit of National Industry (1777). “Now as the expense of cultivating the least fertile soil is as great or greater than that of the most fertile field, it necessarily follows that if an equal quantity of corn, the produce of each field, can be sold at the same price, the profit on cultivating the most fertile soil must be much greater than that of cultivating the other, and as this continues to decrease as the sterility increases, it must at length happen that the expense of cultivating some of the inferior soils will equal the values of the whole produce.” (Quoted by Jevons, Theory of Political Economy, p. 229.) Anderson’s name was forgotten until quite recently, when it attracted a certain amount of attention among the pioneers of Ricardo. Ricardo himself does not seem to be aware of his existence; at least he never quotes him. The only two writers mentioned by Ricardo are Malthus and West.

“In speaking, however, of labour as being the foundation of all value, and the relative quantity of labour as almost exclusively determining the relative value of commodities, I must not be supposed to be inattentive to the different qualities of labour.” (Principles, ed. Gonner, p. 15.)

Hume had already pointed out the objection to this view. Cf. p. 64, footnote.

“If fixed capital be not of a durable nature it will require a great quantity of labour annually to keep it in its original state of efficiency, but the labour so bestowed may be considered as really expended on the commodity manufactured, which must bear a value in proportion to such labour.” (Principles, ed. Gonner, p. 32.)

In a note on Section VI, chap. 1, he adds: “Malthus appears to think that it is a part of my doctrine that the cost and value of a thing should be the same—it is, if he means by cost, cost of production including profits.” (Ibid., p. 39.)

Still we must note that Ricardo and Karl Marx, like everyone who has tried to base a theory of value upon labour, tacitly assume the operation of the law of demand and supply in order that their theories may fit in with the facts.

But how was it that he never realised that land at least in any given country, and indeed for that matter over the whole world, is simply a kind of wealth “of which no labour could increase the quantity”?

“The dealings between the landlord and the public are not like dealings in trade, whereby both the seller and the buyer may equally be said to gain, but the loss is wholly on one side and the gain wholly on the other.” (Principles, ed. Gonner, p. 322.) And so when a proprietor sells corn to a consumer it is not of the nature of an ordinary bargain where both parties gain something. The consumer gets nothing in return for what he gives, i.e. for what he gives over and above what it has cost to produce the corn. To get nothing in return for something given is the kind of transaction that generally goes by the name of theft.

Ricardo soon finds a reply to the comfortable doctrine of Smith, that the interests of the landlords are nowhere opposed to those of the rest of the community. “The interest of the landlord is always opposed to that of the consumer and manufacturer. Corn can be permanently at an advanced price only because additional labour is necessary to produce it, because its cost of production is increased. It is therefore for the interest of the landlord that the cost attending the production of corn should be increased. This, however, is not the interest of the consumer.… Neither is it the interest of the manufacturer that corn should be at a high price, for the high price of corn will occasion high wages, but will not raise the price of his commodity.” (Ibid., p. 322.)

“Wealth increases most rapidly in those countries where the disposable land is most fertile, where importation is least restricted, and where, through agricultural improvements, productions can be multiplied without any increase in the proportional quantity of labour, and where consequently the progress of rent is slow.” (Principles, ed. Gonner, p. 54.) The contrast between fertile lands, free exchange, and the development of agricultural science on the one hand, and the growth of rent on the other, is very strikingly brought out in this paragraph.

“Rent does not and cannot enter in the least degree as a component part of its price.” (Ibid., p. 55.) And he adds: “The clearly understanding of this principle is, I am persuaded, of the utmost importance to the science of political economy.” It is true that Smith, writing long before this time, had declared that the “high rate of rent is the effect of price,” but he does not seem to have attached any great importance to the remark.

Ricardo wisely admits the possibility of confiscating this rent by means of taxation, the reason for this being that “a tax on rent would affect rent only, it would fall wholly on landlords and could not be shifted to any class of consumers.” (Principles, ed. Gonner, p. 154.) And the argument which he advances in proof of this, namely, that the tax could not be shifted, seems to indicate that this particular kind of revenue is not quite as intangible as that of some other classes in society. But his advocacy is somewhat restrained, for, as he points out, it would be unjust to put all the burden of taxation upon the shoulders of one class of the community. Rent is often the property of people who, after years of toil, have invested their earnings in land. The original injustice, if any, would thus be got rid of in the process of selling the land. This might be a sufficient reason for indemnifying the expropriated, but it is not enough to condemn expropriation altogether.

“Malthus and Ricardo have both proved false prophets and mistaken apostles. The much-vaunted Ricardian law is a pure myth.” (Article by M. de Foville on Les Variations de la Valeur du Sol en Angleterre au XIXe Siècle, in L’Économiste français, March 21, 1908.)

Mr. Robert Thompson, in a paper read before the Royal Statistical Society on December 17, 1907, has shown how the average rent per acre, valued at 11s. 2d. in 1801-5, reached the figure of 20s. in 1841-45, and despite the abolition of protection continued to rise up to 1872-77, when it reached a maximum of 29s. 4d. It then continued to fall until it reached the present amount of 20s. The present figure is double what it was in Ricardo’s time, but considerable deductions are necessary in view of the improvements made in the character of the soil. Thompson, after making these deductions, puts the amount at 15s. 5d., leaving just 4s. 7d. for rent pure and simple. The 11s. for rent at the beginning of the century covered something besides economic rent. Considerable deductions are again necessary, but the amount of capital employed in agriculture was much less then.

One seems justified in saying that in England and even in France and other Protective countries the land has lost both in revenue and value during the last quarter of the nineteenth century almost all that it had gained from the time of Ricardo up till then. But is the recoil sufficient to justify Foville’s description of Ricardo’s vaunted law as a pure myth? We think not. It has the experience of seventy-five years behind it and of twenty-five years against it, that is all. Anyone who would predict a further fall in rent would certainly be running the risk of becoming a false prophet.

“The condition of the labourer will generally decline, and that of the landlord will always be improved.” (Principles, ed. Gonner, p. 79.)

“It generally happens, indeed, that when a stimulus has been given to population an effect is produced beyond what the case requires.… The increased wages are not always immediately expended on food, but are first made to contribute to the other enjoyments of the labourer. His improved condition, however, induces and enables him to marry.” (Principles, ed. Gonner, p. 95.)

“Every suggestion which does not tend to the reduction in number of the working people is useless, to say the least of it. All legislative interference must be pernicious.” (Quoted by Graham Wallas, Life of Francis Place. Place was the author of a book on population which appeared in 1822.)

This is a fundamental distinction upon which Ricardo is always insisting. The greater or smaller quantity of labour employed in the production of corn bears no necessary relation to the worker’s wages. The one is merely a question of production, the other of distribution. The one is the task, the other the reward. But some might ask if the Ricardian theory of value does not state that the value of the product is determined by the quantity of labour necessary for its production, that this value will be subsequently divided between capitalist and worker, and that the greater this quantity the greater will be the share of each. Labour’s share may increase, but not the labourer’s, for we must not forget that when the price of corn goes up from 10s. to 20s. it is because the cultivation of poorer lands requires twice the number of labourers demanded by the better kind of land. Besides, it would be a strange thing to pay a man more as the work becomes less remunerative. All that one could hope for would be that the workers under the new conditions might be able to retain their old standard of life—that is, might be able to purchase the same quantity of bread despite the rise in price.

“Thus, then, I have endeavoured to show that a rise of wages would invariably lower profits.”

“Thus in every case … profits are lowered … by a rise of wages.”

On the inexactness of the term “high rate of profits” as a synonym for a proportionally larger share of the produce see note, p. 162.

Ricardo does not deny this. Indeed, he lays stress upon the fact that he is arguing on the assumption that the value produced remains the same. “I have therefore made no allowance for the increasing price of the other necessaries, besides food of the labourer; an increase which would be the consequence of the increased value of the raw materials from which they are made, and which would of course further increase wages and lower profits.”

But this only means a rise in the nominal or money wage. It does not mean that the worker gets more corn; he only gets the same amount as before, because the price of corn has gone up and it makes no difference whether the man is paid in money or in kind.

“For as soon as wages should be equal to the whole receipts of the farmer, there must be an end of accumulation: for no capital can then yield any profit whatever, and no additional labour can be demanded, and consequently population will have reached its highest point.” (Principles, ed. Gonner, p. 67.)

When speaking of a reduction of capital’s share Ricardo frequently employs the phrase “a lowering of the rate of profits,” or “a fall in the rate of profits.” A fall in the rate is not necessarily synonymous with a reduction of capital’s share, however. The rate of profit simply implies a certain proportion between revenue and capital—5 per cent., for example; there is no suggestion of comparison between the quantities drawn by capitalist and workers respectively. Doubtless we must admit that when the rate of profit is diminished, ceteris paribus, the part drawn by capital relatively to labour’s share also diminishes, but it is clear that if the quantity of capital employed in any industry were to be doubled, or the product halved, capital, even at the rate of 3 instead of 5 per cent., would be drawing a more considerable share and leaving labour with less. Bastiat, as we shall have to note, made the same mistake.

In a letter to Malthus, December 18, 1814, he admits with a sigh of regret that even if a belt of fertile land were added to this island of ours profits would still keep up. Free Trade has added the illimitable zone of fertile land which Ricardo dreamed of, with the result that both profits and rents have fallen.

In his essay On Protection to Agriculture (1822) he shows how Protection, by forcing the cultivation of less fertile lands at home, raises the price of corn and increases rents; and his demand was not for free importation, but for a reduction of the duty to 10s. a quarter.

See An Inquiry into the Nature and Progress of Rent.

Cf. this unexpected remark to which H. Denis has recently drawn attention: “It is evidently impossible for any Government to let things just take their natural course.” (Malthus, introduction to the Principles.)

“Gold and silver having been chosen for the general medium of circulation, they are by the competition of commerce distributed in such proportions among the different countries of the world as to accommodate themselves to the natural traffic which would take place if no such metals existed and the trade between countries were purely a trade of barter.”

Ricardo also points out that “if, which is a much stronger case, we agreed to pay a subsidy to a foreign Power, money would not be exported whilst there were any goods which could more cheaply discharge the payment.” (McCulloch’s edition, p. 269.) As a matter of fact, the European Powers who were leagued against Napoleon were subsidised in this fashion, the exports exceeding the imports by many millions. The indemnity of 5 milliards of francs paid by France to Germany affords another illustration of the same truth.

Ricardo’s works, McCulloch’s edition, p. 287.

Ricardo’s works, McCulloch’s edition, p. 404.

Ibid., p. 349.

S. and B. Webb, History of Trade Unionism, p. 54.

In 1835 Andrew Ure (Philosophy of Manufactures, p. 481) reckoned that in the manufacture of cotton, wool, linen, and silk in England there were employed 4800 boys and 5308 girls below 11 years of age, 67,000 boys and 89,000 girls between 11 and 18 years of age, and 88,000 men and 102,000 women above 18 years; a total of 159,000 boys and men against 196,000 girls and women.

J. B. Say, De l’Angleterre et des Anglais, in Œuvres, vol. iv, p. 213.

Villermé’s report in Mémoires de l’Académie des Sciences morales, vol. ii, p. 414, note. Villermé’s observations were made in 1835 and 1836, although his celebrated work, Tableau de l’État physique et moral des Ouvriers, was not published till 1840. This book is a reproduction of his report to the Academy.

Enquête sur l’Industrie du Coton, 1829, p. 87. Evidence of Messrs. Witz and Son, manufacturers.

Vide Bulletin de la Société, etc., 1828, p. 326-329.

Cf. Rist, Durée du Travail dans l’Industrie française de 1820 à 1870, in the Revue d’Économie politique, 1897, pp. 371 et seq.

Sismondi was a native of Geneva. His family was originally Italian, but took refuge in France in the sixteenth century, and migrated to Geneva after the Revocation of the Edict of Nantes. Here Sismondi was born in 1773. He is even better known for his two great works L’Histoire des Républiques italiennes and L’Histoire des Français than for his economic studies. He was a frequent guest of Mme. de Staël at the Château Coppet, and among the other visitors whom he met there was Robert Owen. He died in 1842.

Nouveaux Principes, vol. ii, p. xxii. Our quotations are taken from the second edition, published in 1827.

Ibid., p. iv.

Two volumes, Paris, 1837 and 1838.

Nouveaux Principes, vol. ii, pp. 50-51. “Adam Smith’s doctrine is also ours, but the practical conclusion which we draw from the doctrine borrowed from him frequently appears to us to be diametrically opposed to his.”

Ibid., p. 56. “Adam Smith recognised the fact that the science of government was largely experimental, that its real foundation lay in the history of various peoples, and that it is only by a judicious observation of facts that we can deduce the general principles. His immortal work is, indeed, the outcome of a philosophic study of the history of mankind.” Cf. also vol. i, pp. 47, 389.

Nouveaux Principes, vol. ii, p. 268. Cf. also pp. 388, 389.

Ibid., p. 56. In several other passages he takes Ricardo to task (vol. i, pp. 257, 300, 336, 366, 423; vol. ii, pp. 184, 190, 218, 329).

Ibid., p. 86.

Études sur Économie politique, preface, p. v. Already in his first work, La Richesse commerciale, he had declared: “Political economy is based upon the study of man or of men. We must know human nature, the character and destiny of nations in different places and at different times. We must consult historians, question travellers, etc.… The philosophy of history … the study of travels, etc., are parallel studies.”

Nouveaux Principes, vol. i, p. 257.

Sismondi’s awkwardness in the manipulation of abstract reasoning is clearly visible in a host of other passages, especially in the vagueness of his definitions. Labour in one place is defined as the source of all revenues (ibid., vol. i, p. 85); elsewhere, as the workers’ revenue as contrasted with interest and rent (vol. i, pp. 96, 101, 110, 113, 114; vol. ii, p. 257, etc.). He never distinguishes between national and private capital, and wages are sometimes treated as capital, sometimes as revenue (p. 379). He constantly uses such vague terms as “rich” and “poor” to designate capitalist and worker (vol. ii, chap. 5). In his explanation of how the rate of interest is fixed he says that the strength of the lenders of capital just balances the strength of the borrowers, and, as in all other markets, they hit upon a proportional mean (vol. ii, p. 36). In a similar fashion he is constantly confusing revenue in kind with money revenue.

“Last year’s revenue pays for the production of this.” (Ibid., vol. i, p. 120.) Farther on he adds: “After all, what we do is to exchange the total product of this year against the total product of the preceding one” (p. 121). Sismondi attached great importance to the distinction between the national revenue and the annual product. “The confusion of the annual revenue with the annual product casts a thick veil over the whole science. On the other hand, all becomes clear and facts fall in with the theory as soon as one is separated from the other.” (Ibid., pp. 366-367.) It is he himself, on the contrary, who creates the confusion.

McCulloch criticised Sismondi in an article in the Edinburgh Review of October 1819. For J. B. Say see pp. 115-117.

With regard to Ricardo, Sismondi relates that in the very year of his death he had two or three conversations with him on this subject at Geneva. In the end he seems to have accepted Ricardo’s point of view, but not without several reservations. “We arrive then at Ricardo’s conclusion and find that when circulation is complete (and having nowhere been arrested) production does give rise to consumption”; but he adds: “This involves making an abstraction of time and place, and of all those obstacles which might arrest this circulation.”

Sismondi defended his point of view against his three critics in two articles reprinted at the end of the second edition of the Nouveaux Principes.

“The accumulation of wealth in abstracto is not the aim of government, but the participation by all its citizens in the pleasures of life which the wealth represents. Wealth and population in the abstract are no indication of a country’s prosperity: they must in some way be related to one another before being employed as the basis of comparison.” (Nouveaux Principes, vol i, p. 9.)

Nouveaux Principes, vol. ii, p. 250. Elsewhere he adds: “Should the Government ever propose to further the interests of one class at the expense of another that class should certainly be the workers.” (Ibid., vol. i, p. 372.)

Cours complet, vol. ii, p. 551.

Nouveaux Principes, vol. i, p. 333.

Ibid., p. 336.

Nouveaux Principes, vol. i, pp. 220-221.

The unanimity is not quite absolute, however. Ricardo in the third edition of his Principles added a chapter on machinery in which he admitted that he was mistaken in the belief that machines after a short period always proved favourable to the interests of the workers. He recognised that the worker might suffer, for though the machine increases the net product of industry it frequently diminishes the total product. He seemed to think that this might happen frequently, but in reality it is quite exceptional.

We may here recall the celebrated winch argument. Suppose, says Sismondi, that England succeeded in tilling her fields and doing all the work of her towns by means of steam power, so that her total products and revenue remain the same as they are to-day, though her population is only equal to that of the republic of Geneva. Is she to be regarded as being richer and more prosperous? Ricardo would reply in the affirmative. Wealth is everything, men nothing. Really, then, a single king, dwelling alone on the island, by merely turning a winch might conceivably automatically perform all the work done in England to-day. One can only reply to this argument by saying that long before arriving at this state the community itself would have devised some machinery for distributing the product between all its members. To suppose that a portion of the population dies of hunger through want of employment while the other part continues to manufacture the same quantity of goods as before is sufficiently contradictory. But at bottom, disregarding the paradoxical form given it by Sismondi, the question set by him is insoluble. What is the best equilibrium between production and population? Are we to prefer a population rapidly increasing in numbers, but making no advance in wealth, to a population which is stationary or even decreasing, but rapidly advancing in wealth? Everyone is free to choose for himself. Science gives us no criterion.

“We have said elsewhere, but think it essential to repeat it, that it is not the perfection of machinery that is the real calamity, but the unjust distribution of the goods produced. The more we are able to increase the quantity of goods produced with a given quantity of labour, the more ought we to increase our comforts or our leisure. Were the worker his own master, after accomplishing in two hours with a machine a task which formerly took him twelve he would then desist from toil, unless he had some new need or were able to make use of a larger amount of products. It is our present organisation and the workman’s servitude that has forced him to work not less but more hours, at the same wage, and this despite the fact that machinery has increased his productive powers.” (Nouveaux Principes, vol. ii, p. 318.) In this passage we have Sismondi’s real opinion on the subject of machinery most clearly expressed.

Wealth of Nations, Book II, chap. 2, in fine.

Nouveaux Principes, vol. i, p. 92.

Études sur l’Économie politique, vol. i, p. 35.

Ibid., pp. 274-275.

Nouveaux Principes, vol. i, p. 103.

On this point we must dissociate ourselves from the interpretation placed upon the passage by M. Aftalion in his otherwise excellent monograph, L’Œuvre économique de Simonde de Sismondi (Paris, 1899), as well as from the view expressed by M. Denis (Histoire des Systèmes économiques, vol. ii, p. 306). But Sismondi’s text appears to us to leave no room for doubt. “As against land we might combine the other two sources of wealth, life which enables a man to work and capital which employs him. These two powers when united possess an expansive characteristic, so that the labour which a worker puts in his work one year will be greater than that put in the preceding year—upon the product of which the worker will have supported himself. It is because of this surplus value [mieux value], which increases as the arts and sciences are progressively applied to industry, that society obtains a constant increment of wealth.” (Nouveaux Principes, vol. i, p. 103.)

Nouveaux Principes, vol. i, pp. 111-112. Cf. also p. 87: “Wealth, however, co-operates with labour. And its possessor withholds from the worker the part which the worker has produced beyond his cost of maintenance—as compensation for the help which he has given him.” It is true that this proportion is a considerable one. “The entrepreneur is bound to leave to the worker just enough to keep him alive, reserving for himself all that the worker has produced over and above this.” (P. 103.) But this is not a matter of necessity—a deduction from the laws of value, as it is with Marx.

“The poor man, by his labour and his respect for the property of others, acquires a right to his home, to warm, proper clothing, to ample nourishment sufficiently varied to maintain health and strength.… Only when all these things have been secured to the poor as the fruit of their labour does the claim of the rich come in. What is superfluous, after supplying the needs of everyone, that should constitute the revenue of opulence.” (Études sur l’Économie politique, vol. i, p. 273.) Here we see quite clearly the sense in which Sismondi uses the term “spoliation.”

Nouveaux Principes, vol. i, p. 407. Cf. also pp. 200, 201.

“Everyone’s interest if checked by everybody else’s would in reality represent the common interest. But when everyone is seeking his own interest at the expense of others as well as developing his own means, it does not always happen that he is opposed by equally powerful forces. The strong thus find it their interest to seize and the weak to acquiesce, for the least evil as well as the greatest good is a part of the aim of human policy.” (Ibid., p. 407.) Cf. also infra, p. 188, note 1.

“There is one fundamental change which is still possible in society, amid this universal struggle created by competition, and that is the introduction of the proletariat into the ranks of human beings—the proletariat, whose name, borrowed from the Romans, is so old, but who is himself so new.” (Études sur l’Économie politique, vol. i, p. 34.)

Revue mensuelle d’Économie politique, 1834, vol. ii, p. 124.

Nouveaux Principes, vol. ii, p. 434.

Études sur l’Économic politique, introd., pp. 39 et seq.

“That everyone understands his own interest better than any Government ever can is a maxim that has been considerably emphasised by economists. But they have too lightly affirmed that the interest of each to avoid the greatest evil coincides with the general interest. It is to the interest of the man who wishes to impoverish his neighbour to rob him, and it may be the latter’s interest to let him do it provided he can escape with his life.

“But it is not in the interest of society that the one should exercise the force and that the other should yield. The interest of the day labourer undoubtedly is that the wages for a day of ten hours should be sufficient for his upkeep and the upbringing of his children. It is also the interest of society. But the interest of the unemployed is to find bread at any price. He will work fourteen hours a day, will send his children to work in a factory at ten years of age, will jeopardise his own health and life and the very existence of his own class in order to escape the pressure of present need.” (Nouveaux Principes, vol. i, pp. 200-201.)

Ibid., p. 201.

“Population will then regulate itself simply in accordance with the revenue. Where it exceeds this proportion it is always just because the fathers are deceived as to what they believe to be their revenue, or rather because they are deceived by society.” (Ibid., p. 254.) “The more the poor is deprived of all right of property the greater is the danger of its mistaking its revenue and contributing to the growth of a population which, because it does not correspond to the demand for labour, will never find sufficient means of subsistence.” (Ibid., p. 264.)

Ibid., p. 286.

We note that Sismondi does not accept Malthus’s theory of population. He never admits that population depends upon the means of subsistence; he holds that it varies according to the will of the proprietor, who stimulates or retards it according to his demand, but who is interested in its limitation in order to secure for himself the maximum net product. “Population has never reached the limits of possible subsistence, and probably it never will. But all those who desire the subsistence have neither the means nor the right to extract it from the soil. Those, on the contrary, to whom the laws give the monopoly of the land have no interest in obtaining from it all the subsistence it might produce. In all countries proprietors are opposed, and must be opposed, to any system of cultivation which would tend merely to multiply the means of subsistence while not increasing the revenue. Long before being arrested by the impossibility of finding a country which produced more subsistence population would be checked by the impossibility of finding the people to buy those means or to work and bring them into being.” (Nouveaux Principes, vol. ii, pp. 269-270.)

Ibid., pp. 263, 264.

Nouveaux Principes, vol. i, p. 153.

Ibid., p. 235. This problem of the net and gross produce occupied Sismondi’s attention for a long time. We find a suggestion of it in his first work, Le Tableau de l’Agriculture toscane (Geneva, 1801), and though he does not definitely take the side of the gross produce, he shows some leanings that way. “Why is the gain of a single rich farmer considered more profitable for a State than the miserable earnings of several thousand workers and peasants?” The book, however, is a treatise on practical agriculture, and includes only a few economic dicta. It is here that we have his beautiful description of his farm at Val Chiuso (p. 219).

It is true that Sismondi wished to get rid of the practice of producing corn for a market, so as to free the nation’s food from the fluctuations of that market. Neither is he over-enthusiastic in his praise of the gross produce. He recognises that the gradual growth of the gross produce might, in its way, be the consequence of a state of suffering if population were to progress too rapidly (Nouveaux Principes, vol. i, p. 153). This shows what a hesitating mind we are dealing with.

Ibid., p. 368.

Nouveaux Principes, vol. i, p. 361.

Elsewhere he remarks: “The petty merchants, the small manufacturers, disappear, and a great entrepreneur replaces hundreds of them whose total wealth was never equal to his. Taken altogether, however, they consumed more than he does. His costly luxury gives much less encouragement to industry than the honest ease of the hundred homes which it has replaced.” (Ibid., p. 327). The theory is more than doubtful. What we want to know is whether the demand will remain the same in amount, not whether there will be no change in its character—a contingency that need not result in a general crisis, but simply in a passing inconvenience.

Sismondi applies the same principles to a consideration of a fall in the rate of interest as he does to the growth of production or the increase of machinery. “An increase of capital is desirable only when its employment can be increased at the same time. But whenever the rate of interest is lowered it is a certain sign that the employment of capital has proportionally diminished as compared with the amount available; and this fall in the rate, which is always advantageous to some people, is disadvantageous to others—some will have to be content with smaller incomes and others with none at all.” (Nouveaux Principes, vol. i, p. 393.)

Compare the Saint-Simonian review, Le Producteur, vol. iv, pp. 887-888.

Nouveaux Lundis, vol. vi, p. 81.

Études sur l’Économie politique, vol. i, pp. 60, 61.

Nouveaux Principes, vol. i, p. 341; vol. ii, p. 459.

Ibid., vol. ii, pp. 415, 435. See also Études, vol. i, p. 25.

Nouveaux Principes, vol. ii, pp. 365, 366.

Ibid., p. 451.

Ibid., p. 338.

Nouveaux Principes, vol. ii, p. 661.

Ibid., p. 364.

See section I of present chapter.

Knies, strangely enough, classes him with the socialists.

A. Blanqui, in his Histoire de l’Économie politique en Europe (1837), considers him a writer of the modern school, which he describes as follows: “Writers of this school are no longer willing to treat production as a pure abstraction apart from its influence upon the workers. To produce wealth is not enough; it must be equitably distributed.” (Introd., 3rd ed., p. xxi.)

Droz (1773-1850) published in 1829 his Économie politique, ou Principes de la Science des Richesses. It is in this work that we find the famous phrase, “Certain economists seem to think that products are not made for men, but that men are made for the products.”

Paris, 1841, two volumes. Buret died in 1842, when thirty-two years of age.

It was not intended that any reference should be made in this volume to the doctrine of socialism before the opening of the nineteenth century, but the question whether the French Revolution of 1789 was socialist in character or simply middle-class, as the socialists of to-day would put it, has been so frequently discussed that we cannot ignore it altogether.

There is no doubt that the leaders of the Revolution—including Marat even, who is wrongly regarded as a supporter of that agrarian law which he condemned as fatal and erroneous—always showed unfailing respect for the institution of private property. The confiscation of the property of the Church and of the émigré nobles was a political and not an economic measure, and in that respect is fairly comparable with the historic confiscation of the property of Jews, Templars, Huguenots, and Irish, which in no case was inspired by merely socialist motives. The confiscation of endowments—of goods belonging to legal persons—was regarded as a means of defending individual or real property against the encroachments of merely fictitious persons and the tyranny of the dead hand. When it came to the abolition of feudal rights great care was taken to distinguish the tenant’s rights of sovereignty, which were about to be abolished, from his proprietary rights, which deserved the respect of everyone who recognised the legitimacy of compensation. In practice the distinction proved of little importance. Scores of people were ruined during those unfortunate months—some through mere misfortune, others because of the muddle over the issue of assignats, and others, again, because of the confiscation of rents; but the intention to respect the rights of property remains indisputable still. It would seem that in this matter the revolutionary leaders had come under the influence of the Physiocrats, whose cult of property has already engaged our attention. And how easy it would be to imagine a Physiocrat penning Article 17 of the Declaration of the Rights of Man when it speaks of property as an inviolable, sacred right! But, on the other hand, it is true that Rousseau in his article Économie politique speaks of the rights of property as the most sacred of the citizen’s rights.

It was not only on the question of property that the revolutionists of 1789 showed themselves anti-socialist. They were also anti-socialist in the sense that they paid no attention to class war and ignored the antagonism that exists between capitalists and workers. All were to be treated as citizens and brothers, all were equal and alike.

However, those who claim the most intimate connection with the spirit of the Revolution remain undismayed by such considerations. They endeavour to show that the Revolution was not quite so conservative nor so completely individualistic as is generally supposed, and after diligent search they claim to have discovered certain decrees bearing unmistakable traces of socialism. But a much more general practice is to plead extenuating circumstances. “Are we to demand that the social problems which appeared fifty years afterwards, when industry had revolutionised the relations of capital and labour, should have been solved at the end of the eighteenth century? It would have been worse than useless for the men of 1789 and 1793 to try to regulate such things in advance.” (Aulard, Address to Students, April 21, 1893. Cf. his Histoire politique de la Révolution, chap. 8, paragraph entitled “Le Socialisme.”)

We must not lose sight of the communist plot hatched by François Babeuf during the period of the Revolution. But in this case, at any rate, the exception proves the rule, for, despite the fact that Babeuf had assumed the suggestive name of Gaius Gracchus, he found little sympathy among the men of the Convention, even in La Montagne, and he was condemned and executed by order of the Directory. Babeuf’s plot is interesting, if only as an anticipatory protest of revolutionary socialism against bourgeois revolution. Cf. Aulard, loc. cit., p. 627.

Not to speak of celebrated Utopians like Plato, More, and Campanella, a number of writers who have been minutely studied by Lichtenberger undertook to supply such criticism in the eighteenth century. Morelly, Mably, Brissot, and Meslier the curé in France, and Godwin in England, attacked the institution of property with becoming vigour. Babeuf, who in 1797 suffered death for his attempt to establish a community of equals, has left us a summary of their theories. But the Saint-Simonians owe them nothing in the way of inspiration. Eighteenth-century socialism was essentially equalitarian. What aroused the anger of the eighteenth-century writers most of all was the inequality of pleasure and of well-being, for which they held the institution of private property responsible. “If men have the same needs and the same faculties they ought to be given the same material and the same intellectual opportunities,” says the Manifeste des Égaux. But the Saint-Simonians recognise neither equality of needs nor of faculties, and they are particularly anxious not to be classed along with the Babeuvistes—the champions of the agrarian law. Their socialism, which is founded upon the right to the whole produce of labour and would apportion wages according to capacity, aims neither at equality nor uniformity.

The Saint-Simonians seem to have remained in ignorance of the socialist theories of their contemporaries, the French Fourier and the English Thompson and Owen. Fourier’s work only became known to Enfantin after his own economic doctrine had been formulated. Saint-Simon and Bazard appear never to have read him. It is probable that Enfantin only became aware of Fourier’s writings after 1829, and when he did he interested himself merely in those that dealt with free love and the theory of passions. As Bourgin put it: “If Fourier did anything at all, he has rather hastened the decomposition of Saint-Simonism.” (Henry Bourgin, Fourier, p. 419; Paris, 1905.)

The English socialists are never as much as mentioned. The Ricardian doctrine of labour-value, which is the basis of Thompson’s theory and of Owen’s, and later still of that of Marx, seems never to have become known to them. “Questions of value, price, and production, which demand no fundamental knowledge either of the composition or the organisation of society,” are treated as so many details (Le Producteur, vol. iv, p. 388). Their doctrine is primarily social, containing only occasional allusions to political economy. Enfantin is careful to distinguish between Quesnay and his school and Smith or Say. The Physiocrats gave a social character to their doctrine, which the economists wrongfully neglected to develop. Aug. Comte, in the fourth volume of the Cours de Philosophie, has criticised political economy in almost identical terms, which affords an additional proof of his indebtedness to Saint-Simonism.

Cf. especially Dumas, Psychologie de deux Messies positivistes, Saint-Simon et A. Comte (Paris, 1905), and for biographical details Weill, Saint-Simon et son Œuvre (1894).

Weill, Saint-Simon et son Œuvre, p. 15.

In 1814 De la Réorganisation de la Société européenne, by Saint-Simon and A. Thierry, his pupil; 1817-18, Industrie, in 4 vols. (the 3rd vol. and the first book of the 4th vol. are the work of A. Comte); 1819, La Politique; 1821, Le Système industriel; 1823-24, Le Catéchisme des Industriels (the third book, by A. Comte, bears the title Système de Politique positive); 1825, Le Nouveau Christianisme. Our quotations from Saint-Simon are taken from the Œuvres de Saint-Simon et d’Enfantin, published by members of the committee instituted by Enfantin for carrying out the master’s last wishes (Paris, Dentu, 1865), and from the Œuvres choisies de Saint-Simon, published in 3 vols. by Lemonnier of Brussels (1859).

L’Organisateur, Part I, 1819, pp. 10-20. This passage was republished by Olinde Rodrigues in 1832 under the title of Une Parabole politique in a volume of miscellaneous writings by Saint-Simon, with the result that Saint-Simon was prosecuted before the Cour d’Assises. He was acquitted, however.

“With the enfranchisement of the communes we shall witness the middle classes at last in enjoyment of their liberty, setting up as a political power. The essence of that power will consist in freedom from being imposed upon by others without consent. Gradually it will become richer and stronger, at the same time growing in political importance and improving its social position in every respect, with the result that the other classes, which may be called the theological or feudal classes, will dwindle in estimation as well as in their real importance. Whence I conclude that the industrial classes must continue to gain ground, and finally to include the whole of society. Such seems to be the trend of things—the direction in which we are moving.” (Lettres à un Américain, Œuvres, vol. ii, p. 166.)

“Industry is the basis of liberty. Industry can only expand and grow strong with the growth of liberty. Were this doctrine, so old in fact but so new to many people, once fully grasped instead of those fictitious dreams of antiquity, we should have heard the last of such sanguinary phrases as ‘equality or death.’” (Œuvres, vol. ii, pp. 210-211.)

“Lawyers and metaphysicians are wont to take appearance for reality, the name for the thing.” (Syst. indust., Œuvres, vol. v., p. 12.)

“Parliamentary government must be regarded as an indispensable step in the direction of industrialism.” (Œuvres, vol. iii, p. 22.) “It is absolutely necessary if the transition from the essentially arbitrary régime which has existed hitherto is to be replaced by the ideal liberal régime which is bound to come into being by and by.” (Ibid. p. 21.)

Writing in 1803 in his Lettres d’un Habitant de Genève, he uses the following words: “Everyone will be obliged to do some work. The duty of employing one’s personal ability in furthering the interests of humanity is an obligation that rests upon the shoulders of everyone.” (Œuvres, vol. i, p. 55.)

“I find it essential to give to the term ‘labour’ the widest latitude possible. The civil servant, the scientist, the artist, the manufacturer, and the agriculturist are all working as certainly as the labourer who tills the ground or the porter who shoulders his burden.” (Introduction to Travaux scientifiques, Œuvres choisies, vol. i, p. 221.)

The national or industrial party includes the following classes:

1. All who till the land, as well as any who direct their operations.

2. All artisans, manufacturers, and merchants, all carriers by land or by sea, as well as everyone whose labour serves directly or indirectly for the production or the utilisation of commodities; all savants who have consecrated their talents to the study of the positive sciences, all artists and liberal advocates; “the small number of priests who preach a healthy morality; and, finally, all citizens who willingly employ either their talents or their means in freeing producers from the unjust supremacy exercised over them by idle consumers.”

“In the anti-national party figure the nobles who labour for the restoration of the old régime, all priests who make morality consist of blind obedience to the decrees of Pope or clergy, owners of real estates, noblemen who do nothing, judges who exercise arbitrary jurisdiction, as well as soldiers who support them—in a word, everyone who is opposed to the establishment of the system that is most favourable to economy or liberty.” (Le Parti national, in Le Politique, Œuvres, vol. iii, pp. 202-204.)

Syst. indust., Œuvres, vol. vi, p. 17, note.

Syst. indust., Œuvres, vol. vi, pp. 91-92.

Œuvres, vol. iii, pp. 35-36.

On this point see Halévy’s article in the Revue du Mois for December 1907, Les Idées économiques de Saint-Simon, and Allix, article mentioned supra, p. 117.

In the following passage the opposition is very marked: “One must recognise that nearly all Government measures which have presumed to influence social prosperity have simply proved harmful. Hence people have come to the conclusion that the best way in which a Government can further the well-being of society is by letting it alone. But this method of looking at the question, however just it may seem when we consider it in relation to the present political system, is evidently false when it is adopted as a general principle. The impression will remain, however, until we succeed in establishing another political order.” (L’Organisateur, Œuvres, vol. iv, p. 201.)

Later on the Saint-Simonians abandoned this idea and demanded Governmental control of all social relations. “Far from admitting that the directive control of Government in social matters ought to be restricted, we believe that it ought to be extended until it includes every kind of social activity. Moreover, we believe that it should always be exercised, for society to us seems a veritable hierarchy.” (Doctrine de Saint-Simon, Exposition, Deuxième Année, p. 108; Paris, 1830.)

“Under the old régime men were considered inferior to things,” according to a brochure entitled Des Bourbons et des Stuarts (1822; Œuvres choisies, vol. ii, p. 447). “The object of the new system will be to extend man’s hold over things.” (Œuvres, vol. iv, p. 81.) “In the present state of education what the nation wants is not more government, but more cheap administration.” (Syst. indust., Œuvres, vol. v, p. 181.) Engels, in his book written in reply to Eugen Dühring, makes use of identical terms in speaking of the socialist régime. “When the administration of things and the direction of the processes of production take the place of the governing of persons the State will not merely be abolished: it will be dead.” (Philosophie, Économie politique, Socialisme, French translation by Laskine, p. 361; Paris, 1911.)

Lettres à un Américain, Œuvres, vol. ii, p. 189.

Des Bourbons et des Stuarts, Œuvres choisies, vol. ii, pp. 437-438.

L’Organisateur, Œuvres choisies, vol. iv, pp. 86 and 150-151.

Lettres à un Américain, Œuvres, vol. ii, p. 188.

This is not the only plan of government proposed by Saint-Simon, although it is the one most characteristic of him. It is to be found in L’Organisateur immediately after the Parable. We have to remember that Saint-Simon was very hostile to a Government of savants. Power was to be placed in the hands of the industrial leaders—the savants were simply to advise. “Should we ever have the misfortune to establish a political order in which administration was entrusted to savants we should soon witness the corruption of the scientists, who would readily adopt the vices of the clergy and become astute, despotic quibblers.” (Syst. indust., Œuvres, vol. v, p. 161.)

Syst. indust., Œuvres, vol. vi, p. 96.

F. Engels, Herrn Eugen Dührings Umwälzung der Wissenschaft, 4th ed., p. 277. French translation, Paris, 1911, p. 334. The whole of this chapter in Engels’ book is from the pen of Karl Marx.

French translation under the title L’État socialiste, Paris, 1906.

This is the full text: “The object of socialism is to set up a new system of society based upon the workshop as a model. The rights of the society will be the customary rights of the factory. Not only will socialism stand to benefit by the existence of the industrial system which has been built up by capital and science upon the basis of technical development, but it will gain even more from that spirit of co-operation which has long been a feature of factory life, drawing out the best energy and the best skill of the workman.” Earlier in the same volume he writes: “Everything will proceed in an orderly, economical fashion, just like a factory.” (G. Sorel, Le Syndicalisme révolutionnaire, in Le Mouvement socialiste, November 1 and 15, 1905.)

Saint-Simon often quotes Say and Smith with distinct approval. But he charges Say with the separation of politics from economics instead of merging the former in the latter, and with inability to realise to the full extent what he “dimly saw, as it were, in spite of himself, namely, that political economy is the one true foundation of politics.” (Lettres à un Américain, Œuvres, vol. ii, p. 185.)

Saint-Simon is classed among the socialists for two reasons: (1) the interest he takes in the condition of the poor; (2) his opinions concerning the necessity for reforming the institution of private property. But none of the texts that are generally quoted seem to have the significance that is occasionally given them. With regard to the first point, a celebrated passage from the Nouveau Christianisme is the one usually quoted: “Society should be organised in such a fashion as to secure the greatest advantage for the greatest number. The object of all its labours and activities should be the promptest, completest amelioration possible of the moral and physical condition of the most numerous class.” (Œuvres, vol. vii, pp. 108-109.) Already in his Système industriel Saint-Simon had said that the direct object which he had in view was to better the lot of that class that had no other means of existence than the labour of its own right arm. (Ibid., vol. vi, p. 81.) But is this not just the old Benthamite formula—the greatest good of the greatest number? Besides, how does Saint-Simon propose to secure all this? By giving the workers more power? Not at all. “The problem of social organisation must be solved for the people. The people themselves are passive and listless and must be discounted in any consideration of the question. The best way is to entrust public administration to the care of the industrial chiefs, who will always directly attempt to give the widest possible scope to their undertakings, with the result that their efforts in this direction will lead to the maximum expansion of the amount of work executed by the mass of the people.” (Ibid., vol. vi, pp. 82-83.) A Liberal economist would hardly have expressed it otherwise.

As to the question of private property, Saint-Simon certainly regarded its transformation as at least possible. This is seen in a number of passages. “Property should be reconstituted and established upon a foundation that might prove more favourable for production,” says he in L’Organisateur. (Ibid., vol. iv, p. 59.) Elsewhere, in a letter written to the editor of the Journal général de la France, he mentions the fact that he is occupied with the development of the following ideas: (1) That the law establishing the right of private property is the most important of all, seeing that it is the basis of our social edifice; (2) the institution of private property ought to be constituted in such a fashion that the possessors may be stimulated to make the best possible use of it. (Ibid., vol. iii, pp. 43-44.) In his Lettres à un Américain he gives the following résumé of the principles which underlie the work of J. B. Say (an incidental proof of his attachment to the Liberal economists): “The production of useful objects is the only positive, reasonable aim which political societies can propose for themselves, and consequently the principle of respect for production and producers is a much more fruitful one than the other principle of respect for property and proprietors.” (Œuvres, vol. ii, pp. 186-187.) But all that this seems to us to imply is that the utility of property constitutes its legality and that it should be organised with a view to social utility. Admitting that he did conceive of the necessity of a reform of property, it does not appear that he intended this to mean anything beyond a reform of landed property. We have already seen how he regarded capital as a kind of social outlay which demanded remuneration. The following passage bears eloquent testimony to his respect for movable property: “Wealth, generally speaking, affords a proof of the manufacturers’ ability even where that wealth is derived from inherited fortune, whereas in the other classes of society it is apparently true to say that the richer are inferior in capacity to those who have received less education but have a smaller fortune. This is a truth that must play an important part in positive politics.” (Syst. indust., Œuvres, vol. v, p. 49, note.)

The exact title is Doctrine de Saint-Simon, Exposition, Première Année, 1829. Our quotations are taken from the second edition (Paris, 1830). One ought to mention, in addition to these, the articles contributed by Enfantin to Le Globe and republished under the title of Économie politique et Politique, in one volume (2nd ed., 1832). But none of these articles is as interesting as the Doctrine, and they only reproduce the ideas already discussed by Enfantin in his articles in Le Producteur.

Despite the fact that the oral exposition of the doctrine was the work of Bazard and was prepared for the press by his disciples—Hippolyte Carnot among others—most of the economic ideas contained in it must be attributed to Enfantin. Enfantin also was responsible for the majority of the economic articles that appeared in Le Producteur. But the doctrine set forth in Le Producteur differs considerably from that expounded in the Exposition. Interest and rent are subjected to severe criticism as tributes paid to idleness by industry. Inheritance, on the other hand, though treated with scant sympathy, is not condemned. A lowering of the rate of interest would, Enfantin thinks, help to enfranchise the workers, and a sound credit system would solve the greatest of modern problems—that is, it would reconcile workers and idlers, “whose interests will never again be confused with the general interest, inasmuch as the possession of the fruits of past labour will no longer constitute a claim to the enjoyment of the benefits of labour in the present or future.” (Le Producteur, vol. ii, p. 124.) These ideas are more fully developed in the Exposition.

Doctrine de Saint-Simon, p. 182.

Ibid., p. 190.

Ibid., p. 93.

Sismondi’s term was rather “spoliation.” See supra, p. 185.

“The mass of workers are to-day exploited by those people whose property they use. Captains of industry in their dealings with proprietors have to submit to a similar kind of treatment, only to a much less degree. But they occasionally share in the privilege of the exploiters, for the full burden of exploitation falls upon the working classes—that is, upon the vast majority of mankind.” (Doctrine de Saint-Simon, p. 176.)

“It is our belief that profits diminish while wages increase; but the term ‘wages’ as we use it includes the profits that accrue to the entrepreneur, whose earnings we regard as the price of his labour.” (Le Producteur, vol. i, p. 245. The article is by Enfantin.)

We might sum up the different senses of the word “exploitation” as used by Sismondi, the Saint-Simonians, and Marx respectively as follows:

(1) Sismondi thinks that the worker is exploited whenever he is not paid a wage sufficient to enable him to lead a decent existence. Unearned income seems quite legitimate, however.

(2) Exploitation exists, in the opinion of the Saint-Simonians, whenever a part of the material produce raised by labour is devoted to the remuneration of proprietors through the operation of ordinary social factors.

(3) Marx speaks of exploitation whenever a portion of the produce of labour is devoted to the remuneration of capital either through the existence of social institutions or the operation of the laws of exchange.

See p. 25.

Doctrine, p. 191.

See p. 79, note.

Doctrine, pp. 191-192.

The Saint-Simonians never make use of the term, but they describe the doctrine admirably.

“We may provisionally speak of this system as a general system of banking, ignoring for the time being the somewhat narrow interpretation usually placed upon that word. In the first place, the system would comprise a central bank, which would directly represent the Government. This bank would be the depository for every kind of wealth, of all funds for productive purposes and all instruments of labour—in a word, it would include everything that is to-day comprised within the term ‘private property.’ Depending upon this central bank would be other banks of a secondary character, which would be, as it were, a prolongation of the former and would supply it with the means of coming into touch with the principal localities, informing the central institution as to their particular needs and their productive ability. Within the area circumscribed for these banks would be other banks of a more specialised character still, covering a less extensive field and including within their ambit the tenderer branches of the industrial tree. All wants would be finally focused in the central bank and all effort would radiate from it.” (Doctrine, pp. 206-207.) The idea is probably Enfantin’s, for there is an exposition of the same idea in Le Producteur, vol. iii, p. 385.

Doctrine, p. 210, note. Elsewhere (p. 330): “We are weary of every political principle that does not aim directly at putting the destiny of the people in the hands of the most able and devoted among them.”

“We come back with real joy to this great virtue, so frequently misconceived, not to say misrepresented, at the present time—that virtue which is so easy and so delightful in persons who have a common aim which they want to attain, but which is so painful and revolting when combined with egoism. This virtue of obedience is one to which our thoughts return ever with love,” (Ibid., p. 330.)

The formula in the third edition of the Doctrine is a little different. “Each one,” it runs there, “ought to be endowed according to his merits and rewarded according to his work.” We know that the first part of the formula refers to the distribution of capital, i.e. to the instruments of labour, while the second refers to individual incomes. The word “classed” was substituted for “endowed” in the second edition.

Published as an appendix to the second edition of the Doctrine de Saint-Simon, Exposition, Première Année, 1829.

In his small volume Le Collectivisme (Paris, 1900).

Littré has disputed Comte’s indebtedness to Saint-Simon in his Auguste Comte et le Positivisme. Saint-Simon, however, in his preface to Système industriel remarks that in political matters the jurists form a connecting link between feudal government on the one hand and industrial government on the other, just as the metaphysicians are intermediate between the theological and the scientific régimes. In a note which he adds he states his position still more clearly (Œuvres, vol. v, p. 9). It is true that the Système industriel dates from 1821, and is consequently subsequent to the beginning of the friendly relations between Comte and Saint-Simon. But textual evidence, however precise, cannot decide the question of the reciprocal influence which these two Messiahs exercised upon one another. A similar idea had already found expression in Turgot’s work.

P. 179.

“Another mistake that is also very general is to speak of property as if it were an institution with a fixed, unchangeable form, while as a matter of fact it has assumed various aspects and is still capable of further modification as yet undreamt of.” (Laveleye, De la Propriété et de ses Formes primitives, 1st ed., 1874, p. 381.) Stuart Mill, in a letter addressed to Laveleye on November 17, 1872, congratulated him on the demonstration he had given of this. (Ibid., preface, p. xiii.)

Note this argument, which has so frequently been employed by Liberal economists, and which we shall come across in Bastiat’s work. The Saint-Simonians are constantly running with the hare as well as hunting with the hounds.

Doctrine, p. 182. The historical argument of which we have just given a short summary is developed in the Doctrine, pp. 179-193. It is open to a still more fundamental criticism, inasmuch as it does not seem to be historically accurate.

Saint-Simon, Mémoire introductif sur sa Contestation avec M. de Redern (1812) (Œuvres, vol. i, p. 122).

Doctrine, p. 144.

The philosophy of history might be said to consist of attempts to show that history is made up of alternating periods of organic growth and destructive criticism. The former periods are marked by unity of thought and aim, of feeling and action in society; the latter by a conflict of ideas and sentiments, by political and social instability. The former periods are essentially religious, the latter selfish. Reform and revolution are the modern manifestations of the critical nature of the period in which we live. Saint-Simonism would lead us into a definitely organic epoch. Historical evolution seems to point to a religious and universal association.

Doctrine, p. 119.

Ibid., p. 121. “Man is not without some intuitive knowledge of his destiny, but when science has proved the correctness of his surmises and demonstrated the accuracy of his forecasts, when it has assured him of the legitimacy of his desires, he will move on with all the greater assurance and calmness towards a future that is no longer unknown to him. Thus will he become a free, intelligent agent working out his own destiny, which he himself cannot change, but which he may considerably expedite by his own efforts.”

This is developed at great length in the seventh lecture, Doctrine, pp. 211 et seq.

“Politics,” says Saint-Simon, “have their roots in morality, and a people’s institutions are just the expression of their thoughts.” (Œuvres, vol. iii, p. 31.) “Philosophy,” he remarks elsewhere, “is responsible for the creation of all the more important political institutions. No other power would have the strength necessary to check the action of those that have already become antiquated or to set up others more in conformity with a new doctrine.” (Syst. indust., Œuvres, vol. v, p. 167.) He further insists upon the part which philanthropists may play in the creation of a new society. “One truth,” he writes, “that has been established in the course of human progress is this: a disinterested desire for the general well-being of the community is a more effective instrument of political improvement than the conscious self-regarding action of the classes for which these changes will prove most beneficial. In a word, experience seems to show that those who should naturally be most interested in the establishment of a new order of things are not those who show the greatest desire to bring it about.” (Œuvres, vol. vi, p. 120.) It would be difficult to imagine a neater refutation of Marxian ideas, especially the contention that the emancipation of the workers can only come from the workers themselves.

Cf. on these points Weill, L’École Saint-Simonienne (1896), and Charléty, Histoire du Saint-Simonisme (1896).

“The object of credit,” says Enfantin (Économie politique et Politique, p. 53), “in a society where one set of people possess the instruments of production but lack capacity or desire to employ them, and where another have the desire to work but are without the means, is to help the passage of these instruments from the former’s possession into the hands of the latter.” No better definition was ever given.

Doctrine, p. 226. Cf. p. 223 for an eloquent passage denouncing Ricardo and Malthus, who, as the result of their “profound researches into the question of rent,” undertake to defend the institution of private property.

The article is entitled De la Classe ouvrière, and may be found in vol. iv of Le Producteur. See particularly pp. 308 et seq.

Engels, Herrn Eugen Dührings Umwälzung der Wissenschaft, p. 277.

“The majority of economists, and especially Say, whose work we have just reviewed, regard property as a fixed factor whose origin and progress is no concern of theirs, but whose social utility alone concerns them. The conception of a distinctively social order is more foreign still to the English writers.” (Doctrine, pp. 221 and 223.) No exception is made in favour of Sismondi or Turgot.

Le Producteur, vol. iii, p. 385.

In the preface to Économie politique et Politique, Enfantin again writes: “All questions of political economy should be linked together by a common principle, and in order to judge of the social utility of a measure or idea in economics it is absolutely necessary to consider whether this idea or measure is directly advantageous to the workers or whether it indirectly contributes to the amelioration of their lot by discrediting idleness.” It is a pleasure to be able to concur in the opinion expressed by M. Halévy in his article on Saint-Simon (Revue du Mois for December 1907), in which he maintains that this idea is the distinctive trait of Saint-Simon’s socialism. We have already called attention to another feature that seems to us equally important, namely, the suggested substitution of industrial administration for political government.

It is impossible not to make a special mention of Anton Menger’s excellent little book. Das Recht auf den vollen Arbeitsertrag (1886) (the English translation, with an excellent introduction by Professor Foxwell, is unfortunately out of print). It is indispensable in any history of socialism. We must also mention, with deep acknowledgments, Pareto’s Les Systèmes socialistes (Paris, 1902, 2 vols.)—the most originally critical work yet published on this subject, though not always the most impartial—and Bourguin’s Les Systèmes socialistes et l’Évolution économique (Paris, 1906), as containing the most scientific criticism of the economic theories of socialism.

“Association, which is destined to put an end to antagonism, has not yet found its true form. Hitherto it has consisted of separate groups which have been at war with one another. Accordingly antagonism has not yet become extinct, but it certainly will as soon as association has become universal.” (Doctrine de Saint-Simon, Exposition, Première Année, p. 177.)

In Owen’s paper, the Economist, for August 11, 1821, we meet with the following words: “The secret is out!… The object sought to be obtained is not equality in rank or possessions, is not community of goods, but full, complete, unrestrained co-operation on the part of all the members for every purpose of social life.” Fourier writes in a similar strain: “Association holds the secret of the union of interests.” (Assoc. domestique, vol. i, p. 133.) Elsewhere he writes: “To-day, Good Friday, I discovered the secret of association.”

On the relations of socialism to the French Revolution see the preceding chapter on Saint-Simon (p. 199, note).

The Declaration of the Rights of Man speaks of liberty, property, resistance to oppression, but there is not a word about the right of association. Trade association, one of the oldest and most democratic forms of association, was proscribed by the famous decree of Le Chapelier (1791), and severe penalties were imposed upon associations of more than twenty persons by the Penal Code of 1810. These prohibitions were gradually removed in the course of the nineteenth century. Friendly societies were the first to be set free, then followed trade unions, but these laws were not definitely repealed until July 1, 1901.

“It is obvious that the present régime of free competition which is supposed to be necessary in the interests of our stupid political economy, and which is further intended to keep monopoly in check, must result in the growth of monopoly in almost every branch of industry.” (Victor Considérant, Principes de Socialisme.)

Fourier’s first book, Les Quatre Mouvements, was published in 1808, and his last, La Fausse Industrie, in 1836. Owen’s earliest work, A New View of Society; or Essays on the Formation of Human Character, was published in 1813, and his last work, The Human Race governed without Punishment, in 1858.

“According to details supplied by journalists, Owen’s establishments seem to have at least three serious drawbacks which must inevitably destroy the whole enterprise—the numbers are excessive, equality is one of his ideals, and there is no reference to agriculture.” (Unité universelle, vol ii, p. 35)

Despite the fact that Chartism was essentially a working-class movement, controlled by the Working Men’s Association, its demands were exclusively political, the chief of them being universal suffrage.

It is quite possible that Owen regarded the term as his own invention, but we now know that it had been previously employed by Pierre Leroux, the French socialist. The publication of Owen’s What is Socialism? in 1841, however, is the earliest instance of the term being employed as the title of a book.

Owen lived an extremely active life, and died in 1857 at the advanced age of eighty-seven. Of Welsh artisan descent, he began life as an apprentice in a cotton factory, setting up as a master spinner on his own account with a capital of £100, which he had borrowed from his father. His rise was very rapid, and at the age of thirty he found himself co-proprietor and director of the New Lanark Mills. It was then that he first made a name for himself by his technical improvements and his model dwellings for his workmen. It was at this period that his ideas on education also took shape. By and by it became the fashion to make a pilgrimage to view the factory at New Lanark, and among the visitors were several very distinguished people. His correspondents also included more than one royal personage. Among these we may specially mention the King of Prussia, who sought his advice on the question of education, and the King of Holland, who consulted him on the question of charity.

The crisis of 1815 revealed to Owen the serious defects in the economic order, and this marks the beginning of the second period of his life, when he dabbled in communal experiments. In 1825 he founded the colony of New Harmony in Indiana, and the same year witnessed the establishment of another colony at Orbiston, in Scotland. But these lasted only for a few years. In 1832 we have the National Equitable Labour Exchange, which was not much more successful.

Owen, sixty-three years of age, and thoroughly disappointed with his experiments, but as convinced as ever of the truth of his doctrines, entered now upon the third period of his life, which, as it happened, was to be a fairly long one. This period was to be devoted wholly to propagating the gospel of the New Moral World—The New Moral World being the title of his chief work and of the newspaper which he first published towards the end of 1834. He took an active part in the Trade Union movement, but does not seem to have been much interested in the co-operative experiments which were started by the Rochdale Pioneers in 1844, although curiously enough this is his chief claim to fame.

Owen was in no sense a littérateur, being essentially a man of affairs, and we are not surprised to find that the number of books which he has left behind him is small. But he was an indefatigable lecturer, and wrote a good deal for the press. We must confess, however, that it is not easy, as we read his addresses and articles to-day, to account for the wonderful contemporary success which they had.

There is an excellent French work by Dolléans dealing with his life and doctrines (1907). The best English life, that of Podmore, is unfortunately out of print.

To his fellow-employers who complained of his almost revolutionary proposals Owen made reply as follows—and his words are quite as true now as they were then: “Experience must have taught you the difference between an efficiently equipped factory with its machinery always clean and in good working order and one in which the machinery is filthy and out of repair and working only with the greatest amount of friction. Now if the care which you bestow upon machinery can give you such excellent results, may you not expect equally good results from care spent upon human beings, with their infinitely superior structure? Is it not quite natural to conclude that these infinitely more delicate and complex mechanisms will also increase in force and efficiency and will be really much more economical if they are kept in good working condition and treated with a certain measure of kindness? Such kindness would do much to remove the mental friction and irritation which always results whenever the nourishment is insufficient to keep the body in full productive efficiency, as well as to arrest deterioration and to prevent premature death.”

Education is given a very prominent place in Owen’s system, and once we accept his philosophy we realise what an important place it was really bound to have. Education was to make men, just as boots and caps are made. Were it not altogether foreign to our purpose it would be interesting to compare his educational ideals with those of Rousseau as outlined in Émile.

“The idea of responsibility is one of the absurdest, and has done a great deal of harm.” (Catechism of the New Moral World, 1838.)

On the other hand, Owen had great influence with the working classes, and this he attributed to the fact that, “freed from all religious prejudice, he was able to look upon men and human nature in general with infinite charity, and in that light men no longer seemed responsible for their actions.” (Quoted by Dolléans.)

Like most of the economists and socialists of that time, Owen was very much impressed with the crisis of 1815.

On the other hand, there is this objection:

Whenever profit forms a part of cost of production it is impossible to distinguish it from interest. In that case it is true that even perfect competition would not do away with profit, since it will only reduce the price to the level of cost of production. In that case profit cannot be said to be either unjust or parasitic, for the product is sold exactly for what it cost.

When profit does not enter into cost of production there is no possibility of confusing it with interest. It is simply the difference between the sale price and the cost of replacing the article. In this it is certainly parasitic, and would disappear under a régime of perfect competition, which must to some extent destroy the monopoly upon which such profit rests.

But the distinction between profit and interest was not known in Owen’s time, and Owen would have said that they are both one, and that if profit occasionally claims a share in the cost of production with a view to defying competition it has no right to any such refuge, for cost of production should consist of nothing but the value of labour and the wear and tear of capital. Accordingly it ought to be got rid of altogether.

“Metallic money is the cause of a great deal of crime, injustice, and want, and it is one of the contributory causes which tend to destroy character and to make life into a pandemonium.

“The secret of profit is to buy cheap and to sell dear in the name of an artificial conception of wealth which neither expands as wealth grows nor contracts as it diminishes.”

This contradiction did not escape Owen. But we must not forget that he regarded this merely as a compromise, and that he looked forward to a time when the establishment of a communistic association with a new environment would lead to a complete solution of the problem. He began in the New Harmony colony by making pro rata payment for the work done, but the object was to arrive gradually at a state of complete equality where no distinction was to be made between the service rendered or the labour given—with the result that the colony was extinct in six months.

The Labour Exchange, which was opened in September 1832, at first enjoyed a slight measure of success. There were 840 members, and they even went the length of establishing a few branches. Among the chief causes of the failure of the scheme the following may be enumerated:

(a) The associates, being themselves allowed to state the value of their products, naturally exaggerated, and it became necessary to relieve them of a task which depended entirely upon their honour, and to place the valuation in the hands of experts. But these experts, who were not at all versed in Owen’s philosophy, valued the goods in money in the ordinary way, and then expressed those values in labour notes at the rate of 6d. for every hour’s work. It could hardly have been done on any other plan. But it was none the less true that Owen’s system was in this way inverted, for instead of the labour standard determining the selling value of the product, the money value of the product determined the value of the labour.

(b) As soon as the society began to attract members who were not quite as conscientious as those who first joined it, the Exchange was flooded with goods that were really unsaleable. But for the notes received in exchange for these the authorities would be forced to give goods which possessed a real value, that is, goods which had been honestly marked, and which commanded a good price, with the result that in the long run there would be nothing left in the depot except worthless products. In short, the Exchange would be reduced to buying goods which cost more than they were worth, and selling goods that really cost less than they were worth.

Since the notes were not in any way registered, any one, whether a member of the society or not, could buy and sell them in the ordinary way and make a handsome profit out of the transaction. Three hundred London tradesmen did this by offering to take labour notes in payment for merchandise. They soon emptied the Exchange, and when they saw that nothing valuable was left they stopped taking the notes, and the trick was done.

M. Denis very aptly points out that the Exchange was really of not much use to the wage-earner, who was not even allowed to own what he had produced. There is some doubt after all as to whether the system would prove quite successful in abolishing the wage-earners.

This does not imply that consumers’ associations, when they are better organised and federated, with large central depots at their command, will not take up this project once again—that is, will not try to dispense with money in their commercial transactions. They will certainly keep an eye on that problem.

That was Holyoake’s view (History of Co-operation, vol. i, p. 215). But, according to a passage quoted by Dolléans, Owen contemplated making an appeal to the co-operative societies to come to the rescue of his National Labour Exchange.

To the workers he wrote: “Would you like to enjoy yourselves the whole products of your labour? You have nothing more to do than simply to alter the direction of your labour. Instead of working for you know not whom, work for each other.” (Quoted by Foxwell in his introduction to Anton Menger’s The Right to the Whole Produce of Labour.)

See the lecture on Les Prophéties de Fourier in Gide’s Co-opération.

It is hardly necessary, however, to credit him with a greater amount of eccentricity than he actually possessed, and I seize this opportunity of refuting once more a story told by more than one eminent economist, attributing to him the statement that the members of the Phalanstère would all be endowed with a tail with an eye at the end of it. The caricaturists of the period—“Cham,” for example—represent them in that fashion. The legend doubtless grew out of the following passage from his works, which is fantastic enough, as everybody will admit. After pointing out that the inhabitants of other planets have several limbs which we do not possess, he proceeds: “There is one limb especially which we have not, and which possesses the following very useful characteristics. It acts as a support against falling, it is a powerful means of defence, a superb ornament of gigantic force and wonderful dexterity, and gives a finish as well as lending support to every bodily movement.” (Fausse Industrie, vol. ii, p. 5.)

Nouveau Monde industriel, p. 473.

Letter dated January 23, 1831, quoted by Pellarin, Vie de Fourier (Paris, 1850).

Nouveau Monde industriel, p. 26. For further details see Œuvres choisies de Fourier, with introduction by Charles Gide, and Hubert Bourgin’s big volume on Fourier.

It is necessary to point out that Fourier’s suggestions for a solution of the domestic servant problem are really not quite so definite as we have given the reader to understand in the text. They are mixed up with a number of other ideas of a more or less fantastic description, but very suggestive nevertheless. This is especially true of the suggestion to transform domestic service by making it mutually gratuitous—an idea that is worth thinking about.

We were thinking especially of associations like that of the painters under the leadership of M. Buisson, where distribution is as follows: labour, 50 per cent., capital 27 per cent., administration 12 per cent.

Association domestique, vol. i, p. 466.

Ibid., p. 466. Note that Fourier says that this only applies to civilised societies. For those who live in the future Harmony city there will be other and more powerful motives.

Unité universelle, vol. iii, p. 517.

Ibid., p. 457.

The system of integral association proposed by Fourier, including both co-operative production and co-operative distribution, will be better understood if we look at the facts of the present situation.

On the one hand we have co-operative associations of producers who are not particularly anxious that their products should be distributed among themselves; they simply produce the goods with a view to selling them and making a profit out of the transaction. On the other hand, the distributing societies simply aim at giving their members certain advantages, such as cheaper goods, but they make no attempt to produce the goods which they need.

In countries where co-operative societies are properly organised, as they are in England, for example, many of these societies have undertaken to produce at least a part of what they consume, and some of them have even acquired small estates for the purpose; but only a small proportion of the employees are members of the societies, with the result that their position is not very different from that of other working men. One understands the difficulty of grouping people in this way. But if the associations are to live it is absolutely necessary that they should produce what they require under conditions that are more favourable than those of ordinary producers; in a word, that they should be able to create a kind of new economic environment.

Even in the colonies one does not find many instances of vigorous associations of this kind.

Co-partnership as outlined by M. Briand is to-day an item in the programme of the Radical Democratic party. See Les Actions du Travail, by M. Antonelli.

M. Faguet, Revue des Deux Mondes, August 1, 1896.

“Industrialism is the latest scientific illusion.” (Quatre Mouvements, p. 28.) We must also draw attention to his suggestion for co-operative banks, where agriculturists could bring their harvest and obtain money in exchange for it—a rough model of the agricultural credit banks. But he only regarded this as a step towards the Phalanstère.

The kinds of labour which Fourier selects as examples are always connected with fruit-growing—cherry orchards, pear orchards, etc. Fruit and flowers have a very important place in his writings. He seems to have anticipated the fruit-growing rancher of California.

Without stopping to examine some of the more solid reasons—which unfortunately are buried beneath a great deal of rubbish—why fruit-growing should take the place of agriculture, we must just recall the curious fact that he was always emphasising the superiority of sugar and preserves over bread, and pointed to the “divine instinct” by which children are enabled to discover this. The suggestion was ridiculed at the time, but is to-day confirmed by some of the most eminent doctors and teachers of hygiene.

It is interesting to contrast this view with Bücher’s, who thinks that the evolution of industry simply increases its irksomeness. A conception of regressive or spiral evolution might reconcile the two views.

Let us not forget his Petites Hordes, which consisted of groups of boys who undertook the sweeping of public paths, the surveillance of public gardens, and the protection of animals. The idea was very much ridiculed at the time, but a number of similar organisations, each with its badge and banner, were recently instituted by Colonel Waring in the city of New York.

“My theory is that every passion given by nature should be allowed the fullest scope. That is the key to my whole system. Society requires the full exercise of all the faculties given us by God.”

Quatre Mouvements, p. 194.

See, for example, such works as Zola’s Travail, and Barrè’s L’Ennemi des Lois; and as an example of the general change in the tone of the economists we may refer to Paul Leroy-Beaulieu’s latest writings, in which he speaks of Fourier as a “genial thinker.”

It is no part of our task to relate the story of the several colonies founded either by disciples of Fourier or of Owen. Experiments of this kind were fairly general in the United States between 1841 and 1844, when no less than forty colonies were founded. Brook Farm, which is the best known of these, included among its members some of the most eminent Americans—Channing and Hawthorne, for example—but none of the settlements lasted very long.

Similar attempts have been made in France at a still more recent period. The one at Condé-sur-Vesgres, near Rambouillet, where a few faithful disciples of Fourier have come together, is still flourishing.

Founded in 1859, it only became a co-partnership in 1888, the year of Godin’s death.

As a matter of fact it first appeared as an article in the Revue du Progrès in 1839.

Buonarotti was the author of La Conspiration pour l’Égalité, dite de Babeuf, published in 1828. Little notice was taken of the volume by the public, but it was much discussed in democratic circles.

Organisation du Travail, 5th ed. (1848). p. 77.

We refer to it as the commonest type because in the previous section we have shown that other co-operative societies exist, such as Le Travail, for example, which claims to be modelled upon Fourier’s scheme, especially in the matter of borrowed capital. But the usual type is affiliated to the Chambre consultative des Associations de Production. Article II of its regulations reads as follows: “No one will be allowed to become a subscriber who is not a worker in some branch of production or other.” See the volume published by the Office du Travail in 1898, Les Associations Ouvrières de Production.

In the Journal des Sciences morales et politiques, December 17, 1831. Only one association—the goldsmiths’, in 1834—was founded as the result of this article.

Quoted by Festy, Le Mouvement ouvrier au Début de la Monarchie de Juillet, p. 88 (Paris, 1908).

Buchez’s proposals for the reform of the “great industry” were of an entirely different character.

François Vidal, De la Répartition des Richesses (1846).

“The emancipation of the working classes is a very complicated business. It is bound up with so many other questions and involves such profound changes of habit. So numerous are the various interests upon which an apparent though perhaps not a real attack is contemplated, that it would be sheer folly to imagine that it could ever be accomplished by a series of efforts tentatively undertaken and partially isolated. The whole power of the State will be required if it is to succeed. What the proletarian lacks is capital, and the duty of the State is to see that he gets it. Were I to define the State I should prefer to think of it as the poor man’s bank.” (Organisation du Travail, p. 14.)

“The illusive conception of an abstract right has had a great hold upon the public ever since 1789. But it is nothing better than a metaphysical abstraction, which can afford but little consolation to a people who have been robbed of a definite security that was really theirs. The ‘rights of man,’ proclaimed with pomp and defined with minuteness in many a charter, has simply served as a cloak to hide the injustice of individualism and the barbarous treatment meted out to the poor under its ægis. Because of this practice of defining liberty as a right, men have got into the habit of calling people free even though they are the slaves of hunger and of ignorance and the sport of every chance. Let us say once for all that liberty consists, not in the abstract right given to a man, but in the power given him to exercise and develop his faculties.” (Organisation du Travail, p. 19.)

Cf. pp. 186 et seq.

“Your want of faith in association,” he wrote to the National Assembly of 1848, “will force you to expose civilisation to a terribly agonising death.”

L’Humanité (1840). It would be wrong to conclude, however, that this desire for secularising charity meant that Leroux was anti-religious. On the contrary, he admits his indebtedness for the conception of solidarity to the dictum of St. Paul, “We are all members of one body.”

“I was the first to employ the term ‘socialism.’ It was a neologism then, but a very necessary term. I invented the word as an antithesis to ‘individualism.’” (Grève de Samarez, p. 288.) As a matter of fact, as far back as 1834 he had contributed an article entitled De l’Individualisme et du Socialisme to the Revue encyclopédique. The same word occurs in the same review in an article entitled Discours sur la Situation actuelle de l’Esprit humain, written two years before. See his complete works, vol. i, pp. 121, 161, 378. For a further account of Leroux see M. F. Thomas’s Pierre Leroux (1905), a somewhat dull but highly imaginative production.

For Cabet’s life and the story of Icaria see Prudhommeaux’s two volumes, Étienne Cabet and Histoire de la Communauté icarienne.

“The communists will never gain much success until they have learned to reform themselves. Let them preach by example and by the exercise of social virtues, and they will soon convert their adversaries.”

Protection was attacked by Sismondi in Nouv. Princ., Book IV, chap. 11. He considered it a fruitful source of over-production, and uttered his condemnation of the absurd desire of nations for self-sufficiency. Saint-Simon considered Protection to be the outcome of international hatred (Œuvres, vol. iii, p. 36), and commended the economists who had shown that “mankind had but one aim and that its interests were common, and consequently that each individual in his social connection must be viewed as one of a company of workers” (Lettres à un Americaine, Œuvres, vol. ii, pp. 186-187). The Saint-Simonians never touched upon the question directly, but it is quite clear that Protective rights were to have no place in the universal association of which they dreamt. According to Fourier, there was to be the completest liberty in the circulation of goods among the Phalanstères all the world over. (Cf. Bourgin, Fourier, pp. 326-329; Paris, 1905.)

We refer to two of them only: Augustin Cournot and Louis Say of Nantes. The former, in his Recherches sur les Principes mathématiques de la Théorie des Richesses (1838), a work that is celebrated to-day but which passed unnoticed at the time of its publication, has criticised the theory of Free Trade. But the reputation which he subsequently achieved was not based upon this part of the book. Louis Say (1774-1840) was a brother of J. B. Say. He published a number of works, now quite forgotten, in which he criticised several doctrines upheld by his brother, whose displeasure he thus incurred. We refer to his last work, Études sur la Richesse des Nations et Réfutation des principales Erreurs en Économie politique (1836), for this is the work to which List alludes. It is probable that Louis Say’s name would have remained in oblivion but for List. Richelot, in his translation of List (second edition, p. 477), quotes some of the more important passages of Say’s book.

The union of England and Scotland dates from 1707. Compare the passage in Adam Smith, Book V, chap. 2, part ii, art. 4; Cannan’s edition, vol. ii, p. 384.

List, Werke, ed. Häusser, vol. ii, p. 17. The seventh edition of the National System, which was published in 1883 by M. Eheberg, contains an excellent historical and critical introduction. Our quotations are from the English translation by Lloyd, published in 1885, republished, with introduction by Professor Shield Nicholson, in 1909.

Petition presented to a meeting of the German princes at Vienna in 1820 (Werke, vol. ii, p. 27).

Baden, Nassau, and Frankfort joined in 1835 and 1836. But there still remained outside Mecklenburg and the Free Towns of the Hanse, Hanover, Brunswick, and Oldenburg.

List’s expression “exchangeable value” merely signifies the mass of present advantages—the material profit existing at the moment. It is not a very happy phrase, and it would be a great mistake to take it literally or to attach great importance to it. In his Letters to Ingersoll, p. 186, he gives expression to the same idea by saying that Smith’s school had in view “the exchange of one material good for another,” and that its concern was chiefly with “such exchanged goods rather than with productive forces.” We note that List never speaks of Ricardo, but only of Smith and Say, whose works alone he seems to have read.

“In the Italian and the Hanseatic cities, in Holland and England, in France and America, we find the powers of production and consequently the wealth of individuals growing in proportion to the liberties enjoyed, to the degree of perfection of political and social institutions, while these, on the other hand, derive material and stimulus for their further improvement from the increase of the material wealth and the productive power of individuals.” (National System, p. 87.)

He defines “political or national economy” as “that which, emanating from the idea and nature of the nation, teaches how a given nation, in the present state of the world and its own special national relations, can maintain and improve its economical condition.” (Ibid., p. 99.)

It was the example of England that gave List the idea, but the whole conception is based upon a historical error. England possessed a navy, had founded colonies and developed her international trade long before she became a manufacturing nation. Since the time of List various categories of national development have been proposed. Hildebrand speaks of periods of natural economy, of money economy, and of credit economy (Jahrbücher für National Oekonomie, vol. ii, pp. 1-24). Bücher proposed the periods of domestic economy, of town economy, and of national economy as a substitute (Die Entstehung der Volkswirtschaft, 3rd ed., p. 108). Sombart, in his turn, has very justly criticised this classification in his book Der moderne Kapitalismus (vol. i, p. 51; Leipzig, 1902). But would that which he proposes himself be much better?

No one, we believe, has as yet remarked that List borrowed this enumeration of the different economic states, almost word for word, from Adam Smith. In chap. 5 of Book II, speaking of the various employments of capital, Smith clearly distinguished between three stages of evolution—the agricultural state, the agricultural-manufacturing, and the agricultural-manufacturing-commercial. Smith considered that this last stage was the most desirable, but in his opinion its realisation must depend upon the natural course of things.

The term “normal” is one of the vaguest and most equivocal we have in political economy. It would be well if we were rid of it altogether. What controversies have not raged around the ideas of a normal wage or a normal price! One of the chief merits of the Mathematical school lies in the success with which it has effected the substitution of the idea of an equilibrium price. The idea of a normal nation is about as vague as that of a normal wage, and it is curious that our author describes as normal a whole collection of characteristics which, according to his own account, were at the moment when he wrote only realised by one nation, namely, England.

P. 292. The idea of national power is, moreover, not completely lost sight of by Smith, as is proved by the following passages: “The riches and, so far as power depends upon riches, the power of every country must always be in proportion to the value of its annual produce.… But the great object of the political economy of every country is to increase the riches and power of that country.” (Wealth of Nations,