By JOHN LORD, LL.D.
The material consequences of the discovery of America were brilliant and important. They first stimulated the passion for further explorations, and among all the maritime nations of Europe. Hence the voyages of Ojeda, of Nino, of Puiza, of Balboa, of Vespucci, of Cabot, of Raleigh, and various other men of enterprise. They did not rest until they had explored the coasts and rivers of the whole American continent, north and south. The Spaniards took the lead, and, following in their steps, the Portuguese doubled the Cape of Good Hope, and established their factories in the islands of the Indian Ocean. The Dutch and English were animated by the same zeal, until the East and West Indies were known to travelers and merchants. The French missionaries explored the wilds of the North, and sailed down the Mississippi and the St. Lawrence. In a few years the grand outlines of North and South America were known to geographical scholars. A new world was opened to the enterprise of Europeans. Then followed the conquest of such parts of America as stimulated the ambition and avarice of the Europeans, especially of Spain, who claimed the quarter part of the American continent. These conquests were atrocious, from the cruelties inflicted on the unsuspecting natives, to whom the country belonged. The discovery of the precious metals in Brazil, Peru, and Mexico, and the repute of their abundance, was the cause of these conquests.
At last followed colonization, not so much with a view of permanent settlement or agricultural improvements, as the desire and hope of getting rich in the mines. Colonization had no dignity until the English settled in Virginia and in New England. Gold was the first stimulus, a fertile country the second, and religious liberty the third. The views of those who colonized Virginia were different from those who landed on Plymouth Rock. But all the colonists doubtless sought to improve their condition; and for two hundred years and more the stream of emigration has flowed toward the West. The poor, the miserable, as well as the intelligent and enterprising in all parts of Europe, have regarded America as a refuge and a home.
We next notice an amazing stimulus to commerce, and the enrichment of Spain by the possession of the new mines of silver and gold. Wealth flowed in a steady stream to Spain, and that country became the richest and most powerful in Europe. The Spanish navy became the greatest in the world, and Spain prospered beyond all precedent.
Another interesting inquiry arises, how far the nations of Europe were really enriched by the rapid accumulation of gold and silver. The search for the precious metals may have stimulated commercial enterprise, but it is not so clear that they added to the substantial wealth of Europe, except so far as they promoted industry. Gold is not wealth; it is the exponent of wealth. Real wealth is in farms, and shops, and ships—in the various channels of industry, in the results of human labor.
So far as the precious metals enter into useful manufactures, or into articles of beauty and taste, they are indeed inherently valuable. Mirrors, plate, jewelry, watches, gilded furniture, the adornments of the person, in an important sense constitute wealth, since all nations value them and will pay for them as they do for corn and oil. So far as they are connected with art, they are valuable in the same sense as statues and pictures on which labor has been expended. There is something useful and even necessary besides food and raiment and houses. The gold which ornamented Solomon’s temple, or the Minerva of Phidias, or the garments of Leo X., had a value. The ring which is a present to brides is a part of a marriage ceremony. The gold watch, which never tarnishes, is more valuable inherently than a pewter one, because it remains beautiful. Then when gold enters into ornaments, deemed indispensable, or into manufactures which are needed, it has an inherent value. It is wealth. But when it is a mere medium of exchange—its chief use—then it has only a conventional value. I mean it does not make a nation rich or poor, since the rarer it is the more it will purchase of the necessities of life. A pound weight of gold in ancient Greece, or in mediæval Europe, would purchase as much wheat as twenty pounds weight would purchase to-day. If the mines of Mexico, or Peru, or California had never been worked, the gold in the civilized world three hundred years ago would have been as valuable for banking purposes, or as an exchange for agricultural products, as twenty times its present quantity, since it would have bought as much as twenty times the quantity would buy to-day. Make diamonds as plenty as crystals, they would be worth no more than crystals, if they were not harder and more beautiful than crystals. Make gold as plenty as silver, it would be worth no more than silver, except for manufacturing purposes. It would be worth no more than silver to bankers and merchants. The vast increase in the production of the precious metals simply increased the value of the commodities for which they were exchanged. A laborer can purchase no more bread with a dollar to-day than he could with five cents three hundred years ago. Five cents were really as much wealth three hundred years ago as a dollar is to-day. Wherein, then, has the increase in the precious metals added to the wealth of the world, if a twentieth part of the gold and silver now in circulation would buy as much land, or furniture, or wheat, or oil, three hundred years ago, as twenty times the quantity of gold and silver would buy to-day? Had no gold or silver mines been discovered in America, the gold and silver would have appreciated in value in proportion to the wear of them. In other words, the scarcer the gold and silver the more the same will purchase of the fruits of human industry. So industry is the wealth, not the gold. It is the cultivated farms and the manufactures, and the buildings, and the internal improvements of a country, which constitute its real wealth, since they represent its industry—the labor of men.
Mines indeed employ the labor of men, but they do not furnish food for the body, or raiment to wear, or houses to live in, or fuel for cooking, or for any purpose whatever of human comfort or necessity—only material for ornament, which I grant is wealth so far as ornament is for the welfare of man. The marbles of ancient Greece are very valuable for the labor expended on them either for architecture or ornament.
Gold and silver were early selected as a useful and convenient article of exchange, like bank notes, and so have inherent value as they supply that necessity, but if a quarter part of the gold and silver in existence would supply that necessity, the remaining three-fourths would be as inherently valueless as the paper on which bank notes are engraved. Value consists in what they represent of the labors and industries of men.