The miner is paid by the owner or worker of the mine, for the express purpose of increasing his wealth; the value of the miner’s labour is, therefore, charged with a profit upon the price of the coals; and the result of it would regularly enter into any estimate of national wealth. But when the same owner or worker of coal-mines pays a menial servant for bringing coals up from the yard to the drawing-room, he pays him for the express purpose of facilitating and rendering more convenient and agreeable, the consumption of that wealth which he had obtained through the instrumentality of the miner. The two instruments are used for purposes distinctly different, one to assist in obtaining wealth, the other to assist in consuming it. In an inquiry into the causes of the wealth of nations, I cannot easily conceive a more distinct and useful line of demarcation.
On the same principle, if it be found useful with a view to explanations, to distinguish, by a different name, the stock destined for immediate consumption, from the stock employed or kept, with a view to profit, surely we must not wait to investigate the peculiar talents of each individual, before we venture to characterise the nature of his expenditure; and if we find such men as Arkwright and Watt[[37]] most naturally and properly reserving, for their immediate consumption, the means of keeping up a handsome or splendid establishment for the gratification of themselves, their family, and their friends, make an exception in their favour, and call such an expenditure an outlay of capital, instead of a consumption of revenue, as we should call it in the case of all ordinary persons. Such an inquiry would impose a duty upon the writers in political economy, which it would be perfectly absurd to attempt to fulfil, as it would quite defeat the end of the proposed classifications; and with regard to the distinguished characters adverted to, it would surely be most unnecessary. In an estimate of national wealth, the genius of a Newton or a Milton is necessarily underrated, which only shows that there are other sources of admiration and delight besides wealth. But such men as Arkwright and Watt are quite safe in the hands of the political economist. The result of their genius and labour is exactly of that description which is estimated in the very great addition which it makes to the capital and revenue of the country, in the most natural and ordinary acceptation of these terms. And when the effects of their genius have been estimated in this way, it would not only lead to inextricable difficulty, but it would be obviously a double entry, to estimate, in addition, the value of the men as extraordinary machines. It would be like estimating the value of a commodity produced by a skilful artificer, and then adding his high wages, and putting both into an estimate of national wealth.
But it is difficult to say what may not be called wealth, or what labour may not be called productive, in Mr. Macculloch’s nomenclature. According to his view of the subject, any sort of exertion, or any sort of consumption which tends, however indirectly, to encourage production, ought to be denominated productive; and before we venture to call the most trivial sort of exercise or amusement, such as blowing bubbles, or building houses of cards unproductive, we must wait to see whether the person so employed does not work the harder for it afterwards.[[38]] But, not to mention the impossibility of any, the most useful classification, if such doctrines were admitted, and we were required to wait the result in each particular case, and make exceptions accordingly, I will venture to affirm, that if we once break down the distinction between the labour which is so directly productive of wealth as to be estimated in the value of the object produced, and the labour or exertion, which is so indirectly a cause of wealth, that its effect is incapable of definite estimation, we must necessarily introduce the greatest confusion into the science of political economy, and render the causes of the wealth of nations inexplicable. There is no kind of exertion or amusement which may not, upon this principle, be called productive. Walking, riding, driving, card-playing, billiard-playing, &c. &c. may all be, indirectly, causes of production; and according to Mr. Macculloch, “it is very like a truism, to say, that what is a cause of production must be productive.”[[39]]
But of all the indirect causes of production, the most powerful, beyond all question, is consumption.
If man were not to consume, how scanty, comparatively, would be the produce of the earth. Consumption, therefore, is the main fundamental cause of production; and if we are to put indirect causation on a footing with direct causation, as suggested by Mr. Macculloch, we must rank in the same class, the manufacturer and the billiard player, the producer and the consumer.
It is impossible that the science of political economy should not most essentially suffer from such a confusion of terms. Nothing can be clearer, than that, with a view to any thing like precision, and the means of intelligible explanation, it is absolutely necessary to designate by a different name the labour which is directly productive of wealth, from that which merely encourages it.
Another most extraordinary and inconceivable misnomer of Mr. Macculloch is, the extension of the term labour to all the operations of nature, and every variety of profits.
Adam Smith, and all other writers, who have happened to fall in my way, have meant, by the term labour, when unaccompanied by any specific adjunct, the exertions of human beings; and by the term wages of labour, the remuneration, whether in produce or money, paid to those human beings for their exertions. When Mr. Ricardo stated, that commodities exchanged with each other according to the quantity of labour worked up in them, there cannot be the least doubt that he meant the quantity of human labour immediately employed in their production, together with that portion of human labour worked up in the fixed and circulating capitals consumed in aiding such production. And it is undoubtedly true, referring merely to the relation of one commodity to another, and supposing all other things the same; that is, supposing profits to be the same, the proportion of fixed and circulating capitals to be the same, and the duration of the fixed capitals and the times of the returns of the circulating capitals the same, that then the relative values of the commodities will be determined by the quantity of human labour worked up in each.
But Mr. Macculloch could not but see that it was scarcely possible to take up two commodities, of different kinds, in which all these things would be the same, and, consequently, that such a supposition would be so inapplicable to the mass of commodities, as to be perfectly useless; and yet, without such a supposition, the proposition would be obviously false.
Instead, however, of correcting Mr. Ricardo’s proposition, as he was naturally called upon to do, by adding to the human labour worked up in the commodity, any other element which was found ordinarily to affect its value, and calling it by its ordinary name, he chose to retain Mr. Ricardo’s language, but entirely to alter its meaning. There is nothing that may not be proved by a new definition. A composition of flour, milk, suet, and stones is a plum-pudding; if by stones be meant plums. Upon this principle, Mr. Macculloch undertakes to show, that commodities do really exchange with each other according to the quantity of labour employed upon them; and it must be acknowledged, that in the instances which he has chosen he has not been deterred by apparent difficulties. He has taken the bull by the horns. The cases are nearly as strong as that of the plum-pudding.[[40]]