But the whole of this passage exhibits the influence of the French Physiocrats by whom Adam Smith was inspired, at their worst; that is to say, when they most completely forsook the ground of experience for a priori speculation. The confident reference to "that original state of things" is quite in the manner of the Essai sur l'Inegalie. Now, the state of men before the "appropriation of land" and the "accumulation of stock" must surely have been that of purely savage hunters. As, by the supposition, nobody would have possessed land, certainly no man could have had a landlord; and, if there was no accumulation of stock in a transferable form, as surely there could be no master, in the sense of hirer. But hirer and hire (that is, wages) are correlative terms, like mother and child. As "child" implies "mother," so does "hire" or "wages" imply a
"hirer" or "wage-giver." Therefore, when a man in "the original state of things" gathered fruit or killed game for his own sustenance, the fruit or the game could be called his "wages" only in a figurative sense; as one sees if the term "hire," which has a more limited connotation, is substituted for "wage." If not, it must be assumed that the savage hired himself to get his own dinner; whereby we are led to the tolerably absurd conclusion that, as in the "state of nature" he was his own employer, the "master" and the labourer, in that model age, appropriated the produce in equal shares! And if this should be not enough, it has already been seen that, in the hunting state, man is not even an accessory of production of vital capital; he merely consumes what nature produces.
According to the author of "Progress and Poverty" political economists have been deluded by a "fallacy which has entangled some of the most acute minds in a web of their own spinning."
"It is in the use of the term capital in two senses. In the primary proposition that capital is necessary to the exertion of productive labour, the term "capital" is understood as including all food, clothing, shelter, &c.; whereas in the deductions finally drawn from it, the term is used in its common and legitimate meaning of wealth devoted, not to the immediate gratification of desire, but to the procurement of more wealth—of wealth in the hands of employers as distinguished from labourers" (p. 40).
I am by no means concerned to defend the political economists who are thus charged with blundering; but I shall be surprised to learn that any have carried the art of self-entanglement to the degree of perfection exhibited by this passage. Who has ever imagined that wealth which, in the hands of an employer, is capital, ceases to be capital if it is in the hands of a labourer? Suppose a workman to be paid thirty shillings on Saturday evening for six days' labour, that thirty shillings comes out of the employer's capital, and receives the name of "wages" simply because it is exchanged for labour. In the workman's pocket, as he goes home, it is a part of his capital, in exactly the same sense as, half an hour before, it was part of the employer's capital; he is a capitalist just as much as if he were a Rothschild. Suppose him to be a single man, whose cooking and household matters are attended to by the people of the house in which he has a room; then the rent which he pays them out of this capital is, in part, wages for their labour, and he is, so far, an employer. If he saves one shilling out of his thirty, he has, to that extent, added to his capital when the next Saturday comes round. And if he puts his saved shillings week by week into the Savings Bank, the difference between him and the most bloated of bankers is simply one of degree.
At page 42, we are confidently told that
"labourers by receiving wages" cannot lessen "even temporarily" the "capital of the employer," while at page 44 it is admitted that in certain cases the capitalist "pays out capital in wages." One would think that the "paying out" of capital is hardly possible without at least a "temporary" diminution of the capital from which payment is made. But "Progress and Poverty" changes all that by a little verbal legerdemain:—