[178-4] "Every one has a right to live. We will suppose this granted. But no one has a right to bring creatures into life to be supported by other people. Whoever means to stand upon the first of these rights must renounce all pretension to the last.... Posterity will one day ask with astonishment what sort of people it could be among whom such preachers could find proselytes." (J. S. Mill, Principles, II, ch. 12.)
[178-5] Compare Morrison, loc. cit. Quarterly Rev., Jan. 1872, 260. The English savings in the savings banks, between 1839 and 1846, increased yearly in amount only £1,408,630, and scarcely half of this came from wages-workmen in the narrower sense of the term. What the latter contribute to the fund for the old and sick is not really productive capital but only individually deferred consumption. Let us suppose that a man had an income of $3,000 a year, of which he laid out yearly $2,000 ($1,000 for wages, $1,000 for rent and interest[TN 18] on capital), and that he capitalizes $1,000. If now this man were, either through philanthropy or in furtherance of socialism, to double the wages he paid, the result would not be detrimental to the economic interests of the whole country only on the supposition that working classes who received the increased wages should either save what he is no longer able to save, or that by inventions or greater personal skill, etc., they should increase the national income.
[178-6] According to Hildebrand's Jahrbb., 1870, I, 435, 193, North American workmen, the quality of work being supposed the same, now accomplish from 20 to 30 per cent. less than before 1860. Thus, in 1858, in New York, a steam engine was manufactured for $23,000, in 2,323 work days. In 1869, a similar one was built for $40,000 in 3,538 days. In the former case, the manufacturer made a profit. In the latter, he lost $5,000.
John Stuart Mill, II, ch. 13. Against the "philanthropists" who find it hard to preach to the poor, the only efficacious means of improving their condition, Dunoyer, L. du T., IV, ch. 10, says: The rich do employ it, although they have much less need of it! Even Marlo admits that a guaranty of the right to labor, without any measures to limit population, would, in a short time, and irredeemably lead the country to destruction. (Weltökonomie, I, 2, 357.) von Thünen, der isolirte Staat., II, 1, 81 ff., would take a leap out of the vicious circle that those who live by the labor of their hands can produce no rise in their wages, because they are too little educated to hold their increase properly in check; and that, on the other hand, they cannot give their children a decent education, because their wages are too low; by suggesting that educational institutions should be established by the state, and that these should elevate the subsequent generation of workmen intellectually.
CHAPTER IV.
INTEREST ON CAPITAL.
THE RATE OF INTEREST IN GENERAL.
Interest on capital,[179-1] or the price paid for the use of capital, should not be confounded with the price of money (§ 42); although in common life people so frequently complain of want of money where there is only a want of capital, and sometimes even when there is a superabundance of money.[179-2] This error is connected with the fact, that for the sake of convenience, loans of capital are so often effected in the form of money and that they are always at least estimated in money; but neither of these things is essential.
In reality, however, we as seldom meet with interest[179-3] pure and simple, as we do with rent pure and simple. A person who works with his own capital can, at best, by a comparison with others, determine where, in the returns of his business, wages stop and interest begins.[179-4] And even in the loaning of capital, it depends largely on supply and demand, whether the creditor shall suffer a deduction in consequence of the absence of care and labor attending his gain, and whether the debtor, in order to get some capital at all, shall sacrifice a part of the wages of his labor.[179-5] When Adam Smith assumes it to be the rule that the "profit of stock" is about twice as great as the "interest of money,"[179-6] it is evident that a considerable amount of what is properly wages or profit of the employer (Uhternekmer = undertaker) is included in the former.