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market, it may happen either that no new demand starts up in lieu of that which has ceased ; or that the former machinery, and skill of the former workmen, are unfitted to supply it.

The quantity of producers in a state of society in which industry aided by the greatest artificial means has arrived at a vastly increased production, continues unproportionally to augment in certain channels beyond the consumers.

This has been exhibited by the extraordinary impulse and activity · given to labor, capital and skill in the last thirty years in Great

Britain, to a degree which Adam Smith could not probably have imagined ; and which, if he could have foreseen it, would have induced him to have qualified his exclusive commendations of productive labor. ON THE DIFFERENCE BETWEEN PRODUCTS

AND MONEY. It seems to me that Say errs, not only in giving infinitely too extended a sense to the term products, but that he participates in a much more common error, by confounding Money with the other PRODUCTS, which, as all agree, constitute Riches.

There are two respects, wherein Money, in its character of coin, possesses a most important difference from other PRODUCTS.

First, that it is exclusively received, not on account of the use or pleasure it can administer in right of itself; but for the purpose of procuring something else : that is, merely as an instrument of exchange.

Secondly, that (taking Riches according to the definition I have given) it is a much more perfect species of Riches than any

other : for it has not only a more fixed value in exchange than any other product-but it is ALWAYS exchangeable. This can scarcely be said strictly of any other PRODUCT.

Money then, after all, is the test of exchangeability. Whenever those products, or services, which at another time exchange for Money, cease to be so exchangeable, or are only exchangeable for a lower and unremunerating price, it is a proof that there is a superfluity of them.

Whichever party in the desired exchange cannot command Money' (or that which is immediately exchangeable for MONEY) offers that, which is proved by this test, to be superabundant.

1 But it must not be inferred from hence, that every thing, when it can command money, such as labor, is then and therefore riches. The money is riches, as soon as receiver, to him who has earned it; but the labor is not therefore riches to him to whom that Jabor is given in exchange. The quality possessed in common by the things mutually transferrer, is er. changeability: but exchangeability is only one quality of riches.

This is a simple clue, by which to judge of the soundness of Say's reasonings. He uses essential words in so loose and unlimited a sense in his first letter to Malthus, that they mean every thing, and nothing ; and throughout he is so confused, inconsistent, and contradictory, that it is impossible to pursue his errations.

Whatever product ceases to be exchangeable for money, because it is superfluous, ceases to be Riches ; whether the superfluity arises from want of means, or want of will to acquire it.

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Sound and clear as is the distinction between PRODUCTive and UNPRODUCTIVE LABOR made by Adam Smith, whatever may be the attempts of the new school to shake it, yet the spirit of its very principle instructs us to refrain from carrying it to the literal extent, to which many indiscriminate followers of this master of the science are inclined to push it.

By productive labor is meant labor productive of Riches. There is a point of multiplication beyond which production ceases to be Riches:' for to be Riches, it must have an exchangeable or mai ketable value : but when it is brought forth in quantities unproportionally large, no demand for this excess can be found either because there is no want of it, or because they, who want it, have no means to pay for it.

A disregard of this most important distinction has led many writers and many debaters on this subject into opinions, which every day's experience, as well as all solid reasoning, refutes. Mere quantity of production, whether from fertility of soil, or from human industry, does not constitute Riches. That augmentation, which forms a glut of the market, is not only not a gain; it is a loss. ON THE THINGS DENOMINATED IMMATERIAL

RICHES BY M. SAY. If M. SAY had called the unproductive services and other things to which he gives the title of IMMATERIAL Riches, one portion of the means or stimulant of Riches by adding to the funds applicable to the exchange with Riches, his classification would have been both just and useful. But there is still less identity between Riches and the means of Riches, than there is between Riches and the Ingredient of Riches. In the latter case, who would say

* The practical truth of this must be familiar to the public, on the smallest consideration. .

When commodities come first into the trader's warehouse from the manufacturer, they are estimated at a value, of which the measure is the market price. What remains in the warehouse alier the demands of the market are satisfied, becomes of little more value than waste.

2 M. SAY is so far froin yielding to Malthus's objection to his Immaterial Riches, that the objection stimulates him to an infinite extension, instead of retraction, of this doctrine. He is no longer content with a portion of Immaterial Riches: be insisis that all Riches are Immaterial!! His reasoning on this point is curious. He says, that Man cannot add an atom to matter: he can only decompose, and recompose it! He then asserts, that I can distinyuish between material and immuterial labor. Labor of both kinds may be productive ; and of both kinds unproductive. But Labor is not Riches: it is only an ingredient of Riches; and that only when taking a párticular direction, and applied !o certain objects.

that the bricks, the stones, the tiles, the timber, of which a building consists, are therefore themselves a building ?

I agree with M. Say, that a large portion of the things thus named by him, are greatly contributory to Riches. I am firmlypersuaded, that they are contributory, when those things which, as soon as they are increased unproportionally, and exceed a certain point, are improperly called produclive, ccase to be contributory.

Yet they are only indirectly contributory: they do not form part of the production itself; they only assist in directing the means of exchange into more advantageous channels.

But (as Malthus says of Lord Lauderdale's definition of Riches) an investigation of the nature and causes of all sorts of Riches i would pass the bounds of a single science. Still, among these causes, that of Unproductive Labor in a nation where agricultural and manufacturing riches have been raised to a great abundance, requires a new examination far more profound than it has yet received

Malthus, uniting the most temperate investigation with the most enlightened views, seems to see this subject inits true colors. But the present crisis of Europe, and especially of Great Britain, demands for it a developement yet unattempted.

I am myself prepared to apply it to the Poor Laws, in a way which seems to me the only probable remedy, or palliation, of that ruinous system : but as it will take the space, time, and laborious digestion of a volume, I forbear to give an imperfect anticipation of it in these brief observations.

So long as the public will niistake means for ends : so long as they will believe that Riches are valuable for themselves, and not for an ulterior object; so long as they will act as if endless accu. mulation were preferable to refined and innocent enjoyment, so the result and end of this change of form is utility: but, (hie continues) utility is an immaleriul quality; therefore Riches are immaterial !!!

Or rather he should liave said, of all that is useful, or agreeable to human 2 M. Sismondi's opinions appear to be the same as I have here advocated, on this topic of primary interest.


long will they mistake the road to the very object they have in view.

Till there is an annual surplus of capital, . beyond the income necessary for annual consumption, and beyond also what is farther necessary to be applied to the purposes of reproduction, unproductive services are not merely a loss, but an injury to the due nurture of Riches. But when they arrive at that point, the character of their value is greatly altered. By causing a more beneficial distribution of this existing surplus, they furnish a market for produce, that would otherwise be excessive, instead of adding to that


There can be no doubt, that the end of wealth is, first to supply necessities; and, secondly, luxuries. It can never be said to be abundant, or even sufficient, till it is adequate to the last effect. Such intellectual services as are directed merely to intellectual production, the arts, which gratify at once the senses and the mind, are objects, which it is the business of the highest stage of Riches to support and foster. But gratifications much less refined and praise-worthy than these are still among the proper ends of Riches. Furniture, equipages, domestic servants, and all the apparatus of splendid or convenient establishments, are among the modes in which the distribution of great wealth is not only desirable, but requisite to retain it at its height.

I do not therefore complain of M. Say for dwelling on these things as very important to the subject he was discussing, and mainly connected with Riches; but because he indentifies them with Riches themselves.


If the reasoning hitherto produced be just, it is the MODE OF ACCUMULATION rather than Accumulation itself that is objectionable, inasmuch as it argued not to answer its purpose. But I must confess that grave and powerful evils are incident to the only mode of accumulation which appears to me to be compatible with the present vastly augmented agricultural and manufactured produce, and vastly augmented amount both of productive and unproductive population.

The demanded extent of annual expenditure can only be kept up by an increased consumption of capital, viz. in the language commonly made use of, by living in part upon the principal. And this can only be done by loans and taxation. Now, though I do not doubt that there is a reproduction in this case more than equal to the consumption, the reproduction comes into different hands; and therefore causes a frightful change of property.

Statesmen must choose between this evil, and that of the agricultural and manufacturing population out of employ; and the consequent depression and distress of landed and commercial capital.



I say, that our present Distresses arise from a want of employment of the Non-productive Laborers, caused both by our diminished expenditure and the altered channels of our expenditure; and by the decreased employment of Productive Laborers arising from the decreased means of the Non-productive.

All the other commonly-assigned causes are quite inadequate to the effects which we have witnessed. The causes most generally dwelt upon are taxation, altered value of currency, and increased production.

That taxation could not be the cause is clear, because price and prosperity of agriculture, manufactures, and commerce, continued to increase during the whole period that taxation went on at a rapid progress.

The utmost and most exaggerated result of altered value of currency would have been a reduction in price of 20 per cent., at which price the demand would have been equally brisk.

That there has been no increased production either of agricultural or manufactured commodities, since the termination of the war—but on the contrary, a great diminution-cannot be ques. tioned.

But when there came a diininution of expenditure of at least 40 millions a year, which had hitherto been paid among the army and navy,

and other costs of war, then the demands in the cornmarket i and manufacture-market were curtailed to an amount, which bore no inconsiderable proportion to that sum.

Either then an expenditure equal to the employment of the first of these classes (the non-productive), which will bring with it the employment of the second, must be resorted to; or this unemployed population must remain not only a burden, instead of a benefit, but a new burden upon an expenditure diminished twofifths.

The only other alternative, which my mind presents to me is

· I am aware that in the Agricultural Report (June 1821,) the demand and consumption of corn is argued to remain the saine, except so far as pleoti. ful means encourage wastewhich is there stated to be very iriding in its effect; ---a position very strange to my apprehension. I know, that the unemployed must still be fed; but surely in a measure vastly stinted.

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