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been employed as currency, with the exception of Platinum, the great demand for which metal in the arts, occasioned such very large supplies of it to be procured from the ores, as to depreciate the value of this metal as specie. The values affixed to the Platinum coins of Russia, are much above the actual market value of the metal itself.
If it should happen at any time, that by the discovery of some new uses for the precious metals, in chemistry and the arts, a very large quantity of them should be withdrawn from circulation and consumed in manufacture, a proportionate rise would be felt in the value of specie, and a relative depreciation in the value of purchaseable commodities. Thus it appears, that the value of gold and silver depends, other things being equal, on its abundance or scarcity in the market.
But there are other causes of variation in the value of gold and silver. For the purposes of commerce, and for the ordinary purchase of commodities at retail, a certain amount of exchangeable property in a convenient form is needed, that can be passed readily from hand to hand. The precious metals are preferred for this purpose, and the relative value which they bear to each other is ascertained and stamped upon equal pieces of them by the government. A certain weight of silver represents one hundred pieces of a certain weight of copper. A certain weight of gold represents ten pieces of a certain weight of silver; that is to say, so much gold will purchase so much silver or copper, and so much silver will purchase so much gold or copper. The adjustment of the coinage consists chiefly in ascertaining the relative values of the three metals in use, and giving to the coined pieces of each metal, a decimal relationship to those of other metals. If, for example, copper, through great abundance, should fall to half its present value, and it was considered necessary still to make the copper coin represent one hundredth part of the silver dollar, a new coinage would have to be made of copper, either doubling the size of the present cent, or making it, with its present size, represent a half cent; and so of the other metals used as specie. But there are still other causes of fluctuation in the value of the metals used for currency. Let us suppose that by an act of all
the governments of the states, it was forbidden to use bank notes under the denomination of ten dollars; it would then follow that the multifarious businesses, which are now carried on by the medium of a paper currency of small notes, would be transacted in coin; and a much larger quantity of coin would be needed than is at present in use; the need would increase the value of that coin which happened to be available at the time, and the value of gold, silver and copper coins would have a sensible rise in all parts of the country. Thus we see that the value of metals, used as currency, is given to them by several causes :
1. Their uses in chemistry, and in the arts, and
2. Their relative abundance or scarcity, as a medium of exchange.
Again. Their values fluctuate— 1. Relatively to each other, and 2. Relatively to purchaseable commodities.
When it becomes necessary, in consequence of a balance of trade against us, to remit large amounts of specie to Europe, the precious metals experience a rise in value, in consequence of the insufficiency of what is left to meet the ordinary necessities of the market.
When, on the contrary, the balance of trade is in our favor, and foreigners purchase largely of us with specie, the precious metals experience a fall, because there is more than enough for all the purposes of life.
When there is a great abundance of the precious metals in this country, and a relative scarcity in Europe or Asia, they are sent abroad for the purchase of foreign commodities; because at such times, a dollar will buy more in foreign countries, than it will at home; and thus, a scarcity of coin in foreign countries, occasioning a free exportation of specie, will make a balance of trade against us, greatly to our advantage; it is therefore necessary to make due allowance for this circumstance, in judging whether the state of our trade with foreigners is favorable or unfavorable to ourselves. Let us suppose for example, that by the creation of a great number of new banks, a vast quantity of paper currency was thrown out upon the markets, composed of small bills; and that these
As it is the object both of the producer and the consumer, to secure for themselves the largest possible share of the surpluses of industry, which, by the intervention of trade and commerce, are greatly diminished, it is equally for their interest to deal justly with each other, without the intervention of brokers, tradesmen, and speculators. This idea has given rise to combinations of artisans, who abandoning the old plan of forcing the master to pay them higher wages, and of persecuting those workmen who would allow themselves to be employed for insufficient wages, have discovered that by a judicious combination, they may escape entirely out of the power of the master workman, and bring themselves in a direct contact with the purchasing public, in other words, with the consumers.
If the journeyman artisan can supply the market, without the intervention of a merchant or employer, he saves to himself a portion of that profit which would come to the employer. If the employer makes ten per cent. by selling the labor of his journeyman, that loss is divided between the buyer and the journeyman; but if the journeyman is able to supply the customer directly, and without the intervention of a third party, the purchaser will obtain the goods at a lower rate, and the journeyman will obtain a higher wage; and so both parties are the gainers by dispensing with the dealer or master workman.
Suppose that a suit of clothes costs twenty-five dollars, five of which go to the
profit of the merchant tailor; a combination of journeymen working and selling in a shop of their own, can divide this profit between themselves and the buyer; selling the clothes for two dollars and a half less price, and reaping two dollars and a half advantage to themselves. If a combination of miners can establish a furnace, smelt their own ores, and sell their own products, they are enabled to divide the profits which would otherwise go to the capitalist, between themselves and the purchasers.
If an hundred artisans can combine for the erection of a village of their own, or of a dwelling house in the city large enough to contain them all, they save to themselves all the profits of rent, and are thus enabled to purchase more of the comforts of life, and escape the dangers of ejectment from inability to pay rent.
If several farmers can combine for the cultivation of a single great farm, the same stock and labor can be employed upon the whole, and with such a saving of time, and such an economical distribution of labor and capital, as to insure a much larger profit, and subject to fewer contingencies and losses. Such is the new principle of the organization of industry, agitated by the new economists, and it is hard indeed to discover any fallacy in the reasoning which they employ to establish it.
Combinations of this kind require to be undertaken with caution, and to be conducted with extreme economy and integri
ty: whether they succeed or not, seems to depend entirely upon the intelligence, prudence and honesty of those who engage in them, and not upon any inherent difficulty in the system itself.
Let us suppose, for example, that a number of farmers agree to establish for themselves a store in their vicinity, which shall also be a place of deposit for the sale of the products of their farms: the manager of the store will require indeed to be supported out of their joint surpluses, and the prices paid by purchasers; the goods deposited in his care, being no property of his, the temptation to fraud on his part will be infinitely less than if he were, at once, the buyer and seller of all that pass through his hands.
As it might not be advantageous to maintain such a person by a salary, let us suppose that he is paid by a certain per centage of the profits; this per centage being regulated by an agreement between himself and the parties who employ him. Every farmer in the neighborhood would leave with the person an account of the products which he had to dispose of. This would be a necessary function of the agent in this labor and profit saving scheme, and constitute him a commission merchant, a person whose duties are already thoroughly understood and defined; nor is it probable that any improvement could be theoretically suggested for the better management of commission.
All that is advanced by the new theory, is a reduction of those enormous profits of the commission merchant, by subjecting him to the immediate supervision of a combination of producers. A wealthy combination of producers making large profits themselves, a circumstance which would happen of course, would, however, willingly allow their commissioner to make large profits indeed, were he ever so much under their direction and influence, the superior knowledge which he would soon acquire, would make them dependent upon him in a measure, and that too, in the proportion of the service which he rendered them.
On the other hand, it would be his duty, under the new theory, to purchase for them either with their capital, or by the barter of their commodities, those luxuries and comforts for which their surplus is to be
exchanged; and here again the superior knowledge and keenness of the agent gives him an unavoidable advantage over his employers, and his salary must be increased or his per centage augmented in proportion to the wealth and the profits of those for whom he acts.
We see, therefore, that the inequality of gain is a circumstance unavoidable under the present system, however exactly and judiciously organized. In fact, we are driven to the conclusion, that the new theorists are not indeed theorists, but only reformers, who, accepting the established modes and processes of commerce, desire only to give them a better shape, excluding what is irregular and mischievous, extending what is permanent and valuable, and in fine, perfecting the economical arrangements of society as they exist among ourselves.
Stripped of that ridiculous accompaniment of metaphysics and false science, with which it has been invested by Fourier and his followers, the organization of labor seems to be an effort merely to insure to industry and ability their just reward. There is indeed a science of business, and that science is economy-the law of the household; and its principles are one and the same for families, villages, towns, cities, states, and nations, under the regulation of that mind which is undefinable, that universal reason which distinguishes men above the brutes.
The first principle of economy, is doubtless, the simple necessity that the individual shall exist, that he shall sustain himself: The second, that he shall not injure, but benefit his neighbor. Justice only forbids an injury, and restrains the individual to the limits assigned him by reason and circumstance. Economy commands a benefit, and extends the activity of the individual for the good of others.
Nothing serves to illustrate the objects and principles of public economy more perfectly than the two propositions which have been already dwelt upon. The proposition, first, that the consumer and producer should be near together, to escape the losses and delays of transportation; and proposition, second, that the exchange of surpluses, between consumer and producer, should be through the fewest possible hands.
It is the fashion of a certain school of miscalled economists to look upon the
movements of commodities in the market, as they do upon the motions of the heavenly bodies, and to regard the fluctuations of supply and demand, and the incomings and outgoings of specie, as they do the the rush of a cataract, or the flow of a mighty river, with a childish awe. These awe-stricken theorists are content with observation and a theory; and their conclusions, like those of Pyrrho of old, end always in a doubt, and forbid all action. These are our free traders, our men of laissez faire, whose unfruitful science ends only in negation, and forbids advance. How unlike that science of the moderns, which ever dissipates the doubt, and leads boldly on to action; whose lamp is reason, and whose pioneer is experiment; whose spirit is beneficence, and its aim, the increase, the union, and the happiness of mankind. Justly might we say of skeptical free trade science, that it is a science of despair; it is doubt applied, -Pyrrhonism made a principle of legislation, jealousy put up for justice.
It is a mysterious working of human conceit that men should glory in their own incapacity; and yet none are more conceited than those who make ignorance a point of merit. These are your practical men, as they fondly style themselves, in whom there is no practice, and who fancy they have ascended to the summit of knowledge, when they have calculated the probabilities of an excess of population, or a dearth of corn: their activity ends with their theory; they are a kind of Haruspices, whose business it is to peep into the entrails of the state, and thence to predict disaster. Their ravens fly ever on the unlucky side; their proceedings are a farce to delude the people.
With these false economists, the functions of a government are reduced to the regulation of army, navy, and police; and to the collection of taxes; while the true economist endeavors to impart to government a beneficent and protecting, as well
as a coercive power. As the acts of government necessarily have a powerful effect upon the business of the country, and the government, by necessity, employs larger sums, and transacts more business than an hundred of the wealthiest corporations, the direction of its conduct is of vast moment, as it affects the agricultural, commercial, and manufacturing interests. The policy of free trade is wholly to neglect these effects, and to drive the great engine of the state through the private domains of industry with a perfect scorn of consequences.
Government, established for the benefit of the people, is made wholly to disregard them, and to think only of itself: it is made to perform its duty, like some inferior functionary of the law, as if it were a piece of mechanism and not a moral
But on such a topic figures of rhetoric are in vain. It is necessary for the true economist to use the language of economy, and by the management of the farm and the workshop to illustrate the management of the state. Hitherto the state has been exemplified by the image of a man clad in armor, with weapons of offence in his hand : but as the spirit of christianity gradually softens and tempers the spirit of the people, those old heathenish rules of conquest and violence have to give way to wiser and gentler maxims. Justice is but the left hand of government, industrial polity its right. The people are not now, as formerly, to be looked upon as a herd of serfs, whom to govern and keep down is the prime duty of legislation. Armies now are for defence and not for conquest. As society advances the citizen lays aside his weapons and attends to his affairs in peace. He has leisure for industry and economy, and as the free state is the abstract of all that makes the freeman,-it should be made to resemble him in all particulars, except that of a selfish individuality.