Essays on Political Economy Part 7

_It is not seen_, that if James farms instead of digging, John will be reduced to the necessity of digging instead of farming.

That, consequently, what was considered an increase of loan, is nothing but a displacement of loan. Besides, _it is not seen_ that this displacement implies two acts of deep injustice.

It is an injustice to John, who, after having deserved and obtained _credit_ by his honesty and activity, sees himself robbed of it.

It is an injustice to the tax-payers, who are made to pay a debt which is no concern of theirs.

Will any one say, that Government offers the same facilities to John as it does to James? But as there is only one plough to be had, two cannot be lent. The argument always maintains that, thanks to the intervention of the State, more will be borrowed than there are things to be lent; for the plough represents here the bulk of available capitals.

It is true, I have reduced the operation to the most simple expression of it, but if you submit the most complicated Government inst.i.tutions of credit to the same test, you will be convinced that they can have but one result; viz., to displace credit, not to augment it. In one country, and in a given time, there is only a certain amount of capital available, and all are employed. In guaranteeing the non-payers, the State may, indeed, increase the number of borrowers, and thus raise the rate of interest (always to the prejudice of the tax-payer), but it has no power to increase the number of lenders, and the importance of the total of the loans.

There is one conclusion, however, which I would not for the world be suspected of drawing. I say, that the law ought not to favour, artificially, the power of borrowing, but I do not say that it ought not to restrain them artificially. If, in our system of mortgage, or in any other, there be obstacles to the diffusion of the application of credit, let them be got rid of; nothing can be better or more just than this.

But this is all which is consistent with liberty, and it is all that any who are worthy of the name of reformers will ask.

X.--Algeria.

Here are four orators disputing for the platform. First, all the four speak at once; then they speak one after the other. What have they said?

Some very fine things, certainly, about the power and the grandeur of France; about the necessity of sowing, if we would reap; about the brilliant future of our gigantic colony; about the advantage of diverting to a distance the surplus of our population, &c. &c.

Magnificent pieces of eloquence, and always adorned with this conclusion:--"Vote fifty millions, more or less, for making ports and roads in Algeria; for sending emigrants thither; for building houses and breaking up land. By so doing, you will relieve the French workman, encourage African labour, and give a stimulus to the commerce of Ma.r.s.eilles. It would be profitable every way."

Yes, it is all very true, if you take no account of the fifty millions until the moment when the State begins to spend them; if you only see where they go, and not whence they come; if you look only at the good they are to do when they come out of the tax-gatherer's bag, and not at the harm which has been done, and the good which has been prevented, by putting them into it. Yes, at this limited point of view, all is profit.

The house which is built in Barbary is _that which is seen_; the harbour made in Barbary is _that which is seen_; the work caused in Barbary is _what is seen_; a few less hands in France is _what is seen_; a great stir with goods at Ma.r.s.eilles is still _that which is seen_.

But, besides all this, there is something _which is not seen_. The fifty millions expended by the State cannot be spent, as they otherwise would have been, by the tax-payers. It is necessary to deduct, from all the good attributed to the public expenditure which has been effected, all the harm caused by the prevention of private expense, unless we say that James B. would have done nothing with the crown that he had gained, and of which the tax had deprived him; an absurd a.s.sertion, for if he took the trouble to earn it, it was because he expected the satisfaction of using it. He would have repaired the palings in his garden, which he cannot now do, and this is _that which is not seen_. He would have manured his field, which now he cannot do, and this is _what is not seen_. He would have added another story to his cottage, which he cannot do now, and this is _what is not seen_. He might have increased the number of his tools, which he cannot do now, and this is _what is not seen_. He would have been better fed, better clothed, have given a better education to his children, and increased his daughter's marriage portion; this is _what is not seen_. He would have become a member of the Mutual a.s.sistance Society, but now he cannot; this is _what is not seen_. On one hand, are the enjoyments of which he has been deprived, and the means of action which have been destroyed in his hands; on the other, are the labour of the drainer, the carpenter, the smith, the tailor, the village schoolmaster, which he would have encouraged, and which are now prevented--all this is _what is not seen_.

Much is hoped from the future prosperity of Algeria; be it so. But the drain to which France is being subjected ought not to be kept entirely out of sight. The commerce of Ma.r.s.eilles is pointed out to me; but if this is to be brought about by means of taxation, I shall always show that an equal commerce is destroyed thereby in other parts of the country. It is said, "There is an emigrant transported into Barbary; this is a relief to the population which remains in the country," I answer, "How can that be, if, in transporting this emigrant to Algiers, you also transport two or three times the capital which would have served to maintain him in France?"[4]

The only object I have in view is to make it evident to the reader, that in every public expense, behind the apparent benefit, there is an evil which it is not so easy to discern. As far as in me lies, I would make him form a habit of seeing both, and taking account of both.

When a public expense is proposed, it ought to be examined in itself, separately from the pretended encouragement of labour which results from it, for tins encouragement is a delusion. Whatever is done in this way at the public expense, private expense would have done all the same; therefore, the interest of labour is always out of the question.

It is not the object of this treatise to criticise the intrinsic merit of the public expenditure as applied to Algeria, but I cannot withhold a general observation. It is, that the presumption is always unfavourable to collective expenses by way of tax. Why? For this reason:--First, justice always suffers from it in some degree. Since James B. had laboured to gain his crown, in the hope of receiving a gratification from it, it is to be regretted that the exchequer should interpose, and take from James B. this gratification, to bestow it upon another.

Certainly, it behoves the exchequer, or those who regulate it, to give good reasons for this. It has been shown that the State gives a very provoking one, when it says, "With this crown I shall employ workmen;"

for James B. (as soon as he sees it) will be sure to answer, "It is all very fine, but with this crown I might employ them myself."

Apart from this reason, others present themselves without disguise, by which the debate between the exchequer and poor James becomes much simplified. If the State says to him, "I take your crown to pay the gendarme, who saves you the trouble of providing for your own personal safety; for paving the street which you are pa.s.sing through every day; for paying the magistrate who causes your property and your liberty to be respected; to maintain the soldier who maintains our frontiers,"--James B., unless I am much mistaken, will pay for all this without hesitation. But if the State were to say to him, "I take this crown that I may give you a little prize in case you cultivate your field well; or that I may teach your son something that you have no wish that he should learn; or that the Minister may add another to his score of dishes at dinner; I take it to build a cottage in Algeria, in which case I must take another crown every year to keep an emigrant in it, and another hundred to maintain a soldier to guard this emigrant, and another crown to maintain a general to guard this soldier," &c., &c.,--I think I hear poor James exclaim, "This system of law is very much like a system of cheat!" The State foresees the objection, and what does it do?

It jumbles all things together, and brings forward just that provoking reason which ought to have nothing whatever to do with the question. It talks of the effect of this crown upon labour; it points to the cook and purveyor of the Minister; it shows an emigrant, a soldier, and a general, living upon the crown; it shows, in fact, _what is seen_, and if James B. has not learned to take into the account _what is not seen_, James B. will be duped. And this is why I want to do all I can to impress it upon his mind, by repeating it over and over again.

As the public expenses displace labour without increasing it, a second serious presumption presents itself against them. To displace labour is to displace labourers, and to disturb the natural laws which regulate the distribution of the population over the country. If 50,000,000 francs are allowed to remain in the possession of the tax-payers since the tax-payers are everywhere, they encourage labour in the 40,000 parishes in France. They act like a natural tie, which keeps every one upon his native soil; they distribute themselves amongst all imaginable labourers and trades. If the State, by drawing off these 60,000,000 francs from the citizens, acc.u.mulates them, and expends them on some given point, it attracts to this point a proportional quant.i.ty of displaced labour, a corresponding number of labourers, belonging to other parts; a fluctuating population, which is out of its place, and I venture to say dangerous when the fund is exhausted. Now here is the consequence (and this confirms all I have said): this feverish activity is, as it were, forced into a narrow s.p.a.ce; it attracts the attention of all; it is _what is seen_. The people applaud; they are astonished at the beauty and facility of the plan, and expect to have it continued and extended. _That which they do not see_ is, that an equal quant.i.ty of labour, which would probably be more valuable, has been paralyzed over the rest of France.

XI.--Frugality and Luxury.

It is not only in the public expenditure that _what is seen_ eclipses _what is not seen_. Setting aside what relates to political economy, this phenomenon leads to false reasoning. It causes nations to consider their moral and their material interests as contradictory to each other.

What can be more discouraging or more dismal?

For instance, there is not a father of a family who does not think it his duty to teach his children order, system, the habits of carefulness, of economy, and of moderation in spending money.

There is no religion which does not thunder against pomp and luxury.

This is as it should be; but, on the other hand, how frequently do we hear the following remarks:--

"To h.o.a.rd, is to drain the veins of the people."

"The luxury of the great is the comfort of the little."

"Prodigals ruin themselves, but they enrich the State."

"It is the superfluity of the rich which makes bread for the poor."

Here, certainly, is a striking contradiction between the moral and the social idea. How many eminent spirits, after having made the a.s.sertion, repose in peace. It is a thing I never could understand, for it seems to me that nothing can be more distressing than to discover two opposite tendencies in mankind. Why, it comes to degradation at each of the extremes: economy brings it to misery; prodigality plunges it into moral degradation. Happily, these vulgar maxims exhibit economy and luxury in a false light, taking account, as they do, of those immediate consequences _which are seen_, and not of the remote ones, _which are not seen_. Let us see if we can rectify this incomplete view of the case.

Mondor and his brother Aristus, after dividing the parental inheritance, have each an income of 50,000 francs. Mondor practises the fas.h.i.+onable philanthropy. He is what is called a squanderer of money. He renews his furniture several times a year; changes his equipages every month.

People talk of his ingenious contrivances to bring them sooner to an end: in short, he surpa.s.ses the fast livers of Balzac and Alexander Dumas.

Thus everybody is singing his praises. It is, "Tell us about Mondor!

Mondor for ever! He is the benefactor of the workman; a blessing to the people. It is true, he revels in dissipation; he splashes the pa.s.sers-by; his own dignity and that of human nature are lowered a little; but what of that? He does good with his fortune, if not with himself. He causes money to circulate; he always sends the tradespeople away satisfied. Is not money made round that it may roll?"

Aristus has adopted a very different plan of life. If he is not an egotist, he is, at any rate, an _individualist_, for he considers expense, seeks only moderate and reasonable enjoyments, thinks of his children's prospects, and, in fact, he _economises_.

And what do people say of him? "What is the good of a rich fellow like him? He is a skinflint. There is something imposing, perhaps, in the simplicity of his life; and he is humane, too, and benevolent, and generous, but he _calculates_. He does not spend his income; his house is neither brilliant nor bustling. What good does he do to the paper-hangers, the carriage makers, the horse dealers, and the confectioners?"

These opinions, which are fatal to morality, are founded upon what strikes the eye:--the expenditure of the prodigal; and another, which is out of sight, the equal and even superior expenditure of the economist.

But things have been so admirably arranged by the Divine inventor of social order, that in this, as in everything else, political economy and morality, far from clas.h.i.+ng, agree; and the wisdom of Aristus is not only more dignified, but still more _profitable_, than the folly of Mondor. And when I say profitable, I do not mean only profitable to Aristus, or even to society in general, but more profitable to the workmen themselves--to the trade of the time.

To prove it, it is only necessary to turn the mind's eye to those hidden consequences of human actions, which the bodily eye does not see.

Yes, the prodigality of Mondor has visible effects in every point of view. Everybody can see his landaus, his phaetons, his berlins, the delicate paintings on his ceilings, his rich carpets, the brilliant effects of his house. Every one knows that his horses run upon the turf.

The dinners which he gives at the Hotel de Paris attract the attention of the crowds on the Boulevards; and it is said, "That is a generous man; far from saving his income, he is very likely breaking into his capital." That is _what is seen_.

It is not so easy to see, with regard to the interest of workers, what becomes of the income of Aristus. If we were to trace it carefully, however, we should see that the whole of it, down to the last farthing, affords work to the labourers, as certainly as the fortune of Mondor.

Only there is this difference: the wanton extravagance of Mondor is doomed to be constantly decreasing, and to come to an end without fail; whilst the wise expenditure of Aristus will go on increasing from year to year. And if this is the case, then, most a.s.suredly, the public interest will be in unison with morality.

Aristus spends upon himself and his household 20,000 francs a year. If that is not sufficient to content him, he does not deserve to be called a wise man. He is touched by the miseries which oppress the poorer cla.s.ses; he thinks he is bound in conscience to afford them some relief, and therefore he devotes 10,000 francs to acts of benevolence. Amongst the merchants, the manufacturers, and the agriculturists, he has friends who are suffering under temporary difficulties; he makes himself acquainted with their situation, that he may a.s.sist them with prudence and efficiency, and to this work he devotes 10,000 francs more. Then he does not forget that he has daughters to portion, and sons for whose prospects it is his duty to provide, and therefore he considers it a duty to lay by and put out to interest 10,000 francs every year.

The following is a list of his expenses:--

1st, Personal expenses 20,000 fr.

2nd, Benevolent objects 10,000 3rd, Offices of friends.h.i.+p 10,000 4th, Saving 10,000

Let us examine each of these items, and we shall see that not a single farthing escapes the national labour.

1st. Personal expenses.--These, as far as workpeople and tradesmen are concerned, have precisely the same effect as an equal sum spent by Mondor. This is self-evident, therefore we shall say no more about it.