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CO M M E R OI AX
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C APIT Ali—DEBT—W AB . The science of political economy was brought into notice by .. . trade * and political economical questions have ever since been regarded as closely connected with it . The science is not , in fact , more exclusively connected with it than with any ptlier of the businesses by which we all live . In consequenee of the supposed connexion , however , we discuss in this place a question of economical science and of economical history which now requires elucidation .
Last week , in noticing in another part of our journal Mr . Capps ' s work on the National Debt , we pointed out that this was not a destruction , ^ but only a transfer of property , and that apprehensions of national ruin from the debt , which have been often entertained and often deceived , were occasioned by misunderstanding the true nature of the debt . The recipients of the annuities charged on the national industry are some of ourselves , and the distribution of this portion of its produce amongst them by the debt no more impoverishes the nation , as a whole , than the gift of tithes to the
Church , or rent to the landowner . The evils of war need no exaggeration , and if the 369 , 000 * 000 / . of debt incurred between 1801 and 1816 had been actually abstracted from the capital of the country over and above the heavy additional , amount of taxation annually levied , as was stated last week by a contemporary , instead of an increase of population in that period of about twenty-one per cent ., it must have been lessened from the loss of the means of employment and subsistence- Although the war increased the capital of the debt to the amount mentioned , every sixpence of which went of which
to remunerate the growers of timber warships were built , and of food by which they were provisioned $ the importers of hemp which supplied them with ropes and sails ; the iron-masters who procured metal for cannon and muskets— -in short ; every sixpence of it which went to remunerate any of the parties who supplied the munitions of Warfar from being abstracted from the capital of the country , Teplaced the capital of all these persons with a very considerable profit . On the whole , much the larger part of the sum borrowed was so employed . What the war actually destroyed—the amount of capital which it really abstracted from
the country—was the value of the industry it wasted In , killing foreigners , and in destroying their property , and the profit which would have accrued from that industry if not directed to a work of destruction . We could not do enormous mischief without inflicting on ourselves much injury , but not equal to the abstraction from the country of 369 , 000 , 000 / . of capital , or 23 , 000 , 000 ? . per annum ^ -nearly equal to the value of the wheat crop—for sixteen successive years . War , from its frequency , _ may be considered even now as a natural condition of the human species , and it should be satisfactory rather , than otherwise to find it less destructive of human
welfare than is commonly Tepresented . The error we'have pqinted out grows from the . erroneous notion * entertained of capital by political economists . ' 'They represent it as saving and as supplying the means 6 f employment for the people . At the same time , they admit that all capital , like all other Wealth ,-is annually either used ¦ or consumed And is annually reproduced , the repairs of implements and instruments of allJdnds i being tantamount to a continual , reproduction , 'We ; who live in : an age ; of marvels hare Earned Jthat new < itrventiooa which supersede u > 14 capital- ^ as railways hove , to ^ a considerable extent , superseded turnpxketroads
- —iand dfcatroy the 'value of saying , are the main sources 'of new employments for ' "the people and of'the-progress of sooiety . While tho railways were in course of construction , through a , series of years by- engineers , jiavvics ,. and their .-helps , , lall the classes of society . not .. engaged . in making , railways were employed in their usual avocations ot , growing corn , jnaVipg-cloth , , J > uUding . houses , &o . # c . j and clearly ^ heirail ^ ay . makers' wonts , were , not supplied tlwough . liUl 4 ^ el ' poriod by , . anything saved , but by the prodwfcivjb ^ bwu of , a& . those . other , classes , iJSapital . tfe . »* t < scafrUUwbe > o £ j > roper * y , . Jf' » » ! bank-note , 'ca r ight' | o wshwo » of' the * faational debt , » deposit 'jn , ''a l' 6 w » J «^ w » ndi w as 'merely the , means or tjfanSlNriner the portion of the anxiuar produce which / belong to . the . qapititfwt 1 by-mlmeofrthc Jaw
conferring it on him , to other persons , such as the railway-makers , and it was in no otherwise instrumental in the promotion of railways . Cap ita ^ therefore , is not the means of employing the people ; one species of industry employs and pays another ; and consequently the evil of a national debt or . the evil of war , limiting our view to its expense , is to be measured exclusively by the misdirection of industry . Many other employments misdirect it as much as war , ' in proportion they are equally destructive .
In pointing out Mr . Capps ' error , we referred to the condition of the people during the war between 1793 and . 1815 , and mentioned that it was much deteriorated . We find this view amply confirmed by the journal we have alluded to . The increase of population in England and Wales in the interval—partly of factory , workers reared from pauper children sent from the metropolis and agricultural districts into the manufacturing towns , or partly of Irish and their descendants who nocked into England , was unquestionably attended , as all who remember or have read of the period must be well
aware , by a great deterioration of the condition of the multitude . Accordingly , the Economist states that in the first fifteen years of the century the total quantities of articles imported had not increased , though the population had 21 per cent . ; that the consumption of tea had fallen oif two ounces per head ; and the consumption of sugar three pounds per head , and that of these articles , 80 per cent , is consumed by . the middle and lower classes . These are very decisive proofs of the deterioration of the working people of this part of the empire , for the middle classes made great advances in the first fifteen years of the century . made b
A statement , however , subsequently y our contemporary , shows how . much more mischievous can be other misdirections of industry even than the destructive employment of the soldier . It was not , he says , until about 1 S 32 that the state of exhaustion in which the war left the country Was overcome . At the end of sixteen years of peace , therefore , the country was in no better condition than at the close of war ; and those sixteen years , though the industry of the people never slackened , were riot more conducive to the welfare of the people than sixteen years of war . Speaking of the shipping , lie adds , it was not till 1834 that it had recovered what it had lost between 1815 and 1823 . In those eight years of
peace , therefore , the shipping interest went to decay , and in that period Mr . Wallace and Mr . Huskisson undertook their reforms of the commercial and navigation laws chiefly in order to relieve the shipping interest . Their exertions , however , were of little avail , and no political regulation sufficed to promote trade and restore continuous prosperity to the country till the necessities of the case compelled our most unwilling legislators first to reduce the tariff and ., afterwards to abolish the corn laws . The next turning point , however , was 1830 , when the distress and discontent of the people ,, after fourteen years of peace , drove the Tories from office and enabled the Whigs to pass the Reform Bill . .
The measures of Sir It . Peel arc referred to by our contemporary as having led , during tholast fifteen years , to extraordinary prosperity . Now , one of those measures , the greatest and best of them , was the abolition of the corn laws cnaofcoa m 1816 . It is well knovro that crimes augmented rapidly in England and Wales between low—the date of the first criminal returns—and 1815 . But it is also equaUy ^ / wellJtnown that- subsequent to 1815 , and especially between 1815 and 1819 , and down to so late a period as 1842 , crime continued to inorease . In peace , -after 1815 , poverty and crime made more rapid advances than xn war . Was this the consequence of peace , and of the prostration caused by the ^ ai ' P Certainly not . How could peace stop the increase of . our shipping and the extension
of our imports P What stopped both was the law passed in 181 tf , which Sir B . Pool supported for thirtyione years , and abolished in 1846 , At the former pewod England , in spite of . the extension of her agrioulturo , had become virtually dependent on foreign countries for a largo portion of . the food ol the people , The comlaUr
forbad the importation of food , and of course it equally forbad the exportation of manufactures to pay for it . It forbad , therefore , the employment of shipping , and it forbad the manufacture of clbtlu The corn law , therefore , was the plain and palpable cause of the sad condition of the country between 1815 and 1832 , which the Economist now refers to the exhaustion of war . The corn law was the cause of the people wanting employment , and of thepoverty and of the crime which increased after the
peace . The corn law ; was a misdirection of the industry of the nation , more mischievous even than war . Between 1816 and 1819 peace was continually made the scapegoat . for the consequences of the laws of our landowning Legislature . For society this is a great lesson , and therefore we now refer to it . We are all anxious to procure a reform of Parliaihent—let us take care that we make it a fair representation of industry , or this may be again misdirected by a law causing far greater calamities to the people than even pestilence or war .
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INSURANCE AGAINST WAR . The rumours and apprehension of war have beeii revived in the week . Large preparations arc making , large contracts for provisions are entered into , and in the face of these facts pacific assurances lose their force . Consols , instead of going up above par , the price in January , 1 S 53 , when the Bank minimum rate of discount was , as now , at 2 £ . per cent ., are depressed to 951 , and all other securities are proportionably low . The railway traffic shows a large increase as compared to last year . " Manchester , " said t he chairman of the is
Chamber of Commerce , on Wednesday , " as nourishing as ever I . recollect it . " The other places and other interests are nearly equally well oif , and yet the apprehensions of war paralyse enterprise and depress the value of all kinds of securities . Suppose—a moderate estimate—the amount of property affected be only 2 , 000 , 000 , 000 / ., a depreciation of " 2 per cent . —and probably the rumours of war cause a much greater depression po-wer- —will produce a depreciation in the whole to the extent of-40 , 000 , 000 / . Over the revenues ot every state in Europe the moneyed and mercantile classes hold a large mortgage , and when they see i 4-r \ miin titAii i hav tiieir ihm
j .. _ —~__ j- __ „ . _ :.-. « K ^ n /^ . > rnwrvM' . v . e the mortgagors inclined to ruin property , w they not a right , are they not bound , to try and restrain them ? At Lloyd's , extra premiums are exacted and readily paid for war risks . People are accustomed , therefore , to insure partially against the evils of war . Insurance against fire is general ; in grape-growing countries people insure against the destruction of hail-storms . Practically , people iusure alike against the visitations of Providence and against human negligence or malevolence . Why should they then not have on the same rule an insurance acainst war P Properly organised , it
might prevent war and save all the promiums actually paid at Lloyd ' s and other places , and the still heavier promiums paid , without ya the end obtaining security , in delayed enterprise , deteriorated property , and painful apprehensions . The great political principle of modern times theoretically recognised by all writers , andnractically acknowledged in overy representative ( tfoveriiment , and in every country where a representation is demanded , is the ascendancy or superiorityot tao whole people . Nowhere now in civilised Europe is a system of government theoretically JusUucci which has not nominally for its basis the welfare ot all the people Nowhere are the laws made exclusively for the beneUt of the . Church , the aristocracy , fclm tJTinv the hiireauoracv . or the army , but
professedly for the Whole people . In theory , then , as in fact—for all moral power depends ultimately on physical power—the . democracy is now the acknowledged master of society . In faot , it is anothor namo for society , The olassos now suffering from apprehensions of war arc oxtremoly influential , a » ° have it in their power , by their own oxortwn , to m * sure themselves against its evils . They may oven msure thomsclvos against it occurring . They have o tfy to unite in ditforent countries , or rather to pass Uio word to one another , declaring agauxst war wm » and ww taxes ( and it is useless lor them to complain of tho effects of these if they will not proved
Co M M E R Oi Ax
COM ME BO I A I ,.
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154 THE XBADER . [ Ko . 462 , jAyiTABY 29 , 1859 .
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Citation
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Leader (1850-1860), Jan. 29, 1859, page 154, in the Nineteenth-Century Serials Edition (2008; 2018) ncse2.kdl.kcl.ac.uk/periodicals/l/issues/vm2-ncseproduct2279/page/26/
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