dance, must at once be divested of value, or of the possibility of constituting any part of individual riches."*

I shall not follow the noble Earl in the very extensive developements which he has given to his opinion; they would add nothing either to the distinctness or demonstration of his thoughts, and would not render the question, which he has started, either more difficult or more important, as the most simple reflection is sufficient to resolve it.

The produce of general labour, whether in the hands of individuals, where it forms private income, or diffused all over the country in the shape of national income, is partly consumed by the producers, and partly exchanged, with the view of the objects obtained in exchange being consumed either by the producers or other classes of consumers.

If the produce consumed in the place of its production be abundant, its plenty contributes alike to public and private wealth, and establishes no difference between those two sorts of wealth.

If, on the contrary, that produce be rare, its scarcity impoverishes alike the individual and the public, and public and private wealth is equally a sufferer.

With regard to the produce exchanged by the producers, if the exchange takes place with a foreign country, its abundance turns to the benefit of the foreigners, who purchase it with the same values which they used to give for it, unless the foreign

An Inquiry into the Nature and Origin of Public Wealth, and into the Means and Causes of its Increase, by the Earl of Lauderdale, chap. ii. pages 43, 45, 48.

country should have been favoured with a like abundance in its own produce; because, in that case, plenty is equally beneficial to the foreigners and the natives, and in both cases private and public wealth remains the same.

If, on the contrary, the produce exchanged with the foreign country is scarce, the foreigners are sufferers by this scarcity. They give the same quanity of produce in return as in the times of plenty, because their produce could not find any other employment; and if the harvest has been as bad abroad as at home, then the two countries suffer alike by this common scarcity; and in both cases public and private wealth either continues in the same situation or undergoes the same alteration.

Finally, if the exchange of national produce take place at home, its plenty becomes beneficial to, the consumers without any loss to the producers, because the latter always receive the same value which they usually received from the consumers. But, in a case of scarcity, the loss is to the consumer, yet without any benefit to the producer, because the consumer can only give him the usual value; consequently, there is, in both cases, neither loss nor profit for private and public wealth.

It must, however, be acknowledged, that when either abundance or scarcity is excessive and extraordinary, it is more or less fatal to the producer or to the consumer; but in no instance does such an event produce any difference between public and private wealth. If, in the case of excessive plenty, the wealth of the producer be diminished, that of the

consumer is augmented; the one gains what the other loses; and public wealth, which consists of individual riches, experiences no change from the loss of the producers and the gain of the consumers. The case is the same when the latter are losers, and the producers gainers; the loss and the gain, with respect to general wealth, is compensated, and the situation is the same as if there had been neither loss nor gain in all private exchanges.

If, therefore, we regard merely the merit of the difficulty started by lord Lauderdale, I have perhaps, assigned too much importance to the solution of the difficulty but if it be viewed in all its consequences, it will be seen that it was my duty to neglect no means to prevent the noble Earl's opinion gaining any credit. Though the identity of public and private wealth be undoubted, and the danger of drying up the source of the former by bearing too hard upon the latter be imminent, yet private wealth has not always met with the regard to which it is entitled ; what, then, would be the consequence, if any, even the smallest doubt, were ever entertained concerning that identity; if a source could be assigned to public wealth, different from that of private riches; and if governments should persuade themselves that the decay of public wealth is no-wise injurious to private riches, or that private riches may be impaired without injuring national wealth? Apprehensions of this kind can never be realized, when governments are fully convinced of the identity of public and private wealth; and there is something extremely consolatory and beneficial in this opinion, which must not be

suffered to be shaken, and must be vigorously defended, because it is on this truth that the maintenance of social order, the progress of public wealth, and the amelioration of the condition of mankind, are, in some degree, depending.

The produce of annual labour, whether it be viewed as private or national income, is distributed in the shape of wages of labour, profit of stock, or rent of land.

The French economists were well aware that this distribution ought to take place according to regular and general laws; but instead of seeking for these laws, they created them conformably to the system which they had adopted.*

Adam Smith was better informed, or more fortunate. He discovered these laws in the very nature of things.

He states that the distribution of the national income is naturally regulated by the progressive, stationary, or retrograde state of national wealth. When wealth is progressive, more produce of the annual labour is distributed in wages of labour, profit of stock, and rent of land. When wealth is stationary, a smaller quantity of that produce goes to the labourers as wages, and to the land-holders as rent ; and the profit of stock remains as before. When wealth is retrograde, the wages of labour sink so low that they are scarcely adequate to supply the most urgent wants of the labourers; rents also suffer a considerable diminution; but the profits of stock expe

* Physiocratie; Tableau Economique.

rience, on the contrary, a rise corresponding with the decline of national wealth. Not to be struck with the justness and truth of these laws, and to withhold a tribute of praise and admiration from the mind that discovered them, is equally impossible.

To these general and fundamental rules of the distribution of the produce of annual labour, Adamn Smith has added some particular ones for the wages of different labours, the profit of different capitals, and the rents of every different kind of soil.

I have already explained his doctrine concerning the wages of different labours, (book ii. chap. 7,) and the profit of different capitals, (book iii, chap. 5.) I shall therefore confine myself to a few observations on that part of his doctrine which relates to the rents of land, of which I have not hitherto had an opportunity to speak.

The writers on political economy are not agreed upon the causes which establish the rent of lands.

The French economists derive it from the original advances of the land-owner in clearing the land and putting it into a state of cultivation.

Adam Smith has combated this opinion with arguments drawn from the circumstance that land-owners demand a rent even for unimproved land; that those improvements are sometimes made by the stock of the tenant; and that land-owners sometimes demand rent for what is altogether incapable of human improvement.

He therefore regards the rent of land, considered as the price paid for the use of the laud, as a monopoly-price, which is always determined by what