thus accumulated are sometimes used for current expenses, in a national emergency; and thus the nation has been taxed beforehand to supply, perhaps, a wasteful ruler with means for profuse expenditure.

144. The book-keeping of nations and states is often complicated by different accounts and sinking funds. It ought to be plain and clear, so that every citizen could at a glance see the real state of the finances.

XIX.

OF PROPERTY.

145. Whatever you earn or produce or create by your labor or ingenuity or forethought, or all combined, is your property; it belongs to you, because you have taken the trouble to produce it; and you have the right to do with it what you will. You may, for instance, consume or waste it all.

146. If you produce more than you consume, what remains over is still your own, your property, to which you have the exclusive right against other persons. This surplus which remains over in your hands is called capital. Thus if you have saved enough from your product to buy yourself a spade, or a chest of tools, or a plow and span of horses, these articles are properly capital, and their possession constitutes you to that degree a capitalist. Ignorant persons misuse this word, and imagine a capitalist to be one who has accumulated some vague but large amount of property. I want you to understand that this is a foolish limitation of the meaning of this word.

147. Capital might be called the net profit of labor, if it were not that, in order to its existence, another element than labor is required, namely, self-denial or economy. For it is possible for a man to destroy, by consumption or waste, or both, all that he earns or produces; and a considerable part of mankind do actually live in this way-from hand to mouth, as we say.

148. Industry and economy united are therefore required, as you see, to accumulate that surplus which we call capital; and as both these are voluntary and irksome exercises: as you deny yourself both when you engage in productive labor and when you refrain from consuming or wasting what you have produced, it follows that no other person can have so good a claim on your surplus as yourself.

149. In a rude or savage society, a man who wished to accumulate property had not only to labor to create it, and to exercise self-denial to save it, but he had to devote a considerable part of his time and strength to defending his possessions as well as his life against others. To save this last necessity, society and governments exist, their use being to make life and property secure against attack; and by a general co-operation and contribution of efforts or of means to overawe and punish depredators. Armies, navies, the police, the courts, and the body of laws in obedience to which all these act in a free state, are simply means for the protection of life and property at a cheaper rate and in a more effective manner than could be done by individual efforts; and every nation is therefore, in this respect, only a great co-operative association, in which each member contributes somewhat from his accumulations or earnings to pay the charges for preserving the rest. It is only by thus delegating the power of protection to a few members of society that the remainder can get time to produce sufficient for consumption and a surplus-which surplus we call wealth or capital. And it is only where this protection is effective that men are encouraged to the labor and self-denial necessary to create property or wealth.

150. I want you to fix firmly in your mind that every dollar's worth of property or wealth in the world is a dollar's worth of proof that somebody at some time did not only labor to produce it, but denied himself some pleasure or comfort in order to save it. For though God gave us the soil, the seasons, rain, and many other means of production—just as he gave us our hands, strength, and brain-these are in themselves not wealth. The gold lay in California for cent

uries, and was useless and worthless until man's labor dug it out; and in like manner every natural product is worthless until the labor of man is applied to it. For instance, the plains of California might be covered with wheat; but, unless it was harvested, it would be worthless. You may say that cattle would eat it; but unless the cattle were afterwards caught and slain, and their hides and meat preserved by the labor of men, they would be worthless; and if, being caught, they were wastefully shot and left to rot, no surplus or capital would be saved.

151. Remember, too, that what we call the wealth of a nation is only the aggregate wealth of its members, and represents the results of their industry and self-denial. To increase this wealth, therefore, a people must both labor and save; and to be encouraged in these irksome duties, they must feel themselves secure in the enjoyment of what they produce and accumulate. Every thing, therefore, which makes property less secure, which exposes it not merely to open attack by predatory men, but to loss by bad laws, or by inefficient or corrupt rulers, weakens the spirit of accumulation.

152. But to maintain civilization, great accumulated wealth and an active desire by the people to accumulate more are absolutely necessary. If you will try to imagine a nation whose members have accumulated no property, you will see that to them civilization is impossible, even if they desired it. For such a people would have neither houses, cattle, nor toolsall of which are accumulated wealth or capital, to possess which men must previously have labored and denied themselves. But you must see that such a civilization as ours requires much more than houses, cattle, and tools. We have schools, shops, factories, roads, railroads, steamboats, telegraphs, and a great multitude of other things, to possess any one of which we must have accumulated, previous to their construction, property or wealth enough by our labor and selfdenial to pay their cost. A nation whose members had accumulated no property, and who consequently lived from hand to mouth, could not afford to build a railroad or a factory or

a school-house; each person would be busy providing food for himself; and no laboring force could be diverted to these other objects, because no means or capital would be at hand to support such a force while it was laying a stone wall or rolling a rail, which at the close of the day they could neither eat nor clothe themselves with.

153. Nor, if accumulation should at any time cease, could civilization continue; because in such a case the wealth already accumulated would quickly be spent, and the nation would be left without the means to maintain its instruments of civilization. If, for instance, the Californians had unanimously determined to dig out all the gold in their mountains, and confine themselves rigidly to that industry alone, or if California had been a sterile desert, yielding only gold, when the mines gave out they would have had to abandon the country, and leave it once more to become a desert. As production and accumulation ceased, civilization would have fled the state. But as the land is fertile and the settlers turned also to agriculture, they used natural resources which, unlike gold mines, never fail; and the accumulation of wealth went on when gold ceased to be abundant.

XX.

OF MONEY.

154. But to encourage production and facilitate accumulation, something besides security of property is required. Each man can not produce all the articles he needs for comfort and enjoyment, because many things which he desires can not be produced in the climate or on the soil where he lives. Moreover, he can work to much greater advantage, produce more easily, and accumulate more rapidly, if he confines himself to one or a few articles of production. If you are a carpenter and I a shoemaker, it would plainly be an advantage to both of us, I wanting a house, and you shoes for

your family, if we agreed that you would build me the house, and I should make you a certain number of shoes. This kind of exchange is called barter.

155. Imagine now a tribe or nation to whom barter is unknown, but who have learned to accumulate property. Each family aims to provide all it needs by its own labor; and whatever its surplus may be it stores away. You will see the monstrous inconvenience of such a condition, because the surplus may be perishable. But, what is far more serious, such a surplus could have no value; for unless it could be sold, which means exchanged for some other articles giving comfort or enjoyment, it would simply accumulate, and in time rot. That is to say, unless you can exchange your surplus for something else, it is absolutely worthless.

156. Fix clearly in your mind, therefore, that to establish industry and self-denial, which means to make civilization possible, it is necessary, first, that property shall be secure; and, second, that the possessors of property shall be able freely to exchange it for other articles which they desire; and that if you take away the possibility of exchange, produc- 、 tion will cease.

157. If you had hides and I coffee, you might, if you could find me, give me hides for my coffee; and thus both of us would be benefited and pleased. We should, however, first be at the trouble of finding each other, and would probably waste much time in this pursuit, which would be so much taken from the production of other hides and coffee. If now a third person should appear, ready to carry your hides to me, and bring back to you my coffee, plainly that would be an advantage to both of us, who could go on in the pursuits in which we had most skill, and in which therefore we could produce the most.

158. This third person is called a merchant, and his business is commerce. For his trouble we should both be ready to pay him a share of our products, because by using his labor and skill we are enabled to produce a greater quantity.

159. But how am I to be sure that the merchant to whom