20
Manual of Political Economy.
The case suggested is this. Suppose the farmers resolved to sell half their wheat, and spend the money upon their own enjoyments; the money for which one half the wheat is exchanged would be thus employed unproductively. Ought this wheat to be regarded as capital? Yes—is the answer which will very probably be given. It is true that the money for which the wheat is sold is employed unproductively, but this will not in any degree prevent the wheat being devoted to useful purposes. The wheat will still be made into bread, and will be consumed in just the same manner as it would have been if the farmers devoted the money for which it was sold to productive purposes, instead of spending it on their own enjoyments. That portion which is exchanged for luxuries is not capital.But suppose the farmers had devoted this money for which the wheat was sold to productive purposes; by just that amount would the capital of the country be increased. The money for which the wheat is sold is not itself consumed; this money is devoted to purchase commodities, and if they are consumed unproductively, an amount of wealth equal in value to the quantity of wheat first exchanged is consumed unproductively, instead of being devoted to increase the capital of the country, and thus assist the future production of wealth. Now our argument implies that when unproductive consumption is spoken of, a tacit assumption is made that the money for which the wheat has been sold is employed, in great part, to purchase luxuries. But luxuries, it may be said, naturally imply waste, and are not devoted to assist the production of wealth. Hence, all that portion of the wealth of a country which consists of luxuries can never be productively employed, and, therefore, can never be made to form a part of a nation's capital. It may, therefore, be asked. Can a farmer be said to diminish the capital of a country, if he does not waste his wheat, but simply sells it to others who will take good care to use it properly? It may further be urged that he does not reduce the capital of the country by buying luxuries; for luxuries cannot be used as capital, and if they were not consumed unproductively by him they would be so by some other person. It might, therefore, appear that wealth is diverted from forming a part of the capital of
