30 Manual of Political Economy.
BOOK I. CH. IV.
Practical application of these principles.
Effects of war.
wealth, and therefore capital is maintained by perpetual reproduction, and not by hoarding and keeping wealth out of consumption.
The leading propositions with regard to capital have now been discussed, and they afford principles which will enable us to investigate economic problems of the greatest interest and importance. An endless variety of such problems bearing upon the subject of capital may be readily suggested, and the student should zealously apply himself to their solution. Let him not suppose that he is wasting time upon the mere rudiments of the science; he may rest assured that, if he fully comprehends the subject of capital, his future successful progress in the science is assured, and that he will become one of those who can apply the principles of political economy to those financial and social questions which are the topics of everyday discussion.
It will be, perhaps, useful to our readers if we give one or two practical applications of the laws of capital which have been enunciated in this chapter. One such application is suggested by considering the rapidity with which a country recovers from the ravages of a disastrous war. This phenomenon was first fully elucidated by Dr. Chalmers. A conqueror overruns a country, and destroys every vestige of accumulated wealth which he can discover. A great portion of the food with which the labourers were to be fed is gone; machinery and other appliances with which industry is assisted are destroyed. The capital of the country appears to be almost lost, and when it is remembered that the future production of wealth depended upon this capital, it might be supposed that production would cease, and that the country must for years remain the same desolate waste. But, on the contrary, countries which have been thus ravaged and pillaged, have in a few years revived, and seemed to be as prosperous as before. The history of Athens, and the French Wars in the Palatinate, afford many striking examples of a rapid recovery from the devastation of war. The remarkable rapidity with which France recovered her commercial and financial prosperity after the conclusion of the war with Germany in 1870-71 is another example in point. Within four years of the