Subject of Poor Laws, continued.

observed in general that when a fund for the maintenance of labor is raised by assessment, the greatest part of it is not a new capital brought into trade, but an old one, which before was much more profitably employed, turned into a new channel. The farmer pays to the poor's rates for the encouragement of a bad and unprofitable manufacture, what he would have employed on his land with infinitely more advantage to his country. In the one case, the funds for the maintenance of labor are daily diminished; in the other, daily increased. And this obvious tendency of assessments for the employment of the poor, to decrease the real funds for the maintenance of labor in any country, aggravates the absurdity of supposing that it is in the power of a government to find employment for all its subjects, however fast they may increase.

It is not intended that these reasonings should be applied against every mode of employing the poor on a limited scale, and with such restrictions as may not encourage at the same time their increase. I would never wish to push general principles too far, though I think that they ought always to be kept in view. In particular cases, the individual good to be obtained may be so great,

Subject of Poor Laws, continued.

and the general evil so slight, that the former may clearly overbalance the latter.

The intention is merely to show, that the poor laws as a general system are founded on a gross error; and that the common declamation on the subject of the poor, which we see so often in print, and hear continually in conversation, namely, that the market price of labor ought always to be suffieient decently to support a family, and that employment ought to be found for all those who are willing to work is in effect to say, that the funds for the maintenance of labor in this country are not only infinite, but might be made to increase with such rapidity, that supposing us to have at present six millions of laborers, including their families, we might have 96 millions in another century; or if these funds had been properly mana ged since the beginning of the reign of Edward I. supposing that there were then only two millions of laborers, we might now have possessed above four million millions of laborers, or about four thousand times as many laborers as it has been calculated that there are people now on the face of the earth.

CHAPTER VII.

Of increasing Wealth as it affects the Condition

of the Poor.

THE professed object of Dr. Smith's inquiry is, the nature and causes of the wealth of nations. There is another however perhaps still more interesting, which he occasionally mixes with it, the causes that affect the happiness and comfort of the lower orders of society, which in every nation form the most numerous class. I am sufficiently aware of the near connexion of these two subjects, and that generally speaking, the causes which contribute to increase the wealth of a state tend also to increase the happiness of the lower classes of the people. But perhaps Dr. Smith has considered these two inquiries, as still more nearly connected than they really are; at least he has not stopped to take notice of those instances, where the wealth of a society may increase according to his definition of wealth, without having a proportional tendency to increase the comforts of the laboring part of it.

Of increasing wealth as it affects, &c.

I do not mean to enter into any philosophical discussion of what constitutes the proper happiness of man, but shall merely consider two universally acknowledged ingredients, the command of the necessaries and comforts of life, and the possession of health.

The comforts of the laboring poor must necessarily depend upon the funds destined for the maintenance of labor; and will generally be in proportion to the rapidity of their increase. The demand for labor, which such increase occasions, will of course raise the value of labor; and till the additional number of hands required are reared, the increased funds will be distributed to the same number of persons as before, and therefore every laborer will live comparatively at his ease. The error of Dr. Smith lies in representing every crease of the revenue or stock of a society, as a proportional increase of these funds. Such surplus stock or revenue will indeed always be considered by the individual possessing it, as an additional fund from which he may maintain more labor; but with regard to the whole country, it will not be an effectual fund for the maintenance of an additional number of laborers, unless part of it be convertible into an additional quantity of provisions; and it

in

Of increaing wealth as it affects

will not be so convertible where the increase has arisen merely from the produce of labor, and not from produce of the land. A distinction may in this case occur between the number of hands which the stock of the society could employ and the number which its territory can maintain.

Dr. Smith defines the wealth of a state to be the annual produce of its land and labor. This definition evidently includes manufactured produce as well as the produce of the island. Now supposing a nation for a course of years to add what it saved from its yearly revenue to its manufacturing capital solely, and not to its capital employed upon land, it is evident that it might grow richer according to the above definition, without a power of supporting a greater number of laborers, and therefore without any increase in the real funds for the maintenance of labor. There would notwithstanding be a demand for labor, from the extension of manufacturing capital. This demand would of course raise the price of labor; but if the yearly stock of provisions in the country were not increasing, this rise would soon turn out to be merely nominal, as the price of provisions must necessarily rise with it. The demand for manufacturing laborers would probably entice some