Letters of David Ricardo to Thomas Robert Malthus, 1810-1823 Part 18

because capital is abundant compared with [labour][212], they cannot both, I think, be abundant at one [and the same time].

Admitting that you are correct on this [point, I doubt] whether the inference you draw is the correct one, and it [does not seem to me] wise to encourage unproductive consumption. If individuals would not do their duty in this respect, government might be justified in raising taxes for the mere purpose of expenditure.

McCulloch[213] has a short review of your book in the last Scotsman; it is chiefly on the subject of value; he differs from you but does so with the greatest civility and good humour. Torrens has an interest in (I believe he is editor of) the Traveller[214], and as his arguments are on my side, I of course think his criticism just....

Believe me, ever truly yours, DAVID RICARDO.

LXXII[215].

GATCOMB PARK, _Sept. 4, 1820_.

MY DEAR MALTHUS,

I was very desirous of hearing from you, and was on the point of telling you so when your letter reached me from Brighton. Mr. Hump[hre]y Austin, a neighbour of mine, told me he saw you at Paris and I had heard of your safe arrival in England. I am quite pleased to hear that your journey has been agreeable to you; it could not fail to be so when it gave you the opportunity of seeing and conversing with the princ.i.p.al literary men of France and of hearing their opinions on the present state of that important country. I hope in that quarter there will be no interruption of the present order of things for some time to come; but, if they do make a movement, I trust it will be for the purpose of securing more effectually the liberty of the people by perfecting as far as human means can perfect the representative system. There is nothing on which the happiness of the great body of the people so much depends. I did not expect that I had so many readers in France as the number of copies of the French translation which you tell me have been sold would seem to imply. I am not surprised that you found few who understood my theory correctly and still fewer who were disposed to agree with me. I have not yet succeeded in making many converts in my own country; but I do not despair of seeing the number increase; the few I have are of the proper description, and do not want zeal for the propagation of the true faith.

I have seen Say's letters to you[216]; it appears to me that he has said a great deal for the right cause but not all that could be said. In one point I think he falls into the same error as Torrens in his article in the Edinburgh Review[217]. They both appear to think that stagnation in commerce arises from a counter set of commodities not being produced without which the commodities on sale are to be purchased, and they seem to infer that the evil will not be removed till such other commodities are in the market. But surely the true remedy is in regulating future production; if there is a glut of one commodity, produce less of that and more of another, but do not let the glut continue till the purchaser chooses[218] to produce the commodity which is more wanted. I am not convinced by anything Say says of me; he does not understand me and is frequently at variance with himself, when value is the subject he treats of. In his 4th edition[219], vol. ii, page 36, he says everything falls in value, as the quant.i.ty is increased, by the facility of production.

Now suppose that you have to pay for what he calls 'services productifs'

in these commodities which have so fallen in value, will you give the same value if you give for them the same quant.i.ty of commodities as before? Certainly not, according to his own admission; and yet he maintains, page 33, that productive services have not varied if they receive the same quant.i.ty of a commodity, notwithstanding the cost of production of that commodity may have fallen from 40 to 30 francs per ell. He has two opposite notions about value, and I am sure to be wrong if I differ with either of them[220].

I am sorry that the government of France is prejudiced against Political Economy. Whatever differences of opinion may exist amongst writers on that science, they are nevertheless agreed upon many important principles, which are proved to demonstration. By an adherence to these, governments cannot fail to promote the welfare of the people who are submitted to their sway. What more clear than the advantages which follow from freedom of trade, or than the evils resulting from holding out any peculiar encouragement to population?

I have been reading your book a second time with great attention, but my difference with you remains as firmly rooted as ever. Some of the objections you make to me are merely verbal; no principle is involved in them; the great and leading point in which I think you fundamentally wrong is that which Say has attacked in his letters. On this I feel no sort of doubt. With respect to the word value, you have defined it one way, I another. We do not appear to mean the same thing, and we should first agree what a standard ought to be and then examine which approaches nearest to an invariable standard, the one you propose, or that which I propose.

I have not heard of anything further having been written against you either by McCulloch or Torrens, nor do I know that they have anything in contemplation. McCulloch has written me two letters since I saw you last; he does not say anything about value, and it will probably be a year or two before he can publish anything on that subject in the Supplement to the Encyclopedia. In the next Review there will be an article of his on t.i.thes, which I have seen; his principles are right, but I do not like his remedy for the existing evil[221].

Mill has been with me here for a fortnight and will stay some time longer. He has it in contemplation to write a popular work on Political Economy[222], in which he will explain the principles which he thinks correct in the most familiar way for the use of learners. It is not his intention to notice any person's opinions or to enter into a controversy on the disputed points.

I have been looking over my first chapter with a view to make a few alterations in it before the work goes to another edition. I find my task very difficult, but I hope I shall make my opinions more clear and intelligible. I did intend to defend myself against some of your attacks, but on reflection I think that, to do myself justice, I must say so much that I should very inconveniently enlarge the size of my book, besides which I should be constantly drawing my readers' attention from the [proper?] subject. If I defend myself at all, I must do it in [a] separate publication[223].

Respecting the trial of the Queen I am more than ever convinced of the impolicy and inexpediency of the proceedings which have led to it, and am quite sure that the plea set up that it is a State question is a false one: it is entered into merely to gratify the resentment and hostility of one individual who has himself behaved so ill that whatever he may have to complain of he so fully merits that no one is bound to enter into his quarrels or wish for punishment to follow offences to which his own conduct has been so instrumental.... Gatcomb is very delightful. I wish you and Mrs. Malthus could give us your company here before we go to London. Mr. Mill desires to be kindly remembered.

Ever yours, DAVID RICARDO.

LXXIII[224].

GATCOMB PARK, _10 Oct., 1820_.

MY DEAR MALTHUS,

The Queen's defence appears to be going on well; a few more such evidence [_sic_] as Sir Wm. Gell and I think the Lords cannot pa.s.s the bill; in that case I shall not be called to town, and if you are in this part of the world at Christmas perhaps we shall see you at Gatcomb.

Warburton is staying at Easton Grey and has paid us a visit of two or three days with the Smiths; he was very agreeable. He does not speak quite positively, but I think he is one of my disciples and agrees with me on some of those points which you most strongly dispute.

I quite agree with you in thinking that M. Say's letters to you are not very well done. He does not even defend his own doctrine with peculiar ability, and on some other of the intricate questions, on which he touches, he appears to me to be very unsatisfactory. He certainly has not a correct notion of what is meant by value when he contends that a commodity is valuable in proportion to its utility. This would be true if buyers only regulated the value of commodities; then indeed we might expect that all men would be willing to give a price for things in proportion to the estimation in which they held them; but the fact appears to me to be that the buyers have the least in the world to do in regulating price; it is all done by the compet.i.tion of the sellers, and, however the buyers might be really willing to give more for iron than for gold, they could not, because the supply would be regulated by the cost of production, and therefore gold would inevitably be in the proportion which it now is to iron, although it probably is by all mankind considered as the less useful metal.

I think more may be said in defence of his doctrine of services; they are, I think, the regulators of value, and, if he would give up rent, he and I should not differ very materially on that subject. In what he says of services he is quite inconsistent with his other doctrine about utility. He appears to me to talk very ignorantly of the taxation of England. In the note, page 101, he concedes too much. The difficulty of finding employment for capital in the countries you mention proceeds from the prejudices and obstinacy with which men persevere in their old employments; they expect daily a change for the better, and therefore continue to produce commodities for which there is no adequate demand.

With abundance of capital and a low price of labour there cannot fail to be some employments which would yield good profits; and, if a superior genius had the arrangement of the capital of the country under his control[225], he might, in a very little time, make trade as active as ever. Men err in their production; there is no deficiency of demand. If I wanted cloth and you cotton goods, it would be great folly in us both, with a view to an exchange between us, for one of us to produce velvets and the other wine; we are guilty of some such folly now, and I can scarcely account for the length of time that this delusion continues.

After all, the mischief may not be so great as it appears. You have fairly represented the point at issue between us;--I cannot conceive it possible, without the grossest miscalculation, that there should be a redundancy of capital and of labour at the same time.

When I say mine is the true faith, I mean to express only my strong conviction that I am right; I hope you do not attach anything like arrogance to the expression. I am in the habit of a.s.serting my opinion strongly to you, and I am sure you would not wish me to do otherwise. I am satisfied that you should do the same by yours, and I dare say you will agree with me that you are not more inclined to yield to mere authority without being convinced than I am[226]. I affirm with you that 'if the farmer has no adequate market for his produce, he will soon cease to distribute more necessaries to his labourers,' with a view to the production of more necessaries; but will he therefore leave that part of his capital inactive, will not he or somebody else employ it in producing something which will meet an adequate market? You speak of the relative _utility_ of our two definitions of value. I confess that your definition[227] does not convey to my mind anything approximating to the idea I have ever formed of value. To say that real value as applied to wages implies the quant.i.ty of necessaries given to the labourer, at the same time that you agree that those necessaries are as variable as anything else, appears to me a contradiction. Political Economy you think is an enquiry into the nature and causes of wealth; I think it should rather be called an enquiry into the laws which determine the division of the produce of industry amongst the cla.s.ses who concur in its formation. No law can be laid down respecting quant.i.ty, but a tolerably correct one can be laid down respecting proportions. Every day I am more satisfied that the former enquiry is vain and delusive, and the latter only the true object of the science. You say that my proposition, 'that with few exceptions the quant.i.ty of labour employed on commodities determines the rate at which they will exchange for each other, is not well founded.' I acknowledge that it is not rigidly true, but I say that it is the nearest approximation to truth, as a rule for measuring relative value, of any I have ever heard. You say demand and supply regulates value [_sic_]; this I think is saying nothing, and for the reason I have given in the beginning of this letter: it is supply which regulates value[228], and supply is itself controlled by comparative cost of production. Cost of production, in money, means the value of labour as well as profits. Now, if my commodity be of equal value with yours, its cost of production must be the same. But cost of production is, with some deviations, in proportion to labour employed.

My commodity and your commodity are both worth 1000; they will therefore probably have the same quant.i.ty of labour realized in each.

But the doctrine is less liable to objections when employed not to measure the whole absolute value of the commodities compared, but the variations which from time to time take place in relative value. To what causes, I mean permanent causes, can these variations be attributed? To two and to two only, one insignificant in its effects, a rise or fall of wages, or what I think the same thing a fall or rise of profits, the other of immense importance, the greater or less quant.i.ty of labour that may be required to produce the commodities. From the first cause no great effects may follow because profits themselves const.i.tute but a small portion of price, and no great addition or deduction can be made on their account. To the other cause no very confined limit can be a.s.signed, for the quant.i.ty of labour required to produce commodities may vary to double or treble.

The subject is difficult, and I am but a poor master of language, and therefore I shall fail to express what I mean. My first chapter[229]

will not be materially altered; in principle I think it will not be altered at all....

Ever truly yours, DAVID RICARDO.

LXXIV[230].

GATCOMB PARK, _24 Nov., 1820_.

MY DEAR MALTHUS,

I have been living in a state of great uncertainty whether I should be obliged to go to London or not. It seems to be settled that Parliament will be prorogued, and therefore I do not think it necessary to take a journey to town for the sole purpose of hearing the usher of the black rods give his three taps at the door of the House of Commons with his rod of office, and which [_sic_] we are a.s.sured by Hobhouse would be laid about his back, if he presumed so to disturb a reformed House of Commons. The political horizon does not appear to be clearing up. It is always unwise for a Government to set itself against the declared opinion of a very large cla.s.s of the people, and it is more particularly so when the point in dispute is one trifling in itself, and of no real importance to the state. Should the public be kept in this agitated state on a question whether the Queen should be allowed a palace, or whether her name should be inserted in the Liturgy? Nothing can be more unjustifiable than to risk the public safety on such questions as these, for after raising the discussion there is no safety either in yielding or resisting.

You say in your last letter 'that you are fortified with new arguments to prove demonstratively that a neat revenue is absolutely impossible under the determination to employ the whole produce in the production of necessaries, and consequently that if there is not an adequate taste for luxuries and conveniences or unproductive labour, there must necessarily be a general glut.' I shall not trouble you to bring forward these arguments, for with a very slight alteration I should entirely concur in your proposition. If I recollect right, it is the very exception which I made[231] and which you mention in your book. You must collect your stock of arguments to defend more difficult points than this.

I am quite sure that you are the last man who would misstate an adversary, knowingly, yet I find in your book some allusions to opinions which you represent as mine and which I do not really hold. In one or two cases you, I think, furnish the proof that you have misapprehended me, for you represent my doctrines one way in one place, and another way in another. After all the difference between us does not depend on these points; they are very secondary considerations.

I have made notes on every pa.s.sage in your book which I dispute, and have supposed myself about publishing a new edition of your work, and at liberty to mark the pa.s.sage with a reference to a note at the bottom of the page. I have in fact quoted three or four words of a sentence, noting the page, and then added my comment. The part of your book to which I most object is the last. I can see no soundness in the reasons you give for the usefulness of demand on the part of unproductive consumers. How their consuming, without reproducing, can be beneficial to a country, in any possible state of it, I confess I cannot discover.

I have also written some notes on M. Say's letters to you, with which I am by no means pleased. He is very unjust to me, and evidently does not understand my doctrine; and for the opinions which we hold in common he does not give such satisfactory reasons as might, I think, be advanced.

In fact he yields points to you, which may almost be considered as giving up the question, and affording you a triumph. In Say's works generally, there is a great mixture of profound thinking, and of egregious blundering. What can induce him to persevere in representing utility and value as the same thing? Can he really believe that our taxation operates as he describes[232], and can he think that we should be relieved, in the way he represents, by the payment of our national debt[233]?

I shall not dispute another proposition in your letter. 'No wealth,' you say, 'can exist unless the demand or the estimation in which the commodity is held exceeds the cost of production.' I have never disputed this. I do not dispute either the influence of demand on the price of corn or on the price of all other things; but supply follows close at its heels and soon takes the power of regulating price in his [_sic_]

own hands, and in regulating it he is determined by cost of production.

I acknowledge the intervals on which you so exclusively dwell, but still they are only intervals. 'Fifty oak trees valued at 20 each do not contain as much labour as a stone wall in Gloucestershire which costs 1000['][234]. I have answered your question; let me ask you one. Did you ever believe that I thought fifty oak trees would cost as much labour as the stone wall? I really do not want such propositions to be granted in order to support my system....

I am, Ever truly yours, DAVID RICARDO.

LXXV[235].

[MINCHINHAMPTON, _29 Nov., 1820_.]

MY DEAR MALTHUS,

... I am very glad to hear of your intention of paying me a visit here.