CH. 23

NOTES ON MERCANTILISM, ETC.

363

employing an increasing population, must it not be acknow-ledged that such an attempt to accumulate, or that saving toomuch, may be really prejudicial to a country ? 1

The question is whether this stagnation of capital, andsubsequent stagnation in the demand for labour arising fromincreased production without an adequate proportion ofunproductive consumption on the part of the landlords andcapitalists, could take place without prejudice to the country,without occasioning a less degree both of happiness and wealththan would have occurred if the unproductive consumption ofthe landlords and capitalists had been so proportioned to thenatural surplus of the society as to have continued uninter-rupted the motives to production, and prevented first anunnatural demand for labour and then a necessary and suddendiminution of such demand. But if this be so, how can it besaid with truth that parsimony, though it may be prejudicialto the producers, cannot be prejudicial to the state; or that anincrease of unproductive consumption among landlords andcapitalists may not sometimes be the proper remedy for astate of things in which the motives to production fail? 2

Adam Smith has stated that capitals are increased byparsimony, that every frugal man is a public benefactor, andthat the increase of wealth depends upon the balance ofproduce above consumption. That these propositions aretrue to a great extent is perfectly unquestionable. . . . Butit is quite obvious that they are not true to an indefiniteextent, and that the principles of saving, pushed to excess,would destroy the motive to production. If every personwere satisfied with the simplest food, the poorest clothing,and the meanest houses, it is certain that no other sort offood, clothing, and lodging would be in existence. . . . Thetwo extremes are obvious; and it follows that there must besome intermediate point, though the resources of politicaleconomy may not be able to ascertain it, where, taking intoconsideration both the power to produce and the will toconsume, the encouragement to the increase of wealth is thegreatest . 3

Of all the opinions advancer! by able and ingenious men,which l have ever met with, the opinion of M. Say, which

1 A letter from Malthus to Ricardo, dated July 7, tSat.

• A letter from Malthas to Ricardo, dated July jSji,

9 Preface to Malthas'* Primipies %f P^Stkm Jsemtmy, pp. 8, 9,