BOOK duce of the land and labour of the country. It

II.

puts into motion an additional quantity of industry, which gives an additional value to the annual produce.

What is annually faved is as regularly confumed as what is annually spent, and nearly in the fame time too; but it is confumed by a different fet of people. That portion of his revenue which a rich man annually spends, is in most cafes, confumed by idle guests, and menial fervants, who leave nothing behind them in return for their confumption. That portion which he annually faves, as for the fake of the profit it is immediately employed as a capital, is confumed in the fame manner, and nearly in the fame time too, but by a different fet of people, by labourers, manufacturers, and artificers, who re-produce with a profit the value of their annual confumption. His revenue, we shall suppose, is paid him in money. Had he fpent the whole, the food, clothing, and lodging, which the whole could have purchased, would have been distributed among the former fet of people. By faving a part of it, as that part is for the fake of the profit immediately employed as a capital either by himself or by fome other perfon, the food, clothing, and lodging, which may be purchased with it, are neceffarily referved for the latter. The confumption is the fame, but the confumers are different.

By what a frugal man annually faves, he not only affords maintenance to an additional number of productive hands, for that or the enfuing

year,

year, but, like the founder of a public workhoufe, he establishes as it were a perpetual fund for the maintenance of an equal number in all times to come. The perpetual allotment and deftination of this fund, indeed, is not always guarded by any pofitive law, by any truft-right or deed of mortmain. It is always guarded, however, by a very powerful principle, the plain and evident interest of every individual to whom fhare of it fhall ever belong. No part of it can ever afterwards be employed to maintain any but productive hands, without an evident lofs to the person who thus perverts it from its proper deftination.

any

The prodigal perverts it in this manner. By not confining his expence within his income, he encroaches upon his capital. Like him who perverts the revenues of fome pious foundation to profane purposes, he pays the wages of idlenefs with those funds which the frugality of his forefathers had, as it were, confecrated to the maintenance of induftry. By diminishing the funds destined for the employment of productive labour, he neceffarily diminishes, fo far as it depends upon him, the quantity of that labour which adds a value to the fubject upon which it is bestowed, and confequently, the value of the annual produce of the land and labour of the whole country, the real wealth and revenue of its inhabitants. If the prodigality of fome was not compenfated by the frugality of others, the eonduct of every prodigal, by feeding the idle with the bread of the induftrious, tends not only

CHAP.

III.

BOOK to beggar himself, but to impoverish his coun

Though the expence of the prodigal fhould be altogether in home-made, and no part of it in foreign commodities, its effect upon the productive funds of the fociety would still be the fame. Every year, there would still be a certain quantity of food and clothing, which ought to have maintained productive, employed in maintaining unproductive hands. Every year, therefore, there would ftill be fome diminution in what would otherwise have been the value of the annual produce of the land and labour of the country.

This expence, it may be faid indeed, not being in foreign goods, and not occafioning any exportation of gold and filver, the fame quantity of money would remain in the country as before. But if the quantity of food and clothing, which were thus confumed by unproductive, had been diftributed among productive hands, they would have re-produced, together with a profit, the full value of their confumption. The fame quantity of money would in this cafe equally have remained in the country, and there would befides have been a reproduction of an equal value of confumable goods. There would have been two values instead of one.

The fame quantity of money, befides, cannot long remain in any country in which the value of the annual produce diminishes. The fole ufe of money is to circulate consumable goods. By means of it, provifions, materials, and finifhed

work,

III.

work, are bought and fold, and diftributed to CHAP. their proper confumers. The quantity of money, therefore, which can be annually employed in any country, must be determined by the value of the confumable goods annually circulated within it. Thefe muft confift either in the immediate produce of the land and labour of the country itself, or in something which had been purchased with fome part of that produce. Their value, therefore, muft diminish as the value of that produce diminishes, and along with it the quantity of money which can be employed in circulating them. But the money which by this annual diminution of produce is annually thrown out of domestic circulation, will not be allowed to lie idle. The intereft of whoever poffeffes it, requires that it should be employed. But having no employment at home, it will, in fpite of all laws and prohibitions, be sent abroad, and em ployed in purchafing confumable goods which may be of some ufe at home. Its annual exportation will in this manner continue for fome time to add fomething to the annual confumption of the country beyond the value of its own annual produce. What in the days of its profperity had been faved from that annual produce, and employed in purchafing gold and filver, will contribute for fome little time to support its confumption in adverfity. The exportation of gold and filver is, in this cafe, not the caufe, but the effect of its declenfion, and may even, for fome little time, alleviate the mifery of that declenfion.

VOL. III.

The

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The quantity of money, on the contrary, muft in every country naturally increafe as the value of the annual produce increases. The value of the confumable goods annually circulated within the fociety being greater, will require a greater quantity of money to circulate them. A part of the increafed produce, therefore, will naturally be employed in purchafing, wherever it is to be had, the additional quantity of gold and filver neceflary for circulating the reft. The increase of thofe metals will in this cafe be the effect, not the caufe, of the public profperity. Gold and filver are purchafed every where in the fame The food, clothing, and lodging, the revenue and maintenance of all thofe whofe labour or stock is employed in bringing them from the mine to the market, is the price paid for them in Peru as well as in England. The country which has this price to pay, will never be long without the quantity of those metals which it has occafion for; and no country will ever long retain a quantity which it has no occafion for.

manner.

Whatever, therefore, we may imagine the real wealth and revenue of a country to confift in, whether in the value of the annual produce of its land and labour, as plain reafon feems to dictate; or in the quantity of the precious metals which circulate within, it, as vulgar prejudices fuppofe; in either view of the matter, every prodigal appears to be a public enemy, and every frugal man a public benefactor.