TWO BOOKS ON POLITICAL ECONOMY.* WEALTH, after all, is but
a means to happiness, and it is not, perhaps, on the whole to be regretted that the science of Economics—a term which seems preferable to the somewhat misleading one, Political Economy—should come to be regarded as mainly a branch or division of social science. At all events, thus dealt with, the science commands an interest that, treated from the standpoint of the older and stricter economists, it cannot, in these days, hope to evoke. Nevertheless, it is well to be brought back occasionally from the more at- tractive regions of social speculation to the severer domain of the followers of Smith and Ricardo. Of these founders of modern economics Jevons was the intellectual heir, combining the penetrative sagacity of the former with the faculty of lucid exposition possessed by the latter. These qualities are amply displayed in the volume of essays before us, which fully exhibit, besides, the Professor's peculiar power of happy illustration, the singular mathematico-literary skill with which he treated economical questions. They deal with the nature of the means of facilitating the exchange of wealth, rather than with wealth itself, in the more ordinary sense of the term; but money, in virtue of the important functions it discharges, is as real an element of wealth as roads or machinery. Gold, for to the noblest metal money is ulti- mately reduced, though the common measure of value, itself fluctuates in value ; and it is with an inquiry into the meaning of this variability that the major part of the book is con- cerned. Mr. Jevons well shows—he had shown it previously— that the value of money in the market, the Mint-price of gold, and the exchange-value of gold are not in the least connected with each other. The proposition is, perhaps, a somewhat broad one, and needs qualification, but in the main it is an accurate expression of the fact. He investigates at considerable length, and with a full appreciation of the difficulties that beset the inquiry, the variations in the relation between gold and com- modities of all kinds represented by prices, together with the causes and effects of these variations ; and the clearer compre- hension of the subject is greatly aided by the numerous and
* Investign'ions in Currency and Finance. By W. S. Jevons. With Diagrams. Edited by H. S. Po:well. M.A. London Mnomillan.—Property and Progress: a Brief Inquiry into Contemporary Social Agitation in England. By W. H. Malicia. London : J. Murray.
carefully-constructed diagrams that accompany the work. It is a pity, we may say parenthetically, that statists do not agree about some common standard or model of diagrams, and that these are not printed upon translucent paper, so that they might be overlaid and the nature of the mean of many curves observed at a glance. But the explanation of this variability hardly seems to be sought in the right quarter. Under a more searching analysis it would, we suspect, be found to involve other than purely economical considerations, and to turn largely, if not chiefly, upon the state at a given moment of the slowly but con- tinuously advancing mean standard of comfort and culture which tends to compel men to approach the limit of exhaustion of the world's resources. Hence, prices on the whole tend to rise, and the value of gold measured in commodities to fall, a tendency only partially met by invention and discovery. Mr. Jevons thought that the fall might be ultimately arrested at 30 per cent. under the value obtaining just before the Californian gold discoveries, and states in his second essay that "the utmost depreciation of gold which can be considered likely will be just about sufficient to restore gold and silver to the proportional values which they usually held in the middle and older historical ages of the world." We are inclined to agree with this view; gold discovery is not likely to outmarch the need of gold, hut rather to fall behind it, and the cost of mining, which is chiefly that of mechanical and not of chemical manipulation, tends to increase rather than diminish. The fall, we are further assured, in opposition to the very uncomfortable prophecies of Cobden. and Chevalier, will be so gentle that society will have ample time for adaptation. This, perhaps, is true, so far as regards the bulk of society ; but a not inconsiderable section of it, com- prising functionaries, pensioners, fundholders, &c., cannot but be seriously incommoded by any other than an almost imper- ceptible and very slow fall.
The chapter on the coinage will be read with great interest at the present juncture. It is impossible to give even an idea of its contents within the limits at our disposal. Appended to it is Mr. Jevons's view of what he considered a perfect currency. He advocated for home use a paper system with a basis of gold, and an international metal currency, of which the five or ten franc piece should form the unit of account—the gold coins being of ten and twenty-five francs respectively. It is evident, however, that one coin would amply suffice, and the larger one would, of course, be the most economical. Coins of the latter category would suffer little wear, for they would be chiefly used, as are the Japanese gold $20 pieces, as a guarantee or basis of paper. We agree with the suggestion that fractional notes might be safely issued, and as representing small change, they might be made legal tender up to forty shillings only, and made payable in silver. Paper is often preferred to coin ; in Japan some years back the Kineateu were at a premium. On the question of Bimetallism Mr. Jevons's deliverances are far from definite. We are a little astonished at this ; we should have thought Bimetallism, as put forward by the Bimetallists, theory wholly repulsive to his clear, logical, informed, and positive mind. Mr. Foxwell, with the valuable aid of Mrs. Jevons, has done his part as editor exceedingly well, and the volume is one no economist or politician can afford to refuse a place on his shelves.
Turning to Mr. Mallock's book, we find ourselves in an atmo- sphere charged with thunderous influences, and dark with the foreshadowings of the difficulties the twentieth century must encounter and resolve. The most momentous of these impending problems is undoubtedly the satisfactory adjustment of the rela- tions between capital and labour, and neither the methods nor the principles are yet settled upon which the " gling " of this, the most important of all markets, ought to be conducted. It is clear, however, that some form of co-operation, modified, perhaps, by a more or less social- istic regulation of competition, is the most likely outcome of the present ferment in men's minds upon the subject. A. writer in the current number of the North American Review says appositely,—" It may be that the coming age of combination will issue in a nobler and fuller liberty for the individual than has yet been seen, but that consummation will be possible not in a day of competitive trade [unrestrictedly competitive is probably the intended meaning], but in one of competitive morals." It is an evil of no small moment that such altogether false conceptions as those of Mr. George should be presented with a literary skill that. enables them to command an attention and exercise an influence—though, assuredly, a transient one-- they do not in the least merit. Mr. George is a rhetorical, not a scientific economist; and Mr. Mallock meets him occasionally rather with satire, than with argument. But there is much vigorous logic in his answer; and to it, with an exception we shall presently state, we have no serious objection to take. Mr. George's position, shortly put, is that wages are drawn not from capital, but from labour, and that wages are confiscated by the landlords in the shape of rent. But Mr. George gives no definition of capital, of wages, or of rent ; and his book, after all, is little more than a clever and eloquent logomachy. Capital, in the sense in which he seems to use the term, is the produce of labour, and wages therefore are, as a matter of fact, drawn from labour. The question is, whether they are so drawn directly,—whether they create a wages fund pari pas= with their exhaustion of it. It is possible to imagine a case, as that of a colony in a new land, put by Mr. George, where at the very outset such a state of things would obtain. But in societies not in their merest infancy, some accumulation of wealth takes place, and must take place if civilisation is to become possible ; and Mr. George does not tell us what becomes of the accumu- lated wealth if it is not, more or less of it, expended in wages under one form or another. He may answer that such wealth consists in reality of wages from the begin- ning held back somehow by the capitalist—or the landlord. But the holding-back is a necessary condition of continued pro- duetion, and thus the wage-earners of one generation profit as much by the enforced savings of preceding generations, as they lose by being obliged to forego more or less of their earnings in the interests of posterity. Hence, Mr. George's contention is an unreality, a mere definition-struggle with the orthodox econo- mists. The real difficulty is to determine what share labour— in the usual acceptation of the term—ought to have in the management of the accumulated funds whence wages are drawn. It is equally easy to meet Mr. George's general argument concerning rent. It is impossible to escape the payment of some form of rent ; an advantage of soil or situation must always command a price. But this price, says Mr. George, not being due to any individual merit or toil, should be paid to the nation for the benefit of all. In other words, he would abolish rent altogether, and replace it by a land-tax. But who would profit by the change? To answer the question, let us consider what becomes of existing rent when paid. Some of it is con- sumed abroad by absentee proprietors, or in purchasing foreign produce or luxuries, and some of it is simply squandered; but the immensely larger proportion of it is used as coinmercial capital, and is distributed as wages—Mr. George, perhaps, would say, in indemnifying contemporary labour for the confiscations practised upon former generations of labourers. Now, what would the State do with so much of its land-tax as was not in some way or other squandered, peculated, or lost ? It could only use it either in making free gifts, or in paying market wages for labour; either in pauperising the people, or—just as the land- lords use it. Here, again,Mr. George entirely misses the real issue. It might be possible to show that the State would be a better landlord than the individual proprietor,—we are sure, for our part, that it would be an infinitely worse one,—or to argue that, in the interests of the whole people, the powers of landlords should be subject to State regulation. But he makes neither attempt, —he simply bids us enact a statute or two, and abolish vice, misery, and poverty by Act of Parliament. With the practical objections to his scheme we have not space to deal. They are excellently set forth by Mr. Mallock, who is careful, at the same time, to sift out the grains of truth that, like gold in the sand of an African river, occasionally glitter in the rolling rhetoric of his adversary. Bat there must be a certain proportion of gold to the ton, to make it worth while to wash the sand. Mr. George's views are worth refuting, not because they are likely to "madden the people," as Mr. Mallock supposes, nor by reason of the accessions to economical or social science likely to result from their exposition, but simply because they furnish a capital occa- sion for inculcating the necessity of scientific accuracy in facts, and strict logic in reasoning in sociological as in other inquiries.
Apart from a certain flippancy we meet with here and there, Mr. Mallock has performed his task well. No doubt Mr. Chamberlain, when he wrote in the Fortnightly Review that "never before was the misery of the very poor more intense, or the conditions of the daily life of the great majority more hopeless and degraded," displayed some want of knowledge of the social history of England. But the frequent sneering allu- sions to the President of the Board of Trade that disfigure Mr. Mallock's pages are as unnecessary to the argument as they are opposed to good-taste, and we cannot but regard them as serious blemishes in an entertaining and instructive book, that has many positive as well as merely polemical excellencies.
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