An Inquiry into the Nature and Causes of the Wealth of Nations by Adam Smith (ebook reader macos .TXT) 📕

what are in this system called the original and annual expenses

(depenses primitives, et depenses annuelles), which they lay out

upon the cultivation of the land. The original expenses consist

in the instruments of husbandry, in the stock of cattle, in the

seed, and in the maintenance of the farmer’s family, servants,

and cattle, during at least a great part of the first year of his

occupancy, or till he can receive some return from the land. The

annual expenses consist in the seed, in the wear and tear of

instruments of husbandry, and in the annual maintenance of the

farmer’s servants and cattle, and of his family too, so far as

any part of them can be considered as servants employed in

cultivation. That part of the produce of the land which remains

to him after paying the rent, ought to be sufficient, first, to

replace to him, within a reasonable time, at least during the

term of his occupancy, the whole of his original expenses,

together with the ordinary profits of stock; and, secondly, to

replace to him annually the whole of his annual expenses,

together likewise with the ordinary profits of stock. Those two

sorts of expenses are two capitals which the farmer employs in

cultivation; and unless they are regularly restored to him,

together with a reasonable profit, he cannot carry on his

employment upon a level with other employments; but, from a

regard to his own interest, must desert it as soon as possible,

and seek some other. That part of the produce of the land which

is thus necessary for enabling the farmer to continue his

business, ought to be considered as a fund sacred to cultivation,

which, if the landlord violates, he necessarily reduces the

produce of his own land, and, in a few years, not only disables

the farmer from paying this racked rent, but from paying the

reasonable rent which he might otherwise have got for his land.

The rent which properly belongs to the landlord, is no more than

the neat produce which remains after paying, in the completest

manner, all the necessary expenses which must be previously laid

out, in order to raise the gross or the whole produce. It is

because the labour of the cultivators, over and above paying

completely all those necessary expenses, affords a neat produce

of this kind, that this class of people are in this system

peculiarly distinguished by the honourable appellation of the

productive class. Their original and annual expenses are for the

same reason called, In this system, productive expenses, because,

over and above replacing their own value, they occasion the

annual reproduction of this neat produce.

The ground expenses, as they are called, or what the landlord

lays out upon the improvement of his land, are, in this system,

too, honoured with the appellation of productive expenses. Till

the whole of those expenses, together with the ordinary profits

of stock, have been completely repaid to him by the advanced rent

which he gets from his land, that advanced rent ought to be

regarded as sacred and inviolable, both by the church and by the

king ; ought to be subject neither to tithe nor to taxation. If

it is otherwise, by discouraging the improvement of land, the

church discourages the future increase of her own tithes, and the

king the future increase of his own taxes. As in a well ordered

state of things, therefore, those ground expenses, over and above

reproducing in the completest manner their own value, occasion

likewise, after a certain time, a reproduction of a neat produce,

they are in this system considered as productive expenses.

The ground expenses of the landlord, however, together with the

original and the annual expenses of the farmer, are the only

three sorts of expenses which in this system are considered as

productive. All other expenses, and all other orders of people,

even those who, in the common apprehensions of men, are regarded

as the most productive, are, in this account of things,

represented as altogether barren and unproductive.

Artificers and manufacturers, in particular, whose industry, in

the common apprehensions of men, increases so much the value of

the rude produce of land, are in this system represented as a

class of people altogether barren and unproductive. Their labour,

it is said, replaces only the stock which employs them, together

with its ordinary profits. That stock consists in the materials,

tools, and wages, advanced to them by their employer; and is the

fund destined for their employment and maintenance. Its profits

are the fund destined for the maintenance of their employer.

Their employer, as he advances to them the stock of materials,

tools, and wages, necessary for their employment, so he advances

to himself what is necessary for his own maintenance; and this

maintenance he generally proportions to the profit which he

expects to make by the price of their work. Unless its price

repays to him the maintenance which he advances to himself, as

well as the materials, tools, and wages, which he advances to his

workmen, it evidently does not repay to him the whole expense

which he lays out upon it. The profits of manufacturing stock,

therefore, are not, like the rent of land, a neat produce which

remains after completely repaying the whole expense which must be

laid out in order to obtain them. The stock of the farmer yields

him a profit, as well as that of the master manufacturer; and it

yields a rent likewise to another person, which that of the

master manufacturer does not. The expense, therefore, laid out in

employing and maintaining artificers and manufacturers, does no

more than continue, if one may say so, the existence of its own

value, and does not produce any new value. It is, therefore,

altogether a barren and unproductive expense. The expense, on the

contrary, laid out in employing farmers and country labourers,

over and above continuing the existence of its own value,

produces a new value the rent of the landlord. It is, therefore,

a productive expense.

Mercantile stock is equally barren and unproductive with

manufacturing stock. It only continues the existence of its own

value, without producing any new value. Its profits are only the

repayment of the maintenance which its employer advances to

himself during the time that he employs it, or till he receives

the returns of it. They are only the repayment of a part of the

expense which must be laid out in employing it.

The labour of artificers and manufacturers never adds any thing

to the value of the whole annual amount of the rude produce of

the land. It adds, indeed, greatly to the value of some

particular parts of it. But the consumption which, in the mean

time, it occasions of other parts, is precisely equal to the

value which it adds to those parts; so that the value of the

whole amount is not, at any one moment of time, in the least

augmented by it. The person who works the lace of a pair of fine

ruffles for example, will sometimes raise the value of, perhaps,

a pennyworth of flax to �30 sterling. But though, at first sight,

he appears thereby to multiply the value of a part of the rude

produce about seven thousand and two hundred times, he in reality

adds nothing to the value of the whole annual amount of the rude

produce. The working of that lace costs him, perhaps, two years

labour. The �30 which he gets for it when it is finished, is no

more than the repayment of the subsistence which he advances to

himself during the two years that he is employed about it. The

value which, by every day’s, month’s, or year’s labour, he adds

to the flax, does no more than replace the value of his own

consumption during that day, month, or year. At no moment of

time, therefore, does he add any thing to the value of the whole

annual amount of the rude produce of the land : the portion of

that produce which he is continually consuming, being always

equal to the value which he is continually producing. The extreme

poverty of the greater part of the persons employed in this

expensive, though trifling manufacture, may satisfy us that the

price of their work does not, in ordinary cases, exceed the value

of their subsistence. It is otherwise with the work of farmers

and country labourers. The rent of the landlord is a value which,

in ordinary cases, it is continually producing over and above

replacing, in the most complete manner, the whole consumption,

the whole expense laid out upon the employment and maintenance

both of the workmen and of their employer.

Artificers, manufacturers, and merchants, can augment the revenue

and wealth of their society by parsimony only ; or, as it is

expressed in this system, by privation, that is, by depriving

themselves of a part of the funds destined for their own

subsistence. They annually reproduce nothing but those funds.

Unless, therefore, they annually save some part of them, unless

they annually deprive themselves of the enjoyment of some part of

them, the revenue and wealth of their society can never be, in

the smallest degree, augmented by means of their industry.

Farmers and country labourers, on the contrary, may enjoy

completely the whole funds destined for their own subsistence,

and yet augment, at the same time, the revenue and wealth of

their society. Over and above what is destined for their own

subsistence, their industry annually affords a neat produce, of

which the augmentation necessarily augments the revenue and

wealth of their society. Nations, therefore, which, like France

or England, consist in a great measure, of proprietors and

cultivators, can be enriched by industry and enjoyment.

Nations, on the contrary, which, like Holland and Hamburgh, are

composed chiefly of merchants, artificers, and manufacturers, can

grow rich only through parsimony and privation. As the interest

of nations so differently circumstanced is very different, so is

likewise the common character of the people. In those of the

former kind, liberality, frankness, and good fellowship,

naturally make a part of their common character ; in the latter,

narrowness, meanness, and a selfish disposition, averse to all

social pleasure and enjoyment.

The unproductive class, that of merchants, artificers, and

manufacturers, is maintained and employed altogether at the

expense of the two other classes, of that of proprietors, and of

that of cultivators. They furnish it both with the materials of

its work, and with the fund of its subsistence, with the corn and

cattle which it consumes while it is employed about that work.

The proprietors and cultivators finally pay both the wages of all

the workmen of the unproductive class, and the profits of all

their employers. Those workmen and their employers are properly

the servants of the proprietors and cultivators. They are only

servants who work without doors, as menial servants work within.

Both the one and the other, however, are equally maintained at

the expense of the same masters. The labour of both is equally

unproductive. It adds nothing to the value of the sum total of

the rude produce of the land. Instead of increasing the value of

that sum total, it is a charge and expense which must be paid out

of it.

The unproductive class, however, is not only useful, but greatly

useful, to the other two classes. By means of the industry of

merchants, artificers, and manufacturers, the proprietors and

cultivators can purchase both the foreign goods and the

manufactured produce of their own country, which they have

occasion for, with the produce of a much smaller quantity of

their own labour, than what they would be obliged to employ, if

they were to attempt, in an awkward and unskilful manner, either

to import the one,