but it does not impoverish. But what are savings? The surplus of wealth made over wealth consumed. If it is turned into capital and applied to increased production, the nation becomes richer; if it is expended on any luxury or any folly, the nation is where it is." These declarations no one, we imagine, will dispute.
But Prof. Price, in attributing business stagnation to extravagance, to "over-spending and over-consuming," assumes the whole question. He produces no evidence whatever in support of the attestation. He does not show that consumption and expenditure have exceeded production; he declares that capital has been impaired, but gives no facts nor figures in support of the affirmation. The whole groundwork of his theory is boldly and flatly assumed, without the slightest regard whether there is evidence to support it or not. It is grossly illogical to assume that there is over-spending simply because to casual observation there is high and extravagant living. A class may be extravagant; a group of people may be impairing their capital; but where are the figures to show that the English people as a whole have been indulging in undue excesses, have reduced the sum of their savings, "by which the means of producing are diminished?" There is absolutely nothing whatever upon which to base these assumptions! Prof. Price tells us in another place that "her (England's) producing power, her fixed capital, her machinery, remain unchanged," and that "she is compelled to shut up many of her factories, to dismiss or put on half-time immense numbers of her working-people, because there are fewer buyers of the articles they manufacture." This, he declares, is the very pinch of the matter. Indisputably it is, but whether fewer buyers is the consequence of over-consumption or of some other cause is also the pinch of the philosophy of the matter—and this let us ascertain, if it is possible to do so.
How is it, if the savings of a country have been really impaired, that capital at the same moment should be seeking investment at any rate of interest it can command—that all the financial centres are choked with an excess of money, for which it is impossible to find borrowers? Assuredly, loans at a low rate of interest imply an excess of capital over the needs of trade or production; it shows that business operations are restricted, for whatever reason, and have released capital from its ordinary uses to such an extent that it accumulates in trade-centres, seeking for borrowers that do not come. It can make no difference whether we call money capital or not; it cannot affect the heart of the question what it is that is offered at one per cent.—gold, notes, assets of any kind—whatever money may really be, it would seem clear that, if over-consumption had impaired the capital of the country, those individuals who could come into the field as lenders would be enabled to dictate terms to the needy borrowers. Over-consumption means a destruction of food, clothing, coals, metals, etc., to an extent that impairs the reserves of these
