When cost is used in a sense which makes labor one of its elements, wages are not an element in so far as they vary from employment to employment, or in any other way. In the sense of cost in which wages are an element, the variation of the latter from employment to employment is an irrelevant consideration. Again we find such an observation as the following: “The relative wages of the labour necessary for producing different commodities affect their value just as much as the relative quantities of labour.”[163] In the chapter on Ricardo, we saw how this form of expression originated, and determined what the comparatively simple truth is which it so awkwardly conveys. Wages cost, instead of affecting values “as much as” labor cost, does the whole of the affecting; and labor cost affects values only as it affects wages cost. The end of it all is, Mill concludes, with Ricardo (and without improvement upon Ricardo), that a variation of the general rate of wages alters the exchange relations of commodities produced with different combinations of “fixed” and “circulating” capital, independently of the comparative labor costs of the same. What is true of Ricardo’s statement is true of this. The proposition regarding the effect of a change of the general rate of wages (or of the rate of profits, for one must always accompany the other in the view of Ricardo and Mill) upon “relative values,” may be a true dynamical principle; but the qualification of the original labor-cost theory of value which is contained in this is statical. Exchange values are statically out of proportion to comparative labor costs, without any reference to changes in rates of wages and profits.[164] The reason is that interest is an element in entrepreneur’s costs as well as wages. Of the total of wages plus interest, in some cases interest may be 30 per cent., in other cases 60 per cent., or virtually any other per cent. Values being in proportion to the total, cannot be in proportion to either element alone.[165] 5. Up to the present point, Mill has not taken a decided stand in favor of any qualification of the labor-cost theory which Ricardo had not also approved. In his treatment of skilled labor he admits of a further qualification. Ricardo handled the subject in a very unsatisfactory manner. While he gave the appearance of finding no difficulty for his law of value in skilled labor, he unconsciously evaded the real question at issue. Mill writes: “When the wages of an employment permanently exceed the average rate, the value of the thing produced will, in the same degree, exceed the standard determined by mere quantity of labour. Things, for example, which are made by skilled labour, exchange for the produce of a much greater quantity of unskilled labour; for no reason but because the labour is more highly paid.”[166]