Principles of Political Economy: Abridged with Critical, Bibliographical, and Explanatory Notes, and a Sketch of the History of Political Economy
John Stuart Mill · en
Now into a community, as here pictured, all laborers supposed to
be occupied, and all capital employed in producing A, B, C, ... X,
Y, Z, imagine the coming of a shipwrecked crew. Instead of
exchanging Z for A, as before, the owner of Z may offer his wealth
to the crew to dance for him. The essential question is, Is more
employment offered to labor by this action than the former
exchange for A? That is, it is a question merely of distribution
of wealth among the members of a community. The labor engaged on A
is not thrown out of employment (if they have warning). There is
no more wealth in existence, but it is differently distributed
than before: the crew, instead of the former owner, now have 1,000
of Z. So far as the question of employment is concerned, it makes
no difference on what terms the crew got it: they might have been
hired to stand in a row and admire the owner of Z when he goes
out. But yet it may naturally be assumed that the crew were
employed productively. In this case, after they have consumed the
wealth Z, they have brought into existence articles in the place
of those they consumed. But, although this last operation is
economically more desirable for the future growth of wealth, yet
no more laborers for the time were employed than if the crew had
merely danced. The advantages or disadvantages of productive
consumption are not to be discussed here. It is intended, however,
to establish the proposition that _wealth paid out in wages, or
advanced to producers, itself supports labor_; that wealth offered
directly to laborers in this way employs more labor than when
merely offered in exchange for other goods, or, in other words, by
a demand for commodities; that an increased demand for commodities
does not involve an increased demand for labor, since this can
only be created by capital. The essential difference is, that the
owner of Z in one case, by exchanging goods for A, did not forego
his consuming power; in the other case, by giving Z to the
unemployed crew, he actually went through the process of saving by
foregoing his personal consumption, and handing it over to the
crew. If the crew use it unproductively, it is in the end the same
as if the owner of Z had done it; but meanwhile the additional
laborers were employed. If the crew be employed productively, then
the saving once made will go on forever, as explained above, and
the world will be the richer by the wealth this additional capital
can create.