CORRESP ONDENCE. 



489 



point, the next thing to be done was to find 

 out where I lived ; and this he did by ac- 

 companying me to my office. Seeing her 

 vomit, lie brought her a tin pan, which he 

 probably had seen her use for that purpose, 

 and then set out for my office. The dog 

 called for me a number of times afterward, 

 but never without my services were needed. 

 He was never told to fetch me, but deter- 

 mined himself when it was necessary to do 

 so. Yours, respectfully, 



John Sundberg, M. D. 



Baltimore, December 4, 1876. 



To the Editor of the Popular Science Monthly. 



Sir : In an article headed " Over-Con- 

 sumption or Over-Production? " in your July 

 issue, Mr. Buuce offers an answer to the 

 question, " Why are the times so hard ? " 

 taking as his text Prof. Bonamy Price's ar- 

 ticle, " One per Cent.," which he pronounces 

 to be illogical, fallacious, and based on unwar- 

 ranted assumptions. It is not easy to dis- 

 entangle Mr. Bunce's argument, but the fol- 

 lowing is believed to be a fair statement of 

 the propositions it involves : 



1. That the common ideas in regard to 

 national extravagance are erroneous, it be- 

 ing something essentially diffiirent from in- 

 dividual extravagance. 



2. That wasteful consumption has had 

 nothing to do with commercial distress ; 

 that, on the contrary, destruction produces 

 abundance. 



3. That no part of the nation's capital 

 has been lost in unproductive enterprises. 



4. That the real cause of the trouble is 

 over-production. 



5. That the remedy lies in cooperation 

 among producers to regulate production. 



A refutation of these propositions is not 

 the object of this letter; all that time and 

 space will allow is to stand them up, stripped 

 of verbiage, and see how they will look. 



In the first place, concerning national 

 extravagance, after pronouncing the idea or- 

 dinarily held to be " peculiarly erroneous," 

 Mr. Bunce says : " We think it can be 

 shown that expenditure in the case of the 

 individual, and expenditure in the case of a 

 large number of individuals, have certain 

 essential diffijrences, the difference being 

 that the income of the former is absolutely 

 fixed, while that of the latter is wholly ex- 

 pansive." As it stands, this proposition 

 must mean that wastefulness, a bad thing 

 in the case of the individual, becomes in 

 the case of an aggregate of individuals a 

 good thing ; it means that, each man's in- 

 come being fixed, he cannot safely live be- 

 yond it ; but, if we add together a " large 

 group " of these incomes, they become 

 " wholly expansive," whatever that may be. 



and cannot be too recklessly spent ; it 

 means, in short, that the whole is some- 

 thing totally different from the sum of its 

 parts. 



Mr. Bunce tells us that " a community 

 is rich because it consumes^ abundance being 

 the product and consequent of excessive de- 

 struction." And here is the proof : "It is 

 evident that the immense consumption of 

 coal has made coal cheap and abundant. 

 It has rendered possible the employment 

 of vast capital in the erection of costly ma- 

 chinery for working, transporting, etc. . . . 

 It is true, the consumption of coal is in- 

 creased by cheapness, but it is only by ex- 

 travagance that the machinery by which it 

 is made cheap is put in operation. We 

 have an immense wealth of coal because 

 we consume coal so extensively ! " This 

 rule, we are told, works in all, or nearly all, 

 our staples, and the conclusion is, " that 

 in all staple things a nation is rich because 

 it consumes." Was ever the operation of 

 the law of supply and demand so grotesque- 

 ly construed ? That the demand for a com- 

 modity stimulates the activity of supply is 

 most true, and, where increase is possible, 

 the supply is increased until the widest area 

 of demand is filled at a minimum cost, but 

 it is only by economy that this minimum 

 can be reached. It is surely only necessary 

 to remember that, no matter what the em- 

 ployment of capital or appliance of machin- 

 ery, every ton of coal moved a foot repre- 

 sents a given unit of force in the total sum 

 available for supplying human needs, and 

 that, when so used, it cannot be applied to 

 other work, in order to see the full absurd- 

 ity of the proposition that the nation is the 

 richer if the product be wastefuUy destroyed 

 instead of being husbanded and prudently 

 used ! 



The third point made, that no part of 

 the capital of the country has been lost in 

 unproductive enterprises, deserves, perhaps, 

 a little fuller attention because of the pecul- 

 iar reasoning by which it is sought to be 

 sustained. Mr. 13unce says that these works 

 were largely carried on by what he calls 

 " released energy, by labor not otherwise re- 

 quired," and that so far " the community is 

 not the poorer by a mite in consequence." 

 He is willing to admit that, by the purchase 

 ofiron abroad, etc., we have lost a part of our 

 " surplus," but he declares that " the as- 

 sumption that it impaired our capital is 

 wholly groundless." With such a use of 

 terms, it becomes needful to define what is 

 meant by capital in an economic sense, and 

 to point out the difference between it and 

 the capital stock and surplus of a bank or 

 a life-insurance company. The latter are 

 terms used to designate what a book-keeper 

 knows as the fictitious accounts which show 

 the amount of assets of a corporation; it is 

 a purely artificial division which has been 



