52 Wisconsin Academy of Sciences, Arts, and Letters. 



2. Next Ave liave to study Capital. It will serve for a gen- 

 eral definition to say Cajyital is that jKirt of loealth lohich is act- 

 ually employed in production. Wealth is a broader term. Cap- 

 pital is a part of wealth. It is not synonymous with money, 

 for money itself does not go into production. More specifically 

 Capital is the sum toted of the products of former labor empjloyed to 

 provide shelter, protection, tools and materials for the processes of the 

 production and to feed and otherwise to maintain the laborers during 

 the process. This threefold classification of capital should be 

 particularly noticed. There are the instruments of production 

 — as land, buildings, tools and machinery — the materials on 

 which labor is expended, such as wheat, iron, cotton, leather, 

 etc., and also houses, food and clothing for the safety and sup- 

 port of the laborers while engaged in productive operations. 

 The items last named are usually provided for by the laborers 

 themselves out of the wages paid them. Wages therefore rep- 

 resents this form of capital, whether paid in money or in rent 

 and groceries and dry-goods. 



Capital is not money but things in one or other of these 

 forms. What a manufacturer wants is not money but a steam 

 engine and gearing and spindles and looms and cotton. La- 

 borers look at their money- wages only as means for procuring 

 food and raiment and the protection of a home. Money is but 

 the convenient instrument of exchange. The same money 

 may go out of the bank in the morning, run around a busy 

 circuit and get back in the afternoon. In its circuit, perhaps, 

 it sent a machine to the shop and a load of wool to the mill 

 and a load of potatoes to the laborer's home, but it comes 

 back just what it went out ; money is nothing else, though its 

 value is represented threefold in as many forms of capital. So 

 far as money has in itself real value it is a part of the products 

 of former labor, saved and set apart for this specific service in 

 the exchange of products. So it is capital in the form of an 

 instrument which aids production. Banking capital is thus a 

 portion of the wealth of a community appropriated to this ob- 



