256 STUDIES, SCIENTIFIC AND SOCIAL 



Real and Fictitious Wealth. 



Nothing is more certain than that wealth real wealth 

 is continually used up and destroyed, and as continually 

 reproduced by fresh labour. All articles of food, of 

 clothing, of furniture, and even tools, machines, dwellings, 

 books, works of art, and ornaments, are either wholly or 

 partly used up day by day or year by year, and as 

 continually reproduced ; and it is those which are most 

 continually consumed and reproduced which are, 

 pre-eminently, beneficial wealth. If, then, a man acquires 

 a large surplus of this real wealth beyond what he can 

 consume himself, it must be either profitably consumed 

 by others or be wasted by natural decay. In either case 

 it soon ceases to exist. But our fiscal and legislative 

 arrangements enable a man to change this perishable 

 wealth into securities which bring him a permanent income 

 an income supposed to be perpetual, but at all events 

 lasting long after the wealth of which it is the symbol, 

 and which is supposed to produce it, has totally 

 disappeared. Incomes thus derived constitute a tax or 

 tribute on the community, for which it receives nothing 

 in return, and may truly be termed fictitious wealth. 



To show that this is so, and at the same time to exhibit 

 clearly not only the evil but the inherent absurdity of 

 these arrangements, let us consider a few indisputable 

 facts. Every year much surplus wealth is accumulated 

 by individuals and is invested as reproductive capital. 

 This invested capital goes on producing an income which, 

 it is supposed, is and ought to be permanent ; and as more 

 and more surplus wealth is continually produced and 

 invested, it is evident that the permanent incomes thus 

 derived will continually increase, and thus in each suc- 

 cessive generation a larger and larger number of persons 

 will be enabled to live in idleness on incomes derived 

 from this invested capital. But this is a state of things 

 that evidently carries with it its own destruction, since a 

 time must come when the number of idle persons living 

 on " independent incomes," and the aggregate of those 



