Wealthy Capital and Credit. 49 



appropriated and exchanged, the latter, such only as may be em- 

 ployed in production, or at most, such as are set aside for produc- 

 tive purposes. Hence, all capital is wealth but all wealth is not 

 capital. Wealth is generic, capital is specific. Capital is some- 

 times called labor of the past. It is the result rather of the 

 combination of past labor and natural agents. The knowledge 

 and skill of workmen also are by some included under the head 

 of capital. There are grave objections to such a classification. It 

 tends to break down all distinction between capital and labor, or 

 rather, between capital and laborers. All labor implies a union 

 of physical and intellectual effort, and the same reasoning which 

 is urged in favor of reckoning the acquired knowledge and skill 

 of the laborer as a part of capital would, if followed to its logi- 

 cal results, include his physical strength also in the same category. 

 It is claimed that men sell their skill — their intellectual and 

 physical dexterity. If this be true, then they also sell their mere 

 physical powers. The truth is they sell neither. The results of 

 each are bought and sold in the market — not these powers and 

 capacities themselves. It is a characteristic of the latter that they 

 are retained and used — not parted with at all. Nor is the skill 

 of a mechanic, strictly speaking, something owned. Possession 

 implies something outside of the possessor. Knowledge and skill 

 and physical power go to make up the man, — they are a part of 

 what he 25, not what he has. Labor helps to create capital, and. 

 the powers of the laborer, whether natural or acquired, are poten- 

 tial labor. 



We are now in a better condition to understand the nature and 

 chief functions of credit As the etymology of the word signi- 

 fies, credit is trust — confidence. Prof. Fawcett defines it as 

 " power to borrow." From the standpoint of the borrower this 

 is correct, but back of this power and essential to its exercise is 

 the trast imposed by the creditor. In its generic sense, credit is 

 implied in all mutual dependence and mutual helpfulness. With- 

 out it, society would be impossible and human intercourse prac- 

 tically at an end. As applied in the affairs of life, credit is 

 reliance on the integrity, energy and skill of one's fellow men^ and 

 the extent to which it may be safely carried is one of the highest 

 4- 



