82 Transactions.— Miscellaneous. 
these commodities better than he can, he will grow wheat or something else 
for which they have a demand, in the hope of trading with them. His 
produee will then depend for its direction on their demand. All other 
capitalists are influenced by the same motives. They know that their 
stock, however ample, will not last long; they therefore labour to replace 
it; if they can, they get others to help them, and, as an inducement, let 
these others share their present stock. All trade is founded on this simple 
principle. , 
Mill,like Rieardo before him, has got confused by giving to the word 
capital, which means the ownership of wealth, the.,definition which should 
be given only to wealth. He uses the word sometimes in the usual—some- 
times in the defined sense. — : 
The velvet-maker has a capital which he employs in making velvet; 
here “ capital” means wealth. He gives his wealth to the weavers who 
help him to make the velvet, and thus to renew his stock of wealth. Again, 
the velvet-buyer has a capital which he devotes to buying the velvet. Here 
“ capital” means not wealth, but the ownership of wealth ; a right to a share 
of the wealth produced in the world, which share is taken in the form of 
velvet. The velvet-maker does not want velvet for himself; like the farmer, 
he produces things he does not want, so as, by trade, to get the things he - 
does want. His own demand for commodities has made him work, and 
his neighbours' demand for velvet has given the direction to his work. 
There has been only one portion of wealth employed in making the 
velvet, that of the velvet-maker. The wealth of the velvet-buyer has been 
employed about something else. He also has been making something he 
did not want, so that he could get what he did want, which was velvet. 
Mill's arguments are founded on the erroneous supposition that there were 
two portions of wealth employed about it. 
If the velvet-buyer put his money into the bank, as supposed in my 
illustration, it would have been unnecessary for the velvet-maker to have 
any capital at all; he could have borrowed it from the bank, and thus the. 
velvet-buyer would have supplied almost directly the commodities which 
maintained the velvet-weavers while they were at work. 
It will thus appear that Mill's fourth theorem is erroneous, and the 
corollaries he draws from it equally so. If a capitalist spends his wealth 
in employing retainers of any kind, he does no more good to the working 
classes than if he spent it by exchanging it for velvet or diamonds. 
His own demand for commodities is the only cause that his own stock 
of wealth is employed in feeding and clothing labourers while they are 
engaged in producing new wealth. If he does not himself produce the 
very commodities he wants, it is merely because it is more convenient to 
