CarruTuEers.—On some of the Terms used in Political Economy. 23 
Capital in this meaning is of so much importance that some further 
examination of it is required. 
The capitalists, who are the owners of the whole of the wealth of the 
community, must give some of it to the workmen to induce in them an 
effective wish to produce a further supply; the wealth so given forms what 
may be called the wages fund. As it is greater or less compared to the 
numbers of the workmen, wages will be high or low. 
The wages fund embraces all wealth which is being “ expended” (as 
before defined), that is, which is being given to labourers, who are employed 
in producing something which the capitalist will himself consume; as 
well as that which is being “invested.” The present prosperity of the 
labourer depends on it alone; but that prosperity will only last the year, 
unless the “invested fund” forms a large proportion of the total wages 
fund. Next year's prosperity depends on the “invested fund," which will 
produce the wages fund of next year, since the capitalists have placed all 
that itis instrumental in producing beyond their own reach, in so far as 
they have willed that it shall be in the form of those commodities which 
workmen generally use. Future prosperity will depend on the fature actions 
of the capitalists; if they resolve to expend their wealth for their own 
gratifieation, the labouring classes will not suffer during the following 
year, as they will then be as fully paid for producing commodities for the 
capitalists' use as they had been before. Their privations will not begin 
until the second year, when the capitalists will keep for themselves all the 
wealth produced by last year's labour. . 
If an individual capitalist is content not to consume a larger proportion 
of his share of the common wealth than the average of his fellows, he will 
be able to enjoy that proportion every year, and still keep good his claim to 
the proportion of the whole year's produce to which he was originally 
entitled. The part he consumes is often called the interest on his 
capital, and the part he invests, capital. By a false analogy, it is generally 
supposed that the wealth of the whole community is also divided into 
capital and interest, and that if the community consumes more than its 
interest it encroaches on its capital, and is on the downward road to 
ruin. An article lately appeared in the London Times, which argued from 
some manipulation of that bugbear of political economists, the returns of 
exports and imports, that England was “ expending its capital," and, like a 
spendthrift squire, would soon be ruined unless she retrenched. Ruin to 
the squire would mean that in future the poor fellow would have to work 
for his living, and it would be hard to say when England was not in that 
unhappy state. 
