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DEFINITIONS, AND DIVISION OF THE SUBJECT.
1. POLITICAL ECONOMY is the Science of Wealth. It is sometimes defined the Science of National Wealth. This definition seems not, however, sufficiently comprehensive; inasmuch as, the laws which govern the creation of wealth are essentially the same, whether they are considered in respect to man as an individual, or to man as a society.
By Science, as the word is here used, we mean a systematic arrangement of the laws which God has established, so far as they have been discovered, of any department of human knowledge. It is obvious, upon the slightest reflection, that the Creator has subjected the accumulation of the blessings of this life to some determinate laws. Every one, for instance, knows that no man can grow rich, without industry and frugality. Political Economy, therefore, is a systematic arrangement of the laws by which, under our present constitution, the relations of man, whether individual or social, to the objects of his desire, are governed.
2. Wealth. It has been frequently remarked, that the universe around us is composed of objects suited to gratify our desire, and thus minister to our happiness. The capacity to gratify desire, is, therefore, the
first element that enters into our notion of wealth. But as the gratification of our desires, by means of an external object, almost always supposes some change effected in that object; and, as we could have no right to effect that change, unless that object were our own, another element, which enters into the notion of wealth, is the idea of possession. Hence, wealth may be defined any object, having the power of gratifying human desire, which is capable of being appropriated. He who possesses many of these objects in abundance, is termed rich. He who possesses few of them, is termed poor. He who possesses a large amount of money, is also called rich; because, with money, he can generally procure whatever else of physical convenience he may desire.
3. Of value, intrinsic and exchangeable. The particular quality in any substance, which renders it capable of gratifying human desire, is called its value. Thus, that quality of fuel, which constitutes its value, is its power of generating heat, or of gratifying this desire in man. A particular substance may have the power of gratifying either one or several desires, and thus it may have either one or several values. Thus anthracite coal is at present known to have but one value, namely, that of generating heat. Bituminous coal possesses also another, as it is also used in the manufacture of gas for the
purposes of illumination. Wood has several values, inasmuch as, besides being used for fuel, it may also be used for building, and for various purposes in the arts. Iron has as many forms of value, as there are uses to which it may be applied, in promoting the convenience of man.
The degree of the intrinsic value of any substance, depends upon the nature and the number of the desires which it can gratify. If the gratification of that desire to which it is subservient, be necessary to the existence or to the comfort of man, its value will be great. Such is the case with air, water, clothing, food, and fuel. If the gratification which it affords can be easily dispensed with, its value will be small. Such is the case with articles of luxury, or the means of mere amusement. The inferiority of the value of this latter class, is evident from the fact, that, in seasons of scarcity, these are first relinquished. And again, the degree of the value of any substance, depends upon the number of desires which it can gratify. India Rubber, or Caoutchouc, a few years since, was used but for one purpose, that of rubbing out pencil marks. It is now used in the manufacture of shoes, and for several other very important purposes. The intensity of its value is, therefore, greatly increased.
We have thus far treated only of intrinsic value, or of the power which any particular substance possesses, of gratifying human desire.
If, however, we examine the various articles of value around us, we shall observe a very remarkable difference between them. Some of them may be made the means of procuring for us, by exchange, other objects of desire. Such, for instance, are gold, silver, iron, coal, wood, &c. He who possesses a large quantity of either of these, may, ordinarily, procure for himself, by exchange, any thing else that he needs. Others, on the contrary, and those of great intrinsic value, are destitute of this property. What has greater intrinsic value than air, the light of the sun, or water? Yet, we can get nothing in exchange for air or sun-light, and very rarely for water. And again; substances having an exchangeable value, do not possess that value, in proportion to their intrinsic value. Iron has a far greater intrinsic value than gold; yet, an ounce of gold has a far greater exchangeable value than an ounce of iron; that is, an ounce of gold will procure for us many more articles of convenience, in exchange. This latter property, or the power of procuring for us something else in exchange, is called exchangeable value. If, now, we compare those substances which have
not, with those which have exchangeable value, we shall find them to differ in the following respects :
1. Those which have no exchangeable value, are every where abundant and inexhaustible. The supply of the others is limited in quantity or is limited in place. Air, and the light of the sun, are inexhaustible every where. Coal is in some places inexhaustible, but it is not so in others. Where it lies, for miles together, immediately upon the surface, and in beds of unknown thickness, it has no exchangeable value. Where it must be carried to any distance, to be brought to the consumer, it then acquires an exchangeable value.
2. The value of the first class of substances has received no addition from human labor, but derives whatever qualities it possesses, directly from the gift of God. The value of the other, has always received some addition, and, frequently, it is derived altogether from human labor. Neither air, nor the light of the sun, can receive any additional power of gratifying human desire, from any effort of man. On the contrary, all the most important values of iron, are derived from human skill. A lump of iron ore is as valueless as granite or sandstone. The peculiar properties of the metal, are the result of the processes through which it passes. When, however, a substance which ordinarily possesses only intrinsic value, is placed under such circumstances that human labor must be added to it in order to enable it to gratisy desire, it then acquires exchangeable value. Thus water, which ordinarily, has no exchangeable value, is frequently sold by the gallon in cities, because it can be procured in purity only from a distance, and hence, before it can gratify the desire of particular individuals, it requires the labor of transportation to be added to it.
We see then, that every substance on earth may have, and, doubtless, it actually has, intrinsic value. If we then consider all those qualities which are necessary to prepare a substance for the gratification