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Page 12
What is _interest_? It is the service rendered, after a free bargain, by
the borrower to the lender, in remuneration for the service he has
received by the loan. By what law is the rate of these remunerative
services established? By the general law which regulates the equivalent
of all services; that is, by the law of supply and demand.
The more easily a thing is procured, the smaller is the service rendered
by yielding it or lending it. The man who gives me a glass of water in
the Pyrenees, does not render me so great a service as he who allows me
one in the desert of Sahara. If there are many planes, sacks of corn, or
houses, in a country, the use of them is obtained, other things being
equal, on more favourable conditions than if they were few; for the
simple reason, that the lender renders in this case a smaller _relative
service_.
It is not surprising, therefore, that the more abundant capitals are,
the lower is the interest.
Is this saying that it will ever reach zero? No; because, I repeat it,
the principle of a remuneration is in the loan. To say that interest
will be annihilated, is to say that there will never be any motive for
saving, for denying ourselves, in order to form new capitals, nor even
to preserve the old ones. In this case, the waste would immediately
bring a void, and interest would directly reappear.
In that, the nature of the services of which we are speaking does not
differ from any other. Thanks to industrial progress, a pair of
stockings, which used to be worth six francs, has successively been
worth only four, three, and two. No one can say to what point this value
will descend; but we can affirm that it will never reach zero, unless
the stockings finish by producing themselves spontaneously. Why? Because
the principle of remuneration is in labour; because he who works for
another renders a service, and ought to receive a service. If no one
paid for stockings, they would cease to be made; and, with the scarcity,
the price would not fail to reappear.
The sophism which I am now combating has its root in the infinite
divisibility which belongs to _value_, as it does to matter.
It appears at first paradoxical, but it is well known to all
mathematicians, that, through all eternity, fractions may be taken from
a weight without the weight ever being annihilated. It is sufficient
that each successive fraction be less than the preceding one, in a
determined and regular proportion.
There are countries where people apply themselves to increasing the size
of horses, or diminishing in sheep the size of the head. It is
impossible to say precisely to what point they will arrive in this. No
one can say that he has seen the largest horse or the smallest sheep's
head that will ever appear in the world. But he may safely say that the
size of horses will never attain to infinity, nor the heads of sheep to
nothing.
In the same way, no one can say to what point the price of stockings nor
the interest of capitals will come down; but we may safely affirm, when
we know the nature of things, that neither the one nor the other will
ever arrive at zero, for labour and capital can no more live without
recompense than a sheep without a head.
The arguments of M. Proudhon reduce themselves, then, to this:--Since
the most skilful agriculturists are those who have reduced the heads of
sheep to the smallest size, we shall have arrived at the highest
agricultural perfection when sheep have no longer any heads. Therefore,
in order to realise the perfection, let us behead them.
I have now done with this wearisome discussion. Why is it that the
breath of false doctrine has made it needful to examine into the
intimate nature of interest? I must not leave off without remarking upon
a beautiful moral which may be drawn from this law:--"The depression of
interest is proportioned to the abundance of capitals." This law being
granted, if there is a class of men to whom it is more important than to
any other that capitals be formed, accumulate, multiply, abound, and
superabound, it is certainly the class which borrows them directly or
indirectly; it is those men who operate upon _materials_, who gain
assistance by _instruments_, who live upon _provisions_, produced and
economised by other men.
Imagine, in a vast and fertile country, a population of a thousand
inhabitants, destitute of all capital thus defined. It will assuredly
perish by the pangs of hunger. Let us suppose a case hardly less cruel.
Let us suppose that ten of these savages are provided with instruments
and provisions sufficient to work and to live themselves until harvest
time, as well as to remunerate the services of eighty labourers. The
inevitable result will be the death of nine hundred human beings. It is
clear, then, that since 990 men, urged by want, will crowd upon the
supports which would only maintain a hundred, the ten capitalists will
be masters of the market. They will obtain labour on the hardest
conditions, for they will put it up to auction, or the highest bidder.
And observe this,--if these capitalists entertain such pious sentiments
as would induce them to impose personal privations on themselves, in
order to diminish the sufferings of some of their brethren, this
generosity, which attaches to morality, will be as noble in its
principle as useful in its effects. But if, duped by that false
philosophy which persons wish so inconsiderately to mingle with economic
laws, they take to remunerating labour largely, far from doing good,
they will do harm. They will give double wages, it may be. But then,
forty-five men will be better provided for, whilst forty-five others
will come to augment the number of those who are sinking into the grave.
Upon this supposition, it is not the lowering of wages which is the
mischief, it is the scarcity of capital. Low wages are not the cause,
but the effect of the evil. I may add, that they are to a certain extent
the remedy. It acts in this way: it distributes the burden of suffering
as much as it can, and saves as many lives as a limited quantity of
sustenance permits.
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