Another modern writer a disciple, too, of the school of Adam Smith to whose work I have already referred, discerned the particular principle of which I am now treating; but although he discerned it, he failed to place it rightly and to preserve it. I allude to Mr. M'Culloch, who, in the introductory chapter of his work on the Principles of Political Economy, has maintained rightly, and most importantly, that the science may be denominated "The Science of Values."

It is, then, at this early or rudimentary part of the subject, now under discussion, that a most important difference arises in the treatment of the science, first as regards the principle which has to be discerned, introduced, and established; and next as regards the system which has to be constructed upon the principle. At this early stage it is that I have to separate from the company of the modern school of writers on Political Economy, and to pursue courses that have a very different character and direction from the courses adopted by them. Adam Smith, and his school of reasoners, though frequently adducing evidence against it, and arguing against it, yet have adopted the free and competitive course of action and of commerce, a course from which all law. all rule — all degree and proportions — and, in fact, all that by which alone definition can be worked, or correct demonstration made, is omitted. As I have shown, the founder of the that he could not discover the first

science has declared

premiss of his subject and so, failing to lay a solid foundation, he has raised his building upon an unsound foundation.

The course which I shall have to pursue is that of showing the law of due degree or proportions, a course by which the free actor will have a just rule or law of advancement and progress, laid down and applied to his action. The new element and feature which I have to introduce within the

field of the science, is, then, the Law of Proportions- Definite Proportions.

Two immense issues are thus involved by the working of the antagonistic principles just referred to. The reader keeping constantly and steadily under his observation the object for which we all agree to argue, which is, the creation and distribution of the largest amount of value or capital, and marking well the character of the moral agency employed, as well as the material results educed, will have to observe, examine, compare, and consider deeply and comprehensively, and then to choose on which side he will enlist.

CHAP. IV.

The competitive principle of commerce examined. — It is shown to be adverse to the prosperity of nations, and destructive of the general interests of mankind.

HAVING shown, in the preceding chapters, that the true and solid foundation of a system of human commerce and association rests upon a principle of general and mutual co-operation, support, and trust, arising out of the fact that all things required for the maintenance or consumption of man are ordained to be procured by labour, and an exchange of the productions of labour, I now proceed to show that confliction of interests, or those courses of labour and of commerce that are especially embraced by the competitive principle, cannot be admitted without introducing injustice, or moral evil, and a derangement and diminution of stock or capital which entail physical evil.

In order to prove this, I will assume that the four parties already adduced have increased their number to ten, and the fruit of their labour, or their productions, to the number ten likewise; and that they are exchanging all these acquired commodities mutually and beneficially, upon the principle of united labour and exchange already explained. Thus, there will be ten families forming a community, and ten kinds of commodities forming their stock or capital, by means of which they are maintained.

The ten parties being in the state which I have now supposed, I will assume, also, that the members of the party D,

in search after their commodity fuel, discover that they can, in addition to the commodity fuel, procure also the commodity suited for building, and that, too, of a better and more enticing quality than is supplied by C; and, that they devote that portion of their labour which need not be directed to the procuring fuel, to the procuring the commodity adapted for building a habitation: so that, in a short space of time, they are enabled to procure this in addition to fuel, and which being thus in their possession they offer it in exchange.

Now, it is evident, that the state of things thus brought about is calculated to be, in the greatest degree, injurious to the interests of C, for if the facts of exchange be realised, it must happen as follows: A ceases to demand, that is, he rejects the commodity or building material supplied by C, transferring his demand to D, for the superior commodity supplied by him, and delivers in exchange the superabundant food which before was ordained as the share of C, and which was absolutely, and under compact, procured for the consumption of C; B pursues the same course as A, by rejecting the commodity of C, and withholding from him that which he had procured for him, and instead of giving it to him, gives it to D; the same occurs with E, and likewise with all the others. D, therefore, and those with him, will have doubled their acquisitions; but by so doing they will have consigned C, and those connected with him, to a state of destitution.

In thus tracing out the result of a wrong principle of production, and of demand likewise, I have inferred, that all the members of the community, with the exception of those forming the party C, have sustained no injury; that is, I have inferred, that the party D, the producers of the new commodity, have taken in exchange, or made a demand for, every portion of the various other commodities which have been withheld from the party C, or which they have been made

unable to demand; but, in a more advanced state of society, the effect of a transaction issuing from the same principle would be greatly extended, and the injury enhanced, as it would not be confined to those representing the party of C, but would be extended to many others, by reason of the demand for their commodities having become deranged or having ceased in a degree. The derangement, therefore, would be general, whereas I have now supposed it to be merely partial. I shall have opportunities of proving this hereafter, by more enlarged examples. I will do this, although I am aware, that to persons whose minds are able to deal with the consideration of principles, so as to comprehend their influence and operation, such exemplification would not be necessary.

Perhaps it may be said, in objection to the line of argument which I have now advanced, that the entire matter of nature being open and available, C may go back to his former state; and that he, and those comprising his family, can, by directing their labour to the producing another commodity, soon regain their lost advantage and station. It is evident, however, that such an argument in objection is futile.

The question, and the only question, is, whether such a state of things as that which I have adduced, be, as regards the community, a progressive or a retrogressive step. It has been admitted, that the tendency of population being towards a constant increase of its species, a constant increase of means, stock, or capital is required for sustaining it, and to be kept in advance of it. Here, then, C and his family are deprived of their means of support, and cast back into their original destitute condition, their labour having been employed and their time passed in procuring an article which they knew, by previous compact with others, to be in demand, and so to be valuable. Another commodity is sub