The following Letters are printed for the first time from the original
manuscripts, kindly lent for the purpose by Colonel Malthus, C.B. The
representatives of Ricardo have been good enough to make search for the
corresponding letters of Malthus, but without success.
The Collection covers the whole period of the friendship of the two men.
What is of purely private interest (a very small portion) has, as a
rule, been omitted. There is seldom any obscurity in the text; the
handwriting of Ricardo is clear and good. The earlier letters have no
envelopes. The breaking of the seal has frequently torn a page, and
destroyed a word or two. In two cases we have nothing but the fragment
of a letter. But fortunately the bulk of the series has reached us in a
complete state.
These Letters were evidently known to Empson and MacCulloch, whose
references to them are quoted in their proper place. Other letters of
Ricardo, as well as his speeches in Parliament, are quoted here and
there when they illustrate the text or fill up a gap. The Correspondence
with J. B. Say is given at some length, as it is probably little known
to English readers.
The Outline of Subjects will be found to contain only a bare sketch of
the main positions taken up by Ricardo against Malthus in these Letters.
It could not fairly be expanded into an account of both sides of the
argument, for, when we are within hearing of only one of the disputants,
we cannot with fairness believe ourselves to have the whole case before
us. We cannot accept his statement of the terms of the discussion, for,
though he had every desire to be just to his opponent, his cast of mind
was so different that he can hardly be thought to have entered into his
opponent's views with perfect sympathy[1].
These Letters indeed show on almost every page how completely the two
economists differed in their point of view. Beginning in a deep mutual
respect, their acquaintance with each other grew into a very close
intimacy; but it was the friendship of two men entirely unlike in mental
character. Ricardo admits that he had been deeply impressed by the Essay
on Population (p. 107), but thinks that Malthus is apt to miss the true
subject of political economy, the inquiry into the distribution of
wealth, and to confine himself to production, of which nothing can be
made (pp. 111, 175); Malthus seems to his friend to have too strong a
practical bias (p. 96); instead of reflecting on the general principles
that determine (for example) the Foreign Exchanges, he tries to get
light from Jamaica merchants and City bullion dealers (p. 3, cf. 12); he
buries himself in temporary causes and effects instead of looking to
permanent ones (p. 127); he gains his point by a definition instead of
an argument (p. 237) and, perhaps through the same practical bias, he is
too much absorbed in questions of his own College (p. 125), and not
eager enough for political reform (pp. 151, 152). Malthus, Cambridge
Wrangler and Haileybury Professor, was free from any academical bias in
favour of abstract thinking; he had in fact little of the typical
University man except his love of boating (p. 158). Ricardo, a self-made
and largely a self-educated man[2] (though he had neither the pride of
the first nor the vanity of the second), had no traditions that were not
mercantile, and made a large fortune on the Stock Exchange[3]. But, in
his thinking, he was under no slavery to details; he was even conscious
of a strong theoretical bias (p. 96). He was fonder of 'imagining strong
cases' to elucidate a principle, than of adducing actual incidents to
establish it (pp. 164, 167). The very narrowness of his programme
enabled him (as later it enabled Cobden and his school) to seem to
exhaust all the difficulties of the subject, and dispose of them by
plain straightforward proofs. Malthus, who had a less acute logical
understanding, but saw more clearly the real breadth and complexity of
the subject, seemed often more faltering, and less consistent with
himself.
Ricardo agreed with his friend in looking, on the whole, at the bright
side of things, and forecasting prosperity for England even in the dark
days of Luddites and Six Acts (pp. 139, 141). They were, both of them,
unready writers, partly from deference to each other's criticism (pp.
20, 23, 117, 125, 155, 159, 207),--partly, in Ricardo's case, from
awkwardness in composition, where he was always, in his own opinion, the
worse man of the two (pp. 104, 108, 145, 208),--partly because the
obscurity of the subject was felt by them to be inconsistent with
dogmatic certainty (pp. 111, 176, 181). But they are free in their
criticism; they never dream of allowing it to affect their good temper
(pp. 175, 240), and they are never afraid to confess mistakes (pp. 20,
184, 207, 231, etc.).
Personally, they agreed in enjoying society and travel, in loving 'law
and order' and hating 'a row' (pp. 64, 208), and in being nowhere so
happy as in their family circle, in Ricardo's case a patriarchally large
one (p. 146). The robust health of Malthus was not shared by his friend
(p. 140), but the latter had more of the qualities of a public man, and
in the House of Commons he was by no means a silent member. Their range
of interests was perhaps equally wide, though Ricardo's bent was to
natural science as Malthus' to mathematics. In politics they were both
in favour of Parliamentary Reform. Francis Place[4], writing in 1832 to
a correspondent who had reproached Political Economists with hostility
to reform, says that the study tends almost necessarily to political
enlightenment, and points to Malthus, Mill, Ricardo, and others in
confirmation. 'Mr. Malthus' (he says) 'was an aristocratic parson when
he first published his Essay on Population ... but in going on with his
work and being obliged to study political economy, his prejudices gave
way before principles, and he became the advocate so far as he dared of
good government. His work contains irrefragable arguments for universal
suffrage, which cannot be overlooked, but must be applied by every
reader who understands the subject; and there are also in his work other
indications of what you and I should call liberal principles[5].' For
myself, Place adds, I have been 'a plain Republican for forty years;'
James Mill is 'as bad as myself.' As to Ricardo: 'He was one of the most
enlightened of reformers I ever knew; he was a man who never concealed
his opinions.' There is no doubt, from all the evidence, what these
opinions were. Ricardo advocated a widely extended suffrage, frequent
parliaments, and especially secret voting. In his speeches in the House
of Commons, which are more than a hundred in number, from the first on
the 25th March, 1819, to the last on the 4th July, 1823, he speaks his
mind plainly not only on the Bank, the Sinking Fund, the currency,
agriculture, the Poor Law, and the tariff, but on the reform of
Parliament, retrenchment, freedom of the press and right of public
meeting. His oratory seems in many respects to have resembled that of
Cobden. The arguments were given with plain directness without elegance
of diction; and they were brought home by matter-of-fact similes from
every-day life or commercial experience. We know from Brougham that his
manner of speaking was earnest, modest, genial, frank, and unaffected;
and, as he only spoke on what he knew, he was always heard with
attention[6], though his sentiments were unpalatable and he was usually
in a hopeless minority.
Bentham claimed to be the spiritual grandfather of Ricardo[7], and
Ricardo may have got his first thoughts on Politics from him and Mill,
as on Economics from Adam Smith; he may also have caught from Bentham
his habit of reasoning abstractly. But the arguments he uses on behalf
of his political opinions are such as to leave the impression that he
reached his politics through his political economy, the former being
only the latter from a different point of view. He seems to construct
his notion of a free government on the lines of his notion of a free
trade. When he takes the unpopular side in the case of the Carliles[8],
imprisoned for blasphemous libel, he is not unfairly described by
Wilberforce as simply 'carrying into more weighty matters those
principles of free trade which he has so successfully expounded' in
other cases. His interest in popular education seems to spring from the
desire that our people may be rightly equipped for industrial
competition. He attends a City dinner to the Spanish Minister at a time
when the European Powers are threatening Spain, and appeals to the
principle of Non-Intervention[9], thus anticipating the Manchester
School and applying _laissez faire_ on the large scale. He applies the
same principles perhaps too abstractly in the case of the Spitalfield
Acts[10], which made the wages of the silkweavers to be fixed by the
Justices instead of by the 'higgling of the market,' and in the case of
the Truck System[11], or payment of wages in kind; but there was much to
justify his hostility to the first, and there was Robert Owen's
successful use of something very like the Truck system in New Lanark to
excuse his defence of the second. He had a statesman's willingness to
accept part where he could not get the whole, and to welcome a
compromise rather than no progress at all. He would not abolish the Corn
Laws at a stroke, but would prepare our agriculturists for the change by
lessening the duty on imports year by year till nothing was left but
10_s._ a quarter, to remain as a 'countervailing duty' roughly equal in
amount to the peculiar burdens of the British agriculturist[12]. Some of
his opponents called him a 'mere theorist'; but this is a common taunt
of men who cannot render a reason against men who can. Even his disciple
MacCulloch thinks that his investigations were 'too abstract to be of
much practical utility[13].' But in his own hands they were not so
abstract that they were divorced from practice, or unmodified by the
needs of each case. Such measures as he recommended in the House were of
great practical utility, and have nearly all been embodied in subsequent
legislation; yet he founded them all on certain general principles which
in the order of his thinking were economical first and political
afterwards. As far as politics are concerned, we find the principles
abstract simply because they are not in our own day the principles most
needed in legislation.
In short, Ricardo's thinking was abstract only in the sense in which
Bentham's was so. They had arrived, by a different road, at the same
political philosophy. Ricardo had a fixed idea of the individual as
being logically prior to society; and the interest of the community only
meant to him the interest of a large number of individuals, the
collection as a whole having no qualities not possessed by each of the
parts, and there being no spiritual bond. Nature (which means in this
case theory instead of history) begins and ends with individuals; Nature
made the individuals, and Man made the groups. Ricardo agreed with
Bentham that 'the community is a fictitious Body, composed of individual
persons who are considered as constituting, as it were, its Members. The
interest of the community then is what? The sum of the interests of the
several members who compose it[14].' We find Ricardo arguing: 'Let me
know what the state of men's interests is, and I will tell you what
measures they will recommend;' and 'that State is most perfect in which
all sanctions concur to make it the interest of all men to be virtuous,'
in other words, to promote the general happiness[15]. Now, to consider
human beings as first and chiefly separate from one another and having a
separate self-interest which rules their action, is certainly to reason
abstractly. But this abstract reasoning of the Philosophical Radicals is
due, in the case of the Economists among them, more to Adam Smith than
to Bentham. Most of them, like Ricardo, had got not only their first
economics but their first lessons in thinking, from the 'Wealth of
Nations.' The 'Wealth of Nations' bore the stamp of that Individualism
which we usually associate with Rousseau. Its author had written,
seventeen years before, a book in which he gave almost exclusive
consideration to the common bond that unites man to man, the power one
man has of putting himself by thought in the place of another, or (in a
wide sense of the word) to sympathy. There is no need to suppose that
Adam Smith had forgotten or recanted the 'Moral Sentiments;' but it is
certainly the case that in the later and greater work, which became the
text-book of Political Economy, he deliberately takes up another point
of view, and presents men as dominated by private interest. With every
allowance for his frequent qualifications ('upon the whole,' 'in many
respects,' etc.), there is no doubt that he there considers 'the natural
effort which every man is continually making to better his own
condition' as a principle of growth and health which owes little or
nothing to State or Society, but is continually transforming them and
bringing good out of their evil. He is fully aware how industry in all
its forms has been affected by the government and civilization of a
people; but he regards industry itself, or the commercial ambition of
the industrious classes, as more potent still. As far as industrial
progress is concerned, he would have said with Bentham that Nature
begins and ends with individuals; in matters of trade he has no
confidence in associations of men, even when they are voluntary. To
him, the really beneficent association is that unintended and
unpreventible organization resulting from the division of labour, the
separation of trades, and the uncontrolled movements of commercial
ambition on the part of individual men. He is careful to say that
Political Economy is not Politics[16]; but he insists that all political
restraints and preferences must be taken away from industry, and 'the
obvious and simple system of natural liberty' will 'establish itself of
its own accord.' It is not surprising that this lesson in individualism
was learned by his successors without the cautions with which the
teacher would have surrounded it. The pupils unconsciously argued as if
political individualism was part and parcel of economical principles,
for it certainly seemed so in the one book of their teacher that they
had been led to study; and, when Bentham made self-interest a leading
principle of politics, Ricardo, to follow him, needed only to make clear
to himself the underlying political basis of his economical ideas. In
Malthus, economical individualism is held in check by a strong devotion
to the principle of nationality, as well as by a wide range of
philosophical and general interests. But to Ricardo political economy is
all in all; the ruling principles of all his thinking are determined for
him by the economical; and the result is individualism in politics as
well as in political economy. The animosity of his critics is perhaps as
often due to their strong dislike of this political philosophy
underlying his doctrines, and derived through Adam Smith from Rousseau,
as to any real or supposed abstractness of the doctrines themselves.
Ricardo's political work has therefore the merits and the defects of the
theory of individualism and policy of _laissez faire_, which crowned its
achievements with the Repeal of the Corn Laws and Navigation Acts. John
Stuart Mill, who was bred an individualist, has left us in his writings
a faithful reflection of the change which has passed over English
politics and English economics in the course of his lifetime, and which
he himself welcomed with some misgivings. We have ceased to believe that
the removal of obstacles is enough to secure the highest good either in
government or in industry. But we must not deny that the Manchester
School and its predecessors were indispensable in their own day.
It is sometimes said that in addition to the faults of his school,
Ricardo had flaws of his own which were due to a certain strong bias of
self-interest[17]. We might answer that his arguments must none the less
stand or fall by their own logic. But there is no reason to suppose any
bias in Ricardo except his peculiar character of mind and cast of
thought. He had the intellectual interest of a reasonable man in getting
the right instead of the wrong answer to a difficult question; and his
selfish interest as a member of the 'propertied' classes was not clear
enough to be a snare to him. 'It would puzzle a good accountant' (he
says in the House[18]) 'to make out on which side my interest
predominated; I should find it difficult myself from the different kinds
of property which I possess (no part funded property) to determine the
question.' He could be chivalrous and even Quixotic on occasion. His
best political friends[19] thought he was Quixotic when he proposed to
levy a high property tax to pay off the National Debt: 'I should
contribute any portion of my own property for the attainment of this
great end if others would do the same[20].' There was chivalry in his
praise of Cobbett's Letter to the Luddites[21]; Cobbett had given him
abuse unmixed with any drop of generosity. We may therefore look in vain
in Ricardo for any feeling of antipathy to landlords or any other body
of men, though he spoke, as in duty bound, against landlords, bank
directors, and all classes of monopolists, whenever they stood in the
way of urgent reforms. Like other men, he not improbably had a lurking
partiality for what had been the main business of his working life. But
in his writings and speeches he gives us not feelings but arguments, and
arguments that cannot be dismissed as feelings in disguise.
In the purely economical works there is more of abstract theory than the
author is ever fully aware. Not only did he as an individualist
habitually regard men as separate competing atoms, and the desire of
wealth as the permanent and dominant motive of men[22]; but he made his
general statements too absolute. He sometimes guarded himself by saying
(as he does in these Letters): What I am laying down is true over any
considerable period of time; the causes to which I point are permanent;
I allow that other causes may prevail for short intervals; temporary
causes may seem to overrule the permanent ones; but I look to the final
settlement. Nevertheless, he admitted more than once in the course of
his career that he had stated the permanent causes too absolutely. The
doctrine of Value is first presented by him as extremely simple,--the
value of a thing depends on the labour employed in producing it. Then,
as we go on, we find this is only true of 'the early stages of society
before much machinery or durable capital is used,' while it is not meant
to be true, even there, of objects that have a 'fancy' value, due purely
to their scarcity. Next, we are told that in modern times the relative
value of two things is affected by the proportions in which fixed
capital and circulating enter into their production; if fixed capital
enters more into one than into another, then a rise of wages will lower
the value of the first, for it will lower the rate of profits, and, as
there are more profits concerned in the first, the value of this first
will fall in relation to the other. This is not all;--if two things are
produced with a like amount of fixed capital, yet, if the durability of
the capital is different, there will be more labour where there is less
durability, and more profits where there is more durability; the things
produced by the more durable fixed capital will be lowered in value by a
rise in wages, which lowers the rate of profit; and so on, _mutatis
mutandis_. In short, value is affected not only by labour, but by the
wages of labour. To these concessions we may add the important change of
view, which (as we know from these Letters) made MacCulloch tremble for
the Ark of his Covenant[23]; we had heard nothing at first but the
praise of machinery as lowering prices and increasing the general
wealth; now we are reminded that the invention of it may for the time
cause serious injury to the working classes[24].
It is not difficult for men living two generations after Ricardo, and
having (as he himself expressed it[25]) 'all the wisdom of their
ancestors and a little more into the bargain,' to point out many
unjustified assumptions, many ambiguous terms, and even many wavering
utterances, in Ricardo's 'Principles,' in spite of their appearance of
severe logic. The author's detached practical pamphlets were in those
respects far more powerful than this volume of imperfectly connected
essays on general theory. The flattering importunities of friends had
induced an unsystematic writer to attempt a systematic treatise[26]. The
cardinal doctrine, that of Value, is applied to only one class of cases,
and, even to that, with serious modifications. It was left for later
economists, like Jevons in this country, and Menger and Boehm Bawerk in
Germany, to take up the task of giving a theory of value that will
embrace all cases of it, not excluding those objects that possess a
value 'wholly independent of the quantity of labour originally necessary
to produce them, and varying with the varying wealth and inclinations of
those who are desirous to possess them[27].'
Malthus has left a clear statement of the points at issue between
Ricardo and himself in the Quarterly Review for January, 1824. He
contended against Ricardo that (1) Quantity of Labour is not the chief
cause of Value, but (2) 'Supply and Demand' are more truly so described,
while (3) Competition of Capital, and not fertility of the soil,
determines the rate of profits. But, in regard to the first, he hardly
gives Ricardo sufficient credit for his large concessions. In regard to
the second, he does not realize that supply and demand are vague terms
which can only be made definite by a theory of value itself. In regard
to the third position, if fertility of soil be translated productiveness
of the staple industry, Ricardo's view seems nearer the truth than his
own. The inadequacy of the whole discussion on this third head is
largely due to the fact that economists had not then been pushed by
Socialism into a thorough investigation of Profits and Interest. They
were content to borrow these ideas from every-day commercial life, and
treat them as given ultimate facts needing no explanation. They
therefore never fully accomplished the very first task of Political
Economy, to state the facts as they are, and analyse into its
fundamental laws the existing industrial system of modern nations. Still
less did they fulfil its second task, to estimate the relation of the
industrial system to the larger social and political body in which it
lives and moves and has its being. The peculiar wants and motives of an
individual people, changing, as they do, with the growth of
civilization, must be viewed in their effects upon the production and
distribution of the national wealth, if the truth about the latter is to
be fully known. It is because the older economists did not attempt this
that their discussions, carried on even by their most eminent
representative men, seem to later readers superficial and unreal. But in
their Economics, as in their Politics, they had their own work and not
ours to do; and we must not blame them for not answering questions that
have only very recently occurred to ourselves.