Mrs. Ricardo and I are sorry that Mrs. Malthus will be prevented from
accompanying you when you pay us a visit at Gatcomb. We should have been
very happy to have shown her some of the beauties of our county. When
you come, perhaps you will bring your gun with you. Though I am no
sportsman myself, I will endeavour to procure you the best sport that my
influence can command.
I am very much obliged to you for the attention which you have given to
my MS.[115] I am fully aware of the deficiency in the style and
arrangement; those are faults which I shall never conquer. I will
however use my best endeavours to elevate it to the very low standard to
which you compare it[116]. It would be unpardonable to write worse with
more practice.
I expected that you would not quite agree with my plan of abolishing the
metals from circulation; but the grounds on which you object to it may I
think be answered, and then your objections would I hope be removed. You
fear that without a metallic circulation we could not on an emergency
supply a large sum of bullion for the exigencies of the State. The fact
is however against you, for we have supplied large sums when the metals
have been absolutely banished from circulation. This has been the case
during the whole Peninsular War. If indeed on my system the Bank could
keep a less quantity of bullion in their coffers to answer the demands
of the public, the objection would be well founded; but the only
difference would be that in one case their hoards would consist wholly
of coined gold and silver, and in the other they would consist of the
uncoined metals; but, on both systems, if the Bank paid their notes on
demand the currency must be equally reduced in quantity, if gold and
silver should become more valuable. That argument then may be used
against a currency convertible at all, into specie or bullion, but does
not apply to one more than the other. I think with you that on the whole
silver would be a better standard than gold, particularly if paper only
were used. All objections against its greater bulk would be removed.
I find I did misapprehend your illustration respecting profits from
Otaheite; but our difference is still very serious. I most distinctly
allow that any causes which tend to make capital less in demand will
lower profits; but I contend that there are no causes which will for any
length of time make capital less in demand, however abundant it may
become, but a comparatively high price of food and labour,--that profits
do not _necessarily_ fall with the increase of the quantity of capital,
because the demand for capital is infinite and [is] governed by the same
law as population itself. They are both checked by the rise in the price
of food and the consequent increase in the value of labour. If there
were no such rise, what could prevent population and capital from
increasing without limit? I acknowledge the effects of the great
principle of supply and demand in every instance; but in this it appears
to me that the demand will enlarge at the same rate as the supply if
there be no difficulty on the score of food and raw produce. Fertility
is, as you justly observe, the essence of high rents; and low rents are
the necessary result of barrenness however scarce corn may be. I agree
with you too that, in a country limited to 100,000 acres, all of the
richest conceivable quantity, yet peopled and capital'd up to the utmost
limits of its produce, the profits of stock and the wages of labour
would both be very low, although the quantity of produce yielded by a
given capital _including rent_ might be 100 per cent.; but I ask, if by
any miracle the produce of that land could at once be doubled, would
rents then continue as high as before, or could they possibly rise? We
are speaking of the immediate not the ultimate effects. The improvements
in skill and machinery may in 1000 years go to the landlord, but for 900
they will remain with the tenant.
Yours very truly,
DAVID RICARDO.
I have been so busy and am yet so busy that I cannot return to Gatcomb
till Friday.