Wealth

Wealth names a family of things that the great books seldom keep apart: riches and poverty, money and credit, property in land and goods, trade, and the getting, keeping and spending by which men live. It is a great idea for the Harvard Classics because no other part of human life is treated by so many kinds of writing. Scripture and the Stoics address it, and so do the epic hoard, the Arabian tale, the Scottish song and the fairy story. So do the colonial charter and the treaty, the moralist’s maxim, and the one systematic treatise in the collection, Adam Smith’s inquiry into the wealth of nations. The questions these texts raise run from the most private to the most public. Is wealth a good at all? How may it rightly be won and used? On what does property rest? What are money, price and capital? Is the distribution of riches just?

The first question is what wealth is. Smith answers with deliberate plainness. A nation’s wealth is the produce available to each consumer¹. A man’s real riches lie in what his money can purchase, not in the metal². Revenue consists in the power of buying consumable goods, so that a bill on a bankrupt is worth nothing³. Wealth gives command over labour, and Smith takes care to separate this from political power, against Hobbes⁴. Hobbes had held that riches are honourable because they are power, and poverty dishonourable⁵. He added that riches win friends and servants only when joined with liberality⁶. Smith’s sober measure lets him say that a frugal European peasant lives nearer to a prince than an African king lives to the peasant⁷. Older and humbler texts reach the same distinction by other routes. Aesop’s cock prefers a barley-corn to a pearl⁸. Drake’s Cimaroons value iron above gold out of necessity⁹. More’s Utopians make chamber-pots of gold so that losing it would cost nothing¹⁰.

Whether wealth so understood is a good divides the authors more deeply. The Stoics count it indifferent. For Epictetus the rich man is he who is content¹¹, and true riches are constancy and tranquillity¹². Marcus Aurelius thinks money wrongly held a good¹³. Long’s summary of their teaching is that wealth and poverty fall to good and bad alike¹⁴. Walton finds that wealth is seldom the portion of good people¹⁵. Christian and popular writers move from indifference to the claim that the truly rich man is rich in something else. Thomas à Kempis finds that whoever has Christ has enough¹⁶. Browne holds that he is rich who has enough to be charitable¹⁷. Burns sings that titles cannot buy peace¹⁸, and Emerson that true riches are a generous heart¹⁹. Bacon stands between the camps. Riches, he says, are the baggage of virtue, with no real use except in distribution²⁰.

Darker views make wealth a snare. Aeschylus’s chorus hears that excess of treasure breeds impiety²¹, yet it denies that wealth itself brings ill²². Sophocles’ Creon calls money the worst human evil, the destroyer of cities and corrupter of good minds²³. Luke’s Gospel declares that no one can serve God and mammon²⁴. It tells of the rich fool whose hoard is useless when his soul is required²⁵, and it sets the camel and the needle’s eye before the rich ruler²⁶. Dante calls papal avarice an idolatry a hundredfold worse than the heathen’s²⁷. More’s Hythloday thinks money the root of fraud, theft and murder²⁸, and Browne calls avarice a madness worse than any delusion²⁹. The moderns keep the charge alive. Penn’s money-monger is a slave to his servant gold³⁰. Woolman observes that increased wealth increases the desire for it³¹. Ruskin finds a whole nation ruled by love of money³². Legend gives the snare its plainest form in cursed treasure. Virgil’s Aeneas cries out against the hunger for gold that broke every bond³³. Andvari’s curse makes the Niblung gold the bane of each owner³⁴. Beowulf’s hoard costs the king his life³⁵, and Kasim dies in the robbers’ cave for riches³⁶. The miser is a quieter version of the same madness. Aesop’s neighbour remarks that the empty hole would serve as well as the buried gold³⁷. Ecclesiastes says the love of silver is never satisfied³⁸.

Behind these warnings lies the mortality of riches. The Psalmist says wealth cannot ransom a brother from death³⁹. A Buddhist text says grain and gold cannot follow a man⁴⁰. In the Arabian City of Brass, pits of gold could not lengthen a single life⁴¹, and merchants starved amid full markets⁴². Hamlet’s land-buyer keeps only the length of his indentures in the grave⁴³. Dante adds that Fortune’s goods are brief and vain⁴⁴, and Hamlet’s player that love tends on fortune⁴⁵.

Poverty receives an equally divided treatment. Its misery is drawn most fully by Manzoni, whose famine floods Milan with starving country families⁴⁶ and levels every rank⁴⁷. Grimm’s woodcutter cannot buy bread⁴⁸. Carlyle notes that nine-tenths of mankind still battle famine amid civilised prosperity⁴⁹. Several writers see want as a spur to crime. Confucius does⁵⁰. So does More, whose dismissed servants turn to theft⁵¹, and so does Franklin, who remarks that a man in want finds it hard to be honest⁵². Yet poverty is also honoured. Socrates’ poverty witnessed that he never took pay⁵³. Aristides gloried in his poverty and refused gifts⁵⁴. In Dante, Fabricius chose virtue with poverty over riches with vice⁵⁵, and Francis took Lady Poverty as his bride⁵⁶. Wherever money governs marriage, poverty becomes shame. Cordelia is prized by price and falls when dowerless⁵⁷, and Burns curses money’s power over love⁵⁸. The rich man who ignores Lazarus⁵⁹ has his echo in Lear’s pity for houseless poverty⁶⁰ and in Ruskin’s starved man beside a Parisian supper⁶¹.

How, then, may wealth be honestly gained? Franklin’s autobiography is the great witness for industry and frugality, which pay his debts and win him credit⁶². He also observes that money is prolific, the second hundred pounds coming easier than the first⁶³. Steele’s merchant holds that a penny saved is a penny got⁶⁴. Smith gives the maxim theoretical form. Capital grows by parsimony, not industry alone⁶⁵, so the frugal man founds a perpetual fund for productive labour while the prodigal impoverishes his country⁶⁶. Bacon’s rule is to get riches justly, use them soberly and distribute them cheerfully, and he warns that hasty enrichment is seldom innocent⁶⁷. Raleigh likewise allows honour and riches if they are not built on others’ ruin⁶⁸. Against these the spendthrift stands as a perennial type: the prodigal son⁶⁹, Nur-ed-Din scorning his steward’s warning⁷⁰, and Sheridan’s Charles auctioning his ancestors⁷¹.

The right use of wealth turns on the idea of stewardship. Penn insists that men are only stewards of their estates, accountable to God and the public⁷². Massinger’s Lady Allworth calls riches a good servant and a bad master⁷³. Manzoni’s Federigo treats church revenues as the patrimony of the poor⁷⁴. The command to give is nearly universal. Confucius would send surplus to neighbours⁷⁵. Paul says God loves a cheerful giver⁷⁶, and the Koran calls alms a loan to God⁷⁷. Manzoni’s Cardinal holds that anything not spent on bread in a famine is a kind of robbery⁷⁸, yet the novelist shows that even great charity could not meet the need⁷⁹. Lowell, later, calls charity merely palliative⁸⁰. Liberality has its heroic form in the gift-giving of epic^81,82. It has a civic form as well. Cellini says that princes who pension talent water the roots of genius⁸³, and Burke that public ornament consoles the poor⁸⁴. Smith, too, prizes durable expense, since palaces and collections come to adorn a whole nation⁸⁵.

The ideal of plain living runs from Woolman, who links luxury with evil⁸⁶, to Emerson, who asks why any man need be rich⁸⁷. Goldsmith and More turn the personal ideal into social criticism. In Goldsmith, where wealth accumulates, men decay⁸⁸. In More, money multiplies vain occupations for the idle rich⁸⁹.

Property raises the sharpest controversy. In Utopia itself Hythloday demands abolition of private property, and More replies that common ownership destroys abundance because no one is driven to work⁹⁰. The early Christians held all things in common⁹¹, and Don Quixote praises a golden age ignorant of “thine” and “mine”⁹². On the origin of the right, the authors part sharply. Hobbes says there is no property without law⁹³. Pascal sees in children’s “this dog is mine” the image of the usurpation of the earth⁹⁴, and calls inherited wealth a human institution, not a natural right⁹⁵. Rousseau traces civil society and its crimes to the first enclosure⁹⁶, though he grants that property arose from labour⁹⁷. Smith calls labour the original foundation of all property⁹⁸. Burke defends inherited property as the ballast of the commonwealth⁹⁹ and church estates as private property the state only guards¹⁰⁰. Emerson is double-minded. Property laws spring from selfishness¹⁰¹, yet property will be protected by necessity, since no farmer plants without hope of harvest¹⁰². Concentration is a recurring complaint. More’s sheep devour men¹⁰³. Harrison’s engrossers turn the commons into beggars¹⁰⁴. Emerson counts English landowners shrinking from 250,000 to 32,000¹⁰⁵.

Money, credit and interest are where analysis most visibly displaces moralizing. Smith traces money from barter’s inconvenience¹⁰⁶ to stamped coin certifying weight and fineness¹⁰⁷. Darwin watches Fuegians at barter¹⁰⁸. Paper money divides the moderns. Franklin pleads for more of it to quicken trade¹⁰⁹. Smith holds that paper frees capital for industry¹¹⁰ but that its circulation cannot exceed the metal it replaces¹¹¹. Burke sees in the French assignats a device giving speculators power over every man’s property¹¹², and contrasts them with English bank-paper convertible on demand¹¹³. Usury shows the change from ancient to modern most clearly. The Psalmist’s upright man takes no interest¹¹⁴. Dante ranks usury an offence against divine goodness¹¹⁵, and Luther wonders how money can breed money¹¹⁶. Bacon, however, holds that usury must be permitted because borrowing is necessary¹¹⁷, and proposes a general rate of five per cent¹¹⁸. Smith treats a loan as a transfer of goods, not money¹¹⁹. In his view the law should fix a moderate rate so that capital goes to sober borrowers¹²⁰.

Smith’s theory of value supplies the vocabulary for much of this. He distinguishes value in use from value in exchange, water from diamonds¹²¹, and makes labour the real measure of value and money only the nominal one¹²². Hobbes, by contrast, measures value by the appetite of the contractors¹²³. Market price, for Smith, gravitates toward natural price¹²⁴. Wages rise with the growth of wealth rather than its size¹²⁵, and no society flourishes when most of its members are poor¹²⁶. Mill adds a distinction of his own: the laws of production are natural, while distribution depends on human will¹²⁷. Famine tests these theories. Harrison would search barns to stop hoarding¹²⁸. Smith thinks regulation such as the assize of bread inferior to competition¹²⁹. Manzoni’s Ferrer fixes the price of bread below the cost of corn¹³⁰, and the novelist comments that decrees cannot create grain¹³¹.

On trade Smith’s case is the most sustained argument in the collection. Men are fed by the butcher’s self-interest, not his benevolence¹³². Wealth consists in what money buys, which refutes the mercantile identification of wealth with bullion¹³³. Each man seeking his own gain is led by an invisible hand to serve society¹³⁴, and consumption is the sole end of production¹³⁵. Yet Smith thinks free trade in Britain as unlikely as Utopia¹³⁶. Mill later states the free-trade doctrine as settled¹³⁷. Harrison, earlier, laments English cloth finished abroad¹³⁸, closer in spirit to the protective policies Smith attacks. Whether commerce civilizes is left open. Voltaire praises it for making a small island powerful¹³⁹ and men of all faiths partners¹⁴⁰. Burke thinks it grew under the shade of ancient manners¹⁴¹. Against these, Bunyan’s Vanity Fair sells even souls¹⁴². Emerson calls trade a system of selfishness¹⁴³, and Tennyson denounces chalk and alum sold to the poor¹⁴⁴. The colonial voyages show the old error in action. Raleigh promises Guiana gold beyond Peru¹⁴⁵ and traces Spain’s power to Indian gold¹⁴⁶. Smith replies that Columbus pinned the islands’ value on gold¹⁴⁷, but that America really enriched Europe by opening a market¹⁴⁸.

The state’s dealings with wealth form the last field. Confucius makes the ruler’s plenty depend on the people’s¹⁴⁹. More says a king’s safety rests on his subjects’ wealth¹⁵⁰, and Machiavelli warns princes against confiscation¹⁵¹. Smith lays down canons of convenient and economical taxation¹⁵², and denies that public debt adds to a nation’s capital¹⁵³. Washington urges that public credit be cherished¹⁵⁴, and Burke calls the revenue the state itself¹⁵⁵. Riches may also buy power. In Plutarch money grew master of Rome’s elections¹⁵⁶. Mill finds riches almost the only source of political importance in England¹⁵⁷. Luther’s attack on indulgences as nets for men’s riches¹⁵⁸ shows the same corruption in the Church.

The question of justice remains open. Confucius traces unrest to unequal shares rather than to poverty¹⁵⁹. Lear sees that gold plates sin¹⁶⁰. Gloucester wishes distribution to undo excess¹⁶¹, and Milton’s Lady argues that if the few did not heap excess, every just man would have his share¹⁶². Mill comes to condemn the injustice of some being born rich and most poor¹⁶³. Channing asks whether England’s riches benefit the many¹⁶⁴, and insists that prosperity confers no superiority¹⁶⁵. Yet Ruskin doubts that limiting incomes would work¹⁶⁶. Lowell would give labour a larger share while fearing that state socialism would destroy self-help¹⁶⁷. Across the collection the moral question of riches is never displaced by the economic one. Smith explains how wealth increases. The older and younger moralists continue to ask what it is for and to whom it belongs.