The following pages contain, I believe, the first accurate analysis of the laws of Political Economy which has been published in England. Many treatises, within their scope, correct, have appeared in contradiction of the views popularly received; but no exhaustive examination of the subject was possible to any person unacquainted with the value of the products of the highest industries, commonly called the “Fine Arts;” and no one acquainted with the nature of those industries has, so far as I know, attempted, or even approached, the task.

So that, to the date (1863) when these Essays were published, not only the chief conditions of the production of wealth had remained unstated, but the nature of wealth itself had never been defined. “Every one has a notion, sufficiently correct for common purposes, of what is meant by wealth,” wrote Mr. Mill, in the outset of his treatise; and contentedly proceeded, as if a chemist should proceed to investigate the laws of chemistry without endeavouring to ascertain the nature of fire or water, because every one had a notion of them, “sufficiently correct for common purposes.”

But even that apparently indisputable statement was untrue. There is not one person in ten thousand who has a notion sufficiently correct, even for the commonest purposes, of “what is meant” by wealth; still less of what wealth everlastingly is, whether we mean it or not; which it is the business of every student of economy to ascertain. We, indeed, know (either by experience or in imagination) what it is to be able to provide ourselves with luxurious food, and handsome clothes; and if Mr. Mill had thought that wealth consisted only in these, or in the means of obtaining these, it would have been easy for him to have so defined it with perfect scientific accuracy. But he knew better: he knew that some kinds of wealth consisted in the possession, or power of obtaining, other things than these; but, having, in the studies of his life, no clue to the principles of essential value, he was compelled to take public opinion as the ground of his science; and the public, of course, willingly accepted the notion of a science founded on their opinions.

I had, on the contrary, a singular advantage, not only in the greater extent of the field of investigation opened to me by my daily pursuits, but in the severity of some lessons I accidentally received in the course of them.

When, in the winter of 1851, I was collecting materials for my work on Venetian architecture, three of the pictures of Tintoret on the roof of the School of St. Roch were hanging down in ragged fragments, mixed with lath and plaster, round the apertures made by the fall of three Austrian heavy shot. The city of Venice was not, it appeared, rich enough to repair the damage that winter; and buckets were set on the floor of the upper room of the school to catch the rain, which not only fell directly through the shot holes, but found its way, owing to the generally pervious state of the roof, through many of the canvases of Tintoret’s in other parts of the ceiling.

It was a lesson to me, as I have just said, no less direct than severe; for I knew already at that time (though I have not ventured to assert, until recently at Oxford,) that the pictures of Tintoret in Venice were accurately the most precious articles of wealth in Europe, being the best existing productions of human industry. Now at the time that three of them were thus fluttering in moist rags from the roof they had adorned, the shops of the Rue Rivoli at Paris were, in obedience to a steadily-increasing public Demand, beginning to show a steadily-increasing Supply of elaborately-finished and coloured lithographs, representing the modern dances of delight, among which the cancan has since taken a distinguished place.

The labour employed on the stone of one of these lithographs is very much more than Tintoret was in the habit of giving to a picture of average size. Considering labour as the origin of value, therefore, the stone so highly wrought would be of greater value than the picture; and since also it is capable of producing a large number of immediately saleable or exchangeable impressions, for which the “demand” is constant, the city of Paris naturally supposed itself, and on all hitherto believed or stated principles of political economy, was, infinitely richer in the possession of a large number of these lithographic stones, (not to speak of countless oil pictures and marble carvings of similar character), than Venice in the possession of those rags of mildewed canvas, flaunting in the south wind and its salt rain. And, accordingly, Paris provided (without thought of the expense) lofty arcades of shops, and rich recesses of innumerable private apartments, for the protection of these better treasures of hers from the weather.

Yet, all the while, Paris was not the richer for these possessions. Intrinsically, the delightful lithographs were not wealth, but polar contraries of wealth. She was, by the exact quantity of labour she had given to produce these, sunk below, instead of above, absolute Poverty. They not only were false Riches — they were true Debt, which had to be paid at last — and the present aspect of the Rue Rivoli shows in what manner.

And the faded stains of the Venetian ceiling, all the while, were absolute and inestimable wealth. Useless to their possessors as forgotten treasure in a buried city, they had in them, nevertheless, the intrinsic and eternal nature of wealth; and Venice, still possessing the ruins of them, was a rich city; only, the Venetians had not a notion sufficiently correct even for the very common purpose of inducing them to put slates on a roof, of what was “meant by wealth.”

The vulgar economist would reply that his science had nothing to do with the qualities of pictures, but with their exchange-value only; and that his business was, exclusively, to consider whether the remains of Tintoret were worth as many ten-and-sixpences as the impressions which might be taken from the lithographic stones.

But he would not venture, without reserve, to make such an answer, if the example be taken in horses, instead of pictures. The most dull economist would perceive, and admit, that a gentleman who had a fine stud of horses was absolutely richer than one who had only ill-bred and broken-winded ones. He would instinctively feel, though his pseudo-science had never taught him, that the price paid for the animals, in either case, did not alter the fact of their worth: that the good horse, though it might have been bought by chance for a few guineas, was not therefore less valuable, nor the owner of the galled jade any the richer, because he had given a hundred for it.

So that the economist, in saying that his science takes no account of the qualities of pictures, merely signifies that he cannot conceive of any quality of essential badness or goodness existing in pictures; and that he is incapable of investigating the laws of wealth in such articles. Which is the fact. But, being incapable of defining intrinsic value in pictures, it follows that he must be equally helpless to define the nature of intrinsic value in painted glass, or in painted pottery, or in patterned stuffs, or in any other national produce requiring true human ingenuity. Nay, though capable of conceiving the idea of intrinsic value with respect to beasts of burden, no economist has endeavoured to state the general principles of National Economy, even with regard to the horse or the ass. And, in fine, the modern political economists have been, without exception, incapable of apprehending the nature of intrinsic value at all.

And the first specialty of the following treatise consists in its giving at the outset, and maintaining as the foundation of all subsequent reasoning, a definition of Intrinsic Value, and Intrinsic Contrary-of-Value; the negative power having been left by former writers entirely out of account, and the positive power left entirely undefined.

But, secondly: the modern economist, ignoring intrinsic value, and accepting the popular estimate of things as the only ground of his science, has imagined himself to have ascertained the constant laws regulating the relation of this popular demand to its supply; or, at least, to have proved that demand and supply were connected by heavenly balance, over which human foresight had no power. I chanced, by singular coincidence, lately to see this theory of the law of demand and supply brought to as sharp practical issue in another great siege, as I had seen the theories of intrinsic value brought, in the siege of Venice.

I had the honour of being on the committee under the presidentship of the Lord Mayor of London, for the victualling of Paris after her surrender. It became, at one period of our sittings, a question of vital importance at what moment the law of demand and supply would come into operation, and what the operation of it would exactly be: the demand, on this occasion, being very urgent indeed; that of several millions of people within a few hours of utter starvation, for any kind of food whatsoever. Nevertheless, it was admitted, in the course of debate, to be probable that the divine principle of demand and supply might find itself at the eleventh hour, and some minutes over, in want of carts and horses; and we ventured so far to interfere with the divine principle as to provide carts and horses, with haste which proved, happily, in time for the need; but not a moment in advance of it. It was farther recognized by the committee that the divine principle of demand and supply would commence its operations by charging the poor of Paris twelve-pence for a penny’s worth of whatever they wanted; and would end its operations by offering them twelve-pence worth for a penny, of whatever they didn’t want. Whereupon it was concluded by the committee that the tiny knot, on this special occasion, was scarcely ”dignus vindice,” by the divine principle of demand and supply: and that we would venture, for once, in a profane manner, to provide for the poor of Paris what they wanted, when they wanted it. Which, to the value of the sums entrusted to us, it will be remembered we succeeded in doing.

But the fact is that the so-called “law,” which was felt to be false in this case of extreme exigence, is alike false in cases of less exigence. It is false always, and everywhere. Nay to such an extent is its existence imaginary, that the vulgar economists are not even agreed in their account of it; for some of them mean by it, only that prices are regulated by the relation between demand and supply, which is partly true; and others mean that the relation itself is one with the process of which it is unwise to interfere; a statement which is not only, as in the above instance, untrue; but accurately the reverse of the truth: for all wise economy, political or domestic, consists in the resolved maintenance of a given relation between supply and demand, other than the instinctive, or (directly) natural, one.

Similarly, vulgar political economy asserts for a “law” that wages are determined by competition.

Now I pay my servants exactly what wages I think necessary to make them comfortable. The sum is not determined at all by competition; but sometimes by my notions of their comfort and deserving, and sometimes by theirs. If I were to become penniless to-morrow, several of them would certainly still serve me for nothing.

In both the real and supposed cases the so-called “law” of vulgar political economy is absolutely set at defiance. But I cannot set the law of gravitation at defiance, nor determine that in my house I will not allow ice to melt, when the temperature is above thirty-two degrees. A true law outside of my house, will remain a true one inside of it. It is not, therefore, a law of Nature that wages are determined by competition. Still less is it a law of State, or we should not now be disputing about it publicly, to the loss of many millions of pounds to the country. The fact which vulgar economists have been weak enough to imagine a law, is only that, for the last twenty years a number of very senseless persons have attempted to determine wages in that manner; and have, in a measure, succeeded in occasionally doing so.

Both in definition of the elements of wealth, and in statement of the laws which govern its distribution, modern political economy has been thus absolutely incompetent, or absolutely false. And the following treatise is not, as it has been asserted with dull pertinacity, an endeavour to put sentiment in the place of science; but it contains the exposure of what insolently pretended to be a science; and the definition, hitherto unassailed — and I do not fear to assert, unassailable — of the material elements with which political economy has to deal, and the moral principles in which it consists; being not itself a science, but “a system of conduct founded on the sciences, and impossible, except under certain conditions of moral culture.” Which is only to say, that industry, frugality, and discretion, the three foundations of economy, are moral qualities, and cannot be attained without moral discipline: a flat truism, the reader may think, thus stated, yet a truism which is denied both vociferously, and in all endeavour, by the entire populace of Europe; who are at present hopeful of obtaining wealth by tricks of trade, without industry; who, possessing wealth, have lost in the use of it even the conception — how much more the habit? — of frugality; and who, in the choice of the elements of wealth, cannot so much as lose — since they have never hitherto at any time possessed — the faculty of discretion.

Now if the teachers of the pseudo-science of economy had ventured to state distinctly even the poor conclusions they had reached on the subjects respecting which it is most dangerous for a populace to be indiscreet, they would have soon found, by the use made of them, which were true, and which false.

But on main and vital questions, no political economist has hitherto ventured to state one guiding principle. I will instance three subjects of universal importance. National Dress. National Rent. Nat............