M.de Sismondi opposes a fact that occurred,in which a hundred thousand stocking-knitters with their needles,and a thousand workmen provided with frames,each manufactured ten thousand pair of stockings.The result was,that in the latter case the consumers of stockings only saved 50centimes per pair,and still a manufactory which used to employ a hundred thousand work-people,now only employed twelve hundred.But he only comes to this conclusion by suppositions which are not admissible.
To prove that consumers obtained the stockings only 50centimes less,he supposes that the cost of production would be,in the first case,as follows:
10millions,for the purchase of the material.
40millions,wages to a hundred thousand work-people,at 400francs each.
Total 50millions,40of which paid to the work-people.
And in the second ease,he supposes the cost as follows:
10millions,for the material.
30millions,for interest of fixed capital and enterpriser's profits.
2millions,for interest of circulating capital.
2millions,for repairs and new machines.
1million,wages of 1200workmen.
Total 45millions,of which 1is paid to the workmen instead of 40.
Now I see that this item of 30millions for interest of fixed capital,and enterpriser's profit,taken on the supposition of an enterprise capable of employing twelve hundred work-people,and of yielding 15per cent on their capitals,supposes a capital of two hundred millions,a supposition truly preposterous.
One workman cannot work at two frames at once,a thousand workmen would therefore require a thousand frames to be employed.A good stocking-frame costs 600francs,consequently the thousand would cost six hundred thousand francs;add to this capital,a like capital for the other utensils,work-shops,etc.still we should only have occasion for a.capital of twelve hundred thousand francs.We admit that the interest and the enterpriser's profit on the capital would be 15per cent,which is very moderate,for a current business which produced more would so on by competition be brought to this rate.Admitting this,we shall find for the interest and the enterpriser's profit,180thousand francs,instead of 30millions!
The same observation applies to the 2millions for expences of keeping and repairing the machines;for if,instead of repairing the frames,new ones were bought yearly,still they would only cost 600thousand francs.
Nor would the circulating capital cost 2millions,for in Mr.Sismondi's hypothesis,of what does it consist?Of the raw material,which he quotes at 10millions,and wages,which he calls 1million,together 11millions,the interest of which,at 5per cent,is 550thousand francs.But as in this business the production may be completed and sold within 6months,the capital paid for if the author has quoted the capital for the machines cost each time 275thousand francs,instead of 2millions.
All these expences together still only make 12,055,000francs,instead of 50millions,which stockings knit with the needle would cost,according to M.Sismondi.I am far from thinking that the saving could be so great,for if the author has quoted the capital for the machines too high,he has attributed too great a facility to them,in supposing that by their means twelve hundred workmen could do as much as a hundred thousand;but I say that if the saving in this production were so great,the low price of stockings or any other article of that nature would so favor the consumption,that instead of seeing the hundred thousand work-people,as is supposed,employed,we should probably see the number increase to two hundred thousand.
And if the consumption of this article in particular,.did not admit this excessive multiplication of the same production,the demand would increase in respect to many others;for observe,that after the introduction of machinery,the same revenue is still found in society,that is,the same number of workmen,the same amount .of capital,and the same portion of land.Now if,instead of devoting out of this mass of revenue 50millions yearly for stockings,it is only necessary,in consequence of the frames,to employ 12,the 38millions remaining may be applied to other consumptions,if not to the extension of this.
This is what principles teach,and experience confirms.The misery suffered by the population of England,and which M.Sismondi deplores with a truly philanthropic feeling,arises from other causes,principally from the poor laws,and,as I have hinted,from a weight of taxation which makes production too expensive;so much so,that when the articles are finished,a great part of the consumers do not get sufficient to obtain them,at the price that is obliged to be asked for them.
