great evil, and one now more than ever likely to be productive of other evils spreading out beyond our immediate view. The object, therefore, whether of landlord or statesman, should now be, not to get conveniently rid of these backward agriculturists, but to see how their prejudices can be overcome - how their rude and imperfect system can be improved-and, above all, helpless and poverty-stricken as so many are by repeated losses, to see whether their greatest want can be supplied-the want of CAPITAL.

Note upon Agricultural Labourers.

A question even more important than that respecting the condition of the farmers-namely, the question respecting the condition of the agricultural labourersis too large to be entered into here; but the policy which would be good for the farmers, would also be good for the other more numerous, and therefore more important, portion of the rural population, by increasing the demand for labour. The evidence appears to be decisive that the labourers have gained greatly by free trade in corn, and the breathing time thus given may be invaluable if it be rightly used. But it will be a fatal mistake to suppose that free trade can either make or keep that condition what it ought to be. Their dwellings, their education, and their want of amusements are all disgraceful, and in no one of these respects are they able to help themselves. My belief, founded on information drawn from various sources, is, that the dark and appalling picture of the condition of the peasantry, which is given by the author of " Yeast," is in the main true, and I honour that powerful writer for not fearing to speak out. His delineation, terrible as it is, is indeed not more so than the plain facts stated from time to time by the Rev. S. G. Osborne, another true champion of those whose friends are few, and the testimonies of such men ought to sound like a trumpet in the ears of the English gentry, and awaken them to the fact that they know little of what is going on in the cottages and the beer-shops.

With respect to reforms, a change in the law of settlement seems to have become a matter of necessity, but it will not be without great hardships. Those hardships might be mitigated, and other good results attained, by a judicious system of allotments, in opposition to which I think Mr. Mill lays too much stress on the population dogma. But here one comes again upon the great truth, that a mere mechanical change is of little use. Allotments, with good superintendence, have worked admirably, but in other cases, where every lug of land is let by a hard battle between landlord and labourer, allotments only become a part of the general machinery for grinding the latter to the earth. In a word, whatever Laisser-faire may say, the English gentry are the keepers of these poor brethren of theirs, and will one day be called upon to show how they have discharged the trust.

CHAPTER IV.

AGRICULTURAL LOANS.

"I bring fresh showers to the thirsting flowers

From the seas and the streams."-SONG OF THE CLOUD.

Loans warranted by the Excess of Capital.

THERE is scarcely any proposition upon which there is a more general agreement amongst enlightened men, than that there is immense room for the investment of new capital in agriculture, and that, with proper management, there is no other kind of industry in which there would be so great a certainty of a profitable return.

If the explanations given in the first part of the present work, relative to the growth of capital in England, be correct, it will appear that the habitual condition of this country is that of having a large portion of capital seeking for, and unable to find, investment; that this is pre-eminently the case at the present moment, and likely to continue so, until some outburst of disastrous and demoralizing speculation carries off the excess for a time. If the explanations in question have been found by any reader to be erroneous, he may at once dismiss the present chapter as unworthy of his attention.

The principle laid down by those economists whose reputation stands highest is, that new capital creates a demand for itself; that it is a confusion of ideas to imagine the possibility of such capital being accumulated in excess; that new savings can and do regularly find employment, and, owing to the acute perceptions of private interest, that employment which yields the best return. This is what is held as the orthodox doctrine

of political economy. If it be true, then the proposition I am about to make may be at once set aside as the dream of a projector, or the crotchet of a lunatic. But if any reader has followed the reasonings of the first part, and is convinced that the links of the chain are all sound, and has, too, a better ground of assurance, from knowing that the conclusion is fortified by the facts of every day and every hour, then, to him the proposition may be presented as worthy of the most serious consideration. It may be stated in the following form:

There is at present, and there is likely to be, a large amount of capital disposable for permanent investment.

This capital could not be invested in any way with so great benefit to the whole community, as in an improved cultivation of the soil.

Those occupiers who now want capital most are not likely, through any private effort or bargain, to obtain the use of what is thus offered for permanent investment.

Government, by means of its perfect credit, might intervene, and, without loss to the public, bring capital not only for drainage, but for general agricultural purposes, within reach of those cultivators.

It might do so by borrowing, say ten millions sterling, which it could do at three per cent., and advancing the money upon security, with a condition of repayment by twenty-two equal annual instalments, as under the Drainage Act, including both principal and interest.

The money might be advanced to small proprietors cultivating their own land, who are still numerous; to farmers who had or might obtain such leases as would constitute a good security; and to others with or without leases, whose landlords would consent to make the land liable for the payment of the annuity 1.

If this book should attract any notice, there will, no doubt, be critics ready at once to set down this scheme as a mere repetition of Mr. Disraeli's "Cheap Capital for the Farmers." I must give them the advantage of acknowledging that, when that suggestion was first made, I thought it absurd and unworthy of serious atten

If advances to the amount named were taken out on good security, there is no reason why a second loan of the same amount should not be applied in the same way.

Farmers cannot obtain Capital for themselves.

The first and second propositions need no further enforcement, nor is it necessary to spend many words in showing that those occupiers who now most want capital are not likely to obtain it through any of the facilities existing in the money market.

The ordinary economical notion of capital is of something flowing by an irresistible impulse into every nook and corner in which more than the ordinary rate of profit can be obtained. Capital, it is said, has wings, and flies with ease over all fetters and obstructions to that precise spot in which it will obtain the best return. Hence, the assertion that a particular employment, towards which new capital is not actually moving, might be turned to great account, is always received by the political economist either with suspicion, or, as commonly happens, with unqualified denial. However fair appearances may be, there is deception somewhere. He is sure that such a thing cannot exist, and therefore that it does not. This maxim, like so many others, is true within certain limits, but very far from true beyond those limits. It is true in commerce, and the observations on which the maxim was founded had reference mainly to what takes place in commerce. The nature of most commercial operations is, to bring in quick tion. I had then sufficient faith in the reigning economical system, to believe that any meddling of the Government with the disposition of capital must be a folly. Having come, however, to the clearest conviction that the dogma of the economists respecting capital is false, I cannot adhere to any argument which was built upon it. I may add that, from the address of the Chancellor of the Exchequer which has just appeared, there is every reason to believe that he feels unable to persevere with his project of supplying capital to the farmers. He presents to the electors of Bucks nothing but the old chopped straw of changes in taxation, from which they will cer tainly derive no nutriment.

returns; and where, as in the foreign trade, the returns are not speedy, it yet happens that, the several operations being continuous, and going on in different stages at the same time, there is something like a continuous influx of returns; so that the merchant or trader has his capital at command in a way unknown to him whose returns come in only once in a year, and at one particular season. Hence, a merchant or trader can make use of much capital borrowed on short loans, and has great facility in enlarging or diminishing the amount of such borrowed capital. Capital of this kind, it has been seen, is that which is distributed by bankers, and the nicety and rapidity with which they can apportion their supplies to the wants of different branches of trade have, no doubt, contributed much to the notion of capital invariably rushing to every profitable investment.

It is further to be observed, that in commerce the return brings back the whole outlay; but in any industrial operation which involves the creation of fixed capital, the return, even when successful, is only an annual profit, out of which, by the time that the fixed capital is worn out, the original outlay may be expected to be replaced. But for any purpose of this kind the capital lent by bankers is not available. When capital is wanted on loan, for the purpose of being sunk, as the phrase is, or as a long investment, it is far less easily obtained. There must be lawyers, and bonds, and formalities, which, combined with a pretty high rate of interest, render the whole operation slow and unadvisable in the greater number of enterprises, except in those cases in which a wealthy body, like a railway company, takes up a large sum at once upon bonds, which are almost as negociable in the market as those of the Government.

Prosperous Trades create their own New Capital.

It is, however, a fact, that new investments do annually take place by sinking capital in various branches of industry.