SIR GEORGE GREY’S LOGIC.

New Zealand Times, Volume XXXIV, Issue 5740, 22 August 1879, Page 3

SIR GEORGE GREY’S LOGIC.

TO THE EDITOR 01' THE NEW ZEALAND TIMES. Sir, —The Premier of New Zealand having seemingly satisfied himselt and his hearers that “ very little capital is required in a new country,” went on to deal with another branch of the same subject in the following words;— “ If you follow the whole question out you will find it all comes to this : that capital consists, or is made from the earth by the human beings who walk upon the earth. These are the two great sources of capital. Let us now come to the question and boldly face it. Let me utter words to you to-night which no political economist has ever uttered, and which I believe men have been afraid to utter, because they have seen the state of things I refer to. I ask you to admit whether these words are true or not, and to ponder them over in your minds, I say with regard to these two great sources of capital—we first of all have the earth to deal with—the earth, dumb, insensible, without passions, without hopes, without fears, senseless absolutely. That great senseless mass has been for years the care of Judges ; has been for years the care of legislators ; has been for years the care of those who love to possess it, and to keep other men from it.” Contrasting this care, which according to him has been bestowed upon the earth for its own sake, with the neglect with which for hundreds of years millions of human beings, with their hopes and sorrows have been treated, he professes that his object is so to “ use the earth that the other element that creates capital—human beings—shall be considered instead of the earth upon which they stand,” In dealing with the utterances of a gentleman who uses vague and lofty language in a manner which renders it difficult to discover what he “ precisely means,” to use Locke’s favorite expression, it is not easy to expose his fallacies without an amount of analysis which would be tedious both to write and to read. I shall therefore content myself with controverting what is the obvious meaning of the argument used by Sir G.JGrey, though well aware that I shall be accused of misrepresenting him by those who regard him as an oracle. In the first place I may observe, that so far as his proposition “ that capital consists or is made from the ear.h,” is true, it is not original. It was the basis of the theories of political economy propounded by the well-known French “ Physiocrats,” whose founder, M. Quesnay, was a physician at the Court of Louis XV., and whose “Tableau Economique ” was published in 1758, nearly twenty years before the publication of the “ Wealth of Nations.” Assuming as a selfevident truth that the earth is the only source of wealth, Quesnay proposed that all existing taxes should be repealed, and that a single tax laid directly on the net produce or rent of land should be imposed in their stead. This is so mueh in accordance with Sir George Grev’s peon iar opinions that I fancy many of his political ideas must be derived from the French writers of the last century, which supposition is confirmed by the style of his declamation and his method of reasoning, both of which are eminently French. All such notions, however, which went beyond the barren truism that as we live on the earth we must get all we want from it, have been long ago exploded, not because political economists were afraid to discuss such subjects, but because, unlike Sir George, they object to talk or write nonsense. Without natural powers for labor to apply to the production of wealth capital could not exist, and of these natural powers land is one of the most important. But so far as land is concerned, the condition precedent—the indispensable physical and moral facts which constitute it a utility at all—involve some sort of security in its possession. Now, it is solely for the purpose of making this great natural power—this great productive machine —subservient to human use that so much attention has been paid to it. In other words, legislators and judges, taught by the whole course of human history, have practically understood that industry is limited by capital, that capital is the result of the earnings of labor, that security is essential to the accumulation of capital, and to the most effective employment of labor, and hence the “care" which Sir G. Grey chooses to represent as being exercised for the benefit of the earth, or of those few who own large portions of it, is really exercised for the benefit of the community at large. The truth is that the method adopted by Sir George Grey in discussing economic and political problems is essentially vicious. It is, in fact, as Professor Cairns says of Bastiat’s writings, “ one more example of that style of reasoning on political and social affairs which flourished so luxuriantly in France during the latter half of the last century, and is not yet quite extinct, of which the ‘ Social Contract ’ may be taken as the type, and the ‘ .Declaration of the Rights of Man ’ as the best known practical outcome—a species of hybrid philosophy, consisting, to borrow the language of Mr. Mill, ‘ of attempts to treat an art like a science, and to have a deductive art.’ ‘I speak,’ says Mr. Mill, ‘of those who deduce political conclusions, not from laws of nature, not from sequences of phenomena real or imaginary, but from unbending practical maxims. Such are all who found their theory of politics on what is called abstract right.’ ” I agree with an enthusiastic admirer of Sir George Grey in thinking that his speech, carefully corrected by himself, should be in the hands of every elector, not however as an exposition of a difficult subject, but as a “ shocking example ” of the sort of rubbish to which a clever man may commit himself. Published with marginal notes, taken let us say from Mills’ “ Fundamental Propositions respecting Capital ” —such as that “ every increase of capital gives, oris capable of giving, i additional employment to industry, and this

without assignable limit ;” or that “ what capital does for production is to afford the shelter, protection, tools ami materials which the work requires, and to feed and otherwise maintain the laborers during the process ” —it might do good, and as a fine example of the “ fallacies of confusion ” it would form an excellent examination paper in logic at the next examination of the New Zealand University. Apart from these somewhat base uses, I cannot think that anything contained in Sir George Grey’s speech is likely to prcve a valuable contribution to economic science.—l am, &c., Economist.