JB_017_165.xml

Title: [31 Oct. 1801 + A Polit. Economy]

Description: 31 Oct. 1801

+ A

Polit. Economy

Method

Indication of the Indirect Income-Tax resulting from Encrease of Money.

In Britain. money is about ,72,000,000, mean (Ao 1801) about ,216 000 000

(72:216::1:3.) Each million added to money, adds therefore three million for

ever to pecuniary income and this (setting aside the 15 per Cent for ever

(,150,000) for profit on the million, if employ'd in the shape of capital)

without addition to real income. If every year ,2,000,000 be added to money,

plus ,300 000 for an equivalent to the addition made as above to real wealth, in

36 years (Ao 1837) the nominal or pecuniary amount of a mass of real income

equal to the amount of 1801 will be doubled i:e: become ,432,000,000: to which

will be added ,10 800 000 for an equivalent to the intermediate additions to

real wealth (,300,000 x 36) But the ,432 000 000 of 1837 being worth no more

than the ,216 000 000 of 1801, each ,10 of the ,432 000 000 will be worth but

,50 of the ,216 000 000: that is the income of each fixed-incomist will have

been subjected to an indirect income-tax of 50 per Cent: the King's ,900,000

will be reduced to ,450,000. He whose pecuniary income in 1837 is double what it

is in 1801 will in point of wealth be neither a gainer, nor loser, by the

change. Not so in point of comfort. For, by so much as he is a gainer in wealth

in the one way, by so much he is a loser in the other: and by the nature and

constitution of the human frame, sum for sum, enjoyment from gain is never equal

to suffering from loss.}

JB_017_195.xml

Title: [29 Oct. 1801 Polit. Economy]

Description: 29 Oct. 1801

Polit. Economy

Non Facienda

2 Encreasing Money

4

6

{2. If the fresh money on the occasion of the first employment or expenditure

made of it is employ'd in purchases the inordinate effect of which is not to

make any immediate addition to the mass of really productive capital, it then

makes no addition to the growing mass of real wealth.

In this case there is the usurious interest as in the former - the interest of

300 per Cent - but no profit made by it. but the profit altogether wanting. The

3 million a year income-tax stands pure and neat: the ,150,000 deduction has no

place here.}

{From the amount of this depretiation and this interest is to be deducted on a

strict reckoning the sum[?] equivalent for the goods produced in each year by

the addition thus made to the mass of real capital: say 15 per Cent for ever

upon the million so employ'd. But this deduction is so small as in large[?]

sums[?] to be scarce worth bringing to account. From /Upon/ the 3 million a year

it amounts to but ,150,000.}

JB_017_344.xml

Title: [8 March 1804 Wealth I. 2 a]

Description: 8 March 1804

Wealth I. 2 a

2

HK Political Economy - Non-Facienda - 2. Encreasing Money.

1. If money at its first introduction be employed in making an addition to

productive capital, it is so much added to real wealth. p.1.

2. But by this addition the value of the whole mass of money is diminished, and

it is worth no more than the whole mass of vendible articles, as before. p.1.

3. The effect of this depretiation is to impose a virtual Income Tax on fixed

Incomists. p.2.

4. Circulating money 72 millions - national Income 216 millions - in this state

of things the effect of the introduction of one million into the circulation

would be to add 3 millions to the national income, while the quantity of

vendible articles would remain the same. p.2.

5. The amount of the tax is diminished by the compensation to those to whom the

money immediately passes. p.2.

6. By this operation an addition is made to national capital by raising money at

300 PrCt.

7. From this depretiation is to be deducted about 15 PrCt for goods produced by

capital - amounting to ,150,000 out of the 3 million. p.3.

8. 2. If a mass of money at its first introduction is not employed in making an

addition to capital it then makes no addition to wealth. p.4.

9. In this case as in the former there is the 300 PrCt interest, paid tho'

without any profit being made upon it. p.4.

1. Non-agenda.

1. Adding to money to add to real wealth.

2. Encouraging a particular branch of wealth under the idea of increasing the

aggregate wealth. p.1.

2. Pecuniary wealth always being equal to real wealth, the effect of an addition

to money is to depretiate the existing stock of it. p.1.

3. Every issue of paper money is therefore a tax upon fixed incomists, and the

effect of it on wealth depends on its being issued as Income or Capital or lent

to be employed as Capital.

p.2.

4. In England income is to money as about 3 to 1 so that for every ,100 thus

added to capital a tax of ,300 a year is laid on fixed incomists deducting

/minus/ 15 per cent for commercial profit. p.2.

5. More