JB_017_235.xml

Title: [23 June 1801 Polit. Economy]

Description: 23 June 1801

Polit. Economy

Analysis D

Features

Encrease negative

Taxes

1

30

Encrease of wealth may be considered as /distinguished into/ either positive or

/and/ negative: negative consisting in the prevention of decrease.

Modes of negative encrease - 1. Preservation of individual articles against

unintended causes of deperition and decrease of quantity or value.

Such prevention may be either total or partial: it can only be partial, in cases

where decrease to a greater or less amount is indispensable, as in the case of

taxes.

Taxes are imposed to furnish means either for the future expenditure, or to

afford compensation to those who in times past have furnished the means for

expenditure which then was future: in other words for growing expences, or for

discharge of debts.

The amount of taxes imposed for growing expences takes from the amount of

national wealth in certain ways, and adds to it in other ways more or less

according as it is employ'd. It takes from the means or instruments of

enjoyment+ of those on whom the taxes are imposed: enjoyment present or future

immediate or more or less remote according as it would have been spent lent out

or hoarded had it not been for the tax.

it adds to the security of the whole in proportion as it is employ'd for the

purpose of national security in the way of National defence and otherwise: it

adds to the subsistence & enjoyments of a part, in proportion as it employ'd

/applied/ to those purposes by those among whom it is distributed in

consideration of the services by which they have respectively contributed to

that end.

+ This division must have preceded.

JB_017_301.xml

Title: [8 Sept. 1801 Polit. Economy]

Description: 8 Sept. 1801

Polit. Economy

Method

Finance

109

9

As to the other opinion - the ground of it is - that if the money taken in taxes

to be applied in discharge of the debt, had not been so taken but had been left

in the pockets of those to whom it belonged, it would have been spent by them,

each in his own way, and by that expenditure an addition would have been made to

the mass of national wealth. But supposing it taken from them to be applied in

discharge of debt, whatever is so applied is given to them and received by them

and employ'd by them - the whole of it in the shape of capital, whereas had it

been left with the parties by whom it is paid in taxes it would have been spent

/employ'd/ more or less of it as income is employ'd when it is said to be spent

{without return or hope of return} What the proportion may be /amount to/

between the part spent /employ'd/ as income and the part employ'd as capital,

and thereby employ'd in adding /making/ a growing addition to the mass of

national wealth will be /has been/ considered presently. For the present it is

something not to say sufficient that in one case it is only the /a/ part that is

employ'd in making an addition /additions/ /goes in augmentation/ to the mass of

wealth, and in the other case the whole.

JB_017_302.xml

Title: [8 Sept. 1801 Polit. Economy]

Description: 8 Sept. 1801

Polit. Economy

Method

Finance

110

10

The support given to this opinion is given in two ways. One is by thinking

nothing of what becomes of the money taken /drawn/ in taxes and made over to the

Annuitants in discharge pro tanto of the national debt, but /or/ considering it

as annihilated or thrown away.

The other is by considering the labour paid for by the money when spent by the

proprietor as it would have been had there been no /instead of being taken from

him in/ taxes as being employ'd all of it in the shape of pecuniary capital, in

making a correspondent addition to real capital, just as would have really been

the case with the labour paid for by that money had it been made over to

annuitants in discharge of so much of the debt.

That a part of it would really have been so employ'd does not admitt of doubt:

the error consists in supposing /considering/ what is true only of this part as

/as if it were/ true of the whole. Let us observe the difference between this

part and the whole.

Admitting an encrease of wealth - and that a gradual and regular one the

productive capital of the country taken together with the growing mass of

consumed[?] & reproduced wealth continually produced by it must be

considered as encreasing at compound interest The rate of interest can scarcely

be taken as so high as 2 per Cent: for at two per Cent compound upon the capital

taken as it stands /whatever it may amount to/ in any year, the quantity of it

would be rather more than doubled in 351/2 years.+ The most sanguine estimator

will not

+ Smarts Annuities Table 1. p.54.