provement in the general productive power of a community, only
a certain proportion of that increased power can be economically
applied to "saving"--_i.e._, to the increase of forms of capital; a
due proportion must go to increased spending and a general rise in
consumption.

Sec. 12. This will hardly be disputed, except by those who still follow
Mill in maintaining that the whole of the current production could be
"saved," with the exception of what was required to support the
efficiency of labour, a doctrine to which even he could only give
passing plausibility by admitting that the increased savings which
resulted from an attempt to do this would take the shape of luxuries
consumed by the said labourers--that is to say, would not be "savings"
at all, but a transfer of "spending" from one class to another.[165]
If capital be confined to commercial capital, and "saving" to the
establishment of the forms of such capital, no one will deny that the
quantity of "saving" which can be effectually done by a community at
any time depends upon the current rate of consumption, or that any
temporary increase of such saving must be justified by a corresponding
future increase in the proportion of spending.[166]

This will be generally admitted. But there are those who will still
object that production just as much limits and determines consumption
as consumption does production, and who appear to hold that any
increase in present saving, and the consequent increase of amount of
plant and stock, has an economic power to force a corresponding rise
of future consumption which shall justify the saving. This they urge
in the teeth of the fact that in a normal state of industry in
machine-using countries there exists more machinery and more labour
than can find employment, and that only for a brief time in each
decennial period can the whole productive power of modern machinery be
fully used, notwithstanding the increasing blood-letting to which
superfluous saving is exposed by the machinations of bogus companies,
in which the "saving" done by the dupes is balanced by the "spending"
of the sharps. Ignoring the fact that the alleged power of increased
saving to stimulate increased consumption is not operative, they still
maintain that there cannot be too much "saving," because the tendency
of modern industry is to make production more and more "roundabout" in
its methods, and thus to provide scope for an ever-increasing quantity
of for