esponding advance in
civilisation of the working with the other classes is morally
inequitable and industrially bad policy. I am not sorry that the
American does not save more. Neither am I sure but that if many
working-class communities I have visited on the Continent were
socially more ambitious, there would not be less danger from Radical
theories. One of the most intelligent manufacturers I ever met told me
a few years ago he would be only too glad to pay higher wages to his
working people, provided they would spend the excess legitimately and
not hoard it. He knew that in the end he should gain thereby, since
the ministering to new wants only begets others."[237] If there are
theoretic economists who still hold that "a demand for commodities is
not a demand for labour," they may be reminded that a paradox is not
necessarily true. In fact, this particular paradox is seen to be
sustained by a combination of slipshod reasoning and moral prejudice.
The growing opinion of economic students is veering round to register
in theory the firm empirical judgment from which the business world
has never swerved, that a high rate of consumption is the surest
guarantee of progressive trade. The surest support of the "economy of
high wages" is the conviction that it will operate as a stimulus to
industry through increased consumption. The working classes,
especially in the United States and in England, show a growing
tendency to employ their higher wages in progressive consumption. Upon
the steady operation of this tendency the economic future of the
working classes, and of industry in general, largely depends.

FOOTNOTES:

[225] _Wealth of Nations_, vol. i. p. 86.

[226] Cf. _Northern Tour_, vol. ii. p. 86.

[227] It is true that out-and-out defenders of the factories against
early legislation sometimes had the audacity to assert the "economy of
high wages," and to maintain that it governed the practice of early
mill-owners. So Ure, "The main reason why they (_i.e._ wages) are so
high is, that they form a small part of the value of the manufactured
article, so that if reduced too low by a sordid master, they would
render his operatives less careful, and thereby injure the quality of
their work more than could be compensated by his saving in wages. The
less proportion wages bear to the value of the goods, the higher,
generally speaking, is the recompense of labour. The prudent master of
a fine spinning-mill is most reluctant t