regulates itself by the funds which are to employ it, and therefore
always increases or diminishes with the increase or diminution of
capital.'[307] It was indeed a commonplace that the increase of
capital was necessary to an increase of population, as it is obvious
enough that population must be limited by the means of subsistence
accumulated. Smith, for example, goes on to insist upon this in one of
the passages which partly anticipates Malthus.[308] But this does not
enable us to separate profit from wages, or solve Ricardo's problem.
When we speak of supply and demand as determining the price of a
commodity, we generally have in mind two distinct though related
processes. One set of people is growing corn, and another working coal
mines. Each industry, therefore, has a separate existence, though each
may be partly dependent upon the other. But this is not true of labour
and capital. They are not products of different countries or
processes. They are inseparable constituents of a single process.
Labour cannot be maintained without capital, nor can capital produce
without labour. Capital, according to Ricardo's definition, is the
'part of the wealth of a country which is employed in production, and
consists of food, clothing, raw materials, machinery, etc., necessary
to give effect to labour.'[309] That part, then, of capital which is
applied to the support of the labourer--his food, clothing, and so
forth--is identical with wages. To say that, if it increases, his
wages increase is to be simply tautologous. If, on the other hand, we
include the machinery and raw materials, it becomes difficult to say
in what sense 'capital' can be taken as a demand for labour. Ricardo
tells Malthus that an accumulation of profit does not, as Malthus had
said, necessarily raise wages[310]; and he ultimately decided, much
to the scandal of his disciple, M'Culloch, that an increase of 'fixed
capital' or machinery might be actually prejudicial, under certain
circumstances, to the labourer. The belief of the labouring class that
machinery often injures them is not, he expressly says, 'founded on
prejudice and error, but is conformable to the correct principles of
political economy.'[311] The word 'capital,' indeed, was used with a
vagueness which covered some of the most besetting fallacies of the
whole doctrine. Ricardo himself sometimes speaks as though he had in
mind merely the supply of labourers' necessaries, though he regularly
uses