an worker might not be adequately protected. The
influx of foreigners might more than offset the slowness of the
natural growth of population in America itself. The most important
illustration of this principle is afforded by the new connection which
America is forming with the Asiatic nations across the Pacific.

CHAPTER XX

THE LAW OF ACCUMULATION OF CAPITAL

Adam Smith and many others have noticed that the growth of capital
varies with the intelligence and the foresight of a population. It
should therefore increase in rapidity as intelligence increases. A
high valuation of the future is a mark of intelligence, and there is
no reason why an entirely rational being should value a benefit
accruing to himself in the future any less than he does a benefit
accruing at once. Perfectly rational estimates of present and future,
if there are no influences affecting the choice except these mere
differences in time, mean that the two stand at par. It was once
supposed that the disposition to save from one's present income varies
directly as the rate of interest of the capital which is thus accrued,
and in the main this is still regarded as a nearly self-evident
proposition. Abstinence imposes a present cost on anybody that
practices it. Whosoever saves a dollar misses the gratification which
that dollar might bring. He may regard that sacrifice as fixed. It
causes him to go without his marginal gratification, whatever that may
be. If interest for a year amounts to twenty-five cents, the man has
at the end of the year one dollar and twenty-five cents, with which to
do whatever he may choose. He may spend it, if he will, and get all
the gratification that a dollar and a quarter can bring. If interest
stands at five per cent per annum, his abstinence will bring him only
one dollar and five cents a year, and that, or whatever he can get by
means of it, is a smaller benefit than the one he could get for one
dollar and a quarter. If it is barely worth while to go without
something now in order to have a dollar and five cents in the future,
it is more than worth while to do it in order to have a dollar and a
quarter at the same future date. If a man is induced to save only a
dollar, for the sake of having a dollar and five cents at the end of
the year, why should he not save two dollars, in order to have two
dollars and a half at that time? Why should not the amount of his
present privation increase, when the surplus of bene