This rapid sketch of the uses of capital will not be complete without its moral. The paramount value of capital to the prosperity of a nation should never be overlooked by a government. Unwise laws, restrictions upon commerce, impro vident taxation, which are unfavourable to its growth, should be dreaded as poison to the sources of national wealth and hap piness. No class is the better for its de cay or retarded growth: all derive be nefit from its increase. And above all, when population is rapidly increasing, let a government beware how it interferes with the natural growth of capital, lest the fund for the employment of labour should fail, and the numbers of the people, in stead of being an instrument of national power, should become the unhappy cause of its decay. The material happiness of a people is greatest when the national wealth is increasing more rapidly than the population ; when the demand for la bour is ever in advance of the supply. It is then also that a people, being con tented, are most easily governed ; and that taxes are most productive and raised with least difficulty. But while the na
tural growth of capital should not be interfered with by restrictions, the oppo site error of forcing it into particular channels should equally be avoided. In dustry requires from government nothing but freedom for its exercise ; and capital will then find its own way into the most productive employments ; for its genius is more fertile than that of statesmen, and its energy is greatest when left to itself. The best means of aiding its spontaneous development are a liberal encourage ment of science and the arts, and a judi cious system of popular education and industrial training ; for as " knowledge is power," so is it at once the best of all riches and the most efficient producer of wealth.
(Smith's Wealth of Nations, Book II. ch. 3, with Notes by APCulloch and Wakefield ; Ricardo On Political Eco nomy and Taxation ; M'Culloch, Princi ples of Political Economy ; Professor Jones On Me Distribution V Weaun Essays on some Unsettled Questions of Po. litical Economy, by John Stuart Mill.)