Economics for Helen by Hilaire Belloc

You will notice that all about you living beings are occupied in changing the things around them from a condition where they are _less_ to a condition where they are _more_ useful to themselves.

Man is a living being, and he is doing this kind of thing all the time. If he were not he could not live.

He draws air into his lungs, taking it from a condition where it does him no good to a condition where it keeps him alive. He sows seed; he brings food from a distance; he cooks it for his eating. To give himself shelter from the weather he moulds bricks out of clay and puts them together into houses. To get himself warmth he cuts down wood and brings it to his hearth, or he sinks a shaft and gets coal out of the earth, and so on.

Man is perpetually changing the things around him from a condition in which they are _less_ useful to him into a condition where they are _more_ useful to him.

_Whenever a man does that he is said to be creating, and adding to, Human Wealth_: part of which is Economic Wealth, that is Wealth suitable for study under the science of Economics.

Wealth, therefore, that thing the nature and growth of which we are about to study, is, so far as man is concerned, the result of this process of changing things to man's use, and it is through looking closely at the nature of this process that we get to understand what is necessary to it, and what impedes it, and how its results are distributed among mankind.

We must next go on to think out _how_ wealth is so produced. We have already seen what the general statement on this is: Wealth is produced by man's consciously transforming things around him to his own uses; and though not everything so transformed has true _Economic Wealth_ attaching to it (for instance, breathing in air does not produce Economic Wealth), yet all Economic Wealth is produced as _part_ of this general process.

Now when we come to examine the Production of Wealth, we shall find that _three_ great separate forces come into it; and these we shall find to be called conveniently "Land," "Labour" and "Capital."

Let us take a particular case of the production of Economic Wealth and see how it goes forward. Let us take the case of the production of, say, 100 sacks of wheat.

1. LAND.

A man finds himself possessed of so much land, and when he sets out to produce the 100 sacks of wheat, the following are the conditions before him.

There are natural forces of which he takes advantage and without which he could not grow wheat. The soil he has to do with has a certain fertility, there is enough rainfall to make the seeds sprout, and so on.

All these natural forces are obviously necessary to him. Though we talk of man "creating" wealth he does not really create anything. What he does is to use and combine certain natural forces of which he is aware. He has found out that wheat will sprout if it is put into the ground at a particular season, and that he will get his best result by preparing the ground in a particular manner, etc. These natural forces are the foundation of the whole affair.

For the sake of shortness we call all this bundle of natural forces (which are the very first essential to the making of wealth) "LAND. " This word "Land" is only a conventional term in Economics, meant to include a vast number of things beside the soil: things which are not Land at all; for instance, water power and wind power, the fertility of seed, the force of electricity, and thousands of other natural energies. But we must have some short convenient term for this set of things, and the term "Land" having become the conventional term in Economic Science for all natural forces, it is now the useful and short word always used for them as a whole: the reason being, I suppose, that land, or soil, is the first natural requisite for food -- the most important of man's requirements, and the _place_ from which he uses all other natural forces.

We say, then, that for the production of wealth the first thing you need is the natural forces of the world, or "Land."

2. LABOUR.

But we next note that this possession of natural forces, our knowledge of how they will work, and our power of combining them, _is not enough to produce wealth_.

If the farmer were to stand still, satisfied with his knowledge of the fertility of the soil, the quality of seed, and all the rest of it, he would have no harvest. He must, as we have said, prepare the land and sow the seed: only so will he get a harvest at the end of his work. These operations of human energy which end in his getting his harvest are called "LABOUR": that is, _the application of human energy to natural forces_. There are no conditions whatsoever under which wealth can be produced without natural forces or "land; " but there are also no conditions whatsoever under which it can be produced without "labour," that is, the use of human energy. Even if a man were in such a position that he could get his food by picking it off the trees, there would still be the effort required of picking it. We say, therefore, _that all wealth comes from the combination of LAND and LABOUR: That is_, of _natural forces_ and _human energy_.

3. CAPITAL.

At first sight it looks as though these two elements, Land and Labour, were all that was needed; and a very great deal of trouble has been caused in the world by people jumping to this conclusion without further examination.