CHAPTER V.

OBJECT AND USE OF THE EXPOSITION.

The approaching Exposition is considered by many as a great and splendid show, calculated to give pleasure and excitement to hundreds of thousands of persons. Even in this sense it would be beneficial, for it is always important that the pleasures of the people should be productive of some advance in their tastes and information. But its great and paramount value depends on other causes. Its object may be most concisely expressed by stating that—

The Exposition is calculated to promote and increase the free interchange of raw materials and manufactured commodities between all the nations of the earth.

Its object is not the exclusive benefit of England, and if any such mistaken view is still entertained, it may without hesitation be stated that it would be impossible by any mode of management to accomplish so selfish an object.

It is the interest of every people, that all other nations should advance in knowledge, in industrial skill, in taste, and in science. The advances made in the two latter subjects acquire _permanent_ existence only through the _publicity_ given to their enunciation and discussion. Refining and elevating all by whom they are received, new principles in taste or in science, as soon as they are accepted as truths, become the universal property of mankind.

In whatever distant country any man devises means of diminishing the cost of production of the commodity he deals in, the following effects will result—

He will make larger profits than usual.

He will then diminish his price in order to get more customers.

His rivals in trade now find it necessary to undersell him in order to get back their customers.

Whilst this competition goes on, the price of the commodity falls, a larger consumption takes place and new purchasers will arise, which for a time checks the fall.

Ultimately, his rivals in the trade either remove their capital into other lines of business, or adopt the improved process.

In the mean time the first discoverer will, if a prudent and industrious man, have realized a considerable capital, for he will be fully aware that in the present state of science no monopoly can be permanent. He will rather seek for a succession of moderate improvements, which exciting no immediate inquiry or rivalry, shall increase the average per centage of his profits, thus constantly keeping his manufactory one, or at the utmost, only two steps in advance of his competitors.

When in consequence of such an improvement, a reduced price and an enlarged demand has arisen in his own country, the manufacturer will naturally make inquiries whether at this diminished price other countries may not be induced to become purchasers. If this is the case, the fact of their free interchange with him proves that they can acquire his commodity at a less cost than they can themselves produce it.

But although the Exposition itself could not and ought not to have been attempted for the sole benefit of this country, it is almost certain that England will reap the greatest share of its advantages. This will arise from the more extended system of her commerce, and from the habits of her people. The profits of the merchant, other circumstances being equal, depend upon the amount of his capital. Similarly, the knowledge brought back by the traveller in foreign countries, or derived from his observation in his own, will mainly depend on the stock of information he carried with him to give in exchange.

§ To arrive at those principles by which the Exposition ought to be regulated, it becomes necessary to examine the nature and extent of the interests involved.

In all interchanges there are three distinct parties concerned—

The Consumer, The Middle-man, The Producer.

The overwhelming superiority both in amount of capital and in the number of the first of these classes, the _Consumer_, is at once apparent, and ought throughout the inquiry to be steadily borne in mind. In fact, each individual of the other two classes is necessarily a member of the first; for all men are _consumers_, and as such their common bond of interest is to purchase every thing in the _cheapest_ market.

§ The class _Producer_ is equally indispensable for the purposes of exchange, but its number is much more limited. The interest of each individual producer is, that he should sell his _own_ produce at as dear a price as possible, whilst he purchases that of all other producers as cheaply as he can.

The class _Producer_, therefore, is not only comparatively small, but has really a very divided interest, arising only from the difference between the personal and the class interest of the individual.

§ The class _Middle-man_ is more extensive, comprising merchants, brokers, factors, wholesale and retail shopkeepers, hawkers, &c. The profits of this class are generally regarded by the public with some degree of suspicion. It is often thought that their profits are exorbitant. But in truth this is not frequently the case. The division of employments necessarily produces middle-men, and the public in the long run obtain the articles they require with more convenience and economy, and at a less fluctuating price, than it would be without such agency. But the number of intermediate agents in any commerce is itself subject to change, in different trades and at various times: it is quite possible that these changes may not have taken place with sufficient promptitude, and thus the public may have suffered for a time either by an excess or a defect in the number of middle-men.

The interests of middle-men are, individually, the same as those of consumers. As a class, the extension of commerce is for their advantage, because they are paid according to the amount of exchanges made. But they have also another and a very powerful interest. They fear that if the public were acquainted with the manufacturing price of articles, it would consider the difference between that and the selling price as a tax imposed by the middle-man upon the consumer. The middle-man therefore has a direct interest in preventing the public from arriving at a knowledge of the prices charged by the original manufacturer. It is also the interest of the middle-man that the manufacturer should not know the price at which his produce sells by retail: but, as it is in most cases impossible to prevent this, few attempts at concealment are made.

§ It appears, then, that the interests of these classes may be thus summed up—

Consumers, including every human being, have a strong interest in the freest competition as producing the lowest price.

Producers have an interest in selling their produce in the dearest market, and therefore claim free competition. But they have no advantage in selling it at the highest price: because a high price limits the extent of the sale. Their object is that the profit on each article, multiplied by the number sold, shall be the greatest possible.

Middle-men, although usually adverse to competition, have yet a direct interest in the amount sold.