The Portland daily press., 1896-04-17
RELATION OF PROFITS AND WAGES.
MIR. w. MI. Coles Third Lecture on Eco
Monies.

Mr. William Morse Cole delivered the
third lecture in his course on Economics
at Assembly hall last evening, taking the
Relation of Profits and Wages" for his
subject.
Mr.. Cole said that no men work in
these days without the assistance of
capital. and even his wages are paid out
of capital. Temporarily, therefore, the
rate of wages will depend upon the
number of persons, desiring employment,
the number of commodities suitable for
their use offered them by patrons desiring
their services. An increase in the num-
ber of persons desiring employment with
out a corresponding increase in the
capital available for their payment pro.
dCces lower wages, and an increase IN
the capital offered as wages, without COR
responding in crease in the number de-
string employment, produces higher
wages. A sudden rise in the value OF
commodities produced does not necessari-
ly bring with it the ability to pay higher
immediate wages, for as wages are paid
out of capital the wage-paying power is
not Immediately affected.
Labor is capital. The rate of wages
therefore cannot permanently remain be-
low the point which suffices to supply a
working population. That amount is
determined largely by the workers them
selves. If workers will not u ndertake the
support of families at gain rate Of
wages then marriages decline, the birth
rate is reduced and the supply of workers
is decreased. Then the competition of
employers raises wages until the point is
reached when workers win marry and
assume the support of families There is
a marked connection between the rate of
labor.
The capitalist receives share of the
product increased by his capital. This
share is called profit. or interest The
justification Of this share lies i'll the fact
that the capital is the result of self denial
productive use wealth which he might
have spent in personal qualification. In
terest is just and it's payment dictated by
policy.
Chronologically, interest or profit is q
residue. 1t consists of the balance of
production after wages are paid. If the
total amount of production is fixed. the
greater the share of labor, the smaller
that of capital, and vice versa. The rate
of profit cannot permanently remain be-
low that point at which it is worth the
while of possible capitalists to save rather
than to spend their wealth. for the
moment it fails below that point expen-
diture increases and the fund for paying
wages decreases until laborers are OBJ
liged to accept lower wages or go without
work. Then this reduction of wages in
creases profits, and it thus restores the
rate at which wealth will be saved. A
very high rate of profit, on the other
hand, stimulates saving, and thus, by in
creasing the amount of capital seeking to
hire laborers, raises wages and partially
oounteracts itself. The migration of
capital Is an important check upon ex-
higher profits are not inconsistent. The
interests of laborers and Of capitalists are
conflicting only in the act of dividing
the produce of industry. They have a
common ground in the desire to increase
the produce so that the share of each may
be larger.
The distinction between interest and
profits is wide. One is the share of the
owner OF capital as such, and the other is
the share Of manager, or, strictly
speaking, wages of superintend enoe.
Tins. profits though usually associated
with capital, are really reward for labor;
and they form the usual path by which
men pass from the rank of laDorer to that
of capitalist.