7 6 TUE PROBLEM OF THE UNEMPLOYED
allowed that the ultimate object of persons who save is
always the desire to consume an increased quantity in
the future, this individual policy may and does result
in a congestion of forms of capital which is suicidal from
the collective point of view. In a society composed of
A, B, C, D, E, F, any three, say ABC, might save
as much as they liked, or each and all might save a
definite proportion of their income, but any policy of the
individual members which collectively exceeded this aggregate
would be wasteful. Yet it might be quite possible
that all individuals in this over-saving community were
actuated by a genuine desire to consume largely in some
distant future.
An individual may save any proportion of his income,
provided he can induce others to spend their income
and give him liens upon their present property or future
production. But the proportion of a community’s income
which it can save and usefully store up in plant, machinery
and other forms of capital is strictly limited by the rate
of current or prospective consumption. Only a very small
proportion of “saving” can profitably be invested in forms
of capital that fructify in the distant future ; the current
or immediately prospective rate of consumption determines
pretty closely the proportion of current income which can
be usefully saved.
§ 16. Excessive Forms of Capital do Exist.
To the suggestion that an excess of saving is possible
it is often deemed a sufficient answer to point to the
infinitude of human wants and the new industrial enterprises
which they can vitalise. Why, it is urged, should
you assume that any trade will be over-stocked with