3.5 Individual Consumption
Individuals consume with the object of satisfying their own wants or those of their families. These wants are chiefly based on the necessities of existence (food, raiment, lodging) and amusement. The means to satisfy those wants are the personal industry, capital, and land of the individuals within a family, and the wealth of the family advances or declines corresponding to the degree to which their production meets, exceeds, or is exceeded buy their consumption. Each addition to a family (child) increases the needs of consumption and, eventually, production when the child has reached an age to become productive.
It is often supposed that production and consumption are steady, and that deviations are the result of unexpected events, misfortune being more common than fortune, and the prudent set aside some measure of their income for unforeseen events.
But by the same token, much criticism is heaped on those who conserve too much, or are too productive, and become wealthy. So long as wealth is accumulated by "honorable means," there seems to be no harm in this, and the suggestion that a person who amasses wealth by being modest in their consumption is in some way detrimental to society seems to derive from no logical basis.
The responsibility for meeting the needs of an individual fall to the individual himself: none are better fit to make the determination for him, to daily assess his needs, to direct his production, or otherwise to interfere. Where he makes poor choices, his deprivation is his own punishment or his prosperity is his own reward, by the very consequence of the choices he has made for himself.
In respect to consumption, prodigality and indolence are the vices of man: to consume too much or produce too little. Prodigality is "the more amiable" of the two - it may be argued that those diversions on which a prodigal splurges are wastes of wealth, but given that everything bought by a prodigal is produced by others in the same society, the wealth is not entirely lost.
Indolence and avarice are of the same nature: whether a man produces or spends too little, production is retarded on the level of the community for want of his effort. Of the two, avarice is if the least concern: what is not spent by a miser presently will in time be spent by his heirs, but what is not produced by a loafer is a los that is not amended.
It is a common but absurd habit for spendthrifts to boast of their prodigality, to speak of sums spent in wasteful pursuits is intended as self-aggrandizement, but seems more a sign of lack of self-discipline for a man, like a base animal, to consume as much as he can lay his hands upon without any reasonable object.
However, those who practice avarice are as absurd as the prodigals. To gather capital for no purpose other than to have it, especially when it means depriving oneself of comfort, defies good reason. The fortune in capital a miser amasses is the poverty of his existence.
If a virtue is to be applied to economic behavior, it would be the a balance between production and consumption: the "economical man" provides for his needs and indulges his wants proportional to his productive capabilities, setting aside some measure as a means of withstanding misfortune.
The economy of a community or a nation is nothing more than the aggregation of individual consumption - and as such there can be no fixed rule or principle. One man may not define happiness for another, to suggest that he must be miserable unless he has more or less of one item or another or of all items in aggregate. It is, perhaps, possible to calculate the very minimum with which a person can persevere, but quite impossible to calculate the amount at which he arrives at the pinnacle of happiness. Some are happy with very little, others unhappy with very much.
Say considers some of the perspectives that attempt to distinguish necessities from luxuries, and finds that the difference is not very distinct. Primitives seem to get by with foraging roots and grubs, wearing animal skins, and sleeping in tents or mud huts. In Say's culture, bread and meet are food, wool and cotton make for clothing, and people live in well-furnished homes of masonry. It is doubtful any resident in Say's time, reduced to the trappings of primitive man, would feel he has the necessities of life.
The notion of luxury is likewise variable: some cultures favor ostentation (fashionable clothing) and others sensuality (a sumptuous meal). Luxury may be had in the quality or quantity of items, or even lack a material manifestation (to enjoy an orchestral performance is a luxury).
Say does not stigmatize luxury any more than he does wealth: so long as luxury is earned by production, and indulgence in it does not detract from one's ability to maintain the necessities, it does no harm. Where luxury is denigrated, it is supposed that one man came by it by depriving others - but this is not necessarily so.
Moreover, luxury drives the bulk of man's economic activity. The basic needs of man being simple, it requires very little effort to provide them for himself. He may either spend his days idly wasting time, or continue to produce - and if he continues to produce, what then is to be done with that which he produces? His excess may be buried or "thrown into the sea" but for the potential for luxurious indulgence.
(EN: There follows quite a lot of verbiage refuting the arguments in favor of a more Spartan existence and those who regard luxury as vice, which doesn't seem to add much to the argument. Suffice to say that when people argue against luxury, it is invariably that they envy someone else's luxury or disagree with someone else's definition of material happiness. Each man is quite capable of assessing and pursuing his own happiness, which gets back to Say's point about there being no universal standard.)
He returns to the point that systems of economics that begin with production, assuming consumption merely follows, being backward in their logic, as it is the desire to consume that urges men to produce. The belief that giving incentive to production will lead to greater prosperity is a fallacy, in that people are not happy consuming whatever happens to have been produced, when what is produced for the sake of productiveness is not what anyone wishes to consume. In such a situation, the result is not prosperity but waste.
Nor is deprivation a motive to produce: it can be witnessed that the "the laziest nations are those nearest to the savage state." A man who is accustomed to having nothing feels little need for more of the same. However, a man who has the benefit of things understands the greater benefit of having more: the primitive who has never worn a shirt has not desire to acquire one; the man with one soon sees the benefit of owning a second, and having two would prefer to have a dozen.
To promote the general welfare, however, both the rich and the poor must abandon the fallacy that for one man to have more, another must have less. This is not witnessed in any productive society, in which it is readily witnessed that productivity, not capital, determines the availability of goods to be consumed. To have more, each man must produce more, and trade for the production of his neighbors who, being more productive, have more to give in return.