useful purposes, and a smaller portion dedicated to a distant future.  This readjustment the rate of interest helps to bring about.  For it rises to a higher level, and there is accordingly a strong inducement to all manufacturers and traders to economize their use of capital, and thus to set free productive resources for more urgent needs.  But, while the meshes of the sieve, as it were, contract in times when it is desirable that they should contract, we have no reason for supposing that they will contract in just the degree that is desired, neither more nor less; or, indeed, that at any time they approximate to the right size.  We in the twentieth century owe much of the material wealth that we enjoy to the fact that over the last century men saved as largely as they did.  But our natural gratitude should not restrain us from doubting whether they were really well advised to do so.  If we ask the question how they managed to do so, our doubts are deepened.  For first place among the explanations must be assigned to the inequality in the then distribution of wealth.  It was because many men in England were rich enough to save that our railways were built, and the resources of new Continents were opened up.  But England, a century or even half a century ago, was not really a rich community.  And if the national income in those days had been distributed more evenly among the people, can we doubt that they would have spent a far larger proportion of it on immediate needs; can we doubt that they would have been right to do so?  We may rather doubt, in view of the reactions of poverty on physical and mental efficiency, on social harmony, even possibly on population, whether we to-day would have been really injured as much as might appear.  How, then, can we suppose that the sum of the amounts which it suits individuals to save will bear any close relation to the resources which the community can properly devote to future ends?  Are we to regard an unjust distribution of wealth as a mysterious dispensation of Providence for securing perfect harmony between the future and the present?  The point need not be labored further.  There are no grounds for assuming that we save, as a community, even roughly what we ought to save.  If we wish to believe we do, we must turn for support from economics to theology.

It is important to be clear upon this issue in order to distinguish it from another, with which it sometimes seems to be confused.  This is the question, briefly outlined in Chapter II, of the effect of changes in the rate of interest on the supply of capital.  As was there indicated, there are good reasons for supposing that a fall in the rate of interest would induce some people to save more, and conversely.  But the balance of probability is in favor of the conclusion that the net effect of changes in the rate of interest, though perhaps slight, is usually of the more ordinary kind.  The decisive argument in this connection is the fact, upon which we have