of competitive business whatever is generally advantageous becomes a necessity for all competitors. Those who take advantage of the opportunities afEorded by credit are in a position to undersell any others who are similarly placed in all but this respect. Speaking broadly, recourse to credit be-j comes the general practice, the regular course of i competitive business management, and competition goes on on the basis of such a use of credit as an auxiliary to the capital in hand. So that the competitive earning capacity of business enterprises comes currently to rest on the basis, not of the initial capital alone, but of capital plus such borrowed funds as this capital will support.
The competitive rate of earnings is brought to correspond with this basis of operation ; the consequence being that under such competitive employment of credit the aggregate earnings of an enterprise resting on a given initial capital will be but slightly larger than it might have been if Buch a general recourse to credit to swell the volume of business did not prevail. But since such use of credit prevails generally, a further consequence is that any concern involved in the open business competition, which cannot or does not take recourse to credit to swell its volume of business, will be unable to earn a " reasonable " rate of profits. So that the general practice drives all competitors to the use of the same expedient;