MODERN INDUSTRIAL ENGLAND
§ 1. THE GROWTH OF OUR INDUSTRY--We have now traced the industrial
growth of England from the diffused beginnings of manufactures and
agriculture in the isolated manors, and have seen how gradually towns
grew up, commerce extended and markets arose, while manufacturers
became organized in various centres and regulated by gilds. We have
seen that for several centuries the back-bone of our national wealth
was wool, but that in time we ceased to export it, and worked it up
into cloth ourselves, thereby gaining great national wealth. We have
seen, too, how our foreign trade, after its petty beginnings in the
Middle Ages, took a fresh start {212} in the buccaneering days of
the Elizabethan sea-captains and then rapidly developed, by means of
the various great Companies, till England became commercially supreme
throughout the world. From commercial beginnings we traced the rise of
our Indian Empire, and the growth of the American colonies. Meanwhile
at home there came an Industrial Revolution which, happening as it
did at the moment that was politically most favourable to its growth,
gave England a very useful start over all other European nations in
manufacturing industries of all kinds, and enabled her to endure
successfully the enormous burdens of the great Continental war. Now
comes a time of still greater progress, economic as well as commercial,
for the old restrictive barriers to trade are to be swept away, and a
new economic policy is to be inaugurated.
§ 2. STATE OF TRADE IN 1820--If we now endeavour to gain some idea of
the trade of the country soon after the war, we may look for a moment
at its condition in 1820, just before Free Trade measures were begun.
The official value of foreign and colonial imports was declared to be
£32,000,000, which with a population of about 21,000,000 was at the
rate of about thirty shillings a head. The exports of home produce
amounted to some £36,000,000. The tonnage of shipping entering and
leaving our harbours was 4,000,000 tons, of which 2,648,000 tons
belonged to the United Kingdom and its dependencies. Steamers were, of
course, as yet unknown. Professor Leone Levi calculates the trade of
the country at not more than one-eighth or one-ninth of what it is at
the present time. The wealth and comfort accessible to the people in
general was much more limited, the consumption of tea, for instance,
being only 1 lb. 4 oz. per head, and of sugar 18 lbs. a head. In fact,
if we compare {213} the £244,710,066 worth of our exports in 1889–90
with the £32,000,000 worth in 1820 we see at once how gigantic has been
the growth of our trade. In 1889, again, the imports (for the first ten
months) were £347,985,087, which is more than nine times their value in
1820. But even at the beginning of the century England was far ahead
of her old rival France, for French imports were only worth £8,000,000
in 1815, and her exports only about double that amount, or less than
half England’s exports, which in that year rose to over £42,000,000
(official value).
§ 3. THE BEGINNINGS OF FREE TRADE--Now the year 1820 is memorable
not merely as showing the condition of our trade, but for the great
enunciation of Free Trade principles which it witnessed. For in that
year the London merchants formulated a noteworthy Petition praying that
every restrictive regulation of trade, not imposed on account of the
revenue, together with all duties of a protective character, might be
at once repealed. At last the teachings of economists were being put
into practice by men of business. The Edinburgh Chamber of Commerce
sent up a similar petition; a Committee was appointed in Parliament
to investigate the wishes of the petitioners of our two capitals; and
it brought in a report thoroughly in agreement with the Free Trade
principles of the merchants. In the following year Mr Huskisson,[60]
the President of the Board of Trade, proposed the first measures of
commercial reform, and one by one the restrictions upon our trade
were removed. The most important of the new measures was the gradual
alteration of the old Navigation Laws (cf. p. 130), finally culminating
in their total repeal in 1849.
[60. See more fully note 18, p. 251.]
It is true that in the period 1821 to 1830 the foreign {214} trade
of the United Kingdom did not exhibit much material improvement, but
still there was a steady increase. The official value of imports rose
from £30,000,000 to £46,000,000, and the value of British manufactures
exported from £40,000,000 to £60,000,000. But the declared value of
exports remained pretty steady at about £37,000,000. Yet in the United
Kingdom itself trade was growing rapidly, and the increase of wealth
gave an opportunity for a general diminution of taxes, and our sorely
strained finances were set in order. Many of the injurious duties upon
raw materials and articles of British manufacture--as _e.g._ those on
raw silk, coal, glass, paper, and soap--were taken off, to the great
advantage of our manufacturing industries.
§ 4. REVOLUTION IN THE MEANS OF TRANSIT--Now, too, another great
industrial revolution was effected. I refer to the introduction
of railways, steam navigation, and the telegraph, which have done
almost as much as the great inventions of the eighteenth century to
revolutionize the commerce of the world. In 1830 the Liverpool and
Manchester Railway was opened. In 1838 the first ocean passages to
New York by steamship were accomplished by the _Great Western_ from
Bristol, and the _Sirius_ from Cork; although ever since the beginning
of the century small steamers and tugs had been used for coasting
purposes, and on the River Clyde. In 1837 Cooke and Wheatstone patented
the needle telegraph, and the Electric Telegraph Company was formed
in 1846 for bringing the new inventions into general use. In 1840 the
penny postage came into operation. Yet more recently the Suez Canal
(1869) has shortened immensely the distance to the East. It is obvious
to all how incalculably all these inventions and appliances {215} have
aided the development, not only of English trade, but of the commerce
of all the world.
§ 5. MODERN DEVELOPMENTS. OUR COLONIES--Now I do not propose, in the
limits of a little work like this, to go into a detailed account of the
growth of commerce since these great modern inventions. There is ample
material for the student in larger works; and the statistics of our
progress may be consulted in the invaluable pages of Mr Giffen’s and
Professor Leone Levi’s books. Here I can only indicate in the broadest
outlines the chief features of the recent developments of industry. We
have followed the industrial history of England up to a period more
prolific in commercial events, and more remarkable for commercial
progress than any that preceded it. The experiments and tentative
measures of Mr Huskisson and other statesmen paved the way for a bolder
and more assured policy on the part of subsequent governments, till
at length Sir Robert Peel, urged on by the Anti-Corn Law League (p.
201), and stimulated by great famine in Ireland in 1845, openly adopted
the principles of Free Trade. Under his leadership the Corn Laws were
repealed (1846); the tariff was entirely remodelled, and the old
protective restrictions abolished, Mr Gladstone’s Budget of 1853 being
particularly memorable in this direction. A great increase of trade
followed the inauguration of the policy which is always associated
with the great name of Cobden,[61] and the wealth of the country was
even further developed. The extension of the railway system was at
the same time a cause and an effect of this development, and when the
great Exhibition of 1851, the precursor of several others, was held,
England was able to show to all the world her immense superiority in
productive and manufacturing industries. {216} A further stimulus to
trade was supplied by the discovery of gold in California and Australia
(1847–51), which supplied a much-needed addition to the currency of
the world. Meanwhile, since the war of American Independence, England
had been building up a great colonial empire, and she had the sense
not to attempt again to levy taxes upon her unwilling offspring. India
was taken over from the East India Company (1858). The colonies of
Canada and the Cape were gained by conquest; those of Australia and
New Zealand were the result of spontaneous settlement. The two former
were captured from the French and Dutch, but of the second of them
at least we have not made a commercial or even a political success;
nor are we likely to do so unless we can contrive to keep on good
terms with the original settlers, and to allow no misplaced sentiment
about native races to disturb cordial relations between Europeans.
As regards our Australasian colonies, they have grown far beyond
the expectations of former generations, and gained for themselves
entire political freedom, though they have chosen to use it chiefly
in carrying on a one-sided war of hostile protective tariffs against
their mother-country. As, however, they owe English capitalists a good
deal of money, the interest on which is paid in colonial goods, there
is a strong commercial bond of union between us and them; a bond which
protectionists in England are strangely anxious to break, by placing
unnatural obstacles upon the payment in goods of the interest due upon
colonial loans.
[61. See note 16, p. 250, on his French treaty.]
§ 6. ENGLAND AND OTHER NATIONS’ WARS--But besides the extension of
our colonial relations, English trade has benefited by the quarrels
of her competitors. The prostration of Continental nations after 1815
precluded much competition till almost the middle of the century, and
{217} then the Crimean War broke out (1854–56). As mentioned before,
this war gave a great stimulus to our agriculture, and had a similar
effect upon our manufactures. The Indian Mutiny which followed it did
not much affect our trade, but it rendered necessary the deposition
of the East India Company and the assumption of government by the
Crown (1858),[62] and thus eventually served to put our relations
to that vast and rich empire upon a much more satisfactory and
profitable basis. About the same time the Chinese wars of 1842 and
1857, regrettable as they were, established our commercial relations
with the East generally upon a firm footing, and since then our trade
with Eastern nations has largely developed. Then came the Civil War in
America (1861–65), after which there was an urgent demand for English
products to replace the waste caused by this severe conflict. The
Civil War was succeeded by a series of short European wars, chiefly
undertaken for the sake of gaining a frontier, as was the war waged by
Prussia and Austria upon Denmark (1864), followed by another struggle
between the two former allies (1866). Then in 1870–71 all Europe was
shaken by the tremendous fight between France and Germany, and since
then the Continental nations have occupied themselves in keeping up an
armed peace at an expense almost equal to that of actual warfare. All
their conflicts have arrested their industrial development, to their
own detriment but to England’s great advantage. Not content however
with that, they increase their difficulties by a dogged protectionism.
As a result, they are far poorer in general wealth than our own land,
and only succeed in competing with us by means of underpaid and
overworked labour. But the labourer will not {218} always consent
to be overworked and underpaid, and signs are not wanting that his
discontent is fast ripening into something more dangerous.
[62. See note 17, p. 250.]
§ 7. PRESENT DIFFICULTIES. COMMERCIAL DEPRESSIONS--But although English
commerce has reached a height of prosperity considerably above that
of other nations, it has not been and is not now without serious
occasional difficulties. It has been throughout the century visited
at more or less periodic intervals by severe commercial crises. In
the earlier portion of the century they occurred in the years 1803,
–10, –15, –18, –25, and –36; and were short, sharp, and severe. Since
1837 they have occurred at regular periods of about ten years, namely
in 1847, –57, –66, –73, and –82; latterly depression has been most
persistent, though with short cessations for special industries. In the
last year or two, however, trade has again revived, and on the whole we
may now (1896) be said to be enjoying a fair measure of prosperity.
The causes of such depressions in trade are various, and not always
obvious. They are, so to speak, dislocations of industry, resulting
largely from mistaken calculations on the part of those “captains of
industry” whose _raison d’être_ is their ability to interpret the
changing requirements in the great modern market of the civilized
world. A failure in their calculations, a slight mistake as to how long
the demand for a particular class of goods will last, or as to the
number of those who require them, results inevitably in a glut in the
market, in a case of what is called (wrongly) “over-production”; and
this is as inevitably followed by a period of depression, occasionally
enlivened by desperate struggles on the part of some manufacturer to
sell his goods at any cost. With such a huge field as the international
market, it is not to be wondered at that such mistakes are by no
means {219} rare, nor does it seem as if it were possible to avoid
them under the present unorganized and purely competitive industrial
system. They have been aggravated in England by a belief that our best
customers are to be found in foreign markets, and the importance of a
steady, well established, and well understood home market is not fully
perceived. “A pound of home trade is more significant to manufacturing
industry than thirty shillings or two pounds of foreign.” Now one of
the most important branches of our home trade must be the supplying of
agriculturists with manufactures in exchange for food. But when the
purchasing power of this class of the community has sunk as much as
£43,000,000 per annum, it is obvious that such a loss of custom must
seriously affect manufacturers. Again, no small portion of our home
market must consist in the purchases made by the working classes, yet
it does not seem to occur to capitalist manufacturers that if they pay
a large proportion of the industrial classes the lowest possible wages,
and get them to work the longest possible hours, while thus obtaining
an ever-increasing production of goods, the question must sooner or
later be answered: who is going to consume the goods thus produced?
§ 8. THE PRESENT CAPITALIST SYSTEM. FOREIGN MARKETS--The answer as
far as the capitalist is concerned seems to be: foreign customers in
new markets. English manufacturers and capitalists have consistently
supported that policy which seemed likely to open up these new markets
to their goods. For a long time, as we saw (p. 213), they occupied
themselves very wisely in obtaining cheap raw material by passing
enactments actuated by Free Trade principles and removing protective
restrictions. Cheap raw material having thus been gained, and machinery
having now been developed to such an extent as to {220} increase
production quite incalculably, England sends her textile and other
products all over the world. She seems to find it necessary to discover
fresh markets every generation or so, in order that her vast output of
commodities may be sold. This policy naturally receives the approval of
those engaged in foreign commerce, and most of our wars with countries
like China, Egypt, or Burmah, involve commercial interests. But as
other foreign nations are also engaging more widely in external trade,
the international struggle for new markets is liable to assume at any
time a dangerous phase. To-day, indeed, the industrial history of our
country seems to have reached a point when production under a purely
capitalist system is overreaching itself. It must go on and on without
ceasing, finding or fighting for an outlet for the wealth produced,
lest the whole gigantic system of international commerce should break
down by the mere weight of its own immensity. Meanwhile, English
manufacturers are complaining of foreign competition in plaintive
tones, which merely means that, whereas they thought some years ago
that they had a complete monopoly in supplying the requirements of the
world, they are now perceiving that they have not a monopoly at all,
but only a good start, while other nations are already catching them up
in the modern race for wealth.
§ 9. OVER-PRODUCTION AND WAGES--With all this, too, we hear cries
of over-production, a phrase which economically is meaningless,
more especially at a time when a very large number of people in the
civilized world are daily on the verge of starvation, when the paupers
of every civilized country are numbered by thousands, and plenty of
people who never complain have not enough clothes to wear and not
enough food to eat. Wages are certainly better than they were fifty
years ago, but no one who knows {221} the facts of the case will deny
that for the average workman--I am not speaking of skilled artisans
and the _élite_ of the working classes--it is practically impossible
to save anything out of his wages against old age or sickness. It is
not the business of a historian to vituperate any particular class,
but he may justly point out the mistakes to which classes have as a
matter of history been liable. And the great mistake of the capitalist
class in modern times has been to pay too little wages.[63] It is
an old agricultural saying--I believe of Arthur Young’s--that one
cannot pay too much for good land, or too little for bad land. The
same remark applies to labour. Capitalist employers rarely make the
mistake of paying too much for bad labour, but they have constantly,
as a matter of history, committed the worse error of paying too little
for good labour. At the beginning of this century, as I have shown,
the coming of the capitalist and of the capitalist factory system,
beneficial as it was ultimately to England, was followed by a time of
unprecedented misery and poverty for those whom they employed. The day
of the capitalist has come, and he has made full use of it. The day of
the labourer will come when he has the wisdom, and, we may add, the
self-denial, necessary for a right use of his opportunities.
[63. This is now not so true as it was some time ago.]
§ 10. THE POWER OF LABOUR. TRADE UNIONS AND CO-OPERATION--But the
labourers of to-day are a very different class from their ancestors
of fifty or seventy years ago. They have learnt, at least the most
advanced among them, the power of combination, a remedy which at one
time was forbidden them, but which is now fortunately once more theirs.
The steady growth of Trade Unions and of Co-operative Societies has
taught them habits of self-reliance and of thrift, and has made them
{222} look more closely into the economic conditions of industry.
These unions and societies do not yet embrace all the workmen of
England, but they contain the best and worthiest of them, and their
members are able to preserve a certain independence in treating with
their employers. The power of capital is now opposed by the strength of
united labour, and some of the great strikes of recent years have shown
how great this united strength may be. But the power of labour may
often in such cases degenerate into what readily becomes its weakness;
and in any event, the attitude of mutual distrust and hostility between
employer and employed is one which those who have the best interests of
labour at heart cannot fail to deplore. It is true that the labourer
can look back in his history to times when the power of his employer
was used too selfishly and he himself was miserably oppressed. The
miseries of the early days of the Industrial Revolution, the pauperism
of agricultural labour in the early days of the nineteenth century,
the sad conditions of children’s employment at the beginning of
Queen Victoria’s reign--all these show how the greed of gain has
rendered masters callous to their workpeople’s welfare. But it must be
remembered also that in many cases the workpeople themselves were by
no means always anxious for the improvement of these conditions; and
both masters and men have been slow to recognize the essential identity
of interest, and the equal rights, of Capital and Labour. If the great
principle of mutual interest and co-operation between employer and
employed were more fully acted upon, then the industrial history of our
country would enter upon a new era of well-founded prosperity.
{223}