plight--one who wanders from snow line to sea coast in search of land,
and finds none that is not the property of some one else. Private
property had forgotten this man. On the roads he is a vagrant; off
them he is a trespasser; he is the first disinherited son of Adam,
the first proletarian, one in whose seed all the generations of the
earth shall yet be blest, but who is himself for the present foodless,
homeless, shiftless, superfluous, and everything that turns a man into
a tramp or a thrall. Yet he is still a man with brain and muscle,
able to devise and execute, able to deal puissantly with land if he
only could get access to it. But how to get that access! Necessity is
the mother of Invention. It may be that this second Adam, the first
father of the great proletariat, has one of those scarce brains which
are not the least of Nature’s capricious gifts. If the fertile field
yields rent, why not the fertile brain? Here is the first Adam’s patch
still yielding its £1,000 a year to the labor of the tenant who, as we
have seen, has to pay £900 away in rent. How if the proletarian were
boldly to bid £1,000 a year to that man for the property? Apparently
the result would be the starvation of the proletarian, since he would
have to part with all the produce. But what if the proletarian can
contrive--invent--anticipate a new want--turn the land to some hitherto
undreamt-of use--wrest £1,500 a year from the soil and site that
only yielded £1,000 before? If he can do this, he can pay the full
£1,000 rent, and have an income of £500 left for himself. This is his
profit--the rent of his ability--the excess of its produce over that
of ordinary stupidity. Here then is the opportunity of the cunning
proletarian, the hero of that modern Plutarch, Mr. Samuel Smiles.
Truly, as Napoleon said, the career is open to the talented. But alas!
the social question is no more a question of the fate of the talented
than of the idiotic. In due replenishment of the earth there comes
another proletarian who is no cleverer than other men, and can do as
much, but not more than they. For him there is no rent of ability. How
then is he to get a tenant right? Let us see. It is certain that by
this time not only will the new devices of the renter of ability have
been copied by people incapable of inventing them; but division of
labor, the use of tools and money, and the economies of civilization
will have greatly increased man’s power of extracting wealth from
Nature. All this increase will be so much gain to the holder of a
tenant right, since his rent is a fixed payment out of the produce of
his holding, and the balance is his own. Therefore an addition to the
produce not foreseen by the landlord enriches the tenant. So that it
may well be that the produce of land on the margin of cultivation,
which, as we have seen, fixes the produce left to the cultivators
throughout the whole area, may rise considerably. Suppose the yield to
have doubled; then our old friends who paid £900 rent, and kept £100
for themselves, have now, though they still pay £900 rent, £1,100 for
themselves, the total produce having risen to £2,000. Now here is an
opportunity for our proletarian who is not clever. He can very well
offer to cultivate the land subject to a payment of, for instance,
£1,600 a year, leaving himself £400 a year. This will enable the last
holder of the tenant right to retire as an idle gentleman receiving a
net income of £700 a year, and a gross income of £1,600, out of which
he pays £900 a year rent to a landlord who again pays to the head
landlord £500. But it is to be marked that this £700 a year net is
not economic rent. It is not the difference between the best and the
worst land. It has nothing to do with the margin of cultivation. It is
a payment for the privilege of using land at all--for access to that
which is now a close monopoly; and its amount is regulated, not by what
the purchaser could do for himself on land of his own at the margin,
but simply by the landholder’s eagerness to be idle on the one hand,
and the proletarian’s need of subsistence on the other. In current
economic terms the price is regulated by supply and demand. As the
demand for land intensifies by the advent of fresh proletarians, the
price goes up; and the bargains are made more stringent. Tenant rights,
instead of being granted in perpetuity, and so securing for ever to
the tenant the increase due to unforeseen improvements in production,
are granted on leases for finite terms, at the expiration of which the
landlord can revise the terms or eject the tenant. The payments rise
until the original head rents and quit rents appear insignificant in
comparison with the incomes reaped by the intermediate tenant right
holders or middlemen. Sooner or later the price of tenant right will
rise so high that the actual cultivator will get no more of the produce
than suffices him for subsistence. At that point there is an end of
sub-letting tenant rights. The land’s absorption of the proletarians as
tenants paying more than the economic rent stops.
And now what is the next proletarian to do? For all his forerunners we
have found a way of escape: for him there seems none. The board is at
the door, inscribed “Only standing room left”; and it might well bear
the more poetic legend, _Lasciate ogni speranza, voi ch’ entrate_.
This man, born a proletarian, must die a proletarian, and leave his
destitution as an only inheritance to his son. It is not yet clear
that there is ten days’ life in him; for whence is his subsistence to
come if he cannot get at the land? Food he must have, and clothing;
and both promptly. There is food in the market, and clothing also;
but not for nothing: hard money must be paid for it, and paid on the
nail too; for he who has no property gets no credit. Money then
is a necessity of life; and money can only be procured by selling
commodities. This presents no difficulty to the cultivators of the
land, who can raise commodities by their labor; but the proletarian,
being landless, has neither commodities nor means of producing them.
Sell something he must. Yet he has nothing to sell--except himself.
The idea seems a desperate one; but it proves quite easy to carry out.
The tenant cultivators of the land have not strength enough or time
enough to exhaust the productive capacity of their holdings. If they
could buy men in the market for less than these men’s labor would add
to the produce, then the purchase of such men would be a sheer gain.
It would indeed be only a purchase in form: the men would literally
cost nothing, since they would produce their own price, with a surplus
for the buyer. Never in the history of buying and selling was there
so splendid a bargain for buyers as this. Aladdin’s uncle’s offer of
new lamps for old ones, was in comparison a catch-penny. Accordingly,
the proletarian no sooner offers himself for sale than he finds a rush
of bidders for him, each striving to get the better of the others by
offering to give him more and more of the produce of his labor, and to
content themselves with less and less surplus. But even the highest
bidder must have some surplus, or he will not buy. The proletarian, in
accepting the highest bid, sells himself openly into bondage. He is not
the first man who has done so; for it is evident that his forerunners,
the purchasers of tenant right, had been enslaved by the proprietors
who lived on the rents paid by them. But now all the disguise falls
off; the proletarian renounces not only the fruit of his labor, but
also his right to think for himself and to direct his industry as he
pleases. The economic change is merely formal; the moral change is
enormous. Soon the new direct traffic in men overspreads the whole
market, and takes the place formerly held by the traffic in tenant
rights. In order to understand the consequences, it is necessary to
undertake an analysis of the exchange of commodities in general, since
labor power is now in the market on the same footing as any other ware
exposed there for sale.
EXCHANGE VALUE.
It is evident that the custom of exchange will arise in the first
instance as soon as men give up providing each for his own needs by
his own labor. A man who makes his own tables and chairs, his own poker
and kettle, his own bread and butter, and his own house and clothes,
is jack-of-all-trades and master of none. He finds that he would get
on much faster if he stuck to making tables and chairs, and exchanged
them with the smith for a poker and kettle, with bakers and dairymen
for bread and butter, and with builders and tailors for a house and
clothes. In doing this, he finds that his tables and chairs are worth
so much--that they have an exchange value, as it is called. As a matter
of general convenience, some suitable commodity is set up to measure
this value. We set up gold, which in this particular use of it, is
called money. The chairmaker finds how much money his chairs are worth,
and exchanges them for it. The blacksmith finds out how much money his
pokers are worth, and exchanges them for it. Thus, by employing money
as a go-between, chairmakers can get pokers in exchange for their
chairs, and blacksmiths chairs for their pokers. This is the mechanism
of exchange; and once the values of the commodities are ascertained it
works simply enough. But it is a mere mechanism, and does not fix the
values or explain them. And the attempt to discover what does fix them
is beset with apparent contradictions which block up the right path,
and with seductive coincidences which make the wrong seem the more
promising.
The apparent contradictions soon shew themselves. It is evident that
the exchange value of anything depends on its utility, since no mortal
exertion can make a useless thing exchangeable. And yet fresh air and
sunlight, which are so useful as to be quite indispensable, have no
exchange value; whilst a meteoric stone, shot free of charge from the
firmament into the back garden, has a considerable exchange value,
although it is an eminently dispensable curiosity. We soon find that
this somehow depends on the fact that fresh air is plenty and meteoric
stones scarce. If by any means the supply of fresh air could be
steadily diminished, and the supply of meteoric stones, by celestial
cannonade or otherwise, steadily increased, the fresh air would
presently acquire an exchange value which would gradually rise, whilst
the exchange value of meteoric stones would gradually fall, until at
last fresh air would be supplied through a meter and charged for like
gas, and meteoric stones would be as unsaleable as ordinary pebbles.
The exchange value, in fact, decreases with the supply. This is due to
the fact that the supply decreases in utility as it goes on, because
when people have had some of a commodity, they are partly satisfied,
and do not value the rest so much. The usefulness of a pound of bread
to a man depends on whether he has already eaten some. Every man wants
a certain number of pounds of bread per week, no man wants much more;
and if more is offered he will not give much for it--perhaps not
anything. One umbrella is very useful: a second umbrella is a luxury:
a third is mere lumber. Similarly, the curators of our museums want a
moderate collection of meteoric stones; but they do not want a cartload
apiece of them. Now the exchange value is fixed by the utility, not of
the most useful, but of the least useful part of the stock. Why this
is so can readily be made obvious by an illustration. If the stock of
umbrellas in the market were sufficiently large to provide two for each
umbrella carrier in the community, then, since a second umbrella is
not so useful as the first, the doctrinaire course would be to ticket
half the umbrellas at, say, fifteen shillings, and the other half at
eight and sixpence. Unfortunately, no man will give fifteen shillings
for an article which he can get for eight and sixpence; and when the
public came to buy, they would buy up all the eight and sixpenny
umbrellas. Each person being thus supplied with an umbrella, the
remainder of the stock, though marked fifteen shillings, would be in
the position of second umbrellas, only worth eight and sixpence. This
is how the exchange value of the least useful part of the supply fixes
the exchange value of all the rest. Technically, it occurs by “the law
of indifference.” And since the least useful unit of the supply is
generally that which is last produced, its utility is called the final
utility of the commodity. The utility of the first or most useful unit
is called the total utility of the commodity. If there were but one
umbrella in the world, the exchange value of its total utility would be
what the most delicate person would pay for it on a very wet day sooner
than go without it. But practically, thanks to the law of indifference,
the most delicate person pays no more than the most robust: that
is, both pay alike the exchange value of the utility of the last
umbrella produced--or of the final utility of the whole stock of
umbrellas. These terms--law of indifference, total utility, and final
utility--though admirably expressive and intelligible when you know
beforehand exactly what they mean, are, taken by themselves, failures
in point of lucidity and suggestiveness. Some economists, transferring
from cultivation to utility our old metaphor of the spreading pool,
call final utility “marginal utility.” Either will serve our present
purpose, as I do not intend to use the terms again. The main point to
be grasped is, that however useful any commodity may be, its exchange
value can be run down to nothing by increasing the supply until there
is more of it than is wanted. The excess, being useless and valueless,
is to be had for nothing; and nobody will pay anything for a commodity
as long as plenty of it is to be had for nothing. This is why air
and other indispensable things have no exchange value, whilst scarce
gewgaws fetch immense prices.
These, then, are the conditions which confront man as a producer and
exchanger. If he produces a useless thing, his labor will be wholly
in vain: he will get nothing for it. If he produces a useful thing,
the price he will get for it will depend on how much of it there is
for sale already. If he increases the supply by producing more than is
sufficient to replace the current consumption, he inevitably lowers the
value of the whole. It therefore behooves him to be wary in choosing
his occupation, as well as industrious in pursuing it. His choice will
naturally fall on the production of those commodities whose value
stands highest relatively to the labor required to produce them--which
fetch the highest price in proportion to their cost, in fact. Suppose,
for example, that a maker of musical instruments found that it cost him
exactly as much to make a harp as to make a pianoforte, but that harps
were going out of fashion and pianofortes coming in. Soon there would
be more harps than were wanted, and fewer pianofortes: consequently
the value of harps would fall, and that of pianofortes rise. Since
the labor cost of both would be the same, he would immediately devote
all his labor to pianoforte-making; and other manufacturers would
do the same, until the increase of supply brought down the value of
pianofortes to the value of harps. Possibly fashion then might veer
from pianofortes to American organs, in which case he would make less
pianofortes and more American organs. When these, too, had increased
sufficiently, the exertions of the Salvation Army might create such a
demand for tambourines as to make them worth four times their cost of
production, whereupon there would instantly be a furious concentration
of the instrument-making energy on the manufacture of tambourines; and
this concentration would last until the supply had brought down the
profit[8] to less than might be gained by gratifying the public craving
for trombones. At last, as pianofortes were cheapened until they were
no more profitable than harps; then American organs until they were no
more profitable than pianos; and then tambourines until they were level
with American organs; so eventually trombones will pay no better than
tambourines; and a general level of profit will be attained, indicating
the proportion in which the instruments are wanted by the public. But
to skim off even this level of profit, more of the instruments may be
produced in the ascertained proportion until their prices fall to their
costs of production, when there will be no profit. Here the production
will be decisively checked, since a further supply would cause only
a loss; and men can lose money, without the trouble of producing
commodities, by the simple process of throwing it out of a window.
What occurred with the musical instruments in this illustration occurs
in practice with the whole mass of manufactured commodities. Those
which are scarce, and therefore relatively high in value, tempt us to
produce them until the increase of the supply reduces their value to
a point at which there is no more profit to be made out of them than
out of other commodities. The general level of profit thus attained is
further exploited until the general increase brings down the price of
all commodities to their cost of production, the equivalent of which
is sometimes called their normal value. And here a glance back to our
analysis of the spread of cultivation, and its result in the phenomenon
of rent, suggests the question What does the cost of production of
a commodity mean? We have seen that, owing to the differences in
fertility and advantage of situation between one piece of land and
another, cost of production varies from district to district, being
highest at the margin of cultivation. But we have also seen how the
landlord skims off as economic rent all the advantages gained by the
cultivators of superior soils and sites. Consequently, the addition
of the landlord’s rent to the expenses of production brings them up
even on the best land to the level of those incurred on the worst.
Cost of production, then, means cost of production on the margin of
cultivation, and is equalized to all producers, since what they may
save in labor per commodity is counterbalanced by the greater mass of
commodities they must produce in order to bring in the rent. It is
only by a thorough grasp of this levelling-down action that we can
detect the trick by which the ordinary economist tries to cheat us into
accepting the private property system as practically just. He first
shews that economic rent does not enter into cost of production on the
margin of cultivation. Then he shews that the cost of production on the
margin of cultivation determines the price of a commodity. Therefore,
he argues, first, that rent does not enter into price; and second, that
the value of commodities is fixed by their cost of production, the
implication being that the landlords cost the community nothing, and
that commodities exchange in exact proportion to the labor they cost.
This trivially ingenious way of being disingenuous is officially taught
as political economy in our schools to this day. It will be seen at
once that it is mere thimblerig. So far from commodities exchanging,
or tending to exchange, according to the labor expended in their
production, commodities produced well within the margin of cultivation
will fetch as high a price as commodities produced at the margin with
much greater labor. So far from the landlord costing nothing, he costs
all the difference between the two.
This, however, is not the goal of our analysis of value. We now see
how Man’s control over the value of commodities consists solely in his
power of regulating their supply. Individuals are constantly trying to
decrease supply for their own advantage. Gigantic conspiracies have
been entered into to forestall the world’s wheat and cotton harvests,
so as to force their value to the highest possible point. Cargoes of
East Indian spices have been destroyed by the Dutch as cargoes of
fish are now destroyed in the Thames, to maintain prices by limiting
supply. All rings, trusts, corners, combinations, monopolies and trade
secrets have the same object. Production and the development of the
social instincts are alike hindered by each man’s consciousness that
the more he stints the community the more he benefits himself, the
justification, of course, being that when every man has benefited
himself at the expense of the community, the community will benefit by
every man in it being benefited. From one thing the community is safe.
There will be no permanent conspiracies to reduce values by increasing
supply. All men will cease producing when the value of their product
falls below its cost of production, whether in labor or in labor _plus_
rent. No man will keep on producing bread until it will fetch nothing,
like the sunlight, or until it becomes a nuisance, like the rain in
the summer of 1888. So far, our minds are at ease as to the excessive
increase of commodities voluntarily produced by the labor of man.
WAGES.
I now ask you to pick up the dropped subject of the spread of
cultivation. We had got as far as the appearance in the market of
a new commodity--of the proletarian man compelled to live by the
sale of himself! In order to realize at once the latent horror of
this, you have only to apply our investigation of value, with its
inevitable law that only by restricting the supply of a commodity
can its value be kept from descending finally to zero. The commodity
which the proletarian sells is one over the production of which he
has practically no control. He is himself driven to produce it by an
irresistible impulse. It was the increase of population that spread
cultivation and civilization from the centre to the snowline, and at
last forced men to sell themselves to the lords of the soil: it is the
same force that continues to multiply men so that their exchange falls
slowly and surely until it disappears altogether--until even black
chattel slaves are released as not worth keeping in a land where men
of all colors are to be had for nothing. This is the condition of our
English laborers to-day: they are no longer even dirt cheap: they are
valueless, and can be had for nothing. The proof is the existence of
the unemployed, who can find no purchasers. By the law of indifference,
nobody will buy men at a price when he can obtain equally serviceable
men for nothing. What, then, is the explanation of the wages given to
those who are in employment, and who certainly do not work for nothing?
The matter is deplorably simple. Suppose that horses multiplied in
England in such quantities that they were to be had for the asking,
like kittens condemned to the bucket. You would still have to feed
your horse--feed him and lodge him well if you used him as a smart
hunter--feed him and lodge him wretchedly if you used him only as a
drudge. But the cost of keeping would not mean that the horse had an
exchange value. If you got him for nothing in the first instance--if
no one would give you anything for him when you were done with him,
he would be worth nothing, in spite of the cost of his keep. That is
just the case of every member of the proletariat who could be replaced
by one of the unemployed to-day. Their wage is not the price of
themselves; for they are worth nothing: it is only their keep. For bare
subsistence wages you can get as much common labor as you want, and do
what you please with it within the limits of a criminal code which is
sure to be interpreted by a proprietary-class judge in your favor. If
you have to give your footman a better allowance than your wretched
hewer of match wood, it is for the same reason that you have to give
your hunter beans and a clean stall instead of chopped straw and a
sty.[9]
CAPITALISM.
At this stage the acquisition of labor becomes a mere question of
provender. If a railway is required, all that is necessary is to
provide subsistence for a sufficient number of laborers to construct
it. If, for example, the railway requires the labor of a thousand
men for five years, the cost to the proprietors of the site is the
subsistence of a thousand men for five years. This subsistence is
technically called capital. It is provided for by the proprietors not
consuming the whole excess over wages of the produce of the labor of
their other wage workers, but setting aside enough for the subsistence
of the railway makers. In this way capital can claim to be the result
of saving, or, as one ingenious apologist neatly put it, the reward of
abstinence, a gleam of humor which still enlivens treatises on capital.
The savers, it need hardly be said, are those who have more money than
they want to spend: the abstainers are those who have less. At the
end of the five years, the completed railway is the property of the
capitalists; and the railway makers fall back into the labor market
as helpless as they were before. Sometimes the proprietors call the
completed railway their capital; but, strictly, this is only a figure
of speech. Capital is simply spare subsistence. Its market value,
indicated by the current rate of interest, falls with the increase of
population, whereas the market value of established stock rises with
it.[10] If Mr. Goschen, encouraged by his success in reducing Consols,
were to ask the proprietors of the London and North Western Railway to
accept as full compensation for their complete expropriation capital
just sufficient to make the railway anew, their amazement at his
audacity would at once make him feel the difference between a railway
and capital. Colloquially, one property with a farm on it is said to
be land yielding rent; whilst another, with a railway on it, is called
capital yielding interest. But economically there is no distinction
between them when they once become sources of revenue. This would
be quite clearly seen if costly enterprises like railways could be
undertaken by a single landlord on his own land out of his own surplus
wealth. It is the necessity of combining a number of possessors of
surplus wealth, and devising a financial machinery for apportioning
their shares in the produce to their shares in the capital contributed,
that modifies the terminology and external aspect of the exploitation.
But the modification is not an alteration: shareholder and landlord
live alike on the produce extracted from their property by the labor of
the proletariat.
“OVERPOPULATION.”