SOCIALISM AND THE SOCIAL QUESTION.
The renewal of the socialist agitation has not been unproductive of
advantage, for it has led to a general recognition that the economic
position of the people is far from satisfactory and is not free from
peril, and that industrial development, on the lines on which it has
hitherto been running, offers much less prospect than was at one time
believed of effecting any substantial, steady, and progressive
improvement in their condition. It is only too manifest that the immense
increase of wealth which has marked the present century has been
attended with surprisingly little amelioration in the general lot of the
people, and it is in no way remarkable that this fact should tend to
dishearten the labouring classes, and fill reflecting minds with serious
concern. Under the influence of this experience economists of the
present day meet socialism in a very different way from Bastiat and the
economists of 1848. They entertain no longer the same absolute
confidence in the purely beneficent character of the operation of the
principles at present guiding the process of industrial evolution, or in
the sovereign virtue of competition, unassisted and unconnected, as an
agency for the distribution as well as the production of wealth; and
they no longer declare that there is not and cannot possibly be a social
question. On the contrary, some of them take almost as unfavourable a
view of the road we are on as the socialists themselves. Mr. Cairnes,
one of the very ablest of them, says: "The fund available for those who
live by labour tends, in the progress of society, while growing actually
larger, to become a constantly smaller fraction of the entire national
wealth. If, then, the means of any one class of society are to be
permanently limited to this fund, it is evident, assuming that the
progress of its members keeps pace with that of other classes, that its
material condition in relation to theirs cannot but decline. Now, as it
would be futile to expect, on the part of the poorest and most ignorant
of the population, self-denial and prudence greater than that actually
practised by the classes above them, the circumstances of whose life are
so much more favourable than theirs for the cultivation of these
virtues, the conclusion to which I am brought is this, that unequal as
is the distribution of wealth already in this country, the tendency of
industrial progress--on the supposition that the present separation
between industrial classes is maintained--is towards an inequality
greater still. The rich will be growing richer; and the poor, at least
relatively, poorer. It seems to me, apart altogether from the question
of the labourer's interest, that these are not conditions which furnish
a solid basis for a progressive social state; but having regard to that
interest, I think the considerations adduced show that the first and
indispensable step towards any serious amendment of the labourer's lot
is that he should be, in one way or other, lifted out of the groove in
which he at present works, and placed in a position compatible with his
becoming a sharer in equal proportion with others in the general
advantages arising from industrial progress." ("Leading Principles," p.
340.) He thinks it beyond question that the condition of the labouring
population is not so linked to the progress of industrial improvements
that we may count on it rising _pari passu_ with that progress; because,
in the first place, the labourer can only benefit from industrial
inventions which cheapen commodities that enter into his expenditure,
and the bulk of his expenditure is on agricultural products, which are
prevented from being cheapened by the increase of population always
increasing the demand for them; and, second, the labourer is practically
more and more divorced from the control of capital, and reduced to the
position of a recipient of wages, and there is no tendency in wages to
grow _pari passu_ with the growth of wealth, because the demand for
labour, on which, in the last analysis, the rate of wages depends, is
always in an increasing degree supplied by inventions which dispense
with labour. He is thus debarred from participating in the advantages of
industrial progress either as consumer or as producer: as consumer, by
over-population; as producer, by his divorce from capital. Mr. Cairnes,
like most economists, differs from socialists in thinking that the first
requisite for any material improvement in the condition of the labouring
classes lies in effective restraints on population, but he says that
"even a very great change in the habits of the labouring classes as
bearing upon the increase of population--a change far greater than there
seems any solid ground for expecting--would be ineffectual, so long as
the labourer remains a mere receiver of wages, to accomplish any great
improvement in his state; any improvement at all commensurate with what
has taken place and may be expected hereafter to take place in the lot
of those who derive their livelihood from the profits of capital" (p.
335). Here he is entirely at one with socialists in believing that the
only surety for a sound industrial progress lies in checking the further
growth of capitalism by the encouragement of co-operative production,
which, by furnishing the labouring classes with a share in the one fund
that grows with the growth of wealth, the fund of capital, offers them
"the sole means of escape from a harsh and hopeless destiny" (p. 338).
Mr. Cairnes, then, agrees with the socialists in declaring that the
position of the wage-labourer is becoming less and less securely linked
with the progressive improvement of society, and that the only hope of
the labourer's future lies in his becoming a capitalist by virtue of
co-operation; only, of course, he is completely at issue with them in
regard to the means by which this change is to be effected, believing
that its introduction by the direct intervention of the State would be
unnecessary, ineffectual, and pernicious.
I am disposed to think that Mr. Cairnes takes too despondent a view of
the possibilities of progress that are comprised in the position of the
wage-labourer, but it is precisely that view that has lent force to the
socialist criticism of the present order of things, and to the socialist
calls for a radical transformation by State agency. The main charges
brought by socialists against the existing economy are the three
following, all of which, they allege, are consequences of the
capitalistic management of industry and unregulated competition:--1st,
that it tends to reduce wages to the minimum required to give the
labourer his daily bread, and that it tends to prevent them from rising
above that minimum; 2nd, that it has subjected the labourer's life to
innumerable vicissitudes, made trade insecure, mutable and oscillatory,
and created relative over-population; and, 3rd, that it enables and even
forces the capitalist to rob the labourer of the whole increase of value
which is the fruit of his labour. These are the three great heads of
their philippic against modern society: the hopeless oppression of the
"iron and cruel law" of necessary wages, the mischief of incessant
crises and changes and of the chaotic _regime_ of chance, and the
iniquity of capital in the light of their doctrine of value. Let us
examine them in their order.
I. Socialists found their first charge partly on their interpretation of
the actual historical tendency of things, and partly on the teaching of
Ricardo and other economists on natural wages. Now, to begin with the
question of historical fact, the effect which has been produced by the
large system of production on the distribution of wealth and the general
condition of the working class is greatly misconceived by them. So far
as the distribution of wealth is concerned, the principal difference
that has occurred may be described as the decadence of the lower middle
classes, a decline both in the number of persons in proportion to
population who enjoy intermediate incomes, and also in the relative
amount of the average income they enjoy. Their individual income may be
higher than that of the corresponding class 150 or 200 years ago, but it
bears a less ratio to the average income of the nation. The reason of
this decline is, of course, obvious. The yeomanry, once a seventh of our
population, and the small masters in trade have gradually given way
before the economic superiority of the large capital or other causes,
and modern industry has as yet produced no other class that can, by
position and numbers, fill their room; for though, no doubt, the great
industries call into being auxiliary industries of various kinds, which
are still best managed on the small scale by independent tradesmen, the
number of middling incomes which the greater industries have thus
contributed to create has been far short of the number they have
extinguished. The same causes have, of course, exercised very important
effects on the economic condition of the working class. They have
reduced them more and more to the permanent position of wage-labourers,
and have left them relatively fewer openings than they once possessed
for investing their savings in their own line, and fewer opportunities
for the abler and more intelligent of them to rise to a competency. This
want may perhaps be ultimately supplied under existing industrial
conditions by the modern system of co-operation, which combines some of
the advantages of the small capital with some of the advantages of the
large, though it lacks one of the chief advantages of both, the
energetic, uncontrolled initiative of the individual capitalist. But at
present, at any rate, it is premature to expect this, and as things
stand, many of the old pathways that linked class with class are now
closed without being replaced by modern substitutes, and working men are
more purely and permanently wage-labourers than they used to be. But
while the wage-labourer has perhaps less chance than before of becoming
anything else, it is a mistake to suppose, as is sometimes done, that he
is worse off, or even, as is perhaps invariably imagined, that he has a
less share in the wealth of the country than he had when the wealth of
the country was less. On the contrary, the position of the wage-labourer
is really better than it has been for three hundred years. If we turn to
the period of the English Revolution, we find that the income which the
labourer and his family together were able to earn was habitually
insufficient to maintain them in the way they were accustomed to live.
Sir M. Hale, in his "Discourse Touching the Poor," published in 1683,
says the family of a working man, consisting of husband, wife, and four
children, could not be supported in meat, drink, clothing, and
house-rent on less than 10s. a week, and that he might possibly be able
to make that amount, if he got constant employment, and if two of his
children, as well as their mother, could earn something by their labour
too. Gregory King classifies the whole labouring population of the
country in his time, except a few thousand skilled artisans, among the
classes who decrease the wealth of the country, because, not earning
enough to keep them, they had to obtain occasional allowances from
public funds. We do well to grieve over the pauperism that exists now
in England. A few years ago, one person in every twenty received
parochial support, and one in thirty does so yet. These figures, of
course, refer to those in receipt of relief at one time, and not to all
who received relief during a year. But for Scotland we have statistics
of both, and the latter come as nearly as possible to twice as many as
the former. If the same proportion rules in England, then every
fifteenth person receives relief in the course of the year.[4] But in
King's time, out of a population of five millions and a half, 600,000
were in receipt of alms, _i.e._, more than one in ten; and if their
children under 16 years of age were included, their number would amount
to 900,000, or one in six. Now, while the labourers' wages were then, as
a rule, unequal to maintain them in the way they lived, we know that
their scale of living was much below that which is common among their
class to-day. The only thing which was much cheaper then than now was
butcher meat, mutton being only 2d. a lb., and beef, 11/4d.; but half the
population had meat only twice a week, and a fourth only once. The
labourer lived chiefly on bread and beer, and bread was as dear as it is
now. Potatoes had not come into general use. Butter and milk were
cheaper than now, but were not used to the same extent. Fuel, light, and
clothing were all much dearer, and salt was so much so as to form an
appreciable element in the weekly bill. When so many of the staple
necessaries of life were high in price, the labourer's wages naturally
could not afford a meat diet. Nothing can furnish a more decisive proof
of the rise in the real remuneration of the wage-labourer since the
Revolution than the fact that the wages of that period were insufficient
to maintain the lower standard of comfort prevalent then, without
parochial aid, while the wages of the same classes to-day are generally
able to maintain their higher standard of comfort without such
supplementary assistance. Then the hours of labour were, on the whole,
longer; the death rate in London was 1 in 27, in place of 1 in 40 now;
and all those general advantages of advancing civilization, which are
the heritage of all, were either absent or much inferior.
These facts sufficiently show that if the rich have got richer since the
Revolution, the poor have not got poorer, and that the circumstances of
the labouring class have substantially improved with the growth of
national wealth. As far as their mere money income is concerned there is
some reason for thinking that the improvement has been as near as may be
proportional with the increase of wealth. The general impression is the
reverse of this. It is usual to hear it said that while the labourers'
circumstances have undoubtedly improved absolutely, they have not
improved relatively, as compared with the progress in the wealth of the
country and the share of it which other classes have succeeded in
obtaining. But this impression must be qualified, if not entirely
rejected, on closer examination. Data exist by which it can be to some
extent tested, and these data show that while considerable alterations
have been made in the distribution of wealth since the rise of the great
industries, these alterations have not been unfavourable to the
labouring classes, but that the proportion of the wealth of the country
which falls to the working man to-day is very much the same--is indeed
rather better than worse--than the proportion which fell to his share
two hundred years ago. Gregory King made an estimate of the distribution
of wealth among the various classes of society in England in 1688,
founded partly on the poll-books, hearth-books, and other official
statistical records, and partly on personal observation and inquiry in
the several towns and counties of England; and Dr. C. Davenant, who says
he had carefully examined King's statistics himself, checking them by
calculations of his own and by the schemes of other persons, pronounces
them to be "very accurate and more perhaps to be relied on than anything
that has been ever done of a like kind." Now, a comparison of King's
figures with the estimate of the distribution of the national income
made by Mr. Dudley Baxter from the returns of 1867, will afford some
sort of idea--though of course only approximately, and perhaps not very
closely so--of the changes that have actually occurred. King takes the
family income as the unit of his calculations. Baxter, on the other
hand, specifies all bread-winners separately--men, women, and children;
but to furnish a basis of comparison, let us take the men as
representing a family each, and if so, that would give us 4,006,260
working-class families in the country in 1867. This is certainly a high
estimate of their number, because in 1871 there were only five million
of families in England; and according to the calculations of Professor
Leone Levi, the working class comprises no more than two-thirds of the
population, and would consequently consist in 1871 of no more than
3,300,000 families. If we were to take this figure as the ground of our
calculations, the result would be still more striking; but let us take
the number of working-class families to have been four millions in 1867.
The average income of a working-class family in King's time was L12 12s.
(including his artisan and handicraft families along with the other
labourers); the average income of a working class family now is L81. The
average income of English families generally in King's time was L32; the
average income of English families generally now is L162. The average
income of the country has thus increased five-fold, while the average
income of the working class has increased six and a half times. The
ratio of the working class income to the general income stood in King's
time as 1:21/2, and now as 1:2. In 1688, 74 per cent. of the whole
population belonged to the working class, and they earned collectively
26 per cent. of the entire income of the country; in 1867--according to
the basis we have adopted, though the proportion is doubtless really
less--80 per cent. of the whole population belonged to the working
class, and they earned collectively 40 per cent. of the entire income of
the country. Their share of the population has increased 6 per cent.;
their share of the income 14 per cent.
Now, I am far from adducing these considerations with the view of
suggesting that the present condition of the working classes or the
present distribution of wealth is even approximately satisfactory, but I
think they ought to be sufficient to disperse the gloomy apprehensions
which trouble many minds as if, with all our national prosperity, the
condition of the poorer classes were growing ever worse and could not
possibly, under existing industrial conditions, grow any better; to
prevent us from prematurely condemning a system of society, whose
possibilities for answering the legitimate aspirations of the working
class are so far from being exhausted, that it may rather be said that a
real beginning has hardly as yet been made to accomplish them; and to
give ground for the hope that the existing economy, which all admit to
be a most efficient instrument for the production of wealth, may, by
wise correction and management, be made a not inadequate agency for its
distribution.
The socialists are not more fortunate in their argument from the
teaching of economists than in their account of the actual facts and
tendency of history. The "iron and cruel law" of necessary wages is, as
expounded by economists, neither so iron nor so cruel as Lassalle
represented it to be. They taught that the price of labour, like the
price of everything else, tended to settle at the level of the relative
cost of its production, and that the cost of its production meant the
cost of producing the subsistence required to maintain the labourer in
working vigour and to rear his family to continue the work of society
after his day; but they always represented this as a minimum below which
wages would not permanently settle, but above which they might from
other causes remain for a continuity considerably elevated, and which,
even as a minimum, was in an essential way ruled by the consent of the
labouring classes themselves, and dependent on the standard of living
they chose habitually to adopt. If the rate of wages were forced down
below the amount necessary to maintain that customary standard of
living, the marriage rate of the labouring classes would tend to fall
and the rate of mortality to rise till the supply of labour diminished
sufficiently to restore the rate of wages to its old level. And
conversely, if the price of labour rose above that limit, the marriage
rate among the labouring class would tend to rise and the rate of
mortality to fall, till the numbers of the working population increased
to such an extent as to bring it down again. But the rate of marriage
depended on the will and consent of the labouring class, and their
consent was supposed to be given or withheld according as they
themselves considered the current wages sufficient or insufficient to
support a family upon. The amount of the labourer's "necessary"
subsistence was never thought to be a hard and fast limit inflexibly
fixed by physical conditions. It was not a bare living; it was the
living which had become customary or was considered necessary by the
labourer. Its amount might be permanently raised, if in consequence of a
durable rise of wages a higher standard of comfort came to be habitual
and to be counted essential, and the addition so made to it would then
become as real an element of natural or necessary wages in the economic
sense as the rest. Its amount might also permanently fall, if the
labourers ceased to think it necessary and contentedly accommodated
their habits to the reduced standard, and there might thus ensue a
permanent degradation of the labourer, such as took place in Ireland in
the present century, when the labouring class adjusted themselves to
reduction after reduction till their lower standard of living served, in
the first place, to operate as an inducement to marriage instead of a
check on it, because marriage could not make things worse, and at least
lightened the burdens of life by the sympathy that shared them; and
served, in the second place, to impair the industrial efficiency of the
labourer till he was hardly worth better wages if he could have got
them. So far then was the doctrine of economists from involving any
"iron or cruel" limit that they always drew from it the lesson that it
was in the power of the labouring classes to elevate themselves by the
pleasant, if somewhat paradoxical, expedient of first enlarging their
scale of expenditure. "Pitch your standard of comfort high, and your
income will look after itself," is scarcely an unfair description of the
rule of prudent imprudence they inculcated on working people. They
believed that the chief danger to which that class was exposed was their
own excessive and too rapid multiplication, and they considered the best
protection against this danger to lie in the powerful preventive of a
high scale of habitual requirements.
Moreover, Ricardo distinctly maintained that though the natural rate of
wages was determined as he had explained, yet the operation of that
natural law might be practically suspended in a progressive community
for an indefinite period, and that the rate of wages actually given
might even keep on advancing the whole time, because capital was capable
of increasing much more rapidly than population. The price of labour, he
taught, would in that case be always settled by the demand for it which
was created by the accumulation of capital, and the sole condition of
the accumulation of capital was the productive power of labour. The rate
of wages in a progressive community might therefore almost never be in
actual fact determined by this "iron and cruel law" at all, and so there
is not the smallest ground for representing economists as teaching that
the present system compels the rate of wages or the labourer's
remuneration to hover to and fro over the margin of indigence.
Lassalle, then, built his agitation on a combination of errors. He was
wrong in his interpretation of the tendency of actual historical
development; he was wrong in his interpretation of the doctrine of
economists; and now, to complete the confusion, that doctrine is itself
wrong. If we are at all to distinguish a natural or normal rate of wages
from the fluctuating rates of the market, that natural or normal rate
will be found really to depend, not on the cost of producing
subsistence, but on the amount or rate of general production, or the
amount of production _per capita_ in the community, or, in other words,
on the average productivity of labour. It is manifest that this would be
so in a primitive condition of society in which industry was as yet
conducted without the intervention of a special employing class, for
then the wages of labour would consist of its product, and be, in fact,
as Smith says, only another name for it. It would depend, however, not
exclusively on the individual labourer's own efficiency, but also on the
fertility of the soil and the general efficiency of the rest of the
labouring community. While according to his own efficiency he would
possess a greater or smaller stock of articles, which, after providing
for his own wants, he might exchange for other articles produced by his
neighbours; the quantity he would get in exchange for them would be
great or small according to the degree of his neighbour's efficiency.
The average real remuneration of labour, or the average rate of wages,
in such a community would therefore correspond with the average
productivity of its labour. But the same principle holds good in the
more complex organization of industrial society that now exists, though
its operation is more difficult to trace.
The price of labour is now determined by a struggle between the
labourer and the employer, and the fortunes of the struggle move between
two very real, if not very definitely marked, limits, the lower of which
is constituted by the smallest amount which the labourer can afford to
take, and the higher by the largest amount which the employer can afford
to give. The former is determined by the amount necessary to support
life, and the latter by the amount necessary to secure an adequate
profit. Now the space between these two limits will be always great or
small in proportion to the general productivity of labour in the
community. The general productivity of labour acts upon the rate of
wages in two ways, immediately and mediately. Immediately, because, as
is manifest, efficient labour is worth more to the employer than
inefficient; and mediately, as I shall presently show, because it
conduces to a greater diversion of wealth for productive purposes, and
so increases the general demand for labour. In modern society, as in
primitive, the labourer not only obtains a higher remuneration if he is
efficient himself, but gathers a higher remuneration from the efficiency
of his neighbours.
This will be obvious at once to any one who reflects on the improved
remuneration of the common unskilled labourers. The man who works with
pick and shovel makes, according to Mr. Mulhall's estimate, L30 a year
now, while he only made L12 a year in 1800, when bread was about twice
as dear, and yet he probably did quite as good a day's work then as he
does now, except so far as his better wages have themselves helped his
powers of labour, through affording him a more liberal diet, and in that
case the same question is raised, How did he come to get these better
wages? It was not on account of an increase in his own production, for
that was the effect, not the cause; it was on account of the general
increase in the productivity of all labour round about him. The great
improvement in industrial processes have brought in more plentiful
times, and he shares in the general plenty, though he may not have
directly contributed to its production. He gets more for the same work,
not merely because people in general, with their larger surplus, can
afford to give him more, but because, having more to devote to
industrial investment, they increase the demand for labour till they are
obliged to give him more.
The proximate demand for labour is, of course, capital, but the amount
of capital which a community tends to possess--in other words, the
amount of wealth it tends to detach for industrial investment--bears a
constant relation to the amount of its general production. There is a
disposition among economists to speak of the quantity of a nation's
savings, as if it was something given and complete that springs up
independently of industrial conditions, and as irrespectively of the
purpose to which it is to be applied as the number of eggs a fowl lays
or the amount of fruit a tree bears. But, in reality, it is not so. The
amount of a nation's savings is no affair of chance; it is governed much
more by commercial reasons than is sometimes supposed. It is no
sufficient account of the matter to say that men save because they have
a disposition to save, because there is a strong cumulative propensity
in the national character. They save because they think to get a profit
by saving, and the point at which the nation stops saving is the point
at which this expectation ceases to be gratified, the point at which
enough has been accumulated to occupy the entire field of profitable
investment which the community offers at the time. Some part of a
nation's savings will always have originated in a desire to provide
security for the future, but, as this part is less subject to
fluctuation, it exercises less influence in determining the extent of
the whole than the more variable part, which is only saved when there is
sufficient hope of gain from investing it. There may be said to be a
natural amount of capital in a country, in at least as true a sense as
there is a natural price of labour, or a natural price of commodities.
Capital has its bounds in the general industrial conditions and stature
of the community, but it moves and answers these conditions with much
more elasticity than the wage-fund theory used to acknowledge. It is, as
Hermann said, a mere medium of conveyance between consumer and consumer,
and has its size decreed for it by the quantities it has to convey. The
general demand for commodities is a demand for capital. It creates the
expectation of profit which capital is diverted from expenditure to
gratify, and since it is itself in another aspect the general supply of
commodities, it furnishes the possibilities for meeting the demand for
capital which it creates. This whole argument may seem to be reasoning
in a circle or wheeling round a pivot, and so in a sense it may be, for
the wheel of industry is circular. The rate of wages depends on the
demand for labour; the demand for labour depends on the amount of
capital; the amount of capital depends on the aggregate production of
and demand for commodities; and the amount of aggregate production
depends on the average productivity of labour. It is but a more
circuitous way of saying the same thing as the older economists said,
when they declared the rate of wages to depend on the supply of capital,
as compared with population; but it shows that the supply of capital is
a more elastic element than they conceived, that it adjusts and
re-adjusts itself more easily and sensitively to industrial conditions,
including perhaps even those of population, and that it is governed in a
very real way by the great primary factor that determines the whole size
and scale of the industrial system in all its parts, the general
productivity of labour. Taking one country with another, the rate of
wages will be found to observe a certain proportion to the amount of
production _per capita_ in the community.
This view will be confirmed by a comparison of the actual rate of wages
prevalent in different countries. Lord Brassey has published an
important body of positive evidence tending to show that the cost of
labour is the same all over the world, that for the same wages you get
everywhere the same work, and that the higher price of labour in some
countries than in others is simply due to its higher efficiency. Mr.
Cairnes, who did not accept this conclusion unconditionally, had,
however, himself previously estimated that a day's labour in America
produced as much as a day and a third's in Great Britain, to a day and a
half's in Belgium, a day and three-fourths' or two days' in France and
Germany, and to five days' labour in India. Now, when due regard is had
for the influence of special historical circumstances, it will be found
that the rate of wages observes very similar proportions in these
several countries. In America it is higher than the relative
productivity of the country would explain, because a new country with
boundless natural resources creates a permanently exceptional demand for
labour; because the facilities with which land can be acquired and
wrought, even by men without previous agricultural training, affords a
ready correction to temporary redundancies of labour; and because the
labour itself is more mobile, versatile, and energetic in a nation
largely composed of immigrants. Other modifying influences also
interfere to preclude the possibility of a precise correspondence
between national rates of wages and national amounts of production _per
capita_, for different countries vary much in the extent of the fixed
capital they employ to economize personal labour. But enough has been
said to show that, if a natural rate of wages is to be sought at all, it
must be looked for, not in the cost of the production of subsistence,
but in the rate of the production of commodities; and while the standard
of living and the price of labour tend to some extent to keep one
another up, the higher standard of living prevalent among labourers in
some countries is a consequence much more than a condition of the higher
rate of wages, which the higher productivity of labour in those
countries occasions.
There is therefore no ground for Lassalle's representation that the law
of necessary wages condemns ninety-six persons in every hundred to an
existence of hopeless misery to enable the other four to ride in luxury.
The principles that govern the rate of wages are much more flexible than
he supposed, and the experience of trade unions has sufficiently
demonstrated that it is within the power of the wage-labourers
themselves to effect by combination a material increase in the price of
their labour. Trade unions have taken away the shadow of despondency
that lay over the hired labourer's lot. Their margin of effective
operation is strictly limited; still such a margin exists, and they have
turned it to account. They have put the labourer in a position to hold
out for his price; they have converted the question of wages from the
question, how little the labourer can afford to take, into the question,
how much the employer can afford to give. They have been able, in trades
not subject to foreign competition, to effect a permanent rise in wages
at the expense of prices, and they can probably, in all trades, succeed
in keeping the rate of wages well up to its superior limit, viz., to the
point at which, while the skilful employers might still afford to give
more, the unskilful could not do so without ceasing to conduct a
profitable business and being driven out of the field altogether. For
unskilful management tells as ill on wages as inefficient labour. On the
other hand, high wages, like many other difficult conditions,
undoubtedly tend to develop skilful management. The employer is put on
his mettle, and all his administrative resource is called into action
and keen play. They who, like socialists, inveigh against this modern
despot, ought to reflect how much less possible it would have been for
wages to have risen, if industry had been in the hands of hired managers
who were not put to their mettle, because they had no personal stake in
the result. It must not be forgotten, however, that while trade unions
are able to keep the rate of wages up to its superior limit, they have
no power to raise that limit itself. This can only be done by an
increase in the general productivity of labour, and, in fact, the action
of trade unions could not have been so effective as it has been, unless
the high production of the country afforded them the conditions for
success. And since, in consequence of their action and vigilance, the
rate of wages in the trades they represent may be now taken as usually
standing close to its superior limit, the chief hope of any further
substantial improvement in the future must now be placed in the
possibility of raising that limit by an increased productivity.
Of this the prospect is really considerable and promising. Of course
labourers will never benefit to the full from improvements in the
productive arts, until by some arrangement, or by many arrangements,
they are made sharers in industrial capital; but they will benefit from
these improvements, though in less measure, even as pure wage-labourers.
Their unions will be on the watch to prevent the whole advantage of the
improvement from going towards a reduction of the price of the commodity
they produce, and such reduction in the price of the commodity as
actually takes place will enable its consumers to spend so much the more
of their means on commodities made by other labourers, and to that
extent to increase the demand for the labour of the latter. But the
field from which I expect the most direct and extensive harvest to the
working class is the development of their own personal efficiency. At
present neither employers nor labourers seem fully alive to the
resources which this field is capable of yielding, if it were wisely and
fairly cultivated. Both classes are often so bent on immediate advantage
that they lose sight of their real and enduring interest. It is doubtful
whether employers are more slow to see how much inadequate remuneration
and uncomfortable circumstances impair efficiency and retard production,
or labourers to perceive how much limiting the general rate of
production tends to reduce the general rate of wages. In labour
requiring mainly physical strength, contractors sufficiently appreciate
the fact that their navvies must be well fed if they are to stand to
their work, and that an extra shilling a day makes a material difference
in the output. But in all forms of skilled labour, likewise, analogous
conditions prevail. Just as slave-labour is inefficient because it is
reluctantly given, and is wanting in the versatility and resourcefulness
that comes from general intelligence, so is free labour less efficient
or more efficient in exact proportion to its fertility of resource and
to the hopefulness and cheerfulness with which it is exerted; and both
conditions are developed in the working class in precise ratio with
their general comfort. The intelligent workman takes less time to learn
his trade, needs less superintendence at his work, and is less wasteful
of materials; and the cheerful workman, besides these merits, expends
more energy with less exhaustion. But men can have no hope in their work
while they live purely from hand to mouth, and you cannot spread habits
of intelligence among the labouring class, if their means are too poor
or their leisure too short to enable them to participate in the culture
that is going on around them.
But if employers are apt to take too narrow a view of the worth of good
wages as a positive source of high production, labourers are apt to take
equally narrow views of the worth of high production as a source of good
wages. The policy of limiting production is expressly countenanced by a
few of their trade unions, with the concurrence, I fear, of a
considerable body of working-class opinion. This is shown in their idea
of "making work," in their prohibition of "chasing"--_i.e._, of a
workman exceeding a given average standard of production--and in their
prejudice against piecework. Their notion of making work is irrational.
They think they can make work by simply not doing it, by spinning it
out, by going half speed, under the impression that they are in this way
leaving the more over to constitute a demand for their labour to-morrow.
And so, in the immediate case in hand and for the particular time, it
may sometimes be. But if this practice were to be turned into a law
universal among working men, if all labourers were to act upon it
everywhere, then the general production of the country would be
immediately reduced, and the general demand for labour, and the rate of
wages, would inevitably fall in a corresponding degree. Instead of
making work, they would have unmade half the work there used to be, and
have brought their whole class to comparative poverty by contracting the
ultimate sources from which wages come. The true way to make work for
to-morrow is to do as much as one can to-day. For the produce of one
man's labour is the demand for the produce of another man's. There is
nothing more difficult for any class than to reach an enlightened
perception of its own general interest.
The objection usually made to "chasing" and piecework is that they
always end in enabling employers to extract more work out of the men
without giving them any more pay, and that they conduce to
overstraining. Now piecework, without a fixed list of prices, is of
course liable to the abuse which, it is alleged, masters have made of
it. But with a fixed list of prices the labourers ought, with the aid of
their unions, to be as able to hold their own against the encroachments
of the masters under piecework as under day work, and piecework is so
decidedly advantageous, both to masters and to men, that it would be
foolish for the former to refuse the reasonable concession of a fixed
list of prices; and it would be equally foolish for the latter to oppose
the system under the delusive fear of a danger which it is amply in
their own power to meet. There is a good deal of force in the view of
Mr. William Denny, that piecework will prove the best and most natural
transition from the present system to a _regime_ of co-operative
production, because it furnishes many kinds of actual opportunities for
practising co-operation; but whatever may be the promise of piecework
for the age that is to come, there is no question about its promise for
the life that now is. Mr. Denny, speaking from experience in his own
extensive shipbuilding works at Dumbarton, says that "a workman under
piecework generally increases his output in the long run--partly by
working hard, but principally by exercising more intelligence and
arranging his work better--by about 75 per cent., while the total amount
of his wages increases by about 50 per cent., making a distinct saving
in the wages portion of the cost of a given article of about 14 per
cent." ("The Worth of Wages," p. 19.)[5] Similar testimony is given by
Goltz, Boehmert, and a writer in Engels' _Zeitschrift_ for 1868, as to
the effect of the introduction of piecework into continental industries,
and Roscher ascribes much of the industrial superiority of England to
the prevalence of piecework here. According to Mr. Howell, more than
seventy per cent. of the work of this country is done at present by the
piece, and the Trades' Union Commission found it the accepted rule in
the majority of the industries that came under their investigation; in
fact, in all except engineering, ironfounding, and some of the building
trades. The engineers entertain a strong objection to it, and their
union has sometimes expelled members who have persisted in taking it.
But the system works smoothly enough when an established price-list has
become a recognised practice of the trade. The objection that the piece
system leads to careless, scamped and inferior work, call hardly be
considered a genuine working-class objection. That is the look-out of
the masters, and they find it easier to check quality than to check
quantity. Another reason sometimes given against piecework is that under
it some men get more than their share in the common stock of work, but
there lurks in this reason the same fallacy which lies in the notion of
"making work," the fallacy of seeking to raise the level of wages by
limiting production, and so diminishing the common stock of work of
society. Labourers seem sometimes to harbour an impression as if they
were losing something when their neighbours were making more than
themselves. Work appears to them--no doubt in consequence of the
fluctuations and intermittent activity of modern trade--to come in
bursts and windfalls, nobody knows whence or how, and they are sometimes
uneasy to see the harvest being apparently disproportionately
appropriated by more active and efficient hands. But in the end, and as
a steady general rule, they are gainers and not losers by the efficiency
of the more expert workmen, because productivity, so far from drying up
the sources of work, is the very thing that sets them loose.
A more important objection is the danger of overstraining, against which
of course the working class are wise to exercise a most jealous
vigilance. But, in the first place, it is easy to exaggerate this
danger. It is not really from any deepened drain on the physical powers
of the workmen, so much as from a quickening of his mental life in his
work, that increase in his productivity is to be expected. Mr. Denny, it
will be observed, attributes the additional output under piecework not
nearly so much to harder labour as to the exercise of more intelligence
and to a better arrangement of the work. But, in the next place, to my
mind the great advantage of piecework is that it affords a sound
economic reason for shortening the day of labour. The work being
intenser, demands a shorter day, and being more productive, justifies
it. If the figures I have quoted from Mr. Denny are at all
representative, then a labourer, working by the piece, can turn out 40
per cent. more in eight hours than working by the day he can do in ten.
Differences may be expected to obtain in this respect in different
trades and kinds of work, so that there possibly cannot be any normal
day of labour for all trades alike, and each must adjust the term of its
labour to its own circumstances. But wherever piecework can increase the
rate of production to the extent mentioned by Mr. Denny, the day of
labour may be shortened with advantage, and it can apparently do so in
the very trades that most strongly object to it. A fact mentioned by Mr.
Nasmyth, in his remarkable evidence before the Trades Union Commission,
opens a striking view of the possibilities of increasing production
through developing the personal efficiency of the labouring class, and
of doing so without requiring any severe strain. "When I have been
watching men in my own work," he says, "I have noticed that at least
two-thirds of their time, even in the case of the most careful workmen,
is spent, not in work, but in criticising with the square or
straight-edge what they have been working, so as to say whether it is
right or wrong." And he adds--"I have observed that wherever you meet
with a dexterous workman, you will find that he is a man that need not
apply in one case in ten to his straight-edge or square." And why are
not all dexterous, or, at least, why are they not much more dexterous
than they now are? Mr. Nasmyth's answer is, because the faculty of
comparison by the eye is undeveloped in them, and he contends that this
faculty is capable of being educated in every one to a very much higher
degree than exists at present, and that its development ought to be made
a primary object of direct training at school. "If you get a boy," he
says, "to be able to lay a pea in the middle of two other peas, and in a
straight line with these two, that boy is a vast way on in the arts." He
has gone through a most valuable industrial apprenticeship before he has
entered a workshop at all. If, through training the eye, workmen can
save two-thirds of their time, it is manifest that there is abundant
scope for increasing productivity and shortening the day of labour at
the same time. Industrial efficiency is much more a thing of mind than
of muscle. _Jeder Arbeiter ist auch Kopfarbeiter._ All work is also
head work. Skill is but a primary labour-saving apparatus engrafted by
mind on eye and limb, and it is in developing the mental faculties of
the labourers by well-directed training, both general and technical,
that the chief conditions for their further improvement lie. Their
progress in intelligence may therefore be expected to increase their
productivity so as to justify a shortening of their day of labour, and
the leisure so acquired may be expected to be used so as to increase
their intelligence. Any advance men really make in the scale of moral
and mental being tends in this way to create the conditions necessary
for its maintenance.
We sometimes hear the same pessimist prophecy about shorter hours as we
have heard for centuries about better wages, that they will only seduce
the working class to increased dissipation. But experience is against
this view. Of course more leisure and more pay are merely means which
the labourer may according to his habits use for his destruction as
easily as for his salvation. But the increase in the number of
apprehensions for drunkenness that frequently accompanies a rise in
wages proves neither one thing nor another as to the general effect of
the rise on the whole class of labourers who have obtained it; it proves
only that the more dissipated among them are able to get oftener drunk.
Nor can the singular manifestations which the full hand sometimes takes
with the less instructed sections of the working class, especially when
it has been suddenly acquired, furnish any valid inference as to the way
it would be used by the working class in general, particularly if it
were their permanent possession. The evidence laid before the House of
Lords Committee on Intemperance shows that the skilled labourers of this
country are becoming less drunken as their wages and general position
are improving; and Porter, in his "Progress of the Nation," adduces some
striking cases of a steady rise of wages making a manifest change for
the better in the habits of unskilled labourers. He mentions, on the
authority of a gentleman who had the chief direction of the work, that
"the formation of a canal in the North of Ireland for some time afforded
steady employment to a portion of the peasantry, who before that time
were suffering all the evils so common in that country which result
from precariousness of employment. Such work as they could previously
get came at uncertain intervals, and was sought by so many competitors
that the remuneration was of the scantiest amount. In this condition the
men were improvident to recklessness. Their wages, insufficient for the
comfortable maintenance of their families, were wasted in procuring for
themselves a temporary forgetfulness of their misery at the whisky shop,
and the men appeared to be sunk into a state of hopeless degradation.
From the moment, however, that work was offered to them which was
constant in its nature and certain in its duration, and on which their
weekly earnings would be sufficient to provide for their comfortable
support, men who had been idle and dissolute were converted into sober,
hardworking labourers, and proved themselves kind and careful husbands
and fathers; and it is stated as a fact that, notwithstanding the
distribution of several hundred pounds weekly in wages, the whole of
which, would be considered as so much additional money placed in their
hands, the consumption of whisky was absolutely and permanently
diminished in the district. During the comparatively short period in
which the construction of this canal was in progress, some of the most
careful labourers--men who most probably before then never knew what it
was to possess five shillings at any one time--saved sufficient money to
enable them to emigrate to Canada, where they are now labouring in
independence for the improvement of their own land" (p. 451). It may be
difficult to extirpate drunkenness in our climate even with good wages,
but it is certainly impossible with bad, for bad wages mean insufficient
nourishment, comfortless house accommodation, and a want of that
elasticity after work which enables men to find pleasure in any other
form of enjoyment. As with better wages, so with shorter hours. The
leisure gained may be misused, especially at first; but it is
nevertheless a necessary lever for the social amelioration of the
labouring class, and it will more and more serve this purpose as it
becomes one of their permanent acquisitions. There can be no question
that long hours and hard work are powerful predisposing causes to
drunkenness. Studnitz mentions that several manufacturers in America had
informed him that they had invariably remarked, that with solitary
exceptions here and there, the men who wrought for the longest number of
hours were most prone to dissipation, and that the others were more
intelligent, and formed on the whole a better class. Part of the
prejudice entertained by working men against piecework comes from the
fact that it is very often accompanied with overtime, and when that is
the case, it generally exerts an unfavourable effect on the habits of
the workman. Mr. Applegarth said, in his evidence before the Trades
Union Commission, that nothing degraded the labourer like piecework and
overtime. Mr. George Potter stated, in his evidence before the Select
Committee on Masters and Operatives in 1860, that it was a common saying
among working people with regard to a man who works hard by piecework
and overtime, that such a man is generally a drunkard. He ascribed much
of the intemperance of the labouring class to the practice of working
"spells"--_i.e._, heats of work at high pressure on the piece and
overtime system--instead of steadily; and he says--"When I was at work
at the bench, I worked to a firm where there was much overtime and
piecework, and I found that the men at piecework were men who generally
spent five or six times more money in intoxicating drink, for the
purpose of keeping up their physical strength, than the men at day work.
I find, on close observation, that the men working at piecework are
generally a worse class of men in every way, both in intelligence and
education, and in pecuniary matters." Now, the ill effects which issue
from piecework combined with overtime could not accrue from piecework
combined with shorter hours. Besides, in a case of this kind it is
sometimes difficult to say which is cause and which effect, or how much
the one acts and reacts on the other. For both Mr. Potter and the
manufacturers mentioned by Studnitz represent the men who wrought
longest as being not only more drunken, but less intelligent and
educated, and, in fact, as being every way inferior; and we can easily
understand how men of unsteady habits should prefer to work "spells,"
and try to make up by excessive work three days in the week, for
excessive drinking the other three.
Dissipation and overtime generally go together, but neither of them is
a necessary accompaniment of piecework. The best check to both is
probably the spread of general education among the working class, for
the better educated workmen are even at present usually found against
them; and the spread of general education--I do not speak here of
technical--among the working class is more fruitful than even piecework
itself in opening up fresh reserves of industrial efficiency in our
labouring manhood. Roscher has pointed out how a stimulant like
piecework produces in a fairly well-educated district twice the result
it produces in a comparatively illiterate one. Taking the figures of
Goltz on rural labour in different German States, he shows that while
the earnings of pieceworkers were only 11 per cent. higher than the
earnings of day-workers in Osnabruck, they were as much as 23 per cent.
higher in Hesse. Mr. Peshine Smith mentions that the Board of Education
in Massachusetts procured from overseers of factories in that State a
return of the different amounts of wages paid and the degree of
education of those who received them. Most of the work was done by the
piece, and it was found that the wages earned rose in exact ratio with
the degree of education, from the foreigners at the bottom who made
their mark as the signature of their weekly receipts to the girls at the
top who did school in winter and worked in factories in summer. In some
branches of industry many new improvements remain unused because the
workpeople are too ignorant to work them properly. Moreover, for the
supreme quality of resourcefulness, education is like hands and feet,
and if we may judge from the number of useful labour-saving inventions
which working men give us even now, we cannot set limits to the number
they will give when the whole labouring class will have got the use of
their mind by an adequate measure of general education, and when, as we
may hope, they will have got leisure to use it in through a shortening
of the day of labour. The possibilities of this last source are very
well illustrated by an experiment of Messrs. Denny. In 1880 they
established in their ship-building yard at Dumbarton an award scheme for
recompensing inventions made by their workmen for improving existing
machinery or applying it to a new class of work, or introducing new
machinery in place of hand labour, or discovering any new method of
arranging or securing work that either improved its quality or
economized its cost. Mr. William Denny stated, after the scheme had been
nearly seven years in operation, that in that time as many as 196 awards
had been given for inventions which were thought useful to adopt, that
three times that number had been submitted for consideration, and that
besides being beneficial in causing so many useful improvements to be
made, the scheme had the effect of making the workmen of all departments
into active thinking and planning beings instead of mere flesh and blood
machines.
I cannot, therefore, take so dark a view as is sometimes entertained of
the futurity of the wage-labourer, even if he were compelled to remain
purely and permanently such. His position has substantially improved in
the past, and contains considerable capabilities for continued
improvement in the future. Of course the action of trade unions, besides
being confined to the limits I have described, is subject to the further
restriction, that it can only avail for the labourers who belong to
them, and is indeed founded on the exclusion or diminution of the
competition of others. They impose limitations on the number of
apprentices, and prescribe a certain standard of efficiency, loosely
ascertained, as a condition of membership. There can be no manner of
objection to the latter measure, nor does the former, though it is
manifestly liable to abuse and is sometimes vexatious in its operation,
seem to be practically worked so as to diminish the labour in any
particular industry beneath the due requirements of trade, or to create
an unhealthy monopoly. Then, though the trade unionists gather their
gains by keeping off the competition of others, it cannot be said that
these others are necessarily in any worse position than they would have
occupied if trade unions had never come into existence. It may even be
that through the operation of custom, which will always have an
influence in settling the price of labour, a certain benefit may be
reflected upon them from a rise in the usual price effected by trade
union agency. But in any case, it is no sound objection to an agency of
social amelioration that its efficiency is only partial, for it is not
so much to any single panacea, as to the application of a multitude of
partial remedies, that we can most wisely trust for the accomplishment
of our great aim.
II. The second main count in the socialist indictment of the present
industrial system is that it has multiplied the vicissitudes of trade,
and so imposed an incurable and distressing insecurity upon the
labourer's lot. The rapidity of technical transformation and the
frequency of commercial crises create, it is alleged, a perpetual
over-population, driving ever-increasing proportions of the labourers
out of active employment into what Marx calls the industrial reserve,
the hungry battalions of the half-employed or the altogether unemployed.
In regard to technical transformation, the effects of machinery on the
working class are now tolerably well understood. Individuals suffer in
the first instance, but the class, as a whole, is eventually a great
gainer. Machinery has always been the means of employing far more hands
than it superseded, when it did supersede any (for it has by no means
invariably done so). There is no way of "making work" like producing
wealth. The increased production due to machinery cheapens the
particular commodities produced by it, and thus enables the purchasers
of these commodities to spend more of their income on other things, and
so practically to make work for other labourers. But even in the trades
into which the machinery has been imported, the effect of its
introduction has been to multiply, instead of curtailing, employment.
Take the textile trades--much the most important of the machine
industries. Mr. Mulhall, in his "Dictionary of Statistics" (p. 338),
gives the following statistics of the textile operatives in the United
Kingdom at various dates:--
Year. Men. Women. Children. Total.
1835 82,000 167,000 104,000 353,000
1850 158,000 329,000 109,000 596,000
1880 232,000 543,000 201,000 976,000
Marx and others dwell much on the fact, that machinery leads frequently
to the substitution of female for male labour; but the preceding table
shows that while female labour has been largely multiplied, male labour
has been scarcely less so, and besides, a more extensive engagement of
women is in itself no public disadvantage. For half the question of our
pauperism is really the question of employment for women, it being so
much more difficult to find work for unemployed women than for
unemployed men; and if the course of industrial transformation opens up
new occupations that are suitable for them, it is so far entirely a
social gain, and no loss. No doubt, though the good accruing from
industrial transformation far outweighs the evil, yet evil does accrue
from it, and evil of the kind alleged, the tendency to develop local or
temporary redundancies of labour. But then that is an evil with which we
have never yet tried to cope, and it may probably be dealt with as
effectively on the present system as on any other. Socialism would stop
it by stopping the progress which it happens to accompany, and would
therefore envelop society in much more serious distress than it sought
to remove. In Marx's remarkable survey of English industrial history
almost every conquest of modern civilization is viewed with regret; but
it is manifestly idle to think of forcing society back now to a state in
which there should be no producing for profit, but only for private use,
no subdivision of labour, no machinery, no steam, for these are the very
means without which it would be impossible for our vastly increased
population to exist at all. What may be done to meet the redundancies of
labour that are always with us is a difficult but pressing question
which I cannot enter upon here. State provision of work--even in
producing commodities which are imported from abroad, and which might
therefore be produced in State workshops without hurting home
producers--has many drawbacks, but the problem is one that ought to be
faced, and something more must be provided for the case than workhouse
and prison.
In regard to commercial crises, they are rather lessening than
increasing. They may be more numerous, for trade is more extensive and
ramified, but they are manifestly less violent than they used to be. The
commercial and financial crises of the present century have been
moderate in their effects as compared with the Darien scheme, Law's
speculations in France, or the Tulip mania in the Low Countries, and
under the influence of the beneficial expansion of international
commerce and the equally beneficial principle of free trade, we enjoy
now an absolute immunity from the great periodical visitation of famine
which was so terrible a scourge to our ancestors. Facts like these are
particularly reassuring for this reason, that they are the result,
partly of better acquaintance with the principles of sound commercial
and financial success, and partly of the equalizing effect of
international ramifications of trade, and that these are causes from
which even greater things may be expected in the future, because they
are themselves progressive. There is no social system that can
absolutely abolish vicissitudes, because many of them depend on causes
over which man has no possible control, such as the harvests of the
world, and others on causes over which no single society of men has any
control, such as wars; and, besides, it is possible to do a great deal
more under the existing system than is at present done, to mitigate and
neutralize some of their worst effects. To provide the labouring
population with the security of existence, which is one of their
pressing needs, a sound system of working class insurance must be
devised, which shall indemnify them against all the accidents and
reverses of life, including temporary loss of work as well as sickness
and age, and it is not too much to hope, from the amount of attention
which the subject is at present attracting, that such a system will be
obtained. As far as yet appears, the scheme proposed by Professor Lujo
Brentano, to which I have already referred, is, on the whole, the
soundest and most satisfactory in its general principles that has been
advanced.
Again, much of the instability of trade arises from the want of
commercial statistics, and the consequent ignorance and darkness in
which it must be conducted. More light would lessen at once the mistakes
of well-meaning manufacturers and the opportunities of illegitimate and
designing speculation. Socialists count all speculation illegitimate,
because they fail to see that speculation, conducted in good faith,
exercises a moderating influence upon the oscillations of prices,
preventing them from falling so low, or rising so high, as they would
otherwise do. Speculation has thus a legitimate and beneficial work to
perform in the industrial system, and if it performed its work rightly,
it ought to have the opposite effect from that ascribed to it by
socialists, and to conduce to the stability of trade, instead of shaking
it. But unhappily an unscrupulous and fraudulent spirit too often
presides over this work. Schaeffle, who is not only an eminent political
economist, but has been Minister of Commerce to one of the great powers
of Europe, says that when he got acquainted with the bourse, he gave up
believing any longer in the economic harmonies, and declared theft to be
the principle of modern European commerce. Socialists always take the
bourse to be the type of capitalistic society, and the fraudulent
speculator to be the type of the bourse, and however they may err in
this, there is one point at any rate which it is almost impossible for
them to exaggerate, and that is the mischief accruing to the whole
community--and, as is usual with all general evils, to the working class
more than any other--from the prevalence of unsound trading and inflated
speculation. Confidence is the very quick of modern trade. The least
vibration of distrust paralyzes some of its movements and depresses its
circulation. Enterprise in opening new investments is indeed more and
more indispensable to the vitality of modern industry, but the mischiefs
of misdirected enterprise are as great as the benefits of well-directed.
Illegitimate speculation is very difficult to deal with. It can never be
reached by a public opinion which worships success and bows to wealth
with questionless devotion. Nor is it practicable for the State to put
it down by direct measures. But the State may perhaps mitigate it
somewhat by helping to procure a good system of commercial statistics,
for unsound speculation thrives in ignorance, and may be to some extent
prevented by better knowledge. The socialist demand for commercial
statistics is therefore to be approved. They would benefit everybody but
the dishonest dealer. They would not only be a corrective against
unsound speculation, but they would tend to smooth the conflicts between
capital and labour about the rate of wages, and the working class in
America press the demand on the ground of their experience of the
benefits they have already derived from the Labour Statistical Bureaux
established in certain of the States there. Some of our own most weighty
economic authorities are strongly in favour of a measure of this kind.
Mr. Jevons, for example, says: "So essential is a knowledge of the real
state of supply and demand to the smooth procedure of trade, and the
real good of the community, that I conceive it would be quite legitimate
to compel the publication of requisite statistics. Secrecy can only
conduce to the profit of speculators who gain from great fluctuations of
prices. Speculation is advantageous to the public only so far as it
tends to equalize prices, and it is therefore against the public good to
allow speculators to foster artificially the inequalities of prices by
which they profit. The welfare of millions, both of consumers and
producers, depends on an accurate knowledge of the stocks of cattle and
corn, and it would therefore be no unwarrantable interference with the
liberty of the subject to require any information as to the stock in
hand. In Billingsgate fish-market it has been a regulation that salesmen
shall fix up in a conspicuous place every morning a statement of the
kind and amount of their stock; and such a regulation, whenever it could
be enforced on other markets, would always be to the advantage of every
one except a few traders." ("Theory of Political Economy," p. 88.)
III. The next principal charge brought by socialists against the present
order of things is that it commits a signal injustice against the
labouring class, by suffering the capitalists who employ them to
appropriate the whole increase of value which results from the process
of production, and which, as is alleged, is contributed entirely by the
labour of the artizans engaged in the process. I have already exposed
the fallacy of the theory of value on which this claim is founded, and I
need not repeat here what for convenience sake has been stated in
another place. (See chap. iii. pp. 160-6). Value is not constituted by
time of labour alone, except in the case of commodities admitting of
indefinite multiplication; it is constituted in all other cases by
social utility; and the importance of this distinction is especially
manifest in treating of the very point that comes before us here--the
value of labour. Why is one kind of labour paid dearer than another? Why
is an organizer of manual labour better paid than the manual labourer
himself? Why is the railway chairman better paid than the railway
porter? Or why has the judge a better salary than the policeman? Is it
because he exerts more labour, more socially necessary time of labour?
No; the porter works as long as the chairman, and the policeman as long
as the judge. Is it because more time of labour has been expended in the
preparation and apprenticeship of the higher paid functionaries? No;
because the railway chairman may have undergone no special training that
thousands of persons with much poorer incomes have not also undergone,
and the education of the judge cost no more than the education of other
barristers who do not earn a twentieth part of his salary. The
explanation of differences of remuneration like these is not to be found
in different quantities of labour, but in different qualities of labour.
One man's work is higher, rarer, more excellent, possesses, in short,
more social utility than another's, and for that reason is more
valuable, as value is at present constituted. It is thus manifest that
the theory which declares value to be nothing but quantity of labour,
nothing but time of labour, is inconsistent with some of the most
obvious and important phenomena of the value of different kinds of
labour. Many forms of labour are much more remunerative than others,
nay, much more remunerative than many applications of capital, and the
difference of remuneration is in no way whatever connected with the
quantity of labour or the time of labour undergone in earning it.
Socialists may perhaps answer that this _ought not_ to be so; that if
things were as they should be, the railway chairman, the station-master,
the inspector, the guard, and the porter would be paid by the same
simple standard of the duration of their labour in the service of the
line--a standard which would probably reverse the present gradation of
their respective salaries; but if they make that answer, they change
their ground; they no longer base their claim for justice to the
labourer on value _as it is constituted_, but on value _as they think it
ought to be constituted_. Their theory of value would in that case not
be what it pretends to be, a scientific theory of the actual
constitution of value, but a utopian theory of its proper and just
constitution. It would be tantamount to saying, Every man, according to
our ideas of of justice, ought to be paid according to the value of his
work, and the value of his work, according to our ideas of justice,
ought to be measured by the time--the socially necessary time--it
occupied. But this whole argument is manifestly based on nothing better
than their own arbitrary conceptions of justice, and it needs no great
perspicacity to perceive that these conceptions of justice are entirely
wrong. In fact, the common sense of men everywhere would unhesitatingly
pronounce it unjust to requite the manager who contrives, organizes,
directs, with only the same salary as the labourer who executes under
his direction, because, while both may spend the same time of labour,
the service rendered by the one is much more _valuable_ than the service
rendered by the other. Let every man have according to his work, if you
will; but then, in measuring work, the true standard of its value is not
its duration but its social utility, the social importance of the
service it is calculated to render.
This criterion of social utility is the principle that ought to guide us
in answering the question that is really raised by the particular
socialist charge now under consideration, the question of the justice of
interest on capital. Interest is just because capital is socially
useful, and because the owner of capital, in applying it to productive
purposes, renders a service to society which is valuable in the measure
of its social utility. Of course the State might perform this service
itself. It might compulsorily abstract from the produce of each year a
sufficient portion to constitute the raw materials and instruments of
future production; but, as a matter of fact, the State does not do so.
It leaves the service to be rendered spontaneously by private persons
out of their private means. The service rendered by these persons to
production is as indispensable as the service rendered by the labourers,
and the justice of interest stands on exactly the same ground as the
justice of wages. The labourer cannot produce by labour alone, without
materials and implements, any more than the capitalist can produce by
materials and implements alone, without labour; and the possessor of
capital needs a reward to induce him to advance materials and implements
just as much as the labourer needs a reward to induce him to labour.
Nobody will set aside a portion of his property to provide for future
production if he is to reap no advantage from doing so, and if the
produce will be distributed in exactly the same way whether he sets it
apart or not. It would be as unjust as it would be suicidal to withhold
the recompense to which this service is entitled, and without which
nobody would do it.
The real question for socialists to answer is, not whether it is just to
pay private capitalists for the service society accepts at their hands,
but whether society can perform this service better, or more
economically, without them; whether, in short, the abolition of interest
would conduce to any real saving in the end? This practical question,
crucial though it be, is one, however, to which they seldom address
themselves--they prefer expatiating in cloudier regions. The question
may not, with our present experience, admit of a definitive and
authoritative answer; but the probabilities all point to the conclusion
that capitalistic management of production, costly as it may seem to be,
is really cheaper than that by which socialism would supersede it.
Capitalistic management is proverbially unrivalled for two qualities in
which bureaucratic management is as proverbially deficient--economy and
enterprise. Socialists complain much of the hosts of middlemen who are
nourished on the present system, the heartless parasites who eat the
bread of society without doing a hand's turn of real good; but their own
plan would multiply vastly the number of unnecessary intermediaries
depending on industry. Under the _regime_ of the capitalist there are,
we may feel sure, no useless clerks or overseers, for he has the
strongest personal interest in working his business as economically as
possible. But with the socialist mandarinate, the interest lies the
other way, and the tendency of the head officials would be to multiply
their subordinates and assistants, so that by abolishing the capitalist,
society would not by any means have got rid of middlemen and parasites.
There would be as much waste of labour as before. Lord Brassey is
certainly right in attributing the industrial superiority of Great
Britain as much to the administrative skill and economy of her employers
as to the efficiency of her labourers. Individual capitalists are more
enterprising, as well as more economical managers, than boards. Their
keenly interested eyes and ears are ever on the watch for opportunities,
for improvements, for new openings; and having to consult nothing but
their own judgment, they are much quicker in adapting themselves to
situations and taking advantage of turns of trade. They will undertake
risks that a board would not agree to, and they will have entered the
field and established a footing long before a manager can get his
directors to stir a finger. Now this habit of being always on the alert
for new extensions, and new processes, and new investments, is of the
utmost value to a progressive community, and it cannot be found to such
purpose anywhere as with the capitalistic despot the socialists
denounce, whose zeal and judgment are alike sharpened by his hope of
personal gain and risk of personal loss. Studnitz informs us that in
1878 he found the mills of New York standing idle, but those of
Philadelphia all going, and his explanation is that the former were
under joint-stock management and the latter belonged to private owners.
The present tendency towards a multiplication of joint-stock companies
is a perfectly good one, because, for one thing, it helps to a better
distribution of wealth; but society would suffer if this tendency were
to be carried so far as to supersede independent private enterprise
altogether, and if joint-stock companies were to become the only form of
conducting business. And if private enterprise is more advantageous than
joint-stock management, because it has more initiative and adaptability,
so joint-stock management is for the same reason more advantageous than
the official centralized management of all industry.[6]
If there is any force in these considerations, it seems likely that we
should make a bad bargain, if we dismissed our capitalists and private
employers, in the expectation that we could do the work more cheaply by
our own public administration. And the mistake would be especially
disappointing for this reason, that in the ordinary progress of society
in wealth and security the rate of interest always tends to fall, and
that various forces are already in operation that may not unreasonably
be expected to reduce the rate of profits as well. Profits, as
distinguished from interest, are the earnings of management, and the
minimum which employers will be content to take is at present largely
determined by the entirely wrong principle that their amount ought to
bear a direct proportion to the amount of capital invested in the
business. In spite of competition, customary standards of this kind are
very influential in the adjustment of such matters; they are the usual
criteria of what are called fair profits and fair wages; they always
carry with them strong persuasives to acquiescence; and then, from their
very nature, they are very dependent on public opinion. I am not
sanguine enough to believe with the American economist, President F. A.
Walker, that employers will ever come to be content with no other reward
than the gratification of power in the management of a great industrial
undertaking; but there is nothing extravagant in expecting that, through
the influence of public opinion and the constant pressure of trade
unions, a fairer standard of profits may be generally adopted, with the
natural consequence of allowing a rise of wages.
But whether these expectations are well grounded or no, one thing is
plain,--the only thing really material to the precise issue at present
before us,--and that is, that while interest and profits may be both
unfair in amount, just as rent may be, or wages, or judicial penalties,
neither of them is unjust in essence, because they are merely particular
forms of remunerating particular services, which are now actually
performed by the persons who receive the remuneration, and which, under
the socialist scheme, would have to be performed--and in all probability
neither so well nor so cheaply--by salaried functionaries.
With these remarks, we may dismiss the specific charge of injustice
brought by socialists against the present order of things, and the
specific claim of right for the labouring class which they prefer. Let
us now submit their proposals to a more practical and decisive
test--will they or will they not realize the legitimate aspirations, the
ideal of the working class? Does socialism offer a better guarantee for
the realization of that ideal than the existing economy? I believe it
does not. What is the ideal of the working class? It may be said to be
that they shall share _pari passu_ in the progressive conquests of
civilization, and grow in comfort and refinement of life as other
classes of the community have done. Now this involves two things--first,
progress; second, diffusion of progress; and socialism is so intent on
the second that it fails to see how completely it would cut the springs
of the first. Some of its adherents do assert that production would be
increased and progress accelerated under a socialistic economy, but they
offer nothing in support of the assertion, and certainly our past
experience of human nature would lead us to expect precisely the
opposite result. The incentives and energy of production would be
relaxed. I have already spoken of the loss that would probably be
sustained in exchanging the interested zeal and keen eye of the
responsible capitalist employer for the perfunctory administration of a
State officer. A like loss would be suffered from lightening the
responsibility of the labourers and lessening their power of
acquisition. Under a socialist _regime_ they cannot by any merit acquire
more property than they enjoy in daily use, and they cannot by any fault
fail to possess that. Now socialist labourers are not supposed, any more
than socialist officials, to be angels from heaven; they are to carry on
the work of society with the ordinary human nature which we at present
possess; and in circumstances like those just described, unstirred
either by hope or fear, our ordinary human nature would undoubtedly take
its ease and bask contentedly in the kind providence of the State which
relieved it of all necessity for taking thought or pains. The inevitable
result would be a great diminution of production, which, with a rapidly
increasing population (and socialism generally scouts the idea of
restraining it), would soon prove seriously embarrassing, and could only
be obviated by a resort to the lash; in a word, by a return to
industrial slavery. Now, with a lessening production, progress is
clearly impossible, and the more evenly the produce was distributed, the
more certain would be the general decline.
Socialists ignore the civilizing value of private property and
inheritance, because they think of property only as a means of immediate
enjoyment, and not as a means of progress and moral development. They
would allow private property only in what is sometimes termed consumers'
wealth. You might still own your clothes, or even purchase your house
and garden. But producers' wealth, they hold, should be common property,
and neither be owned nor inherited by individuals. If this theory were
to be enforced, it would be fatal to progress. Private property has all
along been a great factor in civilization, but the private property that
has been so has been much more producers' than consumers'. Consumers'
wealth is a limited instrument of enjoyment; producers' is a power of
immense capability in the hands of the competent. Socialists are really
more individualistic than their opponents in the view they take of the
function of property. They look upon it purely as a means for gratifying
the desires of individuals, and ignore the immense social value it
possesses as a nurse of the industrial virtues and an agency in the
progressive development of society from generation to generation.
There is still another and even more important spring of progress that
would be stifled by socialism--freedom. Freedom is, of course, a direct
and integral element in any worthy human ideal, for it is an
indispensable condition for individual development, but here it comes
into consideration as an equally indispensable condition of social
progress. Political philosophers, like W. von Humboldt and J. S. Mill,
who have pled strongly for the widest possible extension of individual
freedom, have made their plea in the interests of society itself. They
looked on individuality as the living seed of progress; without
individuality no variation of type or differentiation of function would
be possible; and without freedom there could be no individuality. Under
a _regime_ of socialism freedom would be choked. Take, for example, a
point of great importance both for personal and for social development,
the choice of occupations. Socialism promises a free choice of
occupations; but that is vain, for the relative numbers that are now
required in any particular occupation are necessarily determined by the
demands of consumers for the particular commodity the occupation in
question sets itself to supply. Freedom of choice is, therefore, limited
at present by natural conditions, which cause no murmuring; but these
natural conditions would still exist under the socialist _regime_, and
yet they would perforce appear in the guise of legal and artificial
restrictions. It would be the choice of the State that would determine
who should enter the more desirable occupations, and not the choice of
the individuals themselves. The accepted would seem favourites; the
rejected would complain of tyranny and wrong. Selection could not be
made by competitive examination without treason against the principles
of a socialist state, nor by lot without a sacrifice of efficiency. The
same difficulties would attend the distribution of the fertile and the
poor soils. Even consumption would not escape State inquisition and
guidance, for an economy that pretended to do away with commercial
vicissitudes must take care that a change of fashion does not extinguish
a particular industry by superseding the articles it produces. Socialism
would introduce, indeed, the most vexatious and all-encompassing
absolutist government ever invented. It would impose on its central
executive functions that would require omniscience for their discharge,
and an authority so excessive that E. von Hartmann is probably right in
thinking that obedience could only be secured by fabricating for it the
illusion of a Divine origin and reinforcing loyalty by superstition. The
extensive centralized authority given to government in France has
undoubtedly been one of the main causes of the instability of the
political system of that State, and a socialist rule, with its vastly
greater prerogatives, could only maintain its ascendancy by being
fabulously hedged with the divinity of a Grand Lama. A military
despotism would be at least more consistent with modern conditions; but
a military despotism socialists abjure, and yet believe that they can
exact from free and equal citizens an almost animal submission to an
authority they elect themselves.
Progress is only possible on the basis of industrial freedom and private
property; and in the socialist controversy there is no question about
the necessity of progress. That is an assumption common to both sides;
socialists of the present day acknowledge it as implicitly as the
general opinion of the time. They are no sharers in Mill's admiration
for the stationary state; they utterly ridicule his Malthusian horror of
a progressive population; and, profoundly impressed as they are with
the vital need for a better distribution of wealth, they hesitate to
sacrifice for it an increasing production. On the contrary, they claim
for their system that it would stimulate progress, as well as spread its
blessings, better than the system that exists, and Lassalle at all
events frankly declared that unless socialism increased production, it
would not be economically justifiable. But tried by this test, we have
seen reason to find it wanting. The problem to which it addresses
itself, the institution of a sound and healthy distribution of wealth,
is probably the greatest social problem of the time; but socialism fails
to solve it, because no distribution can be sound and healthy which
destroys the conditions of further progress. The true solution must
adhere to the lines of the present industrial system, the lines of
industrial freedom and private property.
It is one thing, however, to say that the principles of industrial
freedom and private property are essential to a healthy distribution,
and it is quite another thing to hold that the distribution is then
healthiest and most perfect when these principles enjoy the most
absolute and unconditional operation. If socialism errs by suppressing
them, _laissez-faire_ runs into the opposite error of giving them
unlimited authority. _Laissez-faire_ is perhaps hardly any longer a
living faith. But even when men still believed in the economic
harmonies, they always taught that the best and justest distribution of
wealth was that which issued out of the free competition of individuals,
and that if this distribution ever turned out to be really faulty or
partial, it was only because the competition was not free or perfect
enough; because some of the competitors were not sufficiently
enlightened as compared with others, or not sufficiently mobile with
their labour or capital; in other words, because the competition was not
conducted on equal terms. This theory manifestly makes the justice of
the distribution effected by free competition to depend on the false
assumption of the natural equality of the competitors, and therefore as
manifestly implies that unless men are equal in talents and
opportunities, the system of unlimited freedom may produce a
distribution that is seriously unjust. _Laissez-faire_ thus had a germ
of socialism in its being, and even when its ascendancy seemed to be
highest, it was already being practically replaced by a larger and more
energetic theory of social politics which imposed on the State the duty
of correcting many of the evils of the present distribution of wealth,
and promoting, if not equality of all conditions, yet certainly
amelioration of the inferior conditions. Instead of maintaining equal
freedom for weak and strong, the State was to take the part of the weak
against the strong, in order to secure to all citizens a real
participation in progressive civilization. It is said truly enough that
the effect of such interferences is not to destroy liberty, but to
fulfil it, because, apart from them, the labour contract is no more a
free contract for labourers living from hand to mouth than the
capitulation of a beleaguered garrison when their provisions have run
down is a free capitulation, and the legal intervention is necessary in
order to make the men first really free. Legal freedom is no more an end
in itself than legal intervention; both are merely means of giving men
real freedom and enabling them effectually to work out their complete
and normal vocation as human beings. I shall treat more fully of the
true theory of social politics in a subsequent chapter on State
Socialism; but here, in connection with its relation to industrial
freedom, it will be enough to say that the restraints it proposes are
neither meant nor calculated to impair real freedom, and that it is
separated from socialism by its constant care to develop rather than
supersede individual responsibility, to facilitate the spread of private
property rather than suppress it, and to remove obstacles that are
making men's own efforts a nullity rather than to substitute for those
efforts the providence of the State.
If, then, there is any truth in these considerations--if the general
acquisition of private property, and not its universal abolition, is the
demand of the working-class ideal--then the business of social reform at
present ought to be to facilitate the acquisition of private property;
to multiply the opportunities of industrial investment open to the
labouring classes, and to devise means for credit, for saving, for
insurance, and the like. While, for reasons already explained, I have
been unable to agree with Mr. Cairnes' despondent view of the economic
position of the wage-paid labourers, I am entirely at one with him in
conceiving the surest means to their progressive amelioration to lie in
participation, by one means or another, in industrial capital. Much good
may be done by a wider extension of trade unions, and a better
organization of working class insurance; but the labourers must not rest
content till they have found their way, under the new conditions of
modern trade, to become capitalists as well as labourers. Co-operative
production seems the most obvious solution of this problem; but it is a
mischievous, though a common mistake, to regard it as the only solution.
The fortunes of the working class are not all embarked in one bottom,
and their salvation may be expected to fulfil itself in many ways. I
cannot share in the lamentation sometimes made because some of the
earlier productive associations have departed from the strict and
original form of co-operation, under which all the shareholders in the
business were labourers and all the labourers shareholders. In the
present situation of affairs, variety of experiment is desirable, for
only out of many various experiments can we eventually discover which
are most suitable to the conditions and fittest to survive. Co-operative
production would perhaps have been further advanced to-day, if
co-operators had not been so faithful in their idolatry of their
original ideal, and had fostered instead of discouraging variations of
type, which may yet justify their superiority by persisting and
multiplying. As it is, co-operative production has not been such a
complete failure as it is sometimes represented; it can show at least a
few very signal tokens of success and great promise. It is often
declared to be inapplicable to the great industries, because they
require more capital and better management than co-operative working men
are usually able to furnish. But in the town and neighbourhood of Oldham
there are 100 co-operative spinning mills, with a capital of close on
L8,000,000. They are managed entirely by working men, their capital is
contributed in L5 shares by working men, and they have during the last
ten years paid dividends varying from 10 to 45 per cent. These are
joint-stock companies rather than co-operative societies in the stricter
sense; but they are joint-stock companies of working men, and they
furnish to working men in an effective and successful way that
participation in the industrial capital of the country which is really
what is wanted. The Oldham workman prefers to hold shares in a different
mill from that he works in, because he feels himself more free to
exercise his voice as a shareholder there, and he prefers to carry his
labour to the mill where he gets the best wages and the best treatment,
without being obliged to change his investment when he changes his
workshop. The advantage of the Oldham system over the stricter
co-operative type is therefore the old advantage of freedom. It suits
the English character better, and the only wonder is why it is still,
after more than sixteen years' successful experience, confined
exclusively to a single locality. It has been stated that there are a
thousand operatives working at these mills who are worth L1000 to L2000,
and besides the mills, there are co-operative stores, building
societies, and other working-class companies in Oldham, with a combined
capital of L3,500,000. In all these ways the zone of participators in
property broadens, and hope and stimulus are introduced into the
labourer's life. The truth seems to be that the great need of the
working man is not so much money to invest as opportunity and motive for
investment. The amount lodged in savings banks, the amount raised by
trade unions, the amount wasted in drink, the amount wasted in
inefficient household economy, which might be much lessened by better
instruction in the arts of cookery and household management--all show
that large numbers of the working class possess means at their disposal
to constitute at least the beginnings of their emancipation, if good
opportunities were open to them of using it advantageously in productive
enterprise. Co-operation and profit-sharing are not the only means by
which this might be realized. Private firms might initiate a practice of
reserving a certain amount of their capital to constitute a kind of
stock for their workmen to invest their savings in, under--if that were
legalized--limited liability. One advantage of this plan over the
ordinary industrial partnership would be, that while, like it, it would
enhance the workmen's zeal in their work, it could not possibly have the
effect of reducing wages, because the stock would be a free investment,
and would probably not be taken up by all or by more than a majority of
the workmen. Again, with a reform of our land laws, small investments in
land will certainly be facilitated, especially among the agricultural
class.
Socialists would no doubt condemn all such investments for the same
reason as they generally condemn the co-operative movement, because they
would tend to create "a new class with one foot in the camp of the
_bourgeoisie_ and the other in the camp of the proletariat." But that is
precisely one of their chief advantages, and in making this objection
socialists only betray how completely they ignore the operation of those
portions of human nature that are the real forces and factors of social
progress. It is only by linking a lower class to a higher that you can
raise the level of the whole, and every pathway the working class makes
into a comfortable equality with the lower _bourgeoisie_ will constitute
at once an opportunity and a spur for others to follow them, which will
exercise an elevating effect upon the entire body. If it were generally
open to all the labouring classes to begin by being wage-labourers and
end by sharing in some degree in the industrial capital of the country,
this would raise the level of the whole--of those who after all remained
wage-labourers still, as well as of those who succeeded in gaining a
better competency. It would give them all something to keep looking
forward to during their working life, something to save for and strive
after, and a higher standard of comfort would get diffused and
considered necessary in the class generally through the example of the
better off. For the more comfortably situated working men--whether they
have won their comfort by co-operation or otherwise--have not passed out
of their class. They have, as is alleged, one foot in the camp of the
proletariat still. They live and move and have their being among working
people, and constitute by their presence and social connections a
stimulating and elevating agency. It is through connections like these
that the ideas of comfort and culture that prevail among an upper class
permeate through to a lower, and thus elevate the general standard of
living upon which the level of wages so much depends. Even the minor
inequalities in the ranks of the working class are not without their use
in quickening their exertions to maintain the standard of respectability
which they have won or inherited. Economists were not wrong in ascribing
so much influence as they always have done to men's tenacity in adhering
to their customary standard of life. Many striking illustrations of its
beneficial operation might be mentioned. I select one, because it
concerns an aspect of the condition of the labouring classes of this
country that is at present attracting much attention--their house
accommodation. In all our large cities, the house accommodation of the
working class has hitherto been about as bad as bad could be, but there
is one singular exception--it is Sheffield. Porter drew attention to the
fact many years ago. "The town itself," he says, "is ill built and dirty
beyond the usual condition of English towns, but it is the custom for
each family among the labouring population to occupy a separate
dwelling, the rooms of which are furnished in a very comfortable manner.
The floors are carpeted, and the tables are usually of mahogany. Chests
of drawers of the same material are commonly seen, and so in many cases
is a clock also, the possession of which article of furniture has often
been pointed out as the certain indication of prosperity and of personal
responsibility on the part of the working man." ("Progress of the
Nation," p. 523.) The same condition of things still prevails, for at
the meeting of the British Association in Sheffield in 1879 Dr. Hime
read a paper on the vital statistics of the town, in which he
says:--"Although handsome public buildings are not a prominent feature
in the town, still there are few towns in England where the great bulk
of the population is so well provided for in the way of domestic
architecture. Overcrowding is very rare; cellar dwellings are unknown;
and almost every family has an entire house, a most important agent in
securing physical as well as moral health." (Transactions of British
Association, 1879.) Now this is a fact of the highest interest, and we
naturally ask what peculiarity there is in the trade or circumstances of
Sheffield, in the first place, to create such an exceptional excellence
in the standard of working class house accommodation, and, in the next
place, to maintain it. One thing is certain: it is not due to better
wages. There are trades in Sheffield very highly paid, but the labourers
belonging to them are described by the anonymous author of "An Inquiry
into the Moral, Social, and Intellectual Condition of the Industrious
Classes of Sheffield" (London, 1839), as being much less comfortable in
their circumstances than the others. This writer speaks of some trades
in which "the workmen are steady, intelligent, and orderly, seldom the
recipients of charity or parochial relief. They depend on their own
exertions for the respectable maintenance of their families, and when
trade is depressed they strive to live on diminished wages, or fall back
on resources secured by industry and economy. This healthy and vigorous
condition is not attributable to high wages. The workmen in the
edge-tool trade are extravagantly remunerated, and yet, as a body, they
are perhaps as irregular and dissipated in their habits as any in the
town. Their families, in time of good trade, feel few of the advantages
of prosperity, and when labour is little in demand, they are the first
to need the aid of charity. These differences are familiar to the most
superficial observer of the social and moral condition of the workmen in
the several branches" (p. 14). But the same writer mentions a
peculiarity in the trade of Sheffield which, he says, marks it off from
every other manufacturing town, and that peculiarity may serve to
provide us with the explanation we are seeking. "With us," he says, "the
distinctions between masters and men are not always well marked. Persons
are to a great extent both. The transition from the one to the other is
easy and frequent in those branches where the tools are few and simple,
and the capital required extremely small, which applies to the whole of
the cutlery department." "The facility with which men become masters
causes extraordinary competition, and its inevitable result,
insufficient remuneration." "Here merchants and manufacturers cannot
become princes.... There is not sufficient play for large fortunes. The
making of fortunes is with us a slow process. It is, however, far from
being partial.... The longer period required in the making of them
allows the mind time to adapt itself to its improved circumstances, not
merely the speculative and money-getting part of the understanding, but
the whole of its social, moral, and intellectual powers, without which
means are a questionable good. Wealth and intelligence are accordingly
with us more generally associated than in towns where immense fortunes
are rapidly made. In the latter case, there is no time for adaptation,
nor is it deemed necessary or at all important, where money is the
measure by which all things are estimated. Another evil dependent on
this sudden elevation in life is the great distance which is immediately
placed between employer and employed" (p. 15). Class and class are thus
better knit together in Sheffield than elsewhere. The exceptional
facility of becoming masters seems to be the particular instrumentality
which has brought down the ideas and habits of comfort of the
_bourgeoisie_ and spread them among the working class, and which has
always prevented the great mass of the latter from sinking contentedly
into a lower general standard of life. It introduced among them that
social ambition, which is the most effective spur to progress, and the
best preservative against decline. The fact that the exceptionally good
house accommodation which prevails among the labouring population of
Sheffield is not owing to exceptional, or even at all superior, wages,
is one of much hope and encouragement. What is possible in Sheffield
cannot be impossible elsewhere; and what is possible in the matter of
house accommodation cannot be hopeless in other branches of consumption.
I shall be told that in all this I am only repeating the foolish idea of
the French princess, who heard the people complain they could not get
bread, and asked why then they did not buy cake. Where combinations are
possible, it will be said, investments may be also possible; but the
great majority of the working class are not in a position to combine,
and it is mere mockery to tell people to save and invest who can hardly
contrive to cover their backs. To this I reply, that there is no reason
to assume that trade unions have reached the utmost extension of which
they are susceptible, or to despair of their introduction into the
hitherto unorganized trades. It was only lately common to deny the
possibility of combination among agricultural labourers, and yet,
scattered as they are, they have shown themselves not only able to
combine, but to raise wages effectively by means of their combinations.
We have now very powerful unions of unskilled day labourers, and a
beginning has been made of an efficient organization even among
needlewomen. It is true that, even when organization has spoken its last
word, much of the distressing poverty that now exists would probably
still remain, because we must not disguise from ourselves the fact that
much of that poverty is the direct fruit of vice, disease, or indolence.
But socialism could not cope with this mass of misery any better than
the present system, for men don't drink and loaf and enter into
improvident marriages or illicit alliances because they happen to be
paid for their labour by contract with a capitalist instead of valuation
by a State officer, and they certainly would not cease doing any of
these things because an indulgent State undertook to save them from the
natural penalties of doing them.
FOOTNOTES:
[4] The proportion in England for 1857, according to official figures,
was 31/2 times the number for one day, but whether that proportion
continues still we have no means of knowing.
[5] Mr. Denny was led by subsequent experience to a much less favourable
view of the efficacy of piecework as an instrument of working-class
progress. He wrote me in June, 1886 (ten years after the publication of
the pamphlet I have quoted above) an interesting and valuable letter on
this subject, which is published in full in Dr. Bruce's biography of him
("Life of William Denny," p. 113). A larger experience of piecework, he
said, had convinced him that, excepting in cases where rates can be
fixed and made a matter of agreement between the whole body of the men
in any works and their employers, piecework prices have not a
self-regulating power, and are liable, under the pressure of
competition, to be depressed below what he would consider a proper
level. And this was chiefly, if not, indeed, exclusively, the case with
those lump jobs which were undertaken by little copartneries of workmen,
and afforded the occasions for practising co-operation from which he had
drawn the hopes I have mentioned above. He came to see that in all kinds
of work for which it was difficult to fix regular rates, the beneficial
operation of payment by the piece on wages was much more uncertain than
he previously supposed, except in the hands of a good master, who was
not an absentee. But for ordinary work, I think he still adhered to his
favourable opinion of the effect of the piece system in increasing the
worker's earnings. He said he had nothing to modify about the figures
adduced in his pamphlet, and I understood him to continue to count them
representative of the general operation of pieceworking.
[6] More will be found on this subject in the chapter on "State
Socialism," under the sub-heading "State Socialism and State
Management."