Sec. 7. Causes of the Industrial Weakness of Women.—This brief summary of the industrial condition of low-skilled women-workers will suffice to bring out the fact that the "sweating" question is even more a woman's question than a man's. The question which rises next is, Why do women as industrial workers suffer more than men?

In the first place, as the physically weaker sex, they do on the average a smaller quantity of work, and therefore receive lower wages. In certain kinds of work, where women do piece-work along with men, it is found that they get as high wages as men for the same quantity of work. The recent report upon Textile Industries establishes this fact so far as those trades are concerned. But this is not always, perhaps not in the majority of instances, the case. Women-workers do not, in many cases, receive the same wages which would be paid to men for doing the same work. Why is this? It is sometimes described as an unfair advantage taken of women because they are women. There is a male prejudice, it is urged, against women-workers, which prevents employers from paying them the wages they could and would pay to men.

Now this contention, so far as it refers to a sentimental bias, is not tenable. A body of women-workers, equally skilled with male workers, and as strongly organized, would be able to extract the same rate of wages in any trade. Everything depends upon the words "as strongly organized." It is the general industrial weakness of the condition of most women-workers, and not a sex prejudice, which prevents them from receiving the wages which men might get, if the work the women do were left for male competition alone. An employer, as a rule, pays the lowest wages he can get the work done at. The real question we have to meet is this. Why can he get women who will consent to work at a lower rate than he could get men to work at? What peculiar conditions are there affecting women which will oblige them to accept work on lower terms than men?

Well, in the first place, the wage of a man can never fall much lower than will suffice to maintain at the minimum standard of comfort both himself and the average family he has to support. The minimum wage of the man, it is true, need not cover the full support of his family, because the wife or children will on the average contribute something to their maintenance. But the wage of the man must cover his own support, and part of the support of his family. This marks a rigid minimum wage for male labour; if competition tends to drive wages lower, the supply of labour is limited to unmarried males.

The case of woman is different. If she is a free woman her minimum wage will be what is required to support herself alone, and since a woman appears able to keep alive and in working condition on a lower scale of expenditure than man, the possible minimum wage for independent women- workers will be less than a single man would consent to work for, and considerably less than what a married man would require. But there are other economic causes more important than this which drag down women's wages.

Single women, working to support themselves, are subject to the constant competition of other women who are not dependent for their full livelihood on the wages they get, and who, if necessary, are often willing to take wages which would not keep them alive if they had no other source of income. The minimum wages which can be obtained for certain kinds of work may by this competition of "bounty-fed" labour be driven considerably below starvation point. This is no mere hypothesis. It will be obvious that the class of fur-sewers who, as we saw, earned while in full work from 4s. to 7s. in the winter months, and the lower grades of brush-makers and match-makers, to say nothing of the casual "out-workers," who often take for a whole week's work 3s. or 2s. 6d., cannot, and do not, live upon these earnings. They must either die upon them, as many in fact do, or else they must be assisted by other funds.

There are, at least, three classes of female workers whose competition helps to keep wages below the point of bare subsistence in the employments which they enter.

First, there are married women who in their eagerness to increase the family income, or to procure special comforts for themselves, are willing to work at what must be regarded as "uncommercial rates"; that is to say, for lower wages than they would be willing to accept if they were working for full maintenance. It is sometimes asserted that since these married women have not so strong a motive to secure work, they will not, and in fact do not, undersell, and bring down the rate of wages. But it must be admitted, firstly, that the very addition of their number to the total of competitors for low-skilled work, forces down, and keeps down, the price paid for that work; and secondly, that if they choose, they are enabled to underbid at any time the labour of women entirely dependent on themselves for support. The existence of this competition of married women must be regarded as one of the reasons why wages are low in women's employments.

Secondly, a large proportion of unmarried women live at home. Even if they pay their parents the full cost of their keep, they can live more cheaply than if they had to find a home for themselves. A large proportion, however, of the younger women are partly supported at the expense of their family, and work largely to provide luxuries in the shape of dress, and other ornamental articles. Many of them will consent to work long hours all week, for an incredibly low sum to spend on superfluities.

Thirdly, there is the competition of women assisted by charity, or in receipt of out-door poor relief. Sums paid by Boards of Guardians to widows with young children, or assistance given by charitable persons to aid women in distressed circumstances to earn a livelihood, will enable these women to get work by accepting wages which would have been impossible if they had not outside assistance to depend upon. It is thus possible that by assisting a thoroughly deserving case, you may be helping to drive down below starvation-point the wages of a class of workers.

Probably a large majority of women-workers are to some extent bounty-fed in one of these ways. In so far as they do receive assistance from one of these sources, enabling them to accept lower wages than they could otherwise have done, it should be clearly understood that they are presenting the difference between the commercial and the uncommercial price as a free gift to their employer, or in so far as competition will oblige him to lower his prices, to the public, which purchases the results of their work. But the most terrible effect of this uncommercial competition falls on that miserable minority of their sisters who have no such extra source of income, and who have to make the lower wages find clothes, and shelter for themselves, and perhaps a family of children. We hear a good deal about the jealousy of men, and the difficulties male Trade Unions have sometimes thrown in the way of women obtaining employment, which may seem to affect male interests. But though there is doubtless some ground for these complaints, it should be acknowledged that it is women who are the real enemies of women. Women's wages in the "sweating" trades are almost incredibly low, because there is an artificially large supply of women able and willing to take work at these low rates.

It will be possible to raise the wages in these low-paid employments only on condition that women will agree to refuse to undersell one another beyond a certain point. A restriction in what is called "freedom of competition" is the only direct remedy which can be applied by women themselves. If women could be induced to refuse to avail themselves of the terrible power conferred by these different forms of "bounty," their wages could not fall below that 9s. or 10s. which would be required to keep them alive, and would probably rise higher.

Sec. 8. What Trade Unionism can do for them.—A question which naturally rises now is, how far combination in the form of Trade Unionism can assist to raise the industrial condition of these women. The practical power wielded by male Unions we saw was twofold. Firstly, by restricting the supply of labour in their respective trades they raised its market price, i.e. wages. Secondly, they could extract better conditions from employers, by obliging the latter to deal with them as a single large body instead of dealing with them as a number of individuals. How far can women-workers effect these same ends by these same means?

Trade Unionism, so far as women are concerned, is yet in its infancy. In 1874, Mrs. Paterson established a society, now named the Women's Trades Union Provident League, to try and establish combination among women in their several trades. The first Union was that of women engaged in book- binding, formed in September 1874. Since then a considerable number of Unions have been formed among match-makers, dressmakers, milliners, mantle-makers, upholstresses, rope-makers, confectioners, box-makers, shirt-makers, umbrella-makers, brush-makers and others. Many of these have been formed to remedy some pressing grievance, or to secure some definite advance of wage, and in certain cases of skilled factory work where the women have maintained a steady front, as among the match- makers and the confectioners, considerable concessions have been won from employers. But the small scale and tentative character of most of these organizations do not yet afford any adequate test of what Unionism can achieve. The workers in a few factories here and there have formed a Union of, at the most, a few hundred workers. No large women's trade has yet been organized with anything approaching the size and completeness of the stronger men's Unions. Women Trade Unionists numbered 120,178 in 1901, and of these no less than 89.9 per cent were textile workers, whose Unions are mostly organized by and associated with male Unions.

There are several reasons why the growth of effective organization among women-workers must be slow. In the first place, as we have seen, a large proportion of their work is "out work" done at home or in small domestic workshops. Now labour organizations are necessarily strong and effective, in proportion as the labourers are thrown together constantly both in their work and in their leisure, have free and frequent opportunities of meeting and discussion, of educating a sense of comradeship and mutual confidence, which shall form a moral basis of unity for common industrial action. But to the majority of women-workers no such opportunities are open. Even the factory workers are for the most part employed in small groups, and are dispersed in their homes. Combination among the mass of home-workers or workers in small sweating establishments is almost impossible. The women's Unions have hitherto been successful in proportion as the trades are factory trades. Where endeavours have been made to organize East End shirt-makers, milliners, and others who work at home, very little has been achieved. In those trades where it is possible to give out an indefinite amount of the work to sub-contractors, or to workers to do at home, it seems impossible that any great results can be thus attained. Even in trades where part of the work is done in factories, the existence of reckless competition among unorganized out-workers can be utilized by unprincipled employers to destroy attempts at effective combination among their factory hands. The force of public opinion which may support an organization of factory workers by preventing outsiders from underselling, can have no effect upon the competition of home-workers, who bid in ignorance of their competitors, and bid often for the means of keeping life in themselves and their children. The very poverty of the mass of women-workers, the low industrial conditions, which Unionism seeks to relieve, form cruel barriers to the success of their attempts. The low physical condition, the chronic exhaustion produced by the long hours and fetid atmosphere in which the poorer workers live, crush out the human energy required for effective protest and combination. Moreover, the power to strike, and, if necessary, to hold out for a long period of time, is an essential to a strong Trade Union. Almost all the advantages won by women's Unions have been won by their proved capacity for holding out against employers. This is largely a matter of funds. It is almost impossible for the poorest classes of women-workers to raise by their own abstinence a fund which shall make their Union formidable. Their efforts where successful have been always backed by outside assistance. Even were there a close federation of Unions of various women's trades— a distant dream at present—the larger proportion of recipients of low wages among women-workers as compared with men would render their success more difficult.

Sec. 9. Legislative Restriction and the force of Public Opinion.—If Trade Unionism among women is destined to achieve any large result, it would appear that it will require to be supported by two extra-Union forces.

The first of these forces must consist of legislative restriction of "out-work." If all employers of women were compelled to provide factories, and to employ them there in doing that work at present done at home or in small and practically unapproachable workshops, several wholesome results would follow. The conditions of effective combination would be secured, public opinion would assist in securing decent wages, factory inspection would provide shorter hours and fair sanitary conditions, and last, not least, women whose home duties precluded them from full factory work would be taken out of the field of competition. Whether it would be possible to successfully crush the whole system of industrial "out-work" may be open to question; but it is certain that so long as, and in proportion as "out-work" is permitted, attempts on the part of women to raise their industrial condition by combination will be weak and unsuccessful. So long as "out-work" continues to be largely practised and unrestrained, competition sharpened by the action of married women and other irregular and "bounty-fed" labour, must keep down the price of women's work, not only for the out-workers themselves, but also for the factory workers. Nor is it possible to see how the system of "out-work" can be repressed or even restricted by any other force than legislation. So long as home-workers are "free" to offer, and employers to accept, this labour, it will continue to exist so long as it pays; it will pay so long as it is offered cheap enough; and it will be offered cheaply so long as the supply continues to bear the present relation to the demand.

But there is another force required to give any full effect to such extensions of the Factory Act as will crush private workshops, and either directly or indirectly prohibit out-work. The real reason, as we saw, why woman's wages were proportionately lower than man's, was the competition of a mass of women, able and willing to work at indefinitely low rates, because they were wholly or partly supported from other sources. Now legislation can hardly interfere to prevent this competition, but public opinion can. If the greater part of the industrial work now done by women at home were done in factories, this fact in itself would offer some restrictions to the competition of married women, which is so fatal to those who depend entirely upon their wages for a livelihood. But the gradual growth of a strong public opinion, fed by a clear perception of the harm married women do to their unsupported sisters by their competition, and directed towards the establishment of a healthy social feeling against the wage-earning proclivities of married women, would be a far more wholesome as well as a more potent method of interference than the passing of any law.

To interfere with the work of young women living at home, and supported in large part by their parents, would be impracticable even if it were desirable, although the competition of these conduces to the same lowering of women's wages. But the education of a strong popular sentiment against the propriety of the industrial labour of married women, would be not only practicable, but highly desirable. Such a public sentiment would not at first operate so stringently as to interfere in those exceptional cases where it seems an absolute necessity that the wife should aid by her home or factory work the family income. But a steady pressure of public opinion, making for the closer restriction of the wage-work of married women, would be of incomparable value to the movement to secure better industrial conditions for those women who are obliged to work for a living. A fuller, clearer realization of the importance of this subject is much needed at the present time. The industrial emancipation of women, favoured by the liberal sentiments of the age, has been eagerly utilized by enterprising managers of businesses in search of the cheapest labour. Not only women, but also children are enabled, owing to the nature of recent mechanical inventions which relieve the physical strain, but increase the monotony of labour, to make themselves useful in factories or home-work. Each year sees a large growth in the ranks of women- workers. Eager to earn each what she can, girls and wives alike rush into factory work, reckless of the fact that their very readiness to work tells against them in the amount of their weekly wages, and only goes to swell the dividends of the capitalist, or perhaps eventually to lower prices. The improving mechanism of our State School System assists this movement, by turning out every year a larger percentage of half- timers, crammed to qualify for wage-earners at the earliest possible period. Already in Lancashire and elsewhere, the labour of these thirteen-year-olders is competing with the labour of their fathers. The substitution of the "ring" for the "mule" in Lancashire mills, is responsible for the sight which may now be seen, of strong men lounging about the streets, supported by the earnings of their own children, who have undersold them in the labour market. The "ring" machine can be worked by a child, and can be learned in half an hour; that is the sole explanation of this deplorable phenomenon.

In the case of child-work, with its degrading consequences on the physical and mental health of the victim thus prematurely thrust into the struggle of life, legislation can doubtless do much. By raising the standard of education, and, if necessary, by an absolute prohibition of child-work, the State would be keeping well within the powers which the strictest individualist would assign to it, as it would be merely protecting the rising generation against the cupidity of parents and the encroachments of industrial competition.

The case of married women-workers is different. Better education of women in domestic work and the requirements of wifehood and motherhood; the growth of a juster and more wholesome feeling in the man, that he may refuse to demand that his wife add wage-work to her domestic drudgery; and above all, a clearer and more generally diffused perception in society of the value of healthy and careful provision for the children of our race, should build up a bulwark of public opinion, which shall offer stronger and stronger obstruction to the employment of married women, either outside or inside the home, in the capacity of industrial wage-earners. The satisfaction rightly felt in the ever wider opportunities afforded to unmarried women of earning an independent livelihood, and of using their abilities and energies in socially useful work, is considerably qualified by our perception of the injury which these new opportunities inflict upon our offspring and our homes. Surely, from the large standpoint of true national economy, no wiser use could be made of the vast expansion of the wealth-producing power of the nation under the reign of machinery, than to secure for every woman destined to be a wife and a mother, that relief from the physical strain of industrial toil which shall enable her to bring forth healthy offspring, and to employ her time and attention in their nurture, and in the ordering of a cleanly, wholesome, peaceful home life. So long as public opinion permits or even encourages women, who either are or will be mothers, to neglect the preparation for, and the performance of, the duties of domestic life and of maternity, by engaging in laborious and unhealthy industrial occupations, so long shall we pay the penalty in that physical and moral deterioration of the race which we have traced in low city life. How can the women of Cradley Heath engaged in wielding huge sledge-hammers, or carrying on their neck a hundredweight of chain for twelve or fourteen hours a day, in order to earn five or seven shillings a week, bear or rear healthy children? What "hope of our race" can we expect from the average London factory hand? What "home" is she capable of making for her husband and her children? The high death-rate of the "slum" children must be largely attributed to the fact that the women are factory workers first and mothers afterwards. Roscher, the German economist, assigns as the reason why the Jewish population of Prussia increases so much faster than the Christian, the fact that the Jewish mothers seldom go out of their own homes to work.[36] One of the chief social dangers of the age is the effect of industrial work upon the motherhood of the race. Surely, the first duty of society should be to secure healthy conditions for the lives of the young, so as to lay a firm physical foundation for the progress of the race.

This we neglect to do when we look with indifference or complacency upon the present phase of unrestricted competition in industrial work amongst women. So long as we refuse to insist, as a nation, that along with the growth of national wealth there shall be secured those conditions of healthy home life requisite for the sound, physical, moral, and intellectual growth of the young, at whatever cost of interference with so-called private liberty of action, we are rendering ourselves as a nation deliberately responsible for the continuance of that creature whose appearance gives a loud lie to our claim of civilization—the gutter child of our city streets. Thousands of these children, as we well know, the direct product of economic maladjustment, grow up every year—in our great cities to pass from babyhood into the street arab, afterwards to become what they may, tramp, pauper, criminal, casual labourer, feeble-bodied, weak-minded, desolate creatures, incapable of strong, continuous effort at any useful work. These are the children who have never known a healthy home. With that poverty which compels mothers to be wage-earners, lies no small share of the responsibility of this sin against society and moral progress. It is true that no sudden general prohibition of married woman's work would be feasible. But it is surely to be hoped that with every future rise in the wages and industrial position of male wage-earners, there may be a growing sentiment in favour of a restriction of industrial work among married women.



Chapter IX.

Moral Aspects of Poverty.



Sec. 1. "Moral" View of the Causes of Poverty.—Our diagnosis of "sweating" has regarded poverty as an industrial disease, and we have therefore concerned ourselves with the examination of industrial remedies, factory legislation, Trade Unionism, and restrictions of the supply of unskilled labour. It may seem that in doing this we have ignored certain important moral factors in the problem, which, in the opinion of many, are all important. Until quite recently the vast majority of those philanthropic persons who interested themselves in the miserable conditions of the poor, paid very slight attention to the economic aspect of poverty, and never dreamed of the application of economic remedies. It is not unnatural that religions and moral teachers engaged in active detailed work among the poor should be so strongly impressed by the moral symptoms of the disease as to mistake them for the prime causes. "It is a fact apparent to every thoughtful man that the larger portion of the misery that constitutes our Social Question arises from idleness, gluttony, drink, waste, indulgence, profligacy, betting, and dissipation." These words of Mr. Arnold White express the common view of those philanthropists who do not understand what is meant by "the industrial system," and of the bulk of the comfortable classes when they are confronted with the evils of poverty as disclosed in "the sweating system." Intemperance, unthrift, idleness, and inefficiency are indeed common vices of the poor. If therefore we could teach the poor to be temperate, thrifty, industrious, and efficient, would not the problem of poverty be solved? Is not a moral remedy instead of an economic remedy the one to be desired? The question at issue here is a vital one to all who earnestly desire to secure a better life for the poor. This "moral view" has much to recommend it at first sight. In the first place, it is a "moral" view, and as morality is admittedly the truest and most real end of man, it would seem that a moral cure must be more radical and efficient than any merely industrial cure. Again, these "vices" of the poor, drink, dirt, gambling, prostitution, &c., are very definite and concrete maladies attaching to large numbers of individual cases, and visibly responsible for the misery and degradation of the vicious and their families. Last, not least, this aspect of poverty, by representing the condition of the poor to be chiefly "their own fault," lightens the sense of responsibility for the "well to do." It is decidedly the more comfortable view, for it at once flatters the pride of the rich by representing poverty as an evidence of incompetency, salves his conscience when pricked by the contrast of the misery around him, and assists him to secure his material interests by adopting an attitude of stern repression towards large industrial or political agitations in the interests of labour, on the ground that "these are wrong ways of tackling the question."

Sec. 2. "Unemployment" and the Vices of the Poor.—The question is this, Can the poor be moralized, and will that cure Poverty? To discuss this question with the fullness it deserves is here impossible, but the following considerations will furnish some data for an answer—

In the first place, it is very difficult to ascertain to what extent drink, vice, idleness, and other personal defects are actually responsible for poverty in individual cases. There is, however, reason to believe that the bulk of cases of extreme poverty and destitution cannot be traced to these personal vices, but, on the other hand, that they are attributable to industrial causes for which the sufferer is not responsible. The following is the result of a careful analysis of 4000 cases of "very poor" undertaken by Mr. Charles Booth. These are grouped as follows according to the apparent causes of distress—

4 per cent, are "loafers." 14 " " are attributed to drink and thriftlessness. 27 " " are due to illness, large families, or other misfortunes. 55 " " are assigned to "questions of employment."

Here, in the lowest class of city poor, moral defects are the direct cause of distress in only 18 per cent. of the cases, though doubtless they may have acted as contributory or indirect causes in a larger number.

In the classes just above the "very poor," 68 per cent. of poverty is attributed to "questions of employment," and only 13 per cent. to drink and thriftlessness. In the lowest parts of Whitechapel drink figures very slightly, affecting only 4 per cent. of the very poor, and 1 per cent. of the poor, according to Mr. Booth. Even applied to a higher grade of labour, a close investigation of facts discloses a grossly exaggerated notion of the sums spent in drink by city workers in receipt of good wages. A careful inquiry into the expenditure of a body of three hundred Amalgamated Engineers during a period of two years, yielded an average of 1s. 9d. per week spent on drink.

So, too, in the cases brought to the notice of the Lords' Committee, drink and personal vices do not play the most important part. The Rev. S. A. Barnett, who knows East London so well, does not find the origin of poverty in the vices of the poor. Terrible as are the results of drunkenness, impurity, unthrift, idleness, disregard of sanitary rules, it is not possible, looking fairly at the facts, to regard these as the main sources of poverty. If we are not carried away by the spirit of some special fanaticism, we shall look upon these evils as the natural and necessary accessories of the struggle for a livelihood, carried on under the industrial conditions of our age and country. Even supposing it were demonstrable that a much larger proportion of the cases of poverty and misery were the direct consequence of these moral and sanitary vices of the poor, we should not be justified in concluding that moral influence and education were the most effectual cures, capable of direct application. It is indeed highly probable that the "unemployed" worker is on the average morally and industrially inferior to the "employed," and from the individual point of view this inferiority is often responsible for his non-employment. But this only means that differences of moral and industrial character determine what particular individuals shall succeed or fail in the fight for work and wages. It by no means follows that if by education we could improve all these moral and industrial weaklings they could obtain steady employment without displacing others. Where an over-supply of labour exists, no remedy which does not operate either by restricting the supply or increasing the demand for labour can be effectual.

Sec. 3. Civilization ascends from Material to Moral.—The life of the poorest and most degraded classes is impenetrable to the highest influences of civilization. So long as the bare struggle for continuance of physical existence absorbs all their energies, they cannot be civilized. The consideration of the greater intrinsic worth of the moral life than the merely physical life, must not be allowed to mislead us. That which has the precedence in value has not the precedence in time. We must begin with the lower life before we can ascend to the higher. As in the individual the corpus sanum is rightly an object of earlier solicitude in education than the mens sana, though the latter may be of higher importance; so with the progress of a class. We cannot go to the lowest of our slum population and teach them to be clean, thrifty, industrious, steady, moral, intellectual, and religious, until we have first taught them how to secure for themselves the industrial conditions of healthy physical life. Our poorest classes have neither the time, the energy, or the desire to be clean, thrifty, intellectual, moral, or religious. In our haste we forget that there is a proper and necessary order in the awakening of desires. At present our "slum" population do not desire to be moral and intellectual, or even to be particularly clean. Therefore these higher goods must wait, so far as they are dependent on the voluntary action of the poor. What these people do want is better food, and more of it; warmer clothes; better and surer shelter; and greater security of permanent employment on decent wages. Until we can assist them to gratify these "lower" desires, we shall try in vain to awaken "higher" ones. We must prepare the soil of a healthy physical existence before we can hope to sow the moral seed so as to bring forth fruit. Upon a sound physical foundation alone can we build a high moral and spiritual civilization.

Moral and sanitary reformers have their proper sphere of action among those portions of the working classes who have climbed the first rounds in the ladder of civilization, and stand on tolerably firm conditions of material comfort and security. They cannot hope at present to achieve any great success among the poorest workers. The fact must not be shirked that in preaching thrift, hygiene, morality, and religion to the dwellers in the courts and alleys of our great cities, we are sowing seed upon a barren ground. Certain isolated cases of success must not blind us to this truth. Take, for example, thrift. It is not possible to expect that large class of workers who depend upon irregular earnings of less than 18s. a week to set by anything for a rainy day. The essence of thrift is regularity, and regularity is to them impossible. Even supposing their scant wage was regular, it is questionable whether they would be justified in stinting the bodily necessities of their families by setting aside a portion which could not in the long run suffice to provide even a bare maintenance for old age or disablement. To say this is not to impugn the value of thrift in maintaining a character of dignity and independence in the worker; it is simply to recognize that valuable as these qualities are, they must be subordinated to the first demands of physical life. Those who can save without encroaching on the prime necessaries of life ought to save; but there are still many who cannot save, and these are they whom the problem of poverty especially concerns. The saying of Aristotle, that "it is needful first to have a maintenance, and then to practise virtue," does not indeed imply that we ought to postpone practising the moral virtues until we have secured ourselves against want, but rather means that before we can live well we must first be able to live at all.

Precisely the same is true of the "inefficiency" of the poor. Nothing is more common than to hear men and women, often incapable themselves of earning by work the money which they spend, assigning as the root of poverty the inefficiency of the poor. It is quite true that the "poor" consist for the most part of inefficient workers. It would be strange if it were not so. How shall a child of the slums, ill-fed in body and mind, brought up in the industrial and moral degradation of low city life, without a chance of learning how to use hands or head, and to acquire habits of steady industry, become an efficient workman? The conditions under which they grow up to manhood and womanhood preclude the possibility of efficiency. It is the bitterest portion of the lot of the poor that they are deprived of the opportunity of learning to work well. To taunt them with their incapacity, and to regard it as the cause of poverty, is nothing else than a piece of blind insolence. Here and there an individual may be to blame for neglected opportunities; but the "poor" as a class have no more chance under present conditions of acquiring "efficiency" than of attaining to refined artistic taste, or the culminating Christian virtue of holiness. Inefficiency is one of the worst and most degrading aspects of poverty; but to regard it as the leading cause is an error fatal to a true understanding of the problem.

We now see why it is impossible to seriously entertain the claim of Co- operative Production as a direct remedy for poverty. The success of Co- operative schemes depends almost entirely upon the presence of high moral and intellectual qualities in those co-operating—trust, patience, self restraint, and obedience combined with power of organization, skill, and business enterprise. These qualities are not yet possessed by our skilled artisan class to the extent requisite to enable them to readily succeed in productive co-operation; how can it be expected then that low-skilled inefficient labour should exhibit them? The enthusiastic co-operator says we must educate them up to the requisite moral and intellectual level. The answer is, that it is impossible to apply such educating influences effectually, until we have first placed them on a sound physical basis of existence; that is to say, until we have already cured the worst form of the malady. From whatever point we approach this question we are driven to the conclusion that as the true cause of the disease is an industrial one, so the earliest remedies must be rather industrial than moral or educational.

Sec. 4. Effects of Temperance and Technical Education.—Again, we are by no means justified in leaping to the conclusion that if we could induce workers to become more sober, more industrious, or more skilful, their industrial condition would of necessity be improved to a corresponding extent. If we can induce an odd farm-labourer here and there to give up his "beer," he and his family are no doubt better off to the extent of this saving, and can employ the money in some much more profitable way. But if the whole class of farm-labourers could be persuaded to become teetotalers without substituting some new craving of equal force in the place of drink, it is extremely probable that in all places where there was an abundant supply of farm-labourers, the wage of a farm-labourer would gradually fall to the extent of the sum of money formerly spent in beer. For the lowest paid classes of labourers get, roughly speaking, no more wages than will just suffice to provide them with what they insist on regarding as necessaries of life. To an ordinary labourer "beer" is a part of the minimum subsistence for less than which he will not consent to work at all. Where there is an abundance of labour, as is generally the case in low-skilled employments, this minimum subsistence or lowest standard of comfort practically determines wages. If you were merely to take something away from this recognized minimum without putting something else to take its place, you would actually lower the rate of wages. If, by a crusade of temperance pure and simple, you made teetotalers of the mass of low-skilled workers, their wages would indisputably fall, although they might be more competent workers than before. If, on the other hand, following the true line of temperance reform, you expelled intemperance by substituting for drink some healthier, higher, and equally strong desire which cost as much or more to attain its satisfaction; if in giving up drink they insisted on providing against sickness and old age, or upon better houses and more recreation and enjoyment, then their wages would not fall, and might even rise in proportion as their new wants, as a class, were more expensive than the craving for drink which they had abandoned.

Or, again, take the case of technical or general education. In so far as technical education enabled a number of men who would otherwise have been unskilled labourers, to compete for skilled work, it will no doubt enable these men to raise themselves in the industrial sense; but the addition of their number to the ranks of skilled labour will imply an increase in supply of skilled labour, and a decrease in supply of unskilled labour; the price or wage for unskilled labour will rise, but the wage for skilled labour will fall assuming the relationship between the demand for skilled and unskilled labour to remain as before. A mere increase in the efficiency of labour, though it would increase the quantity of wealth produced, and render a rise of wages possible, would of itself have no economic force to bring about a rise. No improvement in the character of labour will be effectual in raising wages unless it causes a rise in the standard of comfort, which he demands as a condition of the use of his labour. If we merely increased the efficiency of labour without a corresponding stimulation of new wants, we should be simply increasing the mass of labour-power offered for sale, and the price of each portion would fall correspondingly. It would confer no more direct benefit upon the worker as such, than does the introduction of some new machine which has the same effect of adding to the average efficiency of the worker. Those who would advocate technical and general education, with a view to the material improvement of the masses, must see that this education be applied in such a way as to assist in implanting and strengthening new wholesome demands in those educated, so as to effectively raise this standard of living. There can be little doubt but that such education would create new desires, and so would indirectly secure the industrial elevation of the masses. But it ought to be clearly recognized that the industrial force which operates directly to raise the wages of the workers, is not technical skill, or increased efficiency of labour, but the elevated standard of comfort required by the working-classes. It is at the same time true, that if we could merely stimulate the workers to new wants requiring higher wages, they could not necessarily satisfy all these new wants. If it were possible to induce all labourers to demand such increase of wages as sufficed to enable them to lay by savings, it is difficult to say whether they could in all cases press this claim successfully. But if at the same time their efficiency as labourers likewise grew, it will be evident that they both can and would raise that standard of living.

In so far as the results of technical education upon the class of low- skilled labourers alone is concerned, it is evident that it would relieve the constant pressure of an excessive supply. Whatever the effect of this might be upon the industrial condition of the skilled industries subjected to the increased competition, there can be no doubt that the wages of low-skilled labour would rise. Since the condition of unskilled or low-skilled workers forms the chief ingredient in poverty, such a "levelling up" may be regarded as a valuable contribution towards a cure of the worst phase of the disease.

This brief investigation of the working of moral and educational cures for industrial diseases shows us that these remedies can only operate in improving the material condition of the poorest classes, in so far as they conduce to raise the standard of living among the poor. Since a higher standard of comfort means economically a restriction in the number of persons willing to undertake work for a lower rate of wage than will support this standard of comfort, it may be said that moral remedies can be only effectual in so far as they limit the supply of low-skilled, low-paid labour. Thus we are brought round again to the one central point in the problem of poverty, the existence of an excessive supply of cheap labour.

Sec. 5. The False Dilemma which impedes Progress.—There are those who seek to retard all social progress by a false and mischievous dilemma which takes the following shape. No radical improvement in industrial organization, no work of social reconstruction, can be of any real avail unless it is preceded by such moral and intellectual improvement in the condition of the mass of workers as shall render the new machinery effective; unless the change in human nature comes first, a change in external conditions will be useless. On the other hand, it is evident that no moral or intellectual education can be brought effectively to bear upon the mass of human beings, whose whole energies are necessarily absorbed by the effort to secure the means of bare physical support. Thus it is made to appear as if industrial and moral progress must each precede the other, a thing which is impossible. Those who urge that the two forms of improvement must proceed pari passu, do not precisely understand what they propose.

The falsehood of the above dilemma consists in the assumption that industrial reformers wish to proceed by a sudden leap from an old industrial order to a new one. Such sudden movements are not in accordance with the gradual growth which nature insists upon as the condition of wise change. But it is equally in accordance with nature that the material growth precedes the moral. Not that the work of moral reconstruction can lag far behind. Each step in this industrial advancement of the poor should, and must, if the gain is to be permanent, be followed closely and secured by a corresponding advance in moral and intellectual character and habits. But the moral and religious reformer should never forget that in order of time material reform comes first, and that unless proper precedence be yielded to it, the higher ends of humanity are unattainable.



Chapter X.

"Socialistic Legislation."



Sec. 1. Legislation in restraint of "Free" Contract.—The direct pressure of certain tangible and painful forms of industrial grievance and of poverty has forced upon us a large mass of legislation which is sometimes called by the name of Socialistic Legislation. It is necessary to enter on a brief examination of the character of the various enactments included under this vague term, in order to ascertain the real nature of the remedy they seek to apply.

Perhaps the most typical form of this socialistic legislation is contained in the Factory Acts, embodying as they do a series of direct interferences in the interests of the labouring classes with freedom of contract between capital and labour.

The first of these Factory Acts, the Health and Morals Act, was passed in 1802, and was designed for the protection of children apprenticed in the rising manufacturing towns of the north, engaged in the cotton and woollen trades. Large numbers of children apprenticed by poor-law overseers in the southern counties were sent as "slaves" to the northern manufacturer, to be kept in overcrowded buildings adjoining the factory, and to be worked day and night, with an utter disregard to all considerations of physical or moral health. There is no page in the history of our nation so infamous as that which tells the details of the unbridled greed of these pioneers of modern commercialism, feeding on the misery and degradation of English children. This Act of 1802, enforcing some small sanitary reforms, prohibited night work, and limited the working-day of apprenticed children to twelve hours. In 1819, another Act was passed for the benefit of unapprenticed child workers in cotton mills, prohibiting the employment of children under nine years, and limiting the working-day to twelve hours for children between nine and sixteen. Sir John Cam Hobhouse in 1825 passed an Act further restricting the labour of children under sixteen years, requiring a register of children employed in mills, and shortening the work on Saturdays. Then came the agitation of Richard Oastler for a Ten Hours Bill. But Parliament was not ripe for this, and Hobhouse, attempting to redeem the hours in textile industries, was defeated by the northern manufacturers. Public feeling, however, formed chiefly by Tories like Oastler, Sadler, Ashley, and Fielden, drove the Whig leader, Lord Althorp, to pass the important Factory Act of 1833. This Act drew the distinction between children admitted to work below the age of thirteen, and "young persons" of ages from thirteen to eighteen; enforced in the case of the former attendance at school, and a maximum working week of forty-eight hours; in the case of the latter prohibited night work, and limited the hours of work to sixty-nine a week. The next step of importance was Peel's consolidating Factory Act of 1844, reducing the working-day for children to six and a half hours, and increasing the compulsory school attendance from two hours to three, and strengthening in various ways the machinery of inspection. In 1845 Lord Ashley passed a measure prohibiting the night work of women. In 1848, by the Act of Mr. Fielden, ten hours was assigned as a working-day for women and young persons, and further restrictions in favour of women and children were made in 1850 and 1853.

It must, however, be remembered that all the Factory legislation previous to 1860 was confined to textile factories—cotton, woollen, silk, or linen. In 1860, bleaching and dyeing works were brought within the Factory Acts, and several other detailed extensions were made between 1861 and 1864, in the direction of lace manufacture, pottery, chimney-sweeping, and other employments. But not until 1867 were manufactories in general brought under Factory legislation. This was achieved by the Factory Acts Extension Act, and the Workshops Regulation Act. For several years, however, the beneficial effects of this legislation was grievously impaired by the fact that local authorities were left to enforce it. Not until 1871, when the regulation and enforcement was restored to State inspectors, was the legislation really effectual. The Factory and Workshop Act of 1878, modified by a few more recent restrictions, is still in force. It makes an advance on the earlier legislation in the following directions. It prohibits the employment in any factory or workshop of children under the age of eleven, and requires a certificate of fitness for factory labour under the age of sixteen. It imposes the half-time system on all children, admitting, however, two methods, either of passing half the day in school, and half at work, or of giving alternate days to work and school. It recognizes a distinction between the severity of work in textile factories and in non-textile factories, assigning a working week of about fifty-six and a half hours to the former, and sixty hours to the latter. The exceptions of domestic workshops, and of many other forms of female and child employment, the permission of over-time within certain limitations, and the inadequate provision of inspection, considerably diminish the beneficial effects of these restrictive measures.

In 1842 Lord Ashley secured a Mining Act, which prohibited the underground employment of women, and of boys under ten years. In 1850 mine inspectors were provided, and a number of precautions enforced to secure the safety of miners. In 1864 several minor industries, dangerous in their nature, such as the manufacture of lucifer-matches, cartridges, etc., were brought under special regulations. To these restrictive pieces of legislation should be added the Employers' Liability Act, enforcing the liability of employers for injuries sustained by workers through no fault of their own, and the "Truck" legislation, compelling the payment of wages in cash, and at suitable places.

This slight sketch will suffice to mark the leading features of a large class of laws which must be regarded as a growth of State socialism.

The following points deserve special attention—

1. These measures are all forced on Parliament by the recognition of actual grievances, and all are testimony to the failure of a system of complete laissez faire.

2. They all imply a direct interference of the State with individual freedom—i.e. the worker cannot sell his labour as he likes; the capitalist cannot make what contracts he likes.

3. Though the protection of children and women is the strongest motive force in this legislative action, many of these measures interfere directly or indirectly with adult male labour—e.g. the limit on the factory hours of women and children practically limits the factory day for men, where the latter work with women or children. The clauses of recent Factory Acts requiring the "fencing of machinery" and other precautions, apply to men as well as to children and women. The Truck Act and Employers' Liability Act apply to male adult labour.

Sec. 2. Theory of this Legislation.—Under such legislation as the foregoing it is evident that the theory that a worker should be free to sell his labour as he likes has given way before the following considerations—

(1) That this supposed "freedom to work as one likes" often means only a freedom to work as another person likes, whether that other person be a parent, as in the case of children, or an employer, as in the case of adult workers.

(2) That a worker in a modern industrial community is not a detached unit, whose contract to work only concerns himself and his employer. The fellow-workers in the same trade and society at large have a distinct and recognizable interest in the conditions of the work of one another. A, by keeping his shop open on Sundays, or for long hours on week-days, is able to compel B, C, D, and all the rest of his trade competitors to do the same. A minority of workmen by accepting low wages, or working over-time, are often able to compel the majority to do the same. There is no labour-contract or other commercial act which merely regards the interest of the parties directly concerned. How far a society acting for the protection of itself, or of a number of its members, is justified in interfering between employer and workman, or between competing tradesmen, is a question of expediency. General considerations of the theoretic "freedom of contract," and the supposed "self-regarding" quality of the actions, are thus liable to be set aside by this socialistic legislation.

(3) These interferences with "free contract" of labour are not traceable to the policy of any one political party. The most valuable portions of the factory measures were passed by nominally Conservative governments, and though supported by a section of the Radical party, were strenuously opposed by the bulk of the Liberals, including another section of Radicals and political economists.

These measures signify a slow but steady growth of national sentiment in favour of securing for the poor a better life. The keynote of the whole movement is the protection of the weak. This appears especially in a recognition of the growing claims of children. Not only is this seen in the history of factory legislation, but in the long line of educational legislation, happily not ended yet. These taken together form a chain of measures for the protection of the young against the tyranny, greed, or carelessness of employers or parents. The strongest public sentiment is still working in this same direction. Recent agitation on the subject of prevention of cruelty to children, free dinners for school-children, adoption of children, child insurance, attest the growing strength of this feeling.

Sec. 3. General extension of Paternal Government.—The class of measures with which we have dealt recognizes that children, women, and in some cases men, are unable to look after their own interests as industrial workers, and require the aid of paternal legislation. But it must not be forgotten that the century has seen the growth of another long series of legislative Acts based also on the industrial weakness of the individual, and designed to protect society in general, adult or young, educated or uneducated, rich or poor. Among these come Adulteration Acts, Vaccination Acts, Contagious Diseases Acts, and the network of sanitary legislation, Acts for the regulation of weights and measures, and for the inspection of various commodities, licenses for doctors, chemists, hawkers, &c. Many of these are based on ancient historic precedents; we have grown so accustomed to them, and so thoroughly recognize the value of most of them, that it seems almost unnecessary to speak of them as socialistic measures. Yet such they are, and all of them are objected to upon this very ground by men of the political school of Mr. Herbert Spencer and Mr. Auberon Herbert. For it should be noted—

1. Each of these Acts interferes with the freedom of the individual. It compels him to do certain things—e.g. vaccinate his children, admit inspectors on his premises—and it forbids him to do certain other things.

2. Most of these Acts limit the utility to the individual of his capital, by forbidding him to employ it in certain ways, and hampering him with various restrictions and expenses. The State, or municipality, in certain cases—e.g. railways and cabs—even goes so far as to fix prices.

Sec. 4. State and Municipal Undertakings.—But the State does not confine itself to these restrictive or prohibitive measures, interfering with the free individual application of capital and labour, in the interests of other individuals, or of society at large. The State and the municipality is constantly engaged in undertaking new branches of productive work, thus limiting the industrial area left open to the application of private capitalist enterprise.

In some cases these public works exist side by side in competition with private enterprise; as, for example, in the carriage of parcels, life insurance, banking, and the various minor branches of post-office work, in medical attendance, and the maintenance of national education, and of places of amusement and recreation. In other cases it claims an absolute monopoly, and shuts off entirely private enterprise, as in the conveyance of letters and telegrams, and the local industries connected with the production and distribution of gas and water. The extent and complexity of that portion of our State and municipal machinery which is engaged in productive work will be understood from the following description—

"Besides our international relations, and the army, navy, police, and the courts of justice, the community now carries on for itself, in some part or another of these islands, the post-office, telegraphs, carriage of small commodities, coinage, surveys the regulation of the currency and note issue, the provision of weights and measures, the making, sweeping, lighting, and repairing of streets, roads, and bridges, life insurance, the grant of annuities, shipbuilding, stockbroking, banking, farming, and money-lending. It provides for many of us from birth to burial—midwifery, nursery, education, board and lodging, vaccination, medical attendance, medicine, public worship, amusements, and interment. It furnishes and maintains its own museums, parks, art galleries, libraries, concert-halls, roads, bridges, markets, slaughterhouses, fire-engines, lighthouses, pilots, ferries, surf-boats, steam-tugs, life-boats, cemeteries, public baths, washhouses, pounds, harbours, piers, wharves, hospitals, dispensaries, gas-works, water-works, tramways, telegraph-cables, allotments, cow-meadows, artisans' dwellings, schools, churches, and reading-rooms. It carries on and publishes its own researches in geology, meteorology, statistics, zoology, geography, and even theology. In our colonies the English Government further allows and encourages the communities to provide for themselves railways, canals, pawnbroking, theatres, forestry, cinchona farms, irrigation, leper villages, casinos, bathing establishments, and immigration, and to deal in ballast, guano, quinine, opium, salt, and what not. Every one of these functions, with those of the army, navy, police, and courts of justice, were at one time left to private enterprise, and were a source of legitimate individual investment of capital."[37]

Some of the utilities and conveniences thus supplied by public capital and public labour are old-established wants, but many are new wants, and the marked tendency of public bodies to undertake the provision of the new necessaries and conveniences which grow up with civilization is a phenomenon which deserves close attention.

Sec. 5. Motives of "Socialistic Legislation."—Stated in general terms, this socialistic tendency may be described as a movement for the control and administration by the public of all works engaged in satisfying common general needs of life, which are liable, if trusted to private enterprise, to become monopolies.

Articles which everybody needs, the consumption or use of which is fairly regular, and where there is danger of insufficient or injurious competition, if the provision be left to private firms, are constantly passing, and will pass more and more quickly, under public control. The work of protection against direct injuries to person and property has in all civilized countries been recognized as a dangerous monoply if left to private enterprise. Hence military, naval, police, and judicial work is first "socialized," and in modern life a large number of subsidiary works for the protection of the life and wealth of the community are added to these first public duties. Roads, bridges, and a large part of the machinery of communication or conveyance are soon found to be capable of abuse if left to private ownership; hence the post and telegraph is generally State-owned, and in most countries the railways. There is for the same reason a strong movement towards the municipal ownership of tramways, gas-and water-works, and all such works as are associated with monopoly of land, and are not open to adequate competition. In England everywhere these works are subject to public control, and the tendency is for this control, which implies part ownership, to develop into full ownership. Nearly half the gas-consumers in this country are already supplied by public works. One hundred and two municipalities own electric plant, forty-five own their tramway systems, one hundred and ninety-three their water supplies, at the close of 1902.

The receipts of local authorities from rates and other sources, including productive undertakings, had increased from seventy millions sterling to one hundred and forty-five millions between 1890-1 and 1901-2. Art galleries, free libraries, schools of technical education, are beginning to spring up on all sides. Municipal lodging-houses are in working at London, Glasgow, and several other large towns.

In every one of these cases, two forces are at work together, the pressure of an urgent public need, and the perception that private enterprise cannot be trusted to satisfy their need on account of the danger of monopoly. How far or how fast this State or municipal limitation of private enterprise and assumption of public enterprise will proceed, it is not possible to predict. Everything depends on the two following considerations—

First, the tendency of present private industries concerned with the supply of common wants of life to develop into dangerous monopolies by the decay of effective competition. If the forces at work in the United States for the establishment of syndicates, trusts, and other forms of monopoly, show themselves equally strong in England, the inevitable result will be an acceleration of State and municipal socialism.

Secondly, the capacity shown by our municipal and other public bodies for the effective management of such commercial enterprises as they are at present engaged in.

Reviewing then the mass of restrictive, regulative, and prohibitive legislation, largely the growth of the last half century, and the application of the State and municipal machinery to various kinds of commercial undertakings in the interest of the community, we find it implies a considerable and growing restriction of the sphere of private enterprise.

Sec. 6. The "Socialism" of Taxation—But there is another form of State interference which is more direct and significant than any of these. One of the largest State works is that of public education. Now the cost of this is in large measure defrayed by rate and tax, the bulk of which, in this case, is paid by those who do not get for themselves or for their children any direct return. The State-assisted education is said to tax A for the benefit of B. Nor is this a solitary instance; it belongs to the very essence of the modern socialistic movement. There is a strong movement, independent too of political partisanship, to cast, or to appear to cast, the burden of taxation more heavily upon the wealthier classes in order to relieve the poor. It is enough to allude to the income tax and the Poor Law. These are socialistic measures of the purest kind, and are directly open to that objection which is commonly raised against theoretic socialism, that it designs "to take from the rich in order to give to the poor." The growing public opinion in favour of graduated income tax, and the higher duty upon legacies and rich man's luxuries, are based on a direct approval of this simple policy of taking from the rich and giving to the poor.

The advocates of these measures urge this claim on grounds of public expediency, and those whose money is taken for the benefit of their poorer brethren, though they grumble, do not seriously impugn the right of the State to levy taxes in what way seems best. Whether we regard the whole movement from the taxation standpoint, or from the standpoint of benefits received, we shall perceive that it really means a direct and growing pressure brought to bear upon the rich for the benefit of the poor. A consideration of all the various classes of socialistic legislation and taxation to which we have referred, will show that we are constantly engaged more and more in the practical assertion and embodiment of the three following principles—

1. That the individual is often too weak or ignorant to protect himself in contract or bargain, and requires public protection.

2. That considerations of public interest are held to justify a growing interference with "rights of property."

3. That the State or municipality may enlarge their functions in any direction and to any extent, provided a clear public interest is subserved.

Sec. 7. Relation of Theoretic Socialism to Socialistic Legislation.—Now it has been convenient in speaking of this growth of State and municipal action to use the term Socialism. But we ought to be clear as to the application of this term. Although Sir William Harcourt declared, "We are all socialists to-day," the sober, practical man who is responsible for these "socialistic" measures, smiles at the saying, and regards it as a rhetorical exaggeration. He knows well enough that he and his fellow-workers are guided by no theory of the proper limits of government, and are animated by no desire to curtail the use of private property. The practical politician in this country is beckoned forward by no large, bright ideal; no abstract consideration of justice or social expediency supplies him with any motive force. The presence of close detailed circumstance, some local, concrete want to be supplied, some distinct tangible grievance to be redressed, some calculable immediate economy to be effected, such are the only conscious motives which push him forward along the path we have described. An alarming outbreak of disease registered in a high local death-rate presses the question of sanitary reform, and gives prominence to the housing of the working-classes. The bad quality of gas, and the knowledge that the local gas company, having reached the limit of their legal dividend, are squandering the surplus on high salaries and expensive offices, leads to the municipalization of the gas-works. The demand made upon the ratepayers of Bury to expend; L60,000 on sewage-works, a large proportion of which would go to increase the ground value of Lord Derby's property, leads them to realize the justice and expediency of a system of taxation of ground values which shall prevent the rich landlord from pocketing the contribution of the poor ratepayer. So too among those directly responsible for State legislation, it is the force of public opinion built out of small local concrete grievances acting in coalition with a growing sentiment in favour of securing better material conditions for the poor, that drafts these socialistic bills, and gets them registered as Acts of Parliament.

But the student of history must not be deceived into thinking that principles and abstract theories are not operative forces because they appear to be subordinated to the pressure of small local or temporal expediencies. Underneath these detailed actions, which seem in large measure the product of chance, or of the selfish or sentimental effort of some individual or party, the historian is able to trace the underworking of some large principle which furnishes the key to the real logic of events. The spirit of democracy has played a very small part in the conscious effort of the democratic workers. But the inductive study of modern history shows it as a force dominating the course of events, directing and "operating" the minor forces which worked unconsciously in the fulfilment of its purpose. So it is with this spirit of socialism. The professed socialist is a rare, perhaps an unnecessary, person, who wishes to instruct and generally succeeds in scaring humanity by bringing out into the light of conscious day the dim principle which is working at the back of the course of events. Since this conscious socialism is not an industrial force of any great influence in England, it is not here necessary to discuss the claim of the theoretic socialist to provide a solution for the problem of poverty. But it is of importance for us to recognize clearly the nature of the interpretation theoretic socialists place upon the order of events set forth in this chapter, for this interpretation throws considerable light on the industrial condition of labour.

We see that the land nationalizer claims to remove, and the land reformer in general to abate, the evil of poverty by securing for those dependent on the fluctuating value and uncertain tenure of wage-labour an equal share in those land-values, the product of nature and social activity, which are at present monopolized by a few. Now the quality of monopoly which the land nationalizer finds in land, the professed socialist finds also in all forms of capital. The more discreet and thoughtful socialist in England at least does not deny that the special material forms of capital, and the services they render, may be in part due to the former activity of their present owners, or of those from whom their present owners have legitimately acquired them; but he affirms that a large part of the value of these forms of capital, and of the interest obtained for their use, is due to a monopoly of certain opportunities and powers which are social property just as much as land is. The following statement by one of the ablest exponents of this doctrine will explain what this claim signifies—

"We claim an equal right to this 'inheritance of mankind,' which by our institutions a minority is at present enabled to monopolize, and which it does monopolize and use in order to extort thereby an unearned increment; and this inheritance is true capital. We mean thereby the principle, potentiality, embodied in the axe, the spade, the plough, the steam-engine, tools of all kinds, books or pictures, bequeathed by thinkers, writers, inventors, discoverers, and other labourers of the past, a social growth to which all individual claims have lapsed by death, but from the advantages of which the masses are virtually shut out for lack of means. The very best definition of government, even that of to-day, is that it is the agency of society which procures title to this treasure, stores it up, guards and gives access to it to every one, and of which all must make the best use, first and foremost by education."

The conscious socialist is he who, recognizing in theory the nature of this social property inherent in all forms of capital, aims consciously at getting possession or control of it for society, in order to solve the problem of poverty by making the wage-earner not only a joint-owner of the social property in land but also in capital.

In other words, it signifies that the community refuses to sanction any absolute property on the part of any of its members, recognizing that a large portion of the value of each individual's work is due, not to his solitary efforts, but to the assistance lent by the community, which has educated and secured for the individual the skill which he puts in his work; has allowed him to make use of certain pieces of the material universe which belongs to society; has protected him in the performance of his work; and lastly, by providing him a market of exchange, has given a social value to his product which cannot be attributed to his individual efforts. In recognition of the co-operation of society in all production of wealth, the community claims the right to impose such conditions upon the individual as may secure for it a share in that social value it has by its presence and activity assisted to create. The claim of the theoretic socialist is that society by taxing or placing other conditions upon the individual as capitalist or workman is only interfering to secure her own. Since it is not possible to make any satisfactory estimate of the proportion of any value produced which is due to the individual efforts, and to society respectively, there can be no limit assigned to the right of society to increase its claim save the limit imposed by expediency. It will not be for the interest of society to make so large a claim by way of regulation, restriction, or taxation, as shall prevent the individual from applying his best efforts to the work of production, whether his function consists in the application of capital or of labour. The claims of many theoretic socialists transcend this statement, and claim for society a full control of all the instruments of production. But it is not necessary to discuss this wider claim, for the narrower one is held sufficient to justify and explain those slow legislative movements which come under the head of practical socialism, as illustrated in modern English history.

Now while this conscious socialism has no large hold in England, it is necessary to admit that the doctrine just quoted does furnish in some measure an explanation of the unconscious socialism traceable in much of the legislation of this century. When it is said that "we are all socialists to-day," what is meant is, that we are all engaged in the active promotion or approval of legislation which can only be explained as a gradual unconscious recognition of the existence of a social property in capital which it is held politic to secure for the public use.

The increasing restrictions on free use of capital, the monopoly of certain branches of industry by the State and the municipality, the growing tendency to take money from the rich by taxation, can be explained, reconciled, and justified on no other principle than the recognition that a certain share of the value of these forms of wealth is due to the community which has assisted and co-operated with the individual owner in its creation. Whether the socialistic legislation which, stronger than all traditions of party politics, is constantly imposing new limitations upon the private use of capital, is desirable or not, is not the question with which we are concerned. It is the fact that is important. Society is constantly engaged in endeavouring, feebly, slowly, and blindly, to relieve the stress of poverty, and the industrial weakness of low-skilled labour, by laying hands upon certain functions and certain portions of wealth formerly left to private individuals, and claiming them as social functions and social wealth to be administered for the social welfare. This is the past and present contribution of "socialistic legislation" towards a solution of the problem of poverty, and it seems not unlikely that the claims of society upon these forms of social property will be larger and more systematically enforced in the future.



Chapter XI.

The Industrial Outlook of Low-Skilled Labour.



Sec. 1. The Concentration of Capital.—It must be remembered that we have been concerned with what is only a portion of the great industrial movement of to-day. Perhaps it may serve to make the industrial position of the poor low-skilled workers more distinct if we attempt to set this portion in its true relation to the larger Labour Problem, by giving a brief outline of the size and relation of the main industrial forces of the day.

If we look at the two great industrial factors, Capital and Labour, we see a corresponding change taking place in each. This change signifies a constant endeavour to escape the rigour of competition by a co-operation which grows ever closer towards fusion of interests previously separate.

Look first at Capital. We saw how the application of machinery and mechanical power to productive industries replaced the independent citizen, or small capitalist, who worked with a handful of assistants, by the mill and factory owner with his numerous "hands." The economic use of machinery led to production on a larger scale. But new, complex, and expensive machinery is continually being invented, which, for those who can afford to purchase and use it, represents a fresh economy in production, and enables them both to produce larger quantities of goods more rapidly, and to get rid of them by underselling those of their trade competitors who are working with old-fashioned and less effective machinery. As this process is continually going on, it signifies a constant advantage which the owner of a large business capital has over the owner of a smaller capital. In earlier times, when trade was more localized, and the small manufacturer or merchant had his steady customers, and stood on a slowly and carefully acquired reputation, it was not so easy for a new competitor to take his trade by the offer of some small additional advantage. But the opening up of wider communication by cheap postage, the newspaper, the railway, the telegraph, the general and rapid knowledge of prices, the enormous growth of touting and advertising, have broken up the local and personal character of commerce, and tend to make the whole world one complete and even arena of competition. Thus the fortunate possessor of some commercial advantage, however trifling, which enables him to produce more cheaply or sell more effectively than his fellows, can rapidly acquire their trade, unless they are able to avail themselves of the new machinery, or special skill, or other economy which he possesses. This consideration enables the large capitalist in all businesses where large capital contains these advantages, or the owner of some large natural monopoly, who can most cheaply extract large quantities of raw material, to crush in free competition the smaller businesses. In proportion as business is becoming wider and more cosmopolitan, these natural advantages of large capital over small are able to assert themselves more and more effectively. In certain branches of trade, which have not yet been taken over by elaborate machinery, or where everything depends upon the personal activity and intelligence, and the detailed supervision of a fully interested owner, the small capitalist may still hold his own, as in certain branches of retail trade. But the general movement is in favour of large businesses. Everywhere the big business is swallowing up the smaller, and in its turn is liable to be swallowed by a bigger one. In manufacture, where the cosmopolitan character is strongest, and where machinery plays so large a part, the movement towards vast businesses is most marked; each year makes it more rapid, and more general. But in wholesale and retail distribution, though somewhat slower, the tendency is the same. Even in agriculture, where close personal care and the limitations of a local market temper the larger tendency, the recent annals of Western America and Australia supply startling evidence of the concentrative force of machinery. The meaning of this movement in capital must not be mistaken. It is not merely that among competing businesses, the larger showing themselves the stronger survive, and the smaller, out-competed disappear. This of course often happens. The big screw-manufacturer able to provide some new labour-saving machinery, to advertise more effectively, or even to sell at a loss for a period of time, can drown his weaker competitors and take their trade. The small tradesman can no longer hold his own in the fight with the universal provider, or the co-operative store.

But this destruction of the small business, though an essential factor in the movement, is not perhaps the most important aspect. The industrial superiority of the large business over the small makes for the concentration both of small capitals and of business ability. The monster millionaire, who owns the whole or the bulk of his great business, is after all a very rare specimen. The typical business form of to-day is the joint stock company. This simply means that a number of capitalists, who might otherwise have been competing with one another on a small scale of business, recognizing the advantage of size, agree to mass their capital into one large lump, and to entrust its manipulation to the best business ability they can muster among them, or procure from outside. This process in its simplest form is seen in the amalgamation of existing and competing businesses, notable examples of which have recently occurred in the London publishing trade. But the ordinary Company, whether it grows by the expansion of some large existent business, or, like most railways or other new enterprises, is formed out of money subscribed in order to form a business, represents the same concentrating tendency. These share-owners put their capital together into one concern, in order to reap some advantage which they think they would not reap if they placed the capital in small competing businesses. But though it has been calculated that about one-third of English commerce is now in the hands of joint stock companies, this by no means exhausts the significance of the centralizing force in capital. Almost all large businesses, and many small businesses, are recognized to be conducted largely with borrowed capitals. The owners of these debentures are in fact joint capitalists with the nominal owner of the business. They prefer to lend their capital, because they hope to enjoy a portion of the gain and security which belongs to a large business as compared with a small one. Along with this coming together of small capitals to make a large capital, there is a constant centralization and organization of business ability. It is not uncommon for the owner of a small and therefore failing business to accept a salaried post in the office of some great business firm. So too we find the son of a small tradesman, recognizing the hopelessness of maintaining his father's business, takes his place behind the counter of some monster house.

Sec. 2. How Competition affects Capital.—Now the force which brings about all these movements is the force of competition. Every increase of knowledge, every improvement of communication, every breakdown of international or local barriers, increases the advantage of the big business, and makes the struggle for existence among small businesses more keen and more hopeless. It is the desire to escape from the heavy and harassing strain of trade competition, which practically drives small businesses to suspend their mutual hostilities, and to combine. It is true that most of the large private businesses or joint stock companies are not formed by this direct process of pacification. But for all that, their raison d'etre is found in the desire to escape the friction and waste of competition which would take place if each shareholder set up business separately on his own account. We shall not be surprised that the competition of small businesses has given way before co-operation, when we perceive the force and fierceness of the competition between the larger consolidated masses of capital. With the development of the arts of advertising, touting, adulteration, political jobbery, and speculation, acting over an ever-widening area of competition, the fight between the large joint stock businesses grows always more cruel and complex. Business failures tend to become more frequent and more disastrous. A recent French economist reckons that ten out of every hundred who enter business succeed, fifty vegetate, and forty go into bankruptcy. In America, where internal competition is still keener and speculation more rife, it has been lately calculated that ninety-five per cent, of those who enter business "fail of success." Just as in the growth of political society the private individual has given up the right of private war to the State, with the result that as States grow stronger and better organized, the war between them becomes fiercer and more destructive, so is it with the concentration of capital. The small capitalist, seeking to avoid the strain of personal competition, amalgamates with others, and the competition between these masses of capital waxes every day fiercer. We have no accurate data for measuring the diminution of the number of separate competitors which has attended the growing concentration of capital, but we know that the average magnitude of a successful business is continually increasing. The following figures illustrate the meaning of this movement from the American cotton trade, which is not one of the industries most susceptible to the concentrative pressure. "It will be seen that in 756 large establishments in 1880, in which the aggregate capital invested was five times as great as that in the 801 establishments in 1830, the capital invested per spindle was one-third less, the number of spindles operated by each labourer nearly three times as large, the product per spindle one-fourth greater, the product per dollar invested twice as large, the price of the cotton cloth nearly sixty per cent, less, the consumption per capita of the population over one hundred per cent greater, and the wages more than double. What is true of this industry is true of all industries where the concentration of capital has taken place."[38]

It is needless to add that these large works are conducted, not by single owners, but in nearly all cases by the managers of associated capitals. Regarded from the large standpoint of industrial development, all these phenomena denote a change in the sphere of competition. From the competition of private capitals owned by individuals we have passed to the competition of associated capitals. The question now arises, "Will not the same forces, which, in order to avoid the waste and destruction of ever keener competition, compelled the private capitalists to suspension of hostility and to combination, act upon the larger masses of associated capital?" The answer is already working itself clearly out in industrial history. The concentrative adhesive forces are everywhere driving the competing masses of capital to seek safety, and escape waste and destruction, by welding themselves into still larger masses, renouncing the competition with one another in order to compete more successfully with other large bodies. Thus, wherever these forces are in free operation, the number of competing firms is continually growing less; the surviving competitors have crushed or absorbed their weaker rivals, and have grown big by feeding on their carcases.

But the struggle between these few big survivors becomes more fierce than ever. Fitted out with enormous capital, provided with the latest, most complex, and most expensive machinery, producing with a reckless disregard for one another or the wants of the consuming public, advertising on a prodigious scale in order to force new markets, or steal the markets of one another, they are constantly driven to lower their prices in order to effect sales; profits are driven to a minimum; all the business energy at their command is absorbed by the strain of the fight; any unforeseen fluctuations in the market brings on a crisis, ruins the weaker combatants, and causes heavy losses all round. In trades where the concentrative process has proceeded furthest this warfare is naturally fiercest. But as the number of competing units grows smaller, arbitration or union becomes more feasible. Close and successful united action among a large number of scattered competitors of different scales of importance, such as exist during the earlier stage of capitalism, would be impossible. But where the number is small, combination presents itself as possible, and in so much as the competition is fiercer, the direct motive to such combination is stronger. Hence we find that attempts are made to relieve the strain among the largest businesses. The fiercest combatants weary of incessant war and patch up treaties. The weapon of capitalist warfare is the power of under-selling—"cutting prices." The most powerful firms consent to sheathe this weapon, i.e. agree not to undersell one another, but to adopt a common scale of prices. This action, in direct restraint of competition, corresponds to the action of a trades union, and is attained by many trades whose capital is not large or business highly developed. Neither does it imply close union of friendly relations between the combining parties. It is a policy dictated by the barest instinct of self-preservation. We see it regularly applied in certain local trades, especially in the production and distribution of perishable commodities. Our bakers, butchers, dairy-men, are everywhere in a constant state of suspended hostility, each endeavouring indeed to get the largest trade for himself, but abiding generally by a common scale of prices. Wherever the local merchants are not easily able to be interfered with by outsiders, as in the coal-trade, they form a more or less closely compacted ring for the maintenance of common terms, raising and lowering prices by agreement. The possibility of successfully maintaining these compacts depends on the ability to resist outside pressure, the element of monopoly in the trade. When this power is strong, a local ring of competing tradesmen may succeed in maintaining enormous prices. To take a humble example—In many a remote Swiss village, rapidly grown into a fashionable resort, the local washerwomen are able to charge prices twice as high as those paid in London, probably four times as high as the normal price of the neighbourhood.

Grocers or clothiers are not able to combine with the same effect, for the consumer is far less dependent on local distribution for these wares. But wherever such retail combinations are possible they are found. Among large producers and large distributing agencies the same tendency prevails, especially in cases where the market is largely local. Free competition of prices among coal-owners or iron-masters gives way under the pressure of common interests, to a schedule of prices; competing railways come to terms. Even among large businesses which enjoy no local monopoly, there are constant endeavours to maintain a common scale of prices. This condition of loose, irregular, and partial co-operation among competing industrial units is the characteristic condition of trade in such a commercial country as England to-day. Competitors give up the combat a outrance, and fight with blunted lances.

Sec. 3. Syndicates and Trusts.—But it is of course extremely difficult to maintain these loose agreements among merchants and producers engaged in intricate and far-reaching trades. A big opportunity is constantly tempting one of them to undersell; new firms are constantly springing up with new machinery, willing to trade upon the artificially raised prices, by under-selling so as to secure a business; over-production and a glut of goods tempts weaker firms to "cut rates," and this breaks down the compact. A score of different causes interfere with these delicate combinations, and plunge the different firms into the full heat and waste of the conflict. The renewed "free competition" proves once more fatal to the smaller businesses; the waste inflicted on the "leviathans" who survive forms a fresh motive to a closer combination.

These new closer combinations are known by the names of Syndicate and Trust. This marks another stage in the evolution of capital. In the United States, where the growth is most clearly marked, the Standard Oil Trust forms the leading example of a successful Trust. In 1881, this Standard Oil Company having maintained for some ten years tolerably close informal relations with its leading competitors in the Eastern States, and having crushed out the smaller companies, entered into a close arrangement with the remaining competitors, with the view of a practical consolidation of the businesses into one, though the formal identity of the several firms was still maintained. The various companies which entered into this union, comprising nearly all the chief oil-mills, submitted their businesses to valuation, and placed themselves in the hands of a board of trustees, with an absolute power to regulate the quantity of production, and if necessary to close mills, to raise and lower prices, and to work the whole number as a joint concern. Each company gave up its shares to the Trust, receiving notes of acknowledgment for the worth of the shares, and the total profits were to be divided as dividend each half-year. This Trust has continued to exist, and has now a practical monopoly of the oil trade in America, controlling, it is reckoned, more than 90 per cent. of the whole market, and regulating production and prices.

Everywhere this process is at work. Competing firms are in every trade, where their small numbers permit, striving to come to closer terms than formerly, and either secretly or openly joining forces so as to get full control over the production or distribution of some product, in order to manipulate prices for their own profit. From railways and corn-stores down to slate-pencils, coffins, and sticking-plaster, everything is tending to fall under the power of a Trust. Many of these Trusts fail to secure the union of a sufficient proportion of the large competitors, or quarrels spring up among the combining firms, or some new firms enter into competition too strong to be fought or bought over. In these ways a large number of the Trusts have hitherto broken down, and will doubtless continue to break down. In England, this step in capitalist evolution is only beginning to be taken. In glass, paper, salt, coal, and a few other commodities, combinations more permanent than the mere Ring or Corner, and closer than the ordinary masters' unions, have been formed. But Free Trade, which leaves us open to the less calculable and controllable element of foreign competition, and the fact that the earlier stages of concentration of capital are not yet completed here in most trades, have hitherto retarded the growth of the successful Trust in England. Even in America there is no case where the monopoly of a Trust reigns absolute through the whole country, though many of them enjoy a local control of production and prices which is practically unrestricted. Excepting in the case of the Standard Oil Trust, and a few less important bodies which enjoy the control of some local monopoly, such as anthracite coal, the supremacy of the leading Trust or Syndicate is brought in certain places into direct conflict with other more or less independent competing bodies. In other words, the evolution of capital, which tends ever to the establishment of competition between a smaller number of larger masses, has nowhere worked out the logical conclusion which means the condensation of the few large competing bodies into a single mass. This final step, which presents a completely organized trade with the element of competition utterly eliminated under the control of a single body of mere joint-owners of the capital engaged, must be regarded as the goal, the ideal culmination of the concentrative movement of modern capital. It is said that more than one-third of the business in the United States is already controlled by Trusts. But most of them have only in part succeeded in their effort to escape from competition by integrating their personal interests into a single homogeneous mass. Even in cases where they do rule the market untrammelled by the direct interference of any competitors, they are still deterred from a free use of their control over prices by the possibility of competition which any full use of this control might give rise to. For it does not follow that even where a Trust holds an absolute monopoly of the market of a locality, that it will be able to maintain that monopoly were it to raise its prices beyond a certain point. In proportion, however, as experience yields a greater skill in the management of Trusts, and their growing strength enables them to more successfully defy outside attempts at competition, their power to raise prices and increase their rates of profit would rise accordingly.

Regarding, then, the development of the capitalist system from the first establishment of the capitalist-employer as a distinct industrial class, we trace the massing of capital in larger and larger competing forms, the number of which represents a pyramid growing narrower as it ascends towards an ideal apex, represented by the absolute unity or identity of interests of the capital in a given trade. In so far as the interests of different trades may clash, we might carry on this movement further, and trace the gradual agreement, integration, and fusion of the capitals represented in various trades. There is, in fact, an ever-growing understanding and union between the various forms of capital in a country. The recognition of this ultimate identity of interest must be regarded as a constant force making for the unification of the whole capital of a country, in the same way as the common interests of directly competing capitals in the same trade leads to a union for mutual support and ultimate identification.