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Problems of Poverty by John A. Hobson

Part 3 out of 4

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2. Closely related to this first difficulty is the fact that Mr. Booth
provides no real suggestion for a process of discrimination in the
treatment of our social failures, which shall distinguish the failure
due directly to deep-seated vice of character and habit, from the
failure due to unhappy chance or the fault of others. Difficult, almost
impossible, as such discrimination between deserving and undeserving is,
it is felt that any genuine reform of our present poor law system
demands that some attempt in this direction should be made. We must try
to distinguish curable from incurable cases, and we must try to cure the
former while we preserve society from the contamination of the latter.
The mere removal of a class of "very poor" will not suffice.

Since however the scheme of Mr. C. Booth does not proceed beyond the
stage of a suggested outline of treatment, it is not fair or profitable
to press close criticism. It is, however, a fact of some significance
that one who has brought such close study to bear upon the problem of
poverty should arrive at the conclusion that "Thorough interference on
the part of the State with the lives of a small fraction of the
population, would tend to make it possible, ultimately, to dispense with
any Socialistic interference in the lives of all the rest."[33]

Sec. 5. Proposed remedies for "Unemployment."--In discussing methods of
dealing with "the unemployed," who represent an "over-supply" of labour
at a given time, it is often found convenient to distinguish the
temporary "unemployment" due to fluctuations rising from the nature of
certain trades, and the permanent unemployment or half employment of
large numbers of the least efficient town workers. The fluctuations in
employment due to changes of season, as in the building trades, and many
branches of dock labour, or to changes of fashion, as in the silk and
"fancy" woollen trade, or to temporary changes in the field of
employment caused by a transformation of industrial processes, are
direct causes of a considerable quantity of temporary unemployment. To
these must be added the unemployment represented by the interval between
the termination of one job and the beginning of another, as in the
building trades. Lastly, the wider fluctuations of general trade seem to
impose a character of irregularity upon trade, so that the modern System
of industry will not work without some unemployed margin, some reserve
of labour.

These irregularities and leakages seem to explain why, at any given
time, a certain considerable number of fairly efficient and willing
workmen may be out of work. It is often urged that this class of
"unemployed" must be regarded as quite distinct from the superfluity of
low-skilled and inefficient workers found in our towns, and that the two
classes present different problems for solution. The character of the
"chronic" class of unemployed makes the problem appear to be, not one of
economic readjustment, but rather of training and education. But this
appearance is deceptive. The connection between the two kinds of
"unemployment" is much closer than is supposed. The irregularity of the
"season" and "fashion" trades, the periodic spells of bad trade, are
continually engaged in degrading and deteriorating the physique, the
morale, and the industrial efficiency of the weaker members of each
trade: these weaklings are unable to maintain a steady and healthy
standard of life under economic conditions which make work and wages
irregular, and are constantly dropping out of the more skilled trades to
swell the already congested low-skilled labour market. Every period of
"depressed trade" feeds the pool of low-skilled labour from a hundred
different channels. The connection between the two classes of
"unemployed" is, therefore, a close and vital one. To drain off this
pool would, in fact, be of little permanent use unless those
irregularities of trade, which are constantly feeding it, are also

Still less serviceable are those schemes of rescuing "the unemployed,"
which, in the very work of rescue, engender an economic force whose
operation causes as much unemployment as it cures. A signal example of
this futile system of social drainage has been afforded by certain
experiments of the Salvation Army in their City Works and Farm Colony.
The original draft of the scheme contained in the volume, _In Darkest
England_, clearly recognized the advisability of keeping the bounty-fed
products of the Salvation Colonies from competition in the market with
the products of outside labour. The design was to withdraw from the
competitive labour market certain members of "the unemployed," to train
and educate them in efficient labour, and to apply this labour to
capital provided out of charitable funds: the produce of this labour was
to be consumed by the colonists themselves, who would thus become as far
as possible self-supporting; in no case was it to be thrown upon the
open market. As a matter of fact these sound, economic conditions of
social experiment have been utterly ignored. Matches, firewood,
furniture, etc. produced in the City factories have been thrown upon the
open market. The Hadleigh Farm Colony, originally designed to give a
thorough training in the arts of agriculture so as to educate its
members for the Over Sea Colony, has devoted more and more attention to
shoemaking, carpentering, and other special mechanical crafts, and less
and less to the efficient cultivation of the soil; the boots, chairs,
etc. being thrown in large quantities upon the open market. Moreover,
the fruit and vegetables raised upon the Farm have been systematically
placed upon the outside market. The result of such a line of conduct is
evident. Suppose A is a carpenter thrown out of work because there are
more carpenters than are required to turn out the current supply of
chairs and tables at a profitable price; the Salvation Army takes A in
hand, and provides him with capital upon which no interest need be paid.
A's chairs, now thrown on the market, can undersell the chairs provided
by B, C, D, his former trade competitors. Unless we suppose an increased
demand for chairs, the result is that A's chairs displace those of B in
the market, and B is thrown out of employment. Thus A, assisted by the
Salvation Army, has simply taken B's work. If the Salvation Army now
takes B in hand, it can engage him in useful work on condition that he
takes away the work of C. If match-makers are thrown out of work by
trade conditions, and the Salvation Army places them in a factory, and
sells in the open market the matches which they make, the public which
buys these matches abstains from buying the matches made by other firms,
and these firms are thus prevented from employing as much labour as they
would otherwise have done. No net increase of employment is caused by
this action of the Salvation Army, and therefore they have done nothing
towards the solution of the unemployed problem. They have provided
employment for certain known persons at the expense of throwing out of
employment certain other unknown persons. Since those who are thrown out
of work in the labour market are, on the average, inferior in character
and industry to those who are kept in work, the effect of the Salvation
Army policy is to substitute inferior for superior workers. The blind
philanthropist may perhaps be excused for not seeing beyond his nose,
and for ignoring "unseen" in favour of "seen" results. But General Booth
was advised of the sound economic conditions of his experiment, and
seemed to recognize the value of the advice. The defence of his action
sometimes takes the form of a denial that the Salvation Army undersells
outside produce in the market. Salvation matches are sold, it is said,
rather above than below the ordinary price of matches. If this be true,
it affords no answer to the objection raised above. The Salvation
matches are bought by persons who would have bought other matches if
they had not bought these, and if they choose to pay 3d. for Salvation
matches instead of 21/2d. for others, the effect of this action is still
to take away employment from the 21/2d. firm and give it to the Salvation
firm. Indeed, it might be urged that a larger amount of unemployment is
caused in this case, for persons who now pay 3d. for matches which they
formerly bought for 21/2d., will diminish their expenditure upon other
commodities, and the result will be to diminish employment in those
industries engaged in supplying these commodities. Here is another
"unseen" result of fallacious philanthropy.

The inevitable result of the Salvation Army placing goods in the open
market is to increase the supply relatively to the demand; in order that
the larger supply may be sold prices must fall, and it makes no
difference whether or no the Salvation Army takes the lead in reducing
the price. If the fall of price enables the whole of the increased
supply to be taken off at the lower price, then an increase of
employment has been obtained in this trade, though, in this case, it
should be remembered that in all probability the lower level of prices
means a reduction of wages in the outside labour market. If the
increased supply is not taken off at the lower prices, then the
Salvation goods can only be sold on condition that some others remain
unsold, employment of Salvationists thus displacing employment of other
workers. The roundabout nature of much of this competition does not
impair one whit the inevitability of this result.

This objection is applicable not only to the method of the Salvation
Army, but to many other industrial experiments conducted on a
philanthropic basis. Directly or indirectly bounty-fed labour is brought
into competition with self-supporting labour to the detriment of the
latter. It is sometimes sought to evade the difficulty by confining the
produce which the assisted labour puts upon the open market to classes
of articles which are not for the most part produced in this country,
but which are largely imported from abroad. It is urged that although
shoes and furniture and matches ought not to be produced by assisted
labour for the outside market, it is permissible for an agricultural
colony to replace by home products the large imports in the shape of
cheese, fruit, bacon, poultry, etc., which we now receive from abroad.
Those who maintain this position commonly fail to take into
consideration the exports which go out from this country to pay for
these imports. If this export trade is diminished the trades engaged in
manufacturing the exported goods will suffer, and labour employed in
these trades may be thrown out of employment. This objection may be met
by showing that the goods formerly exported, or an equivalent quantity
of other goods, will be demanded for the increased consumption of the
labourers in the agricultural colony. This is a valid answer if the home
consumption rises sufficiently to absorb the goods formerly exported to
pay for agricultural imports. But even where this just balance is
maintained, allowance must be made for some disturbance of established
trades owing to the fact that the new demand created at home will
probably be for different classes of articles from those which formed
the exports now displaced. The safest use of assisted labour, where the
products are designed for the open market, is in the production of
articles for which there is a steadily growing demand within this
country. Even in this case the utmost care should be exercised to
prevent the products of assisted labour from so depressing prices as to
injure the wages of outside labour engaged in similar productions.

Since the existence of an unemployed class who are unemployed because
they are unable, not because they are unwilling, to get work, is proof
of an insufficiency of employment, it is apparent that nothing is of
real assistance which does not increase the net amount of employment.
Since the amount of employment is determined by, and varies with, the
consumption of the community, the only sure method of increasing the
amount of employment is by raising the standard of consumption for the
community. Where, as is common in times of trade depression,
unemployment of labour is attended by unemployment of capital, this
joint excess of the two requisites of production is only to be explained
by the low standard of consumption of the community. Since the working-
classes form a vast majority of the community, and their standard of
consumption is low compared with that of the upper classes, it is to a
progressive standard of comfort among the workers that we must look for
a guarantee of increasing employment. It may be urged that the luxurious
expenditure of the rich provides as much employment as the more
necessary expenditure of the poor. But, setting aside all considerations
of the inutility or noxious character of luxury, there is one vital
difference between the employment afforded in the two cases. The demand
for luxuries is essentially capricious and irregular, and this
irregularity must always be reflected in the employment of the trades
which supply them. On the other hand, a general rise in the standard of
comfort of the workers creates an increased demand of a steady and
habitual kind, the new elements of consumption belonging to the order of
necessaries or primary comforts become ingrained in the habits of large
classes of consumers, and the employment they afford is regular and
reliable. When this simple principle is once clearly grasped by social
reformers, it will enable them to see that the only effective remedy for
unemployment lies in a general policy of social and economic reform,
which aims at placing a larger and larger proportion of the "consuming
power" of the community in the hands of those who, having received it as
the earnings of their effort, will learn to use it in building up a
higher standard of wholesome consumption.

Chapter VIII.

The Industrial Condition of Women-Workers.

Sec. 1. The Number of Women engaged in Industrial Work.--The evils of
"sweating" press more heavily on women workers than on men. It is not
merely that women as "the weaker sex" suffer more under the same burden,
but that their industrial burden is absolutely heavier than that of men.
The causes and the meaning of this demand a special treatment.

The census returns for 1901 showed that out of 4,171,751 females engaged
in occupations about 401/2 per cent. were in domestic or other service,
381/2 per cent. in manufactures, 7 per cent. in commerce, chiefly as shop-
assistants, 4 per cent. in teaching, 3 per cent. in hotels, boarding-
houses, etc., and 7 per cent. in other occupations.

The following table gives the groups of occupations in which more
females are employed than males:--

Occupational Groups Males Females
Sick nurses, midwives, etc. 1,092 67,269
Teaching 61,897 172,873
Domestic service 124,263 1,690,686
Bookbinding: paper and stationery manufactures 42,644 64,210
Textile manufactures 492,175 663,222
Dress manufactures 336,186 689,956
1,058,257 3,348,216
All other occupations 9,098,717 823,535
All occupations 10,156,974 4,171,751

The manufactures in which women have been gaining upon men are the
textile and clothing trades in almost all branches, tobacco, printing,
stationery, brushes, india-rubber, and foods.

Sec. 2. Women's Wages.--Turning now to women engaged in city industries,
let us gauge their industrial condition by the tests of wages, hours of
labour, sanitary conditions, regularity of employment

The following is a list of the average wages paid for different kinds of
factory work in London.

Artificial flowers 8 to 12 shillings.
Bookbinding 9 " 11 "
Boxmaking 8 " 16 "
Brushes 8 " 15 "
Caps 8 " 16 "
Collars 11 " 15 "
Confectionery 8 " 14 "
Corsets 8 " 16 "
Fur-sewing 7 " 14 "
Fur-sewing in winter 4 " 7 "
Matches 8 " 13 "
Rope 8 " 11 "
Umbrellas 10 " 18 "

These are ordinary wages. Very good or industrious workers are said to
get in some cases 20 per cent, more; unskilful or idle workers less.

It must be borne in mind that these sums represent a full week's work.
The importance of this qualification will appear presently.

It is obvious at a glance that these wages are for the most part
considerably lower than those paid for any regular form of male labour.
But there is another fact which adds to the significance of this.
Skilled labour among men is much more highly paid than unskilled labour.
Among women's industries this is not the case to any great extent.
Skilled work like that of book-folding is paid no higher than the almost
unskilled work of the jam or match girl. This is said to be due partly
to the fact that the lower kinds of work are done by girls and women who
are compelled to support themselves, while the higher class is done by
women partly kept by husband or father, partly to the pride taken in the
performance of more skilled work, and the reluctance to mingle with
women belonging to a lower stratum of society, which prevents the wages
of the various kinds of work from being determined by free economic
competition. A bookbinding girl would sooner take lower wages than
engage in an inferior class of work which happened to rise in the market
price of its labour. But whatever the causes may be, the fact cannot be
disputed that the lower rates of wages extend over a larger proportion
of women workers.

Again, the wages quoted above refer to workers in factories. But only
three women's trades of any importance are managed entirely in
factories, the cigar, confectionery, and match-making[34] trades. In
many of the other trades part of the work is done in factories, part is
let out to sweaters, or to women who work at their own homes. Many of
the clothing trades come under this class, as for example, the tie-
making, trimmings, corset-making trades. The employers in these trades
are able to play the out-doors workers against the indoors workers, so
as to keep down the wages of both to a minimum. The "corset" manufacture
is fairly representative of these trades. The following list gives the
per-centage of workers receiving various sums for "indoors" i.e.
"factory" work.

s. s. s. s. s. s. s. s. s. s.
Under 4 3--6 8--10 10--12 12--15 Over 15
2.94 p.c. 50 p.c. 2.94 p.c. 5.9 p.c. 14.7 p.c. 22.52 p.c.

Outdoor workers earn from 6s. to 12s., but where more than 10s. is
earned, the woman is generally assisted by one or more of her children.
Generally speaking, the most miserably paid work is that in trades where
most of the work is done by out-door workers. Such is the lowest stratum
of the "vest and trousers" trade, where English women undertake work
rejected by the lowest class of Jew workers, and the shirt-making trade,
which, in the opinion of the Lords' Committee, "does not appear to
afford subsistence to those who have no other employment." In these and
other trades of the lowest order, 6s. a week is a tolerably common wage
for a work-woman of fair skill to net after a hard week's work, and
there are many individual cases where the wage falls far below this

It is true that the work for which the lowest wages are paid is often
that of learners, or of inefficient work-women; but while this may be a
satisfactory "economic" explanation, it does not mitigate the terrible
significance of the fact that many women are dependent on such work as
their sole opportunity of earning an honest livelihood.

Sec. 3. Irregularity of Employment.--As the wages of women are lower than
those of men, so they suffer more from irregularity of employment. There
are two special reasons for this.

[Greek: a]. Many trades in which women are employed, depend largely upon
the element of Season. The confectionery trade, one of the most
important, employs twice as many hands in the busy season as in the
slack season. Match-makers have a slack season, in which many of them
sell flowers, or go "hopping." Laundry work is largely "season" work.
Fur-sewing is perhaps the worst example of the terrible effect of
irregular work taken with low wages. "For several months in the year the
fur-sewers have either no work, or earn about 3s. or 4s. a week, and
many of these work in overcrowded insanitary workshops in the season.
Fur-sewing is the worst paid industry in the East End, with absolutely
no exceptions."[35]

[Greek: b]. Fluctuations in fashion affect many women's trades; in
particular, the "ornamental" clothing trades, e.g. furs, feathers,
trimmings, etc.

Employers in these slack times prefer generally to keep on the better
hands (on lower wages), and to dismiss the inferior hands.

These "natural" fluctuations, added to ordinary trade irregularities,
favour the employment of "outdoor" workers in sweaters' dens or at home,
and require in these trades, as conducted at present, the existence of
an enormous margin of "casual" workers. These two chief factors in the
"sweating" problem, sub-contract and irregular home-work, are far more
prevalent in female industries than in male.

Sec. 4. Hours of Labour in Women's Trades.--The Factory Act is supposed to
protect women engaged in industrial work from excessive hours of labour,
by setting a limit of twelve hours to the working day, including an
interval of two hours for meals.

But passing over the fact that a dispensation is granted, enabling women
to be employed for fourteen hours during certain times, there is the far
more important consideration that most employments of women wholly
escape the operation of the Factory Act. In part this is due to the
difficulty of enforcing the Act in the case of sweating workshops, many
of which are unknown to inspectors, while others habitually break the
law and escape the penalty. Again, the Act does not and cannot be made
to apply to a large class of small domestic workshops. When the
dwelling-room is also the work-room, it is impossible to enforce by any
machinery of law, close limitation of hours of labour. Something may be
done to extend the arm of the law over small workshops; but the worst
form of out-work, that voluntarily undertaken by women in their own
homes, cannot be thus put down. Nothing short of a total prohibition of
outwork imposed on employers would be effectual here. Lastly, there are
many large employments not subject to the Factory Act, where the
economic power of the employer over weak employees is grossly abused.
One of the worst instances is that of the large laundries, where women
work enormously long hours during the season, and are often engaged for
fifteen or sixteen hours on Fridays and Saturdays. The whole class of
shop-assistants are worked excessive hours. Twelve and fourteen hours
are a common shop day, and frequently the figure rises to sixteen hours.
Restaurants and public-houses are perhaps the greatest offenders. The
case of shop-assistants is most aggravated, for these excessive hours of
labour are wholly waste time; a reduction of 25 or even of 50 per cent
in the shopping-day, reasonably adjusted to the requirements of classes
and localities, would cause no diminution in the quantity of sales
effected, nor would it cause any appreciable inconvenience to the
consuming public.

Sec. 5. Sanitary Conditions.--Seeing that a larger proportion of women
workers are occupied in the small workshops or in their own overcrowded
homes, it is obvious that the fourth count of the "sweating" charge,
that of unsanitary conditions of work, applies more cruelly to them than
to men. Their more sedentary occupations, and the longer hours they work
in many cases outside the operation of the Factory Act, makes the evils
of overcrowding, bad ventilation, bad drainage, etc., more detrimental
to the health of women than of men workers.

Sec. 6. Special Burdens incident on Women.--We have now applied the four
chief heads of the "sweating" disease--low wages, long hours, irregular
employment, unsanitary conditions--to women's work, and have seen that
the absolute pressure in each case is heavier on the weaker sex.

But in estimating the industrial condition of women, there are certain
other considerations which must not be left out of sight.

To many women-workers, the duties of maternity and the care of children,
which in a civilized human society ought to secure for them some
remission from the burden, of the industrial fight, are a positive
handicap in the struggle for a livelihood. When a married woman or a
widow is compelled to support herself and her family, the home ties
which preclude her from the acceptance of regular factory work, tell
fatally against her in the effort to earn a living. Married women, and
others with home duties which cannot be neglected, furnish an almost
illimitable field of casual or irregular labour. Not only is this
irregular work worse paid than regular factory work, but its existence
helps to keep up the pernicious system of "out-work" under which
"sweating" thrives. The commercial competition of to-day positively
trades upon the maternity of women-workers.

In estimating the quantity of work which falls to the lot of industrial
women-workers, we must not forget to add to the wage-work that domestic
work which few of them can wholly avoid, and which is represented by no
wages. Looking at the problem in a broad human light, it is difficult to
say which is the graver evil, the additional burden of the domestic
work, so far as it is done, or the habitual neglect of it, where it is
evaded. Here perhaps the former point of view is more pertinent. To the
long hours of the factory-worker, or the shopwoman, we must often add
the irksome duties which to a weary wife must make the return home a
pain rather than a pleasure. When the industrial work is carried on at
home the worries and interruptions of family life must always contribute
to the difficulty and intensity of the toil, and tell upon the nervous
system and the general health of the women-workers.

Other evils, incident on woman's industrial work, do not require
elaboration, though their cumulative effect is often very real. Many
women-workers, the locality of whose home depends on the work of their
husband or father, are obliged to travel every day long distances to and
from their work. The waste of time, the weariness, and sometimes the
expense of 'bus or train thus imposed on them, is in thousands of cases
a heavy tax upon their industrial life. Women working in factories, or
taking work home, suffer also many wrongs by reason of their "weaker
sex," and their general lack of trade organization. Unjust and arbitrary
fines are imposed by harsh employers so as to filch a portion of their
scanty earnings; their time is wasted by unnecessary delay in the giving
out of work, or its inspection when finished; the brutality and
insolence of male overseers is a common incident in their career. In a
score of different ways the weakness of women injures them as
competitors in the free fight for industrial work.

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

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

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

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

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

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

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

(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

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

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

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

"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

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

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

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

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

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

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