LIBRARY UNIVERSITY OF CALIFORKJIA IRVIN_ HT) ESSAY THE RATE OF WAGES: AN EXAMINATION or THX CAUSES OF THE DIFFERENCES IK THX CONDITION OF THE LABOURING POPULATION THROUGHOUT THE WORLD. " We cannot refrain from expressing an opinion that another and a greater matter than that between 'he utirocatrt and opponent* of poor-laws remain* behind namely, an examination of the necctttry which is supposed to entail pauperism on society." Athenctum, July 18, 1835. BY H. C. CAREY. PHILADELPHIA: CAREY, LEA & BLANCHARD, 1835, ERRATA. Page 141, line 18, for estate, read state. u 143, line 6, for estate, rtad state. " 161, line 22, for lands they possess are, read land they possess is. a 171, last line, for labourer, read labour. 185, line 28, for annum, read mensem. 44 244, line 9, for A'cole, read A eoti. ESSAY ON THE RATE OF WAGES, IN the discussion now and for a long time past carried on between the political economists and the practical men, or advocates of the mercantile theory, the former have generally confined themselves to indi- cating what would be the result of the adoption of their views, while the latter have pointed triumph- antly to experience, calling upon us to admire the prosperity that has been produced by their system, and to hesitate before abandoning one that has been the cause of such admirable results, and which has the additional recommendation of having been sanc- tioned by our forefathers. They call for facts, re- garding them as universally confirmatory of the truth of their doctrines, and look upon their opponents as theorists, reasoning in opposition to all experience, and willing to hazard the happiness and prosperity of nations in the endeavour to prove the correctness of visionary notions, that will not bear examination. Thus, in the inquiry now prosecuting by the French Minister of the Interior, M. Barbet, one of the wit- 6 ESSAY Off THE RATE OF WAGES. nesses summoned, says, "We are exceedingly sorry that the persons who, in their writings, have attack- ed the existing system, have not come before the council to defend their opinions here. If instead of a system founded on probabilities and surmises, they had opposed to us facts, we could have answered them." The object of the following essay is to furnish the facts, as called for by M. Barbet : not a few isolated facts, as has generally been done by the advocates of " things as they are," but " the truth and the whole truth," as far as it can be ascertained, in regard to the policy of some of the principal nations of the earth, and to its results, as seen in the rate of wages, or reivard of labour. As introductory thereto, it is proposed to examine what are the circumstances which tend to determine the rate of wages. Both of these subjects have been treated by Professor Se- nior in his lectures delivered before the University of Oxford,* and as he is among the latest and highest authorities, I propose, in order that the reader may compare our views, and judge between us, to give mine in the form of a review of the doctrines enun- ciated in those lectures. * Three Lectures on the Rate of Wages ; delivered before the University of Oxford Easter Term, 1830. By Nassau William Senior. Second edition : London: 1831. Lecture on the Cost of obtaining Money ; delivered before th University of Oxford, in Easter Term, 1839, by Nassau W. Senior. 1830. ESSAY ON THE RATE OF WAGES. CHAPTER I. " Most men, in all ages, have sat down to the Gos- pel with a set of prejudices, which, like so many in- quisitors, have laid the Christian religion on a bed like that of Procrustes : and as it suited them, either mutilated it by violence, or extended it by force." So said the learned and excellent Alexander Knox, in a letter to Bishop Jebb, and so may be said of most writers on Political Economy. Almost all ap- proach the subject with " a set of prejudices," and instead of patiently collecting facts, and constructing theories therefrom, the theory is first constructed the bed of Procrustes is made and then as many facts are taken as tend to support it, omitting all no- tice of those which have a contrary tendency. Had this not been the case, it would not, in our day, be in the power of a distinguished professor to characterize the doctrine of wages as " the most difficult, as well as the most important branch of political economy."* Adam Smith asserted that the rate of wages was regulated by the proportion which the supply of labour bore to the demand ; a theory which has been controverted by writers of our time, on the ground that in no case where an article can be freely pro- duced can any permanent influence upon price be * Lectures on Wages, p. 3. 8 ESSAY OH THB RATE OF WAGES. produced by excess of demand, and that any rise must cause increased production that will sink the price again to the cost. That this argument is gene- rally correct, there can be no doubt, but in order to make it fit man, it has been necessary to distort some facts, and overlook others, which are in direct oppo- sition to it. Had subsequent writers followed the author of the Wealth of Nations, confining themselves to an examination of the various disturbing causes, the work of man, that operate among the several nations of the earth to produce the inequalities that exist in the proportion between the supply and de- mand, the " difficulty" would have been obviated. There can be no difference of opinion as to the " importance" of this subject, and its peculiar im- portance at this time, when there is so strong a ten- dency to the transfer of the reins of government from the hands of the few to those of the many. With the single exception of the United States, the privilege of making laws has heretofore been con- fined to certain classes, who, blinded by false views of their own interest, have generally acted as if government had been established for their peculiar benefit, and hence have arisen corn laws and mo^o- polies of all kinds ; restrictions on importations and exportations ; wars, and their attendant, heavy tax- ation. It is not to be doubted, that many of those who promoted this system, have honestly believed that it was for the benefit of the nation over which they were placed ; and that, with better information, they would have adopted a widely different course. They might, and probably would, have discovered, ESSAY OH THE RATE OF WAGES. 9 that " laissez nous faire" the reply of the French merchants to Colbert, was sound and judicious; and that all that could be desired by any people of their government, was to let them alone, and confine its attention to the security of person and property; not allowing any man to " kick the shins ..-or' pick the pocket" of his neighbour with impunity. Had they done so, the governments of Europe would be deem- ed blessings, instead of curses, as is now too fre- quently the case. It remains to be seen, whether in those in which the people have attained a higher de- gree of influence than they ha ve heretofore possessed, they will do better than has been done for them in times past by their hereditary ] awgivers; and whether or not it will be so, depends upon a correct under- standing of their own interest- . If they can be made to see, that the course heretofore pursued has had a tendency to depress the rate of wages, and to keep the mass of the people in a stn*- of poverty, it may be hoped that there will be a disposition to make trial of a different one, and ascertain its effects. If it can be shown that restrictions and monopolies wars, and heavy taxation low wages, poverty, and wretched- ness go hand in hand ; while free trade freedom of action peace moderate taxation high wages, and abundance, are all associated, there can be little doubt which will be their choice. Heretofore, a large portion of the people of Great Britain have believed that a state of war was that in which the nation was most prosperous; and they have been content to barter the advantages of peace for the glories of Blenheim or Ramilies, Vittoria or A2 10 ESSAY Off THE RATE OF WAGES. Waterloo. Intoxicated with glory, and deafened by shouts of victory, and the roar of cannon celebrating their triumphs, they have squandered hundreds of millions seeking that prosperity which stood at their doors waiting the return of reason. Like the drunk- ard, feeling after every such debauch (he injurious effects of excitement, they have beert disposed to attribute those effects to the absence of stimulus, and not to the stimulus itself. Thus at each return of peace, the nation has found itself burthened with in- Creased debt, requiring increased taxes, tending to lessen the enjoyments of the people; but those incon- veniences have been attributed not to the war, but to the peace. The necessary consequence of this has been a proneness to embrace the first opportunity of recommencing hostilities, and causes the most insig- nificant the taking of Oczakow the seizure of the Falkland Islands or the denial of the right to cut logwood in the Bay of Honduras have been suffi- cient to set the nation in a flame. When, at length, the French Revolution occurred, it was gladly seized" upon as affording an opportunity to interfere in the affairs of the continent, in accordance with the sys- tem that has prevailed since the accession of the House of Orange, and the war then commenced was persevered in, until its close found the nation in a state of prostration, and the people by whom it was most desired, reduced to the alms-house. M Ships, colonies, and commerce," was the cry of Napoleon, echoed by the British ministry, and gladly re-echoed by the people, always accustomed to asso- ciate the idea of prosperity with that of extended do- ESSAY ON THE RATE OF WAGES. 11 minion. During the whole of the last century, this erroneous association led the nation to do that which each member of it would have deemed madness in an individual, became it was supposed that the rules which should govern the actions of individuals, could not be applied to those of nations. Had they seen a man wasting his means and incurring heavy debts in the prosecution of hazardous enterprises, the benefit of which was doubtful, even should they succeed to the full extent of his anticipations, while his farm was untilled, or his business neglected ; they would have said that he must become bankrupt, and his credit would have been destroyed. Yet the people who would argue thus in regard to an individual, ne- glected the means of prosperity within their grasp, seeking to increase their store at the expense of their neighbours ; and the addition of a new colony, al- though, like Gibraltar, Malta, or St. Helena, produc- tive only of cost, was deemed sufficient to entitle the minister to the gratitude of the nation. Every acqui- sition was accompanied by an increase of debt and consequent increase of taxation, tending to prevent the proper cultivation of the farm at home, until at length it was found necessary to apply the same sys- tem to this country, the attempt at which lost her these immense possessions, and added greatly to her embarrassments. Had she been content prior to the war of 1756 to cultivate her own resources, she would never have experienced the want which led to that attempt. It is true she might not have added Canada to her already extended dominion, but she might have retained these provinces, perhaps even J2 ESSAY Off THE RATE OF WAGES. to the present time , or, when they had become too strong to be longer held as colonies, the separation might, and probably would, have been a peaceable one, each party governing itself, but remaining one for all purposes of commerce. The battle of Plassy substituted dominion in the east for that which she lost in the west, but what has it added to her pros- perity ? Nothing ! It has enabled many men to bring home large fortunes, acquired at the cost of the cries, and groans, and curses, of the unfortunate Hindoos, plundered by order of a Clive or a Hast- ings ; but to the substantial comforts of the mass of the people, it has added nothing in any shape, while it has withdrawn from them immense sums for the support of an odious and oppressive monopoly. Sub- sequently, the wars of the French revolution made large additions to the possessions of the nation, on the one hand, and corresponding additions to its embarrassments, on the other : increasing the care and anxiety of the governors, and preventing that improvement in the condition of the governed that would otherwise have taken place. Had the laws which govern the rate of wages, and the effect of the various disturbing causes which pre- vent the action of those laws, been properly under- stood, wars could never have been popular. Mr. M'Culloch says, with great truth, that " the labour- ers are masters of their own fortunes, and that there is little reason to hope for any great improvement until they shall be made to understand correctly the laws which govern the rate of wages, and the fact that it rests with them to determine what that rate ESSAY ON THE RATE OF WAGES. 13 shall be." Had they understood them, they would have seen that a state of peace was that in which they must prosper most, and would have been indis- posed to join in a pursuit that might bring them " glory," but that would inevitably deprive them of a part of their bread and meat. Had they been un- derstood by those who are in " high places," and upon whom rested the cares of government, they would have seen that the prosperity and happiness of the people, in which would consist their own true glory, were not to be promoted by empty triumphs, nor by the addition of barren islands to their already extensive possessions. They would have seen that peace alone could do it, and had they done so, they might perhaps have retained the same intimate con- nexion with this country that once existed, with an intercourse unfettered by corn laws on the one side, or the system of minimums on the other; and the people of Great Britain, instead of groaning under the pressure of taxation, for the support of the govern- ment, the land owners, paupers, and monopolists, might now be the happiest and freest from taxation of any nation in the world. It is, indeed, impossible to imagine the height of prosperity which she might have attained, had she kept aloof from the intrigues and contentions of the Continent during the last cen- tury, as she might well have done; and had the thousands of millions expended in paying men for carrying muskets, been left in the hands of their own- ers to be applied as they might judge most likely to conduce to their comfort and advantage. Unfortu- nately, however, the triumphs of peace are little 14 ESSAY O1T THE RATE OF WAGES. valued, and Sir Robert Walpole, who could maintain a peace for twenty years, is little thought of when compared with the elder Pitt, whose first wish was for extended territory, and who is best known for carrying the nation triumphantly through a war; and the names of Alexander and of Caesar are familiar to thousands who never heard of Antoninus, or of Marcus Aurelius.* Had this subject been properly understood, we should long since have seen the end of protective tariffs; but as nothing can be more evident to the un- enlightened than the advantage to be derived from making their neighbours pay them high prices, so nothing is more easy than to excite popular feeling in favour of a system of protection; and the same man who would deem absurd such a system in his own family, would advocate its adoption by the large family, termed a nation; as if those principles of trade which were true with regard to ten or twenty per" sons, could be untrue when applied to twenty thou- sand or two hundred thousand. It is a disgrace to our age to see two such nations as those of Great Britain and France each hedging round its commerce by restrictions that limit their exchanges to a million or two of pounds per annum; thus doing all in their power to frustrate the beneficent designs of the Deity, who, in giving to different parts of the earth different powers of production, paved the way for that inter- * During the long peace maintained by Cardinal Fleury, France recovered a little; the insignificant administration of this weak minister proving that the ruler of a nation may achieve much good by abstaining from the communion of evil. Soy, p. ZZZT. ESSAY ON THE RATE OF WAGES. 15 course which is most beneficial to mankind. " Com- merce," says Mr. ftfCulloch, " is the grand engine by which the blessings of civilization are diffused, and the treasures of knowledge and of science con- veyed to the remotest corner of the habitable globe; while by making the inhabitants of each country de- pendent on the assistance of those of others, for a large share of their comforts and enjoyments, it forms a principle of union, and binds together the universal society of nations by the common and peaceful ties of mutual interest and reciprocal obligation." In another point of view, it is highly desirable that it should be understood. Wages and profits have been represented by many political economists as natural antagonists, the Ormuzd and Ahriman of political economy, one of which could rise only at the expense of the other. Such has been the be- lief of the great mass of the people who receive wages, which belief has given rise to trades' unions, so numerous in England, and obtaining in the United States; as well as to the cry of the poor against the rich. A large portion of those who pay, as well as those who receive wages, believe that the rate is alto- gether arbitrary, and that changes may be made at will. To this belief we are indebted for the nume- rous " strikes," or " turns out" we have seen, the only effect of which has been loss to both employers and workmen.* Had the journeymen tailors of Lon- * From a pamphlet recently published by Mr. Pratt, in relation to Savings Banks, it is found, " that the few counties which exhibit a falling off in the amount of their deposits are precisely those in which trades'- unions and turns-out have prevailed to the greatest ex- 16 ESSAY Olf THE RATE OF WAGES. don understood the laws by which the distribution of the proceeds between the workman and the capitalist is regulated, they would have saved themselves and their employers the enormous loss that has arisen out of their recent combination, and would have retained their situations instead of seeing themselves pushe^ from their stools by the influx of Germans, who seized gladly upon the places vacated by their English fel- low workmen. Believing, as they do, that their wages are depressed for the benefit of their employers, they believe also that those employers are bound to give them a portion of their profits in the advance of wages, when, in fact, the employers are also suffer- ers by the same causes which produce the depression, and are unable to advance 4hem, however willing they may be. If the real causes of the depression were understood, instead of combining against their employers, they would unite with them to free their country from those restrictions and interferences which produce the effect of which they complain, and would thus secure permanent advantage, instead of a temporary advance of wages, which is all that can be hoped for from combination, even if successful, which is rarely the case. Fortunately, in the United States there have been fewer interferences, and there tent Among parts of the country where unions appear to have flourished at the expense of the savings banks, we may enumerate Derbyshire and Durham, in the latter of which there has been a de- crease of 917 out of 3651 accounts. As might naturally be supposed, the waste of capital has occurred principally among the smaller and poor depositors; the diminution in the number of accounts under 50, being 719, and the decrease in /nuns below 100, amounting to 830 of the entire 917." ESSAY ON THE RATE OF WAGES. 17 is therefore less to alter, than in any other country; and if the workmen and labourers could be made to understand the subject, they would see that the divi- sion between themselves and the capitalist, or the rate of wages, is regulated by a law immutable as are those which govern the motion of the Heavenly bo- dies; that attempts at legislative interference can pro- duce only disadvantageous effects; and, that the only mode of increasing wages is by rendering labour more productive, which can only be accomplished by allow- ing every man to employ his capital and talent in the way which he deems most advantageous to himself. They would see that all attempts on the part of the capitalist, to reduce wages below the natural rate, as well as all on their part to raise it above that rate, must fail, as any such reduction must be attended with an unusual rate of profit to the employer, which must, in its turn, beget competition among the possessors of capital, and raise the rate of wages ; while such ele- vation in any employment must reduce the rate of profit so far as to drive capital therefrom, and reduce wages again to the proper standard. They should see in the fact that the great majority of the master workmen have risen by their own ex- ertions to the situations they at present occupy, abun- dant evidence that nothing is wanting to them but industry and economy. They should desire nothing but freedom of action for themselves, and that secu- rity both of person and property which prompts the capitalist to investment; and so far should they be from entertaining feelings of jealousy towards those who, by industry and economy, succeed in making B 18 ESS4T Off THE RATE 0V WAGES. themselves independent, that they should see with pleasure th<- increase of capital, certain that such in- crease must produce new demands for their labour, accompanied by increased comfort and enjoyment for them. With such a system the population of this country might increase still more rapidly than it has done; the influx of people from abroad might be triple or quadruple what it has been, and each successive year find the comforts of the labouring population in a regular course of increase, as the same causes which drive the labourers of Europe here, to seek that em- ployment and support denied them at home, impel the capitalist to seek here a market for his capital, at the higher rate of interest which our system enables us to pay him with profit to ourselves. The great influx of foreign labour at the present time has caus- ed some uneasiness, but without good reason. The capitalist should bear in mind that if the supply of labour did not keep pace with the growth of capital, the profits of the latter would be diminish- ed; and the labouring classes should recollect that if the labourers remained at home the capital would probably remain with them, and that, at all events, every man ivho, by his arrival in this country, increases the number of producers, and of competitors for em- ployment, also increases the number of consumers or employers. Such people consume nearly, if not quite, the whole amount of their wages, and are therefore employers to nearly the same extent that they are competitors. This remark applies with equal force to the opposite side of the Atlantic, from which vast ESSAY ON THE RATE OF WAGES. 19 numbers of consumers are sent off in the hope of lessening the number of producers. Had these laws been understood by the opposers of the tariff at the south, Mr. M'Duffie and his friends would not have asserted that " the tariff system had raised the price of labour, in the free states, to fifty cents per day, while it had forced it down in the planting states to twelve and a half cents per day." Had they endeavoured to prove to the people of the north, that all were equal sufferers by the system, they might have been listened to much more readily, al- though, by such an argument, they would not have produced so much effect upon the people of the south- ern states. It was, probably, this erroneous idea that produced the lamentably inconsistent course of the most active friends of free trade in promoting the passage of the gold bill, for the purpose of granting a bounty upon a southern product. It may be hoped that the result of this departure from principle will prevent any such conduct in future. The friends of free trade should never forget the admirable advice of Burke: " We ought to be bottomed enough in prin- ple, not to be carried away upon the first prospect of any sinister advantage. For depend upon it, that if we once give way to a sinister dealing, we shall teach others the same, and we shall be overcome and overborne." In opposition to the doctrine of Adam Smith, that " demand and supply govern the rate of labour, and that where capital increased most rapidly the in- creased demand for labour would lower the rate of profits, by which the labourer would be benefited,'* 20 ESSAY Off THE RATE OF WAGEfc. Mr. M'Culloch says, that no competition among ca- pitalists can lessen the rate of profit, except tempora- rily, because, the rate of wages can never exceed the necessary rate, [or, according to M. Say, " the limit of strict necessity"] which is that which will enable the labourer to purchase food and clothing; and that if they should chance at any time to exceed it, there would be an increase of population sufficient to re- duce them again. He says, " the cost of production will always regulate price, and if price go beyond cost, the production will be increased." At the same time he tells us that the food and clothing of a la- bourer are now vastly greater than they were three centuries since; that is, that the cost of a labourer is now greater than it was. We know that there has been a steady increase in the comforts of the labour- ing classes for centuries ; that it is still going on, and that their increased price has not increased production sufficiently to check the advance, nor does it appear likely so to do. In every tolerably well governed state there has been a steady increase of price and augmentation of comfort, causing increased produc- tion, and yet that increase of production is attended with an equally steady improvement of condition. Following out the doctrine that the labourer re- ceives only necessary wages, and that, in the event of any circumstance causing a fall below that rate, there will be a reduction in the supply of labour, which will cause wages to advance, Mr. M'Culloch asserts, that all taxes on wages, or upon articles used by the labourer, must be paid out of profits, and that as wages must rise with any increase of taxation) ESSAY Off THE RATE OF WAGES. 21 profits must fall. If this be correct, it is of little im- portance to the labourer what is the extent of taxa- tion. Receiving only necessary wages, i. e. sufficient to support life, they cannot be reduced; and all taxes being paid by his employer, what interest can he have in the good government of the nation? The experience of England has shown, however, that such taxation is not accompanied by a fall of profits, as within the last century, in which taxation has been so much increased, the rate of interest has advanced, and is now considerably higher than it was in the early part of the 18th century. During the reign of George I., interest frequently did not exceed 3 per cent. In 1731-2, the bank furnished money to the govern- ment at 3 per cent. In June 1739, the 3 per cents, were as high as 107. In 1743, a period of war, they were at 97. In 1744, a loan was contracted at 4J. After the close of the war in 1749, the interest on the public debt was reduced to 3 per cent, after 1757, with a condition, that the creditors should receive 4 per cent, for cne year, and 31 per cent, thereafter until 1757. In 1757, after the nation had been two years engaged in an expensive war, the rate was very little more than 3 per cent. Since 1815, the 3 per cents, have fluctuated from 56| to 93| per cent. From a statement furnished to Parliament by the Bank of England, of the half yearly prices of stocks, it appears that from August 1815 to February 1832, a period of 17 years, the prices were Once between 50 and 60 per cent 5 times " 60 and 70 per cent. 12 times " 70 and 80 per cent* B2 22 ESSAY ON THE RATE OF WAGES. 1 1 times between 80 and 90 per cent 5 times " 90 and 93 J. per cent. From August 1825 to February 1832, the highest price was 91 J, and the lowest 76, and the average of the fourteen half yearly returns 86. In France, prior to the war of 1756, East India stock command- ed so high a price as to yield little over 4 per cent, interest In Hindostan, where taxation is high, it produces no increase of wages, while the modera- tion of it, in the United States, does not depress them. Mr. M'Culloch says, that the great object of go- vernment should be to secure to its people high pro- fits, which would enable them to increase their capital most rapidly; but according to his doctrine, and that of M. Say, who styles them " conflicting interests," high profits must be accompanied by low wages. It is difficult to determine precisely what is meant, when he speaks of wages, and what by pro- fits, and, after a careful perusal of what he has written upon this subject, I am uncertain whether he con- siders the man who cultivates a dozen acres of flax as receiving profits, or if he would confine that term to the capitalist who makes it into linen. The great mass of the agriculturists of this country are small capitalists, as are those of France, Italy, and Germany, paying rent, and finding their own implements. The ^hocmaker, the tailor, the engraver, and the enj^ir.'^r. have a capital in that quantity of previous labour, which enables them to obtain higher wages than a common labourer. There are daily examples of the fact, that skill in any department of business is deemed equivalent to capital, in the part- ESSAY OH THE RATE OF WAGES- 23 nerships that are formed, where one party furnishes the moneyed capital, and the other the ski'! to manage it A large portion of the classes mentioned obtain, in their double capacity of labourer and capitalist, moderate wages, as I would term their compensation; but I do not know whether Mr. M'Culloch would consider them as living on wages or profits. The moneyed capitalist of India receives enormous profits, while the smaller capitalist, who cultivates a few acres, has barely sufficient to support a miserable existence. There, capital does not increase. In England, Holland, and the United States, capital is furnished at a much lower rate of interest, by the large capitalists, but the smaller one, such as we have mentioned above, who, perhaps earns only tolerable wages, is much better paid, and there capital does increase, as is evidenced by a rapid increase of po- pulation, accompanied by improved means of living. It would be necessary, in order to make the theory of Mr. M'Culloch correct, to consider all those great classes of which we have spoken, capitalists, living by profits ; but, if so, the class living by wages is a comparatively small one. I should be disposed to consider them as living by wages, and to say that, where wages are highest, there capital increases most rapidly. The most rapid increase of capital is in the United States and Great Britain, where wages are highest. This is entirely in opposition to the doctrines of Messrs. Say, Malthus, Ricardo, and M'Culloch, as, if wages did not exceed " the limit of strict ne- cessity," there could be no accumulation from that source, and as, according to them, where wages are 24 ESSAY Off THE RATE OP WAGES. high profits must be low, there could be little expec- tation from them. Mr. M'Culloch asserts, that real wages, (by which he means proportional wages,) have fallen in Great Britain within the last fifty years, while the tables in his own Commercial Dictionary show that real wages, or the quantity and quality of commodities attainable by the labourer, have steadily increased. That increase has been small in food, because of the corn laws, but it has been very great in almost all other articles of consumption.* No better evidence need be desired of the improvement that has taken place in the situation of the labouring classes gene- rally, than the fact that the Savings Banks of Eng- land have a capital exceeding fifteen millions,! an d those of France,* instituted more recently, a capital * The Edinburgh Review, Vol. 56, in a Review of Dr. Chalmers's Political Economy, furnishes extracts from various works on the situation of Scotland, about the middle of the last century, showing that the people were in the lowest state of wretchedness, and "often felt what it was to want food." Now they are universally well fed and well clothed, their cottages are comfortable ; and they are all in the enjoyment of luxuries that formerly were never tasted, even by lich proprietors. t Upwards of 20,000 of the depositors were agricultural labourers, who, there is reason to believe, were generally heads of families. Report Poor Law Commissioners, p. 229. t " M. Peurhet, the ablest of French statistical writers, says, Us ae mangent aujourd'hui plus de pain, plus de viande en France qu'autrefois. L'hommc des campagncs qui ne connoissoit qu'une nourriture grossiere, une boisson pcu saine, a aujourd'hui de la viande, du pain, du ble, du vin, du bon cidrc, ou de la biere. Lea denrees coloniales sc sont repandues aussi dans les campagnes de- puis I'augmentation de la richcsse des cultivatcurs.' If we turn to ESSAT ON THE RATE OF WAGES. 25 of four millions, of pounds sterling, the accumulation of those classes. It is a very general impression, that the condition of the labouring classes of Eng- land had deteriorated since the close of the war, but the Agricultural Committee of the House of Com- mons, of which Mr. Jacob was chairman, state in their report of August 2d, 1833, that, " It appears, that in all parts of the country in the most distressed as well as the most prosperous the condition of the labourer is in no instance worse than it was five or ten years ago, and that in most cases their condition is greatly improved. The wages of labourers, the witnesses state, have not been reduced in proportion to the reduction in the price of the necessaries of life, and in many parts of the country no reduction, whatever has taken place in their money wages since the war. This state of things is the more extraordi- nary, as the superabundance of labour is represented to be greater than ever, and the number who are out of employ, and who are provided for by the poor's rate, is very considerably increased." The improve- ment in the situation of the people of England would be immense, had she not wasted her energies in the prosecution of wars of the most expensive and ruin- ous character, the natural consequence of which has been,enormous taxation, which absorbs a large por- tion of her increased production. Her corn laws, Russia, Prussia, and Germany, the change for the better is even more striking than in France ; and while the numbers of the people are increasing, their comforts and enjoyments are increasing stifl more rapidly." d. Rev, Vol. 56, p. 65, 26 ESSAY ON THE RATE OP WAGES. too, the object of which is to raise the price of that most important article of consumption, prevent the improvement that might, even under the pressure df her great taxation, take place. In the United States, where taxation is small, and trade comparatively free, a much more fair comparison may be made, and it is the only country in whi<;h it. can be done with any tiling like an approach to correctness. The reward of the labourer is vastly greater at this time, when there are fifteen millions of peoplp, than ft was forty years since, when there were Only four millions; and although the increased pri^e has produced ia* creased production, as well as large- Importations of labour, there has been a constant augmentation oT the means of living. Agricultural labour has not varied materially in these forty yeajs in its money price, but the variation that has taken, place has been in its favour, the wages of jnen having been very steadily about nine dollars per month and their board, but higher wages are now not very unusual. The wages of house servants and of female* have greatly advanced, being nearly double what thfcy were forty years since. The expenditure of all these- classes being confined almost altogether to the purchase of clothing, in which there has been a prodigious reduction o( price, it follows that the increase of comforts tvithin their reach must have been very great. From the year 1783 to 1790, the wages of carpenters and brick- layers were from 624 to 75 6ents per day: at pretent the wages of carpenters are from fl 'l2i to $1 2S> And of bricklayers from $ 1 37 to $ 1 50 per day. During thct time the price of wheat has experienced ESSAY ON THE RATE OP WAGES. 27 great variations, but the average of ten years from 1784 to 1793 inclusive, and 1824 to 1833 also inclu- sive, both periods of peace, is rather lower in the latter period than in the former. The following list of prices is made on an average of January, July, and December of each year. 1784, 1785, 1786, 1787, 1788, 1789, 1790, 1791, 1792, 1793, 1824, 1825, 1826, 1827, 1828, 1829, 1830, 1831, 1832, 1833. From this it will be seen that the quantity of wheat that can be obtained by the mason and carpenter is now double what could be obtained fifty years since. In manufactured articles, the increase is vastly greater. A change to the same extent would have taken place in England, but for restrictions and heavy taxation ; yet Mr. M*Culloch insists, not only that wages have fallen, but that they must fall. Mr. Senior $6 26") 5 82 5 56 5 56 4 89 5 07 5 91 general ^-average, $5 57 5 42 4 97 6 26^ 5 00^ 4 84 4 92 5 17 5 67 6 25 4 91 general >-average, $5 32 5 41 5 67 5 34, 28 ESSAY ON THE RATE OF WAGES. says, very justly, in regard to this theory, " Since the publication of Mr. Ricardo's work, it has been re- ceived as an axiom among the dabblers in Political Economy, that according to the established doctrines of the science, high wages and high profits are incom- patible, and therefore that either the leading doctrines of political economy are false, or the interest of the labourer and capitalist are directly opposed to each other. The former opinion has been embraced by the large class, who do not attend to what they read, and the latter by the still larger class, who do not attend to what they see."* * Lectures on Wages, p. 4. ESSAY ON THE RATE OF WAGES. 29 CHAPTER IL THE proposition with which Mr. Senior com- mences his Lectures on Wages, and which it is the object of them to establish, is one that is entitled to unqualified assent It is that " the rate of wages (i. e. the quantity and quality of commodities obtainable by the labourer and his family) depends on the extent of the fund for the maintenance of labourers, com- pared with the number of labourers to be maintained." Of this proposition, he says> " it is so nearly self-evi- dent, that it may appear scarcely to deserve a formal statement, still less to be dwelt on as if it were a dis- covery. It is true that it is obvious and trite, but per- haps on that very account its obvious consequences have been neglected." Self-evident as it appears, it may not be amiss to pause for a moment to illustrate it. It will be evident, that if any given community now producing 100,000 bushels of wheat, shall increase the quantity to 120,000, without an increase of number, the quantity for each, an equal division being made, will be in- creased one-fifth. It will be equally evident, that if at the end of a certain period, they shall, by any im- provement hi cultivation, have doubled their product, while their numbers have only increased fifty per cent, the share of each will be increased one-third As, however, the arrangements which take place 30 ESSAY ON THE RATE OF WAGES. in society are often of a much more complicated character, and render it necessary to make a division between the farmer who owns, and the labourer who tills the soil, it will be proper to examine how that is regulated, and what determines the extent of the fund for the support of the labourer. In a prosperous community like that above mentioned, there is a con- stant increase of capital, and as every owner desires to receive compensation for the use of his portion, each will seek some mode of employing it. One will purchase new lands, while another will turn his atten- tion to the further improvement of those he already possesses, and both will require additional labour, the former desiring to rent his lands to some one who will pay him rent, and the latter wishing to pay wages to some one to work for him. Both parties will be in the labour market as competitors for the new popu- lation, who will have thus the opportunity of becoming either farmers or labourers, and unless those who want them in the latter capacity will give a fair share of the proceeds of their labour, they will prefer the former. Such is exactly the case in the United States, and it is as much so in the mechanic arts as in agri- culture. If capital increased much more rapidly than po- pulation, labour would rise, and the share of the ca- pitalist would fall. If it fell below the rate obtainable elsewhere, so much would be sent abroad as would bring it again to a level. If no such means could be found of investing it, the share of the capitalist would continue to fall until some means should be found to supply the place of the labourer, or of rendering his ESSAT OV THE RATE OF WAGES. 31 labour more productive. Such we have seen to be the case in England, where interest had fallen in the early part of the last century, considerably below its present rate, and might still have remained so, had not the spinning-jenny and the steam engine substituted capital for labour, and by increasing the produce of labour, had the same effect as multiplying the labourers. Since those changes capital has in- creased most rapidly, but with it there have been new improvements of a similar kind, as the power loom, the steam-vessel, the rail-road, and the locomotive engine, by which it has been made productive, in- creasing the demand for, and consequent price of, capital, and at the same time reducing the cost of all articles of consumption to the labourer, by which the same effect has been produced as if his money wages had been increased, and the prices of commodities had remained stationary. Had these improvements not taken place, the rate of interest would now be low, but although the proportion of product assigned to the labourer would be greater, the amount would be by no means so great, on account of the unpro- ductiveness of capital. It has been already shown that although the money price of agricultural labour has not changed materially in this country within forty years, the share of the labourer of all the ar- ticles of consumption has greatly increased, and the general fund of commodities assigned for the support of the whole body of labourers must have increased in the same ratio, all of which has arisen out of the fact that with the aid of capital human labour has been rendered so very productive. 32 ESSAY Off THE RATE OF WAGES. The more advantageously the capital and labour of a country are applied, the greater must be the amount of production, and the more rapid must be the increase of capital. If it advance more rapidly than population, the demand for labour will always be such as to secure to the labourer nearly as large a share of the proceeds of it as if he worked on his own account; because, if he could obtain more by doing so, he would not fail to embrace the first opportunity. The division of produce is therefore regulated by the supply of labour in the market; and the quantity and quality of commodities assigned to the use of the whole body of labourers, will depend upon the relation which exists between the demand and the supply. Mr. Senior cautions his readers that there are vari- ous " popular errors** with which he deems this doc- trine to be inconsistent, and which are " Firtt. Itis inconsistent with the doctrine, that the rate of wages depends on -the proportion which the number of labourers bears to the amount of capital in a country. The word capital has been used in so many senses, that it is difficult to state this doctrine pre- cisely; but I know of no definition of that term which will not in. elude many things that are not used by the labouring classes; and if my proposition be correct, no increase or diminution of these things can directly affect wages. If a foreign merchant were to come to settle in this country, and bring with him a cargo of raw and manu- factured silk, lace, and diamonds, that cargo would increase the capital of the country; silks, lace, and diamonds, would become more abundant, and the enjoyments of those who use them would be in- creased; but the enjoyments. of the labourers would not be directly increased : indirectly, and consequentially, they might be increased* The silk might be re-exported in a manufactured state* and comma* ESSAY ON THE RATE OP WAGES. 33 ditics for the use of labourers imported in return; and then, and not till then, wages would rise; but that rise would be occasioned, not by the first addition to the capital of the country, which was made in the form of silk, but by the substituted addition made in the form of commodities used by the labourer." In another place the investment in diamonds is given as a reason why wages are not in the propor- tion of revenue to population. Such doctrines, as well as that advanced in regard to absenteeism, which will be considered hereafter, and that of M. Say in regard to capital employed in foreign trade, have a tendency to give a character of empiricism to the science, and it is to be regretted that teachers whose doctrines are so generally correct, should sanc- tion with their names others so erroneous. If a land-holder employ a hundred labourers in pro- ducing corn, and ten in working a diamond mine, of what importance is it to the labourer whether his em- ployer retain his profit in diamonds or corn? Or if the whole be employed in producing corn, and he ex- port part of the produce, and receive diamonds in exchange, how can it affect the wages of the labour- er? Suppose, instead of giving his corn for diamonds, he were to give it in exchange for a library, would the situation of the labourer be benefited? Or, sup- pose he employed only one hundred of them in agri- culture, and ten in building himself a new house, would they benefit by this mode of investment? The extent of the fund assigned to the whole body of la- bourers, must depend upon the amount of production, and the proportion which exists between the supply of labour, and the demand for it, and it is totally un- important to them whether that production be in the c2 34 ESSAY ON THE RATE OF WAGES* form of corn and potatoes, or diamonds and gold, and whether the landlord retain his share in the first or the last It is entirely unimportant whether he re- tain his diamonds, or invest the proceeds of them in enlarging his house. In the former case he would gratify his love of display, while in the latter his sole object might be to increase the comfort of his family. In all nations, and in all stages of society, a portion of revenue will be applied to the increase of conveni- ence or ornament The Indian and the slave have as much love of display as is found in Grosvenor Square* or the Chaussee (TJlntin. The cottager will give a portion of his time or his money towards or- namenting or extending his cottage, or, grown richer, will replace it by a new house, of brick or stone ; the mechanic will purchase carpets and mirrors; the mer- chant his carriage, and his lady her diamonds; every man will have his watoh, and those who have been accustomed to have them of silver, will replace them by others of gold, and in all these cases the object may be the same ; yet Mr. Senior would hardly be disposed to say that the price of labour was not in proportion to capital, because a part of the increase was ap- propriated to replacing wooden houses by others of brick or stonft! There is no objection arising out of the investment of a portion of the capital or revenue of a nation in diamonds, that does not lie equally against its employ- ment in the construction of houses of four stories, where those of two would as well answer the purpose of their occupants, or against the formation of libra- ries or museums, or the use of mahogany for furniture ESSAY OR THE RATE OF WAGES. 35 to place of cedar or pine; or, jn fact, against evqry species of expenditure above that of the log-house, and the blanket necessary for preservation against the in- clemency of winter. The chief, if not the only* cause of error that would exist in estimating wages to be in the ratio of capital .to population, is that which arises out of government- al interferences; and if two countries equally free from them, but differing in capital, could be found, wages would be found to differ in the same ratio. In England, the nominal rate of wages, when the la- bourer subsists himself, does not differ very material- ly from that of the United States; but after the divi- sion between him and the capitalist has taken place, a large amount is withdrawn for me service of the state, another for the support of the land owner, a third for that of the East India Company, and a fourth for that of the West India planters in their competi- tion with the growers of sugar in the East Indies, all of which tend greatly to red\ic the quantity of com- modities that falls to his share, and it follows that the general fund for the support of the labourer* is very much reduced. In the United States, where the ratio of capital, land included, to population, is, perhaps, smaller than in England, th " fund" is much larger; because, after the division has taken place, a compa- ratively small portion is claimed for state and other purposes, and the labourer has of course, a larger sum to invest in the purchase of commodities. ESSAY Off THE RATE OF WAGES. CHAPTER III. THE second error to which Mr. Senior deems his doctrine to be opposed, is, " that wages depend on the proportion borne by the number of labourers to the revenue of the society of which they are mem- bert:" his reasoning in regard to which is as follows: " Secondly. It is inconsistent with the doctrine, that wages de- pend on the proportion borne by the number of labourers to the re- Venue of the. society of which they are members. In the example last suggested of the introduction of u new supply of laces or dia- monds, the revenues of those who use lace or diamonds woidd be in- creased; but as wages are not spent on those articles, they would remain unaltered. It is possible, indeed, to state cases in which the revenue of a large portion of a community might be increased, and yet the wages of the labourers might fall, without an increase of their numbers. I will suppose the principal trade of Ireland to be the raising produce for thA English market; and that for every two hun- dred acre% ten families were employed in raising, on half tfce land, their own subsistence, and on the remainder corn and other export- able crops requiring equal labour. Under such circumstances, if a demand should arise in the English market for Cattle, butchere'- meat, and wool, instead of corn, it would be the interest of the Irish landlords and farmers, to convert their estates from arable into pas- ture. Instead often families for every two hundred acres, two might be sufficient: one to raise the subsistence of the two, and the other to tend the cattle and sheep. The revenue of the landlords and the farmers would be increased, but a large portion of the labourers would be thrown out of employment; a large portion of the laud formerly employed in producing commodities for their use would be devoted to the production of commodities for the use of England; and the fund for the maintenance of Irish labour would fall, notwith- standing the increase of the revenue of the landlords and farmers." ESSAY Off THE RATE OP WAGES. 87 Having already, (p. 33,) considered the objection arising out of the investment of a portion of the reve- nue of a nation in diamonds, I shall here notice oidy the case of the Irish labourers, which is entirely in opposition to his own views, expressed in relation to machinery. He sa^s no improvement in that can de- press the general rate of wages, and as the land is only a machine,- it follows, that if the owner can find a mode cf using it, that will render it doubly produc- tive, he is in the same situation with a man who doubles or trebles the product of labour by an im- provement in the power-loom, or any other machine. By the saving which he makes in this case, he is en- abled to increase his capital, and afford an equal, if not an increased, amount of employment, although not perhaps to the very same persons whom this im- provement deprives of wages. What the labourer has to complain of, is the want of capital. If capital in land were abundant, he would transfer his labour to some other part of Ireland, or if he had a little money- ed capital, the result of his savings, he might transfer himself to Canada ; but as land cannot be had in one place, and he has not what would enable him to seek it in another, he is deprived of employment In the United States no injurious effect would be produced by a determination of the whole people of Pennsylva- nia to abstain from tillage, and devote themselves to grazing, as the labourer would speedily remove to Ohio, Indiana, or Missouri. Great Britain possesses abundant capital in land, but her people are too much impoverished by taxa- tion to be able to seek it, and when they are not so, 38 ESSAY Off THE RATE OF WAGES. they know that they cannot be permitted to exchange their corn for hardware or cotton goods, except on payment of a heavy duty in addition to freight and other expenses, because the land owners do not deem it for their interest to permit such exchange. The following remarks by Mr. Senior, in relation to ma- chinery, will be found to apply with equal force to the case he has above supposed: " Nature lias decreed that the road to good shall be through evil that no improvement shall take place in which the general advan- tage shall not be accompanied by partial suffering. The obvious remedy is to remove those whftse labour has ceased to be profitable, to a country that will afford room for their exertions. Few inven- tions, during the present century, have conferred greater benefits on the labouring classes than that of the power-loom. By diminishing the expense of clothing, it has been a source, not merely of comfort, but of health and longevity. But its proximate effect was to spread ruin among the hand- weavers; to reduce almost all of them to a mere subsistence, and many to the most abject want. Ever since its Introduction, thousands have been pining away under misery, not alleviated even by hope; 'with no rational expectation, but that the ensuing year would be more calamitous than the passing one: and this without fault, and even without improvidence." The true causes why wages are not in the propor- tion of revenue to population, are, first, differences in the ratio of capital to population; second, in the extent of taxation for the support of government and for other purposes; and, third, in the mode of assess- ing the contributions for those purposes. In a country in which the ratio of capital to po- pulation is large, the demand for labour ensures to the workman a full share of the produce of his la- bour, as is the case in the United States, but in one in which it is small, there is little demand for labour, and ESSAY Off THE RATE OF WAGES. 3ft the competition fbr the use of landed or other capital being great, its price is enhanced, and the capitalist is enabled to obtain an undue proportion of the pro- duce, as in Ireland*. In two countries alike in the proportions which capital and revenue bore to population, which could not be the case, unless there was also equalitjrin the security of person and property, as well as of freedom of trade and of action, there would be an equdlity of wages,* unless prevented by difference in the govern- ment expenditure. The revenue at any given time being equal, if one should from that time forward expend ten millions, and the other one hundred mil- lions, the portion which the labourers would be ob- liged to contribute would form a deduction from t^e quantity *>f 'commodities obtainable by them, and render wages unequal. If one nation remained at peace with an army of six thousand men, artdyjhe other went to war, and employed half a million of men in carrying muskets, the production or revenue would be lessened, and the share of each than re- duced. During the whole time that this state of things continued, there would be a constantly increasing difference in the ratio of capital to population in the two nations* with a constantly increasing difference of wages, and at the expiration of half a century it would be difficult to imagine that there had been at any time an equality of condition between them. Unproductive expenditure of any kjri3y has the same effect; but that of government usually so far exceeds thafef all others as to attract exclusive con- 40 ESSAY OH THE RATE OP WAGES. sideration. If economy in government be advan- tageous, that of individuals is also in a very high degree promotive of the increase of capital, and of the improvement of the condition of the labouring classes. If in one country the labourers expend their surplus in gin, and the land-holders in the support of a numerous train of servants, while in another, the one class is prudent and sober, and the other moderate in expenditure, the difference will soon be perceived in the greater rapidity with which capital will grow, and with it the competition in the market of labour. The third cause of difference mentioned above, is th6 mode of assessing contributions for the support of government and for other purposes. While taxes are chiefly on consumption, governments will se- lect such objects as are extensively consumed, and will afford large revenue. An examination of the revenue systems of the different countries of Europe and America, will show that the chief part of the revenue is collected upon articles chiefly used by the labouring classes, while those which are used ex- clusively by the wealthy are almost untaxed, on account of the small amount they would yield, and the greater liability to fraud in the importation of the finer articles. All taxes and impositions of whatsoever kind being paid by the consumer, it follows that the labouring classes bear an undue proportion of the public burthen. Such is the case under all govern- ments, but less so in the United States than in Eng- land, and less in the Netherlands than in France. ESSAY Off THE RATE OF WAGES. 41 CHAPTER IV. THE third error to which Mr. S. adverts, is, " that the non-residence of landlords, funded proprietors, mortgagees, and other unproductive consumers, can be detrimental to a country that does not export raw produce" He admits its disadvantage in relation to a country like Ireland, which exports corn, but denies the injurious effect upon England, because she ex- ports only manufactures. This distinction being ori- ginal, his views are given in his own words: " Thirdly. It is inconsistent with the prevalent opinion, that the non-residence of landlords, funded proprietors, mortgagees, and other unproductive consumers, can be detrimental to the labouring inhabitants of a country that does not export raw produce. " In a country which exports raw produce, wages may be low- ered by such non^residence. If an Irish landlord resides on his estate, he requires the services of certain persons, who must also be resident there, to minister to his daily wants. He must have servants, gardeners, and perhaps gamekeepers. If he build a house, he must employ resident masons and carpenters; part of his fur- niture he may import, but the greater part of it must be made in his neighbourhood; a portion of his land, or what comes to the same thing, a portion of hi> rent, must be employed in producing food, clothing, and shelter for all these persons, and for those who pro- duce that food, clothing, and shelter. If he were to remove to England, all these wants would be supplied by Englishmen. The land and capital which was formerly employed in providing the maintenance of Irish labourers, would be employed in producing 1 corn and cattle to be exported to England to provide the subsistence of English labourers. The whole quantity of commodities appro- priated to the use of Irish labourers would be diminished, and that D 42 ESSAY OJT THE RATE OP WAGES. appropriated to the use of English labourers increased, and wages would, consequently, rise in England, and fall in Ireland. " It is true that these effects would not be co-extensive with the landlord's income. While, in Ireland, he must have consumed many foreign commodities. He must have purchased tea, wine, and sugar, and other things which the climate and the manufac- turers of Ireland do not afford, and he must have paid for them by sending corn and cattle to England. It is true, also, that while in Ireland he probably employed a portion of his land and of his rents for other purposes, from which the labouring population received no "benefit, as a deer park, or a pleasure garden, or in the maintenance of horses or hounds. On his removal, that portion of his land which was a park would be employed partly in producing exportable commodities, and partly in producing subsistence for its cultivators; and that portion which fed horses for his use might be employed in feeding horses for exportation. The first of these alternatives would do good; the second could do no harm. Nor must we forget that, through the cheapness of conveyance between England and Ireland, a portion, or perhaps all, of those whom he employed in Ireland, might follow him to England, and, in that case, wages in neither country would be affected. The fund for the maintenance of la- bourers in Ireland, and the number of labourers to be maintained, would both be equally diminished, and the fund for the maintenance of labourers in England, and the number of labourers to be main- tained, would both be equally increased. " But after making all these deductions, and they are very great, from the supposed effect of the absenteeism of the Irish proprietors on the labouring classes in Ireland, I cannot agree with Mr. M'Cul* loch that it is immaterial. I cannot but join in the general opinion that their return, though it would not affect the prosperity of the British empire, considered as a whole, would be immediately bene- ficial to Ireland, though perhaps too much importance is attached to it " In Mr. M'Culloch's celebrated examination before the committee on the State of Ireland, (Fourth Report, 814, Sess. 1825,) he was asked, ' Supposing the largest export of Ireland were in live cattle, and that a considerable portion of rent had been remitted in that manner, does not such a mode of producing the means of paying rent contribute less to the improvement of the poor than any extcn- ESSAY OIT THE RATE OF WAGES. 48 sive employment of them in labour would produce?' He replies. * Unless the means of paying rent are changed when the landlord goes home, his residence can have no effect whatever.' " ' Would not,' he is asked, ' the population of the country be benefited by the expenditure among them of a certain portion of the rent which (if he had been absent) has (would have) been re- mitted (to England) ?' ' No,' he replies, ' I do not see how it could be benefited in the least If you have a certain value laid out against Irish commodities ia the one case, you will have a certain value laid out against them in the other. The cattle are either ex- ported to England, or they stay at home. If they are exported, the landlord will obtain an equivalent for them in English commodities; if they are not, he will obtain an equivalent for them in Irish om- modities ; so that in both cases the landlord lives on the cattle, or on the value of the cattle : and whether he lives in Ireland or in Eng- land, there is obviously just the very same amount of commodities for the people of Ireland to subsist upon.' " This reasoning assumes that the landlord, while resident in Ireland, himself personally devours all the cattle produced on his estates; for on no other supposition can there be the very game amount of commodities for the people of Ireland to subsist upon, whether their cattle are retained iu Ireland or exported. " But when a country does not export raw produce, the conse- quences of absenteeism are very different. Those who derive their incomes from such a country cannot possibly epend them abroad until they have previously spent them at home. " When a Leicestershire landlord is resident on his estate, he employs a certain portion of his land, or, what ifc the same, of his rent, in maintaining the persons who provide for him those commo- dities and services, which must be produced on the spot where they are consumed. If he should remove to London, he would want the services of Londoners, and the produce of land and capital which previously maintained labourers resident in Leicester, would be sent away to maintain labourers resident in London. The labourers would probably follow, and wages in Leicestershire and London would then be unaltered ; but until they did so, wages would rise in the one district, and fall in the other. At the same time, as the rise and fall would compensate one another, as the fund for the maintenance of labour, and the number of labourers to be main- 44 ESSAY ON THE RATE OF WAGES. tained, would each remain the same, the same amount of wages would be distributed among the same number of persons, though not precisely in the same proportion *s before. " If he were now to remove to Paris, a new distribution must take place. As the price of raw produce is lower in France than in England, and the difference in habits and language between the two countries prevents the transfer of labourers from the one to the other, neither the labourers nor the produce of his estates could follow him. He must employ French labourers, and he must convert his share of the produce of his estates, or, what is the same thing, his rent, into some exportable form in order to receive it abroad. It may be sup- posed that he would receive his rent in money. Even if he were to do BO, the English labourers would not be injured, for as they do not eat or drink money, provided the same amount of commodities re- mained for their use, they would be unaffected by the export of money. But it is impossible that he could receive his rent in mo- ney, unless he choose to suffer a gratuitous loss. The rate of ex- change between London and Paris is generally rather in favour of London, and scarcely ever so deviates from par between any two countries as to cover the expense of transferring the precious metals from the one to the other, excepting between the countries which do, and those which do not possess mines. The remittances from England to France must be sent, therefore, in the form of manufac- tures, either directly to France, or to some country with which France has commercial relations. And how would these manufac- tures be obtained ? Of course in exchange for the landlord's rent. His share of the produce of his estates would now go to Birmingham or Sheffield, or Manchester, or London, to maintain the labourers employed in producing manufactures, to be sent and sold abroad'for his profit. An English absentee employs his income precisely as if he were to remain at home and consume nothing but hardware and cottons. Instead of the services of gardeners and servants, uphol- sterers and tailors, he puichases those of spinners, weavers, and cut- lers. In either case his income is employed in maintaining labour- ers, though the class of labourers is different ; and in either case, the whole fund for the maintenance of labourers, and the number of labourers to be maintained, remaining unaltered, the wages of labour would not be affected. M But, in fact, that fund would be rather increased in quantity. ESSAY OX THE RATE OF WAGES. 45 and rather improved in quality.' It would be increased, because land previously employed as a park, of in feeding dogs and horses, or hares and pheasants, would now be employed in |roducing food of clothing for men. It would be improved, feecause the increased pro- duction of manufactured commodities would occasion an increased division of labour, the use of more and better machinery, and the other improvements, which we long ago ascertained to be its neces- sary accompaniments." This distinction will not hold good. The laws of political economy are of universal application, and cannot be changed to suit the particular circflm- stances of a state. Whatever has a tendency to pre- vent the growth of capital, is injurious, while every thing that promotes its groict/i is advantageous. This is the test ; and if it can be shown that absenteeism has a tendency to prevent its growth, in however small a degree, there will be no difficulty in stating what is the law which governs in this case, which has been styled " the opprobrium of political economy." If the landlord receive 1000 quarters of corn, and, as a resident, consume the whole, while, as an ab- sentee, he lives upon 500, applying the remainder to the improvement of his land, there can be no doubt bis absenteeism is advantageous. The question is not, however, between a wasteful resident and an economical absentee, but between two men of the same habits of expenditure ; one li ving abroad, and the other at home. In the one ease the 1000 quar- ters of corn, or its equivalent, are sent to Paris, and the amount is invested in the purchase of commodi- ties. The corn having been sold at its wholesale, and its proceeds applied to the purchase of other articles at retail, prices, it is probable that he receives a D2 40 ESSAY Olf THE RATE OF WAGES. wholesale value, equivalent to 800 quarters of corn, while his tradesmen of Rue Vivienne, or Rue Riche- lieu, add to their capital the remaining 200 quarters. The resident landlord does the same thing at Cork, Dublin, or Limerick, dividing his 200 quarters among his countrymen, by which their capital is increased. It might be fairly estimated, that one-fifth of the amount transmitted to absentee landlords, is thus distributed, in the farm of profits, among foreign tradesmen. The abstraction, in this manner, of a fifth of the whole rents of absentee proprietors, which would undoubtedly be left with the tradesmen, is felt severely in Ireland, where the growth of popu- lation is rapid, and of capital small ; but in Great Britain and the United States, the growth of capital and increase of demand for labour are so great, that although the same result is produced, the effect is too insignificant to be remarked. It can hardly be doubted for a moment, that if all the landlords of Ireland were to conclude to live at home for one year, and expend the same amount among their tenants and tradesmen, that they had been accustomed to expend among the people of London, Paris, or Rome, there would be a greater increase of capital among the mechanics and tradesmen of Ireland, than if they had remained abroad. Less money would be spent in those cities, and there would be a smaller increase of capital than usual. In like manner the absentees of New York and Philadelphia contribute to the support of the hotel keepers and tradesmen of Quebec and Montreal. If they remained at home, and spent the same sum, the ESSAY Off THE RATE OP WAGES. 47 profits would remain with the tradesmen of their own cities. Absenteeism is thus injurious wherever it occurs, tending to impede the growth of capital, but its effect is felt in the ratio of population to capital, and is almost unfelt when that ratio is small, as in England and the United States. A very material deduction is also made by absen- teeism from the means of obtaining employment and consequent reward. To illustrate this, the following case may be stated : An island containing ten mil- lions of acres is the property of one thousand land- holders, and has a labouring population of one million of persons. The average share of each would be ten acres, producing 300 bushels of grain, of which fifty go to the landlord. The fund for the support of the labouring population would be 250 millions, leav- ing fifty millions for the capitalists or land-holders. These persons, however, being resident, have occa- sion for gardeners, coachmen, footmen, &c., and em- ploy each fifty in various capacities, leaving only 950,000 persons for cultivation, who divide among themselves the whole of the land and its product, after paying rent, giving 263 bushels to each. As the wages of the cultivator amount to 263 bushels, it is probable that the persons employed by the land- lord, would have as much ; and as their number would be 50,000, they would receive among them 13 mil- Hons of bushels out of the fund originally assigned to the landlord, increasing that for the support of the labouring population to 263 millions, leaving only 37 millions to the landlords for their support, and for the increase of their capital 48 ESSAY ON THE RATE OF WAGES. If their savings, and those of their tenants, should enable capital to keep pace with population, the lands would be improved, roads and canals would be con- structed, manufactories would be built, the amount of production would be increased, and with it the fund for the labourer, and wages would continue unaltered ; if they went beyond it, they would rise, but if they fell short of it, they would fall. If, however, these one thousand persons should go abroad, leaving their servants, &c., behind them, the thirteen millions of bushels which they had been ac- customed to pay for services, would be paid to fo- reigners, and there would remain only 250 millions to be divided among a million of labourers. The capital in land would remain the same, while the competition for it would be increased ; the labourer would be willing to pay a higher price for its use, perhaps 60 bushels, instead of 50, thus reducing his share from 263 to 240. A further increase of popu- lation would increase the competition, and as there would be a steady excess of demand over supply, the landlord's share would probably rise to 80, 100, or 120 bushels, reducing the fund out of which the labourers were supported, from 263 millions, to 180 or 200 millions. All accumulation on the part of the labourer would be thereby effectually prevented, and if the landlord should expend or invest abroad, the whole of his re- venue, there could be no increase of capital from that source. If, under such circumstances, popula- tion continued to advance, they might be reduced to patches of an acre or two, the gross produce of ESSAY ON THE RATE OP WAGES. 49 which would do no more than afford subsistence, although the unfortunate cultivator would be willing to give one half of it, in preference to being ejected from the land. Such is precisely the condition to which Ireland has been reduced by the extravagance and absenteeism of its landed proprietors. If the absenteeism existed without the extrava- gance ; if the profligate and wasteful landlord were replaced by the honest, active, and intelligent agent ; if the residence abroad produced habits of economy that would admit of the investment in improvements of various kinds, by the agent, of a part of the reve- nue, absenteeism would be a blessing instead of a curse. The following passage from Mr. Inglis's new work, "Ireland in 1834," confirms these views. Mr. I. visited Ireland strongly impressed with the neces- sity of poor-laws to counteract the ill effects of ab- senteeism, and is in this case a most unexceptionable witness. " It must not be imagined that the people on all absentee estates are in a worse condition than they are upon those estates where there is a resident landlord. The condition of the peasantry depends on the circumstances under which the lands are occupied, much more than upon the residence of proprietors, and I cannot say that it is generally an easy matter to guess whether the landlord be absentee or resident. Some of the most comfortable tenantry in Ireland are found on absentee properties, and some of the most miserable on es- tates upon which the proprietor resides ; there is no doubt, however, that where a well-disposed and unembarrassed landlord resides, fewer unemployed labourers are found, the condition of the labourer is better, and the retail trade of the most adjacent towns is material- ly benefited. Vol. II. p. 256. In the United States capital in land is abundant, 50 ESSAY Off THE RATE OF WAGES. circulating capital increases with great rapidity, and the demand for labour is consequently great. Should the capitalist conclude to live abroad, his coachman, footman, gardener, and all others who have been ac- customed to live out of his income, can readily find employment, and notwithstanding the fact that nearly the \vhole of the exports consist of raw produce, it is scarcely of the slightest importance whether he lives abroad or at home. The foreign capitalist who places his funds in the United States is an absentee, but if he were to reinvest the proceeds here, so far as not required for his subsistence, he would be nearly as useful as if he were to remove here with his capi- tal ; notwithstanding which, there is a constant jeal- ousy of the investment, by foreigners, of their capital in either bank stocks or real estate. In some of the states there is an absolute prohibition to hold them. It is difficult to conceive of a greater absurdity. The men who oppose a tariff upon cotton goods, would prohibit the importation of capital ! The British go- yernmenthas wisely offered inducements to foreigner! to invest their surplus funds in its stocks, and large amounts are so invested, yet it would be difficult to point out any difference between the absentee land- lord, who left his estate in Surrey or Kent, and the absentee fund-holder who left his money in London, Yet the same persons who inveigh against the former, would deem it injudicious to prevent investments of the latter description. Having shown, by the case of this country, that the position of Mr. S. in regard to countries exporting raw produce, is not correct, the question arises, would ESSAY ON THE RATE OF WAGES. 51 it be more so, if the r opulation above supposed to exist were exclusively engaged in manufactures, and exported nothing else. If the one thousand landed proprietors were converted into an equal number of capitalists, owning extensive manufacturing establish- ments, and their portion of the profits were remitted to them in cottons, instead of, as in the other case, grain, what would be the difference ? It is obvious that their interest, or rent, or profits, could perform but one operation instead of two, as suggested by Mr. Senior. It would be difficult to imagine any disad- vantage arising out of the transmission of rent from Ireland, that would not arise in such a case as the one now stated. No law of political economy can be correct unless universally so, and that propounded by Mr. S. is certainly not so as regards the United States, which exports only raw produce ; nor, even according to his own theory, would it be so in rela- tion to one which was exclusively engaged in manu- factures, and exported nothing else ; nor as regards the capitalist of England, who lives abroad, having lent his capital to an English manufacturer, who ex- ports the interest in the produce of his manufacture; nor to the agriculturist of Ireland, who exported the interest in corn. The people of Ireland suffer under the absenteeism of the landlord, who leaves his capital behind him, and those of Great Britain under the forced absentee- ism of capital, the owner of which stays at home. The absurd system of corn laws, by preventing ex- changes, prevents the employment of capital in manu- factures, and it is therefore sent abroad to seek that 52 ESSAY ON THE RATE OF WAGES. reward which is denied to I* at home. It is sent to the United States to aid in the construction of canals arid rail roads, and the erection of manufactories, and the labour that might be employed at home, is sent to assist in using that capital, and in consuming that corn, a market for which is refused in Great Britain.* * Since writing the above, I have looked into Pebrer's work on the British Empire, arid find the following remark in corrobora- tion of the views above given. " There is found an immense excess of capital, the very source of production, causing distress instead of prosperity among its owners. An extraordinary excess of labour, the very cause of wealth, producing poverty, ruin, and misery among the labourers, themselves a great and powerful empire, when know- ledge, invention, and art, have multiplied in a boundless manner tfee means for the enjoyment of life, and for the satisfaction of all its wants, comforts, and luxuries; but when the very perfections of these springs of human and social happiness occasion misfortune, distress, and perpetual agitation, among the members of that great empire itself." page v. The object of Mr. Pebrer's work is to ascer- tain the cause of the difficulties under which Great Britain labours, and to point out a remedy. Laying aside all consideration of the im- pediments in the way of freedom of action and of exchange^ he attri- butes the whole difficulty to excess of taxation, which he supposes to have the effect of raising tkt price of labour, and preventing the sale of their manufactures. He holds up the case of Spain as a warning, and says : " It is to her bad fiscal laws, to her bad system of im- posts, to the taxes on consumption, which enhanced wages, and pre- vented the sale of her manufactures, that the misfortunes of Spain must be attributed; these, and no other, were the true causes of that wide spread devastating laziness, which still desolates and impove- rishes a land worthy of a better fate." p. 542. Considering wage* as always at a minimum, and the heavy taxes on consumption as the cause of their high rate in England, the remedy is to be found in the abolition of those taxes, which can only take place when the debt shall have been paid off. To accomplish this object in part, it is proposed to raise 500 millions of pounds by a tax on all property in Great Britain and the Coloniet, which latter are to be induced to ESSAY ON THE RATE OF WAGES. 53 It is this abstraction of capital which causes the re- dundance of labour, and yet it has been seriously pro- posed in the Quarterly Review to tax all capital in- vested in machinery, as a means of raising the price of labour ! This would drive it abroad still more ra- pidly, and wages would rise here while those of Great Britain would fall below their present standard. No great improvement is likely to take place until the corn laws are repealed and the workman is al- lowed to procure food from those who will give it him at the lowest price. Mr. Senior advocates this- and the repeal of the poor laws, but deems it neces- sary to prepare therefor by a free exportation of the shrplus population. He says, " The only immediate remedy for an actual excess of population is an an- cient and approved one ; coloniam deducere" In the existing state of things, colonization may be beneficial agree to it by the prospect of advantage to their commerce. Such an arrangement would have one good effect, that of throwing the burthens of the government upon the holders of property, who have been accustomed to shuffle them off upon the unfortunate labourers, but it would not reduce wages in the manner supposed by Mr. P. Although the ultimate effect would be to raise wages by reducing the cost of articles of consumption, it is not improbable that the first effect produced by such an arrangement might be to depress them, The two years in which it is proposed that this assessment should be paid, would probably be "years of confusion," arising out of the transfer of property under circumstances little calculated to satisfy the owners of it, or to give confidence to the trading community, and it is not improbable that the loss to the nation, arising out of euch a measure, would be greater than the whole amount raised by it. Let Great Britain throw off the shackles which interfere with the free action of her people, and the free exchange of her production*, and her debt will ceate to be of moment to her, 54 ESSAY Off THE RATE OF WAGES. to both the mother country and the colonies, and as the people have been deprived of the means of trans- ferring themselves, it may perhaps be well to let it be done at public expense, but it is highly improbable that the nation will be more prepared for the abolition of the corn laws after sending away half a million of people, than at the present time. Unless the removal of restrictions proceed pari passu with the removal of the population which is rendered surplus by re- striction, it certainly will not The capital which is thus driven abroad by the corn laws of England, is employed in the United States to remove restraints imposed by nature upon the trade in corn and other articles of produce. They laboured under a deficiency of circulating capital, aid the consequence was that communications in many parts of the country were very bad, and the difference in the prices of corn very considerable. When it was proposed to make some of the great public improve- ments that have since been completed, it was suppos- ed that the effect would be to raise the price of lands in the west, and in a corresponding degree reduce those nearer the cities which had before been very valuable, or precisely the same effect that is now anti- cipated in England from a repeal of the corn laws. New York and Pennsylvania have completed their great works, by which they have repealed their corn laws, and so far from the repeal having had the effect of reducing the price of lands within forty, fifty or onehundred miles of their capitals, those lands have materially advanced in price in consequence of the general prosperity, to which those improvements have largely contributed ESSAY Off THE RATE OF WAGES. 66 by increasing the facilities of communication and in- terchange. A similar repeal of the English corn laws would, without doubt, be attended with similar effects, and land owners would find that the prosperity which would be the result of such a change of system, would cause their lands to be more valuable than they had beh under the restrictive system, and in addition, they would have the satisfaction of knowing that their rents were not forced contributions from the unfortu- nate manufacturers for their benefit The experience of the United States should satisfy the people of Eng- land, first, that no loss is likely ,to arise to the land owners from the freedom of trade in corn, and se- cond, that absenteeism is not necessarily, productive of evil, as nearly all the great public works of this coutftry have been made with the capital of absentees. It is singular that English writers who are so ner- vous in regard to English and Irish absenteeism, should have so little thought of the effect of it in India. The landlord of all India is an absentee, and his agents are little better, as all their surplus profits are trans- ferred to Englandf*with a view of returning home as soon as their capital shall be sufficient to make way for a new swarm who will do the same. If so much effect be produced in Ireland, what must be tUa con- sequence in India? 56 ESSAY Off THE RATE OF WAGES. CHAPTER V. THE fourth error adverted to by Mr. S. is, " That the general rate of wages can be reduced by ma- chinery." Few persons now doubt the advantages of machinery to the labourer, and if those who still continue to do so, would reflect that the greater the amount of production, the greater must be the fund of commodities to be divided between the capitalist and the labourer, and, that the rate of interest, which indicates the usual rate of profit, has not varied mate- rially for many years, showing that the capitalist cannot take an extraordinary share of the increased product, they would see that the fund for the support of the labourers must be increased in the full propor- tion of the increased production, and consequently, that the share of each must be larger. The greatly increased consumption of all articles used by that class ought to be sufficient evidence on this head The average consumption of cotton goods in Great Britain, from iai6to 1820, was 227 millions of yards, and that of 1824 to 1828, four hundred millions! It is not improbable that it is now 500 millions, or about twenty yards per annum to each individual. The value of this immense quantity, at five pence a yard, would little exceed ten millions of pounds ster- ling, while at 2s. Qd. t the price about thirty years since* it would be about sixty millions; or at 6s. the yard* ESSAY OJT THE RATE OF WAGES. 67 the price about forty-five years since, it would amount to one hundred and fifty millions of pounds. To the improvements in machinery of the last half century alone it is owing that the people of Great Britain have been able to bear such an excessive amount of taxa- tion, under which any other nation must have sunk. " Every new invention and discovery, by which the production of commodities can be facilitated, .and their value reduced, enables individuals to spare a larger quantity of them for the use of the state." Par- nett, p. 11. It is but a short time since that one of the most re- spectable and intelligent editors in the Union, in no- ticing some improvement in machinery, expressed his regret that human labour should in this manner be superseded ; that locomotive engines should take the place of thousands of men and of horses who had been accustomed to be employed in the transportation of merchandise. Yet this same editor is among the ablest advocates of one of the principal canals now in the course of construction. A little reflection would satisfy him and all other opponents of machinery that the same objection which lies against the use of loco- motive power, would lie against the rail road itself,- and equally against the canal the turnpike the common road, and even the horse path. If the ob- ject be to employ the greatest number of persons in doing a given amount of transportation, dispense en- tirely with carriages and roads for them, and let the whole be done on the backs of mules, as is in a great measure the case in Spain ; or still further, dispense 58 ESSAY Off THE RATE OF WAGES. with horses and mules, and employ manual labour exclusively as in China. The fifth error is, " That it can be reduced ty the import of foreign commodities." "Fifthly."* Closely connected with this mistake, and occasioned by the same habit of attending only to what is temporary and par- tial, and neglecting what is permanent and general; of dwelling on the i v:l that is concentrated, and being insensible of the benefit that is diffused, is the common error of supposing that the general rate of wages can be reduced by the importation of foreign commodities. In fact the opening of a new market is precisely analogous to the introduction of a new machine, except that it is a machine which it costs nothing to construct or to keep up. If the foreign commo- dity be not consumed by the labouring population, its introduction leaves the general rate of wages unaffected ; if it be used by them, their wages are raised as estimated in that commodity. If the ab- surd laws which favour the wines of Portugal to the exclusion of those of France were repealed, more labourers would be employed in producing commodities for the French market, and fewer for the Portuguese. Wages would temporarily fall in the one trade, and rise in the other. The clear benefit would be derived by the drinkers of wine, who, at the same expense, would obtain more and better wine. So if what are called the protecting duties on French silks were removed, fewer labourers would be employed in the direct pro- duction of silk, and more in its indirect production, by the produc- tion cf the cottons, or hardware, with which it would be purchased. The wearers of silk would be the only class ultimately benefited; and as the labouring population neither wear silk nor drink wine, the general rate of wages would, in both cases, remain unaltered. But if the laws which prohibit our obtaining on the most advan- tageous terms tea and sugar, and corn, were altered, that portion of the fund for the maintenance of labour, which consists of corn, su- gar, and tea, would be increased. And the general rate of wages, u estimated in the three most important articles of food, would be raised." It is an error to suppose that the wearers of silk ESSAY OIT THE RATE OF WAGES. 69 would be the only persons ultimately benefited in this case. If the labour of twenty thousand persons be now required to produce silks, which, under a different system, could be obtained in exchange for the labour of ten thousand employed in the produc- tion of cottons, the whole amount of production of the remaining ten thousand would be added to the fund of commodities. If the importation of silks were doubled in consequence thereof, it would be equiva- lent to a large increase in the amount of production, and although the labourer might not obtain a silk gown for his wife, there would be a larger portion of cotton goods for his share ; but the experience of this country proves that even the wife of the labourer may, with a system of free trade, obtain one of silk. If it remained the same, the wearers of silks would add to their capital one half of the sum they had been accustomed to expend for them, and this increase of capital, by increasing the demand for labour, would tend to produce an augmentation of wages. The laws of political economy are universal in their application, and none more so, than that restraints upon the free- dom of trade are injurious to all classes of society, and all measures tending to the removal of those restraints, advantageous, even to those who consume none of the particular articles the importation of which is thereby promoted. The sixth error indicated by Mr. Senior is, " That the unproductive consumption of landlords and capi- talists is beneficial to the labouring classes, because it finds them employment" No benefit can arise from 60 ESSAY 0V TBS RJifE OF WAGES. employment, unless it tend to increase thei amount of production. Where it does this, it has a tendency to raise wages, while any species of employment that tends to decrease production, must reduce them. Many persons are honestly opposed to machinery, but if they would reflect, that the quantity produced is greatly increased by the use of it, while it does not increase the number of consumers, they would see that the effect must be to increase the quantity of commodities that falls to the share of each labourer. If those persons who are opposed to machinery would take the trouble to examine what would be the effrct upon the growers of cotton and consumers of cotton goods, (among whom are, of course, the cotton manufacturers,) the owners of ships, and pro- prietors of canal and rail road stocks, and the im- mense number of persons that are employed in navi- gating those ships, and directing the canal boats, rail- road cars and engines, of abolishing the spinning jenny and power loom, under the mistaken notion of increasing the demand for manual labour, they would never again say a word on the subject. The seventh and last error is that of Mr. Ricardo, that it is better to be employed in the production of services, than in that of commodities, or, as Mr. Se- nior says, " better to be employed in standing behind chairs, than in making them; or as soldiers and sailors, than as manufacturers." Mr. M'Culloch, allowing his views of the conflicting interests of wages and profits to mislead him also, says, that " the demand for a large number of men, for the ESSAY OIT TH* RATE OF WAGES. 61 supply of armies and fleets, must raise wages, in consequence of the increased demand which it pro- duces, and that the increase of wages must come from profits." As the amount of real wages depends upon the quantity and quality of the commodities obtainable by the labourer, and as that depends upon the total amount of production, this theory must re- main unsusceptible of proof, until it can be shown that in any given community a greater amount of commodities will be produced where one-half of the population is employed in standing behind chairs, or shouldering muskets, than when the whole are em- ployed in the business of production ; or when the half shall be shown to be greater than the whole. If Mr. M'Culloch's views on this subject were gene- rally received, it would not be extraordinary that wars should be popular among the labouring classes, but if they could be made to understand their own interests, they would be sensible that " War is mis- chievous to every class in the community; but to none is it such a curse as to the labourers." Senior. u War is a game, which, were their subjects wise, Kings would not play at," 69 ESSAY Off THE RATE OF WADES. CHAPTER VI. THE reader has seen, that in the Lectures on Wages which have been considered, Mr. Senior has taken the quantity and quality of commodities as the measure of wages, but in that " On the Cost of Ob- taining Money," which it is proposed now to con- sider, he assumes the money price of labour as the standard of comparison. It must be obvious, how- ever, that the cost of obtaining silver is only the cost of obtaining commodities that will exchange for it, and that whether a day's labour be estimated as equal to a bushel of wheat, or to so much silver as can be obtained for it at the nearest store, the result is the same. Where they have reference to the same places, and at the same times, Mr. S. considers them as convertible terms, and his object in using the mo- ney price in the present instance, is to assume that as a measure of the powers of production of the seve- ral countries. There is, however, a very serious ob- jection to its use for that purpose, arising out of the different modes of taxation, in different countries, even when the amount is the same. In India almost the whole taxation is direct, and is taken in the form of rent, before the labourer re- ceives his share. In England, on the contrary, direct taxation is small, while that upon consumption is large, and is taken from the labourer after he has KSSAY 05 TKfc RATE Of WAGES. 63 received, his share. To show the effect of this, I will suppose tHe following case. A man in England raise* three hundred bushels of wheat, fifty of which go to his landlord as rent, and twenty to the state as land tax, leaving him two hundred and thirty bushels as the rewards of his labour, or wages and interest of capi- tal. In exchanging this for tea, sugar, coffee, &c. he pays, I will suppose, as a tax on consumption, eighty bushels, leaving him one hundred ancl fifty bushels. In India, another man, raising the same quantity, would have paid one hundred and fifty bushels as rent and tax, leaving his wages exactly the same, although apparently above one third less. Again, where the mode of taxation is the same, money wages, although they may be taken as a mea- sure of the powers of production, cannot be taken as an evidence of the extent of real wages, unless allow- ance be made for the difference of amount of taxa- tion. In England, money wages are nearly as high as in the United States, yet the greater amount of the claims of the state makes a vast difference in the quantity and quality of commodities at the labourer's command, which is the only measure of real wages. In the following extract will be found Mr. Senior's views as to the actual amount of wages, and the causes of the difference that exists : " The average annual wages of labour in Hindostan are from one pound to two pounds troy of silver a year (from fourteen to twenty- eight dollars). In England they are from nine pounds to fifteen pounds troy ($126 to $210 average $168, 01 35). la Upper Ca- nada and the United States of America, they are from twelve pounds troy to twenty pounds (1168 to $280 average $224, or 46 13$.). 64 ESSAY Off THE RATE OF WAGES. Within the same time the American labourer obtains twelve times, and the English labourer nine times as much silver as the Hindoo. u The difference in the cost of obtaining silver, or, in other words, in the wages of labour in silver, in different countries, at the same period, has attracted attention, though not perhaps so much as it deserves, and various theories have been proposed to account for it " It has been attributed to the different degrees of labour requi- site to obtain the necessaries of the labourer. In Hindostan it has been said, he requires little clothing or fuel, and subsists on rice, of which he obtains a sufficient quantity with little exertion. But how then do we account for his wages in North America being twenty-five per cent, higher than they are in England, while the labour requisite to obtain necessaries is not much more than half as great in the former country as in the latter ? How do we ac* count for the low amount of wages in silver in China, where the labour necessary to obtain necessaries is proverbially great? " It has been attributed to the different densities of population. In Hindostan and in Ireland, it has been said, labourers multiply so rapidly, that the market is overstocked with labour, and the price falls from the Increased supply. But if this were an universal rule, as the population of England has doubled in the last seventy or eighty years, wages ought to have fallen, whereas they have doubled or trebled in that interval. They have kept on increasing in North America during a still greater increase of population. They arc, perhaps, twice as high in Holland as in Sweden, though the population of Holland is ten times as dense as that of Sweden. M It has been attributed to the different pressure of taxation : but taxation is no where so light as in America, where wages are the highest. It is, probably, heavier in Hindostan than in England, yet wages are nine or ten times a-bigh in England as in Hindostan. So that it might seem that wages are highest where taxation M lowest; but, on the other hand, taxation is lighter in Prance than in England, yet wages are lower, and lighter in Ireland than in France, yet wages are lower still. It appears, therefore, that there is no necessary connexion between taxation and wages. u It has been attributed to the different rates of profit The ave- rage fate of profit in England is supposed to be about one-tenth, or about eleven per cent per annum. In Hindoctan and America it it ESSAY ON THE RATE OF WAGES. 65 higher. We will suppose it to be one-sixth, or twenty per cent, per annum, which is probably far too high an estimate. This differ- ence would account for the labourer, whose wages have been ad- vanced for a year, receiving nine-tenths of the value of what he pro- duces in England, and only five-sixths in America and Hindostan, or rather is only a different expression of the same fact, but it does not afford even a plausible solution of the present question. " If the difference in wages were solely occasioned by a differ- ence in the rate of profit, whatever is lost by the labourer would be gained by the capitalist, and the aggregate value in silver of a com- modity produced by an equal expenditure of wages and profits, or, in my nomenclature, by an equal sum of labour and abstinence, would be every where the same ; and in that case, how could both wages and profits be higher in North America than in England ? " Taking North America as the standard, and that the value in silver of the produce of a. year's labour of one man, his wages hav- ing been advanced for a year, is two hundred and eighty ounces of silver, the value in silver in Hindostan and in England, of the pro- duce of a year's labour of one man, his wages having been advanced for a year, would also be two hundred and eighty ounces, and as the labourer receives only twenty-four ounces of silver in Hindostan, and only one hundred and eighty ounces in England, the Hindoo capitalist must receive, on the sum advanced by him in payment of wages, a profit of more than two hundred and fifty -six ounces, or above one thousand per cent, per annum ; and the English capitalist more than one hundred ounces, being more than sixty per cent, per annum, which we know to have no resemblance to the fact. If my statements and suppositions as to the average wages of labour, and the average profits of capital in England, Hindostan, and America be correct, a commodity unaffected by any monopoly produced by the labour of one man for a year, his wages having been advanced for a year, must sell in Hindostan for from one pound two ounces, to two pounds four ounces of silver ; that is, for from twelve to twenty-four ounces as the wages of the labour, and from two to four ounces as the profit of the capital employed. In England such a commodity must sell for from about nine p6unds nine ounces, to about sixteen pounds three ounces. In America for from fourteen pounds to twenty-three pounds four ounces- In other words, the same sum of labour and abstinence, or, in other words, the samt P 06 ESSAY ON THE RATE OF WAGJSS. sacrifice of ease and of immediate enjoyment, obtains in America twenty-three pounds four ounces; in England sixteen pounds three ounces; and in Hindostan two pounds four ounces. And this differ* encc is the phenomenon to which I am calling your attention. u It has been attributed to the different prices, in silver, of neces- saries. Provisions, it is said, are dearer, that is, exchange for more silver in England than in France; therefore, the labourer must re- ceive more silver to enable him to purchase them. But provisions are cheaper in America than in England, and yet the labourer re- ceives much less silver in England than in America. The produc- tiveness of the worst soil cultivated, the period for which capital is advanced, and the rate of profit being given, it is clear that the ave- rage price in silver of corn, must depend on the average wages in silver of labour, not the wages of labour on the price of corn. On my hypothesis, that the services of an English labourer for a year, his wages having been advanced for a year, are worth about nine pounds nine ounces of silver, the corn produced by him in a year on the worst land, his wages having been advanced for a year, must be worth nine pounds nine ounces of silver, and cannot be perma- nently worth either more or less. If his wages fall one-half, the rate of profit remaining the same, the corn mast be worth four pounds ten ounces and a half. If they double, it must be worth nineteen pounds six ounces. But in all cases, the productiveness of the worst land cultivated, the period for which wages are advanced, and the rate of profit remaining the same, the average amount in silver of wages must regulate the average value in silver of corn, and not the value in silver of corn the amount of wages. To suppose the con- trary, is in fact the vulgar error of putting the cart before the horse, or mistaking the effect for the cause. To use Adam Smith's illus- tration, ' It is not because one man keeps a coach while his neigh- bour walks a-foot, that the one is rich and the other is poor; but because the one is rich he keeps a coach, and because the other is poor he walks a-foot' M If the population of England should maintain its present rate of advance ; if our numbers should continue to increase at the rate of more than five hundred persons every twenty-four hours, and the absolute prohibition of foreign corn, for which a violent faction is now clamouring, should be conceded, there can be no question that tven though wages should not rise, the price of corn would advance. ESSAY OBT THE RATE OP WAGES. 67 The constantly increasing additional quantity which must be raised to supply an annual addition of fifty thousand families, would be raised at a constantly increasing proportionate expense. According to the theory which I am considering, the wages of the labourer would rise in proportion. For what purpose would they rise ? To enable him to consume the same quantity as before, though the whole quantity raised would bear a less proportion than before to the whole number of producers ? On such a supposition wages might be ten guineas a day, and corn ten guineas a peck. According to the "present administration of our poor-laws, which allots to each individual a definite quantity of corn, to be given by the landlord as relief when not paid by the employer as wages, the whole amount received by the labourer in the two forms of relief and wages might rise, not indeed ad infinitum, but until it had absorbed the whole amount of rent and tithes, had converted the landlords and clergy into trustees for the poor. And this is the state of things which, under the united influence of corn laws, even such as they are now, poor laws, and an increasing population, seems gradually approach- ing. But in the absence of poor laws, what reason would there be for expecting a rise in wages ? Because the labourer would want more? But would the labourer's wants give to the capitalist the power or the will to pay him more? Does the Manchester manufac- turer pay his fine spinners '30s. a week, and his coarse spinners 15*. because the fine spinner eats twice as much as the coarse spinner? He pays the fine spinner 30. because the produce f his labour is worth 30s., and a further sum equal to the average profit obtained by a manufacturing capitalist, and because, if he were to offer less, other capitalists would engage his labourers, and his machinery would stand idle. While the labourer's services are worth 30. he will receive 30., whatever be the price of corn. To suppose the contrary, is to consider the labourer not as a free agent, but as a slave or domestic animal, fed not according to his value, but his ne- cessities. " All experience shows that in the case which I have been sap. posing, the labourer's resource would be, not to raise his wages, but to reduce his expenditure. He must first give up his weekly pit. tance of animal food. He must drink his tea without sugar, and surrender his pipe, and perhaps his4>eer. He must sink from wheat to rye, or barley, or oatmeal, and from oatmeal to potatoes. He must look on the wheat which he would raise, as he now does tib 68 ESSAY ON THE RATE OP WAGES. the sheep and cattle that he tends, as a luxury beyond his enjoy- ment. The price of corn if? nearly as high in Ireland as in England; but have the wages of the Irish labourer risen to enable him to con- sume It 1 Did the exportation of corn and cattle from Ireland cease even during the rages of famine, and of pestilence occasioned by famine 1 "The only mode by which I can account for the phenomena which I have been describing is, by supposing that the countries which have the precious metals to dispose of, either as producers, or as having a temporary superfluity at their own current rate of prices, are willing to give more than one-fourth more for the ex- portable commodities produced by the labour of one North American in a year, assisted by an advance of capital equal in value to his wages for a given period,, than for the commodities produced by the labour of one Englishman, and more than ten times as much as for the commodities produced by the labour of one Hindoo, similarly circumstanced. Or in other words, that the diligence and skill with which English labour is applied, enables the English labourer to produce in a year exportable commodities equal in value to those produced in a year by eight Hindoos ; and that the diligence and ?kill with which North American labour is applied, inferior as they are perhaps to our own, yet by the assistance of the fertile soil which be cultivates, enable the North American labourer to produce ex- portable commodities more than one-fourth more valuable than those produced by t.' 10 Englishman in a given period, and more than ten times more valuable than those produced by the Hindoo. Or to use a still more concise expression, that labour in England is eight times as productive of exportable commodities as in Hindostan, and labour in North America is one-fourth more productive of exportable com- modities than in England." Having thus taken money wages as the measure of production, without allowance for the effect pro- duced by the mode of taxation in increasing their apparent difference, Mr. Senior has fallen into the error of supposing a much greater difference in the reward of the labourer than really exists, as I pro- pose to show. By the following statemeats the reader ESSAY 017 THE RATJfi OF WAGES. 69 will be enabled to compare the rate of money wages of England and the United States. I propose, on a future occasion, to examine what is the amount of real wages. The number of persons employed in the cotton manufacture of the" United States is thus stated in the memorial of the New York Convention, 1832: males, 18,539 ; females, 38>927; children, 4,691 ; hand weavers, 4,760 ; in all, 66,917 ; total wages, $ 10,294,944, equal to $3 or 12s. 6d. per week. In the History of the Cotton Manufacture, by Mr. Baines, (p. 511) the above amount of wages is taken, but the children and hand weavers are omitted, by which the number of operatives is reduced to 57,466, and the wages are thereby made to appear to be 14s. lid. per week. Mr- Baines's reasoning in rela- tion to the comparative wages of the United States and England, is thereby vitiated. It is to be regretted, that the gentlemen by whom the report was drawn up, did not give the average wages of men, women, and children. As they have not done so, we must endeavour to estimate them. 18,539 men, at $5 per week, would be $98<695 38,927 women, at $2 p^ week, 4,691 children, at $1 75 per week, 4,760 hand weavers* at $4 per do* $197,800 52 weeks, al $197,800 each, would be $10,285,600, being nearly the amount given in the report In the above, it will be observed, that only about *F 70 ESSAY ON THE RATE OP WAGES. seven per cent are termed children, and even those are much above the age at which children are em- ployed in England. At Lowell, the number employed below 16 is very small, and none below 12. In the Lawrence Factory at that place, out of 1000 females, only 129 are below 17, and of the males there are 28 below that age. Deducting those over 16, those below that age, or who may properly be styled children, cannot exceed eight per cent of the whole number employed, which is 1160. In a summary of the returns to the questions of the Factory Commissioners, of 151 owners of cotton mills, in Lancashire, Cheshire, and Derbyshire, for five weeks, ending May 1833, it is stated, that out of 48,645 persons employed, 20,084 are under 18 years of age. The average wages in these mills, are 10*. 5d.. In an estimate of the number of persons employed in the cotton mills of England, the total number is given at at 212,800,f of whom 43,703 are under 14 years of age, and 39,554 between 14 and 18. One half of the latter being deducted, the total number employed below 16 years, would be 63,480, or 30 per cent of the whole quantity. Notwithstanding the vastly greater quantity of inferior labour thus used, wages are estimated at 10s. 6d. per week, or within two shillings of what was paid in the United States in 1832. Dr. James Mitchell was employed under the Fac- tory Commissioners, to draw out tables, showing the Baines, p. 371. t Ibid. p. 379. ESSAY Off THE RATE OF WAGES. 71 wages, health, &c. of the factory operatives) and the results of some of the principal cotton mills, embrac- ing 7614 operatives, are as follows: * 1415 males below 16 2355 males above 16 1278 females below 16 2566 females above 16 giving above 35 per cent, below the age at which children are usually employed here. As wages differ very much with age, and as it is to be supposed that the efficiency of the labourer is in proportion to the wages received, the only fair mode of comparing those of the United States and England, is to strike off all whose ages are below that at which they are here employed. The average wages of persons above 16, in those factories, as given by Dr. Mitchell, are as follows : 2355 males, 16s. 3d. 2566 females, 8s. 4921 general average 12s. or within 6d. as much as the average of the estimate furnished by the New York Convention. It may be said, that seven per cent of the labourers employed in the United States being below 16, there should be some allowance made therefor, but they are gene- rally so little below that age, that any allowance would have small effect upon the result. The great disproportion that exists between the two countries, in the employment of male and female labour, cannot fail to strike the reader. In England, the females exceed the males by only about 9 per * Baines. p. 437. 72 ESSAY 0!T THE RATE OF WAGES. cent, while in the United States they exceeded them* agreeably to the above statement, by above 110 per cent. Since that time, great improvements have taken place in machinery, increasing the proportion of females very greatly, as will hereafter be shown* At first sight, it might be supposed that this should cause wages to be lower here, the labour of men being generally more productive than that of women, and that this would be an offset to the number of children employed in England. Such is not, however, the case, women being employed here because every thing is done to render labour productive, while there a large portion of the power of the male operatives is wasted. By the above statement it is shown, that in the United States there were only 4760 hand weavers in the year 1832, and the number can hardly be sup- posed to have increased. From the great influx of emigrants from Ireland, it is probable that there will be, for a long time to come, an equal number ; but the modes of employment are so numerous, that a large number must be annually absorbed. On the 1st January, 1835, there were in the town of Lowell 6051 power looms, or more, by nearly 300, than the whole number of hand looms in this country. The whole number of power looms in England, in 1820, was 14,150 in 1829 it had risen to 55,500, and is now supposed to be 85,000, which, with 15,000 in Scotland, would give a total of 100,000.* During this time it is supposed that the number of * Baines* p. 238. ESSAY ON THE RATE Of WAGES. 73 hand looms has rather increased, and it is now esti- mated at 250,000. The condition of the weavers is thus described: " The hand-loom weavers,' says Dr. Kay, speaking of those living in Manchester, ' labour fourteen hours and upwards daily, and earn only from five to seven or eight shillings per week. They consist chiefly of Irish, and are affected by all the causes of moral and physical depression which we have enumerated. Ill-fed, ill- clothed, half-sheltered, and ignorant weaving in close, damp cel- lars, or crowded, ill-ventilated workshops it only remains that they should become, as is too frequently the case, demoralized and reckless, to render perfect the portraiture of savage life.' The state- ment that the weavers work fourteen or sixteen hours per day, has been so often made, that it is now generally believed. The fact, however, is, that they work these long hours only two or three days in the week, and they generally, notwithstanding their poverty, spend one or two days in idleness; their week's labour seldom ex- ceeds fifty -six or fifty-eight hours, whilst that of the spinners is sixty-nine hours. This irregularity on the part of the weavers is to be ascribed in some degree to the wearisome monotony of their labour, from which they seek refuge in company and amusement ; and also to their degraded condition, which makes them reckless and improvident"* It may be asked, why they should continue in an employment so degrading. " These were the occasions and direct causes of the lamentable fall in weavers' wages ; but their effects could not have been so serious if there had not been permanent causes, belonging to the nature of the employment itself. Of these, thejirat and grand cause is, the easy nature of the employment. The weaving of calicoes is one of the simplest of manual operations, understood in a few mo- ments, and completely learnt in a few weeks. It requires so little strength or skill, that a child eight or ten years of age may prac- tise it A man brought up to any other employment may also very shortly learn to weave. From the facility of learning the trade, * Baines, p. 485. 74 and from its being carried on under the weaver's own roof r he natu- rally teaches his children to weave as soon as they can tread the treadles, if he cannot obtain places for them in a factory. Thus they begin at a very early age to add to the earnings of the family, and the wife also toils in the same way to increase their scanty pittance. But it is obvious, that that which is only a child's labour, can be remunerated only by a child's wages. There are large de- partments of hand-loom weaving, which are almost entirely given up to women and children, and their wages go far to regulate all the rest. The men, where they are able, procure better kinds of work ; and where they are not able, they must put up with the moat paltry earnings. The second cause for the low wages of weavers is, that their em- ployment is in some respects more agreeable^ as laying them under leu restraint than factory labour. Being carried on in their own cottages, their time is at their own command : they may begin and leave off work at their pleasure : they are not bound punctually to obey the summons of the factory bell : if they are so disposed, they can quit their loom for the public-house, or to lounge in the street, or to accept some other job, and then, when urged by necessity, they may make up for lost time by a great exertion. In short, they are more independent than factory operatives ; they are their own masters ; they receive their materials, and sometimes do not take back the web for several weeks ; and what is a lamentable, but far too common occurrence they have the power, in case of urgent necessity or strong temptation, to embezzle a few cops of their em- players' weft in order to buy bread or ale. All this makes the weaver's occupation more seductive to men of idle,, irregular, and dissipated habits, than other occupations. It is a dear-bought, miserable liberty, but, like poaching or smuggling, it is more con- genial to some tastes, than working under precise restrictions for twice the remuneration. The mention of thio unquestionable fact by no means implies a charge against the weavers, that they are aft of loose habits and morals ; but it helps to account for many continuing at the loom, notwithstanding- the wretchedness of their circumstances."* Various estimates have been made of the wages of weavers, as will be seen by the following extract: * Baines, p. 493. ESSAY ON THE RATE OF WAGES. 75 * The weekly wages of several classes of hand-loom cotton weavers, in each year, from 1810 to 1825, have been given in a table at -p. 438; and their wages in 1832 are given in a table at p. 439. The former states the wages of the weavers of calicoes at the astonish- ingly low rate of 4s. 3d. in the year 1825 ; but these goofc were chiefly woven by women and children. The latter table does not mention the prices paid for calicoes ; but it shows that in 1832, the average wages for weaving common checks, common nankeens, and cambrics, all of which are woven principally by women and chil- dren, were from 6s. to 6s. 6d., 7s., and 8s. ; the wages for fancy checks, woven by men, were 7s. to 7s. 6d. ; and for fancy nankeens and quillings, from 9s. to 12s., 13s., and even 15s. Mr. George Smith, of the film of James Massey and Son, of Manchester, gave evidence before Ui* Committee of the House of Commons on Manu- factures, Commerce, &c., in July, 1833, that the weavers of calicoo* in the neighbourhood of Burnley and Colne earned little more than 4s. per week net wages : these, however, were almost all children t of the whole number of hand-loom cotton weavers in the kingdom, which he estimated at 200,000, he supposed that 30,000 earned this low rate of wages ; whilst the remaining 170,000 would only earn 6s. or 7s. a week : in the neighbourhood of Manchester he thought the average would be 7s. Mr. John Makin, a manufacturer, of Bolton, stated before the Committee of the Commons on Hand-loom Weavers, in July, 1834, that a weaver of the kind of cambric most commonly produced there, namely, a six-quarter 60-reed cambric, 120 shoots of weft in an inch, could only weave one piece in a week, the gross wages for which were 5s. 6d. subject to a deduction of about Is. 4d. Hugh Mackenzie, a hand-loom weaver of Glasgow, informed the same Committee, that the average net wages of the weavers of plain goods in that city and neighbourhood, would scarcely amount to 5s. per week. Mr. William Craig, a manufac- turer of handkerchiefs and ginghams at Glasgow, stated the net wages of weavers in that department to be 4s. 6d. to 5s. a week ; and Mr. Thomas Davidson, a manufacturer of fancy lappet goods in that city, stated the wages of the plain weavers to be from 5s. to 5s. 6d. net on the average, and that the plain weavers were two- thirds or three-fourths of all the hand-loom weavers in Scotland, whilst the remaining one-third or one-fourth earned on an average boot 8s. a week. On the proceedings of the Committee on Hud- 76 ESSAY Off THE RATE OP WAGES. loom Weavers, it may be observed, that the selection of the wit- nesses, and the mode of examining them, show some disposition to make out a case ; and the most unfavourable view of the weavers' condition is presented."* Wages must depend upon production, and the fol- lowing statement will at once satisfy the reader, that low as are those received by the weavers, they are fully equal to their deserts as producers. " ' A very good hand weaver, 25 or 30 years of age, will weave two pieces of 9-8ths shirtings per week, each 24 yards long, con- taining 100 shoots of weft in an inch; the reed of the cloth being a 44 Bolton count, and the warp and weft 40 hanks to the Ib. " ' In 1833, a steam-loom weaver, from 15 to 20 years of age, assisted by a girl about 12 years of age, attending to four looms, can weave eighteen similar pieces in a week; some can weave twenty pieces.' "t In a description of the cotton goods made in Lan- cashire, at page 418 of Mr. Baines's work, it is stated, that the only goods that are the product of the power- loom exclusively, are stout printing calicoes. Stout calicoes for domestic purposes, as sheetings, coarse shirtings, &c., cotton shirtings, and small wares, are said to be chiefly the product of the power-loom. Cotton velvets, velveteens, &c., of power and hand- looms ; but all other articles, including common print- ing calicoes, are made at hand-looms. Hence it will be seen, that hand-looms continue to be used for the manufacture of the commonest arti- cles; and while such is the case while human labour undertakes to compete with machinery wages must necessarily be low. In the extract above given, it will be seen that two-thirds or three-fourths of the Baines, p. 486. t Ibid p. 240. ESSAY ESSAY Off THE RATE OP WAGES. trary effect must be produced, and wages must fall. The experience of the United States shows how much more rapidly capital may increase than population, when security of person and property are obtained at moderate cost of government, while that of Great Britain, the Netherlands, and France, shows that the tendency so to do, is too great to be prevented, even by the lavish expenditure of those nations. In Spain and Turkey, mis-government has been carried so far as to prevent it; but it is doubtful, if in any other part of Europe such is the case. With these exceptions, Europe, and certainly the United States and Canada, may be cited in proof of the as- sertion, that capital has a tendency to increase mare rapidly than population, and that it will do so, when not prevented by disturbing causes, the most import- ant of which are, First. Insecurity of person and property. Second. Heavy taxation. Third. Restrictions upon the freedom of action, or of trade. All tending to produce the Fourth. Want of industry. All of which it is proposed to consider, with refer- ence particularly to England, the United States, and Hindostan. In his Lectures on Wages, Mr. Senior adverts to two of the above disturbing causes, restraints upon commerce and difference of industry, but he does not notice the others, which are of the utmost importance. o2 ESSAY ON THE RATE OP WAGES. CHAPTER VIII. FIRST among these causes is insecurity of person or property, or both, as where these exist improve- ment can hardly be hoped for. The beneficial effect of security is well described by Mr. M'Culloch in the following passage, and he does not attach to it more importance than it merits. " The immediate cause of the rapid increase and vast amount of the commerce of Great Britain, is doubtless to be found in the ex- traordinary extension of our manufactures during the last half cen- tury. To inquire into the various circumstances that have contri- buted to the astonishing development of the powers and resources of industry that has been witnessed in this country since Arkwright and Watt began their memorable career, would be alike inconsistent with our object and limits. There can be no question, however, that freedom and security freedom to engage in every employment, and to pursue our own interest in our own way, coupled with an inti- mate conviction that acquisitions, when made, might be securely enjoyed or disposed of, have been the most copious sources of our wealth and power. There have only been two countries, Holland and the United States, which have, in these respects, been placed under nearly similar circumstances as England : and, notwithstand- ing the disadvantages of their situation, the Dutch have long been, and still continue to be, the most industrious and opulent people of the continent while the Americans, whose situation is more fa- vourable, are advancing in the career of improvement with a ra- pidity hitherto unknown. In Great Britain we have been exempted for a lengthened period from foreign aggression and intestine com- motion ; the pernicious influence of the feudal system has long been at an end; the same equal burdens have been laid on all classes; we have enjoyed the advantage of liberal institutions, without any ma- terial alloy of popular licentiousness or violence; our intercourse ESSAY ON THE RATE OF WAGES. with foreign states has, indeed, been subjected to many vexations and oppressive regulations; but full scope has been given taihe com- petition of the home producers; and, on the whole, the natural order of things has been less disturbed amongst us by artificial restraints, than in most other countries. But without security, no degree of freedom could have been of any material importance. Happily, however, every man has felt satisfied, not only of the temporary, but of the permanent tranquillity of the country, and the stability of its institutions. The plans and combinations of the capitalists have not been affected by any misgivings as to what might take place in future. " Moneyed fortunes have not been amassed, because they might be mere easily sent abroad in periods of confusion and disorder; but all individuals have unhesitatingly engaged, whenever an opportunity offered, in undertakings of which a remote posterity was alone to reap the benefit No one can look at the immense sums expended upon the permanent improvement of the land, on docks, warehouses, canals, &c., or reflect for a moment on the settlement of property in the funds, and the extent of our system of life insurance, without being impressed with a deep sense of the vast importance of that confidence which the public have placed in the security of property, and, consequently, in the endurance of the present order of things, and the good faith of government Had this confidence been im- perfect, industry and invention would have been paralyzed; and much of that capital, which clothes and feeds the industrious classes, would never have existed. The maintenance of this security entire, both in fact and in opinion, is essential to the public welfare. If it be anywise impaired, the colossal fabric of our prosperity will crumble into dust; and the commerce of London, like that of Car- thage, Palmyra, and Venice, will, at not a very remote period, be famous only in history. It is, therefore, of the utmost consequence, that in introducing the changes which the wants and -altered cir- cumstances of society require should be made in the frame of our polity, nothing be done to impair,- but every thing to strengthen, that confidence and security to which we are mainly indebted for the high and conspicuous place we have long occupied- among the nations of the oarth." In the United States equal security has existed. Their -Course has been peaceful, and they have known ESSAY ON THE RATE OF WAGES. nothing of the calamities of war since the peace of 1783, except for a short period, and even then it was confined to a very small portion of the country. Con- fiding in the protection of the laws, capitalists have invested their fortunes in mills and machinery ; in canals and rail roads. The most gigantic projects have been started ; many of them have been com- menced, and several completed. No enterprise seems too great, and capital is always to be found when it can be shown that the investment will be profitable. The capitalists of Europe, feeling the same confi- dence, make investments in the stocks of our canals, rail roads, and banks, thus aiding in giving employ- ment to the population, which ignorance of the true principles of political economy drives to our shores. In India, on the contrary, security of person or property has never been known. Since the Mahom- medan Conquest the country has at all times been desolated by the march of immense armies. At one time by the invading hosts of a Tamerlane; at others by those of a Baber or Nadir; at all times by the contending forces of opposite factions, always existing in a country where the succession to the throne is irregular, and its possession uncer- tain; and where it is constantly the object of conten- tion among fathers and children ; brothers and cou- sins ; sovereign and subject. The history of India is a long scene of horrors, marked only by the " in- cessant plunder and devastation of provinces : the perpetual marching and counter-marching of armies, and their lawless predatory habits." Nothing more fully illustrates the state of society, than the fact of ESSAY ON THE RATE OF WAGES. the existence in their language, of two such terms as " Wulsa" and " Joar," describing, in single words, scenes so unusual in other countries, that no term has been invented for them. The following account of them is fim Rickards's India.* ** Illustrations of the manners and immemorial habits of a people are sometimes unexpectedly derived from a careful attention to the elements or structure of their language. On the approach of a hos- tile army, the unfortunate inhabitants of India bury under ground their most cumbrous effects, and each individual, man, woman, and child above six years of age, (the infant children being carried by their mothers,) with a load rf grain proportioned to their strength, issue from their beloved homes, and take the direction of a country, (if such can be found,) exempt from the miseries of war: sometimes a strong fortress ; but more generally of the most unfrequented hills and woods, where they prolong a miserable existence, until the de- parture of the enemy ; and if this should be protracted beyond the time for which they had provided food, a large portion necessarily dies of hunger. The people of a district thus deserting their homes, are called the Wulsa of the district. A state of habitual misery, involving precautions against incessant war, and unpitying depre- dations of so peculiar a description, as to require in any of the lan- guages of Europe a circumlocution, is expressed in all the languages of the Deccan and the south of India, by a single word. u The second fact is, the shocking ceremony of the Joar, of which some instances have been above given. We have seen that the Hin- doos, when driven to despair by the Mussulman arms, were in the habit of sacrificing their own wives and children, by burning alive, or otherwise destroying them, to avoid the barbarities and pollutions they would have to endure, by falling into the hands of their con- querors. From facts like these it is to conceive how dreadful must have been the fate of the sufferers ; whilst the name or appellation it obtained throughout India, proves the cruelty to have been of no * India ; or ficta submitted to illustrate the Character and Con- dition of the Native Inhabitants. By R. Rickards, Esq. 2 vols. 8ro. London: 1832. ESSAY ON THE RATE OF WAGES. unfirequent occurrence. Even the horrors of the Inquisition in the west, are not to be compared with those of an eastern Joar. In the former, individuals only suffered, and generally under the consola- tory hope that their temporary pangs would be rewarded by a happy eternity; but in the latter, thousands at a time were sacrificed, and with no other feeling at the moment than the conviction that the sparing of their lives would only be to expose them to greater cruel- ties." The last century- was marked by the invasion of Nadir Shah, attended with an extraordinary destruc- tion of life and of property. Independently of all that Was destroyed, it was estimated that he carried with him into Persia, gold and silver and jewels to the almost incredible amount of thirty-two millions of pounds sterling. Shortly previous to that invasion, Sevajee had laid the foundation of the Mahratta power, which continued, during the whole of that century, and until its final overthrow by the Marquis of Hastings, to spread havoc and desolation through- out India. Some idea may be formed of the effect of the operations of such a body from the following: The characters of the Mahrattas throughout all these transac- tions, have been that of the most rapacious plunderers. Their pre- datory habits are quite proverbial, and their conquests were in a great measure effected by laying waste the countries through which they passed. When, therefore, it is considered, that in their first triumphs over the Moguls, they demanded and exacted, where they could, a chout, or fourth, of the revenues ; that they obtained from the Emperor, as before mentioned, a formal grant of this tribute, with power themselves to levy it on the disaffected provinces ; that is, the vice royalties which had shaken off the imperial authority ; the reade^ may judge of the state of misery and oppression to which the inhabitants of these devoted countries must have been reduced, who were thus subject to threefold plunder and extortion ; first, of ESSAY ON THE BATE OF WAGES. 87 the imperial armies from Delhi, who still continued to carry off Vast contributions from the DMfccan ; secondly, of their local Mussulman governors ; and thirdly, of their equally insatiate Mahratta invaders. The march of a Mahrttarmy is generally described as desolating the country through which it passes, on either aide of its route, which may thus easily be traced by ruined villages and destroyed cultivation. They plunder as they mo var along, seizing l>y violence or by treachery, on all that is valuable, o* any way conducive to their present security or ulterior views. Sevajee's depredations in this way were excessive ; so that *t his death his treasuries and arse- nals were stocked even to exuberance. Among other acts of the kind, he plundered the rich city of Surat three different times; on one of which occasions only, his booty was estimated at one million sterling. In his celebrated incursion into Drauveda, now called th Carnatic, he is said to have carried off vast wealth ; but the best proof, as well as the most characteristic trait of his unbounded and indiscriminate depredations is, that he was at length distinguished by the appellation of " The Robber," which was applied to him as an exclusive and appropriate title." Richards, Vol. i. 236. The Pindarees were another description of plun- derers, thus described : " It is a remarkable proof of the anarchy and tyranny long preva- lent in India, and of the deplorable statf of its inhabitants, that a power like that of the Pindarees should have grown into Mich for- midable dimensions in the very heart of the country; and spreading terror through all the neighbouring states, should require for its suppression one of the largest British armies that was ever called into the field. There are authentic records of the existence of Pin- darees, as a marauding body, for upwards of a century. * * Their ranks were constantly replenished with vagrants of all castes, and from every quarter of India; men driven from their homes by oppression, despair, or famine, to seek a precarious subsistence by plunder. * * * u Their incursions into the British territories were so frequent, and their devastations so extensive, as to require a military force to be annually employed against them. Their progress wa generally marked by smoking ruins, and the most inhuman barbarities to pei- sons of both sexes. ESSAY Off THE RATE OF WAGES. " Marquis Hastings observes of the Pindarees, ' Whto it is rc collected that the asso