Principles of Political Economy

by Arthur Latham Perry

(a) The only possible and practicable remedy for this state of things, so far as the employers are concerned, is in a more conservative attitude of capitalists as a class about passing over their resources to the hands of men who have not proven their ability to handle them wisely by a full course of training in the management of practical affairs. By a wretched policy in this country at present Capital is prohibited from building and from buying ships, with which to navigate the oceans; from selling domestic manufactures in foreign markets; and also from a profitable agriculture, which may sell its products abroad and take its pay back. Consequently Capital, eager in its own nature to be invested to a profit somehow somewhere, has rushed without due circumspection into the hands of domestic operators, who have not been half fitted for their task, who have knitted relations with laborers without being able to secure their permanent respect or to control their services, and who have lost to their owners in multitudes of cases the entire capital intrusted to them. If capitalists had had during the last quarter of a century one-half of their natural and proper chance to invest their money to a profit, there would not have been such a reckless investment through incompetent hands in building mills and foundries in this interval of time, and such wholesale losses in connection with them. When capital comes to be at liberty to turn right or left according to its own will in view of a prospective profit, factory companies and projectors cannot draw resources from the public for their operations, without demonstrating to the owners the trained and tried capacity of the practical operators, who will buy the materials and hire the laborers and market the products.

(b) The practical remedy for the inexperience and instability and unskilfulness of laborers as tending towards labor-troubles of all kinds and degrees, is only to be found in a want of market for such services. In a natural and wholesome state of things, such as would exist in the United States were it not for national laws tampering with Trade and with Money, the questions asked an applicant for skilled work by any labor-taker would be, "What have you learned to do? How long and for what pay do you want to do it? What do you want to reach next, when the present job is done?" When employment turns on good answers to such questions as these, and when the questions themselves are put in good faith, there will be an end of Strikes and Lockouts. Untrained and restless hands will get nothing to do in mills and factories. Apprenticeship in its various forms will come back into vogue, and will probably be made a part of the course in public schools. The division and gradation of laborers will be carried out further than it ever yet has been. Laborers will then be organized in the best sense of that word, and to the best advantage of capitalists. The permanent Supply of skilled laborers will be constantly adjusting itself to a permanent and increasing Demand for them. And it requires no millennium for such a state of things to come in. It requires nothing but an ordinary and enlightened and beneficent selfishness on the part of capitalists to adjust itself to the ordinary selfishness of laborers sure to become enlightened and beneficent to the best and ever-growing interests of both parties. This is not the spoken word of Morality, still less is it the divine word of Religion, it is only the common programme of a common-sense Political Economy.

(3) The third and last general cause of misunderstandings and embittered disputes as between laborers and capitalists is partly economical and partly moral, and consequently the remedy for it is partly moral and partly economical. The Past projects itself down into the Present partly with blessings and partly with curses. In the old times under Slavery and Feudalism the laborer always came forward to his task with a taint upon him. Sometimes the taint attached to his birth, and at all times it attached to his calling. Slavery in all its forms always makes manual labor degrading. The courtly Cicero apologizes in a letter to his friend for his open sorrow over the death of his favorite slave; and in several passages of his treatise on Morals he follows his Greek teachers, Plato and Aristotle, and declaims in a pitiful way against the noble rights of laborers. "All artisans are engaged in a degrading profession." Again, "there can be nothing ingenuous in a workshop." When trade and commerce are carried on on a small scale, "they are to be regarded as disgraceful"; when on a large scale, "they must not be greatly condemned—non admodum vituperanda!" (I, 42.)

Serfdom once existed in England, and threw its shade over free laborers there long after itself had disappeared. A class of indented servants pervaded all the New England Colonies, and a clause of the New England Confederation of 1643 provided for their forced rendition from Colony to Colony, and passed over almost verbally into the Constitution of the United States of 1787 as applicable to the slaves of the South. In this way in all parts of this country manual laborers came to be more or less off color, and this has continued in a continually lessened degree till this time. When those who work with their hands are looked down upon by those who do not, two sets of feelings are apt to be engendered equally unfortunate to the two classes that entertain them. The non-manual workers, the employers, are more or less puffed up with pride and a sense of superiority (there are beautiful exceptions) as towards their laborers, and the latter in their turn are apt to develop alongside an unmanly servility and an apparent deference, a sort of secret breasting up of hostility and defiance, which is sure to manifest itself when labor troubles come on even when it has not helped to brood these troubles into life. The parties then are not well placed as towards each other to negotiate and to compromise and to coalesce in a future harmony. The party of the first part is too proud to yield to their inferiors, and the party of the second part is too bitter to be sweetened. Who is sufficient for these things? And what is the remedy for them?

(a) So far as employers are concerned, their natural though unreasonable and provoking arrogance may well be reduced by the economical reflection, that the laborers are exactly as necessary to production as the capitalists are, that the two stand on a precise level so far as the product goes, that each is one blade of the shears and the other the other and that it takes both blades to cut anything, that while the laborers are sellers in the open market the capitalists are likewise sellers and that the same ultimate purchaser furnishes the market for both sets of sellers, that as sellers they are only equal in position, that buying and selling is a levelling as well as an uplifting process the world over, and that as such co-equal partners in one indivisible operation all haughtiness on one side and all undue humility on the other is nothing but obstacle as towards the common end; and also by the moral and social reflection, that their laborers are just such men as themselves in motive and action, that the two are very likely to exchange places with each other before very long, that riches are extremely liable to take to themselves wings and fly away, that Christianity is no respecter of persons, that humanity deems nothing human alien from itself, that morality puts the golden rule upon the fore-front of its precepts, and that whatever may unite any body of men in a legitimate purpose of achievement along any line of human action multiplies the power of each individual and exalts his standing and responsibility as such individual and thus reduplicates the reward of his individual action.

(b) So far as the employees are concerned, in any temporary sense of dependence or even of injustice, there is open to them the economical reflection (and it will do them good to bring it home) that their best route to the respect and favor and feeling of equality of their employers is through the excellence of the service they render them and the courtesy (not servility) with which they render it, that as every capitalist becomes such by means of abstinence they may themselves by saving become capitalists, that there is nothing in the nature of their work or its relations to capital to cause them to hang down their heads, that handsome is that handsome does, that the opportune offer of the present capital to work on gives them a chance to exhibit their skill and to earn a living, that the capitalists are just as dependent on them as they upon those, and that as single sellers of a valuable personal service they daily confront on a footing of equality the sellers of a valuable product so created; and there is open to them also the moral and social reflection fortified by constant observation and experience, that no matter where a man begins it is the end that crowns his work, that life to all is a series of stepping-stones, that manly qualities are appreciated everywhere, that character tells in the lowest position however high and low are reckoned, that the poor gain and hold friends quite as well as the rich, that there was a certain poor wise man that saved the city by his wisdom and gained a lasting record in consequence, that the poor and the rich are constantly changing places in this world, and that there is no respect of persons with God.

We may see now what we are to think of some popular remedies constantly recommended for low Wages. A brief discussion of what is false will give us a stronger hold of what is true. The chapter will close with relevant reference to three current remedies.

1. It is being dinned into the ears of the present generation, that Government has large functions in the ongoings of business, that it ought sometimes to interfere to better the rate of Wages, at least to designate a minimum below which they shall not go, and that Government should hold itself ready to undertake directly to carry on certain branches of business under certain circumstances. This scheme goes under the high-sounding name of Nationalism. Richard T. Ely, Professor of Political Economy in Johns Hopkins University, is one of the most prominent representatives at present of this school of thought. In his Introduction to Political Economy just published (1889), he lays down this principle: "When for any class of business it becomes necessary to abandon the principle of freedom in the establishment of enterprises, this business should be entirely turned over to Government, either local, state, or federal, according to the nature of the undertaking." He begins his book by attempting to hammer in the "lesson" that as Civilization improves, coöperation takes the place of individualism. The golden age of individualism, he says, is among the wild tribes of Australia. They never coöperate with each other in their economic efforts, or in anything else. No one expects anything from his neighbor, and every one does unto others as he thinks they would do to him. The life there is one prolonged scene of selfishness and fear. But as civilization comes in, he says, individualism goes out, and coöperation takes its place. The fine old Bentham principle of laissez faire, which most English thinkers for a century past have regarded as established forever in the nature of man and in God's plans of providence and government, is gently tossed by Dr. Ely into the wilds of Australian barbarism.

There are some propositions that are certainly true, and one of them is, that no man can write like that, who ever analyzed into their elements either Economics or Politics, who ever gained a clear conception of the sphere of either science in its relation to the other, or who ever saw distinctly the relations of either to the nature of Man. The sole motive in Buying and Selling is the gain of the individual, each for and by himself. That always was the motive, is now, and always will be. No complications of modern business, no complexities of credit, no combinations of capitalists or laborers, ever altered or ever can alter one particle the motives of men in buying and selling. In a natural and progressive state of things, Individualism, instead of going out, comes more and more into play, through the Division of Labor and the falling of all sorts of services more and more into specialties. To talk glibly, as Professor Ely does, about Government taking up easily and carrying on in a better way and to better ends branches of pure business as they are dropped or forced from the hands of Individuals, is ignorance at once and alike of the real nature of Government and of Business. Let us look at a few of the native incongruities and logical fallacies of this nationalistic position.

(1) What is human Government? Is there anything substantive and continuous in its personnel and purposes, as there is in the government of God? Is government anything more, can it be anything more, than a transient Committee of the citizens charged and changed to do in certain few particulars the changing will of a Majority? Government is indeed a necessity, as men are, to restrain the lawless, and to shape the ends of the law-abiding; but it has to be administered, if at all, by precisely the same kind of men as the rest are, chosen for brief periods, their duties sharply prescribed by constitution or custom, and impeachments or other punishments provided for them when they transgress. One President of the United States and one Judge of its Supreme Court have already been solemnly impeached by the sovereign people themselves.