An Introduction to the Industrial and Social History of England

by Edward Potts Cheyney

Thus the structure of regulation of industry, which had been built up in the sixteenth and seventeenth centuries, or which had survived from the Middle Ages, was now torn down; the use of the powers of government to make men carry on their economic life in a certain way, to buy and sell, labor and hire, manufacture and cultivate, export and import, only in such ways as were thought to be best for the nation, seemed to be entirely abandoned. The laissez-faire view of government was to all appearances becoming entirely dominant.

63. Individualism.—But the prevailing tendencies of thought and the economic teaching of the period were not merely negative and opposed to government regulation; they contained a positive element also. If there was to be no external control, what incentive would actuate men in their industrial existence? What force would hold economic society together? The answer was a plain one. Enlightened self-interest was the incentive, universal free competition was the force. James Anderson, in his Political Economy, published in 1801, says, "Private interest is the great source of public good, which, though operating unseen, never ceases one moment to act with unabating power, if it be not perverted by the futile regulations of some short-sighted politician." Again, Malthus, in his Essay on Population, in 1817, says: "By making the passion of self-love beyond comparison stronger than the passion of benevolence, the more ignorant are led to pursue the general happiness, an end which they would have totally failed to attain if the moving principle of their conduct had been benevolence. Benevolence, indeed, as the great and constant source of action, would require the most perfect knowledge of causes and effects, and therefore can only be the attribute of the Deity. In a being so short-sighted as man it would lead to the grossest errors, and soon transform the fair and cultivated soil of human society into a dreary scene of want and confusion."

In other words, a natural and sufficient economic force was always tending to act and to produce the best results, except in as far as it was interfered with by external regulation. If a man wishes to earn wages, to receive payment, he must observe what work another man wants done, or what goods another man desires, and offer to do that work or furnish those goods, so that the other man may be willing to remunerate him. In this way both obtain what they want, and if all others are similarly occupied all wants will be satisfied so far as practicable. But men must be entirely free to act as they think best, to choose what and when and how they will produce. The best results will be obtained where the greatest freedom exists, where men may compete with one another freed from all trammels, at liberty to pay or ask such wages, to demand or offer such prices, to accept or reject such goods, as they wish or can agree upon. If everybody else is equally free the man who offers the best to his neighbor will be preferred. Effort will thus be stimulated, self-reliance encouraged, production increased, improvement attained, and economy guaranteed. Nor should there be any special favor or encouragement given by government or by any other bodies to any special individuals or classes of persons or kinds of industry, for in this way capital and labor will be diverted from the direction which they would naturally take, and the self-reliance and energy of such favored persons diminished.

Therefore complete individualism, universal freedom of competition, was the ideal of the age, as far as there is ever any universal ideal. There certainly was a general belief among the greater number of the intelligent and influential classes, that when each person was freely seeking his own best interest he was doing the best for himself and for all. Economic society was conceived of as a number of freely competing units held in equilibrium by the force of competition, much as the material universe is held together by the attraction of gravitation. Any hindrance to this freedom of the individual to compete freely with all others, any artificial support or encouragement that gives him an advantage over others, is against his own real interest and that of society.

This ideal was necessarily as much opposed to voluntary combinations, and to restrictions imposed by custom or agreement, as it was to government regulation. Individualism is much more than a mere laissez-faire policy of government. It believes that every man should remain and be allowed to remain free, unrestricted, undirected, unassisted, so that he may be in a position at any time to direct his labor, ability, capital, enterprise, in any direction that may seem to him most desirable, and may be induced to put forth his best efforts to attain success. The arguments on which it was based were drawn from the domain of men's natural right to economic as to other freedom; from experience, by which it was believed that all regulation had proved to be injurious; and from economic doctrine, which was believed to have discovered natural laws that proved the necessary result of interference to be evil, or at best futile.

The changes of the time were favorable to this ideal. Men had never been so free from external control by government or any other power. The completion of the process of enclosure left every agriculturist at liberty to plant and raise what he chose, and when and how he chose. The reform of the poor law in 1834 abolished the act of settlement of 1662, by which the authorities of each parish had the power to remove to the place from which they came any laborers who entered it, and so far as the law was concerned, farm laborers were now free to come and go where they chose to seek for work. In the new factories, systems of transportation, and other large establishments that were taking the places of small ones, employees were at liberty to leave their engagements at any time they chose, to go to another employer or another occupation; and the employer had the same liberty of discharging at a moment's notice. Manufacturers were at liberty to make anything they chose, and hire laborers in whatever proportion they chose. And just as early modern regulation had been given up, so the few fragments of mediæval restrictive institutions that had survived the intervening centuries were now rapidly abandoned in the stress of competitive society. Later forms of restriction, such as trade unions and trusts, had not yet grown up. Actual conditions and the theoretical statement of what was desirable approximated to one another more nearly than they usually have in the world's history.

64. Social Conditions at the Beginning of the Nineteenth Century.—Yet somehow the results were disappointing. More and better manufactured goods were produced and foreign goods sold, and at vastly lower prices. The same result would probably have been true in agriculture had not the corn laws long prevented this consummation, and instead distributed the surplus to paupers and the holders of government bonds through the medium of taxes. There was no doubt of English wealth and progress. England held the primacy of the world in commerce, in manufactures, in agriculture. Her rapid increase in wealth had enabled her to bear the burden, not only of her own part in the Napoleonic wars, but of much of the expense of the armament of the continental countries. Population also was increasing more rapidly than ever before. She stood before the world as the most prominent and successful modern nation in all material respects. Yet a closer examination into her internal condition shows much that was deeply unsatisfactory. The period of transition from the domestic to the factory system of industry and from the older to the new farming conditions was one of almost unrelieved misery to great masses of those who were wedded to the old ways, who had neither the capital, the enterprise, nor the physical nor mental adaptability to attach themselves to the new. The hand-loom weavers kept up a hopeless struggle in the garrets and cellars of the factory towns, while their wages were sinking lower and lower till finally the whole generation died out. The small farmers who lost the support of spinning and other by-industries succumbed in the competition with the larger producers. The cottagers whose commons were lost to them by enclosures frequently failed to find a niche for themselves in their own part of the country, and became paupers or vagabonds. Many of the same sad incidents which marked the sixteenth century were characteristic of this period of analogous change, when ultimate improvement was being bought at the price of much immediate misery.

Carding, Drawing, and Roving in 1835.
(Baines: History of Cotton Manufacture.)