◆¹ My present aim, however, is to make no exact calculation respecting the extent to which production, taken as a whole, had during the period in question outstripped the increase of Labour; but merely to show the reader that the extent was very large; and that, according to the principles explained already, it was due altogether to the operation of Capital and Ability—or, to speak more exactly, of Ability operating through Capital. The truth of this statement with regard to the increase of manufactures has been shown and illustrated by the instance of Arkwright and the cotton industry. It will be well to mention at this point several analogous instances taken from the history of agriculture. ◆² Elkington, who inaugurated a new system of drainage, will supply us with one. One still more remarkable is supplied by Bakewell, who may be said to have played in practical life a part resembling that which Darwin has played in speculation. He discovered the method of improving the breeds of sheep and cattle by a system of selection and crossing that was not before known; and it was owing to the ability of this one man that “the breed of animals in England,” as Mr. Lecky points out, “was probably more improved in the course of a single fifty years than in all the recorded centuries that preceded it.” The close connection of such improvements with Capital is the constant theme of Arthur Young, though he was not consciously anything of a political economist, nor did he attempt to express his opinion in scientific language. But a still more effective witness is a distinguished modern Radical, Professor Thorold Rogers, who, though always ready, and, as many people would say, eager to espouse the side of Labour as against Capital and Ability,—especially when the two last belonged to the landed class—is yet compelled to assert as emphatically as Young himself, that the Ability and the Capital of this very class were in the last century “the pioneers of agricultural progress”—a progress which he illustrates by these picturesque examples: that it raised the average weight of the fatted ox from 400 lbs. to 1200 lbs., and increased the weight of the average fleece fourfold.

◆1 Therefore it is plain that Labour would not have created the whole of the national income a hundred years ago. But for argument’s sake we will concede that it produced the whole.

◆¹ It will therefore be apparent to every reader, that of the income of Great Britain at the close of the last century, Ability and Capital, as distinct from Labour, created a considerable part, though we need not determine what part. Accordingly, since the income of Great Britain, with a population of ten millions, was at that time about a hundred and forty million pounds, or fourteen pounds per head,[37] it is evident that the Labour of a population of ten millions was quite incapable, a hundred years ago, of producing by itself as much as fourteen pounds per head.[38] I will, however, merely for the sake of argument, and of keeping a calculation I am about to make far within the limits which strict truth would warrant, make a preposterous concession to any possible objector. I will concede that Labour by itself produced the entire value in question, and that Ability, as distinct from Labour, had nothing at all to do with it. I will concede that the faculties which produced the machines of Arkwright, which had already turned steam into an infant Hercules of industry, and was pouring into this island the wealth of the farthest Indies, were faculties of the same order as those which were possessed by any waggoner who had driven the same waggon along the same ruts for a lifetime. And I will now proceed to the calculation I spoke of. I shall state it first, and establish its truth afterwards.

◆1 The whole income of Great Britain at that time was a hundred and forty million pounds, and the population ten millions. Hence, as will be shown in the next Book, we get an indication of the utmost that Labour alone can produce. Now, a population of ten millions at present produces three hundred and fifty millions annually.

◆¹ It will be seen, from what has just been said, that a hundred years ago the utmost that Labour could produce in the most advanced country of Europe was a hundred and forty million pounds annually for a population of ten millions, or—let me repeat—fourteen pounds per head. The production per head is now thirty-five pounds; or, for each ten millions of population, three hundred and fifty millions. The point on which presently I shall insist at length is this: that if Labour is to be credited with producing the whole of the smaller sum, the entire difference between the smaller sum and the larger is to be credited to Ability operating on industry through Capital. That is to say, for every three hundred and fifty millions of our present national income, Labour produces only a hundred and forty millions whilst Ability and Capital produce two hundred and ten. But the fact may be put yet more clearly than this. Of our present national income of thirteen hundred millions, Labour produces about five hundred, whilst Ability and Capital produce about eight hundred. It could indeed be shown, as I just now indicated, that Labour in reality produces less than this, and Ability and Capital more; but for argument’s sake we will let the calculation stand thus, in order that Labour shall be at all events credited with not less than its due.

◆1 And it will accordingly be shown in the next Book that the whole of this increment is produced by Ability, and not by Labour.

◆¹ And now as to Capital and Ability, and the eight hundred millions produced by them, what has just been said can be put in a simpler way. Capital is not only the material means through which Ability acts on and assists Labour, but it is a material means which Ability has itself created. So long as Labour alone was the principal productive agent, those vast accumulations which are distinctive of the modern world were unknown and impossible. Professor Thorold Rogers has pointed out how small was the Capital of this country at so late a date as the close of the seventeenth century. Labour alone was unable to supply a surplus from which any such accumulation as we now call Capital could be taken. These became possible only by the increasing action of Ability. They were taken from the products which Ability added to the products of Labour, Capital therefore is Ability in a double sense—not only in the sense that as a productive agent it represents Ability, but in the sense that Ability has created it. We may therefore for the present leave Capital entirely out of our discussion, regarding it as comprehended under the term and the idea of Ability; although when we come to consider the question of distribution, we shall have to take account of the distinction between the two. But for the present we are concerned with the problem of production only; and in dealing with that part of it which alone is now before us, we have to do only with two, and not three forces—not with Labour, Ability, and Capital, but with Labour and Ability only.

The calculation, therefore, which was put forward just now may be expressed in yet simpler terms. Of our present national income of thirteen hundred millions, Labour produces five hundred millions and Ability eight hundred. And now comes another point which yet remains to be mentioned. When we speak of Labour, we mean not an abstract quality: what we mean is labouring men. Similarly, when we talk of Ability, we do not mean an abstract quality either: we mean men who possess and exercise it. But whereas when we talk of Labour we mean an immense number of men, when we talk of Ability—as I shall show presently—we mean a number that by comparison is extremely small. The real fact then on which I am here insisting, and which I shall now proceed to substantiate and explain further, is that, whilst the immense majority of the population of this country produce little more than one-third of the income, a body of men who are comparatively a mere handful actually produce little less than two-thirds of it.

BOOK III

AN EXPOSURE OF THE CONFUSIONS IMPLIED IN SOCIALISTIC THOUGHT AS TO THE MAIN AGENT IN MODERN PRODUCTION