Non-Marxian Socialism

   Left Ricardians  

Thomas Hodgskin
1787 - 1869


LINKS: X X X

Labour Defended Against the Claims of Capital
1825

(excerpts)

NOTE

…all the benefits attributed to capital arise from co-existing and skilled labour. ….[ I ] deny that capital has any just claim to the large share of the national produce now bestowed on it. ..This large share he has endeavored to show is the cause of the poverty of the labourer; …

I

…at present there exists a serious contest between capital and labour. The journeymen of almost every trade have combined to obtain higher wages, and their employers have appealed to the legislature for protection. …

The press … by far the greater and more influential part of it is engaged on the side of the capitalist. … To suggest some arguments in favour of labour against capital, is my chief motive for publishing the present pamphlet.

By our increased skill and knowledge, labour is now probably ten times more productive than it was two hundred years ago; and we are, forsooth, to be contended with the same rewards which the bondsmen then received. All the advantages of our improvements go to the capitalist and the landlord. When, denied any share in our increased produce, we combine to obtain it, we are instantly threatened with summary punishment. New laws are fulminated against us, and if these are found insufficient we are threatened with laws still more severe.

Combination is of itself no crime; on the contrary, it is the principle on which societies are held together. ….

It is a heinous crime in the eyes of a legislature, composed exclusively of capitalists and landlords, … They have made also a law handing us over to the magistrates like vagabonds and thieves, and we are to be condemned almost unheard, and without the privilege and formality of a public trial. …all that we have had inflicted on us, has been done for the advantage of capital.

II

….. Wages vary inversely as profits; or wages rise when profits fall, and profits rise when wages fall; and it is therefore profits, or the capitalist's share of the national produce, which is opposed to wages, or the share of the labourer. …

… to show the hollowness of the theory on which the claims of capital, and on which all the oppressive laws made for its protection are founded. ….

"The produce of the earth," says Mr Ricardo -- "All that is derived from its surface by the united application of labour, machinery and capital is divided among three classes of the community; namely, the proprietor of the land, the owner of the stock or capital necessary for its cultivation, and the labourers by whose industry it is cultivated." (Principles of Political Economy, Preface, p. 1, 2nd Ed.)

"It is self-evident," says Mr M'Culloch, "that only three classes, the labourers, the possessors of capital, and the proprietors of land, are ever directly concerned in the production of commodities. It is to them, therefore, that all which is derived from the surface of the earth, or from its bowels, by the united application of immediate labour, and of capital, or accumulated labour, must primarily belong. The other classes of society have no revenue except what they derive either voluntarily or by compulsion from these three classes."

The proportions in which the whole produce is divided among these three classes is said to be as follows: -- "Land is of different degrees of fertility." "When, in the progress of society, land of the second quality (or an inferior degree of fertility to land before cultivated) is taken into cultivation, rent immediately commences on that of the first quality, and the amount of that rent will depend on the difference in the quality, and the amount of that rent will depend on the difference in the quality of these two portions or land." [Principles of Political Economy]

Rent, therefore, … is the …produce of all the land which is more fertile than the least fertile land cultivated. To produce this surplus would not break the back, and to give it up would not break the heart of the labourer. The landlord's share, therefore, does not keep the labourer poor.

The labourer's share of the produce of a country, according to this theory, is the "necessaries and conveniences required for the support of the labourer and his family; or that quantity which is necessary to enable the labourers, one with another, to subsist and to perpetuate their race, without either increase or diminution."

Whatever may be the truth of the theory in other respects, there is no doubt of its correctness in this particular. The labourers do only receive, and ever have only received, as much as will subsist them, the landlords receive the surplus produce of the more fertile soils, and all the rest of the whole produce of labour in this and in every country goes to the capitalist under the name of profit for the use of his capital.

Capital …[is] "the produce of labour…

Capital, the reader will suppose, must have some wonderful properties, when the labourer pays so exorbitantly for it. …

Several good and great men, …, seeing that capital did obtain all the large share I have mentioned… have endeavoured to point out the method in which capital aids production…

Mr M'Culloch says: "The accumulation and employment of both fixed and circulating capital is indispensably necessary to elevate any nation in the scale of civilization. And it is only by their conjoined and powerful operation that wealth can be largely produced and universally diffused." [Article "Political Economy" in Supplement to Encyclopedia Britannica.]

"The quantity of industry," he further says, "therefore not only increases in every country with the increase of the stock or capital which sets it in motion; but, in consequence of this increase, the division of labour becomes extended, new and more powerful implements and machines are invented, and the same quantity of labour is thus made to produce an infinitely greater quantity of commodities.

"Besides its effect in enabling labour to be divided, capital contributes to facilitate labour, and produce wealth in the three following ways:-- "First. -- It enables us to execute work that could not be executed, or to produce commodities that could not be produced without it. "Second. -- It saves labour in the production of almost every species of commodities. "Third. -- It enables us to execute work better, as well as more expeditiously."

Mr Mill's account of these effects, though not so precise, is still more astounding. "The labourer," he says, "has neither raw materials nor tools. These are provided for him by the capitalist. For making this provision the capitalist of course expects a reward." ….

He also attributes to capital power of accumulation. …

III

Mr M'Culloch says, "without circulating capital," meaning the food the labourer consumes, and the clothing he wears, "the labourer never could engage in any undertaking which did not yield an almost immediate return." Afterwards he says, "that division of labour is a consequence of previous accumulation of capital…

The only advantage of circulating capital is that by it the labourer is enabled, he being assured of his present subsistence, to direct his power to the greatest advantage. He has time to learn an art, and his labour is rendered more productive when directed by skill. Being assured of immediate subsistence, he can ascertain which, with his peculiar knowledge and acquirements, and with reference to the wants of society, is the best method of labouring, and he can labour in this manner.

Unless there were this assurance there could be no continuous thought, no invention, and no knowledge but that which would be necessary for the supply of our immediate animal wants…. It is this assurance, this knowledge, this confidence of obtaining subsistence and reward, which enables and induces men to undertake long and complicated operations, and the question is, do men derive this assurance from a stock of goods already provided (saved from the produce of previous labour) and ready to pay them, or from any other source?

I SHALL ENDEAVOUR TO SHOW THAT THIS ASSURANCE ARISES FROM A GENERAL PRINCIPLE IN THE CONSTITUTION OF MAN, AND THAT THE EFFECTS ATTRIBUTED TO A STOCK OF COMMODITIES, UNDER THE NAME OF CIRCULATING CAPITAL, ARE CAUSED BY CO-EXISTING LABOUR.

The labourer, the real maker of any commodity, derives this assurance from a knowledge he has that the person who set him to work will pay him, and that with the money he will be able to buy what he requires. He is not in possession of any stock of commodities.

Has the person who employs and pays him such a stock?

Clearly not. …. He possesses money, he possesses credit with other capitalists, he possesses, under the sanction of the law, a power over the labour of the slave-descended labourer, but he does not possess food or clothing. He pays the labourer his money wages, and the expectation which other labourers have of receiving part of these wages or other wages, induces them in the meantime to prepare the clothing and food the labourer constantly requires….

 

Do all the capitalists of Europe possess at this moment one week's food and clothing for all the labourers they employ?

The labourer knows that when he is able to pay for bread, for meat and for drink he can procure them, but he knows nothing further; and I have shown that these are not prepared till he needs them. …

To enable either the master manufacturer or the labourer to devote himself to any particular occupation, it is only necessary that he should possess -- not, as political economists say, a stock of commodities, or circulating capital, but a conviction that while he is labouring at his particular occupation the things which he does not produce himself will be provided for him, and that he will be able to procure them and pay for them by the produce of his own labour.

This conviction arises, in the first instance, without any reflection from habit…

It is labour which produces all things as they are wanted, and the only thing which can be said to be stored up or previously prepared is the skill of the labourer. …

All classes of men carry on their daily toils in the full confidence that while each is engaged in his particular occupation some others will prepare whatever he requires, both for his immediate and future consumption and use.

I have already explained that this confidence arises from that law of our nature by which we securely expect the sun will rise tomorrow, …there is no knowledge of any produce of previous labour stored up for use, that the effects usually attributed to a stock of commodities are caused by co-existing labour, and that it is by the command the capitalist possesses over the labour of some men, not by his possessing a stock of commodities, that he is enabled to support and consequently employ other labourers.

IV

I come now to examine, secondly, the nature and effects of fixed capital. Fixed capital consists of the tools and instruments the labourer works with, the machinery he makes and guides, and the buildings he uses either to facilitate his exertions or to protect their produce.

Unquestionably by using these instruments man adds wonderfully to his power…

Every man must admit that by means of instruments and machines the labourer can execute tasks he could not possibly perform without them; that he can perform a greater quantity of work in a given time, and that he can perform the work with greater nicety and accuracy than he could possibly do had he no instruments and machines. But the question then occurs, what produces instruments and machines, and in what degree do they aid production independent of the labourer, so that the owners of them are entitled to by far the greater part of the whole produce of the country?

Are they, or are they not, the produce of labour?

Do they, or do they not, constitute an efficient means of production, separate from labour?

Are they, or are they not, so much inert decaying and dead matter, of no utility whatever, possessing no productive power whatever, but as they are guided, directed and applied by skilful hands? …

It is admitted by those who contend most strenuously for the claims of capital that all instruments and machines are the produce of labour. They add, however, that they are the produce of previous labour, and are entitled to profit, on account of having been saved or stored up.

But the manufacture of instruments and tools is quite as uninterrupted as the manufacture of food and clothing. They are not all consumed or used within a year, but they are brought into use as soon as possible after they are made. Nobody who manufactures them stores them up; nor does he make them for this purpose. As long as they are merely the result of previous labour, and are not applied to their respective uses by labourers, they do not repay the expense of making them.

It is plainly not the previous creation of these things which entitles them to profit, for most of them diminish in value from being kept. … Fixed capital does not derive its utility from previous, but present labour; and does not bring its owner a profit because it has been stored up, but because it is a means of obtaining a command over labour.….

All fixed capital, not only in the first instance, as is generally admitted, but in every stage of society, at every period in the history of man, is the creation of labour and of skill, of different species of labour and skill certainly, but of nothing more than labour and skill. …

To have and to use this fixed capital, knowledge, labour and skill are necessary. Without these it could not be made, and when it would be less productive than the clod from which its materials spring, or from which they are fashioned by the hand of man.

…There was time in society when capital and capitalists were of the most essential service to it. On the establishment of towns in Europe, and on the introduction of manufactures into them, they became the refuge of all the oppressed and enslaved peasantry who could escape from their feudal tyrants. The capitalists and manufacturers who inhabited them were the skilled labourers, and really gave employment and protection to the peasantry. They taught them useful arts, and hence became invested with the character of benefactors, both to the poor and the state.

They were infinitely better than the feudal barons with whom they were compared; and the character they then acquired they now retain. The veneration men have for capital and capitalists is founded on a sort of superstitious and transmitted notion of their utility in former times.

But they have long since reduced the ancient tyrant of the soil to comparative insignificance, while they have inherited his power over all the labouring classes. It is, therefore, now time that the reproaches so long cast on the feudal aristocracy should be heaped on capital and capitalists; or on that still more oppressive aristocracy which is founded on wealth, and which is nourished by profit.  

V

…. It is usually stated that "the productive industry of any country is in proportion to its capital, increases when its capital increases, and declines when its capital declines."

This position is true only of circulating capital, but not of fixed capital. The number of productive labourers depends certainly on the quantity of food, clothing, etc., produced and appropriated to their use; it is not, however, the quantity but the quality of the fixed capital on which the productive industry of a country depends.

Instruments are productive, to use the improper language of the political economists, not in proportion as they multiplied, but as they are efficient. …

Although, therefore, the number of labourers must at all times depend on the quantity of circulating capital, or, as I should say, on the quantity of the products of co-existing labour, which labourers are allowed to consume, the quality of commodities they produce will depend on the efficiency of their fixed capital. ….

Betwixt him who produces food and him who produces clothing, betwixt him who makes instruments and him who uses them, in steps the capitalist, who neither makes nor uses them, and appropriates to himself the produce of both. With as niggard a hand as possible he transfers to each a part of the produce of the other, keeping to himself the large share. …

He is the middleman of all labourers; and when we compare what the skilled labour of England produces, with the produce of the untutored labour of the Irish peasantry, the middlemen of England cannot be considered as inferior in their exactions to the middlemen of Ireland. They have been more fortunate, however, and while the latter are stigmatised as oppressors, the former are honoured as benefactors.

Not only do they appropriate the produce of the labourer; but they have succeeded in persuading him that they are his benefactors and employers. At least such are the doctrines of political economy; and capitalists may well be pleased with a science which both justifies their claims and holds them up to our admiration, as the great means of civilising and improving the world.

… I must observe that all political economists agree in saying that all savings in society are usually made by capitalists. The labourer cannot save; the landlord is not disposed to save; whatever is saved is saved from profits and becomes the property of the capitalists.

Now let us suppose that a capitalist possesses, when profit is at ten per cent per annum, 100 quarters of wheat and 100 steam engines; he must at the end of a year be paid for allowing the labourer to eat this wheat and use these steam engines with 110 quarters of wheat and 110 steam engines, ….

Let us suppose that 5 quarters of wheat and 5 steam engines, or the value of this quantity, suffices for the owner's consumption, and that the other 5 of his profit being added to this capital he has the next year 105 quarters of wheat and 105 steam engines, which he allows labourers to eat or use; for these the labourer must produce for him, the following year, …115 quarters 4 bushels of wheat and 155 ½ steam engines. ….

… Dr Price has calculated that the sum of one penny put out to compound interest at our Saviour's birth, at 5 per cent, would in the year 1791 amount to a sum greater than could be contained in three hundred millions of globes like this earth, all solid gold. …

The political economists either say, with Adam Smith, that the accumulation of capital lowers profits, or, with Mr Ricardo, that profits are lowered by the increasing difficulty of procuring subsistence. Neither of them has assigned it to the right cause, the impossibility of the labourer answering the demands of the capitalist. …

It is clear, however, that no labour, no productive power, no ingenuity and no art can answer the overwhelming demands of compound interest. But all saving is made from the revenue of the capitalist, so that actually these demands are constantly made, and as constantly the productive power of labour refuse to satisfy them…

VI

It has indeed been said by some sapient legislators, both Lords and Commoners, that the journeymen will do themselves incalculable mischief by driving capital out of the country; and one of the reasons urged for the new law was that it would prevent the journeymen injuring themselves. Whenever the devil wants to do mischief he assumes the garb of holiness, and whenever a certain class of persons wish to commit a more than usually flagrant violation of justice it is always done in the name of humanity.

… The journeymen, …, know their own interest better than it is known to the legislator; and they would be all the richer if there were not an idle capitalist in the country. …

If the workmen do not frighten away the skill of the contriver and the master -- and where can that be put to so good a use as where there are plenty of skilful hands -- and even if they should, the wide spread of education among the mechanics and artisans will soon repair the loss, they will frighten away no other part of the national advantages. The merest tyro in political economy knows that the capitalist cannot export any great quantity of food, clothing and machines from this country, nor even the gold and silver which forms the current coin of the realm, to any advantage; either he must bring back an equivalent, which returns him a profit when consumed here, or he must carry with him those skilled labourers who have hitherto produced him his profit as they have consumed his food and used his instruments and machines. …

VII

The wide spread of education among the journeyman mechanics of this country diminishes daily the value of the labour and skill of almost all masters and employers by increasing the number of persons who possess their peculiar knowledge. At the same time, masters and employers cannot hope that the labourers who are not capitalists will remain long ignorant of the manner in which masters who are both labourers and capitalist lend themselves to the views of the capitalists who are not labourers. They are daily acquiring this knowledge, and masters cannot therefore rationally expect a termination to the present contest. …

The improved education of the labouring classes ought, in the present question, to have great weight also with statesmen, and with the community at large. The schools, which are everywhere established, or are establishing, for their instruction, make it impossible for the greatest visionary to suppose that any class of men can much longer be kept in ignorance of the principles on which societies are formed and governed.

…must be a very blind statesman who does not see in this indications of a more extensive change in the frame of society than has ever yet been made.

…e interest of the different classes of labourers who are now first beginning to think and act as a body, in opposition to the other classes among whom, with themselves, the produce of the earth is distributed, and who are now only for the first time beginning to acquire as extensive a knowledge of the principles of government as those who rule, is too deeply implicated by these principles to allow them to stop short in their career of inquiry.

…having no reason to love those institutions which limit the reward of labour, whatever may be its produce, to a bare subsistence, they will not spare them, whenever they see the hollowness of the claims made on their respect. As the labourers acquire knowledge, the foundations of the social edifice will be dug up from the deep beds into which they were laid in times past, they will be curiously handled and closely examined, and they will not be restored unless they were originally laid in justice, and unless justice commands their preservation.

VIII

On the side of the labourers there is physical strength, for they are more numerous than their opponents. They are also fast losing that reverence for their opponents which was and is the source of their power, and they are daily acquiring a moral strength which results from a common interest and a close and intimate union.

The capitalist and labourers form the great majority of the nation, so that there is no third power to intervene betwixt them. They must and will decide the dispute of themselves. Final success, I would fain hope, must be on the side of justice.

I am certain, however, that till the triumph of labour be complete; till productive industry alone be opulent, and till idleness alone be poor, till the admirable maxim that "he who sows shall reap" be solidly established; till the right of property shall be founded on principles of justice, and not on those of slavery; till man shall be held more in honour than the clod be treads on, or the machine he guides -- there cannot, and there ought not to be either peace on earth or goodwill amongst men.

Should it be said, then, as perhaps it may, that unless there be profit, and unless there be interest, there will be no motives for accumulation and improvement, I answer that this is a false view, and arises from attributing to capital and saving those effects which result from labour; and that the best means of securing the progressive improvement, both of individuals and of nations, is to do justice, and allow labour to possess and enjoy the whole of its produce.

 

 

 

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