The purpose of the previous chapters has not been to provide an essay on the follies and stupidities of our ancestors, but to demonstrate two propositions of the highest importance, without which an understanding of such a man as Peel or of almost any other of the statesmen of the nineteenth century is quite impossible, without which indeed our own understanding of ourselves is quite impossible. Its purpose has been to show that it was quite unnecessary for anyone in nineteenth century England to have suffered poverty and to show how it was that thousands of perfectly honest men, the victims of a false education and of a question-begging political economy, nevertheless thought that the poverty of vast masses of their fellow countrymen was not only necessary but permanently inevitable.
Not the least among the services rendered to modern thought by the supporters of Major Douglas has been to familiarize the public with the notion that poverty is unnecessary. In doing so they have rightly insisted on the immense increase of productivity which the modern machine has made possible. But some of them have been less happy when they have spoken of the paradox of starvation in the midst of plenty as a paradox but recently arisen and contrasted our age of abundance with previous ages of supposed scarcity. Englishmen have been starving in the midst of plenty for four hundred years. A hundred years ago Cobbett found(77) in his England starving in the midst of abundance ... the Law Church parsons putting up in all the churches thanksgiving for a plenteous harvest, and the main mass of the labouring people fed and clothed worse than the felons in the gaols. A hundred years before Cobbett the very phrase, as we found, was on the lips of Bishop Berkeley. [Query 446.] Two hundred years before Berkeley, Sir Thomas More was writing of the same phenomenon in his Utopia.
Though the number of sheep increase never so fast, yet the price falleth not one mite, because there be so few sellers. For they be almost all comen into a few rich mens hands, whom no need forceth to sell before they lust.... Thus the unreasonable covetousness of a few hath turned that thing to the utter undoing of your island, in the which thing the chief felicity of your realm did consist.... To this wretched beggary is joined great wantonness, importunate superfluity and excessive riot.... Suffer not these rich men to buy up all, to engross and forestall, and with their monopoly to keep the market alone as they please. We must go back behind Sir Thomas More to find an age where a man could not starve save when there was not enough food to feed him.
By the nineteenth century improvement of communications had quite banished that possibility of occasional famine, which was the one real weakness of the medieval economic system. But for evil communications had been substituted a much more potent enemy of human happiness an evil educational system. Nothing but an educational system which deliberately kept from him such writings as those of Bishop Berkeley could possibly have induced Peel to imagine that in a return to the double-money system the country could find stability, nor could anything but a deliberate blocking of the mind to all understanding of the middle ages have led a man to neglect the discovery of the medieval kings that prices can be kept stable by altering from time to time the metallic content of the coinage.
It is said that the younger Pitt once greeted Adam Smith with the remark, We are all your pupils here. It was the tragic truth. No one who reads the strong pages of the Wealth of Nations can fail to be captured with delight at their powerful reasoning. The faults of that book are not in its reasoning, but in its premises in its unproved assumption that a society must necessarily consist of a few capitalists and the propertyless proletariat, who can only get a living by working for the capitalists for a subsistence wage. To St. Thomas Aquinas property existed to promote the well-being of society, but to Adam Smith society existed to defend the rights of the owners of property. Cupiditas, to St. Paul and to all Christian tradition radix malorum omnium, to Adam Smith and the Benthamites was radix bonorum omnium.
It is no part of the business of this book to draw out a general indictment of the Universities or of the public schools. They have made their contribution both to happiness and to culture, keeping alive the love of scholarship of a sort and of those poets whose theories were not inconvenient to their masters. They have been a bulwark against the cram-shops and the state-schools and the trickeries of vocational education. Yet even the most fervent of their lovers must in fairness admit that in the dark age of the great betrayal, when the poor of England were lashed back to their unnecessary poverty, the strange handful of ill-assorted men who at all understood what had happened to England and who raised their voices in protest, were almost without exception people who by accident had escaped the influence of the educational system. There was Lingard, the Winchester carpenters son, driven by the happy accident of a Penal Law to learn English history over the seas beyond the reach of Whig bribery. There was Cobbett, the farmers son, who went to no school and who learnt no history of the past until in middle age, when he had already learnt the history of the present and knew from experience how much truth to expect upon the lips of governors Sadler, picking up learnings crumbs at his own whim in his fathers library Disraeli, the strange alien exotic, like an orchid in an English green-house, who saw so clearly simply because he saw from outside later, a Carlyle or a Ruskin.
Meanwhile, Dr. Arnold, the founder of the public-school system, when appointed Regius Professor of History at Oxford, was telling(78) his biographer, Stanley, that he could not bear to plunge (himself) into the very depths of that noisome cavern, the Middle Ages, and to have to toil through centuries of dirt and darkness centuries in which, as Thorold Rogers was to show, the poor were materially some six times better off than they were in Dr. Arnolds England. In preference to such a painful theme the doctor would prefer to dwell on the deep calm of the first seventy years of the eighteenth century as containing within itself the seeds of our future destiny. [Ibid., p. 300.] There stands irrefutable the stinging gibe that the battle of Waterloo was won on the playing-fields of Eton that battle that laid finally in the dust the great hope of the worlds freedom from the empire of usury. But the battle against Waterloo, the battle for the overthrow of the monstrous Thing, erected on the ruins of Napoleon, was fought by strange and gallant men from nowhere in particular. There came no help from Eton nor from Oxford for that battle. From Harrow there came only Shaftesbury and Byron.
Let us then bear in mind, while studying the history of the nineteenth century, this first point that its poverty was unnecessary. Whether it was better for the country to produce as much as possible of her own food or to produce a surplus of manufactured goods and exchange them against the food of other countries was a secondary detail. The important truth was that there was no difficulty at all in procuring a sufficiency of food for all. And, if you ask, how then anyone can have been in favour of preserving this unnecessary poverty, the answer is, that no one could have been in favour of it, had it not been for a system of education, carefully training them in ignorance with its question-begging phrases such as favourable balance of trade, sound money, artificial prosperity, gold flowing hither and thither and the like.
Even after the publication of Thorold Rogerss figures, it will, I am sensible, seem to some an exaggeration to say that poverty in the nineteenth century was unnecessary. They will perhaps admit that wealth was, and is, unfairly distributed, but there is in their minds the memory of one of those calculations, in which Dean Inge delights and which from time to time pop out in the correspondence columns of newspapers, according to which, if we divided the national income out equally, there would only be some £150 a year per family. But it is not suggested that the problem could be solved merely by dividing out equally the goods that are at present produced. It is clear that effects of a greatly unequal distribution of wealth are that the country produces less goods than it might produce and produces the wrong sorts of goods. The first business of a society, Aristotle tells us, is to see to it that its members can live. Therefore, the first business of its economic system is to produce a sufficiency of food and clothing, or of goods that can be exchanged for food and clothing, to meet the necessities of the countrys inhabitants. The necessities satisfied, then by all means give attention to the luxuries the problems of living well. Now it is clear that the effect of an unequal distribution of an income will be that a large proportion of the countrys labour will be occupied in the production of luxury goods or the performance of luxury services, even though the necessities of the poor are not satisfied. It is necessary for a high civilization that a proportion of its members, in the various professions from lawyer or doctor down to flunkey or advertising agent, should be occupied in the performance of services rather than in the direct production of goods. But in an unequal society the proportion of the population engaged on such services is excessive. Therefore the result is an insufficiency of necessities, not because the country is incapable of producing them but because, with the given distribution of purchasing power, there cannot be an effective demand for them.
Nor is it possible to hope for a remedy so long as poverty remains the penalty of unemployment. For, with the fear of such a penalty, it is impossible to expect people to give a fair consideration whether their work is socially desirable or not. Where purchasing power is dependent upon a job and bitter poverty the reward of unemployment, it is inevitable that every individual will be only concerned to get a job and will care little whether that job is one for serving or for exploiting the community. It is inevitable, too, that the humane tendency in every profession will be to spin out the jobs as long as possible and to divide them between as many people as possible. Within every profession there is competition, but every profession as a whole is a conspiracy to pilfer the community. Lawyers want to make the law not as simple as possible, but so complicated there will necessarily be work for a lot of lawyers. Working men fight labour-saving devices simply because they do save labour. Every new suggestion is judged not on its merits but by the test whether it will save or will make work. And thus in the past the abolition of torture was no doubt opposed on the ground that it created unemployment among the torturers, and certainly to-day orders for armaments from powers that are but little friendly are welcomed on the ground that even if British workmen are to be blown to pieces by those guns to-morrow, at least they are to be employed in the making of them to-day.
We are told that there is a great moral risk in giving people money for doing nothing. And so there is; you have only to look at the rich to see that. But is there no moral risk in giving them money for doing things that had much better not be done at all ? How many men are there whom the world would have been well advised to have paid all the money that they ever earned on the sole condition that they never did any of the jobs that they were paid for doing ? We are continually reading statistics of the large numbers of the population employed in services. What proportion of those services are really services to the community at all ? What proportion of the population is not in truth rather engaged in an unholy advertisers struggle to create discontent among its fellow-citizens and to prevent them from finding satisfaction in the simple pleasures of life ? And yet those services use up not only labour but also raw materials and minerals that could much better have been otherwise employed. What proportion again of the goods that we consume I will not ask what proportion could we do without, for there is no reason why we should live in an utterly Spartan simplicity. But what proportion would we much rather do without ? What proportion make no sort of contribution to our happiness ? We allow ourselves to be persuaded that we want them only because, if we refused to buy them, it would create unemployment.
It is therefore not possible to estimate the potential standard of living of a country England in Peels time or any other country by merely considering its actual productivity. What is necessary is to put aside for the moment all monetary problems of distribution and to try to estimate its productive capacity as a purely technocractic problem. Now Cobbett, who had been a working farmer and who knew well what he was talking about on such matters, in the course of his Rural Rides visited on the 29th August, 1826, the village of Milton, in Wiltshire. He had the curiosity to make an estimate of the productive capacity of that village. The village contained, according to the population returns of the time, 500 people, including women and children. The land of this parish, he found,(79) produces annually about 3,000 quarters of wheat, 6,000 quarters of barley, the wool of 7,000 sheep, together with the pigs and poultry ... leaving green or moist vegetables out of the question ... and saying nothing at present about milk and butter.
He then drew up what he considered a proper dietary for a family of five. Such a family would want 5 lb. of bread a day; they would want a pound of mutton a day; they would want 2 lb. of bacon a day; they would want, on an average, winter and summer, a gallon and a half of beer a day. Such a dietary, which he considers reasonable, would cost them, he reckons, £62 6s. 8d. a year. In fact; with a wage of 9s. a week, the labourer at that date only received £23 8s. a year. Yet the productivity of the village of 500 was sufficient to provide food at the more generous standard of living for 2,510 people. That is to say, the condition of agricultural science in Cobbetts time was such that every one agricultural family, allowing for non-productive or only partially productive women and children, was able to produce food sufficient to maintain five families at a proper standard of life or fifteen families at the standard at which the poor were compelled to live. Milton was in no way an exceptional village. What was true of it was true of thousands of villages throughout the length and breadth of the country.
To what extent England should have continued to produce her own food, to what extent it would have been wise to obtain her food by the exchange of her surplus manufactured goods, were second and secondary controversies. Cobbetts figures make it quite clear that, either way round, whether under free trade or under protection, there need have been no difficulty a hundred years ago in diverting a reasonable proportion of the nations labour to services and distribution and to the production of non-consumable goods and in still having a quantity of food sufficient to banish all want from the land.
The truth was that the controversy of protection and free trade, like so many of the controversies of the nineteenth century, was unreal. It was a battle, as Matthew Arnold put it, Where ignorant armies clash by night.(80) It was hotly argued whether it was a good thing or a bad thing to exchange our manufactured goods for foreign food. But we did not, to any important extent, exchange our manufactured goods for food at all. In the year 1720 we imported £6,090,083s worth; we exported £6,910,899. That is to say, we did at that date, roughly speaking, exchange goods against goods. In 1760 we imported £9,832,802s worth, but we exported £14,694,970s worth. In 1800 we imported £28,257,781s worth and exported £34,381,617s worth. In 1815 we imported £32,987,396s worth and exported £58,624,550.(81) With every year there was a widening surplus of exports over imports. Throughout all the years of distress we were not only giving away goods every year to foreigners for nothing, but every year we were increasing the quantity of goods that we gave away.
It will of course be said that we did not give them away. We lent them, and our foreign investments were there, ready to be called in in time of need. But what is a time of need, if it be not a time of need when working men starve on what they are paid for their labour and when, as Cobbett was continually proving to be the truth during Liverpools Government, the convict in the gaol is given a better diet than the agricultural labourer could possibly purchase with his wages ? In the years after 1815, for instance, Mr. Slater tells us,(82) The American markets were grievously overstocked with all sorts of British manufactures.... In Belgium riots took place to prevent the sale of British goods. From Germany there arose an outcry that the new British tyranny that was determined to crush out German manufactures by the sale by auction of vast quantities of British goods at rubbish prices was even more dangerous and odious than the tyranny of Napoleon. There can be no doubt that the peculiar phenomena of British export trade at this period paved the way for the subsequent building up of hostile tariffs against England on the Continent of Europe.
At the same time Robert Owen and his son went inspecting the conditions under which the creators of this favourable balance were working. They reported,(83) Not in exceptional cases but as a rule, we found children of ten years old worked regularly fourteen hours a day with but half an hours interval for the mid-day meal, which was eaten in the factory. In some cases we found that greed of gain had impelled the mill-owners to still greater extremes of inhumanity, utterly disgraceful indeed to a civilized nation. Their mills were run fifteen, and in exceptional cases, sixteen, hours a day with a single set of hands, and they did not scruple to employ children of both sexes from the age of eight. We actually found a considerable number under that age. It need not be said that such a system could not be maintained without corporal punishment. Most of the overseers openly carried stout leather thongs and we frequently saw even the youngest children severely beaten. We sought out the surgeons who were in the habit of attending these children, noting their names and the facts to which they testified. Their stories haunted my dreams. In some large factories from one-fourth to one-fifth of the children were either cripples or otherwise deformed or permanently injured by excessive toil, sometimes by brutal abuse. The younger children seldom held out more than three or four years without serious illness, often ending in death. When we expressed surprise that parents should voluntarily condemn their sons and daughters to slavery so intolerable, the explanation seemed to be that many of the fathers were out of work themselves and so were in a measure driven to the sacrifice for want of bread.
The sons of bitches, explained(84) a Manchester merchant to Francis Place, had eaten up all the stinging nettles for ten miles round Manchester and now they had no greens to their broth. In the Midlands the correspondent of the Government newspaper, the Courier, was convinced that things were not so bad. So he went to see and reported, Some inconvenience exists but certainly not the grievous distress spoken of, unless it be in the manufacturing towns, where the effects of peace after war and imprudent speculation have undoubtedly thrown a great majority of families out of bread.(85) The rugged individualism of the system ! It was not, be it noted, the great majority of families who speculated, nor was it because the bread was lacking that they were compelled to suffer some inconvenience by going without it.
Is it not a sin crying to Heaven for vengeance that anyone should have had the impudence to speak of savings wrung out in such a fashion and from such conditions ? But, beyond that, once that they attained to any important volume, it became entirely untrue that the foreign investments could be called in at will, just as it was untrue that any important proportion of holders of banks Promises to Pay could in practice convert those Promises into cash. Debts can only be paid in goods. Our foreign debtors can therefore only repay us their debts in some goods or other which they produce and which we are willing to receive. If we did not consider unemployment an evil, it might not be impossible to find such goods of repayment. But, while we do consider unemployment an evil, it is impossible to find in our debtors countries goods of repayment, which we do not ourselves produce or wish to produce, on a scale sufficient to repay any important proportion of our foreign investments.
In 1931 our foreign debtors threatened to repay us our debts for that is what calling in our foreign investments means. What happened ? We announced that there was a national crisis; we called on all parties to present a united front before this menace of catastrophe. The Labour Government under Mr. Ramsay MacDonald fell from office and was succeeded by a National Government under Mr. Ramsay MacDonald. We put a tariff on foreign goods to prevent our debtors from paying their debts. We cut our wages and salaries to the bone so as to make certain that, if any foreign goods did sneak into the country, no one would be able to afford to buy them. Not until the balance of trade had been so altered that it was certain that not a penny of foreign debt was being repaid to us, did our statesmen announce that the crisis had been surmounted. Even then, the Chancellor of the Exchequer told us, we could not really congratulate ourselves that all was well until foreign lending had started again.
But, it is sometimes objected, while it is a commonplace that the system has broken down to-day, it at any rate served us well for a long time. For a hundred years, for two hundred years perhaps, people in England lived comfortably on their foreign dividends, regularly received. Such an objection, common as it is, betrays a misunderstanding of the whole economic history of the last two hundred years. Had we had a favourable balance of trade for half a dozen years and then in the seventh year called in our loans and enjoyed instead an unfavourable balance, it would have been fair to argue that the system was working. But that was not what happened. Every year with but few exceptions, if you count in our invisible exports such as shipping and other services, we had a favourable balance of trade; every year we gave away more than we received. Therefore it is evident that last years foreign investor, who thought that he was this year receiving his dividend from his foreign investment, was not really doing so at all. He was really living on the savings of this years foreign investor, who in his turn was to live on the savings of next years foreign investor, and so on and so on, until the systems final and inevitable collapse. As Mr. Emil Davies has put it,(86) The cynic who surveys the history of foreign lendings may be pardoned if he comes to the conclusion that, broad and long, the borrowing nations of the world pay interest on loans just about to the extent that their creditors advance them the wherewithal to do so.... The net result over a period of years is that as much foreign money flows in as goes out, nominally as interest.
It follows, says Professor Pigou(87) from his description of the process of foreign lending, that Labour must be less well off in terms of things in general than it would have been if the opening for investing capital abroad had been closed. Why then does it all go on ? Because at any given moment the individual who has made a foreign investment has every interest in creating in the public mind a bias in favour of further foreign investments, since it is out of those further investments alone that he can hope to get his dividends.
Again the system which enforces the payment of debts in monetary terms while it permits alterations of the price-level compels a country to produce less than it could produce through its creation of unemployment. Take the situation which caused the Ely riots of 1816. With prices falling the landlords had to repay the debts which they had contracted at the higher price-level. Therefore they could not afford to reduce their rents. With rents high the farmers could not afford to reduce the price of corn. On the other hand, with less money about owing to deflation, there was not sufficient purchasing power to buy corn at the price at which the farmer could produce it. As a result, the landowner was driven into bankruptcy, good corn land was allowed to go fallow, while those who in past years had worked for the farmers as labourers starved for lack of purchasing power. They paraded the countryside, demanding Bread or blood, and the Government hanged five of them and transported five for life.(88) But their story is only an especially striking example of a story that has been told again and again in England from their day to our own.
The productive capacity of Peels England was then such that there was no need for anybody in the country to be in poverty. That is the first and capital point. Set beside it the second that the financial system which Peel imposed upon the country was one which decreed that, however many times that productive capacity might be multiplied, it was mathematically impossible for the poor ever to escape from poverty. No possible form of society, wrote Peels master, Malthus,(89) could prevent the almost constant action of misery upon a great part of mankind, if in a state of inequality, and upon all, if all were equal.
Let us understand why.
Peel spoke of having put the country back upon an automatic metallic currency and of a return to the ancient right standard of England. The traditional monetary system was one which caused all payments to be actually made in metallic money. Had Peel wished to return to that, his policy must have been to collect all the gold on which he could lay his hands, to call in the banknotes, private and Bank of England, that were in circulation, to divide the total quantity of gold by the number of pounds that he possessed, to decree that the new sovereigns should consist of the resultant amount of gold, to coin such sovereigns and to hand them out to those who had previously possessed bank-notes. Such a system might have been called an automatic metallic system. We need not delay to consider the difficulties which the working of it would have presented, for it was a system entirely unlike that which he did establish. At the time when cash payments were resumed the Bank of England possessed some £11 million odd in cash and bullion. There were in circulation about £60 million of bank-created money Bank of England notes, private bank-notes, and bank-deposits. It was not proposed to cut down the countrys effective monetary supply to £11 million, nor yet so to devalue the pound as to make a stock of gold, which yesterday represented £11 million, represent £60 million to-day. It was proposed to return to the double-money system, which Berkeley had condemned and which had brought the country to catastrophe in 1797 to bid the people do their business with the £60 million of bank-money, telling them for their comfort that they could convert any one of those pounds into a pound of gold if they wanted to. A system less automatic it would be impossible to imagine.
It is not necessary to follow through the monotonous and dreary story of the breakdown of Peels system every single time that it was subjected to any strain from 1821 to 1931. That story has been often told notably in Dr. McNair Wilsons Monarchy or Money Power and in Mr. Feavearyears Pound Sterling but it is important rather to understand why, under it, it is impossible for the vast mass to escape from the tyranny of poverty. The amount of money in circulation, under Peels system, obviously depends upon the amount of gold in the country. If the banks as a rule lend ten Promises to Pay for every pound of gold that they possess the proportion which they soon adopted then if £1 of gold leaves the country, £10 of Promises to Pay have to be withdrawn from circulation by the banks refusing to make new loans when old loans have been repaid. Therefore the possessors of gold will be the dictators of the countrys economic life, and, as Dean Swift and Bishop Berkeley had understood in the previous century, gold will inevitably gravitate into the pockets of those who possess this strange privilege of making up money.
Now the proportion of their wealth that these men spend, or can spend, on their own pleasures and necessities is trivial and negligible. They put money into circulation not by spending it but by lending it. You may ask, what is the good of lending unless one day you intend to spend, but we are concerned with a consideration not of what a wholly balanced person would do with his money but of what the men who shaped the nineteenth century did in fact do with it. And we must recognize that to those men there was an almost mystical value in merely saving and piling up with no intention of ever spending what had been saved the very notion of spending ones capital seemed to them wicked and horrible. Such a philosophy was the price that we had to pay for allowing ourselves to be dominated by Puritanism in the seventeenth century. These men claimed, too, the right to invest their money wherever in the world it best suited them, and it would again have seemed to them wicked and horrible not to invest it in the place whence it would earn the largest immediate interest. Work all you can, make all you can, give all you can, preached the great Wesley to his disciples. Work all you can, make all you can, invest all you can, taught their descendants, emancipated from dogma. The wheel had turned full circle and Townshends education had launched upon the world a race, who claimed not merely that usury should be permitted but that rather there should be accorded to it something of a religious worship.
Now Peels Act conceded to the owner of gold the right to move his gold into or out of the country at will. Money was to be allowed to find its own level. Once that this is understood, it is easy to see how under Peels system it was mathematically impossible for the poor to escape from their poverty. By Peels system the Government was prevented from increasing the monetary supply. Now money could only come into circulation in the shape of loans from those who had the privilege of inventing it. The inventors of money issued their loans to those who would pay the best interest. Other things being equal, the less that a producer pays out in wages, the more is he able to pay in interest to the money-lender; the more that he pays in wages, the less can he pay in interest. With money free to find its own level, the lender can place his loans in any quarter of the world that he chooses. Thus it is obvious that any producer who tries to pay more than the lowest wages will be prevented from doing so, because, if he makes such an attempt, he will not receive the loans to pay his wages with and will therefore be driven into bankruptcy.(90)
It is idle to say that humane feelings would prevent the working out of the system in its full ruthlessness. We will later have occasion to consider the causes which led, to some extent, to its modification in the second half of the century. But we must never forget that in the first half of the century it was not modified at all. Productivity, according to the estimate of Sir Charles Morgan-Webb,(91) was increasing by an average of 3 per cent per annum, which means that in 50 years it was multiplied by about 4½. Population was doubled. But not one pennyworth of advantage from the countrys increased productivity went into the pockets of the working man. There was no general rise in wages at all in the first half of the century. Higher wages in the new industries were balanced by lower wages in the old. Rent increased. The Royal Commission of 1840 gave the following figures of the wages, and food purchasable with those wages at the current prices, of hand-loom weavers.(92)
.................. s.d.lb. of Food.
1797-1804 ....... 268281
1804-1818 ....... 147131
1818-1825 ....... 89108
1825-1832 ........ 6483
1832-1834 ........ 5683
The death-rate increased from 19.98 in 1806-1816 to 20.33 in 1816-1826 and 21.65 in 1826-1836.(93)
Doubtless the employers had their humane feelings, but they were the victims of a system every bit as much as their workpeople. Doubtless the money-lenders had in their private capacities humane feelings, but they were captured by an evil education which led them to think that it would be a disastrous sentimentality to be softened by those humane feelings. They practised usury with all the awful concentration of a religious fanatic. Talk of religious persecution! What religion has ever persecuted as the great religion of Mammon persecuted in early nineteenth century England ? Capitalists to-day sometimes complain of the unfairness of communist abuse of them. But there is nothing which the communist of this century says of them by way of abuse which they did not say of themselves in the last century by way of praise.
It is a most important truth that the financial system stands condemned not so much by what its enemies say against it as by what its friends say for it. Money, they say, must be allowed to find its own level. You cannot expect people to extend credit facilities unless they are to be allowed to share in the resultant increased productivity. But there is no other profession on the face of the earth that would not be ashamed to proclaim such maxims as its guides. Why should not soldiers desert in the middle of battle if they are not given higher pay ? Why should not doctors put up their fees when there is an epidemic and announce that, if their patients will not pay the higher fees, they can be left to die ? Perhaps there have been in history doctors and soldiers who have behaved in such fashions. Certainly there have been financiers who have been much better than their professed principles. Our objection is not that all financiers are cads, but that they all boast of being cads. For what is a cad but a man who in principle always takes the fullest advantage that he can of his neighbours necessity?
People to-day are familiar with the general theories of Ricardo and Malthus, but do they actually read them ? Have they any notion of the language in which they wrote ? Ricardo recognizes that it is just possible that one day a new standard of subsistence may be attained but he does not explain how or by whose action. The probability was, he thought, that wages would fall below the subsistence level rather than rise above it. But then, he comforted the working men, wages could never remain below it for long, because, if they did, a proportion of them would die of starvation and thus the value of labour would increase through its scarcity and wages rise a little. After their privations have decreased their number, or the demand for labour has increased ... the market-price of labour will rise to its natural price.(94) Malthus was in private life an amiable man, a sincere clergyman of the Church of England. Yet he complacently and explicitly advocated starvation of children as a remedy for unemployment. If children were born in excess of the requirements of the labour-market, then both parents and children, he advocated, should be left to starve. The parent should be told that the laws of nature had doomed him and his family to starve. They had no claim on society for the smallest portion of food, and that not because there was not a sufficiency of food but because there was not a sufficiency of work, and therefore, as he argued, no purpose to be served in keeping them alive. Nor was there, according to this prophet of progress, the least hope of amelioration. No possible form of society could prevent the almost constant action of misery upon a great part of mankind, if in a state of inequality, and upon all, if all were equal.(95) The whole of that region (i.e. the East End of London) wrote The Times(96) at the time of the 1866 bank-crash, is covered with huge docks, shipyards, manufacturies and a wilderness of small houses, all full of life and happiness in brisk times but in dull times withered and lifeless, like the deserts we read of in the East. Now their brief spring is over. There is no one to blame for this; it is the result of Natures simplest laws. Those who did not like it, argued Cobden, could accumulate £20 and emigrate. But how could anybody accumulate £20 out of a wage of 15s. a week.
77. History of the Reformation, sec. 411.
78. Arnold, Stanley, ii, 291.
79. Rural Rides (ed. 1853), p. 371.
80. Dover Beach.
81. England under the Hanoverians, Grant Robertson, pp. 335, 336.
82. Growth of Modern England, p. 150.
83. Life of Robert Owen, G.D.H. Cole.
84. Francis Place, Graham Wallas, p. 141.
85. Ibid., p. 253.
86. Investments Abroad, pp. 20-1.
87. Economics of Welfare, pp. 660-1.
88. Growth of Modern England, Slater, p. 247.
89. Essay on Population (ed. 1926), p. 36.
90. Essay on Currency Depreciation, Huskisson.
91. Rise and Fall of The Gold Standard, Morgan-Webb, p. 110.
92. Op. cit., Slater, p. 253.
93. Population Problems of the Age of Malthus, G.T. Griffith.
94. Principles of Political Economy and Taxation, chapter 5.
95. Essay on Population, p. 36.
96. Quoted by Matthew Arnold, Culture and Anarchy, p. 190.