Many points belonging to this subject have been very well discussed byJ. Tucker, in his refutation ofHume'stheory on the final and inevitable superiority of poor countries over rich ones in industrial matters. (Four Tracts on political and commercial Subjects, 1774, No. 1;L. Lauderdale, Inquiry, 206.)
SECTION CCI.
HARMONY OF THE THREE BRANCHES OF INCOME.—INDIVIDUAL DIFFERENCE IN THEM.
As national-economical civilization advances, the personal difference of the three branches of income is wont to become more and more sharply defined.[201-1]The struggle between landowners, farmers and workmen, which Ricardo necessarily assumed, did not exist at all in the middle ages; since landowners and farmers were then usually one and the same person, and since workmen, either as slaves or peasants, were protected against competition properly so called. And so in the industry of that time, based on the trades or on domestic industry.[201-2][201-3]
When, later, the division of labor increases, all the differences of men's aptitudes are turned to more advantage, and are more fully developed. In the same proportion that aworking class is developed, the members of which are nothing but workmen, and can scarcely hope to possess capital or land,[201-4]there grows up, side by side with it, a class of mere capitalists, who come to obtain an ever-increasing importance.
Considered from a purely economic point of view, this transition has its great advantages. How much must the existence of a special class of capitalists facilitate the concentration of capital and the consequent promotion of production, as well as its (capital's) price-leveling influx and outflow! Even "idle" capitalists have this of good, that, without them, no competent man, destitute of means could engage in any independent enterprise. When, indeed, the gulf between these two classes passes certain bounds, it may, politically and socially, become a great evil. (§ 63.)[201-5]
[201-1]Among nations in their decline, rent and interest fall into one possession again, because capitalists here are wont to buy the land. (Roscher, Nationalökonomik des Ackerbaues, § 140 ff.)
[201-2]Related to this peculiarity of the middle ages is the fact that the canon law looked with disfavor on the personal separation of the three factors of production. So also in the prohibition of theWeddeschatreferred to § 161, instead of rent-purchase (Rentekauf), also by extending the idea of partnership to a number of transactions which are only forms of loan. (EndemanninHildebrand'sJahrb., 1863, 176 ff.) Antiquity also, with the independence of its οἶκος,[TN 28]with its slavery, etc., had not developed the difference between the three branches of industry to any extent.Rodbertus, inHildebrand'sJahrbb., 1865, I, 343.
[201-3]If older writers, likeSteuart, etc., speak so little of capital, labor and rent, and so much of city and country, it is not on account of ignorance simply. The contrast between the latter was then much more important than to-day, and that between the former much less developed. When, indeed,Colton, Public Economy of the United States, 1848, 155 ff., claims that because in America the three branches of income do not exist in so separated a condition as in Europe, therefore European Political Economy and its theories are not applicable to America, he forgets that science should not be simply a description or impression made of the reality, but an analysis of it.
[201-4]It is a very characteristic fact that, in our days, when workmen are spoken of, it is generally day laborers and tradesmen that are understood. In Prussia, in 1804, 17.8 per cent. of the population earned their living by letting out their labor; in 1846, 22.8 per cent. as day-laborers, servants, journeymen, tradesmen and factory hands. (Dieterici.)
[201-5]Ricardo, Principles, ch. 4, recognizes the bright side as well asSismondi, N. P., I, 268, orBuret, De la Misère des Classes laborieuses en Angleterre et en France, 1841, its dark side.Sismondithinks that land and the capital employed in its cultivation are found to the greatest disadvantage in the hands of the same person. The existence of a thrifty peasant class (also of a class of tradesmen) is one of the best means to prevent the too wide separation of the three branches of income.
SECTION CCII.
HARMONY OF THE THREE BRANCHES OF INCOME.—NECESSITY OF THE FEELING OF A COMMON INTEREST.
Every class corresponding to a branch of the national income must live with the consciousness that its interests coincide with the economic interests of the whole nation. Whenever the entire national income increases, each branch of it may increase without any injury to the others, and, as a rule,does really increase.[202-1]But it is possible that the land owning class may be specially dependent on the prosperity of the whole people. How easy it is for workmen to emigrate; and how much easier yet for capital! England, to-day, can scarcely carry on a great war, in which it would not, at least at the beginning, have to fight English capital.[202-2]Where the treasure is, the heart is also! The land alone is immovable. It alone cannot be withdrawn from the pressure of taxation or from the distress of war. It alone cannot flee into foreign parts.[202-3][202-4]At the same time, it cannot be denied that the possibilityof being able to carry one's fortune out of a country in one's pocketbook and to be able to procure there with one's money the same conveniences, customs, etc., to which one was accustomed at home, is, under certain circumstances, an important element of political and religious freedom. Moreover, the bright side and the dark of every class of owners, especially the dread of all unnecessary and also of all necessary change, must be common to rent and interest. Hence, where there is a marked and well-defined separation of the branches of income, it will be always considered a difficult but unavoidable problem, how to enable mere labor to take an active part in the affairs of the state.[202-5]
In times when calm prevails (not, however, in transition-crises such as are referred to in § 24), there is a public opinion concerning merit and reward, we might say a public conscience, by which a definite relation of the three branches of income to one another is declared equitable. Every "fair-minded man" feels satisfied when this relation is realized, and this feeling of satisfaction is one of the principal conditions precedent to the prosperity of production; inasmuch as upon it depends the participation (Theilnahme) of all owners of funds and forces. Every deviation from this relation or proportion is, of course, a misfortune,[202-6]but never so great aswhen it takes place at the expense of the wages of labor. It should never be forgotten that rent is an appropriation of the gifts of nature, and that interest is a further fruit obtained by frugality from older labor already remunerated. Besides, the rate of wages when high, generally adds to the efficiency of labor, which cannot be claimed for interest or rent.[202-7]The best means to preserve the harmony of the three branches of income is, however, universal activity. "Rich or poor, strong or weak, the idler is a knave." (J. J. Rousseau.)
[202-1]The contrast betweenAdam Smith, at the end of the first book, andRicardo, ch. 24, in regard to this point, is very characteristic of the times of those two authors. According toSmith, the private interests of the landowners and laborers run entirely parallel; only both classes are easily deceived as to their own interests. Capitalists understand their own interest very well, and represent it with great energy; but their interest is in opposition to the common good, in so far as their profit among a poor and declining people is higher than among a rich and flourishing one.Ricardo, on the other hand, thinks that the interest of the landowners is opposed to that of all others for the reason that they desire that the cost of the production of wheat etc. should be as high as possible.
Related to this is the fact that, inAdam Smith'stime, the new theory of rent remained almost unnoticed, but that after 1815, it became rapidly popular. In a similar way, the socialists of the present time are wont to charge the undertaking class with opposing their own interests to those of the whole people, meaning by the whole the majority. (§ 196 a.)
[202-2]Towards the end of the 14th century the great Flemish merchants always sided with the absolutism of France in opposition to their ownArtevelde.
[202-3]Hence it is, that in so many constitutions, charters of cities, etc., the exercise of the higher rights of citizenship is conditioned by the possession of a certain quantity of land, and that landownership is considered as a species of public function.
I read, a short time ago, the life of a North-German noblemen who, in 1813, had fought bravely against the French, "although he was a man of large estates, and the enemy might therefore very easily have laid hands on them." If this "although" of his eulogist expressed the actual feeling of large landed proprietors, a great many old political institutions would have lost all foundation.
Ad. Müllerwas of opinion that the rights of primogeniture, etc., might be an obstacle in the way of the development of the net income of a nation's economy; but that they gave to the state and to the national life the warlike tone so necessary to them, etc. (Elemente, II, 90.)
[202-4]"The Roman capitalists on whom Pompey counted, left him in the lurch at the moment of danger, because Cæsar destroyed only the constitution, but respected their business relations." (K. W. Nitsch.)
[202-5]Kosegarten, Nat. Oek., 186, thinks that, on account of the struggle between the labor interest and the interest of capitalists, in our times, the "fourth estate" is not as well represented by persons belonging to the propertied classes as the constitutionalist party thinks. And in fact,Jarke, Principienfragen, 1854, 197, would have it represented by the government, in order to prevent the struggle between rich and poor. SeeCherbuliez, Riche ou Pauvre, p. 242 seq.
[202-6]A. Walkershows, in a very happy manner, how no misfortune, however great, whether it come from heaven or from earth, in the shape of pestilence, drought, flood or oppressive taxation, so rapidly and hopelessly ruins a nation's economy as when the harmony which should exist between capital and labor is disturbed by foul play or legal frauds between labor or capital and their reward. (Sc. of Wealth, 66.)
[202-7]CompareLotz, Revision, III, 322 ff., 327, 334 ff. Handbuch, I, 511 ff.Lafitte, Sur la Réduction de la Rente, 56.Fuocoexaggerates this into the principle:che la distribuzione, e non la produzione, sia la prima e principal operazione in economia. (Saggi economici, II, p. 44.)
SECTION CCIII.
EFFECT OF AN EQUAL DIVISION OF THE NATIONAL INCOME.
The best distribution of the national income among a people is that which enables them to enjoy the greatest amount and variety of real goods, and permanently to produce real goods in an increasing quantity and variety.
If the income of a people were divided equally among all, each one would indeed, be, to a very great extent, independent of all others. But then, no one would care to devote himself to the coarser and less agreeable occupations, and these would be either entirely neglected, or people would have to take turns in engaging in them.[203-1](§ 9.) And thus would disappear one of the chief advantages of the division of labor, viz: that the higher orders of talent are devoted to the higher orders of labor. Besides, it is very doubtful, whether, under such circumstances, there would still be any solvent (zahlungsfähige) demand for the achievements of art.
Nor would the saving of capital prosper, where such equality prevailed. Most men consider the average outlay of their equals as an unavoidable want, and save only to the extentthat they possess more than others of their class. If, therefore, every one had an equal income, no one would consider himself in a condition to save.[203-2]The same consideration would deter most men from every economic venture, and yet no great progress is possible where no venture is made.[203-3][203-4]
[203-1]According toSchäffle, System, II, 379 ff., "the distribution of the social return of production which conduces to the attainment of the highest measure of civilization in the moral association of men and in all the grades of that association, and thereby to the satisfaction of all true human wants in the highest degree." Thus only can a satisfactory line of demarkation be drawn between the profit of capital and the wages of labor (384).
[203-2]SeeAristoph., Plut., 508 ff. Not taken into consideration sufficiently byBenjamin Franklin, in his eulogy of the equality of property: The internal State of America, 1784.
[203-3]The essential characteristic of the desert is, according toRitter, Erdkunde, I, 1019 seq., its uniformity. No break in the horizontal plain, and hence no condensation of atmospheric vapor into bodies of water of any considerable size. The composition of the soil is everywhere the same; nothing but masses of silex and salt, hard and sharp. Lastly, extreme mobility of the surface, which undulates with every wind, so that no plant can take root in it. Nearly every feature in this picture finds its analogon in the extreme political and economic equality of men.
[203-4]Les supériorités, qui ne sont dues qu'à, un usage plus intelligent et mieux réglé de nos facultés naturelles, loin d'être un mal, sont un véritable bien. C'est dans la plus grande prospérité, qui accompagne un plus grand et plus heureux effort, qu'est le principe de tout développement.(Dunoyer, Liberté du Travail, IV, 9, 10.) But, indeed, the rich man should never forget that society "inasmuch as it permits the concentration of wealth in his hands, expects that he will employ it to better advantage than the mass of mankind would if that same wealth were equally divided among them." (Brentano.)
SECTION CCIV.
DISTRIBUTION OF NATIONAL INCOME.—MONEYED ARISTOCRACIES AND PAUPERISM.
The extreme opposite of this, when the middle class disappears and the whole nation falls into a few over-rich men and numberless proletarians, we call the oligarchy of money, with pauperism as the reverse of the medal. Such a social condition has all the hardship of an aristocracy without its palliatives. As it is, as a rule, the offspring of a degenerated democracy,[204-1]it cannot in form depart too widely from the principleof equality. Only get rich, they cry to the famishing poor; the law puts no obstacle in your way, and you shall immediately share our position.[204-2]Here the uniformity and centralization of the state, which are an abomination in the eyes of genuine aristocracy, are carried to the extreme. Capital takes the place of men, and is valued more than men. All life is made to depend on the state, that its masters, the great money-men, may control it as they will. The falling away of all restrictions on trade, and of all uncommercial considerations relating to persons and circumstances, gives full play to capital, and speculators seek to win all that can be won. And, indeed, all colossal fortunes are generally made at the expense of others, either with the assistance of the state-power or by speculation in the fluctuations of values.[204-3]The dependence of proletarians on others is here all the greater, because from a complete absence of capital and land, so far as they are concerned, they are compelled, uninterruptedly, to carry their entire labor-force to market; and also because the supply of labor is made in masses embracing a large number of individuals, while the demand for labor lies in the hands of very few, and may be very readily and systematically concentrated.[204-4]So great and one-sided a dependence is, for men too far removed from one another for real mutual love, doubtless one of the greatest of moral temptations. It is as easy a matter for the hopelessly poor to hate the law, as it is for the over-rich to despise it.[204-5]Under such circumstances, the contagious powerof communism, the dangers of which to order and freedom we have treated of in § So, is great. There is a dreadful lesson in the fact of history, that six individuals owned one-half of the province of Africa,when Nero had them put to death![204-6]Externally, a moneyed oligarchy will always be a weak state. The great majority who have nothing to lose take little interest in the perpetuation of its political independence. They rather rejoice at the downfall of their oppressors hitherto, and are cheered by the hope of obtaining a part of the general plunder.[204-7]The rich, too, separated from the neglected and propertyless masses of the nation, and rightly distrustful of them, begin to forget their nationality, and to balance its advantages against the sacrifices necessary to preserve it. But, a merely materialistic calculation leads doubtless to the conclusion, that universal empire is the most rational form of the state. The world-sovereignty of Rome was, by no circumstance more promoted than by the struggles between the rich and the poor, which devastated theorbis terrarum, and in which the Romans generally sided with the property classes.[204-8][204-9][204-10][204-11]However, the worst horrors of the contrast here described can occur only in slave-countries. CompareRoscher, Nationalökonomik des Ackerbaues, § 141.
[204-1]The more the lower classes degenerate into the rabble, and the more the national sovereignty comes into the hands of this rabble, the easier will it become for the rich to buy up the State.
[204-2]In the middle stages of the nation's economy, such as are described in §§ 62, 66, 90, 207, in which even the relative advantages of industry on a large scale over industry on a small scale, are not much developed the making political rights dependent on the possession of a certain amount of property is certainly a means of promoting equality. Hence, therefore, a reconciliation between the differences of class created by birth, may be effected for a long time here.
[204-3]Hermann, Staatsw. Untersuchungen, II, Aufl. 136.
[204-4]Necker, Législation et Commerce des Grains, 1775,1. passim. CompareBacon, Serm fideles, 15, 29, 34, 39.
[204-5]Schiller'sterrible words:
"Etwas muss er sein eigen nennen,Oder der Mensch wird morden und brennen."
—i. e., "Something must he call his own, or man will murder and burn."
It is one ofJ. G. Fichte'sfundamental thoughts that as all property is based on mutual disclaimer, the person who has nothing of his own, has disclaimed nothing, and therefore reserves his original right to everything. (Geschlossener Handelstaat., Werke, III, 400, 445.)
[204-6]Plin., H. N., XVIII, 7.
[204-7]How frequently this circumstance turned to the advantage of the Germans during the migration of nations! CompareSalvian, De Gubern, Dei, VII. Very remarkable answer given by a Roman taken prisoner by Attila, why it must be more agreeable to live among the Huns than in the over-civilized Roman Empire: Prisci legatio, inNiebuhr, Corp. histor. Byzant., I, 191 ff. And thus the conquest of Constantinople by the crusaders, took place amid the jubilation of the populace and of the country people:Nicetus, Chron. Hist. Urbs capta, § 11, 340. This law of nature becomes most apparent when one compares the preponderating power of Rome against Carthage, with its weakness against the Cimbri and Mithradates. May not Hannibal have been to his own country a phenomenon like that which Cæsar was afterwards to Rome? A healthy and united Carthage he certainly could have held against Italy.
[204-8]On the tendencies of the later times of the Jewish monarchy toward an oligarchy of money, seeAmos, 2, 6 seq.; 6 1 ff.; 8, 5 ff.;Micha, 2; 2Isaias, 5, 8 seq. CompareNehem.5. While Exodus, 30 and 38, mentions over 663,000 taxable men, the ten tribes comprising the kingdom of Israel had only 60,000. XII Kings, 15, 19.Ewald, Geschichte des Volkes Israel, II, 2, 320.
[204-9]The spirit of the Grecian moneyed oligarchy is best revealed byPlato, De Republ., VIII, andAristotle, Polit., III, VI, passim, the first of whom considers the contrast between rich and poor as in itself demoralizing (IV, 422). All that can be called by the name of tradition, the political faith of a people, and the national feeling of right, had, in the Grecian world, been transformed into mere reasoning and concerned itself, with frightful exclusiveness, to the contrast existing between rich and poor. CompareAristot., Pol., II, 4, 1, withDroysen, Gesch. des Hellenismus, II, 496 etc., and the citations fromMenanderinStob., Serm., LXXXIX, 503, in which gold and silver are proclaimed almighty. It is a remarkable proof of theomne venalia essein Greece thatThucydides(II, 65) lauds evenPericles, especially for his incorruptibility.Demosthenessays of his contemporaries, that it excited envy when any one was bribed, laughter when he confessed it; that he who was convicted of it (bribery) was pardoned, and he who blamed it, hated. (Phil., II, 121.) Compare the list inDemosth., Pro. Cor., 324;Pausan, III, 10. In Athens, on the occasion of the census-constitution imposed forcibly on the state byAntipater, that in a population of 21,000 citizens, only 9,000 had a property worth 2,000 drachmas or more, that is, enough for a man to live on in the most niggardly way, on the highest interest it would yield. If, in addition to this, account be taken of the large number of slaves, the small number of the property class is all the more surprising, inasmuch as Lycurgus' financial administration bears evidence that the people were in a flourishing and comfortable condition; that afterwards, peace for the most part prevailed, and that Alexander's victories enabled Grecian commerce to make large gains. CompareBoeckh, Staatsh. IV, 3, 9.
In Sparta, the governing class finally numbered only 700 families, 100 of which owned all the land, and 600 of which were, therefore, only noble proletarians. It is well known that the social attempts at reform by Agis and Kleomenes only precipitated the downfall of the state. (Plutarch, Agis and Kleomenes.)Aratosowed a great part of the consideration in which he was held to the reputation which he obtained by protecting the property of the Sicyonian exiles (Thirlwall, History of Greece, VIII, 167), while on the other hand, men likeAgathocles and Nabissupported their faction by persecution of the rich, new debtor-laws and new division of land. (Polyb., XIII, 6, XVI, 13, XVII, 17, XXVI, 2;Livy, XXXII, 38, 40, XXXIV, 31, XXXVIII, 34;Plutarch, Cleom, 20.)Livyexpressly says that all theoptimateswere in favor of the Romans, and that the multitude wantednovare omnia(XXXV, 34). On the frightful struggle between these opposite parties, on the revolutions and counter revolutions, see alsoPolyb., XIII, 1, 2; XVIII, 36 ff., XXX, 14; XXII, 21; XXXVIII, 2, 3;Diodor., XIX, 6, 9;Exc., 587, 623;Livy, XLI, 25, XLII, 5; Pausan, VII, 14. In Bœotia, no one was for 25 years, chosen by the people for the higher offices, from whom they did not expect a suspension of the administration of justice in the matter of crimes and debts, as well as the spending of the national treasure. (Polyb., XX, 14, 5, 6.) The events at Corinth, before its conquest by the Romans, forcibly remind one of the Paris Commune of 1871. This decline had, as usual, begun earliest in the colonies: thus, in Sicily, even inThucyd., V, 4. Milesian struggle off the πλουτὶς[TN 29]and χειρομάχα[TN 30]inPlutarch, Qu. Gr., 32;Athen., XII, 524.
[204-10]The disappearance of the middle class in Rome, between the second and third Punic war, was brought about chiefly by the great foreign conquests made by it. An idea of the wealth which the governors of the provinces might extort may be formed from this among other facts, that Cicero originally demanded against Verres a fine of 5,000,000 thalers. (Cic., in Verrem Div., 5.) Verres is related to have said, that he would be satisfied if he could retain the first year's booty; that during the second, he collected for his defenders; and during the third, for his judges! (Cic., in Verr., I, 14.) EvenCicerobecame richer within the space of one year, in Cilicia, where it was well known he was not oppressive, by 110,000 thalers, which sum does not include numerous presents, pictures, etc. (Drumann, Gesch. Roms., VI, 384.) On the frightful oppression and extortion practised by Brutus (!) in Asia, seeCicero, ad. Att, V, 21; VI, 1.Sallust, in his Jugurtha, has shown how such men waged war, and to what extremes their well-deserved want might push them in his Catiline.Patricium scelus!Most of the senators were in debt to Crassus; and this, together with his great political insurance-activity and power in elections, criminal cases at law, etc., it depended that he, for a time, figured beside Cæsar and Pompey.
The wealth of these important personages must, and that not only relatively, have made the poor poorer and their luxury excited the covetousness of the people; but especially the great number of slaves they kept, combined with their pasturage system of husbandry, which rapidly spread over all of Italy after the provinces had emptied their granaries to supply the wants of the sovereign people, must have made it less and less possible for the proletarians to live by the work of their hands. Previously, the lower classes of the free born had been exempted from the military service, while slaves were conscripted for the fleet. Now, all this was changed; and thus was taken away one of the chief causes which had made the labor of free day laborers more advantageous on the larger estates. (Nitzsch, Gracchen, 124 ff., 235 ff.) The spoils of war and conquest caused the higher middle class to prefer to engage in the usurious loaning of money rather than in industry which would much more rapidly have formed a small middle class. (Mommsen, R. G. I, 622 ff.)
Hence, themisera ac jejuna plebecula, concionalis hirudo aerarii, according toCicero, ad Att., I, 16, 6. At a time, when the Roman census showed a population of over 1,500,000, Philippus, 104 before Christ, otherwise a "moderate" man, could claim that there were not 2,000 citizens who had any property. (Cic., de Off., II, 21.) True, those few were in such a position, that Crassus would allow that those only were rich, who could feed an army at their own expense. (Cicero, Parad., VI, 61;Plin., H. N., XXXIII, 47.) Concerning the colossal private fortunes under some of the earlier imperators, seeSeneca, De Benef., II, 27;Tacit., Ann., XII, 53, XIII, 32; XIV, 35; Dial. de Causis, 8,Dio C., LXIII, 2 seq.
The clients of the time, that is the numerous poorly paid idlers treated as things of little value, in the service of the great, correspond, on a small scale, to the position of the great crowd in relation to the emperor. CompareFriedländer, Sittengeschichte Roms., I, 296 ff. As late as the West-Gothic storm, there were many houses which drew 4,000 pounds in gold, and about 1/3 as much in kind, from their estates, per annum. (Plut., Bibl. Cod., 80, 63, Bekk.) Goddess Pecunia Majestas divitiarum, inJuvenal, I, 113.
If we take the Roman proletariat in its wider extent, the most frightful picture it presents is its slave-wars. Such a war Sicily had shortly before thetribunateof the elder Gracchus, cost over a million (?) livres; and at the same time there was a great uprising of slaves desolating Greece. (Athen., VI, 83, 87 ff., 104.) A second war broke out in the time of Cimbri. But the most frightful was that under Spartacus, who collected 100,000 men, and the course of this uprising will always remain a type of proletarian and slave revolts. It originated among the most dangerous class of slaves, most dangerous because best prepared for the struggle, the gladiators, and among the immenseergastula, where they were held together in large masses. It spread with frightful rapidity, because the combustible material on which it fed was everywhere to be found. It was conducted with the most revolting cruelty. What the slaves demanded before all else was vengeance, and what dread had a gladiator of a death unaccompanied by torture?
After the first successes of the slaves dissensions broke out among them. Such hordes can nowhere long preserve a higher object than the momentary gratification of their passions—a fact which shields human society from their rage. Piracy, also, is another side of this proletarian system. It found its strongest aliment in the system of spoliation practiced by the Romans in Asia Minor. The oppressed along the whole coast, joined the pirates "preferring to do violence rather than to suffer." (Appian, B. Mithr., 92,Dio C., XXXII, 3.) The temples and the wealthy Romans were in special danger. But the worst feature in the horrible picture was that many of the great shared in the spoils with the robbers. They bought slaves and other booty from them at mock prices, even close by the gates of Rome. (Strabo, XIV, 668 seq.,Dio C., XXXVI, 5.) Precisely as the slave-wars were looked upon with pleasure by the poorer free men. Incendiarism was one of the chief weapons of mutinous pauperism. (Drumann, IV, 282.) The celebrated bacchanalian trial and the questions of poisoning which followed it as a consequence (186 before Christ) may be looked upon, in Rome, as the first marked symptoms of the disruption between the oligarchy of money and the proletariat. This put the morality of the higher classes in a bad light, while, at the same time, a large slave conspiracy in Apulia, which was not suppressed until the year 185, exhibited the reverse of the picture. Cato, the censor, endeavored to oppose this tendency by high sumptuary taxes, and by establishing proletarian colonies. At the same time we see the various parties among the nobility uniting and the publicans joining them. (Nitzsch, Gracchen, 124 ff.) The history of the last hundred years of the Republic turns chiefly on the three great attempts made by the proletariat to overthrow the citadel of the moneyed oligarchy, under the Gracchi, under Marius and under Cæsar. The last was permanently successful but entailed the loss of the freedom of both parties.
Among the pretty nearly useless remedies employed, besides those described in § 79, I may mention the following also: the great number of agrarian laws intended to lessen estates of too great extent owned by one person, and to restore a free peasant population, in the years 133, 123, 100, 91, 59 before Christ; the law in Hannibal's time (Livy, XXI, 63) that no senator should own a ship with a capacity of more than 300 amphora; the provision (Sueton., Caes., 42) that all great herd-owners should take at least one-third of their shepherds from the ranks of freemen; the many lawsde repetundis, the first of which was promulgated 149 before Christ, intended to protect the provinces against spoliation by the governors; the L. Gabinia, 56 before Christ, which prohibited the loaning by the provinces in Rome; lastly, a rigid enforcement of police provisions against slaves, especially against their bearing arms, which were carried to such an extent, that slaves who had killed a boar with a spear were crucified. (Cicero, in Verr., II, 3.) The chief rule of every real oligarchy of money is, while they hold the lower classes in general under their yoke with great severity, to keep dangerous elements in good humor at the expense of the state. Among these are especially the rabble in large cities and the soldiery. CompareRoscher, Betrachtungen über Socialismus und Communismus, 436, 437.
[204-11]In medieval Italy, also, popular freedom was lost through a moneyed oligarchy and a proletariat.Popolo grassoandminuto(bourgeoisie—peuple) in Florence. The former were reproached especially with the breach of trust in the matter of the public moneys (Sismondi, Gesch. der Ital. Republiken, II, 323, seq.), which reminds one of the French cry,corruptionin 1847.Machiavelligives a masterly description of the class contrasts during the last quarter of the fourteenth century, in his Istoria Fiorent., III, a. 1378, 4. The poor, whose spokesmen recall the most desperate shibboleths of modern socialists, dwell principally on this, that there is only one important difference, that between rich and poor; that all men are by nature entirely equal; that people get rich only through deceit or violence; that the poor want revenge etc. It is significant how, in Florence, the largest banker finally became absolute despot, and that contemporaneously in Genoa, the Bank of St. George, in a measure, absorbed the state; the former supported by numerous loans made to influential persons like Crassus (Machiavelli, Ist. Fior., VII); the latter by the overstraining of the system of national debt.
SECTION CCV.
DISTRIBUTION OF THE NATIONAL INCOME.—HEALTHY DISTRIBUTION.
Hence a harmony of the large, medium and small incomesmay be considered the indispensable condition of the economicprosperity of a people.[205-1]This prosperity is best secured when the medium-class income prevails, when no citizen is so rich that he can buy the others, and no one so poor that he might be compelled to sell himself. (J. J. Rousseau.)[205-2]Where there is not a numerous class of citizens who have time enough to serve the state even gratis, as jurymen, overseers of the poor, municipal officers, representatives of the people etc. (compare § 63), and property enough to be independent of the whims and caprices of others, and to maintain themselves and the state in times of need, even the most excellent of constitutions must remain a dead letter. Nor should there be an entire absence of large fortunes, and even of inherited large fortunes. The changes of ministry which accompany constitutional government are fully possible only when the choice of men who would not lose their social position by a cessation of their salaries as public functionaries is not altogethertoo limited.[205-3]Thus the transaction of the most important political business, especially that which relates to foreign affairs, requires a peculiar elasticity of mind, and a capacity for routine on the grandest scale, which with very rare exceptions, can be acquired only by habituation to them from childhood, and which are lost as soon as the care for food is felt. The bird's-eye-view of those who are born "great" does not, by any means, embrace the whole truth of human things, but it does a very important side of it. Among this class, as a rule, it is easiest to find great party leaders, while leaders who have to be paid by their party, generally become in the long run, mere party tools.[205-4]It is true that it requires great intellectual and moral power to resist the temptations which a brilliant hereditary condition presents; temptations especially to idleness, to pride and debauchery. For ordinary men, it is a moral and, in the end, an economic blessing, that they have to eat their bread in the sweat of their brow,[205-5]and that they can grow rich only by long-continued frugality.[205-6]However, the distribution of the national income, and every change in that same distribution, constitute one of the most important butat the same time one of the most obscure departments of statistics.[205-7]When inequality increases because the lower classes absolutely decline, there is no use in talking any longer about the prosperity of the nation.[205-8]It is different, of course, whenonly the higher classes become, relatively speaking, higher yet. But even this latter kind of inequality may operate disastrously,inasmuch as it nourishes the most dangerous tendency of democracy, that of envy towards those who are better off.
[205-1]VerriMeditazioni, VI.
[205-2]Aristotle'sview that, in a good state, the middle class should preponderate. (Polit. IV, 6, Sch.)Sismondisays:la richesse se réalise en jouissances; mais la jouissance de l'homme riche ne s'accroît pas avec ses richesses. (Etudes sur l'Economie politique, 1837, I, 15.)
[205-3]If state offices were to be filled by doctors or lawyers who live by their practice, after a time, only those could be had who had no large practice to sacrifice, that is, beginners or obscuranti.
[205-4]Per contra, seeBazard, Doctrine de Saint Simon, 323. ButSismondiis certainly right:nous ne croyons point, que les hommes qui doivent servir à l'humanité de flambeau naissent le plus souvent au sein de la classe riche; mais elle seule les apprécie et a le loisir de jouir de leurs travaux. (Etudes, I, 174.)
[205-5]To appreciate the demoralizing effects of an income obtained without labor and without trouble on men of small culture, we need only witness the bourgeoisie at great watering places, pilgrimage places, seats of courts and university cities supported largely by students. Similarly at Mecca, Medina, Meschhed, Rome, etc. (Ritter, Erdkunde VIII, 295 seq. IX, 32), and even in Palestine, during the crusades, when the miserable Pullanes counted on the tribute of the pilgrims. (Wilken, VII, 369, according toJacob de Vitriaco.)
[205-6]A man with $100,000 a year has a much less incentive to make savings than 100 men with $1,000 each per annum,[TN 31]for the reason that his economic wants are already all richly satisfied, and he can have little hope of improving it by saving. (von Mangoldt, V. W. L., 141.)]
[205-7]Harrington'sfundamental thought (1611-1677, Works, 1700) is, that the nature of the constitution of a state depends on the distribution of the ownership of its land. "Balance of property!" Where, for instance, one person owns all the land or the larger portion of it, we have a despotism; where the distribution is more equal, a democracy, etc. All real revolutions are based upon a displacement of the centre of gravity of property, since in the long run, superstructure and foundation can not be out of harmony with each other. For this reason, agrarian laws are the principal means to prevent revolutions. (Roscher, Gesch. der English. Volkswirthschaftslehre, 53 ff.)Montesquieualso pays special attention to the political consequences of the distribution of wealth. Thus, for instance, in monarchies, the creation of large fortunes should be promoted by the right of primogeniture; in aristocracies, on the other hand, the great wealth of a few nobles is as detrimental as that of extreme poverty. (Esprit des Lois, V, 8, 9.)
[205-8]The common assertion of the socialists, that the inequality of property is frightfully on the increase, is as far from being proved as is the opposite one ofHildebrand, Nat. Oek. der Gegenwart und Zukunft, I, 245 ff. According toMacaulay, Hist. of England, ch. 3, there were, in England, in 1685, only about three (ducal) families with an annual income of about £20,000 a year. The average income of a lord amounted to £3,000; of a baronet, to £900; of a member of the house of commons, to scarcely £800; and a lawyer with £1,000 per annum was considered a very important personage. At the same time, there were 160,000 families of free peasants, that is more than 1/7 of the whole population, whose average income amounted to from £60 to £70. For the year 1821,Marshall, Digest of all Accounts, etc., II, 1833, assumes, that there were 4,000 families with over £5,000 yearly income; 52,000 families with from £1,500 to £5,000; 386,000 families with from £200 to £1,000; 2,500,000 families with less than £200. Compare,per contra, the Edinburg Review, 1835. The income tax statistics of 1847 show that 22 persons had an income of at least £50,000 a year; 376 persons, from £10,000 to £50,000; 788, from £5,000 to £10,000; 400, from £4,000 to £5,000; 703, from £3,000 to £4,000; 1,483, from £2,000 to £3,000; 5,234, from £1,000 to £2,000; 13,287, from £500 to £1,000; 91,101, from £150 to £500.
If we compare these numbers with the corresponding ones of the income tax of 1812, the numbers of those who returned an income of £150 to £500 increased 196 per cent.; of those with an income of from £500 to £1,000, 148 per cent.; of from £1,000 to £2,000, 148 per cent.; of from £2,000 to £5,000, 118 per cent.; of from £5,000 and more, 189 per cent.; while the population in general had increased by about 60 per cent. Compare Athenæum, August, 1850; Edinburgh Rev., April, 1857. Between 1848 and 1857, the development was less favorable, so that the incomes of from £150 to £500 subject to taxation, increased only 7 per cent.; those from £500 to £1,000 about 9.56 per cent.; those from £10,000 to £50,000, by 42.4, and those over £50,000, 142.1 per cent. Between 1858 and 1864, the incomes derived from industry and commerce, subject to taxation below £200, had increased about 19.4 per cent.; those over £10,000, 59 per cent.; while the aggregate amount of all taxed incomes in this category increased 19 per cent. (Stat. Journal, 1865, 546.) According toBaxter, The National Income of the United Kingdom, 1868, there are now 8,500 persons with a yearly income of £5,000 and more, who draw in the aggregate 15.6 per cent. of the national British income, and on the average nearly £15,000 each. There are, further, 48,800 persons with a yearly income of from £1,000 to £5,000; 178,300 with from £300 to £1,000; 1,026,400 with from £100 to £300; and 1,497,000 with less than £100 a year from their property. In addition to this, 10,961,000 workmen on wages, with an aggregate income of £324,600,000. Compare §§ 172, 230.
In France, the number of so-calledélecteurs, who paid direct taxes to at least the amount of 200 francs was, in 1831, 166,583, and increased uninterruptedly until 1845, when it was 238,251, while the population had increased only 8.5 per cent.
In Prussia, the revenue from class-taxation up to 1840, increased, unfortunately, in a smaller proportion than the population: hence the lowest classes must have increased relatively more than the others. (Hoffmann, Lehre von den Steuern, 176 ff.) Between 1852 and 1873, according to the statistical returns from class-taxation and of the classified income tax, the growth of large incomes in the provinces of old Prussia, seems to have been much more rapid than that of the smaller ones. Thus, for every 100 taxpayers, with an income of from 400 to 1,000 thalers, there was an increase to 175.5; of from 1,000 to 1,600 thalers, for every previous 100, 210.2; from 1,600 to 3,200 thalers, 232.3; of from 3,200 to 6,000, 253.9; of from 6,000 to 12,000 thalers, 324.8; of from 12,000 to 24,000, 470.6; of from 24,000 to 52,000 thalers, 576.3; of from 52,000 to 100,000 thalers, 568.4; of from 100,000 to 200,000 thalers, 533.3; of over 200,000, 2,200. Hence, probably, a greater growth towards the top, than the general increase in the population will account for.
This concentration of property took place most noticeably in Berlin, where for instance, between 1853 and 1875 the incomes of from 1,000 to 1,600 thalers increased 212.2 per cent.; those from 24,000 to 52,000, 994.1 per cent. There are now in the whole state 2.24 per cent. of the population (including those dependent on them) subject to the income tax; that is, estimated as having a yearly income of 1,000 thalers. Of the remaining 97.76 per cent., more than a quarter, and probably more than one-half, are as a class free from taxation, because their income is presumably less than 140 thalers (6,049,699 against 532,367, exempt for other reasons and 4,850,791 belonging to classes subject to taxation: these three numbers probably not including dependents). Among the payers of an income tax, there are 79,464 with an average income of 1,237 thalers per annum; 41,366 with 2,171 thalers; 12,305 with 4,279 thalers; 4,030 with 8,383 thalers; 1,655 with 16,527 thalers; 513 with 32,428 thalers; 163 with 65,595 thalers; 39 with 137,692 thalers; 21 with 427,142 thalers; and one with 1,700,000 thalers per annum. (Preuss. statist. Ztschr., 1875, 116, 132, 142, 145, 149.) As the reverse of this picture, we may take the fact that, in 1870, of 1,047,974 cases of guardianship, there were only 208,614 in which there was any property to be looked after. (Justiz-Minist-Blatt, 1872, No. 6.)
The figures from Bremen are very favorable. The incomes subject to taxation amounted, in 1847, to 71.6 thalers per capita; in 1869, to 131.2.[TN 32]The incomes subject to taxation in class No. 1, that is from 250 to 399 thalers, increased 78 per cent.; in class No. 2, 400 to 499 thalers, 45 per cent.; in class No. 3, 500 thalers and more, by 57 per cent. The average income of the third class amounted, in 1847-50, to 1,952 thalers; 1866-69, to 2,439 thalers. In 1848, there were, of estates of over 3,000 thalers subject to taxation, only 38 to every 1,000 inhabitants; in 1866, 49. (Jahrb. f. amtl. Statistik Bremens, 1871, Heft 2, p. 185 seq.)
SECTION CCVI.
NATURE AND KINDS OF CONSUMPTION.
As it is as little in the power of man to destroy matter as it is to create it, we mean by the consumption of goods, in the broad sense of the word, the abolition of or the doing away with an utility without any regard to the question whether another higher utility takes its place; in its narrower sense (consumption proper), a decrease of resources of any kind. Consumption is the counterpart of production (§ 30), the top of the tree of which production is the roots, and the circulation and distribution of goods the trunk. (A. Walker.) There is, also, what Riedel calls immaterial consumption, as when a utility disappears, either because the want itself to which it ministers disappears or because views have changed as to the means to be employed towards its satisfaction.[206-1]
[206-1]Diminutions of value, such, for instance, as an almanac, a newspaper, etc., undergoes simply from the appearance of the next years' etc.; of a shield or a part of an officer's uniform with the initials of the reigning sovereign, only because of the fact of a new succession to the throne. A boot or a glove loses a great part of its value when its mate is destroyed. (Rau, Lehrbuch, § 319.)
SECTION CCVII.
NATURE AND KIND OF CONSUMPTION.—THE MOST USUAL KIND.
The commonest kind of consumption is that caused by the use of a thing, or by the employing of it for the purpose of acquisition or of enjoyment.[207-1]From time immemorial, enjoyment-consumption has been, preponderantly, the affair of women, as acquisition-consumption has been the business of men.[207-2]Other circumstances being equal, the degree or extent of consumption by use (use-consumption) is determined by national character. Thus, for instance, the cleanliness and love of order characteristic of the Dutch have contributed greatly to the long preservation in good condition of their dwellings and household articles.[207-3]
In the higher stages of civilization, the use of goods is wont to be divided more and more into special branches, according to the different peculiarities of the goods themselves, and of the different wants of men; a course of things which is, both as cause and effect, intimately related to the division of labor. I here speak of a principle ofdivision of use(differentiation and specialization). Thus, for instance, Lorenz Lange, in 1722, found only one kind of tea in the trade between Russia and China; Müller, in 1750, found seven; Pallas, in 1772, ten; and Erman, in 1829, about seven hundred.[207-4]As the number ofgradations of different kinds of the same goods increases with civilization, there is, in times of war, a retrogression in this respect, to a lower economic stage.[207-5]
Opposed to this, we have the principle of the combination of use. There are numberless kinds of goods which may serve a great many just as well as they can one exclusive user; and this either successively or simultaneously, inasmuch as there is no necessity why, with the increasing use of the object, the size of the object itself should increase in an equal proportion. (According to Marlo: wealth usable by one; wealth usable by many; wealth usable by all.) Thus, for instance, a public library may be incomparably more complete, and accessible in a still higher degree than ten private libraries which together cost as much as it did. And so, a restaurant-keeper may serve a hundred guests at the same time, with a much greater table-variety, more to their taste, and at a more convenient time, than if each person made the same outlay for his private kitchen.[207-6]While formerly, only the great could travel rapidly, combination of use has enabled even the lower classes to do so in our own days. There is, doubtless, a dark side to this picture, too. Combination of use requires frequently great sacrifices of personal independence, which should not be underestimated when they affect individuality of character, or threaten the intimacy and closeness of family life. It is, however, a bad symptom when the divisionof use increases without any corresponding combination of use.[207-7][207-8]
[207-1]We should also mention here destructive consumption, where the defenders of a country destroy buildings, supplies, etc., only that the enemy may not use them.
[207-2]Compare Die Lebensaufgabe der Hausfrau, Leipzig, 1853;von Stein, Die Frau auf dem Gebiete der National Oekonomie, 1875, and the beautiful remarks ofSchäffle, N. Oek., 166; andLotz, Mikrokosmus, II, 370 ff.
[207-3]In Germany horses are said to last, on an average, 18 years; in England 25; in France and Belgium, only 12 years. (See for the proofs of thisRau, Handbuch II, § 168.) The more civilized a people are, the less do they completely destroy values by use; and the more do they use their old linen, etc. as rags; their remains of food as manure, etc. (Roesler, Grunds., 552.)
[207-4]Ritter, Erdkunde, III, 209. Thus, the French in the 13th century were acquainted with only three kinds of cabbage; in the 16th, with six, about 1651, with 12; they are now acquainted with more than 50; in the 16th century they knew only 4 kinds of sorrel; in 1651, 7; about 1574, only 4 kinds of lettuce; to-day they know over 50; under Henry II., they were acquainted with 2 or 3 kinds of melons; in the 17th century, with 7; now they are acquainted with over 40. (Roquefort, Histoire de la Vie privée des Fr., I, 179 ff.) Instead of the four kinds of pears mentioned by de Serre (1600), there were, in 1651, about 400. (I, 272.) Liebaud, 1570, knew only 19 kinds of grapes; de Serre, 41. (Roquefort, III, 29 ff.) According to the "Briefen eines Verstorbenen," IV, 390, the first kitchen-gardener in London had 435 kinds of salad, 240 of potatoes, and 261 of pease.
And so precisely in ancient times. While the earlier Greeks speak of but one οἶνος,[TN 33]even at the most sumptuous feasts (compare, however,Homer, Il. XI, 641;) and while even in the time of Demosthenes only very few kinds of wine were known (Becker, Charicles, I, 455),Pliny, H. N. XIV, 13, was acquainted with about 80. In this respect the moderns have never returned to ancient simplicity; at least the fabliau, La Bataille des Vins, introduces us to 47 kinds of French wine in the 13th century. (Compare alsoWackernagelinHaupt'sZeitschrift für deutsches Alterth., VI. 261 ff., andHenderson, History of ancient and modern Wines, 1824.) The Lacedemonians, with their intentional persistence in a lower stage of civilization, used the same garment in winter and summer (Xenoph., De Rep. Laced., II, 4); while the contemporaries of Athenæos (III, 78 ff.) were acquainted with 72 kinds of bread. With what a delicate sense for good living the Romans in Caesar's time had discovered the best supply places for chickens, peacocks, cranes, thunny-fish, muraena, oysters and other shell-fish, chestnuts, dates, etc., may be seen inGellius, N. A., VII, 16. CompareAthen., XII, 540.
In the middle age of Italy, the houses had almost always three rooms:domus(kitchen),thalamus,solarium. (Cibrario, E. P. del medio Evo, III, 45.) The manors or masters' houses built on the estates of Charlemagne had 3 and 2 rooms, sometimes only 1, and sometimes 2 rooms and 2 bedrooms. According to an old document of 895, a shed was worth 5 sols, a well-built manor 12. (Anthon, Geschichte der deutschen Landwirth., I, 249 ff., 311.) The Lex Alamanorum, tit. 92, provided that a child, in order to be considered capable[TN 34]of living, should have seen the roof and four walls of the house! See an able essay, capable of being still further developed, byE. Herrmann,in which he endeavors to explain thedivision of useand of labor on Darwin's hypothesis of the origin of species in the D. Vierteljahrsschrift, Januar., 1867.
[207-5]Thus, 1785-1795, the best Silesian wool cost 60, the worst 26, thalers per cwt.; in 1805, on account of the great demand for cloth to make military uniforms, the former cost 78, the latter 50 thalers. (Hoffmann, Nachlass, 114.)
[207-6]The one large kitchen naturally requires much less place, masonry, fuel, fewer utensils, etc., than 100 small ones. Think of the relatively large savings effected by the use of one oven kept always heated! Even the Lacedemonians called their meal associations φειδίτια,[TN 35]i. e., save-meals. Dainties proper can be consumed only in very small portions, but cannot well be prepared in such quantities. A guest at a first class Parisian restaurant has, at a moderate price, his choice of 12potâges,24 hors d'œuvres,15-20 entrées de bœuf,20 entrées de mouton,30 entrées de volaille et gibier,15-20 entrées de veau,12 de pâtisserie,24 de poisson,15 de rôts,50 entremets,50 desserts; and, in addition, perhaps 60 kinds of French wine alone. What more can a princely table offer in this respect? CompareBrillat-Savarin, Physiologie du Goût, Médit., 28.
[207-7]In Diocletian's time, there was purple silk worth from 2½ thalers to 250 thalers per pound. (Marquardt, Röm. Privatalterthümer, II, 122.)
[207-8]Concerning the application of the above principle in industry and in the care of the poor, seeinfra. The advantages afforded by consumption in common, or the combination of use, have been enthusiastically dwelt upon byFourier, and the organization of his phalansteries is based essentially on that principle. In these colossal palaces, which, spite of all their magnificence, cost less than the hundred huts of which they take the place, a ball is given every evening, because it is cheaper to light one large hall, in which all may congregate. The division of use, or of consumption also, is here developed in a high degree. When 12 persons eat at the same table they have 12 different kinds of cheese, 12 different kinds of soup, etc. Even little children are allowed to yield to the full to their gluttonous propensities, since on them depends the productive activity of the so-calledséries passionnées.[TN 36]Compare Nouveau Monde, 272. The Saint-Simonists also characterize theassociation universelleas the highest goal of human development. (Bazard, Exposition, 144 ff.) On the danger of this development to family life, seeSismondi, Etudes I, 43.
SECTION CCVIII.
NATURE AND KINDS OF CONSUMPTION.—NOTIONAL CONSUMPTION.
By the notional consumption (Meinungsconsumtion), as Storch calls it, operated by a change of fashion, many goods lose their value, without as much as suffering the least change of form or leaving the merchant's shop. This kind of consumption, too, is exceedingly different in different nations. Thus, in Germany, for instance, fashions are much more persistent than in France.[208-1]In the most flourishing times of Holland, only noblemen and officers changed with the fashions, while the merchants and other people wore their clothes until theywent to pieces.[208-2]In the East, fashions in clothing are very constant;[208-3]but the expensive custom there prevails, for a son, instead of moving into the house occupied by his father, to let it go to ruin, and to build a new one as a matter of preference. The same is true even in the case of royal castles. Hence, in Persia, most of the cities are half full of ruins, and are in time moved from one place to another.[208-4]
The national income of a country is, on the whole, much less affected by a change of fashion than the separate incomes of its people. The same whim which lowers the value of one commodity increases the value of another; and what has ceased to be in fashion among the rich, becomes accessible, properly speaking, to the poorer classes of the community for the first time.[208-5]The want of varying his enjoyments is so peculiar to man, and so intimately connected with his capacity for progress, that it cannot in itself be blamed. But if this want be immoderately yielded to, if the well-to-do should despise every article which has not the charm of complete novelty,the advantages of the whole pattern-system, by means of which the preparation of a large number of articles from the same model at a relatively small cost, would be lost. Besides, fashion, which makes production in large quantities, for the satisfaction of wants that are variable and free, possible, frequently means even a large saving in the cost of production.[208-6]