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not that of society, which he has in view; but the study of his own advantage naturally, or, rather, necessarily, leads him to prefer that employment which is most advantageous to society.
The individual neither intends to promote the public interest, nor knows how much he is promoting it by directing industry in such a manner that its product may be of the greatest value, but intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.''
This being so, then free competition, the rule of self-interest, and absolute liberty to all men to do as they think best become part of the divine scheme of human happiness; there is no need for the state to interfere, since natural forces alone will bring to all far greater prosperity than can ever result from the decrees of statesmen. Individualism becomes a religious creed, and state control of the actions of capital or labour is rank heresy, blasphemy.
The Pessimists. Smith wrote before the inventions and discoveries had ushered in the new regime; he could therefore afford to be optimistic about the fruits of laissez-faire; but those who took up the theory became almost incorrigible pessimists. This was due to the fact that they lived in the decades when the worst effects of the Industrial Revolution were being realized. The rapid growth of population seemed, in the eyes of Malthus, to presage a day when the world would be overcrowded, and the soil incapable of supplying the bare requirements of food. This increasing inadequacy of the food supply promised deeper and deeper misery for the poor, and the only remedy which could be suggested was that wages should be left to find their own level, under the stress of fierce competition among labourers. Low wages would prevent wage-earners from marrying young or having large families, and thus a strong restraint would be put on the growth of population.
The most ruthless exponent of individualism as applied to wages was Ricardo. He was a thorough-going doctrinaire, and his theory led him to dismal conclusions. Wages, he said, tend to fall to the natural minimum; that mininium is the “price which is necessary to enable the labourers, one with another, to subsist and perpetuate their race, without either increase or diminution.” Above this level wages may go, provided there is a scarcity of labour; but as the tendency is for the working-class population to grow rapidly, especially when high wages prevail, keen competition will come in and keep the rate low. Further, Ricardo barred the closed door against higher wages by his famous “wages fund theory." This theory was that at any given time there was only a certain fixed amount available for wages; this fund could only be raised by reducing the fund for rent and profits-a highly improbable event. Therefore if, by trade union activity or legislation, one class of workmen obtained higher wages, there would be so much less left for other classes. These were the clauses of Ricardo's "iron law of wages, ” and in all things the government must not interfere, no matter how hard the lot of the poor. “Like all other contracts, wages must be left to the free and fair competition of the market, and never controlled by the interference of the legislature.” It was all very gloomy, but since it was based on the natural laws of private property, liberty, supply and demand, and free competition, it was justified, inevitable, and unalterable.
Ricardo's opposition to state intervention in wages contracts was shared by most men of his day, and later. In 1808 a parliamentary committee
declared that a legal minimum wage was “wholly inadmissible in principle, incapable of being reduced to practice by any means that can possibly be devised, and if practicable would be productive of the most fatal consequences. Many years later, Fawcett, Professor of Political Economy at Cambridge, declared that we might as well think of regulating the tides as of determining wages by act of parliament. More conscientious individualists sought justification for low wages in ethical considerations. A writer in the 18th century declared that “Upon the whole we may fairly aver that a reduction of wages in the woollen manufactures would be a national blessing and advantage, and no real injury to the poor. By this means we might keep our trade, uphold our rents, and reform the people into the bargain.' But whatever the question at issue, the prevailing plea was for non-intervention. Bentham said thąt the general watchword of the government should be “Be quiet”; and John Stuart Mill declared in the forties that “Laissez-faire should be the general practice; every departure from it, unless required by some great good, is a certain evil.”
Herbert Spencer. Up to about 1870 individualism was the dominating social and political creed. Then, as its principles were challenged, and its results denounced, a champion arose to pen what was virtually its swan song. In Herbert Spencer's “Man versus the State” individualism became almost rabid. Spencer came to his task armed with a vast scientific knowledge. The current phrases of evolutionary theory were familiar to him, and he used them as weapons with which to slay those who urged stronger social control. His points were two. (1) Competition is the law of progress, in man as in plants and animals. The survival of the fittest, the weakest to the wall, the devil take the hindmost, these are the essentials of progress. Let the least fit, the weakest, be stamped out; then we shall get a finer breed in the next generation. As with foxes, pole-cats, fishes, and birds, so let it be with men.
(2) It follows from the first contention that the state should not interfere with the free play of competition, or the process of weeding-out. Therefore, let the state's functions be confined to maintaining national defence and enforcing contracts. But beyond the army, navy, courts of justice, and police the government must not stray. State education is a " tyrannical system, tamely submitted to by people who fancy themselves free."
It is a “sentimental weakness to ask the state to interfere” in the interests of any suffering class; poor laws, old-age pensions, and the whole range of social and philanthropic legislation do “good that evil may come. Libraries, art galleries, even sanitary supervision, all are condemned. Government control brings in its train“ regulative apparatus” and the domineering official, while socialism “would stop the progress to a higher state, and bring back a lower state.') If people wish to enjoy social benefits, let those interested act on their own initiative; but do not squander the taxpayers' money in providing facilities which few desire or require. Let us have freedom instead of bondage, and if any man objects to the policy of the state let him have the right to refrain from paying taxes, sacrificing in return the protection which the state affords. Spencer was thorough, if nothing else; his state fits Carlyle's phrase, “ Anarchy plus a policeman.” Individualism in Practice. The theory outlined above was comm
mmonly accepted, especially until the middle of last century. It became the doctrine of the Liberal Party in Britain, and suited the interests of the big manufacturers and merchants who supported that party. It was responsible for the repealing of the industrial laws inherited from earlier centuries, and gave an
intellectual stimulus to the free trade movement. It explained partly the opposition to factory legislation, and could be twisted to favour the prohibition of trade unionism. Its advocates were usually perfectly sincere in their belief that individualism would produce a strong, healthy people. They wished to emancipate society from bad laws, and free mankind from the chains which fettered its moral and economic development. They separated the political from the economic, and were generally strong believers in representative government, democracy, and education; but they maintained that the politician could not understand economic affairs, and any attempt by him to regulate business would be ignorantly conceived, unjust, anit disastrous. Finally, men of the Bright and Cobden type were convinced that laissez-faire would become a universal creed; when men were left free to work as they thought best they would recognize that their best interests were tied up with those of men in other lands, and so permanent peace would come because all men realized that they were brothers.
The Reaction. Its Causes and Character. Even before 1850 the defects of individualism were making themselves apparent. The theory had been of use in sweeping away many obsolete restrictions, for the regulations embodied in the mercantile system of the 17th and 18th centuries were almost completely inapplicable to the changed conditions of the 19th. But nothing had been done to fill the gap thus created, and having driven out the one devil, individualism left the house swept and garnished, ready for the entrance of seven others. From the point of view of society, individualism was a negative creed, and when each man builds for himself on a basis of self-interest, the resulting social structure must inevitably be higgledypiggledy—if not something worse. In practice, it was something worse. Individualism produced a system which was no system, a chaos devoid of justice or mercy, and a wild competition between various classes of society (as well as inside each class), in which the many weak were crushed hard against the wall. Liberty, the watchword of individualism, was capable of two interpretations—liberty to tread on others, or to be trodden on; liberty to go up, or to go down. For many it meant the latter, and was a "word of noble sound and squalid result.” Carlyle summed up the situation admirably when he declared, “Liberty, I am told, is a divine thing, but Liberty, when it becomes the liberty to die of starvation, is not so divine.” Self-interest, unfettered by social control, produced an industrial world of low wages, child labour, long hours, slums, overcrowded towns, unhealthy factories, unfenced machinery. “Buying in the cheapest market” meant cheap clothes and nasty, cheap labour, and “The Song of the Shirt." “Freedom of contract” justified the opposition to trade unionism and the legal minimum wage, and led to the extensive exploitation of female and child labour. Here and there individualism threw a gleam of light. Free trade, one of its products, eased the problem of food supplies for the industrial masses, while the abolition of the "taxes on knowledge”-i.e., duties on newspapers, etc.-made possible a cheap press. Further, recognizing the futility of appealing for government aid, the British working-class set out to achieve its own salvation by voluntary united effort. Laissez-faire drove the wage-earners to act for themselves, instead of leaning on the government, and out of this sprang trade unionism, co-operation, friendly societies, and early socialism, movements which have exerted untold influence, not merely in Britain but in every industrial country in the world. Still, admitting all this, the evils of individualism far outweighed its good; for the bulk of the
nation the theory held out little hope beyond poverty and squalor. No wonder, therefore, that political economy, with its justification of these conditions, was dubbed the “dismal science''; no wonder that if you wished to insult a man you called him a political economist.
Even before 1848 some voices were raised in protest against the anarchy of laissez-faire. For 30 years before his death (1835) William Cobbett persistently preached political and economic reforms. All manner of clubs arose during this period, urging similar measures, while for a time Robert Owen endeavoured to persuade the government to take some drastic step for the benefit of the poor. But nearly all such agitations were doomed to failure. At first the official policy was one of suppression, with Coercion Acts and heavy punishments. Canning thanked God that the House of Commons did not reflect the popular will, and he and his contemporaries stuck grimly to individualist principles. During the twenties a more tolerant air prevailed, and the legal ban on trade unions was partly removed, while during the next two decades factory legislation made some progress. But this latter step was generally understood to be exceptional. It had been taken because of the exposure of foul conditions in factories and mines, and because children were not quite able to look after themselves in a world of free contract. These must be remedied, but the acts must not be taken as precedents on which to base any plea for the extension of state intervention. Further, the early factory acts were supported by many members of the landed interest not because they approved the principle involved, but in order to hit the manufacturing interests, who were seeking to deprive land and agriculture of the protection of the Corn Laws.
Lines of Attack. Then came the flood, and from the late forties onwards individualism and its resulting anarchy were attacked root and branch. The attack came from every side. There was scarcely a noted writer whose pen was not dipped in gall against the prevailing creed. Artists found its teaching hard and crude; eminent men in the religious world asserted that Christianity and laissez-faire were incompatible; social investigators revealed black facts showing the results of the policy; and a new school of economists arose, either to urge state intervention or to demand the replacement of capitalism by socialism.
This revolt was of a double nature. On the one hand it was spiritual, attacking the narrow, material selfishness of industry, and the economic theories which sanctioned it. As a remedy it was urged that a better spirit should be infused into economic relationships—more sympathy, co-operation, and equity; but there was little idea of any big change in the economic structure. On this line went the literary giants (Dickens, Arnold, Carlyle, Ruskin, etc.), and to some extent the Christian Socialists. On the other hand was the materialist attack, coming from the socialist writers (Marx, Rodbertus, the Fabians, etc.). These men challenged the whole system as a system, criticized its foundations, and sought to secure its replacement by a new order based on the social ownership of capital and land.
The Spiritual School. The novelists of the early Victorian era did much to condemn laissez-faire by their descriptions of contemporary conditions. Disraeli, Mrs. Gaskell, and Charlotte Bronte depicted in strong colours the life and environment of the new factory towns, but their influence was small compared with that of Dickens. Dickens came to authorship along the road of poverty and squalor. He knew intimately the seamy side of life, and had tasted the fruits of a system based on unbridled self-interest. Hence, though devoid of any big constructive ideas for reform or reconstruction, he stood forth as the enemy of selfishness and hypocrisy, whether in men or in a system. Selfishness in men is personified in Scrooge of the “Christmas Carol''; in a system in “Hard Times” (1854). In this novel Dickens paints Thomas Gradgrind, the type of the age and its philosophy, free from any conventional vices, but hard, stern, and self-centred in his business dealings. To Gradgrind “business is business,” something in which there is no room for ethics or a soul, something which gives the successful man the whole world, but fails to develop in him those qualities which make men great or lovable. By way of contrast, Dickens gives us pictures of a man and woman, poor and ignorant of the commercial value of self-interest, but full of the milk of human kindness, happy in spite of their poverty, and guided by sacrifice rather than selfishness. The moral of the story is that there is far more in mankind than the desire for individual gain; affections, desires, the sense of duty and service, all count, and individualism is bad as a theory of life because it takes no account of these human traits. Life cannot be controlled by material laws of supply and demand; happiness cannot be estimated in terms of money. “Sullen socialismo was Macaulay's opinion of this moral, but there was very little socialism in Dickens. He merely protested against the prevailing doctrine, and in his small way helped to achieve a reform here and there. His pictures of the debtors' prison, the private school, Bumbledom, public executions, and the Court of Chancery drove public opinion to remedy the faults described. But Dickens' message was spiritual rather than material, and his great thesis was that selfishness warped men, and brought misery to the mass of mankind.
The Christian Socialists. The general awakening of the social conscience about 1848 influenced many religious leaders in different parts of Europe, and brought into being the Christian Socialist school. This school declared that Christianity had a distinct message to men here on earth, that its tenets must be applied to social and economic life, and that the Kingdom of God must be realized in this life, instead of being postponed to some distant future state. The Christian Socialists laid stress on texts which had been passed over by the individualists, and found in the Bible material for the condemnation of capitalist society as it then existed. But, nevertheless, they were not socialists, either in the contemporary or present meaning of the word. When they turned to suggesting remedies, they urged the establishment of small self-governing workshops; but they laid more stress on the need for better character than for a different social system. They refused to believe that a change in material conditions or environment alone would bring social justice or happiness. The individual must also be changed, and a sense of unselfish brotherhood fostered. As Charles Kingsley, one of their leaders, remarked, “The only thing to regenerate the world is not more of any system, good or bad, but simply more of the spirit of God.”' Kingsley, like many of his fellows, was intensely interested in practical reforms. He advocated better housing conditions, supported trade unionism and co-operation, and helped to establish self-governing workshops. (See Chapter XXVII.) Although this particular experiment failed, the group helped to rouse many clergy and laity to a sense of social responsibilities, and Christian Socialism has always had a fair following in the churches of Europe since the preachings of the fifties.