VARIOUS causes have been assigned for the present commercial depression. Stump speakers during the late political campaign presented startling pictures of Western grain bins bursting with wheat, while there were millions of laborers unemployed, and therefore unable to earn their daily bread, on account of a woful lack of greenbacks. Specie resumptionists, on the other hand, have maintained that the cause of all the trouble was the great abundance of greenbacks.
Another class of writers claim that the distress is owing solely to the late civil war and the measures taken to carry it on, the passage of the legal-tender act, the inflation of prices, the disbandment of the army.
Still another class find the prime cause of all present disturbance in invention and the substitution of machinery for muscular labor.
It is certain that a lack of greenbacks and the great abundance of them cannot both be first causes; and it is clear that there must be some other cause, for the distress is sharper in England, where there are no greenbacks, than in this country. It is apparent, also, that the trouble is not due wholly to the war measures, for while there has been civil war in the United States, there has been peace in England. If the use of machinery is the cause of all the trouble, how happens it that in China, India, Japan, Brazil, and Australia, where there is little or no machinery, there should be the same stagnation of trade and quite as much distress?
The distress being universal, there must be causes world-wide in their effeets; and, moreover, this commercial disturbance has been distinguished from all others that have preceded it by its breadth and prolongation.
With the beginning of the present century there was the beginning of a new civilization through the employment of the forces of nature, which up to that period had been dormant. Rivers had turned mills for grinding corn and sawing lumber, but now they were set to doing work which in all former periods had been done by human hands. The coal deposits had been lying in their subterranean beds from the primeval ages, but thenceforth this “ stored-up sunlight ” was to take the place of muscular power. This employment of the forces of nature brought about a change in social conditions. In all past ages men had labored singly, but from that time on they were to work collectively, organized and directed by one individual, as a general marshals an army, with astonishing results, as we shall presently see. This employment of the forces of nature and concentration of laborers has not only brought about a change in social conditions, but has given rise to questions the solution of which will be vital to the well-being of society.
Under this new order of things we have organizations known as trades unions, labor leagues, labor reformers, socialists, communists, which claim that the laborer is in a condition far worse than at any time in the past; that the use of machinery throws men out of employment; that capital is oppressive; that the rich are growing richer, and the poor poorer; that the cause of the present distress is gely due to the power of capital over labor; that as things are now, labor is at the mercy of capital; that interest on money is robbery; that labor has done pretty much all that has been done; that there is a natural antagonism between labor and capital, with other assertions that remain to be proved.
Various are the demands for relief at the hands of government. The demand is made for a reduction of the hours of labor; for the abolition of the patent laws, on the ground that patents are monopolies; for a discontinuance of convict labor, upon the plea that the employment of criminals by the state is an injustice to honest laborers. Petitions are sent to Congress for the construction of a railway from New York to Omaha, and for the reconstruction of the levees of the Mississippi, the chief argument for such action being the employment of the unemployed. A bill recently advocated in the house of representatives made provision for the removal of the unemployed of the cities to the unoccupied lands of the frontier, and for the erection of houses, the government giving the emigrants land, advancing money, and holding a mortgage on the property. Socialists and communists demand the enactment of laws limiting the amount of property that an individual may acquire, and the division and distribution of what has already been acquired.
In order to ascertain whether laborers are worse off to-day than in the past, let us see what they had in the past; and as it is claimed that the use of machinery has caused much of the distress, we will refer to the most authentic data to ascertain what the havings were before the introduction of mechanisms. We will limit our view to a time when Boston, New York, Albany, and Philadelphia were considerable towns.
The first power loom was set up in Waltham, in 1816. At that time nearly all the clothing and much of the cloth used in household furnishing was manufactured upon the household spinning-wheel and loom. Many a weary day was spent by housewives at the loom, and by maidens at the spinning-wheel, preparing sheets, towels, and articles for personal use. A maiden, to obtain her marriage “outfit,”must first card the cotton or wool into rolls; then came the spinning, and during ten hours’ labor she could spin three and eight tenths miles of thread, but would be compelled to walk nearly six miles in doing it. She must toil day after day, month after month, and year after year, to procure linen enough to begin housekeeping. In contrast, we now see, in our manufactories, a girl sitting at her ease, or leisurely walking to and fro, minding the automatic working of a machine that produces in ten hours twenty-one hundred miles of thread; and a young lady preparing to engage in housekeeping may purchase a sheet for about seventy-five cents.
The development in the manufacture of textiles was so rapid that the spinning-wheel of the household was consigned to the garret about 1830, thenceforth to be regarded as a curiosity, to be brought out only in aid of church fairs, or on centennial anniversaries.
We may take 1830 as the beginning of the new order of things in this country, for at that period there were but twenty-nine miles of railroad in operation, against eight-one thousand at the present time. The new civilization, therefore, is mainly the outgrowth of half a century. Fifty years ago a citizen journeying in the public stage traveled seventy-five miles a day, whereas now he is whirled forty miles an hour. Then the stageman was the mail carrier, and a merchant of Boston writing to New York could not expect a reply to his missive in less than six days; in contrast, the broker of Wall Street, the pork packer of Chicago, the cotton factor of New Orleans, every business man of the country, regulates his affairs now by the hourly reports from every great commercial centre of the world.
A half century ago, a large part of the people of the United States lived in houses unpainted, unplastered, and utterly devoid of adornment. A well-fed fire in the yawning chasm of a huge chimney gave partial warmth to a single room, and it was a common remark that the inmates were roasting one side, while freezing the other; in contrast, a majority of the people of the older States now live in houses that are clapboarded, painted, blinded, and comfortably warmed. Then, the household furniture consisted of a few plain chairs, a plain table, a bedstead made by the village carpenter. Carpets there were none. To-day, few are the homes, in city or country, that do not contain a carpet of some sort, while the average laborer by a week’s work may earn enough to enable him to repose at night upon a spring bed.
Fifty years ago, the kitchen “ dressers ” were set forth with a shining row of pewter plates. The farmer ate with a buck-handled knife and an iron or pewter spoon, but the advancing civilization has sent the plates and spoons to the melting pot, while the knives and forks have given place to nickel or silver plated cutlery.
In those days the utensils for cooking were a dinner-pot, tea-kettle, skillet, Dutch oven, and frying-pan; to-day there is no end of kitchen furniture.
The people of 1830 sat in the evening in the glowing light of a pitch-knot fire, or read their weekly newspapers by the flickering light of a “ tallow dip; ” now, in city and village, their apartments are bright with the flame of the gas jet or the softer radiance of kerosene. Then, if the fire went out upon the hearth, it was rekindled by a coal from a neighboring hearth, or by flint, steel, and tinder. Those who indulged in pipes and cigars could light them only by some hearthstone; to-day we light fire and pipes by the dormant fire-works in the match safe, at a cost of one hundredth of a cent.
In those days we guessed the hour of noon, or ascertained it by the creeping of the sunlight up to the “ noon mark ” drawn upon the floor; only the well-to-do could afford a clock. To-day who does not carry a watch? and as for clocks, you may purchase them at wholesale, by the cart-load, at sixty-two cents apiece.
Fifty years ago, how many dwellings were adorned with pictures? How many are there now that do not display a print, engraving, cliromo, or lithograph? How many pianos or parlor organs were there then? Reed organs were not invented till 1840, and now they are in every village.
Some who may read this article will remember that in 1830 the Bible, the almanac, and the few text-books used in school were almost the only volumes of the household. The dictionary was a volume four inches square and an inch and a half in thickness. In some of the country villages a few public-spirited men had gathered libraries containing from three to five hundred volumes; in contrast, the public libraries of the present, containing more than ten thousand volumes, have an aggregate of 10,650,000 volumes, not including the Sunday-school and private libraries of the country. It is estimated that altogether the number of volumes accessible to the public is not less than 20,000,000! Of Webster’s and Worcester’s dictionaries, it may be said that enough have been published to supply one to every one hundred inhabitants of the United States.
THE ORGANIZATION OF LABOR.
This glance at the past shows us the havings of the people, of laborers and capitalists alike, at the time when machinery was introduced. With the invention of machinery for the manufacture of textile fabrics, there came of necessity an organization of labor. Men and women, instead of working for themselves, sold their services to employers, subjected themselves to rigid rules, and worked in masses. From the settlement of the country up to that time, manual labor had depended solely on itself, and had made but little progress. In the factory men gave up, to a certain extent, their individuality, and consented to labor as others should direct. There was also of necessity an association of capital. Prior to that time the farmer, the blacksmith, the carpenter, hired laborers during summer, and turned them adrift in winter. Journeymen in the different industries were ever being crowded out by apprentices, but the factory employed no apprentices, and gave employment through the year. What were the first effects of this association of capital and organization of labor? Better wages, the cost of production cheapened, steady employment, the laws of demand and supply brought into active operation.
Did this introduction of machinery, organization of labor, and association of capital throw men out of employment? On the contrary, it created a great demand for labor, with a great increase of wages. In 1830 women at work in households, making butter and cheese, spinning and weaving, could command but fifty cents a week, with board, while in the Lowell manufactories their net earnings were from two to three dollars per week. More was earned by the daughter in the factory than by the father upon the farm, and many a homestead mortgage was lifted by her savings.
Let us examine this question more minutely.
The man who started the ball was the inventor who contrived the machines; but the inventor, being a poor man, could not introduce his mechanism to the public until he called to his aid men who by thrift and enterprise had accumulated wealth.
HOW CAPITAL EMPLOYS LABOR.
The capitalist in turn called to his aid the entire fraternity of trades and occupations, a host of skilled and unskilled artisans and laborers, men who should use their muscles and brains as the capitalist should direct, in rearing the building and constructing the machinery. Long before it was possible for the capitalist to receive a dollar in return, his accumulations of tlie past were scattered broadcast over the land, and all for the benefit of labor. He called for men of a high order of intelligence and executive ability, after the building was erected, to be superintendents, overseers, engineers, clerks, accountants, inventors, chemists, dyers. What were these men doing, and where were they? On the farm, in the workshop, behind the counter of some country store, doing ordinary work, but endowed with power and capacity to do something higher and better. Then, when the machinery was in place, the capitalist summoned the farmers’ daughters and the women who were out at service, weaving with the hand-loom, to lay it aside, to do more work with the looms driven by the Merrimack. Nor did the movement stop there. This calling of laborers into new industries had its effect upon those who remained upon the farm and in the workshop by increasing the value of their labor. Hands upon the farm who had been receiving eight dollars per month through the increased demand for labor soon obtained ten and twelve; the girls who bad worked for fifty cents a week demanded one dollar for doing the same work.
While on the one hand there was a general advance in wages, on the other there was a general cheapening in the cost of manufactured goods; the cotton prints sold at the present time for five cents a yard are far superior to those that formerly commanded twenty to forty cents, and “homespun” woolens which before the introduction of machinery were sold at one dollar a yard would be dear now at fifty cents.
Through invention and the employment of the forces of nature, one person does the work of many. It is asserted by cotton manufacturers that by the use of machinery a man may accomplish one thousand fold more work than he could by the hand wheel and loom in use at the beginning of the century. It is estimated that the number of persons engaged directly in cotton manufacture throughout the world is from 1,100,000 to 1,300,000. If we assume that the population of the globe is 1,400,000,000, it follows that the work now done by the operatives in the cotton manufacture would require the labor of every human being on the earth, if forced to use the methods of former days.
What is the inference? The cotton cloth annually manufactured is about 10,000,000,000 yards. It is evident that only a small portion of that amount could be furnished by the spinning-wheel and loom; that in consequence there would be less demand for raw material, less demand for labor in its cultivation, less acreage in cotton, less clothing worn, fewer comforts of life, with a multitude now employed thrown out of employment.
We have seen that to introduce machinery men were called from the farm and workshop, and that there was a new demand for labor, and now we see that if machinery were to come to a stand-still not only the operatives would be thrown out of employment, but the agricultural laborers as well. It is the stopping of machinery rather than its introduction that throws men out of employment, and that is just what has happened. Why the machinery stopped is another matter, upon which I shall have something to say farther on.
Before the invention of the cotton-gin, the seeds of cotton were separated from the fibre by hand; only about four pounds of fibre per day could thus be prepared by muscular labor, whereas the amount cleaned by a gin is about four thousand pounds per day. As the crop last year aggregated about 2,100,000,000 pounds, it is plain that if cleaned by hand it would have required 505,000,000 days’ work, yet it. was cleaned by 1000 machines, working through ihe year; the difference in cost being about $500,000 against $500,000,000!
No argument is needed to show that such an amount could not have been produced under the old method. From this presentation we see that by employing the forces of nature we may with mechanism use the materials of nature as it would not be possible for us to do by muscular effort for the supplying of our wants; that, practically, there is no limitation to the gratification of our desires; that in this unlimited gratification we administer to our comfort, well-being, and happiness.
The growth of the manufacture of cotton will be seen by the following exhibit: —
SPINDLES IN THE UNITED STATES.
1882 ...... 1,200,000
1845. . . . . . 2,500,000
1875. . . . . 9,500,000
IN GREAT BRITAIN.
1832 .... 9,000,000
1315 . . . 17,500,000
1875 .... 37,500,000
1832 . 2,800,000
1875 ...... 19,500,000
For a half century an army of laborers has been employed in the construction of railroads. There are no data to show the millions of cubic yards of earth thrown up, nor the millions of tons of iron ore and coal consumed in the construction and maintenance of roads whose length exceeds 80,000 miles; nor the number of men employed. We can only give free scope to the imagination in thinking of the vast multitude wielding the pick and spade for a half century along the lines and in the mines; working in founderies, furnaces, rolling-mills, and machine-shops; building locomotives, cars, and the machinery used in their construction (engines, lathes; pinning, bolt, rivet, screw machines), — engineers, machinists, carpenters, joiners, painters, decorators, upholsterers, superintendents, overseers, architects, designers, mathematicians, draughtsmen, inventors, chemists, men of a high order of intellect in every branch of science and industry. From whence came they, and what, were they doing? They came from farms, workshops, and countingrooms; they were swinging the seythe, wielding the sledge, planing boards, or following some other occupations.
The development of manufactures and the construction of railroads called for such a vast number of laborers that we could not supply the demand, and we summoned them from other lands. I call attention to the fact that not till the beginning of manufacturing, not till we began to use machinery, was there any great amount of emigration to this country.
The statistics of emigration reach back to 1820, when the number of emigrants was between 7000 and 8000 per annum. By 1830 the number had increased to 23,000, in 1840 to 84,000, per annum. In 1845 there were but 4633 miles of railway in operation, but that year was marked by a new departure in railway construction. By 1850 the railway mileage had doubled, and the emigration had gone up to 369,000 per annum. In 1856 the mileage was 16,728, and the emigrants that year were 427,000, the largest number arriving in any year. Since 1820, more than 9,000,000 emigrants have arrived in this country. Whoever will take time to study the emigration statistics in connection with the use of machinery, the development of all our industries, will see that there is a remarkable correlation between the two; that the more machinery we had., the greater the demand for labor!
Undoubtedly our unoccupied lands called a large portion of the 9,000,000 to these shores, but aside from that, there was a demand for labor that could not be supplied by our own population, and there was at the same time a steady advance, as I shall show, in the prices paid for labor.
While this development was going on in this country, there was a corresponding movement in Great Britain and Europe, — a constant subtraction of agricultural and mechanical laborers, and an advance in wages, as on this side the Atlantic.
The withdrawal of such a large number of farm laborers in this country and in Europe, and the rise of wages, stimulated inventors to supply their place with machinery that should do the work of human hands upon the farm. In the harvest field a man with a cradle, in 1830, could cut from one to two acres per day, — quite as much as could be raked into “gavels” and bound by two other laborers. Mr. Obed Hussey, as early as 1833, patented a machine for reaping, but so crude the invention, so rude the machine, that it did not come into use before 1844, and in 1852 a committee of the New York Agricultural Society doubted if the machines would supersede the scythe in the hayfield, or the cradle in the harvesting of grain; but invention has gone on, till now the self-binding harvester dispenses altogether with human muscles in harvest. Never again will Boaz marshal his reapers, or a fair Ruth glean behind them; and those rural scenes of wliite-shirted harvesters bending to their work arc all of the past. Now the farmer drives his team afield, riding in his seat, cutting and binding the grain, —fifteen acres a day.
The development of the self-binding reaper is one of the marvels of the age. It was brought into use in 1874, when fifty tons of wire were manufactured for binding sheaves; in 1875, three hundred tons; 1876, twenty-eight hundred tons; 1877, sixty-five hundred tons ; 1878, fourteen thousand tons ! This last amount is quite as much as the total tons of wire manufactured in this country in 1860.
Besides tlie self-binding reaper, there is the California harvester, a machine that, on account of the rainless seasons in that State, can be used to advantage, propelled by sixteen mules, cutting off the heads of grain; mowing a swath twenty feet wide; threshing, winnowing, and feeding into bags, three men cutting and threshing and bagging fifty acres a day.
Before these inventions, the Western farmer, during harvest, was preyed upon by a class of men known as “ binders,” who began in June in Tennessee and Missouri, and moved northward to Minnesota as the grain ripened, making the farmer’s necessity their opportunity, demanding and obtaining from three to five dollars a day with board, materially reducing the profit of the crop to the owner. The farmer and his wife were slaves during the harvest season, and in consequence of this emancipation there was the spectacle, last season, in some of the grian-growing States, of the burning of farm machinery by the men who complain that by its use they have been thrown out of employment.
Now, does not the use of the self-binding reaper prevent those men from doing what they have been accustomed to do? Let us take another look before we settle down upon an ultimate conclusion. Did Mr. McCormick, or Mr. Osborne, or Mr. Wood, individually manufacture the reapers? On the contrary, they did not lift a chisel, or place their hand to a saw. They called upon the lumberman to supply them with lumber; the iron - master to supply them with iron; the miner to furnish coal. They set the entire brotherhood of mechanics to work; gave a stimulus to every branch of industry, and employment to hundreds of men, before the machines were sent to the harvest field. Their capital was scattered broadcast, like seed from the hands of the sower, over the entire field of industries. Is it not manifest that while one class of laborers are forced to do something besides binding wheat in the two months of harvest, another class of skilled laborers are employed, the year round, in manufacturing the machines? Do we not see that the ultimate benefit is beyond all calculation ? Cheap bread has ever been regarded as one of the greatest of blessings. The farmer, by dispensing with human muscles, by using a machine that will do the work of ten or twelve men, can afford to sell his grain more cheaply. He can still have a good margin of profit, and at the same time reduce the cost to the consumer. So it comes about that morning, noon, and night millions are sharers of the inestimable blessing of cheap bread. Is it the farmer alone who is thus cheapening our daily loaves? Shall we say that he alone brought $180,000,000 from England to this country last year for bread stuffs? Let us give honor and credit where they are due; let us not fail to see that had it not been for the brain labor of Hussey, McCormick, Wood, Osborne, and the great host of men whose names are enrolled in the archives of the patent office, but who are otherwise unknown, it would not have been possible for this country to have harvested more than one quarter or one third of the 360,000,000 bushels of wheat produced last year. Through their brain labor the world to-day has cheap bread. Harder than now would be the times, had they not brought the reaping machines to their present degree of perfection; sharper would be the distress in England, if they had not thus devoted their lives and employed their capital. It is not sentiment but literal truth to say that whenever the impoverished millions of Great Britain behold the sun sinking in the west, they think of it as throwing its departing beams over a land wide and fair, where there is an abundance of food for the famishing of the world, and only through failure of crop will bread ever be dear.
Telegraphy and photography were discoveries, but with those discoveries there followed a class of inventions that were generic in their nature. The Morse telegraph was brought into practical use in 1844, and had a rapid development. We have seen that up to 1830 a letter could be carried about seventy-five miles a day, and that the locomotive transmitted correspondence five hundred miles in twenty-four hours; but with the invention of the telegraph time was annihilated. The telephone has now come to our aid, and we may converse with our friends far away as freely as if they were present.
The construction of telegraph lines, and the establishment of an office in every village, brought about another levy upon the labor of men and women who were doing something else; but far beyond this has been the effect of Morse’s invention. It has revolutionized methods in business. The merchant, broker, manufacturer, is not now compelled to wait weeks or months before deciding upon a course of action in trade, but be does it on the instant. He is not forced to wait months, or may be a year, before be can turn over his capital and count up his gains; he may do it in an hour. It is manifest that through the use of the telegraph there has been a vast augmentation of the power of capital.
Photography has not been productive of any corresponding change, but its development has called many thousands from other occupations; has given a great stimulus to other industries, affecting even the egg markets of the world, enhancing the value of every barn-yard fowl in Christendom by the incessant demand for albumen. This discovery has widened the employments open to women, calling them from lower to higher occupations, with an increase of wages.
In connection, I may mention the development of the india-rubber and guttapercha industries, invention and discovery calling another multitude from some other occupation, and giving a stimulus to labor in far-off lands.
THE REPRODUCTIVE POWER OF INVENTION
When the first rude locomotive was brought from England to the United States, there was not a machine-shop in the country that could have constructed one like it, and American mechanics were compelled to direct their attention to the invention and construction of machines to make machines. After Goodyear discovered the process by which india rubber could be vulcanized, inventors were obliged to construct machines for its manipulation, and those in turn required other inventions and devices. Like seed corn reproducing itself a hundred fold, like yeast spores reaching out in every direction, the law of reproduction goes on, expanding and increasing the power of man to bring into use the forces and materials of nature for the welfare of his fellow-men.
The report of the census to most people is a dreary, bewildering mass of figures, but to one who studies the progress of the nation there can be no more interesting reading. As has already been shown, manufacturing prior to 1820 was wholly done in the household and by individual effort. Very little capital was invested even in 1830, but in the census of 1870 we ascertain that there were 2,053,000 persons directly engaged in manufacturing, whose annual wages amounted to $775,584,000 ; that the capital invested aggregated $21,018,000,000; that the annual product had a value of more than $4,200,000,000. In contrast, the wages of farm laborers, including board, were only $300,000,000, less than one half the amount earned by those engaged in manufacturing.
The development of manufacturing has been altogether disproportionate to the growth of population. Between 1850 and 1870 the population increased sixty-five per cent., while manufacturing increased three hundred and twenty-two per cent., and, notwithstanding the commercial depression of the last four years, it is confidently maintained by those who have made the industries a study that there has not been any material change in the ratio of increase.
THE FORCES OF NATURE.
The new civilization has its origin in the employment of the forces and materials of nature to do the work of human muscles. Before the beginning of manufacturing, there were coal and iron deposits beneath the Alleghanies as there had been from the primeval ages, and the rivers ran to the sea as they had ever run; but the time came when they were to be put in harness for the bepefit of the human race. In calculating the power of these forces of nature, James Watt used the term horse-power, representing the efforts of the strongest horses at short intervals as equivalent to the continuous raising of thirty-three thousand pounds at the rate of one foot a minute. With a steam-engine this amount of energy is accomplished by the evaporation of a cubic foot of water per hour, from a temperature of 60°, under a pressure of fifteen pounds to the square inch. After deducting all losses from friction, this power is estimated to be equal to the labor of six men, and this six-men power is obtained by burning about six pounds of coal per hour. With coal at five dollars per ton, this force of nature does the work of six men for ten hours at a cost of about eighteen cents, or of one man for ten hours at a cost of three cents.
Is the employment of this force detrimental or beneficial to manual labor? The argument that would relegate machinery out of existence would likewise put a stop to the mining of coal, or the employment of water to turn mill-wheels. Is it not manifest, rather, that if we can set a hitherto idle force to work for us instead of using our own muscles, we are gainers thereby ? Is it not a using of the riches of nature for our comfort?
The first power loom was set up in 1816, since when capital has been adding machinery, until in 1875, in all industries in Massachusetts, there was in water wheels and steam engines power equivalent to that of 318,748 horses, equal to the labor of 1,912,000 men, or nearly 300,000 more than the entire population of the State. By the census of 1870, we learn that the power derived from the forces of nature in the United States in manufacturing was equal to the power of 2,343,000 horses, representing the muscular force of more than 14,000,000 men!
Some of us can recall the days when ponderous wagons, drawn by six and eight horses, were dragged from Vermont to Boston, along tire turnpikes. Those were the days when country taverns abounded, but now the highways, once so thronged with teams, are grassgrown and desolate.
Comes the noisy throng no more,
And the faded sign, complaining,
Swings unnoticed at the door.”
Dismal were the forebodings of the farmers when railroad construction began, — nevermore would they find a market for their grain, and horses would depreciate in value; but oats are still marketable, and horses salable.
According to the railway reports of Massachusetts, there were in use last year in that State 1030 locomotives. Mr. Edward Appleton, a competent engineer, estimates that the number in constant use — deducting those that are undergoing repairs—is 682, and that the work performed by them is equivalent to the power of 1,519,000 horses on common roads, whereas the number of horses in the State, by the census of 1875, was only 53,218. Applying Mr. Appleton’s formula to the number of locomotives in the United States, we find that the locomotives are doing the work of nearly 30,000,000 horses, whereas the aggregate horses of all ages in 1870 was less than 9,000,000.
We smile at the ideas of the men living a half century ago, who thought, when they were planning the first freight depot in Boston, for the use of the Boston and Worcester Railroad, that a building forty by sixty feet would accommodate the road for a quarter of a century! How little did they comprehend the power of steam as a force of nature to change human affairs! How little do we comprehend what it has done, or what it is yet to do!
We have seen that the new civilization has had its development through the united efforts of capital and labor, powerful when working harmoniously, but able to accomplish nothing separately. But what is capital? If this were a treatise on political economy, several pages would be needed to set forth the nature and functions of capital, but it will be sufficient here to say that capital is accumulated earnings, which when we put into a house, farm machine, or anything else material, we call fixed capital; when we have it in money, or its equivalent, we call it active. If once fixed, it is a permanency. As an individual, I may sell the house, but somebody’s labor is in the bricks and carpentry, and will be there forever, unless fire destroys it, and then it is annihilated.
ANNIHILATION OF CAPITAL.
Many of us indulge the illusion that if we could only once obtain property we could keep it, but I think that most men will agree that its preservation is quite as difficult as its attainment. By fire and flood capital disappears; moth and rustare agents for its destruction. Use destroys it: the machine wears out, and a new one must be obtained. Invention destroys it: stage-coaches were capital once, but the locomotive has superseded them; sickles and scythes were capital once, but now they are rusting in garrets. No manufacturer could afford to take as a gift to-day a cotton-mill equipped as in 1860; it would bankrupt the man who might undertake to run it, invention having rendered the machinery of twenty years ago utterly worthless.
“ We have rebuilt one of our furnaces five times since 1850,” was the remark of an iron manufacturer recently; “ not that it was worn out, but because invention has made such an advance that we could not afford to run it on the old methods.”
Fashion annihilates capital. A few years ago millions of dollars were invested in machinery for the manufacture of hoop-skirts, and thousands of men, women, and children earned their daily bread in their manufacture; but when the sex discarded crinoline, the fixed capital was annihilated and the operatives were compelled to seek other employment.
It is a law of nature that there can bo no progress without decay. Progress is eternal change. Nothing can prevent the destruction of accumulated earnings; it is the gnawing of the tooth of time, and the moment we invest our money which represents our accumulated earnings in anything material, it becomes a permanency, is subject to constant depreciation and ultimate extinction. The use of Bessemer steel has annihilated a large portion of the capital once invested in iron furnaces. The “ dead past ” is a comprehensive term, and sooner or later we, with all our accumulations of material wealth, go back to the dust from whence we came.
What has become of the wealth of Rome, once so immense? How the fire whiffs out riches — one hundred millions per annum in this country!—so much labor annihilated. How the war swept it away! And yet, notwithstanding the ravages of war, the devastation by fire and flood, the extinction by new invention, the accumulations have been marvelous. Want of space will not permit the giving of details, but it can be shown that the earnings of labor and capital together, invested in savings-banks,general banking, insurance, railroads, national, state, and municipal securities, aggregate at the present time not less than $13,000,000,000! The data for this estimate is at hand and reliable; much more trustworthy than the estimated general value of all property in the United States as given in the census, which is placed at $30,068,000,000.
While these accumulations have been going on in this country, there has been a corresponding increase in other lands, and Mr. Gladstone is reported as saying that the development of the present century is greater than that from the time of Julius Cæsar to 1800.
PROGRESS OF THREE NATIONS.
The volume of trade is a fair indication of the progress of a people, and the following exhibit shows how Great Britain, France, and the United States have respectively advanced since the coming in of the new civilization. The presentation is by decades.
1827-37 Imports and Exports $4,948,750,000 1837-47 .... 6,771,555,000
1847-57 .... 11,065,280,000
1857-67 .... 20,379,890,000
1867-77 .... 28,879,205,000
1827-37 Imports and Exports $2,002,400,000 1837-47 .... 2,998,400,000
1847-57 .... 4,601,800,000
1857-67 . . . 9,261,200,100
1867-77 . .. 13,313,600,000
1827-37 Imports and Exports $2,006,218,000 1837-47 .... 2,285,428,000
1847-57 ... . 4,255,074,000
1857-67 . . 7,103,309,000
1867-77 • • 11,016,805,000
Great Britain has increased her trade six times, France six and one half, the United States five and one half. Is it probable that there would have been any such increase if the forces of nature had not been brought into play? But the forces of nature and the use of machinery have not been the only factors.
Coöperating with these forces of nature there has been what is felicitously termed a force of human nature, the confidence of men in their fellow-men.1 In commerce it is called credit. I write a promise to pay, and my neighbor, having faith in my ability to meet my promise, loans me money. He does not need the money in business, and is willing that I should use it on paying him interest. A laborer, earning more than he needs for his daily living, promises to pay, and men having faith in him supply him with money to build a house, or start in business for himself. A country trader from Illinois purchases goods in New York, giving his promise to pay, and the New York merchant, needing money, obtains it on this promise by putting his name on the paper. It comes about that eo can make that which does not exist as available as that which does exist, as long as we can meet our promises; but, failing in that, it is like a phantom that eludes our grasp. It may serve all the purposes of gold and silver to-day, and to-morrow be utterly valueless.
Under the new civilization, through the agency of the railroad in supplying quick transportation, and through the telegraph, in flashing a message from New York to California in a few moments, a promise to pay given in New York may be just as potent in San Francisco, for the purposes of trade, as gold would be. The transfer of the gold, the time and cost, all are saved. Very little money is used in these days in commerce; checks and drafts and notes serve in nearly all commercial transactions. The confidence of man in man, and the ease with which we can make a promise to pay serve the purposes of gold and silver, ever lead men on, in the pursuit of wealth, to take tempting risks, to promise more than they can perform.
This tendency is universal, and just as manifest in the Parsees and Hindoos, in the Chinese and Japanese, as in the people of Europe, Great Britain, or the United States. In every country credit answers all the purposes of capital, as long as men meet their promises; and in all countries, when men fail in that, there will be instant distrust.
In 1830 the amount of bank-notes and specie in circulation in this country was under six dollars per capita of population. There had been no great increase of the precious metals for many years. The mines of Mexico and Peru still yielded silver and gold, as they had for three centuries, but in 1810 came the discovery of gold in California, then in Australia, together with the opening up of the argentiferous deposits of Nevada, Colorado, New Mexico, Arizona, Idaho, and Montana. The vast production of what in every age has been accepted as the representative of wealth in a short time brought about a universal change of values. The price of a day’s labor, the product of labor, the value of all material things, began to change the world over.
I do not say that the rise added anything to the real wealth; labor alone does that; the change was relative, but it had the effect of stimulating men, in the race for riches, to make larger promises than they could keep. In all countries there was a mania for speculation.
In this country, in 1860, there came the outbreak of civil war, followed by the issue by the government of several billions of promises to pay, not to mention the promises issued by States, municipalities, banking institutions, and individuals. Labor and capital and machinery were producing largely, but the real wealth was becoming fixed capital in railroads, manufactories, buildings of all kinds; and it was disappearing in the waste of war. Never before in the world’s history had there been such a rapid accumulation of wealth; never before had the products of labor been so rapidly transformed into fixed capital, or annihilated by war and the progress of invention. In the rise of values, in the wish to accumulate wealth, we mortgaged our prospective earnings for a long period of years. The circulation of greenbacks and national bank-notes advanced from less than six dollars per capita in 1830 to more than eighteen per capita in 1876. We built railroads where they were not needed and from which we could not hope for any immediate returns, and for the time being the amount of capital thus invested became extinct; we laid out towns in the wilderness and marked up the house lots to fabulous prices, upon which we issued promises to pay; multitudes, instead of producing, gave their attention to creating fictitious values, upon which they issued more promises to pay; the nation, States, counties, towns, corporations, societies, churches, individuals, all issued promises to pay. A piece of land which before the construction of a railroad was utterly valueless was sold perhaps a dozen times, each purchaser giving his promise to pay. We bought pictures, horses, hooks, pianos, things delightful to have, and paid for them in promises to pay, but they were all unproductive fixed capital.
So long as we could meet our notes by issuing more promises, there was fair sailing, and we all congratulated ourselves upon the good times we were having, flattering ourselves that we were getting rich, losing sight of the fact that everything in the universe is under the domain of physical law, and that those laws which govern human progress and are powerful to build up arc equally powerful to destroy. But there came a day when a firm that had issued many bonds found itself unable to meet its promises, and society, which had been one grand mutual confidence association, was seized with a panic. Our neighbors asked us to secure our notes ; we asked them to secure theirs; and we all discovered that what we thought good security was worthless. Machinery stopped, because there were no buyers for manufactured goods; the laborer was thrown out of employment and the capitalist into bankruptcy. The laborers who had lived up to the limit of their earnings were distressed; those who had saved their earnings and invested in houses and lands, which had been marked up in value, who had paid in part, saw their property disappear “ like the baseless fabric of a vision.” Then came the clearing away of the wreck, the stern decrees of the courts of insolvency, the wiping out of the fictitious, the breaking up of happy homes, a looking about to find some employment where men might earn their daily bread. It is one of the saddest pictures of the nineteenth century. It is not local, from the fact that the causes were not local, but universal. Their origin lies far back in the forces of nature and of human nature, — in the powers of the new civilization, I would not be understood as maintaining that the war had nothing to do with the present trouble: it had its effect, for it stimulated cotton culture in India, Egypt, and South America; it stopped the machinery of Lancashire, and started it again, with a great addition of looms; it set founderies and furnaces in blast in Great Britain and in this country; it swept American commerce from the ocean, and contributed to make Great Britain the world’s carrier, manufacturer, and banker. The surrender at Appomattox was felt in every commercial centre, in every banking house in the world ; but it is morally certain that if there had been no war in this country there would have been, sooner or later, a commercial disturbance the world over, with distress everywhere. The present trouble has been brought about through a disregard of the physical laws that underlie progress. There has been commercial stagnation at other periods in the past, as there will be in the future, but it is not probable that for many years there will be a depression so prolonged, intense, and universal as that which began in this country in 1873, and which is now so severe in other lands, for like conditions will not exist in the immediate future.
THE FAILINGS OF LABOR.
Amid the wreck and ruin, there are complaints that the rich are growing richer and the poor poorer; that the laborer has a harder time than ever before. At the beginning of this article I contrasted the havings of the present and past; now let us glance at the earnings of laborers. Without perplexing the reader with long columns of figures, I will simply state the results, as set forth most conclusively in the late report of Colonel Carroll D. Wright, chief of the Massachusetts Bureau of Statistics, in which he shows that while the average cost of living has advanced fourteen per cent. since 1860, the wages of operatives have advanced twentyfour per cent.
I may further say that the books of a manufacturing company in New Jersey, that supplies its operatives with goods at cost, show that in all the staple articles of food the cost of living at the present time is lower than in 1860.
PAUPERISM AND CRIME.
It is stated that pauperism is on the increase; that the use of machinery drives men out of employment, and that not being able to obtain work they are reduced to beggary. Unfortunately, there are few reliable data upon this point in the United States, but in no other country is there so much machinery used as in Great Britain, and there we have authentic data.
In 1863 the population of England and Wales was 20,590,356; the number of persons relieved, 1,142,624; the amount of relief, £6,527,036; in contrast, the population in 1878 was 24,854,397; the number of persons relieved, 742,703; and the amount of relief, £7,400,966. The percentage of population receiving relief in 1863 was 5.55; in 1878 it was 3.06, showing that with the great increase of machinery there was a great reduction in the number of persons relieved.
In connection, let us notice one other important fact: the amount paid per individual in 1863 was $28.50, while in 1878 it was $49.50. It is evident that this difference does not arise from any corresponding increase in the price of provisions; may we not infer that it does arise from an increase of the articles now regarded as necessary to human comfort? Mr. Bonamy Price states that it costs to maintain 1000 poor in London five times as much as it did in 1815 (Political Economy, page 237); that this increase of cost is due, in part, to the popular estimate of what is needful for human comfort. We see the same popular estimate here in the cost of erecting and maintaining our penal, reformatory, and charitable institutions. It is stated that by the use of machinery men become poverty-stricken, and so are led into crime; but the statistics of Great Britain show the reverse (Blue Book, 1878). In l862 the total commitments of criminals for trial in the United King dom were 30,291, while in 1876, with an increase of 4,365,000 population, the commitments were only 22,937. The de crease was nearly uniform in England, Ireland, and Scotland. What shall we infer from this, — that justice is not so vigilant now as in 1862, or that from some cause there is less crime? Manifestly the latter.
From this review we arrive at the following conclusions: —
(1.) That the havings of to-day are far greater than in the past.
(2.) That the earnings of the present are greater than in 1860.
(3.) That the cost of articles that enter into living has not advanced in proportion to our earnings.
(4.) That the mass of the people are better fed, clothed, housed, and in possession of more of the comforts of life, than at any other period.
(5.) That the change has been brought about by the development of the forces of nature through discovery, invention, the use of machinery, and the harmonious working of capital and labor.
(6.) That capital and labor, instead of being antagonistic, arc naturally helpful, and that any conflict between them is brought about by elements beyond the control of either acting separately.
(7.) That there are three such elements,— discovery, invention, and fashion.
(8.) That the laws of progress will ever require a readjustment of labor; that men will ever be forced to abandon old and seek new occupations.
(9.) That every advance in invention will demand a higher degree of intelligence, requiring a higher education.
(10.) That men must accommodate themselves to the laws of progress, or be crushed by them.
Let me not be misunderstood. No legislative enactment can alter or amend the laws which underlie progress any more than they can protect the man who happens to stand in the path of the thunderbolt. I assert with emphasis that under those laws labor will ever be compelled to seek new occupation, while capital will ever be annihilated. They are beneficent laws. The fire that burns up my hard earnings is the fire that drives the engine that enables me to accumulate earnings. The water that turns my mill sweeps it away. The power that builds is the power that destroys, and I must accommodate myself to it.
(11.) That under those laws there has been a general diffusion of wealth; that while the rich may be growing richer, the poor are not necessarily growing poorer.
(12.) That commercial disaster may come in the future as it has in the past.
(13.) That the popular estimate of what is needful for human comfort is higher to-day than in the past.
(14.) That though under the use of machinery men may be compelled to seek other occupations, each invention enlarges the sphere of labor.
(15.) That pauperism and crime, instead of being on the increase, are on the decrease.
(16.) That the human race, through the employment of the forces of nature, is moving ever on to a higher plane of civilization.
Charles Carleton Coffin.
- Economics ; or, The Science of Wealth. Page 90.↩