The Abolition of Poverty

IN 1839, George Ticknor could write to Miss Edgeworth from Boston: “In this town of eighty thousand inhabitants, or, with the suburban towns, one hundred and twenty thousand, . . . there is no visible poverty, little gross ignorance, and little crime.” Is there to-day a town of twenty thousand inhabitants in the United States of which this can be said? Poverty has grown rank and flowered into ignorance and crime in our hot-beds of civilization. The three great forces which the practical man recognizes, the state, the church, the rich, have been apparently almost powerless against this primal curse of poverty. And they are so.

The state is as old as civilization, but it has never destroyed want. By grinding and ill-judged taxation, by frantically foolish attempts at what is miscalled “ protection,” it has often made its people poor. The state that makes its people rich is one of the fruits of the far-off future. And yet the state can do something now. We have heard too much of the gospel of laissez-faire — that political gospel which makes the policeman the sole representative of government — which finds its prophet in young Herbert Spencer. Its disciples still con the books which Spencer’s riper thought has contradicted and disowned. They would leave the miner unprotected from the death that hovers around him in the firedamp, the farmer unaided in his hopeless struggle with the railroad, the child to sink under twelve hours of daily labor in the factory. They would close the postoffice and shut the public school. When the merchants of France, in reply to Colbert’s questioning how he could best serve their interests, said, “ Let us alone,” they voiced their needs correctly enough, but not those of the many. The clerk, the mechanic, the seamstress, the unskilled laborer, the child, ought not to be let alone.

The state should enforce universal education. This is the corollary of universal taxation for school purposes. The common conception of compulsory education as “an outrage upon the rights of the parent ” is not sentiment, but sentimentality.

A rigid building law, so framed and enforced as to prevent the curse of overcrowded tenement houses, has, I am informed reduced the volume of crime in certain quarters of London and Glasgow fully sixty per cent. within six years. It has not done this by reducing the population. Sir Sydney Waterlow’s company for the construction of model tenements, a company formed and managed for pecuniary profit, has proved that one hundred and fifty people can be comfortably housed on the land covered by an ordinary building in which one hundred tenants have slowly rotted to death, dying morally some time before they died physically.

The land laws of the French Revolution transformed millions of serfs into millions of farmers, and multiplied tenfold the aggregate comfort of France. The strongest nation in Europe to-day owes its strength to the laws which Stein and Hardenberg modeled after those of France.

In such ways, the state can do much. But this “ much " is comparatively little. Far more remains to be done.

The church is of even less use in the warfare against the primal curse of poverty. The church, in some form or other, is older than civilization. It dates from the day when the first two savages trembled before the thunder, or adored the sun. Yet it has never pulled up poverty by the roots. Through the Middle Ages, the church was a gigantic machine for the unproductive consumption of wealth. While famine palsied the hands of the workman, the dead hands of monastic orders clutched hill and valley by the mile. The church of to-day, in all its myriad forms, Roman, Hebrew, Liberal, Protestant, is wiser, better, kindlier. It comforts many a sorrowful soul. It sometimes builds a hospital, sometimes supports a school. If, in the latter, it teaches spelling and sectarianism, shall we not be grateful, at any rate, for the spelling? Yet, if we take the church now, look at the half-filled pews that cluster under the mortgaged roofs, reckon the mighty array of clergy, and then think of what the money, time, and effort spent here might do elsewhere, we may fancy that the era of unproductive consumption by ecclesiastics has not quite passed by. As far as the prevention of poverty is concerned, a hundred thousand dollars’ worth of model tenements may be safely expected to do far more than two hundred thousand dollars’ worth of church edifices.

The rich cannot destroy poverty; they can do a little towards it. I am about to try to show some of them how this little can be done. It is not to be done by alms-giving. Casual charity cannot destroy poverty; it. multiplies it. a thousand fold. Systematic charity, too, pauperizes the multitude, unless administered with a wise hard-heartedness that few of us are strong enough, unselfish enough, to maintain. All alms-giving that does not help the recipient to help himself is, save in the case of the incurably sick, a curse.

The three great recognized forces of modern society thus seem unable to cope with poverty. They cannot, at least they do not, give the poor that comfort without which life is not worth the living, and death is more than worth the dying. Salvation must be sought elsewhere. The poor can be saved from poverty only by the poor. Not by praying for sudden wealth; not by entreating government to give them work, or to surround the country with a Chinese wall of protected pig-iron and protected clothing and protected everything else that the poor man buys and the rich man sells, — it is not in these ways that the poor are to throw off their incubus.

The poor must save themselves. They must Coöperate.

I asked Charles Bradlaugh, some years ago, whether he thought that coöperation had been a substantial success in England. He said, “ I know it has. Distributive coöperation has brought comfort to thousands of families. Productive coöperation is still in its infancy, but we have great hopes of it.” The facts which impressed Mr. Bradlaugh so strongly are open to anybody who can spend a few months in England and content himself with studying the present rather than the past. To the believer in coöperation, the centre of England is near Manchester, and London is but an outlying suburb of Rochdale. It was my privilege to make a coöperative pilgrimage with a friend through parts of Germany and England, some five years ago. The shrines at which we worshiped were usually plain, not to say ugly, piles of brick or stone, and the sacred relics which we sought at every shrine were facts. Some of these latter, brought from England, afford the main material of the following pages.

In 1842, twenty-eight weavers formed the Rochdale Equitable Pioneers’ Society. Their poverty was such that each could pay but four cents a week into the capital fund. It took them two years to accumulate $140. One December evening in 1844, Toad Lane, a narrow, winding street of Rochdale, was crowded with a hooting rabble, drawn together to see the opening of the weavers’ shop. When the dingy shutters of the dingy little room were taken down, the mob screamed with laughter at the sight of the almost empty shelves within. As the twenty-eight weavers, the only customers, came out with their scanty purchases, they were met with taunts and jeers. Nobody jeers at the weavers’ shop now.

We spent an afternoon in going through the building. Its top floor is a plainly but comfortably furnished hall, where monthly meetings are held, lectures are delivered, and parties given. Below are the committee-rooms, the reading-room, and the library. This last contains ten thousand volumes. The battered, wellworn, dog-eared books in it are by no means all novels. Many of them, perhaps the majority, are works on the natural sciences, technical trades, travel, or history. The reading-room is large, well lighted, and comfortable. It contains all the leading periodicals, with a collection of scientific instruments which can be hired for a penny or two a night by members of the society who wish to entertain or instruct themselves or their friends. We were told that it is quite common for an artisan to give a small party at which the main attraction is a display of some simple scientific experiments. On the three lower floors of the building are stores where a man can buy clothing for his family and himself, boots and shoes, meat, vegetables, and groceries, watches and clocks, books, coal to warm his house, and the house itself, —for the society is now building homes for its members.

And all this is but the central store. There are many branch establishments in other parts of the town, among them thirteen groceries, eleven butcher shops, and eleven reading-rooms. The society also manufactures tobacco on its own account, has heavy interests in corn, cotton, and woolen mills, and manages a great savings-bank.

The Equitable Pioneers’ Society sells about $1,500,000 worth of goods every year, and declares quarterly dividends, or rebates on purchases, of from twelve to fifteen per cent. This is the result of the weavers’ shop in dingy, dirty, dark Toad Lane. From the beginning, the institution has been managed by men earning daily or weekly wages. They are no better, no wiser, no honester, than American workingmen. What is to hinder the latter from following their example, from gaining their success? 1

It is now ten years since some clerks in the London post-office found themselves unable to live on their pay. They asked for more, and were refused. The answer came on a foggy November afternoon, a day that was gloomy enough without bad tidings. Three of the men, talking over the dismal present and the dreary future, resolved to try what cooperation could do. They canvassed their fellows, and found a dozen who were willing to buy among them fifty pounds of tea. The money was paid in on the spot. The next morning, one of the original three, on his way to the office, bought at a wholesale store half a chest of tea. After office hours, the purchase was duly divided. The amount saved was twenty-five cents a pound. The story of this success speedily spread abroad. Within three days, the triumvirate had orders for another half chest. Soon they began to buy in somewhat larger quantities. They put the tea in an empty closet in the post-office, and hired the porter to weigh it out to the different purchasers, paying him for his trouble with the pound or so which each chest contained over its nominal weight. Little by little they added a few other staple articles to their stock. The old cupboard, their first store, was now too small. They hired a little room in the topmost story of a neighboring building for a few dollars a month. This was considered to be a most daring step. But their business speedily outgrew these narrow quarters. They were crowded out of room after room. Five years ago they moved into a building of their own, for which they paid $200,000. It is several stories high, with a frontage of perhaps a hundred feet on each of two streets; it. is crowded with goods, clerks, and customers. The Civil Service Supply Association, as it is called, sells $5,000,000 worth of goods a year; moreover, it has arrangements with a great number of the best firms in London, by which its members can buy from these firms for cash at from twenty to forty per cent, discount. The business done in this way is estimated at $5,000,000 more. Nine years ago, the association began by selling half a chest of tea. Its growth is a most joyous fact. It has been, however, a most alarming fact to the retailers of London. Two years ago, they petitioned Parliament to forbid the government employees engaging in such enterprises. The petition was in vain, but the petitioners took their revenge by driving Mr. Thomas Hughes from his place in the Commons. When a number of the underpaid clergy of the Church of England undertook to imitate the civil service clerks, their proposed league was broken up, it is said, by the threat of an organized bolt of small tradesmen into the dissenting sects.

England and Scotland have now over one thousand coöperative stores, and a number of manufactories owned in part by the operatives in them. These are leagued together by a system much like that of the United States under the old articles of confederation. There are five territorial divisions, or sections, which correspond to our States. Each of these is represented on the central board, a body of eleven men clothed with a scanty and a vague authority, and able to do little more than suggest needed reforms. Its suggestions seem, however, to carry great weight. Once a year, a congress composed of delegates from all the cooperative societies meets to listen to suggestions and discussions on every point of interest. There are similar assemblies in each of the five sections several times a year. When the twenty-eight flannel weavers of Rochdale gathered, by two years of patient saving, their scanty capital of $140, they planted a seed which has grown into a tree that now shelters thousands of healthy and happy homes.

The prevention of adulteration is one of the incidental blessings of distributive cooperation. Pure food can scarcely be found in small quantities, except in a coöperative store. The value of good food as an element in labor has been more fully appreciated since the publication of Thomas Brassey’s Work and Wages.2 It is doubly unfortunate that manual laborers, who need such food the most, should have the greatest difficulty in getting it. The poor buy from the last of along line of middle-men, and so run the maximum risk of being poisoned. This risk disappears when they can go to a coöperative store. Its owners, who are also its main patrons, do not adulterate the wares which they not only sell, but buy. Neither do they use false weights. At such a store, the customer gets full measure and pure goods. At an ordinary retailer’s he is apt to get scant measure, and he does not get goods at all. He gets bads.

A few figures, carefully verified, may serve to indicate the possible margin of saving by distributive coöperation on a small scale. A workingman friend of mine gave me a list of the groceries he buys every week, and the prices he pays for them. This list was taken to a wholesale grocer in Chicago, who is now selling supplies to several coöperative stores among the miners of Central Illinois. He gave me his prices for the same goods. The man who made out the list spends $3.36 a week for barley, coffee, currants, flour, pepper, raisins, rice, soap, soda, starch, sugar, and tea. All these twelve articles, with the possible exception of the currants and raisins, are probably greatly adulterated before they reach him. The wholesale price for the same quantities of the same things, in a pure state, is a shade over 82.50. If an allowance of five per cent. is made for the working expenses of a coöperative store, — and English experience shows that this is a high estimate, — my friend, if he could buy at such a store, would pay less than $2.64 for what now costs him $3.36. Such a saving, if carried out in other purchases, would add nearly thirty per cent. to his income.

Little effort is required to start a cooperative store, or to manage it at the outset. Let a dozen men form an association, and agree to pay every week a fixed sum, ten cents to a dollar, towards the capital. As soon as seven dollars has been paid in, the manager can buy a barrel of flour, which he will take to his home and weigh out there to the subscribers at nearly cost price. The saving on that single barrel would be from two to three dollars. With the money got by the sale of the flour, and with constantly accumulating subscriptions, a chest of tea can be bought. The saving upon this should be nearly fifteen dollars, and both the tea and the flour will be much better articles than can usually be bought in small stores. As each man pays the last installment of some stipulated sum, five or ten dollars, his weekly subscriptions will cease. His stock will be paid up. Meanwhile, money will constantly be turned into goods, and goods back into money. A sufficient price will be charged to cover the original cost and the expenses of management. The latter will be very light at first, for a small room will answer for a store, and the members of the society can take turns in keeping it open during the evening, when their day’s work is done. If finally a larger room has to be rented and a manager hired, it will be because the store is prosperous. In that store the workingman can buy pure food at the cost price, and have it weighed on honest scales. Everything will be bought and sold for cash, so that there will be no bad debts, no long accounts. A coöperative store never gives a cent’s credit. This is one of the reasons of its success. Cooperation and cash together carry the day.

Distributive cooperation is a phase of economic progress which will probably disappear at some time, but which will not do so until it has greatly lessened the number of persons engaged in merely distributing wealth, has concentrated in each city each branch of retail trade in the hands of a comparatively few firms or joint-stock companies in which the employees have a share of the profits, and has made this trade a cash instead of credit operation. Productive coöperation will, I trust, result in the almost universal abolition of the wage system.

I have chosen three examples of productive coöperation; one a signal failure, one a signal success, and the other both failure and success.

First, the success. Most of the platelocks used in England, and perhaps in the world, are manufactured at Wolverhampton, near Birmingham. Some years ago, one of the lock manufacturers there cut down his men’s wages. The men struck. Then the other employers hastily formed a lock-out, and so threw the whole body of mechanics out of work. The men met, and decided to establish a manufactory of their own. They went to work at once. The masters had immense stocks on hand. They put their prices below cost, and found a quick and ready market. Yet they were soon undersold by the men. The latter knew they must lose, and did so. But they stood by their machines, and worked with will and skill. They sold or pawned everything that could be spared. Some of them lived on three cents a day. At one time, when failure seemed inevitable, only a timely loan from a generous sympathizer enabled them to avoid bankruptcy. Some long years went by before the Workingmen’s Wolverhampton Plate-Locks Company began to pay well. When once it began, it did not stop. It is now3 a flourishing, profitable concern. The men are their own masters. They get the wages for their work and the profits on their work.

The failure is nearer home. In January, 1874, when the Chicago Tribune was publishing a series of articles on cooperation abroad, a man called at the editorial rooms of that paper, introduced himself as the secretary of a trades-union of carpenters, and asked the writer of the series to come to the next meeting of the union. He did so, and found these men bent upon forming a coöperative association for carrying on their trade. he sought in vain to persuade them to try their ’prentice hand on a coöperative store. They were bound to have a shop, or nothing. The doubtful experiment was made. As a stockholder in the corporation and a receiver in bankruptcy for it, the journalist tested the strength of the experiment well. Three things were fatal to it, — lack of business skill, lack of capital, lack of harmony. The first was the first to show itself. These simple men fell into the hands of a knavish lawyer, who first charged them an extortionate fee for getting the society incorporated under the general law of the State of Illinois, — a proceeding that requires about an hour’s work and the expenditure of a couple of dollars, — and then demanded that he should be elected attorney of the organization at a stated and startling salary. When they declined to do this, he held back their papers of incorporation from record, and managed in this way seriously to embarrass them. Meanwhile, they had bought large and costly books, the chief use of which proved to be to contain the complicated bankruptcy accounts, had provided themselves with an imposing and expensive seal, and had elected an array of officers. The second difficulty now confronted them. Their scanty capital had already been sunk. The lawyer took most of it; the books and seal took the rest. They could not venture on large contracts, but were forced to bid only on small jobs. Their figures were ignorantly reckoned and thus their work was too often done, and faithfully done, at a loss. Finally, however, the tide seemed to turn. A little money was made. Then a besotted spirit of dissension seized the men. They could not bear to obey the fellow-workman whom they had selected as their business manager. Quarrel followed fast on quarrel. When the ruling wage of carpenters in Chicago was $1.50 a day, a dissatisfied majority of the Coöperative Carpenters’ Association voted themselves $3.50 a day apiece, in fatuous disregard of the fact that there was no money to pay such wages. There was soon no money at all. The treasurer absconded with all the funds on hand, and the carpenters, paying thirty-four cents on the dollar of their joint debts, ceased to coöperate.

Their career may serve as an “ awful warning.” The causes of their ruin threaten every association of workingmen for producing wealth. Lack of skill, lack of capital, lack of harmony, — these are the rocks ahead. They can be shunned, but only by the exercise of uncommon care. Distributive cooperation should precede cooperative production. The store should accumulate the capital needed for the shop.

The famous “ industrial partnership ” between the Briggs brothers of Yorkshire and their men is the instance of combined success and failure which T have chosen as a final illustration.4

The Briggs brothers owned and worked two collieries. They were in constant trouble with their men, an idle, drinking, uproarious, careless set. The men had a rough saying that shows the depth of the ill-feeling: “ All coal owners is devils, but Briggs is the prince of devils.” Strikes were frequent. Holidays were taken with more than Spanish abandon. The capital invested in the business paid only about six per cent., on an average.

In 1866 the Briggs brothers formed a partnership with their men, on a plan proposed by Professor Fawcett six years before. They issued 9770 shares of stock of $50 each, and sold a small fraction of them to the workmen, taking their pay in installments. It was announced that future profits would be divided as follows: a dividend of ten per cent. would first be paid on all the shares, and the surplus, if any, would be divided into two equal parts; one of these would be used as an extra dividend on capital, and the other would be shared among all the workmen, whether stockholders or not, in proportion to the wages each had earned during the year.

The result was remarkable. The men, assured of half the profits above ten per cent. on the stock, did all they could to increase the profits. They worked steadily. They were careful of the tools and materials used. When a man found a broken tool, he did not kick it aside, as formerly, but took it to the shops to be repaired, saying, “ That ’s so much towards the divvy.” “ Divvy ” was their pet name for the dividend on labor. It became the interest of all that each should work. Each was an overseer for his fellows. A considerable part of the former expense of superintendence was saved. Public opinion, which before had favored dissipation, now opposed it. Idleness, drinking, and rioting became far less common. Good feeling between masters and men sprang up. Questions about wages, hours of work, etc., were settled by friendly talks or by arbitration. At the end of the first year, the Briggs brothers and the share-holding workmen got a ten per cent, dividend and $8500 besides, while another sum of $8500 was divided among all the workmen. The second year, the dividend to labor was $17,500. In 1875, when the plan bail been in operation for some eight years, the Briggs brothers were said to have cleared, on an average, during that time, sixteen per cent. a year on their capital, or nearly thrice as much as they had made under the old system. Meanwhile, their workmen, whether share-holders or not, had had annual dividends on their labor, and part of the joint profits had been used in supporting a library and schools for the benefit of the miners and their families. There had been a very notable advance in the morality, intelligence, and thrift of the whole body of employees.

Two years ago, the men struck. They did so in obedience to the orders of their trades-union, and on account of a quarrel between other men and other masters, with which they had nothing to do. Their own act dissolved the industrial partnership, and thus one of the most encouraging and important facts of the nineteenth century ceased to exist. The same cause put an end to a similar experiment in New York city, in 1872.

A certain manufacturing village lies sheltered between New England hills. A stream winds through it. It enters the town clear, dancing, health - bringing. Fretted by mill - wheels, checked by dams, poisoned with sewage, it oozes on its sluggish, death-dealing way. It leaves traces of its passage in white faces in the tenement houses near by, where drunken men, pinched-visaged women, and puny children rot and die. It leaves other traces, higher on the hill-side, in other white faces, whiter yet, — whiter than the tombstones above them. This is the village cemetery. And higher yet, in a purer air, above the dens and the graves of the many, are the homes of the few. The upper ten have comfort for their heritage; the lower thousand, crime.

Yet among these there are the elements of a celestial civilization; trained skill, executive ability, learning, wealth. Must the skill in handiwork be forever divorced from the ability, the learning, the wealth?

The answer to this question has a farreaching, political significance. The future of our institutions depends upon it.

“ Ill fares the land, to hastening ills a prey,
Where wealth accumulates and men decay.’

Boston is richer to-day than in 1839, but how infinitely fitter for democratic forms of government was the town of 80,000 inhabitants, with “ no visible poverty, little gross ignorance, and little crime,” than the city of 350,000, with its swarming paupers, its untaught voters, and its Pipers and Pomeroys! And yet Boston is more prosperous and moral than almost any other city in the land.

The increase of socialistic sentiment among the masses is not a matter of light consideration. If the proletariat once becomes convinced that property is robbery, what can prevent the temporary extinction of both property and society? Socialism is a sign of discontent. It grows rank in times of depression. It withers away as comfort increases. The book that contains the most forcible argument against Proudhon’s maxim is a bank-book.

Alfred B. Mason.

  1. For full details of the methods of management at Rochdale, the reader is referred to The Primer of Political Economy, by Alfred B. Mason and John J. Lalor. Chicago: Jansen, McClurg & Co. 1875.
  2. See also Macdonell’s Survey of Political Economy.
  3. My last definite information about this coöperative enterprise was in 1873. I believe, however, that it is comparatively no less prosperous now than then.
  4. The next few paragraphs are condensed transcripts from Mason and Lalor’s Primer of Political Economy.