Democratic Socialism in Britain, Vol. 1

Classic Texts in Economic and Political Thought, 1825-1952

David Reisman

• Publisher: Routledge
• Year: 2021
• ISBN:
  9781000419474
• Edition: 1
• Topic: Economics
• Subtopic: Economic Theory
• Index: Economics

The texts in this collection of 10 volumes demonstrate both the diversity and continuity in British theories of democratic socialism. The selection encompasses the Ricardian socialists, the Christian socialists, and the Fabian socialists. Volume 1 includes 'Labour Rewarded and 'Labour Defended'.

INTRODUCTION
RICARDIAN SOCIALISM

Herbert Foxwell, writing an introduction to Anton Menger’s The Right to the Whole Produce of Labour in 1899, expressed the opinion that it had been none other than David Ricardo who had given ‘the really effective inspiration to English socialism’: ‘It was Ricardo’s crude generalisations which gave modern socialism its fancied scientific basis, and provoked, if they did not justify, its revolutionary bias.’ A stockjobber, a currency-speculator, a country landowner, a Member of Parliament, a Benthamite, a Whig, the self-made tenant of Gatcombe Park would clearly not have been pleased with the verdict that it was he who shunted the car of political economy on to the red line that led to Marx. Yet he would not have been able to deny that his great work on The Principles of Political Economy and Taxation (the first edition appearing in 1817, the third and final edition in 1821) was, like Adam Smith’s The Wealth of Nations in 1776, a treasure-house of exploitation theories that discontented labour could seize upon and make its own.

Thus Ricardo, citing Smith, indicates that labour-embodied is the source and measure of all value-added, ‘the foundation of the exchangeable value of all things, excepting those which cannot be increased by human industry’. The labouring-class, Ricardo continues, cannot expect more than a subsistence wage despite the fact that it is the sole producer of all objects of wealth. The reason for the shortfall is the need to share — with the landowners who love to reap where they never sowed and with the capitalist employers, ever conscious that ‘there can be no rise in the value of labour without a fall of profits’. Ricardo’s theories, like those of Smith, were not intended to nurture class-hatred or to foment class-conflict. By the time of Ricardo’s death in 1823, however, they were already serving as the basis for a new departure in political radicalism that Foxwell was the first to call by the name of ‘Ricardian socialism’.

The ‘Ricardian socialists’ of the 1820s and 1830s were not a coherent school or a unified movement. They held no joint meetings and published no official journal. What gave the isolated pamphleteers a common identity was their shared conviction that, precisely because the mainstream economists had conceded that labour alone is productive of value, therefore the parasitical ownership of the means of production had to be abandoned in favour of a tenure that would be less alienating and less unjust. The background was that of unemployment and urbanisation, long hours and degrading conditions; of the extension of the franchise in 1832 and the reform of the poor law in 1834; of the repeal of the Combination Acts in 1824; of the agitation against the Corn Laws that was to reap its reward only in 1846. The background to the ‘Ricardian socialism’ of the 1820s and 1830s was early industrial capitalism and the transition to laissez-faire. The principal contributors to the new departure were four in number.

John Gray (1799-1883) was a clerk in a London wholesale house and the author of the Lecture on Human Happiness (1825), The Social System (1831), the Remedy for the Distress of Nations (1842), and Money (1848). Convinced that the competitive economy was the cause of low wages, depressed output and widespread poverty, Gray at first believed producer co-operatives to be the solution before deciding that a better option would be the planning of production accompanied by the liberalisation of finance. John Bray (1809-1897), printer, photographer, farmer, was of working-class origin. His book, Labour’s Wrongs and Labour’s Remedy (1839), was an attack on the employment contract for lending unwarranted legitimacy to the capitalist’s theft of a part of the worker’s value added. Bray saw no future in the employment of labour by capital. He recommended that property-rights should lie with the workers themselves and that the money-supply should take the form of vouchers issued in exchange for labour time. A communist at heart, he hoped that in the long-run the assets would be owned by the community as a whole.

Bray, like Gray, showed that labour as well as capital could appeal to the classical economists in support of its claims. So, and even more convincingly, did Thomas Hodgskin and William Thompson — the authors of, respectively, Labour Defended (1825) and Labour Rewarded (1827), reprinted in this collection.

Thomas Hodgskin

Thomas Hodgskin was born on 12 December 1787. His father was a keeper of stores at the Admiralty dockyards, Chatham. Something of a domestic autocrat, his selfishness and extravagance ensured that the family’s standard of living was never very high. Thomas left school at the age of 12 and became, as a consequence of his father’s contacts, a naval cadet. He spent the next 12 years largely at sea, in the Mediterranean, the North Sea, and off the coast of Africa. It was the period of the industrial revolution, the French Revolution, the Napoleonic Wars. Hodgskin read widely in order to understand what was happening. In the main he was self-educated.

In 1812, aged 25, he was retired on half pay from his post as a lieutenant. Conflicts with superior officers and resentment of naval discipline were the reasons for his premature severance. His first publication, An Essay on Naval Discipline (1813), reveals the depth of his bitterness. In his Essay Hodgskin contrasts the arbitrary and oppressive nature of military life with Britain’s good government that had learned from Locke the importance of individual rights. Hodgskin makes clear that he is a Christian (not yet the Benthamite atheist that he was later to become), opposed on principle to caprice and brutality such as offend against the religious standards of justice and mercy. He also affirms that even officers must not punish at random for the important reason that no man may be said to be unequal in sensibility: ‘The beneficent creator of all has given to every man similar passions.’ Hodgskin in his Essay complements his attack on the authoritarian personality with an appeal to individual self-interest that recalls Godwin’s Political Justice (1793) (a work that Hodgskin does not mention by name but which he is likely to have read) and other early classics of natural harmony as if guided by a providential hand: thus he criticises recruitment by means of the press-gang and comes down in favour of a competitive rate of pay instead. Just as there is market freedom in the Essay, however, so is there a surprising invocation of regulation and the State. Observing, for example, that unrestricted private property ‘takes from the daily labourer to give to the idle gentleman’, Hodgskin proposes that the State should forbid by law a retinue in excess of two personal servants. Private property is evidently to be subordinated to social utility; and the government is pragmatically to retain an interventionist role even in an era of highly-desirable individual liberty.

The message of the Essay inevitably brought the young anti-authoritarian to the attention of utilitarian radicals such as Francis Place. Tailor, employer, reformer, an advocate of birth-control, a friend of Bentham, Godwin and James Mill, Place recognised that Hodgskin shared many of the radicals’ concerns and invited him to take part in their discussions. Hodgskin at the time was considering what to do next in his life. Having lost his naval career at the age of 25, lacking formal education or practical qualifications, he was, understandably enough, in a gloomy, rather state of mind.

In 1815, Waterloo having opened up the Continent at last, he travelled abroad, to France, Italy, Switzerland, Austria, Bohemia, Germany and Holland. On foot and on his own, he met ordinary people, peasants and workers, not political leaders and philosophers. In Paris he was angered by State intervention in education and by the ubiquity of the police presence: modest and shy, he decided not to make use of an introduction to J.B. Say to discuss with him the future of democratic individualism. In Florence and Rome he was discouraged by the influence of organised religion. In Hanover he married a German girl, his companion for the next 50 years.

In Hanover he also made an empirical study of economic, social and political conditions, employing a questionnaire drafted for him by Jeremy Bentham. His detailed findings were reported in two volumes in his Travels in the North of Germany (1820). His conclusion was unambiguous — that historical evidence as well as the deductivist’s a priori lent support to his existing belief in the logic and the beneficence of the self-stabilising order: ‘The moral laws of nature are as regular and unalterable as her physical laws. He, who has so beautifully constructed our bodies, has not left our conduct, on which our happiness depends, to be regulated by chance.’ Hodgskin welcomed laissez-faire as the triumph of wise automaticity over the inappropriate contrivances of parliaments and judges that had ill-advisedly converted the workforce into ‘unremunerated and trembling slaves’ while inviting evasion such as inevitably undermined popular respect for the law.

Hodgskin’s Travels was libertarian rather than interventionist in character: ‘Many evils are, in Germany, occasioned by governing too much’ is characteristic of his position. The university system, owned and operated by kings and ministers, had become subservient to the status quo. Intellectuals had become afraid to challenge the stifling conservatism of the traditional bind. Artists and scholars had been wastefully over-produced by State patronage that was an inefficient substitute for free market pricing. Publicly-provided roads were in Germany the inferior of their private-sector counterparts in Britain. The Germans, Hodgskin observed, believed mistakenly that the government was in a position to promote their prosperity. The truth was different, that the wealth of nations waits upon the energies of individuals and cannot be stimulated by a policy of restraint.

Laws and directives were uneconomic. They were also unjust. A follower of Locke on labour, Hodgskin defended the right to private property in those cases where labour expended could be shown to be the basis for the title. Often, however, it is the artificial and divisive claims of an aristocracy of birth or wealth that are upheld by a passive and obedient State; and the result then is an inequality and an inequity so flagrant as to alienate the citizen even from the reforming parliaments that middle-grounders like Francis Place believed to be of the essence for the advancement of the working classes. In so unnatural a society, ‘industry is the slave of idleness’ and poverty, distress, squalor (legitimately inflicted misery’) are the rule: ‘He who produces everything receives almost nothing while those persons who produce nothing revel in superfluities.’ It is at this juncture that Hodgskin in his Travels articulates for the first time — in advance of Thompson, Gray or Bray — the proposition that was to be the defining conviction of the ‘Ricardian’ socialist: ‘The landlord and the capitalist produce nothing. Capital is the product of labour, and profit is nothing but a portion of that produce, uncharitably extracted for permitting the labourer to consume a part of what he has himself produced.’ The Principles were published in 1817, the Travels in 1820. Returning to Britain late in 1818, Hodgskin immediately recognised what was relevant in Ricardo’s book. One of the reviews of the Principles which helped him to perceive the link between the labour theory of productivity and the case for a one-class economy is likely to have been that by J.R. McCulloch in the Edinburgh Review.

The Edinburgh Review and McCulloch’s Scotsman were arguably the apex of libertarian journalism. From 1819-22 Hodgskin lived in Edinburgh and attempted to make his mark. The attempt was not a success. Hodgskin was lacking in self-confidence, plagued by feelings of inferiority, all-too-aware that other intellectuals had learnt Latin and Greek whereas he was only an expelled seaman and an autodidact. Unprepared to push himself forward, Hodgskin was subject to the further handicap that he was known to be hostile to the capitalists (and not just to the landowners), believed to be in favour of the anarchic order (and not merely of the minimal State). In poverty, greatly disappointed, Hodgskin and his wife had to accept money from Place in order to survive. At the end of 1822 Place found him a post as Parliamentary correspondent for the Morning Chronicle and he returned to London.

Working-class education was in the air. Hodgskin’s radicalism had long extended to freedom of expression, the power of public opinion and the political enlightenment of the unenfranchised majority. In London he became involved, with Place, Robertson and others, in the campaign that culminated in the creation of the Mechanics’ Institute and the Mechanics’ Magazine, both in 1823. The former face-to-face, the latter by means of the written word, each was an attempt to raise the standards of the masses in technical subjects such as chemistry and also in socially-charged areas such as political economy.

In France and Austria the State had made technical education a public responsibility. In Glasgow, Edinburgh and Liverpool, on the other hand, the colleges had remained resolutely self-help. Writing in the Mechanics’ Magazine in October 1823, Hodgskin made clear that for him the worker-funded institution was the only reliable way of insulating the labouring classes from the thought-control of their masters: ‘The education of a free people, like their property, will always be directed more beneficially for them when it is in their own hands. When government interferes, it directs its efforts more to make people obedient and docile than wise and happy.’ Hodgskin throughout his life was hostile to State education, warning that a ‘forced system of culture’ was always and everywhere a despot’s threat to freedom_ ‘Men had better be without education... .than be educated by their rulers.’ Private education and private payment at least had the attraction that (accompanied by economic growth so as to make it easier for the consumers to afford the expense) the schools and the colleges would bend passively in the service of free will and free choice. Francis Place, acknowledging the threat from the State, was less uncompromising.

Place took the view that the new Mechanics’ Institute would not survive financially if it had to depend exclusively upon working-class support. In opposition to Hodgskin, therefore, he persuaded his co-founders to solicit outside contributions from sympathetic radicals. One of these was Dr. George Birkbeck, who subscribed a large sum but also said that it had to be regarded as a loan at interest. Hodgskin was, not unexpectedly, highly critical of this concession to the money-making ethos. He was in a minority and clearly marginalised. Late in 1823 the members of the Institute’s commission were chosen. Place was elected. Hodgskin was not.

Hodgskin continued to contribute to the Mechanics’ Magazine until 1829, when he fell out with I.C. Robertson, his co-editor. His articles in the weekly repeatedly make the government the target. The census, he writes, ought to be opposed because it treats men ‘something like beasts, in whom their rulers have a property’; while the Spitalfields silk-weavers in their quest for a binding minimum wage would do well to remember that ‘legislators have always belonged to the non-labouring classes of society.... It seems bad, therefore, for the poor man to have any law of this kind emanating from them.’ The Benthamite utilitarians cannot have been very pleased with his across-the-board rejection of social channelling by means of legal norms. His anarchistic individualism is likely to have been an important reason why his two applications for professorships in the University of London — for the Chair of Logic and the Philosophy of the Human Mind and the Chair of Moral and Political Philosophy, both in 1827 — were not successful.

In 1825 he had given courses at the Mechanics’ Institute on grammar, on the progress of society and on political economy. His lectures on money, trade, prices, productivity, ‘knowledge-guided labour’ and interdependence through specialisation (‘I should say that division of labour is an admirable means by which each person may know all things; while to enable him to subsist, he is required to perform only one small part of social production’) were published in 1827 as Popular Political Economy. Deliberately simplified in order to convince a non-specialist audience, Hodgskin’s book emphasized that labour alone is the source of all value, that profits and rents must always and everywhere be a drain and a transfer. It was not the first time that he had gone into print to say that he who has killed the bear seems clearly entitled to keep the skin. In 1825, at the same time that he was lecturing on political economy to the students of the Mechanics’ Institute, Hodgskin had published (signing the work ‘by a labourer’) his most important contribution to the literature of ‘Ricardian’ socialism_ Labour Defended against The Claims of Capital; or The Unpro-ductiveness of Capital Proved. Not since the mercantilist Thomas Mun’s England’s Treasure by Forraign Trade had a title better captured the substance of what lay within.

Labour Defended...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Acknowledgements
• General Introduction by David Reisman
• Introduction to Volume 1 by David Reisman
• Labour Defended
• Labour Defended against the Claims of Capital
• Labor Rewarded
• Advertisement
• Heads of Inquiry
• The Claims of Labor and Capital Conciliated