Chapter III: Personal Services (2)

In the professions generally, and particularly in the ministerial profession, while, if we confine our attention to those persons who both have the requisite gifts of Nature and have been also thoroughly trained, we shall find a high rate of compensation on the two grounds of a strong Demand and a limited Supply, we must bear in mind too the counter-working influences which tend to increase the competition and thus decrease the compensation, namely, the respectability which attends them, the desire of knowledge for its own sake which is gained in connection with them, the instruction wholly or in part gratuitously offered to those in course of preparation for them, and the desire to do good without regard to pecuniary reward which actuates many who enter upon them.

(d) Physicians and lawyers and clergymen serve primarily individuals, or at most relatively small groups of individuals, and of course look for their pay to those whom they have served. It is different with Statesmen, the fourth class of professional laborers that we need to look at in an economic view. Statesmen worthy of the name serve at least a whole nation, and to the nation as such must they turn for their pecuniary rewards. And such men have never turned in vain to those whom they have benefited as a whole. Bismarck is the best modern instance of a Statesman, who has received from a grateful country immense money-measured remunerations for immense political services rendered. The Demand for the services of Statesmen rests in the deep consciousness of men organized politically into a Nation, that they need, especially in trying times, a Man of the highest natural gifts, and of the broadest attainments and of the loftiest political integrity to plan and act for them in emergencies, as they are conscious that they cannot plan and act for themselves organically. This does not mean, that the one ever knows essentials better than the many: he does not. This does not mean, that the true objective of a nation's march is ever discerned more clearly, or rather _felt after_ more eagerly, by one man than by the many men concerned: it is not. Still less does it mean "_a man on horseback_." But it does mean this: a Nation (as the very name implies) is made up of the thoughts and hopes and throbbings and dim forecastings and half-formed purposes of multitudes constituting a unit (born together for one destiny on earth); and the true Statesman is one of themselves, sharing with them at once the traditions of the past and the perspectives of the future; one, with the instinct and the intellect to gather up and embody the general feeling and the general will; one, who has gained in some way the confidence of the masses who are willing for the time being to entrust to him the guidance of their affairs, and to empower him to plan and act for them as their champion and deliverer; and one, who (because he _is_ one) can better seize the propitious moments for declaration and negotiation and public action, yet who never forgets that he is nothing but an _agent_ for others, and is as ready to lay down responsibility at the public will as to assume it at the public will.

Washington was such a statesman, and Lincoln. Even Bismarck, under monarchical and later imperial environment, disclaims anything substantive and original in his own action: he did what he could not help doing: he followed the instincts of Prussia, and his own; and became the means of fulfilling as they gradually ripened the longings of the other German people for unity and order. Such a statesman was Chatham in England, and Cavour in Italy. Now, such services as these, done for a whole people, always deserve and usually receive, though not expressly bargained for beforehand, yet implied in the public devotion of one party and the general _consensus_ of the other, extraordinary honors and emoluments. This is right, even on purely Economic principles. The services of great statesmen to their country in great epochs and emergencies are at once a gift and a sale, they are both patriotic and economic, there is equally a national Demand for them and a grateful recognition of them, the Supply is always exceedingly rare and the reward often exceedingly great; and it is to be put down to the lasting credit of the science of Economics, that its peculiar motives and results may mingle in and harmonize with the motives and results of the higher moral impulses, such as those of Patriotism and Religion, as in the cases of the Soldier and Statesman and Clergyman. There was no rational ground for the hesitation of Garibaldi to receive from the Parliament of Italy in 1875 an annual pension of 50,000 lire.

(e) There is a single class more of Professional laborers, loosely so-named, which should be noted before we dismiss the subject of Demand for laborers to pass to consider the Supply of them, namely, Literators and Artists and Actors of the highest rank. Statesmen primarily serve the individual nation that selects and rewards them, though their influence may indirectly uplift other nations also; but the great Writers and Painters and Actors, whatever may be their local habitation and name at first, soon come to belong to the world at large and to derive their revenue from many lands, because the highest Art is cosmopolitan in its own nature, and the best characterization of men as such cannot but be the property of Mankind. Shakspeare is no longer English, nor Angelo Italian, nor Mozart German, nor even Bernhardt French. Deep as are the scars and the sea that separate nation from nation, there is something deeper still in the innate recognition by man of man as depicted by the great Masters in immortal lines. There is, accordingly, a sort of Demand in the inmost soul of Humanity as such for these living and lofty touches and delineations of itself, whencesoever they may come. There is not indeed nor can there be, as in most other cases of sale, a bargain made beforehand between these preordained sellers of the rarest services and their silent yet waiting purchasers, yet there is after all an antecedent and an assured understanding between them. They are in touch even across the sea. The master strikes his chord, and the audience, fit, though few and scattered, listens and applauds _and makes return_.

Is the principle of "International Copyright," so-called, correct? Let us look narrowly before we pronounce. At present this good country of ours makes itself a mocking and a by-word even to its own intelligent and art-loving citizens by putting a tariff-tax of 30% on paintings and statuary by foreign artists, not at all to get revenue thereby, but to "protect" domestic artists in their inferior work by artificially lifting the price of their wares. So far is carried this jealousy of foreign works of art, that when the artists generously loan them for exhibition on our national occasions, they are put under bonds _not to sell them on this side_ without previously paying the tariff-tax, which is graciously intermitted during the Exposition. This is Restriction. This is Protectionism pure and simple. This is legally excluding the Better in order to give a forced currency to the Worse. Now, domestic Copyright restricts the sale of any book to one publisher in his interest and in that of the author. The book now in the reader's hand is thus copyrighted. This legal arrangement between authors and publishers and their public may be perhaps logically defended, it may even be for the public weal on the whole, though in many cases it doubtless raises the price of good books, which would have been published without any such artificial encouragement. The copyright, however, like all patent-rights also, soon expires by limitation of time, and the public thereafter have the unrestricted use of what is really their own.

For what is sometimes called "literary property" is not property in the strict sense of the word. A book is not like a plough or a house. Its contents even when most original have been but colored, as it were, and rearranged and reinforced by the author's individual mind. Its substance always comes out of the common stock. It cannot be the author's own, as the bushel of wheat is the farmer's, who sowed the seed on his own land and threshed it in his own barn and carried it to market in his own wagon. The rights of the individual and the rights of the Community commingle more or less in private property of every kind, at least to the extent that the latter may tax the property if needful for the common wellbeing, as it is bound also legally to secure it to the owner when threatened by others; it is no part of the purpose of the present book to draw the wavering line in general between the rights of individuals and the rights of their Government as towards them; but the distinction between common property and copyrighted property is plain enough to everybody, and the Law puts emphasis on the distinction by making the one quickly terminable and the other continual. So then, when the Government under which the author resides, has given him a limited copyright within its own jurisdiction, it would seem as if the individual right in the premises had been sufficiently recognized alongside of the undoubted right of the Whole to the ultimate use of the labors of their own citizen.

When, however, it comes to International Copyright, which is an attempt to secure to authors of one country artificial privileges under restriction in selling their wares in all other countries, the argument breaks down. Even for the one country, in which the author lives and is taxable, the argument is not very strong, and hardly binds advanced public opinion either as to the grounds of it or even the practical benefits of it on the whole. By the attempted extension of it to all countries, its reasonableness disappears. Taxation cannot extend beyond the jurisdiction of the country taxing; and it certainly seems as if a legal privilege, beyond common law privileges, ought not by extension through the formal action of other countries to exempt from taxation (in case it were needful) the results of the original privilege. The purpose of International Copyright is not the blessed one as announced to the world by James Smithson, "_the increase and diffusion of knowledge among mankind_," but directly and artificially by means of legal restrictions the "increase" of the prices of books and of other "knowledge" to the masses of "mankind," and the "diffusion" of these extra prices as between authors and publishers. Protectionism does not seem to be one whit more respectable in this form than in the form of tariff-taxes on foreign works of art.

2. We have already seen in our first chapter the proofs of the proposition, that the Value of anything whatsoever bought and sold is determined by the Demand for it and the Supply of it then and there present. Also we have now seen at considerable length the main phases and grounds of the Demand for each of the three classes of Personal services bought and sold among men. The next topic in order is the Supply of personal services in the various markets. Here it will not be necessary to distinguish particularly the three classes of Services, inasmuch as the circumstances governing the Supply in each are substantially similar.

In Economics generally we have to deal chiefly with Persons, and only subordinately with Things; when we come to the Supply of personal services, answering to the Demand for them on the part of other persons, this point becomes conspicuous; and it is here, if anywhere, within the realm of our science, that we need to devote a word to a singular doctrine, that has been famous for nearly a century under the term of _Malthusianism_. Thomas Robert Malthus, 1766-1836, was an English clergyman and teacher, a wide traveller and keen observer of men, one who divided his time during a long life between cure and chair and the libraries of the Universities, published in 1798 his "_Essay on the Principles of Population as it affects the Future Improvement of Society_"; in this and in subsequent editions enlarged and enriched, he brought out with its proofs the core of his startling pronouncement, that the human race is found to increase in numbers in something like geometrical progression, while the means of subsistence for them on any given area of agriculture can only increase in something like arithmetical proportion; the United States was then doubling its population in 25 years, and he calculated that, at this rate, the inhabitants of any country in five centuries would increase to above a million times their present number, which would give England in that time more than twenty million millions of people, or more than could even get standing-room there; for this natural tendency of the law of human fecundity to outstrip the results of the law of returns from land, he saw no remedy except in checks to population, which he divided into _the positive_ and _the preventive_, the first of which, such as war and famine and disease, increase the annual number of deaths; and the second of which, such as prudence in contracting marriage and temperance after marriage, diminish the number of births; and Malthus and his followers, among whom the famous Thomas Chalmers was prominent, were at great pains to inculcate upon the laboring classes the duty of later marriages and fewer children, as an indispensable condition of their rise in comforts, and of "the future improvement of Society."

These discussions have attracted great attention almost to the present day, and have been supposed to be very pertinent to the subject of wages, and thus to be an important part of Political Economy; but when one looks more closely, the force of that spring of population which the Creator has coiled up in the nature of man, as contrasted with the weakness of that power by which the earth brings forth sustenance for man, is seen to be a topic in Physiology and not in Political Economy at all. Political Economy presupposes the existence of Persons able and willing to make exchanges with each other, before it even begins its inquiries and generalizations. How they come into existence, the rate of their natural increase, and the ratio of this increase to the increase of food, however interesting as physiological questions, have clearly nothing to do with our Science. Each adult human being is as much constituted by Nature to receive personal services as to render them, in Economics each without exception receives when and because he renders, and all alike are naturally able to become capitalists also; economical laws present no obstacles, that we can see, to all men becoming _rich_, as we use that term; the town or city in which many people are growing rich simultaneously, is the best place in the world for other people to go to get rich in, and not at all towns in which other people are getting poorer; most men are unwilling, some perhaps may be unable, to fulfil the moral conditions of growing rich; while, we may depend upon it, the famines of the world have been caused more by the indolence and want of foresight of individuals, and especially by the monstrous maladministrations of Governments, than by any law of the increase of population.

Experience too has shown, that the strong impulse in mankind towards procreation is not too strong for the purpose intended by the Creator; that HE who is the author of the impulses is author also of natural counterworkings of them; that, as men under moral and religious training come more and more under the influence of reason and affection, the preventive checks to population come silently and effectually into operation; and that, taking the world at large, food and comforts have more than kept pace with the stride of population, since its inhabitants as a whole were plainly never so well fed and clothed and housed as now. The abstract antagonism of the law of the increase of population with the law of the increase of food, or what we prefer to call the law of diminishing returns from Land, may be admitted, if one chooses to insist on it; but any practical _tendency_ of these to come into collision, as the world is and is to be, is confidently denied. When Malthus wrote, and long afterwards, England was under the dominance of Protectionism; the wretched Corn-laws forbidding the importations of foreign grain, in order that the domestic growers might sell to their countrymen at artificial prices, and thus grow the richer as bread became the dearer, were only repealed in 1846; and the demonstrated ability of Great Britain under free trade to draw on the fertility of the whole world for the steadily and increasingly cheap maintenance of her people, demonstrates the irrelevancy of Malthusianism to the Science of Economics.

The Supply of personal services at any time or place in answer to the Demand for them, is affected by several important circumstances, which we shall now proceed to consider in their order.

(a) The _agreeableness_ or disagreeableness of rendering a given set of services will affect the Supply of laborers at that point, and help to determine the rate of Wages paid to them; because the more agreeable employment will attract the larger number of laborers, will experience in consequence the press of competition, and the rate of wages then and there will be lessened thereby. The more disagreeable employment will feel less the pressure of numbers, and will secure, other things being equal, a higher rate of remuneration in consequence. Among the elements which, in spite of diversity of tastes, make any employment agreeable or disagreeable to the laborers, are (1) the less or greater exertion of physical strength required, (2) the healthfulness or unhealthfulness of the service, (3) its cleanliness or dirtiness, (4) the degree of liberty or confinement in it, (5) the safety or hazard of the employment, (6) the esteem or disrepute of it in public opinion. To illustrate each of these in order, the stone-mason, the glass-blower, the scavenger, the factory operative, the worker in a powder-mill, the smuggler, will each receive a larger compensation owing to the peculiar element of disagreeableness involved in his own personal service; and he will be able to demand and secure the higher rate through the action of this disagreeableness upon the Supply of such laborers. Of all these elements, public opinion is perhaps the most operative; and if this be favorable to an employment, and some social consideration be attached to it, and only common qualifications be required for it, the wages in it will infallibly be low. This is doubtless the main reason why so many young women prefer to teach, rather than be employed in mills or shops or offices, and why the wages of female teachers have been so remarkably low; although each of the elements of agreeableness specified above may also contribute something towards the same result. If a business be decidedly opposed to public opinion, it must hold out the inducement of a large reward, or nobody will engage in it. This explains the abnormal gains of the slave-trade, the liquor-business, of gambling-houses, and of lotteries.

(b) The _easiness_ or difficulty of learning to render acceptably a given set of personal services, will have a quick and constant influence on the Supply of these services, and of course also on the rate of the return paid for them. The elements of this Difficulty in general are time, expense, lack of natural gifts, want of foresight on the part of those concerned, and lack of push and persistency on the part of the learner himself. To put a boy apprentice to a trade, for example, requires on the part of the parents a foresight, an ability to get on without his immediate help, and sometimes also an amount of money for his board and clothes which all parents do not possess; many boys too, who must acquire their skill to sell personal services when they are young, if at all, find on trial that they do not like the trade, or have not the requisite gifts, or fail in the appropriate patience and propulsion; and the consequence is, that the Supply of laborers along that particular line is lessened, and the right to demand and the ability to secure a higher rate of wages than is accorded to common laborers accompany the small supply, through the reduction of numbers which these obstacles at the entrance occasion and the consequent weakness of competition. This is one principal ground of the difference in the wages of skilled and unskilled laborers; the other being, as we have seen, the stronger and more constant Demand for the former, owing to the impulse imparted by Capital. All these points of difficulty at the outset apply still more strongly in the case of professional laborers, serving more effectually to thin out the ranks of these, and pushing upward still higher the gauge of compensation for the successful competitors.

(c) The _constancy_ or inconstancy of prospective employment in a given business, is a consideration that affects the Supply within it, and then the wages. If the services be of such a character, that they can only be carried on during nine months of the year, the wages of the renderers will be greater by the day or the month than they would be, provided the services were in order during all the twelve months. The laborer is apt to look at the aggregate earnings of the year, and will hardly take up a trade which affords employment but a part of the time, unless some compensation can be found in the higher wages for that time. This is the chief reason why the wages of the mason and house-painter, in this climate at least, are higher than those of the blacksmith and carpenter. The coachman, also, may stand by his horses half the day or night with no call for his services, and must have, therefore, a proportionably higher fare from those whom he does transport. In general, it is found that men prefer a constant rendering with a lower rate of pay, than an inconstant one with a prospect of larger wages for the particular jobs actually done; and because the many prefer that, those who take up with the other are able to secure a higher relative rate of pay in their less eligible vocation. It must be noticed, however, as counterworking this, that some men have desire for intervals of leisure in their business, and for opportunity to make these intervals subservient to some avocation or other means of livelihood.

(d) The _probability of success_ or the opposite in any line of personal services, is a circumstance that has some influence on the rate of wages paid in it, through the action of this probability on the numbers of those who enter upon it. If ultimate success be doubtful, fewer persons will naturally engage in such a business, and those who dare in it and succeed, will probably reap a very high reward. So, also, those who take jobs by the contract, and therein assume more or less of risk, are commonly paid at a higher rate for their services than those who do similar work by the day. It is true, that this is owing partly to the fact that the contractor usually puts in his own capital more or less, and must therefore be paid profits as well as wages, and also that the wages of superintendence are due to him in addition to ordinary wages; still, there is a residuum of difference, which can only be accounted for by the risk he runs of a successful issue of his contract. The general variation in Supply and wages from this fourth cause, would certainly be greater than it is, were it not for the overweening confidence which men in all generations seem to have in their own good luck. This excess of worldly faith is always seen in the rush which is made for newly discovered mining regions. It was seen to perfection in 1889 in the uncontrollable advance of thousands _into_, and their almost immediate exit _out of_, the then just opened territory of Oklahoma. The facility with which lottery tickets are sold even yet in many countries proves the prevalence of this over-confidence. It is demonstrable beforehand on the doctrine of Chances, that no person can rationally buy _any_ lottery ticket at its advertised price, because if that person should buy all the tickets advertised he would certainly lose money, since the sum of the prizes is always less than the sum of the prices. Otherwise the projectors of the lottery would always lose money.

(e) The _mobility_ or immobility of laborers as a class acts powerfully upon the Supply of them at any one time and place, and consequently upon the rates of wages then and there. In some countries, notably in the United States, laborers as a class move from place to place with considerable facility under the action of Demand for personal services. According to the Census of 1870, 7,500,000 of the native population dwelt in other States than those in which they were born. Many of these, doubtless, had left their native region to obtain more fertile land, and many also to obtain more remunerative employment as laborers. The native American, more than most other persons, is not only willing to move from place to place in the hope of bettering his condition, but is also willing to change his occupation from time to time in the same hope. There is more freedom of movement locally, and less fixedness of occupation on the part of laborers and others, in this country than in any other industrial country. Even foreign immigrants here,--factory operatives, miners, and other laborers,--seem to catch after a while the spirit of the country in both these respects. There is one considerable advantage in all this, namely, competition becomes more uniform in all places, an unusual demand for laborers at any one point is easily met, and wages neither rise so high nor fall so low at special points as they otherwise would. But there are considerable disadvantages in all this too, chiefly these, the services of laborers floating locally or changing the kind of their labor can never become so excellent as service more _steady_ in place and time; and, especially, thorough apprenticeships, or whatever may be equivalent to these, are held in too little esteem by public opinion, and are too little requisite in order to obtain transient employment. To meet the obvious pressure of these disadvantages, an admirable device is now being hit on, namely, to introduce into our public schools something in the way of "manual training" for the various trades. Public institutions also, some of them on a great scale, as the Cooper Union in New York and a more recent munificent foundation in Philadelphia, have been established on purpose to train boys and girls both in eye and hand to render skilfully those artisan services of the various kinds which will always be in demand among men, and which have certainly deteriorated among us owing in part to the disuse of the old apprenticeship-system.

In Europe, on the other hand, the laborers as a class are far less mobile than here; and in Asia still less so. There is said to be no country in Europe in which the proportion of foreigners to the native population exceeds _three per centum_. In England, which is a small country, the difference in Wages between the northern and southern counties is very remarkable. Professor Fawcett is authority for the statement, that an ordinary agricultural laborer in Yorkshire during the winter months earns 13 shillings a week, while a Wiltshire or Dorsetshire laborer doing similar work during the same number of hours earns but 9 shillings. The contrast in general between the Wages of English agricultural laborers and those paid in mills and mines and furnaces is still more striking. And so more or less, in respect to the Value of Commodities: competition is yet by no means perfect in distributing these so as to make their price uniform in the same country or even in the same county; but the immobility of laborers for an obvious reason is much greater than the immobility of goods. While laborers should certainly be free to go wherever their services may be in greater Demand, the natural reluctance of most men to leave their native haunts, enables each of the nations to work out its freely chosen ends without wholesale interference from abroad. If China should precipitate itself upon the United States, or India upon England, as the mere _economical_ impulse might indicate, it would be disastrous to the western nations; but men are everywhere under other influences besides the economical one, although this is strong and distinct and pervasive; Political Economy deals with men as they _are_ all things considered, and with Buying and Selling as this actually takes place over the world, or rather as it would take place if factitious economical restraints were removed; and Providence has other great ends in view besides commercial prosperity, vital as that is to all other progress, and often holds one impulse in check by a stronger one.

(f) _Custom_, with its cognates Prejudice and Fashion, has still a good deal to do with the Supply of laborers in certain departments of effort, and of course with the rates of wages in them. In former times in this country and in the older countries particularly, Custom and decree were dominant in determining, for example, the current fees of lawyers and doctors, competition coming in to decide how many such fees a professional laborer should get, rather than the amount of each particular fee. The shares of the produce going respectively to the agricultural tenant and to the landowner, were specially under the dominion of Custom; as the mode (now decadent) of taking farms "_at the halves_," once universally prevalent in New England, sufficiently shows. In certain other matters relating to land and trade, Custom has long been gradually hardening into express law, as, for instance, the famous "Ulster Right" in Ireland. Prejudice, which is only another name for Custom, has some voice still in adjusting rates of wages, as may be seen in women's wages crowded down apparently to a point unreasonably low as compared with the wages of men; and also in the rate of John Chinaman's wages in those parts of the United States where he ventures to offer his services in the teeth of public opinion and hostile legislation. It may be spoken with general truth and satisfaction, that competition seems now to be breaking down mere custom and prejudice in all directions, and may perhaps in the good time coming reign supreme over the economic field; while Fashion, which bears indeed on one side of its shield the motto "custom," carries too on the other the bold word "competition," and this second side is likely to be presented to the public mostly in the future, because, they who lead the styles in any department whatsoever will always offer their services to Society at an advantage to themselves, that being one form of competition, and their rate of compensation will be legitimately higher than the average rate of their fellows, of which a good instance was the marked worldly prosperity during the decade of the Eighties of Worth, the man-dressmaker of Paris.

(g) _Legal Restrictions_ are another cause acting on wages, by acting directly on the Supply of laborers. Laws inhibiting or promoting immigration; laws appointing the fees and salaries of officials; tariff-taxes, whether prohibitory or only restrictive; laws creating privileged classes of any kind, which is only another designation for laws restricting the rights of the masses; unequal modes of taxation, whether adopted in ignorance or by design; all have a direct and powerful agency upon the distribution of laborers, upon the supply of them at given points, and upon the rates of their wages. Governments are coming, however, much more freely than formerly, but never through their natural choice and drift as governments, only by the gradual and oft-disappointed compulsion of their citizens, to leave all these matters Economical except the wages of their own servants and those commodities which they choose to tax, to the simple and safe action of Supply and Demand.

(h) _Voluntary Associations_ for that avowed purpose were a mediæval, and have come to be again a modern, agency in adjusting the Supply of laborers to their respective markets, and in regulating the wages of various classes of them. The Guilds of the Middle Ages, and particularly the old guilds of London, had a remarkable history, upon which we can not here even touch. Their local importance is sufficiently attested by the fact, that the City Hall of London is to this day the "Guildhall." King Edward III. humored the civic feeling of his time by becoming himself a member of the Guild of Armorers. "A seven years' apprenticeship formed the necessary prelude to full membership of any trade-guild. Their regulations were of the minutest character; the quality and value of work was rigidly prescribed, the hours of toil fixed from daybreak to curfew, and strict provision made against competition in labor. At each meeting of these guilds their members gathered round the Craft-box, which contained the rules of their Society, and stood with bared heads as it was opened. The warden and a quorum of guild-brothers formed a court which enforced the ordinances of the guild, inspected all work done by its members, confiscated unlawful tools or unworthy goods; and disobedience to their orders was punished by fines, or in the last resort by expulsion, which involved the loss of right to trade. A common fund was raised by contributions among the members, which not only provided for the trade objects of the guild, but sufficed to found chantries and masses, and set up painted windows in the church of their patron saint. Even at the present day the arms of the craft-guild may often be seen blazoned in cathedrals, side by side with those of prelates and kings."[6]

The Trades-Unions and Brotherhoods of the present day cannot plead the provocations and justifications of their mediæval predecessors. It cannot be denied, however, that they have some provocations and justifications in the bad example set before them by the various combinations (implied or explicit) of the Wages-payers as a class. If the Wages-payers combine, then the Wages-takers would seem to have no resource but in combination. Both alike are wrong in this. Both alike oppose in this the spirit of Political Economy, which is ever the spirit of Freedom, and is ever against such factitious associations for such purposes, because they tend to destroy the independence of personal action on the part of both payers and takers of wages, and tend also to bring all the workmen of any one general grade down to one level of effort and reward.

(i) Lastly, we must note the influence of _Casual Events_ upon wages, as these events affect the Supply of laborers. For example, in 1348, a terrible plague, called the Black Death, invaded England and swept away more than one-half of its population. "Even when the first burst of panic was over, the sudden rise of wages consequent on the enormous diminution in the supply of free labor, though accompanied by a corresponding rise in the price of food, rudely disturbed the course of industrial employments; harvests rotted on the ground, and fields were left untilled, not merely from scarcity of hands, but from the strife which now for the first time revealed itself between Capital and Labor" (Green). The landowners of the country districts, and the craftsmen of the towns, not understanding the law of Wages as an invariable resultant of the Demand and Supply of laborers, were scandalized by what seemed to them the extravagant demands of the new labor-class. Parliament equally ignorant with the People of the natural economic law, enacted as follows: "_Every man or woman of whatsoever condition, free or bond, able in body, and within the age of threescore years, and not having of his own whereof he may live, nor land of his own about the tillage of which he may occupy himself, and not serving any other, shall be bound to serve the employer who shall require him to do so, and shall take only the wages which were accustomed to be taken in the neighborhood where he is bound to serve two years before the plague began._" Afterwards, the runaway laborer was ordered by Parliamentary enactment to be branded in the forehead by a hot iron, and the harboring of the country serfs in the towns, in which under their civic rules a serf keeping himself a year and a day was thereafter free, was rigorously forbidden. These acts of Parliament, and many more of the same kind, were powerless to keep down wages to the old standard, but were powerful to keep up ill-blood and social discontent. They prepared the way for agitators like John Ball, for the poet-agitator Piers Ploughman, and for the great Peasant Revolt of 1381. John Ball's famous rhyme condensed the scorn for the nobles, the longing for just rule, and the resentment at oppression, of the peasants of that time and of all times:--

"When Adam delved and Eve span,
Who was then the gentleman?"

A hundred years after the Black Death the wages of a common English laborer--we have the highest authority for the statement--commanded twice the amount of the necessaries of life which could have been obtained for the wages paid under Edward III.

3. Having now seen fully the varied action of Supply and Demand upon the Value of personal services in their three kinds, we come at length to the most important general point in this chapter, namely, that in the second class of Services, those purchased in connection with the use of _Capital_, WAGES ARE ALL THE TIME ENLARGING RELATIVELY TO PROFITS. We have seen clearly already, that Cost of Labor and Cost of Capital are the only onerous elements in the cost of Commodities; because, while Natural Agents are all the time assisting and assisting more and more effectively in such production, they work without weariness or decay and without fee or reward. The reward of laborers is Wages, and the reward of capitalists is Profits; and we are now to demonstrate, that the part of their joint products falling to laborers as wages is all the while increasing as compared with the remaining part falling to capitalists as profits. This truth is of the deepest significance, and of the most cheering character; because men are more important in the universe than things; and because the number of men who sell their services as laborers is vastly greater than the number of men who sell their services as capitalists.

It is another indisputable and exhilarating truth for the masses of mankind, that the Value of each item or article of those products created by the joint action of laborers and capitalists is ever becoming less and less as measured by any relatively fixed standard as Money; so that, while wages as thus measured becomes a larger and larger aggregate as compared with the aggregate of profits, and is shared of course by a much larger number of people, those commodities looked at as a collection of items for which the wages of these many is usually expended for their own comforts, are becoming all the time cheaper and cheaper to everybody, owing to the ever-enlarging and wholly gratuitous action of natural forces.

For the sake of simplicity in the argument on this great point, we will first look at what the facts are through recent illustrations gathered by other parties for a wholly different purpose, and then give in detail the economical grounds for these patent and universal facts. Take for example, from Poor's Railroad Manual for 1889 a table showing in a graphic way the steady reduction in freight charges per ton per mile from 1865 to 1888 of seven representative Eastern trunk railroad lines, namely, the Pennsylvania, Fort Wayne and Chicago, New York Central, Michigan Central, Lake Shore, Boston and Albany, and Lake Erie and Western; and of six leading Western roads, namely, the Illinois Central, St. Paul, Burlington and Quincy, Chicago and Northwestern, Rock Island, and Chicago and Alton. The following are the figures:--

RATE CHARGES PER TON PER MILE (IN CENTS).

+------+----------+----------++------+----------+----------+
| Year.| Eastern. | Western. || Year.| Eastern. | Western. |
+------+----------+----------++------+----------+----------+
| 1865 | 2.900 | 3.642 || 1877 | .971 | 1.664 |
| 1866 | 2.503 | 3.459 || 1878 | .898 | 1.476 |
| 1867 | 2.305 | 3.175 || 1879 | .764 | 1.279 |
| 1868 | 2.132 | 3.151 || 1880 | .869 | 1.389 |
| 1869 | 1.860 | 3.026 || 1881 | .763 | 1.405 |
| 1870 | 1.593 | 2.423 || 1882 | .756 | 1.364 |
| 1871 | 1.478 | 2.509 || 1883 | .829 | 1.310 |
| 1872 | 1.504 | 2.324 || 1884 | .740 | 1.220 |
| 1873 | 1.476 | 2.188 || 1885 | .636 | 1.158 |
| 1874 | 1.332 | 2.160 || 1886 | .711 | 1.111 |
| 1875 | 1.161 | 1.979 || 1887 | .718 | 1.014 |
| 1876 | .985 | 1.877 || 1888 | .609 | .934 |
+------+----------+----------++------+----------+----------+

This reduction of rates in the case of the group of Eastern roads has amounted to 79 _per centum_, and in the Western group to 73 _per centum_, in the twenty-four years. Not less remarkable than the extent of this decline in freight charges per mile is its uniformity. Both groups show a wonderful steadiness in the progress of rate reductions. Starting at quite different points as to territorial development, they have yet travelled at a nearly equal pace in the same direction. This shows the operation of causes at once steady and universal. Statistics can never of themselves yield us _causes_; but they guide the way to them; at any rate, they prevent any radical misinterpretation of them. The great and overshadowing cause here of the cheaper freights per ton, as everywhere else of cheaper rates at the junction of efforts by capitalists and laborers, is of course the perpetual and augmenting and ever-gratuitous assistance of natural forces at every point.

While the rates of freight per ton have decreased more than three-quarters in less than one-quarter of a century in the case of these 13 railroads on the whole average, the entire cost of the operation of these roads in this interval of time has not been diminished to any appreciable extent, as also stated by the same Manual. The main item in all the operation-expenses of railroads is the wages paid to the laborers of all grades; and the laborers are quite as well paid now on these 13 roads as they were in 1865, proper allowances being made for the changed and changing standards in the national Money. If, on a broad view, railroad employees of all grades have lost nothing as such in their wages in this interval; and the general public, including these laborers and also the capitalists concerned, have greatly gained, how can we account for the immensely lessened freight-charges while the whole operation-expenses continue substantially as before?

There is only one rational account to be given of this. And it is trustworthy. All known facts jump with it, and nothing substantial can be urged against it. The gains to the masses including the capitalists and the laborers _have come out of the capitalists as such_. This is apparent as well as real. Cost of Labor and Cost of Capital is the whole cost. If the whole cost of moving one ton of freight from Boston to Chicago is 3/4 less than it was 1/4 of a century ago, the cost of the labor being the same at the two points of time, then the conclusion is inevitable, that the _cost of the capital_ at the second point is less than it was at the first point. With this conclusion all facts agree. All the laborers connected with a railroad from highest to lowest must be paid at any rate, or else the trains will certainly cease to move, whether the stockholders receive any dividend or not on their capital invested. The original _stock_--the capital that built the roads--of many if not of most the railroads in the country, has been annihilated, a new indebtedness in another form called _bonds_ having taken the place of it. Even the nominal dividends of dividend-paying roads have declined in the interval from 10 or 8 to 5 or 4 _per centum_ in the general, that is, 50 _per centum_. It is perfectly evident on every hand, that there is something in the nature and progress of things, that makes for wages as contrasted with profits: wages hold on and relatively enlarge, profits decline or go out altogether.

Fortunately we are not left to generalities here, however plain and certain these may be. One of the 13 railroads specified above, the Illinois Central, made a remarkable exhibit in its own annual Report of 1887, showing the cost of its locomotive service for each year of the thirty years preceding. This cost per mile run had fallen from 26.52 cents in 1857 to 13.93 cents in 1886. This reduction had been effected wholly on the _Capital_ side of the account, by inventions and improvements of all sorts in the _machinery_ of locomotion; while the wages of the engineers and firemen had risen in the period from 4.51 cents to 5.52 cents per mile run. The cost of the labor had risen both relatively and absolutely while the cost of the capital had declined both absolutely and relatively. In 1857 the engineers and firemen had received as wages 17% of the entire cost of the locomotive service, but in 1886 they had received 39% of that total cost. The table is as follows:--

I. C. R. R. CO.

PERFORMANCE OF LOCOMOTIVES. RELATION OF WAGES TO TOTAL COST PER MILE
RUN.

------------------------------------------------------------------------
| Cost of wages | Total cost|| | Cost of wages |Total cost
Years.| of engineers | per ||Years.| of engineers | per
|and firemen per | mile run. || | and firemen per |mile run.
| mile run. | || | mile run. |
------+----------------+-----------++------+-----------------+----------
| Cents. | Cents. || | Cents. | Cents.
1857 |Gold. { 4.51 | 26.22 || 1872 |Currency. { 5.77 | 21.76
1858 | { 3.97 | 19.81 || 1873 | { 5.84 | 21.10
1859 | { 3.81 | 20.78 || 1874 | { 6.02 | 19.57
1860 | { 3.96 | 20.17 || 1875 | { 6.03 | 19.57
1861 | { 3.84 | 18.92 || 1876 | { 5.79 | 18.81
1862 |Currency.{ 3.85 | 17.42 || 1877 | { 5.54 | 17.21
1863 | { 3.93 | 22.28 || 1878 | { 5.46 | 15.29
1864 | { 5.56 | 33.52 || 1879 |Gold. { 5.41 | 14.15
1865 | { 5.65 | 37.44 || 1880 | { 5.41 | 14.95
1866 | { 5.78 | 32.67 || 1881 | { 5.54 | 16.58
1867 | { 6.18 | 29.62 || 1882 | { 5.09 | 15.82
1868 | { 6.11 | 27.57 || 1883 | { 5.35 | 15.57
1869 | { 5.88 | 25.49 || 1884 | { 5.28 | 14.45
1870 | { 5.95 | 25.15 || 1885 | { 5.49 | 15.02
1871 | { 5.72 | 21.50 || 1886 | { 5.52 | 13.93
-----------------------------------------------------------------------

In 1857 the engineers and firemen received 17-201/1000 per cent. of
total cost.

In 1865 the engineers and firemen received 15-91/1000 per cent. of
total cost.

In 1867 the engineers and firemen received 20-865/1000 per cent. of
total cost.

In 1886 the engineers and firemen received 39-627/1000 per cent. of
total cost.

These illustrations from the railroads are plainly indicative of a general truth of the utmost importance in Political Economy, namely, _that all increase of Capital and all inventions and improvements in its practical application, while it redounds to the benefit of capitalists as a class, redounds in a still higher degree to the benefit of laborers as a class_. Let us now attend for a moment to the convincing Proof of this truth in two phases of such proof, and also to a cheering conclusion that follows it.

(a) As any country grows older in time and richer through abstinence, and as the whole world thus grows older and richer, the tendency there and everywhere towards a general decline in the rate _per centum_ for the use of capital becomes patent and universal. The rate of interest on money loaned, and the rate of profits on capital used, tend all the while to go down as and because capital accumulates. No one will dispute this as a simple fact of history. And no economist will dispute, that this is just what we might expect beforehand as a corollary from the admitted proposition, that, other things being equal, an increased Supply of anything means a lessened Value for any specific part of it. Three centuries ago in England the legal rate of interest was 10%, while now the current rate is about 4% in that country, and has been considerably lower than that in Holland, although in both countries and everywhere else there are temporary interruptions and reactions in the constant tendency now being considered. During the first years of mining operations in California, from 8% to 15% per month with security of real estate was paid for the use of money, which enormous rates long ago declined to rates not much higher than those paid in the States along the Mississippi River, and in these also the rates are all the while approximating those current in the older Eastern States, whose own rates too are slowly declining. But, while there is a less rate of profit or interest on each 100 invested, there are many more hundreds capitalized; consequently, there is an absolute gain to capitalists as a class, at once in the aggregate amount of the capital and in the aggregate sum of the profits from it, since no capitalist would have a motive to capitalize further under the smaller rates of profit, unless the aggregate of profits under the new conditions were greater than under the old condition of higher rates; and, as much of this accumulating capital in order to become productive must now be offered to laborers in the form of wages, we might almost pronounce beforehand, that it would prove both an absolute and also a _relative_ gain to laborers as a class. And so it is.

(b) Let us take to figures. An hypothesis or supposed case, whenever it may easily become an overt fact, may be reasoned from just as logically and securely as the overt fact itself. Let $100,000,000, while the rate of profit is 6%, and $500,000,000, when the rate has fallen to 4%, be expended in payment of simple wages. So far forth as that one element of cost goes, the value of the products to be divided yearly between capitalists and laborers will become respectively $106,000,000 and $520,000,000. In the first case, $6,000,000 is profits and $100,000,000 is wages; in the second case, $20,000,000 is profits and $500,000,000 is wages. Here is an absolute gain to the capitalists, since profits have gone up from $6,000,000 to $20,000,000, and so are more than _three_ times as great as before. But wages have gone up both absolutely and relatively to the rise of profits. They have risen from $100,000,000 to $500,000,000, and are _five_ times as great as before. Profits have risen as in the ratio 1:3+, but wages in the ratio of 1:5. This arithmetical example is put for the sake of illustration merely, but the principle of it holds good in every case, in which the rate _per centum_ goes down in consequence of the increase of capital in business; and, therefore, the advantages of ever-enlarging Capital are even greater to laborers as a class than to the capitalists themselves. Most assuredly, if the capitalists take less out of each hundred of the swelling hundreds now than before, the laborers must take more out of each hundred than before. Profits and Wages are reciprocally the _leavings_ of each other, because the aggregate products created by the joint agency of Capitalist and Laborer are wholly to be divided between the two. There can be no other _claimant_ even.