Various - Blackwood's Edinburgh Magazine, Volume 57, No. 355, May 1845

The mere increase of national wealth is far from being, in every instance, an addition either to national strength, national security, or national happiness. On the contrary, it is often the greatest possible diminution to the whole three. It is not the increase of wealth, but its distribution , which is the great thing to be desired. It is on that that the welfare and happiness of society depend. When wealth, whether in capital or revenue, runs into a few hands – when landed property accumulates in the persons of a knot of territorial magnates, and commerce centres in the warehouse of a limited number of merchant princes, and manufactures in the workshop of a small body of colossal companies or individual master-employers, it is absolutely certain that the great bulk of the people will be in a state of degradation and distress. The reason is, that these huge fortunes have been made by diminishing the cost of production – that is, the wages of labour – to such an extent, as to have enormously and unjustly increased the profits of the stock employed in conducting it. Society, in such circumstances, is in the unstable equilibrium: it rests on the colossal wealth, territorial or commercial, of a few; but it has no hold on the affections or interests of the great majority of the community. It is liable to be overturned by the first shock of adverse fortune. Any serious external disaster, any considerable internal suffering, may at once overturn the whole fabric of society, and expose the wealth of the magnates only as a tempting plunder to the cupidity and recklessness of the destitute classes of society. "There is as much true philosophy as poetry," says Sismondi, "in the well-known lines of Goldsmith —

The Chrematists always represent an increase of national wealth as necessarily flowing from an augmentation of the riches of the individuals who compose it. But this is the greatest possible mistake. Great part of the riches obtained by individuals in a state, so far from being an addition to the national wealth, is an abstraction from it. The reason is, that it is made at the expense of others in the same community; it is a transference of riches from one hand to another, not an addition to their total amount. Every one sees that the gains of the gamester, the opera-dancer, the lawyer, are of this description; what they take is taken from others in the same community. But the magnitude of the gains of merchants and manufacturers blinds the world to the real nature of their profits, which, in great part at least, are made at the expense of others in the state. If the importing merchant makes extravagant gains, he indeed is enriched; but how is he enriched? In part, at least, he is so, by impoverishing such of his countrymen as purchase his goods at the exorbitant price which constitute his profits. If the exporting merchant or manufacturer drives a gainful trade, it is in part, without doubt, derived from the industry of foreign nations to whom the export goods are sold; but it is too often earned at the expense also of the workmen he employs, who have been compelled by competition, or destitution, to sell their labour to him at a rate barely sufficient for the support of existence. We are not to flatter ourselves that the nation is becoming rich, because the exporters of Irish grain, Paisley shawls, or Manchester cotton goods, are making fortunes, when the labourers they employ are earning from sixpence to eightpence a-day only. On the contrary, the magnitude of the gains of the former is too often only a measure of the destitution and degradation of the latter.

It is usually considered that it is a sufficient answer to this to observe, that if riches are thus, from the direction which national industry has taken, drawn to a distressing extent from one class of the community to concentrate them in another, a corresponding benefit is conferred upon other classes, by the increased expenditure which takes place on the part of those, in whose hands the wealth has accumulated. There can be no doubt that a certain compensation does take place in this way; and it is the existence of that compensation, which alone renders society tolerable under such circumstances. But the benefit accruing is no adequate set-off, if society be viewed as a whole, to the evil incurred. If two millions of Irish labourers are working at sixpence a-day each, and two millions more of human beings, in the Emerald Isle, are in a state of destitution, it is a poor compensation for such a dreadful state of things to observe, that some hundred Irish noblemen, or absentee proprietors, are spending ten or twenty thousand a-year each amidst the luxuries of London, Paris, or Naples; and that they sometimes extract five or six guineas an acre from their starving tenants. If weavers in Renfrewshire, and cotton operatives in Lancashire, are making cotton cloths at eightpence a-day of wages, we are not to be deluded into the belief that society is prosperous, because every year six or eight cotton lords buy estates for a hundred thousand pounds a-piece; and one-half of the railways in the kingdom are constructed with the wealth of Manchester and Glasgow. There are no two things more different than national riches and the wealth of the rich in a nation.

It is the fatal and ruinous effect of wealth, thus accumulated in the hands of a few, at the expense of the great bulk of the industrious classes in a state, that it tends to perpetuate and increase the diseased and perilous state of society from which it sprang. The common observations, that money makes money, and that poverty breeds poverty, show how universally the experience of mankind has felt that capital, in the long run, gives an overwhelming advantage in the race for riches to the rich, and that poverty as uniformly, erelong, gives the vast superiority in numbers to the poor. We often hear of an earl or a merchant-prince mourning the want of an heir, but scarcely ever of a Highland couple or an Irish hovel wanting their overflowing brood of little half-naked savages. We occasionally hear of a poor man raising himself by talent and industry to fortune; but in general he does so only by associating his skill with some existing capital, and giving its owner thus the extraordinary advantage of uniting old wealth with a new discovery. To get on in the world without capital is daily becoming more difficult to the great bulk of men: it is, in trade or commerce, at least, wholly impossible. Thus, as wealth accumulates in the capital and great cities of the empire, destitution, poverty, and, of course, crime and immorality, multiply around the seats where that wealth was originally created. And this evil, so far from abating with the lapse of time, daily increases, and must increase till some dreadful convulsion takes place, and restores the subverted balance of society; because the power of capital, like that of a lever which is continually lengthened, is daily augmenting in the centres of wealth; and the power of numbers in the centres of destitution is hourly on the increase, from the reckless and improvident habits which that destitution has engendered.

The happiness of a nation, its morality, order, and security, are mainly, if not entirely, dependent on the extent to which property with its attendant blessings, and habits of reflection, regularity, and industry, are diffused among the people. But the doctrines of the Chrematists , and of nearly the whole school of modern political economists, go almost entirely to uproot this inestimable blessing. The principle being once fixed in men's minds, and acted upon by individual men and the legislature, that the great thing is to diminish the cost of production , it follows, as a very natural consequence, that the main thing is to diminish the wages of the producers . Every thing which can conduce to that object is vigorously pursued, without the slightest regard to the effect the changes must have on the fortunes, and ultimate fate in life, of whole classes in society. It is thus that, in agriculture, the engrossing of farms takes place – an evil so sorely felt in England during the seventeenth, and in Scotland in the eighteenth and nineteenth centuries – and that hundreds and thousands of happy families are dispossessed from their hereditary possessions, to make room for that "devourer of the human race," as the old writers called it, the sheep. It is thus that, in our own times, the small tenants and cotters have been so generally dispossessed in Scotland and Ireland, to make room for the large cultivator or store farmer. It is thus that the race of hand-loom weavers, who carry on their trade in their own houses, and with the advantages of rural residence, gardens, fields, and country air, is every where becoming extinct, or their wages have fallen so low as barely to support existence in the very humblest rank of life. In the room of these sturdy old children of the soil, has sprung up a race of puny operatives or labourers, living by wages, and having no durable connexion either with the land, or even with the capitalist who employs them. Employed at weekly wages, they are constantly on the verge of famine if turned out of their employment. Every thing now is concentrated in huge mills, manufacturing districts, and great towns, where the labour of men is too often supplanted by women, that of women by children, that of children almost entirely by machinery, on which they attend. The cost of production, indeed, is prodigiously diminished, by the substitute of these feeble or tiny labourers for that of full-grown men; and with it the profits of the masters, and the circle of the export sale, are proportionally augmented; but at what expense is this profit to a few gained? At the expense, in some degree, at least, it is to be feared, of the independence, the comfort, the morals, the lives, of whole classes of the labouring portions of the community.