Capital–The Mother of Labour

An Economical Problem Discussed from a Physiological Point of View (March 1890)

Collected Essays IX

[147] THE first act of a new-born child is to draw a deep breath. In fact, it will never draw a deeper, inasmuch as the passages and chambers of the lungs, once distended with air, do not empty themselves again; it is only a fraction of their contents which passes in and out with the flow and the ebb of the respiratory tide. Mechanically, this act of drawing breath, or inspiration, is of the same nature as that by which the handles of a bellows are separated, in order to fill the bellows with air; and, in like manner, it involves that expenditure of energy which we call exertion, or work, or labour. It is, therefore, no mere metaphor to say that man is destined to a life of toil: the work of respiration which began with his first breath ends only with his last; nor does one born [148] in the purple get off with a lighter task than the child who first sees light under a hedge.

How is it that the new-born infant is enabled to perform this first instalment of the sentence of life-long labour which no man may escape? Whatever else a child may be, in respect of this particular question, it is a complicated piece of mechanism, built up out of materials supplied by its mother; and in the course of such building-up, provided with a set of motors–the muscles. Each of these muscles contains a stock of substance capable of yielding energy under certain conditions, one of which is a change of state in the nerve fibres connected with it. The powder in a loaded gun is such another stock of substance capable of yielding energy in consequence of a change of state in the mechanism of the lock, which intervenes between the finger of the man who pulls the trigger and the cartridge. If that change is brought about, the potential energy of the powder passes suddenly into actual energy, and does the work of propelling the bullet. The powder, therefore, may be appropriately called work-stuff, not only because it is stuff which is easily made to yield work in the physical sense, but because a good deal of work in the economical sense has contributed to its production. Labour was necessary to collect, transport, and purify the raw sulphur and saltpetre; to cut wood and convert it into powdered charcoal; to mix these in[149]gredients in the right proportions; to give the mixture the proper grain, and so on. The powder once formed part of the stock, or capital, of a powder-maker: and it is not only certain natural bodies which are collected and stored in the gunpowder, but the labour bestowed on the operations mentioned may be figuratively said to be incorporated in it.

In principle, the work-stuff stored in the muscles of the new-born child is comparable to that stored in the gun-barrel. The infant is launched into altogether new surroundings; and these operate through the mechanism of the nervous machinery, with the result that the potential energy of some of the work-stuff in the muscles which bring about inspiration is suddenly converted into actual energy; and this, operating through the mechanism of the respiratory apparatus, gives rise to an act of inspiration. As the bullet is propelled by the "going off" of the powder, as it might be said that the ribs are raised and the midriff depressed by the "going off" of certain portions of muscular work-stuff. This work-stuff is part of a stock or capital of that commodity stored up in the child's organism before birth, at the expense of the mother; and the mother has made good her expenditure by drawing upon the capital of food-stuffs which furnished her daily maintenance.

Under these circumstances, it does not appear [150] to me to be open to doubt that the primary act of outward labour in the series which necessarily accompany the life of man is dependent upon the pre-existence of a stock of material which is not only of use to him, but which is disposed in such a manner as to be utilisable with facility. And I further imagine that the propriety of the application of the term 'capital' to this stock of useful substance cannot be justly called in question; inasmuch as it is easy to prove that the essential constituents of the work-stuff accumulated in the child's muscles have merely been transferred from the store of food-stuffs, which everybody admits to be capital, by means of the maternal organism to that of the child, in which they are again deposited to await use. Every subsequent act of labour, in like manner, involves an equivalent consumption of the child's store of work-stuff–its vital capital; and one of the main objects of the process of breathing is to get rid of some of the effects of that consumption. It follows, then, that, even if no other than the respiratory work were going on in the organism, the capital of work-stuff, which the child brought with it into the world, must sooner or later be used up, and the movements of breathing must come to an end; just as the see-saw of the piston of a steam-engine stops when the coal in the fireplace has burnt away.

Milk, however, is a stock of materials which [151] essentially consists of savings from the food-stuffs supplied to the mother. And these savings are in such a physical and chemical condition that the organism of the child can easily convert them into work-stuff. That is to say, by borrowing directly from the vital capital of the mother, indirectly from the store in the natural bodies accessible to her, it can make good the loss of its own. The operation of borrowing, however, involves further work; that is, the labour of sucking, which is a mechanical operation of much the same nature as breathing. The child thus pays for the capital it borrows in labour; but as the value in work-stuff of the milk obtained is very far greater than the value of that labour, estimated by the consumption of work-stuff it involves, the operation yields a large profit to the infant. The overplus of food-stuff suffices to increase the child's capital of work-stuff; and to supply not only the materials for the enlargement of the "buildings and machinery" which is expressed by the child's growth, but also the energy required to put all these materials together, and to carry them to their proper places. Thus, throughout the years of infancy, and so long thereafter as the youth or man is not thrown upon his own resources, he lives by consuming the vital capital provided by others. To use a terminology which is more common than appropriate, whatever work he performs (and he does [152] a good deal, if only in mere locomotion) is unproductive.

Let us now suppose the child come to man's estate in the condition of a wandering savage, dependent for his food upon what he can pick up or catch, after the fashion of the Australian aborigines. It is plain that the place of mother, as the supplier of vital capital, is now taken by the fruits, seeds, and roots of plants and by various kinds of animals. It is they alone which contain stocks of those substances which can be converted within the man's organism into work-stuff; and of the other matters, except air and water, required to supply the constant consumption of his capital and to keep his organic machinery going. In no way does the savage contribute to the production of these substances. Whatever labour he bestows upon such vegetable and animal bodies, on the contrary, is devoted to their destruction; and it is a mere matter of accident whether a little labour yields him a great deal–as in the case, for example, of a stranded whale; or whether much labour yields next to nothing–as in times of long-continued drought. The savage, like the child, borrows the capital he needs, and, at any rate, intentionally, does nothing towards repayment; it would plainly be an improper use of the word "produce" to say that his labour in hunting for the roots, or the fruits, or the eggs, or the grubs and snakes, which he finds and eats, "pro[153]duces" or contributes to "produce" them. The same thing is true of more advanced tribes, who are still merely hunters, such as the Esquimaux. They may expend more labour and skill; but it is spent in destruction.

When we pass from these to men who lead a purely pastoral life, like the South American Gauchos, or some Asiatic nomads, there is an important change. Let us suppose the owner of a flock of sheep to live on the milk, cheese, and flesh which they yield. It is obvious that the flock stands to him in the economic relation of the mother to the child, inasmuch as it supplies him with food-stuffs competent to make good the daily and hourly losses of his capital of workstuff. If we imagine our sheep-owner to have access to extensive pastures and to be troubled neither by predacious animals nor by rival shepherds, the performance of his pastoral functions will hardly involve the expenditure of any more labour than is needful to provide him with the exercise required to maintain health. And this is true, even if we take into account the trouble originally devoted to the domestication of the sheep. It surely would be a most singular pretension for the shepherd to talk of the flock as the "produce" of his labour in any but a very limited sense. In truth, his labour would have been a mere accessory of production of very little consequence. Under the circumstances supposed, [154] a ram and some ewes, left to themselves for a few years, would probably generate as large a flock; and the superadded labour of the shepherd would have little more effect upon their production than upon that of the blackberries on the bushes about the pastures. For the most part the increment would be thoroughly unearned; and, if it is a rule of absolute political ethics that owners have no claim upon "betterment" brought about independently of their own labour, then the shepherd would have no claim to at least nine-tenths of the increase of the flock.

But if the shepherd has no real claim to the title of "producer," who has? Are the rams and ewes the true "producers"? Certainly their title is better if, borrowing from the old terminology of chemistry, they only claim to be regarded as the "proximate principles" of production. And yet, if strict justice is to be dispensed, even they are to be regarded rather as collectors and distributors than as "producers." For all that they really do is to collect, slightly modify, and render easily accessible, the vital capital which already exists in the green herbs on which they feed, but in such a form as to be practically out of the reach of man.

Thus, from an economic point of view, the sheep are more comparable to confectioners than to producers. The usefulness of biscuit lies in the raw flour of which it is made; but raw flour [156] does not answer as an article of human diet, and biscuit does. So the usefulness of mutton lies mainly in certain chemical compounds which it contains: the sheep gets them out of grass; we cannot live on grass, but we can on mutton.

Now, herbaceous and all other green plants stand alone among terrestrial natural bodies, in so far as, under the influence of light, they possess the power to build up, out of the carbonic acid gas in the atmosphere, water and certain nitrogenous and mineral salts, those substances which in the animal organism are utilised as work-stuff. They are the chief and, for practical purposes, the sole producers of that vital capital which we have seen to be the necessary antecedent of every act of labour. Every green plant is a laboratory in which, so long as the sun shines upon it, materials furnished by the mineral world, gases, water, saline compounds, are worked up into those foodstuffs without which animal life cannot be carried on. And since, up to the present time, synthetic chemistry has not advanced so far as to achieve this feat, the green plant may be said to be the only living worker whose labour directly results in the production of that vital capital which is the necessary antecedent of human labour.1 Nor is this statement a paradox involving perpetual [156] motion, because the energy by which the plant does its work is supplied by the sun–the primordial capitalist so far as we are concerned. But it cannot be too strongly impressed upon the mind that sunshine, air, water, the best soil that is to be found on the surface of the earth, might co-exist; yet without plants, there is no known agency competent to generate the so-called "protein compounds," by which alone animal life can be permanently supported. And not only are plants thus essential; but, in respect of particular kinds of animals, they must be plants of a particular nature. If there were no terrestrial green plants but, say, cypresses and mosses, pastoral and agricultural life would be alike impossible; indeed, it is difficult to imagine the possibility of the existence of any large animal, as the labour required to get at a sufficiency of the store of food-stuffs, contained in such plants as these, could hardly extract from them an equivalent for the waste involved in that expenditure of work.

We are compact of dust and air; from that we set out, and to that complexion must we come at last. The plant either directly, or by some animal intermediary, lends us the capital which enables us to carry on the business of life, as we flit through the upper world, from the one term of our journey to the other. Popularly, no doubt, it is permissible to speak of the soil as a "pro[157]ducer," just as we may talk of the daily movement of the sun. But, as I have elsewhere remarked, propositions which are to bear any deductive strain that may be put upon them must run the risk of seeming pedantic, rather than that of being inaccurate. And the statement that land, in the sense of cultivable soil, is a producer, or even one of the essentials of economic production, is anything but accurate. The process of water-culture, in which a plant is not "planted" in any soil, but is merely supported in water containing in solution the mineral ingredients essential to that plant, is now thoroughly understood; and, if it were worth while, a crop yielding abundant food-stuffs could be raised on an acre of fresh water, no less than on an acre of dry land. In the Arctic regions, again, land has nothing to do with "production" in the social economy of the Esquimaux, who live on seals and other marine animals; and might, like Proteus, shepherd the flocks of Poseidon if they had a mind for pastoral life. But the seals and the bears are dependent on other inhabitants of the sea, until, somewhere in the series, we come to the minute green plants which float in the ocean, and are the real "producers" by which the whole of its vast animal population is supported.2

[158] Thus, when we find set forth as an "absolute" truth the statement that the essential factors in economic production are land, capital and labour–when this is offered as an axiom whence all sorts of other important truths may be deduced–it is needful to remember that the assertion is true only with a qualification. Undoubtedly "vital capital" is essential; for, as we have seen, no human work can be done unless it exists, not even that internal work of the body which is necessary to passive life. But, with respect to labour (that is, human labour) I hope to have left no doubt on the reader's mind that, in regard to production, the importance of human labour may be so small as to be almost a vanishing quantity. Moreover, it is certain that there is no approximation to a fixed ratio between the expenditure of labour and the production of that vital capital which is the foundation of all wealth. For, suppose that we introduce into our suppositious pastoral paradise beasts of prey and rival shepherds, the amount of labour thrown upon the sheep-owner may increase almost indefinitely, and its importance as a condition of production may be enormously augmented, while the quantity of produce remains stationary. Compare for a moment the unim[159]portance of the shepherd's labour, under the circumstances first defined, with its indispensability in countries in which the water for the sheep has to be drawn from deep wells, or in which the flock has to be defended from wolves or from human depredators. As to land, it has been shown that, except as affording mere room and standing ground, the importance of land, great as it may be, is secondary. The one thing needful for economic production is the green plant, as the sole producer of vital capital from natural inorganic bodies. Men might exist without labour (in the ordinary sense) and without land; without plants they must inevitably perish.

That which is true of the purely pastoral condition is a fortiori true of the purely agricultural3 condition, in which the existence of the cultivator is directly dependent on the production of vital capital by the plants which he cultivates. Here, again, the condition precedent of the work of each year is vital capital. Suppose that a man lives exclusively upon the plants which he cultivates. It is obvious that he must have food-stuffs to live upon, while he prepares the soil for sowing and throughout the period which elapses between this and harvest. These food-stuffs must be yielded by the stock remaining over from former crops. [160] The result is the same as before–the pre-existence of vital capital is the necessary antecedent of labour. Moreover, the amount of labour which contributes, as an accessory condition, to the production of the crop varies as widely in the case of plant-raising as in that of cattle-raising. With favourable soil, climate and other conditions, it may be very small, with unfavourable, very great, for the same revenue or yield of food-stuffs.

Thus, I do not think it is possible to dispute the following proposition: the existence of any man, or of any number of men, whether organised into a polity or not, depends on the production of foodstuffs (that is, vital capital) readily accessible to man, either directly or indirectly, by plants. But it follows that the number of men who can exist, say for one year, on any given area of land, taken by itself, depends upon the quantity of food-stuffs produced by such plants growing on the area in one year. If a is that quantity, and b the minimum of food-stuffs required for each man, a/b = n, the maximum number of men who can exist on the area. Now the amount of production (a) is limited by the extent of area occupied; by the quantity of sunshine which falls upon the area; by the range and distribution of temperature; by the force of the winds; by the supply of water; by the composition and the physical characters of the soil; by animal and vegetable competitors and des[161]troyers. The labour of man neither does, nor can, produce vital capital; all that it can do is to modify, favourably or unfavourably, the conditions of its production. The most important of these–namely, sunshine, range of daily and nightly temperature, wind–are practically out of men's reach.4 On the other hand, the supply of water, the physical and chemical qualities of the soil, and the influences of competitors and destroyers, can often, though by no means always, be largely affected by labour and skill. And there is no harm in calling the effect of such labour "production," if it is clearly understood that "production" in this sense is a very different thing from the "production" of food-stuffs by a plant.

We have been dealing hitherto with suppositions the materials of which are furnished by everyday experience, not with mere a priori assumptions. Our hypothetical solitary shepherd with his flock, or the solitary farmer with his grain field, are mere bits of such experience, cut out, as it were, for easy study. Still borrowing from daily experience, let us suppose that either sheep-owner or farmer, for any reason that may be imagined, [162] desires the help of one or more other men; and that, in exchange for their labour, he offers so many sheep, or quarts of milk, or pounds of cheese, or so many measures of grain, for a year's service. I fail to discover any a priori "rights of labour" in virtue of which these men may insist on being employed, if they are not wanted. But, on the other hand, I think it is clear that there is only one condition upon which the persons to whom the offer of these "wages" is made can accept it; and that is that the things offered in exchange for a year's work shall contain at least as much vital capital as a man uses up in doing the year's work. For no rational man could knowingly and willingly accept conditions which necessarily involve starvation. Therefore there is an irreducible minimum of wages; it is such an amount of vital capital as suffices to replace the inevitable consumption of the person hired. Now, surely, it is beyond a doubt that these wages, whether at or above the irreducible minimum, are paid out of the capital disposable after the wants of the owner of the flock or of the crop of grain are satisfied; and, from what has been said already, it follows that there is a limit to the number of men, whether hired, or brought in in any other way, who can be maintained by the sheepowner or landowner out of his own resources. Since no amount of labour can produce an ounce of foodstuff beyond the maximum producible by a limited [163] number of plants, under the most favourable circumstances in regard to those conditions which are not affected by labour, it follows that, if the number of men to be fed increases indefinitely, a time must come when some will have to starve. That is the essence of the so-called Malthusian doctrine; and it is a truth which, to my mind, is as plain as the general proposition that a quantity which constantly increases will, some time or other, exceed any greater quantity the amount of which is fixed.

The foregoing considerations leave no doubt about the fundamental condition of the existence of any polity, or organised society of men, either in a purely pastoral or purely agricultural state, or in any mixture of both states. It must possess a store of vital capital to start with, and the means of repairing the consumption of that capital which takes place as a consequence of the work of the members of the society. And, if the polity occupies a completely isolated area of the earth's surface, the numerical strength of that polity can never exceed the quotient of the maximum quantity of food-stuffs producible by the green plants on that area, in each year, divided by the quantity necessary for the maintenance of each person during the year. But, there is a third mode of existence possible to a polity; it may, conceivably, be neither purely pastoral nor purely agricultural, but purely manufacturing. Let us [164] suppose three islands, like Gran Canaria, Teneriffe and Lanzerote, in the Canaries, to be quite cut off from the rest of the world. Let Gran Canaria be inhabited by grain-raisers, Teneriffe by cattle-breeders; while the population of Lanzerote (which we may suppose to be utterly barren) consists of carpenters, woollen manufacturers, and shoemakers. Then the facts of daily experience teach us that the people of Lanzerote could never have existed unless they came to the island provided with a stock of food-stuffs; and that they could not continue to exist, unless that stock, as it was consumed, was made up by contributions from the vital capital of either Gran Canaria, or Teneriffe, or both. Moreover, the carpenters of Lanzerote could do nothing, unless they were provided with wood from the other islands; nor could the wool spinners and weavers or the shoemakers work without wool and skins from the same sources. The wood and the wool and the skins are, in fact, the capital without which their work as manufacturers in their respective trades is impossible–so that the vital and other capital supplied by Gran Canaria and Teneriffe is most indubitably the necessary antecedent of the industrial labour of Lanzerote. It is perfectly true that by the time the wood, the wool, and the skins reached Lanzerote a good deal of labour in cutting, shearing, skinning, transport, and so on, would have been spent upon them. But this [165] does not alter the fact that the only "production" which is essential to the existence of the population of Teneriffe and Gran Canaria is that effected by the green plants in both islands; and that all the labour spent upon the raw produce useful in manufacture, directly or indirectly yielded by them–by the inhabitants of these islands and by those of Lanzerote into the bargain–will not provide one solitary Lanzerotian with a dinner, unless the Teneriffians and Canariotes happen to want his goods and to be willing to give some of their vital capital in exchange for them.

Under the circumstances defined, if Teneriffe and Gran Canaria disappeared, or if their inhabitants ceased to care for carpentry, clothing, or shoes, the people of Lanzerote must starve. But if they wish to buy, then the Lanzerotians, by "cultivating" the buyers, indirectly favour the cultivation of the produce of those buyers.

Thus, if the question is asked whether the labour employed in manufacture in Lanzerote is "productive" or "unproductive" there can be only one reply. If anybody will exchange vital capital, or that which can be exchanged for vital capital, for Lanzerote goods, it is productive; if not, it is unproductive.

In the case of the manufacturer, the dependence of labour upon capital is still more intimate than in that of the herdsman or agriculturist. When the latter are once started they can go on, without [166] troubling themselves about the existence of any other people. But the manufacturer depends on pre-existing capital, not only at the beginning, but at the end of his operations. However great the expenditure of his labour and of his skill, the result, for the purpose of maintaining his existence, is just the same as if he had done nothing, unless there is a customer able and willing to exchange food-stuffs for that which his labour and skill have achieved.

There is another point concerning which it is very necessary to have clear ideas. Suppose a carpenter in Lanzerote to be engaged in making chests of drawers. Let us suppose that a, the timber, and b, the grain and meat needful for the man's sustenance until he can finish a chest of drawers, have to be paid for by that chest. Then the capital with which he starts is represented by a + b. He could not start at all unless he had it; day by day, he must destroy more or less of the substance and of the general adaptability of a in order to work it up into the special forms needed to constitute the chest of drawers; and, day by day, he must use up at least so much of b as will replace his loss of vital capital by the work of that day. Suppose it takes the carpenter and his workmen ten days to saw up the timber, to plane the boards, and to give them the shape and size proper for the various parts of the chest of drawers. And suppose that he then [167] offers his heap of boards to the advancer of a + b as an equivalent for the wood + ten days' supply of vital capital? The latter will surely say: "No. I did not ask for a heap of boards. I asked for a chest of drawers. Up to this time, so far as I am concerned, you have done nothing and are as much in my debt as ever." And if the carpenter maintained that he had "virtually" created two-thirds of a chest of drawers, inasmuch as it would take only five days more to put together the pieces of wood, and that the heap of boards ought to be accepted as the equivalent of two-thirds of his debt, I am afraid the creditor would regard him as little better than an impudent swindler. It obviously makes no sort of difference whether the Canariote or Teneriffian buyer advanced the wood and the food-stuffs, on which the carpenter had to maintain himself; or whether the carpenter had a stock of both, the consumption of which must be recouped by the exchange of a chest of drawers for a fresh supply. In the latter case, it is even less doubtful that, if the carpenter offered his boards to the man who wanted a chest of drawers, the latter would laugh in his face. And if he took the chest of drawers for himself, then so much of his vital capital would be sunk in it past recovery. Again, the payment of goods in a lump, for the chest of drawers, comes to the same thing as the payment of daily wages for the fifteen days that [168] the carpenter was occupied in making it. If, at the end of each day, the carpenter chose to say to himself "I have 'virtually' created, by my day's labour, a fifteenth of what I shall get for the chest of drawers–therefore my wages are the produce of my day's labour"–there is no great harm in such metaphorical speech, so long as the poor man does not delude himself into the supposition that it represents the exact truth. "Virtually" is apt to cover more intellectual sins than "charity" does moral delicts. After what has been said, it surely must be plain enough that each day's work has involved the consumption of the carpenter's vital capital, and the fashioning of his timber, at the expense of more or less consumption of those forms of capital. Whether the a + b to be exchanged for the chest has been advanced as a loan, or is paid daily or weekly as wages, or, at some later time, as the price of a finished commodity–the essential element of the transaction, and the only essential element, is, that it must, at least, effect the replacement of the vital capital consumed. Neither boards nor chest of drawers are eatable; and, so far from the carpenter having produced the essential part of his wages by each day's labour, he has merely wasted that labour, unless somebody who happens to want a chest of drawers offers to exchange vital capital, or something that can procure it, equivalent to the [169] amount consumed during the process of manufacture.5

That it should be necessary, at this time of day, to set forth such elementary truths as these may well seem strange; but no one who consults that interesting museum of political delusions, "Progress and Poverty," some of the treasures of which I have already brought to light, will doubt the fact, if he bestows proper attention upon the first book of that widely-read work. At page 15 it is thus written:

"The proposition I shall endeavour to prove is: that wages, instead of being drawn from capital, are, in reality, drawn from the product of the labour for which they are paid."

Again at page 18:–

"In every case in which labour is exchanged for commodities, production really precedes enjoyment . . . wages are the earnings–that is to say, the makings–of labour–not the advances of capital."

And the proposition which the author endeavours to disprove is the hitherto generally accepted doctrine

"that labour is maintained and paid out of existing capital, before the product which constitutes the ultimate object is secured" (p. 16).

The doctrine respecting the relation of capital and wages, which is thus opposed in "Progress and [170] Poverty," is that illustrated in the foregoing pages; the truth of which, I conceive, must be plain to any one who has apprehended the very simple arguments by which I have endeavoured to demonstrate it. One conclusion or the other must be hopelessly wrong; and, even at the cost of going once more over some of the ground traversed in this essay and that on "Natural and Political Rights,"6 I propose to show that the error lies with "Progress and Poverty"; in which work, so far as political science is concerned, the poverty is, to my eye, much more apparent than the progress.

To begin at the beginning. The author propounds a definition of wealth: "Nothing which nature supplies to man without his labour is wealth" (p. 28). Wealth consists of "natural substances or products which have been adapted by human labour to human use or gratification, their value depending upon the amount of labour which, upon the average, would be required to produce things of like kind" (p. 27). The following examples of wealth are given:–

"Buildings, cattle, tools, machinery, agricultural and mineral products, manufactured goods, ships, waggons, furniture, and the like" (p. 27).

I take it that native metals, coal and brick clay, are "mineral products"; and I quite believe that they are properly termed "wealth." But when a seam of coal crops out at the surface, and [171] lumps of coal are to be had for the picking up; or when native copper lies about in nuggets, or when brick clay forms a superficial stratum, it appears to me that these things are supplied to, nay almost thrust upon, man without his labour. According to the definition, therefore, they are not "wealth." According to the enumeration, however, they are "wealth": a tolerably fair specimen of a contradiction in terms. Or does "Progress and Poverty" really suggest that a coal seam which crops out at the surface is not wealth; but that if somebody breaks off a piece and carries it away, the bestowal of this amount of labour upon that particular lump makes it wealth; while the rest remains "not wealth"? The notion that the value of a thing bears any necessary relation to the amount of labour (average or otherwise) bestowed upon it, is a fallacy which needs no further refutation than it has already received. The average amount of labour bestowed upon warming-pans confers no value upon them in the eyes of a Gold-Coast negro; nor would an Esquimaux give a slice of blubber for the most elaborate of ice-machines.

So much for the doctrine of "Progress and Poverty" touching the nature of wealth. Let us now consider its teachings respecting capital as wealth or a part of wealth. Adam Smith's definition "that part of a man's stock which he expects to yield him a revenue is called his capital" is quoted with approval (p. 32); else[172]where capital is said to be that part of wealth "which is devoted to the aid of production" (p. 28); and yet again it is said to be

"wealth in course of exchange,7 understanding exchange to include, not merely the passing from hand to hand, but also such transmutations as occur when the reproductive or transforming forces of nature are utilised for the increase of wealth" (p. 32).

But if too much pondering over the possible senses and scope of these definitions should weary the reader, he will be relieved by the following acknowledgment:–

"Nor is the definition of capital I have suggested of any importance" (p. 33).

The author informs us, in fact, that he is "not writing a text-book," thereby intimating his opinion that it is less important to be clear and accurate when you are trying to bring about a political revolution than when a merely academic interest attaches to the subject treated. But he is not busy about anything so serious as a textbook: no, he "is only attempting to discover the laws which control a great social problem"–a mode of expression which indicates perhaps the high-water mark of intellectual muddlement. I have heard, in my time, of "laws" which control other "laws"; but this is the first occasion on which "laws" which "control a problem" have come under my notice. Even the disquisitions "of [173] those flabby writers who have burdened the press and darkened counsel by numerous volumes which are dubbed political economy" (p. 28) could hardly furnish their critics with a finer specimen of that which a hero of the "Dunciad," by the one flash of genius recorded of him, called "clotted nonsense."

Doubtless it is a sign of grace that the author of these definitions should attach no importance to any of them; but since, unfortunately, his whole argument turns upon the tacit assumption that they are important, I may not pass them over so lightly. The third I give up. Why anything should be capital when it is "in course of exchange," and not be capital under other circumstances, passes my understanding. We are told that "that part of a farmer's crop held for sale or for seed, or to feed his help, in part payment of wages, would be accounted capital; that held for the care of his family would not be" (p. 31). But I fail to discover any ground of reason or authority for the doctrine that it is only when a crop is about to be sold or sown, or given as wages, that it may be called capital. On the contrary, whether we consider custom or reason, so much of it as is stored away in ricks and barns during harvest, and remains there to be used in any of these ways months or years afterwards, is customarily and rightly termed capital. Surely, the meaning of the clumsy phrase that capital is "wealth in the course of exchange" must be that it is "wealth capable of [174] being exchanged" against labour or anything else. That, in fact, is the equivalent of the second definition, that capital is "that part of wealth which is devoted to the aid of production." Obviously, if you possess that for which men will give labour, you can aid production by means of that labour. And, again, it agrees with the first definition (borrowed from Adam Smith) that capital is "that part of a man's stock which he expects to yield him a revenue." For a revenue is both etymologically and in sense a "return." A man gives his labour in sowing grain, or in tending cattle, because he expects a "return"–a "revenue"–in the shape of the increase of the grain or of the herd; and also, in the latter case, in the shape of their labour and manure which "aid the production" of such increase. The grain and cattle of which he is possessed immediately after harvest is his capital; and his revenue for the twelvemonth, until the next harvest, is the surplus of grain and cattle over and above the amount with which he started. This is disposable for any purpose for which he may desire to use it, leaving him just as well off as he was at the beginning of the year. Whether the man keeps the surplus grain for sowing more land, and the surplus cattle for occupying more pasture; whether he exchanges them for other commodities, such as the use of the land (as rent); or labour (as wages); or whether he feeds himself and his [175] family, in no way alters their nature as revenue, or affects the fact that this revenue is merely disposable capital.

That (even apart from etymology) cattle are typical examples of capital cannot be denied ("Progress and Poverty," p. 25); and if we seek for that particular quality of cattle which makes them "capital," neither has the author of "Progress and Poverty" supplied, nor is any one else very likely to supply, a better account of the matter than Adam Smith has done. Cattle are "capital" because they are "stock which yields revenue." That is to say, they afford to their owner a supply of that which he desires to possess. And, in this particular case, the "revenue" is not only desirable, but of supreme importance, inasmuch as it is capable of maintaining human life. The herd yields a revenue of food-stuffs as milk and meat; a revenue of skins; a revenue of manure; a revenue of labour; a revenue of exchangeable commodities in the shape of these things, as well as in that of live cattle. In each and all of these capacities cattle are capital; and, conversely, things which possess any or all of these capacities are capital.

Therefore what we find at page 25 of "Progress and Poverty" must be regarded as a welcome lapse into clearness of apprehension:–

"A fertile field, a rich vein of ore, a falling stream which supplies power, may give the possessor advantages equivalent to the [176] possession of capital; but to class such things as capital would be to put an end to the distinction between land and capital."

Just so. But the fatal truth is that these things are capital; and that there really is no fundamental distinction between land and capital. Is it denied that a fertile field, a rich vein of ore, or a falling stream, may form part of a man's stock, and that, if they do, they are capable of yielding revenue? Will not somebody pay a share of the produce in kind, or in money, for the privilege of cultivating the first royalties for that of working the second; and a like equivalent for that of erecting a mill on the third? In what sense, then, are these things less "capital" than the buildings and tools which on page 27 of "Progress and Poverty" are admitted to be capital? Is it not plain that if these things confer "advantages equivalent to the possession of capital," and if the "advantage" of capital is nothing but the yielding of revenue, then the denial that they are capital is merely a roundabout way of self-contradiction?

All this confused talk about capital, however, is lucidity itself compared with the exposition of the remarkable thesis, "Wages not drawn from capital, but produced by labour," which occupies the third chapter of "Progress and Poverty."

"If, for instance, I devote my labour to gathering birds' eggs or picking wild berries, the eggs or berries I thus get are my wages. Surely no one will contend that, in such a case, wages are drawn from capital. There is no capital in the case" (p. 34).

[177] Nevertheless, those who have followed what has been said in the first part of this essay surely neither will, nor can, have any hesitation about substantially adopting the challenged contention, though they may possibly have qualms as to the propriety of the use of the term "wages."8 They will have no difficulty in apprehending the fact that birds' eggs and berries are stores of foodstuffs, or vital capital; that the man who devotes his labour to getting them does so at the expense of his personal vital capital; and that, if the eggs and the berries are "wages" for his work, they are so because they enable him to restore to his organism the vital capital which he has consumed in doing the work of collection. So that there is really a great deal of "capital in the case."

Our author proceeds:–

"An absolutely naked man, thrown on an island where no human being has before trod, may gather birds' eggs or pick berries" (p. 34).

No doubt. But those who have followed my argument thus far will be aware that a man's vital capital does not reside in his clothes; and, therefore, they will probably fail, as completely as I do, to discover the relevancy of the statement.

[178] Again:–

"Or, if I take a piece of leather and work it up into a pair of shoes, the shoes are my wages–the reward of my exertion. Surely they are not drawn from capital–either my capital or anybody else's capital–but are brought into existence by the labour of which they became the wages; and, in obtaining this pair of shoes as the wages of my labour, capital is not even momentarily lessened one iota. For if we call in the idea of capital, my capital at the beginning consists of the piece of leather, the thread, &c." (p. 34).

It takes away one's breath to have such a concatenation of fallacies administered in the space of half a paragraph. It does not seem to have occurred to our economical reformer to imagine whence his "capital at the beginning," the "leather, thread, &c." came. I venture to suppose that leather to have been originally cattle-skin; and since calves and oxen are not flayed alive, the existence of the leather implies the lessening of that form of capital by a very considerable iota. It is, therefore, as sure as anything can be that, in the long run, the shoes are drawn from that which is capital par excellence; to wit, cattle. It is further beyond doubt that the operation of tanning must involve loss of capital in the shape of bark, to say nothing of other losses; and that the use of the awls and knives of the shoemaker involves loss of capital in the shape of the store of iron; further, the shoemaker has been enabled to do his work not only by the vital capital expended during the time occupied in making the pair of [179] shoes, but by that expended from the time of his birth, up to the time that he earned wages that would keep him alive.

"Progress and Poverty" continues:–

"As my labour goes on, value is steadily added until, when my labour results in the finished shoes, I have my capital plus the difference in value between the material and the shoes. In obtaining this additional value–my wages–how is capital, at any time, drawn upon?" (p, 34).

In return we may inquire, how can any one propound such a question? Capital is drawn upon all the time. Not only when the shoes are commenced, but while they are being made, and until they are either used by the shoemaker himself or are purchased by somebody else; that is, exchanged for a portion of another man's capital. In fact (supposing that the shoemaker does not want shoes himself), it is the existence of vital capital in the possession of another person and the willingness of that person to part with more or less of it in exchange for the shoes–it is these two conditions, alone, which prevent the shoemaker from having consumed his capital unproductively, just as much as if he had spent his time in chopping up the leather into minute fragments.

Thus, the examination of the very case selected by the advocate of the doctrine that labour bestowed upon manufacture, without any intervention of capital, can produce wages, proves to be a [180] delusion of the first magnitude; even though it be supported by the dictum of Adam Smith which is quoted in its favour (p. 34)–

"The produce of labour constitutes the natural recompense or wages of labour. In that original state of things which precedes both the appropriation of land and the accumulation of stock, the whole produce of labour belongs to the labourer. He has neither landlord nor master to share with him" ("Wealth of Nations," ch. viii).

But the whole of this passage exhibits the influence of the French Physiocrats by whom Adam Smith was inspired, at their worst; that is to say, when they most completely forsook the ground of experience for a priori speculation. The confident reference to "that original state of things" is quite in the manner of the Essai sur l'Inégalité. Now, the state of men before the "appropriation of land" and the "accumulation of stock" must surely have been that of purely savage hunters. As, by the supposition, nobody would have possessed land, certainly no man could have had a landlord; and, if there was no accumulation of stock in a transferable form, as surely there could be no master, in the sense of hirer. But hirer and hire (that is, wages) are correlative terms, like mother and child. As "child" implies "mother," so does "hire" or "wages" imply a "hirer" or "wage-giver." Therefore, when a man in "the original state of things" gathered fruit or killed game for his own sustenance, the fruit or [181] the game could be called his "wages" only in a figurative sense; as one sees if the term "hire," which has a more limited connotation, is substituted for "wage." If not, it must be assumed that the savage hired himself to get his own dinner; whereby we are led to the tolerably absurd conclusion that, as in the "state of nature" he was his own employer, the "master" and the labourer, in that model age, appropriated the produce in equal shares! And if this should be not enough, it has already been seen that, in the hunting state, man is not even an accessory of production of vital capital; he merely consumes what nature produces.

According to the author of "Progress and Poverty" political economists have been deluded by a "fallacy which has entangled some of the most acute minds in a web of their own spinning."

"It is in the use of the term capital in two senses. In the primary proposition that capital is necessary to the exertion of productive labour, the term "capital" is understood as including all food, clothing, shelter, &c.; whereas in the deductions finally drawn from it, the term is used in its common and legitimate meaning of wealth devoted, not to the immediate gratification of desire, but to the procurement of more wealth–of wealth in the hands of employers as distinguished from labourers" (p. 40).

I am by no means concerned to defend the political economists who are thus charged with blundering; but I shall be surprised to learn that any have carried the art of self-entanglement to [182] the degree of perfection exhibited by this passage. Who has ever imagined that wealth which, in the hands of an employer, is capital, ceases to be capital if it is in the hands of a labourer? Suppose a workman to be paid thirty shillings on Saturday evening for six days' labour, that thirty shillings comes out of the employer's capital, and receives the name of "wages" simply because it is exchanged for labour. In the workman's pocket, as he goes home, it is a part of his capital, in exactly the same sense as, half an hour before, it was part of the employer's capital; he is a capitalist just as much as if he were a Rothschild. Suppose him to be a single man, whose cooking and household matters are attended to by the people of the house in which he has a room; then the rent which he pays them out of this capital is, in part, wages for their labour, and he is, so far, an employer. If he saves one shilling out of his thirty, he has, to that extent, added to his capital when the next Saturday comes round. And if he puts his saved shillings week by week into the Savings Bank, the difference between him and the most bloated of bankers is simply one of degree.

At page 42, we are confidently told that "labourers by receiving wages" cannot lessen "even temporarily" the "capital of the employer," while at page 44 it is admitted that in certain cases the capitalist "pays out capital in wages." One would think that the "paying out" of capital is hardly possible without at least a "temporary" diminution of the capital from which payment is made. But "Progress and Poverty" changes all that by a little verbal legerdemain:–

"For where wages are paid before the object of the labour is obtained, or is finished–as in agriculture, where ploughing and sowing must precede by several months the harvesting of the crop; as in the erection of buildings, the construction of ships, railroads, canals, &c.–it is clear that the owners of the capital paid in wages cannot expect an immediate return, but, as the phrase is, must "outlay it" or "lie out of it" for a time which sometimes amounts to many years. And hence, if first principles are not kept in mind, it is easy to jump to the conclusion that wages are advanced by capital" (p. 44).

Those who have paid attention to the argument of former parts of this paper may not be able to understand how, if sound "first principles are kept in mind," any other conclusion can be reached, whether by jumping, or by any other mode of logical progression. But the first principle which our author "keeps in mind" possesses just that amount of ambiguity which enables him to play hocus-pocus with it. It is this; that "the creation of value does not depend upon the finishing of the product" (p. 44).

There is no doubt that, under certain limitations, this proposition is correct. It is not true that "labour always adds to capital by its exertion before it takes from capital its wages" (p. 44), [184] but it is true that it may, and often does, produce that effect.

To take one of the examples given, the construction of a ship. The shaping of the timbers undoubtedly gives them a value (for a shipbuilder) which they did not possess before. When they are put together to constitute the framework of the ship, there is a still further addition of value (for a shipbuilder); and when the outside planking is added, there is another addition (for a shipbuilder). Suppose everything else about the hull is finished, except the one little item of caulking the seams, there is no doubt that it has still more value for a shipbuilder. But for whom else has it any value, except perhaps for a fire-wood merchant? What price will any one who wants a ship–that is to say, something that will carry a cargo from one port to another–give for the unfinished vessel which would take water in at every seam and go down in half an hour, if she were launched? Suppose the shipbuilder's capital to fail before the vessel is caulked, and that he cannot find another shipbuilder who cares to buy and finish it, what sort of proportion does the value created by the labour, for which he has paid out of his capital, stand to that of his advances? Surely no one will give him one-tenth of the capital disbursed in wages, perhaps not so much even as the prime cost of the raw materials. Therefore, though the assertion that "the creation [185] of value does not depend on the finishing of the product" may be strictly true under certain circumstances, it need not be and is not always true. And, if it is meant to imply or suggest that the creation of value in a manufactured article does not depend upon the finishing of that article, a more serious error could hardly be propounded.

Is there not a prodigious difference in the value of an uncaulked and in that of a finished ship; between the value of a house in which only the tiles of the roof are wanting and a finished house; between that of a clock which only lacks the escapement and a finished clock?

As ships, house, and clock, the unfinished articles have no value whatever–that is to say, no person who wanted to purchase one of these things, for immediate use, would give a farthing for either. The only value they can have, apart from that of the materials they contain, is that which they possess for some one who can finish them, or for some one who can make use of parts of them for the construction of other things. A man might buy an unfinished house for the sake of the bricks; or he might buy an incomplete clock to use the works for some other piece of machinery.

Thus, though every stage of the labour bestowed on raw material, for the purpose of giving rise to a certain product, confers some additional value on that material in the estimation of those who are [186] engaged in manufacturing that product, the ratio of that accumulated value, at any stage of the process, to the value of the finished product is extremely inconstant, and often small; while, to other persons, the value of the unfinished product may be nothing, or even a minus quantity. A house-timber merchant, for example, might consider that wood which had been worked into the ribs of a ship was spoiled–that is, had less value than it had as a log.

According to "Progress and Poverty," there was, really, no advance of capital while the great St. Gothard tunnel was cut. Suppose that, as the Swiss and the Italian halves of the tunnel approached to within half a kilometre, that half-kilometre had turned out to be composed of practically impenetrable rock–would anybody have given a centime for the unfinished tunnel? And if not, how comes it that "the creation of value does not depend on the finishing of the product"?

I think it may be not too much to say that, of all the political delusions which are current in this queer world, the very stupidest are those which assume that labour and capital are necessarily antagonistic; that all capital is produced by labour and therefore, by natural right, is the property of the labourer; that the possessor of capital is a robber who preys on the workman and appropriates to himself that which he has had no share in producing.

[187] On the contrary, capital and labour are, necessarily, close allies; capital is never a product of human labour alone; it exists apart from human labour; it is the necessary antecedent of labour; and it furnishes the materials on which labour is employed. The only indispensable form of capital–vital capital–cannot be produced by human labour. All that man can do is to favour its formation by the real producers. There is no intrinsic relation between the amount of labour bestowed on an article and its value in exchange. The claim of labour to the total result of operations which are rendered possible only by capital is simply an a priori iniquity.

1 It remains to be seen whether the plants which have no chlorophyll, and flourish in darkness, such as the Fungi, can live upon purely mineral food.

2 In some remarkable passages of the Botany of Sir James Ross's Antarctic voyage, which took place half a century ago, Sir Joseph Hooker demonstrated the dependence of the animal life of the sea upon the minute, indeed microscopic, plants which float in it: a marvellous example of what may be done by water-culture. One might indulge in dreams of cultivating and improving diatoms, until the domesticated bore the same relation to the wild forms, as cauliflowers to the primitive Brassica oleracea, without passing beyond the limits of fair scientific speculation.

3 It is a pity that we have no word that signifies plant-culture exclusively. But for the present purpose I may restrict agriculture to that sense.

4 I do not forget electric lighting, greenhouses and hothouses, and the various modes of affording shelter against violent winds: but in regard to production of food-stuffs on the large scale they may be neglected. Even if synthetic chemistry should effect the construction of proteids, the Laboratory will hardly enter into competition with the Farm within any time which the present generation need trouble itself about.

5 See the discussion of this subject further on.

6 Collected Essays, vol. i. pp. 359-382.

7 The italics are the author's.

8 Not merely on the grounds stated below, but on the strength of Mr. George's own definition. Does the gatherer of eggs, or berries, produce them by his labour? If so, what do the hens and the bushes do?

Preface and Table of Contents to Volume IX, Evolution & Ethics and Other Essays, of Huxley's Collected Essays.

Next article: Social Diseases and Worse Remedies [1891], beginning page 188.

Previous article: Science and Morals [1886], pages 117-146.



1.   THH Publications
2.   Victorian Commentary
3.   20th Century Commentary

1.   Letter Index
2.   Illustration Index

Gratitude and Permissions

C. Blinderman & D. Joyce
Clark University

§ 1. THH: His Mark
§ 2. Voyage of the Rattlesnake
§ 3. A Sort of Firm
§ 4. Darwin's Bulldog
§ 5. Hidden Bond: Evolution
§ 6. Frankensteinosaurus
§ 7. Bobbing Angels: Human Evolution
§ 8. Matter of Life: Protoplasm
§ 9. Medusa
§ 10. Liberal Education
§ 11. Scientific Education
§ 12. Unity in Diversity
§ 13. Agnosticism
§ 14. New Reformation
§ 15. Verbal Delusions: The Bible
§ 16. Miltonic Hypothesis: Genesis
§ 17. Extremely Wonderful Events: Resurrection and Demons
§ 18. Emancipation: Gender and Race
§ 19. Aryans et al.: Ethnology
§ 20. The Good of Mankind
§ 21.  Jungle Versus Garden