Problems of Poverty

The object of this volume is to collect, arrange, and examine some of the leading facts and forces in modern industrial life which have a direct bearing upon Poverty, and to set in the light they afford some of the suggested palliatives and remedies. Although much remains to be done in order to establish on a scientific basis the study of "the condition of the people," it is possible that the brief setting forth of carefully ascertained facts and figures in this little book may be of some service in furnishing a stimulus to the fuller systematic study of the important social questions with which it deals.

The treatment is designed to be adapted to the focus of the citizen-student who brings to his task not merely the intellectual interest of the collector of knowledge, but the moral interest which belongs to one who is a part of all he sees, and a sharer in the social responsibility for the present and the future of industrial society.

For the statements of fact contained in these chapters I am largely indebted to the valuable studies presented in the first volume of Mr. Charles Booth's Labour and Life of the People, a work which, when completed, will place the study of problems of poverty upon a solid scientific basis which has hitherto been wanting. A large portion of this book is engaged in relating the facts drawn from this and other sources to the leading industrial forces of the age.

In dealing with suggested remedies for poverty, I have selected certain representative schemes which claim to possess a present practical importance, and endeavoured to set forth briefly some of the economic considerations which bear upon their competency to achieve their aim. In doing this my object has been not to pronounce judgment, but rather to direct enquiry. Certain larger proposals of Land Nationalization and State Socialism, etc., I have left untouched, partly because it was impossible to deal, however briefly, even with the main issues involved in these questions, and partly because it seemed better to confine our enquiry to measures claiming a direct and present applicability.

In setting forth such facts as may give some measurement of the evils of Poverty, no attempt is made to suppress the statement of extreme cases which rest on sufficient evidence, for the nature of industrial poverty and the forces at work are often most clearly discerned and most rightly measured by instances which mark the severest pressure. So likewise there is no endeavour to exclude such human emotions as are "just, measured, and continuous," from the treatment of a subject where true feeling is constantly required for a proper realization of the facts.

In conclusion, I wish to offer my sincere thanks to Mr. Llewellyn Smith, Mr. William Clarke, and other friends who have been kind enough to render me valuable assistance in collecting the material and revising the proof-sheets of portions of this book.

§ 1.The National Income, and the Share of the Wage-earners.--To give a clear meaning and a measure of poverty is the first requisite. Who are the poor? The "poor law," on the one hand, assigns a meaning too narrow for our purpose, confining the application of the name to "the destitute," who alone are recognized as fit subjects of legal relief. The common speech of the comfortable classes, on the other hand, not infrequently includes the whole of the wage-earning class under the title of "the poor." As it is our purpose to deal with the pressure of poverty as a painful social disease, it is evident that the latter meaning is unduly wide. The "poor," whose condition is forcing "the social problem" upon the reluctant minds of the "educated" classes, include only the lower strata of the vast wage-earning class.

But since dependence upon wages for the support of life will be found closely related to the question of poverty, it is convenient to throw some preliminary light on the measure of poverty, by figures bearing on the general industrial condition of the wage-earning class. To measure poverty we must first measure wealth. What is the national income, and how is it divided? will naturally arise as the first questions. Now although the data for accurate measurement of the national income are somewhat slender, there is no very wide discrepancy in the results reached by the most skilful statisticians. For practical purposes we may regard the sum of £1,800,000,000 as fairly representing the national income. But when we put the further question, "How is this income divided among the various classes of the community?" we have to face wider discrepancies of judgment. The difficulties which beset a fair calculation of interest and profits, have introduced unconsciously a partisan element into the discussion. Certain authorities, evidently swayed by a desire to make the best of the present condition of the working-classes, have reached a low estimate of interest and profits, and a high estimate of wages; while others, actuated by a desire to emphasize the power of the capitalist classes, have minimized the share which goes as wages. At the outset of our inquiry, it might seem well to avoid such debatable ground. But the importance of the subject will not permit it to be thus shirked. The following calculation presents what is, in fact, a compromise of various views, and can only claim to be a rough approximation to the truth.

Taking the four ordinary divisions: Rent, as payment for the use of land, for agriculture, housing, mines, etc.; Interest for the use of business capital; Profit as wages of management and superintendence; and Wages, the weekly earnings of the working-classes, we find that the national income can be thus fairly apportioned--

Rent: £200,000,000.

Interest: £450,000,000.

Profits: £450,000,000.

Wages: £650,000,000.

Total: £1750,000,000.

Professor Leone Levi reckoned the number of working-class families as 5,600,000, and their total income £470,000,000 in the year 1884. If we now divide the larger money, minus £650,000,000, among a number of families proportionate to the increase of the population, viz. 6,900,000, we shall find that the average yearly income of a working-class family comes to about £94, or a weekly earnings of about 36s. This figure is of necessity a speculative one, and is probably in excess of the actual average income of a working family.

This, then, we may regard as the first halting-place in our inquiry. But in looking at the average money income of a wage-earning family, there are several further considerations which vitally affect the measurement of the pressure of poverty.

First, there is the fact, that out of an estimated population of some 42,000,000, only 12,000,000, or about three out of every ten persons in the richest country of Europe, belong to a class which is able to live in decent comfort, free from the pressing cares of a close economy. The other seven are of necessity confined to a standard of life little, if at all, above the line of bare necessaries.

§ 1.Centralizing-Influence of Machinery.--In seeking to understand the nature and causes of the poverty of the lower working-classes, it is impossible to avoid some discussion of the influence of machinery. For the rapid and continuous growth of machinery is at once the outward visible sign and the material agent of the great revolution which has changed the whole face of the industrial world during the last century. With the detailed history of this vast change we are not concerned, but only with its effects on the industrial condition of the poor in the present day.

Those who have studied in books of history the industrial and educational condition of the mass of the working populace at the beginning of this century, or have read such novels as Shirley, Mary Barton, and Alton Locke, will not be surprised at the mingled mistrust and hatred with which the working-classes regarded each new introduction of machinery into the manufacturing arts. These people, having only a short life to live, naturally took a short-sighted view of the case; having a specialized form of skill as their only means of getting bread, they did not greet with joy the triumphs of inventive skill which robbed this skill of its market value. Even the more educated champions of the interests of working-classes have often viewed with grave suspicion the rapid substitution of machinery for hand-labour in the industrial arts. The enormous increase of wealth-producing power given by the new machinery can scarcely be realized. It is reckoned that fifty men with modern machinery could do all the cotton-spinning of the whole of Lancashire a century ago. Mr. Leone Levi has calculated that to make by hand all the yarn spun in England in one year by the use of the self-acting mule, would take 100,000,000 men. The instruments which work this wonderful change are called "labour-saving" machinery. From this title it may be deemed that their first object, or at any rate their chief effect, would be to lighten labour. It seems at first sight therefore strange to find so reasonable a writer as John Stuart Mill declaring, "It is questionable if all the mechanical inventions yet made have lightened the day's toil of any human being." Yet if we confine our attention to the direct effects of machinery, we shall acknowledge that Mill's doubt is, upon the whole, a well founded one.

According to the evidence of existing poverty adduced in the last chapter, it would appear that the lowest classes of workers have not shared to any considerable degree the enormous gain of wealth-producing power bestowed by machinery. It is not our object here to discuss the right of the poorer workers to profit by inventions due to others, but merely to indicate the effects which the growth of machinery actually produce in this economic condition. Let us examine the industrial effects of the growth of machinery, so as to understand how they affect the social and economic welfare of the working-classes.

§ 2. Class Separation of Employer and Workmen.--The first effect of machinery is to give a new and powerful impulse to the centralizing tendency in industry. "Civilization is economy of power, and English power is coal," said the materialistic Baron Liebig. Coal as a generator of steam-power demands that manufactures shall be conducted on a large scale in particular localities. Before the day of large, expensive steam-driven machinery, manufacture was done in scattered houses by workers who were the owners of their simple tools, and often of the material on which they worked; or in small workshops, where a master worked with a few journeymen and apprentices. Machinery changed all this. It drove the workers into large factories, and obliged them to live in concentrated masses near their work. They no longer owned the material in which their labour was stored, or the tools with which they worked; they had to use the material belonging to their employer; the machinery which made their tools valueless was also the property of the capitalist employer. Instead of selling the products of their capital and labour to merchants or consumers, they were compelled to sell their labour-power to the employer as the only means of earning a livelihood. Again, the social relations between the wealthy employer and his "hands" were quite different from those intimate personal relations which had subsisted between the small master and his assistants. The very size of the factory made such a social change inevitable, the personal relation which marked medieval industry was no longer possible. Machinery then did two things. On the one hand, it destroyed the position of the workman as a self-sufficing industrial unit, and made him dependent on a capitalist for employment and the means of supporting life. On the other hand, it weakened the sense of responsibility in the employer towards his workmen in proportion as the dependence of the latter became more absolute.