Popular Science Monthly/Volume 36/March 1890/The Gross and Net Gain of Rising Wages

Popular Science Monthly Volume 36 March 1890  (1890) 
The Gross and Net Gain of Rising Wages by Robert Giffen



IN the discussions to which former papers of mine on working-class progress have given rise, there are some criticisms which have interested me very much. They are made by members of the working class themselves, who are slow enough to admit the average increase of their money earnings in the last fifty years which the figures demonstrate. But, admitting some increase of money, they go on to say, and admitting, too, the low prices, the improvement after all is not without drawbacks, or, as I have suggested in the above title, it is mainly in the gross. There are drawbacks which take away much of the apparent advantage. A general statement like this, apart from particular allegations to support it, could not but excite my attention, although I have avoided hitherto any discussion of it. It is a good rule to do one thing at a time. An improvement of money earnings and no increase of prices appeared to be two points worth establishing, whatever the drawbacks of a less apparent kind, and which the working classes could themselves best appreciate, might be. But while avoiding the discussion hitherto, I have been none the less observant, for the simple reason that each class knows its own grievances as no others can, and that such complaints, though easy enough to prove unfounded, are apt to cover facts which will reward investigation—which will throw light, when properly understood, not only on the particular problems in hand, but on larger problems. I propose in the present paper to communicate some reflections which I have made. The alleged drawbacks, when considered, do, in fact, suggest for consideration questions of a weighty nature, which go to the root of ideas of progress, and affect the most general views of the prospects of modern civilization.

The alleged drawbacks of which I speak are mainly the following: First, it is said, workingmen in many cases have more to pay for rent than they would have to pay when earning less money under different conditions, or they have to pay railway or 'bus fares or similar charges for conveyance to and from their work, which are in the nature of an increase of rent. Consequently, although the money wage is more, the workman is not so much better off than he was, because a large part of that money wage has to be paid as a fine, practically, to enable the workingman to be in a position to earn it. In other words, the gross sum is more, but the net sum is not so much more. It is easy to perceive, also, that this principle may have a much wider application than may at first be surmised. The case usually thought of is that of rent, or an equivalent fine on a workman, which he pays in order to be in a certain place where the money wage can be earned. Suppose the climate in which he has to live in order to earn a larger money wage than he can get elsewhere is so exhausting as to compel a larger consumption of food in order that the money may be earned? The question of gross and net is thus of a wide-sweeping kind.

Next, it is maintained that along with a great increase in production, which has undoubtedly taken place, there has come an increase in the severity of the labor, and that the workman's remuneration has not risen in proportion. It seems to be suggested at times that the increase in the labor is itself an evil, even if it were proportionately remunerated, but the complaint rather is that the severer toil is not adequately compensated; the workman has a severer call made on his energies, and he is not so much better off. To be able to earn more money, it is sometimes urged, he must, in fact, spend more money on food and other things than he formerly did. Here, again, is a question of gross and net, and it will be observed how the last complaint raises in a different form the question already suggested under the first head by a consideration of the effects of climate. A distinction is made between the gross earning and the net surplus, the difference being something which the workingman has to pay as a fine to enable him to earn the net sum which he wishes to spend.

Last of all, it is maintained that on all sides the scale of living has become more expensive. The workingman has to get more food, clothing, and shelter for his family than he would formerly have had to get; more is expected of him; and he has to pay for such things as the education of his children to a much greater extent than he would formerly have had to pay. In this way the strain upon the workingman has increased. As I understand the complaint, he is no more a free man than before. His energies are mortgaged in advance, and he has all the old difficulty to keep his footing in the world.

Now, whether these complaints are right or wrong, well or ill founded, it is clear that they involve problems of a most vital kind as to the general effect upon the working classes of the conditions of modern civilization. To take the first head of complaint. If it be the case that a rise of rent or the charge for traveling between the place of living and the place of work or similar expenditure is sufficient to deprive workingmen of the advantage of increased money wages, then the congregation of men in cities or in certain parts of cities, where higher money wages are to be obtained than elsewhere, which appear to be the conditions of modern industrial life, would be fatal to improvement. It would be the same with the necessity for working in an exhausting climate. The problem, as stated, is certainly of the gravest kind. The questions raised by the second head of complaint are just as important. If increase of toil, not proportionately remunerated—for which perhaps there can be no proportionate remuneration—comes with the increase of productive capacity and the greater call thus made on the nervous and mental energy of the workman, what is the workingman the better off for all the civilization? Finally, as regards the increased cost of living through a rise in the scale, may it not be the case that such a rise in the scale of living is to some extent what is meant by progress, though the drawback of the slavery of the workers, which some workingmen appear to feel so keenly, remains.? How far is the "slavery" itself avoidable, so long as human nature is what it is, unless at the risk of all civilization perishing? Such problems are obviously of the deepest interest. The desire for leisure, for an ease to a severe strain, in all these complaints, is itself very striking, and may perhaps be held of itself to indicate a change of working-class conditions, as compared with a time when the masses simply endured, or were content to drag on a dull existence, with little color in it, and without hope of change. The whole subject, at any rate, should be well worth considering. What are the facts, and what should be the conclusions regarding them?

Dealing with the first head of complaint, which is perhaps the simplest and most easily dealt with, we must allow it to be obvious on the surface that there is a real point for discussion. Under the essential conditions of modern life, principally the concentration of huge masses on narrow room, competition among laborers undoubtedly produces monopoly rent, the payment of which is a simple deduction from the gross money wages which workmen receive. If workmen, to avoid paying more than they can help, live at a distance from their work, they only escape the evil partially, because charges for conveyance to and from their work have to be paid. Clearly workmen under such conditions, as compared with conditions under which no monopoly rent or its equivalent has to be paid, are at a disadvantage. To show their real position for the purpose of comparison, the monopoly portion of the rent must be deducted. It is quite obvious, also, on the merest superficial aspect of the question, that as regards many workmen, at least, the disadvantage may easily be so serious as to compensate, and more than compensate, all the difference between the money wage of the country, where there is no monopoly rent, and the money wage of the town. Take the case of a west Highland peasant fifty years ago, living on a scanty wage of a few shillings a week, or the produce of a poor croft eked out by kelp-gathering or fishing, and his descendant at the present time in the slums of a great city, earning perhaps fifteen shillings a week, but disbursing four or five shillings for rent. The improvement in money earnings may be immense, perhaps one hundred per cent, and as regards prices of commodities there may be no drawback in the change, but the rent takes a monstrous cantle out of the margin. Comparing all the conditions, it may certainly be doubted whether the peasant, in the case supposed, in exchanging the hard life of the country, which still had the advantage of being in the open, for the hard life of the city, has made any real advance. Take a case higher in the scale. A doctor, to earn a living, resides in a city rather than in the country, pays a huge monopoly rent to begin with, and incurs many other analogous expenses, so that altogether he has a large leeway to make up before he can reckon that net income which can properly enter into comparison with that of his country colleague. The difference may easily be so great, I believe, that in many cases a professional man in a small country town with three or four hundred pounds a year may have a larger net income for the real objects of life, dealing with the question in a wise, philosophic spirit, than a professional man in London with a thousand or twelve hundred pounds a year. There are differences even between London and smaller provincial cities. Thus the question between gross and net, which workingmen have raised in these discussions, apropos of monopoly rent or the equivalent, is a real question. It is a new form of the old theorem that people may buy gold too dear.

I have already, in part, dealt with the question practically as far as workingmen are concerned, by pointing out the really narrow limits of monopoly rent,[1]. and practically the final conclusion must be reached by the statistical method, and in the way I have already used. But I wish to avoid statistics for the present, and to indicate merely the general conditions of the problem to be solved, which appear to minimize the possible extent of the alleged drawback.

It is clear, first of all, on general grounds, that the concentration of men in cities is due to the fact that cities, on the whole, weigh in the balance against the country. There is more and better employment there than in the country, all deductions made, in the opinion of those interested; and that seems a conclusive answer to the question as to whether, on the whole, there is not a net as well as a gross improvement in wages as far as this drawback is concerned.

Next, it is plain that, as a great part of the improvement of the last fifty years has consisted in the substitution of artisan and other highly paid labor for merely rude labor, the additional monopoly rent payable in the cities can only be, in most cases, a comparatively trifling drawback. It may be the case that, if we compare the former peasant of the country with the rude laborer of the city, and especially of the metropolis, the latter has hardly gained; but if we compare the former peasant of the country with the town artisan of the present time, although the latter has to pay monopoly rent or an equivalent charge for conveyance, there is still an enormous gain in the latter's position. It is the same with the professional classes. If the latter were stationary in number, or increasing only pari passu with the increase of population, then the larger gross income on the average earned by the masses of professional men in cities, as compared with the professional incomes earned in the country formerly, might show little net improvement; but allowance has to be made for the fact that the number of such incomes has enormously increased, and that the earners largely compare with the earners of wholly inferior incomes in former times, whether in town or country. As the increase of these classes could not have taken place without the growth of cities, there must be a large net as well as gross gain to be reckoned when the comparison is properly made.

To bring the matter to a point, what I have to urge is, that the very growth of cities implies the existence of conditions under which workmen of higher grades take the place of workmen of lower grades, so that, although class for class a workman passing from country to town does not seem to gain so very much, on account of the difference between gross and net, yet, man for man, on the average there is an enormous gain. Illusion is produced because the proper terms of the comparison are lost sight of. The point is especially important as regards what is known as the residuum. Nothing can appear so deplorable or so hopeless as the conditions of the floating mass of rude labor in large cities. Monopoly rents in this case appear to sweep away all possible advantage which may result from higher money wage, comparing the laborer of the town with the laborer of the country. In many cases, even, it must be admitted, the "residuary" of the city is on a lower level than the "residuary" of the country. His "net" earnings are less. But the question, after all, is one of proportion. The absolute magnitude of the city residuum must not blind us to the fact that it may be, not an increasing but a diminishing element with reference to the population generally. I believe it is a diminishing element, but this would hardly be the place to discuss the point, and I am content for the present to call attention to its importance in the discussion. The assumption, so often made, that the residuum is increasing relatively, is one which requires proof, and I have never seen any attempt at proof, while there are some broad facts, such as the diminution of serious crime and of pauperism, against it.

The question of the way in which the net value of an increase of money wages may be affected by the necessity of living in a more exhausting, or in some way more expensive, climate, or by the specially exhausting character of a highly paid occupation, such as puddling, is one of the same kind. There is clearly a point in the matter for consideration and discussion. I am disposed to believe, for instance, that the exhausting climate of the United States, compelling the consumption of more food to enable the same work to be done, is a distinct drawback to the American workingman as compared with his competitor in western Europe, and especially in Great Britain. I am not sure but that living in the south of England, owing to climate, is more expensive than in the north and in Scotland. The point has hardly been expressly considered, the workingman practically having been right to go where he gets the highest money wage, but it is one that may become of increasing practical interest now that charges for conveyance are so low throughout the world as to make it quite unnecessary for men to live near the places where their food and raw materials are produced. I shall be well content for the present if the remarks here made induce some workingmen to elaborate it from their practical experiences. Of course, in any discussion it would also have to be considered that the greater expense of living may not be a pure drawback. The ability to consume and produce more, to bear exhausting climate or occupation, in fact, may be a good thing, and bring its own compensation, although the net gain, taking matters strictly, may hardly be appreciable.

The next head of complaint is the increase in the severity of labor and the want of any proportionate remuneration.

On this head it may be admitted, to begin with, that there is apparent foundation for some of the complaints. Workmen in particular employments do not get a reward at all in proportion to the increase of production in those employments. The illustration of a cotton-mill is familiar. A single attendant on a number of machines will "produce" as much in an hour as formerly in a year or two, but his wages are only double—or perhaps not quite double—what they were when the production was so much less. A great steamship supplies another illustration. The ship does many times the work which could have been performed by the sailing ship it has displaced, and with much fewer men in proportion to the tonnage conveyed. But the wages of the average member of the crew are again only double, or not quite double, what they were when the conveyance done was so much less. In these and similar cases, who gets the benefit of all the increase of production? The workmen in the particular employments concerned, receiving only a fraction of the gain, may be excused for suspecting that there is something inexplicable in those social and economic arrangements by which the benefit is spirited away from them.

But, however natural the question, it is not difficult to point out that there is a good reason why workmen in some given employments should only receive a fraction of the benefit from the increased productiveness of those employments, and that this fact is quite consistent with an improvement in the position of workmen all round in proportion to the generally increased productiveness of labor, which is the real question we are now investigating, for the purpose of comparing this increase of productiveness with the increase of the severity of labor throughout society. The short explanation is that the employments in which there is a great increase of production, being mainly the employments in which there are great mechanical improvements from time to time, constitute only a part of the whole employment for labor, and that by a natural law labor in each employment finds its level, the increase of the return arising from an invention in a particular employment resulting in a gain, not to the particular laborers concerned, but to the whole community of laborers. That the gain may be general, it is, in fact, essential that laborers generally should gain as consumers rather than as producers, which implies that in a given employment wages should increase, not in proportion to the increased productiveness of that employment by itself, but in proportion to the increased productiveness of labor generally. Hence, it may well be that while the productive power of machines may enormously increase, yet the general increase of productive power may be much less than would at first be thought, owing to the comparatively small proportion of laborers, after all, who use machinery of great capacity largely in their employments. Looking at the number of domestic servants, of clerks, of professional men and women, of unskilled laborers of every kind, of skilled laborers, such as painters, who do not use machines, I should doubt very much whether one fourth of the laborers, even in a society like that of England, the most manufacturing in the world, use machinery of great capacity in their employments. It is easily to be accounted for, therefore, why in a given employment there should be a great increase of production without a corresponding increase of remuneration to those engaged in that particular employment. The gain has to be diffused through society, and the increase of production generally is not so great, and not nearly so great, as in a few special cases.

Another observation must be made. There may be a considerable improvement in the quality of production in employments of a non-mechanical kind, which it is difficult or even impossible to note by quantities, but where the labor competes with all other labor for remuneration. Where the increased remuneration should go to, when machines improve, is not thus so easy to determine a priori.

It is also obvious that even in an advancing community the remuneration of certain kinds of laborers, whose numbers continue disproportionate, may either not increase at all, or increase very little, the whole gain from increased productiveness being for the benefit of the laborers whose own labor improves in quality, apart from the fact that it is employed on more productive machines. Strictly speaking, unless there is a rise in the scale of living, accompanied by an improvement in quality all round, there is no reason why, in modern times, a man who can only drive a spade into the ground, or wheel a barrow, or carry bricks up a ladder, should receive any higher reward than similar laborers in former ages. The fact that such laborers are little better off is not inconsistent with the fact that workmen generally receive a larger reward than in any former period.

The way is thus cleared for answering the question as to whether the remuneration of labor has increased generally in proportion to the increased severity of labor.

It can not be denied, first of all, that there is a great increase of the productiveness of labor itself, as well as a great increase of the absolute amount of remuneration. This is admitted on all sides. The increase of production is the very fact which is assumed. Nor is the increase of remuneration denied—the only question is of the proportionate remuneration. Before passing from this point, however, I should like to dwell a little on the fact already referred to, of an improvement in the quality of nonmechanical labor, because, as this labor is largely the subject of direct exchange without much intervention of capital, the mere fact of improvement implies almost a proportionate increase of remuneration. At any rate, the laborers concerned get almost the whole benefit, because they exchange with each other. I refer to such employments as those of teaching, medical attendance, nursing, domestic service, dressmaking, and the like among the upper and middle classes. The increase of remuneration here may not be in proportion to the improvement of quality; the game may not be worth the candle; but, at any rate, the exchanges are direct. Now, as to the fact of great improvement, I believe there is no doubt. Nursing, for instance, is said to be an entirely different thing in hospitals from what it was only fifteen or twenty years ago. Domestic service, as regards cooking, waiting, and other points, is also, on the whole, better, notwithstanding manifold complaints, just because of the general improvement in education and intelligence. The same with dressmaking. More intelligence and skill are everywhere applied, and in direct exchanges, without much intervention of machines or of capital.

Next, it has to be considered, as regards the question of proportionate remuneration, that by the very mode of here stating the question, it appears that it is not so much a question of increase in the severity of labor generally, as of a change in the character of the labor. If the quality of labor has altered and improved in many directions, there is, in truth, no proper term for comparison between the present and former times. The improvement of the quality of the labor, which is another name for the increased intelligence and energy of society, may not be proportionately remunerated; but there is no means of telling. People would not go back to the conditions of a former society, where less intelligence and energy were required for a lower scale of living, even if they had the choice. The new advantages, with all their drawbacks, are accepted as part of a higher state. The complaints are to some extent a sign of the perpetual unrest of human life, and of the fact of improvement itself.

There can equally be no doubt, looking at the matter in this way, that in certain directions there may be a very poignant and not unjustifiable feeling as to an increase in the severity of labor. This appears to be the case as regards employments which involve the watching of machines, the very employments where there is apparently the greatest increase of production and the least proportionate increase of the remuneration of labor. The strain upon the nervous system, through the combined monotony of the employment and the constant vigilance required, are no doubt very often most severe, and are perhaps felt the more because the present generation is comparatively untrained. But the increased severity of toil, without proportionate remuneration, might be admitted in those special employments without altering the fact that remuneration has increased generally. What seems to have happened in these cases is, that the development of society imposes a heavy burden on a special class, involving rapid change in the quality of its labor, to which it is hardly equal, but that the improvement in quality is part of the general improvement in society. The nervous power to stand monotony and supply the necessary vigilance and other moral qualities necessary for the supervision of machines may exist in greater abundance in the next generation, along with a continued improvement in the quality of labor in non-mechanical employments.

It will, perhaps, be urged that the workman does not get a proportionate remuneration because the capitalist obtains for himself the increased product—the socialist argument. But the facts are all against this explanation. One of the most remarkable facts of recent years is the general decline in the return to capital. Capitalists from year to year have been willing to invest for a smaller and smaller return. We must assume, then, that if they have gained at all it has only been by the immense cheapening of commodities, and labor has gained more than in proportion. This would appear to be the case: only the laborers who have gained, as we have seen, are. not specially those who are occupied about machines. The gain is generally diffused, and is received by laborers generally in proportion to the relative values of their work. Apparently the greatest gain has been among the higher artisan and lower professional classes—the very classes, it may be remarked, by whom the strain of modern life is felt the most intensely.

The conclusion, then, is, that if the return to labor generally is not proportionate to the increase of the severity of toil itself, the reason must be that people are working for inadequate objects. The game, in one sense, may not be worth the candle. The problem is another form of the very same problem that has been considered with reference to the payment of monopoly rents. On the whole, notwithstanding all the drawbacks of city life, there is some improvement which makes the payment of monopoly rents worth while. People would not change back to the former conditions. So, on the whole, notwithstanding all the drawbacks of really severer toil, and the inadequacy of the additional remuneration, people would not change back. What has happened is really a revolution in the quality of labor and the general conditions of life. The net gain, in one view, is less than the apparent gross improvement, looking at the matter strictly; in another view, the gain is so great as to make the present condition of workmen on the average incommensurable with their former condition. The two things are not on the same plane, and can hardly be compared.

An important corollary seems to be suggested by these considerations. If there is so much doubt about the adequacy of the reward for the additional labor thrown on workmen by the conditions of modern society, is not that reward really a minimum reward? In other words, may not the amount of production itself be conditioned by the energy of the workman, which is in turn a function of the food and other things on which he expends his wages, so that the quality of labor by which modern society is carried on would not itself exist if the remuneration were less than it is? The complaint we are dealing with is that of the severity of modern toil, and implies that the workman is tasked to his full capacity, and can just do the work, so that the remuneration can not be reduced. And that this is really the case in many employments may be easily enough illustrated. It is quite certain that the driver of an express engine could not go through the very formidable labors he undergoes if he only had the food of the rude laborer of a former time, and only lived in the way that such a laborer used to live. He would not, under such conditions, have the energy or brain-power for the work to be done. It is the same with workmen in a factory who have to attend to many machines. The constant strain simply could not be endured if the workman had to live as the factory worker of a former time had to live. The present worker is really cheaper than the former worker, because he does more in proportion; but, dear as he is, yet, in another respect, he may perhaps be viewed, according to a suggestion already made, as really engaged at a minimum wage—without which he could not do the work at all. This is not a question merely of a rise in the scale of living, though that question is intermixed with it. It is a question of the actual necessity on the part of the workman that certain things should be put into him, or supplied to him, as a condition of his doing the work which he actually performs. What is true of the workman specially referred to is of course still more true of the higher kinds of work involving artistic or other skill.

It may also be added that the suggestion already made as to the reason for a non-increase of remuneration in certain directions being that the work done has not itself improved in quality, is fully confirmed by the general view thus stated. If the work which has improved in quality is itself only so remunerated as to make it doubtful whether the remuneration is adequate, whether the game is worth the candle, and is, in fact, at the point of minimum, so as to enable the work to be done at all, out of what fund is the remuneration of the work that has not improved in quality to come? In the midst of plenty, apparently, such workmen, by comparison, must starve, because, notwithstanding all the plenty, those who really do the hard work of modern society are only just paid, and no more. It is easy for such workmen and their so-called friends to point to the capitalists as living on their labor; and no doubt, if it were possible to divide the earnings of capitalists among society generally, according to numbers, these particular workmen might be much better off. But it is not from the labor of such workmen that capitalists mainly derive their income, while those who do work, as we have seen, have so large a remuneration that they can have no quarrel with the capitalist. The suggested division would therefore only be for the benefit of a special class whose existence is itself a danger to society, and which should rather be discouraged than encouraged, the whole efforts of society being rather directed to their transformation by education and similar agencies into a higher class, than to securing an increased payment for their work under present conditions. The curse of the very poor, in more senses than one, is their poverty—poverty in strength, in mental capacity, in moral qualities. They are poor because they can not earn more. If they were stronger they would have the earnings, and would have no quarrel with the capitalists. To improve their condition they must be made stronger, and not merely given more to spend, which would be a curse to them instead of a blessing, as it is to the merely idle capitalist whose luxury they envy, whose existence is a danger to society also, and whose obliteration, or rather transformation into a different class, is equally to be sought for.

The next head of complaint is that a workman has more expenses now, in consequence of the rise in the scale of living. Not only himself, but his family, must live better. They must have better and more food, be better clothed and sheltered, be better educated, and so on. The workman himself, on whom the burden falls, has no more surplus than before. He is not a freer man.

This head of complaint, however, demands very little remark. The statement of the complaint is, in truth, one of the best evidences of progress. Of course, there has been a rise in the scale of living. Such a rise was quite certain to come with an improvement in the earnings of workmen. The fact that it has come is itself one of the proofs of improvement. No doubt there is a continued absence of a free surplus. I suspect, however, that at no time have many people, in this country at least, had philosophy enough to be thrifty and careful, and to do without some things that appear to be necessary for their sphere in life, so as to have what is meant by a surplus. Its absence is certainly no proof that the condition of those who make the complaint has not improved. The scale of living has risen, and this rise, beyond all question, imposes a strain upon many workmen which only the greatest care and philosophy can mitigate. It involves of necessity severer toil on the part of the bread-winner, with no apparent surplus for himself.

It is apparent, however, that to some extent what is called a rise in the scale of living is, in reality, an improvement in the mode of living which is absolutely necessitated by the work itself, without which, in fact, the work could not be done. Where moral qualities are to be displayed, and great vigor, punctuality, and energy are required, they are not to be expected except from workmen of a certain class, whose scale of living has, in fact, risen to the standard necessary, and whose "medium" and "atmosphere," of which the condition of wife and children or relations is a part, are altogether different from what they were. Before human beings can display the qualities and exert the energies required, they must have certain tastes and wants to gratify, or there would be no motive to exhibit those qualities and energies. Hence a rise in the scale of living is only another mode of describing the improvement in the character of the workman, which is essential to the performance of the work to be done.

The conclusions of this long argument may now be very shortly restated. In certain cases the increase of net earnings by the advance of the last fifty years can not be so great as the increase of gross earnings, because some classes of workmen have to submit to an increased charge for rent and railway fares, and similar expenditure, which really amount to a reduction from the gross earnings which they receive. But, on the whole, the classes of workmen affected in this way must, from the nature of things, be comparatively small, while the general conditions are such that the deduction from gross earnings, as a rule, still leaves an enormous net gain. Next, the allegation as to the increased severity of labor, and as to workmen not getting a sufficiently adequate remuneration or a sufficient share of the increased gross produce, is met by the admission generally of an increase in the severity of labor, which, however, is found to be more properly described as a revolution in the quality of the labor, and to be connected with the fact of improvement generally, and to be evidence of improvement in the workman's condition. The character of labor generally has so changed that it can not really be measured in comparison with the labor of a former time. Some workmen engaged about machines may appear to get comparatively little of the increased production for themselves, but the reason is that the improvement in machines is for the benefit of society as a whole, and not specially for that of the particular workmen engaged upon them, who only participate in the improvement as consumers, and not as producers. Substantially, however, there is more severe toil all round, and whether the additional remuneration is adequate or not, the change in the quality of the labor is necessary to the production, the laborer gets all the possible remuneration, and the labor itself could not be carried on without the remuneration obtained. It is the same with the complaint as to the rise in the scale of living. The rise in the scale is at once a proof of the improvement in the workman's condition, and of the necessity for an improvement in his living to enable him to do the new work. The two things are inextricably connected. On the whole, the complaint of workmen as to the difference between gross and net is not unjustified, but it points to changes in their condition of a remarkable kind, which are in every way deserving of further study. To show fully what these changes are, statistics would be needed, but the necessary conditions of the problem are apparent without statistics. The complaints here dealt with could not exist without that improvement in society and the condition of the masses which the complaints seem to call in question. A further conclusion may be drawn. The conditions of life thus indicated seem favorable, on the whole, to a continuous improvement in society, so long as science and art make progress, and heavier and heavier calls are made on the intelligence and energy of workmen, along with an increase of their capacities on the one side and their wants on the other. The whole structure of modern society is such as to require greater and greater knowledge, greater and greater energy and moral power, greater and greater capacity of every kind, so as to make sure that machines and inventions are maintained and improved, and that artistic capacities and the arts of living are developed to correspond. The continuous improvement implies a continuous improvement, on the average, of the human being who really belongs to the new society. So long as society, therefore, continues to progress that is, for our present purpose, so long as the average workman continues to produce more quantity or better quality—there must be continuous improvement and progress in the quality of workmen themselves and the conditions of their existence, although we should not expect that complaints would cease as to the greater severity of toil and as to particular classes of workmen not getting for themselves the full benefit of the increased production. Still, the improvement is there, and the complaints, when analyzed, are, in truth, signs of the improvement.

The one doubtful sign, it appears to me, as regards the future, is pointed at by the qualification implied in the words—the human being who really belongs to the new society. It may possibly happen that there will be an increase, or at least non-diminution, of what may be called the social wreckage. A class may continue to exist and even increase in the midst of our civilization, possibly not a large class in proportion, but still a considerable class, who are out of the improvement altogether, who are capable of nothing but the rudest labor, and who have neither the moral nor the mental qualities fitted for the strain of the work of modern society. On the other side, as already hinted, the existence of what may be called a barbarian class among the capitalist classes, living in idle luxury and not bearing the burden of society in any way, seems also a danger. But speculations of this sort would perhaps take us too far at present. Substantially, as yet, there seems to be no reason to doubt the steadiness of the improvement in recent years among the working classes, both those practically so called and those who may be included when we use the language in its widest—that is, the strictly economic—sense, and that this improvement goes on from year to year, and from generation to generation, and must, in the nature of things, go on, in consequence of the improvements and inventions of the modern world and the general spread of education, so long as nothing happens to prevent a continuous improvement in the efficiency of human labor and the average return it can obtain from the forces with which it works.—Contemporary Review.

  1. See "Essays in Finance," second series, pp. 381, 382