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On the Economy of Machinery and Manufactures
by Charles Babbage
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360. One of the most legitimate and most important objects of such associations as we have just mentioned, is to agree upon ready and certain modes of measuring the quantity of work done by the workmen. For a long time a difficulty upon this point existed in the lace trade, which was justly complained of by the men as a serious grievance; but the introduction of the rack, which counts the number of holes in the length of the piece, has entirely put an end to the most fertile cause of disputes. This invention was adverted to by the Committee of 1812, and a hope was expressed, in their report, that the same contrivance would be applied to stocking-frames. It would, indeed, be of great mutual advantage to the industrious workman, and to the master manufacturer in every trade, if the machines employed in it could register the quantity of work which they perform, in the same manner as a steam-engine does the number of strokes it makes. The introduction of such contrivances gives a greater stimulus to honest industry than can readily be imagined, and removes one of the sources of disagreement between parties, whose real interests must always suffer by any estrangement between them.

361. The effects arising from combinations amongst the workmen, are almost always injurious to the parties themselves. There are numerous instances, in which the public suffer by increased price at the moment, but are ultimately gainers from the permanent reduction which results; whilst, on the other hand, the improvements which are often made in machinery in consequence of 'a strike' amongst the workmen, most frequently do injury, of greater or less duration, to that particular class which gave rise to them. As the injury to the men and to their families is almost always more serious than that which affects their employers, it is of the utmost importance to the comfort and happiness of the former class, that they should themselves entertain sound views upon this question. For this purpose a few illustrations of the principle which is here maintained, will probably have greater weight than any reasoning of a more general nature, though drawn from admitted principles of political economy. Such instances will, moreover, present the advantage of appealing to facts known to many individuals of those classes for whose benefit these reflections are intended.

362. There is a process in the manufacture of gun barrels for making what, in the language of the trade, are called skelps. The skelp is a piece or bar of iron, about three feet long, and four inches wide, but thicker and broader at one end than at the other; and the barrel of a musket is formed by forging out such pieces to the proper dimensions, and then folding or bending them into a cylindrical form, until the edges overlap, so that they can be welded together.

About twenty years ago, the workmen, employed at a very extensive factory in forging these skelps out of bar-iron, 'struck' for an advance of wages; and as their demands were very exorbitant, they were not immediately complied with. In the meantime, the superintendent of the establishment directed his attention to the subject; and it occurred to him, that if the circumference of the rollers, between which the bar-iron was rolled, were to be made equal to the length of a skelp, or of a musket barrel, and if also the groove in which the iron was compressed, instead of being of the same width and depth throughout, were cut gradually deeper and wider from a point on the rollers, until it returned to the same point, then the bar-iron passing between such rollers, instead of being uniform in width and thickness, would have the form of a skelp. On making the trial, it was found to succeed perfectly; a great reduction of human labour was effected by the process, and the workmen who had acquired peculiar skill in performing it ceased to derive any advantage from their dexterity.

363. It is somewhat singular that another and a still more remarkable instance of the effect of combination amongst workmen, should have occurred but a few years since in the very same trade. The process of welding the skelps, so as to convert them into gun barrels, required much skill, and after the termination of the war, the demand for muskets having greatly diminished, the number of persons employed in making them was very much reduced. This circumstance rendered combination more easy; and upon one occasion, when a contract had been entered into for a considerable supply to be delivered on a fixed day, the men all struck for such an advance of wages as would have caused the completion of the contract to be attended with a very heavy loss.

In this difficulty, the contractors resorted to a mode of welding the gun barrel, for which a patent had been taken out by one of themselves some years before this event. The plan had not then succeeded so well as to come into general use, in consequence of the cheapness of the usual mode of welding by hand labour, combined with some other difficulties with which the patentee had to contend. But the stimulus produced by the combination of the workmen, induced him to make new trials, and he was enabled to introduce such a facility in welding gun barrels by rollers, and such perfection in the work itself, that, in all probability, very few will in future be welded by hand labour.

This new process consisted in folding a bar of iron, about a foot long, into the form of a cylinder, with the edges a little overlapping. It was then placed in a furnace, and being taken out when raised to a welding heat, a triblet, or cylinder of iron, was placed in it, and the whole was passed quickly through a pair of rollers. The effect of this was, that the welding was performed at a single heating, and the remainder of the elongation necessary for extending the skelps to the length of the musket barrel, was performed in a similar manner, but at a lower temperature. The workmen who had combined were, of course, no longer wanted, and instead of benefiting themselves by their combination, they were reduced permanently, by this improvement in the art, to a considerably lower rate of wages: for as the process of welding gun barrels by hand required peculiar skill and considerable experience, they had hitherto been in the habit of earning much higher wages than other workmen of their class. On the other hand, the new method of welding was far less injurious to the texture of the iron, which was now exposed only once, instead of three or four times, to the welding heat, so that the public derived advantage from the superiority, as well as from the economy of the process. Another process has subsequently been invented, applicable to the manufacture of a lighter kind of iron tubes, which can thus be made at a price which renders their employment very general. They are now to be found in the shops of all our larger ironmongers, of various lengths and diameters, with screws cut at each end; and are in constant use for the conveyance of gas for lighting, or of water for warming, our houses. 364. Similar examples must have presented themselves to all those who are familiar with the details of our manufactories, but these are sufficient to illustrate one of the results of combinations. It would not, however, be fair to push the conclusion deduced from these instances to its extreme limit. Although it is very apparent, that in the two cases which have been stated, the effects of combination were permanently injurious to the workman, by almost immediately placing him in a lower class (with respect to his wages) than he occupied before; yet they do not prove that all such combinations have this effect. It is quite evident that they have all this tendency, it is also certain that considerable stimulus must be applied to induce a man to contrive a new and expensive process; and that in both these cases, unless the fear of pecuniary loss had acted powerfully, the improvement would not have been made. If, therefore, the workmen had in either case combined for only a small advance of wages, they would, in all probability, have been successful, and the public would have been deprived, for many years, of the inventions to which these combinations gave rise. It must, however, be observed, that the same skill which enabled the men to obtain, after long practice, higher wages than the rest of their class, would prevent many of them from being permanently thrown back into the class of ordinary workmen. Their diminished wages will continue only until they have acquired, by practice, a facility of execution in some other of the more difficult operations: but a diminution of wages, even for a year or two, is still a very serious inconvenience to any person who lives by his daily exertion. The consequence of combination has then, in these instances, been, to the workmen who combined—reduction of wages; to the public - reduction of price; and to the manufacturer increased sale of his commodity, resulting from that reduction.

365. It is, however, important to consider the effects of combination in another and less obvious point of view. The fear of combination amongst the men whom he employs, will have a tendency to induce the manufacturer to conceal from his workmen the extent of the orders he may at any time have received; and, consequently, they will always be less acquainted with the extent of the demand for their labour than they otherwise might be. This is injurious to their interests; for instead of foreseeing, by the gradual falling-off in the orders, the approach of a time when they must be unemployed, and preparing accordingly, they are liable to much more sudden changes than those to which they would otherwise be exposed.

In the evidence given by Mr Galloway, the engineer, he remarks, that,

"When employers are competent to show their men that their business is steady and certain, and when men find that they are likely to have permanent employment, they have always better habits, and more settled notions, which will make them better men, and better workmen, and will produce great benefits to all who are interested in their employment."

366. As the manufacturer, when he makes a contract, has no security that a combination may not arise amongst the workmen, which may render that contract a loss instead of a benefit; besides taking precautions to prevent them from becoming acquainted with it, he must also add to the price at which he could otherwise sell the article, some small increase to cover the risk of such an occurrence. If an establishment consist of several branches which can only be carried on jointly, as, for instance, of iron mines, blast furnaces, and a colliery, in which there are distinct classes of workmen, it becomes necessary to keep on hand a larger stock of materials than would be required, if it were certain that no combinations would arise.

Suppose, for instance, the colliers were to 'strike' for an advance of wages—unless there was a stock of coal above ground, the furnaces must be stopped, and the miners also would be thrown out of employ. Now the cost of keeping a stock of iron ore, or of coals above ground, is just the same as that of keeping in a drawer, unemployed, its value in money, (except, indeed, that the coal suffers a small deterioration by exposure to the elements). The interest of this sum must, therefore, be considered as the price of an insurance against the risk of combination amongst the workmen; and it must, so far as it goes, increase the price of the manufactured article, and, consequently, limit the demand which would otherwise exist for it. But every circumstance which tends to limit the demand, is injurious to the workmen; because the wider the demand, the less it is exposed to fluctuation.

The effect to which we have alluded, is by no means a theoretical conclusion; the proprietors of one establishment in the iron trade, within the author's knowledge, think it expedient always to keep above ground a supply of coal for six months, which is, in that instance, equal in value to about L10,000. When we reflect that the quantity of capital throughout the country thus kept unemployed merely from the fear of combinations amongst the workmen, might, under other circumstances, be used for keeping a larger number at work, the importance of introducing a system in which there should exist no inducement to combine becomes additionally evident.

367. That combinations are, while they last, productive of serious inconveniences to the workmen themselves, is admitted by all parties; and it is equally true, that, in most cases, a successful result does not leave them in so good a condition as they were in before 'the strike'. The little capital they possessed, which ought to have been hoarded with care for days of illness or distress, is exhausted; and frequently, in order to gratify a pride, at the existence of which we cannot but rejoice, even whilst we regret its misdirected energy, they will undergo the severest privations rather than return to work at their former wages. With many of the workmen, unfortunately, during such periods, bad habits are formed which it is very difficult to eradicate; and, in all those engaged in such transactions, the kinder feelings of the heart are chilled, and passions are called into action which are permanently injurious to the happiness of the individual, and destructive of those sentiments of confidence which it is equally the interest of the master manufacturer and of his workman to maintain. If any of the trade refuse to join in the strike, the majority too frequently forget, in the excitement of their feelings, the dictates of justice, and endeavour to exert a species of tyranny, which can never be permitted to exist in a free country. In conceding therefore to the working classes, that they have a right, if they consider it expedient, to combine for the purpose of procuring higher wages (provided always, that they have completed all their existing contracts), it ought ever to be kept before their attention, that the same freedom which they claim for themselves they are bound to allow to others, who may have different views of the advantages of combination. Every effort which reason and kindness can dictate, should be made, not merely to remove their grievances, but to satisfy their own reason and feelings, and to show them the consequences which will probably result from their conduct: but the strong arm of the law, backed, as in such cases it will always be, by public opinion, should be instantly and unhesitatingly applied, to prevent them from violating the liberty of a portion of their own, or of any other class of society.

368. Amongst the evils which ultimately fall heavy on the working classes themselves, when, through mistaken views, they attempt to interfere with their employers in the mode of carrying on their business, may be mentioned the removal of factories to other situations, where the proprietors may be free from the improper control of their men. The removal of a considerable number of lace frames to the western counties, which took place, in consequence of the combinations in Nottinghamshire, has already been mentioned. Other instances have occurred, where still greater injury has been produced by the removal of a portion of the skill and capital of the country to a foreign land. Such was the case at Glasgow, as stated in the fifth Parliamentary Report respecting Artizans and Machinery. One of the partners in an extensive cotton factory, disgusted by the unprincipled conduct of the workmen, removed to the state of New Y ork, where he re-established his machinery, and thus afforded, to rivals already formidable to our trade, at once a pattern of our best machinery, and an example of the most economical methods of employing it.

369. When the nature of the work is such that it is not possible to remove it, as happens with regard to mines, the proprietors are more exposed to injury from combinations amongst the workmen: but as the owners are generally possessed of a larger capital, they generally succeed, if the reduction of wages which they propose is really founded on the necessity of the case.

An extensive combination lately existed amongst the colliers in the north of England, which unfortunately led, in several instances, to acts of violence. The proprietors of the coalmines were consequently obliged to procure the aid of miners from other parts of England who were willing to work at the wages they could afford to give; and the aid of the civil, and in some cases of the military, power, was requisite for their protection. This course was persisted in during several months, and the question being, which party could support itself longest on the diminished gains, as it might have readily been foreseen, the proprietors ultimately succeeded.

370. One of the remedies employed by the masters against the occurrence of combinations, is to make engagements with their men for long periods and to arrange them in such a manner, that these contracts shall not all terminate together. This has been done in some cases at Sheffield, and in other places. It is attended with the inconvenience to the masters that, during periods when the demand for their produce is reduced, they are still obliged to employ the same number of workmen. This circumstance, however, frequently obliges the proprietors to direct their attention to improvements in their works: and in one such instance, within the author's knowledge, a large reservoir was deepened, thus affording a more constant supply to the water-wheel, whilst, at the same time, the mud from the bottom gave permanent fertility to a piece of land previously almost barren. In this case, not merely was the supply of produce checked, when a glut existed. but the labour was, in fact, applied more profitably than it would have been in the usual course.

371. A mode of paying the wages of workmen in articles which they consume, has been introduced into some of our manufacturing districts, which has been called the truck system. As in many instances this has nearly the effect of a combination of the masters against the men, it is a fit subject for discussion in the present chapter: but it should be carefully distinguished from another system of a very different tendency, which will be first described.

372. The principal necessaries for the support of a workman and his family are few in number, and are usually purchased by him in small quantities weekly. Upon such quantities, sold by the retail dealer, a large profit is generally made; and if the article is one whose quality, like that of tea, is not readily estimated, then a great additional gain is made by the retail dealer selling an inferior article.

Where the number of workmen living on the same spot is large, it may be thought desirable that they should unite together and have an agent, to purchase by wholesale those articles which are most in demand, as tea, suger, bacon, etc., and to retail them at prices, which will just repay the wholesale cost, together with the expense of the agent who conducts their sale. If this be managed wholly by a committee of workmen, aided perhaps by advice from the master, and if the agent is paid in such a manner as to have himself an interest in procuring good and reasonable articles, it may be a benefit to the workmen: and if the plan succeed in reducing the cost of articles of necessity to the men, it is clearly the interest of the master to encourage it. The master may indeed be enabled to afford them facilities in making their wholesale purchases; but he ought never to have the least interest in, or any connection with, the profit made by the articles sold. The men, on the other hand, who subscribe to set up the shop, ought not, in the slightest degree, to be compelled to make their purchases there: the goodness and cheapness of the article ought to be their sole inducements.

It may perhaps be objected, that this plan is only employing a portion of the capital belonging to the workmen in a retail trade; and that, without it, competition amongst small shopkeepers will reduce the articles to nearly the same price. This objection would be valid if the objects of consumption required no verification; but combining what has been already stated on that subject(1*) with the present argument, the plan seems liable to no serious objections.

373. The truck system is entirely different in its effects. The master manufacturer keeps a retail shop for articles required by his men, and either pays their wages in goods, or compels them by express agreement, or less directly, by unfair means, to expend the whole or a certain part of their wages at his shop. If the manufacturer kept this shop merely for the purpose of securing good articles, at fair prices, to his workmen, and if he offered no inducement to them to purchase at his shop, except the superior cheapness of his articles, it would certainly be advantageous to the men. But, unfortunately, this is not always the case; and the temptation to the master, in times of depression, to reduce in effect the wages which he pays (by increasing the price of articles at his shop), without altering the nominal rate of payment, is frequently too great to be withstood. If the object be solely to procure for his workmen better articles, it will be more effectually accomplished by the master confining himself to supplying a small capital, at a moderate rate of interest; leaving the details to be conducted by a committee of workmen, in conjunction with his own agent, and the books of the shop to be audited periodically by the men themselves.

374. Wherever the workmen are paid in goods, or are compelled to purchase at the master's shop, much injustice is done to them, and great misery results from it. Whatever may have been the intentions of the master in such cases, the real effect is, to deceive the workman as to the amount he receives in exchange for his labour. Now, the principles on which the happiness of that class of society depends, are difficult enough to be understood, even by those who are blessed with far better opportunities of investigating them: and the importance of their being well acquainted with those principles which relate to themselves, is of more vital consequence to workmen, than to many other classes. It is therefore highly desirable to assist them in comprehending the position in which they are placed, by rendering all the relations in which they stand to each other, and to their employers, as simple as possible. Workmen should be paid entirely in money; their work should be measured by some unbiassed, some unerring piece of mechanism; the time during which they are employed should be defined, and punctually adhered to. The payments they make to their benefit societies should be fixed on such just principles, as not to require extraordinary contributions. In short, the object of all who wish to promote their happiness should be, to give them, in the simplest form, the means of knowing beforehand, the sum they are likely to acquire by their labour, and the money they will be obliged to expend for their support: thus putting before them, in the clearest light, the certain result of persevering industry.

375. The cruelty which is inflicted on the workman by the payment of his wages in goods, is often very severe. The little purchases necessary for the comfort of his wife and children, perhaps the medicines he occasionally requires for them in illness, must all be made through the medium of barter; and he is obliged to waste his time in arranging an exchange, in which the goods which he has been compelled to accept for his labour are invariably taken at a lower price than that at which his master charged them to him. The father of a family perhaps, writhing under the agonies of the toothache, is obliged to make his hasty bargain with the village surgeon, before he will remove the cause of his pain; or the disconsolate mother is compelled to sacrifice her depreciated goods in exchange for the last receptacle of her departed offspring. The subjoined evidence from the Report of the Committee of the House of Commons on Framework Knitters' Petitions, shows that these are not exaggerated statements.

It has been so common in our town to pay goods instead of money, that a number of my neighbours have been obliged to pay articles for articles, to pay sugar for drugs out of the druggist's shop; and others have been obliged to pay sugar for drapery goods, and such things, and exchange in that way numbers of times. I was credibly informed, that one person paid half a pound of tenpenny sugar and a penny to have a tooth drawn; and there is a credible neighbour of mine told me, that he had heard that the sexton had been paid for digging a grave with sugar and tea: and before I came off, knowing I had to give evidence upon these things, I asked this friend to enquire ofthe sexton, whether this was a fact: the sexton hesitated for a little time, on account of bringing into discredit the person who paid these goods: however, he said at last, 'I have received these articles repeatedly—I know these things have been paid to a great extent in this way.'

NOTES:

1. See Chapter XV, p. 87



Chapter 31

On Combinations of Masters against the public

376. A species of combination occasionally takes place amongst manufacturers against persons having patents: and these combinations are always injurious to the public, as well as unjust to the inventors. Some years since, a gentleman invented a machine, by which modellings and carvings were cut in mahogany, and other fine woods. The machine resembled, in some measure, the drilling apparatus employed in ornamental lathes; it produced beautiful work at a very moderate expense: but the cabinetmakers met together, and combined against it, and the patent has consequently never been worked. A similar fate awaited a machine for cutting veneers by means of a species of knife. In this instance, the wood could be cut thinner than by the circular saw, and no waste was incurred; but 'the trade' set themselves against it, and after a heavy expense, it was given up.

The excuse alleged for this kind of combination, was the fear entertained by the cabinetmakers that when the public became acquainted with the article, the patentee would raise the price.

Similar examples of combination seem not to be unfrequent, as appears by the Report of the Committee of the House of Commons on Patents for Inventions, June, 1829. See the evidence of Mr Holdsworth.

377. There occurs another kind of combination against the public, with which it is difficult to deal. It usually ends in a monopoly, and the public are then left to the discretion of the monopolists not to charge them above the growling point—that is, not to make them pay so much as to induce them actually to combine against the imposition. This occurs when two companies supply water or gas to consumers by means of pipes laid down under the pavement in the street of cities: it may possibly occur also in docks, canals, railroads, etc., and in other cases where the capital required is very large, and the competition very limited. If water or gas companies combine, the public immediately loses all the advantage of competition, and it has generally happened, that at the end of a period during which they have undersold each other, the several companies have agreed to divide the whole district supplied, into two or more parts, each company then removing its pipes from all the streets except those in its own portion. This removal causes great injury to the pavement, and when the pressure of increased rates induces a new company to start, the same inconvenience is again produced. Perhaps one remedy against evils of this kind might be, when a charter is granted to such companies, to restrict, to a certain amount, the rate of profit on the shares, and to direct that any profits beyond, shall accumulate for the repayment of the original capital. This has been done in several late Acts of Parliament establishing companies. The maximum rate of profit allowed ought to be liberal, to compensate for the risk; the public ought to have auditors on their part, and the accounts should be annually published, for the purpose of preventing the limitations from being exceeded. It must however be admitted, that this would be an interference with capital, which, if allowed, should, in the present state of our knowledge, be. examined with great circumspection in each individual case, until some general principle is established on well-admitted grounds.

378. An instrument called a gas-meter, which ascertains the quantity of gas used by each consumer, has been introduced, and furnishes a satisfactory mode of determining the payments to be made by individuals to the gas companies. A contrivance somewhat similar in its nature, might be used for the sale of water; but in that case some public inconvenience might be apprehended, from the diminished quantity which would then run to waste: the streams of water running through the sewers in London, are largely supplied from this source; and if this supply were diminished, the drainage of the metropolis might be injuriously affected.

379. In the north of England a powerful combination has long existed among the coal-owners, by which the public has suffered in the payment of increased price. The late examination of evidence before a Committee of the House of Commons, has explained its mode of operation, and the Committee have recommended, that for the present the sale of coal should be left to the competition of other districts.

380. A combination, of another kind, exists at this moment to a great extent, and operates upon the price of the very pages which are now communicating information respecting it. A subject so interesting to every reader, and still more so to every manufacturer ofthe article which the reader consumes, deserves an attentive examination.

We have shown in Chapter XXI, p. 144, the component parts of the expense of each copy of the present work; and we have seen that the total amount of the cost of its production, exclusive of any payment to the author for his labour, is 2s. 3d.(1*)

Another fact, with which the reader is more practically familiar, is that he has paid, or is to pay, to his bookseller, six shillings for the volume. Let us now examine into the distribution of these six shillings, and then, having the facts ofthe case before us, we shall be better able to judgeofthe meritsofthe combinationjust mentioned, andtoexplainits effects.

Distribution of the profits on a six shilling book

Buys at; Sells at; Profit on capital expended s. d.; s. d.

No. I—The publisher who accounts to the author for every copy received; 3 10; 4 2; 10 per cent No. II—The bookseller who retails to the public; 4 2; 6 0; 44 Or, 4 6; 6 0; 33 1/3

No. I, the publisher, is a bookseller; he is, in fact, the author's agent. His duties are, to receive and take charge of the stock, for which he supplies warehouse room; to advise the author about the times and methods of advertising; and to insert the advertisements. As he publishes other books, he will advertise lists of those sold by himself; and thus, by combining many in one advertisement, diminish the expense to each of his principals. He pays the author only for the books actually sold; consequently, he makes no outlav of capital, except that which he pays for advertisements: but he is answerable for any bad debts he may contract in disposing of them. His charge is usually ten per cent on the returns.

No. II is the bookseller who retails the work to the public. On the publication of a new book, the publisher sends round to the trade, to receive 'subscriptions' from them for any number of copies not less than two These copies are usually charged to the 'subscribers', on an average, at about four or five per cent less than the wholesale price of the book: in the present case the subscription price is 4s. 2d. for each copy. After the day of publication, the price charged by the publisher to the booksellers is 4s. 6d. With some works it is the custom to deliver twentyfive copies to those who order twenty-four, thus allowing a reduction of about four per cent. Such was the case with the present volume. Different publishers offer different terms to the subscribers; and it is usual, after intervals of about six months, for the publisher again to open a subscription list, so that if the work be one for which there is a steady sale, the trade avail themselves of these opportunities ofpurchasing, at the reduced rate, enough to supply their probable demand.(2*)

381. The volume thus purchased of the publisher at 4s. 2d. or 4s. 6d. is retailed by the bookseller to the public at 6s. In the first case he makes a profit of forty-four, in the second of thirty-three per cent. Even the smaller of these two rates of profit on the capital employed, appears to be much too large. It may sometimes happen, that when a book is enquired for, the retail dealer sends across the street to the wholesale agent, and receives, for this trifling service, one fourth part of the money paid by the purchaser; and perhaps the retail dealer takes also six months' credit for the price which the volume actually cost him.

382. In section 256, the price of each process in manufacturing the present volume was stated: we shall now give an analysis of the whole expense of conveying it into the hands of the public.

The retail price 6s. on 3052 produces 915 12 0

1. Total expense of printing and paper 207 5 8 7/11 2. Taxes on paper and advertisements 40 0 11 3. Commission to publisher as agent between author and printer 18 14 4 4/11 4 Commission to publisher as agent for sale of the book 63 11 8 5. Profit—the difference between subscription price and trade price, 4d. per vol. 50 17 4 6. Profit the difference between trade price and retail price, 1s. 6d. per vol. 228 18 0 362 1 4 7. Remains for authorship 306 4 0

Total 915 12 0

This account appears to disagree with that in page 146. but it will be observed that the three first articles amount to L266 1s., the sum there stated. The apparent difference arises from a circumstance which was not noticed in the first edition of this work. The bill amounting to L205 18s., as there given, and as reprinted in the present volume, included an additional charge of ten per cent upon the real charges of the printer and paper-maker.

383. It is usual for the publisher, when he is employed as agent between the author and printer, to charge a commission of ten per cent on all payments he makes. If the author is informed of this custom previously to his commencing the work, as was the case in the present instance, he can have no just cause of complaint; for it is optional whether he himself employs the printer, or communicates with him through the intervention of his publisher.

The services rendered for this payment are, the making arrangements with the printer, the wood-cutter, and the engraver, if required. There is a convenience in having some intermediate person between the author and printer, in case the former should consider any of the charges made by the latter as too high. When the author himself is quite unacquainted with the details of the art of printing, he may object to charges which, on a better acquaintance with the subject, he might be convinced were very moderate; and in such cases he ought to depend on the judgement of his publisher, who is generally conversant with the art. This is particularly the case in the charge for alterations and corrections, some of which, although apparently trivial, occupy the compositors much time in making. It should also be observed that the publisher, in this case, becomes responsible for the payments to those persons.

384. It is not necessary that the author should avail himself of this intervention, although it is the interest of the publisher that he should; and booksellers usually maintain that the author cannot procure his paper or printing at a cheaper rate if he go at once to the producers. This appears from the evidence given before the Committee of the House of Commons in the Copyright Acts, 8 May, 1818.

Mr O. Rees, bookseller, of the house of Longman and Co., Paternoster Row, examined:

Q. Suppose a gentleman to publish a work on his own account, and to incur all the various expenses; could he get the paper at 30s. a ream?

A. I presume not; I presume a stationer would not sell the paper at the same price to an indifferent gentleman as to the trade.

Q. The Committee asked you if a private gentleman was to publish a work on his own account, if he would not pay more for the paper than persons in the trade; the Committee wish to be informed whether a printer does not charge a gentleman a higher rate than to a publisher.

A. I conceive they generally charge a profit on the paper.

Q. Do not the printers charge a higher price also for printing, than they do to the trade?

A. I always understood that they do.

385. There appears to be little reason for this distinction in charging for printing a larger price to the author than to the publisher, provided the former is able to give equal security for the payment. With respect to the additional charge on paper, if the author employs either publisher or printer to purchase it, they ought to receive a moderate remuneration for the risk, since they become responsible for the payment; but there is no reason why, if the author deals at once with the paper-maker, he should not purchase on the same terms as the printer; and if he choose, by paying ready money, not to avail himself of the long credit allowed in those trades, he ought to procure his paper considerably cheaper.

386. It is time, however, that such conventional combinations between different trades should be done away with. In a country so eminently depending for its wealth on its manufacturing industry, it is of importance that there should exist no abrupt distinction of classes, and that the highest of the aristocracy should feel proud of being connected, either personally or through their relatives, with those pursuits on which their country's greatness depends. The wealthier manufacturers and merchants already mix with those classes, and the larger and even the middling tradesmen are frequently found associating with the gentry of the land. It is good that this ambition should be cultivated, not by any rivalry in expense, but by a rivalry in knowledge and in liberal feelings; and few things would more contribute to so desirable an effect, than the abolition of all such contracted views as those to which we have alluded. The advantage to the other classes, would be an increased acquaintance with the productive arts of the country an increased attention to the importance of acquiring habits of punctuality and of business and, above all, a general feeling that it is honourable, in any rank of life, to increase our own and our country's riches, by employing our talents in the production or in the distribution of wealth.

387. Another circumstance omitted to be noticed in the first edition relates to what is technically called the overplus, which may be now explained. When 500 copies of a work are to be printed, each sheet of it requires one ream of paper. Now a ream, as used by printers, consists of 21 1/2 quires, or 516 sheets. This excess of sixteen sheets is necessary in order to allow for 'revises'—for preparing and adjusting the press for the due performance of its work, and to supply the place of any sheets which may be accidentally dirtied or destroyed in the processes of printing, or injured by the binder in putting into boards. It is found, however, that three per cent is more than the proportion destroyed, and that damage is less frequent in proportion to the skill and care of the workmen.

From the evidence of several highly respectable booksellers and printers, before the Committee of the House of Commons on the Copyright Act, May, 1818, it appears that the average number of surplus copies, above 500, is between two and three; that on smaller impressions it is less, whilst on larger editions it is greater; that, in some instances, the complete number of 500 is not made up, in which case the printer is obliged to pay for completing it; and that in no instance have the whole sixteen extra copies been completed. On the volume in the reader's hands, the edition of which consisted of 3000, the surplus amounted to fifty-two—a circumstance arising from the improvements in printing and the increased care of the pressmen. Now this overplus ought to be accounted for to the author—and I believe it usually is so by all respectable publishers.

388. In order to prevent the printer from privately taking off a larger number of impressions than he delivers to the author or publisher, various expedients have been adopted. In some works a particular watermark has been used in paper made purposely for the book: thus the words 'Mecanique Celeste' appear in the watermark of the two first volumes of the great work of Laplace. In other cases, where the work is illustrated by engravings, such a fraud would be useless without the concurrence of the copperplate printer. In France it is usual to print a notice on the back of the title page, that no copies are genuine without the subjoined signature of the author: and attached to this notice is the author's name, either written, or printed by hand from a wooden block. But notwithstanding this precaution, I have recently purchased a volume, printed at Paris, in which the notice exists, but no signature is attached. In London there is not much danger of such frauds, because the printers are men of capital, to whom the profit on such a transaction would be trifling, and the risk of the detection of a fact, which must of necessity be known to many of their workmen, would be so great as to render the attempt at it folly.

389. Perhaps the best advice to an author, if he publishes on his own account, and is a reasonable person, possessed of common sense, would be to go at once to a respectable printer and make his arrangements with him.

390. If the author do not wish to print his work at his own risk, then he should make an agreement with a publisher for an edition of a limited number; but he should by no means sell the copyright. If the work contains woodcuts or engravings, it would be judicious to make it part of the contract that they shall become the author's property, with the view to their use in a subsequent edition of the works, if they should be required. An agreement is frequently made by which the publisher advances the money and incurs all the risk on condition of his sharing the profits with the author. The profits alluded to are, for the present work, the last item of section 382, or L306 4s.

391. Having now explained all the arrangements in printing the present volume, let us return to section 382, and examine the distribution of the L915 paid by the public. Of this sum L207 was the cost of the book, L40 was taxes, L3S2 was the charges of the bookseller in conveying it to the consumer, and L306 remained for authorship.

The largest portion, or L362 goes into the pockets of the booksellers; and as they do not advance capital, and incur very little risk, this certainly appears to be an unreasonable allowance. The most extravagant part of the charge is the thirty-three per cent which is allowed as profit on retailing the book.

It is stated, however, that all retail booksellers allow to their customers a discount of ten per cent upon orders above 20s., and that consequently the nominal profit of forty-four or thirty-three per cent is very much reduced. If this is the case, it may fairly be enquired, why the price of L2 for example, is printed upon the back of a book, when every bookseller is ready to sell it at L1 16s., and why those who are unacquainted with that circumstance should be made to pay more than others who are better informed?

392. Several reasons have been alleged as justifying this high rate of profit.

First, it has been alleged that the purchasers of books take long credit. This, probably, is often the case, and admitting it, no reasonable person can object to a proportionate increase of price. But it is no less clear, that persons who do pay ready money, should not be charged the same price as those who defer their payments to a remote period.

Secondly, it has been urged that large profits are necessary to pay for the great expenses of bookselling establishments; that rents are high and taxes heavy; and that it would be impossible for the great booksellers to compete with the smaller ones, unless the retail profits were great. In reply to this it may be observed that the booksellers are subject to no peculiar pressure which does not attach to all other retail trades. It may also be remarked that large establishments always have advantages over smaller ones, in the economy arising from the division of labour; and it is scarcely to be presumed that booksellers are the only class who, in large concerns, neglect to avail themselves of them.

Thirdly, it has been pretended that this high rate of profit is necessary to cover the risk of the bookseller's having some copies left on his shelves; but he is not obliged to buy of the publisher a single copy more than he has orders for: and if he do purchase more, at the subscription price, he proves, by the very fact, that he himself does not estimate that risk at more than from four to eight per cent.

393. It has been truly observed, on the other hand, that many copies of books are spoiled by persons who enter the shops of booksellers without intending to make any purchase. But, not to mention that such persons finding on the tables various new publications, are frequently induced, by that opportunity of inspecting them, to become purchasers: this damage does not apply to all booksellers nor to all books; of course it is not necessary to keep in the shop books of small probable demand or great price. In the present case, the retail profit on three copies only, namely, 4s. 6d., would pay the whole cost of the one copy soiled in the shop; and even that copy might afterwards produce, at an auction, half or a third of its cost price. The argument, therefore, from disappointments in the sale of books, and that arising from heavy stock, are totally groundless in the question between publisher and author. It shold be remarked also, that the publisher is generally a retail, as well as a wholesale, bookseller; and that, besides his profit upon every copy which he sells in his capacity of agent, he is allowed to charge the author as if every copy had been subscribed for at 4s. 2d., and of course he receives the same profit as the rest of the wholesale traders for the books retailed in his own shop.

394. In the country, there is more reason for a considerable allowance between the retail dealer and the public; because the profit of the country bookseller is diminished by the expense of the carriage of the books from London. He must also pay a commission, usually five per cent, to his London agent, on all those books which his correspondent does not himself publish. If to this be added a discount of five per cent, allowed for ready money to every customer, and of ten per cent to book clubs, the profit of the bookseller in a small country town is by no means too large.

Some of the writers, who have published criticisms on the observations made in the first edition of this work, have admitted that the apparent rate of profit to the booksellers is too large. But they have, on the other hand, urged that too favourable a case is taken in supposing the whole 3000 copies sold. If the reader will turn back to section 382, he will find that the expense of the three first items remains the same, whatever be the number of copies sold; and on looking over the remaining items he will perceive that the bookseller, who incurs very little risk and no outlay, derives exactly the same profit per cent on the copies sold, whatever their numbers may be. This, however, is not the case with the unfortunate author, on whom nearly the whole of the loss falls undivided. The same writers have also maintained, that the profit is fixed at the rate mentioned, in order to enable the bookseller to sustain losses, unavoidably incurred in the purchase and retail of other books. This is the weakest of all arguments. It would be equally just that a merchant should charge an extravagant commission for an undertaking unaccompanied with any risk, in order to repay himself for the losses which his own want of skill might lead to in his other mercantile transactions.

395. That the profit in retailing books is really too large, is proved by several circumstances: First, that the same nominal rate of profit has existed in the bookselling trade for a long series of years, notwithstanding the great fluctuations in the rate of profit on capital invested in every other business. Secondly, that, until very lately, a multitude of booksellers, in all parts of London, were content with a much smaller profit, and were willing to sell for ready money, or at short credit, to persons of undoubted character, at a profit of only ten per cent, and in some instances even at a still smaller percentage, instead of that of twenty-five per cent on the published prices. Thirdly, that they are unable to maintain this rate of profit except by a combination, the object of which is to put down all competition.

396. Some time ago a small number of the large London booksellers entered into such a combination. One of their objects was to prevent any bookseller from selling books for less than ten per cent under the published prices; and in order to enforce this principle, they refuse to sell books, except at the publishing price, to any bookseller who declines signing an agreement to that effect. By degrees, many were prevailed upon to join this combination; and the effect of the exclusion it inflicted, left the small capitalist no option between signing or having his business destroyed. Ultimately, nearly the whole trade, comprising about two thousand four hundred persons, have been compelled to sign the agreement.

As might be naturally expected from a compact so injurious to many of the parties to it, disputes have arisen; several booksellers have been placed under the ban of the combination, who allege that they have not violated its rules, and who accuse the opposite party of using spies, etc., to entrap them.(3*)

397. The origin of this combination has been explained by Mr Pickering, of Chancery Lane, himself a publisher, in a printed statement, entitled, 'Booksellers' Monopoly' and the following list of booksellers, who form the committee for conducting this combination, is copied from that printed at the head of each of the cases published by Mr Pickering:

Allen, J., 7, Leadenhall Street. Arch, J., 61, Cornhill. Baldwin, R., 47, Paternoster Row. Booth, J. Duncan, J., 37, Paternoster Row. Hatchard, J., Piccadilly. Marshall, R., Stationers' Court. Murray, J., Albemarle Street. Rees, O., 39, Paternoster Row. Richardson, J. M., 23, Cornhill. Rivington, J., St. Paul's Churchyard. Wilson, E., Royal Exchange.

398. In whatever manner the profits are divided between the publisher and the retail bookseller, the fact remains, that the reader pays for the volume in his hands 6s., and that the author will receive only 3s. 10d.; out of which latter sum, the expense of printing the volume must be paid: so that in passing through two hands this book has produced a profit of forty-four per cent. This excessive rate of profit has drawn into the book trade a larger share of capital than was really advantageous; and the competition between the different portions of that capital has naturally led to the system of underselling, to which the committee above mentioned are endeavouring to put a stop.(4*)

399. There are two parties who chiefly suffer from this combination, the public and authors. The first party can seldom be induced to take an active part against any grievance; and in fact little is required from it, except a cordial support of the authors, in any attempt to destroy a combination so injurious to the interests of both.

Many an industrious bookseller would be glad to sell for 5s. the volume which the reader holds in his hand, and for which he has paid 6s.; and, in doing so for ready money, the tradesman who paid 4s. 6d. for the book, would realize, without the least risk, a profit of eleven per cent on the money he had advanced. It is one of the objects of the combination we are discussing, to prevent the small capitalist from employing his capital at that rate of profit which he thinks most advantageous to himself; and such a proceeding is decidedly injurious to the public.

400. Having derived little pecuniary advantage from my own literary productions; and being aware, that from the very nature of their subjects, they can scarcely be expected to reimburse the expense of preparing them, I may be permitted to offer an opinion upon the subject, which I believe to be as little influenced by any expectation of advantage from the future, as it is by any disappointment at the past.

Before, however, we proceed to sketch the plan of a campaign against Paternoster Row, it will be fit to inform the reader of the nature of the enemies' forces, and of his means of attack and defence. Several of the great publishers find it convenient to be the proprietors of reviews, magazines, journals, and even of newspapers. The editors are paid, in some instances very handsomely, for their superintendence; and it is scarcely to be expected that they should always mete out the severest justice on works by the sale of which their employers are enriched. The great and popular works of the day are, of course, reviewed with some care, and with deference to public opinion. Without this, the journals would not sell; and it is convenient to be able to quote such articles as instances of impartiality. Under shelter of this, a host of ephemeral productions are written into a transitory popularity; and by the aid of this process, the shelves of the booksellers, as well as the pockets of the public, are disencumbered. To such an extent are these means employed, that some of the periodical publications of the day ought to be regarded merely as advertising machines. That the reader may be in some measure on his guard against such modes of influencing his judgement, he should examine whether the work reviewed is published by the bookseller who is the proprietor of the review; a fact which can sometimes be ascertained from the title of the book as given at the head of the article. But this is by no means a certain criterion, because partnerships in various publications exist between houses in the book trade, which are not generally known to the public; so that, in fact, until reviews are established in which booksellers have no interest, they can never be safely trusted.

401. In order to put down the combination of booksellers, no plan appears so likely to succeed as a counter-association of authors. If any considerable portion of the literary world were to unite and form such an association; and if its affairs were directed by an active committee, much might be accomplished. The objects of such an union should be, to employ some person well skilled in the printing, and in the bookselling trade; and to establish him in some central situation as their agent. Each member of the association to be at liberty to place any, or all of his works in the hands of this agent for sale; to allow any advertisements, or list of books published by members of the association, to be stitched up at the end of each of his own productions; the expense of preparing them being defrayed by the proprietors of the books advertised.

The duties of the agent would be to retail to the public, for ready money, copies of books published by members of the association. To sell to the trade, at prices agreed upon, any copies they may require. To cause to be inserted in the journals, or at the end of works published by members, any advertisements which the committee or authors may direct. To prepare a general catalogue of the works of members. To be the agent for any member of the association respecting the printing of any work.

Such a union would naturally present other advantages; and as each author would retain the liberty of putting any price he might think fit on his productions, the public would have the advantage of reduction in price produced by competition between authors on the same subject, as well as of that arising from a cheaper mode of publishing the volumes sold to them.

402. Possibly, one of the consequences resulting from such an association, would be the establishment of a good and an impartial review, a work the want of which has been felt for several years. The two long-established and celebrated reviews, the unbending champions of the most opposite political opinions. are, from widely differing causes, exhibiting unequivocal signs of decrepitude and decay. The quarterly advocate of despotic principles is fast receding from the advancing intelligence of the age; the new strength and new position which that intelligence has acquired, demands for its expression, new organs, equally the representatives of its intellectual power, and of its moral energies: whilst, on the other hand, the sceptre of the northern critics has passed, from the vigorous grasp of those who established its dominion, into feebler hands.

403. It may be stated as a difficulty in realizing this suggestion, that those most competent to supply periodical criticism, are already engaged. But it is to be observed, that there are many who now supply literary criticisms to journals, the political principles of which they disapprove; and that if once a respectable and well-supported review(5*) were established, capable of competing, in payment to its contributors, with the wealthiest of its rivals, it would very soon be supplied with the best materials the country can produce. (6*) It may also be apprehended that such a combination of authors would be favourable to each other. There are two temptations to which an editor of a review is commonly exposed: the first is, a tendency to consult too much, in the works he criticizes, the interest of the proprietor of his review; the second, a similar inclination to consult the interests of his friends. The plan which has been proposed removes one of these temptations, but it would be very difficult, if not impossible, to destroy the other.

NOTES:

1. The whole of the subsequent details relate to the first edition of this work.

2. These details vary with different books and different publishers; those given in the text are believed to substantially correct, and are applicable to works like the present.

3. It is now understood that the use of spies has been given up; and it is also known that the system of underselling is again privately resorted to by many, so that the injury arising from this arbitrary system, pursued by the great booksellers, affects only, or most severely, those whose adherence to an extorted promise most deserves respect. Note to the second edition.

4 The monopoly cases. Nos. 1. 2. and 3. of those published by Mr Pickering, should be consulted upon this point; and, as the public will be better able to form a judgement by hearing the other side of the question, it is to be hoped the Chairman of the Committee (Mr Richardson) will publish those regulations respecting the trade, a copy of which. Mr Pickering states, is refused by the Committee even to those who sign them.

5. At the moment when this opinion as to the necessity for a new review was passing through the press. I was informed that the elements of such an undertaking were already organized.

6. I have been suggested to me, that the doctrines maintained in this chapter may subject the present volume to the opposition of that combination which it has opposed. I do not entertain that opinion; and for this reason, that the booksellers are too shrewd a class to supply such an admirable passport to publicity as their opposition would prove to be if generally suspected. But should my readers take a different view of the question, they can easily assist in remedying the evil, by each mentioning the existence of this little volume to two of his friends.

{I was wrong in this conjecture; all booksellers are not so shrewd as I had imagined, for some did refuse to sell this volume; consequently others sold a larger number of copies.

In the preface to the second edition, at the commencement of this volume, the reader will find some further observation on the effect of the booksellers' combination.}



Chapter 32

On the Effect of Machinery in Reducing the Demand for Labour

404. One of the objections most frequently urged against machinery is, that it has a tendency to supersede much of the hand labour which was previously employed; and in fact unless a machine diminished the labour necessary to make an article, it could never come into use. But if it have that effect, its owner, in order to extend the sale of his produce, will be obliged to undersell his competitors; this will induce them also to introduce the new machine, and the effect of this competition will soon cause the article to fall, until the profits on capital, under the new system, shall be reduced to the same rate as under the old. Although, therefore, the use of machinery has at first a tendency to throw labour out of employment, yet the increased demand consequent upon the reduced price, almost immediately absorbs a considerable portion of that labour, and perhaps, in some cases, the whole of what would otherwise have been displaced.

That the effect of a new machine is to diminish the labour required for the production of the same quantity of manufactured commodities may beclearlyperceived, byimaginingasociety, inwhichoccupation are not divided, each man himself manufacturing all the articles he consumes. Supposing each individual to labour during ten hours daily, one of which is devoted to making shoes, it is evident that if any tool or machine be introduced, by the use ofwhich his shoes can be made in halfthe usual time, then each member ofthe community will enjoy the same comforts as before by only nine and one-half hours' labour.

405. If, therefore, we wish to prove that the total quantity oflabourisnot diminished by the introduction of machines, we must have recourse to some other principle of our nature. But the same motive which urges a man to activity will become additionally powerful, when he finds his comforts procured with diminished labour; and in such circumstances, it is probable, that many would employ the time thus redeemed in contriving new tools for other branches of their occupations. He who has habitually worked ten hours a day, will employ the half hour saved by the new machine in gratifying some other want; and as each new machine adds to these gratifications, new luxuries will open to his view, which continued enjoyment will as surely render necessary to his happiness.

406. In countries where occupations are divided, and where the division of labour is practised, the ultimate consequence of improvements in machinery is almost invariably to cause a greater demand for labour. Frequently the new labour requires, at its commencement, a higher degree of skill than the old; and, unfortunately, the class of persons driven out of the old employment are not always qualified for the new one; so that a certain interval must elapse before the whole of their labour is wanted. This, for a time, produces considerable suffering amongst the working classes; and it is of great importance for their happiness that they should be aware of these effects, and be enabled to foresee them at an early period, in order to diminish, as much as possible, the injury resulting from them.

407. One very important enquiry which this subject presents is the question whether it is more for the interest of the working classes, that improved machinery should be so perfect as to defy the competition of hand labour; and that they should thus be at once driven out of the trade by it; or be gradually forced to quit it by the slow and successive advances of the machine? The suffering which arises from a quick transition is undoubtedly more intense; but it is also much less permanent than that which results from the slower process: and if the competition is perceived to be perfectly hopeless, the workman will at once set himself to learn a new department of his art. On the other hand, although new machinery causes an increased demand for skill in those who make and repair it, and in those who first superintend its use; yet there are other cases in which it enables children and inferior workmen to execute work that previously required greater skill. In such circumstances, even though the increased demand for the article, produced by its diminished price, should speedily give occupation to all who were before employed, yet the very diminution of the skill required, would open a wider field of competition amongst the working classes themselves.

That machines do not, even at their first introduction, invariably throw human labour out of employment, must be admitted; and it has been maintained, by persons very competent to form an opinion on the subject, that they never produce that effect. The solution of this question depends on facts, which, unfortunately, have not yet been collected: and the circumstance of our not possessing the data necessary for the full examination of so important a subject, supplies an additional reason for impressing, upon the minds of all who are interested in such enquiries, the importance of procuring accurate registries, at various times, of the number of persons employed in particular branches of manufacture, of the number of machines used by them. and of the wages they receive.

408. In relation to the enquiry just mentioned, I shall offer some remarks upon the facts within my knowledge; and only regret that those which I can support by numerical statement are so few. When the crushing mill, used in Cornwall and other mining countries, superseded the labour of a great number of young women, who worked very hard in breaking ores with flat hammers, no distress followed. The reason of this appears to have been, that the proprietors of the mines, having one portion of their capital released by the superior cheapness of the process executed by the mills, found it their interest to apply more labour to other operations. The women, disengaged from mere drudgery, were thus profitably employed in dressing the ores, a work which required skill and judgement in the selection.

409. The increased production arising from alterations in the machinery, or from improved modes of using it, appears from the following table. A machine called in the cotton manufacture a 'stretcher', worked by one man, produced as follows:

Year; Pounds of cotton spun; Roving wages per score; Rate of earning per week s. d. s. d.

1810 400 1 31/2 25 10(1*) 1811 600 0 10 25 0 1813 850 0 9 31 101/2 1823 1000 0 71/2 31 3

The same man working at another stretcher, the roving a little finer, produced,

1823 900 0 71/2 28 11/2 1825 1000 0 7 27 6 1827 1200 0 6 30 0 1832 1200 0 6 30 0

In this instance, production has gradually increased until, at the end of twenty-two years, three times as much work is done as at the commencement, although the manual labour employed remains the same. The weekly earnings of the workmen have not fluctuated very much, and appear, on the whole, to have advanced: but it would be imprudent to push too far reasonings founded upon a single instance.

410. The produce of 480 spindles of 'mule yarn spinning', at different periods, was as follows:

Year; Hanks about 40 to the pound; Wages per thousand (s. d.)

1806; 6668; 9 2 1823; 8000; 6 3 1832; 10,000; 3 8

411. The subjoined view of the state of weaving by hand- and by power-looms, at Stockport, in the years 1822 and 1832, is taken from an enumeration of the machines contained in 65 factories, and was collected for the purpose of being given in evidence before a Committee of the House of Commons.

In 1822 In 1832 Hand-loom weavers 2800 800 2000 decrease Persons using power-looms 657 3059 2402 increase Persons to dress the warp 98 388 290 increase Total persons employed 3555 4247 692 increase Power-looms 1970 9177 8207 increase

During this period, the number of hand-looms in employment has diminished to less than one-third, whilst that of power-looms has increased to more than five times its former amount. The total number of workmen has increased about one-third; but the amount of manufactured goods (supposing each power-loom to do only the work of three hand-looms) is three and a half times as large as it was before.

412. In considering this increase of employment, it must be admitted, that the two thousand persons thrown out of work are not exactly of the same class as those called into employment by the power-looms. A hand-weaver must possess bodily strength, which is not essential for a person attending a power-loom; consequently, women and young persons of both sexes, from fifteen to seventeen years of age, find employment in power-loom factories. This, however, would be a very limited view of the employment arising from the introduction of power-looms: the skill called into action in building the new factories, in constructing the new machinery, in making the steam-engines to drive it, and in devising improvements in the structure of the looms, as well as in regulating the economy of the establishment, is of a much higher order than that which it had assisted in superseding; and if we possessed any means of measuring this, it would probably be found larger in amount. Nor, in this view of the subject, must we omit the fact, that although hand-looms would have increased in number if those moved by steam had not been invented, yet it is the cheapness of the article manufactured by power-looms which has caused this great extension of their employment, and that by diminishing the price of one article of commerce, we always call into additional activity the energy of those who produce others. It appears that the number of hand-looms in use in England and Scotland in 1830, was about 240,000; nearly the same number existed in the year 1820: whereas the number of power-looms which, in 1830, was 55,000, had, in 1820, been 14,000. When it is considered that each of these powerlooms did as much work as three worked by hand, the increased producing power was equal to that of 123,000 hand-looms. During the whole of this period the wages and employment of hand-loom weavers have been very precarious.

413. Increased intelligence amongst the working classes, may enable them to foresee some of those improvements which are likely for a time to affect the value of their labour; and the assistance of savings banks and friendly societies, (the advantages of which can never be too frequently, or too strongly, pressed upon their attention), may be of some avail in remedying the evil: but it may be useful also to suggest to them, that a diversity of employments amongst the members of one family will tend, in some measure, to mitigate the privations which arise from fluctuation in the value of labour.

NOTES:

1. In 1810, the workman's wages were guaranteed not to be less than 26s.



Chapter 33

On the Effect of Taxes and of Legal Restrictions upon Manufactures

414. As soon as a tax is put upon any article, the ingenuity of those who make, and of those who use it, is directed to the means of evading as large a part of the tax as they can; and this may often be accomplished in ways which are perfectly fair and legal. An excise duty exists at present of 3d.(1*) per pound upon all writing paper. The effect of this impost is, that much of the paper which is employed, is made extremely thin, in order that the weight of a given number of sheets may be as small as possible. Soon after the first imposition of the tax upon windows, which depended upon their number, and not upon their size, new-built houses began to have fewer windows and those of larger dimensions than before. Staircases were lighted by extremely long windows, illuminating three or four flights of stairs. When the tax was increased, and the size of windows charged as single was limited, then still greater care was taken to have as few windows as possible, and internal lights became frequent. These internal lights in their turn became the subject of taxation; but it was easy to evade the discovery of them, and in the last Act of Parliament reducing the assessed taxes, they ceased to be chargeable. From the changes thus successively introduced in the number the forms, and the positions of the windows, a tolerable conjecture might, in some instances, be formed of the age of a house.

415. A tax on windows is exposed to objection on the double ground of its excluding air and light, and it is on both accounts injurious to health. The importance of light to the enjoyment of health is not perhaps sufficiently appreciated: in the cold and more variable climates, it is of still greater importance than in warmer countries.

416. The effects of regulations of excise upon our home manufactures are often productive of great inconvenience; and check, materially, the natural progress of improvement. It is frequently necessary, for the purposes of revenue, to oblige manufacturers to take out a license, and to compel them to work according to certain rules, and to make certain stated quantities at each operation. When these quantities are large, as in general they are, they deter manufacturers from making experiments, and thus impede improvements both in the mode of conducting the processes and in the introduction of new materials. Difficulties of this nature have occurred in experimenting upon glass for optical purposes; but in this case, permission has been obtained by fit persons to make experiments, without the interference of the excise. It ought, however, to be remembered, that such permission, if frequently or indiscriminately granted, might be abused: the greatest protection against such an abuse will be found, in bringing the force of public opinion to bear upon scientific men and thus enabling the proper authorities, although themselves but moderately conversant with science, to judge of the propriety of the permission, from the public character of the applicant.

417. From the evidence given, in 1808, before the Committee of the House of Commons, On Distillation from Sugar and Molasses, it appeared that, by a different mode of working from that prescribed by the Excise, the spirits from a given weight of corn, which then produced eighteen gallons, might easily have been increased to twenty gallons. Nothing more is required for this purpose, than to make what is called the wash weaker, the consequence of which is, that fermentation goes on to a greater extent. It was stated, however, that such a deviation would render the collection of the duty liable to great difficulties; and that it would not benefit the distiller much, since his price was enhanced to the customer by any increase of expense in the fabrication. Here then is a case in which a quantity, amounting to one-ninth of the total produce, is actually lost to the country. A similar effect arises in the coal trade, from the effect of a duty, for, according to the evidence before the House of Commons, it appears that a considerable quantity of the very best coal is actually wasted. The extent of this waste is very various in different mines; but in some cases it amounts to one-third.

418. The effects of duties upon the import of foreign manufactures are equally curious. A singular instance occurred in the United States, where bar-iron was, on its introduction. liable to a duty of 140 per cent ad valorem, whilst hardware was charged at 25 per cent only. In consequence of this tax, large quantities of malleable iron rails for railroads were imported into America under the denomination of hardware; the difference of 115 per cent in duty more than counter balancing the expense of fashioning the iron into rails prior to its importation.

419. Duties, drawbacks, and bounties, when considerable in amount, are all liable to objections of a very serious nature, from the frauds to which they give rise. It has been stated before Committees of the House of Commons, that calicoes made up in the form, and with the appearance of linen, have frequently been exported for the purpose of obtaining the bounty, for calico made up in this way sells only at 1s. 4d. per yard, whereas linen of equal fineness is worth from 2s. 8d. to 2s. 10d. per yard. It appeared from the evidence, that one house in six months sold five hundred such pieces of calico.

In almost all cases heavy duties, or prohibitions, are ineffective as well as injurious; for unless the articles excluded are of very large dimensions, there constantly arises a price at which they will be clandestinely imported by the smuggler. The extent, therefore, to which smuggling can be carried, should always be considered in the imposition of new duties, or in the alteration of old ones. Unfortunately it has been pushed so far, and is so systematically conducted between this country and France, that the price per cent at which most contraband articles can be procured is perfectly well known. From the evidence of Mr Galloway, it appears that, from 30 to 40 per cent was the rate of insurance on exporting prohibited machinery from England, and that the larger the quantity the less was the percentage demanded. From evidence given in the Report of the Watch and Clock-makers' Committee, in 1817, it appears that persons were constantly in the habit of receiving in France watches, lace, silks, and other articles of value easily portable, and delivering them in England at ten per cent on their estimated worth, in which sum the cost of transport and the risk of smuggling were included.

420. The process employed in manufacturing often depends upon the mode in which a tax is levied on the materials, or on the article produced. W atch glasses are made in England by workmen who purchase from the glass house globes of five or six inches in diameter, out of which, by means of a piece of red-hot tobacco pipe, guided round a pattern watch glass placed on the globe, they crack five others: these are afterwards ground and smoothed on the edges. In the Tyrol the rough watch glasses are supplied at once from the glass house; the workman, applying a thick ring of cold glass to each globe as soon as it is blown, causes a piece, of the size of a watch glass, to be cracked out. The remaining portion of the globe is immediately broken, and returns to the melting pot. This process could not be adopted in England with the same economy, because the whole of the glass taken out of the pot is subject to the excise duty.

421. The objections thus stated as incidental to particular modes of taxation are not raised with a view to the removal of those particular taxes; their fitness or unfitness must be decided by a much wider enquiry, into which it is not the object of this volume to enter. Taxes are essential for the security both of liberty and property, and the evils which have been mentioned may be the least amongst those which might have been chosen. It is, however, important that the various effects of every tax should be studied, and that those should be adopted which, upon the whole, are found to give the least check to the productive industry of the country.

422. In enquiring into the effect produced, or to be apprehended from any particular mode of taxation, it is necessary to examine a little into the interests of the parties who approve of the plan in question, as well as of those who object to it. Instances have occurred where the persons paying a tax into the hands of government have themselves been adverse to any reduction. This happened in the case of one class of calico-printers, whose interest really was injured by a removal of the tax on the printing: they received from the manufacturers, payment for the duty, about two months before they were themselves called on to pay it to government; and the consequence was, that a considerable capital always remained in their hands. The evidence which states this circumstance is well calculated to promote a reasonable circumspection in such enquiries.

Question. Do you happen to know anything of an opposition from calicoprinters to the repeal of the tax on printed calicoes?

Answer. I have certainly heard of such an opposition, and am not surprised at it. There are very few individuals who are, in fact, interested in the nonrepeal of the tax; there are two classes of calico-printers; one, who print their own cloth, send their goods into the market, and sell them on their own account; they frequently advance the duty to government, and pay it in cash before their goods are sold, but generally before the goods are paid for, being most commonly sold on a credit of six months: they are of course interested on that account, as well as on others that have been stated, in the repeal of the tax. The other class of calico-printers print the cloth of other people; they print for hire, and on re-delivery of the cloth when printed, they receive the amount of the duty, which they are not called upon to pay to government sooner, on an average, than nine weeks from the stamping of the goods. Where the business is carried on upon a large scale, the arrears of duty due to government often amount to eight, or even ten thousand pounds, and furnish a capital with which these gentlemen carry on their business; it is not, therefore, to be wondered at that they should be opposed to the prayer of our petition.

423. The policy of giving bounties upon home productions, and of enforcing restrictions against those which can be produced more cheaply in other countries, is of a very questionable nature: and, except for the purpose of introducing a new manufacture, in a country where there is not much commercial or manufacturing spirit, is scarcely to be defended. All incidental modes of taxing one class of the community, the consumers, to an unknown extent, for the sake of supporting another class, the manufacturers, who would otherwise abandon that mode of employing their capital, are highly objectionable. One part of the price of any article produced under such circumstances, consists of the expenditure, together with the ordinary profits of capital: the other part of its price may be looked upon as charity, given to induce the manufacturer to continue an unprofitable use of his capital, in order to give employment to his workmen. If the sum of what the consumers are thus forced to pay, merely on account of these artificial restrictions, where generally known, its amount would astonish even those who advocate them; and it would be evident to both parties, that the employment of capital in those branches of trade ought to be abandoned.

424. The restriction of articles produced in a manufactory to certain sizes, is attended with some good effect in an economical view, arising chiefly from the smaller number of different tools required in making them, as well as from less frequent change in the adjustment of those tools. A similar source of economy is employed in the Navy: by having ships divided into a certain number of classes, each of which comprises vessels of the same dimensions, the rigging made for one vessel will fit any other of its class; a circumstance which renders the supply of distant stations more easy.

425. The effects of the removal of a monopoly are often very important, and they were perhaps never more remarkable than in the bobbin net trade, in the years 1824 and 1825. These effects were, however, considerably enhanced by the general rage for speculation which was so prevalent during that singular period. One of the patents of Mr Heathcote for a bobbin net machine had just then expired, whilst another, for an improvement in a particular part of such machines, called a turn again, had yet a few years to run. Many licenses had been granted to use the former patent, which were charged at the rate of about five pounds per annum for each quarter of a yard in width, so that what is termed a six-quarter frame (which makes bobbin net a yard and a half wide) paid thirty pounds a year. The second patent was ultimately abandoned in August, 1823, infringements of it having taken place.

It was not surprising that, on the removal of the monopoly arising from this patent, a multitude of persons became desirous of embarking in a trade which had hitherto yielded a very large profit. The bobbin net machine occupies little space; and is, from that circumstance, well adapted for a domestic manufacture. The machines which already existed, were principally in the hands of the manufacturers; but, a kind of mania for obtaining them seized on persons of all descriptions, who could raise a small capital; and, under its influence, butchers, bakers, small farmers, publicans, gentlemen's servants, and, in some cases, even clergymen, became anxious to possess bobbin net machines.

Some few machines were rented; but, in most of these cases, the workman purchased the machine he employed, by instalments of from L3 to L6 weekly, for a six quarter machine; and many individuals, unacquainted with the mode of using the machines so purchased, paid others of more experience for instructing them in their use; L50 or L60 being sometimes given for this instruction. The success of the first speculators induced others to follow the example; and the machine-makers were almost overwhelmed with orders for lace frames. Such was the desire to procure them, that many persons deposited a large part, or the whole, of the price, in the hands of the frame-makers, in order to insure their having the earliest supply. This, as might naturally be expected, raised the price of wages amongst the workmen employed in machine-making; and the effect was felt at a considerable distance from Nottingham, which was the centre of this mania. Smiths not used to flat filing, coming from distant parts, earned from 30s. to 42s. per week. Finishing smiths, accustomed to the work, gained from L3 to L4 per week..The forging smith, if accustomed to his work, gained from L5 to L6 per week, and some few earned L10 per week. In making what are technically called insides, those who were best paid, were generally clock- and watchmakers, from all the districts round, who received from L3 to L4 per week. The setters-up—persons who put the parts of the machine together—charged L20 for their assistance; and, a six quarter machine, could be put together in a fortnight or three weeks.

426. Good workmen, being thus induced to desert less profitable branches of their business, in order to supply this extraordinary demand, the masters, in other trades, soon found their men leaving them, without being aware of the immediate reason: some of the more intelligent, however, ascertained the cause. They went from Birmingham to Nottingham, in order to examine into the circumstances which had seduced almost all the journeymen clockmakers from their own workshops; and it was soon apparent, that the men who had been working as clockmakers in Birmingham, at the rate of 25s. a week, could earn L2 by working at lace frame-making in Nottingham.

On examining the nature of this profitable work, the master clockmakers perceived that one part of the bobbin net machines, that which held the bobbins, could easily be made in their own workshops. They therefore contracted with the machine-makers, who had already more work ordered than they could execute, to supply the bobbin carriers, at a price which enabled them, on their return home, to give such increased wages as were sufficient to retain their own workmen, as well as yield themselves a good profit. Thus an additional facility was afforded for the construction of these bobbin net machines: and the conclusion was not difficult to be foreseen. The immense supply of bobbin net thus poured into the market, speedily reduced its price; this reduction in price, rendered the machines by which the net was made, less valuable; some few of the earliest producers, for a short time, carried on a profitable trade; but multitudes were disappointed, and many ruined. The low price at which the fabric sold, together with its lightness and beauty, combined to extend the sale; and ultimately, new improvements in the machines, rendered the older ones still less valuable.

427. The bobbin net trade is, at present, both extensive and increasing; and, as it may, probably, claim a larger portion of public attention at some future time, it will be interesting to describe briefly its actual state.

A lace frame on the most improved principle, at the present day, manufacturing a piece of net two yards wide, when worked night and day, will produce six hundred and twenty racks per week. A rack is two hundred and forty holes; and as in the machine to which we refer, three racks are equal in length to one yard, it will produce 21,493 square yards of bobbin net annually. Three men keep this machine constantly working; and, they were paid (by piece-work) about 25s. each per week, in 1830. Two boys, working only in the day-time, can prepare the bobbins for this machine, and are paid from 2s. to 4s. per week, according to their skill. Forty-six square yards of this net weigh two pounds three ounces; so that each square yard weighs a little more than three-quarters of an ounce.

428. For a condensed and general view of the present state of this trade, we shall avail ourselves of a statement by Mr William Felkin, of Nottingham, dated September, 1831, and entitled Facts and Calculations illustrative of the Present State of the Bobbin Net Trade. It appears to have been collected with care, and contains, in a single sheet of paper, a body of facts of the greatest importance. *

429. The total capital employed in the factories, for preparing the cotton, in those for weaving the bobbin net, and in various processes to which it is subject, is estimated at above L2,000,000, and the number of persons who receive wages, at above two hundred thousand.

Comparison of the value of the raw material imported, with the value of the goods manufactured therefrom

Amount of Sea Island cotton annually used 1,600,000 lbs., value L120,000; this is manufactured into yarn, weighing 1,000,000 lbs., value L500,000.

There is also used 25,000 lbs. of raw silk, which costs L30,000, and is doubled into 10,000 lbs. thrown, worth L40,000.

Raw Material; Manufacture; Square yards produced; Value per sq. yd.(s. d.); Total value (L)

Cotton 1,600,000; lbs; Power Net; 6,750,000; 1 3; 421,875 Hand ditto; 15,750,000; 1 9; 1,378,125 Fancy ditto; 150,000; 3 6; 26,250 Silk, 25,000 lbs; Silk Goods; 750,000; 1 9; 65,625

23,400,000; 1,891,875

* I cannot omit the opportunity of expressing my hope that this example will be followed in other trades. We should thus obtain a body ofinformation equally important to the workman, the capitalist, the philosopher, and the statesman.

The brown nets which are sold in the Nottingham market are in part disposed of by the agents of twelve or fifteen of the larger makers, i.e. to the amount of about L250,000 a year. The principal part of the remainder, i.e. about L1,050,000 a year, is sold by about two hundred agents, who take the goods from one warehouse to another for sale.

Of this production, about half is exported in the unembroidered state. The exports of bobbin net are in great part to Hamburgh, for sale at home and at Leipzic and Frankfort fairs. Antwerp, and the rest of Belgium; to France, by contraband; to Italy, and North and South America. Though a very suitable article, yet the quantity sent eastward of the Cape of Good Hope, has hitherto been too trifling for notice. Three-eighths of the whole production are sold unembroidered at home. The remaining one-eighth is embroidered in this country, and increases the ultimate value as under, viz.

Embroidery Increases value Ultimate worth L L On power net 131,840 553,715 On hand net 1,205,860 2,583.985 On fancy net 78,750 105,000 On silk net 109,375 175,000

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