The Online Library of Liberty

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• Political Economy
• Part I.: Character and Logical Method of Political Economy.
• Part II.: Production.
• Chapter I.: Land and Natural Agents.
• Chapter II.: Labor.
• Chapter III.: Capital: Its Origin and Office.
• Chapter IV.: The Productive Capability of a Community.
• Part III.: Exchange.
• Chapter I.: The Theory of Value.
• Chapter II.: The Theory of International Exchanges.
• Chapter III.: Money and Its Value.
• Chapter IV.: Money and Its Value—continued—debased Coin: Seigniorage.
• Chapter V.: Inconvertible Paper Money.
• Chapter VI.: Bank Money.
• Chapter VII.: The Reaction of Exchange Upon Production.
• Part IV.: Distribution.
• Chapter I.: The Parties to the Distribution of Wealth.
• Chapter II.: Rent.
• Chapter III.: Interest.
• Chapter IV.: Profits.
• Chapter V.: Wages.
• Chapter VI.: Wages.—continued.
• Chapter VII.: Two Other Shares In Distribution.
• Chapter VIII.: The Reaction of Distribution Upon Production.
• Part V.: Consumption.
• Chapter I.: Subsistence: Population.
• Chapter II.: The Appearance of New Economic Wants.
• Chapter III.: Consumption: the Dynamics of Wealth.
• Part VI.: Some Applications of Economic Principles.
• I.: Usury Laws.
• II.: Industrial Co-operation.
• III.: Political Money.
• IV.: Pauperism.
• V.: The Doctrine of the Wage-fund.
• VI.: The Multiple Or Tabular Standard of Deferred Payments.
• VII.: Trade Unions and Strikes.
• VIII.: The Knights of Labor.
• IX.: Attacks On the Doctrine of Rent.
• X.: The Nationalization of the Land.
• XI.: The Banking Functions.
• XII.: The Present Banking System of the United States.
• XIII.: Foreign Exchanges.
• XIV.: Bi-metallism.
• XV.: The Revenue of the State.
• XVI.: The Principles of Taxation.
• XVII.: Protection Vs. Freedom of Production.
• XVIII.: Socialism.

IV.

pauperism.

446. The Impotent vs. the Able-Bodied Poor.—The relief of the impotent poor, whether by private or by public charity, is, so far as political economy is concerned with it, a question relating to the consumption of wealth. It is so much a matter of course, under our modern civilization, that the very young and the very old, the crippled and deformed, who are unable to earn their own maintenance, shall not be allowed to starve, that the matter of relief to these classes becomes one of administrative detail, that does not require even to be alluded to in an elementary treatise on economics. The experience of that country from which we derive our law and much of our administrative machinery, is, however, so instructive as to the influence for mischief upon the entire laboring population and upon the future production of wealth, that may be wrought by ill considered provisions for the distribution of alms to the able-bodied poor, as to make it worth while briefly to recite that experience here; and thereupon to define the limits outside which the consumption of wealth for this purpose becomes prejudicial.

We shall get at our subject most directly by inquiring, why is it that the laborer works at all. Clearly that he may eat. If he may eat without it, he will not work. The neglect or contempt of this very obvious truth by the British Parliament, during the latter part of the eighteenth and the early part of the nineteenth century, brought the working classes of the kingdom almost to the verge of ruin, created a vast body of hopeless and hereditary pauperism, and engendered vices in the industrial system which have been productive of evil down to the present day.

447. Establishment of the English Pauper System.—By statute of the 27th year of Henry VIII., the giving of alms was prohibited, and collections for the impotent poor were required to be made in each parish. By 1st Edward VI., bishops were authorized to proceed at law against persons who should refuse to contribute for this purpose, or should dissuade others from contributing. By 5th Elizabeth, Justices of the Peace were made judges of what constituted a reasonable contribution. By 14th Elizabeth, regular compulsory contributions were exacted. But the act of 43d Elizabeth created the permanent pauper system of England.

The increasing necessity for legal provisions for the poor, during the period covered by this recital, is attributed by judicious writers, first, to the destruction of the abbeys and monasteries, which had, in earlier times, disbursed vast revenues in charity; and, secondly, to the effects of the flood of new silver from the mines of Spanish America, which, by rapidly raising prices and thus reducing the purchasing power of fixed incomes, had caused large numbers to be thrown out of employment.

By the act of 43d Elizabeth, every person in the kingdom was given a legal right to public relief, if required; but voluntary pauperism was severely dealt with, and the able-bodied were compelled to work. At first, the body of inhabitants were to be taxed for the objects of this statute; but subsequent legislation threw the burden entirely upon the landowners, where it remains to this day, with the exception that partial grants are now made out of the Imperial revenues to meet the charges of maintaining certain classes of paupers, such as the insane.

448. Removal of the Workhouse Test.—The principle of requiring the able-bodied poor to work continued for generations to be fundamental in the English pauper system; and for the better enforcement of this requisition parishes or unions of parishes were, by an act of 9th George I., authorized to build workhouses, residence in which might be made a condition of relief. Moreover, from the days of Elizabeth to that of George III., the spirit which actuated the administration of the poor laws was jealous and severe. Doubtless in that administration unnecessary harshness was sometimes practiced; but, on the whole, the effect on the working classes was wholesome, for it was made undesirable to become a pauper.

On the accession of George III., a different theory came to direct legislation relating to poor relief, and a widely different temper of administration began to prevail. Six successive acts, passed in the first years of that reign, intimated the changed spirit in which pauperism was thereafter to be dealt with. In the 22nd year of George III., the act known as Gilbert's act gave a fuller expression to this spirit. By that act the workhouse was no longer to be used as a test of voluntary pauperism: the 29th section provided that “no person shall be sent to such poor-house except such as are become indigent by old age, sickness or infirmities, and are unable to acquire a maintenance by their labor; except such orphan children as shall be sent thither by order of the guardian or guardians of the poor, with the approbation of the visitor, and except such children as shall necessarily go with their mothers thither for sustenance.”

With respect to the rest of the poor, the act by its 32d section provided “That where there shall be in any parish, township or place, any poor person or persons, who shall be able and willing to work but who can not get employment, the guardian of the poor of such parish, etc., on application made to him by or on behalf of such poor person, is required to agree for the labor of such poor person or persons at any work or employment suited to his or her strength and capacity, in any parish or place near the place of his or her residence, and to maintain, or cause such person or persons to be properly maintained, lodged and provided for, until such employment shall be procured, and during the time of such work, and to receive the money to be earned by such work or labor, and apply it in such maintenance as far as the same will go, and make up the deficiency, if any.”

By the repeal of the workhouse test, and by the additional most injudicious provision which we have placed in italics, a deadly blow was struck at the manhood and industrial selfsufficiency of the working classes of England.

449. “The act,” says Sir George Nicholls, in his History of the English Poor Law, “appears to assume that there can never be a lack of profitable employment, and it makes the guardian of the parish answerable for finding it near the laborer's own residence, where, if it existed at all, the laborer might surely, by due diligence, find it himself. But why, it may be asked, should he use such diligence when the guardian is bound to find it for him, and take the whole responsibility of bargaining for wages and making up to him all deficiency? He is certain of employment. He is certain of receiving, either from the parish or his employer, sufficient for the maintenance of himself and his family; and if he earns a surplus, he is certain of its being paid over to him. There may be uncertainty with others, and in other occupations. The farmer, the lawyer, the merchant, the manufacturer, however industrious and observant, may labor under uncertainties in their several callings; not so the laborer. He bears, as it were, a charmed life in this respect, and is made secure, and that, too, without the exercise of care or forethought. Could a more certain way be devised for lowering character, destroying self-reliance, and discouraging, if not absolutely preventing, improvement?”

450. The Logical Outcome.—By 1832 the false and vicious principle on which Gilbert's act was based had been carried logically out to its limits in almost universal pauperism. The condition of the person who threw himself flat upon public charity was better than that of the laborer who struggled on to preserve his manhood in self-support. The commissioners appointed in that year to investigate the workings of the poor law, found that, where the independent laborer was able to earn by his week's work but 122 ounces of solid food, the pauper had 151 ounces given him in idleness. The former had only to abandon his effort to provide for himself, to be better provided for than was possible through his own exertions. The drone was better clothed, better lodged and better fed than the worker.

All the incidents of this bad system were unnecessarily bad. The allowance for each additional child was so much out of proportion to the allowance for adults, that the more numerous a man's children the better his condition, and thus the rapid increase of an already pauperized population was encouraged. Moreover, the allowance in the case of illegitimate children was even greater than for those born in wedlock. The British Parliament had turned itself into a society for the promotion of vice. “The English law,” said Commissioner Cowell, in his report, “has abolished female chastity.” “In many rural districts,” writes Miss Martineau in her History of the Peace, “it was scarcely possible to meet a young woman who was respectable, so tempting was the parish allowance for infants in a time of great pressure.” “It may safely be affirmed,” said the Poor Law Commissioners of 1831, “that the virtue of female chastity does not exist among the lower orders of England, except to a certain degree among domestic servants, who know that they hold their situations by that tenure and are more prudent in consequence.”

Such may be the effects of foolish laws. The legislator may think it hard that his power for good is so closely restricted; but he has no reason to complain of any limits upon his power for evil. On the contrary, it would seem that there is no race of men, whom a few laws respecting industry, trade and finance, passed by country squires or labor demagogues, in defiance of economic principles, could not in half a generation transform into beasts.

451. Poor Law Reform.—We have seen what a system the English squirearchy substituted for the economic law that he that would eat must work. The natural effects of this system were wrought speedily and effectually. The disposition to labor was cut up by the roots; all restraints upon increase of population disappeared under a premium upon births; selfrespect and social decency vanished before a money-premium on bastardy. The amount expended in the relief and maintenance of the poor rose to enormous and even ruinous sums. In some instances landowners relinquished their estates in order to escape the monstrous rates levied upon them, in support of local paupers.

In this exigency, which, in truth, constituted one of the gravest crises of English history, Parliament, by the Poor Law Amendment Act (4th and 5th, William IV.) returned to the principle of the act of Elizabeth. The workhouse test was restored; allowances in aid of wages were abolished; paid overseers were appointed, and a central system was created for the due supervision of the system. Illegitimacy was discouraged by punishing the father, instead of rewarding the mother; and the law of pauper settlement∗ was modified so as to facilitate the migration of laborers in search of employment.

By this great legislative reform the burden of pauperism, in spite of the continuing effects of the old evil system, was reduced in three years, by an average amount, the kingdom over, of forty-five per cent.

452. The Principle that Should Govern Poor Relief.—The moral of this episode in the industrial history of England is easily drawn. It is of the highest consequence that pauperism shall not be made inviting; that, on the contrary, the laborer shall be stimulated to the utmost possible exertions to achieve self-support, only accepting relief as an alternative to actual starvation. It is not, to this end, necessary that any brutality of administration shall deter the worthy poor who have no other recourse; but, it should be the prime object of legislation to make the situation of the pauper less agreeable than that of the independent laborer, and that, by no small interval. The workhouse test for all the able-bodied poor, and genuine hard work, up to the limit of strength, are imperatively demanded by the interests of productive labor. Wherever there is a possible choice between self-support and public support, the inclination to labor for one's own subsistence should be quickened by something of a penalty upon the pauper condition, though not in the way of cruelty or positive privation. “All,” says Mr. Geo. W. Hastings, “who have administered the Poor Law must know the fatal readiness with which those hovering on the brink of pauperism believe that they can not earn a living, and the marvelous way in which, if the test be firmly applied, the means of subsistence will be found somehow.”

[∗]The law of parochial settlement was enacted in the reign of Charles II. While other restrictions upon the movements of population gradually gave way, during the two centuries following, before the expansion of industrial enterprise and the liberalizing tendencies of modern thought, the mischievous tendencies of the Law of Settlement were given a wider scope and an increased severity, from reign to reign. Migration within the Kingdom was practically prohibited. If the laborer, in search of employment crossed the boundaries of that one of the fifteen thousand parishes of England in which he belonged, he was liable to be apprehended and returned to the place of his settlement. Parish officers were perpetually incited by the fears of the rate-payers to the utmost zeal in hunting down and running out all possible claimants for public charity, on whom, if unmolested, residence would confer a right to support. “Where,” says Prof. Rogers, “an employer wished to engage a servant from a foreign parish, he was not permitted to do so unless he entered into a recognizance, often to a considerable amount, to the effect that the new-comer should not obtain a settlement, else the bond to be good against the employer. Parochial registers are full of such acknowledgments.”