Doubts and Difficulties: The Wealth of the Wealthless Workers. (1905)

The Doubts and Difficulties column from the June 1905 issue of the Socialist Standard

The Wealth of the Wealthless Workers.

A correspondent writes: “I am very pleased to welcome your new venture in opening a Doubts and Difficulties section in the Socialist Standard. I think that the ventilation of all difficulties in the way of a full acception of Socialism and Socialist principles is of the greatest educational utility, and that this section of the Socialist Standard deserves the support of all Socialists. With the experience gained in this way the answers will tend to become less crudely expressed and will prove doubtless a valuable contribution to the education of our propagandists.”

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I thank my correspondent for his appreciation and may assure him that I am keenly alive to the imperfection of my methods of expression. The Board School education which most of us workers have received does not lend itself to the building up of a graceful literary style. At the same time a knowledge of working-class life and an understanding of its inner meaning is forced upon us as we live and work amongst our fellows. And if experience of the bitterness and misery engendered by the grinding poverty of the every-day life of the working-class is of any advantage in understanding the condition of the wage worker I think I am so far equipped for my present task.

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Another correspondent has set me the following conundrum: “In your ‘Doubts and Difficulties’ in the May Standard you say that the spinner enters the labour market possessed of only his labour-power which he is compelled to sell so as to secure his means of livelihood. Is this so ? Does not the spinner—the working-class—own a considerable amount of wealth in Savings Banks, Friendly Societies, and Trade Unions, and does not this fact vitiate your entire argument? ”

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I think we shall find that the contention in the above argument is not a sound one and that it is in fact one of the stock arguments of the apologist of the capitalist regime in favour of the present system. When the Socialist points out that thrift is impossible for the worker because his wages are determined by the average cost of his subsistence we are told that he has been thrifty as is shown by the Savings Bank deposits and that as he has been thrifty and has been able to save some of his wages they must have been more than the cost of his subsistence and that the Socialist position was therefore futile and absurd.

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The first fallacy which is made in reckoning up those “savings of the working classes” is to count in several huge sums twice over. We are told grandiloquently of the £198,000,000 in the Post Office and Trustee Savings Banks and of the £45,000,000 deposited with Friendly Societies, forgetting that special provision is made by the Post Office Savings Bank for the receiving of the funds of Friendly Societies and Trades Unions. But we do not desire to press this point. We can afford—such is the strength of our case—to take the highest possible estimate and assume that these deposits aggregate £300,000,000.

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The question which now arises is : Who has deposited this £300,000,000? The capitalist apologists of the press, the platform, and the pulpit assume that it is wholly the savings of members of the working-class. We contend that such an assumption is a grotesque fallacy.

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Let us ask ourselves another question. Where do the small shopkeeper, the small trader, the less successful professional and business men deposit their money, and where do the children of these classes and even of the richer middle-class keep their savings ?

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I do not think that it can be in the ordinary bank—whether private or joint-stock—inasmuch as they refuse to carry on their business except for the profit of the banker and that profit cannot be derived from a banking account unless a minimum balance is guaranteed. In small credit banks an average of say £50 would be required, while larger banks require considerably higher balances to be maintained.

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It is not possible for the working-class to have accounts with these banks and neither is it possible for the average small trader to do so. As far as possible he requires his money to be in circulation. He uses it to replenish his stock—to increase the quantity of his goods available for turnover. At the same time the whole of his money cannot be tied up in this way. He buys on credit and has to meet his bills when they fall due and he has to save his money for the purpose. The ordinary bank not being convenient for his purpose he avails himself of the facilities afforded by the Post Office Savings Bank.

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So with his children. They use the Savings Bank to put away the pennies and shillings they save from the sweet-stuff shop and often have accounts which aggregate to more than the yearly earnings of the working man.

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As to the proportion of the deposits which belong to working men, I may mention the result of an investigation made into this question in the United States of America by Lucien Saniel. His conclusion was that 10 per cent. would more than cover the share invested by the working-class of that country.

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In America we are informed by the Reports of the Commissioner of Labour of the United States, the average wage is 30 per cent. higher than in the United Kingdom, and we should consequently expect that the savings of the working-class there were higher in proportion than of the working-class in this country. But even taking it that the working-class here own 10 per cent. of the high estimated savings given above, the result would be £20,000,000 as representing the savings of the working-class.

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I am informed further that many of these deposits are very temporary in their nature. The wage deposited on Saturday afternoon is often withdrawn the following Thursday, and the working-class in the large towns deposit in the Savings Bank to meet the contingency of rent, holiday, or even more interesting domestic occurrences.

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This, however, only refers to the better paid mechanic who has a wage somewhat higher than the working-class average and can sometimes afford a holiday. Taking all the facts, I think we must take it as fully borne out that the working-class as a class are never more than a few weeks from starvation and that as a class they own nothing beyond their labour-power—their power to perform work.

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While the better class mechanic getting a relatively higher wage because he has somewhat reduced the number of similarly situated mechanics competing for employment can save against a rainy day that never fails to come, the ordinary worker is getting less than the average cost of his subsistence and can save nothing.

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Take the case of the worker of Ridgmount as depicted by our Comrade R. H. Kent in a recent issue of the Socialist Standard. Any saving made by those workers can only be at the expense of the necessities of their wives and children. Individuals may of course save if they remain single, but marriage soon uses up the savings and reduces such individuals to the dead level of a starvation existence.

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When we are informed that 43 per cent. of the working-class population of York are living in poverty we are interested to know how the standard of poverty is understood and Mr. Rowntree is kind enough to inform us.

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He says : “It is thus seen that the wages paid for unskilled labour in York are insufficient to provide food, shelter and clothing adequate to maintain a family of moderate size in a state of bare physical efficiency. It will be remembered that the above estimate of necessary minimum expenditure is based upon the assumption that the diet is even less generous than that allowed to able-bodied paupers in the York Workhouse, and that no allowance is made for any expenditure other than that absolutely required for the maintenance of merely physical efficiency.”

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“And let us clearly understand what ‘merely physical efficiency’ means. A family living upon the scale allowed for in this estimate must never spend a penny on railway fare or omnibus. They must never go into the country unless they walk. They must never purchase a halfpenny newspaper or spend a penny to buy a ticket for a popular concert. They must write no letters to absent children, for they cannot afford to pay the postage. They must never contribute anything to their church or chapel, or give any help to a neighbour which costs them money. They cannot save, neither can they join Sick Club or Trade Union, because they cannot pay the necessary subscriptions. The children must have no pocket money for dolls, marbles, or sweets. The father must smoke no tobacco and must drink no beer. The mother must never buy pretty clothes for herself or for her children, the character of the family wardrobe as of the family diet being governed by the regulation. Nothing must be bought but that which is absolutely necessary for the maintenance of physical health, and what is bought must be of the plainest and most economical description. Should a child fall ill it must be attended by the Parish doctor; should it die it must be buried by the Parish. Finally, the wage earner must never be absent from his work for a single day.”

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“If any of these conditions are broken, the extra expenditure involved is met, and can only be met, by limiting the diet; or in other words by sacrificing physical efficiency.”

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“That few York labourers receiving 20s. or 21s. per week submit to these iron conditions in order to maintain physical efficiency is obvious. And even were they to submit, physical efficiency would be unattainable for those who had three or more children dependent upon them. It cannot, therefore, be too clearly understood, nor too emphatically repeated, that whenever a worker having three children dependent on him, and receiving not more than 21s. 8d. per week, indulges in any expenditure beyond that required for the barest physical needs, he can do so only at the cost of his own physical efficiency, or that of some members of his family.”

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In every case the italics are those of Mr. Rowntree. Under those conditions it would be criminal for any man to try to save, and he must remain possessed only of his power to work. He must sell his power to work, which is himself, in order to live. By thus selling himself he acknowledges himself a slave bound by the will of the master who buys him. The English wage worker is veritably a wage-slave and among them is—

Economicus.

The Question of the Rates. (1905)

From the June 1905 issue of the Socialist Standard

Akin with the rest of the fiscal dodges which the workers are led to take as vital issues, is the present outcry about the rising rates of the Metropolis. And whilst property owners are vehemently condemning municipal extravagance and high rates, we have “gas and water” Socialists coming to their aid by urging the extension of municipal trading, that the rates may be lowered with the profits.

The general question of taxation and the working-class has, it is true, been dealt with in No. 2 of the Socialist Standard, but in view of the fact that there are many under the impression that the workers are interested in keeping rates low, it cannot fail to be useful to treat specially of the rates from a proletarian standpoint.

Now it is often urged that a rise in rates always means a rise in rent. If, however, we look a little closer at this matter we shall soon see how superficial is such a line of reasoning, and that, in reality, the question of the rates does not concern the working-class. In the first place, the idea that the landlord can always compensate himself for a rise in rates or taxes by an increase in rent, rests upon the fallacy that landlords can charge whatever they please. Yet it should be evident that landlords in general always demand as much rent as they can get. That is to say, they demand the full market price of their accommodation. The price land will fetch in any district does not depend upon the will of the landlord, but upon factors outside his control. Now what determines this so-called value of building land ? It may be stated in brief as being regulated by the supply and demand for accommodation. This is in turn determined by the advantages possessed by any plot over land in inconvenient places on which it scarcely pays to build. Once considered, this is self-evident, for if one district has advantages over others, there will be keenest competition for house-room in the favoured district, while the fact that demand exceeds supply will permit the land and house owners to increase the rents until the special advantages of the district are neutralized by the greater cost of accommodation.

To the average person it is of little consequence whether he lives in one district or another ; for although one place may possess advantages, yet the property owners therein, owing to the consequent greater demand for house-room, are enabled to extort proportionately more rent. Thus the landlords get the full benefit of local advantages. If they are asking more than this they are warned by the increase of unoccupied houses : if they are getting less the increasing demand gives them the hint that accommodation can command a greater price, and up goes the rent. If one may make such a comparison, the landlords no more choose their rent than the workers choose their wages. Both get as much as they can, and that limit is determined by conditions outside of their control. The former get the equivalent of the advantages of their sites, regulated by the demand for accommodation, whilst the latter get their cost of subsistence, modified by supply and demand for labour-power.

Where, then, do rates come in? Clearly, higher rates, as such, do not add to the advantages of a district, neither do they increase the demand for accommodation. It is therefore evident that rates do not increase rent. “But,” it is urged, “rent often rises when rates do.” Granted, my friends, but notice that rent more often rises when rates do not. In fact as has already been pointed out in these columns, rent has in several instances declined while rates have risen. But why does rent sometimes rise at the same time that rates go up ? A moment’s reflection will show why. Owing to the continual increase in population and size of towns, the circle of building land is continually extending. This means that as the demand for accommodation grows, less and less convenient, or more distant, sites are built upon. Obviously, then, the land in central and favoured districts is rendered comparatively more valuable by reason of this. Thus there is an increase in the advantages of the favoured districts that is gradual while to meet this rent is raised by little jumps. A change of tenants, an increase in Income Tax or in rates, is seized upon as an excuse for raising the rent. And be it noted that the rise in rent is usually out of all proportion to the pretended reason for the increase. More often, however, rent is raised without any excuse being given other than the fact that the accommodation will fetch more.

The man who farms an entire house is practically in the same position as the lodgers who form so large a percentage of the people. If during the term of his agreement rates rise, the tenant of the house is the immediate sufferer, it is true, but he is only temporarily affected, as we shall see, and in the long run the same facts may be observed if the period of observation be somewhat extended. The property owner in letting his house, gets on the average the full market price for it; and every time he makes a fresh agreement he raises or lowers the rent to meet the demand, or lack of demand, for accommodation. Many householders are in miserable circumstances, in perpetual fear of quarter-day; mere touts for the real landlord, saving him the expenses of rent collecting, house management, etc. When the additional risk, responsibility, work and worry are taken into consideration, many a householder is seen to be in a worse position than his lodgers. It is quite obvious that if rates were abolished in a district, by municipal trading for instance, the people in that district would not thereby be enabled to pay less. The landlords would at the earliest opportunity raise the rent proportionately, and would be able to do this because of the increased demand for houses that would follow such a reduction of the rates.

The question of the rates, then, is of vital concern to the property owners alone. The middle-class cry of saving the rates, or aiding them out of municipal profits, is a dodge to put money into property owners’ pockets. Every effort is being made to lead the workers to believe that they will be better off by reducing the rates, and by this means the workers are hoodwinked into increasing the profits of sections of the capitalist-class. If an improvement follows some municipal expenditure, or a new means of transit is opened, the property near by becomes more valuable, and the capitalist gets the whole benefit by the increased rent or profit he is enabled to obtain. This is observed again and again, and it shows that the term, “value of land” really means that the owner is enabled to extort so much value from others, much the same as a highwayman’s position and arms enable him to rob all who must pass his way.

If in a few cases rising rates are quoted as a reason for raising rent, the excuse is seen to be the merest twaddle from the fact that if there are many apartments to let in a district and rates rise, rents will not go up since there would then be still less chance of obtaining tenants; whilst if the houses let well, and there is competition for house-room, rent will surely go up, whether rates do or not. Workers are misled by narrowness of view and superficial observation, and fail to realize the deeper lying general factors which are of supreme importance. In formulating a general law it is not the exceptional but the representative facts which must be taken into consideration if the law is to be a truth.

The great truth the workers have to heed, amidst the shouting of the rate-saving hucksters, is that so long as the workers must, to get a living, sell their labour-force on the market, as potatoes are sold on the potato market, so long will whatever lowers the cost of production of labour-force inevitably lower its price, aided by the increasing competition on the labour market. Thus the propertied class reaps the benefit of every improvement while capitalism endures. The working-class has, therefore, one great enemy—capitalism, and but one hope—the abolition of wage slavery,—and that is Socialism

F. C. Watts 

Quotes from Wilhelm Liebknecht. (1905)

From the June 1905 issue of the Socialist Standard

Pity for poverty, enthusiasm for equality and freedom, recognition of social injustice and a desire to remove it, is not Socialism.—W. Liebknecht

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Modern Socialism is the child of capitalist society and its class antagonisms. Without these it could not be. Socialism and ethics are two separate things. This fact must be kept in mind.—W. Liebknecht

Blogger's Note:

Both quotes are from Wilhelm Liebknecht's 1899 pamphlet, No Compromise. First published in English in 1900, No Compromise was an incredibly influential tract for early members of the SPGB.

Quorate? (1905)

From the June 1905 issue of the Socialist Standard

Far rather six men strong in the strength that comes of knowledge, with energies directed by a clear understanding and bent to a common purpose, than sixty men strong in nothing but sentiment and good intentions. For sentiment, howbeit a good thing when healthy, is always unstable, while good intentions unshaped by adequate knowledge, but serve to pave the path that leads directly to the hell of confusion.

Proverb of a Propagandist.

The new arrangement. (1905)

From the June 1905 issue of the Socialist Standard

“Harkins,” said old Barlow to his foreman, “the firm has decided to inaugurate a system of profit sharing with the employees.”

“Good ! What were the profits last year ?” 

“Last year we lost twelve thousand pounds.. That necessitates a cut of 10 per cent. in wages under the new system. Tell the men the new arrangement comes into effect immediately.”