Principles of Political Economy Part 20

Hence, the _misera ac jejuna plebecula, concionalis hirudo aerarii_, according to _Cicero_, ad Att., I, 16, 6. At a time, when the Roman census showed a population of over 1,500,000, Philippus, 104 before Christ, otherwise a "moderate" man, could claim that there were not 2,000 citizens who had any property. (_Cic._, de Off., II, 21.) True, those few were in such a position, that Cra.s.sus would allow that those only were rich, who could feed an army at their own expense. (_Cicero_, Parad., VI, 61; _Plin._, H.

N., x.x.xIII, 47.) Concerning the colossal private fortunes under some of the earlier imperators, see _Seneca_, De Benef., II, 27; _Tacit_., Ann., XII, 53, XIII, 32; XIV, 35; Dial. de Causis, 8, _Dio C._, LXIII, 2 seq.

The clients of the time, that is the numerous poorly paid idlers treated as things of little value, in the service of the great, correspond, on a small scale, to the position of the great crowd in relation to the emperor. Compare _Friedlander_, Sittengeschichte Roms., I, 296 ff. As late as the West-Gothic storm, there were many houses which drew 4,000 pounds in gold, and about 1/3 as much in kind, from their estates, per annum. (_Plut._, Bibl. Cod., 80, 63, Bekk.) G.o.ddess Pecunia Majestas divitiarum, in _Juvenal_, I, 113.

If we take the Roman proletariat in its wider extent, the most frightful picture it presents is its slave-wars. Such a war Sicily had shortly before the _tribunate_ of the elder Gracchus, cost over a million (?) livres; and at the same time there was a great uprising of slaves desolating Greece.

(_Athen._, VI, 83, 87 ff., 104.) A second war broke out in the time of Cimbri. But the most frightful was that under Spartacus, who collected 100,000 men, and the course of this uprising will always remain a type of proletarian and slave revolts. It originated among the most dangerous cla.s.s of slaves, most dangerous because best prepared for the struggle, the gladiators, and among the immense _ergastula_, where they were held together in large ma.s.ses. It spread with frightful rapidity, because the combustible material on which it fed was everywhere to be found. It was conducted with the most revolting cruelty. What the slaves demanded before all else was vengeance, and what dread had a gladiator of a death unaccompanied by torture?

After the first successes of the slaves dissensions broke out among them. Such hordes can nowhere long preserve a higher object than the momentary gratification of their pa.s.sions--a fact which shields human society from their rage. Piracy, also, is another side of this proletarian system. It found its strongest aliment in the system of spoliation practiced by the Romans in Asia Minor. The oppressed along the whole coast, joined the pirates "preferring to do violence rather than to suffer."

(_Appian_, B. Mithr., 92, _Dio C._, x.x.xII, 3.) The temples and the wealthy Romans were in special danger. But the worst feature in the horrible picture was that many of the great shared in the spoils with the robbers. They bought slaves and other booty from them at mock prices, even close by the gates of Rome. (_Strabo_, XIV, 668 seq., _Dio C._, x.x.xVI, 5.) Precisely as the slave-wars were looked upon with pleasure by the poorer free men. Incendiarism was one of the chief weapons of mutinous pauperism. (_Drumann_, IV, 282.) The celebrated baccha.n.a.lian trial and the questions of poisoning which followed it as a consequence (186 before Christ) may be looked upon, in Rome, as the first marked symptoms of the disruption between the oligarchy of money and the proletariat. This put the morality of the higher cla.s.ses in a bad light, while, at the same time, a large slave conspiracy in Apulia, which was not suppressed until the year 185, exhibited the reverse of the picture. Cato, the censor, endeavored to oppose this tendency by high sumptuary taxes, and by establishing proletarian colonies.

At the same time we see the various parties among the n.o.bility uniting and the publicans joining them. (_Nitzsch_, Gracchen, 124 ff.) The history of the last hundred years of the Republic turns chiefly on the three great attempts made by the proletariat to overthrow the citadel of the moneyed oligarchy, under the Gracchi, under Marius and under Caesar.

The last was permanently successful but entailed the loss of the freedom of both parties.

Among the pretty nearly useless remedies employed, besides those described in -- 79, I may mention the following also: the great number of agrarian laws intended to lessen estates of too great extent owned by one person, and to restore a free peasant population, in the years 133, 123, 100, 91, 59 before Christ; the law in Hannibal's time (_Livy_, XXI, 63) that no senator should own a ship with a capacity of more than 300 amphora; the provision (_Sueton._, Caes., 42) that all great herd-owners should take at least one-third of their shepherds from the ranks of freemen; the many laws _de repetundis_, the first of which was promulgated 149 before Christ, intended to protect the provinces against spoliation by the governors; the L. Gabinia, 56 before Christ, which prohibited the loaning by the provinces in Rome; lastly, a rigid enforcement of police provisions against slaves, especially against their bearing arms, which were carried to such an extent, that slaves who had killed a boar with a spear were crucified. (_Cicero_, in Verr., II, 3.) The chief rule of every real oligarchy of money is, while they hold the lower cla.s.ses in general under their yoke with great severity, to keep dangerous elements in good humor at the expense of the state. Among these are especially the rabble in large cities and the soldiery. Compare _Roscher_, Betrachtungen uber Socialismus und Communismus, 436, 437.]

[Footnote 204-11: In medieval Italy, also, popular freedom was lost through a moneyed oligarchy and a proletariat.

_Popolo gra.s.so_ and _minuto_ (_bourgeoisie_--_peuple_) in Florence. The former were reproached especially with the breach of trust in the matter of the public moneys (_Sismondi_, Gesch. der Ital. Republiken, II, 323, seq.), which reminds one of the French cry, _corruption_ in 1847.

_Machiavelli_ gives a masterly description of the cla.s.s contrasts during the last quarter of the fourteenth century, in his Istoria Fiorent., III, a. 1378, 4. The poor, whose spokesmen recall the most desperate shibboleths of modern socialists, dwell princ.i.p.ally on this, that there is only one important difference, that between rich and poor; that all men are by nature entirely equal; that people get rich only through deceit or violence; that the poor want revenge etc. It is significant how, in Florence, the largest banker finally became absolute despot, and that contemporaneously in Genoa, the Bank of St. George, in a measure, absorbed the state; the former supported by numerous loans made to influential persons like Cra.s.sus (_Machiavelli_, Ist. Fior., VII); the latter by the overstraining of the system of national debt.]

SECTION CCV.

DISTRIBUTION OF THE NATIONAL INCOME.--HEALTHY DISTRIBUTION.

Hence a harmony of the large, medium and small incomes may be considered the indispensable condition of the economic prosperity of a people.[205-1] This prosperity is best secured when the medium-cla.s.s income prevails, when no citizen is so rich that he can buy the others, and no one so poor that he might be compelled to sell himself. (_J. J.

Rousseau._)[205-2] Where there is not a numerous cla.s.s of citizens who have time enough to serve the state even gratis, as jurymen, overseers of the poor, munic.i.p.al officers, representatives of the people etc.

(compare -- 63), and property enough to be independent of the whims and caprices of others, and to maintain themselves and the state in times of need, even the most excellent of const.i.tutions must remain a dead letter. Nor should there be an entire absence of large fortunes, and even of inherited large fortunes. The changes of ministry which accompany const.i.tutional government are fully possible only when the choice of men who would not lose their social position by a cessation of their salaries as public functionaries is not altogether too limited.[205-3] Thus the transaction of the most important political business, especially that which relates to foreign affairs, requires a peculiar elasticity of mind, and a capacity for routine on the grandest scale, which with very rare exceptions, can be acquired only by habituation to them from childhood, and which are lost as soon as the care for food is felt. The bird's-eye-view of those who are born "great"

does not, by any means, embrace the whole truth of human things, but it does a very important side of it. Among this cla.s.s, as a rule, it is easiest to find great party leaders, while leaders who have to be paid by their party, generally become in the long run, mere party tools.[205-4] It is true that it requires great intellectual and moral power to resist the temptations which a brilliant hereditary condition presents; temptations especially to idleness, to pride and debauchery.

For ordinary men, it is a moral and, in the end, an economic blessing, that they have to eat their bread in the sweat of their brow,[205-5] and that they can grow rich only by long-continued frugality.[205-6]

However, the distribution of the national income, and every change in that same distribution, const.i.tute one of the most important but at the same time one of the most obscure departments of statistics.[205-7] When inequality increases because the lower cla.s.ses absolutely decline, there is no use in talking any longer about the prosperity of the nation.[205-8] It is different, of course, when only the higher cla.s.ses become, relatively speaking, higher yet. But even this latter kind of inequality may operate disastrously, inasmuch as it nourishes the most dangerous tendency of democracy, that of envy towards those who are better off.

[Footnote 205-1: _Verri_ Meditazioni, VI.]

[Footnote 205-2: _Aristotle's_ view that, in a good state, the middle cla.s.s should preponderate. (Polit. IV, 6, Sch.) _Sismondi_ says: _la richesse se realise en jouissances; mais la jouissance de l'homme riche ne s'accroit pas avec ses richesses_. (Etudes sur l'Economie politique, 1837, I, 15.)]

[Footnote 205-3: If state offices were to be filled by doctors or lawyers who live by their practice, after a time, only those could be had who had no large practice to sacrifice, that is, beginners or obscuranti.]

[Footnote 205-4: Per contra, see _Bazard_, Doctrine de Saint Simon, 323. But _Sismondi_ is certainly right: _nous ne croyons point, que les hommes qui doivent servir a l'humanite de flambeau naissent le plus souvent au sein de la cla.s.se riche; mais elle seule les apprecie et a le loisir de jouir de leurs travaux_. (Etudes, I, 174.)]

[Footnote 205-5: To appreciate the demoralizing effects of an income obtained without labor and without trouble on men of small culture, we need only witness the bourgeoisie at great watering places, pilgrimage places, seats of courts and university cities supported largely by students.

Similarly at Mecca, Medina, Meschhed, Rome, etc. (_Ritter_, Erdkunde VIII, 295 seq. IX, 32), and even in Palestine, during the crusades, when the miserable Pullanes counted on the tribute of the pilgrims. (_Wilken_, VII, 369, according to _Jacob de Vitriaco_.)]

[Footnote 205-6: A man with $100,000 a year has a much less incentive to make savings than 100 men with $1,000 each per annum, for the reason that his economic wants are already all richly satisfied, and he can have little hope of improving it by saving. (_von Mangoldt_, V. W. L., 141.)]

[Footnote 205-7: _Harrington's_ fundamental thought (1611-1677, Works, 1700) is, that the nature of the const.i.tution of a state depends on the distribution of the ownership of its land. "Balance of property!" Where, for instance, one person owns all the land or the larger portion of it, we have a despotism; where the distribution is more equal, a democracy, etc. All real revolutions are based upon a displacement of the centre of gravity of property, since in the long run, superstructure and foundation can not be out of harmony with each other. For this reason, agrarian laws are the princ.i.p.al means to prevent revolutions.

(_Roscher_, Gesch. der English. Volkswirthschaftslehre, 53 ff.) _Montesquieu_ also pays special attention to the political consequences of the distribution of wealth. Thus, for instance, in monarchies, the creation of large fortunes should be promoted by the right of primogeniture; in aristocracies, on the other hand, the great wealth of a few n.o.bles is as detrimental as that of extreme poverty. (Esprit des Lois, V, 8, 9.)]

[Footnote 205-8: The common a.s.sertion of the socialists, that the inequality of property is frightfully on the increase, is as far from being proved as is the opposite one of _Hildebrand_, Nat. Oek. der Gegenwart und Zukunft, I, 245 ff. According to _Macaulay_, Hist. of England, ch. 3, there were, in England, in 1685, only about three (ducal) families with an annual income of about 20,000 a year. The average income of a lord amounted to 3,000; of a baronet, to 900; of a member of the house of commons, to scarcely 800; and a lawyer with 1,000 per annum was considered a very important personage. At the same time, there were 160,000 families of free peasants, that is more than 1/7 of the whole population, whose average income amounted to from 60 to 70. For the year 1821, _Marshall_, Digest of all Accounts, etc., II, 1833, a.s.sumes, that there were 4,000 families with over 5,000 yearly income; 52,000 families with from 1,500 to 5,000; 386,000 families with from 200 to 1,000; 2,500,000 families with less than 200. Compare, _per contra_, the Edinburg Review, 1835. The income tax statistics of 1847 show that 22 persons had an income of at least 50,000 a year; 376 persons, from 10,000 to 50,000; 788, from 5,000 to 10,000; 400, from 4,000 to 5,000; 703, from 3,000 to 4,000; 1,483, from 2,000 to 3,000; 5,234, from 1,000 to 2,000; 13,287, from 500 to 1,000; 91,101, from 150 to 500.

If we compare these numbers with the corresponding ones of the income tax of 1812, the numbers of those who returned an income of 150 to 500 increased 196 per cent.; of those with an income of from 500 to 1,000, 148 per cent.; of from 1,000 to 2,000, 148 per cent.; of from 2,000 to 5,000, 118 per cent.; of from 5,000 and more, 189 per cent.; while the population in general had increased by about 60 per cent. Compare Athenaeum, August, 1850; Edinburgh Rev., April, 1857. Between 1848 and 1857, the development was less favorable, so that the incomes of from 150 to 500 subject to taxation, increased only 7 per cent.; those from 500 to 1,000 about 9.56 per cent.; those from 10,000 to 50,000, by 42.4, and those over 50,000, 142.1 per cent.

Between 1858 and 1864, the incomes derived from industry and commerce, subject to taxation below 200, had increased about 19.4 per cent.; those over 10,000, 59 per cent.; while the aggregate amount of all taxed incomes in this category increased 19 per cent. (Stat. Journal, 1865, 546.) According to _Baxter_, The National Income of the United Kingdom, 1868, there are now 8,500 persons with a yearly income of 5,000 and more, who draw in the aggregate 15.6 per cent. of the national British income, and on the average nearly 15,000 each. There are, further, 48,800 persons with a yearly income of from 1,000 to 5,000; 178,300 with from 300 to 1,000; 1,026,400 with from 100 to 300; and 1,497,000 with less than 100 a year from their property. In addition to this, 10,961,000 workmen on wages, with an aggregate income of 324,600,000. Compare ---- 172, 230.

In France, the number of so-called _electeurs_, who paid direct taxes to at least the amount of 200 francs was, in 1831, 166,583, and increased uninterruptedly until 1845, when it was 238,251, while the population had increased only 8.5 per cent.

In Prussia, the revenue from cla.s.s-taxation up to 1840, increased, unfortunately, in a smaller proportion than the population: hence the lowest cla.s.ses must have increased relatively more than the others. (_Hoffmann_, Lehre von den Steuern, 176 ff.) Between 1852 and 1873, according to the statistical returns from cla.s.s-taxation and of the cla.s.sified income tax, the growth of large incomes in the provinces of old Prussia, seems to have been much more rapid than that of the smaller ones. Thus, for every 100 taxpayers, with an income of from 400 to 1,000 thalers, there was an increase to 175.5; of from 1,000 to 1,600 thalers, for every previous 100, 210.2; from 1,600 to 3,200 thalers, 232.3; of from 3,200 to 6,000, 253.9; of from 6,000 to 12,000 thalers, 324.8; of from 12,000 to 24,000, 470.6; of from 24,000 to 52,000 thalers, 576.3; of from 52,000 to 100,000 thalers, 568.4; of from 100,000 to 200,000 thalers, 533.3; of over 200,000, 2,200. Hence, probably, a greater growth towards the top, than the general increase in the population will account for.

This concentration of property took place most noticeably in Berlin, where for instance, between 1853 and 1875 the incomes of from 1,000 to 1,600 thalers increased 212.2 per cent.; those from 24,000 to 52,000, 994.1 per cent. There are now in the whole state 2.24 per cent. of the population (including those dependent on them) subject to the income tax; that is, estimated as having a yearly income of 1,000 thalers. Of the remaining 97.76 per cent., more than a quarter, and probably more than one-half, are as a cla.s.s free from taxation, because their income is presumably less than 140 thalers (6,049,699 against 532,367, exempt for other reasons and 4,850,791 belonging to cla.s.ses subject to taxation: these three numbers probably not including dependents). Among the payers of an income tax, there are 79,464 with an average income of 1,237 thalers per annum; 41,366 with 2,171 thalers; 12,305 with 4,279 thalers; 4,030 with 8,383 thalers; 1,655 with 16,527 thalers; 513 with 32,428 thalers; 163 with 65,595 thalers; 39 with 137,692 thalers; 21 with 427,142 thalers; and one with 1,700,000 thalers per annum. (Preuss. statist. Ztschr., 1875, 116, 132, 142, 145, 149.) As the reverse of this picture, we may take the fact that, in 1870, of 1,047,974 cases of guardianship, there were only 208,614 in which there was any property to be looked after. (Justiz-Minist-Blatt, 1872, No.

6.)

The figures from Bremen are very favorable. The incomes subject to taxation amounted, in 1847, to 71.6 thalers per capita; in 1869, to 131.2. The incomes subject to taxation in cla.s.s No. 1, that is from 250 to 399 thalers, increased 78 per cent.; in cla.s.s No. 2, 400 to 499 thalers, 45 per cent.; in cla.s.s No. 3, 500 thalers and more, by 57 per cent.

The average income of the third cla.s.s amounted, in 1847-50, to 1,952 thalers; 1866-69, to 2,439 thalers. In 1848, there were, of estates of over 3,000 thalers subject to taxation, only 38 to every 1,000 inhabitants; in 1866, 49. (Jahrb. f.

amtl. Statistik Bremens, 1871, Heft 2, p. 185 seq.)]

BOOK IV.

CONSUMPTION OF GOODS.

CHAPTER I.

CONSUMPTION OF GOODS IN GENERAL.

SECTION CCVI.

NATURE AND KINDS OF CONSUMPTION.

As it is as little in the power of man to destroy matter as it is to create it, we mean by the consumption of goods, in the broad sense of the word, the abolition of or the doing away with an utility without any regard to the question whether another higher utility takes its place; in its narrower sense (consumption proper), a decrease of resources of any kind. Consumption is the counterpart of production (-- 30), the top of the tree of which production is the roots, and the circulation and distribution of goods the trunk. (_A. Walker._) There is, also, what Riedel calls immaterial consumption, as when a utility disappears, either because the want itself to which it ministers disappears or because views have changed as to the means to be employed towards its satisfaction.[206-1]

[Footnote 206-1: Diminutions of value, such, for instance, as an almanac, a newspaper, etc., undergoes simply from the appearance of the next years' etc.; of a shield or a part of an officer's uniform with the initials of the reigning sovereign, only because of the fact of a new succession to the throne. A boot or a glove loses a great part of its value when its mate is destroyed. (_Rau_, Lehrbuch, -- 319.)]

SECTION CCVII.

NATURE AND KIND OF CONSUMPTION.--THE MOST USUAL KIND.

The commonest kind of consumption is that caused by the use of a thing, or by the employing of it for the purpose of acquisition or of enjoyment.[207-1] From time immemorial, enjoyment-consumption has been, preponderantly, the affair of women, as acquisition-consumption has been the business of men.[207-2] Other circ.u.mstances being equal, the degree or extent of consumption by use (use-consumption) is determined by national character. Thus, for instance, the cleanliness and love of order characteristic of the Dutch have contributed greatly to the long preservation in good condition of their dwellings and household articles.[207-3]

In the higher stages of civilization, the use of goods is wont to be divided more and more into special branches, according to the different peculiarities of the goods themselves, and of the different wants of men; a course of things which is, both as cause and effect, intimately related to the division of labor. I here speak of a principle of _division of use_ (differentiation and specialization). Thus, for instance, Lorenz Lange, in 1722, found only one kind of tea in the trade between Russia and China; Muller, in 1750, found seven; Pallas, in 1772, ten; and Erman, in 1829, about seven hundred.[207-4] As the number of gradations of different kinds of the same goods increases with civilization, there is, in times of war, a retrogression in this respect, to a lower economic stage.[207-5]

Opposed to this, we have the principle of the combination of use. There are numberless kinds of goods which may serve a great many just as well as they can one exclusive user; and this either successively or simultaneously, inasmuch as there is no necessity why, with the increasing use of the object, the size of the object itself should increase in an equal proportion. (According to Marlo: wealth usable by one; wealth usable by many; wealth usable by all.) Thus, for instance, a public library may be incomparably more complete, and accessible in a still higher degree than ten private libraries which together cost as much as it did. And so, a restaurant-keeper may serve a hundred guests at the same time, with a much greater table-variety, more to their taste, and at a more convenient time, than if each person made the same outlay for his private kitchen.[207-6] While formerly, only the great could travel rapidly, combination of use has enabled even the lower cla.s.ses to do so in our own days. There is, doubtless, a dark side to this picture, too. Combination of use requires frequently great sacrifices of personal independence, which should not be underestimated when they affect individuality of character, or threaten the intimacy and closeness of family life. It is, however, a bad symptom when the division of use increases without any corresponding combination of use.[207-7] [207-8]

[Footnote 207-1: We should also mention here destructive consumption, where the defenders of a country destroy buildings, supplies, etc., only that the enemy may not use them.]

[Footnote 207-2: Compare Die Lebensaufgabe der Hausfrau, Leipzig, 1853; _von Stein_, Die Frau auf dem Gebiete der National Oekonomie, 1875, and the beautiful remarks of _Schaffle_, N. Oek., 166; and _Lotz_, Mikrokosmus, II, 370 ff.]