Abstract
This chapter traces the way in which Smith’s thought was distorted and revised with specific reference to the effects that the combinations phenomenon could have on the labour market and wage-setting. At the end of the eighteenth century, the notion that conspiratorial strategies aimed at creating threatening presences with monopolistic intentions could reciprocally cancel each other out slipped into the background once again. The passing of the Combination Laws was the final nail in the coffin of this idea: no one should be entitled to resort to such actions. Yet, for many people, these associative strategies were nothing more than the spontaneous organisation of society. Twenty-five years later the scenario had radically altered. This chapter illustrates the path that led to the abolition of the Combination Laws and to the countervailing powers being stripped of their old moral robes and cloaked instead in the garb of the new liberal economy.
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Notes
- 1.
Which went on to become one of Marx’s main sources for part of Das Kapital.
- 2.
In addition, ʻone could not directly or indirectly endeavour to prevent a workman from agreeing to work or endeavour to prevail on a workman already hired to leave work; nor could one endeavour to prevent any master from employing whomever he pleasedʼ; moreover, once hired, a workman ʻcould not refuse to work with any other workmanʼ (Orth 1991: 45–46).
- 3.
Parliamentary Register, 8 (1799): 323. Wilberforce was by this time already known as one of the leading exponents of the movement for the abolition of slavery.
- 4.
Parliamentary Register, 8 (1799): 687.
- 5.
Parliamentary Register, 8 (1799): 687.
- 6.
Parliamentary Register, 8 (1799): 687.
- 7.
Parliamentary Register, 9 (1799): 65.
- 8.
Parliamentary Register, 9 (1799): 562–565.
- 9.
Parliamentary Register, 9 (1799): 563.
- 10.
Parliamentary Register, 9 (1799): 564.
- 11.
George M. Trevelyan (1922: 200) also considered these laws as ʻa relic of the days of anti-Jacobin panicʼ.
- 12.
The decision taken at a meeting held in Speenhamland, in Berkshire, on 6 May 1795 established that the State would top up workers’ wages with a subsidy calculated on a sliding scale and linked to the price of bread, in order to ensure a minimum income for the poor irrespective of their wages. On the ideology that led to the adoption of this measure, on the effects and the movement that led to its suppression, see the still fundamental pages of Karl Polanyi (1944: ch. 7).
- 13.
ʻIt altered the subpolitical attitudes of the people, affected class alignments, and initiated traditions which stretch forward into the present centuryʼ (Thompson 1991: 111).
- 14.
Nevertheless, Thompson (1991: 550–552) maintains that the Combination Laws did not make illegal realities that had been hitherto legal: ʻThere was, in fact, sufficient legislation before the 1790s to make almost any conceivable trade union activity liable to prosecution – as conspiracies in common law, for breach the contract, for leaving work unfinished, or under Statute law covering separate industriesʼ (Thompson 1991: 550).
- 15.
That wasn’t all. Behind the ban to resort to the weapon of combination for many workmen (this was actually tolerated for ʻfactors, merchants, wholesale dealers and opulent manufacturersʼ)—then definitively endorsed in the act of 1799—there was another issue related to the lack of representation, in turn linked to a difference in treatment, and hence to a question of inequality (Hampsher-Monk 1991: 5).
- 16.
Thelwall referred in his writings to both Locke and Smith to maintain that an economy such as the one which was taking shape denied the workers both their original rights to the land and a just recompense for their labour (Hampsher-Monk 2006: 685).
- 17.
The bargaining between employers and workers to define wages concealed a form of ʻmonopolistic extortionʼ, which patently involved the negation of certain principles of natural law; the workers were obliged to deal with subjects that were not acting in the market as individuals, but were, in effect, members of a ʻcorporationʼ (Hampsher-Monk 1991: 17).
- 18.
ʻConsequently Thelwall did not attempt to revive a ‘moral economy’ of just prices and fair wages either, since wages were to be proportionate to profit, not to the cost of living. Instead he proposed a new vision of economic justice centering on the contractual relations between worker and employerʼ (Caeys 1994: 274).
- 19.
The elements of continuity had already been noted by M. Dorothy George (1936: 172–178).
- 20.
ʻThus it was that prosecutions often took place, not under the Acts of 1799-1800, but under previous legislation – the common law of conspiracy, or under the Elizabethan Statute of Artificers (5 Eliz. c. 4) penalizing workers for leaving works unfinishedʼ (Thompson 1991: 553).
- 21.
ʻThe Combination Act was criticised for vagueness; the specific offences of endeavouring to prevail on a workman to leave and of refusing to work with a particular workman were singled out. These, of course struck at the source of workmen’s power, control over the supply of labour. But none of the petitions made extensive criticism of the substantive sections, and none protested at the absence of wage regulation. It was the procedures that attracted most attentionʼ (Orth 1991: 49).
- 22.
- 23.
Parliamentary Debates, 27 (1813–1814): coll. 572–573. On this passage, see Rothschild (2001: 93).
- 24.
As argued by Moher (1988: 90): ʻDespite the vigorous opposition of the organised journeymen, Parliament had swept away in 1813-14 most of the old legislation regulating wages and apprenticeshipʼ.
- 25.
As Place himself wrote: ʻIts effect on many members was remarkable; several of them told me there was no resisting the conclusive arguments it contained, and one of them said he was prepared to speak the substance of the essay in the Houseʼ (Wallas 1898: 208). On McCulloch’s opinion on the Combination Laws, see O’Brien (1970: 366–370).
- 26.
ʻNot only, therefore, is a combination harmless in itself, but when it is entered into for the purpose of raising wages that have been unduly depressed, its object is most proper and desirable. No master ever willingly consents to raise wages; and the claim either of one or of a few individuals for an advance of wages is sure to be disregarded, so long as their fellows continue to work at the old rates. It is only when the whole, or the greater part of the workmen belonging to a particular master or department of industry combine together, or when they act in that simultaneous manner which is in every respect equivalent to a combination, and refuse to continue to work without receiving an increase of wages, that it becomes the interest of the masters to comply with their demand. And hence it is obvious, that without the existence either of an open and avowed, or of a tacit and real combination, workmen would never be able to obtain a rise of wages by their own exertions, but would be left entirely dependent on the competition of their mastersʼ (McCulloch 1824: 319).
- 27.
ʻThus it appears, that if wages are at any time lower than they ought to be, a combination on the part of the workmen is highly proper and expedient, as being one of the best means of inducing their masters to raise them to their proper level. But if wages have already reached their natural limits, the self-interest of the masters will induce them to resist the combination, and the workmen will not obtain another farthing. The laws to prevent combinations are, therefore, either unnecessary, or unjust and injurious. They are unnecessary, whenever the rate of wages is as high as circumstances will permit; and they are unjust and injurious whenever it is below that levelʼ (McCulloch 1824: 323).
- 28.
This is the observation ultimately made by Place: ʻThe laws against combinations were inimical to the working people in many respects. They induced them to break and disregard the laws. They made them suspect the intentions of every man who tendered his services. They made them hate their employers with a rancour which nothing else could have produced. And they made them hate those of their own class who refused to join them, to such an extent as cordially to seek to do them mischiefʼ (Wallas 1898: 239).
- 29.
According to Arthur Aspinall (1949: XXV), Place’s efforts would have been in vain if Parliament had not taken Smith’s ideas into due consideration in the interim.
- 30.
According to William D. Grampp (1979: 506), Place’s arguments did not entirely coincide with those of McCulloch, who insisted above all on the fact that competition would render the combinations peaceful and relatively ineffective.
- 31.
As Place noted: ʻFrom one end of the country to the other masters and men were engaged in industrial conflictʼ (Wallas 1898: 218).
- 32.
On this passage, William D. Grampp (1979: 506).
- 33.
Although his vision of society was not marked by the presence of a mechanism that ensured ʻthe mutual compatibility of individual interestsʼ; instead it was ʻone of the potential conflicts between the productive classes of a capitalist systemʼ (Milgate and Stimson 2009: 52).
- 34.
This passage of the letter is also quoted by Grampp (1979: 506).
- 35.
Nevertheless, ʻby the standard of fairness the laws were objectionable because while they fell on employers, they fell more heavily on workersʼ (Grampp 1979: 515). Moreover, as noted by Milgate and Stimson (2009: 53): ʻIn practical and policy terms, Ricardo became convinced that the general character of society was, in the short run, one of an inherent conflict between the classes, over which the government and the statesman could exercise little or no direct role in ameliorating the inconveniences. They must rely instead on the long-run workings of the market mechanismʼ.
- 36.
ʻThus far, the 1824 Act was negative only: it swept away all the laws (common as well as statute) on combination and conspiracyʼ (Orth 1991: 79).
- 37.
According to the liberal jurist, the act of repealing gave expression to two convictions: ʻthe one is the belief that trade in labour ought to be as free as any other kind of trade; the other is the well-grounded conviction that there ought to be one and the same law for men as for mastersʼ (Dicey 1904: 522). See also Dicey (2008: 137–138).
- 38.
According to William D. Grampp, the influence of economists ʻalthough noticeable, was smallʼ. There were indeed ʻthree other groups that influenced the event much more: one was the leadership of political parties, especially the Tory; another was the radical reformers; the third was the working classʼ (Grampp 1979: 501).
- 39.
As has been pointed out by Samuel Hollander (1973: 126), ʻAccordingly, the Smithian conception of competition must be carefully distinguished from the modern conception which envisages sellers (and consumers) as price takers rather than price makersʼ (italics mine).
- 40.
- 41.
As has been pointed out by Noel Thompson (1998: 46), ʻwhat strikes one immediately about these works [Labour Defended Against the Claims of Capital, 1825; Popular Political Economy, Four Lectures Delivered and the London Mechanics’ Institute, 1827; The Natural and Artificial Rights of Property Contrasted, 1832] is the extent to which they embraced the concepts and analytical devices of classical political economyʼ. But we must also say that Hodgskin ʻrejected the Malthus-Ricardo idea that wages were kept at subsistence level through the operation of the principle of population—it was not natural in any sense. He instead located the problem squarely in the domain of social regulationʼ (Milgate and Stimson 2009: 232).
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Rosolino, R. (2020). Who’s Afraid of Giants?. In: Countervailing Powers. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-37802-8_5
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