Progress and Poverty · Chapter
Insufficiency of Remedies Currently Advocated explained
This chapter critiques various proposed remedies for poverty and inequality, including trade unions, cooperation, land subdivision, and education.
What happens
This chapter critiques various proposed remedies for poverty and inequality, including trade unions, cooperation, land subdivision, and education. It argues that these measures fail because they do not address the root cause: the monopolization of land and the extraction of rent. The author demonstrates that strikes and labor combinations are destructive and tyrannical, cooperation cannot raise wages, and efforts to subdivide land or improve worker habits are ultimately ineffective against the tendency of rent to drive down wages.
Themes in this chapter
Wages and Labor
The chapter examines how strikes and trade unions fail to raise wages, and argues that wages are determined by rent, not by labor organization.
Land Ownership and Rent
Central to the critique: land monopolization and the tendency toward concentration of ownership drive down wages and cause poverty.
Distribution of Wealth
The chapter argues that proposed remedies like cooperation and land subdivision do not address the fundamental inequality in wealth distribution caused by rent.
Characters to notice
- Unknown
The narrator reflects on his own experience as a union member and critiques the effectiveness of trade unions and strikes.
- Sir Henry Maine
Referenced for his findings on the ancient Hindu practice of 'sitting dharna' and its parallels in Irish Brehon laws.
- Benjamin Franklin
Cited as an example of individual frugality, but the author argues that such practices cannot raise general wages.
- David Ricardo
Implied through the discussion of rent and distribution of wealth, though not directly named in the excerpts.
Key passages
“The methods by which a trade union can alone act are necessarily destructive; its organization is necessarily tyrannical.”
Trade unions must use destructive tactics like strikes, and their internal structure requires sacrificing personal freedom, similar to military discipline.
The author critiques the inherent flaws in union methods, comparing strikes to war.
“Cooperation in supply, let it go as far as it may in excluding middlemen, only reduces the cost of exchanges. It is simply a device to save labor and eliminate risk, and its effect upon distribution can be only that of the improvements and inventions which have in modern times so wonderfully cheapened and facilitated exchanges— viz. , to increase rent.”
Cooperative supply chains merely cut out middlemen and lower transaction costs, but like other efficiency gains, they ultimately benefit landowners by increasing rent, not workers.
The author dismisses cooperation as a remedy, arguing it does not alter the fundamental distribution of wealth.
“If, under existing conditions, American mechanics would come down to the Chinese standard of living, they would ultimately have to come down to the Chinese standard of wages; or if English laborers would content themselves with the rice diet and scanty clothing of the Bengalee, labor would soon be as ill paid in England as in Bengal.”
If workers lower their living standards to compete, wages will fall correspondingly, as seen in the Irish potato example where reduced subsistence led to lower wages and famine.
The author argues that individual frugality cannot raise general wages because competition drives them down to the subsistence level.