August Bebel. Woman and Socialism
The State and Society

Chapter XVII.
The Process of Concentration in Capitalistic Industry.

1. – The Displacement of Agriculture by Industry.

The capitalistic system of production not only dominates the social organization but also the political organization. It influences and controls the thoughts and sentiments of society. Capitalism is the ruling power, The capitalist is lord and master of the proletarian, whose labor power he buys as a commodity to be applied and made use of, at a price that oscillates according to supply and demand and the cost of production, as with every other commodity. But the capitalist does not buy labor power “to please God,” or to render a service to the workingman – as he sometimes seeks to present it – but to obtain surplus value by it, which he pockets in the form of profit, interest and rent. This surplus value squeezed out of the workingman – inasmuch as it is not spent by the employer for his personal enjoyment – is crystallized into capital, and enables him steadily to enlarge his plant, to improve the process of production, and to employ more labor power. Thereby again he becomes enabled to encounter his weaker competitor, as a horseman, clad in armor, might encounter an unarmed pedestrian, and to destroy him.

This unequal struggle is developing more and more in all domains, and woman, furnishing the cheapest labor power, beside the child, plays an important part in this struggle. The result of these conditions is, that the line of demarcation becomes sharper between a relatively small number of powerful capitalists and the great mass of non-possessors of capital, who depend upon the daily sale of their labor power. With this development the position of the middle classes is becoming more and more unfavorable.

One line of industry after another, where until recently the small manufacturers predominated, are being taken hold of by capitalistic enterprise. The competition of the capitalists among themselves compels them constantly to seek new realms to be exploited. Capital goes about “like a roaring lion seeking something to devour.” The small men are ruined, and if they do not succeed in finding some other field of activity – which is becoming increasingly difficult – they sink down into the class of wage-workers. All attempts to prevent the decline of handicraft and the middle class by means of laws and institutions that have been taken from the shelves of the past, prove useless. They may deceive one or another for a little while in regard to his true position, but soon the delusion is dispelled by the force of facts. The process of absorption of the small ones by the great ones is becoming clearly evident to all with the unrelenting force of a natural law.

In what manner the social structure of Germany has been transformed during the brief period of twenty-five years – from 1882 to 1895 and from 1895 to 1907 – that may be seen by a comparison of the census figures from these years, as shown by the following table:

Persons gainfully employed in principal calling Increase (+) or decrease (-) since 1882

1882 1895 1907

Agriculture 8,236,496 8,292,692 9,881,257 + 1,646,761 = 19.89

Industry 6,396,465 8,281,220 11,256,254 4,859,789 = 75.98

Commerce and Traffic 570,318 2,338,59 3,477,626 1,907,308 = 121.46

Domestic service 397,582 432,491 471,495 74,113 = 18.63

Public service and learned professions 1,031,47 1,425,961 1,738,530 707,383 = 68.56

No occupation 1,354,486 2,142,808 3,404,983 2,050,497 = 151.40

Total 18,986,494 22,913,683 30,232,345 +11, 145,851 = 53.95

Persons gainfully employed including their families Increase (+) or decrease (-) since 1882

1882 1895 1906

Agriculture 19.22.5,455 18.501,307 17681,176 1,544,279 = 18.18

Industry 16 058,080 20,253,241 26:38 .537 10,328,457 = 64.25

Commerces and Traffic 4,531,080 5,966,836 8,278,239 3,747,159 = 82.69

Domestic service 938,294 886,807 792.748 145,546 = 15.57

Public service and learned professions 2,222,982 2,835,014 3,407,126 + 1,184,144 = 53.33

No occupation 2,246,222 3,327,069 5,174,703 + 2:928.481 = 130.36

Total 45.222,113 51,760,284 61,720,528 +19,878,066 = 34.27

These figures show that during the twenty-five years, referred to, a considerable shifting of the population and its occupations has taken place. The population employed in industry, commerce and traffic has increased at the expense of the agricultural population. Almost the entire increase in population – 6,548,171 from 1882 to 1895, and 9,950,245 from 1895 to 1907 – has been absorbed by the former. Although the number of persons gainfully employed in industry as their principal calling has increased, this increase has not kept pace with the general growth of the population, and the number of the members of the families of persons so employed has even decreased by 1,544,279 = 8 per cent.

Industry (including the building trades and mining), commerce and traffic, present a different aspect. Here the number of persons gainfully employed and their families have considerably increased; in fact, they have increased more rapidly than the population. The number of persons employed in industry exceeds the number of persons employed in agriculture by 1,372,997 = 15 per cent. The number of the members of their families exceeds the number of the members of families of persons employed in agriculture by 8,705,361 = 49 per cent. The numbers of persons employed in commerce and traffic, together with their families, show a still greater increase.

The result is that the agricultural population, which is the real conservative portion of the population and forms the mainstay of the old order of things, is being repressed more and more and overtaken by the population engaged in industry, commerce and traffic. That the number of persons engaged in learned professions and their families have increased likewise, does not alter these facts. The strong increase in the number of persons having no occupation and their families is due to the growing number of persons living on their rents, including accident, invalid and old-age insurance, the greater number of persons dependent on charity, students of all sorts, and inmates of poorhouses, hospitals, insane asylums and prisons.

Another characteristic fact is the slight increase in the number of persons employed in domestic service and the direct decrease in the number of servants. This shows, firstly, that fewer persons can afford to employ domestic help; it shows furthermore that proletarian women who strive for greater independence, like this profession less and less.

In 1882 the number of persons engaged in agriculture as their principal calling constituted 43.39 per cent. of persons gainfully employed; in 1895, 36.19 per cent., and in 1907 only 32.69 per cent. The agricultural population – including the families of those gainfully employed in agriculture – in 1882 constituted 42.51 per cent. of the entire population; in 1895, 35.74 per cent., and in 1907 only 28.65 per cent. Those employed in industry as their principal calling constituted, in 1882, 33.69 per cent. of the entire population; in 1895, 36.14 per cent., and in 1907, 37.23 per cent. Including their families, they constituted 35.51 per cent. in 1882; 39.12 in 1895, and 42.75 in 1907. The following figures show the percentage of persons employed in commerce and traffic:

Persons employed. Including their families.

1882 8.27 10.02

1895 10.21 11.52

1907 11.50 1341

We see, then, that in Germany, at present, 56.16 per cent. of the population (in Saxony even 74.5 per cent.) depend upon industry and commerce, and that not more than 28.65 per cent. (in Saxony only 10.07 per cent.) are engaged in agriculture.

2. – Increasing Pauperization. Preponderance of Large Industrial Establishments.

It is also important to state how the population employed in gainful occupations is divided among independent workers, employes and laborers, and what proportion of each of these is furnished by either sex. This information may be gathered from the table on the following page.

This table shows that the number of persons independently engaged in agriculture increased by 280,692 from 1882 to 1895, an increase of 12.5 per cent.; but that from 1895 to 1907 it decreased by 67,751, so that from 1882 to 1907 the number of independent persons in agriculture has increased by only 212,941 = 9.2 per cent. On the other hand the number of workingmen that had decreased by 254,025 = 4.3 per cent., from 1882 to 1895, has, since 1895, increased by 1,655,677 = 29.4 per cent. Upon examining this increase more closely we find that it is mainly due to female members helping to support the families. (Among the total increase of 1,990,930 are 170,532 male and 1,820,938 female.) When we take only the rural day-laborers and help into consideration, we find that the male workers have decreased by 38,195 persons, while the female workers have increased by 45,942 persons. Altogether this shows the considerable decrease of 335,253 persons among agricultural laborers. In agriculture, then, not only the number of independent persons, but also the number of help and day laborers has decreased. The increase in the agricultural occupation, compared to the previous census, is due to the greatly increased assistance from members of the families, especially the female members.

Independent Persons Employees Wage-workers

1882 1895 1907 1882 1895 1907 1882 1895 1907


Male 2,010,865 2,221,826 2,172,740 60,763 78,066 82,549 3,629,959 3,239,646 3,028,983

Female 277,168 346,899 328,234 5,881 18,107 16,264 2,251,860 2,388,148 4,254,488

Total 2,288,022 2,568,725 2,500,974 66,644 96,173 98,8 12 5,881,819 5,627,794 7,283,471


Male 1,621,668 1,542,272 1,499 832 96,807 254,421 622,071 3,551,014 4,963,409 7,030,427

Female 579,478 519,492 477,290 2,269 9,324 63,936 545,2 1,562,698

Total 2,201,146 2,061,764 1,978,122 99,076 263,745 686,007 4,096,243 5,955,711 8,593,125


Male 550,936 640,94, 765,551 138,387 249,920 426,220 582,885 836,042 1.354,482

Female 150,572 202 616 246,641 3,161 11,987 79,689 144,377 365,005 605,043

Total 701,508 843,557 1,012,192 141,548 261,907 505,900 727,262 1,201,047 1,959,525


Male 4,183,469 4.405,039 4,338,123 295,957 582,407 1,130,839 7,763,8589,071,097 13,694,160

Female 1,007,218 1,069,007 1,052,165 11,311 39,418 159,889 2,941,455 3,715,455 4,161,961

Total 5,190,685 7,474,046 5,390,288 307,268 621,825 1,290,728 10,705,324 12,816,5521 17,856,121

The industrial occupation presents a different picture. In a term of 25 years the persons independently employed decreased by 234,024=10.6 per cent., while the population increased by 36.48 per cent. Mechanics, working alone or working with two assistants, have mainly disappeared. The number of wage-workers has increased by 1,859,468 from 1882 to 1895, and by 2,637,414 from 1895 to 1907. When we count only the wageworkers proper, not including the members of their families who assist at their work, we find that their number has increased from 5,899,708 in 1895 to 8,460,338 in 1907. Three-quarters of all persons employed in industrial occupations are wage-workers (75.16 per cent).

In commerce and trade we find the opposite ratio. Here the number of persons independently engaged has greatly increased, but the number of employes and workers has increased likewise. The number of women independently engaged in commerce has increased especially; they chiefly are either widows who seek to make their living as small dealers, or married women who endeavour to increase their husbands’ income. The number of persons independently engaged in commerce increased by 310,584 = 44.3 per cent, from 1882 to 1907. But the number of employees and wage-workers has increased still more (by 364,361 = 258.8, and by 1,232,263 = 169.4 per cent). This shows how tremendously commerce and trade have developed, particularly from 1895 to 1907. There are almost twice as many employees as prior to that period, and among these almost six times as many female employees.

During the period from 1882 to 1907 the entire number of persons independently engaged in the three occupations increased by 5.7 per cent.; it did not keep pace then with the increase in population (36.48 per cent). The number of employes increased by 325.4 per cent., and the number of wage-workers by 39.1 per cent. We must furthermore take into consideration that among 5,490,588 independent persons, many lead an entirely proletarian existence. Among the 2,086,368 manufactories enumerated there were no less than 994,743 small producers who worked alone and 875,518 who did not employ over five assistants. In commerce there were, in 1907 among 709,231 establishments, no less than 232,780 maintained by the owners without assistance. There were, besides, 5240 porters, errand-boys, etc., and thousands of insurance agents, book agents, etc.

Another point to be considered is that the number of independent persons in the three occupations does not coincide with the number of establishments. If a firm, for instance, has dozens of branch establishments, as is frequently the case in the tobacco trade, or if a concern runs a number of stores, each branch is enumerated as an individual establishment. The same is true of industrial enterprises, when, for instance, a machine factory also runs an iron foundry, a carpenter shop, etc. The figures then do not convey sufficient information regarding the concentration of capital on the one hand and the standard of living on the other. And yet, in spite of all these deficiencies, the results of the latest census of June, 12, 1907, present a picture of the most powerful concentration of capital in industry, commerce and traffic. They show that, hand in hand with the industrialization of our entire economic system, a concentration of all the means of production into a few hands is rapidly progressing.

The independent small manufacturers and traders working alone, of whom there still were 1,877,872 in 1882, have become fewer again since 1895. In 1895, 1,714,351 were enumerated, and in 1907 only 1,446,286; a decrease of 431,586 = 22.9 per cent. The number of small producers and dealers has rapidly decreased from census to census. In 1882 it was 59.1 per cent.; 1895, 46.5, and, 1907, only 37.3 per cent. of all persons gainfully employed. At the same time the number of large manufacturing and commercial enterprises has grown from 22.0 to 29.6, and (1907) to 37.3 per cent. From 1895 to 1907 the number of persons employed by small concerns increased by 12.2 per cent.; the number of those employed by concerns of medium size, by 48.5 per cent.. and the number of those employed by large concerns, by 75.7 per cent. Among 5,350,025 persons industrially employed in 1907, the by far largest group is employed by large concerns, while, in 1882, a greater number of persons were small, individual producers. In the seven following branches of industry the large concerns predominate, employing more than half of all persons engaged in these industries. Of each 100 persons the following percentage were employed by large concerns:

Mining 96.6 per cent.

Machine manufacture 70.4

Chemical trades 69.8

Textile trades 67.5

Paper trades 58.4

Industry of pottery and earthenware 52.5

Industry of soaps, fats and oils 52.3

In the other groups industry on a large scale already predominated in 1895, and everywhere its predominance has been still further increased. In the malleation of metals, 47.0; in the polygraphic trades, 43.8; in traffic, 41.6, and in the building trades, 40.5 per cent. of all persons were employed by large concerns.) We see, then, that in almost every branch development has favored industry on a large scale.

The concentration of manufacture and the concentration of capital, which are one and the same thing, take. place particularly rapidly wherever capitalistic production obtains full control. Let us, for instance, consider the brewing industry. In the German brewery-tax district, excluding Bavaria, Wurtemburg, Baden and Alsace-Lorraine, there were:

Number of breweries. Producing 1000 hectolitres of beer.

1873 13,561 10,927 19,655

1880 11,564 10,374 21,136

1890 8,969 8,054 32,279

1900 6,903 6,283 44,734

1905 5,995 5,602 46,264

1906 5,785 5,423 45,867

1907 5,528 5,251 46,355

So the number of breweries decreased, from 1873 to 1907, by 8,033 = 59.3 per cent.; that of breweries decreased by 5,676 = 51.9 per cent., but the production of beer increased by 26,700,000 hectolitres = 135.7 per cent. This signifies a downfall of the small concerns and a tremendous growth of the large concerns, whose productivity has been multiplied. In 1873, 1,450 hectolitres and in 1907 8,385 hectolitres were produced by each brewery. It is the same wherever capitalism rules.

Similar results are shown by the German coal-mining industry and other mining industries of the German Empire. In coal mining the number of concerns that amounted to an average of 623, from 1871 to 1875, dwindled down to 406, in 1889. But at the same time the production of coal rose from 34,485,400 tons to 67,342,200 tons, and the average number of persons employed increased from 127,074 to 239,954. The following table illustrates this process of concentration in the mining of mineral coal and brown coal, until 1907:

Year Number of Concerns Mineral Coal Average No. Employed Quantity 1000 tons Number of Concerns Brown Coal Average No Employed Quantity 1000 tons

1900 338 143,693 109,290.2 569 50,911 40,498.0

1905 331 493,308 121,298.6 533 54,969 52,512.1

1906 322 511,108 137,117.9 536 58.637 56,419.6

1907 313 545,330 143,185.7 535 66,462 62,546.7

We see, then, that, in the production of mineral coal since the seventies, the number of concerns has de creased by 49.8 per cent., while the number of wageworkers employed has increased by 216.9 per cent., and the output even by 420.6 per cent. The following table shows the development in the entire mining industry:

Year Number of concerns Average number employed Quantity 1000 tons

1871-75 3,034 277,878 51,056.0

1887 2,146 337,634 88,873.0

1889 1,962 368,896 99,414.0

1905 1,862 661,310 205,592.6

1906 1,862 688,853 229,146.1

1907 1,958 734,903 242,615.2

Here the number of concerns has decreased by 35.5 per cent., while the number of wage-workers employed increased by 164.4 per cent., and the output, 374.5 per cent. The number of employers had grown smaller but wealthier, and the number of proletarians had greatly increased.

In the industrial districts of the Rhine and Westphalia there still were 156 mines in 1907, but 34 of these con trolled more than 50 per cent. of the output. Although the census enumerates 156 mines, the coal trust, which controls the mines with but a few exceptions, had only 76 members. To such extent the process of concentration has developed. According to the reports of February, 19o8, the output of the coal trust amounted to 77.9 million tons of coal.[1]

In 1871 there were 306 blast-furnaces, employing 23,191 laborers and producing 1,563,682 tons of crude iron. In 1907, 303 blast furnaces, employing 45,201 laborers, produced 12,875,200 tons. In 1871 crude iron was produced at the rate of 5,110 tons for every blast-furnace; in 1907 at the rate of 42,491 tons for every blast-furnace.

According to a list published in “Steel and Iron,” in March, 1896, only one blast-furnace in Germany was able to produce crude iron at the rate of 820 tons in 24 hours. But in 1907 there were 12 blast-furnaces that could, within 24 hours, produce 1000 tons, and more.[1]

In 1871-1872, 311 factories in the beet sugar industry consumed 2,250,918 tons of beets. In 1907-1908, 365 factories consumed 13,482,750 tons. The average consumption of beets per factory was 7,237 tons during 1871-1872, and 36,939 tons during 1907-1909. This mechanical revolution does not take place in industry alone, but also in commerce and traffic. The following table shows the development of German maritime trade:

Year Sailing vessels Regist’d tonnage Number of crew

1871 4,372 900,361 34,739

1901 2,272 525,140 12,922

1905 2,294 493,644 12,914

1908 2,345 433,749 12,800

1909 2,361 416,514 12,844

Less than in 1871 2,011 less 483,817 less 21,895

Sailing vessels, then, are considerably diminishing, and among those still existing the registered tonnage and the number of the crew is decreasing. In 1871 there were, for each sailing vessel, 205.9 registered tonnage and 7.9 members of the crew. In 1909 each sailing vessel had an average of but 1764 registered tonnage, and only 5.4 members of the crew German maritime trade by steam navigation presents a different aspect, as the following table shows:

Year Ocean-going steamships Regist’d tonnage Number of crew

1871 147 81,994 4,736

1901 1,390 1,347,875 36,801

1905 1,657 1,774,072 46,747

1908 1,922 2,256,783 57,995

1909 1,953 2,302,910 58,451

More than in 187, 1,806 2,221,005 53,715

Not only had the number of steamships greatly increased, their tonnage had increased more still, but, ill proportion to this increase the number of the crew had decreased. In 1871 a steamship had an average tonnage of 558 tons and a crew of 32.1 men. In 1909 it had an average freight capacity of 1230 tons and a crew of only 29 men.

The rapid increase of motor power employed is another symptom of capitalistic development. In the territory of the German “Zollverein,” according to Viebahn, 99,761, horse-power were used in 1861.[2] In 1875, in Germany, factories employing more than five persons, used, 1,055,750 horse-power, and in 1895, 2,933,526 horsepower, almost three times the number used in 1875. Railroads, street cars and steamboats are not contained in this list.

The following list shows the amount of horse-power used in Prussia:

Stationary steam engines Movable boilers and traction engines

1879 888,000 47,000

1896 2,534,900 159,400

1900 3,461,700 229,600

1905 4,684,900 315,200

1906 4,995,700 334,400

1907 5,190,400 363,200

So the amount of horse-power employed in Prussia in 1907 is six times greater than in 1879. How tremendously industry has developed since the census of 1895 can be seen by the fact that the number of stationary engines in Prussia has increased by 35 per cent. from 1896 to 1907. The productiveness of the machines has increased by 105 per cent. during this period. While, in 1898, 3,305 steam engines of 258,726 horse-power served to run dynamos, there are 6,191 of 954,945 horse-power in 1907. That is an increase of 87 and 269 per cent.[3] The following figures show the increased application of steampower in the most important industries (expressed in horsepower) :

Industry 1879 1897 1907

Mining and foundries 516,000 1,430,000 2,284,000

Masonry and bricks 29,000 132,000 255,000

Metallurgy 23,000 57,000 113,000

Machines 22,000 61,000 329,000

Textile 88,000 243,000 323,000[4]

Notwithstanding this fabulous development of the productive powers and the immense concentration of capital, attempts are still being made to deny these truths. Such an attempt was made at the eleventh session of the International Institute of Statistics in Copenhagen in August, 1907, by the French economist, Ives Guyot. On the basis of careless statistics, he moved to abolish the word “concentration” from statistics. Among others, Carl Buecher answered him as follows: “An absolute increase in the number of manufactories may easily coincide with a concentration of same. Wherever the census enumerates individual establishments, it is unavoidable that many should be counted twice. A bank with 100 trust-funds is counted as 101 ; a brewery that has opened and fitted out 50 saloons, is counted as 51 establishments. The results of such statistics prove nothing in regard to the phenomenon in question. Investigation so far shows that agriculture alone does not seem to be subjected to the process of concentration. It is evident in mining, commerce, transportation, building trades and insurance. In industry it is difficult to recognize, because every civilized nation in a healthy state of development must present an extension of industrial production, for the following four reasons: 1. Because occupations that were formerly domestic in character have been taken over by industry :2. Because natural products have been replaced by industrial products (wood by iron; woad, madder and indigo by tar-colors, etc.). 3. Because of new inventions (automobiles). 4. Because of the possibility of exportation. For these reasons concentration on a large scale takes place in industry without any diminution in the number of establishments, even with an in. crease in same. Wherever industry creates commodities ready for use of a typical character, the destruction of the independent small concerns is inevitable. The capitalistic forms of production are accordingly rapidly developing in the most important lines of industry. It is not wise to oppose the Socialists where they are right, and they are undoubtedly right in their assertions in regard to increasing concentration.” [5]

The same aspect presented by the economic develop merit of Germany is presented by all the industrial states of the world. All the civilized states endeavour to become industrial states more and more. They not only seek to manufacture articles of industry to supply their own demand, but also to export them. Therefore we not only speak of a national market, but also of the world market. The world market regulates the prices of countless articles of industry and agriculture and controls the social status of the nations. That industrial realm which has attained the greatest importance in regard to the relations of the world market, is the North American Union. Here the main impetus is giver. whereby the world market and bourgeois society are revolutionized. The census of the last three decades showed the following figures:

Amount of capital invested in industry.

1880 2,790,000,000 dollars

1890 6,525,000,000

1900 9,813,000,000

Value of Industry.

1880 5,369,000,000 dollars

1890 9,372,000,000

1900 13,000,000,000

The United States, accordingly, is the leading industrial country of the world. Its exportation of products of industry and agriculture increase with each year, and the tremendous accumulations of capital that are a natural result of this development seek investment beyond the boundaries of the country, and influence the industry and trade of Europe to a marked degree. It is no longer the individual capitalist who is the motive power underlying this development. It is the group of captains of industry, the trust, that is bound to crush the most powerful individual enterprise, wherever it chooses to turn its activities. What can the small man amount to in the face of such development, to which even the great must yield?

3. – Concentration of Wealth.

It is an economic law that, with the concentration of industry and its increased productivity, the number of workers employed relatively decreases, while the wealth of a nation, in proportion to the entire population, becomes concentrated in fewer hands. That can be clearly seen by the distribution of the income in various civilized countries.

Of the larger German states, Saxony possesses the oldest and best statistics on the income tax. The present law is in force since 1879. But it is advisable to take a later year, because during the first years the assessments were, on an average, too low. The population of Saxony increased by 51 per cent. from 1880 to 1905. The number of persons assessed increased by 160 per cent from 1882 to 1904; the assessed income by 23 per cent. Until the beginning of the nineties an income up to 300 marks per annum was exempt from taxation, after that up to 4,000 marks. In 1882 the number of persons exempt from taxes were 75,697 = 6.61 per cent.; in 1904, 205,667 = 11.03 per cent. It must be noted that, in Saxony, the incomes of wives and of members of the family under 16 are added to the income of the husband and father. The taxpayers having an income from 400 to 800 marks formed 48 per cent. of those assessed in 1882; in 1904 only 43.81 per cent. A part of them had advanced into a class with a higher income. The average income of the taxpayers of this class had increased by 37 per cent – from 421 to 582 marks – during this period, but still remained behind the average of 600 marks. The taxpayers having an income from 800 to 1,250 marks formed 12 per cent of those assessed in 1882, and 24.38 per cent in 1904. But those with an income from 1,250 to 3,300 marks formed 20 per cent in 1882 and only 16.74 per cent in 1904. In 1863 Lassalle computed that only 4 per cent of all incomes in Prussia were over 3,000 marks annually. When we consider that, in the meantime, rents, taxes and the cost of living have increased, and that the demands in regard to the standard of living have grown, it becomes evident that the position of the masses has relatively scarcely improved. The medium incomes of from 3,400 to 10,000 marks in 1904 formed only 3.24 per cent. of those assessed, and the incomes of over 10,000 marks less than 1 per cent. The number of taxpayers with incomes from 12,000 to 20,000 marks, 0.80 per cent. The number of incomes of over 12,000 marks has increased from 4,124, in 1882, to 11,771, in 1904; that is, by 185 per cent. The highest income in 1882 was 2,570,000 marks; in 1906, 5,900,600 marks. These figures show the following facts: The lower incomes have increased somewhat, but in many cases this increase has been more than equalized by the increased cost of living. The middle classes experienced the least improvement; but the number and the income of the richest people show the greatest increase. Accordingly the class extremes became more marked.

In his investigations of the distribution of income in Prussia from 1892 to 1902, Professor Adolf Wagner has, ascertained the following facts. He divides the population of Prussia into three large groups: The lower group (lowest up to 420 marks; medium, 4.20 to 900; highest, 900 to 2,100); the middle group (lowest, 2,100 to 3,000; medium, 3,000 to 6,000; highest, 6,000 to 9,500 marks) the upper group (lowest from 9,500 to 30,500; medium, 30,500 to 100,000 and highest over 100,000). The entire income is divided almost equally among these three groups. The 3.51 per cent. of the upper group control 32.1 per cent of the entire income. The lower group, including the 70.66 per cent of those exempt from taxation, also controls an income of 32.9 per cent of the entire income; and the middle group, with 25.83 per cent controls 34.9 per cent of the entire income. If we take into consideration only those incomes that are subject to taxation, we find that all those having an income from 900 to 3,000 marks, who formed 86.99 per cent of those enumerated in 1892, and 88.04 per cent, in 1902, controlled over half of the assessable income, 51.05 per cent, in 1892, and 52.1 per cent in 1902. Incomes of over 3,000 marks, which formed, respectively, 13 and 12 per cent of those enumerated, controlled about 49 per cent of the entire assessable income in 1892 and 48 per cent in 1902. The average income of the small taxpayers throughout Prussia amounted to 1,374 in 1892 and to 1,348 in 1902; it had, accordingly, diminished to 1.89 per cent. On the other hand the average income of the large taxpayers has increased from 8,811 marks, in 1892, to 9,118 marks, in 1902, or by 3.48 per cent. Upon the upper group, which formed only 0.5 per cent. of all those enumerated in 1892 and 0.63 per cent. in 1902, 15.95 percent of the entire income devolved in 1892, and 18.37 per cent in 1902. The increase is slightest with the lowest and medium class of the middle group. It is somewhat greater with the highest class of the lower group. But it is greatest and increasingly great from class to class, with the highest class of the middle group and with the entire upper group. The greater the income of a group of those enumerated, the richer they are; the more, accordingly, their number relatively increases. The number of those having high and highest incomes increases, who, on an average, also attain increasingly large incomes. In other words, a growing concentration of incomes takes place, not only among particularly rich individuals, but among the economically high and highest group of the population, that is rapidly growing and yet comprises a relatively small number. “This shows that the modern economic development has indeed been favorable to the entire population by increasing the income and by increasing the number of members of each economic-social class, but that the distribution has been a very uneven one, the rich being mostly favored, then the lower classes, and the middle class least. It shows, accordingly. that the social class differences, inasmuch as they depend upon the size of the income, have increased.” [6]

The Prussian income-tax assessments of 1908 show that there were 104,904 taxpayers with an income of more than 9,500 marks, representing a total income of 3,123,273,000 marks. Among these were 3,796 with an income of more than 100,000 marks, representing a total income of 934,000,000 marks; 77 were enumerated with an income of more than a million. The 104,904 taxpayers, or 1.78 per cent, with an income of more than 9,500 marks, represented the same total income as the 3,109,540 (52.9 per cent), with an income of from 900 to 1,350 marks.

In Austria about 24 per cent of the assessed net income devolved upon approximately 12 to 13 per cent of the taxpayers having incomes of from 4,000 to 12,000 crowns. If the incomes up to 12,000 crowns are taken together, this group comprises over 97 per cent of the taxpayers and 74 per cent of the income. The remaining 3 per cent of the taxpayers control 26 per cent of the assessed income.[7] The minimum exempt from taxation is higher in Austria than in Prussia – 1,200 crowns, or 1,014 marks. The small taxpayers having an income of from 1,200 to 4,000 crowns formed 84.3 [per cent] of all taxpayers in 1904. The number of richest persons having an income of more than 200,000 crowns was 255 in 1898, and in 1904 it was 307, or 0.032 per cent of all taxpayers.

In Great Britain and Ireland, according to L. G. Chiozza Money, half of the national income (over 4,150,000,000 dollars) belongs to one-ninth of the population. He divides the population into three groups: The rich, with an income of more than 700 pounds sterling; the wealthy, with an income of from 160 to 700 pounds sterling; and the poor, with an income of less than 160 pounds sterling.

Class Persons Including families Income in pounds sterling

Rich 250,000 1,250,000 585,000,000

Wealthy 750,000 3,750,000 245,000,000

Poor 5,000,000 38,000,000 880,000,000

According to these figures, more than one-third of the national income belongs to one-thirtieth of the population. The investigations of Booth for London, and of Rowntree for York, have shown that thirty per cent of the entire population lead an existence of direst life-long poverty.[8]

For France, E. Levasseur compiled the following figures, on the basis of the statistics of inheritance: “Two-fifths of the national wealth are owned by 98 per cent having less than 100,000 francs; about one-third is owned by a small group of 1.7 per cent, and a quarter of the entire national wealth belongs to a wee minority – 0.12 per cent.”[9]

All these figures show how great are the numbers of the non-possessing masses, and how thin the strata of the possessing classes.

“The growing inequality,” says G. Schmoller, “is undeniable. It cannot be doubted that the distribution of wealth in Central Europe, from 1300 to 1900, became increasingly unequal, though of course the inequalities varied in the different countries. Recent development, with its growing class distinctions, has greatly increased the inequalities in income and wealth.”[10]

This capitalistic process of development and concentration, that takes place in all civilized countries, combined with the prevailing anarchy in the methods of production, that so far was unable to prevent the formation of trusts, inevitably leads to overproduction and to an overstocking of the market. We enter upon the crisis.


1. Otto Hué – “History of the development of the mining industries.”

2. A. Hesse – “Statistics of Trade.”

3. A. Hesse – “Statistics of Trades.”

4. Prof. Dr. S. Reyer Kraft – “Economic, Technical and Historical Studies in the Development of the Power of States.”

5. “Bulletin de l'institut international de statistique.” Copenhagen.

6. Adolf Wagner – “A contribution to the method of statistics of the national income and national wealth and further statistic investigations of the distribution of the national income in Prussia, founded on the new income statistics, 1892-1902.” “Gazette of the royal Prussian bureau of statistics,” 1904.

7. F. L. – “The distribution of the income in Austria.” Leipzig, 1908.

8. L. G. Chiozza Money, “Riches and Poverty.” London, 1908.

9. E. Levasseur.

10. G. Schmoller – “Principles of Economics.” Vol. II.