Articles by Engels in the Labour Standard 1881

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The Wages Theory of the Anti-Corn Law League

Source: Reproduced from the newspaper;
Written: beginning of July 1881;
Published: No. 10, July 9, 1881, as a leading article;
Transcribed:, Labor Day 1996.

In another column we publish a letter from Mr. J. Noble finding fault with some of our remarks in a leading article of the' Labour Standard of June 18. Although we cannot, of course, make our leading columns the vehicle of polemics on the subject of historical facts or economic theories, we will yet, for once, reply to a man who, though in an official party position, is evidently sincere.

To our assertion that what was aimed at by the repeal of the Corn Laws was to "reduce the price of bread and thereby the money rate of wages", Mr. Noble replies that this was a "Protectionist fallacy" persistently combated by the League, and gives some quotations from Richard Cobden's speeches and an address of the Council of the League to prove it. [1]

The writer of the article in question was living at the time in Manchester -- a manufacturer amongst manufacturers. [2] He is, of course, perfectly well aware of what the official doctrine of the League was. To reduce it to its shortest and most generally recognised expression (for there are many varieties) it ran thus: -- The repeal of the duty on corn will increase our trade with foreign countries, will directly increase our imports, in exchange for which foreign customers will buy our manufactures, thus increasing the demand for our manufactured goods; thus the demand for the labour of our industrial working population will increase, and therefore wages must rise. And by dint of repeating this theory day after day and year after year the official representatives of the League, shallow economists as they were, could at last come out with the astounding assertion that wages rose and fell in inverse ratio, not with profits, but with the price of food; that dear bread meant low wages and cheap bread high wages. Thus, the decennial revulsions of trade which have existed before and after the repeal of the Corn duties were, by the mouthpieces of the League, declared to be the simple effects of the Corn Laws, bound to disappear as soon as those hateful laws were removed; that the Corn Laws were the only great obstacle standing between the British manufacturer and the poor foreigners longing for that manufacturer's produce, unclad and shivering for want of British cloth. And thus Cobden could actually advance, in the passage quoted by Mr. Noble, that the depression of trade and the fall in wages from 1839 to 1842 was the consequence of the very high price of corn during these years, when it was nothing else but one of the regular phases of depression of trade, recurring with the greatest regularity, up to now, every ten years; a phase certainly prolonged and aggravated by bad crops and the stupid interference of greedy landlord legislation.

Well, this was the official theory of Cobden, who with all his cleverness as an agitator was a poor business man and a shallow economist; he no doubt believed it as faithfully as Mr. Noble believes it to this day. But the bulk of the League was formed of practical men of business, more attentive to business and generally more successful in it than Cobden. And with these matters were quite different. Of course, before strangers and in public meetings, especially before their "hands", the official theory was generally considered "the thing". But business men, when intent upon business, do not generally speak their mind to their customers, and if Mr. Noble should be of a different opinion, he had better keep off the Manchester Exchange. A very little pressing as to what was meant by the way in which wages must rise in consequence of free trade in corn, was sufficient to bring it out that this rise was supposed to affect wages as expressed in commodities, and that it might be quite possible that the money rate of wages would not rise -- but was not that substantially a rise of wages? And when you pressed the subject further it usually came out that the money rate of wages might even fall while the comforts supplied for this reduced sum of money to the working man would still be superior to what he enjoyed at the time. And if you asked a few more close questions as to the way, how the expected immense extension of trade was to be brought about, you would very soon hear that it was this last contingency upon which they mainly relied: a reduction in the money rate of wages combined with a fall in the price of bread, etc., more than compensating for this fall. Moreover, there were plenty to be met who did not even try to disguise their opinion that cheap bread was wanted simply to bring down the money rate of wages, and thus knock foreign competition on the head. And that this, in reality, was the end and aim of the bulk of the manufacturers and merchants forming the great body of the League, it was not so very difficult to make out for any one in the habit of dealing with commercial men, and therefore in the habit of not always taking their word for gospel. This is what we said and we repeat it. Of the official doctrine of the League we did not say a word. It was economically a "fallacy", and practically a mere cloak for interested purposes, though some of the leaders may have repeated it often enough to believe it finally themselves.

Very amusing is Mr. Noble's quotation of Cobden's words about the working classes "rubbing their hands with satisfaction" at the prospect of corn at 25s. a quarter. The working classes at that time did not disdain cheap bread; but they were so full of "satisfaction" at the proceedings of Cobden and Co. that for several years past they had made it impossible for the League in the whole of the North to hold a single really public meeting. The writer had the "satisfaction" of being present, in 1843, at the last attempt of the League to hold such a meeting in Salford Town Hall, and of seeing it very nearly broken up by the mere putting of an amendment in favour of the People's Charter. [3] Since then the rule at all League meetings was "admission by ticket", which was far from being accessible to everyone. From that moment "Chartist obstruction" ceased. The working masses had attained their end -- to prove that the League did not, as it pretended, represent them.

In conclusion, a few words about the wages theory of the League. The average price of a commodity is equal to its cost of production; the action of supply and demand consists in bringing it back to that standard around which it oscillates. If this be true of all commodities, it is true also of the commodity Labour (or more strictly speaking, Labour-force). Then the rate of wages is determined by the price of those commodities which enter into the habitual and necessary consumption of the labourer. In other words, all other things remaining unchanged, wages rise and fall with the price of the necessaries of life. This is a law of political economy against which all the Perronet Thompsons, Cobdens, and Brights will ever be impotent. But all other things do not always remain unchanged, and therefore the action of this law in practice becomes modified by the concurrent action of other economical laws; it appears darkened, and sometimes to such a degree that you must take some trouble to trace it. This served as a pretext to the vulgarising and vulgar economists dating from the Anti-Corn Law League to pretend, first, that Labour, and then all other commodities, had no real determinable value, but only a fluctuating price, regulated by supply and demand more or less without regard to cost of production, and that to raise prices, and therefore wages, you had nothing to do but increase the demand. And thus you got rid of the unpleasant connection of the rate of wages with the price of food, and could boldly proclaim that in this crude, ridiculous doctrine that dear bread meant low wages and cheap bread high wages.

Perhaps Mr. Noble will ask whether wages are not generally as high, or even higher, with to-day's cheap bread than with the dear taxed bread before 1847? That would take a long inquiry to answer. But so much is certain: where a branch of industry has prospered and at the same time the workmen have been strongly organised for defence, their wages have generally not fallen, and sometimes perhaps risen. This merely proves that the people were underpaid before. Where a branch of industry has decayed, or where the workpeople have not been strongly organised in Trades Unions, these wages have invariably fallen, and often to starvation level. Go to the East-end of London and see for yourselves!

From the MECW

1 In his letter John Noble quotes Richard Cobden's speeches in the House of Commons made on February 24, 1842 (see Hansard's Parliamentary Debates. Third series, Vol. 60, London, 1842, p. 1045) and February 27, 1846 (ibid., Vol. 84, London, 1846, pp. 285-86), as well as the address of the Anti-Corn Law League adopted by it at the Manchester meeting on August 20, 1842 and printed by The Times, No. 18069, August 23, 1842.

2 Engels was living in Manchester from December 1842 to late August 1844, where he studied commerce at the cotton mill belonging to the Ermen & Engels firm.

3 Engels describes his participation in the meeting of the Anti-Corn Law League in Salford in 1843 in his "Letters from London (1)".

The People's Charter, which contained the demands of the Chartists, was published in the form of a Parliamentary Bill on May 8, 1838. It contained six points: universal suffrage (for men of 21 and over), annual Parliaments, vote by ballot, equal electoral districts, abolition of the property qualification for MPs and payment of MPs. Petitions urging the adoption of the People's Charter were turned down by Parliament in 1839, 1842 and 1848.