Cotton and Iron (1881)
Published: No. 13, July 30, 1881, as a leading article in The Labour Standard
Source: Reproduced from the newspaper
Cotton and iron are the two most important raw materials of our time. Whichever nation is the leading one in the manufacture of cotton and iron articles, that nation heads the list of manufacturing nations generally. And because and as long as this is the case with England, therefore and so long will England be the first manufacturing nation of the world.
It might, then, be expected that the workers in cotton and iron should be remarkably well off in England; that, as England commands in the market, trade in these articles should be always good, and that at least in these two branches of industry the millennium of plenty, promised at the time of the Free Trade agitation,  should be realised. Alas! we all know that this is far from being the case, and that here, as in other trades, if the condition of the workpeople has not become worse, and in some instances even better, it is due exclusively to their own efforts -- to strong organisation and hard-fought strikes. We know that after a few short years of prosperity about and after 1874 there was a complete collapse of the cotton and iron trades ; factories were closed, furnaces blown out, and where production was continued short time was the rule. Such periods of collapse had been known before; they recur, on an average, once in every ten years; they last their time, to be relieved by a new period of prosperity, and so on.
But what distinguishes the present period of depression especially in cotton and iron is this, that it has now for some years outlasted its usual duration. There have been several attempts at a revival, several spurts; but in vain. If the epoch of actual collapse has been overcome, trade remains in a languid state, and the markets continue incapable to absorb the whole production.
The cause of this is that with our present system of using machinery to produce not only manufactured goods, but machines themselves, production can be increased with incredible rapidity. There would be no difficulty, if manufacturers were so minded, during the single period of prosperity to increase the plant for spinning and weaving, bleaching and printing cotton, so as to be able to produce fifty per cent more goods, and to double the whole production of pig-iron and iron articles of every description. The actual increase has not come up to that. But still it has been out of all proportion to what it was in former periods of expansion, and the consequence is -- chronic over-production, chronic depression of trade. The masters can afford to look on, at least for a considerable time, but the workpeople have to suffer, for to them it means chronic misery and a constant prospect of the workhouse. 
This, then, is the outcome of the glorious system of unlimited competition, this the realisation of the millennium promised by the Cobdens, Brights, and Co.! This is what the workpeople have to go through if, as they have done for the last twenty-five years, they leave the management of the economical policy of the empire to their "natural leaders", to those "captains of industry" who, according to Thomas Carlyle, were called upon to command the industrial army of the country. Captains of industry indeed! Louis Napoleon's generals in 1870 were geniuses compared to them. Everyone of these pretended captains of industry fights against every other, acts entirely on his own account, increases his plant irrespective of what his neighbours do, and then at the end they all find, to their great surprise, that overtrading has been the result. They cannot unite to regulate production; they can unite for one purpose only: to keep down the wages of their workpeople. And it thus, by recklessly expanding the productive power of the country far beyond the power of absorption of the markets, they rob their workpeople of the comparative ease which a period of moderate prosperity would give them, and which they are entitled to after the long period of collapse, in order to bring up their incomes to the average standard. Will it not yet be understood that the manufacturers, as a class, have become incapable any longer to direct the great economical interests of the country, nay, even the process of production itself? And is it not an absurdity -- though a fact -- that the greatest enemy to the working people of England is the ever-increasing productivity of their own hands?
But there is another fact to be taken into consideration. It is not the English manufacturers alone who increase their productive powers. The same takes place in other countries. Statistics will not allow us to compare separately the cotton and iron industries of the various leading countries. But, taking the whole of the textile, mining, and metal-working industries, we can draw up a comparative table with the materials furnished by the chief of the Prussian Statistical Bureau, Dr. Engel, in his book, "Des Zeitalter des Dampfs" (The Age of Steam, Berlin, 1881). According to his computation, there are employed in the above industries in the countries stated below steam-engines of the following total horse-power (one horse-power equal to a force lifting 75 kilogrammes to the height of one metre in one second), viz:
Textile Mining and Industries Metal Works
England, 1871 515,800 1,077,000 h.p.
Germany, 1875 128,125 456,436 h.p.
France about 100,000 185,000 h.p.
United States about 93,000 370,000 h.p
Thus we see that the total steam power employed by the three nations who are England's chief competitors amounts to three-fifths of the English steam power in the textile manufactures, and nearly equals it in mines and metal works. And as their manufactures progress at a far more rapid rate than those of this country, there can be scarcely a doubt that the combined produce of the former will soon surpass that of the latter.
Look, again, at this table, giving the steam horse-power employed in production, exclusive of locomotives and ships' engines: --
Great Britain About 2,000,000
United States About 1,987,000
Germany About 1,321,000
France About 492,000
This still more clearly shows how little there is left of the monopoly of England in steam manufactures, and how little Free Trade has succeeded in securing England's industrial superiority. And let it not be said that this progress of foreign industry is artificial, is due to protection. The whole of the immense expansion of the German manufactures has been accomplished under a most liberal Free Trade régime, and if America, owing to an absurd system of internal excise  more than anything else, is compelled to have recourse to a protection more apparent than real, the repeal of these excise laws would be sufficient to allow her to compete in the open market.
This, then, is the position in which twenty-five years of an almost absolute reign of Manchester School  doctrines have left the country. We think these results are such as to call for a speedy abdication of the Manchester and Birmingham gentlemen, so as to give the working classes a turn for the next twenty-five years. Surely they could not manage worse.
- This refers to the activities of the Anti-Corn Law League.
- In 1873-78, England entered the period of "great depression", a profound industrial crisis aggravated by the agrarian crisis, which lasted until the mid-1890s. The year 1874 witnessed a drop in the production of coal and iron ore. In 1875, the output of the cotton industry also decreased.
- The Poor Law adopted in England in 1834 provided for only one form of relief for the able-bodied poor workhouses with a prison-like regime in which the workers were engaged in unproductive, monotonous and exhausting labour. The people called the workhouses "Bastilles for the poor".
- The system of internal excise -- one of the main types of indirect taxes, mostly on everyday essentials (salt, sugar, coffee, matches, etc.), as well as municipal, transport and other widely used services. It is included in the price of goods or service tariff, and is thus shifted onto the consumer. Excise duty is an important source of revenue for the state budget in the capitalist countries.
In the USA each state has its own excise system, covering cigarettes, alcohol and petrol. The first excise on whisky was introduced in the USA on March 3, 1791.
- The Manchester School -- a trend in economic thinking which reflected the interests of the industrial bourgeoisie. Its supporters, known as Free Traders, advocated removal of protective tariffs and non-intervention by the government in economic life. The centre of the Free Traders' agitation was Manchester, where the movement was headed by two textile manufacturers, Richard Cobden and John Bright. In the 1840s and 1850s, the Free Traders were a separate political group, which later formed the Left wing of the Liberal Party.