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to identify the members of the body engaged in a certain kind of labor, and undertake to show the parts of the produce which go severally to the hand, the eye, and the foot. It is true that we find men laboring, generally at reduced wages, who have lost one or both hands, one or both eyes, one or both feet; and the economist may, by judicious inquiry, satisfy himself how much these unfortunate persons lose in wages by their several infirmities. But this would not be held to justify the extension of such an analysis or dissection to the vastly greater number of sound laborers, and the erection of a system of distribution based on the respective contributions of the several parts of the undivided body to the work of production.
Now, as matter of fact, although labor is a function in production which is always separable in idea from the work of capital, the instances where capital is furnished by one person and labor performed wholly by a different person are, if we look over the world, fewer1 by far than those in which capital is furnished more or less by those who perform the labor, and in which labor is performed more or less by those who furnish the capital. In other words, it is not the rule, but the exception, that one or the other industrial function shall characterize the industrial person or class, just as, notwithstanding all the effects of malicious and accidental injury, the number of those who preserve all their organs and members exceeds the number of the maimed, the halt, and the blind.
Yet the great body of systematic writers in political economy have carried the classification which resulted from their analysis of the processes of production over, without change, into the discussion of the questions of distribution; and having found labor and capital the two agents in production, have proceeded to speak of the remuneration of labor and the remuneration of capital, as if labor
and capital did in fact receive shares always distinct in the distribution of wealth.
Now it is easy to show that the term Labor, according to this use of it, includes the part in industry of five classes of persons clearly separable in economical idea, and generally to be distinguished clearly in life, namely: 1st, the class who work for themselves, by themselves, either on their own land (the “ peasant proprietor” of Europe, and the American “farmer') or in mechanical trades. This class may consume their own products entire, 1 or exchange them in a greater or less degree, but in either case there is no distribution. 2d, the tenant occupier of land, like the cottar of Ireland or the ryot of India, who receives the whole produce, subject only to the deduction of rent for the natural powers of the soil. 3d, the class of persons working for hire (e. g., domestic servants, soldiers, clergymen) who are paid out of the revenue of their employers, and are not employed with any reference to the profits of production. 4th, the class of persons working for hire, whether in agriculture, in trade, or in mechanical pursuits, who are paid out of the product of their industry, and are employed with reference to the profits of production.
1 Throughout the present discussion I shall waive all question of the amount derived by the government from taxation. Whether taxes be, as Professor Senior claims (Pol. Econ., p. 182-5)," a form of expenditure,” and hence only cognizable in the department of Consumption, it is not needful to decide here. Suffice it to say that even though government were to be regarded as, in a certain sense, a partner in the production of wealth, and a sharer in its distribution, yet, inasmuch as government always enters by force and carries away its part, determining for itself alike how much it will take and to what use it will apply what it takes, political economy can know nothing of it. As the laws are silent amid arms, economical science bows before the tax-gatherer. Whether government shall take much or little for its own purposes out of the wealth that has been pro duced is the business, not of the economist, but of the statesman. The methods and subjects of taxation do come within the field of political economy, but it is only because they affect the production of future wealth, its distribution, its exchange.
5th, the employers themselves, in so far as they personally conduct and control business operations, their remuneration being styled the “ wages of supervision and management.”
Now to the remuneration of each of these five classes the economists generally, as I have said, apply the term Wages, although only the third and fourth classes do in fact receive a remuneration for their services distinct from that which they receive for the use of their capital ; being therefore the only classes which receive “wages” in the ordinary meaning of that word ; and although, in the second place, classes 4 and 5 thus grouped have interests as strongly opposed as human interests can well become.
The explanation of such a classification would fairly seem to be that which has been indicated, namely, that economists have assumed as of course that the industrial functions which they distinguish in the production of wealth will necessarily characterize the industrial classes interested in the distribution of wealth. Otherwise it would scarcely be possible that a classification should be seriously proposed, for the solution of the problems of distribution, which groups together employer and employed; the peasant proprietor, the tenant occupier, and the hired agricultural hand; the navvy and the railroad king; the day-laborer and the domestic servant with a Stewart, an Astor, and a Rothschild.
It is true that labor, in a certain sense of that word, is common to these and all other classes in production; and this fact of itself ought to be enough to show that it is not labor which should be taken to distinguish classes in distribution. It is not what these classes have in common, but those things by which they differ from each other, which should be made the means of characterizing them as claimants to the product of industry.
It might fairly be expected that after insisting thus peremptorily that the question of Wages is a question in the
Distribution of Wealth, and that, in distribution, not industrial functions, but industrial classes, should be considered, one would in a treatise on Wages at once proceed to state the problem of distribution, and to define the wages class as a party thereto. But, on the contrary, I shall be obliged to take up and explain with much particularity certain principles of Production and Population which can not safely be assumed for our present purposes, and also to deal at some length with a current theory respecting the remuneration of labor, which squarely blocks the way to a philosophy of Wages.
NOMINAL AND REAL WAGES.
A DISTINCTION which needs to be apprehended with great clearness and held strongly in the mind, throughout all discussion of Wages, is that between Nominal and Real Wages.
Real Wages are the remuneration of the hired laborer as reduced to the necessaries, comforts, or luxuries of life. These are what the laborer works for; these are truly his wages. The money he receives under his contract with his employer is only a means to that end ; sometimes, as it proves, a most delusive means. If, as is the case with the great majority of his class, he spends every week or every month his entire earnings, he can see for himself, no matter how little given to reflection, that his wages are not his money, but what his money brings. If, again, he is frugal and forehanded enough to save a portion of his wages, and hoard it up or put it out at interest, it is still true, though not perhaps so evident, that this portion of his wages also means, in some near or distant future,“ food, clothing, lodging, and firing” to himself or to his family. The habitual miser, the person who loves money for its own sake, is one of the most exceptional of human beings, the victim, doubtless, of a distinct form of disease as truly as the subject of alcoholism.
But this reduction of Nominal to Real Wages is not an easy matter. “No one,” says Mr. G. R. Porter in his Progress of the Nation, “unless he shall have made the at