On the Question of Free Trade

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On the Question of Free Trade
by Karl Marx, translated by Friedrich Engels
Karl Marx speaking before the Democratic Association of Brussels on January 9, 1848 about free trade.

Gentlemen,

The Repeal of the Corn Laws in England is the greatest triumph of free trade in the 19th century. In every country where manufacturers talk of free trade, they have in mind chiefly free trade in corn and raw materials in general. To impose protective duties on foreign corn is infamous, it is to speculate on the famine of peoples.

Cheap food, high wages, this is the sole aim for which English free-traders have spent millions, and their enthusiasm has already spread to their brethren on the Continent. Generally speaking, those who wish for free trade desire it in order to alleviate the condition of the working class.

But, strange to say, the people for whom cheap food is to be procured at all costs are very ungrateful. Cheap food is as ill-esteemed in England as cheap government is in France. The people see in these self-sacrificing gentlemen, in Bowring, Bright and Co., their worst enemies and the most shameless hypocrites.

Everyone knows that in England the struggle between Liberals and Democrats takes the name of the struggle between Free-Traders and Chartists.

Let us now see how the English free-traders have proved to the people the good intentions that animate them.

This is what they said to the factory workers:

"The duty levied on corn is a tax upon wages; this tax you pay to the landlords, those medieval aristocrats; if your position is wretched one, it is on account of the dearness of the immediate necessities of life."

The workers in turn asked the manufacturers:

"How is it that in the course of the last 30 years, while our industry has undergone the greatest development, our wages have fallen far more rapidly, in proportion, than the price of corn has gone up?

"The tax which you say we pay the landlords is about 3 pence a week per worker. And yet the wages of the hand-loom weaver fell, between 1815 and 1843, from 28s. per week to 5s., and the wages of the power-loom weavers, between 1823 and 1843, from 20s. per week to 8s.

"And during the whole of this period that portion of the tax which we paid to the landlord has never exceeded 3 pence. And, then in the year 1834, when bread was very cheap and business going on very well, what did you tell us? You said, 'If you are unfortunate, it is because you have too many children, and your marriages are more productive than your labor!'

"These are the very words you spoke to us, and you set about making new Poor Laws, and building work-houses, the Bastilles of the proletariat."

To this the manufacturer replied:

"You are right, worthy laborers; it is not the price of corn alone, but competition of the hands among themselves as well, which determined wages.

"But ponder well one thing, namely, that our soil consists only of rocks and sandbanks. You surely do not imagine that corn can be grown in flower-pots. So if, instead of lavishing our capital and our labor upon a thoroughly sterile soil, we were to give up agriculture, and devote ourselves exclusively to industry, all Europe would abandon its factories, and England would form one huge factory town, with the whole of the rest of Europe for its countryside."

While thus haranguing his own workingmen, the manufacturer is interrogated by the small trader, who says to him:

"If we repeal the Corn Laws, we shall indeed ruin agriculture; but for all that, we shall not compel other nations to give up their own factories and buy from ours.

"What will the consequence be? I shall lose the customers that I have at present in the country, and the home trade will lose its market."

The manufacturer, turning his back upon the workers, replies to the shopkeeper:

"As to that, you leave it to us! Once rid of the duty on corn, we shall import cheaper corn from abroad. Then we shall reduce wages at the very time when they rise in the countries where we get out corn.

"Thus in addition to the advantages which we already enjoy we shall also have that of lower wages and, with all these advantage, we shall easily force the Continent to buy from us."

But now the farmers and agricultural laborers join in the discussion.

"And what, pray, is to become of us?

"Are we going to pass a sentence of death upon agriculture, from which we get our living? Are we to allow the soil to be torn from beneath our feet?"

As its whole answer, the Anti-Corn Law League has contented itself with offering prizes for the three best essays upon the wholesome influence of the repeal of the Corn Laws on English agriculture.

These prizes were carried off by Messrs. Hope, Morse, and Greg, whose essays were distributed in thousands of copies throughout the countryside.

The first of the prize-winners devotes himself to proving that neither the tenant farmer nor the agricultural laborer will lose by the free importation of foreign corn, but only the landlord.

"The English tenant farmer," he exclaims, "need not fear the repeal of the Corn Laws, because no other country can produce such good corn so cheaply as England.

"Thus, even if the price of corn fell, it would not hurt you, because this fall would only affect rent, which would go down, and not at all industrial profit and wages, which would remain stationary."

The second prize-winner, Mr. Morse, maintains, on the contrary, that the price of corn will rise in consequence of repeal. He takes infinite pains to prove that protective duties have never been able to secure a remunerative price for corn.

In support for his assertion, he cites the fact that, whenever foreign corn has been imported, the price of corn in England has gone up considerably, and then when little corn has been imported, the price has fallen extremely. This prize-winner forgets that the importation was not the cause of the high price, but that the high price was the cause of the importation.

And in direct contradiction to his co-prize-winner, he asserts that every rise in the price of corn is profitable to both the tenant farmer and the laborer, but not to the landlord.

The third prize-winner, Mr. Greg, who is a big manufacturer and whose work is addressed to the large tenant farmers, could not hold with such stupidities. His language is more scientific.

He admits that the Corn Laws can raise rent only by raising the price of corn, and that they can raise the price of corn only by compelling capital to apply itself to land of inferior quality, and this is explained quite simply.

In proportion as population increases, if foreign corn cannot be imported, less fertile soil has to be used, the cultivation of which involves more expense and the product of this soil is consequently dearer.

There being a forced sale for corn, the price will of necessity be determined by the price of the product of the most costly soil. The difference between this price and the cost of production upon soil of better quality constitutes the rent.

If, therefore, as a result of the repeal of the Corn Laws, the price of corn, and consequently the rent, falls, it is because inferior soil will no longer be cultivated. Thus, the reduction of rent must inevitably ruin a part of the tenant farmers.

These remarks were necessary in order to make Mr. Greg's language comprehensible.

"The small farmers," he says, "who cannot support themselves by agriculture will find a resource in industry. As to the large tenant farmers, they cannot fail to profit. Either the landlords will be obliged to sell them land very cheap, or leases will be made out for very long periods. This will enable tenant farmers to apply large sums of capital to the land, to use agricultural machinery on a larger scale, and to save manual labor, which will, moreover, be cheaper, on account of the general fall in wages, the immediate consequences of the repeal of the Corn Laws."

Dr. Browning conferred upon all these arguments the consecration of religion, by exclaiming at a public meeting,

"Jesus Christ is Free Trade, and Free Trade is Jesus Christ."

One can understand that all this hypocrisy was not calculated to make cheap bread attractive to the workers.

Besides, how could the workingman understand the sudden philanthropy of the manufacturers, the very men still busy fighting against the Ten Hours' Bill, which was to reduce the working day of the mill hands from 12 hours to 10?

To give you an idea of the philanthropy of these manufacturers I would remind you, gentlemen, of the factory regulations in force in all the mills.

Every manufacturer has for his own private use a regular penal code in which fines are laid down for every voluntary or involuntary offence. For instance, the worker pays so much if he has the misfortune to sit down on a chair; if he whispers, or speaks, or laughs; if he arrives a few moments too late; if any part of the machine breaks, or he does not turn out work of the quality desired, etc., etc. The fines are always greater than the damage really done by the worker. And to give the worker every opportunity for incurring fines, the factory clock is set forward, and he is given bad raw material to make into good pieces of stuff. An overseer not sufficiently skillful in multiplying cases of infractions or rules is discharged.

You see, gentlemen, this private legislation is enacted for the especial purpose of creating such infractions, and infractions are manufactured for the purpose of making money. Thus the manufacturer uses every means of reducing the nominal wage, and of profiting even by accidents over which the worker has no control.

These manufacturers are the same philanthropists who have tried to make the workers believe that they were capable of going to immense expense for the sole purpose of ameliorating their lot. Thus, on the one hand, they nibble at the wages of the worker in the pettiest way, by means of factory regulations, and, on the other, they are undertaking the greatest sacrifices to raise those wages again by means of the Anti-Corn Law League.

They build great palaces at immense expense, in which the League takes up, in some respects, its official residence; they send an army of missionaries to all corners of England to preach the gospel of free trade; they have printed and distributed gratis thousands of pamphlets to enlighten the worker upon his own interests, they spend enormous sums to make the press favorable to their cause; they organize a vast administrative system for the conduct of the free trade movement, and they display all their wealth of eloquence at public meetings. It was at one of these meetings that a worker cried out:

"If the landlords were to sell our bones, you manufacturers would be the first to buy them in order to put them through a steam-mill and make flour of them."

The English workers have very well understood the significance of the struggle between the landlords and the industrial capitalists. They know very well that the price of bread was to be reduced in order to reduce wages, and that industrial profit would rise by as much as rent fell.

Ricardo, the apostle of the English free-traders, the most eminent economist of our century, entirely agrees with the workers upon this point. In his celebrated work on political economy, he says:

"If instead of growing our own corn... we discover a new market from which we can supply ourselves... at a cheaper price, wages will fall and profits rise. The fall in the price of agricultural produce reduces the wages, not only of the laborer employed in cultivating the soil, but also of all those employed in commerce or manufacture."

[David Ricardo, Des principes de l'economie politique et de l'impot. Traduit de l'anglais par F. S. Constancio, avec des notes explicatives et critiques par J.-B.- Say. T. I., Paris 1835, p.178-79]

And do not believe, gentlemen, that is is a matter of indifference to the worker whether he receives only four francs on account of corn being cheaper, when he had been receiving five francs before.

Have not his wages always fallen in comparison with profit, and is it not clear that his social position has grown worse as compared with that of the capitalist? Besides which he loses more as a matter of fact.

So long as the price of corn was higher and wages were also higher, a small saving in the consumption of bread sufficed to procure him other enjoyments. But as soon as bread is very cheap, and wages are therefore very cheap, he can save almost nothing on bread for the purchase of other articles.

The English workers have made the English free-traders realize that they are not the dupes of their illusions or of their lies; and if, in spite of this, the workers made common cause with them against the landlords, it was for the purpose of destroying the last remnants of feudalism and in order to have only one enemy left to deal with. The workers have not miscalculated, for the landlords, in order to revenge themselves upon the manufacturers, made common cause with the workers to carry the Ten Hours' Bill, which the latter had been vainly demanding for 30 years, and which was passed immediately after the repeal of the Corn Laws.

When Dr. Bowring, at the Congress of Economists [September 16-18, 1848; the following, among others, were present: Dr. Bowring, M.P., Colonel Thompson, Mr. Ewart, Mr. Brown, and James Wilson, editor of the Economist], drew from his pocket a long list to show how many head of cattle, how much ham, bacon, poultry, etc., was imported into England, to be consumed, as he asserted, by the workers, he unfortunately forgot to tell you that all the time the workers of Manchester and other factory towns were finding themselves thrown into the streets by the crisis which was beginning.

As a matter of principle in political economy, the figures of a single year must never be taken as the basis for formulating general laws. One must always take the average period of from six to seven years -- a period of time during which modern industry passes through the various phases of prosperity, overproduction, stagnation, crisis, and completes its inevitable cycle.

Doubtless, if the price of all commodities falls -- and this is the necessary consequence of free trade -- I can buy far more for a franc than before. And the worker's france is as good as any other man's. Therefore, free trade will be very advantageous to the worker. There is only little difficulty in this, namely, that the worker, before he exchanges his franc for other commodities, has first exchanged his labor with the capitalist. If in this exchange he always received the said franc for the same labor and the price of all other commodities fell, he would always be the gainer by such a bargain. The difficult point does not lie in proving that, if the price of all commodities falls, I will get more commodities for the same money.

Economists always take the price of labor at the moment of its exchange with other commodities. But they altogether ignore the moment at which labor accomplishes its own exchange with capital.

When less expense is required to set in motion the machine which produces commodities, the things necessary for the maintenance of this machine, called a worker, will also cost less. If all commodities are cheaper, labor, which is a commodity too, will also fall in price, and, as we shall see later, this commodity, labor, will fall far lower in proportion than the other commodities. If the worker still pins his faith to the arguments of the economists, he will find that the franc has melted away in his pocket, and that he has only 5 sous left.

Thereupon the economists will tell you:

"Well, we admit that competition among the workers, which will certainly not have diminished under free trade, will very soon bring wages into harm,only with the low price of commodities. But, on the other hand, the low price of commodities will increase consumption, the larger consumption will require increased production, which will be followed by a larger demand for hands, and this larger demand for hands will be followed by a rise in wages."

The whole line of argument amounts to this: Free trade increases productive forces. If industry keeps growing, if wealth, if the productive power, if, in a word, productive capital increases, the demand for labor,the price of labor, and consequently the rate of wages, rise also.

The most favorable condition for the worker is the growth of capital. This must be admitted. If capital remains stationary, industry will not merely remain stationary but will decline, and in this case the worker will be the first victim. He goes to the wall before the capitalist. And in the case where capital keeps growing, in the circumstance which we have said are the best for the worker, what will be his lot? He will go to the wall just the same. The growth of productive capital implies the accumulation and the concentration of capital. The centralization of capital involves a greater division of labor and a greater use of machinery. The greater division of labor destroys the especial skill of the laborer; and by putting in the place of this skilled work labor which anybody can perform, it increase competition among the workers.

This competition becomes fiercer as the division of labor enables a single worker to do the work of three. Machinery accomplishes the same result on a much larger scale. The growth of productive capital, which forces the industrial capitalists to work with constantly increasing means, ruins the small industrialist and throws them into the proletariat. Then, the rate of interest falling in proportion as capital accumulates, the small rentiers, who can no longer live on their dividends, are forced to go into industry and thus swell the number of proletarians.

Finally, the more productive capital increases, the more it is compelled to produce for a market whose requirements it does not know, the more production precedes consumption, the more supply tries to force demand, and consumption crises increase in frequency and in intensity. But every crisis in turn hastens the centralization of capital and adds to the proletariat.

Thus, as productive capital grows, competition among the workers grows in a far greater proportion. The reward of labor diminishes for all, and the burden of labor increases for some.

In 1829, there were in Manchester 1,088 cotton spinners employed in 36 factories. In 1841, there were no more than 448, and they tended 53,353 more spindles than the 1,088 spinners did in 1829. In manual labor had increased in the same proportion as the productive power, the number of spinners ought to have reaches the figure of 1,848; improved machinery had, therefore, deprived 1,100 workers of employment.

We know beforehand the reply of the economists. The men thus deprived of work, they say, will find other kinds of employment. Dr. Bowring did not fail to reproduce this argument at the Congress of Economists, but neither did he fail to supply his own refutation.

In 1835, Dr. Bowring made a speech in the House of Commons upon the 50,000 hand-loom weavers of London who for a very long time had been starving without being able to find that new kind of employment which the free-traders hold out to them in the distance.

We will give the most striking passages of this speech of Dr. Bowring:

"This distress of the weavers... is an incredible condition of a species of labor easily learned -- and constantly intruded on and superseded by cheaper means of production. A very short cessation of demand, where the competition for work is so great... produces a crisis. The hand-loom weavers are on the verge of that state beyond which human existence can hardly be sustained, and a very trifling check hurls them into the regions of starvation.... The improvements of machinery, ...by superseding manual labor more and more, infallibly bring with them in the transition much of temporary suffering.... The national good cannot be purchased but at the expense of some individual evil. No advance was ever made in manufactures but at some cost to those who are in the rear; and of all discoveries, the power-loom is that which most directly bears on the condition of the hand-loom weaver. He is already beaten out of the field in many articles; he will infallibly be compelled to surrender many more."

Further on he says:

"I hold in my hand the correspondence which has taken place between the Governor-General of India and the East-India Company, on the subject of the Dacca hand-loom weavers.... Some years ago the East-India Company annually received of the produce of the looms of India to the amount of from 6,000,000 to 8,000,000 of pieces of cotton goods. The demand gradually fell to somewhat more than 1,000,000, and has now nearly ceased altogether. In 1800, the United States took from India nearly 800,000 pieces of cotton; in 1830, not 4,000. In 1800, 1,000,000 pieces were shipped to Portugal; in 1830, only 20,000. Terrible were the accounts of the wretchedness of the poor Indian weavers, reduced to absolute starvation. And what was the sole cause? The presence of the cheaper English manufacture.... Numbers of them dies of hunger, the remainder were, for the most part, transferred to other occupations, principally agricultural. Not to have changed their trade was inevitable starvation. And at this moment that Dacca district is supplied with yarn and cotton cloth from the power-looms of England.... The Dacca muslins, celebrated over the whole world for their beauty and fineness, are also annihilated from the same cause. And the present suffering, to numerous classes in India, is scarcely to be paralleled in the history of commerce."

[ Speech in the House of Commons, July 28, 1835. (Hansard, Vol.XXIX, London 1835, pp.1168-70) ]

Dr. Bowring's speech is the more remarkable because the facts quoted by him are exact, and the phrases with which he seeks to palliate them are wholly characterized by the hypocrisy common to all free trade sermons. He represents the workers as means of production which must be superseded by less expensive means of production. He pretends to see in the labor of which he speaks a wholly exceptional kind of labor, and in the machine which has crushed out the weavers an equally exceptional machine. He forgets that there is no kind of manual labor which may not any day be subjected to the fate of the hand-loom weavers.

"It is, in fact, the constant aim and tendency of every improvement in machine to supersede human labor altogether, or to diminish its cost by substituting the industry of women and children for that of men; or that of ordinary laborers for trained artisans. In most of the water-twist, or throstle cotton-mills, the spinning is entirely managed by females of 16 years and upwards. The effect of substituting the self-acting mule for the common mule, is to discharge the greater part of the men spinners, and to retain adolescents and children."

[Dr. Andrew Ure, The Philosophy of Manufactures London 1835. Book I, Chap.I, p.23]

These words of the most enthusiastic free-trader, Dr. Ure, serve to complement the confessions of Dr. Bowring. Dr. Bowring speaks of certain individual evils, and, at the same time, says that these individual evils destroy whole classes; he speaks of the temporary sufferings during the transition period, and at the very time of speaking of them, he does not deny that these temporary evils have implied for the majority the transition from life to death, and for the rest a transition from a better to a worse condition. If he asserts, farther on, that the sufferings of these workers are inseparable from the progress of industry, and are necessary to the prosperity of the nation, he simply says that the prosperity of the bourgeois class presupposed as necessary the suffering of the laboring class.

All the consolation which Dr. Bowring offers the workers who perish, and, indeed, the whole doctrine of compensation which the free-traders propound, amounts to this:

You thousands of workers who are perishing, do not despair! You can die with an easy conscience. Your class will not perish. It will always be numerous enough for the capitalist class to decimate it without fear of annihilating it. Besides, how could capital be usefully applied if it did not take care always to keep up its exploitable material, i.e., the workers, to exploit them over and over again?

But, besides, why propound as a problem still to be solved the question: What influence will the adoption of free trade have upon the condition of the working class? All the laws formulated by the political economists from Quesnay to Ricardo have been based upon the hypothesis that the trammels which still interfere with commercial freedom have disappeared. These laws are confirmed in proportion as free trade is adopted. The first of these laws is that competition reduces the price of every commodity to the minimum cost of production. Thus the minimum of wages is the natural price of labor. And what is the minimum of wages? Just so much as is required for production of the articles indispensable for the maintenance of the worker, for putting him in a position to sustain himself, however badly, and to propagate his race, however slightly.

But do not imagine that the worker receives only this minimum wage, and still less that he always receives it.

No, according to this law, the working class will sometimes be more fortunate. It will sometimes receive something above the minimum, but this surplus will merely make up for the deficit which it will have received below the minimum in times of industrial stagnation. That is to say that, within a given time which recurs periodically, in the cycle which industry passes through while undergoing the vicissitudes of prosperity, overproduction, stagnation and crisis, when reckoning all that the working class will have had above and below necessaries, we shall see that, in all, it will have received neither more nor less than the minimum; i.e., the working class will have maintained itself as a class after enduring any amount of misery and misfortune, and after leaving many corpses upon the industrial battlefield. But what of that? The class will still exist; nay, more, it will have increased.

But this is not all. The progress of industry creates less expensive means of subsistence. Thus spirits have taken the place of beer, cotton that of wool and linen, and potatoes that of bread.

Thus, as means are constantly being found for the maintenance of labor on cheaper and more wretched food, the minimum of wages is constantly sinking. If these wages began by making the man work to live, they end by making him live the life of a machine. His existence has not other value than that of a simple productive force, and the capitalist treats him accordingly.

This law of commodity labor, of the minimum of wages, will be confirmed in proportion as the supposition of the economists, free-trade, becomes an actual fact. Thus, of two things one: either we must reject all political economy based on the assumption of free trade, or we must admit that under this free trade the whole severity of the economic laws will fall upon the workers.

To sum up, what is free trade, what is free trade under the present condition of society? It is freedom of capital. When you have overthrown the few national barriers which still restrict the progress of capital, you will merely have given it complete freedom of action. So long as you let the relation of wage labor to capital exist, it does not matter how favorable the conditions under which the exchange of commodities takes place, there will always be a class which will exploit and a class which will be exploited. It is really difficult to understand the claim of the free-traders who imagine that the more advantageous application of capital will abolish the antagonism between industrial capitalists and wage workers. On the contrary, the only result will be that the antagonism of these two classes will stand out still more clearly.

Let us assume for a moment that there are no more Corn Laws or national or local custom duties; in fact that all the accidental circumstances which today the worker may take to be the cause of his miserable condition have entirely vanished, and you will have removed so many curtains that hide from his eyes his true enemy.

He will see that capital become free will make him no less a slave than capital trammeled by customs duties.

Gentlemen! Do not allow yourselves to be deluded by the abstract word freedom. Whose freedom? It is not the freedom of one individual in relation to another, but the freedom of capital to crush the worker.

Why should you desire to go on sanctioning free competition with this idea of freedom, when this freedom is only the product of a state of things based upon free competition?

We have shown what sort of brotherhood free trade begets between the different classes of one and the same nation. The brotherhood which free trade would establish between the nations of the Earth would hardly be more fraternal. To call cosmopolitan exploitation universal brotherhood is an idea that could only be engendered in the brain of the bourgeoisie. All the destructive phenomena which unlimited competition gives rise to within one country are reproduced in more gigantic proportions on the world market. We need not dwell any longer upon free trade sophisms on this subject, which are worth just as much as the arguments of our prize-winners Messrs. Hope, Morse, and Greg.

For instance, we are told that free trade would create an international division of labor, and thereby give to each country the production which is most in harmony with its natural advantage.

You believe, perhaps, gentlemen, that the production of coffee and sugar is the natural destiny of the West Indies.

Two centuries ago, nature, which does not trouble herself about commerce, had planted neither sugar-cane nor coffee trees there.

And it may be that in less than half a century you will find there neither coffee nor sugar, for the East Indies, by means of cheaper production, have already successfully combatted his alleged natural destiny of the West Indies. And the West Indies, with their natural wealth, are already as heavy a burden for England as the weavers of Dacca, who also were destined from the beginning of time to weave by hand.

One other thing must never be forgotten, namely, that, just as everything has become a monopoly, there are also nowadays some branches of industry which dominate all others, and secure to the nations which most largely cultivate them the command of the world market. Thus in international commerce cotton alone has much greater commercial than all the other raw materials used in the manufacture of clothing put together. It is truly ridiculous to see the free-traders stress the few specialities in each branch of industry,throwing them into the balance against the products used in everyday consumption and produced most cheaply in those countries in which manufacture is most highly developed.

If the free-traders cannot understand how one nation can grow rich at the expense of another, we need not wonder, since these same gentlemen also refuse to understand how within one country one class can enrich itself at the expense of another.

Do not imagine, gentlemen, that in criticizing freedom of trade we have the least intention of defending the system of protection.

One may declare oneself an enemy of the constitutional regime without declaring oneself a friend of the ancient regime.

Moreover, the protectionist system is nothing but a means of establishing large-scale industry in any given country, that is to say, of making it dependent upon the world market, and from the moment that dependence upon the world market is established, there is already more or less dependence upon free trade. Besides this, the protective system helps to develop free trade competition within a country. Hence we see that in countries where the bourgeoisie is beginning to make itself felt as a class, in Germany for example, it makes great efforts to obtain protective duties. They serve the bourgeoisie as weapons against feudalism and absolute government, as a means for the concentration of its own powers and for the realization of free trade within the same country.

But, in general, the protective system of our day is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade.

This is a translation and has a separate copyright status from the original text. The license for the translation applies to this edition only.
Original:
This work published before January 1, 1923 is in the public domain worldwide because the author died at least 100 years ago.
 
Translation:
This work published before January 1, 1923 is in the public domain worldwide because the author died at least 100 years ago.