Popular Science Monthly/Volume 34/November 1888/Sketch of Edward Atkinson
THE subject of the present sketch holds a prominent position among American writers who have made most valuable contributions to political and economic science. His essays, all in this or related departments, are characterized by far-reaching grasp of thought, boldness and absolute independence in discussion, and the clear and direct manner in which the principle he is seeking to develop is presented.
Edward Atkinson was born in Brookline, Mass., February 10, 1827. Having fitted for college, it became expedient for him to go to work at an early age, and he served his time, after August 8, 1843, in a commission-house for the sale of domestic cotton goods. In 1848 he entered the service of manufacturing companies, and from that date until 1878 was engaged as treasurer or manager of factory corporations. In 1878 he became President of the Boston Manufacturers' Mutual Fire-insurance Company, and has since devoted his time largely to the study of the prevention of fire in factories.
In one of his essays he says that he first began to think in the Free-Soil campaign of 1848; that he then despised statistics, and was under the profound conviction that every advocate of free trade had a cloven foot. He held to these opinions until about the beginning of the war. Being prevented from entering the service by home duties, he devoted himself to the study of the resources of the United States, and from the study of facts rather than of books, and from his long experience, he became an advocate of hard money, opposed to the Legal-Tender Act, and in 1866 he also became a convert to free trade, subject in its application to such consideration as might rightly be given to branches of industry whose course had been somewhat altered by the long continuance of the protective system.
Besides his studies in economic science, and above them, according to his own estimation, Mr. Atkinson is the inventor of a form of cooking apparatus by which the process of preparing food is greatly facilitated, while the quality of the product is certain to be improved. It comprises two ovens, one heated by a column of water, the other heated by a column of air, the heat being derived from common kerosene-oil lamps so arranged that the products of the combustion of the oil can not touch the food. Having baked twenty pounds of bread in one oven with one cent's worth of oil, and being able either to simmer in one vessel or to roast in the hot-air oven thirty pounds of meat at a cost of not exceeding two cents' worth of oil, he believes that he has accomplished economy in domestic cookery in a way which Count Rumford attempted but failed to make popular, but which might become the common practice of all, now that kerosene-oil yields a cheap source of heat. These inventions are not patented, but are purposely left open for public use.
By his connection with an association of New England mill-owners, for prevention of fires in their factories and for insurance, he has been instrumental in raising the profession of underwriter from a mere system of betting on the chances of loss by fire on property, as it may happen to be at any given time, to one in which science shall be applied at every point, both in the construction and occupation of buildings, and to the prevention of such losses, under the direction and instruction of capable officers of insurance companies, who will consider every loss by fire an obnoxious incident for which, some person, generally the owner or occupant, shall be held responsible.
From the fruits of his studies in economic science he has sustained, or perhaps first presented, the proposition that the burden of a tax upon any commodity can be truly measured only by its ratio to the margin of profits on a given manufacture rather than by its ratio to the total cost of the product into which the taxed material enters as a component. Hence a tax bearing a very small ratio to the gross value of the product, when imposed upon some apparently insignificant article which enters into a process of manufacture, may entirely forbid the establishment of that branch of industry in a country where otherwise it might have been successfully established. He therefore opposes duties on what are commonly but incorrectly called "raw materials," for the reason that such duties, when imposed upon crude or partly manufactured materials which are used in the various processes of domestic industry, not only cripple the manufacturers, but also injure the domestic producers, even of the same materials, by restricting their use.
He has, further, worked out and presented facts in proof of the theory that the wages or earnings of those who are commonly called "the working-classes" are a result of production, and can not be considered an antecedent to production which can be absolutely measured and determined or agreed upon for any considerable period before the work is undertaken, since all taxes, profits, and wages must, in the long run, be derived from the product itself. It follows, however, from this principle that, under free conditions, high wages in money, or in what money will buy, must in the end be the necessary correlative or consequence of a low cost of production. In other words, the price of labor does not measure the cost of labor, the cost of labor depending upon many other elements than the wages or earnings of those who take part in the conversion of the cruder products of the soil, the mine, or the forest, into the finished forms commonly known as manufactures.
He has also maintained the proposition that under free conditions of exchange the workman must of necessity, decade by decade, secure to his own use or enjoyment an increasing share of an increasing product, even though free exchange be limited in the United States to its own area—the exceptions to this rule being in countries where the free exchange of services is obstructed by the diversion of products in the form of taxes to the support of great standing armies, or to the payment of interest on huge national debts. In such instances, the benefits of improvement and invention being taken up by the tax-gatherer, it may follow that the workman is, decade by decade, becoming poorer and more incapable of sustaining himself in comfort and welfare. This conclusion—that labor receives a constantly increasing share of an increasing product, and that capital receives a diminishing share of an increasing product—which Mr. Atkinson has demonstrated, is one of the most encouraging facts that have been discovered in the progress of modern civilization. It tends to show, what we now know to be the fact, that there is a gradual equalization in the distribution of property, and that a larger number of persons in this age possess a competence than in any other period of the history of the race.
The proposition that the burden of a tax upon any commodity is measured by its ratio to the margin of profit rather than to the entire cost of the product, is vigorously presented in an article on "The Visible and Invisible in Protection," which was published in the "Atlantic Monthly" for February, 1872. Its truth is even more evident in the condition of our country to-day than it was at that time. Classifying commodities subject to taxation, as those which are of necessary use in processes of domestic production, and those which are of voluntary use on the part of the consumer, the paper lays down the principle that, "in accordance with the rule that it is fit to take, under the necessity of taxation, a small portion of the luxury or even the comforts which men seek as the end of their labor, rather than to impair their means of subsistence, taxes should not be imposed upon articles of the first class, but may be imposed upon those of the second class." The effect is then considered of the taxes then and now imposed upon articles of the first class in their relation to profits, and is gauged by comparison with an imaginary tax upon an article in Universal use on which no tax would be tolerated, if it were imposed. Such an article is milk, with its products, butter and cheese. Suppose their price were increased by the imposition of a tax of fifty per cent. "There would surely be controversy, bitter discussion, and perhaps violent resistance, should such a tax be imposed; and yet the general cost of subsistence would be no more increased, while the power of enlarged production would be far less restricted and hampered, by a tax of fifty per cent upon dairy products, than they are now by the tariff taxes imposed on foreign imports of crude or partially manufactured materials. Nor would the burden be distributed more widely. The use of dairy products is no more universal or necessary than the use of the articles of foreign import named in our list" (including a number of articles of the first class); "and there is almost as much luxurious consumption of dairy products as there is of foreign imports. It may be asserted, without fear of contradiction, that all these articles imported from other countries are as much the product of American labor as the dairy product, or as if they had been raised upon American soil by the hands of native-born men and women, since every one of them has been or must be paid for by an exchange of some domestic product for it, whether it be cotton, oil, gold, cheese, or wooden clocks; and the only reason why this exchange is ever made is that we have too much of the things made upon our own soil, and too little or none at all of those things of foreign origin for which we make the exchange. Production is but a leading forth; it is but movement. We move the cotton-seed to the soil, the cotton to the Northern mill, the cloth to the seaboard; then, by the steamship, we move it to where it is more needed than by ourselves; we move back the tea, and the tea is but the final product of the labor of the freedman, the operative, and the sailor, each of whom is or may be our countryman, and each of whom is counted as a representative of home industry. ...
"We once established the manufacture of furniture, so that our mechanics, working at from $2.50 to $3 per day, yet supplied many foreign customers; but we have taxed the wood, the varnish, the oil, the paint, the tools, the food, and the fuel of these men forty per cent on all those portions which are of foreign origin, and thus they have lost their customers. Privation of imports is prohibition of exports. Protection to the mechanic is to be found only in the repeal of bad taxes."
The far-reaching nature of the evil of wrongful taxation is illustrated in the case of the taxation of tin plates, for which revenue the Government has no use whatever, but by the operation of which "we leave England and France to supply the world with canned meats and fruits, while we only put up enough for our own use." This result is brought about by the tax adding to the cost of the domestic product into which the tin enters as a constituent element; "and if this increase amounts to only two or three per cent of the value of the finished product, it amounts, as we have proved, to a tax on the income of capital of from two or three up to ten or twenty per cent. Hence, foreign capital takes the business, and home labor ceases to be employed; diversity of employment is prevented; wages are lowered, and the cost of subsistence increased; and all this is done in the name of protection to labor!"
The visible in protection—what one sees, "is that we prosper in spite of all the privations inflicted under due process of law; such are the boundless resources with which the Almighty has endowed this land." The invisible, what one does not see, "is the far greater prosperity which we might have, except for the ignorance of those who make these unjust laws, and in the name of protection inflict privation. What one does not see is the progress in the arts of peace and good-will with all nations which might ensue if we did but realize that the ships that pass between this land and that are like the shuttle of a loom, weaving the web of concord among the nations, and that commerce is the most potent agent of civilization."
Mr. Atkinson is what is called a self-educated man, but he accepts the comment made by Dr. Francis Lieber on this phrase, that one might as rightly speak of a self-laid egg. What both gentlemen mean by this dictum doubtless is that men are inevitably the creatures of the conditions among which they are placed, over which they have no control. But, as it is usually applied, the expression "a self-made man" means no more than that his character and faculties have been developed independently of the artificial aid of schools and book-lore, by hard contact with the world and the experiences of active life; and Mr. Atkinson would hardly deny that he is a man of that kind. What he is, in character and modes of thought, is in the main the product of a life spent in the factory and counting-house, combined with habits of close, independent observation. A clew as to the turn which his seeking takes when knowledge is to be acquired, may be gained from the opening sentences of his paper on "Kentucky Farms," in "Harper's Magazine" for June, 1881: "Whenever a business man gets away from his affairs, and journeys into a far country for even a short time, he may see many things that he would entirely overlook if, with his mind filled with the everyday cares of life, he passed through the very same sections in the usual unobservant way. A pity it is that our commercial travelers could not become trained observers, ready and acute as they are in all that pertains to their work, often witty and full of good stories. If they could learn to spend the many hours which they are obliged to pass wearily in country taverns that are none of the best, and are often of the worst, in reporting what they might observe, what a resource against weariness it would be for them, and what a benefit to all who wish to know what the resources of this country really are, and how they could be developed! The business man who can write at all writes best for other business men." To this habit of sharply observing for himself, Mr. Atkinson adds, as he goes on to relate, what he calls a patent method of his own. He goes to persons—as for instance, in this case the State geologist, in studying the resources of Kentucky—who have special knowledge of the subject in hand, and becomes, for the time being, their student. By such means he has accumulated a vast fund of information about the resources of the United States, and the condition of the different parts of the country, which, having made himself familiar with the subject in hand, he can use with telling effect whenever he has a condition to account for, or a lesson to draw indicating a line of policy. His journey to Kentucky was made to obtain information about the homespun fabrics that are made and worn by the people of the mountain-regions of that and the adjoining States. In a discussion concerning the conditions of transporting flour from Minneapolis to Europe, he acknowledges indebtedness to twenty-six distinct sources whence he obtained information, including railroad presidents, manufacturers, editors of special journals. Government officers, and managers of land-mortgage companies. The purpose of the discussion just named was to prove that it was possible to supply the European markets with breadstuffs at a very low cost, and at the same time secure high earnings to farm-laborers, coupled with reasonable profits to the farmers, millers, and transportation companies. Having shown that the wages of one day's work of a good mechanic on the Eastern seaboard of the United States will suffice to move his year's supply of grain and meat one thousand miles from the Western prairie, while the skilled workman of Great Britain may also move his year's supply of grain and meat four or five thousand miles at a cost of two days' labor, possibly three, he adds: "Have not the scientists who have eliminated time and distance made the whole world one great neighborhood in which each man may serve his neighbor? But the masters of physical science have only removed natural obstructions. There is work now for the masters of political science. It now remains for Legislatures to remove the artificial obstructions created by their predecessors in order that each nation may serve the other. When that is done, the interdependence of the men of all countries and of all climes will be established, and the foundation of peace, order, industry, good-will, and plenty among all nations will be firmly laid."
Such is the destiny to which Mr. Atkinson, despising the petty devices and make-shifts of politics, and looking only to what will contribute most directly to the ultimate result, would lead us.
Mr. Atkinson is a member of the American Academy of Arts and Sciences, of the British Association, Fellow of the American Association for the Advancement of Science, of the American Statistical Association, of the Political Economy Club, of the International Statistical Institute, of the Cobden Club, and several other bodies of like kind. He has never held any public office except when commissioned by the President in 1887 to report upon the status of bimetallism in Europe. He has always been an independent in politics.
The various papers which have been written by Mr. Atkinson are constantly referred to in economic discussions by persons who differ with each other and who do not accept his conclusions, his analyses of the facts of the economic life of the nation being accepted even by those who do not agree with his theories.
His papers on the industrial development of this country, especially during the last twenty-five years, are cited by the advocates of both policies in the present tariff controversy. Their ability and fairness of statement are fully admitted. Mr. Atkinson himself believes that the tariff question is one of the minor factors in the industrial history of this country; that its influence in promoting certain branches of industry has been much exaggerated on the one side, and that its burden upon consumers has been as much exaggerated upon the other. He rejects alike the theory of the extreme advocate of protection, that diversity of occupation has been promoted by means of the protective system; and, on the other hand, he rejects the theory of the extreme free-trader that an enormous bounty has been paid to or gained by special industries, merely because a duty has been imposed upon a foreign import of like kind. He holds that while manufactures would be established in greater variety, and would attain ultimately much greater prosperity, if free exchange could be attained by a cautious and systematic reform, on the other hand, the market for the excess of the crude products of our soil, as well as for our manufactures, might be vastly extended by such reform—to the end that the United States would attain a commanding position in the commerce of the world, even to the extent of possibly compelling European nations to disarm. Keeping in view the proposition that profits, wages, and taxes are alike derived from the joint product of labor and capital, he presents the simple formula that "a nation free from debt, subjected to the lowest rate of taxation of any nation in the world, and without the need of withdrawing from productive labor an enormous number of men to be enlisted in a standing army or navy, and finally endowed with greater natural resources than any other country in proportion to the population, must be able to compass a larger product at less cost than can be attained in any other of the so-called manufacturing countries." He therefore advocates a gradual but sure reform of the abuses which exist in the present acts for collecting the national revenue, to be brought about with due regard to the present condition which many branches of manufacture have reached during the long period in which a high tariff has been in force."
Mr. Atkinson's essays, nearly all upon subjects of political economy, have been published at various times since 1861 in independent pamphlets, the reports of economical associations, and periodicals of general circulation, such as the "Atlantic Monthly," "Scribner's Magazine," "The Century," "Harper's Magazine," and the "North American" and "International Reviews." The full list numbers more than forty titles, including the following: "Cheap Cotton by Free Labor," 1861; "Is Cotton our King?" 1862; "The Future Supply of Cotton," 1864; "The Collection of Revenue," 1866; "Free Trade and Revenue Reform," 1871; "The Visible and Invisible in Protection," 1872; "An Easy Lesson in Money and Banking," 1874;" "Argument for the Conditional Reform of the Legal-Tender Act," 1874; "Commercial Development in the First Century of the Republic," 1876; "Industrial Reconstruction," 1878; "Our National Domain" (chart), 1879; "American View of American Competition" (London), 1879; "Labor and Capital Allies, not Enemies," 1880; "The Fire-Engineer, the Architect, and the Underwriter," 1880; "The Railroads of the United States," 1880; "The Unlearned Professions," 1880; "Address on Banking," 1880; "A Reply to Prof. Bonamy Price," 1880; "Cotton Manufactures of the United States," 1880; "Addresses at Atlanta, Ga., at the International Cotton Exposition," 1880, 1881; "What is a Bank?" 1881; "Elementary Instruction in the Mechanic Arts," 1881; "Address at the Annual Banquet of the Massachusetts Charitable Association," 1881; "What makes the Rate of Interest?" 1881; Address on the Right Method of preventing Fires in Mills," 1881; "The Solid South," 1881; "The Railway and the Farmer," 1881; "Kentucky Farms," 1881; "The Influence of Boston Capital upon Manufactures," 1882; "Significant Aspects of the Atlanta Exposition," 1882; "The Rapid Spread of Communism," 1882; "Address at the Opening of the Manufacturers' and Mechanics' Institute Fair," 1882; "Inefficiency of Economic Legislation," 1882; "What makes the Rate of Wages? "1884; "Address to the Chiefs of the Bureau of Labor Statistics," 1885; "The Distribution of Products," 1885; "On the Application of Science to the Production and Consumption of Food," 1885; "Prevention of Loss by Fire," 1885; "The Hours of Labor," 1885; "Address on the Silver Question," 1886; a series of monographs (in "Bradstreet's") on economic questions; a series of articles (in "The Century") on "Food and Wages"; "The Margin of Profits," 1887; "Report on Bimetallism in Europe," 1888; a series of articles in "The Forum," 1888. Of these papers, the address at Atlanta, in 1880, was characterized by Judge E. R. Hoar as marking an "era in the history of the country"; and the book on the "Distribution of Products" was pronounced by Sir Louis Mallet "epoch-making."
It has been advanced as a weak point in the theory that man has received his qualities by inheritance from the other races, that when men manifest extraordinary qualities they are such as are entirely different from those possessed by any other creature, and peculiar. Human prodigies excel, not in the development of animal traits and instincts, but as wonderful calculators, great moral geniuses, or phenomenal musicians. The most wonderful instincts of the lower creatures appear to be extinguished by the advance of reason, instead of being stimulated by it; and men who transcend humanity do so not in the respects in which they have inherited most, but in those in which they have inherited least.