The Falling Wage Trend

B. The Falling Wage Trend

In a talk of 1865 to a working class audience “Value, Price and Profit” (also known as “Wages, Price and Profit”), Marx makes clear his view that the commodity wages of the employed work force tend downwards. He refers to the “continuous struggle between capital and labour, the capitalist constantly tending to reduce wages to their physical minimum, and to extend the working day to its physical maximum, while the working man constantly presses in the opposite direction” (MECW 20: 146). “[T]he very development of modern industry,” he continues, “must progressively turn the scale in favour of the capitalist against the working man, and . . . consequently the general tendency of capitalistic production is not to raise, but to sink the average standard of wages, or to push the value of labour more or less to its minimum limit” (148). Rosdolsky (1980: 303–56) has claimed that the passage must be understood subject to the absence of trade union counterpressure. That this is so, runs his argument, is implied by the continuation of the passage: “Such being the tendency of things in this system, is this saying that the working class ought to renounce their resistence against the encroachments of capital, and abandon their attempts at making the best of the occasional chances for their temporary improvement? If they did, they would be degraded to one level mass of

89 broken wretches past salvation” (MECW 20: 146). Now it is true enough that the

B. The Falling Wage Trend

wage rate is the outcome of a “continuous struggle between capital and labour,” so that “[t]he matter resolves itself into a question of the respective powers of the combatants.” But with which party does the advantage lie? Marx is explicit that trade unions at best “are retarding the downward movement but not changing its direction; that they are applying palliatives, not curing the malady. They ought, therefore, not to be exclusively absorbed in these unavoidable guerilla fights incessantly springing up from the never-ceasing encroachments of capital or changes in the market. They ought to understand that, with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society” (148–9; first emphasis added).

There can surely be no doubt that this discussion posits a declining commodity wage rate. Yet for all that we also find, in the very same speech, a more circumspect tone as far as concerns recent trends: “many contemporary writers have wondered that English capital having grown in the last twenty years so much quicker than English population, wages should not have been more enhanced ” (147; emphasis added) – to which the “progressive change in the composition of capital,” i.e., labor- saving technology, is offered as explanation.

In Capital itself, Marx declaimed regarding the laborer’s worsening condition in consequence of technological advance: “the higher the productiveness of labour, the greater is the pressure of the labourers on the means of employment, the more precarious, therefore, becomes their condition of existence, viz., the sale of their own labour power for the increasing of another’s wealth, or for the self-expansion of capital” (MECW 35: 639). Consider also the account of “the material conditions” of factory labor which should certainly be included in any measure of the com- modity wage: “Economy of the social means of production, matured and forced as in a hothouse by the factory system, is turned, in the hands of capital, into system- atic robbery of what is necessary for the life of the workman while he is at work, robbery of space, light, air, and of protection to his person against the danger- ous and unwholesome accompaniments of the productive process, not to mention the robbery of appliances for the comfort of the workman”(429–30). The falling commodity wage is a refrain repeatedly heard, Marx citing Ricardo’s “machinery” chapter: “The same cause which may increase the revenue of the country [rent and profit] . . . may at the same time render the population redundant and deteriorate

the condition of the labourer” (435n, 626n; also 411n). 4 Andrew Ure is cited to similar effect regarding the impact of improved machinery within “Modern Indus- try” (435–6). Declining commodity wages is a central feature of the account of the cotton industry during the 1860s: “the inventive spirit of the master never stood still, but was exercised in making deductions from wages,” a trend supplemented

4 Marx wrote of Ricardo’s volte face on machinery in 1821 as an instance of “the scientific impartiality and love of truth characteristic of him” (MECW 35: 441n).

90 Economic Growth and the Falling Real-Wage Trend

by a deterioration in work conditions (460). The net outcome of cyclical periods of crisis and depression was a “general reduction of wages,” the period 1815–63 including “only 20 years of revival and prosperity against 28 of depression and stagnation” (461). There are also the responses made to Gladstone’s optimistic evaluations of contemporary trends in his Budget speech of 16 April 1863, accord- ing to which “while the rich have been growing richer, the poor have been growing

less poor” (645–6). 5 Marx alluded favorably to Gladstone’s recognition of falling real wages in his earlier Budget speech of 1843 – “an increase in the privations and distress of the labouring class and operatives . . . [despite] a constant accumulation of wealth in the upper classes, and a constant increase of capital” – but rejected the later case on the basis of price data relating to “meat, butter, milk, sugar, salt, coals and a number of other necessary means of subsistence.” Similarly, amenity – with special reference to house room – had tended to deteriorate, for which propo-

sition extensive evidence is brought (651f). 6 It is particularly revealing that Marx predicted a similar pattern in the United States to that supposedly under way in Britain: “Capitalist production advances there with giant strides even though the lowering of wages and the dependence of the wage worker are yet far from being brought down to the normal European level” (760). 7