July 28, 2011

The Eminently Real Free Market (XXI): Sketchy Stories (10): Dismissive of the New, Evasive of the Old

When Tom Woods once again drew kind attention to this blog, he also indirectly reminded us of our limitations. One doesn’t have to be an expert to see that someone else isn’t, a point we made before, but one would do well to know just where one’s “inexpertise” lies.
And so when Tom cited two books by G. E. Mingay (Enclosure and the Small Farmer in the Age of the Industrial Revolution and the more recent Parliamentary Enclosure in England), both in the above-cited post and in a paper he co-authored and linked to in an earlier post, he showed us, as only a trained historian who keeps abreast of the literature could, where we could supplement our knowledge.
Although we have not read Mingay, we observe that doing so is demonstrably not a condition of exposing the inadequacy of Mr. Ferrara’s awareness of what had been written before Mingay.
When we provided an excerpt from a review by Rothbard on enclosure, we omitted a reference note of his that Roberta Modugno had included in her edition of Rothbard’s previously unpublished reviews, Rothbard vs. The Philosophers:
For a refutation of the enclosure myth and a recognition of the key being increase of population, see W. H. B. Court, A Concise Economic History of Britain from 1750 to Recent Times (Cambridge: Cambridge University Press, 1954).
That book, more than fifty years old--and therefore falling within Mr. Ferrara's chronological ambit of possible interest--shows in its first two chapters that the coffin of Received Opinion on the Industrial Revolution and enclosure, if nailed shut only by Mingay’s day (if we discern Dr. Woods’s assessment accurately), was at least closed by Court’s. We now cite parts of his narrative that bear on Mr. Ferrara’s promotion of Dickensian tragedy, which makes incomprehensible the pro-life story that was unfolding during this period, including an increase in living standards, most centrally the dramatic increase in the numbers of Britons who were born and lived to have children of their own.
In eighteenth-century Britain we are watching the gradual rise of the large average size of family which prevailed in this country in Victorian times. . . . To put the matter more exactly, the large surviving family was, so far as can be seen on imperfect evidence, mainly the result of forces which diminished mortality, but which had as their secondary effect the increase of fertility, meaning by fertility the number of children born to a family. The saving of children at birth or in the first years of life and the lengthening in the expectation of life among mothers may account for the greater part of the advance of population in the eighteenth century. . . . (op. cit. 10-11)
The general fall in the death-rate was due to many things. An improvement of medical services was one of them. Medical knowledge in the eighteenth century was beginning to show what it could do, although much of the knowledge was empirical rather than scientific in the strict sense. . .  . Knowledge of the rules of health, however, could not have helped very much, if the slow improvement in the water-supply, paving and sanitation of English towns had not made it possible to apply them. (op. cit. 11)
. . . Taking the country as a whole, the rate of deaths per thousand of population began to fall, as far as we can tell, after the first quarter of the century and declined markedly from 1780 onwards, despite the rapid growth of town life. Between the end of the French wars in 1815 and the cholera epidemic of 1831-2, the death-rate rose sharply, but it never regained the old levels. (op. cit. 12)
. . . Every increment in the productivity of British agriculture and industry, from the end of the Civil War [1642–1651—A.F.] onwards, had a bearing on the increase in numbers in the subsequent century and a half. The population of Tudor [1485-1603—A.F.] and Stuart [1603-1714—A.F.] England had lived a hard life. Every change for the better, however small, in their food, clothes or housing, must have affected the chances of survival. Many changes of this kind took place in the late seventeenth and early eighteenth century, not least owing to improvements in agriculture. . . .  (op. cit. 12)
Industrial production provided cheaper and cleaner underwear, cotton and soap and greater cleanliness increased the resistance to disease. . . . (op. cit. 12)
There were, therefore, powerful forces playing in the eighteenth and early nineteenth century upon the old high mortality which British population had suffered along with that of other countries, and they brought it down. . . . The saving of lives among young children and child-bearing women promoted a high birth-rate; but as more children were born and survived, the greater proportion of young people in the population may be assumed to have brought the average death-rate down, for an old population dies faster. These interactions must have been important, but they cannot with the surviving material be easily traced and weighed. (op. cit. 13)
The picture presented by the British population after 1750 is therefore one of a land in which the old conditions of life had been sufficiently modified to permit a rapid increase of numbers. (op. cit. 13)
Mr. Ferrara ignores all of this, preferring to bemoan “the loss of village life, and the independence of the cottager with his small plot of land,” (17) that is, what Court summarily referred to as “the old conditions of life,” redolent in its anti-human implications of the most chilling of today’s “green” propaganda.

July 27, 2011

The Eminently Real Free Market (XX): Sketchy Stories (9): Knocking Nock, Grand Theft Monastery, and Grand Conspiracy

We decline to cross-examine Albert Jay Nock, “that great hero of contemporary libertarians” (17), whom Mr. Ferrara called to the witness stand. Nock’s many literary services to libertarianism cannot save an opinion overthrown by scholarship, which Nock’s generalization (at least as Mr. Ferrara represents it—not a negligible modifier) unfortunately is.
In any case, the fortunes of Austro-Libertarianism do not depend on Nock’s implicit endorsement of a fable by Dickens, which makes The Village Labourer look up-to-date by comparison.
It should not be thought, however, that Mr. Ferrara endorses Nock’s interpretation of the alleged facts, because he “lays the blame for early capitalist depredations entirely upon government intervention rather than rugged individualism and laissez-faire” (17), presumably Mr. Ferrara’s preferred explanans
How individualism (of whatever texture) or a policy of limited governmental intervention could be morally responsible for “depredations,” that is, the unethical behavior of some owners of capital, he leaves to his reader’s imagination, which he is happy to excite with facile generalizations:
. . . the historical truth is that the State and capitalism partnered in the grand theft that caused the destruction of Catholic social order, the loss of village life and the independence of the cottager with his small plot of land, and finally the creation of capitalist social order with all its abuses. (17)
A necessary, if not sufficient, condition of a proposition’s being an historical truth is coherence. A thesis that treats “capitalism” as both cause and effect, however, does not satisfy that condition. If “capitalist social order” is the result of the grand theft, “capitalism” cannot also be behind it. Mr. Ferrara has not even suggested that any individual capitalists were, only that some of them later benefited from that prior State action with which they had nothing to do. What beneficiaries of crime or their heirs ought to do with their property once they realize how it was acquired is a separate moral question, one bearing not at all on the question of the moral goodness of a social order exhaustively comprised of free markets.
In the period in question the only event that qualifies as grand theft is the dissolution of the monasteries consequent to Henry VIII’s edicts (i.e., Act of Supremacy, and the First and Second Suppression Acts). Although Mr. Ferrara’s prose habitually conflates those confiscatory acts with the enclosure of the commons that took place over centuries, by fair means and foul, there is no justification for doing so. Enclosure was not achieved by grand theft. Nor can one sensibly impute such State crimes to owners of capital (the only stable meaning of “capitalists”) or even a concerted move by them to seize power.
Of course, some believe that the theological issues ostensibly presenting themselves when one studies the period were mere ideological “superstructure” erected upon the “base” of the means of production, and that changes in the nature of those means and the struggle over their control hold the Key to History. On this view, Henry VIII and his minions were merely agents (conscious or not) of the nascent English bourgeoisie, incarnating the dialectic of history willy-nilly. Such writers may be politely referred to as historical materialists or, more frankly, Marxists among whom, of course, Mr. Ferrara is not to be numbered.
At least, however, we understand what the Marxist is suggesting. By contrast we do not know what Mr. Ferrara meant when he wrote that the State, in the person of Henry, “partnered [conspired?] with capitalism” (A social order? An ideological movement?) to displace one social order with another. If he meant to say that a grand conspiracy overthrew the Catholic social order, then he should have done so, and plainly. But the transition from one social order into another is not the sort of thing that has a unitary cause like “grand theft.” But the propagandist must resort to such facile narratives to hold his audience.

July 26, 2011

The Eminently Real Free Market (XIX): Sketchy Stories (8): The Hammonds, T. S. Ashton, and Emily Litella

We take the occasion of this post, our fiftieth, to remind our visitors that we do not belabor Mr. Ferrara’s errors on enclosure (or on anything else) because we believe they are in a close competition with the truth. We do so only to discredit the rhetorical performance of a propagandist. No one except theologically like-minded individuals already disposed toward his conclusions take his historical opinions seriously. But the performance still merits exposure.
We pass over quickly his reliance on the Hammonds’ long-superseded The Village Labourer, 1760-1832 (1911), which he refers to as “a Protestant source with no Catholic axe to grind” (16), the latter phrase being one he should perhaps not mention aloud. He apparently never cared to see whether they maintained their uniformly gloomy assessment of period:
[S]tatisticians tell us that when they have put in order such data as they can find, they are satisfied that earnings increased and that most men and women were less poor when this discontent was loud and active that they were when the eighteenth century was beginning to grow old in a silence like that of autumn. The evidence, of course, is scanty, and its interpretation not too simple, but this general view is probably more or less correct. J. L. and Barbara Hammond, The Bleak Age, revised edition, London: Pelican Books, [1934] 1947, p. 15. Cited in F. A. Hayek, “History and Politics,” Hayek, ed., Capitalism and the Historians, The University of Chicago Press, 1954, p. 14. (Available through Amazon or the Mises Bookstore.)
Mr. Ferrara’s distortion of T. S. Ashton’s perspective is more serious. He introduces his quotation of the historian with: “Even that sturdy Protestant defender of the Industrial Revolution, T. S. Ashton, was constrained to admit the truth.” (16) It is insolent to suggest that Ashton, a master of the period, would feel "constrained" to “admit” any facts, as though he were afraid of their effect on prejudice. On the contrary, it is Mr. Ferrara who has reason to fear the effect of what Ashton actually wrote on Mr. Ferrara’s reputation as a writer.
In the very paragraph from which Mr. Ferrara took his quotation, Ashton—having just noted that enclosure “had been taking place almost continuously from at least as early as the thirteenth century,” that most of these enclosures “were made by private arrangement between the proprietors concerned,” and that “enclosure by Act [of Parliament against unwilling tenants] did not play an important part until after 1760”—writes sympathetically of:
. . . humbler classes of people who received little or no consideration. The cottagers who had cultivated a few strips in the open fields, and supplemented their incomes by part-time work on those of their wealthier neighbours, might, indeed, be given a small holding when the land was re-divided. But it was less easy to graze a cow, keep fowls, or gather fuel, when the greater part of the waste [land] had been allotted to the squire or the larger cultivators. On the fringe of most open-field villages, there were many squatters who obtained a precarious living, either by primitive husbandry on tiny intakes, or by wage-earning, poaching, begging, thieving, or the receipt of poor relief. Taking little part in the life of the community, they had been tolerated by the easy-going, open-field cultivators. But the enclosed village had little use for such people: their presence was an obstacle to the full utilization of the land, and their poverty laid a burden of parish rates on the tenant farmers.
T. S. Ashton, The Industrial Revolution [1961]. With a new preface and bibliography by Pat Hudson. Oxford University Press, 1997, p. 20.
It is hard to see how Mr. Ferrara could introduce to his readers parts of that paragraph and the next in terms of what Ashton would be “constrained to admit” unless he was confident that they probably did not have Ashton’s immediately preceding words at hand. Here are those parts in Mr. Ferrara’s rendition:
Evicted from their cottages, which were afterwards razed to the ground, they [the dispossessed peasants] crowded to areas where the fields were still open, or took to vagrancy. They and their descendants must have contributed largely to the body of semi-employed, inefficient labour that was to trouble the peace of politicians and poor-law administrators until 1834 and beyond . . . . [I]t was precisely because enclosure released [!] (or drove) [Ashton’s embarrassed parentheses] men from the land that it is to be counted among the processes that led to the industrial revolution. (16-17)
Mr. Ferrara’s exclamatory sound effect and suggestion that the facts that Ashton had just recounted “embarrassed” him express only insolence. Men were mainly released from the land by voluntary agreement for centuries before the violent seizure of Church lands by Henry VIII (with whose violent images Mr. Ferrara is determined to associate enclosure in the minds of his readers) and before the industrial revolution. In some cases they were evicted unjustly. Ashton’s non-embarrassing, parenthetical reference to those who were driven out expresses proportion.
What Mr. Ferrara’s ellipses obscured we indicate in italics:
Evicted from their cottages, which were afterwards razed to the ground, they crowded to areas where the fields were still open, or took to vagrancy. They and their descendants must have contributed largely to the body of semi-employed, inefficient labour that was to trouble the peace of politicians and poor-law administrators until 1834 and beyond.
Some writers who have dwelt at length on the fate of those who were forced to leave the land have tended to overlook the constructive activities that were being carried on inside the fences. The essential fact about enclosure is that it brought about an increase in the productivity of the soil. There has been much discussion as to whether it led to a decline in the number of cultivators, and some who hold that it did write as though this were a consequence to be deplored. It is a truism, however, that the standard of life of a nation is raised when fewer people are needed to provide the mean of subsistence. Many of those who were divorced from the soil (as the stereotyped phrase goes) were free to devote themselves to other activities: it was precisely because enclosure released (or drove) from the land that it is to be counted among the processes that led to the industrial revolution, with the higher standards of consumption this brought with it. (Ashton, op. cit., 20-21.)
We insist that one unjust eviction is one too many, but Ashton asks what else was going forward besides eviction, just as we would ask despisers of the One, Holy, Catholic, and Apostolic Church whether they are interested in knowing anything else about the Church besides schism, pedophile priests (and their episcopal protectors), and the predominance, in the Roman Catholic Church’s College of Cardinals, of Italians who have tended to elect Italians for popes. Ashton argued that much else went on during the period we call the industrial revolution, and much of that redounded to the benefit of the “humbler classes of people.”
Mr. Ferrara, who apparently knows how to use an ellipsis when it suits him, appended a full stop after “revolution,” even though there is more to the last sentence. Unless higher standards of consumption embarrass him, why not refer to it, or have the decency to cover mention of it with three dots?
Again, we are not so naïve as to think that pointing out lapse after lapse from standards of controversy has any effect on him. His obduracy in error may be the rhetorical equivalent of Emily Litella’s hearing deficit, but even she would eventually face the camera and say “Never mind!”

July 19, 2011

The Eminently Real Free Market (XVIII): Sketchy Stories (7): Rothbard on Enclosure and the Subjugation of Church to State

Before considering Mr. Ferrara’s next historical sketch of an “immense picture” culled from “a large library of books,” we’d like to call upon one more witness for our pro-life defense of the rise of capitalism. Our witness is none other than the late Austro-libertarian economist and historian Murray Rothbard. The following passages are from his 1961 review of Karl Polanyi’s The Great Transformation, a review published in 2009 in Roberta Modugno, ed., Rothbard vs. The Philosophers. It highlights a basic truth about which Mr. Ferrara and his sources have virtually nothing to say:
It was population growth . . . that was wrecking mercantilist Europe. Population growth was the reason for the rise of able-bodied beggars and thieves in eighteenth-century England. There was no work for them to do. It was the rise of capitalism—the advance of capital to provide them with jobs, the expansion of the market to produce cheap goods for the masses—that not only enormously increased the standard of living of the masses but also provided jobs for these increasingly “excess” people.
Furthermore, Polanyi continues the old anti-capitalist canard that the Industrial Revolution was made possible by the enclosure movement, which supposedly drove sturdy yeomen off their lands and into the cities.
This is nonsense; not only did the enclosure movement enclose the “commons” and not people, and by the great increase in agricultural productivity provide the wherewithal in resources and income for the Industrial Revolution, but also the enclosures did not drive people off the land. The surplus population in the rural areas was a consequence of population growth; it was this increase in rural population that drove these desperate people into the cities to look for work.
Capitalism did not, therefore, tragically disrupt, as Polanyi would have it, the warm, loving, “social” relations of pre-capitalist era. Capitalism took the outcasts of society—the beggars, the highwaymen, the rural overpopulated, the Irish immigrants—and gave them the jobs and wages that moved them from destitution to a far higher standard of living and of work.
It is easy enough to wring one’s hands at the child labor in the new British factories; it is, apparently, even easier to forget what the child population of rural England was doing before the Industrial Revolution—and during the Industrial Revolution, in those numerous areas of England where it and the new capitalism had not yet penetrated: these children were dying like flies and living in infinitely more miserable conditions. (pp. 127-128)
On the matter of dying like flies: we need to consider a story, germane to the case we are progressively making on this blog, that predates the Industrial Revolution by over a century. If ever there were an anti-life phenomenon in the history of Europe, it was the mid-Fourteenth Century bubonic plague pandemic, often referred to as the Black Death, which more or less halved that continent’s population. Earlier in that century, however, another anti-life force had lowered the European standard of living, thus facilitating, among other things, the proliferation of the Yersinia pestis microparasite.
We refer to the incipient modern nation-state, embodied most notably in Philip the Fair of France, who more than any other “civil magistrate” (the Theologically Correct euphemism for Plunderer-in-Chief) up-ended the balance that had hitherto obtained between Church and State. (Inevitable, in our opinion, whenever one attempts to strike a “balance” with an instrinsically evil institution.) The result was the subsequent subordination of Church to State, papal bulls to the contrary notwithstanding. And all this was in full swing long before Henry VIII, Martin Luther, John Locke, and the other usual suspects of Mr. Ferrara’s anti-capitalist propaganda. Indeed, Fourteenth Century France was the heyday of those guilds of Bellockian romance (or corps de métiers, as they were called there).
Philip the Macroparasite’s edictsimperialistic, anti-trade (specifically against the international Fairs of Champagne), direct and indirect (via inflation) taxation, combined with outright confiscations too numerous to list here—contributed decisively to the secular decline that had substantially decreased the population long before the arrival of the Asiatic microparasites that finished the job.
No one has told this story more compellingly and concisely than did Rothbard in his magisterial An Austrian Perspective on the History of Economic Thought, vol. 1, Economic Thought Before Adam Smith. Now, you can take that link to the text of the whole volume and search for pages 68-69. Or, you can click on LewRockwell.com to read the passage in question. But in case some of you are thinking, “OK. Maybe I’ll check that out later,” we are immediately appending this literary treat.

The Great Depression of the 14th Century
Murray N. Rothbard

Most people–historians not excepted–are tempted to think of economic and cultural progress as being continuous: in every century people are better off than in the one preceding. This comforting assumption had to be given up quite early when the Dark Ages ensued after the collapse of the Roman Empire. But it was generally held that after the "renaissance" of the 11th century, progress in western Europe was pretty well linear and continuous from that point to the present day. It took heroic efforts over many decades for economic historians like Professors Armando Sapori and Robert Sabatino Lopez to finally convince the historical profession that there was a grave secular decline in most of western Europe from approximately 1300 to the middle of the 15th century; a period which might be called the Late Middle Ages or the Early Renaissance. This secular decline, mistitled a "depression," permeated most parts of western Europe with the exception of a few Italian city-states.
The economic decline was marked by a severe drop in population. Since the 11th century, economic growth and prosperity had pulled up population figures. Total population in western Europe, estimated at 24 million in the year 1000 AD, had vaulted to 54 million by the year 1340. In little over a century, from 1340 to 1450, however, the western European population fell from 54 million to 37 million, a 31 percent drop in only a century.
The successful battle to establish the fact of the great decline has done little, however, to establish the cause or causes of this debacle. Focus on the devastation caused by outbreaks of the Black Death in the mid-14th century is partially correct, but superficial, for these outbreaks were themselves partly caused by an economic breakdown and fall in living standards which began earlier in the century. The causes of the great depression of western Europe can be summed up in one stark phrase: the newly imposed domination of the State. During the medieval synthesis of the High Middle Ages there was a balance between the power of Church and State, with the Church slightly more powerful. In the 14th century that balance was broken, and the nation-state came to hold sway, breaking the power of the Church, taxing, regulating, controlling and wreaking devastation through virtually continuous war for over a century (the Hundred Years' War, from 1337 to 1453).
[The population decline was roughly uniform throughout western Europe, with the Italian population falling from 10 to 7.5 million, France and the Netherlands from 19 to 12 million, Germany and Scandinavia from 11.5 to 7.5 million, and Spain from 9 to 7 million. The largest percentage drop was in Great Britain, where the number of inhabitants fell from 5 to 3 million in this period.]
The first and critically most important step in the rise in the power of the State at the expense of crippling the economy was the destruction of the fairs of Champagne. During the High Middle Ages, the fairs of Champagne were the main mart for international trade, and the hub of local and international commerce. These fairs had been carefully nurtured by being made free zones, untaxed or unregulated by the French kings or nobles, while justice was swiftly and efficiently meted out by competing private and merchants' courts. The fairs of Champagne reached their peak during the 13th century, and provided the center for land-based trade over the Alps from northern Italy, bearing goods from afar.
Then, in the early 14th century, Philip IV, the Fair, king of France (1285–1314), moved to tax, plunder, and effectively destroy the vitally important fairs of Champagne. To finance his perpetual dynastic wars, Philip levied a stiff sales tax on the Champagne fairs. He also destroyed domestic capital and finance by repeated confiscatory levies on groups or organizations with money. In 1308, he destroyed the wealthy Order of the Templars, confiscating their funds for the royal treasury. Philip then turned to impose a series of crippling levies and confiscations on Jews and northern Italians ("Lombards") prominent at the fairs: in 1306, 1311, 1315, 1320 and 1321. Furthermore, at war with the Flemings, Philip broke the long-time custom that all merchants were welcome at the fairs, and decreed the exclusion of the Flemings. The result of these measures was a rapid and permanent decline of the fairs of Champagne and of the trading route over the Alps. Desperately, the Italian city-states began to reconstitute trade routes and sail around the Straits of Gibraltar to Bruges, which began to flourish even though the rest of Flanders was in decay.
It was particularly fateful that Philip the Fair inaugurated the system of regular taxation in France. Before then, there were no regular taxes. In the medieval era, while the king was supposed to be all-powerful in his own sphere, that sphere was restricted by the sanctity of private property. The king was supposed to be an armed enforcer and upholder of the law, and his revenues were supposed to derive from rents on royal lands, feudal dues and tolls. There was nothing that we would call regular taxation. In an emergency, such as an invasion or the launching of a crusade, the prince, in addition to invoking the feudal duty of fighting on his behalf, might ask his vassals for a subsidy; but that aid would be requested rather than ordered, and be limited in duration to the emergency period.
The perpetual wars of the 14th and the first half of the 15th centuries began in the 1290s, when Philip the Fair, taking advantage of King Edward I of England's war with Scotland and Wales, seized the province of Gascony from England. This launched a continuing warfare between England and Flanders on the one side, and France on the other, and led to a desperate need for funds by both the English and the French Crowns.
The merchants and capitalists at the fairs of Champagne might have money, but the largest and most tempting source for royal plunder was the Catholic Church. Both the English and French monarchs proceeded to tax the Church, which brought them into a collision course with the pope. Pope Boniface VIII (1294–1303) stoutly resisted this new form of pillage, and prohibited the monarchs from taxing the Church. King Edward reacted by denying justice in the royal courts to the Church, while Philip was more militant by prohibiting the transfer of Church revenue from France to Rome. Boniface was forced to retreat and to allow the tax, but his bull Unam Sanctam (1302) insisted that temporal authority must be subordinate to the spiritual. That was enough for Philip, who boldly seized the pope in Italy and prepared to try him for heresy, a trial only cut off by the death of the aged Boniface. At this point Philip the Fair seized the papacy itself, and brought the seat of the Roman Catholic Church from Rome to Avignon, where he proceeded to designate the pope himself. For virtually the entire 14th century, the pope, in his "Babylonian captivity," was an abject tool of the French king; the pope only returned to Italy in the early 15th century.
In this way, the once mighty Catholic Church, dominant power and spiritual authority during the High Middle Ages, had been brought low and made a virtual vassal of the royal plunderer of France.
The decline of Church authority, then, was matched by the rise in the power of the absolute State. Not content with confiscating, plundering, taxing, crushing the fairs of Champagne, and bringing the Catholic Church under his heel, Philip the Fair also obtained revenue for his eternal wars by debasement of the coinage and thereby generated a secular inflation.
The wars of the 14th century did not cause a great deal of direct devastation: armies were small and hostilities were intermittent. The main devastation came from the heavy taxes and from the monetary inflation and borrowing to finance the eternal royal adventures. The enormous increase of taxation was the most crippling aspect of the wars. The expenses of war: recruitment of the modestly sized army; payments of its wages; supplies; and fortifications–all cost from two-to fourfold the ordinary expenses of the Crown. Add to that the high costs of tax assessment and enforcement and the cost of the loans, and the crippling burden of war taxation becomes all too clear.
The new taxes were everywhere. We have seen the grave effect of taxes on the Church; on a large monastic farm, they often absorbed over 40 percent of the net profits of the farm. A uniform poll tax of one shilling, levied by the English Crown in 1380, inflicted great hardship on peasants and craftsmen. The tax amounted to one month's wages for agricultural workers and one week's wages for urban laborers; moreover, since many poor workers and peasants were paid in kind rather than money, amassing the money to pay the tax was particularly difficult.
Other new taxes levied were ad valorem on all transactions; taxes on wholesale and retail beverages; and levies on salt and wool. To combat evasion of the tax, the governments established monopoly markets for the sale of salt in France and "staple points" for English wool. The taxes restricted supply and raised prices, crippling the critical English wool trade. Production and trade were hampered further by massive requisitions levied by the kings, thus causing a drastic fall of income and wealth, as well as bankruptcies among the producers. In short, consumers suffered from artificially high prices and producers from low returns, with the king bleeding the economy of the differential. Government borrowing was scarcely more helpful, leading to repeated defaults by the kings and consequent heavy losses and bankruptcies among the private bankers unwise enough to lend to the government.
Originating as a response to wartime "emergency," the new taxes tended to become permanent: not only because the warfare lasted for over a century, but because the State, always on the lookout for an increase in its income and power, seized upon the golden opportunity to convert wartime taxes into a permanent part of the national heritage.
From the middle to the end of the 14th century, Europe was struck with the devastating pandemic of the Black Death–the bubonic plague–which in the short span of 1348–1350 wiped out fully one-third of the population. The Black Death was largely the consequence of people's lowered living standards caused by the great depression and the resulting loss of resistance to disease. The plague continued to recur, though not in such virulent form, in every decade of the century.
Such are the great recuperative powers of the human race that this enormous tragedy caused virtually no lasting catastrophic social or psychological effects among the European population. In a sense, the longest-lasting ill effect from the Black Death was the response of the English Crown in imposing permanent maximum wage control and compulsory labor rationing upon English society. The sudden decline of population and consequent doubling of wage rates was met by the government's severe imposition of maximum wage control in the Ordinance of 1349 and the Statue of Labourers of 1351. Maximum wage control was established at the behest of the employing classes: large, middle, and small landlords, and master craftsmen, the former groups in particular alarmed at the rise of agricultural wage rates. The ordinance and the statute defied economic law by attempting to enforce maximum wage control at the old pre-plague levels. The inevitable result, however, was a grave shortage of labor, since at the statutory maximum wage the demand for labor was enormously greater than the newly scarce supply.
Every government intervention creates new problems in the course of vain attempts to solve the old. The government is then confronted with the choice: pile on new interventions to solve the inexplicable new problems, or repeal the original intervention. Government's instinct, of course, is to maximize its wealth and power by adding new interventions. So did the English Statute of Labourers–which imposed forced labor at the old wage rates for all men in England under the age of 60, restricted the mobility of labor, declaring that the lord of a particular territory had first claim on a man's labor, and made it a criminal offence for an employer to hire a worker who had left a former master. In that way, the English government engaged in labor rationing to try to freeze laborers at their pre-plague occupations at pre-plague wages.
This forced rationing of labor cut against the natural inclination of men to leave for more employment at better wages, and so the inevitable rise of black markets for labor made enforcement of the statutes difficult. The desperate English Crown tried once again, in the Cambridge Statute of 1388, to make the rationing more rigorous. Labor mobility of any sort was prohibited without written permission from local justices, and compulsory child labor was imposed in agriculture. But there was continual evasion of this compulsory buyers' cartel, especially by large employers, who were particularly eager and able to pay higher wage rates. The cumbersome English judicial machinery was totally ineffective in enforcing the legislation, although the monopolistic urban guilds (monopolies enforced by government) were able to partially enforce wage control in the cities.

July 18, 2011

The Eminently Real Free Market (XVII): Sketchy Stories (6): If I Had a Hammer: Hayek on Tool-Ownership

Before turning to Hayek, we urge upon our visitors a paper that highlights aspects of the enclosure movement that the pro-life “angle” of our post of yesterday’s date crowded out.
That 2007 paper, “Chesterton and Belloc: A Critique,” was jointly authored by Marcus Epstein, Walter Block, and Thomas Woods. Tom linked to it today on his blog where, once again, he generously linked to three posts on ours. We cannot recommend that paper too highly, as it not only complements but supplements what we have attempted here on this question. It belongs on any reading list preparatory of our eventual examination of Distributism.
Because Mr. Ferrara has bound himself to Hilaire Belloc’s century-old historiography, he cannot countenance research that puts the origin of the enclosure movement in England (a) a full century earlier (and therefore before the Industrial Revolution that allegedly evacuated the fields and pauperized their former proprietors) and (b) in a common law context of private agreements predating the statist parliamentarian process that popular writers traditionally focused on. And so, the authors of that paper write:
J. R. Wordie [in a 1983 paper published in a peer reviewed journal] has concluded that by 1760 some 75 percent of English land was already enclosed and that contrary to the earlier [but superceded scholarly] consensus [which Mr. Ferrara & Co. presuppose to be true], it was not during the eighteenth century but during the seventeenth that “England swung over from being mainly an open-field country to being a mainly enclosed one.” Thus, the bulk of enclosure had long since been accomplished by the time Belloc and other distributists seem to have thought it was busy creating the industrial proletariat. Moreover, the tenants themselves often initiated the enclosure, again contrary to the impression Belloc left, and even parliamentary enclosure operated on the basis of consensus.
We close this preface to Hayek’s contribution with a quote from Tom’s post (entitled, "Propaganda, Meet Modern Research"):
The enclosure movement was in fact not a single movement and was in some cases not a “capitalist” phenomenon at all, so it’s not clear what Ferrara would have proven by citing it even if he had gotten the history right. But, as usually happens when you ignore the past 50 years of scholarship, he got it dreadfully wrong. (I guess those PhD’s who blurbed the book hadn’t read much about this, either.)
Now, about the “propertyless paupers” of Mr. Ferrara’s solicitude, Hayek wrote in his own contribution to the previously cited volume:
Discussions of the effects of the rise of modern industry on the working classes refer almost always to the conditions in England in the first half of the nineteenth century; yet the great change to which they refer had commenced much earlier and by then had quite a long history and had spread far beyond England. The freedom of economic activity which in England had provide so favorable to the rapid growth of wealth was probably in the first instance an almost accidental by-product of the limitations which the revolution of the seventeenth century had placed on the powers of government; and only after its beneficial effects had come to be widely noticed did the economists later undertake to explain the connection and to argue for the removal of the remaining barriers to commercial freedom. “History and Politics,” F. A. Hayek, ed., Capitalism and the Historians, The University of Chicago Press, 1954, p. 14. (Available through Amazon or the Mises Bookstore.)
Self-interested lords may have intended only to assert their own interests against the monarch, but they unleashed a wave of "beneficial effects" that many beyond them enjoyed. The prescient among them, including some economists, thought it would be good to "roll out" the idea of limited government even further. But Mr. Ferrara's emphasis on tool-ownership--"the few . . . in possession of the means of production”--is a Distributist “tell” that merits a comment (in advance of a fuller examination later).
We know there are environmentalists who prefer fewer human beings enduring a subsistence-level (but environmentally “sustainable”) standard of living to more people enjoying better and longer lives at the “expense” of nature. Can it be that Distributists prefer numerically fewer serfs who at least owned their own tools, to many factory workers, if they had to choose between these two scenarios?
But what about those tools? Hayek again:
The actual history of the connection between capitalism and the rise of the proletariat is almost the opposite of that which these theories of the expropriation of the masses suggest. The truth is that, for the greater part of history, for most men the possession of the tools for their work was an essential condition for survival or at least for being able to rear a family. The number of those who could maintain themselves by working for others, although they did not themselves possess the necessary equipment, was limited to a small proportion of the population. The amount of arable land and of tools handed down from one generation to the next limited the total number who could survive. To be left without them meant in most instances death by starvation or at least the impossibility of procreation.
In short, there is an intimate connection between human economic productivity and human biological “reproductivity,” and one is a function of another. Hayek continues:
There was little incentive and little possibility for one generation to accumulate the additional tools which would have made possible the survival of a large number of the next, so long as the advantage of employing additional hands was limited mainly to the instances where the division of the tasks increased the efficiency of the work of the owner of the tools. It was only when the larger gains from the employment of machinery provided both the means and the opportunity for their investment that what in the past had been a recurring surplus of population doomed to early death was in an increasing measure given the possibility of survival.
It is hard not to hear in Hayek’s reference to “a recurring surplus of population” an implicit answer to Scrooge’s unwanted Christmas Eve visitor who informed the miser that many poor men “would rather die” than avail themselves of whatever assistance could be gotten from the “prisons” and the “workshops.” Scrooge coldly rebuffs him with “If they would rather die, they'd better do it, and decrease the surplus population.” Ironically, what members of Scrooge’s class had been doing for the past century, whether they intended to or not, whether their moral character mirrored or diverged from Scrooge’s, was effectively ensuring that great numbers of human beings, once deemed “surplus,” would no longer be “doomed to an early death.” Hayek elaborates upon the pro-life import of this development:
Numbers which had been practically stationary for many centuries began to increase rapidly. The proletariat which capitalism can be said to have “created” was thus not a proportion of the population which would have existed without it and which it had degraded to a lower level; it was an additional population which was enabled to grow up by the new opportunities for employment which capitalism provided.
An historical movement that enhanced human fruitfulness, enabling a heretofore doomed “surplus” of human beings to “grow up,” may be called “Satanic” only in propaganda that trades on the ignorance of its target audience.
In so far as it is true that the growth of capital made the appearance of the proletariat possible, it was in the sense that it raised the productivity of labor so that much larger number of those who had not been equipped by their parents with the necessary tools were enabled to maintain themselves by their labor alone; but the capital had to be supplied first before those were enabled to survive who afterward claimed as a right a share in its ownership. Although it was certainly not from charitable motives, it still was the first time in history that one group of people found it in their interest to use their earnings on a large scale to provide new instruments of production to be operated by those who without them could not have produced their own sustenance.
But everyone knows that capitalism is nothing but the concentration of wealth in the hand of a few to the detriment of the many . . . or so goes the Marxist-Distributist fractured fairytale. That’s their story, and they’re sticking to it.
To Be Continued

July 17, 2011

The Eminently Real Free Market (XVI): Sketchy Stories (5): A Pro-Life Lesson Missed

Mr. Ferrara adds color to his narrative by alluding to (and sourcing in a reference note) William Blake’s “dark Satanic Mills.” (Blake used capitals in the original.)
The English Civil War (1641-51) and the “Glorious Revolution” of 1688 had made England into a capitalist nation of Whig oligarchs long before the “dark satanic mills” of the Industrial Revolution began to operate.” (15)
He elaborates:
The famous phrase from an untitled poem by William Blake (now known as “Jerusalem”) and generally interpreted as a comment upon the Industrial Revolution in light of a legend that Jesus once visited England and will return to rebuild a new Jerusalem there. (329 n. 8)
His invocation of the visionary poet is itself poetic, for there is as much evidence for the thesis that Jesus once visited England as there is for the opinion that “dark Satanic Mills” truthfully symbolizes the import of  “capitalism”1 for the masses.
Satan is the enemy of life and liberty, yet with the help of those mills and kindred inventions, these blessings increased unprecedentedly in this period, and rained on the just and the unjust alike, whether that is what “Whig oligarchs” intended or not. Like E. J. Hobsbawn’s Captain Swing, E. P. Thompson’s The Making of the English Working Class and other superceded Marxist accounts,2 Mr. Ferrara’s tale (which relies more on the virtually obsolete work of the Hammonds’ 1911 The Village Labourer) suffers from ideologically inspired oversights.
Mr. Ferrara’s first thesis is expressed in a characteristic run-on sentence:
The pauperization [allegedly “resulting” from the “theft and later enclosure of former Church properties in England”] of English commoners gave rise to the regime of the Poor Laws of four centuries’ duration, making post-Henrican England the first “welfare state” in Western history—a development unknown during all the centuries of Christendom, with its vast network of charitable institutions. (14-15)
Let’s see . . . swift, violent, and uncompensated royal theft is lumped together in one breath with protracted, partially compensated2 parliamentary enclosure . . . and this compound crime “results” in a pauperization in England that “gives rise to” four hundred years (which four hundred?) of a Poor Law-codified welfare state (excuse me, “welfare state”) . . . and the latter compares unfavorably with Christendom’s charitable institutions. Such talking-in-one’s-sleep hardly rises to the dignity of an historical “sketch.”3
That the poor were starting to live long enough to fall under Poor Law consideration is another salient point Mr. Ferrara fails to notice. More on that aspect presently. He once again draws upon the writings of mutualist libertarian Kevin Carson :
. . . [T]he State’s theft of Church lands [Mr. Ferrara writes] in favor of early English capitalists began at the very time abuses of the “feudal” system were “in the process of being remedied.” Western Europe [according to Mr. Carson] “was evolving toward a system in which the peasant was a de facto owner, required, required to pay only a nominal quit-rent set by custom; after that nominal rent was paid, he could treat the land in practice as his own. Had that system been allowed to develop without violence, Europe today might be a continent of small proprietors.” [15. Mr. Ferrara italicizes the last nine words without telling the reader there that he has done so.—A. F.]
Yes, imagine how Europe might have developed without State violence. Thank you, Mr. Carson.
To belabor what should be obvious: Anarcho-Catholics categorically deplore all State theft, including Henry’s theft of monastic lands. Is that news to anyone? How statist thieves reward their friends and punish their enemies is both an ancient and contemporary theme. So is the vexed question of restitution (or reparations) based on the discovery of just title and unjust holdings.
They bear not at all, however, on the empirical question of whether free markets—that is, markets in their catallactic, non-politically perverted dimension—have improved the lives of all whom they touch. And by “improve” we emphatically include, “increase the quantity as well as quality of.” Markets manage to do this regardless of the interference of political interest. The desideratum is always to eliminate the interference.
Mr. Ferrara’s reference to Blake immediately followed a telling quote from Distributism’s godfather, Hilaire Belloc:
. . . [T]he end result of Henry’s theft from the Church [Mr. Ferrara writes] was that the beneficiaries of his theft became “a powerful oligarchy of large owners, overshadowing dwindled monarchy.” [15. The quote is from Belloc’s The Servile State.—A. F.]
Insofar as the Gospel slowly but surely influenced the ethos of Europe, from the eighth through the tenth centuries, it was no doubt a factor in the progressive correction of Mr. Carson’s “abuses of the feudal system,” the evolution of the de facto slave into a less “servile” serf. Mr. Ferrara’s Bellockian thesis, however, is that “capitalism” derailed this progress to the serf’s harm by devolving him into a “servile” factory worker, who is a virtual slave with no means of production of his own that would enable him to assert his independence.
In the light of that devolution, we find it ironic to sense Belloc’s implicit shedding of a tear for a “dwindled” monarchy, suggesting that an “undwindled monarchy” would have been the champion of the interests of the progressively evolving serf. In fact, raw, unbridled power in the hands of a tyrant initiated the theft that set the catastrophe in motion, as Belloc defined catastrophe. Or have we forgotten so soon about those hapless English monks?
Even though the parliamentarians who “overshadowed” the dwindled monarch were mostly anti-Catholic heirs of stolen Catholic lands, Anarcho-Catholics remind the reader that Henry no more intended to benefit those Whig heirs than Whigs intended to benefit the masses who worked for them. And given that the theft cannot be undone, what transpired afterwards?
Mr. Ferrara continues:
By the turn of the 18th century, “more than half of the English were dispossessed of capital and land. Not one man in two . . . inhabited a house of which he was the secure possessor, or tilled land from which he could not be turned off.” (Quoting from Belloc, The Servile State.)
And turned off he was. By means of thousands of privately initiated parliamentary acts of enclosure in the 18th century, the heirs of the new “owners” of the stolen lands of the Church converted them into “private property” in the modern sense, thereby creating a vast dispossessed class of propertyless paupers whose only means of survival was wage labor in factories for the able-bodied, including women and children. The few tenants remaining on the land, and thus in possession of means of production, suffered the imposition of “rack rents” more burdensome than any feudal levies. (15)
The parliamentary acts of enclosure were initiated at the behest of private interests, but facilitated by the State, without which it would have happened, if it did, very differently. (How “secure” were the Catholic monks who were unceremoniously “turned off” their lands by an “undwindled” monarch?)
The dispossessed class was vast because the death rate dropped and so many more ordinary people than ever lived to have children of their own. How does Mr. Ferrara account for that demographic effect, assuming he is aware of it? We charitably assume it matters to a pro-life lawyer which conditions are conducive to human fecundity and which are not.
As the historian T. S. Aston put the question:
Whether it is good or ill that more human beings should experience the happiness and misery, the hopes and anxieties, the ambitions and frustrations of life, may be left for the philosopher or the theologian to determine. But the increase in number was the result not of a rise of the birth rate but of a fall of the death rate, and it might be thought that this was indicative of an improved quality of life. “The Standard of Life of the Workers in England, 1790-1830,” in F. A. Hayek, ed., Capitalism and the Historians, The University of Chicago Press, 1954, p. 127. (Available through Amazon or the Mises Bookstore.)
“Be fruitful and multiply,” anyone? (Genesis 1:28) It was only until the much-maligned period of the Industrial Revolution and freer markets that  God's image-bearers could, in effect, fulfill this Edenic imperative. That pagan environmentalists curse capitalism is understandable. Catholics have good reason not to join them.
To Be Continued

1 “In many ways it is misleading to speak of ‘capitalism’ as though this had been a new and altogether different system which suddenly came into being toward the end of the eighteenth century; we use this term here because it is the most familiar name, but only with great reluctance, since with its modern connotations it is itself largely a creation of that socialist interpretation of economic history with which we are concerned. The term is especially misleading when, as it often the case, it is connected with the idea of the rise of the propertyless proletariat, which by some devious process have been deprived of their rightful ownership of the tools for their work.” “History and Politics,” F. A. Hayek, ed., Capitalism and the Historians, The University of Chicago Press, 1954, pp. 14-15. (Available through Amazon or the Mises Bookstore.)
We concur with Hayek: we’re stuck with the term “capitalism” (NB: not “capitalist,” the owner of capital), coined in the mid-nineteenth century by various socialists, e.g., Douai, Proudhon, Blanc, and decisively given currency by, of course, Marx and Engels.
2 “Many years have elapsed since the standard histories of the agricultural labourer first saw the light of day, and they are decidedly outdated. It is true, several valuable contributions seeking to examine aspects of the labourer's position have appeared in academic journals and elsewhere, written by scholars with a specialist knowledge of agrarian or demographic change. Yet until they are satisfactorily integrated, popular impressions will continue to be shaped by writers who follow the tradition, set by the Hammonds, of giving excessive emphasis to institutional influences and concentrating upon colourful episodes such as the Swing riots which seem capable of being explained to a large extent by short-period influences. Innocently or not, such historians serve to cloud rather than illuminate the underlying factors affecting the situation of the labourer, by neglecting or misinterpreting the more fundamental economic, technological and especially the demographic determinants of his standard of life and position in society.” W. A. Armstrong, “The Influence of Demographic Factors on the Position of the Agricultural Labourer in England and Wales, c1750-1914,” The Agricultural Historical Review, Vol. 29, 1981, pp. 71-82. Emphasis added. Available online.

Of course, what was written thirty years ago can hardly be considered the last word, but it is the burden of those who wish to promote “popular impressions” to inquire whether the studies Armstrong refers to have been “satisfactorily integrated” and whether the results restore confidence in those impressions and reverse his judgment. A cursory glance indicates otherwise. As of 2000, at least, Armstrong’s research is cited in E. J. T. Collins’ The Agrarian History of England and Wales, the long “missing” seventh volume of the eight-volume definitive study (General Editor: Joan Thirsk), which the Cambridge University Press began publishing in 1967.
3 Again, lest we be misunderstood: whether legally compensated or not, whether royally decreed or legislated by parliament, confiscation is a case of the initiation of force and is therefore unjust. Period. No subsequent monetary payment retroactively justifies theft. The victims of outright theft and of enclosure had qualitatively different experiences, however, and no narrative should conflate them. His hyperbole will come under scrutiny again when we turn to Mr. Ferrara’s quasi-Marxist condemnation of “wage slavery.”
4 One dimension missing from Mr. Ferrara’s picture is the role of popes in legitimizing "Henrican England." There were, for example, the intertwined geopolitical machinations of one lord of Christendom, Pope Julius II (of “Holy League” fame), with those of Henry VIII, the totalitarian Tudor to whom His Holiness had granted a dispensation to marry his brother’s widow (at the urging of her mother, Christendom’s Isabella I of Castile!). Another Vicar of Christ, Julius’ Medici-born successor, Leo X, had dubbed that same tyrant Defensor Fidei for repudiating Martin Luther, whom Henry would soon rival in expression of anti-Catholic ferocity.

July 12, 2011

The Eminently Real Free Market (XV): Sketchy Stories (4)

In tabloid-style Mr. Ferrara wraps his conflation of the complex topics of land seizure and land enclosure in an insinuation of guilt by association.
The theft and later enclosure of former Church properties in England, the cradle of capitalism and the Industrial Revolution (roughly 1760-1830), is preeminently illustrative of the process. (14)
What is preeminently illustrative here is Mr. Ferrara’s propagandistic approach to history. His reference to “capitalism and the Industrial Revolution” is a muddle: England may have been the “cradle” of the latter, but certainly not the former. “Capitalism” has a broader reference, one that expands or contracts depending on one’s theoretical framework, scientific purpose, or ideological interest.
Capital accumulated on more or less free markets in Catholic Europe for centuries before the Industrial Revolution. That the Catholic worldview was a vital, indispensable spiritual component of the success of markets in Europe (their having been stymied everywhere else in the world) is the thesis of Rodney Stark’s The Victory of Reason: How Christianity Led to Freedom, Capitalism, and Western Science. We encourage our readers to read Tom Woods’s review of it in The Independent Review.
Ontologically, markets are networks, which consist of nodes and ties. The nodes of the market are Good Life-seeking persons, and their mutual ties are offers of goods and services and responses thereto. Free persons—strictly speaking, persons to the degree that they are free from the coercion of others—spontaneously generate markets, which are as real as they are. This is the reality Mr. Ferrara systematically obscures with his baseless suggestion that Austro-libertarians are apologists for mercantilism and its variants. Mr. Ferrara’s failure to show that Austro-libertarians support such interference renders his gallery of “illustrations” utterly off-topic and useless to his polemical purpose.
His omission of evidence of explicit and long-standing Austro-libertarian opposition to mercantilism, however, is a more serious ethical lapse. (His citing of Kevin Carson’s diagnosis of ideologically inspired “forgetfulness” hardly discharges Mr. Ferrara’s duties in this regard.) In our current mini-series, “Sketchy Stories,” we are merely pointing this out over and over. We are under no illusion, however, that our efforts will have any effect on Mr. Ferrara’s future writings.
Austro-libertarians—that is, supporters or practitioners of Austrian economics on their anti-political side—are morally opposed to interference in markets wherever or by whose agency it has occurred. Contemplated interference with markets, however, with or without the assistance of the state, presupposes markets that are already in operation. Markets form the natural order of producers offering goods and customers responding to those offers; the exploitation of market participants, unnatural disorder. Historically those traders were from different countries, speaking different languages, using different currencies, and taking varying amounts of time to fulfill contracts. These flesh-and-blood historical actors generated the distinctive ethical problems (the just price, the charging of interest on a loan, etc.) that Catholic casuists, preeminently the scholastics of the School of Salamanca, addressed. In the eighth chapter of his How the Catholic Church Built Western Civilization, Tom Woods traces theoretical differences in economic understanding, from the Fourteenth to the Eighteenth Centuries, to divergent theological ideas of the nature and purpose of human labor. Unfortunately for Mr. Ferrara’s project, they divide along Catholic and Protestant lines, with his own labor-glorifying emphasis clearly aligned with the latter. But let us not get ahead of our story.
To Be Continued