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even when there has been no negligence on his own part, and even when the accident has been due to the neglect of the injured workman himself, except only in cases of "serious and willful misconduct." This principle now applies also to agriculture, shipping, and mercantile and domestic employments, and certain trade diseases have been made to count as accidents.

(3) Labor Organizations. — Modifications in the working of free competition have also been effected by the voluntary organization of the worker, not only by their influence upon legislation, but also by direct dealings with employers. We have noticed the gilds, which played a large part in the history of the middle ages. These, however, were not like modern trades unions. They were unions of men who worked, but not exclusively of wage earners, nor in the interests of wage earners even chiefly. They were formed of masters. But combinations of the wage-earning classes are found long before the Industrial Revolution. They do not become prominent, however, until the nineteenth century. Laws prohibiting the combination of laborers had been passed at intervals since the middle ages, and in 1800 Parliament, finding that unions were increasing, passed a most comprehensive law to suppress them, declaring illegal "all agreements between journeymen and workmen for obtaining advances of wages, reductions of hours of labor, or any other changes in the conditions of work." Under this law many workmen were prosecuted and severely punished, but in vain. In 1824 Parliament confessed the law a mistake, and repealed it along with previous laws relating to combinations of workmen. Trades unions thus tolerated grew at an astonishing rate, but they were still subject to legal persecution. Judicial decisions, especially, were adverse to them, as the courts regarded them as agreements in restraint of trade. But in 1871 a law was passed which declared that the purposes and actions of trades unions were not to be deemed unlawful as being in the restraint of trade, and in 1875 the legality of trades unions was still further recognized by the provision that acts which were not punishable as crimes when done by one person should not be indictable as conspiracy when done by two or more in furtherance of trade dispute, and finally, in 1906, the courts were forbidden to entertain

actions for damages against trades unions. In this same year peaceful picketing was legalized.

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(4) The Extension of Government Enterprise. The reaction against a laissez-faire policy is further shown by a growth in the sphere of industry directly managed by the government. We find municipalities operating street railways and furnishing water, gas, and electric light. Municipal enterprise includes also in various places markets, docks, dwellings, baths, race courses, oyster fisheries, slaughterhouses, milk depots, employment bureaus, sewage farms, theaters, and many other lines of activity. Again, the national government conducts the postal savings banks, the parcels post, and the telegraph and telephone systems.

Summary. In this chapter a brief sketch has been given of England's attempt to deal with a new set of forces. An immense increase in production has taken place, due in part to competition, more to machinery. But the distribution of this wealth, growing directly out of the principles of competition so long as they were unrestrictedly applied, was such that poverty grew rapidly, and some said even faster than wealth, and the laboring population of the realm sank into deeper distress and degradation. The partial benevolence of employers, which would fain have mitigated this disaster, was, as a rule, neither welcomed nor tolerated by the competition which had made itself law. Not until this benevolence was formulated, generalized, and enforced by disinterested legislation was the horror of the situation diminished. When we hear the principle of "a fair field and no favor" and "no State intervention" advocated by a man strong in the consciousness of personal advantages, we must remember that he is a century behind his time, and that he has not read or has not profited by one of the most dolorous chapters in human history. The English nation, after a trial of free competition and no interference, as thorough as could well be made, has undeniably returned to the principle of governmental activity which she had abandoned, -a principle which recognizes as the function of the State the protection of the citizens, and the furtherance of their material and social well-being, by every law and every activity which offers a reasonable guarantee of contributing to that end. It is to be noticed fur

thermore that, as a matter of fact, all this activity of the State contributing to material and social well-being has also increased freedom as a positive, constructive force. It has promoted the growth of individual powers and enlarged the scope of activity of the average citizen. It has not tended to slavery, as Herbert Spencer long ago maintained, but its tendency has been in the direction of the sort of liberty that is really worth while; namely, liberty as a power of development and of contributing (in the words of the philosopher T. H. Green) to the "common good."

QUESTIONS AND EXERCISES

1. What is the origin of the term “laissez-faire”?

2. What laws are in force in your state regarding the inspection of food and other articles offered for sale?

3. Give a detailed account of the development of one of the great inventions.

4. Give a sketch of the enactment and repeal of the "corn laws."

5. Give an account of the development of monopolies and trusts in England.

REFERENCES

BEARD, C. The Industrial Revolution.

CHEYNEY, E. P. Industrial and Social History of England, Chaps. VIII

and IX.

CUNNINGHAM, W.

Growth of English Industry and Commerce, Modern
Laissez-Faire.

Times, Part II.
HOBSON, J. A. Evolution of Modern Capitalism, Chaps. III and IV.
Howe, F. C. "Municipal Ownership in Great Britain," Bulletin of the
United States Bureau of Labor, January, 1906.

HUTCHINS and HARRISON, A. A History of Factory Legislation, Chap. II. PRICE, L. L. Short History of English Commerce and Industry, Chaps. IX and X.

TAYLOR, H. C. "The Decline of Land-owning Farmers in England," Bulletin of the University of Wisconsin, Economics and Political Science Series,

No. 142.

TOYNBEE, A. The Industrial Revolution.

VEBLEN, T. B. The Theory of Business Enterprise, Chap. IV.

CHAPTER V

THE ECONOMIC DEVELOPMENT OF THE UNITED STATES

THE economic development of the United States has in some respects been very unlike the economic development of England, and yet very like it in other respects. Let us note in the first place the points of difference, the factors and characteristics of our economic history which are peculiarly American.

The transit

Economic Stages in American Industrial History. of civilization from Europe to America, as an American historian1 has finely phrased it, thrust the European laws, customs, and industrial technique of the seventeenth century into the primitive environment of a wilderness, and for the moment the wilderness dominated. Industry was forced to begin at the beginning and retrace as the child is said to retrace the mental development of mankind the industrial evolution of the race.

The American people have thus, during the comparatively brief historical period which has elapsed since the settlement of this country, run the whole gamut of industrial evolution, passing through with striking rapidity all the stages differentiated in the preceding chapters. There was slaughter of captives in the Indian wars, enslavement of Indians, particularly-but not onlyin the Spanish colonies, later the introduction of negro slavery and modified serfdom in the bond or indented servants, then the individual wage contract, still supreme among agricultural laborers, and finally, collective bargaining through the great trades unions of the present generations. In a similar way, practically all the stages differentiated in the table given on page 40 may be traced in the industrial evolution of the United States.

1 Edward Eggleston, Transit of Civilization, New York, 1900.

Naturally it is not to be supposed that American industrial society worked its own way unaided through all those economic stages which the race, with "painful steps and slow," has laboriously traversed in its upward march. Stimulated by European culture, we hurried through the earlier stages, for the most part, retracing them merely as an incident of frontier conditions, and skipping some such as the pastoral stage-in many sections of the country. On the other hand, it must not be inferred that we have everywhere passed beyond the so-called primitive stages. Barter is still the commonest mode of exchange in some parts of the country, and there are comparatively few rural districts in which credit transactions have in the main taken the place of money transactions. It is interesting to observe that, owing to the progressive Western movement of the population of the country, the stages in the history of man's productive efforts appeared in regular order from West to East. Thus, a few years ago, the country of the frontier was occupied by hunters and trappers; next were great stretches of country almost entirely devoted to grazing; farther east, agriculture predominated; trade and commerce were active, especially in the country east of the Mississippi; manufacture on a large scale was prominent in the North Atlantic and North Central groups of states; while finally the large industrial combinations which mark the latest step in development were confined (with respect to legal residence at least) to the Atlantic seaboard.

Sectionalism.

This phenomenon of the contemporaneous existence of several industrial stages, side by side, under the same government, has laid upon this country some of the hardest problems which it has had to solve. The ever present but ever receding frontier has continually created a set of interests antagonistic to those of the settled industrial and commercial communities. Shays's Rebellion in 1786 was in part a protest of the more thinly settled debtor communities against the determination of the commercial centers to introduce the sound currency which a developed commerce requires. The federal Constitution was adopted and the present government created in order, largely, to strengthen national credit, insure taxation, remove trade

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