It is difficult to find an example of price of wages which presents any difficulty of explanation when we apply to it the consideration of efficiencyefficiency

If bricklayers were to offer to exert themselves to the utmost, and do in eight hours the same amount and quality of work they now do in nine, the speculative builders would doubtless be willing to give the same wages for eight hours' work that they now give for nine bricklayers

• labourers

• speculative builders

• increased money wages

owing to the inefficiency of their labour inefficiency



	In case the labourers by increase in their efficiency are able to get higher wages, the choice will (in general) lie with them how much of the increase they take in increased money wages, how much they take in shortened hours of labour. We thus see how, in an uncivilised community

	owing to the inefficiency of their labour, their whole time and energies are expended on their hunting, or otherwise providing bare subsistence. The greater skill of our civilised labourers, working with machines provided by our science, and profiting by our fixed capital (as our railway tunnels and embankments), is vastly more efficient: it ensures the labourers a certainty and regularity of food which the savage does not enjoy, and provides him a certain margin of leisure beyond what the inefficient savage labourer can count upon; it also provides the whole surplus production out of which the intellectual and leisure classes are supported.

It may be shortly stated that in the old Protectionist theory, destroyed by Adam Smith, gold was considered to be wealth. Hence, if an individual bought foreign wheat for gold, the English suffered a national loss of wealth, and the foreign nation made a national gain. It is unnecessary to occupy space in refuting this (to us absurd) idea, as no refutation can be more satisfactory than Adam Smith's own.

It is to be noted that an increase of efficiency in any industry (and very largely in the case of industries producing generally essential utilities) raises real wages in all other industries, and this, whether the particular trade gains (as we have seen it nearly always do) or loses, as is conceivable, though rarely occurring. Thus, if the introduction of a boot-sewing machine lowers the price of boots 50 per cent, this can have no effect in lowering the money wages of farm labourers;

and, as a matter of fact, the fall in cost of boots has sensibly improved the position of farm labourers. In the same way the superior efficiency of carriers by railway over the old road carriers has diminished the cost of coal and all articles (the bulky ones most sensibly) in all parts of England. There thus arises the instructive result that handicrafts in which there has been no improvement in the last forty years have obtained a rise of real wages (amounting in some cases to 50 per cent) by the improvements in efficiency in all the trades around them.

To sum up: No man in ordinary business will give a price for anything that he intends to sell again unless he expects to profit by selling it again. No capitalist will pay a workman to make a table unless he expects to sell the table for a sum somewhat exceeding the cost of the wood and the workman's labour. It follows directly that the one grand object of the workman, both as an individual, a trade, and a class, should be to improve the efficiency of his labour. He may gain something by combination and higgling for the turn of the market, but the limit to what he can get is the value of his labour to his employer.

In order to attain this improved efficiency the most important practical aid is piecework. This has done much even in agriculture: the turnip-hoer by the acre earns more, while he does his work at his own time with more comfort to himself than the old day-labourer. What is more important, the men who by head and hand are superior at turnip-hoeing are able to do the work cheaper than ordinary labourers, and turnip-hoeing thus falls entirely to the most efficient hoers, whose efficiency thus again gets constantly improved.

There is no doubt to me that, if the London bricklayers would arrange to work by contract, they would soon obtain more wages without being compelled (as they imagine would be the case) to work more severely or longer hours to gain those wages. If they were more efficient, nothing could prevent the competition of employers soon giving extra wages for extra value of work.

Time and Date

But it may, finally, be urged that there is surely such a thing as over-production. If there is an over-production of boots, trade is flat, the wholesale dealers find they are making no profit, they stop their purchases, the workmen are thrown out of employ on a large scale. To this the reply is that there is almost a necessary alternation of up and down in every particular trade, whether the efficiency of the workmen is high or low. If trade is good, the large dealers will extend their purchases, and very commonly rather over-extend their purchases: a reaction follows, and _vice versa_ when trade is bad.

But it must be recollected over-production in all trades at once is impossible: capital is now not buried in pots by our great joint-stock banks;

if one trade is at standstill the capital is carried to the most remunerative use that the experienced bank secretaries can discover. If agriculture is, as we have lately seen it, in a depressed state for years, inasmuch as wheat is "over-produced" in America till the price in England falls to 36s. per quarter (and less), at which it hardly pays to produce it in England;

this of itself implies an enormous spur to all other industries--the real cost of labour has in them fallen (for the labourer will not be able to keep to himself the whole benefit of cheapened food)--the rate of profit in all other industries has risen (_pro tanto_). If we ever do arrive at a state when all the desires are fully satisfied--when there is over-production in all industries--we shall have general reduction in the hours of labour: "efficiency" will take that form.

Instead therefore of proceeding _upwards_ in our income tax sliding-scale we must proceed downwards. Taking sixteen-pence in the pound as the maximum rate we can impose on the big fish, the problem will be, What is the highest income to which you will allow any remission from the maximum rate?

I think those having above L150 a year possess more than the necessaries for healthful existence; looking therefore to the equity and productiveness of the tax, I suggested remission to those earning less than L3 a week.