It is a universal fact in the history of society that capital can only become a cheaper productive force than labor as it can yield increasing returns - that is to say, as it can supply the same products at less cost to the consumer. It is also a fundamental principle in economic production that the advantage resulting from the adoption of capitalistic methods does not arise so much from their producing the same quantity at a less cost, but in producing a much larger quantity at a less relative cost. For example, a market for a hundred pairs of shoes a month could be supplied cheaper by hand labor than by the most improved machinery of a modern shoe factory; but if a hundred thousand pairs of shoes a week can be sold, the factory can make them for less than one-half the cost of the hand laborer. Thus, capital can yield increasing returns - i.e., become a cheaper productive force than labor-only when it can produce on an extensive scale. And it is equally obvious that wealth can be profitably produced on a large scale only when the market for its consumption is commensurately increased. Even the large consumption of a small class cannot continuously furnish a market for the products of the large factory. Since the laboring classes constitute seven or eight-tenths of the community, it is upon increasing their consumption - which means raising the social life and wages of the laborer - that the market for capitalistic productions finally depends.
It will thus be seen that the economic interests of the employing class are not opposed to, but are bound up with and DEPENDENT UPON the social well-being of the laborer; that the success of the modern factory depends upon the comfort of the average laborer's home, and that the profitable employment of capital can only be promoted as the general rate of wages is advanced.
Wednesday, October 15, 2008
Economic and Social Importance of the Eight-Hour Movement
"Capital can yield increasing returns-i.e., become a cheaper productive force than labor-only when it can produce on an extensive scale. Since the laboring classes constitute seven or eight-tenths of the community, it is upon increasing their consumption-which means raising the social life and wages of the laborer-that the market for capitalistic productions finally depends."