"Do I contradict myself? Very well, then I contradict myself, I am large, I contain multitudes." -- Walt WhitmanBoth classical political economy and neoclassical economics are self-contradictory. That is not a bad thing per se. What is pernicious is the neurotic impulse to erase or ignore evidence of that contradiction and banish the internal voices of dissent from historical memory.
Thomas Chalmers and Sir Sydney J. Chapman were both "by no means inconsiderable, but hitherto neglected" figures in classical political economy and neoclassical economics, respectively. Chalmers was a contemporary of Malthus and Ricardo. Chapman, a student of Marshall and contemporary of Pigou and Keynes. Chalmers is famous for his very public exploits as an evangelical preacher and church leader. Chapman withdrew into the relative anonymity of a distinguished civil service career.
Their contributions to political economy have been regarded as "missing links". Chalmers's 1808 treatise, An Enquiry into the Extent and Stability of Natural Resources, according to Waterman (1991), "represents a revealing stage in the evolution of [the main tradition in political economy]." The method he employed of starting out with a highly abstract model and then progressively relaxing assumptions anticipated Ricardo by nine years.
Chapman's The Lancashire Cotton Industry was one of two "very promising steps towards the establishment of a Marshallian school of industrial economics... by two of his most distinguished pupils..." (Raffaelli 2004). There is an uncanny link between the two "not inconsiderable but neglected" thinkers. A passage in Chalmers's 1820 review article, "State and Prospects of Manufactures," contains a closely-argued exposition of how a relatively modest oversupply of labor in an industry can lead to a disproportionate fall in wages. His phrase, "there is a certain quantity of work to be done; and this quantity, generally speaking, does not admit of being much extended, merely on the temptation of labour being offered at a cheaper rate..." is an explicit (and appropriately qualified) statement of what much later came to be known as the "Theory of the Lump of Labour."
The assistant Poor Laws commissioner, Edward Carleton Tufnell, met with Chalmers in 1832 to discuss the latter's views on pauperism and in 1834 wrote Character, Object and Effects of Trades Unions, which contains a viciously distorted version of Chalmers's proposition, attributed, however as a "clumsy trick" of the cotton spinners' union. Tufnell's denunciation of that allegedly clumsy trick became the locus classicus of an anti-union polemic that evolved into the lump-of-labor fallacy claim.
In his history of the Lancashire cotton industry, Chapman cited Tufnell's polemic and commented that the shorter work day ideas of the Society for National Regeneration, although fundamentally sounded, were "frequently vitiated by appeals drawn" from the lump-of-labor doctrine. In his "Hours of Labour," Chapman debunked the prevailing prejudice among employers and economists that reducing the hours of work necessarily diminished output.
Taken together, Chalmers's 1820 passage and Chapman's 1909 article sketch the outlines of a comprehensive short-period and long-period analysis of the dynamic effects of labor supply on wages and of working time on output. What stands in the way of such analysis being undertaken in the first place or being paid attention to if carried out is a cult preference for observing or assuming harmony between accumulation and public welfare.
"The utilitarian calculus is inapplicable to differences of kind," J. A. Hobson explained. As a consequence only quantitative increase counts as improvement. The alleviation of misery is not in itself a worthwhile economic goal unless it results in or results from an increase in aggregate material wealth. But that's still only the more benign face of repressive harmony.
The corollary to the utilitarian calculus is the practice of blaming -- and punishing -- the victim. This is not a superficial or momentary reaction but a deep-seated article of faith among adherents of the creed of "self-reliance." Edward Carleton Tufnell was an exemplary exponent of that creed. Born to considerable wealth, Tufnell had no occasion to doubt his conviction that the misery of people born into poverty or reduced to pauperism by circumstances beyond their control was their own damn fault.
The pauper's degradation, Tufnell believed, arose from the pauper's own lethargy and the existence of easy public subsidy. His dilemma was of his own making. Nothing annoyed Tufnell more than the constant applications made to the commissioners, as the 'poor man's friend' to interfere because the poor had insufficient relief. To achieve a status of economic independence was, in the evangelicals' view, a moral obligation for the pauper. Thus their preoccupation with morality did not run counter to their belief in laissez-faire and Ricardian economic theories, rather it was supplemental to them. -- R. J. PhillipsIt occurred to me, while reading an account of Tufnell's career as an inspector of Poor Law Schools, that he may well have been the model for a Dickens character, such as Mr. Gradgrind or Mr. M'Choakumchild from Hard Times. In fact, one of the witnesses to the Royal Commission on the Employment of Children in Factories where Tufnell was an examiner, Robert Blincoe, may have been the model for Oliver Twist! Dickens is thought to have modeled his educational satire on the views of Tufnell's collaborator, James Kay-Shuttleworth, and wrote to a friend, "I am so dreadfully jaded this morning by the supernatural dreariness of [Kay-Shuttleworth], that I feel as if I had just come out of the Great Desert of Sahara where my camel died a fortnight ago."
When E. C. Tufnell died in 1886, he left an estate valued at 67,700 pounds, the equivalent in today's purchasing power of around $7,600,000.