Grand Pursuit: A Story of Economic Genius. Sylvia Nasar

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СКАЧАТЬ took a while. He found “the dry land of facts” intellectually unappetizing and socially unappealing. When he was asked to take over some lectures on political economy, Marshall agreed reluctantly. “I taught economics . . . but repelled with indignation the suggestion that I was an economist . . . ‘I am a philosopher straying in a foreign land.’ ”³⁸

      When Marshall began to study economics seriously in 1867, his mentor Sidgwick was convinced that the “halcyon days of Political Economy had passed away.”³⁹ After the success of the 1846 Corn Law repeal, which was followed by a period of low food prices, political economy had a brief turn as “a true science on par with astronomy.”⁴⁰ But the economic crisis and political upheavals of the 1860s revived the old animus against the discipline among intellectuals. Going a step beyond Carlyle’s epithet “the dismal science,” John Ruskin, the art historian, dismissed political economics as “that bastard science” and, like Dickens, called for a new economics; “a real science of political economy.”⁴¹ The fundamental problem, observed Himmelfarb, was that “the science of riches” clashed with the evangelicalism of the late Victorian era.⁴² Victorians were repelled by the notion that greed was good or that the invisible hand of competition guaranteed the best of all possible outcomes for society as a whole.

      With the advent of the franchise for working men, both political parties were courting the labor vote. But “political economy” was invoked to oppose every reform—whether higher pay for farm laborers or relief for the poor—on the grounds that it would slow down the growth of the nation’s wealth. While the founders of political economy had been radical reformers in their day, championing women’s rights, the abolition of slavery, and middle-class interests versus those of the aristocracy, their theories pitted their disciples against labor. As Virginia Woolf’s father, Leslie Stephen, remarked: “The doctrine . . . was used to crush all manner of socialist schemes. . . . Political economists were supposed to accept a fatalistic theory, announcing the utter impossibility of all schemes for social regeneration.”⁴³

      For example, when Henry Fawcett, the reform-minded professor of political economy at Cambridge, addressed striking workers, he told them that they were cutting their own throats. Such advice outraged Ruskin, who said, after a builders’ strike in 1869, “The political economists are helpless—practically mute; no demonstrable solution of the difficulty can be given by them, such as may convince or calm the opposing parties.”⁴⁴ Mill was an even more dramatic example than Fawcett. Now a Radical member of parliament, Mill called himself a Socialist, and had championed the Second Reform Act and the right of workers to unionize and strike. Yet Mill’s view of the future of the working classes was scarcely less dour than that of Ricardo or Marx. J. E. Cairnes, a professor at University College London who published a famous indictment of slavery as an economic system, echoed Mill’s position a few years later:

      The margin for the possible improvement of their lot is confined within narrow barriers which cannot be passed and the problem of their elevation is hopeless. As a body, they will not rise at all. A few, more energetic or more fortunate than the rest, will from time to time escape . . . but the great majority will remain substantially where they are. The remuneration of labor, as such, skilled or unskilled, can never rise much above its present level.⁴⁵

      At the heart of Mill’s pessimism lay the so-called wages fund theory. According to this theory, ultimately disowned by Mill but never replaced by him, only a finite amount of resources was available to pay wages. Once the fund was exhausted, there was no way to increase the aggregate amount of pay. In effect, the demand for labor was fixed, so that only the supply of labor had any effect on wages. Thus, one group of workers could obtain higher wages only at the expense of lower wages for others. If unions succeeded in winning a wage rate in excess of the rate of the wages fund, unemployment would result. If the government intervened by taxing the affluent to subsidize wages, the working population would increase, causing more unemployment and even higher taxation. Moreover, the use of taxes to subsidize pay would reduce efficiency by removing competition and the fear of unemployment. Eventually, Mill warned, “taxation for the support of the poor would engross the whole income of the country.”⁴⁶ Unless the working classes acquired prudential habits of thrift and birth control, the author of a popular American textbook claimed, “they will people down to their old scale of living.”⁴⁷ In her political economy primer, Millicent Fawcett cited the Corn Law repeal as proof that wages were tethered to a physiological minimum. Referring to the worker, she wrote:

      Cheap food enabled him, not to live in greater comfort, but to support an increased number of children. These facts lead to the conclusion that no material improvement in the condition of the working classes can be permanent, unless it is accompanied by circumstances that will prevent a counter-balancing increase of population.⁴⁸

      By the time the Second Reform Act passed however, the theory that wages could not rise in the long run no longer looked tenable, and not only because of the dramatic increase in average pay. The conquest of nature by the railway, steamship, and power loom suggested that society was not yet close to natural limits to growth. The fact that emigrants were prospering abroad and that a middle class of skilled artisans and white-collar workers was shooting up at home contradicted the notion that a mass escape from poverty was ruled out by the biological laws. Poverty that had once appeared to be a natural and near-universal feature of the social landscape began to look more and more like a blemish.

      Was there an ingenious mechanism that could lift wages until the average wage sufficed for a middle-class life? Mill acknowledged that the wages fund theory was flawed, but neither he nor his critics could propose a satisfactory alternative. An extraordinary number of Victorian intellectuals—from Charles Dickens, Henry Mayhew, and Karl Marx to John Ruskin and Henry Sidgwick—attempted to fashion one. Since none had so far succeeded, no one could say whether hopes for social betterment really could be reconciled with economic reality, or whether the palpable gains of the 1850s and 1860s were doomed to be reversed. Tories such as Ruskin and Carlyle, an anti-Abolitionist, predicted disaster if the old feudal bonds were not restored. Socialists argued that without sweeping societal changes, the condition of workers was “un-improvable and their wrongs irremediable.”⁴⁹ The standard-of-living debate, as it became known, boiled down to one question: How much improvement was possible under existing social arrangements?

      As he stood before “70 to 80 ladies” in a borrowed Cambridge college lecture hall on a spring evening in 1873, Alfred Marshall’s handsome face was lit with an inner flame, and he spoke with great force and fluency without notes. He addressed the women in plain, direct, homely terms as if he were speaking to his sister, urging them to stop “tatting their tatting and twirling their thumbs” and counseled them to resist the demands of their families. Instead he wanted them to get jobs as social workers and teachers like “Miss Octavia Hill.” Most of all, he insisted that they learn “what difficulties there are to be overcome, and . . . how to overcome them.”⁵⁰

      Like his mentor Henry Sidgwick and other university radicals of the 1860s and 1870s, Marshall came to see education as a weapon in the struggle against social injustice, and like other admirers of Mill’s The Subjection of Women, published in 1869, he considered the educated woman society’s principal change agent. For Marshall, the existential problem for women and for the working classes was essentially the same: both lacked the opportunity to lead independent and fulfilling lives. Workers were condemned by low wages to lives of drudgery that prevented all but the most exceptional from fully developing their moral and creative faculties. Middle-class women were condemned by custom to ignorance and drudgery of a different sort. Inspired by the novels of contemporaries such as George Eliot and Charlotte Brontë, Marshall was particularly sensitive to the plight of women who were prevented from developing their intellects and regretted society’s loss of their talents. He was convinced that the task of liberating the working classes required the energies of middle-class women as well as a more scientific economics. On the topic of “the intimate connection between the free play of the full and strong pulse of women’s thought and the amelioration СКАЧАТЬ