The contrast between the industrial England of 1760and the industrial England of to-day is not only one of external conditions.Side by side with the revolution which the intervening century has effected in the methods and organisation of production,there has taken place a change no less radical in men's economic principles,and in the attitude of the State to individual enterprise.England in 1760was still to a great extent under the medieval system of minute and manifold industrial regulations.That system was indeed decaying,but it had not yet been superseded by the modern principle of industrial freedom.To understand the origin of the medieval system we must go back to a time when the State was still conceived of as a religious institution with ends that embraced the whole of human life.In an age when it was deemed the duty of the State to watch over the individual citizen in all his relations,and provide not only for his protection from force and fraud,but for his eternal welfare,it was but natural that it should attempt to insure a legal rate of interest,fair wages,honest wares.Things of vital importance to man's life were not to be left to chance or self-interest to settle.For no philosophy had as yet identified God and Nature:no optimistic theory of the world had reconciled public and private interest.And at the same time,the smallness of the world and the community,and the comparative simplicity of the social system made the attempt to regulate the industrial relations of men less absurd than it would appear to us in the present day.
This theory of the State,and the policy of regulation and restriction which sprang from it,still largely affected English industry at the time when Adam Smith wrote.There was,indeed,great freedom of internal trade;there were no provincial customs-barriers as in contemporary France and Prussia.Adam Smith singled out this fact as one of the main causes of English prosperity,and to Colbert and Stein,and other admirers of the English system,such freedom appeared as an ideal to be constantly striven after.But though internal trade was free for the passage of commodities,yet there still existed a network of restrictions on the mobility of labour and capital.By the law of apprenticeship no person could follow any trade till he had served his seven years.The operation of the law was limited,it is true,to trades already established in the fifth year of Elizabeth,and obtained only in market-towns and cities.But wherever there was a municipal corporation,the restrictions which they imposed made it generally impossible for a man to work unless he was a freeman of the town,and this he could as a rule become only by serving his apprenticeship.Moreover,the corporations supervised the prices and qualities of wares.In the halls,where the smaller manufacturers sold their goods,all articles exposed for sale were inspected.The medieval idea still obtained that the State should guarantee the genuineness of wares:it was not left to the consumer to discover their quality.
And in the Middle Ages,no doubt,when men used the same things from year to year,a proper supervision did secure good work.But with the expansion of trade it ceased to be effective.Sir Josiah Child already recognised that changes of fashion must prove fatal to it,and that a nation which intended to have the trade of the world must make articles of every quality.Yet the belief in the necessity of regulation was slow in dying out,and fresh Acts to secure it were passed as late as George II's reign.
It is not clear how far the restrictions on the mobility of capital and Labour were operative.No doubt they succeeded to a large extent;but when Adam Smith wrote his bitter criticism of the corporations,he was probably thinking of the particular instance of Glasgow,where Watt was not allowed to set up trade.
There were,however,even at that time,many free towns,Like Birmingham and Manchester,which flourished greatly from the fact of their freedom.And even in the chartered towns,if Eden is to be trusted,the restrictions were far less stringent than we should gather from Adam Smith.'I am persuaded,'he says,'that a shoemaker,who had not served an apprenticeship,might exercise his industry at Bristol or Liverpool,with as little hazard of being molested by the corporation of either place,as of being disturbed by the borough-reve of Manchester or the head-constable at Birmingham.'Then after quoting and criticising Adam Smith,he adds:'I confess,I very much doubt whether there is a single corporation in England,the exercise of whose rights does at present operate in this manner....In this instance,as in many others,the insensible progress of society has reduced chartered rights to a state of inactivity.'We may probably conclude that nonfreemen were often unmolested,but that,when trade was bad,they were liable to be expelled.
Another relic of Medievalism was the regulation of wages by Justices of the Peace,a practice enjoined by the Act of Elizabeth already referred to.Adam Smith speaks of it as part of a general system of oppression of the poor by the rich.Whatever may have been the case in some instances this was not generally true.The country gentry were,on the whole,anxious to do justice to the working classes.Combinations of labourers were forbidden by law,because it was thought to be the wrong way of obtaining the object in view,not from any desire to keep down wages.The Justices often ordained a rise in wages,and the workmen themselves were strongly in favour of this method of fixing them.The employers on their part also often approved of it.In fact we have an exactly similar system at the present day in boards of arbitration.The Justice was an arbitrator,appointed by law;and it is a mistaken assumption that such authoritative regulation may not have been good in its day.
