How A Middle Class War Born
People often misjudge another person's position due to having different definitions for the words in use. Few people agree on what socialism really is and the same goes for capitalism. The following is what I define as capitalism, probably more accurate would be laissez-faire capitalism: "an economic system in which transactions between private parties are free from any form of government intervention such as regulation, privileges, imperialism, tariffs and subsidies. Proponents of laissez faire argue for a complete separation of government from the economic sector."--Wikipedia definition.
The claim made by Marx was capitalism was actually an impediment to the growth of an economy. I'm not sure what life was like in England in 1850 where Marx was, however let me introduce you to government data from time of the Robber Barons. I would say the data shows that laissez-faire capitalism actually created the middle class. I know of no other 60-year time frame in history where the standard of living for Average Joe increased this much. Let me know if you have other data. The data isn't abundant, however it's quite obvious that from 1850-1900 most jobs increased in pay by 100-171% while prices dropped. I would bet almost everyone reading this has never seen this data mentioned anywhere. You be the judge. (Pages listed for data are from Historical Statistics of the United States Colonial times to 1970, or History of Wages. Link below).
USA 1850-1910
Environment:
Population
1850--25 million
1860--31 million
1880--50 million
1900--77 million
1910--91 million
Labor Force:
1850--7.7 million
1860--10.5 million
1880--17.4 million
1900--29 million
1910--37 million
Percentage of labor in agriculture:
1850--63%
1860--58.9%
1880--49.4%
1900--37.5%
1910--31%
Gold--$20/ounce 1850-1910
Introduction of paper money with Lincoln Greenbacks, eventually retired, some sporadic printing of US Notes. All notes were redeemable in gold, otherwise why take the note?
1873--Silver dropped from bimetalism system establishing gold standard.
Taxes:
Federal Government operated almost entirely on Import Duties and Excise Taxes. Direct taxes allowed if apportioned by the census. If anybody is aware of an example of a direct tax from the 19th century please share.
Zero Income Tax
Zero Sales Tax
Federal Government:
2.5-3% of GDP except during war time. Today it's 20%.
Wholesale Prices:
Unit | 1850 | 1880 | 1910 | |||
Flour | 100 lbs | 5.550 | 8.890 | 4.690 | -15.00% | Page 225 of part 1 |
Sugar | 1 lb | 0.074 | 0.099 | ,05 | -32.00% | |
Cotton | 1 lb | 0.123 | 0.120 | 0.150 | 22.00% | |
Wool | 1 lb | 0.883 | 0.081 | 0.084 | -91.00% | |
Cotton Sheeting | 1 yard | 0.073 | 0.073 | 0.081 | 11.00% | |
Coal | 1 ton | 3.640 | 4.530 | 4.810 | 32.00% | |
Steel Rails | 100 lbs | 47.870 | 67.520 | 28.000 | -42.00% | |
Nails | 50 lbs | 3.710 | 3.680 | 1.888 | -49.00% | |
Copper | 1 lb | 0.215 | 0.215 | 0.129 | -40.00% | |
Turpentine | 1 gallon | 0.334 | 0.383 | 0.683 | 104.00% | |
Brick | 1000 | 4.850 | 6.840 | 5.720 | 18.00% |
Wages: Notice that all labor is figured as daily pay, 6 day work week. My dad was born in 1912 and said everybody worked 6 days a week, that was life back then. There was that much work to be done. The demand for labor more than doubled even while the work force at least tripled. Note also that even with wages doubling the standard workday dropped from 9 or 10 hours per day to 8.
Labor | 1860 | 1880 | 1900 | ||||
Page 192 history of wages | |||||||
Hod Carriers | Pennsylvania | 1.13/day 54 hours/week | 1.62/day 57 hours/week | 2.42/day 48 hours/week | Figued at 6 day weeks | ||
12.5 cents/hour | 17 cents/hour | 30 cents/hour | 171.00% | ||||
Carpenters and joiners | 1.75/day 60 hours/week | 2.28/day 60hours | 2.8/day 48 hours/week | ||||
17.5 cents/hour | 22.8 cents/hour | 35 cents/hour | 100.00% | ||||
Bricklayers | 2/day 54 hours/week | 2.22/day 57 hours/week | 4/day 48 hours/week | ||||
22 cents/hour | 0.230 cents/hour | 50 cents/hour | 127.00% | ||||
Marble Cutters | NY | 2.04/day 60 hours/week | 2.4/day 60 hours/week | 4.22/day 48 hours | |||
20.4 cents/hour | 24 cents/hour | 53 cents/hour | 165.00% | ||||
Manufacturing | 20 year increase | ||||||
Average | 1.620 | 2.260 | 37.00% | Page 182 | |||
Blacksmith | 1.640 | 2.310 | 41.00% | ||||
Carpenter | 1.650 | 2.150 | 30.00% | ||||
Engineers | 1.610 | 2.170 | 35.00% | ||||
Machinists | 1.610 | 2.450 | 52.00% | ||||
Painters | 1.610 | 2.210 | 37.00% | ||||
Laborer | 1.030 | 1.320 | 28.00% | Page 185 | |||
Public School Teachers: 1890--$256/year 1910--$492/year 92% |
|||||||
Most of the data in the linked articles are "indexed" for one reason and one reason only, inflation due to paper money. The data I've focused on is nominal, not indexed. In other words in actual dollar prices since the value of the dollar did not change from 1850-1910. An ounce of gold was $20 fixed by law, a $20 gold piece in 1850 was exactly the same as a $20 gold piece in 1910. Prices for goods and labor rose or fell mostly because of supply and demand. Prices continually rising for almost all things today is almost entirely a result of vastly increasing the money supply artificially with paper debt, not possible when the value of money did not fluctuate and was actual gold.
Finally, "Unemployment" data was not even collected before 1912. In spite of the population tripling, and labor force almost quadrupling, wages went up usually more than double while prices dropped with zero taxation other than property tax to run local government. Of course there was no Social Security, no welfare, no large standing army. Average Joe never gave a dime to the federal government unless he paid an excise tax like on tobacco or alcohol. Privacy was actually a real thing. Never a sales tax or fill out any tax form whatsoever. Especially with railroads connecting the oceans the economy absolutely boomed. From 1876-1894 there were 3 years with tiny trade deficits, then zero trade deficits until 1970. To call today's economy the best ever is an absolute joke, if data and history matter to you. I've found that to most people it does not matter, what matters is their belief which must be defended. Which is why you should never believe me.
History of Wages in the United States from Colonial Times to 1928--US Dept. of Labor
Historical Statistics of the United States, Colonial Times to 1970, Part 1
Historical Statistics of the United States, 1789-1957
Chart of US Population 1790-2000
US Federal Spending Since 1792 as Percentage of GDP
https://www.usgovernmentspending.com/federal_spending_chart
Increases in Spending since 1900
https://www.usgovernmentspending.com/past_spending
Total Government as Percentage of GDP--36% estimate
https://www.usgovernmentspending.com/percent_gdp
Debt as Percentage of GDP--Virtually zero in 1860, only 10% of GDP in 1900 after paying off Civil War debt.
https://www.usgovernmentspending.com/debt_deficit_history