[Peace-discuss] The political economy of Peterloo

[David Green]

https://thenextrecession.wordpress.com/2019/08/16/the-political-economy-of-peterloo/

The political economy of Peterloo

Today is the 200th anniversary of what has come to be called the Peterloo
massacre. <https://en.wikipedia.org/wiki/Peterloo_Massacre>  On 16 August
1819, 60,000 working people gathered at St Peter’s Field in Manchester
England to demonstrate for the right to vote, against the terrible
conditions and pay of factory workers and for the right to organise at the
workplace, among a host of other injustices.

<https://thenextrecession.files.wordpress.com/2019/08/peterloo-1.jpg>

Peterloo has become a marker in the labour history of Britain. The peaceful
demonstration was brutally attacked and dispersed by a private militia of
thugs on horseback funded and directed by the local landlords and
authorities with the tacit backing of the then Tory government under Lord
Liverpool. An estimated 18 people, including a woman and a child, died from
sabre cuts and trampling. Over 700 received serious injuries.

I am not going to discuss the event or the politics behind it as there are
many thorough and better accounts to be had elsewhere.  Indeed, there is a
film by leading British filmmaker, Mike Leigh
<https://www.imdb.com/title/tt4614612/> on the day.

Instead, I want to comment on the economics of Peterloo: the state of the
British economy and capitalism at the time  – to provide some context to
the event and also perhaps draw out some wide generalisations.

Peterloo took place a few years after the end of so-called Napoleonic wars
in which the aristocratic monarchies of Britain, Austria, Russia and
Germany finally defeated the French republic.  The end of the war heralded
a period of deep depression in European economies, as soldiers returned
home without work and bad harvests and weather led to a sharp downturn in
agricultural production – still the dominant form of economic activity in
early 19th century Europe.

This period of depression started before the end of war in 1812 and
continued for ten years to 1822. It is reckoned that England suffered more
economically, socially and politically, than during the French wars when at
least there were good harvests and armaments production provided work.
During the wars, Britain’s export and re-export trade increased. British
ships carried the world’s trade and also captured French colonies which
further increased Britain’s trade potential. After 1815 this virtual
monopoly ended and trade declined

The depression brought discontent and distress and a response from the
growing layers of industrial workers in the ‘dark satanic mills’ of the new
big cities of Manchester, Liverpool and Birmingham that had no
parliamentary representation or civic rights.  The 18th century
constitution remained, with the landlord class in control and forming the
government.

In 1815 parliament passed the Corn Laws, enforcing higher prices for grain
to protect landlord profits from cheaper foreign imports, squeezing the
wages of workers and the profits of the industrial capitalists.  Classical
bourgeois economist, David Ricardo wrote his Principles of Political
Economy and Taxation in 1817 that presented a theoretical argument against
agricultural rents and the corn laws.  Indeed, Ricardo led the demand in
parliament for an inquiry into the Peterloo massacre.

Wages were held down by the so-called Speenhamland system, which subsidised
wages from the public purse somewhat like the Universal Basic Income
proposed now.  At the same time, the demobilisation of 300,000 soldiers,
the influx of 100,000 Irish labourers and the use of children and women in
the factories meant that the ‘reserve army of labour’ (to use Marx’s
phrase) was huge.  Indeed, the population in the industrial areas was
rocketing (up 50% in the first 30 years of the 19th century).

At the same time, any attempt by rural workers to feed themselves off the
land was blocked and curtailed by the landowners.  The 1816 Game Laws
allowed landowners to hunt for game; but not their workers.  The penalty
for poaching was seven years transportation to Australia.  Common land had
been wiped out by the enclosure measures decades before.
*Decade* *Enclosures*
1780-90 287
1790-1800 506
1800-1810 906

The war had driven up the public debt to £834 million. Interest on this was
a heavy burden to taxpayers. But the answer of the government was to end
income tax, thus shifting the burden of servicing the debt onto the poorest
through various sales and customs taxes.  The interest paid on the debt
went to the rich war bond holders now no longer paying income tax.  The
government tried to inflate away the debt burden by staying off the gold
standard and letting the pound devalue, driving up inflation and hitting
the poor again.

Radical poet Lord Byron protested in the House of Lords about the situation
in 1812 *“I have been in some of the most oppressed provinces of Turkey
<https://en.wikipedia.org/wiki/Ottoman_Empire>; but never, under the most
despotic of infidel governments, did I behold such squalid wretchedness as
I have seen since my return, in the very heart of a Christian country”.*

All this was compounded by the weather.  The year 1816 is now known as the
‘Year Without a Summer’ because of severe climate abnormalities that caused
average global temperatures to decrease by 0.4–0.7 °C. This resulted in
major food shortages across the Northern Hemisphere
<https://en.wikipedia.org/wiki/Northern_Hemisphere>. Evidence suggests that
the anomaly was predominantly a volcanic winter
<https://en.wikipedia.org/wiki/Volcanic_winter> event caused by the
massive 1815
eruption of Mount Tambora
<https://en.wikipedia.org/wiki/1815_eruption_of_Mount_Tambora> in the Dutch
East Indies <https://en.wikipedia.org/wiki/Dutch_East_Indies> (now Indonesia
<https://en.wikipedia.org/wiki/Indonesia>). This eruption was the largest
eruption in at least 1,300 years.

The Year Without a Summer was an agricultural disaster. Low temperatures
and heavy rains resulted in failed harvests in Britain
<https://en.wikipedia.org/wiki/Great_Britain> and Ireland. Families in Wales
<https://en.wikipedia.org/wiki/Wales> travelled long distances begging for
food. Famine was prevalent in north and southwest Ireland, following the
failure of wheat, oat <https://en.wikipedia.org/wiki/Oat>, and potato
harvests. In Germany, the crisis was severe; food prices rose sharply. With
the cause of the problems unknown, people demonstrated in front of grain
markets and bakeries, and later riots, arson, and looting
<https://en.wikipedia.org/wiki/Looting> took place in many European cities.
It was the worst famine <https://en.wikipedia.org/wiki/Famine> of
19th-century Europe.

Indeed, The Year Without a Summer is a misnomer; it was Years Without a
Summer given the weather of 1816, 1817, and 1818.  Lord Byron, now in
permanent exile, was moved to write an apocalyptic poem, The death of the
sun, while staying by the banks of Lake Geneva in July 1816 as Europe and
North America were gripped by one of the coldest summers on record.

*“I had a dream, which was not all a dream. The bright sun was
extinguish’d, and the stars Did wander darkling in the eternal space,
Rayless, and pathless, and the icy earth, Swung blind and blackening in the
moonless air; Morn came and went—and came, and brought no day, And men
forgot their passions in the dread Of this their desolation.”*

It is also no accident that Mary Shelley, the partner of Percy Shelley,
went on to write Frankenstein in 1818.
<https://en.wikipedia.org/wiki/Frankenstein> Shelley’s miserable Creature
is usually portrayed as the terrible result of uncontrolled technology.
But in the context of the climate shock, it is also a figure representing
the desperate refugees crowding Switzerland’s market towns in that year.
Eyewitness accounts frequently refer to how hunger and persecution “turned
men into beasts”, how fear of famine and disease-carrying refugees drove
middle-class citizens to demonize these suffering masses as subhuman
parasites and turn them away in horror and disgust.

Peterloo happened because the British government in this depression was the
most reactionary.  There was a fear of the democratic ideas of the French
Revolution spreading.  There was a lasting fear of popular movements
<http://www.historyhome.co.uk/peel/movets.htm>, which reflected the fear of
revolution. There was a determination to protect and defend the landed
interest – the basis of the government’s political power. There was a
general dislike of an organised police-force
<http://www.historyhome.co.uk/peel/laworder/police.htm>, so a consequent
heavy reliance on the military and private militias meant that in any
confrontation, made violence the preferred option. The government kept
the Combination
Acts <http://www.historyhome.co.uk/c-eight/pitt/repress.htm#comb> on
Statute Books until 1824, which suppressed all reform movements. This was a
government of the landed few for the landed few.

The 18th century economist <https://en.wikipedia.org/wiki/Economist> Adam
Smith <https://en.wikipedia.org/wiki/Adam_Smith> noted the imbalance in the
rights of workers in regards to owners (or “masters”). In The Wealth of
Nations <https://en.wikipedia.org/wiki/The_Wealth_of_Nations>, Book I,
chapter 8 <https://en.wikisource.org/wiki/Chapter_8:_Of_the_Wages_of_Labour>,
Smith wrote: “*We rarely hear, it has been said, of the combination of
masters, though frequently of those of workmen. But whoever imagines, upon
this account, that masters rarely combine, is as ignorant of the world as
of the subject. Masters are always and everywhere in a sort of tacit, but
constant and uniform combination, not to raise the wages of labor above
their actual rate[.]  **When workers combine, masters … never cease to call
aloud for the assistance of the civil magistrate, and the rigorous
execution of those laws which have been enacted with so much severity
against the combination of servants, labourers and journeymen.”*

This was also the period of the so-called Luddites, a radical group of
weavers who reacted to the introduction of machinery and their loss of jobs
with attacks on the machines themselves.

In this light, the Peterloo massacre was the inevitable waiting to happen.
After the event, the great radical romantic poet, Percy Shelley graphically
attacked the government and its ruling class in his famous poem, Masque of
Anarchy, <http://www.historyhome.co.uk/c-eight/distress/masque.htm> the
final verse of which is echoed in the current campaign slogan of the
British leftist Labour party
<https://labour.org.uk/wp-content/uploads/2017/10/labour-manifesto-2017.pdf>
:

‘Rise like Lions after slumber
In unvanquishable number –
Shake your chains to earth like dew
Which in sleep had fallen on you –
Ye are many – they are few.’

At a more general level, Peterloo took place in the same year as the very
first capitalist-style crisis and financial crash. The Panic of 1819
<https://en.wikipedia.org/wiki/Panic_of_1819>started in the US and was
triggered by the post-Napoleonic depression in Europe which led to the
collapse of US export markets and the bankruptcy of several banks that had
made export loans.  The ensuing recession lasted until 1821. The boom and
bust cycle that has characterised capitalist accumulation to this day had
begun.

This was the first capitalist slump – and also the first recognisable
period of depression in modern industrial capitalism.  In my book, The Long
Depression <https://www.haymarketbooks.org/books/693-the-long-depression>,
I suggest that capitalist accumulation takes place in cycles of
profitability.  There are periods of rising profitability and then periods
of falling profitability (within the longer-term context of a secular fall
as capitalist economies mature).

There are four seasons each of approximately 10-14 years in the 19th
century (they are longer in the 20th century).The first season (Spring)
sees a rise in profitability as new technology and an expanding workforce
is applied.  In the second season (Summer), profitability falls and because
labour has got stronger during the spring season, the class battle
intensifies.  Then comes Autumn, a new period of rising profitability built
on the defeat of previous labour struggles and the weakening of labour
through slumps.  Finally, profitability falls again in the Winter season
and there is a depression that can only be broken either by war or by
successive slumps that eventually restore profitability for a new Spring.

1819 was a year right in the middle of such a Winter.  The weakening of
labour in the previous Autumn of the war economy from 1800-1812 had seen
profitability rise for both landowners and rising industrial capitalists.
But the post-war depression was one of falling profitability (as noted by
Ricardo) in which the dominant landowning class tried to preserve its
profits and hegemony at the expense of industry and labour through
repression and taxation.  Peterloo was the marker for this.

After 1822, England entered a new Spring based on industrial expansion and
the revival of export markets in Europe.  The industrial bourgeois
mobilised its workers to fight for the vote in the cities and parliamentary
representation (for property owners).  The Reform Act was passed in 1832.

SPRING 1776-86: profitability up; industrialisation begins, labour
strengthens, first trade unions

SUMMER 1786-1800: profitability down; Marx’s law operates, labour fights

AUTUMN 1800-12: profitability up; war economy; labour weakened and overseas

WINTER 1812-22: profitability down; post-war depression, labour repressed
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