Paternalism is a common attitude among well-meaning social reformers. Stemming from the root pater, or father, paternalism implies a patriarchal, benevolent but superior sensibility. Paternalistic social reformers feel a social responsibility and believe that they should “uplift” those beneath them, but also see those they help as inferior, or childlike, in some way. Paternalistic industrialists assume that they have a responsibility to those in their employ. Robert Owen built the mill town of New Lanark, where he created relatively high quality schools and housing for his workers. He was never a democrat because workers’ democracy would mean he would lose his personal control.
Robert Owen, left his home in Wales when he was only ten, to make his own way in business. He walked to London, where he entered the retail drapery trade. When he was 14 he went to Manchester. With a partner and £100 capital he began making machines (mules) for spinning cotton. Later he became manager (and later partner in) a factory. By the time he was twenty nine he was manager and part owner of New Lanark Cotton Mills near Glasgow. The mills had been established a few years earlier by David Dale, Owen’s future father-in-law.
Robert Owen has been called the “father of English Socialism” and although he did not start English socialism, it caught hold of him and carried him along. It was the followers of Robert Owen who introduced the word “socialism” for the first time in the Owenite Co-operative Magazine of November 1827. For Owen and his followers, ‘social’ signified ‘co-operation’ and a socialist supported co-operation. Owen found that treating your workers better makes better workers which makes better profits. As early as 1810, he raised the demand for a ten-hour working day, which was instituted on his enterprise at New Lanark. By 1817 he was calling for an eight-hour day under the slogan ‘Eight hours labour, Eight hours recreation, Eight hours rest.’
“…no experiment was ever so successful as the one I conducted at New Lanark, although it was commenced and continued in opposition to all the oldest and strongest prejudices of mankind. For twenty-nine years we did without the necessity for magistrates or lawyers; without a single legal punishment; without any known poors’ rate; without intemperance or religious animosities. We reduced the hours of labour, well educated all the children from infancy, greatly improved the condition of the adults, diminishing their daily labour, paid interest on capital, and cleared upwards of £300,000 of profit.” (quoted in GJ Holyoake’s History of Cooperation).
New Lanark gained international fame when Owen’s experiments in enhancing his workers’ environment resulted in increased productivity and profit. Before long, New Lanark became a tourist attraction where visitors came to gawk at Owen’s social experiment. Between 1805 and 1815, 15,000 visitors came to New Lanark. Owen reckoned that between 1814 and 1824 there were about 2,000 visitors every year. (To-day, New Lanark is a UNESCO World Heritage site)
In 1800, Robert Owen took over the management of David Dale’s cotton mills at New Lanark and put into practice the ideas that he had developed earlier in his life and his workers at New Lanark were made to adopt new living, working, sanitary, educational and other standards. When he first arrived, the population, he claimed:
“… possessed almost all the vices and very few of the virtues of a social community. Theft and the receipt of stolen goods were their trade, idleness and drunkenness their habit, falsehood and deception their garb…they united only in a zealous systematic opposition to their employers…”
New Lanark had a population of 2,000 people, 500 of whom were young children from the poorhouses and charities of Edinburgh and Glasgow. The children had been well treated by Dale but Owen found the condition of the people unsatisfactory. Owen refused to take any more pauper children and he began to improve the houses and machinery. Crime and vice bred by the demoralising conditions were common; there was little education and less sanitation; housing conditions were intolerable. Owen set out to test his ideas on education and the environment by attempting to set up a model factory and model village. Under him, conditions in the factory were clean and children and women worked relatively short hours: a 12 hour day including 1½ hours for meals. He employed no children under 10 years old. He provided decent houses, sanitation, shops and so on for the workers. He gave rewards for cleanliness and good behaviour and mainly by his own personal influence, encouraged the people in habits of order, cleanliness, and thrift. The Gentleman’s Magazine commented that:
“the children live with their parents in neat comfortable habitation, receiving wages for their labour…The regulations here to preserve health of body and mind, present a striking contrast to those of most large manufactories in this kingdom.”
He won the confidence of his work-force by opening a shop in which goods of sound quality could be bought at little more than cost price and at which the sale of alcohol was placed under strict supervision. The profit made by the shop was put straight into the school where the children of the factory workers were given a “free” education. Owen’s educational venture at New Lanark helped to pioneer infant schools and was an early example of what we now recognize as community schooling. Robert Owen aimed at giving children a good basic education, fitting the village youth for the world of work in the mills, but at the same time posing no threat to the existing order of society. He succeeded in creating a system which was able to produce obedient, conforming and apparently happy children equipped with basic literacy and numeracy. He also became more popular duing the American embargo in 1806 when he closed the mills for four months but paid the workmen their full wages. The mills continued to thrive commercially. Owen received no criticism from below and he simply bought out critical partners. Frustrated by the restrictions imposed on him by his partners, who wished to conduct the business along more ordinary lines, he organised a new firm in 1813. Owen decided to find men who would sympathise with his aims and circulated a pamphlet called A New View of Society describing his principles. Owen proposed that five per cent should be paid on capital and the whole surplus devoted to general education and improvement of the labourer’s condition. Owen was a paternalistic factory aristocrat. He kept a close watch on employees. He was especially proud of the arrangement for marking each man’s conduct daily by a ‘silent monitor,’ a label coloured to indicate either goodness and badness and placed opposite each man’s post.
The rest of Owen’s life was an attempt to recreate the New Lanark experience on a large scale and he became more radical. Owen began to flood Parliament and the newspapers with tracts promoting a plan for social reorganization on a grand scale. In place of the existing system of private property and profit, he proposed the creation of Villages of Cooperation. Each village would be a self-sufficient unit of between 500 and 1,000 people that combined agricultural and industrial production. Every family would have a private apartment In his earliest days, Owen appeared to be little more than a benevolent factory owner who made paternalistic improvements in the lives of his employees. Society was to be transformed by means of experimental communities. Education was the key to Owen’s scheme and its purpose was to mould the individual into an ideal social character. Owen argued that human nature could be changed: since we are all products of our environment, one need only change the environment to change man. Yet this 18th century materialist determinist view of the mind as a blank sheet on which the environment can imprint anything is wrong as the nurture Versus nature debate is an over-simplification but it, nevertheless, became a cornerstone of the socialist theories and programs of the 19th century. Society punished men for being what society had made them become. Owen wanted to produce self-help and initiative in the working man so where other men advocated the reform of the country’s political institutions, Owen became preoccupied with rendering the State itself redundant. Owen thought the multiplication of “”villages of co-operation” would lead to what Engels later called the “withering away of the state”.
From 1824 Owen poured his own money into setting up a community, New Harmony, in Indiana, which failed within a few years. New Harmony was the first and most famous of some sixteen Owenite communities that appeared in the US between 1825 and 1829. None, however, lasted more than a few years as communities. One of the most interesting was Nashoba, founded in 1825 by Scottish-born social reformer Frances Wright on the Wolf River in Tennessee. Wright intended to prove that education and a change of environment could have the same transformative effect on slaves as they had on the proletariats of New Lanark. Wright planned to purchase slaves, educate them, and free them. The plan failed because the community could not produce enough income to pay back the debts incurred in buying the slaves.
When Owen returned to Britain in 1829 after the failure of his American experiment he began to associate himself with the various self-help schemes. By 1830, more than 300 cooperative societies were in operation. Owen had set up his own cooperative (Association for the Promotion of Cooperative Knowledge), union (Grand National Consolidated Trades Union) and labour exchange (National Equitable Labour Exchange) organisations. The latter functioned as an extension of the cooperative store, surplus coop produce forming the basis of its activities. Essentially goods brought in were valued by a committee and a note issued indicating the amount of labour required to produce the item. This could then be exchanged for other goods in the bazaar of the same labour time value, the same time to produce. The the economic problem was seen as one of “unequal exchange” – employers paid wages less than the value of the product and so were cheating workers. At one time products tended to exchange according to the time the independent producers had taken to make them. In this way they did get more or less the full equivalent of their labour. But individual artisan’s tools have now developed into the powerful factory machines of today owned by capitalist companies while the producers now sell their ability to work to one or other of these companies in return for a wage or a salary. They no longer own and control the products of their labour. These belong to the company, which sells them for more than they cost to produce, pocketing the difference as their profits. When producers first became separated from the means and instruments of production, as was increasingly the case throughout the 19th century, it was not difficult for them to realise what was happening. They could see that what they produced sold for what it did when they had made them themselves as independent producers, but instead of them getting the full equivalent of their labour they only got a part of it as wages, the rest going to the capitalist who employed them. The source of the capitalists’ profits was their unpaid labour. So the demand for the full “fruits of our labour” went up among the more radical of the newly proletarianised producers. All sorts of schemes were devised by critics of capitalism such as Robert Owen in Britain and Proudhon in France to try to recreate the same result as in the old situation. But it was too late. They all failed as they had become irrelevant due to production no longer being individual but a collective effort. In this new circumstance, if the demand for “the full fruits of labour” was to be met it could only be done collectively. The whole product of society would have to be commonly owned and used for the benefit of all. This of course is socialism and it is the only way that, today, people can get to keep the fruits of their (collective) labour.
Robert Owen attempted to rectify this “unequal exchange” so that workers could obtain the full “fruits of our labour” by establishing a number of producer and consumer co-operatives around the country, linked by labour exchanges. The guiding principle of these labour exchanges was that goods were exchanged according to their value as measured by labour time, with non-circulating labour notes used to facilitate the exchange of goods. In this way, it was believed, there would be equal exchange and no exploitation. However, these co-operatives were short-lived and had difficulty in providing even basic provisions for exchange against labour notes. The problem of valuing goods in terms of labour time meant that errors were made and, inevitably, there were goods undervalued in relation to their market equivalents that were quickly purchased, while there were others that were overvalued and just as rapidly accumulated in the exchanges. Only where the labour exchanges replicated the market valuation were there no such problems. In effect, therefore, market price rapidly exerted its hegemony over labour values.
These bazaars were failures, but the idea of labour-time vouchers, or ‘labour money’, appeared in substantially similar forms in France with Proudhon, in Germany with Rodbertus and in England with Hodgskin and Gray. The idea was also to appear in Marx’s Critique of the Gotha Programme (1875). This proposition has been seized upon by left-wingers as proof that Marx presumed the use of money in the early phase of communism. But in this work, as elsewhere, Marx is clear that communism (in its early and mature phases) will be based on common ownership and have no use for money:
“Within the co-operative society based on the common ownership of the means of production, the producers do not exchange their products.”
Marx was quite adamant that his and Owen’s suggested labour-time vouchers would not function as money:
“Owen’s ‘labour-money’ for instance, is no more “money” than a ticket for the theatre. Owen presupposes directly associated labour, a form of production that is entirely inconsistent with the production of commodities. The certificate of labour is merely evidence of the part taken by the individual in the common labour, and of his right to a certain portion of the common produce destined for consumption” (Capital, Vol. 1).
“These producers may… receive paper vouchers entitling them to withdraw from the social supplies of consumer goods a quantity corresponding to their labour-time. These vouchers are not money. They do not circulate’”(Capital, Vol. 2).
Marx only suggested labour-time vouchers as a possibility; given the low level of development of the productive forces, he believed that this was one way of regulating individual consumption. The objective was, for Marx and Owen: from each according to ability, to each according to need. And this is now realisable, as soon as a majority wants it. For Owen in the early nineteenth century the problem of the underdevelopment of the forces and relations of production was even more acute; and it is probably for this reason that he did not recognise the existence of the class struggle. This is why Marx and Engels called his ideas (along with those of Fourier and Saint-Simon) ‘Utopian Socialism’.
It was a fairly straightforward deduction that if labour is the source of all value, it is also the source of all power. The rich and apparently powerful “unproductive classes” are just a small minority sitting on the broad shoulders of the toiling masses. If the workers withdraw their labour, the unproductive classes topple over. A national strike, or “sacred month”, would herald in a new co-operative order.
With the Grand National Consolidated Trade Union that he helped to found, Owen brought all the widespread but disparate industrial activity under One Big Union with the object of ending the “capitalist system”. He wanted to use unionism to change the economic system while his members wanted to use the unions to wring higher wages from their employers. From the union leaders’ viewpoint, the Grand National’s primary goal was an eight-hour workday. From Owen’s perspective, the goal was a total transformation of society based on Owen’s Villages of Cooperation. The inclusion of all workers, including women, was ensured. Lodges had their own sick, funeral, superannuation and other benefits and there were no regular subscriptions to central funds. There was a general levy of members to acquire land and set up workshops, however. Membership was said to have reached somewhere between a half million and one million within a few weeks, although there was no accurate record of the membership and it is believed that there were only 16,000 paid-up subscribers so the figures have little real significance. The aim was syndicalist government, founded on a pyramid system of representation. Owen opposed strikes because he believed that unions thus used were part of the class war, rather than being used as a means of social regulation. Owen himself always opposed the class struggle. When the true class war came to a head in the summer of 1834, Owen bailed out, disassociating himself from the Grand National Consolidated Trades Union which he himself had set up. Owen failed to understand the cruelties of life in the 1800s, where men and women rebelled against their masters. He may have sympathised with men to a certain extent , but he could not identify himself with them. The “Grand National” began to break up owing to its inability to provide adequate support for sections of its membership who were on strike and the skilled craftsmen fell back where they could on the local guilds and societies and we hear comparatively little of industrial unions until the 20th Century.
In 1835 Owen renewed the attempt to found a community. This time the attempt was made through a distinctly working class body. This was variously named the Association of All Classes of All Nations (1835-39), the Universal Community Society of Rational Religionists (1839-42) and the Rational Society (1842-46). At its peak in 1841 there were 70 or so branches spread throughout Great Britain. In key centres, such as Manchester and London, meeting halls were built (the Halls of Science) and regular indoor and outdoor propaganda meetings held under the auspices of ‘Social Missionaries’. By late 1839 the efforts bore fruit with the opening of a community at Queenwood in Hampshire. This became known as Harmony. In the summer of 1845 Harmony was sold off. Yet another failed project.
Robert Owen is generally described as a philanthropist and utopian socialist but he was first and foremost a capitalist. He was never reconciled to the class conflict which the trade union struggle brought. New Lanark was not a socialist experiment. Owen and his partners owned it and he directed it personally with very little democratic input or participation from the workers. Private ownership and the profit motive remained in spite of the more humanistic measures that Owen certainly adopted. Thus the failure of the New Lanark model to spread was not really a failure of a socialist model as it was the failure of Owen’s own paternalistic humanitarianism. At Harmony the aspirations of working men and women were sacrificed to the demands of the profit system. Capitalism still held control, and the working people there remained its victims. It is also relevant to mentioned that the type of worker brought to New Lanark was of a rather homogenous type: Scottish workers of Calvinist backgrounds who were inclined to discipline, uncomplaining labour and personal self-improvement – complacent compliant wage-slaves.
Whereas at New Harmony even the poorest families were accustomed to work only a few months each year and then to spend the rest of their time “in doing nothing, in drinking and in talking politics, which tend to nothing” and they also questioned submitting to Owen’s authority, whether paternalistic or not.
Owen had rebelled against the “trinity of evils:” private property, religion, and marriage founded on property and religion. He developed a plan of progressive paternalism in his communes – curfews, house inspections, and fines for drunkenness and illegitimate children. He equated happiness with docility, and as a result was criticised for condescending to the working class. The importance of the Owenites is that for the first time a complete change in the nature of society was contemplated by a section of the working class. Owen contrasted the “brutal selfishness” of individualism with the rational self-interest of co-operation, which recognises the individual’s own interest in the welfare of the community. Owen was therefore a revolutionary because he wanted to change attitudes. Owen recognised, unlike most Chartists, that political democracy is not the solution in itself to capitalist misery. When the Grand National collapsed from the combined offensive of government, courts and employers the workers began to think that to gain power they would first need to gain the vote. Owen did not share this “Chartist” dream. He believed that whilst there are rich and poor, the rich will rule – whoever has the vote. He, however did not fully appreciate that the vote sought by Chartists could in fact be a means to an end.
A distinctively socialist political economy did eventually emerge within sections of the Chartist movement. Ernest Jones, for example, dismissed the demand for “a fair day’s wage for a fair day’s work”, which was to ask for:
“a golden slavery instead of an iron one. But that golden chain would soon be turned to iron again, for if you still allow the system of wages slavery to exist, labour must be still subject to capital, and if so, capital being its master, will possess the power and never lack the will to reduce the slave from his fat diet down to fast-day fare!”
Owen had a vision of a multitude of independent co-ops linked to form a co-operative world. As people learnt the new morality, the need for government would fade away and prisons and punishments would also become unnecessary. The false, individualistic morals of competitive society are the “sole cause which renders law necessary in society” as Owen explained in 1833. In the new order there would be disagreements between people and between groups, but they would be fewer and could be resolved by arbitrators skilled in the practice of the new morality. Owen wrote that if everyone was “trained to be rational, the art of war would be rendered useless”. In 1833 he told people that the co-operative system would not only be free of litigation, it would be free of war, and until that object was achieved one of the main aims of the co-operative movement was to be a peace movement:
“One of their chief offices, until the ignorance which causes the evil shall be removed, will be to reconcile man to man, and nation to nation throughout the world, and to enable all to understand that they have but one interest, which is, to insure the permanent happiness of each and all”.
The origins of the co-operative movement go back to Robert Owen in the early nineteenth century. The Rochdale Pioneers, founders of the modern cooperative movement, were Owenites and the modern secularist movement can also trace its ancestry back to the Owenite movement of the 1840s. The utopians’ shared ideals of cooperative effort and their creation of small-scale communities contributed to anarchist political theory as well as the communal traditions of the kibbutz movement and the American counter-culture of the 1960s and 1970s.
Co-operatives cannot be used as a means for establishing socialism. As long as the capitalist class control political power, which they will be able to continue to do for as long as there is a majority of non-socialists, capitalist economic relations (commodity production, wage labour, production for profit, etc.) will be bound to prevail and these will control the destiny of co-operatives. Co-operatives usually only flourish to the extent that they can be successfully accommodated within capitalism. Instead of the “ethos” of the Co-operative Movement transforming capitalism, it was the other way round: the ethos of capitalism transformed the co-ops. This was because they had to compete with ordinary capitalist businesses on the same terms as them and so were subject to the same competitive pressures, to keep costs down and to to maximise the difference between sales revenue and costs (called “profits” in ordinary businesses, but “surplus” by the co-op). The co-operative movement was out-competed and is now trying to survive on the margin as a niche for “ethical” consumers and savers, leaving the great bulk of production, distribution and banking in the hands of ordinary profit-seeking businesses.
Appendix
SPGB 1989 Conference:
“This Conference reaffirms that is: ‘In the minds of many workers the Co-operative movement is regarded as being in some way linked up with socialism. When the co-operators take up this attitude they claim in justification that Robert Owen, the co-operative pioneer, was actively concerned for some part of his life with possible means of escape from the capitalist system …Robert Owen’s solution was that small groups of workers should try to establish self-supporting ‘villages of industry’, in which there would be no employer, no master. They would constitute, as it were, little oases in the desert of capitalism, owning the ‘land and means of production common’. He anticipated that the movement would grown until finally the workers would have achieved their emancipation …The Co-operative Movement cannot solve the basic economic problems of the workers as a whole, or even of the co-operative societies’ own members. Its success is merely the success of an essentially capitalist undertaking …Co-operation cannot emancipate the working class. Only Socialism will do that. The workers cannot escape from the effects of capitalism by retiring into Owen’s ‘villages of industry’. They must obtain for society as a whole the ownership of the means of production and distribution, which are the property of the capitalist class. For this they must organise to control the machinery of government. Once possessed of power they can then reorganise society on a socialist basis of common ownership. Owen’s original aims can only be achieved by socialist methods’.” – carried
