Ricardo's Principles: a mini-tutorial conclusion
Source Jim Devine
Date 13/02/07/14:58
November 19, 2011

It seems appropriate that I should bring this mini-tutorial to a close
with a discussion of Ricardo's brief but extraordinary chapter on
Machinery. His argument there, it seems to me, shows him at his very
best, while also exhibiting the theoretical and ideological
limitations of the Classical school to which Marx directed his most
penetrating criticism. Ricardo's purpose in including the chapter is
to correct a mistake of which, he says, he had previously been guilty.
This in itself sets him off from the common run of theoreticians in a
variety of disciplines these days, who think it a death blow ever to
acknowledge that they have been mistaken.

The question at issue, Ricardo says in the first sentence of the
chapter, is "the influence of machinery on the interests of the
different classes of society." Take a moment to examine the phrasing
of that question. I venture to suggest that there is not a single
established economist in America today, including such liberal icons
as Robert Reich and Paul Krugman, who could ever bring himself or
herself to write a sentence in which appears the phrase "the interests
of the different classes of society." Even to utter such a combination
of words would be to elicit hysterical charges of "class warfare," and
yet Ricardo writes the sentence with no suggestion that he intends to
be provocative or to deviate from accepted norms of polite
intellectual behavior. In this, as in many other ways, the
mathematically sophisticated discourse of our modern professional
economists exhibits a marked falling away from the understandings that
the first Political Economists had achieved by the beginning of the
nineteenth century. It is instructive in this regard to read Marx's
discussion of those early figures in the three volume Theories of
Surplus Value with which Capital concludes. Despite his strong
disagreements with the best of them -- Quesney, Destutt de Tracy,
Smith, Ricardo and the rest -- Marx is extremely respectful of them,
and goes out of his way to acknowledge where they have been correct.
This stands in striking contrast to his dismissive and mocking
treatment of those whom he calls "vulgar economists," like Nassau
Senior, for whom he has nothing but contempt.

One of the great advantages of the early Political Economists is that
they are writing at the dawn of modern capitalism, and features of
mature capitalism that today we take for granted are for them
innovations that stand in stark contrast to what has gone before. The
very novelty of markets, capitalist enterprises, wage labor, and the
rapid introduction of machinery into spheres of production previously
dominated by hand labor [or, in the original sense of the term,
"manufacture"] prompts them to ask questions that might not occur with
such urgency to those theorists who come along when these and other
features of a mature capitalism have long since become the norm.

The early nineteenth century saw the rapid introduction of machinery
in England, particularly in the textile industry. Power carders,
spinners, and looms replaced the hand-operated devices that had for
generations been used to turn linen, wool, and cotton into cloth. The
introduction of the machinery had two consequences, both of which were
devastating to a group of workers who had until then been among the
most skilled and best paid in England. First of all, the machinery
displaced thousands of weavers, who were thrown out of work and were
suddenly destitute, for the purpose of introducing the machines, of
course, was that one machine could do the work of many weavers.
Second, the machinery replaced the skilled weavers with semi-skilled
machine operators or tenders, many of whom were children as young as
eight or nine. Weaving had been a skilled craft required a long
apprenticeship and the possession of a valuable tools -- the looms and
accompanying instruments of the weaving trade. Much of that skill was
now internalized, as it were, in the power looms owned by the
capitalists and located in factories, no longer in the crofts and
cottages of the weavers. Instead of a years-long apprenticeship in the
weaving craft, only a few weeks were required to train an unskilled
boy or girl to tend a machine.

The workers threatened with redundancy by the new machines reacted
swiftly and violently. "Luddites," they were called, after Ned Ludd, a
weaver who was said [probably apocryphally] to have destroyed a
weaving machine in the late seventeen hundreds. They threw wrenches
into the machines, broke them up, and tried futilely to halt the
mechanization of the cloth industry. The movement flourished between
1811 and 1816 before being put down by the police, which is to say in
the years just preceding the writing and publication of the

Summarizing the view he previously held on this question, Ricardo
writes: "As, then, it appeared to me that there would be the same
demand for labour as before, and that wages would be no lower, I
thought that the labouring class would, equally with the other
classes, participate in the advantage, from the general cheapness of
commodities arising from the use of machinery." But now, he says, he
has concluded that he was wrong. "I am convinced, that the
substitution of machinery for human labour, is often very injurious to
the interests of the class of labourers. My mistake arose from the
supposition, that whenever the net income of a society increased, its
gross income would also increase; I now, however, see reason to be
satisfied that the one fund, from which landlords and capitalists
derive their revenue, may increase, while the other, that upon which
the labouring class mainly depend, may diminish, and therefore it
follows, if I am right, that the same cause which may increase the net
revenue of the country, may at the same time render the population
redundant, and deteriorate the condition of the labourer."

Ricardo defends this new position by working out an elaborate
numerical example, which I shall not try to summarize. He draws from
his example four conclusions. The first is that "the discovery, and
useful application of machinery, always leads to an increase in the
net produce of the country, although it may not, and will not, after
an inconsiderable interval, increase the value of that net produce [as
measured in units of embodied labor -- ed.]" ....

It is the Ricardo's third conclusion that is especially noteworthy.
Writing, keep in mind, at the very time of the height of the Luddite
uprising, he says: "the opinion entertained by the labouring class,
that the employment of machinery is frequently detrimental to their
interests, is not founded on prejudice and error, but is conformable
to the correct principles of political economy."

There is a good deal more in the eleven pages of the little chapter on
Machinery, but I think this is enough to display the quality and
integrity of Ricardo's mind. The theoretical precision of his analysis
in the Principles marks a dramatic improvement over that of Smith, as
Smith's analysis marked an advance over that of his predecessors.

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