The Industrial Revolution:A Godsend

A presentation by Dr. Kevin T. BradyJune 21, 2012

Pennsylvania Social Studies Standards – Industrial Revolution

• 8.3.D. Identify and evaluate conflict and cooperation among social groups and organizations in United States history from 1890 to the Present.

• 8.3.12. Labor Relations (e.g., rise and decline of industrial unions, free trade agreements, imports impact on domestic employment)

• 8.3.12. Immigration and Migration (e.g., anti-immigrant attitudes, quota laws, westward and southward migration)

Social Studies Standards – State of Florida

• SS.912.A.3 Industrial Revolution• Analyze the transformation of the American economy and the

changing social and political conditions in response to the Industrial Revolution.– SS.912.A.3.5 Identify significant inventors of the Industrial

Revolution including African Americans and women.

STANDARD VIEW OF THE INDUSTRIAL REVOLUTION

The Industrial Revolution led to widespread penury for a multitude of impoverished people who had moved in from the farms or had immigrated

to America.

ECONOMIST & PHILOSOPHER – LEOPOLD KOHR

The Breakdown of Nations (1957)“Tremendous rise in reform movements

and social criticism in the wake of the Industrial Revolution must have been an indication of worsening conditions.”

“An increase in reform movements is a sign of worsening, not of improving, conditions. If social reformers were rare in former ages, it could only have been so because these were better off than ours.”

Au Contraire!

KOHR HAD IT BACKWARDS!

This view came from Marxist historiography, prevalent in the 1950s and 1960s.“Because theoretical preconceptions, which guided them, postulated that the rise of capitalism must have been detrimental to the working classes, it is not surprising that they found what they were looking for.” F.A. Hayek

PROSPERITY CAUSED CONCERN

“The very fact we hear complaints in the late 18th and early 19th century about appalling conditions in which many people lived and worked is, ironically enough, a point in the Industrial Revolution’s favor.”

“Before the Industrial Revolution, everyone fully expected to live in abject poverty, and what is more, they fully expected a similar fate for their descendants.” F. A. Hayek

POVERTY BEGAN TO SEEM ABNORMAL

The overwhelming wealth and abundance that the Market Economy had produced highlighted and amplified pockets of poverty scattered in various sections of cities and in the countryside. Earlier, when most people lived in abject poverty, no one noticed or expressed outrage. The abundance from the market economy achieved raised standards and aspirations of people at all economic levels.

FRIEDRICH A. HAYEK

“What for ages had seemed a natural and inevitable situation, or even as an improvement upon the past, came to be regarded as incongruous with the opportunities that the new age appeared to offer.”“Economic suffering both became more conspicuous and seemed less justified, because general wealth was increasing faster than ever before.”

ECONOMIST, JOSEPH SCHUMPETER

The stupendous wealth created by the Free Market, ironically, enabled the enemies of capitalism to occupy the position of full-time intellectuals, enjoying the leisure and civilization that the free market they so hated made possible. Schumpeter believed that the intellectuals’ opinions would eventually destroy the free market.The intellectuals, with no economic experience, would wear down the public’s support for capitalism and replace it with a socialist system.Schumpeter believed that the tremendous success of the free market would sow its eventual destruction.

IT WAS THE FREE MARKET THAT HAD CREATED THE PROLETARIAT, OR THE WORKING CLASS.

The Industrial Revolution created new opportunities for work.Many more people could survive.It also provided a chance for upward mobility, long denied to the vast majority of people.

PRE-INDUSTRIAL REVOLUTION

People lived in a subsistence economy.Prior to the Industrial Revolution, those without land or skills had a very hard life.The Proletariat had nothing else to offer the market and sold their labor for wages

PEOPLE’S CHOICE

People moved to the factoriesPeople left towns with hour laws to work more hoursPeople moved to places where their kids could workChildren worked much harder on the farm

THE STANDARD TEXTBOOK TALE

Peasants were happy on their farms, out in the fresh air.Artisans under the domestic system had enjoyable lives working in their chosen trades. Artisans worked in their own homes and enjoyed a modest economic independence, since they owned a garden plot and received payments for their work.THEN “the Industrial Revolution fell like a war or a plague” on these previously happy folk.The new factory system reduced the free artisan to virtual slavery.The Industrial Revolution lowered the standard of living to the level of bare subsistence.Women and children were jammed into mills.The Industrial Revolution destroyed family life, sucked the very life from society and destroyed morality and public health.

LUDWIG VON MISES

“Conditions prior to the Industrial Revolution were in fact catastrophically poor. Right before the Industrial Revolution

the economy was hopelessly static, and possessed no outlet whatsoever for the increasingly sizable number of people for whom a

living in agriculture or domestic manufacture was impossible.”

PEOPLE CHOSE TO WORK IN THE FACTORIES

People took factory jobs of their own free will.This indicates that these jobs, however repugnant to us, gave the worker the best opportunity they had available at the time.Industrial employment was a voluntary system. Factory owners could not force workers to become employees.As low as wages were, they were better than workers could earn elsewhere.

PRESENTISM?

During the first few decades of the Industrial Revolution, wages were shockingly bad when compared with the conditions of the contemporary upper classes (a small minority) and present conditions of today’s industrial workers.

They had long hours and deplorable sanitary conditions.

Still, workers thronged into the factories as their salvation.

WHAT WAS THEIR ALTERNATIVE?Prior to the Industrial Revolution, the trades catered to the wants of the well-to-do.

The expansion of the tradesmen’s income was based on how many luxuries the rich

could afford.

WITH THE INDUSTRIAL REVOLUTION:

MASS PRODUCTION opens production for the MASSES.Workers are the main customers.They no longer toiled merely for other people’s well-being.Big business caters to the needs of the masses.

ENTREPRENEURISM

The very principle of capitalist entrepreneurship is to provide for the common man . . . In the market economy there is NO other means of acquiring wealth

than by supplying the masses in the best and cheapest way with all goods they ask for.

-Ludwig von Mises

BIBLIOGRAPHY FOR FURTHER READING

McCraw, Thomas K. Prophet of Innovation: Joseph Schumpeter and Creative Destruction. Cambridge: Belknap Press of Harvard University Press; (April 30, 2007)Woods, Jr. Thomas E. “A Myth Shattered: Mises, Hayek, and the Industrial Revolution How Did the Industrial Revolution Affect Living Standards.” The Freeman: Ideas on Liberty. November 2001 • Volume: 51 • Issue: 11Cipolla, Carlo M. Before the Industrial Revolution: European Society and Economy, 1000-1700. New York: W.W. Norton & Co.; 3rd edition (March 17, 1994).