Who do you imagine said this?
“[Trade-unions] seem natural to the passing phase of social evolution, and may have beneficial functions under existing conditions. . . .”
If you guessed some wily labor leader or social democrat, you are wrong. British laissez-faire advocate Herbert Spencer (1820-1903) wrote those words in his Principles of Sociology (1896). Spencer was the most prominent and respected individualist philosopher of his time. To this day his voluminous scholarly and popular writing remains an important resource for adherents of the freedom philosophy.
Spencer’s statement, then, may surprise some readers. It shouldn’t. Our libertarian forebears put the plight of workers at the top of their concerns. In England feudalism had not entirely disappeared, many people had been pushed off the land through enclosure, and true laissez faire was nowhere in evidence. Neomercantilism, or what Albert Jay Nock called the “Merchant-state,” was the rule. For example, early in the Industrial Revolution worker “combinations” were outlawed in England and people were not free leave their home parishes in search of better employment opportunities, something decried by Adam Smith. When these laws were finally repealed, workers were hampered by other state interventions, such as land engrossment, patents, government-backed banking cartels, and tariffs. To be sure, living standards improved, but to the extent that government stifled free competition, workers were deprived of bargaining power and their full free-market reward.
Spencer is famous for setting out a theory of social evolution, according to which society was moving from the rigidly hierarchical “militant” type to the open, contract-based “industrial” type. Society was still in transition and had a long way to go. (See my “Austrian Exploitation Theory.” )
Spencer begins his discussion of unions by noting that worker guilds (like employers) historically preferred suppression of competition to the uncertainties of market rivalry. He criticizes the hypocrisy of workers who applaud competition that lowers the price of bread, but oppose competition that lowers the price of labor. He also argues that agitation for higher wages, if successful throughout the economy, would do workers no good because prices and hence the cost of living would rise as a consequence. (This analysis requires some assumptions that may not in fact hold.)
But he also notes that “[u]nder their original form as friendly societies—organizations for rendering mutual aid–[unions] were of course extremely beneficial; and in so far as they subserve this purpose down to the present time, they can scarcely be too much lauded.”
Nevertheless Spencer asks: “Must we say that while ultimately failing in their proposed ends [higher wages], trade-unions do nothing else than inflict grave mischiefs in trying to achieve them?”
His response: “This is too sweeping a conclusion. . . . There is an ultimate gain in moral and physical treatment if there is no ultimate gain in wages.” For example:
Judging from their harsh and cruel conduct in the past, it is tolerably certain that employers are now prevented from doing unfair things which they would else do. Conscious that trade-unions are ever ready to act, they are more prompt to raise wages when trade is flourishing than they would otherwise be; and when there come times of depression, they lower wages only when they cannot otherwise carry on their businesses.
Knowing the power which unions can exert, masters are led to treat the individual members of them with more respect than they would otherwise do: the status of the workman is almost necessarily raised. Moreover, having a strong motive for keeping on good terms with the union, a master is more likely than he would else be to study the general convenience of his men, and to carry on his works in ways conducive to their health.
He thinks unions are necessary because: “Everywhere aggression begets resistance and counter-aggression; and in our present transitional state, semi-militant and semi-industrial, trespasses have to be kept in check by the fear of retaliatory trespasses.”
Spencer, however, is not satisfied with this state of affairs. Recall that he says trade-unions belong to “a passing phase of social evolution.” Passing to what?