Quakers & Capitalism — Transition: Seebohm Rowntree and the Awakening of ‘Liberal’ Economic Consciousness
June 15, 2011 § 4 Comments
The second major transition in Quaker economic culture caused a dramatic shift away from the double-culture period of the 1700s and 1800s, in which Friends had withdrawn from the world around them in virtually every sphere of human activity but one—industry, commerce and the practical arts and sciences. In these areas, they played a truly significant role. Beginning around 1895, however, external forces combined with trends within Quakerism to draw (or even force) Friends out of their shell and reawaken them to responsibility for the wider social order.
In historical moments like these, key individuals often serve as a bridge into the new culture and its ethos. These Friends respond to the changes going on around them with new sensibilities. They speak and act and live in ways that lead the rest of the Society in a new direction. In this second major transition period, a number of extraordinary individuals shine out in this regard: Rufus Jones and John Wilhelm Rowntree are perhaps the best known. Less well known but equally important, at least in his influence on Quaker economic history, is Benjamin Seebohm Rowntree.
The external forces to which he responded include the plight of the industrial poor, whose conditions remained awful, in spite of efforts throughout the 19th century to deal with the problem: the New Poor Laws of the 1830s in England, the rise of organized philanthropic giving, and attempts at reform by individual business owners, in which Friends often led the way. By 1895, these efforts at reducing poverty and helping the poor were no longer new, but something else was: the emergence of what we now call the social sciences: psychology, sociology, and the discipline of economics itself. In the field of sociology, especially, brilliant new thinkers published groundbreaking work during this period of intense social change.
Karl Marx is sometimes called the true father of sociology, though Auguste Comte and Emmanuel-Joseph Sieyes independently coined the term in the 1830s, and Herbert Spencer pushed the science along in the 1870s and 1880s, but it was Emile Durkheim who laid the foundation for the discipline as a science and set up the first sociology department in a university in 1895. Max Weber (1864-1920) began writing prolifically in the late 1880s about social policy and began work on his landmark book The Protestant Ethic and the Spirit of Capitalism in 1904. Weber was keenly interested in economics throughout his career. But it was a man named Charles Booth (1840-1916) who inspired Seebohm Rowntree.
Booth conducted the first scientific sociological statistical study in history, ultimately interviewing thousands of households of the poor in London, beginning in the East End. He published the first fruit of his research in 1889 and went on to publish a total of 17 volumes through 1903. He invented the concept of the ‘poverty line’ and proved that 35% of Londoners lived in abject poverty and that the vast majority of them worked. Here was scientific proof that the poor were poor, not because of their moral character, as had been assumed for centuries, but because they did not earn enough in their work. Poverty resulted, not from moral failure but from systemic failure. They may have had too many children; they may have spent some money on drink, gambling and other vices or diversions, but the real problem was that they didn’t have enough money in the first place.
However, Booth’s The Life and Labour of the People of London was inaccessible, too huge and too dense to reach any but the most interested intellectuals. Among the intelligentsia, it sparked intense debate. Were these problems confined to the capital, or were the provinces beset with similar conditions? Put another way, was capitalism the problem, or was it London? Seebohm Rowntree set out to answer this question by applying Booth’s new statistical, sociological methods to his own home town of York, where only two employers controlled most of the economy: the railroad and his own family’s chocolate business.
Rowntree surveyed 11,560 families, representing 46,754 of York’s population of 75,812, roughly 60% of the city. He defined two classes of poverty: “primary poverty,” affecting people who lacked the financial resources to provide for themselves even the basic essentials—10% of the total; and “secondary poverty,” in which earnings would suffice for basics, except for “other expenditures, either useful or wasteful”—18%. In other words, close to one third of York’s population was poor. More importantly, half of the people living in primary poverty had regular jobs!
Like Booth, Rowntree concluded that poverty resulted, not from bad character (though gambling, drink and other bad habits were often aggravating the problem), but from low wages. The traditional Quaker virtues that had helped to make Quakers so successful, like prudence and thrift, simplicity and moderation, and Puritan abandonment of the world’s pleasures, would help these people hardly at all. And philanthropy could hardly touch their condition, let alone change it. Poverty and its ills were inherent in the character of capitalism itself, not in the character of its workers. The poor were victims, not causes, of their suffering. And paternalistic attempts to solve the problem by morally elevating the poor were ill conceived and failed to address the causes of the problem.
Rowntree’s book had a tremendous impact. It was well organized, well written, it was short and accessible, and it struck a chord. It spoke to the liberal-scientific worldview that was emerging at the time and it resonated with other reformist forces at work in English and American society. Other well-received books and Parliamentary reports had sparked a lively debate about poverty and social reform in society and in the press. The suffragette movement was on the rise and so was labor and socialism and, in America, Progressivism. Reaction to the labor movement was becoming violent; the police riots against strikers in Chicago’s Haymarket Square had taken place in 1896. The troubles in Ireland, too, had people wondering where society was going. The book became a bestseller.
Someone recommended it to Winston Churchill, then a young Conservative Member of Parliament, who couldn’t get it out of his consciousness, calling it “a book which has fairly made my hair stand on end.” He wrote and spoke about it repeatedly and reviewed it for a military journal. It ignited both his moral conscience and his creative imagination and redirected his political career. Ultimately, he joined the Liberal government that formed in 1906.
In 1908, Churchill became President of the Board of Trade and Lloyd George became Chancellor. The two men joined forces to bring sweeping reforms to the political economy and Rowntree’s book, and Rowntree himself, figured prominently in their work. George, who had been an MP since 1890, had risen from humble beginnings himself and devoted his whole career to alleviating poverty. George and Rowntree became friends and George would brandish Poverty as he spoke to large crowds all over Great Britain campaigning for the New Liberalism that he, Churchill and others had inaugurated in 1906. Though their People’s Budget and the social legislation it funded provoked a short-lived constitutional crisis in the House of Lords, in 1911 Parliament passed the National Insurance Act, providing for state-funded insurance for unemployment, sickness and old age. The modern welfare state had been born and Poverty: A Study in Town Life had provided much of the prevailing argument for radical systemic change, with its clear exposition, demonstrable evidence and straightforward, scientific approach.
The book inspired more such studies in other regions of the country. It heavily influenced Churchill’s own 1909 publication, Liberalism and the Social Problem. Rowntree was named to a government committee to study land, land tax and housing issues. The committee applied Rowntree’s methodology to these problems in the years 1912-1914. Thus Rowntree became an expert on land reform and this remained an abiding concern throughout his life. He championed the creation of garden cities, in particular, in order to diversify the agricultural system and relieve some of the pressures threatening both the health of workers and the dwindling rural areas. Beginning in England in 1910 and soon spreading to the U.S., the garden city movement favored relatively low-density planned communities with lots of open space, including, usually, a green belt encircling the housing and areas with flexible zoning that could support local industry and commerce. He also came to believe that the labor movement was an essential part of economic reform.
But what did the Rowntrees do about the subject of Seebohm’s book, poverty in the city of York and Rowntree’s own family business? Poverty encouraged Seebohm’s father, Joseph Rowntree, to build new rental housing, what we would call today low- and moderate-income housing. Despite his efforts to provide acceptable accommodations at the lowest possible cost, however, these apartments remained beyond the means of the very poor, the people for whom he’d intended them. According to James Walvin (The Quakers: Money & Morals), the welfare services provided by the company represented 0.8% of gross selling price in 1908. Joseph Rowntree kept improving the company’s benefits, adding profit sharing, better sick pay, paid vacations, and convalescent facilities. But the basic problem remained: wages.
Rowntree laborers were paid by the piece. Joseph Rowntree set up a process for wage review every three months and he monitored wages. If someone fell below the ‘poverty line’ that his son’s book had so popularized that he often is credited with its invention, rather than Booth, the company moved the worker to different work or encouraged them to work harder. Those who couldn’t make it were dismissed or encouraged to find another job. Departments were evaluated according to the percentage of employees that were making more than the minimum wage. Meanwhile, although Seebohm Rowntree agreed with labor unions in principle, in practice, he resisted them in his own plants. Quaker paternalism was not dead yet.
Nevertheless, in both his book and his long and distinguished career in public service, Seebohm Rowntree helped lead Friends through the transition into the twentieth century and its liberal engagement with social problems. By ‘liberal’ I mean an optimistic faith in the ability of society (meaning, mostly, government, but also civil society) to change things by studying them, proposing solutions, developing programs, and creating institutions for implementing the programs. Rowntree came to believe in state regulation of aspects of the economy “to over-ride the immediate interests of the employer by imposing on him (sic) obligations which are to the advantage of the nation rather than his (sic) own.” This was a fundamental break from the double-culture compromise forged in the persecutions of the first transition period, that Friends would leave the state and the foundations of the social order alone, as long as they were left alone in turn. Under the leadership of Seebohm Rowntree and other young reform-minded Friends, Quaker religion once again became a public, and not just a private, affair.
Poverty: A Study of Town Life launched Rowntree on an exceedingly prolific writing career; Amazon lists 26 books. Poverty itself is available from Google Books for free as a download here. And here’s a link to a bibliography of Rowntree’s writings, to give you a sense of the range of his interests. Four main themes dominate his work: He returned again and again to the problem of unemployment and he wrote several books on housing. He wrote about the Christian and the Quaker responses to social problems. And he wrote several books trying to humanize business and industrial relations. He also applied for a patent in chocolate manufacturing.
This extraordinary man deserves our thankful remembrance for the following landmark achievements:
- Groundbreaking work—understanding poverty. Poverty is the second attempt in history to use a sociological survey (and statistical analysis) to understand a social problem (poverty) and to shape a meaningful policy response.
- Defining the “poverty line”. Rowntree is widely credited for inventing the idea of the “poverty line,” an income level below which a person or a family can no longer provide for the basics of food, clothing and shelter. I believe, however, that again we can thank Charles Booth for this innovation. However, Rowntree put it on the map and I believe he revised Booth’s calculations to make them reflect reality a little more accurately, though most economists today agree that it still needs to be redefined. The current formula for the poverty line (at least in America) comes originally from an American economist from the Roosevelt administration named Mollie Orshansky, who based her own work on Rowntree’s. The idea really caught on with the War on Poverty in the 1960s. Once a ‘scientific’ way to define poverty had been established, Rowntree (and before him Booth) came to a revolutionary and truly startling conclusion:
- Groundbreaking conclusion—the poor are poor through no fault of their own. Rowntree’s research proved that poverty was not primarily the result of personal moral failing, but was rather a systemic, structural problem endemic in the capitalist system itself. It proved that the vast majority of the poor actually worked, worked hard, too hard; they just didn’t make enough money to survive—their wages were too low. It was not indolence, drink, gambling, sex (too many kids), and general wantonness that had cast them into poverty, as most people believed until then, though these factors often made things worse. The real problem for the poor was not at its root moral; it was structural—it was low wages. The poor wanted to work, they did, in fact work. It just wasn’t enough to lift them up out of poverty.
- Groundbreaking paradigm—social science and technocratic solutions. This helped to usher in the modern social scientific approach to understanding and treating social problems. Poverty showed that scientific methods yielded results that you could not arrive at using moral philosophy, and it helped to pinpoint where and what the problems really were. This did not put an end to moralizing, as we well know. Conservatives, especially, have continued to cite moral failure as the cause of social ills up to the present day. Now, however, they must also downplay, discredit, bypass and obstruct scientific arguments that clearly point to structural evils in the system. Rowntree’s book ushered in an age of warring paradigms in social policy. One of them was rooted in 19th century evangelical theology and the political economics it had nurtured, focused on individuals, their choices and their ‘freedom’ from government intervention. The other paradigm was rooted in science and focused on communities, on systemic causes and solutions to social problems, and on the roles that only government was in a position to play in addressing these issues.
- Groundbreaking policy—the birth of the welfare system. The book led directly to the modern welfare state in England and, by extension, everywhere else in Europe and North America.
- The end of the ‘double culture’ period and the reengagement of Quakers. Seebohm Rowntree was part of the generation of modernist Friends that remade Quaker culture around the turn of the 20th century. They included his cousin John Wilhelm Rowntree, Rufus Jones and a number of others who had been energized by the Richmond Conference in 1887 and the Manchester Conference in 1895. They were the internal force for change within the Society of Friends that met the external forces that helped shape what I call the second great transition period in Quaker history, moving us from the double culture of religious and social withdrawal, on the one hand, combined paradoxically, on the other hand, with energetic engagement with the worlds of business, industry and commerce. They pulled us out of our isolation and insulation until both our feet were planted in the modern world.
- Quakers discover capitalism as a system. Seebohm Rowntree’s landmark book and methods opened Quaker eyes to capitalism as a system. Until then, Quaker testimonial life had regarded the ‘social order’ as a matter for individual attention; that is, on the one hand, as a matter for the discipline of personal behavior, of “right walking” over the world, while on the other hand, individual Friends and Friends’ meetings had focused their efforts to address social ills like poverty on individuals. Recall Elizabeth Fry’s work in Newgate Prison raising up the educational and moral levels of inmates. With Poverty, Friends became aware for the first time of structural evil, of the way that systems caused suffering. This new awareness took a long time mature. It got major reinforcement, at least in the UK, during the Great War, when London Yearly Meeting convened a Committee on War and the Social Order and approved the Eight Principles of a Just Social Order in the 1918 sessions of London Yearly Meeting, which I’ve discussed in an earlier post. Nevertheless, it was not until the 1960s that systemic thinking really began to shape Quaker testimonies in any meaningful way: Right Sharing of World Resources addressed global trade policy; AFSC turned increasingly from service to the suffering toward advocacy on behalf of the oppressed; and the War in Vietnam vividly illuminated the power and role of the “military industrial complex” in our economic life. The war also brought Marxism back to life; Marx and Engels had understood that capitalism as a system oppressed the working class way back in the middle of the 19th century. But Quakers never really warmed to Marxism, even though Das Kapital mentioned their own John Bellers by name, and even though a small, very active group of socialist Friends did emerge in the same period in which Rowntree was doing his work late in the 1800s.
For all these monumental contributions to the cause of a more just and compassionate political economy, Benjamin Seebohm Rowntree is one of my heroes. He also is one of the unsung heroes in the history of Friends. And so I have become one of his modern champions.
Note: On Tuesday, December 21, American Public Media’s daily financial news radio magazine Marketplace featured a piece on Benjamin Seebohm Rowntree (1871-1954). It’s not a bad introduction to this extraordinary man. Here is the link.