It may be objected that such a standard is unattainable. There are those, it may be contended, who are not, and never will be, worth a full efficiency wage. Whatever is done to secure them such a remuneration will only involve net loss. Hence it violates our standard of economic justice. It involves payment for a function of more than it is actually worth, and the discrepancy might be so great as to cripple society. It must, of course, be admitted that the population contains a certain percentage of the physically incapable, the mentally defective, and the morally uncontrolled. The treatment of these classes, all must agree, is and must be based on other principles than those of economics. One class requires punitive discipline, another needs lifelong care, a third—the mentally and morally sound but physically defective—must depend, to its misfortune, on private and public charity. There is no question here of payment for a function, but of ministering to human suffering. It is, of course, desirable on economic as well as on broader grounds that the ministration should be so conceived as to render its object as nearly as possible independent and self-supporting. But in the main all that is done for these classes of the population is, and must be, a charge on the surplus. The real question that may be raised by a critic is whether the considerable proportion of the working class whose earnings actually fall short, as we should contend, of the minimum, could in point of fact earn that minimum. Their actual value, he may urge, is measured by the wage which they do in fact command in the competitive market, and if their wage falls short of the standard society may make good the deficiency if it will and can, but must not shut its eyes to the fact that in doing so it is performing, not an act of economic justice, but of charity. To this the reply is that the price which naked labour without property can command in bargaining with employers who possess property is no measure at all of the addition which such labour can actually make to wealth. The bargain is unequal, and low remuneration is itself a cause of low efficiency which in turn tends to react unfavourably on remuneration. Conversely, a general improvement in the conditions of life reacts favourably on the productivity of labour. Real wages have risen considerably in the last half century, but the income-tax returns indicate that the wealth of the business and professional man has increased even more rapidly. Up to the efficiency minimum there is, then, every reason to think that a general increase of wages would positively increase the available surplus whether that surplus goes to individuals as profits or to the State as national revenue. The material improvement of working-class conditions will more than pay its way regarded purely as an economic investment on behalf of society.
This conclusion is strengthened if we consider narrowly what elements of cost the “living wage” ought in principle to cover. We are apt to assume uncritically that the wages earned by the labour of an adult man ought to suffice for the maintenance of an average family, providing for all risks. It ought, we think, to cover not only the food and clothing of wife and children, but the risks of sickness, accident, and unemployment. It ought to provide for education and lay by for old age. If it fails we are apt to think that the wage earner is not self supporting. Now, it is certainly open to doubt whether the actual addition to wealth made by an unskilled labourer denuded of all inherited property would equal the cost represented by the sum of these items. But here our further principle comes into play. He ought not to be denuded of all inherited property. As a citizen he should have a certain share in the social inheritance. This share should be his support in the times of misfortune, of sickness, and of worklessness, whether due to economic disorganization or to invalidity and old age. His children’s share, again, is the State-provided education. These shares are charges on the social surplus. It does not, if fiscal arrangements are what they should be, infringe upon the income of other individuals, and the man who without further aid than the universally available share in the social inheritance which is to fall to him as a citizen pays his way through life is to be justly regarded as self-supporting.
The central point of Liberal economics, then, is the equation of social service and reward. This is the principle that every function of social value requires such remuneration as serves to stimulate and maintain its effective performance; that everyone who performs such a function has the right, in the strict ethical sense of that term, to such remuneration and to
