1882 - 1870: The Great Age of Laisez-Faire?

How Valid is it to describe the period c. 1832- 1870 as the great age of laissez-faire?

In order to analyse the use and impact of laissez-faire during this time period, it is important to firstly define laissez-faire. This however is far from a simple definition, with huge debate between historians on how to accurately define such a concept. Some have associated the term with anarchy, and others have taken the other end of extreme, using it only as an introduction to private enterprise as apposed to public. Those such as Taylor have explored the term’s variety. ‘In a more precise form it has been regarded as synonymous with free trade- the more so when free trade is extended, as it was in the nineteenth century’. In simple terms however, laissez-faire is an economic system in which there is no government interference between the transactions of private parties. This form of governing had clear impacts on many economic areas in the period between 1832 and 1870, but some had more significance than others. Trade is one of these significant factors, focusing on government’s involvement in business. However there were also a great deal of impacted social factors that were clearly a product of government intervention. Factors such as poverty ,public health and education have all spurred discussion amongst historians on the implementation of laissez-faire at this time and wether it really was the focal form of governing. There is also the development of Jeremy Bentham and the impact he and his followers had on laissez-faire during these years.

Free trade is arguably one of laissez-faire’s most positive economic outcomes, and for many represents the idea overall. Trade that would be free of any restriction or tariff was a bold step forwards. This was intended to spur the country’s economy through the wider possibilities of importing and exporting goods, allowing huge amounts of growth in a short amount of time. Many credit the work of those such as Peel and Gladstone for the movement towards free trade. They were responsible for a great deal of freedom on imports, with Peel removing the import duties on as many as 600 articles. Yet others have argued that laissez-faire principles alone did not allow for this change. ‘The achievement of free trade was a result of a combination of forces of which the ideological pressures of laissez-faire was only one.”’ Without the demand for cheap food, or the financial problems of the government, there is very little chance that the claims of laissez-faire alone would have made a great enough impact to achieve free trade. However, nearing the later half of the nineteenth century, the very aspects of free trade that had made it such a positive change began to backfire. Britain came under a huge amount of pressure due to the demand created by foreign competition, and for a period of time created a great deal of stress on the economy. However the same demand for cheap food along with financial government issue halted the action to put trade under protection once again. Without intervention this issue would have only grown.

It is clearly very difficult to calculate the exact outcome laissez-faire principles had on Britain’s economy during this time period, as explained by Lee. ‘ It might be argued that it is impossible to quantify the economic effect of political withdrawal: after all how can one measure the success of the absence of policy?’ However, there is a way to view the policy on laissez-faire positively. It set up a clear framework which in effect allow for further economic expansion. So it is clear that laissez-faire principles did have their impact on the movement towards free trade, which had hugely beneficial qualities to the British economy, but does it’s partial involvement contribute to the idea of a “great age of laissez-faire”? Of course laissez-faire played it’s part in the process allowing for positive results in free trade, but it was clearly not the soul factor for such economic success.

Social factors also reflect the amount of intervention from the government between 1832 and 1870, specifically addressing reform in poverty. Areas of government action such as the poor law of 1834 are used by many historians to argue there was a lack of social issues that benefited through laissez-faire, and that such intervention was clearly present and necessary. The origins of the poor law date back much further than the nineteenth century. Previously parishes had dedicated a great deal of money to those in need of financial help. This came in the form of food, shelter, or even instalments of money. This however became unpopular as many believed it would encourage laziness amongst the lower classes. This meant that the new poor law would inevitably have to be bold and appealing to those already in opposition. The idea was to decrease the costs of aiding the poor whilst housing as many beggars as possible to keep them off the street. The answer came in the form of the workhouse. Those unable to find their own means of income to have a consistent living were forced to enter these labour houses. ‘The real cruelty of the new workhouse lay in the psychological harshness.’ They would provide basic accommodation and food at the price of long hard labour. Men, women and children would work long hard and often dangerous hours in order to earn their living. Opinion tended to vary hugely on the new poor law. ‘those who wished to retain them, those who wished to modify them and those who wished to abolish them.’ But of course this was a great solution from the government. Cheap, endless labour that would in toll expand Britain’s economy, whilst keeping huge numbers of the poor from crowding the streets. It also eradicated the idea of the poor becoming lazy, as the workhouse was such a horrific alternative that many made the extra effort to find work. Many would do anything to avoid being condemned to life in a workhouse. This is a perfect example of an issue that laissez-faire would not have been effective. ‘the poor rate had continued to grow until by 1830 it amounted to one-fit of the national expenditure and threatened to crush landed property beneath it’s weight.’ There was tremendous pressure for the government to control such a stress on the national expenditure, and leaving the issue to boil any longer would have likely created a breaking point.

The Irish Potato famine is another example of government involvement, yet on a smaller scale. The potato famine had huge consequences to the peasants in Ireland. The potato was the staple food surplus for the diet of many. It was easy to grow in a number of climates whilst having high enough nutrients to sustain a human being without the aid of another food groups. And for many it was such an effective food it was even used asa form of currency. So when famine began to hit in 1845 there were mass consequences. Starvation, disease and death swept Ireland. The country’s population took huge blows that would never recover, even in the present day. The government did intervene in aiding this disaster, yet not to it’s full ability and certainly lacked enthusiasm to do so. This is where many historians begin to spark argument. Although government did have some input in aiding Ireland, and contradicting their laissez-faire principles, it was of course nowhere near it’s full ability. This created a kind of middle ground of intervention. So in terms of social aid and reform there is a great deal of contradiction to laissez-faire. The government clearly saw that leaving issues such as poverty and famine to their own devices would not conclude well and that intervention was necessary in some shape or form.

Another larger example of state decision to abandon the concepts of laissez-faire is through public health. A Public Health act was passed in 1848 which was intended to improve a number of worrying health issues and prevent unnecessary deaths from illness throughout Britain. However for many, it was a great disappointment and it held very little value in terms of results. Yet it is a priceless act in terms of identifying the government’s need to intervene in public life. ‘much of this was important more for the way in which it marked a symbolic acceptance of change than for the impact - often rather limp- of the measures themselves.’ This then set a trend for the future to further reforms in public life in the following years including reforms to mining, prisons, education and merchant shipping.

A different take on the use and effects of laissez-faire between 1832 and 1870 has been addressed through Utilitarian Jeremy Bentham and his disciples. ‘derives in part from the influential writing of A.V. Dicey, identifying Bentham firmly with individualism and was led to refer to the period of so-called Benthamite dominance between 1825 and 1875 as the age of laissez-faire.’ Of course to any economic historian, the answer to the question of the use of laissez-faire in this time period cannot rest on Dicey’s assessment or the analysis of Bentham himself, but rather with proof of their impact on economic and social reforms. The idea of laissez-faire basically creates the core for his doctrine of morality, defining an act by it’s greatest possible happiness in it’s results. Many have argued that because of the popularity of Bentham and his teachings at the time, this would have a knock on impact to the use of laissez-faire. However the argument in definition has been made apparent. Bentham was utilitarian yet Benthamites were groups who came together in appreciation for Bentham, no necessarily to follow any lead into laissez-faire. Overall however, it would seem that this argument is only useful to a certain extent, as it tends to neglect fundamental evidence on the use of laissez-afire and its economic and social effects.

To conclude, the years between 1832 and 1870 certainly show clear signs of use of laissez-faire concepts, especially in economic factors. Free trade was to prove hugely positive for Britain’s economy, allowing the improvements in imports and exports. Even with competition issues in later years, the economic framework created by laissez-faire only encouraged further growth. However, a huge number of social issues contradict the ideals of laissez-faire. Poor Laws were passed in order to fight against the growing issue of poverty, aid was sent to Ireland after the great famine,and public health acts were passed to spur future reform. This line of social adjustment is strong evidence to show that 1832 to 1870 was not “the great age of laissez-faire”, but rather a struggle for the system to resist the urge to intervene.