SOCIALIST 1.

Robert Owen

Socialism arose in the late 18th and early Robert Owen was born in Newtown,
19th century as a reaction to the economic Montgomeryshire (Wales) on May 14, 1771,
and social changes associated with the the sixth of seven children. His father was a
Industrial Revolution. While rapid wealth saddler and ironmonger who also served as
came to the factory owners, the workers local postmaster; his mother came from one
became increasingly impoverished. of the prosperous farming families of
Newtown.
As this capitalist industrial system spread,
reactions in the form of socialist thought Owen attended the local school where he
increased proportionately. Although many developed a strong passion for reading. At
thinkers in the past expressed ideas that the age of ten he was sent to seek his
were similar to later socialism, the first fortune in London with his eldest brother,
theorist who may properly be called socialist William. After a few weeks, Owen found a
was François Noël Babeuf, who came to position in a large drapery business in
prominence during the French Revolution. Stamford (Lincolnshire) where he served as
Babeuf propounded the doctrine of class war an apprentice. After three years he returned
between capital and labor later to be seen in to London where he served under another
Marxism. draper. Then, in 1787 or 1788, he moved to
Manchester in the employ of Mr. Satterfield, a
wholesale and retail drapery merchant.

 Became one of England’s earliest

proponents of socialism and the co-
operative movement.
 Began an early career as a factory
manager and owner.
 KNOWN FOR: His creation of
cooperative communities at New
Lanark, Scotland, New Harmony,
Indiana, as well as later activism
The term ‘Socialism’ made its appearance in
 Owen now found himself in what
print in England in 1827. Five years later, the
would soon become the capital city
term was used for the first time in a French
of the English Industrial Revolution
publication. It is no accident that the socialist
on the eve of that event as factories
idea --and the socialist movement--first
were built and textile manufacture
appeared in England and France.
expanded.
For socialism was a product of two  He was serious, methodical young
man who already possessed an
revolutions in human affairs, each with their extensive knowledge of the retail
respective roots in those two countries: the aspect of his chosen trade.
industrial revolution in England and the  In late 1790 he borrowed £100 from
popular-democratic revolution in France. his brother William and set up
independently with a mechanic
named Jones as a manufacturer of
the new spinning mules.
 After a few months he parted with
Jones and started business on his
own with three mules as a cotton
spinner. During 1792, Owen applied
for and was appointed manager of
Peter Drinkwater’s new spinning
factory, the Piccadilly Mill, where he
Early Socialists quickly achieved the reputation as a
 spinner of fine yarns, thanks to the The profits from the company mill largely
application of steam power to the financed these efforts.
mule.

Politics and public opinion…

Owen proposed regulations to Parilament
to raise the minimum age of employment
and limit the working day, and also
proposed a system in which children
would have half-time education until age
12. His ideas deemed impossible, Owen
largely turned away from politics and
public policy and instead focused on
changing public opinion with the creation
of alternative communities
Owen suggested that the solution to
England’s economic problems at the
time lay in making the poor productive.
1. He advocated the formation of
New Lanark, Scotland Viewpoint in
“Villages of Cooperation” in which
early years: he asserted that human
800- 1,200 individuals would work
character is a product of
together in agriculture and
environment, and only by treating
factories to form one self-
workers humanely can they develop into
sustaining unity.
full, moral individuals.
2. Houses would be grouped to
Set out to transform the mills and the
share common living rooms and
community. Determined to both eliminate
child labor in the mills (so that children kitchens. Children would be boarded in a
could be educated) and to improve community school so that they could be
working conditions of all workers. best educated, and community gardens
would surround the school. On the
In essays from this period (1813-1825),
outskirts would lie the factory
he argued that the ideal moral
community would be a cooperatively-run 3. Most English policy makers and
agrarian and industrial village. thinkers of the time found these
communitarian proposals
So he enacted change:
idealistic and unrealistic
1. renovated workers’ homes so
Disgruntled, he fled to America
each had two stories
2. developed systems for sanitation
and garbage disposal Owen founded a settlement called New
Harmony in Indiana.
3. paved roads and implemented
street cleaning Believed he could enact his social vision
of the cooperative community.
4. opened a free village school
But, eight hundred settlers arrived in the Owenism is the utopian socialist
first weeks, long before any proper philosophy of 19th-century social
arrangements for their living or work reformer
assignments had been made, and chaos
ensued.
Robert Owen and his followers and
Dissatisfaction grew and in 1827 the
successors, who are known as Owenites.
community divided into smaller groups,
few of which ended up being viable. Owenism aimed for radical reform of
Owen began to face ideological conflict society and is considered a forerunner of
with his partners in the enterprise. the cooperative movement. The Owenite
movement undertook several
By 1828 it was clear New Harmony had
experiments in the establishment of
failed and Owen returned to Britain.
utopian communities organized
according to communitarian and
cooperative principles. One of the best
Back… Activism in England…
known of these efforts, which were
Owen returned to England in 1828 largely unsuccessful, was the project at
New Harmony, Indiana, which started in
He wrote and gave lectures that 1825 and was abandoned by 1829.
demonstrated a radical progression in his
thinking and vision. He now came out Owenism is also closely associated with
explicitly against private property, the development of the British trade
commercialism, and inequality in general. union movement, and with the spread of
the Mechanics' Institute movement.
The development of “Owenism” (the
ideas associated with Robert Owen) was
evolving and forced Owen to alter his
Cooperative Stores
approach
Cooperative stores and societies involve
- working-class trade unionists and other
consumer- owners of stores purchasing
activists transformed Owen’s vision of
goods in bulk at affordable prices for
alternative communities into more
the benefit of their members
immediate proposals for the improvement
of working class life. While many of these co-ops initially
failed, they inspired the successful
Thus three institutions of working class
British co- operative movement of the
“Owenism” emerged
second half of the 19th century (co-
1. the cooperative store operatively-owned stores still play a
significant role in the British economy).
2. the labor exchange
Labor Exchanges and the Labor
3. the trade union Exchange Theory
4. (These, esp. the labor exchange Workers not only wanted more affordable
theory, should be viewed as key goods, but also to reap the full benefits of
to his economic theories/beliefs) their labor. They developed proposals for
“equitable labor exchanges,” an idea
which Owen received enthusiastically.
The labor exchanges attempted to GNCTU, the GNCTU, closely
institutionalize “the labor theory of associated with Owen,
value,” the belief that the true value of a represented the first
good is based on the amount of labor manifestation of socialist-oriented
that it took to produce it, plus the cost of trade unionism.
the raw materials used to make it.
Thus, Robert Owen is known to this day
The labor exchanges were locations as one of the key figures in the founding
where individual cooperators or trade of British socialism
unionists (usually individual artisans)
exchanged goods without the use of
money, but with “labor notes,” which
represented a certain amount of hours-
worked.
Owen had previously suggested that
labor be made the standard of value,
and his followers followed suit.
However, by 1834, difficulties in keeping
the system insulated from the broader
market economy and emerging factory
production led to the eventual downfall of
labor exchange system.
Trade Unionism… Socialism
3. Charles Fourier
 At the same time (1825-35)  Charles Fourier was born in
Britain’s trade unions were Besancon, France, on 7th April,
fighting for shorter hours, the 1773. The son of a cloth
end of child labor, and safer merchant, he was educated at the
worker conditions local Jesuit College. After serving
 Owen had been the most the French Army he worked as a
visible reformer for these ideas clerk in Lyon. In 1808 he
in Britain, and so he eventually published his first book, The
became the most identifiable Social Destiny of Man.
leader of the Grand National  In the book Fourier criticized the
Consolidated Trade Union immorality of the business world,
(GNCTU), which within a few arguing that ‘truth and
weeks in 1834 grew to over half a commerce are as incompatible
million members. as Jesus and Satan.’ In the
 The workers and activists behind book Fourier advocated a new
trade unions transformed socialist system of
“Owenism” (the term then used cooperation.
for ideas associated with Robert  He suggested that ‘phalanxes’
Owen) into a critique of what should be established. These
trade unionists saw to be the would be scientifically planned to
unjust combination of wealth, offer a maximum of both
power and privilege in England. cooperation and self-fulfilment to
 Though the British government their members. Fourier suggested
would brutally repress the that these communes should
 contain about 1,600 people and attempt, was made by George Ripley at
should attempt to be compatible Brook Farm in Massachusetts (1841-46).
with each member’s ‘natural
Although no long-term phalanxes were
talents,
established, Fourier’s ideas influenced a
 passions, and inclinations’.
generation of socialists, anarchists,
feminists, pacifists, internationalists
He suggested that ‘phalanxes’ should be and others questioning the morality of
established. These would be scientifically the capitalist system. Even Karl Marx
planned to offer a maximum of both and Frederick Engels used Fourier’s
cooperation and self-fulfilment to their ideas to develop their theory of
members. Fourier suggested that these alienation. Fourier also published The
communes should contain about 1,600 New World of Communal Activity (1829)
people and should attempt to be and The False Division of Labour (1835).
compatible with each member’s ‘natural However, his attempts to find a rich
talents, benefactor to fund a phalanstery ended in
[Link] Fourier died in Paris on
passions, and inclinations’.
10th October, 1837.

 The phalange, in Fourier’s

The ideas in the book influenced writers conception, was to be a
such as Alexander Hearken, Peter cooperative agricultural
Larva, Pierre-Joseph Proudhon, Prince community bearing responsibility
Kropotkin, Ralph Waldo Emerson and for the social welfare of the
Henry David Thoreau. individual, characterized by
continual shifting of roles among
Others like Karl Marx and Frederick its members. He felt that
Engels accused Fourier of being phalanges would distribute wealth
‘utopian’ and attempted to develop a more equitably than under
more scientific theory of socialism. capitalism and
One of Fourier’s supporters, Victor  that they could be introduced into
Considerant, established a newspaper in any political system, including a
order to promote the cause. monarchy. The individual member
of a phalange was to be rewarded
Others attempted to establish their own on the basis of the total
phalanstery. This included one at productivity of the phalange.
Rambouillet in France that was under-  After inheriting his mother’s estate
capitalized and eventually went bankrupt in 1812, Fourier was able to
(1834-36). Another, more successful devote himself exclusively to
writing and refined his theoies in
 Traité de l’association agricole European Society (1814), and The
domestique (1822; ‘Treatise on New Christianity (1825).
Domestic Agricultural
 In his books Saint-Simon
Association’) and Le Nouveau
argued that Europe was in
Monde industriel (1829–30; ‘The
‘critical disequilibrium’ and
New Industrial World’).
would soon undergo
 His emphasis on adapting society
reconstruction. He argued
to human needs and on the
strongly for a planned
wastefulness of the competitive
economy.
capitalist system foreshadowed
 He suggested a framework of
the ideas of Karl Marx.
three chambers: one body
 \Cooperative settlements based
made up of engineers and
on Fourier’s ideas were started in
artists to propose plans, a
France and especially the U.S.,
second of scientists
among which the best known
 responsible for assessing
were the short-lived Brook Farm
the plans, and a third group
in Massachusetts (1841–46) and
of industrialists whose task
the North American Phalanx at
would be that of
Red Bank, N.J.
implementing the schemes
according to the interests
of the whole community.
4. Saint Simon
 After his death in 1825, Saint-
Simon’s ideas were developed
by a group of loyal followers
such as Olindes Rodriguez,
Armand Bazard and
Barthelemy- Prosper
Enfantin.
 In 1830 the group published
Saint-Simon, was born in Paris,
An Explanation of the
France, in 1760 as the son of a minor
Doctrine of Saint- Simon.
noble. Privately educated he served
The interpreted Saint-Simon
in the French Army during the
as being a socialist and
American War of Independence.
argued for the redistribution
Afterwards he travelled to Mexico and
of wealth for the benefit of
Spain where he became involved in
society. Saint-Simon’s
several canal projects. A supporter of
theories also influenced
the French Revolution, he
figures such as Alexander
immediately renounced his title. He
Herzen, Thomas Carlyle and
was imprisoned during the Terror but
J. S. Mill.
was released after spending nine-
 Saint-Simon’s earlier work
months in captivity. His first book on
was an attempt to establish a
political theory, Letters of a Genevan
scientific synthesis which
to His Contemporaries, was
might furnish mankind with a
published in 1802. This was followed
system of positive morality
by Introduction to the Work of
to take the place of religious
Science in the 19th Century (1807),
dogmas.
Memoir on the Science of Man
(1813), On the Reorganisation of
  It was to be a kind of “Let us Suppose”, says he, that
‘scientific breviary’ where all France suddenly loses fifty of her
phenomena could be deduced first-class doctors, fifty first class
from one single idea, that of chemists, fifty first-class
‘universal gravitation.’ He physiologists, fifty first-class bankers,
himself has treated us to a full two hundred of her best merchants,
account of this system, which six hundreds of her foremost
is as deceptive as it is simple, agriculturists, five hundred of her
and which shows us his most capable ironmasters, etc.
serious limitations as a (enumerating the Principal of industries).
philosopher whose ambition
 Seeing that these men are its
far outran his knowledge.
most indispensable producers,
 Auguste Comte, one of his
makers of its most important
disciples, attempted a similar
products, the minute that it loses
task in his Cours de
these the nation will degenerate
Philosophic positive and in the
into a mere soulless body and fall
Politique positive, so that
into a state of despicable
Saint-Simon, who is usually
weakness in the eyes of rival
considered the father of
nations and will remain in the
socialism, finds himself also
subordinate position so long as
the father of positivism.
the loss remains and their places
are vacant.
 From the above parable it is clear
that the official Government is a
mere facade. Its action is wholly
superficial. Society might exist
without it and life would be none
the less happy. But the
disappearance of the servants,
industrial leaders, bankers and
merchants would leave the
community crippled.
 The very sources of wealth would
dry up, for their activities are
The following points highlight the top really fruitful and necessary.
three economic ideas of Saint Simon. They are the true governors who
The economic ideas are: wield real power. Such was the
1. St. Simon’s Parable parable. St. Simon wanted to
reform the social organization, he
2. Industrial Order wanted to create an industrial
society.
3. Industrial Government.
Economic Idea # 1. St. Simon’s
Parable: Economic Idea # 2. Industrial Order:
St. Simon’s leading ideas, contained To provide equality and opportunity
within the compass of a few striking the society was to be organized.
pages, have since become known as
“Saint-Simon’s Parable”.
The main feature of industrialism was
that the material resources of the country
would be fully utilised. The main citizens
of the country would be Industrials –
manufacturers, scientists, engineers,
workers, agriculturists, artists, bankers,  This novel concept of government
etc. distinguished St. Simon’s
industrialism from economic
St. Simon stressed the point in new liberalism.
social order that private property should  To him, the main function of the
be abolished but there should not be any government was not the
class distinctions. He divided the society provision of justice and
in to two classes – national party defense as is done by the
comprising industrials and anti-national modern governments, but the
party preparation of public
 works, provision for the
comprising idlers. He wanted the latter to
defense of industrials, and that
disappear.
of employment so that it might
carry out the enterprises of
Industrial development and
Economic Idea # 3. Industrial
national prosperity.
Government:
 St. Simon was not a socialist but
To Saint Simon, the function of the a collectivist. He never proposed
government would be limited to the abolition of private property.
“defending workers from the unproductive He wanted knowledge and
sluggard and maintaining security and industry to govern social order,
freedom for the producer. based on universal association.
 On the one hand, he wanted
Therefore, to maintain peace in a factory, collectivism and on the other, he
he thought, that it could even be defended private property. His
undertaken by men of secondary level. industrialism and collectivism
“France was to be turned into a greatly influenced French writers
factory and the nation organized on like G. Sorrel, Louis Blanc and
the model of a vast workshop”, which Anton Menger. His industrial
would not require any government. society was intended to secure
the greatest advantage for the
Under the new system the aim must be greatest number.
to combine all the forces of society in
such a fashion as to secure the
successful execution of all these works
which tend to improve the lot of its
members either morally or physically.
The factory would be run by the
government, the executive power would
be in the hands of a chamber of deputies
recruited from the representatives of
commerce, industry, manufacture and
agriculture.
 2. Overproduction
3. Class Conflict
4. Population
5. Machinery
4. Sismondi 6. Distribution
7. Capital
8. Competition
9. Peasant Farming
10. Reform Projects.
Economic Idea # 1. Aim and Method of
Political Economy

 Sismondi accepted the theoretical

principles of Adam Smith but
strongly criticised the aim,
method and end of economics as
put by classical [Link]
Jean Charles Leonard de Sismondi was
classical economists believed
born in May 1773, whose real name was
that political economy was the
Simonde, was a writer born at Geneva.
science of wealth or
He is best known for his works on French
chrematistics. Sismondi felt that
and Italian history, and his economic
economics was not the science
ideas. His father and all his ancestors
of wealth but its main object was
seem to have borne the name Simonde,
man or the physical well-being of
at least from the time when they
man.
migrated from Dauphine to Switzerland at
 To classical economists, it is the
the revocation of the edict of Nantes. It
increment of wealth which spells
was not till after Sismondi had become
the well-being of the society and
an author that, observing the identity of
its [Link] Sismondi points
his family arms with those of the once
out that the object really is to
flourishing Pisan house of the Sismondi
increase happiness of the
and finding that some members of that
members of the society. He
house had migrated to France, he
advocated the way of increasing
assumed the connection without further
human happiness. He gave
proof and called himself Sismondi.
importance to distribution more
than the theory of production.

The following points highlight the top

ten economic ideas of Sismondi. The
 With regard to the method of
economic ideas are:
economic analysis, Sismondi was
1. Aim and Method of Political in favor of studying economics by
Economy historical method of seeing every
 fact in relation to its social Sismondi believed that over-
environment. production was mainly due to
 He disapproved the abstract
generalization of Ricardo and Say
but he considered Adam Smith (1) The competitive character of the
and Malthus sufficiently historical economy.
and realistic in their methods.
 For him the study of economics (2) Production is determined by the
was to be based on experience, supply of capital and not by
history and observation of the demand and the separation of
social setting, because it was “a labour and ownership of means of
moral science where all facts are production.
interwoven and where a false step Economic Idea # 3. Class Conflict
is taken whenever a single fact is
isolated and attention
concentrated upon it alone”.
 Through his theory of over-
Economic Idea # 2. Overproduction production and crisis, Sismondi
was able to lay his finger on the
basic conflict of interest between
 The classical economic theory different classes.
had established an automatic  Sismondi did not believe in
equilibrium between production harmony of social interests. He
and demand. was one of the early economists
 Over-production was considered to speak the existence of two
by classical economists as social classes, the rich and the
indicative of general prosperity. poor, the capitalists and the
But Sismondi believed it to be a workers.
great evil caused by  He thought the interests of these
maladjustment. He could not two classes were opposed to
assume automatic equilibrium as each other and they were in
it was unrealistic. Sismondi did constant conflict with one another.
not believe in Say’s law of  The workers are not able to share
markets or the deductive method the fruits of increased productivity.
of Ricardo in which there was no The profits go to the
possibility of over-production. businessmen in the form of
 According to Sismondi, over- profits. Thus the gulf between the
production resulted when annual rich and the poor keeps on
production was in excess of widening.
annual revenue. He said that  It may be pointed out that, “Marx’s
even if prices fell, production idea that labor alone created
would continue. He condemned value, and that consequently
over-production as it created profit and interest constituted a
unemployment, reduced the theft, is entirely foreign to
purchasing power of people, Sismondi.”
and caused an acute distress Economic Idea # 4. Population
Sismondi wanted population to be in such Economic Idea # 6. Distribution
proportion to wealth as would ensure the
Sismondi strongly criticised the
maximum human welfare. He never
distribution theory of Ricardo. He said
suggested a large population. He
that the end as postulated by the then
believed that affection which created an
economists, the largest possible
urge for marriage, and egoism and
production, did not necessarily coincide
calculation that place a check on the
with the end to which all activities should
growth of numbers were the two forces
be desired.
that determined the size of the
population by their interplay. He also The end was the achievement of greatest
pointed out that the laborer's did not possible happiness of the people which
marry unless they were employed with could be attained even with a small
an assured earning. production which was well distributed.
Thus, Sismondi emphasised the need for
Since the poor were exploited and their
proper distribution.
wages could not be fixed permanently,
they do not wait, get married and Sismondi recognised the existence of
multiply beyond the natural limit. three classes of society – landed
Sismondi disapproved the Malthusian proprietors,capitalists and day labourers.
theory of Population. He criticized the They could receive for their services rent,
arithmetical and geometrical ratios of profits and wages respectively. Sismondi
Malthus saying that the latter contrasted made an illogical distinction between the
with reality. According to him, it was the annual revenue and annual production
inability to get work and not the means of and explained that the revenue of the
subsistence that limited the rise of preceding year was spent on the
population. purchase of the annual production. He
wanted an equilibrium between
production and consumption and
Economic Idea # 5. Machinery effective laws for the regulation of
distribution in the interests of the
community.
The classical writers considered the
introduction of machinery beneficial
because it increases production and as a Economic Idea # 7. Capital
result, prices fall, demand for goods
Sismondi considered that a capitalist
increases, which in turn means an
industry was necessary for the material
increased demand for labour and
happiness of the people. But he opposed
expansion of employment.
concentration of wealth in the hands of a
Thus workers thrown out of the work at few. Everybody should be enabled to
the time of the introduction of machinery enjoy capital. He admitted that the
will now find work. Sismondi was against nation’s capital was amassed by the
inventions and machines because they capitalists and their hirelings and the
lead to evil consequences. His view was proletariat was left to suffer. He gave a
that the introduction of machinery comprehensive exposition of the law of
reduces consumption and slackens capital concentration which led to
demand. pauperism; and the separation of
property from toil created evil
consequences.
 the right of forming trade unions, there
should be legal limitation on working
Economic Idea # 8. Competition
hours and guarantee of holidays and
restrictions on the employment of

Sismondi criticised the classical view that children.

competition, in general, was beneficial to
The employers should be made legally
the people. Competition is useful only
responsible for “Professional Guarantee”,
when it provokes the producers to
a system of insurance for workers,
increase production in response to an
including unemployment, accident,
increase in demand. With stationary
sickness and old age benefits.
consumption, competition means race
among the producers for increasing The financial burden was to fall wholly on
sales by lowering prices. the employers and not on the public
Prices can be lowered by reducing costs exchequer. The rapid multiplication of
and in their bid to reduce costs, the invention was opposed by Sismondi
producers are inclined to cut wages and because he feared that it created
to employ children and women workers unemployment and economic crisis. He
and to lengthen the working hours. also opposed mechanised production
and the large scale production.

Economic Idea # 9. Peasant Farming

Utopian Socialism

Sismondi was of the view that the

benefits accruing from farming should go
to the peasants alone. He praised the
efforts of the French peasants to
improve the standard of cultivation after
their lands had been freed from the
feudal lords. Sismondi favoured a small
scale cultivator who could cultivate his
land according to his choices and skill
and enjoy the full benefits of his labour
and industry.

Economic Idea # 10. Reform Projects:

Sismondi’s aim was to lay down the
abuses of the capitalist system in actual
life and to demonstrate the necessity of
state intervention.
He thus became the first of the
interventionists. He advocated state
intervention to correct the immediate
evils of the wage system and worker’s
misery. Workers should be guaranteed