THE FIRST POVERTY ENLIGHTENMENT

The incidence of poverty had clearly been increasing for some time in Britain and much of Europe in the latter part of the eighteenth century, due mainly to falling real wages (Allen, 2007; Tucker, 1975).

The masses started to question longstanding excuses for the deprivations they faced. Of course, there had been sporadic propoor protest movements before. For example, there was the (short-lived) “Levellers” movement for suffrage and religious tolerance in mid-seventeenth-century England, during the Civil War period (Hill, 1972). But the late eighteenth century saw both new thinking and more widespread demands for change across Britain, Europe, and America. Popular politics flourished in the cafes and alehouses ofLondon, Paris, and elsewhere in Europe in the late eighteenth century.^[412] The historian Brinton (1934, p. 281) identifies the “essential characteristic” of the change in ideas in the last decade of the eighteenth century in Europe as the transition from the view that “... life on this earth is a fleeting transition to eternity, that such life is inevitably one of misery” to.. an assertion of the possibility of the harmonious satisfaction here on earth of what are assumed to be normal human appetites.” There was a new mass awareness of the scope for economic and political institutions to serve the material needs of all people.

The three words that best capture the spirit of the period are “liberte, egalite, fraternite” (liberty, equality, fraternity)—the motto of the French Revolution (and adopted as France’s national motto in the late nineteenth century). Although the first few decades after the French Revolution hardly lived up to these lofty words, and the suffrage that emerged was largely confined to men with property, there can be little doubt that the underlying ideas had lasting impact. “Liberty” was understood in a way consistent with modern usage (as in, say, Rawls, 1971), in that the individual was deemed to have whatever freedoms were consistent with like freedoms for others. “Equality” was not, however, understood as equality of outcomes but was defined in terms of legal rights of opportunity—that the law must be the same for everyone and so allow all citizens equal opportunity for public positions and jobs, with the assignment determined by ability. There was little immediate sign of a perceived role for the state in redistribution of rewards, although some calls for this did start to emerge in the 1790s with the left-wing Jacobin Club and (in particular) Francois-Noel (Gracchus) Babeuf.^{[413] [414]} However, if there was hope for poor people in the mainstream ideas of “liberte, egalite, fraternite,” then it was more in “fraternity” than “equality”; as Brinton (1934, p. 283) explains:

Fraternity had meant to the hopeful eighteenth century the outpouring of its favorite virtue, benevolence, upon all human beings, and especially on the downtrodden and the distant— on peasants, Chinamen and South Sea Islanders.

Similar views were being heard in America where advocates of a strong state role in fight­ing poverty saw this as an essential element of what it meant to be “a great friendly society” (AlexanderEverett, 1827, quoted by Klebaner, 1964, p. 394).

New philosophical and economic thinking from the mid-eighteenth century had opened the way to this Poverty Enlightenment in the last few decades of that century. Significant cracks had started to appear in mainstream views about the role of the state in influencing the distribution of wealth. A key step in this philosophical thinking was the rejection of the view that prevailing inequalities were inevitable. The social contract approach that emerged in the seventeenth century (often attributed to Thomas Hobbes) asked a fundamental question: How should we decide what constitutes good govern­ment? In modern terms, this is a question of evaluation, and the relevant counterfactual was a “natural state” in the absence of government. Like all counterfactuals, the natural state was unknown and open to debate.^[415] Hobbes argued that it would be a state of con­flict, of “all against all.” The question was taken up again in the late eighteenth century by Rousseau, who opened up an important new strain of thinking about the distributive role ofthe state. In his Discourse on the Origin of Inequality, Rousseau argued that, although self­interest was a motivation in the natural state, so, too, was empathy for the situation of others.^[416] Human institutions, however, can develop to either support or thwart our nat­ural empathy. Rousseau thus saw poverty and inequality as stemming in no small measure (though not solely) from bad institutions—social arrangements that created “... different privileges, which some men enjoy to the prejudice of others, such as that of being more rich, more honored, more powerful or even in a position to exact obedience.” Here Rousseau made a key step in recognizing the role played by institutions, including gov­ernments, in influencing distribution.^[417] Poverty was not then inevitable.

Prominent philosophical writings called for respect for poor people as fellow citizens. Kant (1785, p. 62) put forward the idea that every rational human being must be treated “as an end withal, never as means.” This was indeed a radical idea, which gave poor peo­ple the same moral worth as rich people. Of course there was some measure of respect for poor people even in (say) de Mandeville’s earlier writings, but it was a respect for their labor, consistent with the role assigned to them by their birth. They were merely the means to an end. In Kant, by contrast, there was respect for all rational agents, whatever their economic circumstances. This was an essential step for both political equality and comprehensive antipoverty policy, although both were still a long way off.

A longstanding view—often attributed to Cicero in ancient Rome—distinguished justice from beneficence, with only the former entailing a role for the state (Fleischacker, 2004, Chapter 1). Local religious organizations had long been charged with the beneficence role. One crack was opened up by Kant. Theologies have long applauded charity as virtuous. Kant questioned this, arguing that there was an inherently unequal relationship between giver and receiver in charity for poor people; therefore, Kant questioned whether it was “virtuous” to give alms that flatter the giver’s pride:

Kant sees moral corruption in the private relationships by which well-off people bestow of their bounty to the needy and looks to the state to provide for a more respectful relationship between rich and poor.

Fleischacker (2004, p. 71).

Such challenges to established thinking about beneficence paved the way for much public debate in Europe and America about the role of the state in fighting poverty and in dis­tribution more broadly, and an eventual shift of responsibilities from religious organiza­tions to the state.

Economic thinking was also advancing. Smith (1776) lambasted the mercantilist view that a country’s economic welfare was to be judged by the balance of trade.

Smith saw the virtue of self-interest—though he did not see it as the sole motive for human behavior (Smith, 1759, Chapter 1,1.I.1)—but only in so far as it advanced social welfare, which depended crucially on the institutional context. And gone was the “utility of poverty,” with its negatively sloped individual supply function.^[420] Despite the popular characterizations of Smith’s noninterventionist views in the twentieth century (Rothschild, 2001), he argued in favor of promotional antipoverty policies, such as lim­ited public subsidies to help cover tuition fees for the basic schooling of the “common people” (Smith, 1776, Book 5, Chapter I, Article 2d). However, on this and other social issues, Smith was evidently far more progressive than most of his peers. (Note that Smith was writing at roughly the same time as other thinkers such as Joseph Townsend.)

The changes in popular and scholarly thinking around this time came with implica­tions for ongoing policy debates relevant to income distribution. One such debate was on whether income taxes should be progressive and whose incomes should be taxed.^[421] The milieu gave impetus to arguments for redistributive taxation. Smith had strongly favored exempting subsistence wages, as did others subsequently, including those who favored proportional taxes above the exemption—implying a progressive tax system overall.

Anotherpolicy debate concerned the distribution of the gains from natural resources, notably agricultural land. In a pamphlet (addressed to government of the new French Republic, but with broader relevance), Paine (1797) argued that agricultural land was “natural property,” to which every person had a legitimate claim. There was, nonethe­less, an efficiency case for its private ownership. So instead of being nationalized, agrarian land should be subject to taxation—a “ground rent,” the revenue from which should be allocated equally to all adults in society, as all have a claim to that property. (He also made provision for an additional old-age pension.) And this was (explicitly) not to be seen as charity but as a right. Paine’s proposal was a comprehensive antipoverty policy; indeed, it appears to have been the first “basic income scheme”—an idea we return to in Section 22.9, but which has not yet seen national implementation in any country.

An important prelude to the eventual emergence of promotional policies came with new thinking on the importance of schooling: “Illiteracy had become a stigma instead of an ordinary accompaniment of humble life” (Brinton, 1934, p. 279). Condorcet, the late eighteenth-century French philosopher and mathematician, advocated free universal basic education (though warning against the state instructing on moral or political matters, as he greatly valued diversity in views); Condorcet also advocated equal rights for women and all races (Jones, 2004). However, these were still radical ideas, well ahead of imple­mentation. The classical economists who came to dominate thinking about policy in the nineteenth century also saw education as having the potential to make economic growth more poverty-reducing, notably by attenuating population growth through “moral improvement.” But they did not see mass education as having a role in promoting that growth and saw little scope for mass public education (Blaug, 1962, p. 216).

An important contribution of the First Poverty Enlightenment was in establishing the moral case for the idea of public effort toward eliminating poverty. That moral case developed out of a new respect for hard-working poor people, as people, on the part of the elites—what de Waal (2009, p. 116) calls “emotional identification.” Important new progressive ideas emerged in the writings of Smith, Rousseau, Kant, Fichte, Condorcet, Babeuf, and others. However, we were still a long way from the three pre­mises identified in the introduction. Although the First Poverty Enlightenment brought about new thinking relevant to antipoverty policies, it did not mark any dramatic change in the lives of the poor, and they were still being blamed for their poverty; the belief that poor people were to blame for their own poverty persisted into the nineteenth and twen­tieth centuries.^{[422] [423] Except for relief under the Poor Laws in England and Wales, neither private assistance nor public support for poor people showed any marked rise in Europe, from their relatively low levels (Lindert, 2013). The main economic beneficiaries ofthe First Poverty Enlightenment were probably in the middle class, who could now aspire to sources of wealth and power they had previously been excluded from.}

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22.5.