The larger aggregate of wages, which must be paid under an eight hours day, will increase the expanses of production in each industry.  For the increased wage cannot in general be obtained by reducing profits, for any such reduction will drive freshly-accumulated capital more and more to seek foreign investments, and managing ability will in some measure tend to follow it.  The higher aggregate of wages must therefore be represented in a general rise of prices.  This rise of prices will have two effects.  In the first place it will tend to largely negative the higher aggregate of money wages.  Or if organized labour, free from the competition of unemployed, is able to maintain a higher rate of real wages, the general rise in prices will enable foreign producers to undersell us in our own market (unless we adopted a Protective Tariff), and will disable us from competing in foreign markets.  This constitutes the pith of the economic objection raised against an eight hours day.  The eight hours advocates meet the objection in the following ways—­ First, they deny that prices will rise in consequence of the increased aggregate of wages.  A reduction in interest and in wages of superintendence will take place in many branches of industry, without any appreciable tendency to diminish the application of capital, or to drive it out of the country.

Secondly, the result of an increased expenditure in wages will be to crush the small factories and workshops, which are the backbone of the sweating System, and to assist the industrial evolution which makes in favour of large well-organized factories working with the newest machinery.

Thirdly, it is claimed that we shall not be ousted either from our own or from foreign markets by foreign competition, because the eight hours movement in England must be regarded as part of a larger industrial movement which is proceeding pari passu among the competing nations.  If the wages of German, French, and American workers are advancing at the same rate as English wages, or if other industrial restrictions in those countries are otherwise increasing the expenses of production at a corresponding rate, the argument of foreign competition falls to the ground.

These leading arguments of the advocates of an eight hours day are of very unequal value.  The first argument is really based upon the supposition that the increased aggregate of wages can be “got out of capital” by lowering interest and profits.  The general validity of this argument may be questioned.  In its application a distinction must be drawn between those businesses which by means of the possession of some monopoly, patent, or other trade advantage are screened from the full force of competition, and are thus enabled to earn profits above the average, and those businesses where the constant stress of close competition keeps interest and profits down to the lowest point which suffices to induce the continued application of capital and organizing ability.  In the former cases the “cost” of an Eight Hours Day might be got out of capital, assuming an effective organization of labour, in the latter cases it could not.