The political economy of Peterloo

Today is the 200th anniversary of what has come to be called the Peterloo massacre.  On 16 August 1819, 60,000 working people gathered at St Peter’s Field in Manchester England to demonstrate for the right to vote, against the terrible conditions and pay of factory workers and for the right to organise at the workplace, among a host of other injustices.

Peterloo has become a marker in the labour history of Britain. The peaceful demonstration was brutally attacked and dispersed by a private militia of thugs on horseback funded and directed by the local landlords and authorities with the tacit backing of the then Tory government under Lord Liverpool. An estimated 18 people, including a woman and a child, died from sabre cuts and trampling. Over 700 received serious injuries.

I am not going to discuss the event or the politics behind it as there are many thorough and better accounts to be had elsewhere.  Indeed, there is a film by leading British filmmaker, Mike Leigh on the day.

Instead, I want to comment on the economics of Peterloo: the state of the British economy and capitalism at the time  – to provide some context to the event and also perhaps draw out some wide generalisations.

Peterloo took place a few years after the end of so-called Napoleonic wars in which the aristocratic monarchies of Britain, Austria, Russia and Germany finally defeated the French republic.  The end of the war heralded a period of deep depression in European economies, as soldiers returned home without work and bad harvests and weather led to a sharp downturn in agricultural production – still the dominant form of economic activity in early 19th century Europe.

This period of depression started before the end of war in 1812 and continued for ten years to 1822. It is reckoned that England suffered more economically, socially and politically, than during the French wars when at least there were good harvests and armaments production provided work. During the wars, Britain’s export and re-export trade increased. British ships carried the world’s trade and also captured French colonies which further increased Britain’s trade potential. After 1815 this virtual monopoly ended and trade declined

The depression brought discontent and distress and a response from the growing layers of industrial workers in the ‘dark satanic mills’ of the new big cities of Manchester, Liverpool and Birmingham that had no parliamentary representation or civic rights.  The 18th century constitution remained, with the landlord class in control and forming the government.

In 1815 parliament passed the Corn Laws, enforcing higher prices for grain to protect landlord profits from cheaper foreign imports, squeezing the wages of workers and the profits of the industrial capitalists.  Classical bourgeois economist, David Ricardo wrote his Principles of Political Economy and Taxation in 1817 that presented a theoretical argument against agricultural rents and the corn laws.  Indeed, Ricardo led the demand in parliament for an inquiry into the Peterloo massacre.

Wages were held down by the so-called Speenhamland system, which subsidised wages from the public purse somewhat like the Universal Basic Income proposed now.  At the same time, the demobilisation of 300,000 soldiers, the influx of 100,000 Irish labourers and the use of children and women in the factories meant that the ‘reserve army of labour’ (to use Marx’s phrase) was huge.  Indeed, the population in the industrial areas was rocketing (up 50% in the first 30 years of the 19th century).

At the same time, any attempt by rural workers to feed themselves off the land was blocked and curtailed by the landowners.  The 1816 Game Laws allowed landowners to hunt for game; but not their workers.  The penalty for poaching was seven years transportation to Australia.  Common land had been wiped out by the enclosure measures decades before.

Decade Enclosures
1780-90 287
1790-1800 506
1800-1810 906

The war had driven up the public debt to £834 million. Interest on this was a heavy burden to taxpayers. But the answer of the government was to end income tax, thus shifting the burden of servicing the debt onto the poorest through various sales and customs taxes.  The interest paid on the debt went to the rich war bond holders now no longer paying income tax.  The government tried to inflate away the debt burden by staying off the gold standard and letting the pound devalue, driving up inflation and hitting the poor again.

Radical poet Lord Byron protested in the House of Lords about the situation in 1812 “I have been in some of the most oppressed provinces of Turkey; but never, under the most despotic of infidel governments, did I behold such squalid wretchedness as I have seen since my return, in the very heart of a Christian country”.

All this was compounded by the weather.  The year 1816 is now known as the ‘Year Without a Summer’ because of severe climate abnormalities that caused average global temperatures to decrease by 0.4–0.7 °C. This resulted in major food shortages across the Northern Hemisphere. Evidence suggests that the anomaly was predominantly a volcanic winter event caused by the massive 1815 eruption of Mount Tambora in the Dutch East Indies (now Indonesia). This eruption was the largest eruption in at least 1,300 years.

The Year Without a Summer was an agricultural disaster. Low temperatures and heavy rains resulted in failed harvests in Britain and Ireland. Families in Wales travelled long distances begging for food. Famine was prevalent in north and southwest Ireland, following the failure of wheat, oat, and potato harvests. In Germany, the crisis was severe; food prices rose sharply. With the cause of the problems unknown, people demonstrated in front of grain markets and bakeries, and later riots, arson, and looting took place in many European cities. It was the worst famine of 19th-century Europe.

Indeed, The Year Without a Summer is a misnomer; it was Years Without a Summer given the weather of 1816, 1817, and 1818.  Lord Byron, now in permanent exile, was moved to write an apocalyptic poem, The death of the sun, while staying by the banks of Lake Geneva in July 1816 as Europe and North America were gripped by one of the coldest summers on record.

“I had a dream, which was not all a dream. The bright sun was extinguish’d, and the stars Did wander darkling in the eternal space, Rayless, and pathless, and the icy earth, Swung blind and blackening in the moonless air; Morn came and went—and came, and brought no day, And men forgot their passions in the dread Of this their desolation.”

It is also no accident that Mary Shelley, the partner of Percy Shelley, went on to write Frankenstein in 1818. Shelley’s miserable Creature is usually portrayed as the terrible result of uncontrolled technology.  But in the context of the climate shock, it is also a figure representing the desperate refugees crowding Switzerland’s market towns in that year. Eyewitness accounts frequently refer to how hunger and persecution “turned men into beasts”, how fear of famine and disease-carrying refugees drove middle-class citizens to demonize these suffering masses as subhuman parasites and turn them away in horror and disgust.

Peterloo happened because the British government in this depression was the most reactionary.  There was a fear of the democratic ideas of the French Revolution spreading.  There was a lasting fear of popular movements, which reflected the fear of revolution. There was a determination to protect and defend the landed interest – the basis of the government’s political power. There was a general dislike of an organised police-force, so a consequent heavy reliance on the military and private militias meant that in any confrontation, made violence the preferred option. The government kept the Combination Acts on Statute Books until 1824, which suppressed all reform movements. This was a government of the landed few for the landed few.

The 18th century economist Adam Smith noted the imbalance in the rights of workers in regards to owners (or “masters”). In The Wealth of NationsBook I, chapter 8, Smith wrote: “We rarely hear, it has been said, of the combination of masters, though frequently of those of workmen. But whoever imagines, upon this account, that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labor above their actual rate[.]  When workers combine, masters … never cease to call aloud for the assistance of the civil magistrate, and the rigorous execution of those laws which have been enacted with so much severity against the combination of servants, labourers and journeymen.”

This was also the period of the so-called Luddites, a radical group of weavers who reacted to the introduction of machinery and their loss of jobs with attacks on the machines themselves.

In this light, the Peterloo massacre was the inevitable waiting to happen.  After the event, the great radical romantic poet, Percy Shelley graphically attacked the government and its ruling class in his famous poem, Masque of Anarchy, the final verse of which is echoed in the current campaign slogan of the British leftist Labour party:

‘Rise like Lions after slumber
In unvanquishable number –
Shake your chains to earth like dew
Which in sleep had fallen on you –
Ye are many – they are few.’

At a more general level, Peterloo took place in the same year as the very first capitalist-style crisis and financial crash. The Panic of 1819 started in the US and was triggered by the post-Napoleonic depression in Europe which led to the collapse of US export markets and the bankruptcy of several banks that had made export loans.  The ensuing recession lasted until 1821. The boom and bust cycle that has characterised capitalist accumulation to this day had begun.

This was the first capitalist slump – and also the first recognisable period of depression in modern industrial capitalism.  In my book, The Long Depression, I suggest that capitalist accumulation takes place in cycles of profitability.  There are periods of rising profitability and then periods of falling profitability (within the longer-term context of a secular fall as capitalist economies mature).

There are four seasons each of approximately 10-14 years in the 19th century (they are longer in the 20th century).The first season (Spring) sees a rise in profitability as new technology and an expanding workforce is applied.  In the second season (Summer), profitability falls and because labour has got stronger during the spring season, the class battle intensifies.  Then comes Autumn, a new period of rising profitability built on the defeat of previous labour struggles and the weakening of labour through slumps.  Finally, profitability falls again in the Winter season and there is a depression that can only be broken either by war or by successive slumps that eventually restore profitability for a new Spring.

1819 was a year right in the middle of such a Winter.  The weakening of labour in the previous Autumn of the war economy from 1800-1812 had seen profitability rise for both landowners and rising industrial capitalists.  But the post-war depression was one of falling profitability (as noted by Ricardo) in which the dominant landowning class tried to preserve its profits and hegemony at the expense of industry and labour through repression and taxation.  Peterloo was the marker for this.

After 1822, England entered a new Spring based on industrial expansion and the revival of export markets in Europe.  The industrial bourgeois mobilised its workers to fight for the vote in the cities and parliamentary representation (for property owners).  The Reform Act was passed in 1832.

SPRING 1776-86: profitability up; industrialisation begins, labour strengthens, first trade unions

SUMMER 1786-1800: profitability down; Marx’s law operates, labour fights

AUTUMN 1800-12: profitability up; war economy; labour weakened and overseas

WINTER 1812-22: profitability down; post-war depression, labour repressed

10 thoughts on “The political economy of Peterloo

  1. It was not just working people that assembled in St. Peter’s Fields. The main demands being raised for voting rights and electoral reform were bourgeois demands, and were being raised by bourgeois radicals. The main speaker Henry “Orator” Hunt, was himself a prosperous capitalist farmer. At the time less than 3% of the population had the vote, mostly wealthy landowners. The majority of the bourgeoisie did not have the vote, and where they did in the places where they were most concentrated in the large urban areas there were either no MP’s, or very fee MP’s in relation to the population, whereas in rural areas, small population elected several MP’s, and in half the cases, the wealthy landowner in the area was entitled to simply nominate who the MP would be.

    As Marx points out, at this time, the working-class did not fight its own immediate enemy, the bourgeoisie, but the enemy of its enemy, the landed aristocracy. The mobilisation at St. Peter’s Fields reflected that combining large numbers of workers – many actually not wage workers, but themselves independent producers still using their own means of production, such as the hand-loom weavers – but also sizeable numbers of urban bourgeois, including mill owners, and other factory owners. William Ridgeway, the large pottery manufacturer from Stoke, for example, went to the rally, which was also supported by bourgeois newspapers such as the Times.

    After the massacre, Ridgeway called a large meeting in Stoke in support of those that had been massacred, and to condemn the dragoons that had been sent in by the local magistrates, who were the instrument of the local landed gentry. Peterloo was part of the unfolding bourgeois political revolution of the time, which led to the 1832 Reform Act, which gave the vote to a larger swathe of the bourgeoisie, but not to workers, and which got rid of the rotten boroughs, which were one of the main ways the landed aristocracy had kept the bourgeoisie from exercising political power.

    As Marx and Engels say, even as late as 1848, the working-class was still acting in alliance with the industrial bourgeois against the landed aristocracy, as they joined forces to bring about the Repeal of the Corn Laws.

    Indeed, once the industrial bourgeoisie had defeated not just the landed aristocracy, but also the financial oligarchy that was associated with them, then as Engels says, the industrial bourgeoisie understood that they could only maintain themselves in power with the support of the working-class. As marx sets out in the 18th Brumaire, that is the basis of social-democracy. Engels points out that as the Liberals emerge as the party of the industrial bourgeoisie, so the Liberals dragged the industrial proletariat along with it, as a long tail, and manifest in the trades union support for the Liberals, and the election of Lib-Lab MP’s.

    Its only when the bourgeoisie had consolidated themselves in power, and incorporated the workers via social democracy, that workers themselves were given the vote.

    1. “It was not just working people that assembled in St. Peter’s Fields. The main demands being raised for voting rights and electoral reform were bourgeois demands, and were being raised by bourgeois radicals.”

      So says Boffy, in his never ending quest to prove the “progressive” nature of capitalism, and a coincident rational enlightened bourgeoisie,

      The careful reader will note how Boffy offers no supporting statements for his initial claim, that it was not just working people assembled, but immediately shifts to the demands raised as being “bourgeois demands” raised by “bourgeois radicals,” as if the content of the demands was identical with participation in the demonstrations.

      History is filled with instances where the initial demands and programs are clearly non-revolutionary in content, but where beneath that verbiage there is working class struggle and ferment. That doesn’t make the struggle inherently, eternally or any other -ly a struggle of the bourgeoisie. One only has to look at the revolutionary struggles of 1848-1849 to find an example, or if the 20th century is more appealing, try 1905 in Russia, with its bourgeois demands, or try the struggle in Bolivia in 1954..

      Marx, and Engels, in their critiques of the revolutions of 1848-49 pointed out how the “alliance” with the “democratic” bourgeoisie was a recipe for the failure of those revolutions, but Boffy isn’t having any of that.

      Boffy would have us believe that the lesson of Louis Napoleon is that the industrial bourgeoisie could only maintain power with the support of the working class, when in fact the lessons of the 18th Brumaire, and the Class Struggle in France 1848-1850, and Germany: Revolution and Counterrevolution, were that the bourgeoisie, industrial, financial, commercial would always, and necessarily withdraw from revolutionary struggle, accommodate the resurgence of reaction, actively work for the defeat of the revolution once the sanctity of private property was jeopardized; a lesson proven again, and in blood, after the US Civil War, with the retreat of the US bourgeoisie from Radical Reconstruction, the accommodation of the Southern “redemptionist” forces by the bourgeoisie, and the abandonment of the freed men and women to the Southern terrorists intent on restoring bondage in a different form.

      1. We have a modern mass movement for “the right to vote, against the terrible conditions and pay of [factory] workers and for the right to organise at the workplace” — Hong Kong. The banners are bourgeois democratic, the participants are mostly workers, and the deep push that poured two million into the streets comes from the terrible conditions in HK. The PRC has had 22 years to show HK working people that a bright future is ahead — and done nothing.

  2. China and the capitalistic periphery is still in a economic spring or summer. The developed economies reached another winter: Since 1970, labor productivity growth per hour worked has fallen from over 4% a year to zero percent in 2018 in Germany.
    The DIW tries to explain the decreasing productivity growth of the whole economy with the relative increase of less productive sectors. That’s a symptom, but no explanation.

    1. I don’t know how you measure that from 1970, given the fact that Germany was divided east and west, but anyway, using 2010 as the index year (2010 =100), Eurostat reports real labor productivity per capita in Germany has moved from 84.3 in 1991 to 106 in 2018.

      As for the capitalist periphery still experiencing a spring or summer…. really? Egypt, Libya, Tunisia, Algeria, Sudan, South Africa, Argentina, South Korea, Brazil, Venezuela, Jamaica, Guatemala, El Salvador, Honduras, Angola, Mozambique “still in economic spring or summer”?

      And China, reporting increased levels of unemployment; India, with slowing growth, and both countries with about 90% of the combined population living on $10/day or less? That’s springtime?

      1. Apparently you did not understand the graphics of the DIW. It is not about absolute growth, but about the decline in the growth rate. An absolute increase in productivity has taken place, but at an increasingly slow pace. Source in English:

        As for the other countries, the possibility of productivity growth is still high across the periphery, simply because they can increasingly use the technology that exists in the world. In developed capitalism, however, less and less new technology emerges – despite the chatter of AI.
        On earth “winter” is a regional matter.
        Wal Buchenberg, Hannover

      2. Apparently I don’t understand how you derive a figure of 4% a year for a single year (1970) and call that a trend. Nor do I understand how you compare Germany 1970 to Germany 1991 and beyond. Eurostat doesn’t understand how you do that either, but whatever….

        If you do look at the Eurostat numbers for real labor productivity per person, Germany from 1991, the period from 1991-2000 has an average annual rate of growth of around .95 percent; 2001-2010 rate drops to below .5% per annum; 2011-2018 is above .5% per year.

        Regarding other countries use of technology, try looking at the growth rates in Latin America, Sub-Saharan Africa.

        This, however……

        “As for the other countries, the possibility of productivity growth is still high across the periphery, simply because they can increasingly use the technology that exists in the world. In developed capitalism, however, less and less new technology emerges – ”

        is nonsense, and self-contradictory– developed capitalism produces less and less new technology, but developing countries can increasingly use the technology that exists in the world? Where does that technology that the “periphery” uses
        come from? Outer space?

        The advances in the less developed countries are based on combining cheaper labor supplies with existing technologies, and in many cases, technologies that were obsolete in the advanced countries. For example, it was in the 2002 that China bought, dismantled, shipped, the Thyssen Krupp plant of Dortmund Germany that had been targeted for closure as unprofitable (

        Technology does not outweigh the social configuration , and the ongoing overproduction will synchronize the season between core and periphery. .

      3. Germany of 1970 is West Germany. East Germany was “occupied” by the West and integrated into capitalism. The development in Germany from 1970 to 2017 is not unbroken, but still shows a clear trend: Productivity growth is slowing down. Meaning: The “energy of capitalism” (investment in new technology) is flagging.
        The technology that develops in periphery countries is mostly created by exporting capital from developed countries. The capital follows the higher rates of profit. Productivity growth is the other side of capital growth. This explains why productivity has grown faster in the developing countries of recent decades than in the core capitalist zone.
        In the core zone, productivity growth and industrial capital growth are almost at a standstill.

  3. I’ve given a more detailed account of the political history surrounding Peterloo in my post Peterloo, which also has links to other historical data.

    The role of the hand-loom weavers is interesting. There were around 400,000 hand loom weavers in Britain, around 40,000 of them in Manchester alone. These were independent commodity producers using their own means of production, i.e. petit-bourgeois. They had done well during the Napoleonic Wars due to the demand for cloth for uniforms etc. But, the introduction by capitalist producers of machines, and particularly the power loom, meant the hand loom weavers could not compete.

    Marx points out in Capital I, the extent to which they had to sell their output below its value, and only dragged on in existence because of a reliance on welfare payments from Parish Relief. The hand loom weavers, were later to form a significant element amongst the “physical force Chartists” that emerged to demand votes for workers, after they had been denied that right in the 1832 Reform Act. Indeed, as Engels points out in his history of the Communist League, and its predecessors such as the League of the Just, the majority of those involved in the early socialist political organisations were, in fact, petit-bourgeois craft workers, and perhaps necessarily so, because they were the most educated, and only trades union organised sections of workers.

    But, they failed to achieve that, and instead as Engels points out, it was rather then further development of industrial capitalism, and of the social-democracy that arose upon it, which created the basis for the incorporation of the workers in that social-democratic regime. Indeed, it is the same development that led to the development of “New Unionism”, in which for the first time the semi-skilled and unskilled workers became unionised, and formed the basis for the development of large social-democratic parties based upon them.

    As Engels put it,

    This “turned the English working class, politically, into the tail of the ‘great Liberal Party’, the party led by the manufacturers. This advantage, once gained, had to be perpetuated. And the manufacturing capitalists, from the Chartist opposition, not to Free Trade, but to the transformation of Free Trade into the one vital national question, had learnt, and were learning more and more, that the middle class can never obtain full social and political power over the nation except by the help of the working class.”

    (Preface to The Second German Edition of The Condition of the Working Class in England)

    And that meant, says Engels that,

    “Thus a gradual change came over the relations between both classes. The Factory Acts, once the bugbear of all manufacturers, were not only willingly submitted to, but their expansion into acts regulating almost all trades was tolerated. Trades Unions, hitherto considered inventions of the devil himself, were now petted and patronised as perfectly legitimate institutions, and as useful means of spreading sound economical doctrines amongst the workers. Even strikes, than which nothing had been more nefarious up to 1848, were now gradually found out to be occasionally very useful, especially when provoked by the masters themselves, at their own time. Of the legal enactments, placing the workman at a lower level or at a disadvantage with regard to the master, at least the most revolting were repealed. And, practically, that horrid People’s Charter actually became the political programme of the very manufacturers who had opposed it to the last. The Abolition of the Property Qualification and Vote by Ballot are now the law of the land. The Reform Acts of 1867 and 1884 make a near approach to universal suffrage, at least such as it now exists in Germany; the Redistribution Bill now before Parliament creates equal electoral districts-on the whole not more unequal than those of France or Germany; payment of members, and shorter, if not actually annual Parliaments, are visibly looming in the distance and yet there are people who say that Chartism is dead.”


  4. The anti combination act that tried to suppress workers combing together and forming stronger unions … taking wages out of competition. The workers movement against the anti combination laws took a while but it advanced and “won”, although contingently. In around 1800 the sailors of the British imperial fleet joined this struggle and struck, ie mutinied, one of the biggest acts of defiant combination in British history.

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