Reply - working-class share ownership

John Harrison asked LHL: was working-class share ownership more widely advocated by national organisations from 1860 onwards? Though a relatively difficult question to give a definitive answer to, what we can do is divide the answer into a few areas where we may make some small contributions.

Firstly, we can take a little peek at John’s own area of specialisation, the cooperative movement, and colour in what might be self-evident. Though staunchly opposed to any political allegiance from the outset, the cooperative movement would, by its very nature and interest in self-help, encourage acquiescence and participation in the capitalist system. Initially, an overview of nineteenth century Friendly Societies and Mutual Improvement Societies provides the reader with what Christopher J. Prom called, ‘an earnest striving [on behalf of workers] after respectability and political legitamacy’. In other words, a powerful means by which working-class men and women adapted to and accepted a system of liberal capitalism. As Alan Fowler pointed out in Lancashire Cotton Operatives and Work, 1900-1950, ‘Those families with insufficient surplus to pay into a holiday savings club would rely on their annual dividend from the local co-op to fund some entertainment during wakes week’.

Founded in Rochdale in 1844 the cooperative movement grew quickly and by 1863 it had created the Cooperative Wholesale Society. Providing quality foodstuffs and funeral service and importantly the notorious financial ‘divi’, the ‘Coop’ grew exponentially. Like most aspects of general history though, local histories provide us with much more detail and complexity. In Burnley alone, 70% of the town were members of the Cooperative by 1906. In Preston, in 1900, the Independent Labour Party (ILP) would fail to acquire one seat on the local cooperative board and complain that ‘this is a very slow old Conservative town’. Nevertheless, it is Eric Hopkins in Working-Class Self-Help in Nineteenth-Century England, who informs that initial efforts were made by Christian Socialists, such as J.M. Ludlow and Thomas Hughes, to encourage producers’ cooperative groupings from 1850 onwards. However, all of these endeavours had collapsed by 1854. G. D. H. Cole draws our attention to the fact that 163 producers’ cooperatives were registered under the Industrial and Provident Societies acts, 1862-1880 and that in 1872 mining enterprises in Newcastle, Leeds, Ecceshall and Darlington were recorded, wherein workers shared in company profits. Perhaps the most notorious area of working class share-holding though was in Oldham where, in the market boom of 1873-1875, a large proportion of mills developed into ‘Working Class Limited’s’. The Sun Mill at Chadderton being possibly the most well-known and from 1858-1896, 154 ‘Limiteds’ sprung up in Oldham. Ultimately, reoccurring trade depression and a lack of support from trade unions found a Royal Commission Report listing only 114 such societies in 1903. G. D. H.Cole claiming most of these were small scale enterprises located in the East Midlands shoe and boot industry. As Geoffrey Trodd noted the problem for socialists was that the Coop, ‘far from representing an alternative system of society provided integration into the existing economy’.

However, the crux of John’s question is, was workers share ownership advocated by national organisations? We know that in 1867, William Gladstone notoriously described the working-class has, ‘an association of small capitalists’, but with hindsight we can safely dismiss this as political hot air. If we look at two of the most prominent trade union organisations of prominence in Lancashire, the Amalgamated Weavers Union (AWA) and the Lancashire and Cheshire Miners Federation (LCMF) we can extrapolate that neither union was socialist in outlook and like so many other nineteenth century trade unions, they were deeply conservative and limited in political forays outside that of their own trades. The trade union leaders reflect all too well this compliance. J.T. Fielding in Bolton and David Holmes in Burnley lived privileged lifestyles, constantly attacked socialist initiatives and had no intention of overtly rocking the capitalist boat in which they sat. They may well have privately approved of, ‘workers improving their station’, but evidence is scant to their lack of support for share-holding. Both the AWA history by Edwin Hopwood and a LCMF PhD thesis I have unearthed by Ian Frederick Scott, record no share encouragement records whatsoever.

Finally, we have utilised some of our own LHL volunteers to help answer John’s query. John Morrison provides us with a little information about the ‘rent and room’ system which existed in Lancs and could be said to be one of the forerunners to share-holding. John said, the ‘Rent and room' system did not refer specifically to individual weavers or groups of weavers setting up some kind of cooperative. It was a much more general term to describe the system of weaving enterprises renting premises and looms rather than buying them. This certainly facilitated many start-ups in the 19th century, many of which went on to purchase their own mills. However, some quite large-scale businesses operating hundreds of looms remained on a 'rent and room' basis.

The Harle Syke district [in Burnley] was notable for its weaving firms encouraging its operatives to buy shares in their companies. These firms paid lower wages than the county price lists but tended to cooperate to share out orders between the various mills. They were also anti-union and the Amalgamated Weavers' Association wasn't allowed to organise there until after the First World War. The deal for the operatives seemed to be a loss of some wages and union membership rights in return for some guarantee of regular work - and the opportunity to buy shares in the business which of course bound them ever closer to the mill owners. The Harle Syke district was a constant thorn in the side of the AWA, the mills there usually operating during county strikes, not least in the more-looms disputes of the early thirties.

In the inter-war period, share ownership by weaving operatives fell into some disrepute since some mill owners, desperately trying to reduce costs, imposed shares in lieu of an element of wages or forced their employees to buy shares in the business as an alternative to closure and redundancy.

To conclude, there may well have been some national organisational support for workers’ shareholding initiatives but LHL have found little evidence in a cursory overview of Lancashire. In addition, the rent and room system existed alongside the cooperative movement and therefore we recognise that elements of self-help philosophy existed amongst the weavers, if but often a limited and local phenomenon. John K. Walton in A Social History of Lancashire reminds and reinforces that by the 1880’s there was a proliferation of the rent and room system in Burnley and Nelson, making the area the last major spawning ground of so called ‘self-made’ cotton manufacturers. However, Walton concludes though, that the cotton industry was not a conduit for business success for the ordinary cotton operatives at all….. and in fact that ‘It was a convenient myth; but a myth it was, all the same’.

Peter John Fyles and John Morrison