On Over Manufacturing





284. One of the natural and almost inevitable consequences of

competition is the production of a supply much larger than the

demand requires. This result usually arises periodically; and it

is equally important, both to the masters and to the workmen, to

prevent its occurrence, or to foresee its arrival. In situations

where a great number of very small capitalists exist--where each

master works himself and is assisted by his own family, or by a

few journeymen--and where a variety of different articles is

produced, a curious system of compensation has arisen which in

some measure diminishes the extent to which fluctuations of wages

would otherwise reach. This is accomplished by a species of

middlemen or factors, persons possessing some capital, who,

whenever the price of any of the articles in which they deal is

greatly reduced, purchase it on their own account, in the hopes

of selling at a profit when the market is better. These persons,

in ordinary times, act as salesmen or agents, and make up

assortments of goods at the market price, for the use of the home

or foreign dealer. They possess large warehouses in which to make

up their orders, or keep in store articles purchased during

periods of depression; thus acting as a kind of flywheel in

equalizing the market price. 285. The effect of

over-manufacturing upon great establishments is different. When

an over supply has reduced prices, one of two events usually

occurs: the first is a diminished payment for labour; the other

is a diminution of the number of hours during which the labourers

work, together with a diminished rate of wages. In the former

case production continues to go on at its ordinary rate: in the

latter, the production itself being checked, the supply again

adjusts itself to the demand as soon as the stock on hand is

worked off, and prices then regain their former level. The latter

course appears, in the first instance, to be the best both for

masters and men; but there seems to be a difficulty in

accomplishing this, except where the trade is in few hands. In

fact, it is almost necessary, for its success, that there should

be a combination amongst the masters or amongst the men; or, what

is always far preferable to either, a mutual agreement for their

joint interests. Combination amongst the men is difficult, and is

always attended with the evils which arise from the ill-will

excited against any persons who, in the perfectly justifiable

exercise of their judgement, are disposed not to act with the

majority. The combination of the masters, on the other hand, is

unavailing, unless the whole body of them agree, for if any one

master can procure more labour for his money than the rest, he

will be able to undersell them.



286. If we look only at the interests of the consumer, the

case is different. When too large a supply has produced a great

reduction of price, it opens the consumption of the article to a

new class, and increases the consumption of those who previously

employed it: it is therefore against the interest of both these

parties that a return to the former price should occur. It is

also certain, that by the diminution of profit which the

manufacturer suffers from the diminished price, his ingenuity

will be additionally stimulated; that he will apply himself to

discover other and cheaper sources for the supply of his raw

material; that he will endeavour to contrive improved machinery

which shall manufacture it at a cheaper rate; or try to introduce

new arrangements into his factory, which shall render the economy

of it more perfect. In the event of his success, by any of these

courses or by their joint effects, a real and substantial good

will be produced. A larger portion of the public will receive

advantage from the use of the article, and they will procure it

at a lower price; and the manufacturer, though his profit on each

operation is reduced, will yet, by the more frequent returns on

the larger produce of his factory, find his real gain at the end

of the year, nearly the same as it was before; whilst the wages

of the workman will return to their level, and both the

manufacturer and the workman will find the demand less

fluctuating, from its being dependent on a larger number of

customers.



287. It would be highly interesting, if we could trace, even

approximately, through the history of any great manufacture, the

effects of gluts in producing improvements in machinery, or in

methods of working; and if we could shew what addition to the

annual quantity of goods previously manufactured, was produced by

each alteration. It would probably be found, that the increased

quantity manufactured by the same capital, when worked with the

new improvement, would produce nearly the same rate of profit as

other modes of investment.



Perhaps the manufacture of iron(1*) would furnish the best

illustration of this subject; because, by having the actual price

of pig and bar iron at the same place and at the same time, the

effect of a change in the value of currency, as well as several

other sources of irregularity, would be removed.



288. At the present moment, whilst the manufacturers of iron

are complaining of the ruinously low price of their produce, a

new mode of smelting iron is coming into use, which, if it

realizes the statement of the patentees, promises to reduce

greatly the cost of production.



The improvement consists in heating the air previously to

employing it for blowing the furnace. One of the results is, that

coal may be used instead of coke; and this, in its turn,

diminishes the quantity of limestone which is required for the

fusion of the iron stone.



The following statement by the proprietors of the patent is

extracted from Brewster's Journal, 1832, p. 349:



Comparative view of the quantity of materials required at the

Clyde iron works to smelt a ton of foundry pig-iron, and of the

quantity of foundry pig-iron smelted from each furnace weekly



Fuel in tons of 20 cwt each cwt 112 lbs; Iron-stone; Lime-stone

Cwt; Weekly produce in pig-iron Tons



1. With air not heated and coke; 7;3 1/4; 15; 45

2. With air heated and coke; 4 3/4; 3 1/4; 10; 60

3. With air heated and coals not coked; 2 1/4; 3 1/4; 7 1/2; 65



Notes. 1. To the coals stated in the second and third lines, must

be added 5 cwt of small coals, required to heat the air.



2. The expense of the apparatus for applying the heated air

will be from L200 to L300 per furnace.



3. No coals are now coked at the Clyde iron works; at all the

three furnaces the iron is smelted with coals.



4. The three furnaces are blown by a double-powered

steam-engine, with a steam cylinder 40 inches in diameter, and a

blowing cylinder 80 inches in diameter, which compresses the air

so as to carry 2 1/2 lbs per square inch. There are two tuyeres

to each furnace. The muzzles of the blowpipes are 3 inches in

diameter.



5. The air heated to upwards of 600 degrees of Fahrenheit.

It will melt lead at the distance of three inches from the

orifice through which it issues from the pipe.



289. The increased effect produced by thus heating the air is

by no means an obvious result; and an analysis of its action will

lead to some curious views respecting the future application of

machinery for blowing furnaces.



Every cubic foot of atmospheric air, driven into a furnace,

consists of two gases.(2*) about one-fifth being oxygen, and

four-fifths azote.



According to the present state of chemical knowledge, the

oxygen alone is effective in producing heat; and the operation of

blowing a furnace may be thus analysed.



1. The air is forced into the furnace in a condensed state,

and, immediately expanding, abstracts heat from the surrounding

bodies.



2. Being itself of moderate temperature, it would, even

without expansion, still require heat to raise it to the

temperature of the hot substances to which it is to be applied.



3. On coming into contact with the ignited substances in the

furnace, the oxygen unites with them, parting at the same moment

with a large portion of its latent heat, and forming compounds

which have less specific heat than their separate constituents.

Some of these pass up the chimney in a gaseous state, whilst

others remain in the form of melted slags, floating on the

surface of the iron, which is fused by the heat thus set at

liberty.



4. The effects of the azote are precisely similar to the

first and second of those above described; it seems to form no

combinations, and contributes nothing, in any stage, to augment

the heat.



The plan, therefore, of heating the air before driving it

into the furnace saves, obviously, the whole of that heat which

the fuel must have supplied in raising it from the temperature

of the external air up to that of 600 degrees Fahrenheit; thus

rendering the fire more intense, and the glassy slags more

fusible, and perhaps also more effectually decomposing the iron

ore. The same quantity of fuel, applied at once to the furnace,

would only prolong the duration of its heat, not augment its

intensity.



290. The circumstance of so large a portion of the air(3*)

driven into furnaces being not merely useless, but acting really

as a cooling, instead of a heating, cause, added to so great a

waste of mechanical power in condensing it, amounting, in fact,

to four-fifths of the whole, clearly shews the defects of the

present method, and the want of some better mode of exciting

combustion on a large scale. The following suggestions are thrown

out as likely to lead to valuable results, even though they

should prove ineffectual for their professed object.



291. The great difficulty appears to be to separate the

oxygen, which aids combustion, from the azote which impedes it.

If either of those gases becomes liquid at a lower pressure than

the other, and if those pressures are within the limits of our

present powers of compression, the object might be accomplished.



Let us assume, for example, that oxygen becomes liquid under

a pressure of 200 atmospheres, whilst azote requires a pressure

of 250. Then if atmospheric air be condensed to the two hundredth

part of its bulk, the oxygen will be found in a liquid state at

the bottom of the vessel in which the condensation is effected,

and the upper part of the vessel will contain only azote in the

state of gas. The oxygen, now liquefied, may be drawn off for the

supply of the furnace; but as it ought when used, to have a very

moderate degree of condensation, its expansive force may be

previously employed in working a small engine. The compressed

azote also in the upper part of the vessel, though useless for

combustion, may be employed as a source of power, and, by its

expansion, work another engine. By these means the mechanical

force exerted in the original compression would all be restored,

except that small part retained for forcing the pure oxygen into

the furnace, and the much larger part lost in the friction of the

apparatus.



292. The principal difficulty to be apprehended in these

operations is that of packing a working piston so as to bear the

pressure of 200 or 300 atmospheres: but this does not seem

insurmountable. It is possible also that the chemical combination

of the two gases which constitute common air may be effected by

such pressures: if this should be the case, it might offer a new

mode of manufacturing nitrous or nitric acids. The result of such

experiments might take another direction: if the condensation

were performed over liquids, it is possible that they might enter

into new chemical combinations. Thus, if air were highly

condensed in a vessel containing water, the latter might unite

with an additional dose of oxygen, (4*) which might afterwards

be easily disengaged for the use of the furnace.



293. A further cause of the uncertainty of the results of

such an experiment arises from the possibility that azote may

really contribute to the fusion of the mixed mass in the furnace,

though its mode of operating is at present unknown. An

examination of the nature of the gases issuing from the chimneys

of iron-foundries, might perhaps assist in clearing up this

point; and, in fact, if such enquiries were also instituted upon

the various products of all furnaces, we might expect the

elucidation of many points in the economy of the metallurgic art.



294. It is very possible also, that the action of oxygen in a

liquid state might be exceedingly corrosive, and that the

containing vessels must be lined with platinum or some other

substance of very difficult oxydation; and most probably new and

unexpected compounds would be formed at such pressures. In some

experiments made by Count Rumford in 1797, on the force of fired

gunpowder, he noticed a solid compound, which always appeared in

the gunbarrel when the ignited powder had no means of escaping;

and, in those cases, the gas which escaped on removing the

restraining pressure was usually inconsiderable.



295. If the liquefied gases are used, the form of the iron

furnace must probably be changed, and perhaps it may be necessary

to direct the flame from the ignited fuel upon the ore to be

fused, instead of mixing that ore with the fuel itself: by a

proper regulation of the blast, an oxygenating or a deoxygenating

flame might be procured; and from the intensity of the flame,

combined with its chemical agency, we might expect the most

refractory ore to be smelted, and that ultimately the metals at

present almost infusible, such as platinum, titanium, and others,

might be brought into common use, and thus effect a revolution in

the arts.



296. Supposing, on the occurrence of a glut, that new and

cheaper modes of producing are not discovered, and that the

production continues to exceed the demand, then it is apparent

that too much capital is employed in the trade; and after a time,

the diminished rate of profit will drive some of the

manufacturers to other occupations. What particular individuals

will leave it must depend on a variety of circumstances. Superior

industry and attention will enable some factories to make a

profit rather beyond the rest; superior capital in others will

enable them, without these advantages, to support competition

longer, even at a loss, with the hope of driving the smaller

capitalists out of the market, and then reimbursing themselves by

an advanced price. It is, however, better for all parties, that

this contest should not last long; and it is important, that no

artificial restraint should interfere to prevent it. An instance

of such restriction, and of its injurious effect, occurs at the

port of Newcastle, where a particular Act of Parliament requires

that every ship shall be loaded in its turn. The Committee of the

House of Commons, in their Report on the Coal Trade, state that,



'Under the regulations contained in this Act, if more ships

enter into the trade than can be profitablv employed in it, the

loss produced by detention in port, and waiting for a cargo.

which must consequently take place, instead of falling, as it

naturally would, upon particular ships, and forcing them from the

trade, is now divided evenly amongst them; and the loss thus

created is shared by the whole number.' Report, p. 6.



297. It is not pretended, in this short view, to trace out all

the effects or remedies of over-manufacturing; the subject is

difficult, and, unlike some of the questions already treated,

requires a combined view of the relative influence of many

concurring causes.



NOTES:



1. The average price per ton of pig iron, bar iron, and coal,

together with the price paid for labour at the works, for a long

series of years, would be very valuable, and I shall feel much

indebted to anyone who will favour me with it for any, even

short, period.



2. The accurate proportions are, by measure, oxygen 21, azote 79.



3. A similar reasoning may be applied to lamps. An Argand burner,

whether used for consuming oil or gas, admits almost an unlimited

quantity of air. It would deserve enquiry, whether a smaller

quantity might not produce greater light; and, possibly, a

different supply furnish more heat with the same expenditure of

fuel.



4. Deutoxide of hydrogen, the oxygenated water of Thenard.





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