John Gray (1799 – 26 April 1883) was a British newspaper proprietor and economist. His first published work, A Lecture on Human Happiness, was broadly supportive of the ideas of Robert Owen, although he would later criticise Owen's communitarianism. Gray's critique of laissez-faire capitalism is usually associated with the school of Ricardian socialism and he was one of the earliest writers to advocate a centrally-planned economy.
Biography Early life Gray was born in Derbyshire and attended Repton School. He was, by his own admission, a poor scholar, who spent most of his time fishing, climbing trees and playing marbles, and his final school report described him as "possessing abilities, rising barely to mediocrity".Gray, John, The Social System (Edinburgh, 1831) p. 338)
He left school at fourteen and was employed by a wholesale and manufacturing company in Cheapside, London.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) His job took him all over London and the conditions that he witnessed convinced him that there was something wrong with the way that the economy functioned. He later wrote, "I saw clearly that goods of every description are made either because they are ordered, or because there is every prospect of their being so; and continued reflection satisfied me that this state of things ought to be reversed,— that production, instead of being the effect of demand, ought to be the cause of it".Gray, John, The Social System (Edinburgh, 1831) pp. 339-340)
After reading Adam Smith's The Wealth of Nations, Gray wrote a manuscript called The National Commercial System, but friends persuaded him that it was poorly written and should not be published. At his brother's suggestion he started to read the writings of Robert Owen and soon realised that their views coincided.Gray, John, The Social System. Edinburgh, 1831) pp. viii and 340 His revised thoughts were published in a pamphlet, A Lecture on Human Happiness (1825).
A Lecture on Human Happiness Gray's Lecture contained some of the key tenets of both Owenism and what would later be called Ricardian socialism. His starting point was that humans are by nature social creatures, imbued with a desire for happiness. This desire can only be achieved when basic human wants are satisfied, and the fact that there is so much misery in the world proves that society is constructed upon the wrong principles.Beer, Max, A History of British Socialism. George Allen and Unwin, 1919) pp. 212-213Claeys, Gregory, Machinery, Money and the Millennium (Princeton University Press, 1987, pp. 111-112
He said that the entire wealth of the country was created by productive labour, which he defined as "labouring people, employed in agriculture mines and minerals; artisans, handicrafts, mechanics and labourers employed in manufactories, buildings, and works of every kind".Gray, John, A Lecture on Human Happiness (London, 1825) p. 29 He regarded everyone else as unproductive and therefore a direct tax on the productive classes. Furthermore, those who failed to give an equivalent for what they consumed were, he said, useless members of society.Gray, John, A Lecture on Human Happiness (London, 1825) p. 15
Using statistical evidence from Patrick Colquhoun's Treatise on the Wealth, Power and Resources of the British Empire (1814), Gray analysed how much every section of society contributed to the wealth of the nation and compared that to their actual income.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) To this he added comments, based primarily on his own moral judgements, about the utilitarian value of each occupation to society as a whole. For example, he dismissed the labour of servants as useless, because the only beneficiaries of their work were their wealthy employers.Claeys, Gregory, Machinery, Money and the Millennium (Princeton University Press, 1987, p. 114
The productive classes, Gray calculated, only received about one-fifth of the wealth that they created, the other four-fifths being taken from them by rent, interest and capitalist profits. The root cause of this, he argued, was underconsumption. He said that production should only be limited by either the satisfaction of all the wants of society, or the exhaustion of its productive powers. Capitalist competition, however, introduced an artificial barrier to production, limiting it to "demand", which was measured by the amount that could be sold at a profit. This led to job losses and wage cuts, so that labourers could not afford to buy the goods that they needed.Claeys, Gregory, Machinery, Money and the Millennium (Princeton University Press, 1987, pp. 116-117Gray, John, A Lecture on Human Happiness (London, 1825) pp. 60-67
Although he disassociated himself from Owenite views on the formation of character, Gray praised Owen's economic ideas, which he said would abolish the artificial limit of production and give producers the wealth they create.Gray, John, A Lecture on Human Happiness (London, 1825) p. 56 He supported the formation of co-operative communities, where competitive exchange would not exist,Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) and added an annex to his pamphlet containing the Articles of Association for the formation of such a community, drawn up by the London Co-operative Society. Due to production problems, the pamphlet had only limited distribution in Britain, but sold well in the United States and has been credited with influencing the development of socialist ideas in both countries.Foxwell, H. S., Introduction to Menger, Anton, The Right to the Whole Produce of Labour, (London, 1899) p. xlviii
Edinburgh In 1825 Gray moved to Edinburgh, Scotland, intending to join the community which was being set up by Abram Combe at Orbiston, near Motherwell. He bought shares in the Orbiston Company,The Law Times, Volume 7, (London, 1846) p. 106 but following a brief visit to Orbiston, during which he had been alarmed by what he saw as a lack of management planning, he decided against becoming a community member.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) In his pamphlet A Word of Advice to the Orbistonians (1826) he warned that too many activities were being undertaken by people who lacked the necessary skills to carry them out and that unless a skilled workforce and a professional manager were brought in the project was doomed to failure.Garnett, R. G., Co-operation and the Owenite socialist communities in Britain 1825-45 (Manchester University Press, 1972) pp. 92-93Gray, John, The Social System (Edinburgh, 1831) pp. 341-351 These criticisms, however, would not prevent Gray from writing a generous tribute to Combe after his early death.Gray, John, The Social System (Edinburgh, 1831) pp. 351-354)
Gray remained in Edinburgh, where he founded a free newspaper consisting entirely of advertisements, The Edinburgh and Leith Advertiser.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) Unfortunately for Gray, the publication of advertisements soon became liable to Stamp Duty, so, in partnership with his brother James, he converted the Advertiser into a regular newspaper, with James as editor.Gray, John, The Social System (Edinburgh, 1831) pp. 367-368) This survived for fifty-three editions, after which the brothers reverted to the purely advertising format with The Edinburgh, Leith, Glasgow and North British Advertiser and later The North British Advertiser).Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004)'GRAY, J[ames] & J[ohn] newspaper printers Edinburgh,' and several subsequent entries; Scottish Book Trade Index. National Library of Scotland website at:
Gray went through difficult times over the next few years. In 1829 he suffered a mental breakdown, from which his brother helped to nurse him back to health;'GRAY, J[ames] & J[ohn] newspaper printers Edinburgh,' and several subsequent entries; Scottish Book Trade Index. National Library of Scotland website at: in 1830 he was briefly imprisoned for debt, following the failure of his project to establish a printers' hall where businesses could share modern machinery;Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) and in 1831 his wife, Caroline, died.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) The North British Advertiser, however, would eventually make Gray a very wealthy man.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004)
The Social System His next publication, The Social System: a Treatise on the Principle of Exchange, appeared in 1831. Although Gray wrote that his views were "substantially the same as those which I entertained many years ago",Gray, John, The Social System (Edinburgh, 1831) p.6 his criticisms of Owenism were more sharply expressed than in his Lecture on Human Happiness.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004)Claeys, Gregory, Machinery, Money and the Millennium (Princeton University Press, 1987, pp. 118-120 He strongly objected to Owen's policy of equal distribution of property,Gray, John, The Social System (Edinburgh, 1831) p. 371 and dismissed as delusional the Owenite belief that a person's character had to be improved before they could become wealthy.Gray, John, The Social System (Edinburgh, 1831) p. 374 Although he still believed in the concept of co-operation, it was not in any communitarian sense, but "merely a thoroughly organized plan of producing, exchanging and distributing the wealth of this country".Gray, John, The Social System (Edinburgh, 1831) p. 341
The Social System was one of the earliest attempts to articulate a centrally-planned economy.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004) Gray's plan involved the creation of a National Chamber of Commerce (NCC), which would exercise complete control over the cultivation, manufacture and distribution of food and all other goods. Produce and manufactured goods would be deposited in national warehouses for onward supply to retail shops and the warehouse and shop managers would all be employed by the NCC. Wages and prices would be determined by the NCC, which would also be able to increase or limit production of any items, depending on whether there were too many or too few of them being produced. The system was voluntary and owners of land and capital who opted in would be compensated by a fixed annual fee. There would be no competition over the employment of capital but Gray's system allowed for labourers who produced more or better quality goods to be paid extra.Thompson, Noel, 'Gray, John (c.1799–1883)', Oxford Dictionary of National Biography, (Oxford University Press, 2004)Claeys, Gregory, Machinery, Money and the Millennium (Princeton University Press, 1987, pp. 120-121; 124 The value of goods would be based on labour time (given a financial value by averaging wages paid over the last few years), plus cost of materials and overheads such as rent, interest, salaries of NCC managers, replacement of stock and other capital investment.Thompson, Noel, The Market and its Critics (Routledge, 1988) pp. 105-108