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The Corn Laws were trade laws designed to protect cereal producers in the United Kingdom of Great Britain and Ireland against competition from less expensive foreign imports between 1815 and 1846. More simply, to ensure that British landowners reaped all the financial profits from farming, the corn laws (which imposed steep import duties) made it too expensive for anyone to import grain from other countries, even when the people of Great Britain and Ireland needed the food (as in times of famine).
The laws were introduced by the Importation Act 1815 (55 Geo. 3 c. 26) and repealed by the Importation Act 1846 (9 & 10 Vict. c. 22). These laws are often considered as examples of British mercantilism.
The economic issue, in essence, was food prices; the price of grain was central to the price of the most important food staple, bread, and the working man spent much of his wages on bread.
The political issue was a dispute between landowners (a long-established class, who were heavily represented in Parliament) and the new class of manufacturers and industrialists (who were not): the former desired to maximise their profits from agriculture, by keeping the price at which they could sell their grain high; the latter wished to maximise their profits from manufacture, by reducing the wages they paid to their factory workers -- the difficulty being that men could not work in the factories if a factory wage was not enough to feed them and their families; hence, in practice, high grain prices kept factory wages high also.
During 1813, a House of Commons Committee recommended excluding foreign-grown corn until the price of corn grown domestically increased to 80 shillings (£4) (2010 equivalent: £202.25) per quarter (1 quarter = 480 lb / 218.8 kg). The political economist Thomas Malthus believed this to be a fair price, and that it would be dangerous for Britain to rely on imported corn because lower prices would reduce labourers' wages, and manufacturers would lose out due to the decrease of purchasing power of landlords and farmers. Nevertheless, 80 shillings a quarter was so high a price that domestic grain never attained it between 1815 and 1848. David Ricardo, however, believed in free trade, so that Britain could use its capital and population to its comparative advantage. With the advent of peace during 1814, corn prices decreased, and the Tory government of Lord Liverpool passed the 1815 Corn Law to keep bread prices high. This resulted in serious rioting in London.
During 1820 the Merchants' Petition, written by Thomas Tooke, was presented to the House of Commons demanding free trade and an end to protective tariffs. The Prime Minister, Lord Liverpool, who (falsely) claimed to be in favour of free trade, blocked the Petition; he argued, speciously, that complicated restrictions made it difficult to repeal protectionist laws. He added, though, that he believed Britain's economic dominance grew in spite of, not because of, the protectionist system. During 1821 the President of the Board of Trade, William Huskisson, composed a Commons Committee report which recommended a return to the "practically free" trade of the pre-1815 years. The Importation Act 1822 decreed that corn could be imported when the price of domestically harvested corn increased to 80 shillings per quarter but imported corn was prohibited when the price decreased to 70 shillings per quarter. After the passing of this Act until 1828 the corn price never increased to 80 shillings. During 1827 the landlords rejected Huskisson's proposals for a sliding scale and during the next year Huskisson and the new Prime Minister, the Duke of Wellington, devised a new sliding scale for the Importation of Corn Act 1828 whereby when domestic corn was 52 shillings per quarter or less, the duty would be 34 shillings, 8 pence and when the price increased to 73 shillings the duty decreased to 1 shilling.
The Whig governments in power for most of the years 1830–41 decided not to repeal the Corn Laws. However the Liberal Whig MP Charles Pelham Villiers proposed motions for repeal in the House of Commons annually from 1837 to 1845. During 1842 the majority against repeal was 303, by 1845 this had decreased to 132. The first year that Robert Peel voted in favour was 1846, though he had spoken in favour of repeal during 1845 but voted against it. During 1853, when Villiers was made a privy counsellor the Times stated "it was Mr Charles Villiers who practically originated the Free Trade movement".
During 1838 Villiers spoke to a meeting of 5,000 "working class men" in Manchester. At the time, he proclaimed that the presence of so many of them demonstrated that he had their approval. During 1840 the Committee on Import Duties directed by Villiers published a blue book examining the effects of the Corn Laws. Tens of thousands of copies were printed in pamphlet form by the Anti-Corn Law League, the report was quoted in the major newspapers, reprinted in America and published in an abridged form by The Spectator.
During 1841 Sir Robert Peel became Conservative Prime Minister and Richard Cobden, a major proponent of free trade, was elected for the first time. Peel had studied the works of Adam Smith, David Hume and Ricardo and proclaimed during 1839: "I have read all that has been written by the gravest authorities on political economy on the subject of rent, wages, taxes, tithes". However he voted against repeal every year from 1837 to 1845. During 1842 in response to the blue book published by Villiers' 1840 Committee on Import Duties, Peel gave the concession of modifying the sliding scale by reducing the maximum duty to 20 shillings when the price decreased to 51 shillings or less. Peel's acolyte Monckton Milne MP said of Villiers at the time of this concession during 1842 that he was "the solitary Robinson Crusoe sitting on the rock of Corn Law repeal".
The landlords claimed that manufacturers like Cobden wanted cheap food so they could decrease wages and thus maximise their profits, an opinion shared by the socialist Chartists. Karl Marx said: "The campaign for the abolition of the Corn Laws had begun and the workers' help was needed. The advocates of repeal therefore promised, not only a Big Loaf (which was to be doubled in size) but also the passing of the Ten Hours Bill" (i.e. to reduce working hours).
The Anti-Corn Law League, initiated during 1838, was agitating peacefully for repeal. They funded writers like William Cooke Taylor to travel the manufacturing regions of northern England to research their cause. Taylor published a number of books as an Anti-Corn Law propagandist, most notably, The Natural History of Society (1841), Notes of a tour in the manufacturing districts of Lancashire (1842), and Factories and the Factory System (1844). Cobden and the rest of the Anti-Corn Law League believed in the view that cheap food meant greater real wages and Cobden praised a speech by a working man who said:
When provisions are high, the people have so much to pay for them that they have little or nothing left to buy clothes with; and when they have little to buy clothes with, there are few clothes sold; and when there are few clothes sold, there are too many to sell, they are very cheap; and when they are very cheap, there cannot be much paid for making them: and that, consequently, the manufacturing working man's wages are reduced, the mills are shut up, business is ruined, and general distress is spread through the country. But when, as now, the working man has the said 25s. left in his pocket, he buys more clothing with it (ay, and other articles of comfort too), and that increases the demand for them, and the greater the demand...makes them rise in price, and the rising price enables the working man to get higher wages and the masters better profits. This, therefore, is the way I prove that high provisions make lower wages, and cheap provisions make higher wages.
The magazine The Economist was initiated during September 1843 by politician James Wilson with help from the Anti-Corn Law League; his son-in-law Walter Bagehot later became the editor of this newspaper.
During February 1844, the Duke of Richmond initiated the Central Agricultural Protection Society (CAPS, commonly known as the "Anti-League") to campaign in favour of the Corn Laws.
During 1844, the agitation subsided as there were fruitful harvests. The situation changed during late 1845 with poor harvests and the Great Famine in Ireland; Britain experienced scarcity and Ireland starvation. Peel argued in Cabinet that tariffs on grain should be rescinded by Order in Council until Parliament assembled to repeal the Corn Laws. His colleagues resisted this. Soon afterwards the Whig leader Lord John Russell declared in favour of repeal. On 4 December 1845 an announcement appeared in The Times that the government had decided to recall Parliament during January 1846 to repeal the Corn Laws. Lord Stanley resigned from the Cabinet in protest. The next day Peel resigned as Prime Minister because he did not believe he could implement his policy and so the Queen sent for Russell to form a government. Russell offered Cobden the post of Vice-President of the Board of Trade but he refused, preferring to remain an advocate of free trade outside the government. By 20 December Russell was unable to form a ministry and so Peel remained Prime Minister.
After Parliament was recalled the CAPS started a campaign of resistance. In the rural counties the CAPS was practically supplanting the local Conservative associations and in many areas the independent free holding farmers were resisting the most fiercely.
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On 27 January 1846, Peel gave a three-hour speech saying that the Corn Laws would be abolished on 1 February 1849 after three years of gradual reductions of the tariff, leaving only a 1 shilling duty per quarter. Benjamin Disraeli and Lord George Bentinck emerged as the most forceful opponents of repeal in Parliamentary debates, arguing that repeal would weaken landowners socially and politically and therefore destroy the "territorial constitution" of Britain by empowering commercial interests.
On the third reading of Peel's Bill of Repeal (Importation Act 1846) on 15 May, MPs voted 327 votes to 229 (a majority of 98) to repeal the Corn Laws. On 25 June the Duke of Wellington persuaded the House of Lords to pass it. On that same night Peel's Irish Coercion Bill was defeated in the Commons by 292 to 219 by "a combination of Whigs, Radicals, and Tory protectionists". On 29 June Peel resigned as Prime Minister and in his resignation speech he attributed the success of repeal to Cobden:
In reference to our proposing these measures, I have no wish to rob any person of the credit which is justly due to him for them. But I may say that neither the gentlemen sitting on the benches opposite, nor myself, nor the gentlemen sitting round me—- I say that neither of us are the parties who are strictly entitled to the merit. There has been a combination of parties, and that combination of parties together with the influence of the Government, has led to the ultimate success of the measures. But, Sir, there is a name which ought to be associated with the success of these measures: it is not the name of the noble Lord, the member for London, neither is it my name. Sir, the name which ought to be, and which will be associated with the success of these measures is the name of a man who, acting, I believe, from pure and disinterested motives, has advocated their cause with untiring energy, and by appeals to reason, expressed by an eloquence, the more to be admired because it was unaffected and unadorned—the name which ought to be and will be associated with the success of these measures is the name of Richard Cobden. Without scruple, Sir, I attribute the success of these measures to him.
As a result the Conservative Party divided and the Whigs formed a government with Russell as PM. Those Conservatives who were loyal to Peel were known as the Peelites and included the Earl of Aberdeen and William Ewart Gladstone. During 1859 the Peelites merged with the Whigs and the Radicals to form the Liberal Party. Disraeli became overall Conservative leader during 1868, although, when Prime Minister, he did not attempt to reintroduce protectionism.
Scholars have advanced several explanations to resolve the puzzle of why Peel made the seemingly irrational decision to sacrifice his government to repeal the Corn Laws, a policy which he had long opposed. Lusztig (1995) argues that his actions were sensible when considered in the context of his concern for preserving aristocratic government and a limited franchise in the face of threats from popular unrest. Peel was concerned primarily with preserving the institutions of government, and he considered reform as an occasional necessary evil to preclude the possibility of much more radical or tumultuous actions. He acted to check the expansion of democracy by ameliorating conditions which could provoke democratic agitation. He also took care to ensure that the concessions would represent no threat to the British constitution.
The price of corn during the two decades after 1850 averaged 52 shillings. Due to the development of cheaper shipping (both sail and steam), faster and thus cheaper transport by rail and steamboat, and the modernisation of agricultural machinery, the prairie farms of North America were able to export vast quantities of cheap corn, as were peasant farms in the Russian Empire with simpler methods but cheaper labour. Every corn-growing country decided to increase tariffs in reaction to this, except Britain and Belgium. During 1877 the price of British-grown corn averaged 56 shillings, 9 pence a quarter and for the rest of the nineteenth century it never reached within 10 shillings of that figure. During 1878 the price decreased to 46 shillings, 5 pence. By 1885 corn-growing land declined by a million acres (4,000 km²) (28½%) and during 1886 the corn price decreased to 31 shillings a quarter. Britain's dependence on imported grain during the 1830s was 2%; during the 1860s it was 24%; during the 1880s it was 45%, for corn it was 65%. The 1881 census showed a decline of 92,250 in agricultural labourers since 1871, with an increase of 53,496 urban labourers. Many of these had previously been farm workers who migrated to the cities to find employment, despite agricultural labourers' wages being higher than those of Europe.
Although proficient farmers on good lands did well, farmers with mediocre skills or marginal lands were at a disadvantage. Many relocated to the cities, and unprecedented numbers emigrated. Many emigrants were small, undercapitalized grain farmers who were squeezed out by low prices and inability to increase production or adapt to the more complex challenge of raising livestock. Similar patterns developed in Ireland, where cereal production was labour intensive. The reduction of grain prices reduced the demand for agricultural labour in Ireland, and reduced the output of barley, oats, and wheat. These changes occurred at the same time that emigration was reducing the labour supply and increasing wage rates to levels too great for arable farmers to sustain.
... were designed to protect English landholders by encouraging the export and limiting the import of corn when prices fell below a fixed point. They were eventually abolished in the face of militant agitation by the Anti-Corn Law League, formed in Manchester in 1839, which maintained that the laws, which amounted to a subsidy, increased industrial costs. After a lengthy campaign, opponents of the law finally got their way in 1846 —- a significant triumph which was indicative of the new political power of the English middle class.