IF it were possible to express in figures the direct pecuniary loss which society suffers from the social mal-adjustments which condemn large classes to poverty and vice, the estimate would be appalling. England maintains over a million paupers on official charity; the city of New York alone spends over seven million dollars a year in a similar way. But what is spent from public funds, what is spent by charitable societies, and what is spent in individual charity, would, if aggregated, be but the first and smallest item in the account. The potential earnings of the labor thus going to waste, the cost of the reckless, improvident and idle habits thus generated, the pecuniary loss (to consider nothing more) suggested by the appalling statistics of mortality, and especially infant mortality, among the poorer classes; the waste indicated by the gin palaces or low groggeries which increase as poverty deepens; the damage done by the vermin of society that are bred of poverty and destitution — the thieves, prostitutes, beggars, and tramps; the cost of guarding society against them, are all items in the sum which the present unjust and unequal distribution of wealth takes from the aggregate which, with present means of production, society might enjoy. — Progress & Poverty — Book IX, Chapter 2: Effects of the Remedy, upon distribution and thence on production
see the corresponding passage in Drake's abridgment of P&P
Further, if it were possible to calculate the full cost of poverty, it would be appalling. New York City alone spends over seven million dollars a year on charity. Yet spending by government, private charities, and individuals combined is merely the smallest item in the account. Consider the following items: the lost earnings of wasted labor; the social cost of reckless and idle habits; the appalling statistics on mortality, especially infant mortality, among the poor; the proliferation of liquor stores and bars as poverty deepens; the thieves, prostitutes, beggars, and tramps bred by poverty; and the cost of guarding society against them.
These are just part of the full burden that unjust distribution of wealth places on the aggregate society. The ignorance and vice produced by inequality show themselves in the stupidity and corruption of government, and the waste of public funds.