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The lower strata of the middle class-the small tradespeople,

shopkeepers, retired tradesmen generally, the handicraftsmen and

peasants-all these sink gradually into the proletariat, partly

because their diminutive capital does not suffice for the scale

on which Modern Industry is carried on, and is swamped in the

competition with the large capitalists, partly because their

specialized skill is rendered worthless by the new methods of

production. Thus the proletariat is recruited from all classes of

the population.