PRINCIPLES OF SCIENTIFIC SOCIALISM. PRINCIPLES OF SCIENTIFIC SOCIALISM BY REV. CHARLES H. VAIL, Author of " Modern Socialism," National Ownership of Railways," Etc. CHICAGO CHARLES H. KBRR & COMPANY CO-OPERATIVE COPYRIGHT 1899, BY CHARLES H. VAIL. PREFACE. THE Socialism of to-day is distinguished from the Utopian theories of the past by the fact that it is scien- tific. All great movements inevitably pass through a Utopian phase and Socialism is no exception to the gen- eral rule. Socialism is evolutionary in character. There have been the John the Baptists of the new order, proclaiming the way of peace in the industrial wilderness. As alchemy and astrology preceded chemistry and astronomy, so the Utopias of Owenism, Fourierism and Simonism had to precede the full development of Scientific Socialism. These precursors of social democracy aimed to run society into a special mould. In the absence of a thor- ough knowledge of economic laws they conceived that an industrial system was something society could put on, as a man puts on a suit of clothes, ready made. They thought a perfect system could be invented and super- imposed upon society through propaganda. Their crude theories corresponded, as Fredrick Engels has pointed out, to the crude state of capitalist production and to the crude state of the classes. Nevertheless, these men had a far-sighted historic penetration and sagacity. They C5] 6 PREFACE. were admirable critics of capitalist methods, depicting with keenness and satire the evils inherent in capitalist society, but they had not the data to enable them to clearly perceive the genesis of capitalist exploitation. The Utopianists did well, but it was left for Karl Marx to clearly point out the source of surplus-value and the evolutionary tendency in economics. Marx did for economics what Darwin did for biology. The dis- coveries of Marx placed Socialism upon solid ground and reduced it to a science. Modern Socialism, then, is scientific and rests upon a historical, economic and scientific basis. It points out with accuracy the laws of social and economic evolu- tion. Socialism is the only solution of modern problems, and a clear understanding of its principles and purposes is the one great need of the world to-day. To explain the principles of this world-wide movement, and thus aid in a better understanding of the subject, is the pur- pose for which this book has been written. I trust that it may contribute to this end and so be of service to the cause. With this hope I send it forth on its mission. CHARLES H. VAIL. JERSEY CITY, N. J. May, 1899. TABLE OF CONTENTS. CHAPTER I. PACK The Industrial Evolution 9 CHAPTER II. The Analysis of Value 35 CHAPTER HI. The Origin ef Surnlus- Value 53 CHAPTER IV. Advantages of Socialism 66 1. Production 66 2. Distribution '. . 71 3. Elimination of Useless Vocations. , 74 4. Prevention of Waste 78 5. Elevation of Woman 84 6. Proper Care and Training of Children 87 7. Efficient Directors 89 8. Solution of the Monetary Question 91 9. Abolition of Taxation 92" 10. Simplification of Government 93 11. Benefits to Capitalists 94 12. Benefits to Laborers 97 CHAPTER V. Evidences of the Moral Strength of Socialism 102 1 . Its Spirit and Aim ..;.., 102 2. Its Abolition of Business Dishonesty. 106 3. Its Restriction of Divorce no 4. Its Prevention of Prostitution 1 1 1 5. Its Elimination of Crime * 114 6. Its Prevention of Intemperance, Insanity, etc 116 CHAPTER VI. Poverty Its Cause and Cure 122 6 PREFACE. were admirable critics of capitalist methods, depicting with keenness and satire the evils inherent in capitalist society, but they had not the data to enable them to clearly perceive the genesis of capitalist exploitation. The Utopianists did well, but it was left for Karl Marx to clearly point out the source of surplus-value and the evolutionary tendency in economics. Marx did for economics what Darwin did for biology. The dis- coveries of Marx placed Socialism upon solid ground and reduced it to a science. Modern Socialism, then, is scientific and rests upon a historical, economic and scientific basis. It points out with accuracy the laws of social and economic evolu- tion. Socialism is the only solution of modern problems, and a clear understanding of its principles and purposes is the one great need of the world to-day. To explain the principles of this world-wide movement, and thus aid in a better understanding of the subject, is the pur- pose for which this book has been written. I trust that it may contribute to this end and so be of service to the cause. With this hope I send it forth on its mission. CHARLES H. VAIL. JERSEY CITY, N. J. May, 1899. TABLE OF CONTENTS. CHAPTER I. PACK The Industrial Evolution 9 CHAPTER II. The Analysis of Value 35 CHAPTER III. The Origin ef Surolus- Value 53 CHAPTER IV. Advantages of Socialism 66 1. Production . . . 66 2. Distribution 71 3. Elimination of Useless Vocations. - 74 4. Prevention of Waste 78 5. Elevation of Woman 84 6. Proper Care and Training of Children 87 7. Efficient Directors 89 8. Solution of the Monetary Question 91 9. Abolition of Taxation 92 10. Simplification of Government 93 11. Benefits to Capitalists , 94 12. Benefits to Laborers 97 CHAPTER V. Evidences of the Moral Strength of Socialism 102 1. Its Spirit and Aim. 102 2. Its Abolition of Business Dishonesty 106 3. Its Restriction of Divorce 1 10 4. Its Prevention of Prostitution 1 1 1 5. Its Elimination of Crime <. 114 6. Its Prevention of Intemperance, Insanity, etc.. .. 116 CHAPTER VI. Poverty Its Cause and Cure 122 TABLE OF CONTENTS. CHAPTER VII. PAOE Wage Slavery vs. Chattel Slavery ._ 132 CHAPTER VIII. Rent and Interest. 1 40 CHAPTER IX. The Law of Wages 148 CHAPTER X. The Law of Progress 161 CHAPTER XI. Industrial Depressions and Commercial Crises. . 176 CHAPTER XII. The Problem of Labor-Saving Machinery 191 CHAPTER XIII. Popular Economic Errors 200 1. That Value is Determined by Capitalist Cost of Production 200 2. That the Interests of Laborers and Capitalists are Identical 207 3. That Labor is Better off To-day than Ever Before 211 4. That Cheap Prices are Beneficial to Labor 214 5. That Foreign Markets are Beneficial to Labor. . . 216 6. That Luxury is Beneficial to Labor 218 7. That Land Nationalization would Solve the Social Question 219 8. That Extravagance is the Chief Cause of Eco- nomic Want 222 9. That Socialism would Thwart Inventions and Improvements 224 10. That Socialism would Destroy Individuality ..... 226. CHAPTER XIV. Conclusion 229 INDEX 233 PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER I. THE INDUSTRIAL EVOLUTION. THE economic activity of man is of two kinds isolated and social. The former belongs to the earliest stages of human development. Here man, as yet but little differentiated from the beasts of the field, closely resembles them in his economic life. This is precisely what we should expect when we realize that man has gradually developed from the lower animals. Thus we are not surprised to learn that the wild men of Australia never co-operate in their economic efforts. In the course of time the family arose, and with the strengthening of the family relationship there grew up the unit of human society. But the economic life of this social unit was at first isolated, beginning and ending in itself; Gradually the family enlarged and grew into [9] 10 PRINCIPLES OF SCIENTIFIC SOCIALISM. the tribe, and the rude communism of the early ages with its social economic life appeared. This early com- munism finally gave way to slavery, but slavery was not incompatible with the maintenance of a communistic or semi-communistic tribal system. Finally private prop- erty displaced communism, and with new conquests and federations slavery became the principal method of production. But with the fall of the Roman Empire, the greatest chattel slave empire of antiquity, the way was prepared for feudalism. After the downfall of the Roman Empire there followed a period of transition, but at last the feudal system became the prevailing organi- zation in Western Europe. Free labor, however, existed from the earliest times and was not overcome by slavery or feudalism. Side by side with serfdom there was a large body of free workers. These free peasants and free artisans, whatever dues the) might pay to their lords in return for privileges or services, were as free as men of that day could be. The artisans gathered around the castle or in the fortified cities for protection from the robber hordes, and there carried on their various trades in democratic guilds and showed time and again that they knew how to protect their freedom against any at- tempt at encroachment by their feudal superiors to whom they were nominally subject. In the interior of the detached provinces into which Europe was split up production was carried on chiefly for home use. The family of the peasant produced nearly every requisite for its maintenance. It was only the excess over its own needs and the tribute to the feudal lord, that was offered for sale. That which is true of the peasant is also true of the artificer, as he also supplied most of his own wants. In the Middle Ages he possessed his own garden and a small patch of land, and had use of the commons for pasturage. In THE IND USTRIAL E VOL UTION. 1 1 this period we find production for sale greatly increased. The small industry of the Middle Ages, and for several centuries following, rested upon the individual owner-: ship, by the producers themselves, of the instruments of production. Both laborer and capitalist were com- bined in the same person so that no dispute could arise over the division of the product. The laborer owned his own tools, purchased or produced his own raw materials, and was master of his own product. In this period prop- erty in the product rested upon man's individual labor. As the means of production in this age were adapted to individual use, they were necessarily paltry and dwarfish. From the Middle Ages onward a master workman, under the guild regulations, might have two or three ap- prentices and as many journeymen. The latter worked for daily wages, in which case the master made a small profit, and might, perhaps, be considered an embryonic capitalist, but he was prevented by the strict rules of the guild, from extending the number of his helpers. The guild regulations in the town and the feudal system in the country, prevented the rise of capitalism proper. It was not until after the overthrow of these obstructions that capitalism developed. But the guild apprentices and journeymen worked not so much for their board and wages, as for the purpose of fitting themselves for mas- tership. Wage labor was only a by-matter, a mere makeshift. But this condition endowed the master with the potentialities of a .capitalist, although, as yet, he was restrained from extending his power. The money capital, formed by means of usury and com- merce, was prevented, as we have seen, from being turned into industrial capital, by the feudal constitution and the guild organizations. These fetters must first be broken before the capitalist regime could gain a foot- 12 PRINCIPLES OF SCIENTIFIC SOCIALISM. hold. Capitalist production presupposes the perfect freedom of the laborer. To be free, the laborer must not be attached to the soil as a serf or bound by the rules of the guild. Capitalist production also presup- poses the complete separation of the laborer from the means whereby he realizes his labor. It was the dis- solution of the economic structure of feudal society that set free the elements out of which the economic struc- ture of capitalistic society was formed. In 1348 the Black Death swept over England, carry- ing off one-third of the population. Labor was thus rendered scarce and wages immediately rose. Parliament enacted the noted " Statute of Laborers," decreeing that wages should be the same as before the plague, but it did not avail. The laborers went where they could se- cure the highest wages, and serfdom was virtually at an end. The nobles and landlords, however, did not at once relinquish their efforts to secure labor at the old price. Complaints were continually made to Parliament that the " Statute of Laborers " was not obeyed, and the statute was again and again re-enacted with new and severer penalties, but to no purpose. The peasants met this effort to reinstate the old order by combinations. They organized for the purpose of resisting the law. The instigators of this movement were Wiklif's poor priests, who gained the confidence of the peasants and organized them for the revolt which occurred in 1381. Although the insurgents were put down and their lead- ers captured and hanged, still the victory lay with them. In spite of the Acts to the contrary, the rate of wages remained high and was finally recognized by Parlia- ment. Serfdom practically vanished by the end of the four- teenth century, leaving the great mass of the population free peasant proprietors. The wage laborers of this THE INDUS TRIAL E VOL UTION. 1 3 period were few in number and each possessed a cottage and at least four acres of land, besides having access to the common lands for pasturage and fuel. This was the condition of labor in the fifteenth century, which has been called " the Golden Age " of English labor. Says Tames E. Thorold Rogers, M. P., late professor in Ox- ford University : " I have stated more than once that the fifteenth century and the first quarter of the sixteenth were the golden age of the English laborer, if we are to interpret the wages which he earned by the cost of the necessaries of life. At no time were wages, relatively speaking, so high, and at no time was food so cheap ! " l Toward the close of the fifteenth century was begun the revolution which laid the secure foundation of the capitalist system. The feudal lords having impoverished themselves by the French wars and the Wars of the Roses, began now to discharge their retainers. The breaking up of these feudal bands gave rise to the first proletariat. This landless class was also increased by the act of Henry the VIII. in suppressing the monasteries and evicting the monks. But this was not all. The impoverished nobility, being in need, began raising sheep for the wool market, and to this end they evicted the peasantry and turned the land into sheep-walks. The land which they had hitherto held in feudal tenure they claimed as private property. So long as they paid large sums of money to the king he cared but little how they treated the peasants. So they forcibly expropriated and expelled the agricultural population and fenced in the common lands. Although complaint was often made of the enclosure of arable and common fields and bill after bill passed in parliament to prevent this evil, still the process went on. This work i Work and Wages, Rogers, Humboldt Edition, p. 73. 14 PRINCIPLES OF SCIENTIFIC SOCIALISM. of spoliation and usurpation was carried on so success- fully that by the last decade of the eighteenth century the common land of the agricultural laborer and the yeomanry itself, had completely disappeared. Legisla- tion which at first had sought, though in vain, to prevent the theft of the people's land, at last became the instru- ment through which the spoliation was effected. The landlords, by Parliamentary Acts for enclosure, granted to themselves the people's lands as private property. This expropriation of the people's means of produc- tion furnished the town industries with a mass of pro- letarians who were unfettered by the guild regulations. The guilds, however, soon ceased to be a menace to the rise of capitalism, for Henry the VIII. suppressed them and confiscated their property. Another crime which Henry the VIII. committed against labor was the issue of debased currency. These two wrongs, together with the robbery of the people of their land, led to the down- fall of labor. The late Prof. Toynbee, Tutor of Baliol College, Oxford, speaking of the pauperism of the six- teenth century, says : " Farms were consolidated, and arable converted into pasture; in consequence, where two hundred men had lived there were now only two or three herdsmen. ... A main cause of th agrarian changes was the dissolution of monasteries, though it was one that acted only indirectly, by the monastic prop- erties passing into the hands of new men w^o did not hesitate to evict without scruple. About the same time the prices of provisions rose through the influx of the precio'us metals and the debasement of the coinage. . . . As regards the growth of pauperism in towns, the main cause may be found in the confiscation of the estates of the guilds by the Protector Somerset: These guilds THE IND US TRIAL E VOL UTION. 15 had been practically friendly societies, and depended far their funds upon their landed properties." * The laborer's condition was still further degraded by the Act of Elizabeth which established seven years as a necessary apprenticeship and endowed the justices- those who were interested in keeping the wages down with power to fix the rate of remuneration. This whole despicable process of spoliation and usurpation resulted in creating for the town industries a large supply of " free and outlawed proletariat." The peasants, robbed of their means of production and of the guarantee of existence afforded by the feudal regime, had no alternative but to sell themselves into wage slav- ery. The method of exploitation now becomes trans- formed. The beginnings of this refined method of fleec- ing, called capitalism, began as early as the fourteenth century in certain towns along the Mediterranean, but the capitalist era proper dates from the middle of the sixteenth century. Capitalist production, then, may be said to begin when a comparatively large number of laborers are engaged by one employer in the production of commodities. The early stage of manufacture is hardly distinguished from the handicraft trades of the guilds, except by the larger number of workmen employed by the same capital. In this period of manufacture, which extends from the middle of the sixteenth to the last third of the eighteenth century, co-operation, based on the division of labor, assumed its typical form. In the begin- ning of the manufactural age, men of the various in- dependent handicrafts were assembled in large work- shops, each performing his distinctive work, as, for in- stance, the production of wagons required the services i 77' e Industrial Revolution, Toynbee, pp. 97, 98. 1 6 PRINCIPLES OF SCIENTIFIC SOCIALISM. of wheelwrights, locksmiths, painters, etc. ; or, in other instances, where each artificer performed all the opera- tions requisite to the production of the finished com- modity. This form of production represents the ele- mentary stage of co-operation. In the course of time the work was gradually differentiated, and instead of one man performing in succession the various opera- tions, some definite work is assigned to each. The com- modity now becomes a social product. Manufactures arise, then, by the association of various distinct handicrafts, and also by the association of the artificers of a single handicraft. In both cases division of labor was gradually introduced, each operation, how- ever, continuing to be done by hand, and so remaining dependent on the skill and dexterity of the workmen. Division of labor is the characteristic principle of manu- facture. By this division of labor the productive power of labor is greatly increased. The laborer who only performs one single operation becomes more efficient than the artificer who performs a whole series of opera- tions in succession. The transition from one operation to another necessitates much loss of time. Moreover, where the work is specialized the workman's methods become perfected, and he learns how to accomplish a given result with the least expenditure of time and exer- tion. The chief characteristic that marks the age of manu- factures from that of modern mechanical or grand in- dustry, which began with the last third of the eighteenth century, is, that in the former the revolution in the mode of production began with the labor-power, while in the latter it began with the instruments of labor. Let us glance at some of the inventions which resulted in revolutionizing industrial methods. In 1750 the fly- shuttle was invented by Kaye of Bury. I& 1760 im- THE IND USTRIAL E VOL UTION. 1 7 provements were made in the carding process. In 1769 the spinning-frame was introduced by Arkwright, and Watt took out his patent for the first steam-engine. In 1770 the spinning-jenny was patented by Hargreaves. In 1779 the mule-jenny was invented by Crompton. In 1785 the power-loom was invented by. Cartwright. In 1792 the cotton-gin was invented by Whitney. The re- sult of these mechanical inventions was the complete change of the method of production. Fully developed machinery consists, as Marx pointed out, of three distinct factors, the motor mechanism, the transmitting mechanism, and the tool or working machine. It was with this last factor that the industrial revolution began ; that is, the apparatus and tools used by the handicraftsman and manufacturing workman were fitted into the body of machines, so that the mechan- ism performed the work previously done by the work- men. Here, then, is the real distinction ; it consists in taking the tool from the handicraftsman and fitting it into a mechanism. This accomplished, a machine sur- plants the mere implement, and it is of no consequence whether the motive power is derived from man or from some other source. In fact, many machines, such as sewing and bread-making machines, are constructed to be operated either by human or by mechanical motive power. Of course, even in the manufactural age, crude machines were invented and implements for which previously the motive power had been furnished by man, were operated by animal, water, and wind power. But at this time machinery played a subordinate part as com- pared with the division of labor. These machines pro- duced no revolution in industry, and are hardly worthy of the name. " The machine, which is the starting-point of the industrial revolution, supersedes the workman, who 1 8 PRINCIPLES OF SCIENTIFIC SOCIALISM. handles a single tool, by a mechanism operating wttli a number of similar tools, and set in motion by a single motive-power, whatever the form of that power may be. Here we have the machine, but only as an elementary factor of production by machinery. " Increase in the size of the machine, a*id in the num- ber of its working tools, calls for a more massive mechanism to drive it ; and this mechanism requires, in order to overcome its resistance, a mightier moving power than that of man." l This required motive-power was furnished by Watt's steam-engine which furnished a power sufficient to drive a number of machines simultaneously. With the appli- cation of steam to manufacturing the industrial revolu- tion was speedily effected. Along with this revolution in the tool came the revolution of labor ; the skill of the workman was transferred to the machine. The division of labor in the factory consists of the distribution of workmen among specialized machines. Here the machine makes use of the workman instead, as in handi- craft, of the workman making use of the tool. As soon as the tool is transformed into the machine, this instru- ment of labor competes with the laborer. The work formerly done by the skilled mechanic is now performed by the machine. The effect of these improvements is not only to render labor superfluous, but also to substi- tute the less skilled for the more skilled, the female for male, the child for adult. Prof. Ely, in speaking of this industrial revolution', says : " Capital, taking advantage of the inventions in industry and the improvement of means of communica- tion and transportation brought about by these inven- tions, was able to extend production and to carry it on on 1 Capital, Marx, p. 228. THE INDUSTRIAL EVOLUTION. 19 a scale of increasing magnitude. This production upon a vast scale, based upon a far-reaching division of labor, be- came essentially social production. Armies of men work together in single or allied establishments, each one doing his own small part of a vast whole. Capitalistic production passed out of the shop and entered the fac- tory. The master workman gave place to the captain of industry, and journeymen and apprentices to regi- ments of wage-earners." l Industry, then, has passed through three well-marked stages of development : 1. The Handicraft Stage, which was the period of small production. In the latter part of this period the laborer owned the few instruments of labor, and the re- sults of his labor were his without deduction. No em- ployer made a profit out of his labor. Both laborer and capitalist were combined in the same person. The only qualification that needs to be made is, that from the Middle Ages onward, under the guild regulations, a master workman might have two or three apprentices and as many journeymen. As the journeymen worked at daily wages, the master, of course, was enabled to make a small profit out of his labor, and so, perhaps, might be considered an embryonic or potential capitalist. But, as we have seen, where wage-labor existed it was only a by-matter ; the journeymen worked, not so much for wages, as to fit themselves for mastership. 2. The Manufacturing Stage, which was the period of manufactures. In this stage, beginning in the middle of the sixteenth century, the capitalist proper appears, though only half-fledged. The chief characteristics of this era were the employment of artisans in manufac- tories and the division of labor. Wage-labor, hitherto Socialism and Social Reform, Ely, p. 52. 20 PRINCIPLES OF SCIENTIFIC SOCIALISM. the exception, now becomes the general rule. The rea- son that laborers were compelled to submit to wage- conditions has already been considered. We reach here the stage of capitalist production, and the rise of profits proper which become the source of further capital, but the capitalist system is, as yet, undeveloped, and ex- tends to relatively few industries. 3. The Factory Stage, which is the period of modern or grand industry. This stage which began in the last third of the eighteenth century, is marked by a remark- able series of inventions and discoveries, which com- pletely revolutionized industry. With the incoming of the machine the race for fortune and wealth began. The chief characteristics which mark the beginning of this age have already been considered. NOTE : The different periods of industry vary somewhat in different countries. We have chosen England as an illustration, because her economic data is more complete, and her history o\ the expropriation of the agricultural laborer assumes the classical form. In America, owing to the newness of the country, the capital- ist system was at first slower in its development. This was due chiefly to the unbounded resources and natural opportunities. The old world had been in the Handicraft Stage of production for centuries when America was discovered, and En gland at the time of Columbus was about to pass into the Manufacturing Stage. During our Colonial days we were chiefly an agricultural nation, and this condition continued down to the war of 1812. " Before these hostilities," says Prof. Ely, "our chief pursuits were com- merce and agriculture, while manufactures were insignificant. There was more or less manufacturing industry, but it was pursued in small shops where the proprietor worked with his own hands, assisted by two or three journeymen and one or two apprentices. There was, for example, always the village carpenter and shoe- maker, and the blacksmith at the country cross-roads. But man- ufacturing on a large scale could scarcely be said to exist, and it was even in Europe only in the early stages of its development, for the ' industrial revolution ' had but recently begun." Pro- blems of To-day, p. 48. At the beginning of our National existence, then, America was THE IND US TRIAL E VOL U TION. 2 1 These periods, however, like geological epochs, over- lap each other. Thus, the handicraft and manufacturing industries still survive as relics of an antiquated age, but not, however, without many alterations due to the reac- tion of the factory system. Modern handicraft and manufacture have been greatly affected by the modern age in which they survive. They are reproduced, as it were, in the background of modern industry, though they are somewhat changed in character. 1 The whole history of economic development, then, is marked by the downfall of the small producer. The industrial revolution has marched steadily onward, leaving chiefly in the era of small production, although the period of manufactures, which, in England, was introduced in the middle of the sixteenth century, was already beginning. But industrial, like physical, evolution tends to reproduce itself in rapid succes- sion. The development here was hastened by the war of 1812 which destroyed our commerce and diverted the capital and labor, that formerly had obtained employment in international trade, to manufacturing. Says Prof. Taussig, " Establishments for the manufacture of cotton goods, woolen clothes, iron, glass, pottery, and other articles sprang up with a mushroom growth." There were but four cotton factories in this country in 1803, when new machinery and new methods began to be introduced. In 1805 the number of spindles was 4500, in 1815 the number had increased to 130,000. We pass very rapidly through the era of manufacture proper into the era of modern mechanical industry. But owing to our cheap and free land, which secured a livelihood to so many, our industries did not develop rapidly during the first half of the nine- teenth century. We were still, in a large measure, an agricul- ral people, and handicraft and manufacturing production, with some modifications, held the field in many directions. But since the civil war, the factory system has had a phenomenal growth, and is now rapidly taking on the trust form. Although the United States was behind Europe in getting started in the industrial evo- lution, nevertheless she has outstripped her competitors, and is to-day nearer the consummation than any other country. 1 For full exposition of Machinery and Modern Industry, see Marx' Capital, Part IV. Chapter XV. 22 PRINCIPLES OF SCIENTIFIC SOCIALISM, an ever-increasing number of propertyless proletarians in its wake. The small farm and factory has found it more and more difficult to compete with production on a large scale. The time is near at hand when all the small agriculturalists and industrialists will be divorced from the means of production and will help swell the proletariat class. Not only can we see the doom of these two classes, but also the downfall of the small capitalist. The field is becoming narrowed as the triumphal march of con- centration goes rapidly forward. As the great bulk of the population is dependent on the capitalist class, so the capitalist class as a whole is becoming dependent on a few who are veritable kings in the economic realm. The small merchant is also on the same downward grade. The department store is supplanting the small store. This process of extermination has been greatly ac- celerated by the various phases which this modern me- chanical era has assumed. We have seen how the era of manufacture was gradually transformed by the intro- duction of the division of labor, and so prepared for the next stage of development. In like manner the era of modern mechanical industry has been taking on several forms. In the beginning of this era we find both individ- ual and limited partnership owners of the machinery of production. But as machinery developed and the waste of competition necessitated the massing of large capitals that production might be cheapened and rivals under- sold, it has become more and more difficult for the in- dividual capitalist to furnish the requisite means, and so the joint-stock company has arisen. The origin of the joint-stock company completed the evolution of the capitalist. We have seen how at first he was a manual laborer working with his men, but the possession of a little wealth raised him above manual THE IND US TRIAL E VOL U TION. 23 labor, and he became a mental laborer, a manager, who received wages of superintendence. But the possession of more wealth raised him above even the labor of di- rection, and he handed this function over to an employe, thus becoming a mere interest or profit receiver. The capitalists united in a joint-stock company do not pre- tend to labor, but hire a manager in whose hands they place their capital, and whose business it is to make profits for the stockholders. The whole capitalist class, as such, have thus become superfluous, the services previously rendered by them being handed over to hired managers. Says Sidney Webb : " The older economists doubted whether anything but banking and insurance could be carried on by joint-stock enterprise : now every conceivable industry, down to baking and milk- selling, is successfully managed by the salaried officers of large corporations of idle shareholders. More than one-third of the whole business of England, measured by the capital employed, is now done by joint-stock com- panies, whose shareholders could be expropriated by the community with no more dislocation of the industries carried on by them than is caused by the daily purchase of shares on the Stock Exchange." 1 The next phase of this evolution was the union of these companies into a trust. The appearance of the trust upon the industrial horizon, which has resulted from the concentration of business in fewer hands, is the most significant phenomenon of the present day. This gradual development of competing Industries into mon- opolies is destined, at no distant future, to usher in the Co-operative Commonwealth. One who understands the causes which have led to the substitution of com- bination for competition, well knows the impossibility of ever returning to the latter. The choice must be * Fabian Essays, Humboldt Edition, pp. 25, 26. 24 PRINCIPLES OF SCIENTIFIC SOCIALISM. made between monopoly under private control and monopoly under public control, for monopoly, in some form, is certain to obtain. As the corporation is more powerful than the individual, so the trust is more power- ful than the corporation. Combination in one industry necessitates combination in all. The efficiency of capital in large masses is what has been called the law of in- dustrial gravitation. Associated capital and machinery are necessary to effective and economical production. The return to the days of competition and small things would constitute a reversal of all progress. The business of the future must be done by organized capital ; it is the only way the needs of the people can be met. The quicker this is realized the better. To all quack proposi- tions we must offer a steady and unflinching resistance. The question is, Shall we have organized capital in the hands of individuals, or in the hands of society ? The choice is not between competition and combination for the former is rapidly disappearing. Combination either of the few or of the many is inevitable. Combina- tion is the socialistic way of doing business; competi- tion is the individualistic way. Every trust virtually ad- mits the truth of Socialist charges, that competition is wasteful, and that by combination the cost of production is greatly reduced and harmony restored in the indus- trial realm. Industry, as we have seen, has successively passed from the Handicraft Stage of production into the era of manufactures, and from thence into modern mechanical industry, and this era has evolved into the corporate or joint-stock stage and is now rapidly taking on the form of monopoly. But this monopolistic strfge, which we have 'entered, is not the end, for as individuals have combined into corporations and corporations into trusts, so trusts will combine into a Co-operative Common- THE INDUSTRIAL EVOLUTION 2$ wealth. This being logical is inevitable. In economic evolution there is no retrogression. It is only in uni- versal combination that a complete consummation can be attained. Trusts must combine into a great trust the Nation. There is no more possibility of our re-entering any of the past eras of production from which we have evolved than there is of the butterfly re-entering the chrysalis. The stage of handicraft and manufacturing, and even the competitive stage of modern mechanical in- dustry has passed, or is rapidly passing, into innocuous desuetude. As slavery gave way to feudalism and feudalism to capitalism, so capitalism must give way to Socialism. But everything in its own order, first the blade, then the ear, and after that the full corn in the ear. Socialism is the full corn in the ear, and will come as the final consummation of the industrial development. Many express a fear of Socialism without realizing that one form of Socialism is already here, the pluto- cratic. This plutocratic Socialism Socialism without democracy is the only form we need to fear. The trust utilizes the methods of Socialism combination, co- operation and co-ordination to get the best results from man and nature without the Socialist aim and spirit. The trust is simply Socialism for the benefit of the few. The trust, however, has come, and come to stay. The only solution of the problem is that which has been pointed out, the socialization of the trust, that the bene- fits now monopolized by the few may become the in- heritance of all. The choice must be made between plutocratic Socialism and democratic Socialism. We have seen how the industrial revolution has wrought the downfall of the small producers and dis- tributers, so that to-day the great instruments of pro- duction and distribution are social in character, though as yet under private control We have also seen 26 PRINCIPLES OF SCIENTIFIC SOCIALISM. how the industrial revolution resulted in the loss of con- trol by the workers of the instruments of production, and the reduction of the once independent handicrafts- men and agriculturalists to the level of wage-slaves. The transformation of the limited implements of production into mighty powers resulted in turning them into social instruments, thus precluding individual ownership on the part of the workers. The vast cost of the new machinery and the large amount of capital required for the new methods of production, gave rise to a capitalist class the owners of the instruments of production. The laborers must have access to the means of pro- duction or starve ; but this access is obtainable only through the competitive wage. The ownership of the means of production gives men power over their fellows. Men being unable to employ themselves are obliged to sell their liberties for the opportunity of earning a mere existence. In the words of Bebel, " The basis of all op- pression is economic dependence on the oppressor." This condition of oppression has been heightening with the development of capitalism. Just in proportion as the instruments of production have been monopolized by a few, social misery, industrial servitude, and political de- pendence have increased. This monopoly of the imple- ments of livelihood forms the basis of every kind of deg- radation. Hence the necessity of a speedy consummation of the industrial development. This is in order that we may attain economic freedom the basis of all freedom. For if the laborers' servitude is caused through the ap- propriation by a class of the means of production, their emancipation can only be realized by their again becom- ing owners of the means of labor. Although individual ownership is impossible, owing to the subdivision of labor and the immense scale of production, still, the solution is not hopeless, for the change in the method of THE IND US TRIAL E VOL UTION. 2 7 production points out to us the solution of the problem. We have seen that the industrial revolution has resulted in socializing the method of production ; therefore the instruments of production should also become socialized to correspond with the socialized method. As tools are used in common they should be owned in common. The private ownership of the instruments of production is becoming more and more incompatible with the nature of these instruments. Their magnitude and social char- acter mark them for social ownership and control. The whole conflict in the industrial realm to-day is due to a failure to recognize the social character and nature of the instruments and methods of production. Al- though the method of production has changed, the method of appropriation remains unaltered. Social pro- duction, with capitalist ownership of the instruments, means capitalist appropriation of the results of social labor. Property which originally rested upon individual labor now rests upon capitalist exploitation. Let us abolish this incongruity between social production and capitalist appropriation by restoring to the people the control of their economic interests. Although it is im- possible for them as individuals to regain this control, for the industrial system of the future, as we have seen, must be systematized, nevertheless, they can bring these interests under collective control, substituting for the present irresponsible rule of the few, responsible pub- lic agents who will manage the affairs of society in the interests of society. Every industry that has reached its trust stage of de- velopment is eminently ripe for appropriation by the community. It is useless to say that an enterprise can- not be managed by society when it is being managed by a group of capitalists. The board of directors who as a rule do not own the capital invested can as readily be made responsible to society as to the shareholders. 28 PRINCIPLES OF SCIENTIFIC SOCIALISM. The directors in charge at the time of transition could be retained, if thought advisable, simply making them responsible to all the people instead of to the few favored stockholders. Socialism is thus seen to be practical as well as inevitable. The realization of this final stage of industrial development is nearer than many think. But it may be asked, How is this transformation to be effected ? We now come to the mission of the modern proletariat. 1 The proletariat the fourth estate has a mission to perform, and that mission is the abolition of wage slavery. Says Buckle, " No great political im- provement, no great reform, either legislative or execu- tive, has ever been originated in any country by its rulers." Wendell Phillips corroborates this truth in the following language : " No reform, moral or intellectual, ever came -from the upper classes of society. Each and all came from the protest of the martyrs and victims. The .emancipation of the working people must be achieved by the working people themselves." We have traced the transformation of the economic order since the Middle Ages, through its varied stages, and noted how the various classes the feudal lords, the capitalists, etc. have performed their parts in the evolu- tion of the industrial order. We have also seen the proletarians gathered together in large factories, where they are organized and disciplined, but thus, far they have remained chiefly a passive factor. At first they were small in numbers compared with the great middle 1 By proletariat is meant those deprived of property in the in- struments, of production. It includes not only manual laborers but the great bulk of the professional body, as a large majority of such are economic dependents. The "educated" or "intellec- tual " proletarians have rapidly increased within the last few years, and many of them have become able and courageous exponents of Socialism. The industrial evolution is thus furnishing the masses with the intellectual leaders needed. THE IND US TRIAL E VOL UTION. 29 class, and it was impossible, at that time, that their mis- sion should be either comprehended or fulfilled. It was first necessary for the economic evolution to work itself out in the expropriation of large numbers of the middle class and so increase the number of the propertyless, before the condition was propitious for the proletarians to work out their destiny. This condition has recently been realized. To illus- trate, in 1897 there were 1,168,343 firms doing business in the United States and Canada, of which 223,332 either failed or wound up their affairs after reaching a condi- tion of practical bankruptcy. Of the 15,008 firms driven into legal bankruptcy, 88.9 per cent, were firms having a capital of $5,000 or less each, and 7.6 per cent, were firms having a capital of more than $5,000, but less than $20,000 each. Were it not that many stand ready to invest their small savings or inherited property in middle class enterprises, in less than five years every firm in the United States and Canada doing business on less than $20,000 capital, would pass into innocuous desuetude. But as the supply of these aspirants to bankruptcy is not unlimited they will soon terminate, and the middle class will be known only by tradition. The middle class will thus disappear, and while a few may be able to join the larger capitalists, the great mass will recruit the proletariat. Not only is the wealth concentrating in the hands of the capitalist class, but even in this class there is a ten- dency of the few to become supreme. The capitalist class, which constitutes 9 per cent, of the population, is composed of 1,096,265 families, representing an aggre- gate wealth of $42,643,162,657, or, on an average, $38, 898 per family. Only a small proportion of the families, then, can be listed as plutocrats. Upon this dependence within the capitalist class, where a few men are becoming 30 PRINCIPLES OF SCIENTIFIC SOCIALISM. veritable kings, Mr. Holmes, of the United States Cen- sus Office, says: "Among the^ 1,096,265 families in which seventy-one per cent, of the wealth of the country is concentrated, there is still further concentration which may be indicated by taking account of the wealth of the very rich. The New York Tribune's list of 4,047 mil- lionaires affords the best basis for this. . . . The 4,047 millionaires are worth not less than ten or more than fifteen billions, say twelve billions, or about one-fifth of the nation's wealth. This gives an average of about $3,000,000." Mr. Thomas G. Shearman, in speaking of the wealth of seventy of our wealthiest millionaires, corroborates this statement as to the great concentration within the capitalist class. He says : " Making the largest allow- ance for exaggerated reports, there can be no doubt that these seventy names represent an aggregate wealth of $2,700,000,000, or an average of $38,500,000 each. No information has been sought concerning those worth less than $20,000,000, but the writer accidentally learned of fifty other persons worth over $10,000,000, of whom thirty are valued in all at $450,000,000, making together one hundred persons worth over $3,000,000,000 ; yet this list includes very few names from New England, and none from the South. Evidently it would be easy for any well-informed person to make up a list of one hundred persons averaging $25,000,000 each, in ad- dition to ten averaging $100,000,000 each." Mr. Lucien Sanial has shown that the plutocratic class representing but 1.41 per cent, of the population hold 64.37 P er cent, (and with its allies, the foreign investors, about 67^ per cent.) of the total wealth produced by American labor. The middle class representing 37.56 per cent, of the population hold 24.53 P er cent, of the wealth. The professional class representing 6.03 per THE IND t/S TRIAL E VOL UTION. 3 1 cent, of the population own 3.83 per cent, of the wealth, while the working class, representing 55 per cent, of the population, own but 4.21 per cent, of the total wealth. The professional and working classes, which together constitute the proletariat class, represent 61 per cent, of the total population and own only 8 per cent, of the total wealth. 1 This is sufficient to show the tremendous concentration of wealth in the hands of a few. It will be but a short time, even at the present rate of congestion, before I per cent, of the population will own 99 per cent, of all the wealth. Society will then be composed of a few enormously wealthy families on the one side and a vast body of proletarians on the other. Let us not forget that society is an organism and Socialism is the last expression of economic evolution. The time was not ripe for Socialism until the capitalist system had taken on its logical expression in the trust and syndicate. Until this stage no social or political up- heaval could accomplish more than to upset thrones and behead monarchs. Such a revolution would accomplish nothing. We need to appreciate this truth when, as in these days, so many quack remedies are proposed, and among them the delusion that the cause of the proletariat could be helped by a grand physical revolution or out- break of anarchy. Such ideas utterly fail to recognize the evolutionary character of economics. They are gen- erally put forward by those who have become outraged by capitalistic methods, but who are still groping in the dark for the true remedy ; or, if they perceive the solu- tion, have so imbibed reactionary doctrines that they fail to see the inconsistency of their position. It is not the first time that men have unknowingly held views that were mutually exclusive. Now it was but natural that this economic condition; i The Socialist Almanac t 1898, p. 113. 32 PRINCIPLES OF SCIENTIFIC SOCIALISM. as it became more pronounced, should find political ex- pression. That the proletarian should discover, sooner or later, that his interest did not lie in the direction of his exploiters, was inevitable. And what more natural than that he should organize politically to secure his rights. The class-conscious proletarians are to-day thus organized under the banner of International Socialism, and the struggle for supremacy has already begun. Socialists wish to attain political supremacy as a means whereby they may usher in the Co-operative Common- wealth, thus realizing their economic ideals. Socialists realize the futility of fighting capitalism with its own weapons, capital with capital. The proletarian is un- equipped in the economic field for encounter with the thoroughly organized forces of capitalism. But in the political field the proletarian is supreme. Here he meets the capitalist as an equal, while as a class the proletariat overwhelmingly outnumber the capitalists, and their ad- vantage is constantly increasing with the bankruptcies in the middle class and the narrowing of the capitalist class. The time has come for the manual and mental workers to unite and strike for liberty. Strike at the ballot-box, for the mastery of the public powers is the first step toward emancipation. Let us rejoice that this call for united action has been heard and is being obeyed. The proletarians of the various trades are being welded together and leavened by the spirit of brotherhood ; they are forming a class-conscious power before whom the thrones of the world are beginning to tremble ; they are uniting for political action to the end that they may con- quer the public powers and convert the nations of the world into Co-operative Commonwealths. In all previous social revolutions class has superseded class. The class below has overthrown the class above, thus emancipating itself by subjecting others. But THE INDUSTRIAL EVOLUTION. 33 Socialism will abolish all classes by abolishing all forms of human exploitation. The emancipation of the pro- letariat will mean the emancipation of all. Although Socialism would really benefit all classes, the initiative and propaganda must rest chiefly with the pro- letariat. The property holders, like the slaveholders of old, are blind to their higher interests. To be sure, there are a few here and there who are able to look be- yond the horizon of their own class and perceive the doom of capitalist production. Of course, we can expect nothing from large exploiters. While it is true that ultimately they would reap an advantage, still, they would lose the power and distinction they enjoy to-day and would be obliged to render some useful service to so- ciety, all of which is decidedly distasteful to them. But it is otherwise with the small producers and traders ; they have nothing to lose and everything to gain by the es- tablishment of the Co-operative Commonwealth. Under the present system they are hopelessly doomed to bank- ruptcy, and it is only a question of little time before they will join the ever-growing majority the pro- letariat. But their ignorance of economic conditions, which leads them to hope for the preservation of their class, binds them to the sinking ship of small enterprise. We can hope for but little from the members of this class so long as they retain their economic foothold, but when they become expropriated and are thrown into the pro- letariat class, they furnish good material for Socialism. Their economic downfall is quite apt to set them think- ing, and Socialism is being daily strengthened by such recruits. Socialists, then, count on the expropriated masses against the few expropriators. When the Socialists have gained control of the political machinery, which presup- poses that the great majority of the people want the change, then the Co-operative Commonwealth will be 34 PRINCIPLES OF SCIENTIFIC SOCIALISM. proclaimed in the name of the people as a new legal system. This would not be, as assumed by some, a difficult process ; not nearly as difficult as was the passing from feudalism to capitalism. Karl Marx has well stated this in the following words : " The transformation of scat- tered private property, arising from individual labor, into capitalist private property is, naturally, a process, in- comparably more protracted, violent and difficult than the transformation of capitalistic private property, al- ready practically resting on socialized production, into socialized property. In the former case we had the ex- propriation of the mass of the people by a few usurpers ; in the latter we have the expropriation of a few usurpers by the mass of the people." 1 When the Socialists have wrested the power of gov- ernment from the capitalist class they will at once pro- ceed to transform private businesses into socially managed concerns. Just as rapidly as practicable, trust after trust, and industry after industry, would pass under public administration the officials in charge being made responsible to the whole people until all produc- tion and exchange are socialized and the consummation of the industrial evolution completed. To Recapitulate: The industrial evolution has taken on several stages of development, viz. : the era of small production, the era of manufacturing production and the era of modern mechanical production This last era, marked by the introduction of the factory system, has taken on several phases of development. It began with the individual ownership of social tools, which was fol- lowed by the joint-stock or corporation ownership, then trust ownership, and finally this trust ownership will evolve into public ownership, thus completing the in- dustrial evolution and establishing the Co-operative Commonwealth. 1 Capital, Marx, p . 487. THE ANALYSIS OF VALUE. 35 CHAPTER II. THE ANALYSIS OF VALUE. THE term value is commonly used to express two different ideas, value in use, and value in exchange. Every commodity has a use-value; i.e., it possesses utility ; but this property is something entirely separate from the amount of labor necessary for its acquisition. Use-values have been called " the material depositories of exchange-value." Exchange-value has to do, primarily, with quantita- tive relations, the proportion or ratio in which use- values exchange with each other. These use-values, which are exchangeable, must contain equal quantities of a common substance. In the exchange of commodi- ties the very fact of an equation shows that there exists in each commodity something common to all ; all such commodities can be reduced to a common factor. This common factor is, evidently, not a natural property of products, but something which natural products have acquired, thus making them commodities. Now, what is it that, applied to these natural products gives them value ? The answer is, human labor. Here, {hen, we find the common factor of all commodities. The re- lation in which one commodity stands to another can only be ascertained by comparison, and comparison can only be made between objects containing something in common. To be sure, all commodities are useful, but utility forms no part of comparison. " Utility," says Ricardo, " is not the measure of exchangeable value, al- 36 PRINCIPLES OF SCIENTIFIC SOCIALISM. though it is absolutely essential to it." I can buy a hat which is useful for three dollars, but its usefulness is not the reason I pay three dollars for it. I can buy a pair of shoes for the same price, but the shoes may be worth to me double the cost of the hat, especially if I am well supplied with hats and have no shoes. Again, I can buy a good dinner for one- sixth the cost of the hat or shoes and, if I have had nothing to eat for several days, the dinner would be worth more to me than both hat and shoes combined. The reason why I pay three dollars for these commodities is not that they are useful, but because they embody that amount of human labor; in other words, it would cost three dollars to produce or reproduce them. It is all-important that we keep these two meanings, in which value is commonly used, constantly in mind. A careless use of words has led many of the old econo- mists to fall into a confusion worse confounded. Adam Smith and Ricardo marked out clearly the distinction be- tween value in use and value in exchange, but Mill and Jevons have hopelessly confounded their meaning, and so value, with many of the lesser lights, has become merely an expression of the intensity of desire. Value, however , in the economic sense, although presupposing utility, has really nothing to do with use-value. Inasmuch as value in use means utility, it has been proposed by some economists, in the interest of clearness, to eliminate the term value in use, substituting utility when referring to qualities, but the term value in use is not misleading if we remember that value or exchange value is never used to express qualities, but only the worth or exchange re- lation of qualities. This brings us to one of the fundamental postulates of Socialism, that labor is the source of all value. Says Rodbertus, whom Prof. Wagner of Berlin calls " the THE ANALYSIS OF VALUE. tf Ricardo of Socialism," " All economic goods are to be regarded as the products of labor, and they cost nothing but labor." This principle, however, is not peculiar to Socialism, it has been laid down by all the leading economists. Says Ricardo, " The value of a commodity . . . depends on the relative quantity of labor which is necessary for its production." Says McCulloch : " The cost or value of all freely pro- duced commodities, the supply of which may be indefi- nitely increased (abstracting from temporary variations of supply and demand), depends wholly on the quantity of labor required for their production, and not upon the rate at which that labor may be paid. . . . This is the fundamental theorem of the science of value, and the clew which unravels the intricate labyrinth of the laws which regulate the distribution of wealth." Quotations to this effect might be multiplied. In fact, no one ever thought of questioning this principle until the advocates of the present order saw to what use Socialists put it, then Bastiat, the champion of capital- ism, came to the rescue and endeavored to invalidate the self-evident proposition. I say self-evident; for is it not ? Take any article of merchandise and what is there in it but labor ? No argument is necessary to establish this truth ; it is axiomatic. Capital, of course, is used by labor in the production of value, and that part which is consumed passes over and is embodied in the new product. While labor uses capital in production of values, capital is not the source of value ; labor alone is the source and creator of all value. When we say that labor creates all value, it is not meant that land and capital are not factors of pro- duction, but that labor alone is the active factor, the others being passive. Land and capital are the tools used by labor in the production of utilities. Production 38 PRINCIPLES OF SCIENTIFIC SOCIALISM. consists in labor modifying the natural products of na- ture, so as to better fit them to satisfy human desire. In this process capital is always used by labor, never labor by capital. We need also to make a careful distinction between capital aiding labor in production, and the proposition often put forth that capitalists aid labor. While capital renders labor great assistance and causes it to be im- mensely more productive, the capitalist is in no way of service. But capital itself produces no new value what- ever. Capital, the instruments of production, machin- ery, etc., like the forces of nature, adds to utilities, and so makes society richer. It does not add to values but always makes values fall. The machine parts with its value in the process of production, and adds propor- tionately to the value of the new product. After making allowance for the value which it transmits by its average wear and tear and for its consumption of auxiliary sub- stances, such as oil, coal, etc., it does its work, like the forces of nature, gratuitously. Man has thus at last succeeded, as Marx has pointed out, in making the pro duct of his past labor work on a large scale gratuitously Mr. Gunton, although not a Socialist, has stumbled on to this fact when he says : " Every improved machine which diminishes the cost of production, to that extent approximates gratuitous natural forces. . . . Capital, whose sole function is to aid and save labor, really sus- tains the same economic relation to production that natural forces do." J The machine, like other commodities, has its ex- change-value and its use-value. It ..imparts, however, only its exchange-value to new wealth. It serves as a use-value, and so can only transfer such value as it ai Principles of Social Economics, Gunton, p. 124. THE ANALYSIS OF VALUE. 39 ready possesses. It makes no difference how useful a machine may be, if it costs but fifty days' labor it can add only that value to the new product. The machine, like all constant capital, creates no new value. It is evident, then, that labor creates all value. In the current teachings of political economy, value is a relation between exchangeable things ; that is, the relation of value is a relation of ratio, or proportion, of things to things, instead of things to man, or labor. This mistaken point of view has given rise to the misconcep- tion that there can be no general rise or fall of values. Of course, all commodities cannot rise and fall simul- taneously, in their relation to each other, but they can and do in their relation to labor. And when we speak of a rise or fall of commodities, we mean an increase or diminution in the ratio in which they will exchange for labor. To say that the price of a commodity had risen or fallen because it will exchange for more or less of gold, would have no significance but for the fact that the change in the ratio in which commodities exchange for gold, indirectly expresses a change in the ratio in which they will exchange for labor. The whole difficulty arises from confounding value in labor and value in exchange. Many of the upholders of capitalism are coming to recognize as fallacious this doctrine that value is merely a relation between each exchangeable thing and all other exchangeable things. Mr. Henry George, in his last book, clearly points out the error of this position. He says : " It makes value de- pendent on value without possibility of measurement ex- cept arbitrarily and relatively, by comparing one value with another; that it leaves the idea of value swimming, as it were, in vacancy, without connection or fixed start- ing point, such as we attach to all other qualities of rela- 40 PRINCIPLES OF S^fENTIFIC SOCIALISM. tion, and without which any definte idea of relation is impossible. " Thus, such qualities as size, distance, direction, color consanguinity and the like are only comprehensible and intelligible to us by reference to some fixed starting point, to which and not to all other things having the same quality the relation is made. . . . " Now, has not also the idea of value some fixed start- ing-point, by which it becomes comprehensible and in- telligible, as have all other ideas of relation ? " Clearly it has. What the idea of value really springs from, is not the relation of each thing having value to all things having value, but the relation of each thing having value to something which is the source and natural measure of all value namely, human exer- tion." 1 The Science of Political Economy, George, pp. 227, 228. NOTE : In considering value, of course, we are dealing with such commodities as can be increased in quantity by the exertion of human industry. There are other wares, such as rare pictures and statues, wines of a particular quality made from grapes grown on a particular soil, etc., which have what is called a scarcity or monopoly value ; that is, their value is not determined by the amount of labor congealed in them, but purely by demand and supply. These articles are comparatively few in number and so have no real bearing upon the question. Scarcity can create nothing real, so the values that are due to it are unreal ones ; consequently, the exception if so it maybe called, only proves the law that labor alone creates all real values. We also need to note here the law of supply and demand. We have seen that the labor required to produce an article measures its value ; that is, its primary, natural, or level value. Now the only effect that demand and supply have, is to make the market price, vibrate now a little above and now a little below the real value. But these vibrations compensate each other, and, in the analysis of value it should be eliminated. This fact is recognized by the teachers of political economy. Says Ricardo, " It is the cost of production which must ultimately regulate the price of commodi- ties, and not, as has been often said, the proportion between the supply and demand : the proportion between supply and demand THE ANALYSIS OF VALUE. 4' Value, then, expresses the relation, not of things to things, but of things to labor the source of all value. As labor is the source of all valu VPLES Or SCIENTIFIC fraction," says Marx, " not the realizes form of In&t labor, by which the amount of the v?,lne of a Commodity i? determined," (C' Intemperance is thus not the real cause of poverty, poverty is begotten by our unjust economic system. If all were temperate they would still be poor, by virtue of the fact that they would be still dependent upon the monopolizers of the means of life. But this does not mean, of course, but that men who are poor often become destitute through intemperance. The condition of poverty is what breeds intemperance. Says Frances Willard : " Twenty-one years of experience have convinced me that poverty is the prime cause of intemperance." The same is true of insanity. There are some thousands of people in the United States who go insane every year for want of proper food and clothing. What a disgrace to civiliza- tion! The remedy for inebriety and insanity, as for other social evils, is in the abolition of our present industrial conditions. These evils are constantly increasing, and will continue to multiply so long as the present system exists. This system predisposes vast multitudes to intem- perance, insanity, crime, etc. It bequeathes to posterity a perverted and diseased nervous system which renders 1 Wtalth and Progress, Gunton, pp. 208, 211. MORAL STRENGTH OF SOCIALISM. 121 them suitable subjects of these evils. There is no rem- edy sufficient to effect a cure but the abolition of the present system of industry. Thus science points out to us the only way to social salvation. The social problem, in the last analysis, is merely the problem of wealth pro- duction and distribution. Owing to the organic nature of society this problem ramifies in all directions. Society is an organism, and just as when the physical organism is diseased the symptoms manifest themselves in vari- ous directions, so when the social organism is diseased, the symptoms take on various forms, expressing them- selves as intemperance, insanity, crime, pauperism, etc. All of the symptoms evidence a diseased body economic. We have now presented some of the evidences of the moral strength of Socialism. Is it not clear that the new order would realize a higher morality ? 122 .PR'XCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER VI. POVERTY ITS CAUSE AND CURE. THAT a vast majority of the human race is in poverty none will deny. So true is this that it is mere childish- ness to discuss the question of whether they are in some way better off than their forefathers. Surely they are poor enough, and we need not enter into any lengthy argument or statistics to substantiate the statement. Millions of people in this country always exist on the border of destitution. This is evident when we realize that only four and one-half per cent, of the national wealth belongs to fifty-two per cent, of its population, constituting seven millions of families. There are millions of people working under conditions and living in homes that are disgraceful. Millions of honest, industrious people are badly fed, clothed, and housed, and thousands die every year of preventable disease. We all recognize this fact and know, if we will stop to think for a moment, that there is no excuse for the existence of this hell of poverty. No God or devil is responsible. We are in Gehenna simply because we have kindled the fires, and are either unwilling, or too stupid, to put them out. We are surrounded by abundance of every kind. In fact, we have an overflow of products : so much so that the poverty from which we suffer is born of plenty. What an anomaly ! Overflowing storehouses on the one hand; starvation on the other: the people of this fair land in need of the common decencies and necessi- ties of life because too much has been produced. Amer- POVERTYITS CAUSE AND CURE. 123 ica, with all its inventiveness, the one country where we should expect to find continuous prosperity, is so plunged in degradation that in the great State of New York, in 1897, 2,551,455 persons, one-third of the in- habitants, applied for and received charitable aid. This included only the number assisted by those associations organized under the State laws, and so obliged to report to the Commissioner of Charities. If the aid rendered by church organizations and other benevolent societies were included the number of recipients would be in- creased at least fifty per cent. There are many causes assigned for poverty, intem- perance, improvidence, over-population, idleness, private ownership of land, etc. But none of these supposed fac- tors can be dignified by the name of cause. Each, however, may be such in some measure. Thus, the intemperate proletarian is often more indigent than his more tem- perate co-workers, and the improvident laborer is often poorer than his fellow who exercises the habit of thrift and self-help. But the whole matter is one of relative poverty within a class, who, by the very virtue of their being members of that class, are necessarily reduced to a condition of dependence. Even the temperate and provident laborer, by the most rigid economy, can no more than make the ends meet. That these virtues give him an advantage over his competitor no one can doubt, but his superiority would cease should all emulate these qualities. Those who attribute poverty to these causes overlook the fact that many are both intemperate and improvident and at the same time wealthy. Says Herbert Casson : " In spite of the greatest ex- travagance and laziness, there are millionaires who can- not get poor ; and in spite of the greatest industry and thrift, there are workingmen who cannot get out of debt," The fact is, the workers as a class are poor, 1 24 PRINCIPLES OF SCIENTIFIC SOCIALISM. while the idlers are rich. Twenty thousand people, all of whom are idlers and nearly all intemperate, own one- half of the United States. On the other hand, there are millions who, in spite of their industry and thrift, now occupy poorhouses and tramp-lodging houses. They have worked from their earliest years like slaves and now are obliged to suffer the miseries of a penniless old age. To ascribe poverty to idleness, improvidence, in- temperance, etc., is but adding insult to injury. The fact is, these conditions are begotten by the wage system. Mr. John Bascom, speaking of the wage system, says : " Its disadvantages are both economic and social. The workman ceases more and more, tinder this system, to be an intelligent, interested, and responsible partaker in production. This attitude favors in him indolence, in- difference, and improvidence. It very much limits that training in forecast and patience which well-ordered in- dustry is fitted to give. In the lower ranks of labor, this indolence and indifference prevail to a degree which frequently compels the employer to work his men in gangs with an overseer. Thus the wages of one man, whose duty it is to keep at work a group of five, ten, twenty, are deducted from their wages." * Mr. George Godard, in his book on Poverty, assigns the following causes for poverty. Insufficient produc- tion of necessities, industrial waste, unequal distribution of wealth. The latter, however, as he points out, is the chief cause, and even gives the latitude to the other causes. In conclusion he mentions a fourth cause, pov- erty as a cause of poverty, which is somewhat paradoxi- cal in form. Here the effect in turn becomes a cause. Thus, if insufficient production leads to poverty, poverty also leads to insufficient production. Laborers, to be 1 Social Theory, Bascom, pp. 232, 233. POVERTY ITS CAUSE AND CURE. 125 efficient, must be intelligent, well-housed, and well-fed. The poorer the laborers the more , ignorant, and conse- quently the less efficient. Again, if waste is the cause of poverty, poverty is also the cause of waste. Poverty engenders improvidence and recklessness. A weak mind is not conducive to fore- sight and thrift. Once more, if unequal distribution produces poverty, poverty produces unequal distribution. The poorer the people are, the more dependent they are and the less able to secure the full value of their toil. It is because labor- ers have been separated from the instruments of produc- tion that they are obliged to submit to excessive ex- ploitation. The laborer possesses nothing but his labor- power to sell, and must, of necessity, accept the price fixed by his employer. It is thus that this cause tends to perpetuate itself; poverty breeds poverty. The unequal distribution c : wealth, which is the essence of our pres- et system, reproduces the conditions which perpetuate this unequal distribution. When men are dispossessed of the instruments of production and become proletar- ians, there is little or no hope of their ever regaining their independence. They are obliged to compete with each other for an opportunity to earn a livelihood, and this necessity, caused by their poverty, results in increas- ing the disparity in the distribution of wealth. Thus, unequal distribution, when once established, tends to aggravate the evil. Poverty so weakens men in the in- dustrial conflict that they are unable to secure their just deserts. All of these causes mentioned by Mr. Godard are in- herent in our present economic system. The private ownership of the instruments of production results in labor exploitation, insufficient production of neces- sities, waste and the unequal distribution of wealth. 126 PRINCIPLES OF SCIENTIFIC SOCIALISM. Private ownership, then, is the real cause of poverty, and the only way poverty can be abolished is to make these instruments of production common property. This is evident if we examine the present structure of society. Let us look at the make-up of modern society. In the first place we note the capitalist class or non-pro- ducers. To be sure, many capitalists combine the priv- ilege they enjoy as capitalists with the office of super- tendency, and if so, they are entitled to remuneration. Again, capitalists often perform useless labor, as the manipulation of stocks, but such exertion creates no value. Their whole effort is to appropriate values al- ready created. Their labor is not only useless but dele- terious, of the same nature as that of a burglar. No one claims but that the thief labors, and often very hard ; his work is performed in the night, and amid great risk and anxiety. But his whole effort is detrimental to society, for he is only endeavoring to appropriate wealth which belongs to others. The same, in effect, is the effort of the stock speculator; he also appropriates the values others have created. This entire class is a burden upon society just as paupers are. They produce nothing but consume enormously. One millionaire is a greater burden upon society than five hundred paupers. Then there are those engaged in manufacturing. Many of these people work quite hard but much of their labor is useless. Those engaged in commerce and manu- facturing spend most of their energies in fighting among themselves to secure the largest portion of wealth which they have compelled the working class to give up. This constitutes prodigious waste. There are many times more men engaged in the production and distribution of wealth than is necessary. Under a rightly ordered sys- tem three-fourths would be saved in the realm of pro- duction and nine-tenths in the field of distribution. POVERTY ITS CAUSE AND CURE. 12? Think of the useless stores and shops with their useless proprietors and clerks. All of this host of men and women are living at the expense of the real producers. Then there is the professional class, such as the doc- tors, artists, and literary men, although they are useful to society, still they consume out of all proportion to their due share. There are others such as lawyers, who produce no wealth but are the hangers-on of the priv- ileged classes. There are many others of this species, such as the thousands engaged in banking, insurance, drumming, competitive salesmanship, advertisers, can- vassers, etc., etc. Here is a host of men and women use- lessly employed, who must be supported by the real pro- ducers. We now come to the real producing class. But not all labor is useful. Many laborers are engaged in pro- ducing things which only the rich can buy, which can minister only to luxury and folly, and which people liv- ing manly and uncorrupted lives would not think of re- quiring. Such products are not wealth but waste. Laborers engaged in the production of such products are not usefully employed. If ten men are working on a piece of ground and are able to live comfortably off the product of their toil, but by some means one man gets sole possession of the land, and so becomes able to ap- propriate one-half of the labor of the others, this advan- tage gives him more than he can consume, and so he withdraws four of the laborers and sets them to work at building him a castle and pays them out of his surplus product. Is it not evident that the remaining workmen will have to labor twice as hard as they did when all were engaged in the cultivation of the soil ? There are now the same number to consume necessaries, but only one- half the number to produce them. All laborers, then, engaged in ministering to the luxuries of the rich are 128 PRINCIPLES OF SCIENTIFIC SOCIALISM. useless and are as much a burden to be carried by the useful laborers as are the rich themselves. To these must be added the whole category of domestic servants, who are employed in ministering to the enjoyment of the wealthy. When we remember that this whole struc- ture of idlers and useless laborers are supported by those who are really engaged in the production of utilities, is it any wonder that poverty exists ? Is there anything strange about the degrading condition of those who toil ? And is there any enigima about the solution of the problem of poverty ? Is there any one who does not see that the poverty of the many is caused by the robbery and waste of the few ? So long as we have a privileged class who shirk their duty and compel others to do their work, so long will there be degradation and poverty. But why do laborers submit to this condition ? Sim- ply because the privileged class have gained a monopoly of the means of production which is necessary to labor. The laborer being unable to employ himself is obliged to submit to the conditions imposed upon him. The first step in the abolition of poverty is the abolition of the parasite class. Poverty will be impossible when every man is obliged to live off his own labor instead of the labor of others. At present, between the waste of labor-power in mere idleness and its waste in unproductive work, but a small part of the people are productively employed. Were all usefully employed and the waste of our compe- titive system eliminated, but a few hours' work would be required to produce an abundance for all. Abolish class robbery and the problem is solved. " Whereas it has been known and declared," says Ruskin, " that the poor have no right to the property of the rich, I wish it also to be known and declared that the rich have no right to the property of the poor." Give to every man PO I 'EK T YtTS CA USE AND CURE. 1 29 the full product of his labor and he will be able to live in decency and plenty. But it is said that the poor are poor because they are not fitted to be anything else; that the fittest survive and that this is the inexorable law of nature. Let us look at this law of the survival of the fittest. What does it mean ? It simply means that a plant, animal, or man that is best fitted to survive un- der certain conditions will survive. It has nothing whatever to do with the quality of the conditions. Ac- cording to this law the man who succeeds in a certain society is best fitted to that kind of environment. Thus, under certain conditions, one type of man will be best fitted to survive, while under different conditions a dif- ferent type will succeed. In the early days, when physi- cal strength was king, the man best fitted to survive was the one with physical power and endurance. To-day, when commercialism is king, the man who succeeds does not require strength of arm so much as cunning and clearness of head. A John L. Sullivan is the type of man best fitted to survive in ancient society ; a Rockefeller in modern society. But neither one of these types touches the moral qualifications. Evidently, then, the fittest has nothing whatever to do with morality. The poor, then, are poor simply because they are not fitted or have not the opportunity to succeed in the acquisition of wealth under present conditions. It does not follow that they are not worthy of a decent livelihood or that they might not succeed under different conditions. The survival of the fittest, under present conditions, does not secure the survival of the noblest and best, but rather the reverse. Commercialism, like physical combat, is a war, in which cunning in one instance and brutal force in the other succeeds. In commerce Jesus Christ would have been no match for Rockefeller; in physical combat Buddha 130 PRINCIPLES OF SCIENTIFIC SOCIALISM. would have stood no show with Sullivan, Now which is the best condition of society, that which gives the lowest type of humanity the pre-eminence, or the highest type ? If the highest type should succeed, ought not so- ciety to be so reconstructed that the noblest and best qualities shall have full play ? We have no objection to the law of the survival of the fittest, only we desire that society shall be so organized that the real fittest shall survive. We desire such a condition that the law shall work for good instead of evil. The law, as we have noted, insures the survival of those best adapted to the conditions under which it works. If the conditions are such that the unscrupulous and unjust are given an advantage, then these are the ones best adapted to succeed. We object to the present industrial and social conditions for the reason that it makes the basest the best fitted to survive. We wish to establish an economic and social environment under which all shall be " fit " and all shall " survive." We would so organize society that none would be pushed to the wall, and that while each would succeed in accordance with his fitness, still the success of one would not mean the failure of another. Socialism would reorganize so- ciety on such a basis as would guarantee the survival of all its members. It would abolish forever this hell of poverty which results from special privilege. The cause of poverty, then, is our present capitalist system of industry. It enables some to live in idleness and luxury by appropriating the wealth produced by others. The private ownership of land and capital con- stitutes an aristocracy of the few. The privileges which they thus enjoy as monopolists of the instruments of pro- duction enable them to levy a tax or tribute upon pro- 'iuctive toil. The same result was attained in the olden times by chattel slavery and feudalism. The distinctive PO VER T YITS CA USE- AND CUJiE. 1 3 1 feature of each of these systems of injustice is the power of the non-producers to appropriate the wealth created by producers. Under former systems the productivity of labor was small and, consequently, the conditions of the reign of peace and plenty were not so propitious. But the capacity of the modern system of mechanical production is almost unlimited. We have indeed attained the material basis for the abolition of all poverty. Whether or not the past with its pigmy tools of pro- duction could have attained the ideal (they certainly could not have realized a very high standard of living for all) it is certain that to-day enough could be produced to enable all to live in affluence. The capabilities of the modern tools of production are such that an abundance is possible for every man, woman, and child. This con- dition, although possible, is prevented by our perverse system of economics. Poverty to-day has no excuse for existence, and would be impossible were our social sys- tem such as to compel every man to live by the fruit of his own industry. The abolition of poverty will remove the cause of the social evils, and with the removal of the cause the effects, intemperance, thriftlessness, improvidence, etc., would rapidly disappear. Scarcely a generation would pass be- fore these social evils would be eliminated. Poverty, to-day, is inherent in the present industrial order. There is but one remedy for this condition the abolition of this cannibalistic system of industry. Capitalism is the present cause of poverty. Socialism is the only cure. 132 PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER VII. WAGE SLAVERY VS. CHATTEL SLAVERY. SOCIETY is an organism and, as such, it has passed through several stages of development. As cannibalism disappeared and made room for chattel slavery, so chat- tel slavery, in turn, disappeared and made room for wage slavery. While these several systems differ in some of their characteristics, they nevertheless have many fea- tures in common. Consequently, we find much in chattel slavery that was common to savagery, and much in wage slavery that was common to the chattel sys- tem. Let us note some of these common characteristics. Under both systems of slavery labor is essential to the production of wealth, and the product, although pro- duced by the slave, belongs to the master. Again, un- der both systems labor or labor-power is bought and sold. Under chattel slavery the laborer is the commo- dity; under wage slavery the labor-power is the com- modity. In both instances, the presence of the laborer is requisite, and the master, in order to obtain the serv- ices must give to the slave sufficient means to enable him to live. Thus far the two systems are substantially the same, but here a difference comes in. Under chattel slavery the master owned the workers, while under wage slavery he only needs to own that which is necessary to the workers' existence. If one owns that which men must have, he virtually owns the men who must have it. It is, then, WAGE SLA VER Y vs. CHA TTLE SLA VER Y. 133 no longer necessary to own human beings as chattels ; it is only requisite to own the world's resources and machinery, and economic serfs are at his disposal, The ownership of the machinery of production involves own- ership of the men who must use that machinery. If men were not bound to machinery by their bodily necessities, the various instruments of labor would possess no value whatever. If men did not need the use of land and would not consent to labor for its owner for permission to occupy it, land would cease to be of worth. We need to thoroughly grasp the fact that ownership of the machinery of production land, mines, factories, railroads, etc. would have no value whatever were not human beings bound to these instruments by their bod- ily necessities. The titles of this ownership, while nom- inally of things, is really of men, women, and children. Deeds, mortgages, stock-shares, etc., would be valueless but for the fact that thousands of workers are bound by physical necessities to the land and machinery which these securities represent, as much as though they were riveted there by strong iron chains. These workers are but serfs of the field and factory, bound by the pressure of economic wants to compulsory servitude to idle capi- talists. These capitalists are the " Masters of Bread," as Bellamy calls them, to whom the people cry, soliciting to be made their slaves. To-day men are obliged to sell their liberties in exchange for the means of subsistence. The choice of the chattel slave was between work and the lash. The choice of the wage slave is between work- ing for an employer and starvation. Under the modern form of slavery there are many ad- vantages to the slaveholder, the modern capitalist. In fact, he has all the advantages of slavery with none of the responsibilities. He is not troubled with providing for his slaves, or with constant watching lest they escape. 134 PRINCIPLES OF SCIENTIFIC SOCIALISM. The wage slave spends his own subsistence wage, wlac!., under chattel slavery, the owner was obliged to spend for him. This method was fully as desirable for the slave, for the owner, having a stake in the life and health of his slave, desired to keep him in good condition. The modern slave owner, on the other hand, does not par- ticularly care whether his wage slave lives or dies, for he has no economic interest at stake and there are thou- sands of others to take his place. It has been truly said that there were no slave quarters in the United States so vile as the tenement houses of the city slums, where many of the wage slaves are obliged to live. Another advantage of the chattel slave over the wage slave is that the former was always sure of a master, and consequently of his livelihood. One of the greatest curses of modern slavery is the fear of the slave that lie will lose his position of servitude. He well knows that not to be allowed to work for a capitalist master means starvation. Many a wage slave would gladly exchange his freedom to leave his master, for a guarantee that his master would not discharge him. " Yes," it may be said, " all this is true, but there are differences which tell in favor of the modern system. For instance, in chattel slavery the master had the right to lay his hands in violence upon his slaves which the employer does not have." This, indeed, is true. There were many instances where the owner in anger maimed and crippled his servants, but this is insignificant as com- pared with the number of persons who are uselessly in- jured and killed by modern industrial methods. In 1890 the railroad industry alone killed 6,335 persons and in- jured 29,027 in the performance of their industrial duties. The reason for this wanton destruction of life is that money is preferred to human welfare. Dividends are the WAGE SLA VER Y vs. CHA TTLE SLA VER Y. 135 first consideration ! Indeed, chattel slavery was more humane than wage slavery. " Well," says our friend, " admitting your contention here, there is surely one point wherein the modern sys- tem is superior. Under chattel slavery women were often subjected to the lusts of their masters." This can- not be denied ; and surely it is one of the most revolting features of chattel slavery. But how is it to-day ? Are there no women, under present conditions, who are subjected to the lusts of their masters ? Would to God there were not ! But the fact is, there are thousands upon thousands of women, and even young girls, who are so reduced to poverty and obliged to work for such a pittance, that they must sell their bodies to eke out a mere existence. And we find the modern slave owner suggesting this method to the unfortunate as a means of adding to her scanty store. It is easy for many to see the evils of chattel slavery, but they are too near to see clearly the results of the wage system. No, wage slavery has no cause for boasting over its predecessor. The condition of the average worker to-day is as abject and degrading as that of the chattel slave. The modern proletarian is as much a slave as though he were owned in chattel on a plantation in the South. Of what does slavery consist? It consists in the com- pulsory using of men by other men for the benefit of the user. A slave, then, is one who is forced to yield to another a part of the product of his toil. This was the condition of the negro, and it is the condition of the worker to-day. That the workingman is able to change his master while the negro could not, does not alter the fact. The negro was a slave, not because of a certain master, but because he must yield a part of the wealth he produced to a master, and it was of no consequence who the master was. And so with the modern working- 136 PRINCIPLES OF SCIENTIFIC SOCIALISM. men. They may desert one master but they must look up another or starve, and this necessity constitutes their slavery. They, being unable to employ themselves, must sell themselves into wage slavery: The intensity of this slavery depends upon the amount of time which the workers are compelled to work gratuitously for others. Under present conditions, without any command of the means of production, they must labor the greater part of their time for the benefit of some one else. It is thus that the wage-earning class are slaves to the employing class. Laborers may change their masters but they are still at the mercy of the possessing class, and are obliged to compete with one another for a subsistence wage. All that they earn in excess of this living wage goes gratuitously into the hands of others. Thus slavery still exists, although the name has changed. Says John Ruskin, in Fors Clavigera, a book consisting of a collection of letters written by the author to the laborers of Great Britain: "Freeman, indeed'! You are slaves, not to masters of any strength or honor ; but to the idlest talkers at that floral end of Westminster Bridge. Nay, to countless meaner .masters than they. For though, indeed, as early as the year 1 102, it was de- creed in a council at St. Peter's, Westminster, ' that no man for the future should presume to carry on the wicked trade of selling men in the markets, like brute beasts, which hitherto had been the common custom of England,' the no less wicked trade of under-selling men in the markets has lasted to this day ; producing condi- tions of slavery differing from the ancient ones only in being starved instead of well fed : and besides this, a state of slavery unheard of among the nations till now, has arisen with us. In all former slaveries, Egyptian, Algerine, Saxon, and American, the slave's complaint has been of compulsory work. But the modern Politico- VAGE SLA VER Y vs. CHA TTLE SLA VER Y. 1 37 Economic slave is a new and far more injured species, condemned to Compulsory Idleness." This compulsory idleness is, indeed, one of the worst features of modern slavery. It is not necessary to go into details ; all are familiar with the results. The very condition of modern production is a reserve army of laborers which can be drafted onto machines when re- quired and set adrift when the demand slackens. Success in modern industry depends upon the ability to quickly respond to the demand for new products. In the days of chattel slavery capitalist production on a large scale was impossible, simply because it was unprofitable for the chattel slave owner to keep more slaves than he could profitably use all the time. He could not afford a reserve army of labor, for he must feed and care for his laborers whether they worked or not. This difficulty is overcome by capitalism. The wage slave owner has improved upon the old method of property in human beings. He found that it was a useless expense to own workers as chattels, for this necessitated his caring for them and involved a severe loss in case of death. He saw that the same results of slavery could be fully secured by simply securing the means of production. The revolution of modern indus- try, then, gives to the capitalist, without expense, an in- dustrial reserve army, who can only secure employment through his grace. This secures for the employer cheap labor, for laborers having nothing but their labor-power to sell, and consequently being unable to employ them- selves, must compete with each other for an opportunity to earn a livelihood. This is the condition thrust upon labor by competitive industry, a condition which will remain so long as labor is a mere commodity. The laborer must lift himself out of the category of potatoes and beef, turnips and squash. So long as his labor- power remains a commodity which he is obliged to sell 138 PRINCIPLES OF SCIENTIFIC SOCIALISM. to another he is not a free being. He is simply a slave to a master, and from morning to night he is as much a bondsman as any negro ever was below Mason and Dixon's line before the war. The lash of hunger and the whip of the black list, often put on the laborer by capital- ism if he dares to assert his manhood, points the way to misery and suffering for himself and those dependent on him. Slavery is not yet abolished. Slaves are cheaper now and do more work than at any time in the world's history. The very principle of subjection which ruled the chattel slave, rules in the wage system. There can be no freedom or liberty so long as the capitalist sys- tem, with its wage slavery, exists. The private owner- ship of the land and the tools with which to work means, for those not possessing these instruments of labor, eco- nomic slavery. This system must be abolished if free- dom and liberty are ever again to become the watch- words of American workingmen. Americans are prone to prate about their liberties. They have as Carlyle says : " The notion that a man's liberty consists in giving his vote at election-hustings, and saying, ' Behold now I too have my twenty- thousandth part of a Talker in our National Palaver. . . . This liberty turns out, before it has long continued in action, with all men flinging up their caps round it, to be for the Working Millions a liberty to die by want of food; for the idle Thousands and Units, alas, a still more fatal liberty to live in want of work; to have no earnest duty to do in this God's-World any more. What becomes of a man in such a predicament ? Earth's Laws are silent ; and Heaven's speak in a voice which is not heard. No work, and the ineradicable need of work, gives rise to new very wondrous life-philosophies, new very wondrous life-practices ! " This wage system which deprives men of the oppor- WAGE SLA TKR Y vs. CHA TTLE SLA V ER Y. I 39 tunity to work must be abolished. All Socialists are pledged to secure its abolition and the emancipation of labor. They may be called cranks and fanatics, but these appellations have been applied to every reformer in all ages. Remember, it was said of Jesus, " He hath a devil, and is mad; why hear ye him:" This was only the Jewish way of calling him a crank or fanatic. The term " Christian " was given in derision to the early dis- ciples, yet no name to-day conveys greater honor. Do we not see the same thing to-day ? Are not those who wish to abolish wage slavery vehemently denounced by the upholders of our present system ? History is simply repeating itself. The men who stand for the emancipation of the wage slave are often treated with the same contempt and opprobrium as those who declared for the emancipation of the chattel slave. As the chattel slave owner looked upon the abolitionist as a dangerous fanatic, so the wage slave owner looks upon the Social- ist. But right and justice will triumph. Chattel slavery was older than history but it has been abolished. So wage slavery will be abolished, just as soon as the con- science of the people is aroused to its iniquity. Of the three systems of social injustice, chattel slavery, serfdom and wage slavery, the latter will surely be of the shortest duration. The laborers to-day have it within their power to put an end to this vicious order, and they are beginning to realize that the parasitical and exploiting class, who live in idleness by extracting rent, interest, and profit from labor's product, are useless, and exist as mere pensioners on productive toil. Private property in the instruments of production will be as surely abolished as private property in human beings has been. We have done well by abolishing chattel slavery but we will not rest until this equally accursed system of wage slavery is blotted from our land. 140 PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER VIII. RENT AND INTEREST. WE are to consider in this chapter the question of rent and interest. Let us begin with rent. Rent is usually considered in two aspects : first, the rent of land where free land remains; second, the rent where all land is appropriated. Rent in the first instance refers to conditions in a comparatively new country and is usually defined by economists as the difference in the product between the best and the poorest land in culti- vation. Let me illustrate. Suppose in a certain community the best land yields a yearly product of $1,000 and the poorest land in cultivation but $500. The owner of the more fertile land would be able to secure $500 a year rent for the use of his land ; that is, a man without land could as well pay him $500 for its use, and much better, than to take other land whose productivity is but half as great. This $500 rent would enable the owner to live in idleness, it being a reward for his pre-emption of the soil. But if all the land which yields $500 is appropri- ated and a man comes to the community and wishes to remain there he would be obliged to pre-empt land whose productivity, say, is but $100 a year. As the population increases the rent of the other lands will in- crease to the difference between the best and this poorest land which has come into cultivation. The first land owner would be able to secure $900 rent and the second could let out his farm for $400 and so become a pen- RENT AND INTEREST. 141 sioner himself. Now if other proletarians appear, and one is wise enough to invent some means whereby he can increase the productivity of the soil, say, one-half, he can secure a sublet from our first tenant and afford to pay him the full rent of $1000. This enables our first tenant to pay the owner $900 and live upon the $100 himself, it being all he could make by working the farm. But the inventor makes the land yield $1,500 by his im- proved devices, which are soon adopted by all the land- lords and tenants, thus enabling them to increase the rent or sublet their property, and so join the growing class of parasites. But here note that this last increase would have nothing to do with the margin of cultivation. Land being all appropriated rent would be determined, not by what the proletarian could do on land which he might secure at the margin, but wholly on his necessi- ties. As the number of proletarians, who must have access to the land or starve, increases, the share of the product which one will consent to give to the owner in- creases until the amount retained by the worker is barely sufficient to keep body and soul together. But the pro- letarians are still on the increase and as the tenants have not time or strength to exhaust the full productivity of the soil and the proletarians cannot employ themselves, they finally sell their labor-power to the tenants, who are ready buyers, as they are able to make a profit on the labor. The proletarian thus sells himself into bondage. This is the economic condition to-day. Whether the Ricardian theory of the origin of rent is strictly true or not, the fact remains that the land, in all civilized coun- tries, has been appropriated. Thus the private ownership of land is one of the causes of the degradation of labor. No man has a right to the private ownership of land. No man has a right to that which is not the product of his own toil. Land is not the product of human labor. 142 PRINCIPLES OF SCIENTIFIC SOCIALISM. The original titles to all lands rests upon conquest and theft. Because one has bought land and paid for it does not remedy the evil ; the person from whom he bought it had no right to sell it, for the reason that he bought it under like conditions. If a man steals a watch and sells it to another and it passes through a dozen different hands, ownership is not established by the transactions. If some one comes forward and claims the property, and is able to establish his claim, the law returns the watch to the rightful owrer. No reason can be given for the private ownership of 'and which will not apply equally well to the air or sea. No one has a right to the owner- ship of these, because they are not the product of human labor. They are the free gifts of nature. This wrong necessitated by private ownership must cease. Socialism would not allow men through private ownership to longer appropriate the laboi of others. All rent is sim- ply unpaid labor. It is simply a tax or tribute which the owner of the land is enabled to levy upon the wealth which the laborer creates. Doe* the landlord earn the rent ? No. If he owns a farm, the farmer works and raises the crops out of which rerit is paid. If he owns a house, the tenant works for others and earns the money with which he pays the rent. Surely the owner is not entitled to more than will enable him to keep the property intact. All in excess of that rerts upon priv- ilege. The same is true of interest. Interest is money paid for the use of money. But where does interest come from ? Money surely does not grow money ; oire must work for it. The man who receives it does net work for it, although, possibly, he may have worked for the prin- cipal. The point to be noted is, that interest, like rent, is not earned by him who receives it. The ownership of money, like the ownership of land, gives to the possessor REN T A ND INTERES T. 143 the privilege of taxing the labor of others. No one has a right 10 rent and interest, because it violates the fun- damental principle upon which the right of all property rests, that of individual labor. There have been many theories put forward, by the apologists of the present order in behalf of interest. Four reasons are usually assigned in justification of the same. 1. Wages of superintendence. Certainly if a capitalist performs tne functions of superintending and so becomes a labojer. he should receive compensation for his labor performed. The remuneration, however, is a reward for labor, and has nothing to do with interest. The capital- ist has simply combined his office of capitalist with that of superintendent, and so can legitimately claim a re- ward for his effort like any other laborer. But this in no way accounts for what he appropriates as capitalist. A capitalist is a man who possesses wealth which brings him in an income without personal exertion. A capital- ist, as such, is a mere interest receiver. Most of the businesses of to-day are in the form of joint-stock com- panies where the stockholders cannot even put up the claim of superintendency. The individual capitalist owns stock in a score of concerns in various trades and at different places, trades of which he knows nothing and in places where he has never been. Economists must be hard pushed when they try to excuse interest on the supposition of wages of superintendence. 2. Compensation for risk. This is often put forward as an excuse for interest. Suppose a man puts $10,000 in the bank. Is his interest payment for risk ? Hardly ! In fact he places his money there just because he believes it the very safest place to put it. Neither is the excuse valid in reference to money invested in business enter- prises, for the gains of the capitalists far exceed their 144 PRINCIPLES OF SCIENTIFIC SOCIALISM. losses. Those who put forward this apology for interest overlook this fact and argue as though there were but one capitalist concerned. But in considering the ques- tion of interest we must consider the whole class of in- terest receivers, and when we do this we find that the aggregate profit is immeasurably more than the aggre- gate loss. Consequently, from the standpoint of risk, there is no reason why this class should be compensated by the payment of interest. As a class they run no risk and suffer no loss. 3. The reward of abstinence. This is another effort on the part of our friends to excuse this injustice. Inter- est is called the reward of abstinence, but one cannot help feeling if the man did not have his $10,000 in the bank, he would have to be more abstinent than he is now, and no one would think of rewarding him for it. This point is well brought out by Mr. Ruskin in Fors Clavigera, after which he says : " Abstinence may, in- deed, have its reward, nevertheless ; but not by increase of what we abstain from, unless there be a law of growth for it, unconnected with our abstinence. ' You cannot have your cake and eat it.' Of course not ; and if you don't eat it, you have your cake ; but not a cake and a half." 4. Payment for services rendered. This is the principal reason given for rent and interest, so I have reserved its consideration until the last. That this apology, like the others, is without foundation, is evident from the fact that the service rendered is reciprocal. It is a question who renders the greater service, the lender or the bor- rower. Capital will soon decay unless in productive use. The borrower is necessary as a preserver of capital. The laborer keeps capital intact by perpetual reproduction. If a man allows his factory, machine, or land to remain idle it soon deteriorates. It is only by perpetual repro- RENT AND INTEREST. 145 duction that capital is preserved. Were labor to with- draw from the field, the fortunes owned by non-pro- ducers would soon diminish. Laborers, then, by taking capital and keeping it intact, render as great a service to the capitalist as capitalists do to laborers. There is no more reason that laborers should pay the capitalists than that capitalists should pay the laborers, nor as much. Of the two, the laborers could get along much better with- out the aid of the capitalist's money, than the capitalists could without the- services of the laborers. None of these reasons given are satisfactory. They are evidently designed to patch up the present contradic- tory system of economics. Socialists give the only true reason for interest, and also point out how the custom came to be regarded as legitimate. In the Bible, interest, which is called usury, is regarded as a great evil. It was forbidden Israelites in their deal- ings with each other and, in the case of poverty, it was forbidden even to strangers. In Leviticus xxv. 35-37, we read : " And if thy brother be waxen poor, and fallen in decay with thee ; then thou shalt relieve him : yea, though he be a stranger, or a sojourner; that he may live with thee. " Take thou no usury of him, or increase : but fear thy God ; that thy brother may live with thee. ; ' Thou shalt not give him thy money upon usury, nor lend him thy victuals for increase." Interest, then, was originally looked upon as sin. Why is it that interest has come to be regarded as legitimate ? The answer to this question is to be found in the purpose to which money is put. Money to-day is borrowed for the purpose of engaging in some business. It enables its possessor to establish an industry, and thus becomes a means of exploiting labor-power. If a man borrows money for the purpose of making more money it is but 146 PRINCIPLES OF SCIENTIFIC SOCIALISM. fair that he should pay for its use. This is the reason thai interest has come to be regarded as proper. The direct employer of labor, the " captain of industry," is the man to whom the money-lender renders service by enabling him to extend his operations, and obtain larger profits by the use of the borrowed capital. If a man by bor- rowing money is enabled to become an exploiter of labor, he ought, of course, to divide the spoils. Interest, under such conditions, is but a fair division of the booty. The whole process, however, is an outrage upon labor, but so long as capital remains in private hands the evil will ex- ist. Interest is simply a tax or tribute which the owners of capital are enabled, either directly or indirectly, to levy upon productive toil. Both interest and rent are the remuneration of private ownership in the instruments of production, and will disappear when these instruments become social property. Interest and rent are eating up the wealth of the nation. The laborer is obliged to surrender to these robbers, rent and interest together with profit, all the product he creates except the barest necessitates. Here note that landlords and capitalists working under this anarchical system are not to be too severely censured. It is the system that compels injustice and should be abolished. Even should the individual 'andlord or capitalist desire to rectify the evils from vvhich we suffer, he would be powerless. He might take less rent or a lower rate of interest, but in capitalist pro- duction this would only benefit the employing capitalist who would thus be able to keep more of the appropria- tion himself. As far as the laborer is concerned it is of no matter whether his surplus labor is all pocketed by the employing capitalist, or whether the latter is obliged to divide up, under the name of rent and interest, with third parties. It is the private ownership of land and capital that enables their owners to get their respective shares RENT AND INTEREST. I v , from the surplus-value which the employing capitalist has extracted from labor. The Socialist recognizes the source of this appropriation, and so does not expect nor advocate the abolition of rent and interest so long as the present system continues. To advocate, as some do, the abolition of rent and interest, and, at the same time, the private ownership of land and capital is absurd. Even were it possible it would be of no particular benefit to the industrial laborers; it would simply mean that the em- ploying capitalist could get the means of exploitation without cost, and so could pocket the whole surplus him- self. But rent and interest are part and parcel of the private ownership of the means of production, and will remain so long as these instruments are privately owned. When land and capital become collective property, rent and interest, as well as profits, will naturally and neces- sarily disappear, and labor will receive the full product of its toil. 14* PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER IX. THE LAW OF WAGES. A SCIENTIFIC law of wages must afford an explanation of all wage phenomena. The term wages has no mean- ing except under wage conditions ; that is, under condi- tions where the laborers receive a stipulated sum for their services. If a man works for himself and sells or consumes the product of his labor, that which he re- ceives would not be wages, but the result, earnings, or proceeds of his labor. But the man who works for an- other does not own the product of his labor, but receives for his services a stipulated sum which has little or nothing to do with the product. These two instances are governed by entirely different principles. In one case the man works for himself and receives the whole product of his labor; in the other he works for an employer and receives only the value of his labor-power, which is properly called wages. We must not confound these two kinds of income, one of which is contingent, the other stipulated. By wages is meant the value of labor-power, and there can be no wages unless labor-power is bought and sold. The law of wages, then, is the law of the economic value or price of labor-power. We cannot be too careful in the use of this term " wages." It is a technical term and signifies in eco- nomics that portion of the product of labor that the capi- talist allows the workingman to keep. It is that portion of the laborer's product which capital does not fleece THE LA W OF WAGES. 149 from him. By a strict use of this term many of the dangers in economics will be avoided. As labor-power is a commodity and wages but the price of labor-power, the rate of wages will be governed by the same law which governs the price of all commodities. We have seen in the preceding chapters that prices are regulated by the average cost of production. The value of a commodity, which, under normal conditions, deter- mines prices, depends upon the amount of social labor- time embodied in it. Its cost of production is the aver- age cost, or average amount of social labor, which is necessary for its production or reproduction. So the value of labor-power is determined, as with every other commodity, by the labor-time necessary for its produc- tion or reproduction. As labor-power is but a capacity of the individual, its production presupposes his exist- ence and, consequently, the production of labor-power consists in the production or maintenance of the laborer. Hence the exchange-value of labor-power (its price) is the value of the means of subsistence necessary for the .laborer's maintenance, and this will vary with the value of these means, or with the quantity of labor necessary for their production. These means of subsistence imply not only the physical requisites, but also such other needs as are required to maintain the laborer in health and strength of both body and mind and enable him to maintain himself in his normal state. But as the laborer is mortal, the means of subsistence must suffice to en- able him to perpetuate himself, to maintain his family, and raise children to take his place when he has gone. Ricardo says : " The natural price of labor is that price which is necessary to enable the laborers, one with another, to subsist and to perpetuate their race, without either increase or diminution. . . . The natural prict of labor, therefore, depends on the price of the I$0 PRINCIPLES OF SCIENTIFIC SOCIALISM. food, necessaries, and conveniences required for the sup- port of the laborer and his family." These necessities vary in different countries and at different periods, but as Marx says, " In a given country, at a given period, the average quantity of the means of subsistence neces- sary for the laborer is practically known." Let it be remembered that in economics when we use the term " law " it is used to signify general tendencies. By law of wages we mean the law which determines the tendency of wages to move in a given direction. As al- ready seen, the law of wages is that, under normal con- ditions, the price of labor-power (wages) always tends toward the cost of producing labor-power, the laborer's maintenance. The cost of the laborer is the cost of his living and, other things being the same, his living is de- termined by the number of his habitual needs. Here, note, that wages, as affected by demand and supply, rises and falls, above and below a certain level. But when supply and demand balance this oscillation ceases. When this equilibrium is established, then the price of labor-power is its real value. These oscillations, under normal conditions, during a period of time, say, one year, compensate each other, thus leaving an average magnitude. To be sure the price of labor-power may fall below this level, but if it does it falls below its value. As Marx says: " If the price of labor-power fall to this minimum it falls below its value, since under such cir- cumstances it can be maintained and developed only in a crippled state. But the value of every commodity is determined by the labor-time requisite to turn it out so as to be of normal quality." I wish in passing to call your attention to the fact that this normal quality of labor is constantly depreciating* that is, less and less skill and ability are required of the laborer. In modern production skilled labor has been 'THE LAW OP WAGES. 151 replaced by unskilled, men by women, and women by children. The skill and dexterity of the workman has been transferred to the machine. This reduces the qual- ity of the labor-power required and depreciates its value in like proportion. It is thus that the value of labor- power is falling toward the minimum limit, the limit of bare subsistence, the means of subsistence that are physi- cally indispensable. That this is the law of wages may be seen by even a superficial examination of facts. We find that a per- manent change in the cost of the means of subsistence, or cost of living, is always followed by a corresponding change in wages. If, however, the change in the cost of living be sudden and artificial, it does not follow that wages would immediately change in the same ratio, but they would begin to move in that direction, and if the rise or fall become permanent, the wages will finally be adjusted to them. We see, then, that variation between wages and the cost of living cannot become permanent; they are merely accidental, and exist only so long as is necessary for wages to become adjusted to the new prices. Thus wages rise when prices rise, and fall when prices fall. The economic history of the i6th, I7th, and 1 8th centuries evidences this fact. Although nominal (money) wages rose more than fourfold, there was no rise in real wages : i.e., the social well-being of the la- borer. The reason why wages always lag behind prices is, that the former is less susceptible to sudden influences or artificial causes. So true is this that we often see prices rise and fall again without any change taking place in wages. That wages are determined by the cost of living is evident upon every hand. This law furnishes an ex- planation of the variations in different industries, locali- ties, and countries, as well as different periods in the 152 PRINCIPLES OF SCIENTIFIC SOCIALISM, same country. It is well known that wages in the same industry are higher in cities than in towns, higher in manufacturing industries than in agriculture, higher for men than for women. The reason for this is the differ- ence in the cost of living in these different localities and among the different classes. It is well known that the scale of wages in New York City is higher than in Yonkers. Why ? Because living is cheaper in the latter place. Rents are lower and wages drop accordingly. If we examine the wages per day paid to masons, carpen- ters, and factory hands in the same locality, we shall find a great difference. While their cost of living is about the same, the former are exposed to the weather and work fewer days in the year, consequently, while the rate per day is higher, their actual income per year is about the same. So if we were to examine the wages in differ- ent countries we should find the same law holds true In India and China we should find the daily wages but 6 cents to 10 cents, because this is sufficient in these countries to furnish a living. Much more evidence might be adduced in support of this law, but this must suffice. This law, that wages are governed by the cost of pro- duction, is scientific, because it explains all the facts, and there is no other theory of wages that meets this scientific test. Here we come to an important point that needs to be noted. We have found that the general rate of wages is determined by the cost of living, and this cost refers, not to the single individual, but always to the family. But this does not mean that the wages of the worker in each family are determined by that particular family's cost of living. Were the individual standard the cost of living of each family to determine wa^es, there would be no general rate of wages in any class or in- dustry, because the various expenditures of the family THE LAW OF WAGP:S. 153 would cause a variation in the income of the family, thus making the expenditures of each family a law of wages unto itself. It is evidently not the individual cost, but the social or average cost per family, that determines the standard. In other words, it is the social standard the average cost of living and not the individual standard, that regulates wages. As in the production of commodi- ties, it is the social labor and not the individual labor that determines values; so in the production of labor- power, it is the social standard of living not the individ- ual standard that determines wages. The same law gov- erns both wages and prices ; both are determined by the social cost of production. This explains why men of various trades working under uniform conditions get the same pay, whether they are married or single, have large or small families, are penurious or extravagant. It also explains why families which are the largest and have the highest tastes, whose individual cost of living is higher than the average, are constantly chafing under the pressure of unsatisfied wants, while the single man, or man of small family and few wants, whose individual cost of living is lower than the average, can save money. Thus, under normal conditions, when demand and sup- ply are equal, wages are governed by the cost of produc-' ing, not the most expensive or the least expensive por- tion of the supply of labor-power, but by the average labor-power of the workers of a given class. Again, this law explains why the Asiatic or European laborer can come to this country and accumulate wealth upon wages which will supply the American family with only bare necessities. The reason for this is that the foreigner's standard of living is below the social stan- dard of his class here, and, as he is able to secure wages based upon the social standard in this country, he is able to save money. He could save nothing in his own coun- 1 54 PRINCIPLES OF SCIENTIFIC SOCIALISM. try because wages there were not in excess of the social standard of living in that country. There is no margin for Chinese labor in China, for German labor in Ger- many, for English labor in England, or for American labor in America. But when a Chinaman goes to Ger- many, or a German to England, or an Englishman to America, each finds a margin because each goes to a country where the standard of living is higher than his own. But if the order were reversed, the American going to England, the Englishman going to Germany, and the German going to China there would be no margin. In each country the average cost of living constitutes a social standard, or socially accepted standard, of living, and this, at any given period, regulates the rate of wages. It is the social standard of living that regulates the gen- eral rate of wages, and wages regulate the individual standard of living. When the standard is established, the price of labor-power, being affected by demand and sup- ply, will vibrate above and below its natural value. If the supply is excessive, the price of labor-power, like other commodities, falls, and if the supply continues in excess of the demand a new social standard will be established around which, as from a centre, the price of labor-power will oscillate. The value of labor-power both rises and falls in accordance with this law. The Black Death which swept over England in 1348, carried off, as esti- mated, one-third of the laborers. Wages immediately arose in accordance with the law of demand and supply This scarcity of labor continued for some time and en- abled the laborers, by means of their increased wages, to raise their individual standard of living, which soon became general, and the social standard became adjusted to this higher level. When this social standard was thu raised and established the laborers were able to maintain THE LA W OF WAGES. I 5 5 it for some time after the scarcity of labor had disap- peared. But before long the increased supply of free la- borers, caused by the disbandment of the feudal retainers and the expropriation of the peasants, wrought the downfall of labor. Such has been the working of the law of wages in every age. History is again repeating itself. Since 1872 wages have been gradually falling. The supply of laboi greatly exceeds the demand and the opportunity for self- employment is becoming more and more limited. Undei such conditions the price of individual labor-power is constantly forced below the social standard. When a sufficient number of laborers are forced by competition to accept a lower standard of living, then the social stan dard becomes adjusted to the lower level and a new basis is established which, in turn, becomes lowered, and so the process continues, ever approaching the point of bare subsistence. The same law applies here as in the price of commodities. Prices are determined by the social cost of production. Individual manufacturers may be able to reduce their cost of production, but it is only when their methods and appliances become general that the social cost is affected. When such is the case the social cost is adjusted to the new level. The individual standard now becomes the social standard and a new basis is established. Labor under present conditions is governed by the same law. Of course, there are excep- tions, as in a new country and with individuals of ex- ceptional ability, and when skilled laborers have been able by virtue of unions to thwart, for the time being, the working of the law.. The restriction, however, is only temporary. Statistics show that the wages of the un- skilled laborers always tend to the level of bare subsis- tence. This is inevitable under present conditions. The evil is inherent in the wage system. Capitalism necessi- I 56 PRINCIPLES OF SCIENTIFIC SOCIALISM. tates this law. Says Rodbertus : " The workingman brings on the market a perishable merchandise, namely, his labor. If he have neither land nor capital to employ his labor, he must offer it to those who can make use of it. How much will they give for his services ? " Forced by competition to produce at the least pos- sible cost, they will give no more than what is strictly necessary, but what is -strictly necessary is what is needed to enable the laborer to subsist and to perpetuate his kind." The capitalist is not to blame for this condition. He must produce in competition with others and so must secure his laborers at the lowest possible wage upon which they can live. It is this fierce competition among laborers which compels them to accept the wages of bare subsistence. Says Dr. Gladden, " A bare support is all that the economical forces, working' unhindered, will guarantee to the laborer. So long as competition is the sole arbiter of his destiny, that is about all he will get." Were it necessary we could point out the suffering that exists among the working classes to show that Dr. Glad- den is right. This, however, is unnecessary, for the suf- fering and deprivations of the working classes are famil- iar to all. When, as to-day, capitalism has developed tc the extent that nearly all the means of production are monopolized by a few, and laborers are thus unable to employ themselves, the laborer's standard of living, both social and individual, continually moves toward the level of bare subsistence. If the supply of labor is scarce, the price of labor-power will not fall to this level, but in- crease the supply and its price, as that of any other com- modity, will fall. Many have misunderstood the phrase " standard of living." Some have supposed it referred to the wants or desires of the laborers, instead of to the social stan- THE LAW OF WAGES. 157 dard of necessities and needs. Were this true laborers could fix their own wages regardless of capital and se- cure any rate they might desire. Suppose one holding this theory were to present himself at the office of a corporation and apply for work. Would he be asked as to how well he would like to live and paid accordingly ? Suppose he decides that he must have $5.00, and so in- forms the employer. He would be told that any num- ber of men could be had who would be glad to fix their standard of living at $1.00 a day and even less, and that he could take that or go elsewhere. The theory that laborers can fix their standard of living where they may choose is so preposterous that it is strange that any man clothed and in his right mind could deliberately set it forth. This, however, is the theory of Mr. George Gun- ton. Read the records of labor struggles, of strikes, and of lockouts. How often does labor succeed ? Read the records of wage reductions which are continually going on. Why do the laborers, in so many instances, submit to this injustice, if they have the power to estab- lish their standard of living ? Surely no one will claim that laborers willingly submit to wage reductions which necessitates a lowering of their standard of living. Laborers, under the present system, are absolutely de- pendent, their wages being determined by the cost of living, and any perfection in mechanical appliances by which the cost of the necessities of life are reduced one- half, will ultimately result in reducing wages in like pro- portions. When the supply of laborers exceeds the de- mand and laborers are unable to employ themselves, as to-day, the price of labor-power, and consequently, the standard of living, constantly falls toward the necessary cost of living. The standard of living, then, never refers to the wants of laborers, but to their average needs and necessities. 1 58 PRINCIPLES OF SCIENTIFIC SOCIALISM, A laborer may desire to have porterhouse steak, turkey, and chicken salad every day in the week, and to dress in broadcloth on Sunday, but his wages are what deter- mines his individual standard of living, and not vice versa, and he is thankful if he is able to secure even shoulder steak and a half respectable suit of shoddy clothes. If a man resides in an old rookery and lives on the coarsest of food it is because of necessity. Give him a position where he can earn $100 a month and see how quickly he will raise his standard of living. He will at once move into a decent house and supply his table with palat- able food. But so long as labor-power remains a com- modity we can hope for no improvement. Note the working of the present order. Suppose, for instance, in a factory employing one hundred men, machines are introduced which enable ten men to do the work previously performed by one hundred. This elimi- nates ninety workmen. These ninety men now seek em- ployment elsewhere, but machinery has been introduced in other lines and similar conditions prevail. After a time some of these return and offer to work for less than the ten who were retained, and so secure their jobs. The ten who were underbid now start out in search of work, but finding none, they also return and offer to work for the capitalist for still less and are re-instated. Thus the competition goes merrily on until wages are reduced to the point of bare necessities. Thus the price of labor- power continually falls below the social standard, and this at last necessitates a lowering of the standard itself. If laborers could secure their own price there would be no labor problem. But the fact is, thousands upon thousands are continually out of employment, and for every desirable job there are from ten to one hundred standing in waiting. Laborers are cognizant of this THE LAW OF WAGES. 159 fact, and so submit to every form of suppression and oppression. Look at the miners who work for 42 cents a day; the cotton operatives who labor for $5.40 per week; the sweatshop workers who receive for cambric dresses, waists lined and trimmed, $1.20 a dozen; night- gowns, with embroidery and tucked yokes thread fur- nished and embroidery cut out by maker $1.00 a dozen ; silk waists, 98 cents a dozen ; woman's wrappers, 40 cents a dozen; shirts, 30 cents a dozen; neckties, $1.35 a gross ; knee-pants, 50 to 75 cents a dozen ; vests, $1.00 to $3.00 a dozen; trousers, 12\ cents to 75 cents per pair; coats, 35 cents to $1.50 each, percentage off for boss sweaters and deduction for cost of cartage. (See October North American Review. 1897.) Is it possible that these laborers have deliberately chosen to work for such starvation wages ? Do you not think that they would prefer a higher standard of living than such wage remuneration allows ? According to some they have no one but themselves to blame ! They could fix their standard of living higher and demand double or triple pay to meet it ! To hear some people philosophize one would imagine there are a dozen em- ployers after each workman. If such people would go out in search of employment they would find, unless they went unusually early, a dozen applicants ahead of them. Let no one be deceived by such false philosophy. The laborer has trials enough already without inveigling him into a useless conflict with capital. So long as capital- ism continues, capital will be king. Let no laborer be foolish enough to image that he can enjoy the privileges and comforts of the capitalist by simply desiring to raise 'his own standard of living. He might, in his endeavor to gain that end, go on a strike or in search of work elsewhere, but he would return a sadder and a wiser man. l6o PRINCIPLES OF SCIENTIFIC SOCIALISM. He would learn that which thousands have learned, that under the wage system the laborer is absolutely de- pendent upon the owner of the instruments of produc- tion. Let laborers unite and strike at the ballot-box for liberty. Vote into effect your demand for the abolition of wage slavery. Wrench by united political action, the power of government from the hands of the capitalist class, that you may put your economic programme into effect. The great Socialist movement which seeks to establish the Co-operative Commonwealth is the only economic salvation. There is no hope for labor under the wage system. What we want is the abolition of wages. We wan/ the entire product which we produce. THE LA W OF PROGRESS. CHAPTER X. THE LAW OF PROGRESS. IN order to understand the law of progress it is neces- sary for us to briefly trace the history of human develop- ment. On the lower planes of existence we find the law of the survival of the fittest mercilessly at work. This is the law of the vegetable and animal kingdoms, and when we come to deal with man in the old days of bar- barism of the lowest type, we find substantially the same natural law the battle for life and the survival of the fittest at work in all its rigor. But after a time we note a change. We begin to dis- cover the working of another law the law of human selection mightier than this law of natural selection ; human love, human sympathy, and human tenderness have begun in a crude way to manifest themselves and to modify the law as it works among the unconscious forces of the world. A man loves a woman with a half- barbaric affection and takes her unto himself. From henceforth he battles not alone for his own personal ex- istence, but for hers also, and so the selfishness begins to blossom into that which is unselffish. Presently chil- dren are born, and the group is bound together by ties of love and sympathy. Here we see the birth of the principle of helpfulness. Within the family antagonisms are allayed and harmony attained. The germ of civiliza- tion here manifested is the result of the operation of altruistic forces. Next the family enlarges and becomes a patriarchal 1 62 PRINCIPLES OF SCIENTIFIC SOCIALISM. tribe. Although there may be a feeling of antagonism (competition) toward other tribes, still, within the limits of this group, there is a certain degree of sympathy and helpfulness. All progress here is due to the altruistic principle which has restricted the law of natural selec- tion. The very beginnings of society were due, as we have seen, to the introduction of this higher law. It lies at the basis of the family, which is the unit of society. Finally, the tribal organization is changed for a ter- ritorial one. From now on not only the people bound together by ties of kinship, but all within certain terri- torial limits, are looked upon as one people, and it is this one people against the world. Progress has thus been attained just in proportion as antagonisms and conflicts have been allayed. As these organizations enlarged there entered into the mind and heart of the noblest a dream of humanity and we have Tennyson's ideal, " The Parliament of man, the Federation of the world." This is still an ideal, for neither politically, socially, nor industrially, have we risen to its realization. Now, note, human progress has been the result of human growth the unfolding of the distinctively hu- man qualities, love, tenderness, and sympathy. Had the law of natural selection been given full play on the human plane, there would have been no civilization ; there would have been no humanity even, in the higher sense of the word, on the face of the earth. Says Prof. Herron : " Competition is in fact the negation of society ; and such society as we have exists through the restric- tion of competition. The evolution of society is the elimination of competition through the progressivf in- troduction of altruistic forces." * Altruism, then, has > The Christian State, Herron, p. 89. THE LA W OF PROGRESS. 163 been the law that has made for civilization. While com- petition has been the condition of much of the struggle for life it is not its law. Progress means the subjuga- tion of conflict, effected through the development of the higher law of service. There would have been but little progress had men not united their efforts for the com- mon weal. The true principle of society is co-operation, and civilization is measured by its attainment. Says Prof. Parsons: "The whole history of human advancement is simply the- story of getting rid of con- flict. At first every man fought for himself, then groups co-operated in war, then nations, groups of nations, and at last the world, and war will be over, at every step a larger union, and the elimination of internal conflict over a wider area. It is the same with industry, at first individual workmen, then groups in factories, then corporations, syndicates, trusts, and at last a union of ALL in one great co-operation for the benefit of all, at every step a larger union and the elimination of conflict within its borders, at last an all-including union and the ' extinction of conflict. If conflict is the essential means of advancement, the whole history of civilization has been simply a closing of the rates of progress, and we ought to get rid of the mischief at once, and go back to barbarism with all possible speed." * Rev. M. J. Savage, in speaking of the conditions of human progress, says : " If you place yourself in the condition of early man, you will find that the first step that he needed to take was to learn how to combine. One man alone is helpless. Men organized and co- operating sympathetically together are able to subdue the earth. . . . The problem of progress will be found in the case of man, just as in the case of a tree, when * Our Country's Need, Parsons, p. 188. 164 PRINCIPLES OF SCIENTIFIC SOCIALISM. there is cohesive power enough to hold together and expansive freedom enough to permit growth. What man needs in politics, art, science, religion, everywhere, is to learn to love and worship and care for this prin- ciple of co-operation, so that men can combine, but to hold it loosely enough so that there can be growth." 1 All progress is simply a growth, an advance from the simple to the complex. The lowest barbarian, standing at the farthest border that separates manhood from the animal world, was the seed, the potency of all that the world has become. But in order for this potency to develop, as with the seed of the flower, there must be soil, sunshine, rain, and opportunity. While there is no necessity for the growth of any' one particular individual or nation, there is a necessity for the growth of the race. To illustrate, let me again recur to the flower. There are so many conditions favorable to plant life, and so many seeds, that we say it is a necessity that plant life should exist. But there is no necessity for any particu- lar plant or for any particular variety, to exist. And so with the race. It must live and go on, although it is not a necessity that any particular individual or nation should continue to develop. But necessity compels the growth of the race; it is progress or death. Mankind, of course, has not progressed with equal steps through all the ages. There have been periods when the race has seemed to be standing still ; but even then it has often been gathering increment of power, so that when the time was propitious it blossomed, as it seemed, spontaneously, into great advance and enlarge- ment of life. The very fact that progress is spiral has hidden the real law from view. Nations, like individuals, are born, develop, grow old, and die. But this attain- * Btlufs about Matt, Savage, pp. 92, 93. THE LA W OF PROGRESS. 165 ment is not lost ; it passes over and is carried on by other nations just beginning their life cycle, the same as the knowledge and achievements of one individual are pre- served by another. There is, then, a necessity for the ad- vance of the race as a whole. Now, what is the force at the heart of humanity that constitutes the eternal impetus toward progress ? As at the heart of the seed so at the heart of man, there is an endless thirst to become more, to reach out on every side. There is a mental and spiritual hunger and thirst in man to be more than he is although he knows not why. All progress means trusting this hunger and thirst, and opening the field for its realization. This ten- dency to develop being given all that is needed to secure its attainment is opportunity. We should take heed that no obstacles are placed in the way, and that no false theories shall lead us astray. One of the primal factors of all progress is right condi- tions, the soil. Is the competitive soil propitious for the attainment of this end ? Let us examine some of the legitimate results of the workings of the competitive principle. This principle of competition, with its inherent greed and selfishness, is the cause of much of the oppression and suppression that have cursed the modern world. It begets antagonisms, cruelty, injustice, cunning, and selfishness, and undoes that which religion and ethics have been toiling to do. It violates the law of love, sac- rifices manhood to material wealth, and engenders ser- vility, hatred, untruthfulness, trickery, and despotism. It develops all that is combative, unscrupulous and un- sympathetic in man and begets improvidence, reckless- ness, intemperance, and illiteracy. It ruins the lives of millions with needless preventable disease and poverty, and hinders the development of brotherly love, sym- 166 PRINCIPLES UF ^UENTIFIC SOCIALISM. pathy, and helpfulness. It grants the highest prizes to the greatest wrongs, thus undermining virtue by placing a premium upon dishonesty. It makes of all business one vast scheme of speculation and fills all mercantile transactions with deception. It results in the wholesale adulteration of nearly all food products, and in general has made commodities dearer. It produces, by its an- archy of production, periodical crises and industrial de- pressions with their attendant want and misery. It robs the people of needed leisure and suppresses the impulse of creative genius. It results in the monopolization of the means of production and the reduction of the great majority of laborers to a condition of wage slavery, and exploits them out of four-fifths of the wealth they create, thus giving millions of dollars to non-producers while millions of workers are reduced to the verge of starva- tion. It fills this glorious country of ours with thous- ands of paupers, thousands of tramps, and thousands of suicides. It wastes at least five-sixths of the productive forces of the world and has caused strikes and lockouts which have cost millions upon millions of dollars. It creates in some a feverish force which re- sults in nervous exhaustation, while it leaves the great mass devitalized of energy by depriving them of all in- terest in their work. It condemns the vast number to poverty and want and bequeaths to their children a legacy of misery and sin. It destroys liberty, indepen- dence, and individuality, and makes the workman de- pendent on the will or whim of a master. It has produced a host of parasites who live in luxurious idle- ness off the results of productive toil. It turns machin- ery, which is designed to be of service to man in lighten- ing his toil, into a lever for the aggravation of his servitude. It causes great economic loss from the insuf- ficiency, indifference, and want of adaptation of labor. THE LA W OF PROGRESS. 167 It results in enormous wastes from ignorance, luxury, useless duplications, needless stores, manufactories, prisons, banks, insurance houses, employers, clerks, book-keepers, salesmen, agents, jobbers, speculators, ad- vertisers, drummers, lawyers, police, etc. It enables some to become owners of the machinery of production, which involves ownership of the men who must use that machinery or starve, thus making wage slavery more profitable than chattel slavery, as the capitalist secures all the advantages of the ancient system and escapes all the responsibilities. It begets national rivalry, and engenders enmity, strife, and hatred, which is becoming more desper- ate with the development of capitalism. It makes the chief function of government to build implements of destruc- tion, whereas the true function of government is to pro- mote the welfare of mankind. It causes the disintegra- tion of family life and drives wife and children into the factory to help in the maintenance of their humble home. It fills the records with failures and bankruptcies. Finally, it has so distorted civilization that nine per cent, of the population now own seventy-one per cent, of the wealth. It would seem, then, that competition instead of pro- moting progress and civilization, has distoited them at every turn. The fact that civilization in many ways is but little more than veneered barbarism is due to this ruling principle. While in certain directions we have made great progress in spite of this Satanic principle, God only knows what we might have attained had con- ditions been favorable. We cannot hope that the high- est development of the individual, the loftiest aims of hu- manity, or a true state of civilization will ever be realized so long as this brute force of competition is the ruling (actor of our economic life. We have become so accus- tomed to the antagonisms and incongruities of our com- 1 68 PRINCIPLES OF SCIENTIFIC SOCIALISM. \ petitive system that these anomalies do not affect us. But what could be more surprising to an inhabitant of some other sphere, utterly unfamiliar with our industrial methods, than our present economic order. The things of every day which we pass over with placidity would seem inconsistent enough to him. How can we hope for peace and harmony in the industrial realm, where the very basis of the order is strife and warfare ? And how can we expect the best results to be attained under a system of antagonisms and conflicts ? If the purpose is to secure the largest results from the least expendi- ture of human force, then our system stands convicted of imbecility. Given a country and a people, how can the problem of great results be best solved by competition or co-operation ? Can it be that a nation in which every man tries to get the better of every other man, will be happier, more prosperous, and more civilized than a nation in which every man tries to help his fel- lows ? It is but axiomatic to say that men will accom- plish more when they unite their efforts for a common end, than when they proceed in an unorganized and hap- hazard manner. " In union there is strength." History evidences the truth of this proverb. It is as true in eco- nomics as in any other field of human activity. It is only by united effort that real progress is attained. This lack of concert is the one thing most conspicuous in our industrial order. Is it any wonder that under the hap- hazard play of private enterprise, we frequently suffer paroxysms in the economic world ? The greater won- der is that the complicated mechanism is able to run at all. Says William Morris : " You have often been told that the competition, which is at present the rule of all pro- duction, is a good thing, and stimulates the progress of the race; but the people who tell you this should call THE LA W OF PROGRESS. 169 competition by its shorter name of war if they wish to be honest, and you would then be free to consider whether or no war stimulates progress, otherwise than as a mad bull chasing you over your own garden may do. War or competition, whichever you please to call it, means at the best, pursuing your own advantage at the cost of some one else's loss, and in the process of it you must not be sparing of destruction even of your own possessions, or you will certainly come by the worse in the struggle." 1 The great corporations and trusts have learned the folly of competition and have abandoned it for the principles of Socialism co-operation, co-ordination, and unifica- tion. Experience has taught them that their common end, the attainment of profits, can best be secured by combination. When society becomes truly civilized all its members will cease competing with one another and will unite their efforts for the common good. With the elimination of industrial conflict the conditions of prog- ress will be realized. Says Prof. Herron : " Men are ceasing to believe, and can no longer be persuaded, that a condition of rivalry, in which they are supposed to act from an enlightened self-interest, is the real ground of social order and progress. The civilization that now builds upon the assumption that men are antagonists, and not members of one social body, is fundamentally anarchical against the divine course of things." 2 The whole story of progress is summed up in the two words Manhood and Mutualism. These have been the most efficient means of accomplishing human desires and even the production of material wealth. Any theory that fails to recognize that these qualities should he the i William Morris, Lee, p. 138. The Christian State, Herron, p. 19. I/O PRINCIPLES OF SCIENTIFIC SOCIALISM. supreme product of a nation's industries is pernicious. Our present industrialism aims only at merchandise, for- getting that intelligence and heart are the most impor- tant factors in utilizing the means of production. It thus defeats its own purpose, even in the realm of material progress. Material gain, to the vast majority, is thwarted by this very principle of competition. Com- petitive industry means that laborers are deprived of the opportunity of employing themselves, and so must sell themselves into wage slavery. Such a system is inef- ficient as a wealth producer, it furnishes no motive to in- dustry. On the other hand, co-operation would be effec- tive. Under co-operation the income of each would depend upon the social product. It would then be to the interest of every man to be as productive as possible, for the larger the product the more each worker would receive. In the days of individual production, men were diligent because the result depended upon their industry. and the same would be true under Socialism, for men co-operating would receive the full product of their labor. The larger the product the greater the means of satis- fying their wants. Inasmuch as individual income and well-being would depend upon one's own zeal and the zeal of others, every laborer would be watchful that none shirked his duty, for self-interest and justice would de- mand that each should render a just labor energy for his share of the product. We need only to study the history of co-operation and profit-sharing, where indi- vidual income depends upon the social product, to find that Socialism would greatly increase the motive to ex- ertion. Thus fro^n the standpoint of material gain, Socialism would be a more effective motive to industry and a greater stimulus to progress than the present system. But love of gain, although perfectly legitimate so long THE LA W OF PROGRESS. 1 71 as it does not interfere with the rights of others, is one of the lower motives. It is not the motive power of humanity. Human nature is a many-sided organism and is sub- ject to many appeals aside from the desire for pecuniary gain. Especially is this true of men of culture and gen- ius, who have generally, if not always, served the world without mercenary incentive. Greed is not the chief motive of the human heart. As we look about us, upon every hand we see the evidence of this fact. Look at the life-boat service. Does this exist for gain ? Is the incentive here " honest money ? '" Look at the army. Is it the paltry few dollars monthly that pays for long marches, the loss of limb, the risk of life ? Look at the fire department. Is it money that causes firemen to rush into the flames and struggle like Trojans to rescue property that belongs to others ? Look at the editors, ministers, authors, inventors. Is it dirty dross that incites them to faithfulness ? Thousands of them could make more money in other callings, but they labor on because they love their calling. They often put more money into their undertakings than they ever realize and, frequently, men who are able to retire, toil on assiduously through love of their vocation. Look at the men who strive at cricket, base-ball, and foot-ball ; see them nearly kill themselves at foot-races, boat- races, and cycle-races. Is all this effort, zeal, and en- thusiasm for money incentive? Look at children at play. Is it love of money that makes them rush pell-mell across the green ? In all these instances it is not pecun- iary gain that stimulates to action. The chief motive* are love of approbation, desire to excel, social esteem, etc. These are all stronger motives than mere greed. How, then, in the light of these facts, can one say that 1 72 PRINCIPLES OF SCIENTIFIC SOCIALISM. greed is the motive-power of the human race ? Greed never yet ministered to progress. Says Robert Blatchford : " If a prize is offered for a new machine, will a man of no genius make it ? No. He will try for the sake of the prize ; but he will fail for lack of brains. But no prize being offered, will the man of genius, seeing the use for a new machine, invent it ? He will. History proves that he will invent and docs invent it, not only without hope of gain, but even at risk of life and liberty. " It seems, then, that genius without mercenary incen- tive will serve the world; but that mercenary motives without genius will not." * Men will always do more for love, honor, or fame than they will for money. The lives of Bruno, Galileo, New- ton, and a host of explorers and martyrs evidence this truth. For the sake of love, truth, duty, religion, men and women have suffered imprisonment and martyrdom. Who would do as much for pecuniary gain ? Xo, friends, greed, even to-day, is not the chief motive of life. Even in seeking wealth most men do it for what they think it will bring, admiration and enjoyment. If they thought this end could not be attained in this way, Mammon would not have so many worshippers. Aside from the need of securing the daily necessities of life, the two chief motives that actuate men to acquire money, are the wish to provide for the future of the family and the desire to purchase applause. The former is due to love and the latter to vanity, both of which are stronger mo- tives than mere greed. To deprive money-grabbing one of the greatest hin- drances of progress of its power, we must make de- cided social changes. We must so reconstruct society i Merrie England, Blatchford, p. 131. THE LA W OF PROGRESS. 1 7 J that fortune cannot be secured at the expense of others, that widows and children shall in no case come to want and that wealth will not secure honor or purchase ap- plause. When this is attained the higher motives so long subordinated will come to the front. Secure to all the physical bases of life, and these multifarious motives would start into full activity and serve as the stimuli to higher endeavor and increased excellence. These higher motives which minister to progress and civilization are to-day held in check by our economic system of grab and greed. The whole progress of man consists in restraining his animal nature, in subjecting his passions and developing all the capabilities and possibilities of his being. The struggle has been, and is, between the egoistic and al- truistic principles, and man's progress is indicated by the extent to which the higher dominates the lower. Primeval man was but little superior to the brutes of the field, ignorant, cruel, selfish. But these animal tenden- cies were gradually restrained as the higher principles gained ascendency. Progress has been attained just in proportion as the brute impulses of greed and competi- tive warfare have been eliminated. As society developed this selfish principle was restrained upon the physical plane, where physical strife determined the survival, and passed to the commercial world, taking on the form of industrial warfare. As each realm has been reduced to harmony it has sought refuge elsewhere, and, as the lowest was first closed, it has been driven into higher spheres. Its working on the industrial plane has been so disas- trous that it is fast being eliminated by gigantic com- binations of capital, the purpose of which is to destroy competitive warfare. The trusts and syndicates aim to establish harmony in the industrial realm. Although this is a step in advance the benefits are monopolized by 174 PRINCIPLES OF SCIENTIFIC SOCIALISM. a few. The evil effects of competition are eliminated for those who adopt the principle of co-operation, but the masses, by virtue of this very fact, are compelled to re- main within its grasp. When laborers become wise enough to co-operate for their own well-being, they will socialize the instruments of production and distribution and thus establish complete harmony in the industrial world. The principle of competition, having no further scope in this sphere, would be compelled to seek refuge upon the intellectual plane. When men by co-operative effort supply their physical wants with a few hours' daily work, and are thus relieved from the humiliating fear of poverty, they will begin to compete with each other for honor in literature, art, and science. This principle, however, upon the intellectual plane would not be com- petitive but emulative. Competition would give way to emulation. When people are lifted above the sordid struggle for a mere existence, we shall have such a renaissance as the world has never dreamed of. We have seen that all progress is due to a resistless thirst, an inherent impulse, that drives men forward. This inherent force at the heart of man, this eternal im- petus toward progress, this mental hunger to reach out and become more, all this longing in man has gone on and wrought for progress in spite of the adverse environ- ment of industrial competition. Just as the plant in the cellar or under a stone will reach out and seek for the tiniest ray of light that may come through some crevice, or will attempt to lift off and tumble over the obstruc- tion that hinders its rise, so ever it has been with hu- manity; it has not yet been able to throw off the obstacle of industrial competition, but it has reached out for the ray of light and has gone forward in spite of the obstacles that hinder its progress. This obstacle of industrial competition, however, will THE LA W OF PROGRESS. 175 not always remain. Competition will be supplanted by co-operation and then humanity will spring forward with leaps and bounds. The exquisite Utopian dreams of the past will be dwarfed into insignificance as compared with the glories of that perfect day. Truly did Ruskin say, " Government and co-operation are in all things the laws of life ; anarchy and competi- tion the laws of death." PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER XL INDUSTRIAL DEPRESSIONS AND COMMERCIAL CRISES. INDUSTRIAL depressions and commercial crises are natural outgrowths of our present system of competitive industry. While the evils of this system are often much aggravated by mistaken methods in banking, and some- times the crises are rendered unmanageable by the in- flation of the currency and consequent over-speculation, still no tinkering of our financial and banking system will touch the root of this evil. The real cause of these ever- recurring depressions is something more than a mere excrescence. We need here to note that the development of indus- try favors the growth of banks and credit establishments, and these, in turn, stimulate the over-production of com- modities. In fact, these institutions are only a con- venient method of conducting one portion of the machin- ery of capitalism. Nearly all business to-day is carried on with borrowed capital. If we keep in mind the fact that the system of credit and banking is but a part of the system of capitalism (the functions which formerly were performed by the employer are now delegated to certain individuals) we shall not be deceived by the demagogue's cry of money panics.. Although finances are always m ore or less dis- turbed by such conditions, and frequently a financial crisis appears as the first evidence that the body eco- nomic is out of order, nevertheless, the real causes of the financial disturbance lie much deeper. INDUSTRIAL DEPKESSIONS. 1 77 Let us now inquire briefly into the causes of these depressions and crises. There are several causes which contribute to 'this end. The first that I will mention is the anarchy of private enterprise. Industrial depressions and crises inhere in production for sale. In the first stages of this production every producer produced more or less for self-consumption, the market was small and easily sized up, and the social life of the people remained unchanged. In such a community all were acquainted with one another and each knew the other's wants and purchasing capacity, which remains substantially the same from year to year. Consequently the number of producers and consumers, the amount of yearly prod- ucts, etc., remained practically the same, or changed so slowly that each change was observed and considered. In these days of primitive production, before the intro- duction of machinery, goods were chiefly made for ex- isting demand. In a large measure commodities were made to order, and if not, but a small surplus stock was kept on hand, thus production kept close to consumption. Although the causes of industrial depressions inhered in the method of this small production they did not manifest themselves until production for sale had reached a certain stage of development. Under the rule of small industry production was not capable of much extension. The only way that production could be increased was by working over-time, and this really amounted to but little, the productivity of labor being so small. But as soon as industry developed out of the local market into the world's market, commerce made its appearance and the productivity of labor was enhanced by mechanical in- ventions, the planlessness of production began to result in over-production, and industrial depressions and crises made their appearance. As the markets extended they became more and more 1/8 PRINCIPLES OF SCIENTIFIC SOCIALISM. difficult to control. Production ceased to be carried on for self-consumption and the producer, losing control over the local market, was obliged to seek a sale for his products elsewhere in competition with other producers. The development of commerce, which went hand in hand with the development of transportation, enabled the massing of commodities at any point where demand was manifested, and this, together with the appearance of the middlemen necessitated by trade, made it extremely dif- ficult to estimate the demand for and the supply of com- modities. Industry thus entered the realm of speculation. Both the manufacturer and merchant must necessarily specu- late as to the demand, and this speculation was rendered extremely hazardous because of the number thus en- gaged. Thousands of competitors were but waiting to seize every opportunity for profit, so quickness was a necessity to success. If there arose a demand for a cer- tain commodity in any locality, each tried to flank his competitor, with the result that the community was deluged with products. Prices would then fall and mer- chants would be obliged to sell at a loss, which frequently wrought their ruin. With this excess of commodities and its attendant failures an industrial depression and crisis was at hand. This was the inevitable result just as soon as production for sale reached the point of extended markets. Here private enterprise compels every pro- ducer to produce and sell for himself, and to keep all his transasctions secret, although the success of both pro- ducer and merchant depends on how much others pro- duce and sell. A few orders are received and each manu- facturer produces two or three times the requirements, hoping to dispose of all that is produced, for the more goods sold, other things being equal, the larger the profits. Here, note, all of this production is absolutely INDUSTRIAL DEPRESSIONS. planless. No one knows anything about the extent of the demand ; each is merely guessing in the dark. But each pushes his industrial activity, for his machinery and factory deteriorate from disuse. Each also desires to re- tain his special workmen, and so production is con- tinued just as long as possible. Everything seems bright, and confidence becomes blind and credit unlimited. Pro- duction increases prodigiously and each is bent on sur- passing, outbidding, and over-reaching the other. In this condition the commercial demand is soon met, but as each is ignorant of both the demand and the doings of his fellow competitors, each pushes on lest he be left in the chase. In order to gain trade manufacturers resort to every device known to man. New machinery is invented, wages are reduced, goods are adulterated, all for the purpose of reducing the cost of production and so under- selling a rival. Manufacturers vie with each other in their concessions to jobbers and distributers, selling goods on long credits, and they, in turn, place the goods with retailers on like terms, the whole process being sustained not by capital but by credit. The result of this free-for-all, go-as-you-please method of procedure is to flood the markets with goods for which there is no demand. Nevertheless, manufacturers keep on produc- ing and business men keep placing orders in anticipation of new orders, and so pay old debts by contracting new ones. But finally trade becomes blockaded and business stagnates. Soon the merchant must pay for the goods he bought; but as the goods are un- sold, he cannot meet his obligation and so fails. The manufacturer has contracted debts, relying upon pay- ment for his product to meet them, and as his debtoi cannot pay him he cannot meet his obligation and so must fail. And now the bank having advanced money l8o PRINCIPLES Of SCIENTIFIC SOCIALISM. to the manufacturer is unable to realize on its securities and so must suspend operations. Thus the disease spreads, failure follows failure, bankruptcy following bankruptcy the crisis is here. As one branch of industry depends upon another, when one suffers all suffer. The suspension of produc- tion in one field evidences itself throughout the whole network of industry. The circle of depression becomes wider and wider; it feeds itself until all production and commerce are paralyzed. Stores are now filled with goods of every description and millions of workingmen are unemployed. These vast quantities of goods are sold at a great sacrifice. They must be gotten rid of at some price, else they become worthless. After some years of stagnation this glut or over-production is relieved and society begins slowly to recover. The surplus goods having been consumed and wasted, the demand again calls for renewed production. Production begins, at first cautiously, but orders increase, and soon the thousands of bankruptcies are forgotten and the engines of produc- tion are again driven at full speed the golden age of prosperity has again dawned. Producers wish to in- demnify themselves for what they have lost, and if they have any misgivings as to the future, they hope to make themselves good before another crisis appears. Every producer is thus actuated to try to get the better of his competitor. The catastrophe is thus again invited and comes in response to the call, only with increased vio- lence and more damaging effects. Thus, under the present system, the crisis is inevitable, and is of periodic recurrence. Industry runs what is called the vicious circle from every seven to ten years. Beginning with the crisis of 1815 nine such catastrophies ;iave affected the United States during the nineteenth century. Nor have these dread evils been confined to INDUSTRIAL DEPRESSIONS. iSl this country; they are world-wide and nearly contem- poraneous in all the great manufacturing nations. When we stop to consider the haphazard manner in which production proceeds, it is a wonder that our in- dustrial mechanism runs as well as it does ! Just so long as each producer continues to act for himself with- out any knowledge of what his fellows are doing, de- mand and supply will never be adjusted. No one would think of applying such a method to his individual business. Our present senseless and chaotic system of production cannot help creating, at stated periods, more goods than can be consumed. The result is stagnation. Production must cease until the equilibrium is again es- tablished, when the whole tragic farce is again re- peated. These crises are crises of abundance, and they will continue so long as hundreds and thousands of bosses are engaged in suicidal competition, producing goods without regard to commercial demand. Industry can only be regulated by socializing production. If all or- ders came into one central office the demand would be known, and production could proceed accordingly. The demand would also be ascertained by official returns furnished by the various departments. Collective owner- ship of the great means of production and distribution is the only way by which the present anarchy of production and distribution can be systematized. Social ownership would transform this insanity called business into a sane and orderly production and distribution of wares. Socialism would establish a central directing authority, a thing which Herbert Spencer says belongs to every highly developed organ- ism. Imagine our physical organism trying to do business on the competitive principle. A lone violinist needs no djrecor, he can start and stop at will, but an 1 82 PRINCIPLES OF SCIENTIFIC SOCIALISM. orchestra needs a director. Imagine an orchestra in which each player started and stopped to suit his own taste. As an orchestra needs a director to mark the time and start the music, so our economic organism must have a central directing authority if we would escape industrial anarchy. This central directing authority would be supplied by the Co-operative Commonwealth. The Co-operative Commonwealth would be but the co-operative factory on a larger scale. All modern pro- duction is co-operative. What Socialists want is the application to national production of the principles and methods which the individual applies to his own produc- tion; that is, co-operation, unification and systemati- zation. Look at any of our large productive plants. .Here you see a central regulating authority, and each department is correlated with every other department. Take, for example, the production of wagons. Suppose an order is received at the office for one thousand wagons. The general manager at once gives the order to the superintendents of the various departments, and they in turn direct the foreman of each branch, who proceeds to set the laborers at work to produce the requisite parts. All departments proceed in perfect ac- cord, the number of workers being so adjusted that the work progresses simultaneously. As fast as the parts are completed they are sent to the finishing room where they are put together. When each department has com- pleted its work and the various parts are united, it is found that there is no excess or shortage anywhere. The thousand wagons stand complete. Now contrast this orderly and systematic method with the chaotic and hap- hazard procedure in our national production. Each branch of the national factory, like that of the individual, should be correlated and adjusted with every other branch. In order to accomplish this there must be a INDUSTRIAL DEPRESSIONS. 183 central regulating authority, just as we find in every in- dividual industry, which shall ascertain the demand and regulate the forces of production to meet it. As the orders come into this national office, they would be placed with the heads of each department, who in turn would give to each branch orders to produce. A suffi- cient number of men would be employed in each depart- ment to meet the demand, with the result that there would be no excess or shortage anywhere. Socialism, then, by this systematic organization of in- dustry would eliminate this cause of the crisis the pres- ent planless anarchical procedure. Another cause of depressions and crises, also inherent in the system of private enterprise, is the exploitation of labor. Labor exploitation renders over-production cer- tain, even if the trust, as is sometimes claimed, could eliminate the present chaotic method. Under the wage system, the .product of the producer is divided into two parts : one part goes to labor in the form of wages, the other to capitalists, landowners, and other gentlemen at large, in the form of rent, interest, and profits. In 1890 the 355,415 mechanical and manufacturing establish- ments in the United States produced a total product of $9,372,437,283. If we deduct from this sum the cost of the raw materials, the wear and tear of machinery, in- cluding cost of repairs on buildings, etc., which expenses are transferred in the process of production to the new product, which amounted to $5,162,044,076, we get as the new values created $4,210,393,207. The number of men, women, and children employed in the production of these values was 4,251,728, and their wages amounted to $i,89i,296,i66. 1 If we add to these operators the i The Statistics of the nth census include with laborers the officers, firm members and clerks, which constitute 9.78 per cent. 1 84 PRINCIPLES OF SCIENTIFIC SOCIALISM. 105,634 clerks who received $89.788,900, we shall have the total number of persons employed as 4,357,362, and the total wages received as $1,981,085,066. Now if we deduct the total wages from the new values created we find that the profits amounted to $2,229,308,141. This profit represents surplus-value. The laborers, then, re- ceive but about 47 per cent, of the wealth they produce. They are obliged to submit to this fleecing for the reason that they do not possess the machinery of production and so must sell their labor-power to the capitalist at the market price, which is determined by the competition in the labor market. Of course, if laborers receive but 47 pe.r cent, of the values they create, they can buy back but 47 per cent. of the total product. Nor even that, for the value here given is the figures of the factory price at which the manufacturer sells to the dealer or another manufac- turer. But workingmen do not buy at factory prices but at retail prices. To the factory price must be added .'the profits of a long series of middlemen and retailers which results in doubling the factory price. The laborer, then, when he goes to the market to purchase the com- modities he has produced, finds that instead of purchas- of the number of employees given, and they receive 17.17 per cent, of the total wages paid. The figures above given are the number of persons employed and wages paid, exclusive of firm members, officers of corporations and clerks. The clerks, how- ever, may legitimately be added to the wage-workeis. The num- ber of officers, firm members and clerks, are given as 461,049 The number of clerks is not given separately, but if we allow only one firm member or officer per establishment the possible maxi- mum number of clerks was 105,634. This is obtained by sub- tracting the number of establishments 355,415, from the number of officers, etc., 461,049. Now if we grant to each clerk the aver- age salary of 8850, the amount given by the census returns to those classed under this head, we get the salary of the 105,634 clerks as $89,788,900. INDUSTRIAL DEPRESSIONS. 1 8$ ing 47 per cent., he is only able to buy about 23 per cent, or 24 per cent., and even this estimate is in excess. When we take into consideration money spent for rent, doctor's bills, insurance, pleasure, etc., it is evident that he cannot purchase over 15 per cent, or 16 per cent, of the. value he produces. These estimates are made on manufacturing industries where wages are the highest. If we take the laboring class as a whole they cannot purchase over 10 per cent, or 12 per cent, of the wealth they bring into being. This being true, if every indus- try were organized into a trust and all acted in perfect harmony, laborers could not be continually employed; for to utilize all the economic forces would mean to pro- duce in excess of commercial demand. It is thus that the wage system has become a social curse. Between the producing and distributing capitalists the laborers are exploited out of the larger portion of the wealth they produce. They are thus unable to consume the product of their toil. The capitalists, on the other hand, being comparatively small in number, are unable, even by their best efforts, to consume their portion of the product, and thus a large surplus is left on their hands for which there is no commercial demand. We are thus confronted by a condition of over-production, or rather under-consumption, for there can be no such thing as the former so long as men are in need. .What is meant is that those who possess the goods do not need them, and those who need them have not the means of purchasing them. Were laborers paid in full for their labor they would quickly dispose of the surplus. But as produc- tion is carried on for profits the capitalist does not pro- pose to give away these products which he has compelled the laborers to give up, neither will he produce more until he can dispose of the goods on hand. Production can only be sustained by consumption and consumotion 1 86 PRINCIPLES OF SCIENTIFIC SOCIALISM. is limited by wages. The wages paid will not buy the products produced. Consequently factories are closed, men discharged, and their families reduced to degrada- tion and starvation. How to procure an outlet for this surplus product which has been withheld from the wage workers, is the great question of the capitalist producer. The use of machinery has so increased the productivity of labor that, unless some outlet can be found, production must cease at intervals until the excess is consumed. It does not cease because the needs of the people are all sup- plied, but because of the cessation of the commercial de- mand, due to the limited consuming power of the wage workers. The laborers would gladly consume more, but their wage does not permit them to do so, and to in- crease their wages would mean to decrease the portion of the non-producers. The very mention of this remedy gives the capitalist nervous prostration. The only other outlet is in foreign markets. But as the capitalist be- gins to compete in the markets of the world, he has to reduce his cost of production to the level or below that of the foreign competitors, and so wages are reduced to meet the pauper labor of Europe. Just as soon as an industry reaches the point of development where it pro- duces more than its exploited workers can buy, then it must seek the world's market, and the fact that it is a protected industry does not help the matter in the least. Most of our industries have already reached that stage and their managers are rapidly adapting their businesses to the foreign trade. This they accomplish by introduc- ing new and improved machinery and reducing the pay rolls of the decreasing number of hands employed. While the United States pays the largest wages of any country, it is simply because of the stupendous increase in the productivity of labor. The American workmen INDUSTRIAL DEPRESSIONS. 1 87 are more productive than the workmen of any other country. But there are no laborers who are more ex- ploited than these same laborers of America. They re- ceive a smaller proportion of the wealth they create, are fleeced more, than the laborers of any other country on the face of the earth. But in spite of all the efforts of the capitalist class, they are unable to unload all the surplus upon the other nations. Markets have failed to expand in proportion to the increase of production. It is clear that a con- stantly expanding production requires a constantly ex- panding market, and where such is not the case stagnation occurs and crises ensue. As laborers are con- tinually receiving a smaller proportion of the wealth they create, the home market is undermined, for they are less and less able to purchase the goods they pro- duce. Thus the surplus grows with the displacement of labor and the reduction of the wages of the laborers em- ployed. While the machine takes the place of the labor- ers in production it cannot in consumption. When goods were chiefly produced by hand labor, the laborer received wages with which he purchased a portion of the wealth he had created. But when he was supplanted by the machine he could no longer be a consumer, and the commodities which he thus previously consumed were left upon the markets. And not only these commodities but an abundance in excess, for the productivity of the machine is many times that of the workman. This growing condition has heightened the need of foreign markets as an outlet. But all civilized nations are in the same predicament, with the result that where the crisis was once strictly periodical it is now becoming permanent. Over-production has become chronic. While foreign markets have extended they have not kept pace, as has been pointed out, with the ever-increasing 1 88 PRINCIPLES OF SCIENTIFIC SOCIALISM. development of production. But there is a limit to the extension of these markets, and not only that, but the time draweth nigh when these markets will begin to contract. Russia, China, Japan, Australia, and the East Indies are already developing into industrial states, and will soon be able to supply their own wants. These na- tions are beginning to produce for themselves ; they are adopting our inventions and improvements and will soon cease to be customers and become competitors. Every extension of* the market has been tantamount to conjuring up a new competitor. When these new for- eign markets are closed, what will be the result ? There is but one answer. The whole capitalistic system will fall. It will end in the bankruptcy of the capitalist so- ciety. This cataclysm will engulf the whole world unless forestalled by the Socialist Commonwealth. We have now seen that the crisis is the result of our planless system of production and its inherent exploita- tion of labor. These crises will continue just as long as our present system of industry remains. When over- production or under-consumption is the very basis of our present wage and profit system, is it any wonder that we have industrial depressions and crises ? There must always remain under the present order a greater or less glut of goods upon the market owing to the fact that the purchasing power of the people is in- sufficient to clear the market of the goods. Even if la- borers were not exploited by the producing capitalist, the distributing capitalist, by adding to the labor cost of commodities, produces a gap between the producing and consuming power of the people, and the larger the profit charged the greater the gap. This condition tends to intensify and so ren- der the depression permanent. In periods of so-called prosperity there are thousands, even millions, unem- INDUSTRIAL DEPRESSIONS. 189 ployed. Prosperity, when said to be on tap, is to-day of little or no benefit to the common people. In 1898 and 1899 there was so we are told a period of unparelleled prosperity. The trusts and monopolists in general made their millions. Did the laboring class, or even the mid- dle class, share in this prosperity ? By no means. Amid the large accumulation of profits by the few, there were wage reductions, idleness, and destitution. The reason why the middle class suffers at such times is the concen- tration of business into the hands of the trusts. A large volume of business may be done, but owing to this con- centration little falls into the hands of the great mass of the people. Of course, laborers cannot expect to be greatly benefited by such prosperity, for the work prev- iously performed by them is now largely done by ma- chinery. The only kind of prosperity possible when capitalism has developed to its present stage, is the pros- perity of the few. The greater the prosperity of the few, the worse the condition of the many. You cannot in- crease the unearned income of one, without taking from the earned income of the other. However, I am finding no particular fault with capital- ists. The rate of profit could not be safely reduced to the point sufficient to bring production and consumption into harmony. The root of the evil lies in the economic system itself, in the difficulties, complexities, risks, and wastes inherent in capitalism. The Socialist method is the only way of abolishing the disparity between the producing and consuming power of the people. The only remedy for depressions and crises is the abolition of production for sale and profit. Prof. Ely says that this claim is well founded, " because crises and industrial depressions are part and parcel of the competitive sys- tem of industry, and would cease to afflict society with the abolition of the competitive system." 190 PRINCIPLES OF SCIENTIFIC SOCIALISM. Under Socialism, then, these evils would be impossi- ble. They are the results of modern industrial methods. The phenomenon made its appearance when production for sale reached the world's market, and has grown in severity as capitalism has developed. The root of the evil inheres in capitalism and can only be removed by Socialism. LABOR-SA VING MACHINER Y. CHAPTER XII. THE PROBLEM OF LABOR-SAVING MACHINERY. LABOR-SAVING machinery constitutes one of the most serious economic problems of the day. The introduction of these mechanical appliances has completely revolution- ized industry, and is rapidly substituting machinery for men in every field of production. This fact is generally recognized by intelligent people, although now and then we hear someone say that machinery gives employment to more labor than it displaces. This statement is an heirloom of the early days of the factory system. That men should put it forth to-day simply shows their igno- rance of the changed conditions of industry. It is true that in the early days of modern industry, although machinery greatly displaced handicraftsmen, still, owing to the development of the factory system, often more workmen were employed than were dis- placed. This was due directly to the growth of the fac- tory system, to the building of new mills and the exten- sion of old ones. But here we need to note that while there may be an absolute increase in the number of la- borers employed, there is a relative decrease in propor- tion to the total capital advanced. As we shall see, the introduction of machinery means that the .constant capi- tal increases while the variable decreases. The state- ment, then, that while machinery displaces workmen it gives employment to more than it displaces, was only true during the period of transition from the manufae- tural age to that of modern industry. Since the age of 1 02 PRINCIPLES OF SCIENTIFIC SOCIALISM. machinery has reached its present development, the in- troduction of new methods and improved processes does not result in the final employment of more workmen, but rather in increasing the number of unemployed. The necessary condition for the employment of an increased number of hands in any industry is a rapid growth of capital invested in new factories. Modern in- dustry long since reached the point where the extension of factories is sufficient i6 absorb the men displaced by the new machinery. This absorption was merely a tem- porary phase of the industrial development, and was sure to end as soon as industry had reached its approximate growth. The phenomena belonged purely to the first stages of modern industry. Since this era of production has entered the stage of monopoly, the exact reverse is fehe admitted tendency. The development of industry under the syndicate and trust does not consist in the ex- tension of factories, but the opposite. The concentration of business has resulted in closing factories, as in the oil and sugar businesses, where a few establishments now do the work formerly done by many. The Standard Oil Trust, for example, has dispensed with the services of eight thousand seven hundred teams of horses, wagons, etc., and eleven thousand seven hundred men, who wera formerly employed in handling oil. The formation of the Chicago beer trust is another illustration. There were thirteen breweries, and each had its bookkeeper, clerks, salesmen, deliverymen, and operatives,, The trust did away with all this waste. Says Mr. Baumgarti, the gen- eral manager of the brewery trust : " Economy is the watchword and a great saving to the brewers will be accomplished by doing away with large office forces and transacting all business from this office. The sole benefit of the common company is the increase of profits by cutting down the number of employees, by large cash LABOR-SA VING MA CHINER Y. 193 purchases and by correction of business errors common in the management of the individual businesses." The tendency of competition is to multiply establishments, but the tendency of combination is exactly the reverse. The only effect of machinery upon labor to-day is to decrease its value, and to render the laborer super- fluous. The misconception regarding machinery is due to the failure to recognize the changed condition of industry. This misconception takes several forms which I will briefly consider. It is assumed that the machinery which displaces la- borers also sets free a sufficient amount of capital to again employ them. This assumption is entirely erron- eous. Suppose in a modern factory two hundred men are employed with a capital, say, of $6,000, half of which is constant and half variable. 1 Now suppose machinery is introduced costing $1,500 and capable of doing the work of one hundred men. This would transfer $1,500 from variable to constant capital. The total capital and product would remain the same, but the machinery now takes the place of half the number of men employed; the work previously performed by two hundred men is now, by the aid of the new machinery, done by one hundred men. In the process no capital is liberated ; the cost of the machinery equalled the cost of the labor- power saved. But now, suppose the new machinery which saved the labor of one hundred men had cost but $1,000, then the $1,000 would have become constant capital and $500 would have been liberated: This $500 1 Constant capital is that portion of capital invested in the means of production. It is called constant because it does not change its value during the productive process. Variable capital is that portion of capital invested in labor-power. It is so called because it changes its value during the productive process. 194 PRINCIPLES OF SCIENTIFIC SOCIALISM. however, would employ but a third of the one hundred men displaced even if it could all be used as variable capital. But a part of it must become constant capital before any of it could become re-employed. Thus the amount remaining for the re-employment of labor would be very small and would employ but a few men. Again, it is assumed -that the labor displaced by ma- chinery finds employment in making the machines. But as machinery is introduced for the purpose of saving labor-power, the supposition that the labor displaced by machinery finds employment in making the machinery, is seen to be absurd. Some of the displaced labor can thus find employment, but only a portion.- Were all thus displaced to find employment the cost of the ma- chine would equal the cost of the labor-power displaced and the capitalist would make nothing in the transac- tion. The capitalist only introduces the machine when the value of the machine is less than the value of the labor-power displaced by it. If one thousand days' labor is embodied in the machine, and the machine lasts one year, it transfers its value to the year's product. But if the machine, during the year, has displaced only one thousand days of labor, the capitalist has made nothing by using the machine. If the labor-power displaced by using the machine is all utilized in making the same machine, of course, the capitalist might as well have paid for the labor-power directly. The cost in one instance is the same as in the other. It costs as much to produce the machine as was saved by its employment. In such a case the total labor embodied in a commodity is not altered. But if a machine which embodies a thousand days' labor produces more during its life than a laborer can produce in a thousand days' labor with his tools, then labor-power has been saved by using the machine. Were labor-power not thus saved the machine would not have LABOR-SAVING MACHINERY. 195 been invented. Its very purpose is to increase the pro- ductiveness of labor and so save labor-power. This, however, could not be if the labor cost of the machine equalled the labor displaced by it ; or in other words, if the labor displaced by the machine could find employ- ment in making the machine. But, again, it is assumed that as machinery greatly increases the productivity of labor and so consumes a larger quantity of raw materials, that this increases the demand for labor in these fields of production, and so the labor displaced is compensated. The introduction of machinery into a certain industry may, temporarily, increase the demand for labor in those branches which furnish industry with the raw materials. This, however, is on the supposition that machinery has not yet seized on these trades. But with the introduction of machin- ery into these supplementary industries, the same condi- tion would exist here as in the other fields invaded by machinery. Any benefit, then, that thus accrued to labor would be only temporary, and due entirely to the back- ward state of some extractive industries. But that con- dition has long since passed. Machinery has now in- vaded every field and men are everywhere thrown out of employment, and this without compensation. They are thus rendered unable to purchase the necessaries of life, and other industries are obliged to shut down for want of sale of their products. Machinery, then, not only throws workmen out of em- ployment in the industries where it is introduced, but also in other industries in which it is not introduced. Machinery is but a means for producing surplus-value. Like every other source of increase in the productive- ness of labor, it but cheapens commodities, and so lessens that portion of the working day in which the laborer toils I9 6 PRINCIPLES OF SCIENTIFIC SOCIALISM. for himself, and lengthens the portion of labor-time ap- propriated by the employer. Machinery, which was designed to be of service to the laborer in lightening his toil, has resulted, under private ownership, in the laborer's degradation. It is the ma- chine, the mechanical fellow workman, the laborer need fear. Every year an astonishing amount of these iron and steel workmen are brought into competition with human labor. In the decade from 1880 to 1890 the new mechanical power put in operation was equivalent to the labor-power of forty million men. In the light of this fact, what do the few thousand, or even million, immigrants amount to ? Were the capitalist to be de- prived of cheap labor, would he not introduce mechani- cal power, and gain by the transaction ? Every labor- saving appliance can be run for eight cents a day for every man displaced. Here is the pauper labor com- pared with which the immigration of pauper labor from Europe is insignificant. If immigration were prohibited to-morrow, it would have scarcely any influence upon the competition in the labor market. Improved appli- ances would soon neutralize any temporary advantage -that might accrue to labor. The machine, then, is the real competitor of the laborer. Instead of machinery giving employment to more labor than it displaces it but displaces workingmen and renders human labor su- perfluous. Glance for a moment at a few of these new devices. There is a new electrical riveting machine which inserts 1,200 rivets in ten hours. A needle-making machine has lately been introduced which turns out 260 needles a minute. A new can-making device is in operation which may be bperated by a child; the sheets of tin are fed into it at one end and at the other 64 cans drop out every minute, 38,000 every day, An expert tinner can LABOR-SAVING MACHINERY. make but 500 cans a day. Each machine, then, dis- places between 70 and 80 men and is operated by a child. A can-labelling machine has been perfected which labels 60 cans a minute. There is a self-feeding platen press, of late invention, that prints 10,000 or more cards in an hour, registering to a hair. Cigar-making ma- chines, which turn out neatly wrapped cigars at the rate of 3,000 a day, have made their appearance. A bread- moulding machine has been invented with which three persons can mould over 20,000 loaves a day. A pea- shelling machine has been put in operation by which three machines, operated by five to eight persons, shell as many bushels of peas as a hundred hands used to. This machine works automatically and will, with a few improvements, be operated by one person. A glass- blowing machine has been introduced which turns out tumblers at the cost of six cents a hundred against fifty cents by the old-hand process. In the cotton industry one man and two boys now do the work formerly re- quiring one thousand spinners. Among weavers one man now does the work of fifty. In making horse-shoes one man can do the work which years ago required the labor of five hundred men. In making nails one man can now do the work formerly done by one thousand men. One man can to-day set as much copy in type as used to require from six to ten men. With the Northope loom one man now does the work of ninety men with the hand-loom. In the steel industry three men with the latest machine will turn out in ten hours two hundred and fifty tons of steel billets, whereas in 1892 it required one hundred and fifteen men to do the same work in the same length of time. In boiler-making thirty men now do the work that but a few years ago required five hun- dred men. In agriculture each patent binder throws nearly twenty men out of work, each cotton harvester 19* PRINCIPLES OF SCIENTIFIC SOCIALISM. displaces thirty-eight men, each steam-plow twenty-one men. Each riveting machine displaces twenty-one men. Each steam-roller with patent pick throws out of work from eighteen to thirty-eight men. The illustrations might be indefinitely multiplied, but why continue ? Is it not evident that machinery is con- stantly displacing labor ? Are not laborers by the thou- sands and millions being robbed of their living by the introduction of labor-saving machines ? What, then, is to be done ? Shall we break up the machines ? No, socialize them. It is the private owner- ship of machinery that throws men out of work. Ma- chinery should belong to those who make it and use it, and not to a few idlers who are thus enabled to appro- priate all its benefits. The time will come when the work of the world will be accomplished by simply pressing an electric button. But with the private ownership of the button, what will become of the displaced workingmen ? Under capitalism production is only carried on for profit. But production can only be sustained by con- sumption and consumption depends upon the oppor- tunity for employment. But when a few, by simply pressing a button, produce the goods, then the great multitudes will be unemployed, their consumptive power gone, and they themselves reduced to degradation and starvation. The only solution of this condition is to socialize the electric button. If society expects to enjoy the fruits of mechanical invention these instruments must be socially owned. Under Socialism machinery would result in a blessing to all. Mechanical inventions would then serve labor instead of competing with it as to-day. When the time came, through the introduction of new inventions, that all the. needs of the people were supplied in abundance, then further improvements would be applied to reducing LABOR-S A VING MA CHINER Y. 1 99 the hours of labor. The only way that machinery will be of service to labor is for labor to own the machinery. The collective ownership of machinery is the only solu- tion of the problem. 200 PRINCIPLES OF SCIENTIFIC SOCIALISM. CHAPTER XIII. POPULAR ECONOMIC ERRORS. I. THAT VALUE is DETERMINED BY CAPITALIST COST OF PRODUCTION. THIS economic error is a very common one. The phrase, cost of production, is used by political econo- mists to denote the capitalist cost, but they do not agree among themselves in regard to the items which should be included. While -some include wages, replacement, interest, rent, insurance, taxes, etc., others limit the cost to wages and replacement ; that is, cost of labor, cost of raw materials, and cost of tools. The latter represents the real capitalist cost. We need to note here, particu- larly, that by the cost of labor they mean its cost to the capitalist, which depends upon the cost of the laborer's living. 1 They entirely overlook the important distinction between the exchange-value and the use-value of labor- power. In this way it is sought to cover up the whole method of capitalist exploitation. Now the value of a commodity, or the cost of produc- 1 The " cost," "price " or " value of labor," as used by politi- cal economists, is what Marx calls an " irrational expression for the value of labor-power." Remember, it is labor-power the capacity for labor that the laborer sells. As stated by Mr. Hyndman, " What the human beings without property are so anxiously trying to sell is therefore not labor but the power to labor." We should subtitute for the popular inaccurate expres- sion " cost" or " value of labor," the scientific phrase "value of labor-power." We cannot be too careful in our use of terms. POPULAR ECONOMIC ERRORS. 2OI tion which regulates the price, is determined by the quantity of labor embodied in the product. The three factors of production are the living labor, the raw mater- ials, and the wear and tear of the tools or implements. The sum of these factors represents the labor socially necessary for the production of a commodity. Thus, if in the production of a commodity the raw materials cost $3 and the wear of the tools represents $i, and, say, this $4 represents the value of two days' labor of twelve hours each, then we have the first two factors embodying two working days. Now if these means of production can be transformed into the finished product by six hours' labor, then the commodity w r ill cost two and one-half working days. The finished product, then, containing two and one-half days' labor is worth $5. But this is what it costs the capitalist $4 in raw materials and tools, and $i in labor-power. If the product is sold for $5 it is evident that the capitalist will make no profit. But he has been engaged in the process for profit. He rrmst find some factor, which, in the labor process, is capable of producing more value than he paid for it. He first looks at the raw materials and instruments of pro- duction. But these are implacable. They change their shape during the process of manufacture, but their value does not change ; it disappears in one form only to re- appear in 'another, but with no increase. The value of these factors is simply transferred to the new product. Finding no help here he now turns to the labor-power. He perceives that the laborer uses a certain quantity of the necessities of life and that these can be produced in six hours' labor, and are worth $i. "Well," says the capitalist, " there is no reason why the workingman should not work twelve hours per day ; he produces his keep in six hours, and so I shall demand that he work the other six hours for me .free gratis." The extra 202 PRINCIPLES OF SCIENTIFIC SOCIALISM. material is supplied and the laborer is kept at work for twelve hours, consuming twice as much of the means of production. The value, then, of the product produced in twelve hours is double that produced in six hours. But it has not cost the capitalist twice as much ($10), he has paid out but $9, $6 for raw material, $2 for wear and tear of implements and $i for labor-power. In other words, the capitalist, while paying only $i for his labor- power, makes it operate not six but twelve hours, in which time it consumes $6 of raw material instead of $3, and $2 of the tools of production instead of $i, and so produces a product which embodies five working days instead of two and one-half, and is, therefore, worth $10 instead 'of $5. But the capitalist has paid for onb four anc j one- half days' labor. He has paid in full for the labor embodied in the raw materials and implements of pro- duction used, but not so for the livmyj Jabor. The product embodies twelve hours' living labor, but the capital- ist has paid for but six hours. The finished product, then, contains six hours surplus-labor and represents $i. The laborer has been exploiter out of one half the value of his toil. This surplus-value is unpaid labor. The reason that the laborer is thus fleeced is, that under the capitalist system, labor-power is an article of merchandise, which th* employer purchases, the same as any other merchandise, at its exchange-value, and, as with every other merchandise, he gets its use-value. The use-value of labor-power is its productivity. It is prized by the capitalist because it is capable of producing more value than it costs. We have seen that the raw materials, machines, etc., u^.i in production, create no additional wealth. Their exchange-value simply passes over and becomes embodied in the new product. The merchan- dise labor-p'vwer, on the other hand, does produce ad- ditional wealth. The use-value of labor-power produce* POPULAR ECONOMIC ERRORS. 203 more value than the exchange-value amounts to. This additional value is capitalist fleecings. We are now able to see clearly the difference between the capitalist cost and the labor cost. It is the difference between the exchange-value and the use-value of labor- power. The labor cost is the amount of social labor em- bodied in a commodity. In the above example three days represented the raw material, one day the tools consumed, and one day labor-power in all five days, which, at $2 a day equals $10. The capitalist cost deals with what this social labor costs the capitalist. He has to pay full value for the labor embodied in the raw material (three days at $2 a day, equalling $6), and for the tools con- sumed (one day at $2 a day), but with the labor-power, instead of paying $2 for the day, he purchases it for $i, thus making the total cost to him but $9. He thus makes $i profit, the difference between the exchange-value and the use-value of labor-power. This reveals clearly the method of exploitation. Labor has been fleeced out of one-half of the product it created ; in other words, it has replaced its cost of production two- fold. In spite of this obvious fact we are told by politi- cal economists that labor, having received its cost of liv- ing, has received a full economic equivalent for its con- tribution to the product, a statement both confusing in theory and fallacious in fact. By cost of production, then, we mean labor cost the labor socially necessary to produce a commodity. Soci- ally necessary labor means the average quantity of com- mon labor measured by time, which on an average is requisite, by the implements and methods generally used, to produce a commodity. Now let us note how this principle works under the profit system. All manufacturers producing under nor- mal conditions realize normal profits. If, for any 204 PRINCIPLES OF SCIENTIFIC SOCIALISM. reason, a manufacturer is unable to adopt the methods which have come into general use, his cost of production will exceed the average cost which determines values, and so he will receive smaller profits. On the other hand, a manufacturer with exceptional advantages, due perhaps to some new mechanical appliance, may be able to produce at less cost than the average and so reap an abnormal profit. Prices being determined by the aver- age cost of production he will sell at the regular price regardless of his cost. But as soon as his new method becomes generally used, a new value is established and prices fall to the new level. This deprives him of his special advantage and forces all who are not able to in- troduce the new implements into bankruptcy. Thus, suppose the socially necessary labor embodied in a pair of shoes is one hour. A manufacturer intro- duces an improved machine by which two pairs can be -produced in the same time. So long as he is able to maintain his secret, he can secure an extraordinary profit. But in the course of time his invention, or one equally effective, is adopted by other manufacturers and, as these improvements become general, the social labor embodied in shoes falls by one-half and prices are gradu- ally adjusted to the new level. Remember, it is not in- dividual labor but the social labor that determines value. Although the individual manufacturer reduces the cost of production that does not affect the social cost. It is only when the social cost is lowered that values fall. After the change is made some may continue to use the old methods, but for all that, the product of such labor would represent but one half hour of social labor, and the price would soon fall to that level. The former labor and product would then be governed by the new social standard. Values are constantly falling as the productiv- ity of labor is increased. This lowering of prices, in POPULAR ECONOMIC ERRORS. 2O$ accord with the reduction in the cost of commodities, results in innumerable failures. A manufacturer can continue business so long as his capitalist cost does not equal the social labor cost which fixes prices. But as soon as the rapidly falling social labor cost reaches his capitalist cost of production he is obliged to suspend operations. Thus, suppose in the production of cotton cloth the social cost is 4 cents a yard, and the capitalist cost 3 cents, leaving i cent profit. But there is now and then a manufacturer whose capitalist cost of making cotton cloth is, from various causes, such as inferior skill, in- sufficient capital, inferior machinery, location, etc., 3^2 to 3^ cents a yard. Now suppose that by the introduc- tion of new machinery the value of cotton cloth falls to 3 cents a yard and the capitalist cost to 2 cents; it is evident that those who were producing under disadvan- tageous circumstances, on the narrow margin of l /2 to Ys of a cent a yard, would be forced out of business. For if they were unable to adopt the general methods before the change, they certainly would not be equal to the emergency now. It is among this class of producers that bankruptcies occur, and it is not necessary for a revolution in industrial methods to cause their ruin. They are the first to succumb in industrial depressions. An over supply of goods depreciates the market price below their value, and those producing on narrow margins are forced to abandon their enterprises. Values, then, do not depend upon the capitalist cost of production, or, as some have erroneously supposed, upon the cost of producing the most expensive portion of the supply, but upon the average cost of production ; that is, upon the socially necessary cost of production. This cost, under normal conditions, determines prices; that is, under such conditions the market price of a com- 206 PRINCIPLES OF SCIENTIFIC SOCIALISM. modity coincides with its value. But conditions, how- ever, are not always normal, and we frequently find prices varying from the socially necessary cost. This is due to supply and demand and to what has been called " economic perturbations." By " economic perturbations " is meant those fluctua- tions in prices, especially where there are various prices for the same article in the same market, which are due to ignorance of the facts or because the parties are not free to act in accordance with their knowledge and in- terests. In all such exchanges one gets more and the other less than an equivalent. Such exchanges are in- imical to one of the parties and it is clear that he would not submit to it if he knew it and were free to act other- wise. Such perturbations are greater in the retail market than in the wholesale, and greatest in those sections of the retail trade where poverty and ignorance abound. The ignorant consumer is imposed upon both as to qual- ity and price of commodities. The poor are often under obligations to the shopkeeper and so not free to trade elsewhere. These variations, however, tend to regulate them- selves. As they involve loss to either producer or con- sumer, their interests will lead them to avoid the disad- vantageous exchanges just as soon as they know the facts. Supply and demand, also, as is well known, tend to an equilibrium. In considering the law which regu- lates values we eliminate these uneconomic conditions and consider the primary law in its purity. This is the true scientific method : first establish the law and then you are free to consider the perturbing or incidental causes which affect it. Many who are not careful in analysis have fallen into error and mistaken one of the mere incidents for the law itself. We cannot be too care- ful in our analysis. POPULAR ECONOMIC ERRORS. 207 It has now been clearly shown that value is not de- termined by the capitalist cost of production. It is of the utmost importance that this error be clearly com- prehended. 2. THAT THE INTERESTS OF LABORERS AND CAPITALISTS ARE IDENTICAL. We hear much talk, by the defenders of the present order, of the harmony, partnership, and identity of in- terests between labor and capital. It is true, there is harmony between labor and capital, but not, as our friends wish to imply, between laborers and capitalists. Those who are fond of declaiming about this harmony utterly fail to recognize the changed methods of produc- tion. When the laborer and capitalist were united in the same person, as in the days of individual production, there was a most complete harmony. But when these func- tions are separated, as is the case in modern industry, there is nothing but discord. The interests of one are diametrically opposed to those of the other. The wealth produced by labor, as we have seen, is divided into two parts. One portion goes to the laborers in the form of wages, the other portion is divided into rent, interest, and profit, and pocketed by non-producers. It is because the capitalist has monopolized the means of production that he is able to appropriate a portion of labor's prod- uct. It is thus that capital becomes productive. Its productivity consists in its spongy capacity of absorbing surplus-labor. This becomes clear when we glance at the nature of production. All leading industries to-day are joint-stock concerns, and a capitalist may hold stock in a score of such indus- tries. He purchases, say, $10,000 worth of stock in each PRINCIPLES OF SCIENTIFIC SOCIALISM. of these industries, of which, perhaps, he knows nothing. His broker has told him that they are paying invest ments and that is all he cares. He never goes to the factories or even to the towns in which they are located. He simply takes the stock and locks it up in his safe, and , at the end of three months receives his dividends. But where do these dividends come from ? The capitalist, surely, has not produced them. The answer is not diffi- cult to find. Take the cotton factory as an illustration. Here, say, 1000 men have worked for three months and have produced a certain amount of cotton cloth. This is transported to the market and exchanged for money. From the money received for the product there is first deducted the cost of the raw materials and the wear and tear of machinery. The balance is divided into two about equal portions, one of which is given to the laborers in the form of wages and the other portion is called profita and is divided among the capitalists in the form of divi' dends. Now, note, the whole product was created by labor; the stockholders render no service whatever. Dividends, then, arise from the fact that the laborers d& not get the entire wealth they produce. Now we have seen that the product which labor produces is divided into two portions, and it is axiomatic that a thing cannot be divided into two shares so as to increase the portion of each. If the laborer produces $6 worth of wealth a day and the capitalist keeps $3, there is only $3 left for the laborer. If the capitalist keeps $5 there is only $i left. But if, on the other hand, the laborer can secure $5 there is but $i left for the capitalist, and if, perchance, the laborer could keep all the wealth he creates, then there would be none left for the capitalist and he would have to go to work. Thus we see that as wages and iurplus-value are both parts of the product of labor, one POPULAR ECONOMIC ERRORS. 209 cannot be increased without decreasing the other, and vice versa. From this it is evident that the interests of laborers and capitalists are not identical. It is to the interest of each to get as large a portion of the product as possible. The success of one means the failure of the other. Indeed, the harmony between laborers and capitalists is like the harmony between the horse-leech and its victim, or the flea and the dog. The capitalist, like all parasites, lives off of others. Many superficial persons have been led to consider the interests of laborers and capitalists identical through a failure to distinguish between capital and capitalists. La- borers could not get along very well without capital, but they could do very nicely without the capitalists. If all the capitalists should take it into their heads to emigrate, industry would not be greatly disturbed for, in fact, the directing function once performed by the capitalist has been transferred to hired employees. In fact, we mean by capitalist, one who possesses wealth which brings an income without personal exertion. The capitalist to-day is purely a useless organ in production. We find in all nature that as soon as an organ is redundant it is elimin- ated. The capitalist must pay the penalty that nature has imposed upon all useless functionaries. We are sometimes told that if we antagonize the capi- talists they will take their capital and go to Europe. Would to Heaven they would go somewhere, but if they should we need not fear their taking their capital with them. Imagine a Vanderbilt taking the New York Cen- tral R. R. with him, or an Astor his valuable city lots ! No, capitalists may go but they will be obliged to leave the capital which they have fleeced from labor behind. But why should they emigrate? If they go to Italy they would be confronted by 40,000 Socialists, if to Holland 210 PRINCIPLES OF SCIENTIFIC SOCIALISM. by 300,000, if to France by 1,000,000, if to Germany by 2,125,000, if to Belgium by 500,000, etc., etc. There is not a civilized country to-day in which Socialism is not a growing force. The capitalist, then, cannot escape his doom by emigration. The mighty rising tide of the in- ternational Socialist movement will soon seal the doom of the capitalists. But we bear no antagonism to capital- ists as individuals, and have no objection to their remain- ing with us and becoming useful members of society. Socialism will soon establish harmony between laborers and capitalists by setting the latter at work. The antagonism between the capitalist and proletariat class is due to the contradiction between the social pro- duction and capitalist appropriation. The instruments, method and product of production are now social, but the form of appropriation remains the same as in the days of small production when the laborer owned his tools and consequently the product. The present social instruments of production are incompatable with the old method of appropriation. Social production with indi- vidual appropriation means individual appropriation of the products of social labor. Private property in the instruments of production is becoming every day more and more incongruous with the nature of those instru- ments. Thus the interests of laborers and capitalists are becoming more and more antagonistic with the develop- ment of modern industry. A failure to recognize this contradiction in the capitalist system has led to many economic errors of which this is by no means the least important. The antagonistic interests of laborers and capitalists are not incidental but inherent in our present system of industry. The apologist cannot longer hoodwink the laborers into believing that their interests are identical with those of their exploiters. The working class is beginning to POP ULAR ECONOMIC ERRORS. 2 1 1 study the economic question, which means that such errors will soon be dispelled. 3. THAT LABOR is BETTER OFF TO-DAY THAN EVER BEFORE. Those who assume that labor is better off to-day than ever before consider but one side of the problem. A comparison of labor's condition for the last six cen- turies shows many ups and downs. Its pathway has not been one of gradual progress or decline. While la- bor to-day is better off than during the last half of the eighteenth and the first half of the nineteenth centuries, it is far from regaining its golden age, the fifteenth century. The question of labor's condition must be viewed from two aspects, the absolute and the relative. Viewed from the absolute standpoint the laborer may enjoy more privileges, and those fortunate enough to secure steady employment may often have more of the necessities of life to-day than in years gone by. But viewed from the relative standpoint his condition as compared with the other classes of society it is evident that there is a greater gulf to-day separating him from the classes above him than ever before. Even where the laborer re- ceives more of the necessaries of life, he receiver/ a less share of the product than he did in the despised Middle Ages. Labor is exploited to-day more than it was then ; it is obliged to give up more of the value which it creates than in those days. Can labor really be said to be better off in the true sense when it is obliged to submit to greater exploitation ? Is labor gaining ground when its fleecings are increasing ? If any laborer is better off to-day than formerly his condition is only accidental and temporary. As a whole labor is relatively worse off, and 2 1 2 PRINCIPLES OF SCIENTIFIC SOCIALISM. even absolutely, it is not as well off as it was in 1872. The worst condition of labor, as we have already noted, was at the beginning of the nineteenth century. After awhile its condition began to improve and so continued up to the sixties, but even then it had not relatively re- gained its status of the fifteenth century. Since 1872 it has been on the downward grade both relatively and absolutely. Let us glance for a moment at statistics. In the report of the Massachusetts Bureau of Statistics of Labor for 1885 the data for nine industries are given, which show that the percentage of the net product paid as wages fell from 598/10 per cent, in 1850 to 482/10 per cent, in 1880. The compilers then take from the United States Census the same data for all industries in the country and find that 51 per cent, of this net product was paid in wages in 1850 and only 48 i/io per cent, in 1880, and say : " It appears that when the field is broadened so as to include the entire manufacturing industries of the country, labor's share' of the. net product has declined from 51 per cent, to 48 i/io per cent." A comparison of the statistics of 1890 with those of 1880 show a still further decline. The statistics of 1890 show that labor received that year but 47.03 per cent, of the net product and the capitalists 52.97 per cent. These facts show beyond controversy that labor's share in the product is not increasing, but the reverse. Now let us look at wages. I wish first to call atten- tion to the statistics furnished by the Senate Finance Committee of 1893. The Aldrich report from this com- mittee is valueless owing to its political aim. The con- ceded partisan spirit of the report necessitates throwing away the work done by the committee's experts and re- turning to the original reports made by the employers. Here we find given (see pages 110 and in) the tables POP ULAR ECONOMIC ERRORS. 2 1 3 containing wages paid in all industries in 1873 and 1891. As I cannot take the space to insert these tables I will simply give the summarized statement, which is that the average wages in urban industries in 1873 was $2.04, and in 1891, $1.69. According to the Connecticut Labor Report and the Massachusetts " Statistics of Manufac- turers," the nominal rate of wages in 1894 had declined about 7 per cent, below the level of 1892, while the yearly income of laborers had been still further reduced by the lack of employment. So much for urban industries. Now let vis look at mining. Here, also, I can give only the summary. The returns give the average wages in currency in 1873 as $2.14, and in 1891 as $1.58. The average in gold in 1873 as $1.90, and in 1891 as $1.58. Since 1891 miners' wages have constantly fallen. The Michigan Labor Re- port of 1894 shows a reduction in wages since 1890 of 20 per cent. There yet remains agriculture to be considered. Here, also, we find the same general decline. Comparing the Massachusetts Labor Report for 1872 and the Massa- chusetts statistics in the national reports mentioned, we find that agricultural wages with board in 1872 was $27.52 per month and in 1890, $18.50. In corroboration of this I wish to cite Prof. Dodge, Statistician of the De- partment of Agriculture, the highest authority on the subject, whose inquiries consists of nine statistical in- vestigations, covering a period of 26 years, from 1866 to 1893. His investigations show that the wages of regular farm labor have decreased about 31 per cent, and those of transient labor about 40 per cent. Other statistics might be cited, but these are sufficient to show the ten- dency of labor. Labor, to-day, is losing its power and becoming more and more dependent upon capital. Not only is this the 214 PRINCIPLES OF SCIENTIFIC SOCIALISM. condition of labor in general, but there has arisen a des- titute and degenerate class which is constantly growing and which is more degraded than any people in the civil- ized nations of the past. Says Prof. Commons : " A new race of men is being created with inherited traits of physical and moral degeneracy, suited to the new en- vironment of the tenement house, the saloon, and the jail. . . . The great mass of workmen, when we con- sider all their circumstances, are no better off than they were thirty years ago and many are worse off." While laborers may have gained some few advantages from the improvement which they have made (and surely it would be strange if they were not a little benefited by all they have done) still the fact remains that more work- ingmen now lack the necessaries of life than ever before. Fifty years ago the word tramp had not been coined. Trampdom is a necessary part of capitalist society. Under Socialism, where labor is pleasant and all can find employment, the word tramp would soon be forgotten, for the tramp-producing system would have bc*en abol- ished. Conditions are rapidly growing worse, and the number of the unemployed constantly increasing, and degradation and poverty stalk hand in hand through the land. 4. THAT CHEAP PRICES ARE BENEFICIAL TO LABOR. It is a common error to suppose that cheap prices are beneficial to labor. This, however, is erroneous, for the share of wealth which labor keeps as wages, depends upon the cost of the production of labor-power. The cheaper the goods, the cheaper the cost of reproducing labor-power. If the price of commodities decreases, wages will also decrease in correspondence. As long as labor-power is a commodity, its price, like that of all other POP ULAR ECONOMIC ERRORS. 2 1 $ commodities, will depend upon its cost of production. The portion of the product given to labor, like the coal placed in the fire-box, is to enable the laborer to keep up his steam. The capitalist does not part with a larger portion in either instance than is necessary to accom- plish the purpose. As the cost of labor-power depends upon the cost of the necessaries of existence, any process which cheapens these necessaries only decreases the value of the labor- power. This lessening of the necessary labor adds pro- portionately to the surplus-labor. Cheapening the necessities of life, then, is but cheapening labor-power. If, under a certain status of production, it required eight hours for the reproduction of the value of labor- power and certain improvements are introduced by which the laborer can reproduce the value of his labor- power in five hours, then three hours have been freed and added to the domain of surplus-labor. It is thus ad- vantageous to capitalists to have cheap commodities, for in this way labor-power is cheapened. While cheap com- modities are beneficial to the middle and plutocratic classes, or to those on fixed salaries, it is in no way ad- vantageous to proletarians as their wages are determined by the cost of the necessaries of life. Everyone is a consumer of necessaries, and those who produce necessaries have to produce sufficient for all. Beside the idle rich there are many other non-producers, such as servants, lackeys, and other satellites of the wealthy class. These parasites are paid by the rich out of the surplus which they have exploited from the useful producers. Of course, cheap commodities for the pro- ducers mean cheap commodities for the non-producers, consequently, wages are lowered and the larger number may be withdrawn from useful production. The smaller the number engaged in the production of necessaries the 2 1 6 PRINCIPLES OF SCIENTIFIC SOCIALISM, harder they must work, for they must produce sufficient food and clothing for all. Cheap commodities, then, are not beneficial to the laboring class. They tend to de- crease wages, intensify labor, and increase exploita- tion. To recapitulate : our present system makes of labor- power a mere commodity, and being such its price is controlled by the law which determines the price of all commodities. The price of commodities is determined by that which is necessary for its production. Whatever lowers the price of the elements which enter into a com- modity lowers the price of the commodity. The laborer needs food and clothing that he may place his labor- power upon the market, and whatever lowers the price of these requisites lowers the price of labor-power. Cheap goods means cheap labor-power. Consequently, that which lowers prices is not beneficial to labor. 5. THAT FOREIGN MARKETS ARE BENEFICIAL TO LABOR. This is a common error. We frequently hear people sounding the praises of American industry and rejoicing that our products are going all .over the civilized world. The cry is constantly raised, " Give us more foreign markets." But it is all a delusion. I protest in behalf of the unfed, half-clothed, and homeless millions. Why should we rejoice at the spectacle of our machinery, cot- ton cloth, food products, etc., going all over the world ? Where do these goods come from ? Every dollar's worth is wrung from the honest toil of labor. All such products represent surplus-value which has been appro- priated from the product of the workers. We do not want foreign markets for the goods thus wrung from POPULAR ECONOMIC ERRORS. 2I/ productive toil. What we do want is that these goods produced by labor shall go to labor. If every man re- ceived the full product of his toil there would be no need of a foreign market. It is the business of this na- tion to first satisfy the wants of its own people. The cry for foreign markets is the cry of a vicious system of industry. It fleeces the laborer of the wealth he creates and then seeks an outlet for the surplus abroad. The greater our success in this direction the greater the ex- ploitation of labor and, consequently, the more poverty and degradation at home. The whole policy is infamous, born of the necessities of an infamous system of produc- tion. How long will the laborers rejoice at the oppor- tunity of capitalists to sell foreign countries the bread and butter out of their own mouths. The search for foreign markets is the height of all follies. Suppose we secure them, could they be retained ? China, Japan, and India are now adopting all our inven- tions and improvements, and will soon not only produce for themselves but will become our competitors. The only way foreign markets can be secured and retained is by producing cheaper than others. This means a con- stantly lowering wage, even below the pauper wages of Europe; it means a wage lowered to the level of China, Japan, and Hindoostan. But as wages decrease, so does the consumptive power of labor and, conse- quently, as foreign markets extend, home markets con- tract. Foreign markets, then, so far as labor is con- cerned are truly a snare and a delusion. The cry for them is the death gasp of the competitive order. Foreign markets are of no benefit whatever except to add to the profits of the profit seekers. Why should laborers be deprived of the blessings of life, deprived of an opportunity to read a book, to take a journey, to enjoy a social hour, simoly that they mav create wealth 31 8 PRINCIPLES OF SCIENTIFIC SOCIALISM. to keep others in idleness. Thus it will ever be until la- borers learn to combine and produce goods for their own use instead of profits for others. Be not deceived by the cry for foreign markets. It means the exploitation and degradation of labor. 6. THAT LUXURY is BENEFICIAL TO LABOR. It is frequently said that the luxury of the rich is beneficial to labor because it gives employment. This apology for luxury presupposes that what laborers want is work, whereas it is not work but the results of work that is desired. This effort to justify luxury is somewhat obselete. Those making it fail to realize that philan- thropic and productive expenditures also give employ- ment to labor. The mere fact that the expenditures in luxury give employment to labor is not sufficient to jus- tify such expenditures. What we want to know is the result of such employment. To be sure, the payment of wages in the production of luxuries helps the workers who. receive the wages, but such employment is of no help to society. The only way to help society is to give laborers useful employment. To employ labor in the pro- duction of luxuries is a misdirection of human energy. But these laborers, although they cease to produce necessaries, must still consume them. This means that those engaged in useful employment must work just so much harder or so much longer, for while the consumers remain the same the producers have been reduced. But where do the rich get the money they spend in luxury ? They fleece it from the workers. The portion of the prod- uct which the present system enables them to appro- priate is more than sufficient to supply their necessities, so the surplus is expended for luxuries. The more the rich spend in luxury the more men will be withdrawn POPULAR ECONOMIC ERRORS. 219 from useful production, and the more laborers will be exploited to furnish the means of payment. Remembw, it is the useful worker that keeps both the rich and their flunkeys. The more consumed by these classes the more laborers have to produce, or else the less they themselves have to consume. The only result of spending money upon luxury is the destruction of a large amount of wealth and the waste of a large amount of labor. Lux- ury, then, is not beneficial to labor. 7. THAT LAND NATIONALIZATION WOULD SOLVE THE SOCIAL QUESTION. This is the single tax theory as set forth by Henry George. Space will not permit an examination and refutation of all the fallacies contained in this theory. I can only refer, in a general way, to the main assumption. The adherents of the single tax theory fail to recognize that land and capital are both requisite to production, consequently, they have failed to perceive that the na- tionalization of one would still leave the people at the mercy of the monopolizers of the other. As a matter of fact capital is the chief factor in modern industrialism, and the monopolization of machinery would render nugatory any good results that might otherwise accrue to the people through a socialization of the land. Suppose laborers to-day had free access to the land, would that enable them to build their own factories and equip them with modern machinery ? If so, why does not the small land owner who finds farming unprofitable, construct a factory and engage in the production of some commodity ? Simply because he has not the capital to enable him to do so. His possession of the land does not enable him to enter the field of industry and com- pete with the large capitalist. II land were nationalized 220 PRINCIPLES OF SCIENTIFIC SOCIALISM. would he then be any more able to engage in industry which requires an ever-increasing capital ? Surely not. Land nationalization would not open the door of indus- trial employment to a single individual. Nor is this all. A man would be no better off in agri- culture, for here also capital has become necessary to successful production. The man with the large capital, able to equip his farm with the best steam and electric machinery, has an advantage over the small farmer who is obliged to use inferior tools. Were every man to ob- tain his land free, and as much as he desired, it would still remain true that only the man with large capital at his disposal could successfully utilize it. Unless it can be shown that under the single tax the man with large capital would not have an advantage over the small farmer, the supposed panacea must prove futile. The fact is, agriculture, like manufacturing, has been revolutionized. Agriculture, to be sure, is slower in its development, but its tendency is toward the downfall of the small agriculturalist. The small farmer is unable to compete with the bonanza farmer, who can produce more cheaply and plentifully. The single tax would not alter this relation. It is claimed that under the single tax no one would be able to secure more land than he could productively use. Be it so. The changed methods of agriculture makes it more profitable to work farms of one hundred thousand acres than of one hundred acres. If a man has the capital to equip land with modern ap- pliances there is no end to the quantity of land which he can productively use. If, as under the single tax, land could be had gratuitously; that is, by paying to the State its rental value, a corporation might be formed to cultivate all the arable land in the country. At least, it is certain, the proletarian would have no chance, for without unlimited capital, agriculture would be out of POPULAR ECONOMIC ERRORS. 221 the question. The single tax, then, by placing land at man's disposition would be no solution of the social prob- lems, for without the needed capital he would be unable to successfully cultivate it. Socialists, of course, concur in the demand for land nationalization, but dissent from the proposition that this alone would remedy social ills. The fact is, Mr. George completely overlooks the changed methods of production. To be accurate, land is but one form of capital. Let this be understood and it will be clearly seen that the abolition of but one form of capital will effect no relief. Every reason given by Mr. George for the nationalization of land applies equally to all the means of production. Land stands related to production as other forms of capital. To separate it from capital is only to confuse. The product of production is divided into two parts, wages and surplus-value. It makes no difference by what terms the return for the use of capital may be expressed. We may call the re- turn for capital invested in land, rent; from capital loaned as money, interest; from capital employed in business, profits ; or from capital invested in stocks, dividends ; it is all the same. All returns from capital represent surplus-value and should be abolished. To simply abolish the returns from one form of capital would not remove the evils of capitalism. The single tax is insufficient to remedy the evils from which we suffer. It does not pretend to touch the wage system and competition, the real causes of servitude and industrial crises. Socialism is the only remedy. Capital in all its forms must become the property of all the people. 222 PRINCIPLES OF SCIENTIFIC SOCIALISM. 8. THAT EXTRAVAGANCE is THE CHIEF CAUSE OF ECONOMIC WANT. Another common error is the supposition that extrava- gance is the chief cause of economic want. While in many instances this may be true, it is erroneous to sup- pose that the checking of extravagance as a whole would remove the evils of our present system, of which poverty is the greatest. Individuals gain by saving, but were all to practice economy the few would lose their advantage. This is readily seen when we realize that production can only be sustained by consumption. Now the laborer by the expenditure of his whole income is able to purchase but about one-fifth of the value of his product. It is due to this exploitation of labor that we have the phenomena called over-production. This congestion of the markets, then, is inevitable, even with the utmost extravagance. But now suppose the laborer saves, say, fifty per cent, of his wages. Is it not seen that under such conditions the markets would be more glutted than ever ? The result of such a state is always business depressions and crises, with their attendant suffering and want. Factories are shut down and production is suspended, for the sim- ple reason that there are more goods than can be profit- ably disposed of. The less the people consume the more quickly this condition of things is brought about. As a matter of fact our industrial system would not be able to run at all were people to save any considerable portion of their incomes. If it cannot proceed but a few years at a time, even with the extravagant expenditures, what would be the result were the consumptive power of the people checked by economy ? The only salvation for the present order is in extravagance, in teaching the POPULAR ECONOMIC ERRORS. 223 people to live out their entire income, and so, as far as possible, relieve the congested markets. The whole fallacy lies right here. It is seen that cer- tain individuals by parsimony accumulate property, and it is thought that if all were parsimonious all would be equally benefited. But this does not follow ; the few now gain at the expense of their fellows. The great majority spend their incomes and so keep production in motion, thus giving employment to the ones who are saving, who in turn lay aside a portion of' their wages and so are benefited. But were all to save, production, which can only be sustained by consumption, would cease, thus depriving our parsimonious friends of further employment. They would then have no alternative but to consume their accumulated store, which, when gone, would leave them destitute. Nothing can save from economic want which does not stimulate production and promote industry. To have all abstain from consumption is certainly a poor way to promote industry. If goods cannot be sold they cannot be produced, and they cannot be sold unless people buy them. The less they buy the less will be produced, and consequently, the less labor will be employed. When labor is not employed there is economic want. Just to the extent, then, in which the principle of saving is re- duced to practice will people as a whole suffer economic want. To check extravagance so far from mitigating economic want would greatly augment it. It is not my purpose here to discuss the causes of economic want, that has been done elsewhere, but only to point out the fallacy of attributing the cause to extravagance. 224 PRINCIPLES OF SCIENTIFIC SOCIALISM. 9. THAT SOCIALISM WOULD THWART INVENTIONS AND IMPROVEMENTS. It is another economic error to suppose that Socialism would thwart inventions and improvements. It is rather the vested interests of the present system that antagonise and thwart all progress. The personal interest of each individual is bound up in his particular occupation and calling. If he be a capitalist, his capital is embarked in it; if an artisan, the knowledge of his craft. In each instance his interest and consequent livelihood is dependent upon his special business. The introduction of any new invention which dispenses with that occupation means ruin to those in- volved, the capitalist loses his capital and the workman loses his means of livelihood. If the 'laborers had the power they would make short work of those improve- ments which have supplanted their respective crafts and left them upon the streets begging for bread. The opposition on the part of the capitalists, though less vio- lent is more effective. As the initiative in production comes from the capitalist he is not disposed to intro- duce an innovation which will render obselete the ma- chinery in which his capital is already invested. The only condition upon which he will embark in the under- taking is the full assurance -that the invention will make up for the loss of the capital already invested. ,/The capitalist often finds its advantageous to purchase the patents to keep them off the market, for fear some com- petitor will introduce them and thus secure an advan- tage. The stories of the rebuffs and difficulties that in- ventors have to contend with in getting their inventions introduced are indeed pitiable. And if they succeed it is only by relinquishing nearly all the hopes of profits. POPULAR ECONOMIC ERRORS. 22$ In many fields machinery would be used to-day to do disagreeable work were it not cheaper to exploit a helot class. Under Socialism there would be no such obstruc- tion to the introduction of improved methods. Says Prof. Ely : " It can hardly be questioned that under Socialism the inventive powers of man would be stimulated to provide machinery to do disagreeable work, and to render work now disagreeable as agreeable as possible. The inventive power of man now aims to increase the earnings of capital, and not chiefly to render the task of the toiler as light and pleasant as possible. ... It is true, however, that in proportion as you make men valuable, machinery does disagreeable work. " Now, it is the essence of Socialism to insist upon the value of man ; and it is evident that this new order could not fail to result in a new class of inventions and dis- coveries." Another reason why there is not more progress in this direction to-day is the fact that our present system is not favorable to the development of genius. There are men of genius, men equipped and endowed by nature for such careers, men intended to be poets, artists, phil- osophers, inventors, but to whom the development of their talents is forbidden by an economic system which deprives them of the opportunity and necessary leisure for the development of their powers. We find men liberally endowed among the very dregs of society. So- cialism would secure to all the conditions requisite for the unfolding of this latent force. If a man to-day de- velops his creative powers he must be exceptionally en- vironed. For every ray of genius that is manifested there is a wealth of capacity stifled, which, if allowed to unfold, would fill the world with unbounded glory. There has been great progress in this direction, but not a hundredth part of what would have been accomplished 226 PRINCIPLES OF SCIENTIFIC SOCIALISM. had workmen the leisure and means to have developed their ideas. All progress has been in spite of an adverse economic order. Surround men with a suitable environ- ment and genius would go forward by leaps and bounds. This fact is recognized even by the critics of Socialism. Prof. Graham, in speaking of the higher education which all would receive under Socialism, says : ' The generality would receive a higher education than now. . . . And as this general light and culture would be wider and deeper, it would awaken and ripen the seeds of genius which now never get an opportunity; it is therefore highly probable that originality would, on the whole, be greatly increased. Certain it is that new veins of originality and genius would be struck in the virgin soil of the hitherto uncultivated minds of the mass which would yield rich results." Genius is not rare, as some seem to suppose, it is universal. It only lacks cultivation. Every person has- natural talent for some one thing. Socialism would find out this talent and develop it. With this develop- ment would come increased inventive genius, and a new era of mechanical improvements would dawn that would far surpass even the dreams of the most enthusiastic. Socialism would substitute machines for men in every department of production. In the Co-operative Com- monwealth steam and electricity would do the work. These do not tire and cannot be brutalized. Socialism, then, instead of thwarting inventions and improvements, would inaugurate a new era of mechanical progress, the possibilities of which are undreamed of to-day. 10. THAT SOCIALISM WOULD DESTROY INDIVIDUALITY, Another economic error is the supposition that Social- ism would destroy individuality and make everybody POPULAR ECONOMIC ERRORS. 22/ alike. The reason for this inference is not clear, although it must be admitted to be typical of this age in which men are reduced to a money valuation. The assumption seems to be that any movement toward economic equality would destroy individuality. This, however, is the re- verse of the fact. Is it true to-day that those receiv- ing equal incomes are monotonously alike ? It is rather inequality which suppresses individuality and p ompts imitation of superiors. This tendency toward uniformity is due to the lack of equality in economic con- ditions. The inferior classes strive to imitate the superior classes in order to avoid an apparent social inferiority. The result is, society is continually run in the same groove. On the other hand, any system which would tend to decrease economic inequality would tend to kill imitation. Just in proportion as men become equal they cease to gain by imitating each other. It is always among equals that we find true independence. Thus the levelling process, as it is sometimes called, is not one of men but of opportunities. It is only when men stand upon the level of equal opportunities that the differences in human endowments are manifest. So long as men are surrounded by artificial conditions and op- portunities, due to present economic inequality, .it will be impossible to tell what differences are natural and what are due to the artificial environment. Socialism, which guarantees equality in opportunity, is the only condition under which true individuality can be de- veloped. In fact, originality and independence can only be secured when all are guaranteed the bases of liveli- hood. Before men can really live they must be freed from the struggle to live. A system must be judged by its ability to procure the development of the individual. Judged by this standard our competitive order stands condemned. What oppor- 228 PRINCIPLES OF SCIENTIFIC SOCIALISM, tunity has the average worker for development ? Take the toilers in the sweatshops, the toilers on mortgaged farms, the delvers in mines, the millions of the unem- ployed, where is their opportunity for individual de- velopment ? No, it is not Socialism but capitalism wm'ch deprives men of individuality and initiative. The man who for ten hours a day sacrifices the best that is in him to the exactions of our industrial life has no time left to develop his higher individuality. Who has the greater opportunity to develop his individuality, even under the present system, the man who works for the government or the one who works for a private capital- ist ? The rush for governmental positions answers the question. Under Socialism all would have opportunity to develop, and individuality, for the first time, would be free. Socialism would destroy this false individualism in order that true individuality might blossom in its full- ness. CONCLUSION. 229 CHAPTER XIV. CONCLUSION. THE growth of Socialism has been phenomenal. It has swept with amazing rapidity over the civilized coun- tries of the globe. It is a world-wide economy, based upon universal principles, and destined to usher in a higher state of civilization. This consummation is sure of attainment, but it may be hindered by measures designed to resuscitate the old order out of which we have evolved. While we are ever ready to give our support to any movement which is a step in advance, we refuse to be a party to any effort to bring back the past. Our work is progressive the bringing in of the new order by helping forward the economic evolution. To-day the forces of retrogression are battling with the forces of progress. It is a question every man should ask himself, Which side am I upon ? The situation is becoming more and more serious every day and the signs of revolution are manifest to the careful observer. Whether the coming revolution shall be by ballots or bullets depends upon the education of the masses on the social question. Socialists have a great responsibility resting upon them. Into their hands has been committed the new gospel. By faithful and diligent effort they may avert the danger which threatens the twentieth century. This danger lies in an unintelligent resentment of wrongs that are not distinctly understood. If men resent social 230 PRINCIPLES OF SCIENTIFIC SOCIALISM. wrongs without thoroughly comprehending their nature, it may result in civil war and the reestablishment of so- ciety, but without any marked improvement. Socialists, and Socialists alone, have correctly diag- nosed the cause of the present evils and prescribed the true remedy. It is their mission to carry the gospel of emancipation to others to be missionaries of progress and civilization. It is chiefly into the hands of the prole- tariat that this commission is entrusted. The proletariat includes all who do not possess property in the instru- ments of production. While individual members of the proprietor class here and there may apprehend the truths of Socialism and lend themselves to the cause, still, as a class, we need not expect them to take the initiative or aid in carrying forward the movement for the abolition of the present system of industry. The economic struggle is necessarily a class struggle, a struggle between the proprietor class and the non-pro- prietor class. The subjection of the working class is due to the fact that the instruments of production and dis- tribution are the private property of another class. The interests of these two classes being diametrically opposed a class struggle is inevitable. The proletariat must work out its own salvation and the triumph of the proletariat means the triumph of Socialism. The proletariat is bound to put an end to its own exploitation and the only way by which this can be accomplished is by the abolition of the private ownership of the instruments of production and distribution. The emancipation of labor can only be wrought by a united effort of wage-earners along the line of their class interests, assisted by such members of the other classes as understand the economic question and possess sufficient moral courage to be true to their convictions. That this struggle for freedom should express itself CONCLUSION. 231 in political action is inevitable. Class interests always express themselves in class politics. As the laborer seeks to better his condition he comes in conflict with the gov- erning power which is in the possession of the capitalist class. The ruling class of all ages has always determined the form and administration of government, as well as fashions and customs, codes of ethics, etc., and always in its own interest. The capitalist class is to-day the ruling class, having wrested the governing pov/er from the old landed nobility, and wherever labor seeks its rights it finds itself thwarted by this class under the disguise of government. To-day the courts, the laws, the press, the legislatures, the police, the state and national troops, and often the pulpit, are dominated and controlled by this ruling class. This condition makes it necessary for the proletariat to master the governing power. An intelli- gent use of the ballot on the part of the working class would gain for them the control of the political power. In the effort to achieve this end, accept no political pal- liative. Any measure which does not tend to the aboli- tion of the wage system is unworthy of support. The laboring class must learn that it need expect nothing from any political party that does not stand squarely upon the Socialist demand to wrench from the exploiting class the political and economic weapons of exploita- tion. No such uncompromising demand as this will ever be made by any of the political divisions of the capitalist class. If the laborers are to achieve their end they must stand united in the political field on a platform of their own, demanding the complete abolition of the exploiting system. There are thousands upon thousands of workers who, to-day, are thus standing, conscious of their class interests and endeavoring to bring about the fulfillment of the mission which the economic evolution has assigned to them. To-day we see the manual and 232 PRINCIPLES OF SCIENTIFIC SOCIALISM. mental laborers of the world, uniting in mighty class- conscious bodies, preparing themselves for the duties and responsibilities of the final work in economic and social evolution. Have you joined this great army in the uni- versal struggle for freedom ? If not, why not ? Why longer waste your efforts in the old political parties which are but handmaids of the capitalist class ? Their chief object is to divide laborers into various factions, fighting against each other, and so prevent the laborers from uniting to secure their freedom. The petty politi- cal issues which such parties raise are only for the pur- pose of fleecing the laborers on the one hand and throw- ing dust into their eyes on the other lest they see the only real question at issue Socialism vs. Capitalism. Be not deceived ! Laborers, you have no interest in the success or failure of parties composed of classes whose interests are antagonistic to your own. Do not throw away your ballot then by voting for that which you do not want. As has been well said, " You had bet- ter vote for what you want and not get it, than vote for what you don't want and get it." But, friends, we shall get what we want. Socialism is the outcome of industrial evolution. That Socialism will follow capitalism is as certain as that light will follow darkness. Its speedy realization depends upon the faithfulness and devotion of those who have seen the light. Its advent, however, is not so far distant as often thought. The rapid growth of the Socialist vote evidences that salvation is nigh. We are blessed, in that the opportunity is ours to help usher in the brighter day. No people ever had a nobler cause, or one that should inspire greater enthusiasm. THE END. INDEX. A. Agriculture, planless method of, 69, 70 ; economy of, under Socialism, 70, 71 ; wages in, 213; changed conditions of, 220. Altruism, law of, 161-163. B. Bascom, John, on divorce, no; on the wage system, 124. Baumgarti, on economy of com- bination, 192. Bebel, on economic oppression, 26. Blachford, Robert, on genius, 172. Buckle, on reform, 28. C. Capita), use of, in production, 37-39; constant and variable, 193; how preserved, 144, 145. Capitalists, origin of, 1 1 ; down- fall of small. 22 ; superfluous, 23, 38, 126, 143, 209; interests opposed to laborers, 207-210, 62 ; Socialism beneficial to, 94-97- Capitalism, conditions requisite to, ii, 12; origin of, 12-15; unchristian, 105; destroys in- dividuality, 227, 228. Carlyle, on liberty, 138. Casson, Herbert, on paupers and millionaires, 123. Children, care and training of, 87-89. Civilization, law which has made for, 161-175. Class Struggle, 28-34, 210, 230- 232. Commons, Prof., on the home, 86 ; on crime and intemper- ance, 115, 117, 119; on the condition of labor, 214. Communism, early form of, 10. Competition, elimination of, 24, 25, 169; wastes of, 67-83; selfishness of, 102, 103 ; evils of, 165-169, 174. Crises and Industrial Depres- sions, 176-190. Crime, elimination of, 114-116. D. Demand and Supply, 40-42, 150. Directors, efficient, 89, 90. Dishonesty, abolition of, 106- lio. Divorce, restriction of, no, in. Distribution, method and econ- omy of, under Socialism, 71- 74- Dividends, origin of, 208. Dodge, Prof., on agricultural wages, 213. [233] 34 INDEX. E. Education, present system hos- tile to, 87, 88 ; Socialism fa- vorable to, 226. Elizabeth, Act of, 15. Ely, Prof., on the industrial re- volution, 18; on early Ameri- can industry, 20 ; on demand and supply, 41 ; on tele- graphs, 79 ; on advantages of Socialism, 101 ; on divorce, in; on intemperance, 118; on industrial depressions, 189; on new inventions under So- cialism, 225. Environment, importance of, 108-110. Errors, popular economic, 200- 228. Extravagance, not cause of want, 222, 223. F. Family, origin of, 9, 161 ; de- struction of, 85. Fawcett, Prof., on farming, 71. Feudal Lords, impoverishment of, 13; usurpation of, 14. Feudalism, 10, n. Foreign Markets, capitalist need of, 186-188; not beneficial to labor, 216-218. G. George, Henry, on value, 39, 40. Genius, 172, 225, 226. Godard, George, on poverty, 124. Golden Age, only possible under Socialism, 104, 105. Government, simplification of, 93, 94- Gladden, Dr., on wages, 156. Graham, Prof., on education under Socialism, 226. Greed, not cLief motive of man, 171-174- Gronlund, L., on Denmark courts, 74. Guilds, suppression of, 14. Gunton, George, on function of capita], 38 ; on supply and de- mand, 41 ; on intemperance, 119. H. Handicraft, period of, 10, 19. Henry VIII., crimes against la- bor, 13, 14. Herron, Dr., on competition and civilization, 162, 169. Hertzka, Prof., on economy of Socialism, 77. Holmes, G. K., on concentration of wealth, 30. Human nature, not bad, 108, 109, 171. Hyndman, H. M., on sale of labor-power, 200. I. Immigration, effect of prohibi- tion of, on labor, 196. Incentive to labor, under Social- ism, 170-175. Individuality, not destroyed by Socialism, 226-228. Industry, period of small, 10, n, 19; manufacturing, 15, 16, 19; modern, 16-22, development of modern, 22-27 ; evolution of, 9-34; motives to, 170-175; revolution of, 16-19. Intemperance, prevention of, 1 16-121. Insanity, cause of, iio-I2I. Interest, 142-147. INDEX. . Inventions, early, 16, 17; new, 196-198 ; use of, under Social- ism, 198, 199, 225; not thwart- ed by Soaalism, 224-226. J- Joint Stock Companies, origin of, 22, 23 ; extent of, 143, 227. K. Kerr s Dr., on intemperance, III. L. Labor, wage, origin of, n; gold- en age of English, 13; down- fall of, 15,25, 26; emancipa- tion of, 26, 27, 32, 139, 1 60, 230-232 ; source and measure of value, 36-41 ; meaning of social, 42-45 ; necessary and surplus, 61 ; compensation under Socialism, 43; exploi- tation of, 53-65, 183-185, 200- 203, 208; relative condition of, 63, 111-114; quality of, de- preciating, 150, 151 ; motives to, under Socialism, 170-175; displaced by machinery, 196- 198. Laborers, cause of servitude, 25, 26, 128, 132-139, 157- 159; Socialism beneficial to, 97-101 ; not usefully employed, 126-128 ; interests opposed to capitalists, 207-210, 62; dis- placed by machinery, 196- 198. Labor-power, sale of, 58-60, 137, 202; value of, how determined, 58-64, 149-157, 214-216; use and exchange value of, 59, 60, 200-203. Land, private ownership of, 14 r, 142; nationalization of, no solution of social problem, 219-221. Legislation, cause of, 93, 94. Luxury, not beneficial to labor, 218, 219. M. Machinery, function of, in pro- duction, 38, 39, 56-58 ; effect of improved, on value, 47,48; problem of labor saving, 191- 199; effect of, on laborers, 195-198 ; use of, under Social- ism, 198, 199, 225, 226. Mauufacturers, origin and period of, 15-19. Marx, on the machine, 17, 18 ; on transition to Socialism, 34 ; on measure of value, 41, 48; on supply and demand, 41 ; on skilled labor, 43 ; on sur- plus value, 53; on cost of liv- ing, 150. Maybell, Stephen, on legislation, 94- McCulloch, on value, 37. Middle Class, downfall of, 21-33; bound to present system, 33, 230. Monetary Question, solution of, 91, 92. Morris, William, on competition, 168. O. Over-production, 69, 177, 180, 185, 187, 188, 222. P. Parsons, Prof., on progress, 163. Peasants, revolt of, 12- expro- priation of, 13-15. INDEX. Philips, Wendell, on emancipa- tion of labor, 28. Poverty, cause and cure, 122- 131- Political action, necessity of, 32, 1 60, 230-232. Prices, how determined, 40, 41, 55, 201-206; cheap, not bene- ficial to labor, 214-216. Production, individual, 11; early form of, 9-11, 177; manufac- turing, 15, 16; modern me- chanical, 16-34; social, 26, 27, 210; capitalist and labor cost of, 64, 65, 200-206; to- day and under Socialism, 66- 71, 178-183. Progress, law of, 161-175. Proletariat, origin of, 13-15; mission of, 28, 29, 32, 230, 231. Prosperity, under capitalism, 1 88, 189. Prostitution, prevention of, in 114. R. Rent, 140-142, 146, 147. Ricardo, on value, 37 ; on sup- ply and demand, 40 ; on qual- ities of labor, 44 ; on price ol labor, 149. Risk, compensation for, 143, 144. Rodbertus, on value, 36, 37 ; on wages, 156. Rogers, Prof., on English labor, 13- Ruskin, on right to property, 128; on slavery, 1 36 ; on re- ward of abstinence, 144 ; on government and anarchy, 175. S. Sanial, Lucian, on distribution of wealth, 30, 31 ; on chil- dren employed, 88. Sanborn, Edward, on commer- cialtravele rs, 76. Standard of living, meaning of, 152-158. Savage, Rev. M. J., on progress, 163. Schaffle, Dr., on money under Socialism, 91. Selfishness, abolition of, 102, 103. Serfdom, 10-12. Servitude, cause of, 26, 128, 132-139. Shearman, T. G., on wealth concentration, 30. Slavery, origin of, 10; wage -vs. chattel, 132-139 ; meaning of, 135- Smith, Adam, on labor and value, 50. Social Labor Day, meaning o, 45-47- Socialism, advantages of, 66- 101 ; not governmentalisM. 93 ; beneficial to capitalists, 94-97 ; beneficial to laborers, 97-101 ; evidences of the moral strength of, 102-121; its spirit and aim, 102-106; motives to work under, 170- 175; numerical strength of, 109, no. Sprague, Rev. F. M., on ab- stract labor, 42. T. Taussig, Prof., on early Amer ican Industry, 21. Taxation, abolition of, 92, 93. Toynbee, Prof., on pauperism of the i6th century, 14. Trusts, origin and meaning of, 23-28 ; economy of, 192. U. Utility, meaning of, 35, 36. INDEX. 237 V. Value, analysis of, 35-52, 200- 206 ; how effected by machin- ery, 38, 47, 48; use and ex- change, 35, 36, 49, 50, 53; not a relation between ex- changeable things, 39-41 ; source and measure of, 36- 4 r > S^, 575 unit of, under Socialism, 45 ; present unit of, 51, 52; surplus, origin of, 53-65, 201-203. W. Wages, law of, 148-162; mean- ing of, 148, 149; average rate of, 212, 213; how determined, 58, 59, 149-157, 214-216; ef- fect of supply and demand of labor on, 150. Wastes of capitalism, from pro- duction, 67; from distribu- tion, 71; from useless voca- tions, 74, 126-128; from rail- ways, 78; from telegraphs, 79 ; from gas plants, 79 ; from electric light, 80 ; from enforced idleness, 80 ; from strikes and lockouts, 81 ; from needless charity, 83 ; from idle consumption, etc., 83, 165-- 169. Wealth, concentration of, 29-31. Webb, Sidney, on the Joint Stock Co., 23. Wells, on cost of wheat produc- tion, 71. Willard, Francis E., on the so- cial evil, 112; on intemper- ance, 1 20. Women, elevation of, under So- cialism, 84-87. Woolsey, Dr., on crime undex Socialism, 115. 43 DATE DUE PRINTED INU.S. A. u 524 022 /