REESE LIBRARY / OF THE UNIVERSITY OF CALIFORNIA. Class THE RETURN TO THE LAND THE RETURN TO THE LAND BY SENATOR JULES MELINE LEADER OF THE MODERATE REPUBLICANS IN FRANCE J FORMER MINISTER OF AGRICULTURE ; MINISTER OF COMMERCE J PREMIER WITH A PREFACE BY JUSTIN MCCARTHY NEW YORK E. P. BUTTON AND COMPANY 31 WEST TWENTY-THIRD STREET 1907 PREFACE THIS book seems to me destined to make a deep mark upon the age. Senator Jules Meline, leader of the Moderate Republicans in France, was Minister of Agriculture in the Cabinet of Jules Ferry from 1883 to 1885; was elected President of the representative chamber of France in 1889; and in 1896 became Prime Minister an office which he resigned not long after, having found probably that his political views were not radical enough for the public opinion of the country. The book is remarkable in every sense. With all its practical teaching, with its minute and careful instruction on manu- facturing and industrial questions, there is not a dull page in it from first to last. M. Meline has much of the feeling of the poet as well as the reasoning power of the practical and the scien- tific teacher. Even where the reader may not accept all the principles of political economy on which M. Meline founds many parts of his case, that reader, if he have an appreciative mind, cannot fail to admire the sincerity, the power, v 166144 Preface and the persuasiveness of the author. The great object of the book is to convince the world that the return to the land, and to the work which the land still offers in all or most countries, is now the nearest and the surest means for the mitigation or the removal of the troubles which have come on the working populations every- where, and that the present is the appropriate time for the beginning of such a movement. In his opening chapter the author tells us that the most remarkable feature of the nine- teenth century is the immense development of the manufacturing industries. " Manufacture to-day," M. Meline justly declares, "is as different from what it was a hundred years ago as are our social institutions from those of the Middle Ages." Within less than half a century this great change lias taken place, and M. Meline says that the change was inevitable " from the moment when science made its way upon the stage of primitive industry, ever turning until then in the same circle, ever running in the same grooves." The limits of production were naturally and inevitably fixed according to the number of men and women able to give manual labour enough in each particular region for the supply of the products which it required. The author follows out the course of this world-wide vi Preface change, or rather new development, in a series of descriptions which are no less vivid than careful and accurate. The reader who begins this volume with nothing more than a creditable desire to learn something about the development of manufacturing industry here, there, and every- where, soon finds himself absorbed in M. Meline's exposition as much as if he were reading a story of magic from the "Thousand and One Nights." Before the recent stage of manufacturing de- velopment which belongs to our own time, England, well supplied as she was by nature with iron and with coal, should have become the foremost industrial country in the world, and by far the largest exporter of manufactured products. I may, perhaps, become so much of a critic just here as to find some fault with M. Meline. I think that he is not quite fair to England and her governments in his manner of dealing with the effects of the famous Treaty of Commerce between this country and France. " For a moment," M. Meline says, "it seemed as though England were disposed to let France have a share in her prosperity ; but we soon discovered that we had been merely the cat's-paws of our more powerful neighbour, and that, instead of finding our way into her field, it was she who vii Preface was finding her way more and more into ours." But surely it is evident that the sole reason for this result is found in the fact that England pro- duced manufactured goods which France desired to have, and that she allowed France to have them on the easiest terms. Richard Cobden, who with Michel Chevalier, the great French econo- mist, began and conducted the negotiations for the Treaty of Commerce, was a sincere friend of France as well as of his own country, and as the writer of this review personally knows, had the interests of France deeply at heart while he was pressing the treaty on the attention of his own government. Then with the growth of scientific machinery, came the desire among all nations, as M. Meline puts it, " to defend themselves against foreign competition " by the effort to manu- facture for themselves all the goods which they most wanted, and, by import duties, to protect themselves against foreign competition. M. Meline naturally shows himself all through his volume a genuine Protectionist, but I feel well assured that the most convinced Free Trader among his readers will not feel any grudge against him merely because he stands by his own economical principles, inasmuch as through the whole of his work his evident resolve is to state with absolute fairness the facts on which viii Preface he rests his case. The universal passion for the development of native industries, and its suc- cessful working almost everywhere, led naturally and inevitably to a rivalry in exportations. The countries which were successful in this work of production soon found that they could make more goods than were needed at home, and became therefore inspired with the desire to find purchasers in foreign markets. In this new movement the United States led the way. The States fortified themselves with prohibitory duties against other nations, while at the same time making it clear, according to my judgment, that no such protective ramparts were needed. The United States have lately become by far the largest exporters among all the countries of the world ; and not only that, but their exports approach very nearly in amount, and in some industries actually exceed, the combined products of all other parts of our globe. A remarkable fact about this immense increase in American productions is that the United States have not sought out new and unoccupied markets, but have "resolutely at- tacked the markets of Europe those which were already being best worked those of France and Germany and England herself." M. Meline also attaches much importance to ix Preface the sudden and rapid development of Japan in the promotion of its great manufacturing indus- tries. Japan has become within the last few years almost unrivalled in her production of oil, of cotton goods, and of silk. The astonishing and utterly unexpected successes Japan made as a military power were, M. Meline declares, " merely a prelude to the economic conquests which await her, and on which she counts ; for she had this in view when she undertook the war, and her struggle with Russia was but a proof of her intention to capture the Asiatic market, and to remain master of it." A new struggle is therefore opening up among the nations of the world as regards the production of manufactured goods. Such a contest must, of course, lead to depressing and even ruinous rivalries here and there, and must, M. Meline believes, bring thinking men to the conviction that there is some other element of national pro- ductiveness which must be called into develop- ment in order to maintain any permanent remedy for increasing poverty, and increasing and heedless emigration. This is the conclusion at which the author of the book arrives, and the remedy he calls for is that return to the land which gives a title to his volume. M. Meline is an enthusiast about this return to the land. He Preface regards the occupation and cultivation of the land in every country as one of the healthiest and most hopeful conditions in which men and women can be brought up. He lays especial stress on the improvement which can be wrought in the condition of working women everywhere by the cultivation of the land on which they live. The business of market gardening may be made not merely a profitable occupation for women, but a means of developing their intelligence, their culture, and their self-respect. While much of the mechanical work which furnishes a means of bare livelihood to the women of all our populations has often to be performed under conditions detrimental alike to physical health, and to mental and moral development, the return to the land, to the cultivation of market gardens, to the bringing-up of flowers, and the study of plants, would render woman in every sense a helpful and improving companion to man. We can hardly think of Hood's melancholy verses, " The Song of the Shirt," as likely to have any illustration to be found in woman's labour to cultivate the soil on which her husband or father was working, and on which her years since childhood have been spent. It may not, perhaps, be altogether inappro- priate here to call attention to the fact which xi Preface M. Meline would probably have invited to his aid, if he happened to remember it, that our familiar word "dairy" was originally derived from the old English word " deye," which merely signifies a maid, and which came with slight alteration to be used as a term of endearment, and thus gave us the growing young woman as the central and characteristic figure in the industrial arrangement for the production and the sale of milk and butter and cheese. Bacon says that " dairies being well housewifed are exceeding commodious," and, again, " children in dairy countries do wax more tall than where they feed more upon bread and flesh." M. Meline, indeed, gives us many illustrations of the happy contrast between the condition of women who have always been employed in farm and gardening work, and that of those who make a living for themselves, or help to make a living for their families, through their toil with the indoor work of great cities. This, of course, is only one part of our author's case, but he dwells upon it, and illuminates it with artistic, and even poetic, expressiveness. We all must admit that the crowding of rural populations, of all manner of populations, into most of our large cities and towns has an especially destructive effect upon the physical xii Preface health, and the mental and moral improvement of women. In our own islands there has been every- where, of late years, a clearly expressed anxiety for the accomplishment of the return to the land, and a general agreement that such a return is only to be brought about by a course of legislation, which shall make the toiler in fields the owner of the piece of land he culti- vates. Conservative governments, as well as Liberal governments, have shown themselves anxious to introduce legislation with such an object. The time has happily long gone by when John Stuart Mill justly described the Irish cottier-tenant as one of the few men \nho could neither benefit by his own industry, nor suffer by his own improvidence. The description was literally correct at the day when Mill gave it to the world. The only result which the Irish cottier-tenant could accomplish for himself by the improvement of his farm, was to bring about an increase of his rent, and his most utter im- providence could do no worse than bring him to the workhouse, the shelter whither his industry would be just as likely to conduct him in the end. No tendency in modern opinion and in modern legislation can be more distinct than the tendency towards a system which shall create xiii Preface a peasant-proprietary, and make the tiller of the soil the owner of that much of the soil which he cultivates. There is also, and has been growing up for some time, a tendency amongst civilized countries to recognize the artistic, picturesque, and poetic associations belonging to the culture of the land ; the associations on which M. Meline dwells with much effect as tending so happily to the development of human education. We have seen these associations very effectively illustrated in some recent move- ments at home. The Garden City is not by any means a mere dream ; it is already becoming in many places something like a reality. There are some splendid plans for the improvement of London itself on this principle, for the con- version of many of London's unpicturesque, squalid, and overcrowded regions into open spaces with grass and trees, and with houses and cottages not too near to stifle and darken each other, but only near enough to allow of friendly intercourse and companionship. There are also schemes for the creation of garden cities in various parts of the country, cities to be constituted mainly of homes belonging to the cultivators of the soil themselves, and not open to the indiscriminate incursion of a slum population. xiv Preface M. Meline in his work gives very naturally his main attention to the condition of the rural population in France, and, of course, that is exactly the subject on which we all especially desire to have the benefit of his observation and judgment ; but the English readers will find that much of his advice has a distinct applica- tion to the development of agricultural industry now going on in Great Britain and Ireland. M. Meline is strongly of opinion that in the creation of new agricultural communities, in the construction, for instance, of garden cities, some effort should always be made to provide for the resident's greater opportunities of amusement and of genial intercourse. He feels convinced that in many of the larger villages and smaller towns the habits of the residents are injuriously affected by the absence of any such oppor- tunities, and that men, and women as well, are drawn into the use of deleterious stimulants by mere lack of any means of occupying them- selves when the actual work of the day is over. He would, therefore, encourage all harmless and healthful amusements, indoor and out-of-door, throughout the agricultural settlements of the coming time. So far as out-of-door amusements are concerned, our rural populations have, I should think, a decided advantage over those xv b Preface of France ; but, on the other hand, I see good reason for believing that, so far as indoor amusements are concerned, our village com- munities are not nearly so well equipped as those of France. We learn from M. Meline's book that an eminent French manufacturer con- templates the creation of a garden city capable of holding 6000 workers at Champagne-sur- Seine, side by side with electricity works. M. Meline, however, does not put too much faith in the reforms to be created by the formation of garden cities. As M. Meline very fairly puts it, the garden city must always be something exceptional and isolated, and however numerous such cities may be, they can give shelter only to a small minority of the human race. It is not likely that all great manufacturers will take to the founding of such delightful refuges, or that all the garden cities actually founded are destined to prove success- ful. "The industrial struggle of to-day," to quote M. Meline's words, " is no idyll, and to win one's way lin it it is often necessary to make the best of very unpleasant and uninviting surroundings." The great question to be con- sidered is, as M. Meline puts it, how to lead back to the land those surplus workers who can find no employment in the cities. The relief of xvi Preface the cities has to be considered as well as the cultivation of the farms. The cities ought to be relieved from the crowd of unemployed workers, and the fields ought to be supplied with a number of workers who would fain find em- ployment there, but who know that it is hope- less under present conditions to seek any such means of making a living there. The reader will find in this work a very faithful study of the present condition of agricul- j ture, not only in France, which is naturally the main subject of many chapters, but also in many European countries, and in the United States, Canada, Mexico, and other lands. M. Meline argues that thus far the ministries and parlia- ments of too many countries have entirely neglected in legislation the rural districts in order to do everything that could be done for the towns. So far as France is concerned, M. Meline says that the explanation is quite simple. "The people in the towns constitute the most important voters, making their voices heard, and securing obedience to tfieir wishes; and their needs are admirably served by a Press still more energetic, which flatters them in order to maintain and extend its own power, as well as by innumerable politicians vieing against each other with promises which one of xvii Preface these days may have to be fulfilled." "The government," M. Meline declares, " is afraid of these powers, and does everything it can to give them satisfaction, paying little or no attention to these inarticulate peasants who are so resigned to their lot, and whose patience is so wonderful." The author here is treating only of his own country, and is not making any attack upon the government or the Press of England. I do not, from my own opportunities of observation, see any reason to believe that the ministries and the Press of Great Britain and Ireland have been wholly absorbed during recent years in studying the welfare of the citizen peoples, and have remained, or have been allowed to remain, entirely indifferent to the state of the agricultural regions and their populations. Few other subjects have occupied more attention on the part of the House of Commons during recent years than the many questions of land settlement which have come up for discussion; and, indeed, I should be rather inclined to say that, while the public in general may have given much attention to the troubles caused by the overcrowding of cities, the ministries and parliaments have not shown adequate energy in the efforts to supply some remedy for those evils. It may be said, xviii Preface however, that the efforts to solve either question, if carried out at once with courage and dis- cretion, must directly tend to the solving of the other. The study of M. Meline's work helps of itself to make this fact more and more clear. One inestimable benefit which must come from the return to the land would be the relief of the overcrowded cities ; and the relief of the overcrowded cities would find its best and readiest means of accomplishment by the opening up of new occupation for workers on the land. Thus there ought to be no serious likelihood of any antagonism between town and country concerning this great movement for the re-occupation of the land. He who helps the one cause helps the other cause that much at least is quite certain. M. Meline concludes his task by declaring that to ameliorate the lot of the working-classes, and ward off the dangers which are impending, there is but one thing to do, and that is "to provide them with new fields of labour by send- ing them back to the land." M. Meline sums up at the close of his final chapter the solution of the problem before us "which may be said to be merely an expansion of a profound thought uttered long ago by a Chinese philosopher a thought which should be inscribed upon the xix Preface walls of our schools in letters of gold ' The well- being of a people is like a tree ; agriculture is its root, manufacture and commerce are its branches and leaves ; if the root is injured the leaves fall, the branches break away, and the tree dies.' " I have thus set forth and sometimes, to the great advantage of my readers, in M. Meline's own words, at least in the English translation of them the main purposes of a work which cannot fail to come in for world-wide attention and even study. I have not made any attempt to describe the methods by which the author believes that the results which he hopes for can be accomplished, the manner in which State guidance and State aid can be given to such a movement, the specifics for the regulation of foreign competition among the nations of the earth, the means of remedying or relieving the troubles brought about by seasons of agricultural distress, and all the many other difficulties in the way of that return to the land which the author regards as the only possible panacea for some of humanity's troubles. M. Meline's book must be carefully read and studied if its purpose is to be thoroughly appreciated, and no mere summary of its pages given by an outsider could possibly render justice to it. The greater part of the book is, of course, occupied with the XX Preface land question as it is working itself out in France, and in which there are many operating conditions, conditions alike of climate, of usage, and of law, which naturally do not find their exact parallel in all or in any other countries; but, as I have already said, the author appears to have made a deep study of the agricultural question as it presents itself in many other countries as well as in his own, and the manner in which he proposes that his project should be worked out will be found worthy of study in every country where the claims of manufacturing and agricultural industry are coming into com- petition. I have made these comments mainly because it occurred to me that some English readers might be discouraged by discovering early in the book that its author was dealing for the most part with French conditions. Any reader who may feel thus discouraged at the outset will find, if he perseveres, that although the volume is mainly French in its descriptions and its horizon, yet the main purpose of the author may be appreciated, and his proposals turned to good account under whatever skies and amid whatever legalized conditions. M. Meline's views on economic questions are some- times at entire variance with my own, but I hope that I am not in any sense disqualified xxi Preface by that fact from rendering full justice to the general objects of the great movement which the author invites, and indeed regards as in- evitable. M. Meline is conservative enough in his views to satisfy the best regulated of British Conservative minds, and he tells us himself that " the spirit of the French peasant contains trea- sures of good sense and right thinking which will strengthen it against the sophisms of the revolutionary school, and save it from the perilous adventures into which socialism would tempt it." Furthermore, he assures us that "The return to the land will not be brought about by violent and empirical measures, but scientifically, and by men of good will working in concord and unity for the ordering of the products of the nation in harmony and proportion." Such is the vision of the future which M. Meline opens up to our eyes. It is indeed an idyllic and a fascinating picture. An English poet laments for the day, " Ere England's griefs began, when every rood of ground maintained its man." There is no precise definition of the historical period described as the time " ere England's griefs began," and one may well be inclined to believe that with the very beginning of every people some griefs must already have been foreshadowed. But without entering into any xxii Preface consideration of that question, it must seem to most of us an ideal time when every rood of ground shall be able to maintain its man, and the return to the land, which M. Meline sees in pro- spect, is to "enable the land to maintain its work- ing woman also in prosperity and self-respect. Such a period, indeed, when the cities shall no longer be overcrowded, and vast spaces of land now uncultivated although with a half-starving peasantry striving to maintain a living, there shall be divided among the ownership of hard- working, intelligent, and prosperous peasant proprietors, must seem to most of us like a return of the golden age. It must also be borne in mind that M. Meline, although with many poetic touches in his style, is not a poet or a mere idealist, but a practical and scientific thinker, an experienced statesman, who has studied his question thoroughly, and has satisfied himself that the condition of things he foresees can be established by improved legislation, and by the influence of healthful co-operation. It is true that the book now published has mainly to do with the land and the agricultural populations of France, but we all know that the depressing conditions which he shows us as existing in France, are even still the actual and the common experience of most or all of the other countries xxiii Preface of our modern world. We may, therefore, reasonably assume that if the happy solution of the hitherto unsolved problem can be accom- plished in France, it may also be accomplished with at least 'equal success in our own countries. The period is specially favourable for the begin- ning in sober, serious earnest of such a result by the adaptation of our existing laws to the pur- pose of bringing about the return to the land. The idea has of late been taking a firm hold on the minds of all thinking men and women. I have already pointed out that the state of the Irish peasantry is even now showing how much can be done for the cultivation of the soil and for the comfort of its workers by the legislative measures which even Conversative ministeries have helped to introduce, and which half a century ago our legislators would have regarded as utterly impracticable, and also as monstrously unjust to the ruling landlords, whose arbitrary and seignorial rights such measures sought to abolish. I may say for myself, that I feel all the greater satisfaction when I remember that the plans and the predictions of our author come from a man who in many of his economic prin- ciples does not accept the doctrines of most of the British public. If M. Meline can see his way xxiv Preface to such results, how easy ought to be their accomplishment in a country like England, which is for the most part in full harmony with the doctrines of men like Richard Cobden and John Bright. The truth is, that the great principles which M. Meline advocates, have a far wider scope than can be surveyed and comprehended within the mere limitations of this or that economic school. We must keep before our minds steadily, to begin with, that the two great objects we have in view are the relief of the cities from the superabundance of populations striving hopelessly to obtain a living where the population is already superabundant, and the restoration to the uncultivated land of that inde- pendent peasant proprietorship which alone can save it from lying waste. As I read this volume it is a pleading, first of all, for the peasant owner- ship of the piece of land which the peasant cultivates, and therefore a diffusion of that skilful and intelligent labour which can make the cultivation of the land a benefit and a blessing to the poor toiler as well as to the lord of the soil. The " Return to the Land " seems to me sure of a welcome among the intelligent and the progressive states and nations of the world. JUSTIN MCCARTHY. xxv CONTENTS PAGE PREFACE v INTRODUCTION i CHAPTER I THE GROWTH OF MANUFACTURE I. The Nineteenth Century The Sudden Growth of the Manufacturing Industries Three Periods . 7 II. The Commercial Supremacy of England . . 9 III. The Other Nations establish Industries Triumph of the Protectionist System The United States and Japan join in . . . . . .10 IV. Swollen Markets The Advance of Germany Development of Other Countries . . . .21 CHAPTER II THE INDUSTRIAL CONGESTION I. The Third Period in the History of Modern Manu- factures The Crisis of 1901 27 II. Exports an Index to Over-production Their Extra- ordinary Increase of Recent Years ... 30 III. German Methods and Devices Cartels ... 35 IV. Evidences and Effects of Over-production . . 39 CHAPTER III FRANCE. IMPROVEMENTS IN MACHINERY I. The Development of Manufacture in France Total Horse-power employed 47 xxvii Contents II. The Cotton and Wool Industry Difficulties of their Position Silk Metals 50 III. Protection charged with Over-production A Fallacy England and Belgium 57 IV. Permanent Causes of Over-production The Im- provement in Machinery New Trades Reduc- tion of Manual Labour 60 CHAPTER IV MERCHANTS AND WORKMEN I. Resistance offered by Workmen to Machinery Their Folly 67 II. The Socialistic Remedy for Over-production Shorter Hours of Labour The Solidarity of the World's Markets The Need of International Accord 69 III. Unemployment, a Sign of the Industrial Distress The Grave Aspect in England, Germany, and France Vagabondism 72 IV. The Commercial Plethora Too many Middle- men The Condition of the Petty Tradesman . 75 CHAPTER V THE RETURN TO THE LAND I. Obstacles and Objections The Agricultural Crisis 83 II. Tariff Reform and its Effects 84 III. The Causes of the Rural Exodus . . .87 IV. Agriculture and Manufacture compared Raw Material and Costs of Production Agricultural Loans 92 V. Taxation Fiscal Inequality Personal Estate Income Tax 96 VI. Unsatisfactory Methods of Sale Middlemen A Remedy Co-operation 106 VII. Co-operative Societies for Production and Sale Exports 1 10 VIII. Agricultural Training The Training of Worn en . 120 xxviii Contents CHAPTER VI STATE AID PAGE I. The Risks involved in Agriculture Methods of In- surance Cantonal Hospitals . . . .129 II. Benevolent Institutions Mutual Benefit Societies Savings Banks 134 III. The " Bien de Famille "How to establish it The Peasant Proprietor Home Industries. . .138 CHAPTER VII VILLAGE LIFE. THE PUBLIC HEALTH I. Need of Intellectual Enjoyments in the Country Changes to be brought about The Absentee Bourgeois 147 II. The Craving for Employment under Government De-centralization 150 III. Capitalists and the Land The Agricultural Revival Diminution of Industrial Profits . . . 153 IV. Hygiene and Public Health Tuberculosis . .155 V. Workmen's Gardens How to cope with Vagabond- age State Aid Increase in the Numbers of Peasant Proprietors The Birth-rate . . .161 CHAPTER VIII ARTISANS AND PEASANTS I. Socialistic Solutions M. Vandervelde's Ideas . 169 II. The Transplanting of Manufactories into the Country 172 III. Garden Cities Port Sunlight and Bournville . . 175 IV. The Transition from Manufacture to Agriculture Modifications of the Evil of Unemployment . 178 xxix Contents CHAPTER IX THE PRESENT CONDITION OF AGRICULTURE PAGE I. Machinery and the Saving of Labour Limits to the Possibilities in this Direction Limitless Possi- bilities for the Agricultural Market . . .185 II. The Call of the Land The Universal Tendency- Economic Causes Mr. Chamberlain's Proposals Their Weak Point The Agrarian Movement in Germany, its Power and Success New Treaties of Commerce Italy The United States . .189 CHAPTER X THE COLONIES. AGRARIAN SOCIALISM I. The Position of France from an Agricultural Point of View Her Resources Reclaimable Land Foreign Labour Statistics 207 II. Bourgeois and Tradesman The Dividing up of the Land Land in the Colonies Our Colonial Pos- sessions .211 III. The Need of Improved Education Aids to Coloni- zation 213 IV. Algeria Inadequate Population M. Jonnart's Plan 217 V. Agrarian Socialism Its Various Forms Remedies 220 VI. Conclusion 238 XXX THE RETURN TO THE LAND INTRODUCTION century just closed must rank always as one of the most marvellous periods in the history of the world. So far-reaching are the transformations it has brought about, we may say without hyperbole that it has moulded the world anew. To attempt to take stock of what has happened during even the latter half of it, is to stand amazed at all that has been sw r ept away and all that has been ushered in. Such metamorphoses have been wrought in the life alike of society and of the individual, that it seems almost like a dream when one goes back in mind to the days of one's youth. The further past is rich in great events, and every century has its distinguishing mark ; no two are alike, yet there is a family resemblance between all. They seem to grow out of each other in a natural process of evolution. I B The Return to the Land With the nineteenth century above all, with its close the scene changes suddenly, and we find ourselves in an unknown land. There would seem to have been a break in the evolutionary process. In less than fifty years everything is turned upside down manufacture, agriculture, commerce, methods of transport, everything. It is nothing less than a revolution we find in progress, carrying all things along with it like a torrent. To cause and consummate this revolution, all that was needed was the appearance upon the scene of a new force, until then little talked of science. In a moment science gave a new aspect to everything the whole world had to keep pace with her. Ever since, we have been going at a gallop a breathless gallop that prevents us from seeing where we are. Now there is danger in this headlong career the danger of our coming croppers over the obstacles we cannot foresee. The present would seem, therefore, to be a fitting moment to call a halt in order to look around and ahead, and to take note of the far-reaching transformation that is going on. The purpose of my book is to examine into 2 Introduction the actual facts of this transformation, to set forth impartially the good and the ill that it has entailed, to ascertain whither it is leading us, and to discover the means of turning it to the best interests of mankind. THE GROWTH OF MANUFACTURE CHAPTER I THE GROWTH OF MANUFACTURE I THE outstanding feature of the nineteenth century is the immense development of the manufacturing industries. Manufacture to- day is as different from what it was a hundred years ago, as are our social institutions from those of the Middle Ages. In less than half a century it has sprung up like a colossal tree, drawing to itself all the living forces of the world. It was inevitable that this change should take place, from the moment when science made its way upon the stage of primitive industry, ever turning, until then, in the same circle, ever running in the same grooves. There being available only enough manual labour to work the inadequate and inefficient machinery of those days, the limits of production were always fixed by the number of arms in existence and their strength or weakness. There were no captains 7 The Return to the Land of industry at this period only master workers living in the midst of their small body of apprentices, like fathers among their children. There was no such thing as competition in the present meaning of the word, and over-produc- tion was unknown. Every workshop depended upon its neighbouring clientele, and knew exactly the extent of its needs ; the difficulty of com- munication and the cost of transfer had the effect of securing every industrial concern its own markets, capable of keeping it going peacefully and without anxiety. The history of modern manufacture begins with the wonderful inventions which have sub- stituted machinery for the arms, and even the brains, of the workers ; and which, by means of rapid and inexpensive transport, have brought all the markets of the world into touch, making one great common market of them all. Let us see through what successive stages the manufacturing industries have passed on their way to the position in which we find them now. We can divide their history into three separate periods corresponding to three quite distinct stages. The Growth of Manufacture II The first period begins with the adaptation of science to industry, the employment of steam- engines and the introduction of mechanical labour resulting in the gradual elimination of workmen. It is obvious that the nation destined to profit at the start by this revolution must be the one best' supplied .by nature with iron, the material for the machines, and with coal, their daily bread. It was inevitable, therefore, that England, so richly endowed in both respects, should take the lead and become the foremost industrial country ; it was only natural, more- over, that, having no rival in a condition to compete with her, she should have secured all the markets and become a sort of universal provider to the world. During this first period, England wears the aspect of a giant capable of crushing all coali- tions, and she is so assured of being all- powerful that she equips herself as though she must retain this ascendency for ever. Her glory extends to the confines of the globe, and she lords it over all the markets of Europe, Asia, and the New World, distributing her enormous output in every direction ; she seems to have 9 The Return to the Land a real monopoly, and all the other nations seem resigned to her mastery. For a moment it seemed as though she were disposed to let France have a share, but] the illusions born of the famous treaties of 1860 were not long-lived; we soon discovered that we had been merely the cat's-paws for our more powerful neighbour, and that, instead of finding our way into her field, it was she who was finding her way more and more into ours. Our principal industries, taught by sharp experience, came to the conclusion at last that contest with an adversary so well-armed was impossible, and gave out a cry of alarm, which was only silenced by the downfall of the Empire. We come now to our second period, following upon the year 1870. Ill After 1870, a sudden change begins to operate in the economic condition of Europe, and finishes by extending over every part of the world. 1A11 the great nations evince their intention to shake off the industrial yoke of England, and to create, each on its own territory, manufactures capable of ministering to home needs. To defend themselves against foreign competition 10 The Growth of Manufacture and facilitate the establishment of these in- dustries, all these countries without exception fortified themselves behind a tariff of import,/ duties. " We have no need of the foreigner," was the mot d'ordre, " we are self-sufficing." To be self-sufficing that is the ideal which inspires and dominates the economic regime of most nations. That this should come about was inevitable, and England ought to have foreseen it. What could be more natural than that a nation should seek to provide for its own needs instead of calling upon the foreigner to supply them ? Charity, well-administered, begins at home is not that the A B C of economic science ? You may censure and deplore as much as you please what you may regard as a narrow point of view, a lack of high principle in commercial life, but it would be naif to show surprise at it. How could any one nation lay claim to a right to be a provider to all the others, and to prevent them from emancipating them- selves by establishing industries of their own? " It is sheer stupidity," say free traders, " to persist in buying dear at home what you can get so cheap from abroad." " Possibly," the nation interested may reply, " but I prefer to give my money to my working classes rather than to foreigners, first of all because it gives them their ii The Return to the Land living, secondly because it remains in the country and benefits my entire population instead of my neighbours." It is easy to understand how the new idea made its way everywhere, its opponents becom- ing fewer and fewer every day. After Germany, which opened the ball, Austria, Russia, France, Spain, Italy, and Switzerland joined in. The whole of Europe, save for England and, to a certain extent, Belgium, drew up tariffs and protection became universal. Thus it was that all the European markets became closed against England, and that she found herself obliged to seek new openings elsewhere for her immense production. She had recourse to America, Asia, and Africa, and for some years she met with all the success she could desire and imagined herself saved; but it was not long before she aroused in these regions also the same feeling of independence that had been evoked in Europe, combined with the same instinct of self-preservation. America was the first to enter into line with European nations, doing so impetuously and with a sublime disregard for all obstacles in the way, bringing into her economic reforms all the practical spirit and the tenacity of the Anglo- Saxon race, together with the bellicose ardour of 12 The Growth of Manufacture a young people confident of its destinies. Burn- ing its boats and leaving to elderly Europe the prudent formulas of a modified protection, she took up her stand on the ground of prohibition. All the economists laughed at her, and predicted that she would stifle behind her Great Wall of China, and would soon have to call out for mercy. She let them talk, continued to keep herself closed off, and thus succeeded in establishing upon her soil all those industries we now see capable of ministering to the needs of her ever- growing population.* The first consequence of this step on the part of the United States was the abolition of Europe's principal market for manufactured goods a clientele of eighty millions. It was hard to see how the European industries would recover from the blow. It was a significant warning for them in any case, and a little reflection should have sufficed to make them realize that the hour for great ambitions had passed, and that the most elementary prudence bade them slacken their! pace and beware of over-production. They might well have foreseen, from this moment, another danger not less inevitable the * The United States produced, in 1899, 13,000,000 tons of cast-iron that is to say, more than all the rest of the world produced in 1870 (12,000,000). 13 The Return to the Land danger that the Americans, with their headstrong temperament, would not stop half-way, but would go to extremes in their economical development by becoming exporters in their turn, and endeav- ouring, like England, to invade the whole world. They have succeeded in this with a dizzying rapidity which is marvellous; in a few short years they have taken their place among the great exporting countries, and the results obtained are almost beyond belief.* Let us leave on one side the exportation of agricultural products and raw materials, because we shall be told that this kind of export is a necessity and a benefit to the importing countries. Let us speak only of manufactured products. To estimate these, it may suffice to say that during the last decade they have augmented at the rate of 146 per cent, while the increase in the export of agricultural products amounted only to 36 per cent. The strange and disquieting thing about this * The total exports of the United States passed from $4,130,000,000 in 1890, to $7,288,000,000 in 1903, an increase of 76 per cent. There was a slight decrease in 1904, owing to the general crisis, and it came down to $7,128,000,000. American exports to England have increased at the rate of 127 per cent, during the last twenty-three years ; to India at the rate of 126 per cent. ; to British North America at the rate of 322 per cent. During the last few years American imports have, it should be added, been increasing noticeably. 14 The Growth of Manufacture colossal expansion is that America has not sought out new, unoccupied markets, as might have been supposed ; she has resolutely attacked the markets of Europe those which were already being best worked those of France and Germany and England herself. In 1903, the exports of the United States amounted to $1,013,000,000, whereas those of all the rest of the world came to only $1,458,000,000.* * To form a just idea of the vast aspirations of the United States, and of their belief in themselves, one should read in its entirety an article published a few years ago in Scribnet*s Magazine, from the pen of an American of high standing in finance, Mr. Vanderlip, assistant secretary to the Treasury. "Formerly," says Mr. Vanderlip, "America was the great exporter of cereals and raw material, and Europe the great workshop in which these products were turned to account. Now the roles are changed ; our exports of industrial products increase from day to day, to such a degree that the figures reached during the last three years justify the nervousness now evinced in Europe regarding our industrial invasion. The exportation of manufactured articles during the years 1889- 1897 amounted to $163,000,000 on an average, in 1898 it amounted to $290,000,000, in 1899 to $333,000,000, and in 1900 to $434,000,000. This ever-increasing exporta- tion has been accompanied by a corollary phenomenon : the rejection by our own markets of foreign industrial products. America is becoming more and more a self-sufficing country ; our industry is gaining more and more the mastery of the international market." To give to the above sentences their full significance, Mr. Vanderlip proceeds to base upon them the following prophecy : " The more industrial products we supply to other countries, 15 The Return to the Land Not content with making themselves inde- pendent of Europe and then depriving Europe of some portion of her own home markets, the United States are now laying siege to those markets further afield, which Europe used to dominate dethroning her in South America, in China, and even in Canada, where they are pursuing England into her last intrenchments. It might have been supposed that after the United States no other competitor would venture to enter the lists, and that the general economic situation was now settled for good and all. What, then, was the general consternation when, a few years ago, a small people who had not been given much thought, and who were con- sidered half-savage, suddenly emerged from their shell (after a slow period of incubation that had not been much observed by the sleepy eyes of European diplomacy), and speedily won for themselves a place in the front rank of indus- trial races, pending the moment when they w r ere to take a similar position amongst great military powers: I speak of Japan. It was so recently as 1897 that Japan, follow- ing the example of the United States, set about the less they will be able to manufacture themselves ; and certain enthusiasts already foresee the day when America will be the great provider for the entire world." 16 The Growth of Manufacture reforming its customs and became resolutely protectionist. In a moment almost it had estab- lished great industries on its own soil, borrowing from Europe her industrial science and her most perfected machinery. Once started, Japan never looked back, and the results of her action are prodigious : in 1895, sne could boast only 518,000 spindles for cotton ; in 1902 she possessed 1,400,000. Her production of oil, which did not exceed 3,000,000 tuns in 1893, amounted in 1901 to 8,000,000. From having been merely an importer, she became suddenly one of the most formidable of exporters : her general exports rose from 25,000,000 yen in 1898 to 289,000,000 in 1903. Her exports of cotton goods, which amounted to 63,000,000 francs in 1902, amounted in the following year to 101,000,000. As regards silk, her progress was still more remarkable. Her silk exports in 1903 reached the enormous figure of 289,000,000 francs. This movement of expansion will not stop there; the wonderful successes which estab- lished Japan as a great military power were merely a prelude to the economic conquests which await her, and on which she counts; for she had this in view when she undertook the war, and her struggle with Russia was but a proof of her intention to capture the Asiatic 17 c The Return to the Land market and to remain master of it. The great nations of Europe, which looked on benevolently at Japan's attack upon gigantic Russia, and which rejoiced in secret over Russia's humilia- tion, will learn one day to their cost that jealousy is an evil counsellor, and that they have been favouring the game of the most formidable of all their competitors. The same may be said of the United States, which at one time hugged the notion of being Japan's provider, and which soon will find themselves not only driven out of this market, but ousted also from the huge market in China, of which they also dreamed. One would have to be blind not to see that Japan is preparing to play the same economic role in the Extreme East that Germany played in Europe after 1870, with this difference, which ensures her expansion an advantage over Ger- many that she is as inaccessible and invulner- able as England by reason of her insular position. The war in Manchuria, as she regarded it, was merely her first application of a new Monroe Doctrine for the Yellow Race. She considers herself called upon to take her place as leader of this race, and take it she will : her victories over the white race have assured her an irresistible ascendency over it. 18 The Growth of Manufacture It seems probable that she will not abuse her power just at first, and that she will not push her military advantages too far for fear of com- promising them, and of provoking a general coalition against her. She will doubtless content herself with organising the warlike elements of China just as she organised her own, and with holding them in leash ready to let loose when- ever the hour for the great struggle with the white races sliall have sounded, and she shall feel herself strong enough to brave the entire world. Until then she will content herself with the role of commercial invader invading without scruple. On this field she is in a position to challenge the strongest with even greater sense of security, and there is none fit to try conclu- sions with her. Labour costs her nothing, her working-classes are intelligent, industrious, artistic, and very docile; her captains of in- dustry, taught in the leading schools and the greatest establishments in Europe, are qualified to lead the great masses just as her generals were qualified to lead their troops. As to her plant, it is as good as her armaments it is all on the latest model and above criticism. Japan, therefore, is in a better condition for producing than either Europe or America, and '9 The Return to the Land as the Chinese clientele is at her gate, stretching out its hands to her, and ready to give her pre- ference over all competitors, there can scarcely be any doubt as to her eventual victory, and it is probable that before long she will be in com- mand of a market of 400,000,000 consumers. So great a revolution will never have been witnessed since the beginning of the world, and it is very late now to attempt to arrest it. And Europe has not lacked warnings warnings have come, indeed, from every direction. In France, the Yellow Peril has been foretold long since by M. Edmond Thery, one of the first to foretell it at all ; and M. Thery foresaw only the economic peril which now goes hand in hand with the peril to national existence. He foretold the economic all-powerfulness of this over-ambitious race, whose growth was almost visible to the naked eye, and which threatened all others with commercial extinction. His predictions are in a fair way to fulfilment, unless Europe, awaking from her lethargy and forgetting all points of difference, succeeds in finding some way of combining for the protection of her vantage points in Asia and of presenting an insuperable barrier to the yellow invasion. The battle is not yet lost; but mistakes must not be committed, and time must not be lost. 20 The Growth of Manufacture IV Having now outlined the economic chart of the world, let us examine it a little more closely, and try to see into the future. It is manifest that the advent upon the scene of the United States and Japan, pending that of Canada, have turned completely upside down the industrial situation in this old Europe of ours, and what is pitiable is that Europe does not seem to realize it. She orders her production as though nothing had changed all round her, as though she were still mistress of her destinies. Yet the merest common sense should warn her to be on her guard. In face of this universal movement towards industrialism which has not yet said its last word * this world-wide * Every year sees some new nation take a step towards its industrial emancipation. Mexico is now advancing with great strides, and gaining ground every day. In the cotton industry it possesses already 1,450,000 spindles, and 25,000 looms (? ) ; in 1902 it counted already more than 6,000 industrial establish- ments, giving occupation to 177,000 persons. Soon Canada, in her turn, will enter upon the scene, and we may look for an expansion in her case analogous to that of the United States ; a land which produces already 250,000 tons of cast-iron cannot stay its progress. Even the seemingly most backward European nations are beginning now to fall in with the universal tendency. Thus Hungary, essentially an agricultural country, is manifesting its 21 The Return to the Land competition which she has now to meet she ought to see that her ambitions should be con- trolled. She closes her eyes to this, however, and does not even concentrate her energies upon those particular articles of trade in which she has some speciality, and the market for which she might hope to retain. It is only right to say that Germany is primarily responsible for this onward progress. Exalted by her proud position in the world, carried along by her scientists and engineers and financiers, and by her Government as well, it was she who gave the first impulse to the movement. The other nations have but followed in her wake. Her early successes were dazzling, and the progress she made in a few years was marvellous. It is true that the wealth of her natural resources, for so long lying fallow, justified her ambitions. Her coal mines, which contain reserves as great as, if not greater than, those of England, and her iron mines, which produce excellent material for her foundries, enabled her to establish intention of withdrawing its custom as a purchaser from Austria, and of setting up industries of its own. With the help of bonuses granted by the Hungarian Government, 96 new manufactories were started in the country in the first three months of 1904. Four of these were of paper, ten of chemical products ; eight were ironworks. 22 The Growth of Manufacture metal industries that competed favourably for all the markets of the world. She has added chemical works which have won her a veritable monopoly in this direction, so far in advance are they of any others elsewhere ; her annual trade in chemical goods alone amounts to the enor- mous figure of 1,400,000,000 marks. Its total exportation increased between 1903 and 1904 by over 30 per cent* But if Germany is at the head of European nations as regards the enormous total of her exports, she is not now going ahead the fastest. During the period 1890-1904, the exports of Italy increased at the rate of 63 per cent, those of Russia 57 per cent, Belgium 43 per cent, Switzerland 26 per cent, France 19 per cent, England 15 per cent, Austria 13 per cent What is the meaning of this unless it be that the productive countries of Europe have been led, one after another, into the universal movement, and that each of them, having first made sure of a home market, has made efforts * In the metal industry, Germany is establishing her' supremacy more and more in place of that of England. Between the years 1892 and 1902, Germany's metal exportation for Europe, England included, increased by 72 per cent., while that of England for Europe, Germany included, decreased by 43 per cent. 23 The Return to the Land I in its turn to poach upon the clientele of the others and to get a footing on foreign markets ? It is possible to see clearly now the course that was taken by the great economic contest of less than fifteen years ago between the strongest nations. Two new giants stand face to face, the United States and Germany, and while fighting against each other, they fight together against England. They dump down deluges of cheap goods in their efforts to snatch markets. The other nations, instead of avoiding danger by restricting their production, keep producing ever more and more, in the mad hope of crushing their competitors. Each moves forward blindly; the one question they never ask themselves is, whether there be consumers enough to justify their prodigality of produc- tion. This is thought of only when the indus- trial crisis has begun to rage everywhere, and to endanger even the most flourishing industries. We arrive, then, at our third period, into which we came a few years ago, and which may, perhaps, be designated as the period of over- production and swollen markets. THE INDUSTRIAL CONGESTION CHAPTER II THE INDUSTRIAL CONGESTION I "\ T 7E do no't close our eyes to the fact that the * * very existence of this evil of over- production is denied. We are asked to produce scientific proofs of what we assert. It must be admitted that scientific proofs are not easily forthcoming. To adduce them we should need to know the exact proportions borne to each other by the world's supply and demand. As yet we can only put our hand upon statistics serving to give us some idea of the amount of the supply. The first tables of statistics to which we may give our attention are those setting forth the total output for the world of certain industries which may be regarded as a barometer to all the others an almost exact indicator to the development of those industries which depend upon them. The first is that of the collieries ; coal constituting the motive power which keeps 27 The Return to the Land industry alive, it is easy to deduce from the extent of the output the degree of industrial development that is attained. Upon this point, as upon so many others, / we may get our information from the Office ^International cCAnvers, which was established for the purpose of drawing up statistics of the production of industry and of the progress of trade all over the world ; we shall have occasion to borrow more than once from its interesting pages. The following are the figures it gives for coal : 1870 203,000,000 tons. 1890 469,000,000 1900 694,000,000 1902 749,000,000 What I have said of coal may also be said of iron, also the raw material of countless industries. The firm of James Watson and Co., of Glas- gow, has recently published statistics of the pro- duction of iron in all parts of the world in 1903. From these it appears that the amount went up from 39,000,000 tons in 1901, to 43,000,000 in 1902, and nearly 46,000,000 in 1903; an increase of 15 per cent, in three years. Germany's output alone increased within this period 25 per cent. These years mark the beginning of the 28 The Industrial Congestion tendency towards over-production. The excep- tional number of great public works just then under construction combined with the develop- ment of electric railways to provoke such an immense demand that the workshops could not meet it. The grave error was then made of imagining that a condition of things which was only temporary and accidental would become permanent, and of proceeding to produce as though the general consumption had become doubled. A still more extraordinary thing came about : the industrial revival did not stop short at metallurgy, which alone came in for the excep- tional demands. The other industries, infected by example, carried away by the high price of coal, took it into their heads that the con- sumption of their products also would go up tremendously, and that we were on the verge of an unparalleled season of permanent good trade. The textile industries especially began to expand everywhere, new factories springing up as though by magic out of the earth. The illusion was made all the greater because our Exhibition of 1900, which was so brilliant and did so much to reveal the marvellous progress of technical industry, gave a fillip to consump- tion; it was merely a fillip, unfortunately, as 29 The Return to the Land was only too evident presently. A moment's reflection ought to have sufficed to make us reflect that consumption, especially nowadays, does not make these leaps forward, and that if it progresses it progresses slowly; and that if it becomes surfeited, there is a tendency to relapse. The result of the imprudence was that the great industrial countries, finding on their hands a large surplus of merchandise, for which they had no use, were forced to export it at any price they could secure in order to avoid such a "slump" internally, accompanied by stoppage of work, as might give rise to an alarming social crisis. II This is the only explanation that can be given of the quite abnormal exports which have marked the last few years, and which constitute an economic event deserving of the most serious attention, for it affects all countries equally. There is no surer indication of the importance of the production of a country and of its economic development, especially in the case of great industries such as those of metals and textiles, than these sudden increases in the 30 The Industrial Congestion amount of their exports. For in these cases what do the exports consist of if not of the surplus stock for which no market can be found at home, and which must therefore be disposed of abroad ? I do not mean that exports are always and everywhere synonymous with over-production. There are normal exports consisting of merchan- dise provided specially for the foreigner. Until recently these were the only kind of exports at all. That was as long as we were still working foreign markets which bid against each other for certain classes of goods to such an extent that the demand often exceeded the supply. Things have been changing, however, and now the great industries regard exports as merely a method of disposing of their surplus stocks ; when the home market is active and buying largely they diminish or suspend their exports, as we have seen of late years in the United States, where the metal industry, finding its enormous output entirely taken up for the construction of railways, etc., ceased exporting altogether for a time until the home demand had been satisfied. The distinguishing mark of these exports, generally speaking, is the fact that they are effected in great bulk and at very low prices The Return to the Land "liquidation exports" they have been desig- nated not incorrectly. It is notorious that of recent years exports of this kind have been the chief figure in the commercial statistics of the great producing countries.* If only one market, or only a few markets, were glutted at a time, the economic equilibrium would soon be re-established by the flow of the surplus output upon the markets in good condi- tion ; but it has sometimes happened that all the great markets have been glutted simultaneously. No need to describe the prodigious effort, and the enormous sacrifices made by each country to get the better of the others. Trusts, cartels, industrial unions, have been found indispen- sable, if superficial, methods of saving the situation. Having, then, established the truth of the fact, that the advance in exports is a sure index to the home production of a country, let us see * The very nature of these exports proves the truth of what is said above. It is to be noted that they consist chiefly of merchandise universally in demand and such as most countries can produce for themselves, and that they go to markets which could quite well dispense with them. There can, for instance, be no doubt that when Germany sends her cast-iron to Belgium, Great Britain, and the United States, it is not because these countries are unable to produce enough for their own use, it is because the German market is glutted and must be eased at any price. 32 The Industrial Congestion now what our commercial statistics have to tell us upon this point. Thanks to the Antwerp Statistical Bureau, we have the advantage of being put in possession of them all for the whole world, and are able, therefore, to form a precise notion of the course of production during the last few years. Here are the figures for the entire world for the years 1897, 1902, and 1903. Francs. Total Exports in 1897 ... 46,000,000,000 1902 ... 56,000,000,000 1903 ... 6o,OOOjOOO,OOO If we bear in mind the fact that the year 1902 was one of the most calamitous for industries of every description, the significance of this advance of 4000 millions in a single year will come home to us ; * it enables us to form some notion of the increase of the world's production, but only a faint and quite inadequate notion. All it tells us of is the surplus stock which could not be utilized. It gives us no idea of the increase in the home production consumed internally. This must have exceeded very * For Europe alone the total exports, amounting in 1875 to only 22,000,000,000 francs, had reached 34,000,000,000 in 1902 an increase of 12,000,000,000 in twenty-seven years ; but in 1903 there was a further advance to 36,800,000,000. In the light of these figures, the industrial crisis does not seem surprising. 33 D The Return to the Land considerably the' records of previous years, judging from the statistics of certain individual industries. I ought not to seem to minimize, however, the total increase of 14,000 millions for the seven years an increase representing the growth of what I may call the floating world's merchandise, inasmuch as it floats about in search of an outlet. No one would venture to contend seriously that in this short space of time the normal con- sumption of the world had developed in propor- tion. The increase in the world's population, which is sometimes invoked by way of ex- plaining matters, does not warrant any such theory ; its rate of advance is infinitely more slow and regular.* Nor can it be maintained that the advance in general prosperity an important factor in regard to consumption suffices to explain so rapid a rise in production. Prosperity also progresses regularly, not by leaps and bounds; to satisfy ourselves of this, we have but to examine the statistics of the wealth of the different nations. * According to the statistics, which seem to be most carefully compiled and most trustworthy in every way those made out by our great French statistician, M. Levasseur the popu- lation of the world in 1878, was 1,439,600,000; in 1890, 1,483,000,000 ; in 1904, 1,523,000,000. 34 The Industrial Congestion Nowhere except in the United States* can we find record of any such extraordinary advance in the condition of the well-to-do; as for the worker, he is doubtless better housed and better fed than formerly, and able to afford pleasures unknown to his class fifty years ago, but in 1900 he was in very much the same state that he is in now. Therefore no other explanation can be given of the extraordinary increase of exports than the fact that most of the markets are glutted as a result of over-production. Ill The Germans recognize this fact, and we must do them the justice of admitting that, after being one of the chief causes of the industrial crisis, they are now seeking to repair their fault. As soon as they realized that their excess of production threatened them with an imminent crash, they made efforts to save their market by empirical methods : they organized their cartels with the utmost possible astuteness. Thanks to their tariff, which enabled them to * The wealth of the United States, estimated at 42,000,000,000 dollars in 1880, rose, in 1900 to 94,000,000,000 ; this works out at 1235 dollars a head instead of 850. 35 The Return to the Land raise their prices for their home market, they were able to levy " drawbacks" which for a certain time gave them an incontestable advantage over all their rivals. The mechanism of " dumping " is too well known to need any enlargement upon it here, and a discussion of this subject would take us too far. I confine myself, therefore, to adducing the phenomenon of these cartels* as a striking proof of the excess of production in Germany. But the German manufacturers, who are essentially practical men, realized presently that this kind of wholesale pouring out of exports was only a temporary expedient, and not a remedy. It relieved the glutted market for the time being, but if the over-production were to be kept up, if stocks were to be replenished as quickly as they were thus disposed of, the evil would become endemic, and there would be no issue to the crisis. Thus they were brought to the conclusion that, sooner or later, when the home market * It is thanks to these cartels, as I have said, that the ex- ports of iron from Germany for Europe alone have increased to 72 per cent., while those from England have decreased by 43 per cent. The German exports to other countries, not including the United States, have increased from 1,544,000 tons in 1897 to 2,000,000 tons in 1902. 36 The Industrial Congestion became congested a limit must be put upon pro- duction. All other measures are mere palliatives. In order to effect this, they again had recourse to cartels for the regulation of production, reducing it to a certain fixed degree, and distri- buting it among the various syndicated establish- ments. This division is carried out with perfect equity according to the productive capacity of the factories and to the state of the market ; each manufacturer knows in advance the limit assigned to him, and he has no temptation to go beyond it. German industry has just taken a still more daring step in this directiona step which no one couldihave foreseen. Not content with thus checking manufacturers at home, it has quite recently put forward proposals for an under- standing with its most redoubtable rivals abroad. This is no news. Every one is aware to-day that the German steel cartel (Stahlwerkband) has invited the English, Belgian, and French manu- facturers of steel rails, girders, etc., to come to an understanding by which each nation con- tracting would limit its participation in the exporting of these articles to a certain fixed figure, the factories of each country preserv- ing, of course, their individuality and inde- pendence. The understanding has now been 37 The Return to the Land definitely come to, and it is believed that it will presently take in the United States. This new species of combination is certainly one of the most important economical events of the last few years. There is no need to inquire as to the results which it has had upon the industries affected, and which cannot but be favourable. If we have devoted so much attention to it, that is because it supplies us with the strongest argument in support of our thesis. This entente, to which the most powerful industrial nations in the world found themselves obliged to come, is surely the most striking proof of the general state of over-production. It is a recognition that there is no longer room for every one on the export markets, and that the wisest course is to come to terms and to reduce the supply of merchandise to the demand. From all this we are forced to the conclusion that the upward tendency of industrial produc- tion will soon cease, and that production will be kept afterwards within the limits imposed by consumption. It is because we foresee this inevitable evolution that we wish to help it by preparing the passage from one state of things to another, 38 The Industrial Congestion and by seeking means to cope with the untoward effects it may bring about in other fields of labour. IV But, as we have said, our thesis is challenged by many people, and we must pass under review the objections they advance. First of all, there are the persistent optimists who are not to be alarmed by anything, and attribute all crises to the nature of the laws of economy, or who rather deny the existence of any crisis at all, and hold that over-production is merely the bogey of ill-ordered minds. The proof that it is a phantom, they tell us, is to be found in the fact that everything that is pro- duced is sold, and that there are purchasers always for everything; there has never been a case of merchandise being thrown into the sea for lack of buyers. Doubtless, the producers will always prefer to sell cheap rather than not at all, but it is also certain that consumers are not always to be tempted by mere cheapness. It is upon this disastrous delusion that rest the wholesale ex- ports, which have been becoming so general. If industry is to be carried on upon such lines, so 39 The Return to the Land be it; but don't let it be denied that over-pro- duction exists, for these low prices are proof positive of the fact. When production is normal and in accordance with the needs of consumption, the consumer runs after the producer, who is master of the situation, and sees to it that the price paid shall yield him his due profits. When, on the contrary, it exceeds the needs of consumption, it is the producer who has to run after the consumer, offering his goods at a reduction, in order to have the advantage of his competitors; under- selling becomes a regular thing, trade goes to the bad. This is all inevitable an economic law which no one can hope to escape. And this law has been manifesting itself now for twenty years with painful persistency ; it has been set out in relief by a great English statis- tician, Mr. Sauerbeck, who for thirty years and more has been devoting his powerful intellect to a study of the oscillation of the different markets, noting their movements day by day, and embodying the result of his observations in formulae of great interest and the utmost precision. In order to put his conclusions intelligibly before the general public, scarcely an courant with such abstruse problems, he has selected 40 The Industrial Congestion in his classification of merchandise those which do the biggest trade by reason of their uni- versal utility. He takes forty-five of these, and begins by establishing their average price for the period 1869 to 1877 the period preceding the great industrial movement of the end of the nineteenth century. He makes this average price the basis of his further calculations, by representing it by the figure 100, above and below which he watches the rise and fall of the value of these goods month by month and year by year. If you want to take note of the general trend of prices since 1877, you need only take the extreme figures, the first figure of all, the average between 1869 and 1877, and the figure for 1904. There is a fall there from 100 to 70 a decrease of 30 per cent. It is only right to point out that, in the interval, prices have varied considerably, going down in 1896 and 1897 to 61 and 62, rising in 1900 to 75 and going down again to 69 in 1902 and 1903. But these oscillations themselves do but confirm the general law that we are en- deavouring to establish; on the one hand, the constant downward tendency for the last twenty- five years, on the other hand, the coincidence of low prices with over-production. But, it will be said, you are overlooking two The Return to the Land essential factors, which explain the inevitable lowering of prices, quite apart from any question of over-production: the growing cheapness of raw material and the progress of machinery. We admit the existence of both these factors. No one could deny what is so manifest. But they are not enough to account for the abnor- mally low prices. The extent to which they affect the cost price of industries is easily calcu- lated. Every manufacturer knows exactly how much difference is made for him by a reduction in the cost of raw material the difference is not so great as we are asked to believe, except perhaps in the case of cotton ; he knows also what saving is involved in the improvements of machinery, and when he complains of prices becoming low, he is, of course, allowing fully for these economies. On the other hand, it is to be remembered that if raw material has become cheaper, manual labour in most industries has become a good deal dearer. If you ask a mill-owner or a weaver, for instance, to tell you the cost price of his goods and the price at which he has sold them in 1897 and this year, he will have no difficulty in con- vincing you that his sale price has decreased to an infinitely greater degree than his cost price. The calculation has been recently worked out 42 The Industrial Congestion very carefully by the syndicate of the Textiles Union for " Warp 28 " the classical number for cotton; in order to place its statement outside the realms of discussion, the Union has separated the working expenses from the price of the raw material, and records that the margin left to the manufacturer on his sale price for the working expenses went down from i franc 56 centimes in 1865 to 60 centimes in 1903. What has caused the present crisis for a great many industries is not small profits, but sale below cost value, forcing them year after year to make encroachments upon capital. The crisis must last until a balance has been struck between supply and demand, and this is only to be brought about by a systematic restriction of production in accordance with the needs of the different markets. Willy-nilly, we must come to this restriction sooner or later, in some shape or form, and the country that attempts it first will be well repaid. 43 FRANCE. IMPROVEMENTS IN MACHINERY CHAPTER III FRANCE. IMPROVEMENTS IN MACHINERY I TJAVING made the circuit of the world, let *- -*- us turn our attention now to France, to appreciate whose present economical status this general survey was necessary. Her relations with all the other countries make her part and parcel of the universal movement. In common with the other nations, France has seen old-established and valuable markets closed to her, according as her customers in different regions have developed, and have established industries in rivalry with hers. Yet other rnarkets have been snatched from her by stronger rivals for instance, those in South America, which, in part, she has seen pass into the hands of Germany and of the United States. Thus her economical situation might have become very serious, and have resulted in the wrecking of her chief industries, if her colonies 47 The Return to the Land had not come into existence in time to supply fresh markets. The colonial policy of France was her salvation, and the country can never be too grateful to Jules Ferry for his foresight in thus saving her from commercial ruin. It must be said, however, for the commercial classes in France, that they are by nature more prudent than those of other countries, though some of our industries have of recent years fallen into the mistake of over-production. Let us take note of certain significant data which are at hand. It is now some years since M. Edmond Thery, that eminent economist, drew attention to the danger of over-production in a preface he contributed to M. Francis Laur's informing work upon monopolies. He pointed out very justly that, in order to form an estimate of the extent of our industries, it was quite unnecessary to make out an elaborate table of statistics, and that there was a much simpler and easier way of arriving at the facts : namely, that of ascertaining the total horse-power employed in our manufactories. This figure indicates as nearly as possible the importance and extent of our entire industrial machinery, and in consequence of our production. Recognizing the truth of this, let us leave on one side the figures adduced by M. Thery, 48 France, Improvements in Machinery which are now some years out of date, and let us apply his method to the data furnished by the latest statistics issued by our Ministry of Commerce. The horse-power in use in French industries in 1890 amounted to 863,000; ten years later, in 1900, the figure is more than doubled, 1,791,000. Since 1890, there has been a still higher rate of increase, the figure having reached 1,994,989 in 1902. Among the industries that have developed most speedily is that of metals, which employed in 1890 only 167,584 horse- power, while in 1902 it employs 354,856. The increase shown by the textile industries is greater still, the figure having been 172,999 in 1890 and 434,529 in 1902. To give life to these cold facts, we should have recourse to M. Thery's method, and calcu- late, as he does, the amount of manual labour of which all tfiis machinery takes the place ; a simple calculation, given the principle accepted by experts, that one-horse power is the equiva- lent of the labour of twenty-one men. Thus it is that M. Thery comes finally to the conclusion that, as regards production we are in the same position as though our working-class population had tripled, and as though every French citizen had at his service three iron slaves, the upkeep 49 E The Return to the Land of which does not cost more than five centimes a day. Let us now look a little more closely into the condition of some of our great industries, taking from the Statistical Annual of the Ministry of Commerce particulars of other kinds, so as to give its full value to the argument already drawn from the horse-power figures. II Let us take the cotton industry, for instance ; it is an easy matter to follow its development. The raw material comes entirely from abroad, and our custom-house statistics tell in exactly what quantities. The total amount in 1890 was 2,500,000 cwt, excluding what was re- exported; in 1900, the figure increased to 3,142,000 cwt. Then comes an almost incredible rise to 4,376,000 cwt. in 1903. If in 1904 the figure came down to 2,500,000, that is due entirely to the fact that the price of cotton had doubled. Who would venture to declare that this increase was normal and in response to the demand? No doubt, the uses oi cotton are being extended unceasingly it is used in 50 France* Improvements in Machinery everything nowadays, and is often turned to accounts for which it is not suited but this has been true for some considerable time past, and is not the outcome merely of the last few years. When we see the number of spindles in- creasing in five years between 1898 and 1903 from 5,300,000 to 6,150,000; and that of looms, in the eastern district alone, from 46,000 to 54,000, it is difficult to believe that the normal consumption has increased in the same degree. The truth is, that many of those who manu- factured at so feverish a rate in 1900 were not thinking of the consumption at all. All they thought of was the high prices then in vogue prices wfrfch they quite wrongly took as heralds of a permanent revival, and of the beginning of a new era of prosperity. If they had only looked round them attentively, they would have been warned by several other symptoms that their output was more than sufficient. In a kindred industry, that of wool, there had come about a state of things from which cotton was bound to suffer. We all know through what difficulties the woollen industry has had to pass, and how genius alone has been able to save it. Together with the silk industry, it constituted one of our - - The Return to the Land principal exports, and therefore it was affected more than others by the great movement which we have already analysed and which impelled the majority of nations to establish at home all those branches of manufactory for which they were dependent upon the foreigner. Wool could not escape from their general law any more than silk could. In succession, Germany, the United States, Austria, Russia, and Spain were to be found developing their production of wool and depriving the French industry of a great part of its market. France had just won a footing for its woollen goods in Japan, when that country also began to prepare to do without us.* In so critical a situation, what should we have done in order to come to the assistance of one of our great national industries? Our first duty was to seek all possible means of enabling her to fight for the foreign markets, and, to this end, of diminishing her cost of production. We did just the opposite we were at pains to increase in every way the burdens weighing * Japan has just constructed three great manufactories for muslin our most important item. One of these is at Osaka, the other two are at Tokio. If we remember that the working- day in Japan is of fifteen or even seventeen hours, at an average wage of 25 centimes a day, we can form some idea of the industrial struggle we must soon encounter. 52 France, Improvements in Machinery upon the industry. Our import duties are the highest known, and we keep on raising them continually.* New restrictions, new trammels, involving loss of time and of money, are being invented daily by our Ministry of Commerce. Finally, we reduced the working-day by two hours, thus^giving an enormous advantage to our rivals without asking for anything in return. While all other countries are doing whatever lies in their power to encourage and support their national industries, we seem to take a malign pleasure in fettering ours. Our idea of benefiting the working-man seems to consist of providing that he shall work as little as possible, t In the woollen industry, numerous manu- factories have been closed : nineteen at Rheims ; thirty-nine at Fourmies ; three at Tourcoing ; others at St. Quentin. These closings have had a quite unforeseen * The Socie*t de 1'Industrie Lainiere de Fourmies satisfied a Parliamentary commission that in France taxes upon wool are three times higher than they are in Belgium. In the same way, the Union des Industries Textiles has established the fact that the trade has to pay 12 francs in taxation in France, while in England it pays only 9.06. t The Italian Government, wishing to develop the industry in the south of Italy, has granted new establishments immunity from all taxation for ten years, and has permitted them to import all other necessary plant free of duty. 53 The Return to the Land issue, which leads us back to what we were saying about the cotton industry. Certain woollen manufactories, wishing to fight to the last against evil fortune, have been transformed into cotton manufactories rather than be abandoned altogether. In this way the pro- duction of cotton has been started at Fourmies and considerably increased at St. Quentin. It was necessary to draw attention to these facts because they show that there was no need to construct new looms. The condition of the cotton industry in France was to become the more grave in that it has been developing extraordinarily elsewhere of recent years, and that our rivals, not satisfied with providing for their own needs, have passed from the defensive to the offensive, and have made inroads on all the markets which formerly we supplied.* * Germany has increased her export of cotton by 30 per cent., Belgium by 20 per cent. In the United States, 270 new cotton factories have been established since 1900, and the number of spindles has gone from 15,000,000 to 21,000,000. Italy has made giant's strides within a few years. Her exports of cotton goods, which amounted in 1887 to only 620,000 kilos, increased to 12,350,000 in 1900 an increase of 1892 per cent.! She is on the way to undermining British influence in Asia Minor, as is evidenced by the growth of her imports at Aleppo. As for the United States, they have increased, their textile industries enormously between 1890 and 1900. Thus cotton 54 France* Improvements in Machinery N And what we have said of woollen and cotton goods can be said equally of our silk, which formerly was mistress of the whole world, but which now is having inroads made on it every- where, in Germany, Italy, Switzerland, the United States, and which has begun to find a new and still more formidable competitor in Japan.* If we pass now to the metal industry, we shall find that it also has passed through the same illusions and the same ordeals. It also was misled by the rise in prices and the large demands caused by the great public works and by the Paris Exhibition. It also went beyond the limit, as is evidenced by the increase in the number of blast furnaces, and now it is obliged to mark time like the rest. What saved it and enabled it to extricate itself from the crisis more spindles have gone from 14,000,000 to 15,000,000 ; looms from 324,000 to 490,000 ; looms for wool from 67,000 to 80,000 ; those for hosiery from 36,00010 75,000 ; spindles for silk from 718,000 to 1,426,000, and those for looms for silk from 20,000 to 48,000. * The amount of raw material taken by the different countries enables us to realize the progress made by our competitors ; the increase in the consumption of silk, which has been 31 per cent, for the other European nations, 83 per cent, for the United States, has only been 10 per cent, for France. Since 1898, the production in the United States has been greater than with us. Their production in 1898 was 237,000 kilos ; now it is 1,850,000. 55 The Return to the Land speedily than certain other industries, was the fact that it had the courage to reduce its output the moment it discovered that it had been going ahead too fast. I have enlarged upon these points because of the great importance of the industries concerned, employing as they do a very considerable number of workmen 500,000 in metallurgy, 800,000 in textiles and because it is these industries that have developed most, and that for several years past have been most affected by the general condition of surfeit. There are, however, very few industries that have not been tempted into over-production of late. Every one is anxious nowadays to make his fortune, and business is generally regarded as the shortest way towards the goal. New- comers neglect to ascertain whether there be room for them. They do not realize how things have changed. They have heard how people have succeeded in the past beyond all hope, and they have no doubt that they will have the same good fortune. The temptation is all the more strong in that there are no limitations to industrial production; herein it differs pro- foundly from agriculture, which is perforce kept within the bounds of the cultivable land. In business the field of activity is limitless. You 56 France. Improvements in Machinery can build factories and instal looms and spindles to any degree you will. What is even more dangerous than the temptation to build is that temptation to expand which comes to every one in business, and which seems to point in the direction of his best interests. For the more he produces, the more he reduces his general expenses, the more he lowers his net costs, the greater his advantages over his competitors : herein lurks a perpetual temptation to the manufacturer against which even the most prudent even those most op- posed in theory to over-production are not proof. Industrial pressure, this new pheno- menon that to-day is assuming proportions that begin to be disquieting, is to be attributed to no other cause than this. Every one hopes to crush his rivals by the mass of his production, and to remain a solitary victor on the stricken field. Ill Upon this theme we have now to face the views of the foes of our economical doctrine, pointing in triumph at all this over-production and exclaiming : " There is the fatal, inevitable outcome of protection. Over-production is its 57 -'"" ~' >F TH ' 'CT5,rM-*-.r \S The Return to the Land natural fruit, and protectionists have no right to complain about it : they are but reaping what they have sown. The exceptional advantages created by protection for the favoured industries prove too effective a fillip, and urge them into over-production. Every one makes for the field in which most money is to be earned, and only realizes his mistake when he has gone too far. Free trade would preserve us from such dangers; no one would venture to produce before assuring himself of purchasers. The falling off of the price would suffice to warn the producer and to keep him back. It would be a check on the most ardent." The reasoning is specious, but it is not borne out by the facts of experience. We would not deny that the protectionist system does stimulate production by encouraging industry, and that its influence in this direction is apt to be exces- sive. But it is to be hoped that our manu- facturers will realize presently that the fierce rivalry against each other they are now waging, robs them of the benefits of protective legisla- tion, and that a wise compact would be more to their interest than all this relentless strife. But it would be a grave mistake to suppose that under free trade the state of things would be improved. It is obvious that a manufacturer 53 France. Improvements in Machinery who is obliged to seek his purchasers all over the world, and who cannot even count upon those in his own special market, must live in a state of perpetual uncertainty, and cannot possibly know the real extent of the demand as well as he who lives under a protectionist regime, and who knows at least what purchasers he will find at home ; the former has to produce more or less " on spec" and in the dark, whereas the latter sees clearly how he stands. Another influence which works more strongly under free trade than under protection is the necessity of producing in large quantities, so as to diminish working expenses and keep down the net cost. It is because she has been slipping down the fatal incline for fifty years past that England has increased her output beyond all measure, and now finds herself in possession of manufactories and plant quite out of proportion to her steadily decreasing clientele throughout the world. This is so true, and she is being carried along at such a speed, that at this very moment on the morrow of the crisis which threatened so gravely her cotton industry a year ago she is going ahead again full tilt on her career of over- production with a blindness that is amazing. The English newspapers tell us that new mills 59 The Return to the Land are being erected in Lancashire representing something like 2000 looms and 2,000,000 spindles ! And that at a time when it is being noted in every corner of the globe that the production of cotton is far surpassing the demand. IV The truth is that over-production is at present an endemic evil, which rages alike under pro- tection and under free trade; apart from the influences at which we have glanced, it has quite another and very powerful generator, namely, the increasing progress in the perfecting of machinery. Whether this take the form of quite new inventions or the improvement and develop- ment of old, the result is the same : the diminu- tion of hand-labour and the reduction of the number of hands. No one can interfere with this, and we encounter here one of those primordial economic laws against which it is vain to rebel, however regrettable their results. It furnishes us with a decisive answer to another objection, very grave at first sight, which is advanced by those who refuse absolutely to admit that there is such a phenomenon as over-production. "Your fears are vain," they say ; " over-production is merely an accidental 60 France, Improvements in Machinery thing that corrects itself, and this will prove the case now as always. After a certain period of slackness, during which there will be a natural abatement in production, the market will return to its healthier condition ; the demand will become stronger again, new purchasers will make their appearance, and equilibrium will be re-established. All is well that ends well." I am far from seeing things in this opti- mistic light, but, granting that it be so, for the sake of argument, the theory leaves out of account this factor of which I have spoken the unceasing and unlimited perfecting of machinery. This process of perfecting proceeds at an unheard-of pace. The United States make some new invention every day which has the effect of reducing the number of workmen required such as the new cotton loom which requires but one workman to every eight or even twelve looms. It is true that this particular loom does not yet yield good results, except with common coarse stuffs, but who shall say that some means will not be discovered of adapting it to finer material ? In this case it will involve the suppression of half the manual labour now required. The Americans have invented all kinds of wonderful machines performing tasks 61 The Return to the Land so delicate and difficult that the supplest human hands cannot compete with them.* There is no reason, therefore, why in time workmen should not be almost entirely replaced by the slave of iron alluded to by M. Thery. The results of this gradual elimination of manual labour have begun to make themselves * M. Jules Huret, in his very suggestive and interesting book on the United States, "De New York a New Orleans," gives us a humorous account of one of these marvellous American machines which he saw in a metal foundry. " A tall turret with gigantic arms set in motion by one man, glided about over the immense room, taking up out of the furnaces as it passed great plates of steel, 50 centimetres thick, raising them aloft, turning them round, replacing them in other furnaces, or putting them on the cylinders of the rolling-mills (?), making a thousand gestures so swift and unexpected that I simply could not follow them, and pirouetting round with all the graces of a ballet-dancer ! Literally, it waltzed ! We rushed about after it and its inmate, but of a sudden it would threaten us with its agile and mighty arm, and we slipped to one side. This is a true description. It all seemed like a nightmare, and I kept asking myself whether I was not dreaming. I think it was of this Hoffmannesque engine that the American manager sai to me " ' Not good enough, this. I've asked the Board for half a million dollars to construct a new one, which shall be twice as practical.' " * And what will you do with this one sell it ? ' " He smiled. "'Not likely. We shall "scrap" it. We are often asked to sell our machines to Europe, but we always refuse. It would be bad policy to provide our rivals with our own special arms.' " 62 France* Improvements in Machinery felt already in our great industries, and it is possible to figure them out exactly. Let us take, for instance, the English cotton industry. In 1891, it counted 45,000,000 spindles ; now it counts 47,000,000, an increase of 3*6 per cent. Has the number of workmen increased in proportion? Not at all far from increasing, it has been diminished by 3*8 per cent, going down from 605,000 in 1891, to 582,000 in 1901. In France, we should certainly be able to record the same result, if our official statistics were as well made out as the English. Our Annuaire de Commerce furnishes us, how- ever, with sufficient data regarding the metal industries. It establishes the fact that in 1901, 72,000 workmen were employed in the produc- tion of 1,000,743 tons, while in 1902 only 68,000 were employed in the production of 1,000,885 a diminution of 4,000. The conclusion to be drawn from these facts, which are but a feeble indication of what the future has in store for us, is manifest, and has been formulated with admirable precision by the great American statistician, Edward Atkinson, whose words I may here cite textually : " The time is not far distant," he declares, "when even in the textile industry the same conditions will prevail that we find in the metal foundries 63 The Return to the Land to-day : you will scarcely see a single hand in the workshop. Workmen will become fewer and fewer, the work being all done automatically, until at last the manufactories shall have become nothing but mechanical contrivances, conducted by a few experts keeping an eye on the machines, and with only a very few specially chosen skilful hands employed in the weaving rooms." Thus, even in the collective industries indi- viduality, personal capacity, and aptitude, will come to prevail more and more, and though the manufactories may increase in number, and their output become ever greater, the proportion of ordinary hands will steadily decrease. MERCHANTS AND WORKMEN CHAPTER IV MERCHANTS AND WORKMEN I p /""\UR French workmen, who have an instinc- ^^ tive dread of this danger, endeavour to ward it off by refusing to adapt themselves to the progress of machinery ; we find them going out on strike when their employer calls on them to manage four spindles at a time as in England. Many of them draw the line at two spindles. The unfortunate fellows imagine they are doing a good thing when they oblige their employer to find occupation for as many of them as possible, not perceiving that they are thus preventing him from improving their lot and from increasing their wages. Yet the figures are there to open their eyes, and to enable them to see how things really stand : the American cotton-weaver, who attends to eight spindles, earns sixty-two francs a week; the Englishman, who attends to four, earns thirty; while the Frenchman, with two, 67 F 2 The Return to the Land earns only twenty-four. Yet the French work- man, who earns less than the American or the Englishman, costs his employer much more and augments his working expenses to a very con- siderable extent; his labour represents 12 francs to each spindle, while the Englishman's is only 7*50 and the American's 7*80. What is the result ? Simply that the French merchant is handicapped in the competition, and thus loses a proportion of his trade, to the great detriment of the workmen. It must be admitted that the truth of this is now gradually beginning to come home to the workmen themselves, and that in consequence some of them are seeing the wisdom of agreeing to work the four spindles. There is, of course, no doubt that the inevit- able result of the advances made in industrial machinery will be a reduction in the number of workmen employed, and that we find ourselves thus face to face with an economic and social problem for which some satisfactory solution must at all costs be found. How is work to be found for all the hands that will be thrown idle upon the market ? It will be for economists and statesmen to inquire into this serious state of affairs, and to devise some means for facilitating the transition to a new order of things. Merchants and Workmen II The Socialists believe that they have found the true solution ; after a long and vain resistance against machinery as the enemy of the worker, they have ended by bowing down before it as something inevitable, and to-day we find them declaring that it is to be blessed for doing away with so much ungrateful and unnecessary human labour. There is no cause, it seems, to be afraid of its results. To make sure of every workman finding employment, all that is needed is to reduce the Jength of the working day, shortening it, according to the time-saving pro- perties of the machine, from ten hours to eight or six or even five. After a long period of - sorrow and suffering mankind will arrive in this way eventually at the millennium. In the abstract, this reasoning is all right, and it sounds so well that one would like to believe it irrefutable. In practice, however, it conflicts with the facts. The mistake the Socialists fall into lies in their belief that the reduction of the hours of labour is a matter that each country is able to settle for itself; whereas it would only be practicable if the country making the experiment had no commercial and The Return to the Land industrial relations with the rest of the world, had no exports, and could live upon its own produce. This state of things exists only in dreamland. The commercial interests of the nations, far from being isolated, are getting to be more and more intermingled and interdependent; their solidarity is becoming every day more manifest. There is not a single nation at present which is not obliged, in order to keep going and to provide work for its labourers, to export a part of its produce, and in order that it may hold its own in the general competition, its net costs must be kept down. Now, as labour represents in most industries the most important item, it is essential that there should not be too great a discrepancy as regards its cost in different countries. The question has become an inter- national one of the highest importance, and can only be settled by the various nations in council. Only thus can all the interests involved be reconciled, and our French Socialists, who at their public meetings cry out so vehemently for an eight-hours' day, should address their appeals to workmen abroad, until they have converted the foreigner to their views; they could only achieve their ends in France at the expense of our own unfortunate workmen. 70 Merchants and Workmen The reduction of the hours of labour, more- over, cannot go beyond a certain point, and will not suffice in itself to make up for the diminu- tion in the need for manual labour caused by the progress of machinery. This is, moreover, another objection to any undue regulation of the hours of labour. It is apt to be forgotten that, side by side with the three million operatives in our great manufactories, there are six millions working in small establishments, or in their own homes, on whom an eight-hours' day, still less a five-hours' day, could not be imposed, for the conditions of their labour have not been affected by the advent of machinery; in agriculture, there are another three millions who will always be obliged to rise before dawn and work until after sunset. Among these three millions there will assuredly be many who will find it hard to reconcile themselves to a continuance of their unremitting labour, if they hear that the operatives in the city are only asked to work a few hours a day. These will quit the plough, and offer their services, cheap, at the doors of the manufactories. Instead, therefore, of the out-of-work problem being solved, the number of our out-of-works will be greater than ever.* * The American workers instead of fighting against the 71 The Return to the Land III Now the actual condition of things in respect to unemployment is serious enough, without our allowing it to get worse. When we turn our eyes in this direction, we are startled and shocked by what we see, for there is no more infallible evidence as to the real condition of the market than the statistics as to the number of hands out of work. When trade is pros- perous, the number is reduced to a minimum. When trade is bad it increases. It would seem as though the majority of the great markets have been slack for some years past. In the Board of Trade Report for 1903, we get precise information as to the state of things in England. "The labour market," it tells us, " shows a falling-off compared with the preceding three years. The average percentage of trades-unionists out of work has been 5-1 in 1903. It was 4'4 in 1902, 3*8 in 1901, 2*4 in 1899. The number of people in London in receipt of machines, do all they can to bring them to perfection, knowing that the more perfect the machine, the more important is the man who attends to it, and the bigger his wage. Their industrial ideal is that of a small body of skilled artisans, highly paid and continually bettering their position by raising themselves steadily on the ladder of professional knowledge. Merchants and Workmen poor-law relief increased from 103,000 in 1900 to 1 14,000 in 1903. In Germany the situation is not much more brilliant, despite the apparent prosperity of her trade. M. Vaillant, in his recent speech in the Chamber of Deputies, cites an elaborate census taken by the Berlin Workmen's Syndicate, according to which the total number of men entirely out of work in the Prussian capital was 76,000. Including those partially out oi work the number was 117,000. Let us come now to France, and consult the tables of statistics supplied by the Labour Bureau, and complemented by M. Faguet's report to the Labour Council. These documents tell us that the average number of out-of-works was 7 per cent, in 1896, 775 per cent, in 1901, and 9 per cent, in 1902. But it must be noted that this is not the whole truth. These numbers are supplied by the better-organized syndicates which suffer least from the evil of unemployment. More importance is to be attached to another document, infinitely more precise, and at the same time more wide-embracing. In the census returns of 1896 and 1901, workers out of em- ployment were called upon to mention their trade. From these returns it appears that in 73 The Return to the Land 1896 the number of unemployed was 4*6 per cent, and that in 1901 it had risen to 6-5 per cent. a very serious increase. But these figures do not give any adequate idea of the importance of the army of unem- ployed, for alongside the worker who is con- stantly in this condition, and who comes officially under the category, must be ranged all those innumerable nondescripts, tramps and loafers, who live by odd jobs when they do any work at all. These men adrift, objects of so much danger to society, are reckoned at 400,000 in France. They are a scourge to our country districts, and complaints about them come unceasingly to the Government as well to the local authorities. The numbers of our unemployed would be much greater were it not for the immense de- velopment of the new motor industry, still so conspicuously French. The progress in this has been one of the most curious economic pheno- mena of recent years. The total production for 1903, in France, is estimated at 171 million francs, of which about 50 millions were exported. If to this we add the output of bicycles and motor- cycles, which represent about 240 millions, we get a grand total of 400 millions. The number of workmen engaged directly or indirectly in 74 Merchants and Workmen that great industry is reckoned at 150,000, and their wages at 300,000,000 francs. Imagine what would be the state of things if this great army of workers was unemployed ! It is only right to bracket with the motor industry all those electricity works whose advance is also one of the most considerable factors in our economic situation. But flourish- ing though these industries be now, it would be a great mistake to believe that they are going to maintain for long their upward tendency. The clientele for automobiles has been supplied for some years to come, and it is evident that the " boom " still in progress will shortly come to an end. IV If we pass now from industry to commerce, we have to note a still more swollen condition of things. The exodus from the country which was caused by the agricultural crisis, and which we shall analyse in detail presently, has affected commerce even more than it has industry. Multitudes of small farmers, and even of small land-owners, have flooded into the cities, and having capitalized their small possessions have invested the result in a small confectionery 75 The Return to the Land business, or haberdashery establishment, or fruit- shop, or more frequently still in a wine-shop. The great increase in the numbers of cabarets a thing to be so much regretted is due in large degree to this.* To form a clear idea of the really alarming increase in the numbers of these small trades- men, the figures should be compared with those that show the corresponding diminution of the agricultural population during the same period. The Political Economy Annual for 1899 helps us to do this. It tells us that while in 1872 the agricultural classes represented 5270 in every section of 10,000 of the entire population, in 1884 the proportion was only 5003, and in 1891 only 4733. While as regards commerce, the move- ment was all the other way : the proportion in * This side of the question of the rural exodus has been clearly dealt with by M. Tisserand, Director of Agriculture, in his masterly introduction to the decennial statistical record of 1882. In this he raises a cry of warning against the growth in the numbers of middlemen as one of the dangers of the future. " They have multiplied," he tells us, "from 1,537,000 in 1861, to 4,644,000 in 1 88 1 ; this, in spite of the loss of Alsace-Lorraine ; an increase of more than six to the square kilometre ! In other words, our agriculturists and industrials have to keep and even to enrich 3,106,000 more middlemen now than then ! This is a real evil, explaining at once the diminution in the profits of agriculture and industry, and the increase in prices to the consumer." 76 Merchants and Workmen 1872 having been 843 per 10,000; in 1881, 1063; and in 1891, 1076.* We are not yet in possession of the complete results of the census of 1901. However, we are enabled to form an idea of them from the lumin- ous preliminary report of M. Levasseur, Director of the College de France, which has appeared recently. He informs us that from 1896 to 1901, the numbers of the urban population have been increased by 895,000, this figure resulting not from the excess of births over deaths which comes to only 35,000 but being accounted for principally by the enormous exodus from the rural districts, which is recorded as exceeding the figures of the preceding census by 670,000. Possibly this figure may need to be corrected, for if we turn to another section of the report, it would appear that the rural exodus towards certain large towns has ceased entirely in some very important regions, such as those of the north and east. This is a very notable improve- ment, and a reassuring sign for the future. The evil is already checked, and we are beginning to ascend again the incline down which we have been gliding. Unfortunately, the commercial plethora still * It should be borne in mind, however, that both tendencies became noticeable long before 1872. 77 The Return to the Land rages to its full extent, and its results are de- plorable for every one, for consumers as well as for agriculturists. This multiplicity of petty traders in all our towns, big and little, obliged to make their liveli- hood by the sale of the products passing through their hands, has had the effect of raising in an extraordinary degree all the absolute necessaries of life. We thus arrive at this absurd state of things, that the more the producer strives to lower his cost of production and his sale price, the more the consumer has to pay. It is the intermediary the petty tradesman who gets the greater part of the profit. What is most annoying about it is that the tradesman himself, far from making his fortune, merely stands still feebly, when he does not come to smash. This fact may sound incredible, yet it is easily explained; the large profits realized formerly by the middlemen, when they were limited in numbers, having led to the exodus from the rural districts, the result has been that a fierce and ruinous competition has come about, between the great numbers that are now dabbling in trade to-day. We could instance districts in Paris in which twenty years ago there were only two fruiterers, and in which now there are six or eight the 78 Merchants and Workmen same could be said of grocers, bakers, butchers, haberdashers, florists ; while as to wine-sellers, their name is legion. All these small shops, groaning under heavy expenses and forced to make their profits out of a meagre clientele, are only just managing to exist in spite of the high prices they ask. And, of course, they are in continual warfare with the big stores which are coming into existence everywhere, winning customers to them by their low prices. The tendency is irresistible, however much we may regret it. The only way of fighting against it would be for the small tradesmen to have recourse to co- operation themselves, so as to get their goods at the same low prices as the stores. Unfortunately they are too much divided among themselves for that, and co-operation is so little in our blood that we prefer to perish rather than come to terms with our competitors. Meanwhile, certain it is that our petty tradesmen suffer cruelly, and that some of them fall out of the ranks every day. The statistics as to failures tell us that. 79 THE RETURN TO THE LAND CHAPTER V THE RETURN TO THE LAND I WHAT, then, is to become of our countless workers unable to find work ? There is but one opening, one resource for them an opening wide enough for all, a resource that will be inexhaustible for centuries yet to come : the land. For a moment the land has been thrown into the shade by the manufacturing industries which have fascinated all eyes, absorbed all minds, given rise to all kinds of hopes. The humble industry of agriculture fell into disdain. It only began once more to raise its head when science at last turned her eyes upon it, and became aware that it was indeed the first of all industries, not only because it was the most necessary, but because it was the most elevated scientifically, being in its essence the centre of all those sciences that find in the soil their principal field of action. 83 G 2 The Return to the Land But if agriculture has been reinstated in its place from the standpoint of science, this has yet to be done for it in the domain of economics ; it is suffering still from its former attitude of humility, and there is much to be done before it can attain the popularity of its younger sister, industry. We shall be well employed, there- fore, in doing all that we can to enlist public interest in its present condition and future possi- bilities. The necessity for finding new openings for labour increases every day. The more difficult the labour question becomes in the world of manufacture, the more the movement back to the land will gather force. It has begun already, and things will advance more speedily than is supposed. II We are met, of course, with the eternal objection which, since the beginning of the agricultural crisis, has always been thrown at those who have sought to stem the current and prevent the exodus from the fields. "You are attempting the impossible," they cry; "the movement you are trying to foster, however desirable in itself, must meet with insuperable 84 The Return to the Land difficulties. The return to the land is a mere idyll, quite out of place in a matter-of-fact world like ours. How are you to divert a current which has been running with such strength for more than half a century, and which has carried along everything in its course ? Our agricultural population has been decreasing steadily in accordance with the Fates. " If the country has been abandoned, this has not been without reasons, and the reasons still exist. The agricultural labourer has deserted the soil because it imposed on him too much / work and too many privations ; he has preferred the factory because it gave him higher wages with less tiring work and more regular hours. Why should he return to the land which cannot offer him an equivalent for what he now has ? " The farmer and the landowner see things in the same light. If they also find their way to the towns, it is because they have found life in the country too wearing and too unprofitable." We should not dream of denying this melancholy but manifest truth. It is incon- testable that the complaints of the agricultural world are only too well founded. It is easy to understand why the rural classes have been induced to move en masse into the towns. The crisis, which raged more disastrously 85 The Return to the Land with us than anywhere else, because it was pre- ceded by an era of unexampled prosperity, was bound to put our agriculturists into a state of panic and to upset all existing conditions. What industry is there which, seeing its revenues decreased by one-half, while its ex- penses remained stationary, could long resist such a depression? None could have borne so hard an ordeal, and but for the tenacity and courage of our agriculturists and their inde- structible love for the land, there would have been an end altogether to agricultural industry in France. The rural exodus brought it within an inch of destruction; fortunately those who remained in the breach gave proof of an indomitable energy which saved the situation. And now, ts it possible to stem the current ? Is there any new element in the situation at present that will allow us to hope for a reaction ? Undoubtedly there is. The present condition of things economically is just the opposite to what it was thirty years ago. The manufacturing industry was then in the ascendant, agriculture was going down. Now agriculture is rising visibly, while the manufacturing industry has come to a standstill. The force of circumstances will, moreover, 86 The Return to the Land bring back to agriculture those who can no longer earn a livelihood in the factories. Labourers who have been long out of work and who have families to support will give up the unequal struggle in the towns. For the few who will drag on to the end, how many will giva in and reconcile themselves to the inevitable ? Ill But since then a great event has come about in the history of economics, doing away with the chief cause of the crisis and completely changing the face of the agricultural world. The Government has at last hearkened to the legitimate complaints of agriculture, crushed under the weight of foreign competition, and has put it on an equality with commerce by means of a protective tariff. The tariff of 1892 was an act of reparation and justice for it. The state of our agriculture in all its branches has been improved so much by this tariff, and our production of cereals as well as of cattle has been so much stimulated, that France has been able, not merely to supply her own needs, but to export a surplus as well.* * Since 1884, the year preceding the first establishment of protective duties, our agricultural trade has never ceased to 87 The Return to the Land So far so good, but it would not do to insist too much upon the point, and it is not to be maintained that a protectionist tariff is all that is required, and that agriculture has no other enemy besides foreign competition. On the contrary, agriculture has to cope with the same difficulties as other industries, and its life is a constant struggle. It is a great thing, however, to have removed from its path an obstacle against which all its efforts came to grief, and to have thus made it mistress of its own destinies. Let us now inquire into the numerous dis- advantages it has to fight against, premising that improve steadily. This has been very clearly set forth in a work published by M. Henry Sagnier, of the Journal de ? Agriculture. In his table of statistics, M. Sagnier leaves aside such entirely foreign products as rice, coffee, tea, cocoa, and pepper, as well as our trade with Algiers and our sugar trade, which last he considers to have been too directly influenced by the special legislation of the last few years. These items eliminated, he shows that our imports of agricultural products amounted in 1884 to 1,094,000,000 francs, and our exports to 652,000,000. Thus there was an excess of imports of 441,000,000 that is to say, France had to pay out this sum to the foreigner for her food. From the beginning of 1900, the exports began to exceed the imports. The excess of imports that year was 100,000,000, in 1901 it was 152,000.000, in 1902 it reached 202,000,000. In 1903 it sank to 62,000,000, but in 1904 it rose again to 124,000,000. In the twenty years, therefore, from 1884 to 1904, there has been an advance of 565,000,000 in this figure representing the progress made by our agriculture. 88 The Return to the Land the general situation has undoubtedly improved a good deal of recent years, and is improving more and more every day. It is to be noted, first of all, that if the agricultural crisis proved disastrous to the old- established proprietors, who saw their land depreciated to half its previous value, it affected very much less the new proprietors, who pur- chased their land at low prices. When land is cheap, its cultivator may hope for larger profits for his labour. Land is consequently becoming more in request, and recent statistics show in some departements a certain increase in rents and in the price of estates a sure sign of revival. Despite this slight improvement, however, there is no doubt that the position of an owner who is forced to let his land is still far from enviable, and that investments in real estate are by no means profitable. Very different is the position of the actual cultivator of the soil, whether he be landowner or farmer. It may be taken as beyond doubt that the agriculturist who has received a serious professional training, and who is at once progressive and methodical, is certain to draw in a good revenue upon his capital, whilst living in better style than many well-to-do citizens. There is still one great difficulty in the way 89 The Return to the Land of good and profitable cultivation of the soil, it is true, and that is the lack of cheap manual labour ; the small farmer has to do without it, relying on his own exertions and those of his family. There is a good deal of truth in the saying, that the fortune of a small farmer is in proportion to the number of his children. The more children he has the better. This need is of good augury for :the future of France, hitherto so gravely menaced by her low birth-rate. The agricultural crisis, of course, has been by no means the only cause of the exodus from the country. There is another which has been more decisive in its effects, namely, the change that has come over the minds of our rural population, especially of the young. They have quitted the land not because of its failure to provide them with the means of subsistence, but because of the dreariness of existence in the country and the apparent fascinations and charms of the towns. They have been drawn to the towns like moths to the flame ; in their small cottages they have sat dreaming of the splendid theatres, the brightly-lit cafes, the brilliant fetes, all the comforts and luxuries of city life, and then, when they have come back to reality and looked round their humble dwellings, at the grey naked 90 The Return to the Land walls, at the smoking candle and their soiled working clothes, they have been seized with a great longing and have had room in their minds for but one idea to get away at all cost, blind- fold, not knowing whither. Call it what you will, this moral phenomenon is not to be ignored. This state of mind it is that is luring away our country-folk, and that accounts for the growth of our monstrous cities, stretching out their arms in all directions and absorbing the life of the regions all around. The fascination has doubled in its intensity since enforced military service has made all the youth of the country pass through the garrisons of the towns. It is there they acquire their new tastes, habits which they can never again renounce, and in which they can indulge in the towns so in the towns they remain. If by chance they do return to the plough, it is not for long ; they soon weary of the monotonous life of the fields, they find everything beneath them, men and things, and they seize the first oppor- tunity of getting away again. Their great ambition is to become functionaries, postmen, shop-walkers, or railway employes. And it is not only the men who are thus affected; the women have not escaped the contagion of their example. They also have The Return to the Land been fascinated by the sight of the towns to which they have formed the habit of going in search of pleasure and distractions. They have derived from them a taste for gaiety and fine dresses and holiday-making. On their return, their village seems to them dull, the farm dirty and dismal, and their work repugnant ; the labourers seem to them dull and loutish com- pared with the seductive youths who have lavished money on them in the towns. The role of farmer's wife seems to them despicable, and they will have nothing to do with any of the young men of the village except those who have become clerks or functionaries This picture suggests something of the change that has come over the life of most of our villages during the last twenty years. We could instance several cases of great agricultural families which have given up splendid properties with aching hearts, because their sons could not find women to marry them and share their life in the country. IV Let us consider now, what methods are to be adopted to further the movement back to the land, and to attract those who still hesitate, but who would be only too happy to turn their 92 The Return to the Land steps in this direction if they could be shown that it would mean happiness and prosperity and well-being. First of all, let us see what it is that brings success to the manufacturing industry, under what conditions a factory may be counted upon earning good profits. Statesmen, economists, business men alike are all agreed that for an industry to attain its maximum of prosperity it must produce inex- pensively and in large quantities. Its working and incidental expenses must be kept as low as possible. An important item of the working expenses is the raw material. When this is purchased upon advantageous terms and when the works are well equipped in every way, the business may be expected to achieve good results. It is just .the same with agriculture. In this case the seeds are the raw material; the fertilizers represent the potent machinery. In both respects agriculture during the last ten years has been at least on a level with, if it has not had the advantages of, manufacture. Through the systematic and energetic efforts of the agricultural syndicate, both seeds and fertilizers of the best quality are now to be obtained at half the former prices. The change 93 The Return to the Land thus brought about is perhaps the most remark- able of any during the last half century in the world of agriculture; it has increased tenfold the possibilities of agricultural development. Farming on a small scale, always a prey to hesitation and timorousness, has not yet entered fully into the current, and there is still much progress to be made here. It has begun to move, however. The "model farms" which have been becoming so numerous have served to open men's eyes, and to show them what can be done. The small farmer is no longer able to plead his poverty as an excuse for not making use of the new methods, because he has only to put out his hand to get possession of the small amount of money required for the necessary purchases. It will be advanced to him by the admirable network of 1500 mutual loan banks, local or provincial, which are now to be found in every part of France. From these he can get capital not merely for fertilizers but also for invest- ments in live stock, which is a greater considera- tion still. These advances are made at 3 or 4 per cent, interest at most. Our organization in respect to agricultural loans is one of the most perfect and most complete in the world. Since the authorities 94 The Return to the Land placed at the disposal of these regional banks, without charging them interest, 40,000,000 francs from the Banque de France, agriculture has been unable to complain that it has been kept back by want of capital. It has had no reason to be jealous of manufacture, and has been able to raise money at even lower rates. It is a matter for regret that it has not availed itself to the full of its opportunities, for some proportion of the capital available for its use is still idle. That seems a surprising phe- nomenon, but it will surprise no one familiar with the distrustful and over-prudent mind of the French peasant. He dislikes borrowing, and will borrow only when he feels quite certain he can repay. He is not like those chevaliers d'industrie who abound in cities and who seek loans from every one, regardless of risks of failure. Our agri- culturists are of a very different stamp, and in consequence our agricultural banking system is the most firmly established in the world. This is the reason why there was not an immediate rush upon the well-filled coffers of the regional banks. Our agriculturists have still to grasp fully the importance of the institu- tion of credit as an instrument of economic progress, required by rich as well as poor. 95 The Return to the Land Their education in this direction is making pro- gress, and small farmers who at first fought shy of the banks, now may be seen making their way to them quite openly and no longer shame- faced over the transaction. But if agriculture is better placed than manufacture in this respect, it is less fortunate in regard to general expenses. Here a most important item is taxation. It makes all the difference as between the cost of an article in one country and in another. This is a matter of the utmost importance to agriculture, and cannot be insisted upon too much ; it is the key really to the agricultural problem of to-day. The return to the land will not be fully accomplished until the powers that be shall have decided to enter courage- ously upon the path ot reform in the matter of agricultural taxation. Our code of procedure requires to be almost completely reformed, and our civil code also will have to be subjected to drastic alterations if it is to be made really efficacious. The axe must strike deep into this giant tree which has been growing for a century and stifling everything that lies within its shade. 96 The Return to the Land The heavy charges that are such a weight upon landed property have often been con- demned. Agriculture is taxed more heavily than any other industry it is the beast of burden of the Treasury, as some one has called it. It is not easy to calculate exactly how much it has to bear, so multifarious are the various rates and taxes by which it is affected. This task has, however, been undertaken from different sides with great precision. In par- ticular, the calculation which was made some time ago by M. de Lucay has of late been pro- ceeded with by M. Fouquet in a communication made by him to the National Society of Agri- culture, published in the Journal d? Agriculture for August 20 and 27, 1904. M. Fouquet begins by showing the amount of direct taxation levied upon the agriculturist ; the land tax, the door and window taxes, the various charges and duties upon personal property, the stamp duties upon deeds, the tax upon mainmorte goods, etc. ; the total for the whole of France amounts to 411,000,000 francs. The 411 millions are borne by a revenue which M. Fouquet estimates as 2,397,000,000; but this revenue is already enormously weighted with charges that reduce its figure very con- siderably. The French mortgage debt, which 97 H The Return to the Land in 1894 amounted to 14,000,000,000 francs, places on the land an annual charge of at least 476,000,000 francs, which reduces this revenue to 1,921,000,000. The 411 millions of direct taxation upon this figure represents no less a proportion than 21 per cent. But the direct taxation is not all. There must be added all the innumerable transmission duties, fees in connection with sales and lettings, succession duties all of which amount to 700 millions more. M. Fouquet distributes this amount equally over agricultural property, town property, and personal estate a method of cal- culation manifestly to the disadvantage of the land, as the droits de mutation which it bears are infinitely higher than those on personal estate. This only strengthens the case, however, when we find that the land's share amounts to 296 millions, which brings the total taxation up to 36 per cent. ; this huge proportion being known to be below the real mark. M. Klotz, who had the drawing up of the agricultural budget of 1905, makes the case out worse than M. Fouquet. He begins by estab- lishing the fact that the Frenchman is more heavily taxed than any one else in the world : he pays 83 francs per head, 15 francs more, that is, than the most heavily taxed foreigner. The 98 The Return to the Land French agriculturist pays on an average 138 francs. He then proceeds to analyse the charges of all kinds that fall upon the land. To begin with, he demonstrates that, partly to the State, partly to the departement and commune, it pays 21*80 francs per cent, of its revenue ; he proceeds, how- ever, like M. Fouquet, to deal with the mortgage debts, which he reckons at 15,000,000,000 francs, involving 600,000,000 as interest, 400,000,000 of which falls upon land not built upon, equivalent to another 20 per cent, on the agricultural revenue. M. Klotz, having added another i per cent, for the expense of records required by the public officials, comes to the conclusion that, taken all together, the charges which the land must meet before producing a penny of profit represents 41 per cent, on the revenue. In the second part of his study, M. Klotz, in order to bring out still more completely the real situation of agriculture, adds to these particulars of the charges on the land a record of the charges upon the personal estate. He finds that, ac- cording to statistics published by the Registra- tion Department for 1903, personal estate paid 265,000,000 for transmission duties, stamp duties, revenue taxes, taxes upon stock exchange 99 The Return to the Land operation, succession duties which upon a revenue of 3,436,000,000 comes to 7*59 francs in the loo. Therefore the land is taxed relatively more than five times as much as personal estate. It is not surprising, therefore, if capital be de- flected from agriculture into personal estate securities, and that landed property in France has decreased 20 per cent, in value, while per- sonal estate has increased 50 per cent. Of all the burdens upon agriculture, the most unjustifiable economically, and the most crushing, though not actually the heaviest, is the transmission tax with its train of formalities of all kinds; this is the principal cause of discouragement to landowners, and especially to male landowners. It is on this side that the first fiscal reforms should be undertaken in order to rid agriculture of the bonds by which it is being strangled, and to give it the freedom now enjoyed by personal estate. We should not go so far as to advocate the placing of land upon actually the same basis as personal estate. That would be ac- companied by drawbacks, and would lead to undesirable speculations. We do think, how- ever, that it could be set free from its present shackles and made more easily transferable. Certain governments have already moved in 100 The Return to the Land this direction, and it would be easy to pro- ceed further. In the mean time would it not be possible to benefit the land by extending to it the simplified procedure in regard to purge and realisation du gage, which is the special privi- lege of the Credit Foncier? And could not the droit de mutation be at once altered and diminished? Is it not regrettable that this tax, which throughout the rest of Europe varies from i to 3 per cent, should reach in France 6*88 per cent, and with the stamp duty 10 per cent. ? What is there to prevent the droit de mutation from being transformed into a single taxe d'abonnement y as has been done in the case of mainmorte property and in that of personal estate? This simple transformation would mean a great step forward. The payment of a small annual tax would be infinitely less onerous than the immediate disbursement of a large sum representing several years' income; if spread over a great number of years this tax would fall in due proportion upon all the holders of the property, and this would greatly facilitate its liquidation. The purchaser not being forced to pay down a very large amount of money on the day he enters into possession, 101 The Return to the Land the passing of the land from one hand into another becomes much easier. Unfortunately, our legislators do not at pre- sent seem disposed to adopt these measures. On the contrary, the bills now being brought forward tend rather to augment the burden land has already to bear. It would be easy to demonstrate, for instance, that the impot global upon income, if established, would fall with all its weight upon real estate, which alone cannot elude the eyes of the Treasury; it will be another premium upon personal estate, which is so easily disguised; the rural exodus, instead of slackening, will gather strength. If the intention were to disgust and dis- hearten our agriculturists, no more ingenious method could be devised. They are sought out in the midst of their work, already so full of anxieties, and cross-examined in detail as to everything they are doing, what they are growing, how much they are earning, and even what they eat. Their sensibilities are hurt in every way. Every one is aware how difficult it is to get regular accounts out of farmers, even the most intelligent of them. This is not because of laziness or stupidity on their part, it is the 102 The Return to the Land outcome of distrust pure and simple to un- willingness to confide to any one the secret of their affairs. It is his nature to work from hand to mouth, each day for itself, and he is disinclined to calculate his expenses and profits in advance. Experience, perhaps, has taught that his expectations are too often all upset by the caprices of the weather, and he feels, there- fore, that figuring out things ahead is waste of time. He prefers his woollen stocking to the ledger. When it is full, he has had a good year ; when empty, a bad one. That is all he knows, and that is enough. This is the man we are to call upon every year to furnish a debtor and creditor account of his exact income, such as we require from a merchant or a manufacturer. This account in itself is very difficult to make out. Agricultural operations are not those of a manufactory or of merchandise, which are concluded almost always by certain specified dates; they may extend over long, indefinite periods. The yearly budgets cannot be regularly closed because the good and bad years overlap and intermingle and cannot be divided up. The real income of a farmer at the end of any single year is almost impossible to calculate. To try to reckon it up is to take for granted 103 The Return to the Land that certain operations will work out in a certain way, whereas the results may be quite different. The Treasury will find it a very difficult matter to cope with our farmers over these accounts. We pity the Government charged with such a duty. It is true that the supporters of this task have no fears. They hope that our country- folk, always pliable and obedient, will not have the courage to resist our all-powerful tax-collectors, and will bow their heads to the inevitable. Possibly it will be so, but in that case our victims will be all the more exasperated, and we are much afraid that their ill-humour will be turned not only against the gentry who have played them this turn, but also against the soil itself, the source of so many troubles and worries, and that they will abandon it in their eagerness to get out of the clutches of the Treasury. If we want to form an idea of the mental attitude of these countryfolk towards State officials, we have only to glance at what is happening now in the case of the distillers of our vin du pays. Nothing could be more suggestive and significant. The law had but 104 The Return to the Land to authorize an administrative visit to their vaults to put them into a veritable state of insurrection; and it is noteworthy that it is not the smugglers who have been getting most excited and indignant, it is the law- abiding ones. Their anger has reached such a point that a large number of them have given up distilling and allowed their fruit to rot rather than have anything to say to the Regie. However, the inventors of this income-tax, while aware of this danger, hope to avert it by sparing the bulk of small taxpayers exempting in the small communes all the farmers whose income is less than 750 francs, and levying only a very light tax upon all the lower grades of tax- payers. They hope thus to get their support in the struggle against the minority who are being mulcted. The hope is vain. The majority will soon have its eyes opened, and will perceive what to expect themselves. They will realize that, once it is put into action, the law will end by includ- ing every one ; when a financial snare of this kind is set, every one gets caught in it. When the Treasury discovers that the tax is not bringing in enough money, because the larger landowners are dividing up their estates to 105 The Return to the Land evade it (as is inevitable), it will have to fall back upon the lower categories and ask more from them. It will have to give its screw another twist. This income-tax must inevitably have the effect of increasing the depreciation of landed property. Who will care to invest his money in land with this sword of Damocles hanging over his head? Every one will want to sell and no one will want to buy. Personal estate and foreign securities alone will benefit. VI The weakest point in connection with our agricultural system, putting it at a great dis- advantage compared with our manufacturers, is the backwardness of its methods of sale ; efficient selling is essential to any industry that is to be prosperous; its profits depend on this. Now most of our farmers continue to sell in the primitive old fashion, without ever asking themselves whether this could not be improved upon, and without ever realizing its ruinous effects. Some of them take their goods to the nearest market and, after much loss of time, find they must sell their stuff at any price, no matter how low, 1 06 The Return to the Land so as not to have to take it home again ; others hand over their harvest to middlemen, who speculate in it, and get all the profit to be had out of the transaction. The total loss which results to them from their lack of organization can be easily enough calculated. We have but to compare the price paid by the consumer for the chief agricultural products with the price secured by the farmer, and multiply the difference by the total amount sold. The result is simply stupefying. Let us take the case of butcher's meat, for instance. We all know what enormous profits are made by the butchers in the big cities, though it is difficult to estimate them exactly on account of the number of factors known only to the butcher himself that can come into the sum. These profits are only to be learnt by becoming one's own butcher, which is practicable only for big concerns. One of the first experiments of the kind was made in 1892 by the Havre Almshouses. A careful analysis of it may be found in M. Felix Alcan's book "Les Questions Agricoles." He finds from his examination of the detailed and perfectly kept accounts, that for animals of very good quality the cost price was as follows : 107 The Return to the Land For beef ...... 1-44 francs the kilo. veal ...... 1-66 mutton ...... 1*87 ...... 1-53 The average price comes out, therefore, at i "40 francs. M. Zolla proceeds to note the price of the tongues, livers, etc., and finds that it brings the average up to 1*47. The next step was to find out the prices charged by the Havre butchers. To put his comparison beyond dispute, M. Zolla decided to take their lowest prices, and chose those which were obtained by contract by the Havre Lyc