U^J^ [?r1>P-^ t^r BV THE SAME AUTHOR THE DISTRIBUTION OF PRODUCTS. Or, The Mechanism and the Metaphysics of Exchange. Three Essays : What Makes the Rate of Wages ? • What is a Bank ? The Railway, the Farmer, and the Public. Second edition, much enlarged. Octavo, pp. v. + 365 . $1 50 " His remarks on the legislators of the country are vigorous and refreshing. The book, notwithstanding its statistics, is exceedingly interesting and is the ablest defense of capital that we have seen." — Chicago Advance. THE MARGIN OF PROFITS. How Profits are Now Divided ; What Part of the Present Hours of Labor can Now be Spared. Together with the reply of Mr. E. M. Chamberlin, representing the Labor Union, and Mr. Atkinson's rejoinder to the reply. (No. XL. of " The Questions of the Day .Series ") Cloth, 75 cents ; paper ...... 40 cents " This volume abounds in facts and statistics of first importance, and no student of the economic problems of the day should fail to give it a careful read- ing." — Boston Travetler. G. P. PUTNAM'S SONS, Publishers NEW YORK AND LONDON THE INDUSTRIAL PROGRESS OF THE NATION CONSUMPTION LIMITED, PRODUCTION UNLIMITED BY EDWARD ATKINSON, LL.D., Ph.D. I I AUTHOR OF "THE DISTRIBUTION OF PRODUCTS," "THE MARGIN OF PROFITS," ETC. NEW YORK & LONDON G. P. PUTNAM'S SONS ®b£ llnkhcrboclur ^xtss 1890 J J i> 3 J 3 3 i > J * ' ' ' , ' t ■ ' «■ C COPYRIGHT BY G. P. PUTNAM'S SONS Cbc HJiiichcrbocftcr press Electrotj'pcil ami Printed by G. P. Putnam's Sons ■It *. c 1 1 s Urn o t /7/.7 A87 ^ PREFACE. I VENTURE again to present to the public two series of articles which have appeared, one in T/ie Century Magazine, and one in The Foruin. I have made such slight corrections as have been found necessary. I have continued the statistics which have been previ- ously published down to the present date and I have added some other treatises not previously published, notably the Address, given to the graduating class of the University of South Carolina in which I have given very fully the motive of my work. I began the investigation of our national accounts early in the year 1862, wishing to demonstrate the ability of the Nation to bear any amount of taxation which might become necessary for the maintenance ^ of the national existence. At that time my own concepts of the great J5 problems in social science which I have since undertaken to treat, S were very vague and indefinite ; I held, however, a profound con- viction — I St. That the purpose of human life upon earth could only be the 35 development of the character and capacity of the individual through 2 the very struggle for material existence which seems to be so arduous. 2d. That mind and character must be the paramount factors in material production. 3d. That there must be a higher law leading through the correla- tion of mental and material forces toward an ample and abundant sub- ^ sistence and toward an equitable distribution. 4th. I held the profound conviction that these conditions of material welfare could only be attained by the development of indi- vidual intelligence, leading to the conception that in all commerce among men both parties serve each other. 5th That whenever the interdependence of men and of nations should become a part of the common knowledge of the people, peace, order, and industry would be adopted as the common law and practice of nations. 6th. As I have explored each branch of material production, it has become more and more apparent to me that the earth's capacity to sus- iii iv Preface. tain life has hardly yet been touched, and I have come to the definite conclusion that, while the power of mankind to consume the products of the earth is limited, the source from which man may draw satisfac- tion for his material wants is practically unlimited. When it first became apparent to me that the subject of our domestic commerce as well as of our foreign commerce must be limited substan- tially to the exchange of the product of each series of four seasons constituting one year, and that by so much as the few might attain a greater share of this product must others enjoy less, the conception that poverty might be a necessary correlative of progress in wealth under the competitive system for a time led me to question the equity of the present methods of distribution. This is, however, a very superficial view. To any one who searches thoroughly, it very soon becomes apparent that the competition of capital with capital, — of owner with owner, — of wealth with wealth, — tends to the reduction of profits to a minimum, while at the same time the use and application of capital under the direction of competent owners or agents increases the product perhaps in even tenfold greater measure than the share of such increase which the capitalist secures either in the form of rent, interest, or profit. Hence it follows of necessity that the share of the annual product which falls' to the capitalist must be almost in inverse proportion to the efficiency of the capital which he directs. In other words, as capital increases in its productive efficiency it becomes a factor in developing a constantly increasing product, of which a lessening part is secured to its owners. On the other hand, so long as workmen gain in intelligence and skill, they must of necessity secure to their own use and enjoyment a con- stantly increasing share of this steadily increasing product. It therefore fallows that each man may be held to make his own rate of wages as well as his own rate of profits by the measure of individual intelligence and aptitude which he is able to devote to the occupation in which he is engaged. The unequal distribution of the annual product therefore becomes equitable ; the only condition precedent being, that the government should not intervene either by direct or indirect taxation so as to divert the increasing product which is due to science and invention, either to the destructive purposes of war or to the preparation for war, or to the support of privileged classes. Whether or not such has been the effect of taxation on the debt- and army-ridden nations of Europe, may perhaps be indi- cated by the two studies on the " Relative Weakness and Strength of Nations." As these conclusions were gradually developed in part a pr-iori and in part from observation of existing facts and figures, the true function Preface. v of statistical investigation assumed a new importance, and in the light of these theories the following studies have been prepared. This conception of the mutual interdependence of men, and that the necessary relation of mutual service is the condition of general welfare, led of necessity to the conclusion that all trade and commerce should be free from any artificial obstructions created by law, except the regulation of noxious or unwholesome occupations on special grounds. It may happen that those who are ready to accept the logical con- clusions which are developed by the study of the national accounts and the statistics of international commerce, may be obliged to surrender their inherited ideas in respect to the proper functions of government, and may come to the conclusion that commerce should be free from any and all taxation except so far as the necessity of government for a revenue on foreign imports may render it necessary to impose taxes thereon. Whether I have succeeded or failed in impressing these views upon my readers, each one must judge for himself. If I shall have given a direction to the thought and life of the younger men of the present generation who are about to enter upon its arduous and busy duties, to the end that their conception of the meaning of life and their own enjoyment of life, of work, and of men shall be increased in the measure which I have succeeded in attaining for myself by the pursuit of these studies, then I shall have accomplished my purpose and shall be justified in all the work that I have done. Edward Atkinson. Brookline, Mass., July 4, 1889. CONTENTS. Preface The Industrial Progress of the Nation ; Consumption Limited, Pro- duction Unlimited — Commencement Address Delivered l)efore the Graduating Class of the University of South Carolina, June 26, 1889 The Food Question in America and Europe ; or. The Public Victualing Department ............ The Relative Strength and Weakness of Nations — Two Studies in the Application of Statistics to Social Science : I. — Strength ......... II. — Weakness ........ Low Prices, High Wages, Small Profits: What makes them? The Distribution of Products : I. — How can W^ages be Increased ? II. — Must Humanity Starve at Last? III. — Progress from Poverty IV. — The Progress of the Nation V. — The Struggle for Subsistence VI.— The Price of Life VII. — An Easy Lesson in Statistics VIII.— Reforms That do Not Reform IX. — How Society Reforms Itself X. — Remedies for Social Ills Theory and Practice (Supplement to No. X.) What shall be Taxed ? — W^hat shall be Exempt ? Production, Distribution, Consumption Slow-Burning Construction The Missing Science A Single Tax on Land . Religion and Life . Index PACK iii 33 53 80 lor 137 155 163 176 192 200 209 219 229 239 247 253 291 309 339 351 377 389 THE IxNDUSTRIAL PROGRESS OF THE NATION CONSUMPTION LIMITED, PRODUCTION UNLIMITED THE INDUSTRIAL PROGRESS OF THE NATION; CONSUMPTION LIMITED, PRODUCTION UNLIMITED. COMMENCEMENT ADDRESS GIVEN TO THE GRADUATING CLASS OF THE UNIVERSITY OF SOUTH CAROLINA, JUNE 26, 1889. GENTLEMEN : I imagine that it very seldom happens that one who has missed the training of the College or of the Univer- sity is called upon to make the Commencement Address to a graduating class, as I been invited at this time by your Faculty. Such, however, having been my loss in the process of education, you may not expect from me either a literary treatise or a philosophical essay ; I can give you only a few observations which I have drawn from the experi- ence of practical life. I have been for nearly fifty years engaged in the actual work of life in dealing with the material processes which are necessary to the support of mankind in comfort and welfare. I have had but little time for reading books, and I am not learned in economic science as it is laid down in the almost innumerable treatises which have been written under the title of Political Economy. I can only deal with the aspect of life from the standpoint of a workman, but I use the word " workman " in its broadest and not its narrow sense. The mind of man is the prime factor in the work of life. In the material work of production and distribution, without the work of the mind the hand would never have gained its power, or it would lose its cunning. The material processes which are necessary to existence, and which are conducted under the name of farming, manufacturing, trade and commerce, are sometimes looked down upon as being relatively inferior occupations — mere work for bread and butter ; or they are looked upon at least as not being entitled to the same place of dignity or estimation as the so-called " learned professions " ; but I claim for what may be called the unlearned professions a place upon the same plane and of equal stand- ing with all others, yielding precedence to only one, the highest of all • •• • . •• • "The Industrial Progress of the Nation. professions, that of the jurist. I render the highest honor to him, the law-giver, the true jurist, the man who of right provides against wrong, under whose impartial supervision laws are made and enforced, and by whom the rigid provisions of statute law, imperfect as it must always be, may be alleviated in the Court of Equity. Had I anticipated the honor which you have conferred upon me in granting me the Degree of Doctor of Laws, I should hardly havj ven- tured to incorporate in my address this estimate of the jurist. You may well conceive that my satisfaction is the greater because the pass- port which you have given me to enter my name among the learned in the higher law, carries with it a recognition of service measured more highly than I could have ventured to hope for. I most profoundly thank you for this recognition, and I shall value a Degree from the University of South Carolina more than any that could have been conferred upon me by any other institution of learning. So long as man dwells in this body upon the earth, the development both of the mental and the spiritual elements in human life must depend in great measure upon the manner in which the human body itself is sustained ; that is what bread and butter stand for, or as I believe Carlyle himself once named it, the " Potato Gospel." I might not again venture to quote to you the old and trite aphorism ^' Mens sana in corpore sano," had I not asked my friend Dr. William Everett to give me a similar aphorism which should indicate that even the spirit could not be rightly developed except in a well-nourished body ; to which demand he at once replied, " Non est animus cui non est corpus." Can there be a soul unless the body eats ? On the other hand, the very necessity which is imposed upon us to sustain the human body by manual and mechanical work re-acts upon the mind, and this tends to build up the character of the man himself in just and even proportion to his own conception of the true purpose of his own life. To him who has laith in a higher power which is both supreme and wholly beneficent, no matter from what source he may have derived his idea of the Eternal, there can be but one conception oi life itself. The premises on which that conception may be based must be, that this world is the best world that could have been made ; that the conditions of this life are the best conditions that could have been established for the development of mankind ; and that the strug- gle for existence, hard and severe as it seems to us, must be the necessary school by which man could have been elevated above the beasts of the field. If there could have been a better world or a better method for the development of mankind, man would have the right to ask his Creator why it had not been established. In other words, to me the alternative of Atheism is my own concep- tion that the whole purpose of life is beneficent and not maleficent, and Consumption Limited, Production Unlimited. 3 . that all shall share in the wise purpose of the Almighty to bring all to that conception of life which shall give rest and re-creation to the soul. In the material world, all we can do is to move something ; but if there were no obstruction to movement, if there were no friction, there could be no movement of any kind. So in the moral world, if there were no possibility of wrong- doing, there could be no right-doing. In the material world again, if there were no law of gravitation exerting its centripetal force, there could be no lifting of the clouds, no falling of the rain, no development of the plant, no life of the animal ; then no man could exist upon the earth to be elevated by the necessity of labor to the perception of his manhood, and by the development of his own personal character and intelligence to the domination of the forces of nature. If there were no material wrong to be overcome in the physical world, there could be no virtue in overcoming wrong ; and without the struggle in and with the physical world in order to attain true character, there could be no mental conception of the spiritual world which is around us and beyond us. It follows then that the three phases of our life upon the earth, the material, the mental, and the spiritual, cannot be separated ; they are complements of each other, each necessary to the other ; therefore each phase of life must be developed in harmonious relation to the others. May we not then assume that the beneficent purpose of that part of our lives which is passed upon the earth in which we are forced to keep up the struggle and to labor for existence, is the building up of each individual character by way of that very struggle ? Would not the work of life otherwise be wholly without meaning? This is the true " potato gospel." It is tiot a dismal science. The ex- perience of men and of nations may sustain this principle. We can seldom help those who cannot help themselves, and the sentiment of philanthropy often leads to mistaken efforts to remove the necessity for labor. We may alleviate want, and our humane sym- pathies compel us to do so when called upon ; but we cannot remove the causes of poverty by giving relief, only by showing how relief may be earned. We can maintain great bodies of men if we have the capacity to dominate over them, by directing their mere physical force to the supply of their material wants, without mental effort on their own part ; but such conditions are dangerous to him who assumes the con- trol, and are also degrading to those who subject themselves to such domination and control. There can be no great progress in a community where a privileged class assumes a superior position, and, holding it by force or cunning, undertakes to protect an inferior class from the consequences of their own ignorance. In any well-organized society, equality of rights and 4 The Industrial Progress of the Nation. the recognition of the law of mutual service are the necessary con- ditions on which only must rest any true and permanent progress even in material welfare. Every one knows how easy it is to render those who are willing to be helped without rendering corresponding work or service ever more and more incapable of helping themselves. What we can do is to remove obstructions from their way, to provide for their education, and then to give all an equal opportunity with our- selves to work for their own living under just laws assuring equal rights. Let us then analyze this work of life. One half the work of life in this most prosperous country is even to-day of necessity devoted to the mere purpose of obtaining food. Why should this struggle for food have been permitted ? What does it mean ? The greater part of the surrounding atmosphere consists of nitrogen ; yet the most important and costly element of our food is nitrogen in such a form that it may be capable of being absorbed by plants and thereby converted to the subsistence of men. There are great tropical sections of the world in which the conversion of the nitrogen into plant life through the rapid decay of all organic forms yields most abundant subsistence. But we do not look to the tropics for the development of the highest type of manhood. If what are called favorable conditions for the most abundant product did in fact develop the highest type of man, we who dwell far away amid the granite and ice of New England might in truth have some cause to fear for our future. Midway between the tropics and our zone, which is sometimes called Temperate — perhaps because it is subject alike to tropical heat and to polar cold, and can only be called Temperate on the average, — comes in your Sunny South. Dividing the Sunny South midway is the terra, no longer almost incognita, as it was when I first ventured to picture it, the Land of the Sky. How many of you, I wonder, yet know what opportunities you have at your disposal, waiting no longer for Northern capital but now being developed by Southern enterprise ? Was I wrong when, but a few years since, I ventured to describe this land, in which, until a very recent day, two or three million homespun people still using archaic forms of English speech, were almost the only dwellers ? Was I wrong when I said that if a line were drawn southerly from the Potomac along the easterly margin of the Piedmont plateau, westerly on the southern edge of the uplands of Alabama, northerly to the Ohio along the margin of the Cumberland plateau, taking in that most fertile and. beautiful country that eye hath ever seen, the blue-grass region of Kentucky, and back again to the point of beginning, — that boundary would enclose an area more than three fourths as large as France and twice as large as Great Britain, containing potential in agriculture Consumption Limited, Production Unli7nitcd. 5 equal to either, with minerals and timber equal to both combined ? That land was waiting only for the mind of man to become the prime factor in production. That I was not wrong, let the great enterprises of the New South bear witness. I need not name them. Over this great stretch of country the glacial drift never passed ; the soil consisting of the disintegrated rock of the old Laurentian Chain is rich in all the elements of fertility that give the strength to your timber and the beauty to your mountains ; on which, within two hundred miles of distance east and west from the border of the Piedmont plateau to the top of Roan Mountain you may find the whole //er capita increase of grain. If objection be taken that the agricultural statistics of 1865 were incomplete, because taken so soon after the war, reference may be made to the average of the decade 1865 to 1874 inclusive, in which years the crop of grain averaged 37tVo bushels per head, as against the average of A^^Hq bushels per head in the years 1875 to 1885 — a gain of over twenty-seven per cent, per capita. The gain is really greater than is indicated by this percentage, because the proportion of our population which was engaged in agriculture was less in the sec- ond period than it was in the first. In 186 1 the railway service between the East and the West had for the first time become a unit, by the completion of various sections of railway connecting the whole system at many points. The impor- tance of this fact in its connection with the power of the North to concentrate its armed forces, and to supply them with food during the civil war, has yet to be treated. It was an important factor in the power of the North to maintain the integrity of the nation. It was not until 1869 that the first consolidation took place of a through line under one management, from Chicago to the seaboard. This was then accomplished by the late Cornelius Vanderbilt. In 1865 the average charge for moving a ton of produce from Chicago to the seaboard, and for moving general merchandise from ' Reprinted from The Century Magazine for December, 1886. 33 34 The Industrial Progress of the Nation. the East to the West, was at the rate of three cents and forty-five hundredths per ton per mile. In 1885 it was sixty-eight hundredths of a cent for the same service. If we take certain typical quantities of flour, beef, pork, corn, dairy products, and of fleece wool, weighing thirteen tons, their value at the market prices for export in the city of New York in the year 1865 was $1,124.33, either for export or for domestic consumption, and they remained substantially at this value during the years 1866, '67, and '68 — the period of paper inflation. The cost of moving thir- teen tons one thousand miles over the New York Central Railroad and its connections in 1S65 was $448.63, leaving to the producer or his agent in Chicago the net sum of $675.70 in paper money, equal to $475.76 in gold. The same quantities of the same articles were worth in the city of New York in June, 1885, $575.98 in gold. The cost of moving them a thousand miles was $88.40, leaving to the producer or his agent $487.58 in gold. But in the interval the efficiency of the farmer, measured by the increase in the grain crop per capita, had in- creased by sixty per cent., so that he could have placed twenty tons in New York in 1885, as against thirteen tons in 1865, the value of which, after deducting the freight, was $780.13. These figures may explain facts which are of common observation. The old mortgage debts have been paid, and the rate of interest on capital in the West now differs little from that in the East on the same security. Thus it appears that, notwithstanding a reduction of price by one half, the increased efficiency of the railway service and the restoration of the gold standard of value have enabled the farmer of the West to grow rich on the low price of produce, where he would have inevitably become poor under the former system of paper money, high prices, and heavy railway charges. If we apply the rates at the two periods to flour, as an example of the average food of the people, at ten barrels per ton of 2,000 pounds, — which is within a fraction of the true quantity, — the cost of moving a barrel of flour 1,000 miles in 1865 was $3.45. In 1885 it was 68 cents. The average ration of wheat-flour to each adult person in the United States is well ascertained to be one barrel each year. Our population is now computed at somewhat over 58,000,000, or, if we rate two children of ten years old or under as one adult, we number in our consuming power 50,000,000 adults, each requiring one barrel of wheat-flour a year, all of which is moved on the aver- age at least 1,000 miles from the producer to the consumer. Before railways were constructed, grain which was 150 miles distant from a waterway could not be moved that distance without an expenditure about equal to its value. If wheat had been subject in 1885 to the charge of 1865, the cost of moving 50,000,000 barrels of flour 1,000 The Food Question in America and Europe. 35 miles would have been $172,500,000. At the actual charge of 1885 over the New York Central line, at the average trafific charge of the year on all merchandise, of 68 cents, the cost was $34,000,000, a dif- ference of $138,000,000 on the flour only. Bread, however, is a less important factor in the subsistence of the people of this meat-consuming country than it is in other countries. In the Eastern and Middle States recent investigations of the Bureaus of Statistics of Labor — especially in Massachusetts — sustain the sub- stantial accuracy of previous computations made by the writer from the accounts of factory boarding-houses as to the average standard daily ration, or cost and quantity of the daily supply of food materials of adults who are occupied in the work of every-day life as artisans, mechanics, factory operatives, or laborers. The average in the fac- tory boarding-houses — the occupants being mostly adult women — comes to 24 cents a day. A fair average cost of food for men and women engaged in manufacturing and mechanical arts appears to be 25 cents a day, varying in some measure in respect to the proportions, as the dietary of men varies somewhat from that of women, working- men consuming more animal food than the average of factory opera- tives, who are mostly woqpen. This daily ration consists of the following elements : Meat (including poultry and fish, a half to one pound, according to kind and quantity) at an average cost of lo cents Milk (half pint to one pint), butter (r io 1)4 ounces), and a scrap of cheese 5 " Eggs (one every other day) at 12 cents a dozen )4 " Total cost of animal food 15/^ cents Bread (about ^ of a pound) 2 J^ Vegetables (green and dry) 2-2)4 Sugar and syrup 2 Tea and coffee i Fruit (green and dry) )4 Salt, spices, ice, and sundries i^-i Average cost of daily ration 25 cents The proportions vary somewhat under different conditions, but they may be taken as a fair average standard ration for adult workmen and women. In the West the prices of meat and grain are less ; the prices of groceries somewhat higher ; but, on the whole, the same quantity of food can be purchased at somewhat less cost. In the South the habits of the people — especially of the colored race — are very different. Dairy products are much less used, and with the negro corn-bread 36 The Industrial Progress of the Nation. and bacon (hog and hominy) take the place of most other varieties of food. On the whole, however, the proportion of wheat-bread to the other elements of the daily ration may probably be established at the proportion of one tenth of the whole ration. If we, then, save $138,500,000 per year in the cost of transportation on our bread bill only, do we save tenfold on our whole food supply ? Is our food, on the average, moved a thousand miles, either by railway or by waterway? No exact reply can be given to this question. We find, however, that the tonnage which was moved over all the railways of the United States in the year 18S3 represented, on the average, a fraction over seven tons to each inhabitant, man, woman, or child, moved an average distance of no miles. In 1884 this quantity was slightly reduced per capita, but the distance was a little greater. The charge for this service in 1884 was $8.75 per head of the whole population. In 1885 the quantity was a little more, the average per ton a little less, and the gross charge per person was $8.88. The largest single item of this traffic — probably one half — consisted of food for man or beast. When to this is added merchandise moved by water- ways and by wagon, and when consideration is given to the fact that all these materials must be sorted, converte(^ reconverted, and finally distributed in small parcels by wagon or by hand, so that every adult person may be sure to have from three to five pounds of solid food and one to two pounds of liquids, together with the necessary modi- cum of fuel, clothing, and shelter, the mere mechanism of subsistence can be comprehended, and the relative importance of the victualing department may be fully realized. The average cost of the food materials in the Eastern and Middle States has been given. The people of these sections are even more dependent on the mechanism of distribution than any others. Their proportion of the railway tonnage must be double, in respect to dis- tance, that of the inhabitants of other sections ; and yet such is the perfection of the railway service at the present day that one day's wages of a common mechanic — or one holiday in a year devoted to work in Massachusetts, will pay the cost of moving a year's sup- ply of bread and meat from the prairies of the West to the centre of Eastern manufactures. This fact cannot be too often repeated. In view of these data, if the gain compassed in twenty years in the cost of moving bread alone has been $138,500,000 for one year, how much do we now save on all the necessaries of life ? No abso- lute reply will be attempted ; but it may be remembered that by way of the railway, waterway, and steamship the whole world has been converted into a neighborhood. Within the lives of very many men now living, each little area of this country practically depended upon its own labor for its own food. To-day the wheat of Oregon and of The Food Question in America and Europe. 37 California is carried around Cape Horn to England at a fraction of its value, while half the people of Great Britain derive their food from India, Australia, and America, or from fields which are from six to thirteen thousand miles away. A cube of coal which would pass through the rim of a quarter of a dollar will drive a ton of food and its proportion of the steamship two miles upon its way from the pro- ducer to the consumer. The great hotels of New York run special railway cars for carrying eggs from Michigan to New York, and yet we import hens' eggs in considerable quantity from Denmark and from Holland, If each adult in the United States consumes one egg every other day, at only twelve cents a dozen, which is the proportion of the factory operatives of New England, the value of our hens' eggs is ^91,250,000 per year, or twice the value of the product of silver bul- lion, 25 per cent, more than the value of our wool-clip, and greater than the value of the entire product of our iron furnaces, even if we increase the product of pig-iron this year to 5,000,000 tons at $17 a ton, at the furnace, or $85,000,000 in the aggregate ; at which figures our iron industry would greatly prosper. I may venture to give once more a table which shows statistically the food bill of the people of this country, upon the assumption that each average adult ought to enjoy as good a supply of food as the adult factory operatives, mechanics, and artisans of New England and the Middle States : Per day. Aggregate per year. Meat, fish, and poultry lo cts $1,825,000,000 Milk, buttcr.and cheese 5 " 912,500,000 Eggs (one every other day) \ " 91,250,000 Animal food I5i cts $2,828,750,000 Bread (| lb. per day) l\ " 456,250,000 Vegetables 2^ " 456,250,000 Sugar and syrup 2 " 365,000,000 Tea and coffee I " 182,500,000 Fruit (green and dry) i " 91,250,000 Salt, hjiices, ice, and sundries I " 182.500,000 25 cts $4,562,500,000 Deduct probable excess on sugar, tea, coffee, and dairy products 262,500,000 $4,300,000,000 Add spirits and fermented liquors at the average between the estimates of Mr. D. A. Wells and the advocates of prohibition about 700.000,000 Probable price of food and drink constituting the victualing department for one year at the present time $5,000,000,000 These figures are, as to each separate item, greatly in excess of ordinary computations, very few persons ever daring to estimate the 4S3037 38 The Industrial Progress of the Natioti. entire dairy product of the country at over two thirds the sum which is given in this table. In explanation of this discrepancy, I may state that few persons comprehend the great cost of distributing food in small parcels at retail. Perhaps the most difficult problem in the victualing department is to reduce this element of the cost of food. For instance, in the foregoing dietary the estimate for bread is three quarters of a pound per day, at a cost of two and a half cents, which would be at the rate of three and one third cents per pound of bread, a quantity corresponding to the ration of one barrel of flour per year to each adult, each barrel yielding two hundred and eighty pounds of bread. Now, there is only one place within my knowledge where good bread can be purchased at so low a price as three and one third cents per pound ; that is in the shops of the Howe National Bakery in New York. In Boston I find the average price of bread which is sold in the bakers' and grocers' shops to be more than five cents per pound, at which price the larger population of this city is served. At five cents per pound the bread of the people of the United States would come to $700,000,000, in place of $456,250,000. It therefore follows that if the food bill of the people is not in quantity what this standard calls for, the reason is that the average dietary is not up to this standard, even after making the admitted deduction for the excess of tea, coffee, sugar, and dairy products which is consumed in the East, as compared to other parts of the country. In order that some idea may be gained as to the accuracy of the proportions which are given in this dietary, I have been enabled, by the courtesy of Mr. McHugh, Chief of the Bureau of Labor Statistics in Ohio, to give the average cost of the daily rations of the inmates of the insane asylums and of the reformatory institutions of Ohio. It is as follows : Meat (including fish and poultry) cents t^^ Milk, butter and cheese " 3^'^ Eggs " ~h Animal food " 10 Sugar, syrup, salt, spices, and other groceries (including beans and lard). . . " 'z\ Bread " 2jV Vegetables and fruit (green and dry) " 2 Tea and coffee '" -^^ Total per day " iTjj- Number of persons subsisted for one year 6256 Many other comparisons might be made from the excellent reports of other Bureaus ; but this will suffice to establish the proportions of the victualing department. The Food Question in America and Europe. 39 It is admitted that the ration of sugar, tea, coffee, and dairy prod- ucts in the previous table is too high ; but if, after making deductions for these elements of subsistence, the price of whiskey and beer be added at the average between the lowest computation of the skilled economist, Mr. David A. AVells, say about $500,000,000, and the esti- mate of prohibition advocates, $900,000,000, there can be no question that the total cost of food of the people of the United States is $5,000,- 000,000 ; and at this estimate it doubtless represents one half the price of life measured in money to at least ninety per cent, of the population who do the actual physical work of the whole community. It is a well-established fact that, with respect to the more thrifty and prosperous classes of mechanics, artisans, and other so-called working-classes, as well as in regard to the larger proportion of salaried classes, one half the cost of living is the price of materials for food. As we go down in the grade of work to the level of the common laborer who can earn but from 80 cents to $1.25 per day, the propor- tionate cost of food materials rises to 60 and even 70 per cent, of the income of the family. Thus it appears that, notwithstanding the improvement in the mechanism of distribution, and in spite of the enormous increase in the per capita product of grain and other food, great numbers of per- sons, even in this country, can barely obtain their daily bread, while want exists in the midst of plenty. Why is this ? Is it not because we waste enough in ignorant buying and in bad cooking to sustain another nation as numerous, and because no common attention has yet been given to what may be called the Art of Nutrition ? The writer only ventures to refer to this art in anticipation of a series of articles upon the Science of Food, which are to be given in future numbers of The Century by Professor W. O. Atwater, to which this article may serve as an introduction. It is important to determine the causes of these false conditions in the United States. More difificult yet are the problems in such coun- tries as Ireland and Egypt, each name representing one of the m.ost productive areas of the earth's surface, capable of sustaining a greater population than exists in almost any other country in proportion to area, and yet both stricken with poverty, almost with famine. Why are fertile districts of northern Italy devastated by the pellagra, a loath- some disease which is induced by insufficient nutrition ? Why has the Government of Germany undertaken to instruct the people in the art of nutrition, lest the sordid conditions of great districts should end in socialism, nihilism, and violent revolution ? What is the most import- ant department in the political questions of Europe to-day ! Is it not the Victualing Department ? It must be remembered that, in the nature of things, there must be 40 The Indtistrial Progress of the Nation. a substantial equality in the daily supply of food, so far as weight and the elements of nutrition are concerned. If the masses of the people are to be well nourished, each adult person must have the due propor- tion of protein or nitrogenous material, of fats, and of carbohydrates or starchy materials, because if either one is deficient vital force cannot be sustained. Neither can there be any true mental vigor or spiritual life when the body is not well nourished. " Noii est animus cui non est corpus." So far as any disparity can be admitted, the workingman or common laborer requires more than any one else. His food is his fuel, and his physical exertion must be sustained by a sufficient supply with the same regularity and certainty that the boiler of the steam- engine must be fed with coal ; and, in fact, it will appear in Professor Atwater's future treatment of this subject that, although the standard rations which have been established as necessary to sustain a working- man in full vigor by several leading authorities in Germany, France, and England vary somewhat in the relative proportions of protein, fats, and carbohydrates, yet when reduced to calories, or mechanical units or equivalents of heat, they correspond almost exactly each to the other. He will also show that it has been found expedient for the employers of labor in certain brickyards of Massachusetts and Con- necticut to serve their workmen with a supply of the best food which represents in its chemical proportions, as well as in its calories, twice the ration which is served to the soldier of the German army when upon a forced march, or when engaged in the most arduous struggle of active service in war, in order to promote the largest production of brick per man at the lowest cost to the employer. The actual production of the principle element of food in the United States, to wit, the grain crop, has been given. Attention has also been called to the perfection to which the mechanism of distribu- tion has been brought. A few words may now be given to the use of land — the source of nearly all our food. The arable portion of the United States is com- puted at more than one half the total area of 3,000,000 square miles, omitting Alaska. Of this portion only 282,500 square miles are yet put to actual use in the production of grain, hay, roots, or other articles of food, omitting only that proportion of animal food which beasts derive from pastures. The several areas of arable, pasture, and moun- tain land are given below, and in the portion set off as pasture-land are given the areas which might suffice for a much larger production of beef, dairy products, mutton, and wool than we now enjoy, if known methods of agriculture were intelligently applied to these arts. In the accompanying diagram the outer square indicates the total area of this country, omitting Alaska, substantially 3,000,000 square miles. This square has been subdivided into three parts. The upper The Food Question in America and Eitropc. 41 half or section represents, in a rough-and-ready way, the arable land of the country. What is called arable land really constitutes a larger portion, but one half at least may be called fairly good land.' The lower half is divided into two sections. One of these sections fairly represents pasture or grazing land, too dry for agriculture with- out irrigation, but capable of sustaining great flocks and herds. The other portion is assigned to mountain and timber. But even this part has many fertile valleys, and much of it may be made use of for the production of food. OUR NATIONAL DOMAIN. WHAT \VK IIAVF. DONE WITH IT, AND WHAT WE MICIIT DO WITH IT. Section i. Arable Land — 1,500,000 Square Miles. IN ACTUAL USE. O 3 o 8 2 o . s 8 ^ ^ o ■-' 302,500 square miles now produce all our grain, h:iy, cotton, sugar, rice, and garden vegetables. Section 2. Pasture-Land. WHAT MIGHT SUFFICE. (/) » V d a rt a V a V 2 a 3 3 W cr p (A 0* Q Q e VO ^' (A square mile = 640 acres.) Section 3. Mountain and Timber. Compiled from the records of the Agricultural Department and other sources. Within the lines of the upper half, certain proportions drawn on the same scale as the outer square, which represents the total area, will be .observed. These smaller sections represent proportionately the actual cultivation, as it now is, in its ratio to the whole. ' The following analysis of the use of land has been previously submitted in " Bradstreet's " by the writer. 42 The Industrial Progress of the Nation. CORN AND PORK. Our average crop of Indian corn ranges from 1,800,000,000 to 2,000,000,000 bushels. At twenty-five to thirty bushels to the acre, the area of the cornfield is only 112,500 square miles, or less than four per cent, of the total area of the country. Our customary average is less than thirty bushels, but on the best land fifty bushels are commonly produced, and sometimes one hundred. Corn may be reduced to pork at the ratio of about one bushel to ten pounds, including waste. WHEAT. About 60,000 square miles are all that are required or are now under cultivation in wheat. At only thirteen bushels to the acre, this little patch, constituting but two per cent, of our total area, would yield 500,000,000 bushels of wheat. This quantity, after setting aside enough for seed, would supply 80,000,000 people with their customary average of one barrel of flour per year. HAY. A hay crop of 40,000,000 tons, at the average of a good season, one and a quarter tons per acre, calls for less than two per cent., or 50,000 square miles. OATS. The oat crop of between 500,000,000 and 600,000,000 bushels, at thirty bushels to the acre, calls for one per cent., or 30,000 square miles. COTTON. While the cotton crop has never reached 20,000 square miles, or two thirds of one per cent, of the entire area of the country (less than two and a half per cent, of the area of the strictly cotton States), yet on this little patch, at the beggarly crop of one half to three fifths of a bale to the acre, 6,000,000 to 7,000,000 bales can be made each year. MISCELLANEOUS. Lastly, all our miscellaneous crops of barley, hay, potatoes, and other roots, of rice, sugar, tobacco, hemp, and garden vegetables, are raised on one per cent, of our area, or 30,000 square miles. POSSIBILITIES. It is perfectly safe to affirm that, were a reasonably skilful mode of agriculture generally applied to these crops, the area now under culti- vation would yield all that could be required by double the present population of the United States, and would yet leave over as much as we now export. The Food Question Ui America and Europe. 43 In the square which has been set aside to represent pasture-land certain subdivisions have been made which represent what might be done with the land, not what is done with it. Our cattle truly roam over a thousand hills and over wide plains, under the worst possible conditions for the best production of meat, or even of dairy products. When an intelligent and an intensive system of farming shall have been adopted, and when each one of the Eastern States (with the possible exception of Delaware and Rhode Island) shall produce within its own limits all its own meat and its own dairy products (as may soon hap- pen), the area set off for beef, dairy, mutton, and wool will more than suffice. BEEF. The area assigned to beef is 60,000 square miles. This would yield each year one two-year-old steer to every two acres. It is now ad- mitted, as has been frequently proved, that sufficient green fodder can be made and saved in pits, under the name of ensilage, to carry two steers to one acre. The additional nutriment — meal from Indian corn, cotton-seed meal, or hay — has been already provided for in the area set off for these crops. At the rate of one two-year-old steer taken off each two acres, each adult inhabitant of the United States, counting two children of ten years or under as one adult, could be served with very nearly one pound of dressed beef per day. DAIRIES. The area set aside for dairy products is also 60,000 square miles. At the ratio of one cow to each two acres, fed on ensilage, cotton-seed meal, and a modicum of hay, there would be a yield of fifty per cent, more milk, butter, and cheese than the people of the United States now enjoy ; while the eggs, valued at the present time at not less than $90,000,000 a year, and probably at $120,000,000, could also be doubled in the same area. MUTTON AND WOOL. To a similar area of 60,000 square miles mutton and wool are as- signed. Were sheep folded and fed as they are in England and in some parts of this country, protected from cur dogs and properly nourished, wool to the amount of 500,000,000 pounds a year (which is more than our present entire production and import) could be readily produced from this little patch, together wath a greater secondary product of mutton and lamb than we now consume. CONCLUSIONS. It may therefore be inferred that, for the present at least, there will be no danger of starvation within the limits of this country, or of the 44 The Industrial Progress of the Nation. exhaustion of our land. No one yet knows the productive capacity of a single acre of land anywhere. When land is treated as a laboratory and not as a mine, subsistence may become more of a science than it now is, and neither prosperity nor adversity may then be attributed either to abundance or to lack of land. In this connection it may be well to say that the distribution of the farm-lands of the United States is one of the most important factors in the social order. In 1880 the census disclosed the following facts : Total number of farms 4,008,907 Cultivated by owners 2,984,306 Rented on shares 702,244 Rented for money payments 322,357 Average size of farm, acres 134 Farms of 50 acres or less. 1,175,564 Farms over 50 and not exceeding 500 acres 2,728,973 Farms of over 500 acres 104,550 From these facts it may appear that if there is want in the midst of plenty in our own land, and if there is any difficulty in procuring daily food, it may not be attributed either to lack of land, want of capital, or scarcity of laborers. The modern miracle of the loaves is this : One man working the equivalent of three hundred days in the year, or three men working one hundred days in the harvest season on the far plains of Dakota in the production of wheat, aided by one man working three hundred days in milling and barreling the flour, and supplemented by two men working three hundred days in moving wheat and flour from Dakota to New York, and in keeping all the mechanism of the farm, the mill, and the railroad in good repair — four men's work for one year places one thousand barrels of flour at the mouth of the baker's oven in the city of New York — a yearly ration of bread for one thousand men and women. What, then, is needed in order that all alike may have their neces- sary equal share of food — their three to five pounds per day of grain, meat, vegetables, and products of the dairy, and the like ? Is it not a knowledge of the alphabet of food ? Is not the missing factor in our material welfare to-day the want of a common knowledge of what food to buy, and how to cook it ? Half the mere price of life in money is the price of food. If we add to this the household labor in its pro- portion, the measure of the cost of food in terms of labor is far more than half the work of life. How many eight- and ten-hour men have fourteen-hour wives, whose work is toilsome and continuous, day in and day oiit, almost night and day, for the support of their families ! Although the food question is one of grave importance, even in this country, there can be with us no i)Ossible scarcity of food. Nearly one fifth part of the products of agriculture (including cotton) is exported The Food Question iip America a7id Europe. 45 to feed and clothe the people of other lands. In return for these ex- ports — the grain which we could not consume, and the cotton which we could not spin, and the oil which we could not burn, because there is enough and to spare besides — we receive our great volume of imports in exchange for what we export, which has been divided into the follow- ing proportions by the measure of value in money, according to the average of recent years : Articles of food and live animals $200,000,000 Articles in a crude condition, which are necessary in the processes of domestic industry 160,000,000 Articles fully or in part manufactured, which are used in the domestic arts or manufactures 75,000,000 Total $435,000,000 Manufactured goods ready for final consumption $130,000,000 Articles of voluntary use which may be classed as luxuries. . 65,000,000 195,000,000 Total $630,000,000 The proportion of the product of agriculture exported varies year by year. If the declared value of exports be compared with the valua- tion of all crops at the farms, it ranges from twenty to twenty-five per cent. A fairer comparison is to extend the farm values to the final values at wholesale in the principal markets. The writer applied this method to the census figures of 1880 with the aid of other experts. The conclusion was that the wholesale value of all crops at the centres of wholesale distribution in the census year was a little less than $4,000,- 000,000. Of this quantity somewhat over $700,000,000 worth was ex- ported or over seventeen per cent. ; the proportion is now less. In the production and movement of the crops to the centres of dis- tribution 8,000,000 men were occupied, of whom seventeen per cent, or more, say 1,360,000, depended on a foreign market. In- return we re- ceived imports classified as above, of which more than two thirds con- sisted of articles of necessity or common comfort. It is in this way that the interdependence of nations asserts itself in spite of the obstructions of time, distance, and taxes, and that in all true commerce men and nations serve each other, both parties making a gain in every exchange of product for product. The enormous export demand, especially of European countries, upon us for food, which is brought into notice by the fact of our large exports, brings into conspicuous observation the urgency of the de- mands of the victualing department, especially upon the continent of Europe ; while the simple fact that several European states have obstructed the import of provisions from this country by heavy duties, or have absolutely prohibited the import of our pork upon the false 46 The Industrial Progress of the Nation. pretense that it is especially unwholesome, bears witness also that although the wages of labor in these countries are very low, yet the cost of the production of food, as measured by labor or in money, is very high. Where the product of agriculture is relatively small in pro- portion to the population and to the demand or purchasing power, it follows of necessity that the wages of labor must be very low, and the subsistence of the people inadequate. Only one or two examples can be given within the limits of this article. I am permitted to give the following data, which have been furnished me by one of the most intelligent official observers in Germany, Consul J. S. Potter of Crefeld, Germany, in a report on the condition of German agriculture.' From this report I find that the income of a Prussian farm laborer, employed as first hand upon a large farm, whose family consisted of himself, his wife, and five children, all under thirteen years old, averaged as follows in a recent year : Wages of husband $142.80 Wages of wife in harvest time 11.90 Value of pork and potatoes raised and consumed 47-6o Value of goat's milk and vegetables sold 26.18 Total income $228.48 EXPENSES. Wheat-bread $ 7-14 Rye black bread 24. 75 Pork and potatoes (valued as before) 47.60 Cheese 4.95 Syrup 5 .00 Coffee 3.71 Salt, pepper, and sundries 1.24 Total food for seven persons for one year $94-39 This makes a cost of three cents and seven tenths per day per per- son. If the five children under thirteen be computed as two and one half adults, making the family equal to four and one half adults, the average per day is only five and three quarter cents. In my investigations of the food question I have found no statement of the food supply of a thrifty workingman and his family so meagre as this, or at so low a cost per capita. ' These reports and others of equal value have since been published among the consular reports issued by the State Department. Attention may well be called to these reports. At the request of the Secretary of State, the representatives of the great industries of the country prepared very careful forms of interrogatory in respect to the several arts on which reports were desired, including agriculture. Responses to these questions thus prepared by exjjerts are now being published, so that the reports of such consuls as have the capacity to report facts are becoming of great value to the student of social science. The Food Question in America and Europe. 47 It may be interesting to give the other items of expenditure of this thrifty German peasant : Clothing $39-97 Rent of house and three quarters of an acre of land 35-75 Fuel and lights 14-24 Oil, soap, etc 3.71 Meal for goat and pig 16.66 Beer and tobacco 7. 14 Sundries 14-28 Making a total expenditure for a family of seven persons $226. 14 In this same neighborhood, which is one of the most fertile parts of Prussia, the wages of other farm laborers who are supplied with food by their employers are as follows : First laborer per year, $71.50 with board. Second ' 39.25 " Third " " " 26.18 " Average wages per year, $44.25, or less than $4 per month with board. But when we turn to the production of a first-class Prussian farm and its cost, we find the product of a fraction less than ninety-one acres of land, which had been cultivated in a most skilful and intelligent manner, valued in all at $3,942.47. Part of this product consisted of wheat, the cost of which is given at eighty-four cents per bushel of sixty pounds. Another portion consisted of rye, the cost of which is computed at sixty-eight cents per bushel of fifty-eight pounds. It will be observed that although the wages of the farm laborer in this section average less than four dollars a month, with board added, the money cost of a bushel of wheat is set at eighty-four cents. In our great wheat-producing States and territories of the Far West wages are four- to five-fold, with board, and yet the cost of a bushel of wheat in some places is not over one half, or forty-two cents a bushel. It may be alleged that this is because we are converting the original fertility of a virgin soil into wheat, and thereby exhausting the land ; but the rule holds true in only a little different proportion in the wheat-producing counties of New York and Pennsylvania, where fertilizers are as much required as in Germany. Wages in these sections are as high as those in the Far West, while the cost of wheat in money is not over two thirds of that given as the cost in Germany at the farm. It is interesting to consider the dietary of this prosperous Prussian farmer. The food is nearly one half black bread made of rye. The proportion of meat is very small, as compared with the rations of this country. His family consisted of nine persons, three being children of 48 The Industrial Progress of the Nation. over fourteen years of age. Their total living expenses for the year were $736.28, divided as follows : Food $300.41 Clothing 119.00 Fuel and light 23.89 Beer, wine, and spirits 7I-40 Cigars, tobacco, and entertainments 47.60 Sundries 29. 75 School expenses, and maintenance of son in army 144-23 Total $736.28 The cost of food per person each day is nine and a quarter cents.' It is singular to compare the school expenses, the support of the son in the army, and the beer, wine, and spirits with the food bill. The food supply of this farmer, whose book accounts appear to have been kept with the accuracy of a merchant, and whose method of cultivation, as described, might serve as a lesson anywhere in scientific agriculture, is less in quantity and variety, and less in cost by at least one third, as compared with the rations which are served in the prisons of Massa- chusetts. The significant item in this expense account is the maintenance of the son in the army. There are, of course, many other causes, aside from the military system of Europe, for the differences which are to be found in the subsistence of the people, which cannot be treated in the limits of this article. For instance, the relative area and population of European states, aside from Russia and Turkey, enter into the consideration. The area is about one half that of the United States, while the popula- tion is little more than eight-fold, the ratio to the square mile being a little less than twenty in this country and one hundred and sixty in Europe. This area is divided into fifteen empires, kingdoms, or states, omitting the petty states of eastern Europe, which are separated from each other by differences of race, creed, and language. Their com- merce is obstructed among themselves by as many different systems of duties upon imports as there are states. The natural outlet for the crowded population of central Europe might be in southern Russia and in the fertile sections of Asiatic Turkey, were the relations of these several states to the eastern country the same as those of the Eastern States of this country to those of the West. There is land enough, and to spare ; but the armies of Europe are sustained in order to prevent this very ' For further comparisons of the food supply of working people in different countries, reference may be made to the first report of the National Bureau of the Statistics of Labor, by Hon. Carroll D. Wright. The Food Question ut A iiierica and Etirope. 49 expansion of the people ; and the misgovernment of the Turk, which renders Asia Minor almost a howling wilderness, is protected by the mutual jealousies of these very states, which are thus being destroyed by their own standing armies. As war becomes more scientific, it becomes more costly. Victory rests not only on powder and iron, but yet more on bread and beef. It may have been the German sausage by which France was beaten, quite as much as the German rifle. The food question in Europe may be one of possible revolution and repudiation of national debts, and of the disruption of nations as they now exist ; and to this branch of the victualing department atten- tion may well be called, because its conditions are so greatly in contrast to those of the United States ; but this phase of the question will be treated separately in a subsequent article. May we not find in these costly armies, excessive debts, and excessive taxes not only the cause of pauper wages, but also the cause of the ineffectual and costly quality of so-called " pauper labor " ? May there not also be found in these figures incentives to socialism, to communism, and to anarchy ? What hope for men and women, the whole of whose product would barely suffice for subsistence, when ten, twenty, and perhaps even thirty per cent, is diverted from their own use, and even food is denied them sufficient to maintain health and strength, in order that these great armies may be sustained ? The victualing department is therefore presented in these three phases : First. In our own country the only question is how to save the waste of our abundance, and how to teach not only the working people, but even the prosperous, the right methods of obtaining a good and wholesome subsistence at less cost in money than they now spend for a poor and dyspeptic one. Second. In Great Britain and Ireland the victualing department underlies a system of land tenure which is now on its trial, and which has led to such artificial conditions that great areas of good land have been thrown entirely out of cultivation, while half the people are being fed from fields from five thousand to fifteen thousand miles distant. Third. Upon the continent of Europe the victualing department stands face to face with a forced method of distributing and wasting a food-product which, as a whole, is insufficient to maintain the whole population in vigor and health even if it were evenly distributed, as food must be equally distributed by weight if not by quality, in order that men and women may be equally well nourished. When a famished democracy becomes conscious of its power, what will be the end of privileges which are not founded on rights, and of national debts which have been incurred by dynasties without the 4 50 The Industrial Progress of the Nation. consent of the people who are now oppressed by them ? How will standing armies be disbanded, which now seem to be as incapable of being sustained as they are impossible of being disarmed ? Such are some of the appalling questions to which we are led when we attempt to analyze the way in which men, women, and children now obtain the modicum of meat and bread which they must have every day in order to exist, and that daily ration of dairy products, of fruit, of sugar, and of spice, which is needed for common comfort. There is but one element of life which all have in common, and that is Time. Who can teach us how to use our time so as to obtain the substantially even weight of food which is necessary to the adequate nutrition and to the common welfare of rich and poor alike ? THE RELATIVE STRENGTH AND WEAKNESS OF NATIONS TWO STUDIES IN THE APPLICATION OF STATISTICS TO SOCIAL SCIENCE THE RELATIVE STRENGTH AND WEAKNESS OF NATIONS.' TWO STUDIES IN THE APPLICATION OF STATISTICS TO SOCIAL SCIENCE. I. STRENGTH. FROM one of the little-known but very remarkable financial essays of Pelatiah Webster, a patriot merchant of the era of the Revo- lution, who most urgently resisted the issue of the Continental currency, predicting all the malignant effects which ensued therefrom, we quote these words : " I conceive very clearly, that the riches of a nation do not consist in the abun- dance of money, but in number of people, in supplies and resources, in the necessaries and conveniences of life, in good laws, good public officers, in virtuous citizens, in strength and concord, in vs'isdom, in justice, in wise counsels and manly force." As the century is now just ended since the first steps were taken to frame the Constitution under which we live, it may be fitting to account to ourselves for the work which has been done during this hundred years in the land wherein we dwell. We may, perhaps, test the wisdom of our laws and the equity of our institutions by measuring the development of our resources, the abundance of our supplies, and the strength of our nation. Our na- tional domain is a trust with which we have been endowed. How have we discharged the trust ? The main source of all material life is land. The sea supplies food in small measure, but upon the land mankind almost wholly depends. May not that system of land-tenure and that form of government, therefore, be considered best which has resulted in the largest produc- tion and in the most equitable distribution of the products of the soil ? May we not claim this position among the nations ? Is not the only equitable distribution of the materials required for food a substantially even one by weight ? There may be a great differ- ' Reprinted with additions from The Century Magazine for January, 1S87. 53 54 The Industrial Progress of the Nation, ence in the quality, but the requirement for nutrition is the same among rich and poor alike ; each adult person should have substantially the same quantity of the chemical ingredients of food or " nutrients " by the conversion of which the body is sustained, and which are de- rived from animal and vegetable food. OUR NATIONAL DOMAIN, WHAT WE HAVE DONE WITH IT, AND WHAT WE MIGHT DO WITH IT. Section i. Arable Land — 1,500,000 Square Miles. IN ACTUAL USE. o 2 p c o O 8 8 o "O 8^ °, p o' 3 o ^ 8 S o II. III. IV. VI. 302,500 square miles now produce all our grain, hay, cotton, sugar, rice, and garden vegetables. Section 2. Pasture-Land. WHAT might suffice. (/ g 6 c V. >. t Q. £ •a d u 3 3 J3 3 M ^ I/) 8 8 8 % •0 .8 VII. VIII. IX. (A square mile = 640 acres.) Section 3. Mountain and Timber. Compiled from the records of the Agricultural Department and other sources, in November, 1886. There can neither be matured strength in the man nor in the na- tion without an adequate supply of food ; on the other hand, the very existence of the almshouse and the pauper asylum in civilized coun- tries bears witness to the admitted necessity of a substantially equal distribution of food by quantity or by weight. The Relative Strength and Weakness of Nations. 55 OUR NATIONAL DOMAIN.' GRAPHICAL PRESENTATION OF THE COMPARATIVE AREAS OF THE STATES AND TERRITORIES OF I UK UNITED STATES AND THE COUNTRIES OF EUROPE, OMITTING RUSSIA AND ALASKA. [Corrected from the revised computations of the United States Census of 1880, and the Statesman's Year Book of 1887.] Name. Sq. Miles 1. Texas -Ai.vfi 2. Austrian Empire . . . 240.91 ■ 3. German Empire . . . m.ui "4. France 2^)4.177 5. Spain i97.7<:'7 6. Sweden i70-9n 7. California 155.950 8. Dakota Territory . . 147. 7' o 9. Montana Territory . . i4S.3ic 10. Norway 123. 205 11. New Mexico Territory, 122.4(0 12. Great Britain & Ireland, 120.8^2 13. Italy 114.410 14. Arizona 112. 90 15. Nevada ioq.740 16. Colorado 103.645 17. Wyoming Territory . . 97.575 18. Oregon 94.5*° 19. Idaho Territory . . . 84.290 20. Utah Territory . . . 82,190 21. Kansas 81,700 22. Minnesota 79,205 23. Nebraska 76,183 24. Indian Territory . . . 69.830 25. Missouri 68,735 26. Washington Territory . 66.880 27. Turkey in Europe . . 63,850 28. Georgia 58.980 29. England and Wales . 58,186 30. Michigan 57.430 31. Illinois 56.000 32. Iowa 55--175 Wisconsin 54.450 Florida 54,250 Arkansas 53.045 Alabama 5''540 North Carolina . . . 48.580 Roumania 48.307 39. New York 47.620 40. Mississippi 46.340 41. Louisiana 43.420 42. Pennsylvania .... 44.985 43. Tennessee 4'. 75° 44. Ohio 40.760 45. Virginia 40,125 46. Kentucky 40.000 47. Portugal 36.°^8 48. Indiana 35.9'o 49. Ireland 3=o3i 30. South Carolina . . . 30,170 51. Maine 29,875 52. Scotland 29,820 53- Greece 25.014 54. West Virginia. . . . 24.645 55. Bulgaria 24.3^*9 56. Bosnia & Herzegovina, 23.570 57. Servia i8.8'?.3 38. Switzerland .... is.Sgj 59. Denmark 14.1-4 60. Eastern Roumelia . . 13.500 61. Netherlands .... 12,648 62. Belgium 11, 373 63. Maryland 9.S60 64. Vermont 9.135 65. New Hampshire . . . 9,005 66. Massachusetts .... 8,040 67. New Jersey 7-455 68. Connecticut 4.845 69. Montenegro 3.550 33- 34- 35- 36- 37- United States solid, Europe open. Relative Population of Countries at the Dates OF THE Last Census taken in Europe AND OF the United States.* • (At the date of the publication of this volume, in 1889, the population of the United States may be computed at somewhat over 63,000,000.) Russia 85,296.479 I Finland 2,176,421 ) »7.472.900 United States, July 4, 1887 . .60,000,000 German Empire . 46,852,450 70. Del.iware . . . . 71. Rhode Island . . . 72. Andorra 73. District of Columbia 74. Monaco 1,960 1.C85 175 \ 60 * 6 Austrian Empire . 37,882,712 37,672,048 36,325,115 29,361,032 Spain 16,961,742 ,987,040 France . . . Great Britain and Ireland . . . Italy Turkey in Europe . 4,668,000 ^l Bulgaria &E. Roumelia, 2, 982,949 >8,i " ■" ■" ' i) . 5.85.3278 Bosnia & Herzegovina 1,336,091; Belgium Roumania Sweden Netherlands . Portugal . . Switzerland . The visionary possibilities of the future product of the United States may be imagined by reference to the Denmark following statement : The land in actual use for growing maize or Indian corn, wheat, hay, oats, and cotton in the whole country Greece . . . now consists of 282,500 square miles, or a little more than the area of the single State of Texas. c The entire wheat crop of the United States could be ^^''■'^ • • " grown on wheat land of the best quality selected from that part of the area of the State of Texas by which that single j^orjvay . . State exceeds the present area of the German Empire. The cotton factories of the world now require about vi„ntenegro 12,000.000 bales of cotton of American weight. Good ^ land in Texas produces one bale to an acre. The world's supply of cotton could therefore be grown on less than . 19.000 square miles, or upon an area equal to only 7 per * Authority cent, of the area of Texas. . 5,376,000 , 4,682,763 . 4.336.012 • 4,306,554 . 2,846,102 . 1,980,253 , 1,979,561 I. 952.351 . 1,931,000 250,000 Almanach de Gotha, except where later fijfures are giveB in other compilations. » Reprinted front the Century Magazine for January^ 1887. 56 The Industrial Progress of the Nation. Raw land, if such an expression may be used, itself possesses no more value than free air or running water. A price may be paid, or a contest may be waged for a time, in order to secure the opportunity to reap and dispose of the harvests which are due to original fertility ; but, with very rare exception, the virgin properties of the soil are soon exhausted, and what is known as " economic rent " almost wholly dis- appears ; then land ceases to be a mine and becomes a laboratory, only yielding product, and therefore only yielding wages and profits, according to the measure of the labor put upon it, of the capital put into it, and the intelligence with which both capital and labor are di- rected. At last land may cease to yield either wages or profits in response to labor and capital unless both are combined under the direction of skill and experience. There is no absolute private ownership of land in this or in any other civilized country, yet limited possession is necessary to its use and to its production. When subject to such limited possession it be- comes useful and valuable. All systems of land-tenure which tend to limit or retard production, so that even a slowly increasing population gains upon the means of subsistence, may be rightly subject to change. Or if, after the prod- uct of the land has been made in sufficient measure for the welfare of the people who dwell upon it, it is then so wrongly distributed that a considerable part is wasted in the support of standing armies or dynas- tic privileges, while great numbers of people suffer from absolute want, it will only be a question of time when such forms, systems, or institu- tions must give place to others, either by peaceful evolution or by violent revolution. The purpose of these studies is to treat the present relative condi- tions of the so-called civilized nations of Europe, and to compare them with the conditions of the United States, in respect to the production and distribution of the means of subsistence which are wholly derived from land. It is proposed to apply the test of such a balancing of accounts as a business man is accustomed to call for when any corporate enterprise is subjected to his scrutiny. The work of States may be considered in the nature of a corporate enterprise subject to the control of the people who are members of the corporation, as they may choose to direct. At the same time, all such direction by statutes, and all customs which precede or attain the force of law, must be brought into harmo- ny with a true science of law if they are to be permanent, else they will only create confusion and become inoperative. It may be said that no true science of law has yet been established among men : then the The Relative Strength and Weakness of JVations. 5 7 POPULATION OF THE UNITED STATES, Either as Enumerated in the Census or as Computed BY Mr. E. B. Elliott, Actuary of the Treasury Department. 1861. .32,060,000 1862. .32, 704,000 '863.. 33,365,000 1S64.. 34,046, 000 1865. .34, 748,000 1866. .35,469,000 1867. .36,21 1,000 1868. .36,973, 000 1869.. 37, 756,000 1870.. 38,558,371 1871.. 39,555,000 1872. .40, 596,000 1873. .41,677,000 1874. .42, 796,000 When this article is published, the population of the United States will be substantially 60,000,- 000. If we omit Russia wholly from the compu- tation, the area of the re- mainder of Europe covers 1,500,000 square miles, of which the population is about 240,000,000 1875.. 43,951, 000 1876.. 45, 137,000 1877. .46,353,000 1878.-47,598,000 1879.. 48,866,000 1880.. 50, 155,783 1881.. 51, 495,000 1882.. 52, 802,000 1883.. 54, 165,000 1884.. 55,556,000 1885.. 56,975,000 1886.. 58,420,000 1887.. 59, 893,000 1888. .61, 394,000 1889.. 62,921, 000 1890.. 64,476,000 Enumerated. Computed. more reason to test the present condition of nations which claim to be governed by law, in order to determine by a comparison of their conditions which one has attained the best results, so that a basis may be laid for a true inductive science of law governing the social order, fully consistent with the higher law which governs the universe. As regards land, the continent of Europe and '• the territory of the United States are about even. The area of Europe, in- cluding all of Russia, is -^""^ '• 3,761,657 square miles. '86o..3i,443.32i The area of the United States, including Alaska, is 3,501,404. If we omit in Europe the uninhabitable portions of Norway, Sweden, and Russia, and if we omit Alaska from the territory of this country, we reach a substantially even pro- portion of habitable land, to wit, about 3,000,000 square miles in each country. The population of Eu- rope approximates 334,- Enumerated, Computed. Enumerated. -Computed. 58 The Industrial Progress of the Nation. II. MILES OF RAILWAY IN OPERATION IN THE UNITED STATES On the first of January in each year, begin- ning 1865. Compiled from Poor's Railway Manual. The average number of ■ men employed per mile of railway in the census year "* was a little under five. With ^___ the increase of traffic, it is doubtless a little over five ——-^ now. The executive force of all the railways therefore numbers about 650,000 men. The construction of railways in 1886 will probably exceed 6000 miles, at about $25,- 000 per mile, or at sixty men per mile, earning each an ^__ , average of a lit- tle over $400 — — therefore repre- senting a con- struction force of ■ — about 350,000. 1865.. 1866.. 1867.. 1868.. 1869.. 1870.. 1871.. 1872.. i373" 1874.. 1875.. 1876.. 1877- 1878.. 1879.-. 1880.. 33.9°8 35,085 36,801 39,250 42,229 46,844 52,914 60,293 66,171 70,278 72,383 74,096 76,808 79,089 81,776 86,497 1881.. 93,545 1882.. 103,334 1883. .114,925 1884.121,543 1885.. 125,379 1886.. 128,967 One million men are therefore occupied at this time either in the construction or operation of the rail- ways of the United States. 1885. Capital stock Funded debt Other debt Passenger receipts . Freight receipts Total, including miscellaneous $3,817,697,8^2 3,765,727,066 259,108,281 $200,883,911 519,690,992 765,310,419 The railway mileage Jan. i, 1881, was 93,545. In a treatise upon what would be an adequate service, written in that year, the writer said that 117,500 miles should be added in the next fifteen years ; but as we should have at least one commercial crisis and railway panic during that period, it might be safer to assign twenty years to the work. Since Jan. i, 1881, we have had both a crisis and a panic, but we have added 35,422 miles, leaving only 82,025 for the next eleven to fifteen years. The increase in the railway mileage of the United States subsequent to the publication of this article in The Century^ gives the following results, actual and estimated . MILES READY FOR OPERATION. Jan. I, 1887 " 1888 " 18- 1890 (Estimated) ».S7,987 149,913 156,613 164,000 III. CHARGE PER TON PER MILE For moving Merchandise over the New York Central and Hudson River Railroad, at THE average, in EACH OF THE SEV- ERAL YEARS DESIGNATED. 1855. .3.270 gold. 1865..3.451 paper 1866..3.092 " 1867. .2. 754 " 1868.. 2.742 " 1869. .2. 387 " 1870.. 1.853 " 1871. .1.649 1872. .1.592 1873.. 1. 573 1874.. 1. 462 " 1875.. 1876. 1877. 1878.. 1879.. 1.275 1. 05 1 1. 014 .930 •796 .879 .783 •738 .910 .830 .680 gold. The railway service of the United States for the last four years, 1882 to 1885 inclusive, on the au- thority of Poor's Railway Manual, has consisted in moving 1,597,058,562 tons of food, fibers, fabrics, tim- ber, metal, and fuel an av- erage distance of iii miles each ton, at a charge of $2,052,849,085. The average service for each man,woman,and child of the population has been in moving ^\ tons of food, fuel, and other necessaries of life III miles at a charge of $9.35 to each person per year, or a fraction over 2J cents a day. The New York Central and Hudson River Railroad may be taken as a good example of an important line of railway under most efficient management, and as a stand- ard of what other lines may accomplish when the magni- tude of their traffic will permit them to make as great a reduction in rates. The average charge per ton per mile on this line from 1865 to 1868, four years, was 3.0097 cents per ton per mile. From 1882 to 1885, four years, the charge was 07895. Difference, 2.2202 cents. If we may assume that the people of the United States have been saved two and one fifth cents per ton per mile on the whole railway traffic of the last four years, either by the construction of railways where none before existed or by such a reduction in the charge for their service, the amount or money's worth saved in four years has been $3,898,- 373,159, which sum would probably equal the cash cost of all the railways built in the United States since 1865, to which sum miijht probably be .added the entire payment upon the national debt since 1865. The following table brings into yet more conspicuous notice the beneficent effect of the railway system in the distribution of food : The Relative Sty^ength and Weakness of Nations. 59 C/3 Q I— ( > O < o is c a o '^ uj 00 N (U CO \n rh 00 H rj r^ 10 t-^ f= ''J- 00 no 10 rn vn 00 m -<*- r*. r^ VO On 10 in 10 r^ 00 \fi t^ m 0^00 mw ■^oooooo m m \n 00 CO O IT) t^ N •H in m o\ M 00 N M ^ fn 'i-\o o\r^Ooooo\oyD O CO M 00 VO so « 00 « o» ■* »n CO vO CO -<^ po mro*-* ino om n « nt^oo oo«oo 00 o 00 m S^ ro^■<^mm^ovo^o t^ flivo mn^iooo o-^'^t^ovoo ■^t-i'O ^'^^srN.oo o\oo ■*^s.o\ 2:\o 000 O'O t^oo >-«*o N^c o « N wO ■^vo r^'-cx) -^o ?■ M w r^roi^mM3 ■^■^t^t^N t^N m fOOoo o^mvo tnO\ eNro<^-f'-roM'«co t^NocT-^i^rCNvo M mfnooQ"\0 mo ovD t^"*oa\iofovocovo O o '-' t^mvo t-s-^o^tN. yjOoo mo O_inm»nc>*o_'0_'^rot^oo«0,oo'0iom'oc^ C ^^vo^tCaTofoiO'^ N N mroiooo'^tN.o^M w *inO Q MMMMMwMi-iNNNroromro^ H yj >- . . . - rt V > »n^o t^oo onO h n m^tn»o 1^00 onO •-< ci m^mvo t-«» vo^osovo^ t^ts.tN.i^tN.tN.t>.i>.t^r>.cooooococooooooo 00000000 OOOOOOOOOOOOOOCOOOOOOOOOOOOOOOOOOOOOOO 6o The Industrial Progress of the Nation. < £ o in O < o _) w Pi o W W W > o 3 rC 5 ^- " O fO lO N o O O O ro VO c?! in m M CO in ^ u-j ■^ CN M in M 00 vo a rOM CT>ON00 t^oo t^t^OO •}■ On O ^ t^ ^0 C^ r* 3 C C4 o o Ph J3 o •o > ■ o " ^1 S M o H ■O VCT ^O Co' (N '^ w f M r~^ n-j N m ^ « in oo 00^ 0\ -^ CO M^ a* in ■^ -^ m ■* »n CO O MD N CM t^ vo rn lO lO ro rn O CO O O m CO tA vo t^ 00 M 00 CO M^ N q ~ Tt- 00 vo r^ c^ O f^ 00 0^ 1-^ in ■^ in m "^ m vo vo vo M - 00 vo rs. CN m rn -^ m 0\ M m ro (^ Ov m tN. ov O >- c ^ o « ■* f^ o o »n o^ t-N. lO ■* vo w On ■**■ OO in ^^ 0\ VO vo vo M -^ tn r~^ o •-' M M M IH (N W 0\ rr, O VO N in in VO tj- lo li-) vo r^ M H vo oo vo vo Ov vo vo' Ov m VO 00 O w CI CO vo O O VO o vo in •^ ■+ in bs. vo oo CO w CO m M ".oo oo m n ro-^^nvo r*oo OvO w n ro-^mvo tN. vovovovovo t^i^r^r^t>.tN.tN.t>.rs.r^oooocooooocooooo oooooooooooooooooooocooooocooooooocxioooooooooo The Relative Strength and Weakness of Nations. 6 1 IV. GRAIN CROPS OF THE UNITED STATES. Maize or Indian Corn, Wheat, Rye, Barley, Oats, and Buckwheat. From the Reports of the United States Department of Agriculture. The population of the United States is now a fraction under twenty to the square mile ; while that of Europe, aside from Russia, is about i6o. But there are many portions of the eastern section of the country which are as densely populated as any of the European States, with the single exception of Belgium. The low cost of the railway service in the United States makes the distance between the farm and the factory of very little consequence so long as there are no artificial obstructions to commerce. The whole country is one great neighborhood in which each man serves the other; and this is its true strength. The wages for one day's work of an average mechanic in the far East will pay for moving a year's sub- sistence of bread and meat a thousand miles or more from the distant West. On the other hand Europe is filled with obstructions to commerce which are far more diffi- cult to surmount than that of distance. In other conditions aside from land there is a considerable similarity between this country and Europe. Until a very re- cent period more than one half the territory of Europe was still kept back in its progress by the serf- dom of the peasantry of Russia ; while nearly one half the territory of the United States which had been occupied before the opening of the Civil War was kept back in its mate- rial progress by slavery. Again, there is as great a difference in the rel- ative conditions of soil and climate, and in the physical conformation of the land — as great a differ- ence between the moun- tains and plains, of the United States, as there is in Europe. 1865 . • i,i27<499''87 1866. • 1,343,027,868 1867 . • i,329<929'40o 1868 . . 1,450,789,000 1869 . . 1,491,412,100 1870 . . 1,629,027,600 I87I . . 1,528,776,100 1872 . . 1,664,331,600 1873. . 1,538,892,891 1874. • Ii455ii8o,20o 1875. . 2,032,235,300 1876. . 1,962,821,600 1877. ■ 2,178,934.646 1878 . . 2,302,254,950 1879. • 2,434.884,541 1880 . . 2,448,079,181 I88I . . 2,066,029,570 1882 . • 2,699,394,496 1883 . . 2,623,319,089 1884. . 2,982,246,000 1885. . 3,014,063,984 The close coincidence between the increase in the miles of railway constructed and the bushels of grain produced will be observed. It may be held that by the constructioi* of railways in advance of the population a great rise in the value of fertile land in the East has been retarded and the increased product of the Western farmer has been rendered possible ; while under the land-grant system, land which might otherwise have been sold in large parcels has been broken up into small farms by the reservation of alternate sections. Under this influence, a superabundant supply of food has been produced by a less proportion of the population occupied in agriculture in 1885 than in 1865. The grain crops of the United States subsequent to the publication of this article have been : 1886 . 3,015,439,000 bushels 1887 . 2,649,613,000 ,, 1888 . 3,200,000,000 ,, estimated in part. If the early promise of the season of i88g is maintained, the crop of grain will be the largest ever grown, both absolutely and in ratio to population. 62 The Industrial Progress of the Nation. PRODUCT OF GRAIN PER CAPITA. And Ratio of the Increase of Grain to the Increase of Population. Bshls. Ratio to The relative differences in the conditions of the people of the several states of either continent must therefore be sought in some other cause than in the physical geography or the climatology of the two continents. Reference may perhaps be made to the difference in language and in creed in Europe. But it must be remembered that the settlers who have occupied the United States formerly differed as much as the people of Europe in these matters ; yet the common school of this country has proved, or is proving, to be the solvent of race, creed, language, color, and condition, and is rapidly merging the whole popu- lation, so far as the conditions of material welfare are concerned, into one single and substantial body-politic, as firmly bound together as if all the people had been strictly homogeneous. It is not, however, the purpose, nor would it be within the ability of the writer, to attempt any general treatment of the profound differ- y ences which have brought the greater part of continental Eu- rope either to actual or prospec- tive national bankruptcy, and in some places to such abject con- ditions of want as may perhaps account for the conditions of socialism, communism, nihilism, and anarchy. These phases of resistance to social order as now established may perhaps be deemed only the reflex or com- plement of despotism or of dy- nastic privileges, and of misap- plied and misdirected national greed as yet unenlightened as to what is the true source of the wealth of nations. The business man who at- tempts to comprehend the causes and effects of existing conditions may well leave the philosophy of the subject to the student and to the statesman ; but perhaps such a one can apply common busi- ness methods of account to the conditions of the present, and by sorting assets and liabilities and striking a trial balance of the accounts of the several civilized Date. per head. popu- lation. 1 86s • . 32.50 . . 1. 00 1866 . . 37.80 . . 1. 16 1867 . • 36.73 ■ . 1. 13 1868 . • 39-30 • . 1. 21 1869 . • 39-44 - . 1. 21 1870 . . 42.24 . - 1-3° 1871 . - 38-64 . . 1. 19 1872 . . 41.00 . 1.26 1873- • 36-90 . 1. 13 1874. • 34-00 . 1.05 1875 • . 46.19 . 1.42 1876. • 43-50 • 1-34 1877. . 47.00 • 1-44 1878 . ■ 48.37 • 1-49 1879. . 50.20 • 1-54 1880 . . 48.80 . 1.50 1881 . . 40.00 - 1-23 1882 . . 51.12 .,1-57 1883. . 48.40 • 1-49 1884 . - 53-68 .1.65 1885 . • 52-50 . 1.60 The increase in the per capita product of grain does not show as conspicuously on the chart as the absolute increase, but it gives even greater evidence of progress in common welfare. A less proportion of the population is now occupied in agriculture, and especially in the production of grain, than was re- quired at the beginning of this period, while the sub- stitution of machinery for the arduous handwork of a former day has greatly relieved the severity of the toil, and rendered the harvest much more certain. TJie Relative Strength mid Weakness of Nations. 63 states of the world, he may perhaps throw a little light upon problems which students and statesmen alike now seem to be incapable of solving. There can be no question that the 3,000,000 square miles of habit- able land in Europe, taken as a whole, could sustain in peace and plenty a very much larger population than now exists thereon, if the relations of the people among themselves were the same as the rela- tions of the people of the several States of this Union to each other. The potential of subsistence in Europe has not yet been approached. Again, if there were no greater obstruction to mutual service be- tween the people of Asia Minor and of North Africa, especially Egypt, than now exists or may soon exist between the United States and the Dominion of Canada, an absolute abundance of food, fibres, fuel, and materials for shelter, upon which material life and welfare depend, would be assured to as large a population in Europe as the absolute but visionary figures of our. census bring into prospective view upon this continent a century hence. If such are the natural conditions, then the social and political dif- lerences must be weighed in the trial balance of nations by their mate- rial results. We will set off democracy against dynasties in figures and by the facts of life. In the attempt to bring into comparison the absolute weakness of the states or nations of Europe whose chief strength is now assumed to be in their armies and navies, I have used tables showing the progress of the industries and arts upon which our own mate- rial welfare chiefly rests, dating from 1865 to 1885, inclusive. Several of these tables have been previously used in other publications, but they are now brought down to the latest dates and grouped together in such a way as to show their real significance. In Europe we find nine- teen separate and partly or wholly independent nations or states, nearly all governed by dynasties, with the excep- tion of Switzerland. Even VI. HAY CROP OF THE UNITED STATES. From the Statistics of the Department of Agriculture. Tons. 1865. • 23-538,740 1866. . 21,778,627 1867 . . 26,277,000 1868. . 26,141,900 1869 . . 26,420,000 1870 . . 24,525,000 I87I . ■ 22,239,400 1872 . . 23,812,800 1873. . 25,085,100 1874. • 24,133,900 1875 . . 27,873,600 1876. • 30,867, 100 1877. . 31,629,300 1878. . 39,608,296 1879. • 35,493i000 1880. • 31.925,233 I88I . . 35,135,064 1882. ■ 38,138,049 1883. . 46,864,009 1884. . 48,470,460 The hay crop at tlie farm is worth much more than the cotton crop at the factory. Food costs the average family three to four times as much as clothing. The combined value of the poultry and eggs only which are annually consumed is computed at $200,000,000. This is more than the value of the pro- duct of pig-iron, silver bullion, and the wool-clip combined. 64 The Industrial Progress of the Nation. VII. PRODUCT OF PIG-IRON IN THE UNITED STATES. Compiled from the Records of the Iron and Steel Association. Estimate of 1886, given by courtesy of the Secretary, Mr. James M. Swank. in republican states like France, the dynas- tic method has not yet been displaced by local self-government in any true sense of that term, while in Great Britain, which in some respects is more democratic than the United States, or is rapidly becoming so, a feudal practice of land- tenure remains in force and the paternal form of government yet dom- inates internal affairs, although it has been almost wholly thrown off in respect to for- eign commerce. This centralized system ap- pears to be now culmi- nating in the final strug- gle of the English Parliament to relieve itself of duties which Theascertained or estimated production of pig-iron subsequent to the publication of this article has been ; have become almost '^f • • 6,365,328 tons, 1887 . . 7,187,206 impossible, and to rele- '^^^ • • Z.-^^.^'5°7 ,". ,, ^ , ^ ' 1889 . . Estimated by Mr. Swank at about the same number of tons as in 1888. The production of pig-iron is an arduous and somewhat undesirable occupation, giving employ- ment at the present date, 18S9, in this country to about 150,000 men and boys. On the other hand, this relative consumption of iron and steel is one of our surest standards by which the progress of a nation in material welfare may be measured. The production of iron and steel in this country has not sufficed to meet the demands at several periods during the last twenty-five years when railway construction has been active — especially in the List decade. The production of pig-iron for the years 1879 to 1888 inclusive amounted to fifty-two and a quarter million tons of 2,000 lbs. each ; the consumption in the same period has been over sixty million tons, two thirds consumed in the form of iron, and one third in the form of steel. This con- sumption was equal to nearly thirty per cent, of the entire production of the world during this period, and in 1887 our consumption of 300 lbs. per capita was equal to nearly forty percent, of the production of the world. The prices of iron and steel have been steadily falling, subject to occasional upward fluctuations, since 1865, both in this and all other countries, and with the reduction the use of iron and steel for various purposes other than railway construction has steadily increased. While the absolute price has thus been reduced, the relative disparity or difference in price in the United States as compared to other countries has increased. From 1879 'o '888 inclusive, the relative difference paid by consumers in this country has averaged $7 per ton on iron and $7 per ton addi- tional on steel taking I'cssemer metal for comparison. The amount of this difference paid by con- sumers here as compared to consumers in Great Britain has amounted to $420,000,000 on 60,000,000 tons iron, with $140,000,000 added at $7 per ton on 20,000,000 tons converted into steel, making $560,000,000 in all. It is therefore not surprising that the import of machinery and other fabrics of metal should be increasing. The effect of our tariff has doubtless been to increase our actual prod- uct and perhaps to have hastened the general reiluction in price both here and elsewhere, but the cost of this method of promoting the production of iron and steel has averaged $56,000,000 a year for ten years, making the total above given, which sum amounts to more than the entire capital now invested in all the iron mines, blast furnaces, steel works, and rolling mills now in existence in this country. Whether this method of promoting the domestic production of iron and steel has been worth what it has cost is a question which must soon be considered. Tons of 2,000 lbs. 1865 • 9311582 1866 ■ '. 350.343 1867 . 1,461,626 1868 . 1,603,000 1869 . 1,916,641 1870 . 1,865,000 1871 . 1,911,608 1872 . 2,854,558 1873 . 2,868,278 1874 . 2,689,413 1875 . 2,266,581 1876 • 2,093,236 1877 • 2,314,585 1878 • 2,577,361 1879. . 3,070.875 1880 • 4,295,414 1881 . . 4,641,564 1882 . . 5,178,122 1883 • 5,146,972 1884 • 4,589,613 1885 . • 4.529,869 1886 . . 5,600,000 estimated The Relative Strength a7id lVeak?iess of Natwtis. 65 COTTON CRC Bales 1865-66 . . 2,228,987 186&-67 . • 2,0591271 1867-68 . . 2,498.898 1868-69 . . 2,439,039 1869-70 . • 3.154.946 1870-71 . • 4.352.317 1871-72 . • 2,974.351 1872-73 . 3.930,508 1873-74 ■ • 4.170,388 1874-75 . • 3.832.991 1875-76 . . 4,669.288 1876-77 . . 4,485,423 ,877-78 . . 4,811,000 1878-79 . • 5.073.531 1879-80 . ■ 5.757.397 1880-81 . . 6,589,329 1881-82 . • 5.435.84s 1882-83 . . 6,992,234 1883-84 . ■ 5.714.052 1884-85 . . 5,669,021 1885-86 . • 6,550,215 1841-1861 inclusive 93.389,031 58,441.906 VIII. OF THE UNITED STATES. gate to the people not only of Ireland, but of England, Scotland, and Wales as well, the functions of home-rule, of self-government, and the charge of their own local affairs. Members of Parliament appear to have at length discovered that the lesser details of local affairs are entirely beyond the power even of a rep- resentative but single and centralized Parliament, al- though such Parliament may be nominally su- preme. One can more readily comprehend the present condition of Great Britain and Ireland by im- agining the deadlock which would arise in this coun- try if it were necessary to apply to Congress for an act to construct water or sewage works for the ser- vice of each town or city in Massachusetts or any other State, or to build a railroad in any part of the country. In the United States, on the other hand, we find thirty-eight interdependent States to which others may soon be added, in each of which local self-govern- ment in the strictest sense is absolutely assured by the support of the central sustaining power of the nation. We have neither the weakness of the cen- 21 crops made by free labor. 21 crops made by slave labor. 21 excess by free labor. 34,947,125 The average weight, per bale, has also steadily increased. The value of 35,000,000 bales of cotton produced by free l.ibor in excess of the product of slave labor cannot have been less than $2,000,000,000 or about the full valuation of all the slaves who were made free by the war. This gain is due not only to the freedom given to the blacks, but to the emancipation of the white men of the South from the indignity of enforced idleness. The cotton crops of the United States subsequent to the pablicatiorl of this article have been : 1886-87 . . . 6,513,623 bales 1887-88 . . . 7,017,707 " 1888-89 • estimated 7,100,000 " To the value of the cotton crop may now be added the utilization of the cotton seed and its conversion' into oil, food for cattle, and other purposes. Under the old system of slave labor the cotton seed was nearly all wasted : yet such was its known theoretical value to those who had made a complete study of the plant, as to have justified the writer in staling in a treatise on " Cheap Cotton by Free Labor, ' printed in 1861, that if there were a variety of the cotton plant which could have been grown in the Northern States producing only seed but no lint, it would long before have become one of the valuable crops of free labor. 5 66 The Industrial Progress of the Nation. IX. PROGRESS IN WEALTH. Computations of wealth, such as are given in the census, are not of much value. Progress in wealth can, perhapSj be measured as accurately by the amount of insurance against loss by fire as by any other standard. The following table, compiled by Mr. C. C. Hine, editor of the Insurance Monitor^ of New York, gives the amount of risks taken by all the fire insurance companies which are licensed to transact business in the State of New York. In the judgment of Mr. Hine, about ninety per cent, of all the insurance taken in the United States is covered by the companies which make an annual report of their whole busi- ness in the United States to the Insurance Commissioner of this State. The effect of the war may be traced by the apparent reduc- tion of risks during the period in which business intercourse with the Southern States was interrupted. Year. Risks taken. Proportion. tralized nation nor that of the separate petty states ; but under our system we have the united power of a body of English-speaking people outnumbering all the English-speaking peo- ple of Great Britain and her colonies combined. In the town-meeting of New England, and of some of the Western States which were settled by her children, and in somewhat less degree in the county divisions of other States, we find an absolute dem- ocracy guarding its own local affairs with a jeal- ousy of centralized power which is sometimes even too urgently expressed. Each little community is, perhaps, more self-govern- ing and self-sustaining un- der the protection, first of the State and next of the Nation, than any whichever before existed in any civil- ized state, or in any period of time since the Norsemen clashed their shields in the meetings of the freemen, from whom so much of our liberty has been derived. Insurance risks reported to the Commissioner of the State of New York subsequently : 1886 . . . $11,349,685,459 1888 . ._ . 13,093,938,785 1887 . . . 12,230,325,078 1889 . Estimated 13,800,000,000 There are no absolute data for computing the risks which are not reported to the Commissioner ■of the State of New York. The Factory Mutual Companies of New England cover a little less than $500,000,000, and by comparison with the census of 1880 the local fire companies which do not transact any business in the State of New York cover about $700,000,000 more, making a total of poli- cies now in force of about $15,000,000,000. This is a large and perhaps incomprehensible sum, but as the population must now be over 63,- 000,000, it gives an average per capita of only $238. 'J'he experience of insurance companies warrants an estimate that the amount of insurance car- ried corresponds to about two thirds the value of property that might be consumed. On this basis the average capital of the community which is subject to loss by fire amounts to about $360 per head. If foundations, railway tracks, and other forms of capital which cannot be burned amount to one third the amount subject to loss by fire, then the actual capital may be $480 to $500 per head; this sum reached by a wholly different process of computation, very fairly sustaining the estimates of the census of 1880, which came to $870 per head, including land, and less than $500 aside from the valuation of land. It also sustains the estimates of economists and statisticians, that the capital of the richest community seldom or never exceeds the value of two or three years' production, which I have elsewhere computed at not over $200 per head in 1880. 1859 • • 1,498,569,125 i860 . 1,345,004,487 I86I . 1,258,972,728 1862 . 1,3731766,641 1863 . 1,612,361,852 1864 . 2,223,833,544 186s . 2,564,112,505 1866 . 2,945,381,297 1867 . 3,165,666,666 1868 . 3,420,490,029 1869 . 3,778,713,296 1870 . 4,035,907,596 1871 . 3,987,386,026 1872 . 4,529,668,173 1873 • 5,783,777,818 1874 . 5,889,403,314 1875 • ■ 6,039,507,339 1876 . 5,914,565,904 1877 . 6,008,976,461 1878 . . 6,229,312,193 1879 . • 6,673,099,069 1880 . • 7,184,511,455 1881 . • 7,949,581,516 1882 . • 8,534,253,737 1883 . • 9,359,423,527 1884 . • 9,736,329,252 1885 . ■ 10,517,940,175 The Relative Strejigih and Weakness of Nations. 67 What would have been our condition had the Potomac become the Rhine, dividing two nominally independent states or communities, or had the country beyond the Mississippi remained under the dominion of a foreign nation ? We may answer this question by referring to the facts. The nine- teen indepe?ideiit states of Europe, whether empires, kingdoms, duke- doms, or republics, require a standing army of over four million men in the aggregate, constantly under arms, to guard the frontiers and to maintain the so-called balance of power. About ten million more men are held in reserve who have already wasted the best and most pro- ductive part of their lives in preparing for, or in active war. The thirty-eight interdependent States of this country require a standing army of only 25,000 men, serving mostly as a border police, and also forming a nucleus around which freemen may gather at a day's warning, to be formed into an army with which it would be use- less for any foreign or domestic disturbers of the peace to attempt to cope. To what do we owe this immunity from force ? Is it not mainly because we have almost learned the open secret that in all commerce, whether between states or with other nations, each man serves the other, and that the gain of each is the gain of all ? Was there any more potent influence by which the people were in- duced to surrender their carefully guarded separate existence under the confederate form of government which preceded the adoption of the Constitution, than the difficulties and dangers to the Union, which occurred during the Revolution itself, and also in the short period from 1783 to 1787, growing out of the separate attempts to control not only the trade with foreign countries, but of the several States each with the other, by separate laws and regulations ? Were not the prime causes of the war of the Revolution itself and the separation of the colonies of America and Great Britain strictly commercial in their character ? The resistance to the stamp tax was but the final pretext. The real grievances had existed for a long period, and they consisted in the attempt of England to prevent the manufacture of iron and steel in the colonies, and to repress textile manufactures, which were rapidly becoming established. To this end repressive laws were passed, commerce between the several colonies was restricted or forbidden, and the navigation acts, passed at the instance of the Long Parliament in a vain attempt to destroy the free commerce of the Dutch, were revived in an equally futile attempt to restrict the growing commerce of the colonies, especially with the West Indies and the Spanish Main. John Hancock had himself been one of the great smugglers of his day. It remained for the Congress of the United States to do what Great Britain failed to ac- 68 The Industrial Progress of the Nation. compHsh. By means of the same navigation acts, modeled on those of Cromwell's time (known as the 12th of Charles II.), applied to our own people, we have substantially succeeded in driving our own flag from the ocean. Whatever may now be the difference of opinion among men of affairs in this country in regard to the conditions by which foreign commerce shall be conducted, there is but one common judgment as to the vastly greater commerce which exists among ourselves. No one now questions that the stability of this nation and its exemption from the necessity of a large permanent armament have been more fully assured by the single provision of our organic law which forbids any interference with commerce between the several States, than by any other law or custom which exists among us. Had it not been for this absolute freedom of domestic trade, we might have repeated the blun- ders of European states, and we might now be in almost as desperate a condition as many of them are in. It will be in no boastful spirit that some of the material results of a century of the constitutional history of this country will now be given and the balance struck with other states or nations. It is only since the passive war of slavery culminated in the active war by which it destroyed itself, that a citizen of the United States could face the English-speaking people of other lands without a blush of shame. It is only in the last twenty-one years, or since slavery finally surrendered The following Recapitulation is substituted for one which was given in the original article ; it is brought down to a later date. Percentage of Gain in Population, Production, Wealth, and Savings, 1870 to 1885, and on Some Items to 1886. To 885. Population 48 885. Production of grain 85 885. Consumption of cotton . . 86 885. Consumption of wool ... 88 885. Production of hay 100 885. Deposits in savings-banks of Massachusetts 102 885. Production of cotton .... 108 886. Deposits in savings-banks of Massachusetts 115 885. Production of iron 143 885. Insurance of property against loss by fire .... 160 885. Miles of railroad 168 886. Miles of railroad 192 886. Production of iron 200 In considering these relative gains it will be observed th.it they represent a constant gain in the means of subsistence over population ; that with the exception of the increase in personal wealth, which is indicated by tho increase 111 the amount of property insured against loss by fire, they represent the progress of the million in the means of common welfare rather than of the millionaire in personal wealth, and that they give testimony to the beneficent law of progress yV-ow poverty. The Relative Strength and Weakness of Nations. 69 XI. LIFE INSURANCE. Compiled by Mr. C. C. Hine, Editor of the " Insurance Monitor," of New York. There are now twenty-nine solvent and prosperous life in- surance companies in the United States, of which nineteen were in existence in 1865. Between these two dates others have become insolvent. The data below show the progress of the existing companies by a comparison of their risks in force in each year. at Richmond, that local self-government has had any existence over the southern half of our country. The Southern States have gained in tJieir defeat tJie ve?y end for which t/iey rebelled ; and they have now discovered for t/iemselves that local self-government can only exist in any true sense where the equal rig /its of all men are respect- ed^ and when sustained by the power of a great nation. There has been not only such a revolution of institutions but of ideas in the Southern States, that ,865. . . 507,285,914 it would take a larger 1866. . . 731,373,332 Northern army to re-im- 1867. . . 947,676.897 pose the burden of slavery ises. . .1,217,729,344 upon them than it did to issg. . .1,353.585,723 remove it. The growing 1870. . .1,441,334,237 prosperity born of liberty '871. . .1,451,410,487 is now so fully assured 1872. . .1,542.015,515 that the very " rebel brig- '873. • .1,602,394.973 adiers " have become most '^74- ■ .1,609,841,449 loyal citizens and safe leg- '^^s- • .1,603.464,680 islators ; yet less than a generation has passed since all this was accom- plished. All that we can therefore claim is that we have just begun to com- prehend the problem of common welfare, while we admit that we have yet much to learn. It will be apparent, from the consideration of the quality and kind of products of which the increase lias been so very great during the last twenty-five years, that the gain has been mainly in the products which are of common consumption by the great mass of the people— food, metals, and fibres. This great additional supply of materials of common consumption, or which are used in the processes of do- mestic industry, either directly or when exchanged for foreign imports for similar use, must have been mainly consumed by the great mass of the people, because the small number of the rich, and the somewh.-it larger number of the well-off who cannot be called rich, were already able to provide them- selves wiih all that they could possibly require of such nrticles as wheat, corn, cotton, iron, wot>l, and the like. Hence it follows of necessity that the additional product must have been consumed in such a way as to add greatly to the material welfare of the great masses of the people. Under such conditions one would rightly expect the result to be a prolongation of life ; a more ample supply of food and clothing, better shelter, easier methods of distribution, coupled with great progress in sani- tary science would of necessity tend to an increase in the duration of life. This expectation h. as been realized. [Through the courtesy of Mr. William P. Stewart, one of the most experienced actuaries in the country, I am permitted to print a table (page 70) which he has lately prepared, showing the actual and possible curves of life, giving scientific proof of progressive increase in the duration of human life.] Had it not been for this increase in the duration of life, it might have happened that life-insurance companies would have suffered from the reduction in the rate of interest which they are now obliged to accept on their investments in consequence of the rapid accumulation of capital ; but it will be very plain that if, coincidently with the reduction in the rate of income upon investments, the duration of life insurtd is being prolonged, then policies issued on existing tables might be even safer than they were under former conditions, while it may soon happen that the rates of premium which are now estab- lished may be computed on new tables computed at lowerrates. 1876. . .1,573,972-605 1877. . .1,496,596,847 1878. . .1,429,506,323 1879. . .1,422,817,588 1880. . .1,464,250.018 1881. . .1,539,846,581 1882. . .1.637.582,773 1883. . .1,763,730,015 1884. . .1.870,745,521 1885. . .2,023,517,488 yo ^ The Indiistrial Progress of the Nation. P^ O rt H w H W H w < fc l-H 1— I hJ > ei :d Uh M o P5 ^ S ^ ^ c/) 7, W > P^ >< m D Q c; < ^ D 8 H o" U o < z o Q M H s CO < Pi O w Z >■' < U «>; < z o xn en W fa o Pi fa E-- P5 H l-H Q H t/2 1-1 < The Relative Strength and Weakness of Nations. 7 1 Short as has been the period since we first began to reap the harvest of true liberty, yet cannot the words DISARM OR STARVE be read between the lines or underneath the figures of the balance-sheet of nations which is now submitted ? When government by force of arms meets the competition of a free peo- ple governed by their own consent, in the great commerce of the world, what chance of success can there be on the part of states into the cost of whose product is charged the blood-tax of huge standing armies and of war-debts, or upon whom a war-tax presses which takes from a product that would barely suffice for a meagre subsistence so much that many are already starving or only eking out a feeble life on pauper wages ? ' I have endeavored to put into the form of what may be called a visible speech the results of the comparisons which I have made in regard to the relative weakness and strength of this and of other nations,^ from the standpoint simply of a man of affairs engaged in the daily work of life. I have taken the year 1865 as the starting-point. It is sometimes held, and perhaps with truth, that in the very struggles which ensued between the dates 1861 and 1865, in the effort to eliminate from our organic law the elements of injustice and wrong by which it had been perverted, that the imagination of the people of both sections was first aroused and their knowledge of each other was greatly extended. A knowledge of the vast extent of the land and its resources also became common to all. Thus great enterprises became possible which might otherwise have been deferred for half a century or more. The great railroad constructor, the manufacturer, and the merchant of to-day engage in affairs as an ordinary matter of business, which to their predecessors, or even to themselves in their early manhood, would have been deemed impossible of accomplishment in a whole lifetime. Before the war, one line of railway to the Pacific was the vision of a half-cracked enthusiast ; ' When the people of this country shall learn the simple lesson that in all commerce between men or nations, both parties gain, or else the commerce ceases ; and that high wages in money or what money will buy are the necessary correlative or consequence of low cost of production, then may we expect to see a great commercial union or sys- tem of free trade among the English-speaking people of the world, against which no army-ridden nation can hope to compete. Then the vision of Richard Cobden, the calico printer, and of John Bright, the cotton-spinner, will become living truths, and the law of mutual service will overcome the disorder of mutual strife, while the weak- ness of great armies will compel armed states and nations to disband them. Until this simple lesson is learned, the people of the United States will fail in their claim to be great among nations, however great in their own domain, and their influence for right will be impaired by their intellectual and political mediocrity. ''■ The substance of this article was first submitted in the form of an address to the Amer- ican Association for the Advancement of Science, at the meeting of 1886, held in Buffalo. The Industrial Progress of the Nation. to-day the opening of a fifth or sixth line would call only for a descrip- tive paragraph in a newspaper. ^^'- In the table on page Wages, per Day, of CARPErixERS, Painters, Machinists, . Blacksmiths, Cabinet-makers, and Others in Similar ^4 the proportions of ar- OCCUPATIONS. Comparisons of wages at different dates and in different places able, paStUre, and mOUn- are apt to be fallacious, because of the difference in conditions ; . • 1 1 j r 1 therefore certain specific leading establishments have been taken tain OX timber land Of thC as a standard, where the work has been continuous. Thestatis- -rr ■ j r' • j tics were obtained by the Massachusetts Bureau of Labor United btateS IS repeated Statistics, in part from the books of the employers and in part from the accounts of workmen. Table I. — Workmen 0/ average capacity , per day. i860 186s 1870 1872 1878 1881 t86o 1865 1870 1872 1878 188 1 1885 Relativ (iROSV Gold . Paper Gold . . . $1.68 2.285 1.824 1-375 1. 714 2.18 2.04 Table II.- . Gold . Paper Workmen 0/ superior skill., per day. ,2.37 Gold 2-75 2.25 1.87 2.12 3.00 3.00 e Purchasing Power of One Dollar of Lawful Money at Diffekent Dates, as Compiled by Mr. Wm M. from the January Century as the preface to the subse- quent tables. Much of the pasture land may yet be converted into most productive arable land by irrigation ; while the mountain and timber land is permeated by a great number of fertile valleys. Subsections I. to VI., inclusive, show the abso- lute use of land for our present grain, vegetable, and cotton crops, upon which we now produce grain enough for 80,000,- 000, and cotton enough I'ENOR BY THE TaBUL.'^TION OF THE PRICES OF TwO for 250,000,000 pCOplC Of Hundred Articles, Comprising Nearly Every Commodity IN Common Use, One Dollar of Gold being taken as a Standard in i860, Represented by a Purchasing Power OF 100. One dollar, lawful money, i860 May I, 1865 56.84 1870 75.47 1872 74.45 1878 118.76 1881 102.97 1885 Average, year 1885 123.63 126.44 more. Sub-sections VII.,VIII., and IX., if they were cul- tivated by well-known methods of intensive farming, would suffice for a larger product of beef, wool, and mutton, and of milk, butter, and cheese, than is now enjoyed by the present population, even at a more wasteful and lavish mode of subsist- ence than is nowpractised. Wages of mechanics in Massachusetts having been twenty-five per cent, more in 1885 than in i860, while the purchasing power of money was twenty-six per cent, greater, the workman could either raise his standard of living, or on the same standard could save one third of his wages. In a subsequent chapter reprinted under the title of " Low Prices, High Wages, Small Profits — What Makes Them ? " — comparisons are given class by class, compiled from more adequate data, more than sustaining the combined effect of the lower prices and of wages both higher in rate and in pur- chasing power upon the welfare of the great mass of the people. The Relative Strength and Weakness of Natiojis. 73 In tables subsequent to the first I have given the statistics of the increase of cotton, of the railway mileage, and of the products which lie at the foundation of all material welfare. The tables printed in connection with this article give conclusive testimony to the enormous growth in wealth of the United States since the end or even during the civil war. It is admitted, however, that growth in wealth may not be synonymous with growth in general wel- fare. Absolute proof of the latter, statistical especially, is a matter of great difficulty to the economist and the statistician. For the present I can only refer to the following table No. XIII., in which the increase of deposits in the savings-banks of Massachusetts is given, and also the increase in the purchasing power of a dollar, as shown in table XII. This subject will be treated more at length in a future article. In the judgment of the Commissioner of Savings-Banks, and of many others who are competent to form an opinion, at least three fourths of the present deposits in these banks belong to those who are strictly of the working classes, xiii. in the limited sense in Deposits in the Savings-Banks of Massachusetts. which those whose daily work is neces- sary to their daily bread make use of that term. This sys- tem of savings-banks, managed by unpaid trustees without ex- pectation of personal profit to any stock- holder or individual, or to any one except the depositors and the relatively small exec- utive force required, is practically limited to New England and the Middle States. The total sum on de- posit in all those States is now com- puted at $1,100,000,- 000, at an average of $356 to each deposi- tor. If the system were 865. . 59,936,482 866. . 67,732,264 867. . 80,431,583 :868. . 94,838,336 869. .112,119,016 870. .135,745.097 871. .163,704,077 872. .184.797,313 :873. .202,195,343 874. .217,452,120 875. .237,848,963 876. .243,342,642 877. .244.596,614 878. .209 860,631 879. .206,378,709 880. .218,047,922 ;i. .230,444,479 a. .241,311,362 883. .252,607,593 884. .262,720,146 885. .274,998,412 Population, 1865 1,267.329 Number of deposit accounts , 2yi,488 Average deposit, each account 8205.62 Average deposit per head of population 847.29 Population, 1885 1,941,465 Number of deposit accounts 848,787 Average deposit, each account $233.99 Average deposit per head of population $141.64 If the savings-bank deposit of the whole population of the United States were now equal per capita to that of Massachusetts, the sum of such deposits would be over $8,400,000,000. 74 The Indtistrial Progress of the Nation. extended throughout the country, and the deposit per capita of the peo- ple of the United States were equal to that of Massachusetts, the total sum would amount to somewhat over $8,400,000,000. Another fact may be cited which fairly sustains the general state- ment that those who do the actual work of production are now secur- ing to their own use a larger share than ever before of the joint product of labor and capital. The earning power of $100 in gold coin invested in United States bonds of the best class was, at the highest point of paper-money infla- tion in 1864, i6j%% per cent, per year. At the present time the earn- ing power of $100 in gold goin invested in 4^^ per cent. United States bonds is only 2^jj% per cent, per year.' While the power of capital to secure income merely as capital has thus been diminished, the wages of by far the larger part of all the me- chanics, operatives, domestic servants, and the like, are now as high or higher in gold coin than they were in paper money at the highest point which wages or earnings reached in the paper-money inflation period of 1864 to 1867. See table XII. By the use of this extremely valuable table of the prices of 200 commodities, constituting almost every thing necessary to subsistence, compiled by Mr. Wm. M. Grosvenor, of New York, it appears that if the purchasing power of one dollar in gold coin, on May i, i860, be taken as the standard, or one hundred cents' worth, the corresponding purchasing power of one dollar of lawful money on May i, 1865, at a period of great paper inflation, was S^t%^o cents' worth of the same commodities. On May 1, 1872, in the year preceding the financial collapse of 1873, the pur- chasing power of a paper dollar was less than seventy-five cents' worth. At the present time, and at present prices, the gold dollar will buy twenty-six per cent, more than in i860. That is to say, wages are now as high or higher than they were from 1865 to 1872 in paper, and much higher than they were in i860 in gold : they are now paid in gold coin or its equivalent. This gold coin will buy the commodities which are necessary to subsistence, in the ratio of 126 units now relatively to 75 units in 1872, and to 57I units in 1865, or to 100 units in i860. Wages have increased absolutely and relatively, while profits have decreased relatively in much greater proportion. It is made apparent that the increased abundance derived from our fields, forests, factories, and mines must have been mostly consumed by those who performed the actual work, or who belonged to the ' The fact that the city of New York has, during the present year 1889, negotiated a loan for park purposes, on untaxable bonds, payable in forty but redeemable after twenty years, at two and one half per cent, per annum, the loan having been placed at a fraction above par, may go far to prove that capital is now accumulating in this country even faster than the general intelligence of the people, which is necessary to its productive use. The Relative Strength and Wcahiess of Nations. 75 working classes in the sense in which those who work for wages for small salaries or on small farms choose to construe that term, because they constitute so large a proportion — substantially about ninety per cent. — of the whole number of persons by whom such products are consumed. The greatest increased production has been in substances which are mainly used by the masses of the people. Articles of food necessary to life have increased more than the luxuries consumed by the rich. Hence no other evidence is needed to prove that the working men and women, in the strictest meaning of those words, are, decade by decade, securing to their own use and enjoyment an increasing share of a steadily increasing product. The labor question, as it is called, therefore consists in determining the conditions of the distribution of that greater proportion which is consumed by those who do the physical work of production. Invention creates opportunity for skill, and hence skilled workmen who do not bind themselves to work at the same rates of wages as those who are less skilful and less industrious, are steadily rising, so that there may now be greater disparity between the conditions of skilled and common laborers than ever before. While the great products of the United States have thus increased, in the same period the burden of the public debt of the nation has been steadily reduced. The books of the Treasury never showed the maximum debt ; but in his last report as Secretary of the Treasury, the Honorable Hugh McCulloch added the debt which was due August I, 1865, but which had not been audited and entered, to the debt then recorded, showing that the maximum debt was but a fraction under $3,000,000,000. Our ability to reestablish the specie standard of value has rested mainly upon our power to produce a great excess of food, cotton, oil and other commodities, which we have been able to export in e.xchange for our foreign purchases, while retaining our production of gold and adding thereto in the full measure necessary for our purpose. A review of the traffic of the last five years will show the relative importance of our foreign commerce. In the five fiscal years ending June 30, 1881 to 1885, inclusive, the exports of domestic products, consisting in much the greater proportion of the products of agriculture, have been valued at the port of export at $3,873,057,515, an average of $774,611,503 each year. At the average of $200 worth of product per capita of the popu- lation, or at $600 worth of product to each person occupied in gainful work, mental, mechanical, manufacturing, or distributive, this export represents the result of the work of 1,129,019 farmers, mechanics, factory operatives, railway employees, merchants, and others, in each 76 The Industrial Progress of the Natio7u year. So large a part of these exports, however, consisted of cotton and other farm products, that the average of $600 product per man is too high ; $500 per hand would be a large estimate, at which rate our average export for five years would represent the product of 1,549,223 persons, and even that estimate is probably too small. Except for this foreign demand for the excess of our food, of our cotton, of our oil, of our dairy products, and the like, they might have rotted upon the field or remained unused because they were the excess over our own lavish and wasteful consumption. In exchange for these products of our own fields, mines, and fac- tories, we have imported $3,314,818,061 worth of the necessaries, comforts, and luxuries of life ; the balance of the traffic, including the profits of our export trade, having come back to us almost wholly in gold coin or bullion. Possessing, as we do, an almost paramount control of the most available supply of food and cotton, which Europe must have or starve, we hold a demand check upon every bank in Europe for the coin or bullion on which we maintain the specie standard of value, which is so essential to prosperity. The commodities imported in the five fiscal years ending June 30, t88i to 1885, inclusive, have been classified in the National Bureau of Statistics as follows : A. Articles of food and live animals $1,079,869,829.00 B. Articles in a crude condition which enter into the processes of domestic industry 720,826,681.00 C. Articles wholly or partially manufactured, for use as materials in manufacturing and mechanic arts 390,102,678.00 $2,190,799,188.00 D. Articles manufactured ready for consumption $718,300,081.00 E. Articles of voluntary use, luxuries, etc 405,718,792.00 $1,124,018,873.00 Total 3,314,818,061.00 Free of duty $1,024,385,175.00 Subject to duty 2,290,432,886.00 Duties paid thereon 986,002,925.00 Export per capita $17.52 Imports " " 15-04 Except for this export our excess of grain and cotton could have little or no present use, and therefore no value ; what we import we could not pay for except with grain, cotton, oil, etc. The whole value of our imports, therefore, becomes the secondary product of our own labor, and the sum of such imports is so much added to the fund from which wages, profits, and taxes are alike derived. In the use of the imports which enter into the processes of our The Relative Strength and Weakness of Nations. 7 7 domestic industry and are thereby converted into domestic manu- factures, another great bpdy of industrious working men and women have been occupied. Although the domestic commerce of this and of every other civilized nation is vastly greater in volume and value than its foreign com- merce, yet the latter serves as a balance-wheel to the whole. The interdependence of nations thus asserts itself : the wider the com- merce or mutual service, the greater the result of the labor applied, the lower the proportionate cost, and the higher the rates both of profits and wages, which are alike derived from the final sale of all products, whether the money distributed comes from the sale of the primary products of strictly domestic industry or from the secondary products imported in exchange for the excess of the first. Thus far it has been easy to prove the enormous growth of the productive power and wealth in this country. We have gained in "number of people, in supplies and resources, in the necessaries and conveniences of life " ; have we made equal progress " in good laws, good public officers, in virtuous citizens, in strength and concord, in wisdom, in justice, in wise counsels, and manly force " ? If we have not, then " Of what avail the plough and sail, Or land or life, if freedom fail?" May not this vast gain in the conditions of material welfare in the United States be mainly attributed to the following elements in our national life ? First. The free purchase and sale of land, and the stability which ensues from the fact that so large and constantly increasing proportion of the people actually possess land. Second. Absolute freedom of exchange among the several States. Third. The system of common schools which is now extending throughout the land. FourtJi. The protection which the possession of the right to vote gives to the humblest citizen, both white and black. FiftJi. Local self-government in the strictest sense, in the manage- ment of local affairs. SixtJi. General laws in most of the States enabling cities and towns to provide water and sewage without special acts of legislation, and also enabling corporations to be formed for the construction of railways, so that no monopoly of the mechanism of exchange can exist. SeventJi. The habit of combination and organization engendered by long practice, to the end that if any thousand persons, with perhaps the present exception of the lately enfranchised blacks, were suddenly removed to some far distant place, away from their fellow-men, the 78 TJie Industrial Progress of the Nation. men of adult age would immediately organize an open meeting, choose a moderator, supervisor, or mayor, elect a- board of selectmen, of THE PRICE OF LIBERTY.— THE PUBLIC DEBT OF THE UNITED STATES. Per Cap. Reduction debt per capita. i860 .... July I $59,964,402 1. 91 1861 .... " 87,718,660 2.74 1862 .... " 505.312,752 15-45 1863 .... " 1,111,350,737 33.31 1864 .... " 1,709,452,277 50.21 1865 .... " 2,674,815,856 76.98 1865 * . . . Aug. 31 .... 2,997,386,203 84.00 1866 .... July I 2,636,036,163 74.32 1867 .... " 2,508,151,211 69.26 1868 .... " 2,480,853,413 67.10 1869 .... " 2,432,771,873 64.43 1870 .... " 2,331,169,956 60.46 1871 .... " 2,246,994,068 56.81 1872 .... " 2,149,780,530 52.96 1873 .... " 2,105,462,060 50.52 1874 .... " 2,104,149,153 49.17 187s .... " 2,090,041,170 47.56 1876 .... " 2,060,925,340 45.66 1877 .... " 2,019,275,431 43.56 1878 .... " 1,999,382,280 42.01 1879 .... " 1,996,414,905 40.86 1880 .... " 1,919,326,747 38.27 1881 .... " 1,819,650,154 35.36 1882 .... " 1,675,023,474 31.72 1883 .... " 1,538,781,825 28.41 1884 .... " 1,438,542,995 25.80 1885 .... " 1,375.352,443 2409 1886 .... Oct. I 1,367,549,567 23.00 1886 "... " 1,274,728,153 21.60 Total .... $2,997,386,203 ' According to the old form, corresponding to the form in use 1865-85 inclusive, which does not include the bonds advanced to the Pacific Railroad Company to be paid by them. The first statement for October 1, 1886, includes these bonds and excludes the value of subsidiary silver coin from assets. At the date when ^^^ this treatise is being proposed for repub- lication the net debt — ^ of the United States of all kinds, includ- ing the bonds ad- ""■ vanced to th e Pacific Railroad, is less a than $1,100,000,000. On the 1st July, 1889, a further re- duction will have been made, and, omitting the bonds advanced to the Pacific Railroad, the net debt will be a lit tie less than $1,000,- 000,000, and the population will then be 63,000,000, giving a ratio of debt to population of less than §16 per head — a reduction of seventy-five per cent, since Aug. 1 , 1865. It now seems probable that as the people have not yet decided in what manner the national rev- 1 Debt audited and en- tered on the 31st of August, 1865, being the highest record . $2,756,431,571 Added for debt due but not then audited . 240,954,632 The Relative Strength and Weakness of Nations. 79 assessors of taxes, and a school committee, appoint one or two con- stables, and then, adopting the principle of the English common law, would at once undertake their customary gainful occupations. These factors in the life of a free people are not named in the order of their relative importance, but are given in a list, each relative to the other, and, as a whole, composing the main elements of our social organism. There may be a fallacy in the old democratic dogma that " the government is best which governs least," but there is no fallacy when it is put in another form : That country will prosper most which requires least from its government, and in which the people, after having chosen their officers, straightway proceed to govern themselves according to their common habit. In the conclusion of this branch of the study of the facts and figures of this country, may it not be held that the alternate periods of activity and depression which have affected the industries of this country since the end of the civil war, have been mere fluctuations or ebbs and flows in the great rising tide of material progress, ending in an adjustment to ever new and better conditions of life ? Is it not true that while the rich may have become relatively no poorer, the poor have been steadily growing richer, not so much in the accumulation of personal wealth as in the power of commanding the service of capital in ever-increasing measure at a less proportionate charge ? Can it be denied that labor as distinguished from capital has been and is secu- ring to its own use an increasing share of an increasing product, or its equivalent in money ? enue is to be reduced, and since the Congress, which will hold its first session in 1889, will probably prove to be wholly incapable of dealing with the question, the excess of revenue above authorized expendi- ture may go on at the rate of about two dollars per capita for about four years more, in which period, under such conditions, the debt will be reduced to a fraction over $500,000,000, and may be wholly paid in one generation from the date when it reached the maximum. The cost, measured in money, of removing the compromise with slavery from the Constitution of the United States, was as follows : The national revenue collected from April i, 1861, to June 30, 1868— four years of war and three of reconstruction under military rule — was : From taxation and miscellaneous receipts • $2i2i3i349>486 From loans which had not been paid June 30, 1868 2,485,000.000 Total §4,696,349,486 The peace expenditure would not have been over 698,349,486 Cost of the war $4,000,000,000 » To the computed cost of the war— $4,000,000,000 — must be added by estimate the war expenditures of the Northern States and the value of the time, materials, and destruction of property in the South- ern States, together probably amounting to a sum equal to that spent by the National Government. The price of Liberty in money has therefore been $8,000,000,000. This comes to $1,135,000,000 per year for a little over seven years. The productive capacity of an average man is now about $600 worth per year. If it was then $500 worth, this sum represents the work of 2,270,000 men for seven years ; at $400 each, 2,837,500 men. The average population during this period was 35,000,000. If we assume one in five an adult man capable of bearing arms, there were 7,000,000, of whom one third paid the price of liberty in work for seven years, or in life. _ ... In an address given in Georgia a few years since, the writer ventured to predict that a time would come when the children of Confederate soldiers would erect a monument to John Brown in commemo- ration of the liberty which he brought to the white men as well as to the black men of the South. Has it not come? THE RELATIVE STRENGTH AND NATIONS.' WEAKNESS OF NATIONAL DEBTS— PER CAPITA. United States, National t . . $23 United States, including State debts - 27 Germany, including King- doms and Duchies ^ . 39 TWO STUDIES IN THE APPLICATION OF STATISTICS TO SOCIAL SCIENCE. II. WEAKNESS. HAVING analyzed the strength of Democracy in America we may now turn our attention to the other side, and consider the sources of the weakness of nations which are governed by dynasties. In Professor J. R. See- lye's recent book upon the expansion of Engand, he has traced nearly all the Europe- an wars of recent times to the struggle of nations for do-, minion over other continents or parts of continents, in or- der to establish colonies and to control commerce there- with ; commerce itself hav- ing been regarded by almost all nations, and being now regarded by the greater num- ber, as a quasi war in which what one nation gains an- other must lose. This fallacy has led to very many of the great actual wars of the last century and a half, and the vast national debts of Europe have been incurred in this futile and foolish attempt to set up as a rule among nations : " Let him take who has the power. And let him keep who can." Afagazine for February, 1887. Belgium ' 78 Italy 80 Holland 115 France ^ 124 Great Britain 127 ' July, 1889. Less than $16. 2 July, 1889. Less than $20. It may be claimed that the debts of the several States constituting the United States should be added to the national debt. I n 1880 the total amount of such debts was $226,507,594, since which date they have been diminished by large pay- ments in many Stales. The present debt of all the States is not in excess of $4.00 per capita of the whole population. The data for computing departnent, county , city, town, and communal debts are not within the reach of the writer | but as these debts have been mostly incurred for public improvements, both in Europe and in this country, they do not come into the same category — debts of nations mainly incurred in war or in preparation for war. ' It should be stated that a considerable part of the debt of Germany and I'.elgium and a small part of that of France, was incurred in the construction of railroads, but most of these railroads have been constructed for military purposes. ' Reprinted with additions from T/ir Century 80 The Relative Strength and Weakness of Nations. 8 r The business man who fully comprehends the function of the mer- chant and of the manufacturer, and the place which commerce holds in the beneficent progress of the world, may well covet the genius of Southey in order that he might add new verses to the " Devil's Walk " as he passes in review the great wars which have been fought to gain the control of commerce which could have been had for the asking, and which would then have yielded a vastly greater benefit to both parties than either could gain by attempting to get an advantage over the other. What more fruitful subject for the satirist than the bluster of the party politician at the present time, whose zeal is apparently in inverse proportion to his sincerity, in regard to the respective claims of this country and of Canada over the right to fish within a certain distance from the coast, when it would benefit both countries to put the regula- tion of all the fisheries under a joint control, so that both might be far better served with fish than either can now be ? ' What greater economic blunder has ever been committed than the support of slavery in this country for nearly a century of its history ? It was the most costly and least productive system of labor, brutalizing to the black man and debasing to the white man ; yet it was justified ' Since this article was written, the fishery treaty negotiated by the late adminis- tration of President Cleveland, under the direction of the Secretary of State, Thomas F. Bayard, has failed of ratification in a Senate controlled by the opposition party. A more discreditable debate may never have occurred in the history of this country. In it the true point at issue was obscured by a mass of historic rubbish and misrepresenta- tion, especially on the part of New England. If salt cod and smoked herring were not taxed in the sum of $350,000 to $400,000 when imported from Canada, there would be no cause of dispute on the so-called fishery question. This tax is imposed upon a necessary article of food at the instance of the owners of fishing vessels, on the pre- tence that American seamen are trained for the navy in sailing these vessels — the fact being that at least three fourths of those who man the fishermen are foreigners, mostly natives of the maritime provinces of Canada. When the record of history is made in regard to this matter, it may be written that a cause of quarrel with Canada was main- tained for many years in order to collect a tax on a necessary article of food, which cost more for the administration of the customs service, the naval protection of the fishermen, and in the waste of time in the discussion in Congress, than the whole rev- enue derived from the tax. This tax was supported by the votes of those who were induced to pervert a public trust to purposes of private gain through false representa- tions made to legislators whose integrity can only be justified at the cost of their intel- lectual capacity to comprehend the true limits of public taxation. A tax which could not be justified for purposes of revenue, and which failed even in its ostensible object of giving more employment to American seamen in the fishing vessels, could therefore only have been maintained by a great and powerful nation out of petty jealousy and pusil- lanimous fear lest the progress of our poorer neighbors, in their attempt to serve us while gaining a living in an arduous and dangerous calling, should harm us in some way which no Senator proved to be capable of defining in the whole progress of the debate on the treaty. 6 82 The Industrial Progress of the Nation. by men of such intelligence and force that had it not been for the narrowing influence and the bitter apparent necessity imposed upon them to sustain a crime against humanity, they might have left a repu- tation as statesmen. What more ludicrous commentary upon the intellectual mediocrity of legislators than the demand lately presented in Congress by the representatives of one of the New England States for a heavier duty upon sugar when imported in bags rather than in boxes, in order that the Cuban planters might be compelled to buy the decreasing timber supply of the forests of Maine in the form of sugar-boxes, and charge it back to all consumers of sugar in this country as a part of the cost of imported sugar. Could there be a more complete reductio ad absurdum than the con- clusion to which the late Henry C. Carey was led by his lack of true insight in respect to the functions of commerce, namely, " that the material prosperity of this country would be more fully promoted by a ten-years' war with Great Britain than it could be in any other way" ? (I quote this from memory ; the statement was made in a conversa- tion to which I listened.) Yet out of this very jealousy of nations we gained almost without cost one of our most important possessions. One of the most singular of the incidents of one of these great European contests was the sale of the Louisiana territory to this coun- try by the First Napoleon, who, being unable to keep it, chose that England should not possess it. In a few short weeks this territory might have come under the dominion of England. One's imagination can hardly grasp the changed conditions of the world as they would have been had Great Britain succeeded in getting and keeping the con- trol of all that vast territory west of the Mississippi River which was comprised in this purchase, thus confining the United States substan- tially to what lies east of this mighty river. It is a singular fact that there appears to be no historical school atlas in use in this country in which the several additions to the terri- tory of the United States are pictured and described ; hence very few persons realize the vast importance and extent of the Louisiana pur- chase, or know the true conditions of the great contest with the slave power over the extension of slavery into what was known in 1830 as the Territory of Missouri, which comprised a vast area outside the limits of the present State of Missouri. While modern European wars have thus become a struggle for the control of commerce, or for the control of vast areas of territory in the attempt to secure its commercet o single states, war itself has also been mainly sustained by what may be called commercial methods — that is to say, the rulers of nations have made use of bankers, through whom The Relative Strength and Weakness of Nations. 83 they have pledged the national credit in order to support dynasties or to secure power to them. Even success in war has in later years de- pended as much upon the commissariat, or upon the business depart- ment of war, as upon the actual battles, or even more. This possibility of mortgaging the future by incurring a national debt has finally become the chief cause of the weakness of nations. The same century that has witnessed the increase of European national debts from a little over $2,600,000,000 to more than $22,000,000,000 has also seen Spain, Portugal, Austria, and Greece become bankrupt, while Russia is without credit. The attempt to enforce the payment of the bonded debt of Egypt by the force of armies at the instance of foreign creditors may be held to be a disgrace to the nations that have engaged in the undertaking. The debt was incurred without the con- sent of the people, and even the interest cannot now be met without taking so large a share of the meagre product of the fellaheen as almost to reduce them to starvation. Before the century ends we may even witness a general repudiation of these national mortgag- es, which the dynasties of Relative burden of national taxation the past have imposed upon the people of the present without their con- sent, and in almost all cases to their injury rather than to their benefit. In order that the rela- tive weakness of Europe caused by the burden of debts and of standing ar- mies may be fully com- prehended, the following statements are submitted : The debt of the United States at its highest point, in 1865, was eighty-four dollars per head, which is now the average debt of the commercial and man- ufacturing states of Eu- rope specifically named in the ensuing statement. The debt of the United States is now less than twenty-three dollars per Per capita of the principal commercial or manu facturing states of Europe which are solvent, and of the United States (omit- ting local taxation for departments, counties, cities, or for town purposes) : United States, not including payment upon the public debt, less than $4-50 United States, including payment on the debt, not over 6.00 Italy 10.42 Holland 10.90 Belgium Great Britain 11.80 Germany 12.00 France, by taxation .... 18.00 France, including annual deficit, over 19.00 The true burden of taxation may not be measured even by the proportion which the taxes of one country bear to another. The measure of importance is what ratio do they bear to the productive capacity of each nation or state, and for what are they expended. These matters are treated in a subsequent table. 84 TJie Industrial Progress of the Natio7t. ACRES PER HEAD OF POPULATION AND DEBT PER ACRE. United States (omitting Alaska), acres 32.7 head (or including all State debts, less than twenty-seven dollars). The national debt — now twenty-three dollars — will probably all be paid within one generation from the date when it was incurred.' In the consideration of these various tables it must be borne in mind that the annual pro- duct of a nation or state is the source of all wages^ taxes, rents, and profits^ and that by so much as one element of these charges upon the annual product is greater must some other element be less. No scientific meth- od has yet been invented by which taxes can be made to stay where they are first imposed. As a rule, taxation tends to dif- fuse itself over all con- sumption, and cannot be drawn in any large meas- ure from what would otherwise be rent or profit. Hence, when the product is small, the necessary cor- relative of high taxation is a low rate of wages or earnings. Therefore, low wages in Continental Eu- Great Britain, Germany, France, Italy, Holland, and Belgium, acres . . National debt of the United States (omitting Alaska) per acre . . . $00.73 National debt of Great Britain, France, Ger- many, Italy, Holland, and Belgium, per acre, $30.06 The proportion of men under arms in the commercial and manufacturing states of Great Britain, France, Germany, Italy, Holland, and Belgium is 2.200.431. The cost of sus- taining these forces in the last fiscal year was §493.505.520, or at the rate of S223 per man. The force which is actually under arms, aside from the re- serves, is at the r.itio of one man to each 200 acres ; and the annual tax for his support aver.iges gi.io per acre. The average cost per man in the army and navy of the United States, including the cost of ships, fortifications, navy- yards, and all other w.ir expenses, is about $i.£oo annually per man. The ratio is one man under arms to each 51,000 acres, and the annual tax for his support and for all other military purposes is a fraction over three cents per acre. ' Since this computation was made tlie reduction of debt has continued, and the amount of the national debt is now (May i, 18S9) $1,101,605,428. There are some compensations even for political incapacity. The Congress elected in 1888 may prove more incapable of dealing with the subject of taxation than the one whose term expired March 4, 1889 ; therefore, the .surplus revenue, which can only be expended for the reduction of debt, may continue to fall into the Treasury in an in- creasing measure. The actual burden of taxation by which the surplus is collected would not be any great matter, except for the bad methods and inconsistent laws under which it is collected. In the interval before the Congress which will be elected in i8go is called upon to treat the subject, great progress will have been made in the education of the people upon the whole subject of taxation, — then legislation may become jjossible under which even the present revenues may continue to be collected, but in such a way that the re- mainder of the debt may be paid in a very short time, without any undue interference with the freely chosen pursuits of the people, whether they engage in agriculture, manufactures, or commerce. The Relative Strength and Weakness of Nations. 85 Tope give no evidence of low cost of production, but rather indicate that the laborer is deprived of a large and undue share of his product by excessive taxation, chiefly for the destructive purposes of war or of preparation of war. The debt of all Europe in 18S4 and 1SS5 was $22,158,000,000 Population 334,000,000 Debt of the principal solvent and commercial states of Europe — Great Britain, France, Germany, Netherlands, and Italy $13,269,447,000 Population at last census I57.549i8i7 Debt of the United States at its maximum, August i, 1865, liquidated and unliquidated, as computed by Hon. Hugh McCulloch, Secretary of Treasury $2,997,386,203 Population 34, 748,000 Debt of the United States, August i, 1886 $1,380,087,279 Population as computed by E. B. Elliott, Actuary of the Treasury, August I, 1886 58,670,000 These figures of almost inconceivable millions convey but little idea to any one who is not accustomed to such comparisons ; it is only by considering them in relation to each person of the population, that the true measure begins to be defined. In the accompanying tables will be found statements of the debt per capita, the annual taxation per capita, the debt per acre, and also the proportion which the present standing armies bear to the population and to the men of arms-bearing age. Thus far all the facts which have been given have been taken from the " Financial Reform Almanac " of 1886, from the " Statesmen's Year- Book " of 1886, and from the official documents of the United States. I may now enter upon that part of my treatise which rests upon es- timates only. These estimates must be accepted for what they are worth. It is admitted that they are somewhat hopothetical. Are they sustained by facts ? The true income of a nation is not the money by which it is meas- ured ; it is, in fact, the product of its labor and capital, consisting of the materials for food, for clothing, for shelter, fuel, metals, and the like, converted and reconverted until ready for consumption. These products are measured in money's worth in the process of exchange, and it is important when making use of terms of money to carry with the measure of money the conception of the quantities of substance which money will buy, or which are exchanged for money. In a very few cases certain countries, like England, possess an income from foreign investments of capital previously saved ; but this is a very small element as compared to the value of its annual product. In the following tables this increase of income from foreign invest- ments has been considered with respect to the average value of the product per capita assigned to England. 86 The Industrial Progress of the Nation. STANDING ARMIES AND NAVIES OF EUROPE AND THE UNITED STATES, Compared in ratio to the number of men of arms-bearing age, assuming one in five of the population to be of that age. Standing armies of Europe in actual service 3.854,752 Men in the navies 268,622 Total armed force 4,123,374 Reserves ready for service at call 10,398,163 Proportion of men of arms-bearing age in the standing armies and navies, not including reserves. Exetnpis. I have attempted to establish a comparison of the product, per capita, of European countries, as compared to this country, at its measure in money. The known factors in the problem are, first, the relative rates of wages paid in the several countries considered, each as compared to the other ; second, the relative amount of national taxation per capita. Another factor which may be deemed to be sufficiently well estab- lished for purposes of comparison is the value of the per capita annual product of the peo- ple of the United States, estimated at two hundred dol- lars' worth to each person. The family group Total 14,521,537 in this country con- Substantially one in five of all men of arms-bearing age. sistS of a fraction over five persons ; the proportion who 15.13 were occupied for g gain was one in 2.90 in the census year, and may be comput- ed as one in three at the present time. 18.50 Two hundred dol- 22. lars' worth per head 24.40 would make the 25. average product of each person work- ing for gain six hun- dred dollars' worth of product per year. The writer has himself devoted a great deal of exami- nation to this sub- ject, and his esti- 81 of population, mate of two hundred dollars' worth per Proportion to total. All Europe i Italy I Holland i France i Russia I Germany i Belgium i Austria i . Great Britain i United States i Exempts. 16.13 7.50 13- 17- 19.50 23- 25.40 26. 322. 16. 321. Men in active service in armies and navies, omitting reserves: Russia . . 1,004,507 Belgium . 46,539 Italy . . . 765,820 Sweden . 43.174 France . . . 575.959 Denmark. 37,725 Germany . . 462,678 Greece . 33,187 Austria . . . 298,501 Portugal . 29,920 Great Britain . 281,746 Norway . 22,250 1 urlcey . . . 180,404 Roumania 20.572 Spain . . 1 16,256 Servia . . 13,079 Switzerland 113.368 Holland . . 77,689 4,123,374 or I man in 81 Reser> 'es . . . . 10,129,541 14,252,915 or I 24 United States. • • . • 36,294 or 1 ' 1610 Since this guarded computation was made, the armies of Europe have been increased, and it has been, computed that one man in sixteen upon the continent is either under arms or held subject to arm at the call of the government. The actual force in the standing armies now exceeds the number given in the table after deducting a part of the force assigned thereto in Italy and the whole of the armed freemen of Switzerland. The Relative Strength and IVeahiess of Natioiis. 87 head has been sustained by many other experts, official and unofficial. Accepting this measure as approximately true to the facts, it is held that the value of the product, per capita, of other countries may be based upon the value of the per capita product of this country, since the product of other countries must bear substantially the same proportion to the rates of wages and the per capita tax of such country as the product of this country bears to these known factors. In all the principal commercial and manufacturing countries of Europe and in the United States there is now such an amount of avail- able accumulated capital, as to make it certain that if there is any art or industry in which a rate or profit ranging from five per cent, to fifteen per cent, can be obtained, that branch of work will be quickly and surely undertaken. Hence it follows that if the sum of the wages at the current rate pre- vailing in each country can be ascertained, as well as the per capita taxes, we may ascertain the average value of the product of such labor by adding to these elements of cost from five per cent, to fifteen per cent, as the corresponding profit. In other words, there must be a necessary relation in the ratios which profits, wages, and taxes bear to each other in each commercial or manufacturing country, according to the respective conditions of industry in that country. For example, assuming that one person sustains two others in France as well as in this country, we know first that the average wages in France are not more than sixty per cent, the rate of wages in this country. We also know that national taxes are eighteen dollars per head in France and less than five dollars here. We need therefore only to establish the rate of profit which will induce the employment of capital in the arts which can be established in France in order to reach an. approximate estimate of the average value of the product of each person employed in productive industry. We may take as a class any group of skilled mechanics or artisans in the United States who earn two dollars a day or six hundred dollars a year, each one supporting two other persons. Their net wages each, free of national taxes, would be $585 Their proportion of national taxes for three persons at $5 per capita 15 Wages and taxes $600 Now if any one can make ten per cent, upon this sum, capital will be found for the employment of such men, and their product will be sold at such ten per cent, advance, if no more can be had, or at six hundred and sixty dollars. This would make the final value of the product of such a workman six hundred and sixty dollars : divided into profits, sixty dollars ; taxes, fifteen dollars ; net wages, five hundred and eighty-five dollars. 88 TJie Industrial Progress of the N^ation. } We know that the corresponding rate of wages of a French artisan would not exceed, on the average, sixty per cent., or three hundred and sixty dollars, and that the proportion of national taxes due from him and his two dependants would be fifty-four dollars. But the gross product of France being less than it is in this country, it may require a larger proportion of the product to be assigned to profits ; we will, therefore, call it fifteen per cent, on three hundred and sixty dollars, which is fifty-four dollars. This sum added to wages and taxes gives a gross value of the French workman's product, four hundred and four- teen dollars. The ratio in this comparison would be : Product, per workman, United States $660 " " " France 414 " " capita, United States 220 " " France 138 On the other hand, if the average annual product is only one hun- dred and thirty-eight dollars' worth per head, or four hundred and four- teen dollars' worth for the earnings of one of a group of three by whom the two others are sustained, the reason is not that the work is not equal, but that the quantity of the product to each person is limited by the conditions under which the Avork is done. The same workman when removed to the United States may produce twice as much as in France with the same labor, if he can adjust himself to his new condi- tions. The German immigrant actually does so. Does it not follow that wages are the reflex or result of the labor of the workman derived from the sale of the product after profits and taxes have been set apart ? Hence all attempts to compare the cost of production of any article by comparing the rates of wages must be entirely fallacious unless all the conditions of production are the same. The rates of farm wages are, on the average, four to five dollars per month with board, in Rhenish Prussia ; in the United States they are four to six times as much, but the money cost of producing a bushel of wheat in Prussia is double the cost in many parts of the West, where machinery is used to an extent unknown in Prussia, and almost impossible on account of the very minute subdivision of the land. The causes of the variation of the product per workman and per iiapita are, of course, manifold. The principal causes must be variation in : :• First. The natural resources of the country. Second. The efficiency of the workman in respect to mental training and manual or technical dexterity. ;• • Third. The efficiency of the tools or machinery used. Fourth. The full or deficient nutrition of the body. The Relative Strength and Weakness of Nations. 89 Fifth. The freedom from obstruction in exchanging the surplus of one art or industry for what is deficient in another, either one part with another in the same country, or one country with another. Upon this theory I have constructed the foregoing table, to which reference may be made, and while no claim for positive accuracy in the money estimates can be made for it, it may perhaps be accepted as relatively or proportionately correct. The facts sustain these propor- tions, and therefore prove the theory to be correct. Is it not also a matter of common observation that in a country like the United States, in which laborers are perfectly free, the transfer of land and of other property very easy and very promptly made, the use of machinery fully comprehended, and in which any new inventions speedily adopted, the product will be large in ratio to the number of persons employed ? Conversely, if the natural resources of a country are not large in ratio to the population, the transfer of land complex and difficult, ma- chinery inadequate, and improved tools not readily accepted, then the product will be small in ratio to the number of laborers. It follows that if taxation takes a large share of such small product, wages must be very low, and subsistence must be very meagre. In this country all conditions are favorable to low cost of produc- tion, low prices, and high wages, and therefore conducive to a widely extended commerce. Labor is effective, capital ample, and the aver- age burden of national taxation very light. The prices of our great staple products, such as grain, wool, and cotton, are practically deter- mined by competition in the markets of the v/orld. From fifteen per cent, to twenty per cent, of the product of agriculture of the United States finds its market in foreign countries. Therefore the price of all products of agriculture is determined by the price which the surplus will bring for export. Agriculture represents the largest single industry ; and the product being very large in ratio to the number of men employed, because of the fertility of the soil and the use of machinery, it follows that when the low rate of taxes has been set aside and the ratio of profit has been assigned which is required in order that capital may be invested in agriculture, the rates of wages or the earning of farmers in this country are, relatively to other countries, very high. Under such conditions large earnings and high wages are the necessary correlative of the very low cost of the production of the staples of agriculture. One is the reflex of the other. Up to this time the conditions of and the wages in all other arts in the United States have been practically determined by reference to the condition of and wages in agriculture. All other arts which have been undertaken in this country are therefore governed by corresponding go The Indush'ial Progress of the Nation. rules ; namely, by the application of machinery under the best condi- tions, the largest product is assured with the least expenditure of labor. Therefore in all arts, with few exceptions, after the low rate of taxation and suc?i profit as is necessary to induce the investment of capital have been set aside, the general rate of wages has been very high, be- cause the general cost of production has been low. The same rule, therefore, applies in all arts — that high wages or earnings are the reflex or complement of the large product, so long as labor and capital are left free to work together, and are not subjected to excessive taxa- tion. Hence no comparison of cost can be made by a comparison of wages unless all other conditions are identical. This fact was very clearly seen by the late Secretary Frelinghuysen, and his successor, Secretary Bayard, begins his instructions to consuls in these terms : " ' There are certain natural and artificial conditions which so largely affect the direct conditions of wages as to be entitled to consideration in any analytical examination of the great question of labor. ... It would be a legitimate field of inquiry to ascertain what are the conditions which enable England to manufacture machinery and other products at less prices than similar goods can be manufac- tured in France, and at prices equal to those in Germany, while the rates of wages paid to workmen engaged in such manufactories in England are, on the whole, higher than those paid for similar labor in France, and, as a foregoing table shows, more than double those paid in Germany.' " It is the wish of the State Department to pursue this inquiry in the direction indicated in this paragraph, and for this purpose the fol- lowing general instructions are given to consuls, reference being made to the specific forms of interrogatory appended hereto, or which will be sent hereafter." This apparent paradox of high wages and low cost becomes very simple when applied by any employer to his own experience. In a dull time, when it becomes necessary to discharge a part of the working force, which are the operatives first discharged ? Are they not those whose wages or earnings have been lowest — not those who have pre- viously earned the most for themselves ? Are not the men who earn the most for themselves retained because they are the most effective workmen, and therefore most capable of producing goods at the lowest cost ? Conversely, does not the fact which is apparently lost sight of by the proposed " organizers of labor " represent an absolute principle, namely, that the strong, industrious, and well-nourished manual laborer, or the skilful artisan or factory operative, will be substantially sure of continuous employment at the highest possible rates of wages when the less able or competent can find no steady occupation ? Is not the rule of universal application in civilized countries that there must be a certain ratio between the sum of the wages and the The Relative Strength and Weakness of Nations. 9 1 taxes combined, and the profit which may be derived from the several arts and industries of each of the several countries ? It has been admitted that in very poor countries where hand labor prevails in greater measure than the application of machinery, and where the taxes are very heavy while the product is very small, the ratio of profit must bear a larger proportion to the entire product than it does in a rich country where machinery is most fully applied and where taxes are low. In making the computations of the relative per capita product of the different countries, I have not attempted to cover this variation in the rate of profit, but I assume that, on the whole, any art in which capital can secure ten per cent, profit will be surely undertaken either in the United States or in England, France, Germany, and the Nether- lands. Perhaps not in Italy without a higher rate of profit. Upon this theory, and assuming that the product per capita of the United States may be valued at two hundred dollars' worth ; that of England, with its income from foreign investments added, may not exceed one hundred and seventy-five dollars' worth ; that of Great Britain and Ireland combined may be assumed not to exceed one hundred and fifty dollars' worth ; that of France as not exceeding one hundred and twenty dollars' worth ; that of Germany as not exceeding one hundred dollars' worth ; that of Italy as not exceeding eighty dollars' worth ; such being substantially the ratios which the average rates of wages with the per capita national taxation added bear to each other, and to the wages and taxes of the United States, with corres- ponding profits added in each case. In order that this proposition may be made more clear, the table on page 92 is submitted in which the line representing the product of each country is divided off into sections : in the sections on the right will be found the national taxation per capita ; on the left, the value of what remains for distribution as wages, profits, and for municipal taxes. In the same table will be found the percentage which national taxes bear to the assumed per capita product. In considering these remainders after national taxes have been set off, it must be borne in mind that municipal taxation as well as profits doubtless take a larger proportion in the poorer countries than in the richer ones. Hence that part of the product which may be assigned as the wages or earnings of the working people becomes less and less in proportion to the whole product, as the product itself dimin- ishes in quantity and in value. " For he that hath, to him shall be given : and he that hath not, from him shall be taken even that which he hath." These figures correspond to known facts. In Italy, which is rel- atively under a heavier burden of armies and taxes than any one of the 92 The Industrial Progress of the Nation. countries treated, what is left to the workman, either of his own product or what he can buy with his wages, now appears to be insufficient to RELATIVE PROPORTION OF THE ASSUMED PRODUCT PER CAPITA WHICH IS ABSORBED BY NATIONAL TAXATION ONLY, ON THE BASIS OF PREVIOUS COMPUTATIONS. The proportion divided off at the end represents national taxation. The remainder is what is left to be applied to local taxation, rent, profits, earn- ings, and wages. United States, product estimated $200 per capita. 195. England, product estimated $175 per capita. 165-167 3 Great Britain and Ireland, product estimated $150 per capita. 10-12J I !8-i40 France, product estimated $120 per capita. 5-20 I Germany, product estimated $100 per capita. 88^2 3 Italy, product estimated $80 per capita. 68 70 On revising these articles in April, 1 889, for republication in book form, I find no reason to make any material change in the figures of this table. Investigations which have been made in France have proved that the average rate of taxation given for each state was substan- tially correct, but fur- ther investigations in respect to the value of the product per capita in European countries would lead me to re- duce the figures of production, except in England. Since the publication of this article the burden of European armies and debts has gone on in- creasing, and the ten- dency to revolution and repudiation becomes more manifest as time goes on. Objection has been taken to these comparisons upon the ground that taxation for local and municipal expenditure should also be compared in order to reach just conclusions. In this view I do not concur, because the revenues which are raised by taxation for department, county, city, and town expenditure in Europe and for State expenditure in this country, are mainly used for the support of roads, bridges, schools, police, and for providing water and in many cases gas ; all of which are necessary to the organization of society, and are constructive rather than destructive in their nature. On the other hand but a small proportion of the national expenditures are constructive or necessary to the organi- zation of society, the greater portion of such taxes being devoted to tlie support of armies, navies, and dynasties, or to the payment of interest on debts which were incurred for war, and were imposed by dynastic governments upon the i:)eople without their ■consent. As the time approaches when democratic governments may displace the present dynastic rulers and do away with class privileges, the question may arise by what right these great national mortgages were imposed upon the people of the present day by the rulers of the past. The growth of national debts and standing armies has mainly occurred since the beginning of tlie present century : the question may well be asked how soon the people of Europe will refuse to bear the load which now seems to be as impossible to be borne much longer as it is incapable of being thrown off except by the most violent outbreak of revolution and by general repudiation. Proportion of national taxation to estimated product ; United States 2j per cent. England 6.74 " Great Britain and Ireland 7.87 " Germany 12 " Italy 14I " France 15 " The Relative Strength and Weakness of Nations. 93 sustain life in strength and vigor. Is it not also true that portions of the population of the German empire, especially in southern Germany, are living on the edge of starvation, becoming weaker as they become less well nourished ? In Egypt so much of the miserable product of a rich and productive country is taken away to meet the interest of a bonded debt imposed upon the people without their consent, that starvation exists in the Nile valley, which has once sustained tenfold the present population in comfort. While so-called Christian nations have followed the Pagan example and have again combined " to despoil the Egyptians " by enforcing taxes at the point of the bayonet and the mouth of the cannon, to pay interest upon a debt imposed by a foreign ruler, whose successor has been found incapable of collecting the tax except when sustained by a foreign force, when the oppressed people attempted to resist the wrong ! Is it not true that France has reached its utmost limit of taxation, and the annual deficit is adding to the burden which cannot, perhaps, be borne much longer ? Yet France may be saved from immediate bankruptcy by the richness of its soil and the intelligent economy of its people. Is not the present burden upon Ireland the burning question in Great Britain ? May there not be found in these conditions the underlying causes of nihilism, anarchy, socialism, and communism upon the continent of Europe ? As one witnessess the malignant effect of the burden of national debts, and the power which is given to the great financial magnates of Europe to control events for nefarious purposes, one cannot help looking forward to a time, perhaps not very distant, when the power and right of one generation to mortgage the labor of those who come after them for the conduct of wars will be contested, and when the jurists may declare that no debt incurred for purposes of war shall be lawfully binding upon those who come after. When pay as you fight becomes the rule and practice of nations, the power of dynasties to oppress the people will be almost wholly taken from them. In considering what is left after taxes and profits have been set aside in these several countries, it must be remembered that an equal amount of money will buy a less amount of food in Europe than it will in the United States, and the price of food is much more than half the cost of subsistence to a very large proportion of the working people of Europe ; else we should not be exporting the products of our fields to European countries, and there would be no call for prohibitory laws, or for high duties on grain and pork in a vain attempt to promote an increase of the farm products in Germany and in France by such artificial methods. 94 The Industrial Progress of the Nation. The true measure of these burdens upon industry may be, perhaps, more accurately measured in terms of work than when stated in terms of money or of men. The product of every country stands for so much work. In the census year the work of this country, manual, mental, mechanical, and manufacturing, was performed by one in three of the population so far as gain in money was the object of the work, the bread-winners numbering 17,400,000 in a little over 50,000,000 population. The national and municipal taxes of that year were proportionately higher than they are now ; all taxes, national. State, and municipal, in that year required substantially seven per cent, of the highest estimate of the value of total product to be applied to them. This percentage being applied to persons, represented the year's work of men numbering 1,218,000, whose labor was devoted either to the direct work of govern- ment, or in sustaining all the forms of government by way of national, town, city, county, and State taxes. The national taxes only of the United States are now about two and a half per cent, of the product, and they therefore represent the work of 500,000 persons out of about 20,000,000 workers. This body of half a million persons is either employed directly in the service of the gov- ernment, or else is occupied in sustaining those who are in such service. If the burden upon the United States corresponded to the several percentages assigned to other countries, the number who would be en- gaged either in the service of the government, civil or military, or in sustaining those who perform this work, would be according to the fol- lowing computation, it being assumed that out of our present popula- tion, approaching sixty million persons, twenty millions are at work in various occupations in sustaining the whole body politic : At the ratio wliich the national taxes now bear to product in the United States, the actual work required to sustain all the functions of the National Cjovernment, directly or indirectly, is that of 500,000 men. At the ratio which the national taxes bear to the assumed product of England, the proportionate number of men who would be required in support of the functions of government in the United States would be 1,348,000 At the ratio assigned to Great Britain and Ireland as a whole 1,574,000 " " " " " France 3,000,000 " " " " " Germany 2,400,000 " " " " " Italy 2,950,000 It will be apparent to any one who reasons upon these figures that if either one of these proportionate services in sustaining government, except perhaps that of Great Britain, were in force in this country, it would put a strain even upon our abundant resources that we could scarcely bear. What must then be the burden upon those who are thus loaded ? The Relative Strength and Weakness of Nations. 95 The computed product of two hundred dollars' worth per head of •our population, after setting aside ten per cent, as the maximum addi- tion to capital, and six per cent, as the maximum of all our present national and municipal taxes, leaves only one hundred and sixty-eight dollars' worth to each man, woman, and child. This being divided by three hundred and sixty-five days in the year leaves but forty-six cents* worth per day for shelter, clothing, and food for each person. A variation of five cents per day to each person from this computed average stands for an additional product worth more than $1,000,000,000 a year. Let it be assumed for a moment that our two hundred dollars' worth of product, of which two and a half per cent, supports the National Government, were depleted by national taxation to the extent of fifteen per cent., as the product of France now is, a difference of twelve and a half per cent.; then the average sum available to each per- son per day would be reduced from forty-six cents to a fraction under thirty-nine cents ; not apparently a great variation, — only about the price of a glass of beer, — yet six cents a day comes to over $1,300,000,- 000 on our present population. If we assume that one in three of the population of Great Britain, France, Germany, and Italy is occupied for gain, the whole number of workers is a fraction less than 50,000,000 out of a population a little less than 150,000,000. At the respective ratios assigned to the functions of government, the total number engaged in such functions is now in those four countries 6,067,000, or a fraction over twelve per cent, of the whole working force, thus occupied either as soldiers in active service, as officials in civil service, or in sustaining these classes with bread, meat, and shelter. The actual number of men under arms in these countries is 2,086,000, and they cost two hundred and twenty-five dollars each. It surely takes at least one peasant's or one operative's product to sustain one soldier. If the armies and navies require the services of 2,086,000 men, and if the work of as many more is required to sustain them, then the waste of preparation for war requires the constant work of 4,176,000 men out of 30,000,000 men of arms-bearing age in Great Britain, France, Germany, and Italy, computing one in five of the population of arms- bearing age. This is very nearly one in every seven of the adult men. Deducting this number from the whole number assigned to government service as above, 6,067,000, the remainder is 1,891,000, or proportion- ately about fifty per cent, more than have been assigned to the support of the National Government of the United States aside from their army and navy. The number needed to earn the interest on the national debts of those countries above the proportion required in the United States would fully account for this disparity. 96 The Indtistrial Progress of the Nation. Do not these facts sustain the approximate accuracy of all the pre- ceding computations ? Does not the burden of armaments only require ten to twelve per cent, of the whole number of men of arms-bearing age in those countries, or eight to ten per cent, of the whole working, force, if the proportion of working men and women to the population is the same as in the United States ; to wit, one in three ? But is such the proportion of men and women who must labor to the utmost for subsistence ? When men are wasting their time in camp and barracks, are not the women and children forced to labor in such a way that the physical stamina of the race is deteriorated, and material prosperity sapped at its very foundation ? What must then be the necessary conditions of life when the money's worth to be divided among the families of those who do the actual work of production is only one half as much as it is in the United States ? If the product of Germany is only one hundred dollars' worth per head, it will yield less than twe^iiy-eight cents' worth per day for all taxes, subsistence, profits, and wages to each person. If the product of Italy is worth only eighty dollars per head, all taxes, profits, and wages must be derived from twenty-two cents' worth per day to each person. If, on the other hand, the average value of the product per capita of these European countries cannot be deduced a priori according to the theory presented, then again we must go back to the facts ; and we then find in all the various reports upon the condition of a vast body of the population of Europe that they are actually subsisting upon much less than half the income of the working people of this country. The facts sustain the theory, and the theory may explain the facts. Many records may be found in recent consular reports of the families of German and Italian peasants who are subsisted on only four to five cents' worth of food for each person per day ; and even at that price the cost of food is sixty or seventy per cent, of the whole cost of living. On the other hand, if such are the facts as to common life of great masses of the people, and if we cannot deduce the per capita annual product of each worker in Europe by adding ten per cent, for profit or addition to capital to the average rate of wages and the average burden of taxes, — that is to say, if the product of either country is greater per capita than this measure, then it follows that the privileged classes of Europe are securing to their own use a very much larger share of the annual product than the capitalists of this country can thus secure ; and this adds to the danger and complexity of the problem in Europe, rather than rendering it more simple. What then do these figures and facts mean ? Is not the apparent strength of the armaments of European nations a source of weakness The Relative Strength and Weakness of Nations. 97 which is now working at and undermining the foundation of the present forms of society upon the continent ? Is not our apparent weakness the very source of our strength ? Are we not stronger without expensive fortifications, navies, and other armaments than we should be if we spent our force in construct- ing them ? May not the time be near at hand when it shall no longer be lawful for one generation to mortgage the labor of the next by any national and perhaps by any municipal debt ? When pay as you fight becomes the rule, will not war become almost impossible ? May not the right government of cities be found in more strictly limiting the power of cities or towns to incur debts ? Has not the power of the rings which have plundered our great cities been founded mainly in the abuse of public credit ? Could Tweed have stolen the property of the people of the city of New York had he plundered them by direct taxation ? These may be questions which will soon require an answer, and which are perhaps suggested by the figures and the facts submitted in this treatise. It may be said that the present relative conditions of Europe as compared to the United States require no statistics to bring them into view. Perhaps not ; yet when a great bankruptcy occurs or is impend- ing, the first call of the business man is for a trial balance. Such bankruptcies sometimes occur in arts which are most necessary and must be continued. When the settlement has been made after the bankruptcy, the business is reestablished, but the expensive super- numeraries who had previously lived upon the work of others, are after- ward set to work to earn their own living. In what way the representatives of the dynasties and privileged classes of Europe, or those whose present trade is war, will get their living after a hungry democracy has called for a settlement of accounts will be an interesting problem to watch. The business of government is necessary and must be continued. How will it be reorganized after the impending settlement of accounts in Europe has been completed ? Many other applications of the statistics of these two studies will suggest themselves to him who can read what is written between the graphical lines or underneath the figures. Except to one who pos- sesses such an imagination, statistics may be but dry bones, and all figures may be mere rubbish. 7 LOW PRICES, HIGH WAGES, SMALL PROFITS WHAT MAKES THEM? LOW PRICES, HIGH WAGES, SMALL PROFITS: — WHAT MAKES THEM?' THE minds of many persons have been and are greatly disturbed because there has been in recent years a great reduction in the prices of nearly all the leading articles of commerce, the prin- cipal decline dating substantially from the year 1873. This decline in prices began soon after the war in the United States, but the general decline in all countries on a specie basis may be dated from 1873. By whatever standard prices are measured (and there are many carefully compiled tables), the average is found to be lower at the pres- ent time than at any period since a date anterior to the year 1850, in which year the great supply of gold from California, and a little later that from Australia, began to affect the volume of the money metals of the world. In most of the discussions of the money question this great fall in prices has been treated as if it were a misfortune, and it is often held that any measure of legislation ought to be adopted which might tend to check it. Is not this a very partial and one-sided view of the sub- ject ? Some one has wisely and wittily said that " it does not much matter what happens to the millionaire — how is it with the million ? " If it shall appear that out of this great reduction in prices the mil- lions have gained higher wages ; that hundreds of thousands of families have gained better homes and greater comfort in life ; while those who have suffered temporary loss have been only the rich who have been incapable of adjusting themselves to the new conditions, or the un- skilled poor who have been unable to grasp the greater opportunities for welfare which invention has offered them, then may we not come to the conclusion that diminished profits and low prices are merely the complement of higher wages and lower cost, and are, therefore, most certain indications of general progress from poverty to welfare, yet still leaving the problem open, how to help the unskilled poor ? It will be remembered that it has been stated that so far as the great mass of the people of this and of other lands are concerned, about one ' Reprinted from The Century Magazine for August, 1887. loi I OS The Industrial Progress of the Nation. ■half' the;co?!t of living is the price paid for the materials for food, the cost of food to common laborers who have families to support being as a rule much more than one half their income. The question of interest to those who assume to be strictly " the ■wo?-king classes " is not so much what the price of the necessities of life may be, as it is how many portions of food, fuel, and clothing each one can buy at the retail shops in which they deal, and how good a shelter each one can procure for one day's or one year's earnings. In other words, what is, or what has been, the value of a day's labor when con- verted into the commodities which are necessary to existence ? If these so-called "working classes" have steadily gained in the purchasing power of their wages or salaries, while farmers, who number (not including farm laborers) 250 in each 1,000, have also prospered during this period when prices have been falling and profits have been diminishing, then the economic history of the last 25 years may be pre- sented in an entirely new aspect. In such case, instead of attempting to check the fall in prices by tampering with the standard of value or by other empirical devices "for making money plenty," it may be ex- pedient to hold on to what has been gained and to fight it out on this line, even if several more years of so-called depression should follow this determination, these recent years of so-called depression having actually been years of greatest progress. Since the end of the civil war in 1865, and yet more since the so- called panic of 1873, there has been greater progress in common wel- fare among the people of this country than ever before. It has been the period in which there has been the greatest application of science and invention to the production and distribution of food that ever occurred in any single generation in the history of this or any other country ; and food is the prime necessity of material life. In order to sustain this proposition, it is necessary to establish a standard of subsistence. This can be done with respect to the materi- als which are required for food, clothing, and fuel. Rent cannot be so surely included in this standard, because the conditions of shelter vary so much in different parts of the country and in different cities. The cost of the materials for food, of materials for clothing, boots and shoes, and of fuel, probably represents about seventy per cent, of the cost of living on the part of well-to-do mechanics, railway em- ployees, or of other persons in analogous occupations who may be con- sidered in the average position of working people. All these elements of life have declined very greatly in their prices in the period under consideration. In some regions rents have declined, in others they have been stationary ; in crowded cities they have either advanced in some small measure, or else the apartments hired for a given sum of money have not been equal to those previously occupied. So far as I Low Prices, High Wages, Small Profits. 103 have been able to compare rents, however, either those paid to a land- lord or the rental value of premises owned by the occupant, there has not been, on the average, much variation from the rule affecting com- modities in the period under consideration. The standard portions of food, cloth, boots and shoes, and fuel which are made use of in the subsequent computation of the purchas- ing power of a day's or a year's wages, have been established in the following manner : FOOD, By comparing data gathered by myself with other data gathered by several State Bureaus of the Statistics of Labor, it has been fairly es- tablished that the average food-supply of mechanics and adult factory Table A. — Standard of a Single Day's Table B. — Standard of 400 Rations, Ration, with its average cost in 1880, or i year's supply for i adult with 35 '81, and '82. extra rations. ^ to I lb. meat, poultry or fish, \ 200 lbs. corned beef. varying according to kind and > 100 lbs. salt pork. quality, costing on average. . 10 ) loo lbs. smoked ham. Yz^o -A, pints milk \ lOO quarts milk. I to i^ oz. butter )■ 5 30 lbs. butter. ^ to ^ oz. cheese ) 20 lbs. cheese. I egg every other day ^ 17 doz. eggs. ^ to I lb. bread 2j^ ) i barrel flour. f ^ barrel corn meal. Vegetables and roots 2 @f 2 j4 20 bushels potatoes. Sugar and syrup 2 80 lbs, sugar. Tea and coffee i \ 4 lbs. tea. y 8 lbs coffee. Salt, spice, fruit, ice, and sundries i}4 @ 2 $6 worth assumed at all dates. 25 cts. $100 STANDARD PORTION OF CLOTH FOR ONE YEAR : STANDARD OF BOOTS AND SHOES FOR ONE YEAR : 10 yards medium brown cotton. 2 pairs men's heavy boots. ID " standard gingham. ID " 36. in. bleached shirting. Standard oi fuel for i year : 20 " prmted calico 1 1^ tons anthracite coal or its cquiva- 10 4-0Z woollen nannel, or worsted 1 ^ • i •* • 1 ^J:a ^ , , ' lent in bituminous coal or wood, dress goods. 5 " 16-OZ. cassimere. 5 " Kentucky jean-satinet, or light cassimere. It is assumed that the prices of meat, fish, and poultry, fresh or salt, will have varied substantially with the variations in salt and smoked meats, and as the prices of the latter are more uniformly quoted, the prices used in making up the general standard are those given for salt and smoked meats. In the same way the price of potatoes has been taken as a standard for the variation in the price of all green vegetable food or roots. In establishing the average cost of a day's portion of the above, the jirices given in Vol. XX. of the U. S. Census, in 10 shops east and 10 shops west of Buffalo, i860- 1880, have been averaged for each year designated. These prices have been verified from other sources of information. Prices of dry goods have been verified fully. Prices for 1885 and '86 have been derived from typical establishments and from market reports. The average of 1885 and '86 was probably less than the estimate used. I04 The Industrial Progress of the Nation. operatives in the Eastern and Middle States cost in 1880, '81, and '82 substantially 25 cents per day, and consisted of very nearly the pro- portions of different kinds of food given in Table A. (page 103). The consumption of dairy products, sugar, tea, and coffee given, is probably greater than in other parts of the country ; but if a deduction of 2 cents per day be made for this, it then becomes necessary to add 3 cents per day (probably more) to account for the known average consumption of wine, beer, and spirits. (60,000,000 at 3 cents per day average comes to $657,000,000.) Recent computations put the cost of liquor to consumers $700,000,000. Although the actual consumption of food, cloth, and fuel may not in any single case have corresponded identically with these standards, yet it may be safely assumed that the proportions are correct, and that the variation in the prices of what has been actually consumed will have corresponded to the variation in the prices of these standard articles and quantities. For convenience in computation the small quantities of the single ration of food have been extended so as to cover 400 portions, which may be taken as the consumption of one year by one adult, 35 rations being added for extras. CLOTHING. By a computation made by the writer when engaged in the compilation of the Census of the cotton manufacture of the United States in 1880, it appeared that if all the fibres of cotton, wool, silk, and fiax, imported or raised, were carried through the factories and then converted into clothing, carpets, arid other forms for final use, with the imports of textile fabrics added, the average consumption of textile fabrics by the people of this country in that year was substantially $30 worth per head, of which about $25 worth was for clothing. It being impossible to set up a standard of the exact cost of clothing, certain quantities of cotton and woollen cloth have been taken which are a little above the average consumption of the whole country. In a final computation, cloth is converted into clothing at the ratio of three parts materials, and two i)arts for manufacturing and distributing. In this computation I have made great use of the XXth Volume of the United States Census. It was prepared by Mr. Joseph D. Weeks, and is of the greatest value in statistical research. BOOTS, SHOES, AND FUEL. The standard of boots and shoes, and of fuel is of necessity some- what arbitrary. It has been set at two pairs of men's heavy boots, as the equivalent of a customary supply, and one and one half tons of coal per adult per year ; it being assumed that, as the prices of these quan- tities have varied, actual use and cost will have varied. Low Prices, High Wages, Small Profits. \o- The quantities assigned to this specific standard of subsistence have risen and fallen in the following proportions, the figures repre- senting so many cents per day for each standard portion, and the lines representing the relative variation at different periods : COST OF STANDARD PORTIONS OF MATERIALS For Food, for Clothing, Boots and Shoes, and Fuel, per Day, in Each Year as Designated. Materials for Food. Materials for Clothing. i860 22^V Cts. 38/A " 33tV(T " oris " 22 " Est. i860 1865 1870 1875 1880 1885) 1886 s 4TVtT Cts. 4t«A " 4T^Ar " -i-ti^ " Est. 1865 1870 1875 1880 1885^ 1886 f Boots and Shoes. Fuel. i860 1865 1870 1875 1880 1885? 1886 \ ir'n'Vcts. 2 lA-V " Est. — i860 1865 1870 1875 1880 1885? 1886 f 2tVtT cts. 4AV " StVtt " 3 2,^ " Est. — It is doubtless true that the goods reported upon in the several shops from whose reports the prices have been derived, may have varied somewhat in quality ; but the questions put by Mr. Weeks were in such form that in nearly every case the prices are given for specific qualities of each kind of food, as for instance : Flour, grade " extra family " ; coffee, " Rio, roasted " ; sugar, several grades — I have selected a medium ; tea, " Oolong, or good black," etc., etc. These prices, taken from 20 shops — 10 east and 10 west — have been averaged, and the results compared with other price-lists, many of which the writer has himself procured. It may be objected that this standard portion is only the one which is customarily consumed by each adult in the families of well-to-do mechanics or factory operatives in the Eastern or Middle States, and that it may not be a fair measure of those who are above this class, or of those who are much below them. This may be admitted ; but nevertheless all prices of the necessities of life must have varied sub- stantially as these standard portions have varied. Moreover this final fall in the prices of products at their final point of consumption could not have occurred had not the prices of the metals, of the machinery, and of the whole mechanism of production and distribution also fallen. Sometimes prices of invested capital have fallen even in greater measure than the prices of the products. It is only here and there that any important article like timber can be found, which having become more scarce, has either maintained its price throughout the period, or is even a little higher now than it was in i860. If, then, all prices have fallen and all profits have diminished while wages have risen, each subject to temporary fluctuation and variation, io6 The hidustrial Progress of the Nation. must we not seek for deeper causes for the changes in the conditions of society and in the relations of men to each other than are commonly assigned in the explanation of such phenomena ? I now submit adequate proof of the facts. The subsequent table gives the purchasing power of wages at different dates, when converted into standard portions of food, cloth, and fuel as established. The quantities represented in these tables are assumed to have been established on the basis of actual consumption of a well-to-do mechanic in New England in the period of 1880, '81, and '82. If we convert the money assigned to each portion of food, fuel, clothing, etc., into 400 portions corresponding to one year's consumption, with a margin of ten per cent, for extras, we get the following results : COST FOR ONE YEAR. ONE PERSON. Food for one adult fioo Materials for clothing 16 Boots and shoes 7 Fuel g FOUR PERSONS. Food for four adults ' $400 Materials for clothing 64 Boots and shoes 28 Fuel 36 Gain in the purchasing power of wages, measured by the number of portions of the materials for food, clothing, boots and shoes, and fuel, which one year's work would buy at different periods: 300 working days to one year. Each portion consisting of the same quantities and corresponding to the daily consumption of mechanics in New England and in the Middle States, as determined by close inquiry on the part of Bureaus of Labor Statistics, and of the writer. Class I. — Specially Skilled Men : Foremen, Overseers, Boss Blacksmiths, Carpenters, etc.. Customarily Earning $3.00 to $5.00 per Day at the Present Time. Year. i860 1865 1870 1875 1880 1885) 1886 c Aver- age, per day. $2.45 3-57 4.34 Average per year, 300 days $735.00 1071.00 1302.00 4.14 1242.00 4.14 1242.00 Probably higher than in 1880. Cost of day's portion. 30x%V cts. SSxiFiT ^T 53 " 43TBir 33tot Est. 30 cts. or less. Purchasing power in number of portions. 2374 1920 3000 3210 3737 Not less than 4000 Class II. — Average Mechanics : Engineers, Blacksmiths, Carpenters, Machinists, and Painters Connected with Establishments Reported in Vol XX. of the Census 1865 to 1880 Inclusive. Year. Average, per day. Average, per year. i860 $1.56 $468.00 1865 2.34 702 . 00 1870 2.43 747.00 1875 2.29 687.00 1880 2.26 678.00 1885 1 1886 f Est. 2.40 720.00 Cost of portion. 30^5^ Cts. ec «9 " 55X5 ir 43150' oQ 09 '< 30roTT 33Tffff Est. 30 cts. or less. 1572 1261 1716 1776 2040 Est. 2400 Purchasing power. ' Or for man and wife, one child over twelve, and two under twelve. Low Prices, High Wages, Small Profits. 107 Class III. — Ai,i, the Operatives, except Foremen and Overseers, in 100 Establishments Reporting the Wages of their Working People under More than 1200 Separate Titles: Bricks, Marble, Furniture, A(;ricultural Implements, Tin Ware, Stoves, Boots, Hats, Cars, Wagons, Flour- and Saw-Mills, Iron, Paper, and Textiles, Employing Men, Women, and Children, from 20 to 2000 in Each. Year. Average, per day. Average, per year. Cost of uniform portions, food, cloth, and fuel. i860 I1.33 $399.00 30r(H7 cts. 1865 1.88 564 . 00 SStVt. " 1870 1.94 582.00 43T^rfV " 1875 1-77 531.00 ss^'V " 1880 1. 71 513-00 333^^ " 1885/ 1886 j Est. 1.80 540.00 Est. 30 cts. or less. Purchasing power in number of portions. 1290 1013 1337 1372 1543 1800 Class IV. — Laborers, Computed Separately, Connected with above Establishments. Year. Average, per day. Average, per year. i860 fl.OI $303 . 00 1865 1.56 468 . 00 1870 1.58 474- 00 1875 1.38 414.00 1880 1-34 402 . 00 1885) 1886 j Est. 1.40 420.00 Costof uniform portions, food, cloth, and fuel. -io^-i^ Cts. re 6 9 «« 43rfriT oO 6 9 " 3^T^TT 33TDTT Est. 30 cts. or less. Purchasing power in number of portions. 980 840 1090 1070 I2IO 1400 The portions consist of uniform quantities of the same kinds of food, cloth, etc., and fuel bought at retail prices. The wages from i860 to 1880, inclusive, are averaged from a large number of returns contained in Vol. XX. of the U. S. Census, compiled by Joseph D. Weeks. The cost of making and trimming, or of converting the cloth into clothing, would be for converting these specific quantities : For one adult $ro For four adults 40 These elements constitute on the average seventy per cent, of the expenditure of a family such as has been taken as an example. We may add For rent eighteen to twenty per cent $37- 5° $150 For sundries . . .twelve to ten per cent 20.50 82 Totals .per adult, $200 ; per family, $800 If we take the example of a mechanic sustaining himself, wife, one child over twelve years, and two under twelve counted as one adult, an average family of five persons counted as four adults, an expendi- ture of $800 per year would call upon the head of the family to earn $2.67 per day for three hundred working days in the year. It will be remarked that this standard has been reached theoretically^ io8 The Industrial Progress of the Nation. < < w z c O b O « < H Z u u K U) A< >• Q U. B! <: cu S o O Id Z O b O Id O P. o z (J D a Id < Id U. u Z .2 •^ ^ •6S. ■fe^ X,^ \v^ ^."^ ^ ?l «1 t^ (?■ m H ^ ;:; •■^ I.H (/) id s (3 o o o u on the basis of facts derived from obser- vations entirely independent of the actu- al statistics of the family expenditure gathered by Commissioner Carroll D. Wright, as Chief of the National Bureau of Labor Statistics, and until lately also of Massachusetts. On comparing these theoretic estimates with these statistics, they are found to correspond so closely with the actual facts gathered from many families, as to sustain the substantial ac- curacy of the proportions of the cost of living, the price of food being exactly one half. In the returns which have been made use of in compiling the tables given in this treatise, there are doubtless reports of prices of goods which do not exactly correspond to others either in kind or quality ; but so many returns have been averaged as to eliminate this cause of error. I have made many computations on single returns of prices in special places procured by myself, and I find that the proportional variations corres- pond so closely to the average of all as to establish the standard conclusively. In fact, the reduction in the cost of subsistence and the increase in the pur- chasing power of wages in the East have been greater than in the West, and great- er than the average of the whole country, doubtless owing to the equalizing force of the railroads in diminishing the cost of food. I may give one example for which I have collated all the figures myself in order to verify the compila- tions of the census. In this example I have taken the year 1866 as a starting- point, and a cotton-mill as the example. It is not a fair year to show an average in other arts, because the conditions of the cotton manufacture were very un- certain during that year ; and it was also Low Prices, High Wages, Small Profits. 1 09 in the year 1866 that the most malignant effect upon prices and wages, worked by the substitution of legal-tender notes in place of coin, was experienced in the United States. I have, however, selected a year in which the work was continuous during that year as well as during the year 1885. The average earnings of all the hands in the factory through the year 1866 were 83 cents per day. In 1885 103 " " " The product of each hand in pounds of cloth was in 1866 7 pounds per day. In 1885 13.34 " " " The cost of labor in the pound of cloth was in 1866 11.85 cents. In 1885 7-67 " The cost of the standard portion of food, clothing, and fuel (sub- stituting three cords of wood for the customary portion of anthracite coal, because this factory was in a position where wood at that time was cheaper) was : Daily portion of food, clothing, and fuel in 1866, cost 57-82 cents per day. In 1885 30.97 " " " The purchasing power of 300 days' wages converted into these standard portions was in 1866 430 portions. In 1885 1000 It will be remembered that the price of food is about one half the price of life to the class of persons represented in this example. Other examples have been computed by myself from private data in respect to the condition of operatives in woollen-mills and machine shops. They show the same law ; but as the condition of the woollen-mill and the machine shop was somewhat better in 1866 than that of the cotton- mill, the ratio of progress is more nearly that of the average of the whole country than is shown in this particular example. One very curious point is brought into notice by an analysis of the average food ration of the American workman. All the pork could be spared, and yet the daily ration would be more than ample. The waste of this country is an excess of fat rather than an excess of any other part of the food consumed. We have often heard " the Ameri- can frying-pan " denounced ; but this is, I think, the first time that it has been subjected to a scientific condemnation. In a rough and ready way it takes five pounds of western corn to make a pound of pork. Even the hogs do not consume their whole ration ; they waste a part of it. The proi)ortion is substantially one thousand pounds of Indian corn to a barrel of pork weighing two hundred pounds. In this conversion nearly all the starch and all the protein are wasted, and the fat which is left is not required for use. The necessary deduction is this, that the conversion of corn into pork is an absolute and total waste of nutritious food. Far better that I lO The Industrial Progress of the Nation. corn should be converted into beef, or even burned for fuel (often a very economical expedient for settlers), rather than to be expended in this way. A curious question arises in this connection. If the world were convinced that the Jews were right, and that pork ought not to be eaten ; or if the American world were convinced that all the pork that is eaten is wasted, what would be the effect on the American farmers ? Having submitted this part of the problem to Professor Atwater, he makes the following remarks thereon : " Taking your figures for quantities of shelled corn and dressed pork, and the most reliable data I can find for their composition, I obtain the following figures : GAIN AND LOSS OF NUTRIENTS AND POTENTIAL ENERGY IN CONVERSION OF CORN INTO PORK. NUTRIENTS. POTENTIAL Protein. Fats. Carbo- hydrates. ENERGY. In looo lbs. of corn Pounds. 100 18 Pounds. 45 85 Pounds. 680 Calories. 16,400,000 3,900,000 In 200 lbs. of pork Loss or Grain 82 loss 40 gain 680 loss 12,500,000 " In other words, the fat is increased by 40 pounds, and to offset this there is a loss of 82 pounds of protein and 680 pounds of carbohydrates. Estimated in potential energy, the loss makes over three fourths of the whole. " According to the best data at hand, and your ration agrees with them, our ordi- nary dietaries contain an excess of carbohydrates (sugar, starch, etc.) and a very large excess of fat. The ' condensing of corn into pork,' which we hear of as ' useful to save cost of transportation and handling,' means — " First. Practically throwing away a lot of protein, the most valuable of the food ingredients, and with it a large amount of carbohydrates. " Second. The conversion of part of the other nutrients into fats, so as to in- crease our already great excess of this material." This may seem a somewhat trifling matter. Let us see. Assuming that the product of this country, at its market value for final consumption or export, cannot exceed $200 worth per person, $600 worth for each group of three of whom one is occupied for gain, or $rooo worth for each average family of 5 persons, it may be assumed that not exceeding 10 per cent., or $20 worth a year per cap- ita, can be saved, and added to the capital of the country, however such capital may be owned individually ; 5 to 6 per cent., or $10 to $12 a year, must be set aside to meet all forms of taxation — national, State, and municipal. There remains $168 @ $170 a year, which con- stitutes the wage fund, it being manifest that the source of all wages, earnings, taxes, and profits must be the annual product, whatever that product may be. Low Prices, High Wages, Small Profits. 1 1 1 If these sums per year be reduced to portions per day, the wages or earnings of each person amount to a fraction over 46 cents per day, or $1.38 for every day in the year, including Sundays, secured by one person in three of the population who constitute the working forces. Profits amount to a fraction under 5^ cents per day ; taxes to a frac- tion over 3 cents. The cost of the excess of fat and sugar in the standard ration is 7 cents out of 25. If this were saved and applied to shelter, the housing of the working i)eople would be solved. There cannot be more to be divided than all there is. The whole question, therefore, of relative welfare and poverty consists in the manner in which this product is divided. The only way in which any great gain can be made is by increasing the quantity of product while decreasing the amount of capital and the hours or intensity of the work required in production, or else saving what is now wasted. Any other method of distribution that could be brought about might not very greatly improve the condition of any very large number of persons. This will be made apparent by a few figures. If the sums given constitute all the money's worth there is to be divided, then by so much as some gain more must others gain less. The limit of all that is produced is the limit of all that can be divided. The working group of this country, as I have stated, is substantially a group of three. One person in each three is occupied for gain, sus- taining two others. If that part of the product which is now saved were divided equally among those who do the work, it would add only about 15 cents a day to the income of each one, or $54.75 each year. In the present population of about sixty million, the number who are engaged in gainful occupation is twenty million. If the whole sum saved and added to capital were divided among this force equally at $54.75 each, it would represent a little more than $1,095,000,000. Suppose this sum now saved were equally divided, — is it not true with regard to a very large proportion of those who do the work that the measure of their income is also the measure of their expenditure ? Could this equal division then be made without leading to an increased consumption rather than to additional savings on the part of the many ? If so, the next year's product of the whole country would suffer for lack of capital. It sounds like a paradox, but it may nevertheless be true, that the faculty for " making money," as it is called, — that is to say, the instinct that leads to accumulation on the part of the few, — is ab- solutely necessary to the comfortable subsistence of the many. Dis- parity in the possession and direction of capital is apparently necessary to its effective use — a big capital in the hands of a master is like a big steam-engine directed by a competent engineer ; each compasses three or four times as much product as the small capital held by many per- sons, or several small steam-engines each wasting fuel, can accomplish. I 12 The Industrial P7' ogress of the Nation. It may not be the disparity between rich and poor which is the sole cause of discontent. The disparity in the conditions is very much greater, and is in- creasing more rapidly among those who constitute the " working class- es " themselves, in the narrow use of that term, than any possible dis- parity between the capitalist classes and the working classes can ever be ; that is to say, the disparity of the aggregate income, class by class, is greater. The capitalists are working under an imperative law of diminishing profits. The workmen who do the work intelligently and skilfully are progressing under an imperative rule by which their wages are increased while the purchasing power of their wages is yet more increased. Is there not perhaps a more subtle but very potent cause of dis- content disclosed by the great disparity in the progress of working people themselves to the exclusion of capitalists, than can be found in the disparity of fortunes or in the possession of capital saved ? In the following table the relative progress of four classes whose condition has been fully analyzed is graphically pictured, each class com- pared to the other by the relative percentage of their gain since i860 • tSco iScs- 1810 rdyf /SSo /S8s*t ^7V ^^^^^ ^2-/0 J ■itt-OO • I / 2374 \ 'll^-i-O i.Of II 1512 ^ ryii 'yj6 ioyo ITT 1290 /i-iy IV 980 /a6'w poverty. This problem of " progress ^ li t> T3 OJ U -t N M c 5 ^ J' .a > r^ O CO n S o > ■^ oi CO r^ o_ .13 ^ § 2 _e _ < "S ^ f^ to e« 13 o en d^ C 5 in - "3 O M « ^ w O TO ^ c^ r^ m B o t^ "-w O 1 rt -g CO O CO cE O V • 2 c Is « i ° •- (!> (u rj n :! -g 8 ^ B 'C cr H H < bO ^ .» c ^ u .SiB s>. . •J3 4J ■ ■ - B ^ Si; 6 JSj3 1^ « o. •U §e O. 1 1 1 m n c 1 1 1 ft o 1 1 1 bog *^ ^_ ^^^ ^^^ 1 1 c ^ 3 v£ 2i-Hu-)LnaOir>Ocl 1— 1 cn H l^inO C^ \ri ^\ d \Ci ^ e c '■ }• c 5 V n ► -1 a r^ r^ r^ Tf Oco r^O w "i-irio rt-^l"C<^l c ^lr)Coa^^>•m^.'i■^c^ IH ? ^co r^co r^oco r^o ) Sc' >-• IM C 1 C >l h H h H ► H W W M M » H . ■ ■ o ^ C.5 O rt ^ l< ^•s w ^ 1 D S ^-a ; « w -^>, u-^ o -a > (U 5-a li "2 >> |i ■ 1 si! 1 ■T3 1S c a rt n u •rtO 1- OJ .^2 c I- r^ o ^^^ i^^BN ^^^'" ^^^^ ^^^^ ^^^"* ■^■M 15 2 > o O o c c ) o o o o ) c ) C C O O o o c Q o s o O c , s c o o o o c ) c o o o o c Q o O o c o o o o_ c c ° ° o o c o Tf n' o ir 1 C ?; c " t-C d^ d> oo" c T - ^ - r- - vO m" CO O o" oc o* o 01 M M r- N U ■> 1- N vn m m Ti r o c ^ O N r- - en o ^ O M 1- o H en r: ■ ^ \t 1 u ■) 1- M N O vO u -> c ^ ee 1 f- - CO o ■s O r^ u ■> en "■? Tt ■d ■ CO M C ^ ^ - m" m" m" d> r- - C ^ ^ e*- 1 O 1* O ^ O 11 C ^ w •-< B ID T) ■ \i > W ^ 1/ 1 T 1- -i- CO CO r^ e' ^ c ■) e' 1 w 1 o rt u- 5 00 -* M en ^__ q N vO (— r- ^ C<^ W t^ CO O ^ r ^ u ~L '^ M in O i-i M r- « en « )-( N N 0) c ^ c ■) -f in in U-) ir 1 <: ^ CO o d" M M M C M •o'C M t-l M I-I KH h— HI B rt M vO T} • C ^ u ■) u ■1 O r« t~^ N \x ^ u T vC M vO t-« ■* N 00 O M 13 o M ir ) o N U ■) c 1 «-) it c^ in \i 1 <: r ^ w 0) OS w O O vO in OJ r~> ■^ Tt ■ vO H t- O en c M ^iS > o w Q > "d ■ t- ■ VC -c CO 'i- r^ CT> O ^c ^ h Tt - u- > r^ o CO in r^ M g »r> Q > O ^ vO 1/ ■) u ") O en M c> ir 5 vC e* 1 N co en IH ■* o o s N ">< (/I M O ir r - u- ;> ^ O 0_ co_ CO O ^ t- t- M ir > C> O^ O vO ei- in -g B O H M W ir r- ^ O H ~ in oo" cT n" N vC vC d ^ co' en ci Tt vd~ -^ vd" M M tH M N W M N en en e<- 1 C ■> c 1 e<- ) Tf ■ >n vO vO O vO o ^ 3 .O I/) CL| a 1 _> "H" c c U-1 vC I-^ co' d ^ d M m' en -t" IT' -d r^ • co" d d M fi en -4 in B n vO O vO vO o r- . i^ t^ t^ i^ r^ r~ . I-- . r-. i~> CO CO CO CO CO CO -" u CO CO CO ao CO co CO CO oo CO CO CO CO CO oo CO CO CO CO CO oo Pi >* w M M M M M M w M i-i >H M w M I-I M M M tH M M > Low Prices, High Wages, Small Profits. 123, -w 4) • ^ CO Fi CO 4.I-I rt ^ •n .n c t3 > ,13 ■«-> H 0! n i^ vT 00 r^ ■4-* cS H 1- ^ 13 -1 ui r^ i^ X r^ ^ cri to CO CO M cc 1^ CO lo ^^ ^t* U-i r, CO M tJ> 4> V<4 (J !£ c l-t m N vO 'i" W M O CO O C) CO c^ O CO CO ^ vn in iH O O t-^ •* ■O f^ r^ O w a^ CO o 000 r^ CO vo O •* CO PI O O 'T en CO \rt O cocncocncnc CO in en CO CO cn o" in in CO CO en O CO vO in 00 cn CO vn 00' cn M in 00" in q_ cn cn 01 q^ co' cn q_ i-^ cn o C0 in cn ■^rj-vo rococo 00 en cn in CO CO PI en en rt u >• in O vO O CO CO o CO CO o CO o CO O M CO CO PI CO cn -1- in o r^ r^ r^ r~~ t^ r-- 00 CO CO CO CO CO CO O O w t^ 00 CO 00 CO 00 PJ 00 00 cn CO CO CO CO CO CO 124 The hidustrial Progress of the Nation. o O ♦J P« z B u 6 1-1 o Ml tn C o c « ^^ o o c QJ a n* rt ,Q O (U ^;^ « O. o c O rt n tfi o •o m M n n u: t/i bi B u O-C > — Q. J3 B c So c u J3 ^ >. XI •£ " .S "" 'b2 O o I" j: > ° « in o o it^ « - i «&£ <<_ I. 4) >- > v: c/l o r^ CO O o M W CO >* tn vO f~- CO o> O IH N CO 1- in vO o vO O r^ I^ r^ t^ t^ t^ J^ r^ i~^ r^ CO CO CO CO CO CO CO CO CO M CO M CO M CO M CO M CO CO M CO CO CO CO CO CO M CO M CO M CO CO CO w o o o O no t r^ o M o o O M in O CO -t -+ CO (-> o 0^ ■* t^ O CO t^ M 1- CO o M CO l^ rt- M r^ M O CS o O t CO rt o (J o CO -1- M M lO r^ t^ ^ in ON O vU lO in ^ ■^ ^ Tf <:> <5 r^ r^ o m €& o a. W in in M c< O vo M CO in -^ CO ■^ O O CO O^ in vO O in '^J* w M ^ CO CO vo" CO rC O in in «) on nn o M in O M "* CO M '^ '+ O in CO M in O r^ M CO CO Tf r>. CO i-c ci" in (5 o o o O rt O 1,-vO S m o o CO O^ in in CO vn O w CO r^ r^ t^ r^ in Tt- '^ 'I' •i- vO CO M CO M t^ CO r- O C7> O CO O CO ON in N O O m \0 ^ '^ CO t^ vO CO t^ O U CO in o CO c< PI 0) in ON r-~ CO CO vO ON ON »0 t^ CO CO vO r^ M in PI ON O M IH O CO Tf- IH t^ PI vO O t^ O M I^ M CO O -^ in -J- rj- O CO On in O in On no in O CO in PI r^ M o in M i~>. PI ON M t-^ CO r^ On CO r^ i^ CO CO CO in in r^ NO Tt- CO ON CO CO CO ^ NO PI CTn CO On "Tf CO M CO in CO m M CO -t- •* On CO N M NO CO CO PI ON CO N NO CO O P< P) CO IH -i" o in in m in vo 'torn PI M CO NO t~- CO o ON O CO O PI in PI Tj- "^ r^ CO r~» t^ NO t^ CO On O tH NO O vO O r^ t^ CO CO CO CO CO CO P) CO CO CO in nO r^ CO On O ih r~. r- r^ t-> i^ CO CO CO CO CO CO CO 00 00 P) oo CO CO ■* in CO oo 00 oo CO CO Low Prices, High Wages, Small Profits. ^25 Merchandise traffic of all the railways of the United States in 1885 ; authority, " Poor's Railway Manual," 1886 : Tons moved 437,040,099 Tons moved i mile 49,151,894,469 Charge for service $519,690,992 Rate per ton per mile cents. . I-057 Twenty-seven trunk lines which, separately or in combination, centre in Chicago from the West, or connect Chicago with the Eastern seaboard : Tons moved 185,320,709 Tons moved i mile 25,125,076,247 Charge for service $219,872,732 Rate per ton per mile cents. . .875 All other lines : Tons moved 251,719,390 Tons moved i mile 24,026,818,222 Charge for service $299,818,260 Rate per ton per mile cents . . i . 248 Measure of this service per head of population and per family : Lines. Twenty-seven trunk lines. All others Total. Tons per person per year. 3-252 4.420 7.672 Distance hauled. Miles. 136 95i mi Average. Charge per per- son. $3.68 5.26 $8.94 Charge per family of five persons. $18.40 26.30 $44.70 The average charge per ton per mile on the 27 trunk lines in the years 1S65 to 1868, inclusive, exceeded that of 1885 by 1.635 cents. At this rate of excess, applied to the whole traffic of the United States, all other lines having made a greater reduction, so far as the data can be had the sum saved in the year 1885 was $803,633,477. The whole service of all the railroads in 1885 consisted in moving 42 pounds a day of food, fuel, fibres, and fabrics, a distance of lii^ miles for each man, woman, and child of the population, or 1,470 pounds a week for a family of five. The average charge to each person was a fraction under i\ cents per day, or 'i,-]\ cents per week for each family of five. The 27 trunk lines treated in the foregoing tables perform about one half the freight service of the United States. The average charge per ton per mile on those lines, 1866 to 1873, inclusive, was 2.315 cents per ton. 1874 to 18S5 1-196 " Difference i-HQ " Had the actual traffic of those lines from 1S74 to 18S5 been charged the difference, the amount of such additional charge would have been over $1,756,000,000 The excess of exports over imports in this same period was $1,574,021,528 It thus appears that the reduction in the railway charge taken by itself without regard to other reductions in the cost of production and distribution, sufficed to enable this country to resume specie payment in 1879. In fact, if all the changes which have been worked by the elimina- tion of time and distance from the conduct of affairs were to be consid- ered, it would require a volume instead of an article to picture them. 1 26 The Industrial Progress of the Nation. It thus appears that, while the purchasing power of a day's or a year's labor has increased since i860 from 40 to 70 percent, according to the grade or skill of the workman, and from 66 to 108 per cent, since 1865, and while the earning power of capital, considered without regard to the skill of its owner, has diminished absolutely one half and rela- tively at least 75 per cent, since i860, there have yet been periods when it has been difficult for many workmen to find work, when also capital could not find employment, and when there was want in the midst of abundance. Can these faults in the present forms and methods of society be remedied by legislation, by cooperation, by profit-sharing, or by the state assuming more and more the control and direction of the forces of capital ? These are questions which demand an answer. That there has been grave discontent on the part of labor, and a want of that true comprehension of what may rightly be called " the claims of labor" on the part of many capitalists, may not be denied. What are some of the causes of this discontent, and how shall admitted wrongs be righted ? It is a matter of common knowledge that the application of machin- ery in special arts often causes the displacement of the craftsman, the hand-worker, or the common laborer who has been trained in that art, and who finds it difficult to adjust himself to new conditions. This fact, which has been a matter of common observation in single arts, has affected nearly all the arts of life in the last twenty-five years more pro- foundly than ever before. There have been single great inventions, like the application of steam, which have gravely altered the conditions of society ; but there have probably never been so many applications of science and invention to the common arts of life as have been applied in the present generation, nor has any single one ever been so potent in modifying and changing all the conditions of society as the sinking of time and distance in the fraction of a cent a ton on a mile of railway. In this country, where these great new forces have been more free to act than in any other, there are certain facts which must be admitted by every one competent to observe. Leaving wholly out of view the transfer of property already saved from one person to another in the gambling operations of the stock exchange, such incidents being of no material consequence except to those who engage in them, we may observe : First. That the direction and use of capital are becoming more and more a matter of scientific training, as the margin of profit in every art comes to a less and less fraction of the product made or distributed. The merchant adventurer has gone the same way with the craftsman and his apprentice — he has disappeared with the removal of the mys- teries of trade. Low Prices, High Wages, Small Profits. 1 2 7 Second. Although great fortunes have become more conspicuous, their number is very small, and their aggregate amount is yet smaller in proportion to the amount and great number of moderate fortunes which are not conspicuous but which are steadily increasing. Third. Adjacent to every city are suburbs or neighboring towns which are filled with comfortable dwellings of moderate size, which give evidence of comfort and welfare steadily increasing on the part of an increasing portion of those who perform the practical work of the country. These are the dwelling-places of their respective owners or occupants, who are not capitalists in any sense, but who have assured to themselves an abundant subsistence, a home, and a safe position in the community. Fourth. While great bonanza farms are conspicuous, they are also few in number ; the increase in small farms is very rapid ; and perhaps the increase has been yet more rapid compared to what it had been before agricultural machinery, science, and invention had come nearer to the farm. Fifth. By comparison with this rapid progress not only of those who are in a position of wealth, but of the vast number who, although not making great savings, are living year by year more comfortably, better housed, better clothed, and better fed, the bad condition of the very poor, and the more uncertain position of the common laborer Avhose opportunity for work is intermittent, becomes more apparent and therefore demands urgent attention. If such are the facts which are disclosed by the actual observation of the conditions of men, and confirmed by the deductions drawn from them in this and other cities, do we not find in the very gain in the purchasing power of wages a cause of an increasing disparity in the conditions of those who class themselves as " working people," in a limited sense ? and may not this be one of the grave causes of discon- tent, even though all have made some progress ? Is it not ai)parent that while the very poor are proportionately no more numerous, and the ratio of common laborers to others is no greater, yet within the lives of men who are not yet beyond middle age, great numbers among the workmen themselves have seen those who started on nearly the same plane, and who in i860 could earn but little more than their fellows, yet in 1885 and '86, raised far above them in their condition, although still classed as fellow-workmen ? To him who has had the capacity, either mental, mechanical, or manual, to take advantage of the opportunity afforded by science and invention, has been given the greatest progress ; while from him who has not the mental or manual aptitude to adjust himself to the new conditions, has been taken even the opportunity for common labor which he enjoyed before. 128 The Industrial Progress of the Nation. Do we not witness in the various organizations of labor, so called, an attempt to equalize this growing disparity ? It is often claimed that " equal work is entitled to equal pay " ; but the difference in the quality of the work may not be overlooked. The attempt is made to control the hours of labor by various artificial methods. In respect to minors, and possibly in respect to women so long as they do not vote, such laws may be necessary. Other attempts are made by establishing stated lists of prices, by limiting the quantity of work to that done by any one man, by limiting the number of apprentices, and by other similar methods, to equalize the material conditions of men. But all these efforts fail wholly or partly. An equal quantity of work meas- ured only by the time devoted to it or by the actual amount of work required in it, never has and never will secure equal results. It is not in the nature of things. It is the efficiency of labor that tells, not the quantity or time. One man will waste more leather in a given time by want of aptitude or skill in its use than another man will convert into good and useful boots and shoes. Profit may be defined as the margin which mind gains over muscle. This is as true of the higher gain in skilful work when done by the piece as in the use of capital already saved. The result of all these artificial methods to control conditions which rest upon individual capacity, when even partly enforced, is to level down the earnings of the industrious and the capable to the plane of the unskilful or lazy. When this truth dawns upon the mind of the discontented, then the trade organization or association soon changes its course and begins to promote the development of individual capacity ; it becomes a common school in social science ; its members soon find out what a really beneficent force may be developed by organizing labor. I have endeavored to present the great price-making forces which have been evolving progress from poverty during the present genera- tion, and I may again repeat what I have often had occasion to state. The necessary conclusions to which we are led are : First. When organized capital is placed at the service of labor, it be- comes more and more effective, while in amount it diminishes in ratio to product. It therefore secures to its own use a diminishing portion of, or profit from, an increasing product. This is the economic law, so called, of diminishing profits. Second. Organized labor, when each member is left free to avail him- self of every opportunity which capital, science, and invention place at his disposal, secures to itself an increasing share of an increasing product or its equivalent in money. Third. As capital and labor become more under the control of common intelligence they cannot help becoming more closely allied ; Low Prices, High Wages, Small Profits. 1 2 9 under these conditions high wages or large earnings in money, or in what money will buy, become the necessary result or reflex of the low cost of production. Fourth. A low cost of production accompanied by high wages is most fully assured by the application of science and invention to all the arts of production and distribution. Pauper labor so called, may be dreaded only by those who possess pauper intelligence. The com- petition which is really to be courted and emulated is that which is represented by the art schools of France, the weaving schools and the like of Germany, the trade schools and the industrial schools which have spread more rapidly in England in recent years than they have in this country. Skill and intelligence, free from the burden of stand- ing armies and of war taxes, may command the commerce of the world. The present population of the globe is computed at about 1,400,- 000,000 ; of these only about 400,000,000 belong to what may be called the machine-using nations. One billion do their work by hand, or by the use of rude tools guided by the hand. In a peaceful contest for commerce with these nations, who will win ? Certainly that nation will not win which obstructs the import of the crude products which are all that these non-machine-using nations can give in exchange for what they need, by imposing heavy taxes upon such products when they enter the ports of our country. But when all has been accomplished which can be done by law or by association, or by the repeal of obstructive acts, there will still re- main centres of pauperism in our cities ; they exist mainly among those of foreign birth who cannot adjust themselves to the new conditions to which they are subjected. There will also continue to be periods when common laborers will find it difficult to obtain work. How shall we meet these admitted faults ? Is there any other way than by adapt- ing the methods of common-school education more nearly to the necessities of life ? If it is true that one cannot i)ermanently help either men or women who cannot help themselves, is it not equally true that classes in society in considerable numbers cannot be raised from a state of dependence upon others, except by the development of each member of such class to a knowledge of some art by which he can sus- tain himself, even if it be only a training in the application of the hand itself to useful work ? Nine tenths of the occupations of the people of this country in point of number still depend upon the individual capacity, the mental development, the mechanical aptitude, or the manual dexterity of each person. Only one in ten is occupied in a great factory where the con- duct of the work depends upon the minute subdivision of labor. Does not this fact bear witness to the necessity of promoting the 1 30 The hidtistrial Progress of the Natio7i. development of the individual in order that common welfare may be attained by every man, woman, and child in the community ? What can the state do for its citizens in helping them to obtain sub- sistence, if the people who constitute the state are themselves in- capable of sustaining their own families under present conditions ? Neither the state nor the nation possesses property. The state only controls the property of its citizens by right of eminent domain. It can take property under the due process of law for public use, with compensation to him who owns it. It can tax all property in order to maintain governments. It may tax all property in order to perform certain useful functions which, by common consent, the state can per- form in its corporate capacity better than the citizens can in their individual capacity. But the state as state has no productive power, and it is upon the annual product that all depend alike. In this country at the present time there is and can be no lack of most abundant product. We waste every year enough to sustain another nation half as numerous, if not equal in number. The mech- anism of distribution is more than ample ; yet there is want in the midst of plenty. Progress from poverty is the common rule. " Progress <2«^poverty " is the marked exception, conspicuous and dangerous. In one sense every man is his brother's keeper. If he neglects his duty and cares not for his neighbor, the tax-gatherer, at least, will find him out and will compel him to do at the greatest cost what perhaps he might have accomplished at the least cost, had he himself realized his own respon- sibility. There is one thing no man can invent, and that is a form of society in which the rights, whether of the rich or of the poor, shall not be accompanied by corresponding duties. He who treats these economic problems without taking the moral and ethical side of life into consid- eration may rightly be called a representative of " a dismal science." But it by no means follows that we must seek to reconstruct humanity in our effort to form society. The subject of economic science is man as he now is, with all his faults, his selfishness, and his failings. It was said of old time that " surely the wrath of man shall praise thee." Might not the prophet of the present affirm with equal insight : *' The power which makes for righteousness compels not only the enlightened self-interest of man, but his very selfishness, to work out the progress of humanity ? " The commerce of the world now turns from one side of the globe to the other on a margin of a cent on a bushel of grain, a dollar a ton of metal, a quarter of a cent a yard on a textile fabric, or the sixteenth of a cent a pound on sugar. The cube of coal, as I have before stated, which would pass through the rim of a quarter of a dollar, when used Law Prices, High Wages, Small Profits. 131 in connection with the compound engine, will drive a ton of food and its proportion of the steamship two miles on its way from the producer to the consumer ; by the invention of the triple compound, one fourth even of this fuel has been saved. The profit or loss of this great nation turns on the price of a daily glass of lager beer. When this article is read, five cents a day, more or less, to each in- habitant of the country, will represent $1,095,000,000 worth of prod- uct, which may be either saved or wasted according to the measure of the intelligence of each person. The profit which might be repre- sented by this sum of money may be diminished one half by the igno- rance of legislators who take no cognizance of the facts of life when framing the statutes by which they undertake to regulate and control an organism which yet makes its way steadily onward with greater or less effort, whatever may be the system of laws by which its progress is either helped or hindered. These computations are submitted for what they are worth. They are probably as near to the facts as it would be in the power of any private student to bring them, whose opportunity for study or for treating these questions is very limited. In the attempt to comprehend the laws of social science by reading and studying treatises upon political economy, the writer long since met the difficulty which would be apt to occur to a business man, — to wit, the necessity for a statement of accounts and a trial balance. In the attempt to make such a statement and to balance the accounts of one class with another, and of one branch of industry with another, he has himself come to certain conclusions which coincide very closely with the modern teaching of political science. The science of life does not consist in laissez faire, or letting alone. There are many objects which may be better attained by the state, town, or city undertaking them than they could if left to individual or corporate enterprise. There are many others which it is often pro- posed to have the state assume, which are utterly beyond the functions of the state in its corporate capacity^to manage. Among the prime factors which make or mar material prosperity there are grave differences. The conclusion of the writer is, like that of all the economists whose works have any standing among men, that tampering with, or debasing the standard of value is the most malig- nant fraud which the government can perpetrate. The cost of substitut- ing paper notes for true money under the stress of war added without question to the cost of the civil war as much as the whole sum of out- standing debt yet unpaid. The most beneficent factor in the lowering of prices and in raising wages has been the extension of the railway system and the reduction in the charge for the service. Vanderbilt 132 The Industrial Progress of the Nation. was the typical railroad man of his day; he was also the great com^ munist of his time, because he reduced the cost of removing a barrel of flour a thousand miles to so small a sum that it can hardly be meas- ured in a loaf of bread, at a margin of profit to himself and his asso- ciates which is now less than the value of the empty barrel at the end of the line. The heavy taxes which we are now paying are but a slight burden upon the people ; so long as they can be applied to the pay- ment of the public debt, they may be justified, however unscientifically and injudiciously the acts for collecting them may be framed. EXAMPLES OF REDUCTIONS IN PRICE— REDUCTION IN COST OF LABOR— RISE IN RATE OF WAGES AND INCREASE IN PURCHASING POWER OF WAGES. Standard Cotton Sheeting. Year. i860 1865 1870 1875 1880 1885 Price per yard. 8.17 cts 50.61 14-33 9-79 7.40 6-55 Cost of labor per yard. 0.095 cts 1. 501 1-425 I-314 0.093 0-095 Earnings per year. Purchasing power in food, cloth, and fuel. $207.00 234.00 275.00 280.00 260.00 284.00 669 420 632 721 782 IOI4 Suit of Furniture for a Bedroom. Year. i860 1865 1870 1875 1880 Price per suit. $35.00 55-00 33-00 28.00 20.00 Cost of labor Earnings. $12.00 $456.00 18.00 678.00 11.00 687.00 10.00 723.00 8.00 723.00 Purchasing power in food, cloth, and fuel. 1473 121'; 1578 1868 2175 One Dozen Steel Axes, Day Wage, Rations Food only per Day. Year. i860 1865 1870 1875 1880 Price. Cost of labor $11.00 20.50 14-50 11.50 8.50 $2.28 3-12 2.93 2.46 2.04 Day's wage. Rations food only. $1.70 2.27 2-35 2.17 2.26 6.25 5-39 6.41 6.00 8.76 In this example the prices of food in the same county have been computed as a standard. A Horse-rake. Year. Price. Cost of labor Day's wage. Rations food only. 1865 1870 1875 1880 $35.00 32.00 28.00 24.00 $3-36 2.87 2.53 2.10 $1-93 2.12 1.90 1.76 4-53 5-54 5-92 7.01 ' Compiled from Vol. XX. U. S. Census by Joseph D. Weeks ; computed by Edward Atkinson, and verified by comparison with other authorities. Could sp.icc be spared, examples of the same kind could be added from almost every indus- try to which modern machinery has been applied, but these must suffice. Low Prices, High Wages, Small Profits. 133 Whatever may be the opinions or theories of each reader upon these various problems upon which every voter in a free country must pass whether he will or no, it is held that there can be no true solution unless it is based upon facts. It has been the purpose of the writer in this series of Century articles to give these facts rather than to present his own theories ; to ask questions rather than to attempt to answer them. It may be suitable to submit a very few examples, which will be found on the preceding page, proving how the rule of diminishing prices, decreasing profits, and diminishing cost of labor has been consistent with the general rise in the rates of wages and in their purchasing power. This principle would of necessity be deduced from all the tables which have already been submitted ; but a few specific examples may be a mat- ter of curious interest, and will fully sustain it. THE DISTRIBUTION OF PRODUCTS THE DISTRIBUTION OF PRODUCTS. I. HOW CAN WAGES BE INCREASED? " AS my book upon " The Distribution of Products," which consists mainly of an essay on '' What Makes the Rate of Wages ? " is now passing to its fourth edition, and is attaining a wide circulation, I am very glad to find it reviewed by Mr. Frederick B. Hawley, in the Quarterly yournal of Economics for April, 1888, published for Harvard University. If there are any important errors either in the theory or in the figures which are presented in this essay, I greatly de- sire to correct them. From this review and from some previous notices of the book I have been led to believe that I have not made the rea- sons for my conclusions as plain as I might have ; I therefore beg to repeat the main propositions which I have attempted to sustain, and to give more conclusive proofs, if I may do so, that these propositions are correct. The fundamental idea of the book is as follows : the annual prod- uct, or the product of each series of four seasons, is, and must be in the nature of things, the source of all rents, profits, interest, wages, salaries, and earnings. This product is the result of the joint appli- cation of labor and capital. It therefore follows : I. That in this product, or in its distribution or consumption, all persons take some part who are engaged in gainful occupations, num- bering in the census of 1880 a fraction less than one in three of the population, and listed under the respective heads of professional and personal service, trade and transportation, manufacturing, mechanical, and mining pursuits, and agriculture. By far the larger proportion of each of these classes is now, and must continue to be, either in the po- sition of small farmers, who work harder than their hired men and who outnumber the hired men engaged in agriculture, or of wage-earners, or of persons who are in receipt of small salaries ; nearly all, with the exception of the farmers, are in the position of the employed rather than of the employer. The gains or savings of these working classes, which may be added to the capital of the country, amount to a large ' Reprinted from the Forum. 137 138 The Indzistrial Progress of the Nation. sum in the aggregate ; but, with few exceptions, they are small in amount in each individual case. The lives of the great majority are mainly spent in getting a living. 2. These " working classes," so called, constituting by far the great- est proportion of all who are occupied for gain, now secure for their own use and consumption substantially ninety per cent, of the total annual product of this country ; consequently, that part of the annual product which is, or can be, in an average year, secured by capital for its service, whether the capital be owned by the rich, the well-to-do, or in part by the wage-earners themselves, cannot exceed ten per cent, on the average. This is the increment which can be set aside for the maintenance and increase of the capital of the nation. 3. The working classes, making use of that term not in the broader but in the narrowest sense in which it is customarily applied, have been, and are still, securing, for their own use and enjoyment, for con- sumption or savings, decade by decade, subject to temporary fluctua- tions in each ten years, an increasing share of a constantly increasing product or its equivalent in money, and will continue to do so as long as the competitive system is the rule in commerce, in production, and in distribution. 4. Under the relatively free conditions of society in this country as compared to all others, the members of the three classes, /. e., the so-called working classes, the well-to-do, and the rich, are constantly changing in their respective conditions. On the one hand, the pros- perous classes are constantly receiving recruits from the working class ; on the other hand, as has been well said, " it is rarely more than three generations from shirt-sleeves to shirt-sleeves." No one could have been more surprised than myself when these conclusions developed themselves from the facts of life. I have but little time for the reading of books, and I am not aware that the attempt has been made by any one else to measure the proportions which may be assigned to each class in the community by first computing the sub- ject of the division, /'. e., the annual product at its final measure in money when disposed of for final consumption. It may be that this method is one which cannot be applied with sufficient certainty to justify the conclusion ; of that each one must judge for himself as my processes are developed. Many exceptions have been taken to these proportions in the divi- sion of the annual product, but they have usually been, on the whole, of a somewhat superficial character, like the review to which I now propose to make a rejoinder ; they assume that I have intended to state that the proportion of the annual product which falls in the first process of distribution to capitalists, landlords, manufacturers, and men of business, in the form of rents, profits, or interest, is the same How Ca?t Wages be Increased f r 39 in amount and proportion as that which constitutes the net profit or savings of the nation as a whole, which can be applied to the main- tenance or increase of the capital of the nation. I am probably my- self responsible for this confusion of thought, by my want of clearness and precision in the preparation of a treatise which was dictated in the intervals of a very busy life, and published without that careful revision which was due to the importance of the question which I have treated under the title, " What Makes the Rate of Wages ? " I may not have discriminated sufficiently between the income of individuals and the net profit or savings of the nation. I therefore take the op- portunity offered me by my critic to present anew some of the reasons which led me to the conclusions given as to the relative shares of labor and capital in the annual product. On one point I fully agree, to wit : if the workmen or laborers, or if the classes consisting of laborers, receivers of small salaries, small farmers, and the like, who now constitute the great majority of the community, do now actually obtain for their own use and consumption ninety per cent, of the gross annual product, then there is little mar- gin for improvement in their condition except through an increase of the product itself. Or if, as the reviewer says, "the complete success of co-operation combined with nationalization of land or with the establishment of an ideally perfect system of socialism would augment laborers' incomes within the limit of only eleven per cent., and that only provided as much were produced under the new conditions as under the old, then such a percentage of gain would be wholly insufficient to raise the recipients' wages to any condition mate- rially superior to their present one." That is the very conclusion to which my own mind has been brought by my special investigations and by the observation of some curious facts. For instance, in a recent strike, in which a very large number of men were engaged in a special employment whose earnings averaged $500 a year, I found that, had they secured for their own enjoy- ment the entire profit of the business at the time of the strike, it would have increased their wages but five per cent, or $25 per year. It was an art in which the capital required was very small in proportion to the annual product. The strike failed, and the business continued as before. The reviewer alleges that the proposition that ninety per cent, of the product is gained by those who do the work of life, and only ten per cent, goes to capital, " is so evidently false as to constitute a re- ductio ad absurdum." If he would enter upon the line of investigation which I have followed, without any a /r/f production. Both these hypotheses rest upon the so-called law of diminishing returns from land, under which it is held that land may fail to yield an equal increment of product in ratio to equal increments of labor and capital expended upon it. If these hypotheses are pushed to their logical conclusion, and if there is no countervailing force which may ultimately bring land and life, or population and produc- tion to an equilibrium, does it not of necessity follow that all our humanitarian or philanthropic efforts may only make the final catas- troi)he so much the greater ? Admitting that a century or less is quite insufficient to warrant absolute inductions from experience, yet it may well be considered that there has not been a single decade, since the hypothesis of Malthus was first presented, in which the means of subsistence have not gained very rapidly upon the population of the world. Mtist Humanity Starve at Last ? 157 What are the facts with respect to the hypothesis regarding rent presented by Ricardo ? First. Experience proves that a given and limited area of land of high fertility, when cultivated for a series of years in a certain manner, will doubtless yield diminishing returns in proportion to the amount of labor and capital expended upon it. Such land may finally cease to yield a profit sufficient to pay the cost of cultivating it, in which case there can be no economic rent, and the land may for a time go out of cultivation, until the pressure of population reduces the stand- ard of living to such an extent as again to compel its cultivation even, for the most meagre returns. Such is the fact in regard to consider- able areas of land in England to-day. The present condition of Great Britain, under the system of large entailed estates which have been cultivated for a comparatively short historic period to the present time, mainly by tenant-farmers under leases which prevent free use, gives one example of the failure of land to yield adequate returns for the kind of labor and the method of directing the capital expended upon it. The failure may not happen for lack of abundant product, but because the product is of high cost and not suitable to present conditions. It does not follow that some other method would not yield adequate returns. Again, the present condition of many parts of the continent of Europe under the system of forced subdivision of land, by which the parcels have become too small for application of machinery to them, affords another example of the limited truth of the hypothesis of diminishing returns. But both in Great Britain and on the Continent examples may be found of such exceptions to this supposed law as to invalidate the rule ; while, again, the whole area in which this alleged rule appar- ently finds limited support constitutes so small a fraction of the surface of the earth as to make any deduction from the results obtained from it a mere exception, or else a result attained under such exceptional conditions as to be of no force whatever in sustaining a universal law supposed to cover general production. Secondly. A given area of land of high fertility may be divided into parts by a line. On one side the cultivation may be carried on as in the foregoing examples, and the land may be finally exhausted, so far as that kind of cultivation is concerned. On the other side of the land of the same quality, treated by different men, or by a suc- cession of men of a different or more intelligent type, or working under better institutions, may yield a larger and larger product through a period of at least a century. This has been proved in the history of this country. A fair example may perhaps be found in the relative conditions of the central part of the State of New York, as compared to some of the more fertile portions of the land of Lower 158 The Industrial Pi^ogress of the Nation. Canada inhabited by the French population. In the one case a steadily increasing product may be found in proportion to the capital and labor ; in the other, diminishing returns in ratio to population, accompanied by the forced migration of the French habitans. Land of the same original quality, in the same field, divided only by a line, may, therefore, on the one hand, prove the law of diminishing returns and may be cited as an example of the entire loss of economic rent ; while on the other side of the line, under a better mode of treatment, a law of increasing returns and of higher rent may be proved. Of course there may or must be a final limit, and by admit- ting a final limit it may be held that the hypothesis of Malthus is so far justified ; perhaps, however, at so remote a period as not to be entitled to present consideration, if ever. Thirdly. It may be asked, Where is the man who can yet measure the potential of an acre of land anywhere, or where is there an acre of land of which it may be positively affirmed that it cannot yield a larger product than it has ever yet done, in ratio to the labor and capital which may be put upon it ? Who can say that there is not some other limit to the increase of population than the violent methods which have heretofore been held to be the principal retarding forces in the case ? May it not be held that the ^/r/^r/ concepts of Malthus in regard to population and of Ricardo in respect to rent are, to say the least, not yet proven ? No man can venture to define the point at which the equilibrium between life and land or between population and pro- duction may be destroyed, or the utmost limit at which it can be maintained ; for the reason that no one can yet venture to limit the applications of science and invention to the subsistence of man. It is not necessary to assume that there must be artificial restrictions upon the increase of population. Just as the most grasping and penurious money-getter iiccumulates capital and applies it to uses benefiting the community, while he costs only what he himself consumes, working almost automatically and without any knowledge of his own functions or utility in the social order, and thus becoming a conservator of the force of capital, so may there be laws for the conservation of that form of force which constitutes human life of which science has as yet no comprehension. Land itself may be exhausted when treated as a mine ; it may be maintained when worked as a laboratory. Its potential in the increase of fertility and production, when used as a tool or in- strument for diverting nitrogen and carbon from the atmosphere and converting these elements into food for man and beast, is as yet an unknown quantity. In support of these views, and in answer to the question whether the soil is not to be considered as a laboratory rather than as a mine, I am permitted to give the following extract from a letter by Prof. W. O. Must Humanity Starve at Last ? 159 Atwater, than whom no one has done more excellent work in develop- ing the resources of fertility, or in the application of science to the use of land as an instrument of production : " It is right to consider the soil as a laboratory and not as a mine, responding in just proportion to the intelligence and work put upon it. Of course there is a limit to the possible production, but it transcends all ideas that ever occurred to people in Malthus' time. The soil is the place of growth of the plant and the source of part of its food. Given plenty of water and food and proper temperature, and the amount of produce in a given area is immense. Professor Nobbe, a German experimenter, raised a single plant of buckwheat eight feet high and bearing nearly eight hundred perfect seeds, and this not in sand at all, but in water containing proper plant-food. Similar results are obtained with other plants. Our common ideas of area and soil-product are based upon the experience in which the factors promised in future progress are left out of account. The pcjsible production of a given area is far outside our usual calculations. " The problem of the world's future supply is conditioned upon two things : one is energy, power for manufacture and transport of plant-food, and transport of water ; the other is the supply of nitrogen. With the unmeasured energy of wind, flowing water, and tide, and the possibility of storage, transfer, and use of energy by electricity and other agencies, we may hope that the science of the future will provide the power. Late research makes an abundant nitrogen supply probable. Leaving out of account the question of present pecuniary cost and profit, the conditions of transport of plant- food, cultivation of soil, and water-supply for the maximum production are theoretically capable of being provided. Science and discovery have already found in the earth practically inexhaustible stores of all the ingredients of plant-food but carbon and nitrogen. The atmosphere supplies an abundance of carbon to plants from its con- stantly replenished store of carbonic acid. This reduces the problem of ultimate supply of plant-food to one of nitrogen supply. Four fifths of the air are nitrogen, but the question is whether this can be made available to plants. For a number of years the current doctrine has been that it cannot, but late experiments indicate that certain plants do have the power of assimilating atmospheric nitrogen in large quantities. Aside from investigations in this country (my own of which you already know), a num- ber have lately been made in France, and particularly in Germany, which bring the most direct and convincing evidence that legumes, including, probably, clover, have this power of obtaining nitrogen from the air. It will interest you \ .rsonally to know that we are just commencing a new series of experiments here on this subject, with pea, alfalfa, cow-pea, clover, maize, and other plants. . . . Viewed from this standpoint, the prospect for the future of the race is not one of Malthusian dreadful- ness, but full of exalting inspiration." The a priori objection to which the hypotheses of both Malthus and Ricardo are subjected in my own mind is, that they tend to promote a contest between labor and capital ; to antagonism between the haves and the have-nots ; to ultimate destruction rather than to the conser- vation of life ; and they lead to the conclusion that the struggle for life must inevitably become more difficult and more violent, and must inevitably fail. In all problems in what is called political economy, which are commonly regarded as relating wholly to the production and distribu- tion of the material substances constituting wealth or necessary to 1 60 The Industrial Progress of the Nation. material existence, one is inevitably brought back to the immaterial or metaphysical. The mind of man when applied to the direction of natural forces is the principal agent in material production, in fact, the controlling element. Those who claim that labor is the source of all production are utterly misled because they do not admit this funda- mental principle. May it not, therefore, be more consistent with the concepts of an enlightened faith of any type in which order is recog- nized in the universe, to present an hypothesis or a priori theory that, as the mental faculties of man are more developed and are more intelligently applied to the conversion of the forces of nature into material products, the general struggle for life will become less and not greater ? War, pestilence, and famine have devastated the world and have diminished the means of subsistence, during the last two centuries, far more than they have rendered the subsistence of the remaining popula- tion, whose increase has been retarded by them, more easy and adequate. On the other hand, where peace and order have reigned production has been increased, and the interdependence of men has been more fully acknowledged. As it has become more and more fully admitted in political science that each man, each race, each state, each nation serves the other by exchange, the pressure of want has been diminished, and one can dimly foresee the time when the prophecy of the poet may become a living truth, when " Down the dark future, through long generations, The echoing sounds of war grow fainter and then cease." Have the orthodox English economists since Adam Smith ever overcome the insular quality of their work, or sufficiently counted upon the mind of man as a factor in material production ? Perhaps these questions would occur only to one who has studied economic problems by the observation of the facts of life rather than in the treatises on which our economic reasoning has heretofore been based. Is it not desirable that more attention should be given to the method of Adam Smith than to the dogmas of Malthus, Ricardo, and Mill ? If so, then the facts which are now being gathered by statisticians, especially in this country, may hereafter serve to give a broad extension of the narrow and insular habits of thought which the students of political economy have derived mainly from English writers. Let it not be supposed for an instant that I assume that there can be an American system of political economy as distinguished from an English system. Such a conception would be utterly inconsistent with any true idea of science. Yet, is it not true that habits of thought are unconsciously controlled by the environment of the writer "i Witness the broad extension of the English commercial system and the very narrow and Must Humanity Starve at Last ? 1 6 1 limited view which still obtains in respect to the local institutions of Great Britain. Witness the incapacity of Parliament to conduct a centralized system of government, especially in respect to Ireland, while the members of Parliament appear to be equally incapable of grasping the idea of home rule and local self-government under the central sustaining power of a great nation. On the other hand, have not the people of the United States devel- oped the broadest system of mutual service and support in respect to their internal commerce and the conduct of their home affairs ? home rule and local self-government being maintained in the strictest sense, backed by the whole power of the nation ; while the ideas of the people as well as of their legislators are distinctly provincial and limited in all that relates to the great commerce among nations. When the day dawns in which the English-speaking peoples of the world may become united under a system which shall give to every man the utmost liberty consistent with the rights of his fellow-men ; when national prejudice is abated, and the whole great body moves onward in its effort to benefit the people of the world by mutual service, the word will then go forth to all other nations. Disarm or starve. The Statue of Liberty which stands at the mouth of the great harbor of our country may then, in truth, enlighten the world. This is the vision which lies back of the dry columns of figures, and which brings the imagination into play on the part of him who can read between their lines. I venture to believe that although the province of statistical science has been held subordinate to that of political economy or political science, it may yet become of paramount importance to the develop- ment of either branch of study. Doubtful as statistics may be, much as they depend on the sincerity of purpose and integrity of him who compiles them, and easy as it is for them to become twisted and confused, even by the unconscious bias of the observer or compiler, they may yet become a necessary foundation for any true inductive method in political economy, and must, therefore, be placed on an even plane, to say the least, in the estimation of the student. For this reason it might well be that travelling scholarships should be established in universities as prizes in the department of political economy, in order that wider and more accurate investigations may be entered upon, whereby the <5!//V(?;7 concepts of most of the writers of the text-books may be tested, and may be either sustained or put aside, as they are found to be consistent or otherwise with the facts of human life. The real man can be observed ; has the economic man, who would bring into action all the processes conceived by writers of the type of Ricardo and Mill, yet been discovered ? Is he not also an hypothesis ? It would, of course, be futile to attempt to do more than II 1 62 The Industrial Progress of the A^ation. to present the elements of this problem within the limits of a short essay ; but it ought now to be observed that most of the causes of antagonism between labor and capital, as well as the basis of most of the undertakings of the socialist, the anarchist, and the communist, find their justification in one or the other of the hypotheses of Malthus or Ricardo. The abstract nature of the concepts of political economy may perhaps be more fully comprehended by a consideration of the deplorable results which have ensued from the general adoption of false theories in respect to trade. The folly of the mercantile system attained its most pernicious result in the attempt of Great Britain to control the trade of the colonies of America for the supposed exclusive benefit of her own people. Had the " Wealth of Nations " been written fifty years earlier, and had it attained the influence in 1760 which it began to attain in 1824, under the lead of Huskisson, there might have been no violent separation of the colonies of America from the mother country. The so-called '' iron law of wages " developed by Lasalle and Carl Marx, under which it is assumed that the rate of wages will be kept down to the limits of a meagre subsistence, is accepted by the anar- chists and communists of Europe and their few representatives in this country. It is an absolute fallacy except in dynastic states overbur- dened with armies and debts. The misconceptions of fact in respect to the progress from poverty, on the part of the great body of working people in this country, and the acceptance of Ricardo's theory of rent, lie at the foundation of the fallacious reasoning of Henry George respecting the private ownership of land ; and so one might go on throughout the list of misconceptions in regard to abstract theories or hypotheses which have been the occasion of more wars and greater misery than all other causes of violence combined, not even excepting the conflict of creeds. If the function of government were admitted to be to give each man an equal opportunity to make use of the benefits which science and invention place at his disposal, and to do, through the intervention of government, only such actual work as can be done by society in its corporate capacity better than individuals can do it for themselves, most of the obstructions which legislation has placed in the way of mutual service would soon be removed, and the true law of human ])rogress would then develop itself. Wages would then increase to the maximum within the limit of a product attained under the most favorable conditions. in. PROGRESS FROM POVERTY.' THE purpose of the present article is to bring once more into notice certain facts which the writer has given in other publica- tions, which are not only wholly inconsistent with the hypothe- ses of Malthus and Ricardo, but which must be disproved by Henry George and other writers of his class, who attribute the admitted poverty that is to be found in the worst quarters of our great cities wholly to faults in the government and in the laws, before their empiri- cal methods of abolishing poverty can be entitled to any serious con- sideration. In recent discussions these statements have been cited as authoritative alike by the advocates of free trade and of protection, of paper money, of the single gold standard, and of the limited coinage of silver. As yet no one has contested the substantial accuracy of the conclusions which I have drawn from these data. The only exception taken to them has been that they are partial and limited and have not covered as wide a field as they ought. In presenting them I have myself always said that they might be incomplete, and that their pur- pose was rather to give a direction to the line of future investigation than to present conclusions. That direction has been given in the establishment of the National Bureau of Labor Statistics, and in the resolutions which have been passed by Congress instructing its officers how to proceed in their inquiries. Of their sufficiency each student must judge for himself. It has long been apparent that the circulation of a depreciated promise of the government, issued in time of war for the collection of a forced loan, as well as the pressure of the war itself in its effect upon prices, had vitiated all deductions by which the condition of men at one period as compared to another could be determined. No true comparison of conditions can be made in terms of money, when the money itself varies in value ; therefore some other standard must be adopted in order that just conclusions may be reached in regard to these relative conditions. The mere rate of wages, given in terms of money, has proved to be as fallacious a standard by which to measure * Reprinted from the Forum. 163 1 64 The Inihistrial Pi'ogress of the Nation. the relative conditions of working people in this country during the last twenty-five years, as it now is when made use of for comparing the conditions of workmen in this country with those of other countries. The rate of wages in itself constitutes no standard whatever for the comparison of conditions, even when the same money standard is in force, because the cost of labor cannot be determined by a mere comparison of price or rate of wages. I have therefore endeavored to establish a multiple standard for the comparison of the relative condi- tions of workmen and capitalists in this country at different dates during the last twenty-five years. This multiple standard consists of equal quantities of the same kinds of food, fuel, and materials for clothing, corresponding to the average daily consumption of an adult workman in the Eastern or Middle States. I first entered upon the investigation of the statistics of the con- sumption of food by quantity. I ascertained the average quantity and cost of each of the different elements of food consumed in the factory boarding-houses of New England and of the Middle States, such sup- plies being usually purchased with due economy and used with fair regard to preventing waste. Having established this food standard, measures were next taken to bring the subject to the attention of the Chief of the Bureau of Labor Statistics in Massachusetts, Commis- sioner Carroll D. Wright, and at a later period of the Chiefs of the Bureaus of other States. The result of these various investigations has been that the average ration or portion of food such as actually constitutes the daily supply of an average artisan, mechanic, or other workman, has been well established in all its elements. It varies a little in different parts of the country according to the relative con- ditions. This average daily ration was next submitted to Professor W. O. Atwater for analysis. The respective proportions of the nutrients, so-called, /. e., of starch, fat, and protein or nitrogenous material, were found to be much above the normal standard of good subsistence. The elements of this average daily ration are given in a subsequent table. I next computed the average annual consumption of the materials for clothing, of boots and shoes, and of fuel. Having reached a certain standard in yards and quantity, I multiplied this standard by the population of 1880, counting two children of ten years or under as one adult, and found that the result of this computation more than exhausted the entire product and import of textile fabrics and other necessities of Hfe treated in that year. The proportion assigned would, however, be warranted by the conditions of life in the Northern and Middle States as compared to the Southern or extreme Western States. I next attempted to establisli a unit of rent or shelter, but the con- ditions in different parts of the country were found to be so variable as to make this attempt impracticable. It became apparent, however, Progress and Poverty. 1 65 that tlie standard of rent or cost of the dwelling-places occupied by working people had varied since i860 in substantially the same pro- portion as the cost of the materials for food, for fuel, and for clothing. The proportions of these elements of life, namely, food, fuel, and materials for clothing, which are assigned to a day's or a year's supply in the subsequent table, corresponding to the average consumption in the Eastern and Middle States, are doubtless above the average con- sumption of the whole country, especially in respect to tea, coffee, and sugar ; but although such is the fact, and although the actual consump- tion of food, clothing, and fuel may not in any single case have corresponded identically with this multiple standard, yet it may be safely assumed that as the prices of the necessities of life which are included in this standard have varied, so have the prices of the actual quantities consumed also varied. It may also be remarked that in the northern parts of this country the price paid for the materials for food amounts to about one half the annual expenditure in the family of an average workman ; in the family of the common laborer the price of food is more than one half the annual expenditure. If to the cost of food be added the price of fuel and materials for clothing, then the several elements included in the multiple standard correspond substantially to about seventy per cent, of the total cost of living in the family of an average workman. If it be admitted that as the cost to the workman of these necessities of life has varied, so has the cost or price of rent or shelter and sundries varied, we then have in this multiple standard a fair gauge by which to test the variation in the purchasing power of paper money as compared to specie at different periods, and also the purchasing power of a day's or a year's earnings in time of peace or war, or under the changing conditions which were first brought about by the depreciation of paper money and subsequently repeated during the long struggle for the restoration of the specie standard. I had made great progress in providing data for this multiple standard before the publication of the twentieth volume of the United States Census on Prices and Wages, compiled by Mr. Joseph D. Weeks ; I was therefore in a po|ition to make use of this volume and to check off the data contained in it. I could verify many of the tables from my own knowledge of the facts governing many of the establishments named therein. It is also plain to any one vvho is accustomed to the examination of statistics that very many of the returns in this volume are correct, while a few testify to want of care in their compilation. The latter may be readily set aside. I was also in a position to add to the data of this volume, which came down only to 18S0, inclusive, corresponding figures for the years 1885 and 1886, derived of course from a much narrower circle of establishments. 1 66 The Industrial Progress of the Nation. In making selections from this volume for the comparison of the purchasing power of wages by the use of the multiple standard, I have selected arts or occupations which have been in substantially continu- ous operation during the whole period under consideration, that is, subject to very few stops or none. I am aware that the adverse com- ment on this method will be that during this period, since i860, there has been greater variation in the supply of and demand for labor than at previous dates or periods of economic history. Such stupendous changes could not have occurred in a single generation without giving some support to this criticism. Space will not permit me to treat this branch of the subject ; suffice it to say that my own observation has led me to the conclusion that in each period of commercial panic, namely, 1866, 1873, and for a few years of alleged depression subse- quent thereto, as well as in the recent period of alleged depression, from 1881 to 1886, the number of the unemployed has been very much exaggerated. In my judgment, compulsory idleness has hardly existed at all, except in connection with the alternate periods of cessation and of great activity in the construction of railways, and has mainly affected the workmen employed in that branch of industry, reacting of course in a limited measure upon others. It may also be apparent from the data that I have submitted, that this period of steady reduction in prices since the end of the Civil War has been in fact a period of the greatest progress in material welfare ever witnessed in this or in any other country. The temporary diffi- culties, local distress, and congestion of labor, limited mainly to some of our great cities, have been mere incidents in the adjustment of society to new conditions of an assured abundance such as were never before achieved. It has happened that there has been temporary want in the midst of general plenty and welfare ; but this want has been limited to a very few conspicuous points, where it has perhaps attracted more attention than its porportion called for. With this explanation I submit the subsequent diagram or object lesson (page 170) in illustration of the various changes which have occurred in the relations of labor and capital since i860, first giving the elements of the multiple standard. In 1887 prices fell a little lower than in 1886, and in 1888 they have begun to rise in some small measure, while there has been no substan- tial variation in general wages since 1885. A decline has occurred in a few arts, mainly those which are dependent on railway construction, but there has been a moderate advance, or tendency to advance, in other directions. It is commonly assumed, and may be admitted, that wages in agriculture exert a powerful influence upon those in other departments, and that farm labor may be taken as a standard. In the last official report of the Department of Agriculture, No. 51, May,. Progress aiid Poverty. 167 1888, Mr. J. R. Dodge, the Statistician of the Department, says that " the result of the May investigation of the wages of farm labor is almost identical with that of three years ago ; the changes are very slight, though local differences occur, the averages of several sections or groups of States being changed very little." MULTIPLE STANDARD. Table A. — A Single Day's Ration, with its Average Cost in 1880, 1881, ani> 1882. Table B. — 400 Rations, or i Year's Supply for i Adult with 35 Extra Rations. It is assumed that the prices of meat and fish (fresh or salt) and poultry, will have varied substantially with the variations in salt and smoked meats, and as the prices of the latter are more uniformly quoted, the prices used in making up the general standard are those given for salt and smoked meats. In the same way the price of potatoes has been taken as a standard for the variation in the price of all green vegetable food or roots. A.— One Ration per Day. B.— 400 Rations. ^ to I lb. meat, poultry or fish, 200 lbs. corned beef. varying according to kind and lOO lbs. salt pork. quality, costing on an average. 10 loo lbs. smoked ham. % io y^ pint milk ) loo quarts milk. I to I "^ oz. butter - 5 30 lbs. butter. ^ to ^ oz. cheese ) 2o lbs. cheese. I egg every other day % 17 doz. eggs. ^ to I lb. bread 2% i barrel flour. JS^ barrel corn meal. Vegetables and roots 2 @ 2^ 20 bushels potatoes. Sugar and syrup 2 80 lbs. sugar. Tea and coffee i 4 lbs. tea. 8 lbs coffee. Salt, spice, fruit, ice, and sundries 1% @ 2 $6 worth assumed at all dates. 25 cts. $100 STANDARD PORTION OF CLOTH FOR ONE YEAR : 10 yards medium brown cotton. 10 1 1 standard gingham. 10 1 1 36. in. bleached shirting. 20 1 1 printed calico. 10 ( i 4-0Z woolen flannel, or worsted dress goods. s t 16-0Z. cassimere. 5 i I Kentucky jean, satinet, or light cassimere. STANDARD OF BOOTS AND SHOES FOR ONE YEAR : 2 pairs men's heavy boots. STANDARD OF FUEL FOR ONE YEAR : l}4. tons anthracite coal or its equiva- lent in bituminous coal or wood. In establishing the average cost of a day's portion of the above, the prices given in Vol. XX. of the U. S. Census, in 10 shops east and 10 shops west of Buffalo, 1860- 1880, have been averaged for each year designated. These prices have been verified from other sources of information. Prices of dry goods have been verified fully. Prices for 1885 and '86 have been derived from typical establishments and from market reports. The average prices of 1885 and '86 were probably less than the estimate used. 1 68 The Indust7Hal Progress of the Nation. The following table presents the sectional averages from 1866 to 1888. It will be observed that from 1866 to 1879 wages were rated in depreciated paper money gradually approaching the specie standard, and that while wages were nominally less in rate after resumption, their purchasing power was much greater. See subsequent table : Sections- Eastern States Middle States Southern States. . . . Western States California Average U. S 1888. 188;. 1882. 1879. 1875. 1869. $26.03 23.11 14.54 22.22 38.08 $25.30 23.19 14-27 22.26 38-75 .$26.61 22.24 15-30 23.63 38-25 $20.21 19.69 13-31 20.38 41.00 $28.96 26.02 16.22 23.60 44.50 $32.08 28.02 17.21 27.01 46-38 18.24 17-97 18-94 16.42 19.87 1866. $33-30 30.07 16.00 28.91 35-75 Average Eastern, Mid-^ die, and Western | States, excluding \ 23.79 23.58 24.16 20.09 26.19 29.04 30.76 Southern States and I California J These are the wages per month of farm laborers hired by the year -without board, the workmen boarding themselves- The average of 1888 of the whole country, with board, is $12.36. The day wages in harvest time in 1888, without board, averaged $1.38 ; with board, $1.02. The day wages of ordinary farm labor other than harvest hands averaged, without board, $0.92 ; with board, $0.67. The aver- age of the whole country is, however, somewhat delusive, being greatly affected by the low rates of wages prevailing in the Southern States, especially among the negro population. If we take two States as ex- amples of agricultural communities devoted mainly to wheat and corn, for instance Minnesota and Iowa, we find the average wages per month of hands hired by the year in those States to have been, without board, in 1885, $25.40 ; in 1888, $25.67 ; with board, in 1885, $16.87 I in 1888, $17.41- In harvest time the day wages were as follows : Minnesota, in 1885, $2.29. " " 1888, 2.20. Iowa, . . " 1885, 2.00. " 1888, 1. 81. The urgency of the demand for labor in harvesting wheat is great- est in Minnesota, whereas in Iowa maize or Indian corn is the chief crop, on which the demand at harvest time is not so urgent. The day Avages of ordinary farm labor in Minnesota and Iowa, with board, were practically one dollar a day both in 1885 and 1888, and from $1.25 to ^1.30 without board. I now submit the rates of wages in the manufacturing and mechanic arts, compiled from the twentieth volume of the Census and from data gathered by myself for 1885 and 1886. Progress and Poverty. 1 69 Class I. — Specially Skilled Men : Foremen, Overseers, Boss Blacksmiths, Carpenters, etc. Customarily Earning $3.00x0 $5.00 per Day at the Present Time. Average per Year. Year. Average per Day. 300 days. i860 $2.45 $735-oo 1865 3.57 1071.00 1870 4.34 1302.00 1875 4.14 1242.00 1880 4. 14 1242.00 1885 ] Probably higher Uian in 1880. 1886 f ^ ^ •Class II. — Average Mechanics, Engineers, Blacksmiths, Carpenters, Machinists, and Painters Connected with Establishments Reported in Vol. XX. of the Census, 1865 TO 1880, Inclusive. Year. Average per Day. Average per Year. i860 $1.56 $468.00 1865 2.34 702.00 1870 2.43 747-00 1875 2.29 687.00 1880 2.26 678.00 1885 \ 2.40 720.00 1886 \ •Class III.— All the Operatives, except Foremen and Overseers, in 100 Establishments Reporting the Wages of their Working People under more than 1200 Separate Titles : Bricks, Marble, Furniture, Agricultural Implements, Tin-'ware, Stoves, Boots, Hats, Cars, Wagons, Flour and Saw Mills, Iron, Paper, and Textiles, Em- ploying Men, Women, and Children, from 20 to 2000 in Each. Year. Average per Day. Average per Year. i860 $1.33 $399.00 1865 1.88 564.00 1870 1.94 582.00 1875 1-77 531-00 1880 1. 71 513.00 1885 ) I 80 540.00 1886 \ Class IV. — Laborers, Computed Separately, Connected with above Establishments. Year. Average per Day. Average per Year. i860 $1.01 $303.00 1865 1.56 468.00 1870 1.58 474.00 1875 1.38 414.00 1880 1.34 402.00 1885 ) 140 420.00 1886 s Having thus determined the average rates of wages at different periods, it next became necessary to determine the retail prices of the various articles constituting the multiple standard. The method adopted is stated in the foregoing table. The cost of retail price to the consumers of a single portion or daily supply of the articles con- stituting this multiple standard, computed for equal quantities of the same kinds of food, fuel, and materials for clothing, has been as follows, the average of each year being given as stated from twenty returns, the average computed on twelve months' prices, month by month : 170 The Industrial Progress of the Nation. i860 $30y*xfu cents each portion. 1865 55tVu " 1870 43/A " 1875- 38x^17 1880 333^^*0 ■■ 1885 and 1886 30 For the latter years, 1885 and 18S6, having less adequate data than for the preceding years, I have adopted a maximum of thirty cents. In point of fact the average price combined of the respective articles was less than this, and probably did not exceed twenty-eight cents. In order that the true relation of these figures may be comprehended the accompanying diagram is submitted. Specie Paper Paper Paper 'Specie Specie I8CO 1865 1870 •1875 1880 1885-86 1860 1865 1870 1875 1880 1885-86 In this diagram the classes of workmen are indicated by the Roman numerals I., II., III., and IV. The number of portions which each year's earnings would buy is given on the vertical lines under the re- spective dates. The relative progress of each class of workmen is. Progress and Poverty. 1 7 1 indicated by the lines projected from left to right, I., II., III., and IV. The line indicated by the numeral V. gives the purchasing power of $100 of lawful money at the several dates in portions of the multiple standard. The line which passes diagonally from left to right, marked " Decline in rate of interest," indicates the loss in the purchasing power of capital. The line at the top, indicated by the Roman numerals VI., indicates the purchasing power of the income yielded by an investment of $10,000, at the respective dates. Let us now glance at the relative conditions of labor and capital disclosed by this diagram. The gain in the purchasing power of wages, measured by the mul- tiple standard of food, fuel, and cloth, has been from i860, as com- pared to 18S5 and 1886, as follows : Class 1 70 per cent. Class II 59 per cent. Class III 40 per cent. Class IV 43 per cent. The gain in 1885 and 1886, as compared to the year 1865, when paper money and war had exerted their utmost effect, was as follows : Class 1 108 per cent. Class II go per cent. Class III 78 per cent. Class IV 67 per cent. The line indicated by the numeral V. gives the purchasing power of one hundred dollars of lawful money, in specie in i860, in depre- ciated paper currency up to 1879, and again in specie in 1880, 1885, and 1886. In i860 one hundred dollars of coin would buy 323 por- tions of food, fuel, and materials for clothing. In 1865 one hundred nominal dollars of depreciated paper would purchase only 179 por- tions, a loss of 44 per cent, in the power of the money, which was partly compensated to workmen by a moderate advance in the rate of wages. In 1885 and 1886, one hundred dollars of coin would purchase Z'h2> portions at the estimate assumed by me, 30 cents per portion, but in fact, nearer 350 portions of the same kinds and quantities of the necessaries of life at a somewhat less price, say at 28 cents. The line sloping diagonally from left to right shows the reduction in the earning power of capital as demonstrated by the fall in the rate of interest on the best classes of securities. From 1848 to i860 the writer kept a record of transactions by himself or by his associates in manufacturing corporations. The average rate of discount paid in the open market by the corporations enjoying the highest credit during this period was eight per cent., subject to very considerable fluctuations. From i860 to 1869, inclu- sive, the rates of discount varied greatly with the circumstances of each case. The war and the continued issue of legal-tender notes rendered any standard of little moment. Railway corporations issued bonds at long dates, at rates of interest from 7 to 8 per 172 The Industj'ial Progress of llic Nation. cent., but there was little recourse to credit in ordinary transac- tions. Commercial paper wholly disappeared and all traffic in goods assumed the nature of barter, no one holding money longer than was necessary. In 1870 the slow restoration of specie payment began. Up to 1873, the year of panic, the rate of interest on the best manu- facturing notes was on the average six and one half per cent. After the panic of 1873 ended, up to the ist of January, 1879, five per cent, was the average rate. Since the restoration of the specie standard at the latter date, down to the present time, the fluctuations in the rate of discount on the very best commercial notes have been from 3 to 5 per cent. ; by the actual record of a broker doing a very large business, they have averaged 4 per cent, on 6 months' paper in this section of the East. By the kindness of Mr. Lyman J. Gage, of Chicago, I have ob- tained the rates of discount on commercial paper at that point. They are about the same in their proportion, having been reduced from an average of 10 per cent, or over, to an average of 5 per cent, or less, between the dates i860 and 1886. On Western farm mortgages the change has been much greater. Twenty-five years ago rates as high as 25 per cent, were paid on mortgages of Western land, on what has proved to be excellent security. The rate now charged is seven per cent, and even less. In order to determine the actual earning power of capital safely invested, it becomes necessary to combine the several factors : first, rate of interest ; secondly, income of a given sum at that rate ; thirdly, purchasing power in portions of the products included in the multiple standard. Assuming $10,000 invested, yielding the average rates of interest given above, we get the following results in the income and purchasing power : i860 Income $800 spent at SOf'A cents per portion . . . 2584 portions. 1865 $800 " " 55tV^ ... 1436 1870 $700 " " 43TVTf . . . 1603 " 1875 $600 " " SStVzt ... 1551 1880 $500 " " 33 A% ... 1 500 1885-86 " $400 ' ' " 30 ••• 1333 I have chosen Eastern rates rather than Western. In 1865 rates fluctuated greatly, but I assume no average change from i860. If capital could only secure by its income one half as many por- tions of food, fuel, and clothing in 1885 and 1886 as in i860, and if in the meantime the productive power of labor had become one third more effective, which is a moderate estimate, does it not follow that labor now secures the service of capital on better terms than ever be- fore ? I submit this problem in economic mathematics to the officers of the Anti-Poverty Society. Progress aiid Poverty. i 73 It is because these facts are consciously or unconsciously compre- hended, that the agitation of what is called the labor question affects but a small fraction or fringe of the working population, and that the special efforts of the leaders to change the relations of workmen and employers last so short a time and have such slight results. On the other hand, the more the workmen organize and discuss these problems, the more fully will the true relations of labor and capital become defined. Now, while I cannot claim positive accuracy for these formulae by which I have attempted to present the problem of distribution, I can feel well assured that the margins for error would balance each other, and that even if the figures are not absolutely true, the curves by which the relative condition of laborers and capitalists are indicated are so near to absolute truth as to make any error in detail of no apprecia- ble effect upon the general result. May it not therefore be held that, in a free and substantially homogeneous country like the United States, society adapts itself to whatever conditions may be brought iijto effect by war, by paper money, or by fiscal legislation ? In order that society in a broad sense may exist, the division of labor and the exchange of product for product or of service for ser- vice is an absolute necessity. In the distribution of products, in which the exchange of service mainly consists, there may be more or less friction. When the standard of value or money of the country is tampered with, there will be a greater margin of profit secured by capital as against labor, in order that capital may insure itself against loss from the depreciation of the money in which it is rated. Yet good or bad as the money may be, or costly, unscientific, and ill-ad- judged as the system of taxation may be, the discoveries of science and the labor-saving inventions applied to productive industry bring forth or produce, if they do not create, a huge abundance where scarcity had been the rule. Under the higher law which governs society, the direction of which can be but little changed by legislative interference, the benefit of this abundance is ultimately distributed, to the end that those who do the work of production and who are classed as working men and working women, secure to their own use an in- creasing share of a constantly increasing product. This product is divided among themselves in the exact proportion to which their rela- tive capacity and ability entitle them. On the other hand, the owners of ca'pital, or those who direct its force, secure to their use or enjoy- ment a diminishing share of this same constantly increasing product. Yet such has been the enormous gain of the last twenty-five years by the application of numerous inventions, that this smaller share of a vastly increasing product represents at this time a larger aggregate of wealth than was ever attained by any people of any country at any previous period of the history of the world. 174 ^^ Industrial Progress of the Nation. The prime factor in the progress of the people of the United States, toth in personal wealth and in general welfare, has been the develop- ment of the railway system. The service of the railways has continued to increase with great rapidity during the last two years, while the price of that service continues to be reduced. The twenty-six great systems of railway which centre in Chicago from east and west received in the last four years a little less than $640,000,000 for moving food, fuel, ma- terials for shelter, and clothing, at the rate of less than a cent (0.854c.) a ton a mile. The charge for the service of these same railways from 1866 to 1873 averaged 2.315 ; the reduction in the rate of the last four years has been 1.461 cents a ton a mile. Had the traffic for these four years been charged this difference, or been charged what was consid- ered a reasonable rate in the former period, the cost would have been $1,091,000,000 more than it actually was. The service of these trunk lines constitutes thirty-five per cent, of the whole railway service of the country ; the reduction in the railway charge on all lines has been as great or greater than on these (in all more than $3,200,000,000) for the last four years. While the mass of the people have thus gained in the aggregate more than $800,000,000 a year in the cost of distribution in recent years as compared to the period previously named, the construc- tion and operation of the railways have been the source of many of the phenomenal fortunes of recent years. Of some of these fortunes it may be truly said that every dollar which has been gained by their owners is but a token of the service which they have rendered to their fellow- men ; of others it may be as truly said that each dollar of their gains is but a token of theft, fraud, and corruption. It may be that some of the most conspicuous representative men in the railway system, hav- ing corrupted the judge of a high court, are now in the position of out- laws, incapable of being trusted, and subject only to the execration of their fellow-men ; yet good or bad as may have been the origin of these great fortunes, the railways themselves, under the higher law which controls all the exchanges of men, and in spite of injudicious and restrictive legislation, continue to do their work with ever-increasing benefit to those who consume the products which are moved upon them. I have thus endeavored to show how the great economic forces which have so recently come into action are steadily working out a greater equality in the distribution of the abundant product which they have brought into existence ; yet great as this progress is, it doth not yet appear what it shall be even in the near future. A wholesome dis- content now pervades all classes of the community, from which true progress will be evolved in spite of the obstructions of the anarchist and the socialist and the empirical devices of economic quacks and agitators. Progress and Poverty. 1 75 Steam and electricity have profoundly changed all the relations of men. The old order of personal intercourse between master and Avorkman is gone. The small self-contained community in which there were none very rich and none very poor has almost disappeared. The new forms of society are not yet shaped or moulded. The one thing most needed now is that the rich men shall know how the workmen live, and the workmen shall know how the rich men work. IV. THE PROGRESS OF THE NATION.' IN the three previous articles in the Foru?n I have endeavored to present facts which prove : First. How small a proportion of each year's annual product is or can be added to the capital of the country ; not exceeding ten per cent, in a normal year. Secondly. How rapidly this annual product has been increased in recent years both in quantity and in gross value, accompanied by a wider and cheaper distribution, resulting in a constant advance in the standard of common welfare and of common comfort. Thirdly. I have given the data tending to prove that although the additions to capital or wealth constitute a diminishing share of an increasing product, yet such has been the rapidity in the increase of this gross product as to have brought the accumulated wealth of this country at the present time to an amount greater in proportion to popu- lation than it ever was before, small in proportion to the total product as the annual increment of added capital may be. Fourthly. From these facts I have deduced proofs of the proposi- tion, that as capital becomes more effective it secures to itself either in the form of rent, interest, or profit, a lessening proportion of the increased annual product ; or, to put the case in another form, as capital becomes more abundant, as well as more effective, it is placed at, or worked in, the service of labor for a lower rate of compensation, or for a diminishing share of the joint product of labor and capital. Fifthly. As labor becomes more skilful and therefore more effec- tive, and is.at the same time more intelligently directed in its application to production, workmen secure to themselves an increasing share of a larger and larger product ; or, in other words, workmen attain larger earnings by their ability to make goods or to perform services of any kind at a constantly diminishing cost. This gain in efficiency and therefore in earning power, is attained by workmen in just proportion to the development of the individual capacity of each man or woman. The condition on which individual capacity leads to personal welfare ' Reprintetl from the Forum. 176 The Progress of the Nation. i 7 7 is, of necessity, that all men and adult women shall retain their personal control over their own time and their own work. If they are restricted in making their personal agreements or bargains either by State laws limiting the freedom of contract or by the by-laws of associations in disposing of their time, or if they are restricted in the personal control of their own methods of work, the earnings of the most skilful may be reduced to the average of the least capable. It also begins to be apparent that since the wage fund is that part of the annual product, or its value in money, over and above the lessen- ing proportion which may and must be devoted to the remuneration of capital or to taxation, the power of the workman may be said to grow by what it feeds upon. In proportion as the workman raises his stand- ard of comfort and welfare, he develops in the very mental conception of and in the desire for that higher standard, an increasing power to attain it ; thus his increasing share of an increasing product becomes the base for the attainment of a yet greater increase. It has been well said that the true measure of civilization consists not so much in the standard of living which is actually attained by com- mon laborers, as in the standard which is intelligently set up by them as the mark of their attainment. The truer the standard aimed at, the greater will be the power developed to secure it. Our mother earth stands ready to yield an unmeasured abundance of the means for mate- rial welfare, and will respond to productive labor in exact proportion to the intelligence vith which the work is directed ; therefore with the development of the mental as well as the manual or mechanical capacity, higher earnings becomes the correlative of a reduced cost of produc- tion. For instance : there is almost an exact correspondence between the supply of food and the power of doing the work by which the food is supplied. The Western prairies yield more meat and bread than the people of this country can possibly consume. The power of the rail- ways to distribute this food is in excess of the quantity waiting to be distributed. Let these two forces or instrumentalities of production and distribution be freely developed according to the opportunity, and it will follow of necessity that each person will obtain the largest sup- ply of food at the least cost. But if there should arise a prejudice against the railway managers such as to lead to obstructive interference at the demand of the majority of voters, then it must follow that the cost of distribution will be increased, the stimulus to production will be diminished, and the supply of food will be proportionately cut off until intelligent methods shall take the place of ignorant prejudice. Again : a large part of the labor of Europe is rightly named "pau- per labor." It is under-fed ; it is ineffectual and costly because it is. under-fed ; the one condition is a complement of the other. Why is it under-fed ? It is not because there is not land enough in Europe to, 12 178 The Industrial Progress of the IVation. sustain every inhabitant with a full supply of food. The reason is quite different. The masses of Europe are too ignorant to throw off the bur- den of dynasties and standing armies and navies ; they permit the sup- ply of food to be obstructed, and also permit so large a part of that which is produced to be devoted to the destructive purposes either of preparation for war or of active war, that what is left will not suffice for either adequate nutrition or for the comfort or the welfare of the work- man ; neither will it suffice to enable him to do the most effective work; therefore he tends to become a pauper. It is not, however, the purpose of the writer to deal with these broader aspects of this question. It is his present purpose to show that if the lives of either rich or poor in this country are still ignoble, it is not for want of the means for a better life. We shall hear less of classes among men, and we shall not be obliged to sort them into classes, when the true purpose of living is bet- ter comprehended than it is now by rich and poor alike. It is necessary to true welfare that the mental capacity and power of direction of the capitalist or his agent shall be recognized as a prime factor in production, especially by those who attribute abundance to the mere application of mechanical or manual labor to the work. There are admitted evils in the present age of machinery which are brought about by the extreme subdivision of labor, even though these processes are absolutely necessary to the production of that abundance without which the present general standard of living could not be set up even as the mark of future attainment. Yet out of this abundance even the dream of the eight-hour agitator may ultimately become a reality, but this attainment will be near at hand only when the workmen themselves comprehend that leisure is secured through liberty and not by way of restriction. This is only the first century of commerce in any true sense, and the bearing of steam and electricity upon civilization is as yet but dimly apparent ; their effect in shortening the necessary hours of work and in alleviating the adverse conditions under which so many common laborers now merely exist, has hardly begun. It is admitted that, co-incidently with the great progress from pov- erty which has been brought about by the very rapid application of in- vention to production and distribution, the conditions under which the work of the country is carried on have been profoundly changed ; there has therefore been at times great difficulty on the part of unskilled laborers in finding steady occupation, while there has also been more or less difficulty in adjusting themselves to new conditions on the part of persons whose occupations, requiring special skill and aptitude, have ,been done away with wholly or in part by the use of machinery. These difficulties have, however, been exceptional ; the general influence of all the changes referred to has been in the direction of lower prices, small profits proportionately to each transaction, accompanied by TJie Progress of the Nation. i 79 higher wages to those who do the primary work of production and distribution. As the margin of profit has diminished, a higher order of intel- hgence, a much closer method of business, and a more strict applica- tion of science have been called for in all large undertakings. There- fore, while the earnings of workmen have increased, the earnings of those who have been charged with the direction and application of capital have also increased, possibly even in inverse proportion to the lessening ratio of profit on which the remuneration of capital depends, while mere possession of capital has become less and less remunerative to the owner. Thus the work of the director or administrator of capi- tal, whether its owner or agent, has assumed a position of supreme importance. It may also be observed, that while great fortunes, even those which have been gained by theft and fraud or by gambling in the ;stock market with loaded dice and marked cards, have become more conspicuous, they yet bear in the aggregate a lessening proportion to the total savings of the community. It may not be a subject capable of absolute proof, but it may be safely held that the wealth of the ■country is more widely distributed than ever before. In respect to distribution by fraud and gambling it is also to be remarked, that no one need trust or deal with an outlaw who has corrupted the courts ■of the country, unless he chooses to do so, and that no lambs will be shorn who do not offer their own fleeces to the wolves. Again it may be remarked, that as the margin of profit diminishes, the so-called system of co-operation or profit-sharing becomes more impracticable, and also less desirable as a mode of distribution. Co- operative distribution has had some success in Great Britain, where a credit system has long ruled even in the retail traffic of towns and cities, but it has had little success in this country, where the principle of large sales at small profits, for cash or its equivalent, has long been in operation in the great retail shops. A glance over the figures of production and distribution will per- haps remove doubts as to these propositions, and may help in their comprehension. The great gain and the increase in consumption in recent years have been chiefly in the consumption of articles which are of common use by the great mass of the people, rather than in luxuries or articles of voluntary use. (Here we set aside for separate treatment the consumption of spirits, wines, and fermented liquors.) It is because so large a part of the industry of this country is applied to the production and distribution of the necessities and comforts of life that they become the subjects of paramount importance in the study of questions that are now at issue ; this fact also renders the alleged tendency to luxurious consumption and waste relatively unimportant. 1 80 The Industrial Progress of the Nation. If we take as a starting-point the year 1870, when the armies on both sides of the civil conflict had become finally absorbed in the pur- suits of peace, when the difficulties of the reconstruction period were mainly ended, and when the revolution not only of institutions but of ideas in the Southern States was so nearly completed that the whole country, as a unit, had entered upon an era of great material progress^ we find that while the population increased from 1870 to 1887 only 55 per cent., the product of hay, which is synonymous with meat and the products of the dairy, increased from 70 to 80 per cent.; the product of grain, 85 per cent.; the product of cotton, 112 per cent.; the con- sumption of wool, domestic and foreign, nearly 100 per cent.; the product of pig-iron, 285 per cent ; the construction of railways, 223 per cent.; and so on in varying proportions, all in excess of popula- tion, with regard to all the necessities and comforts of life. If the consumption of liquors be considered separately, the facts show that the consumption of champagne, expensive wine, brandy, and the like, is very small compared to that of beer and whiskey, or the drink of the every-day working people. The most complete and accurate estimate of the consumption of liquors has been made by Mr. F. N. Barrett, editor of the American Grocer, whose conclusion is that on the average, from 1883 to 1887, the consumption of spirits, beer, and wine cost the consumers a little less than $768,000,000 a year. Of this consumption, domestic spirits, domestic beer, and domestic wine amounted to $734,000,000, leaving only the remainder, $34,000,- 000, to cover foreign wines, spirits, and beer ; less than five per cent. It thus appears that the increasing supply and consumption of commodities of domestic and foreign origin have consisted mainly of those articles which enter into general consumption, and which are either the common necessities or the comforts of life ; or, if spirits and beer may be called luxuries, the luxuries of the common people. It follows of necessity that since there has been no accumulation of stock, and since all that has been produced or imported in exchange for the export of the domestic products has been consumed, the gen- eral consumption of the mass of the people must have been greater, more adequate, and more satisfactory than ever before. Yet in this period from 1865 to the present time, we have had several commercial crises, panics, and periods of alleged depression in trade and industry, recurring oftener than in former times, accompanied by want of em- ployment for a considerable number of workmen, especially common laborers, who feel the depression first and who are least capable of waiting for work on the proceeds of which they may subsist. It may also be observed that while the general tendency of prices throughout this period has been downward, there have been sharp and not infrequent upward fluctuations, or, according to the new The Progress of the Natio7i. i8i term, there has been a "boom" in trade and commerce. These new and varying conditions lead once more to the study of prices or to the determination of the very obscure question, What makes the price of goods ? They also bring up the question, What is the actual connec- tion between price and money, the latter considered quantitatively and qualitatively ? Whether or not these problems will ever be deter- mined in such a scientific way as to make the solution a part of the common knowledge or of the common-sense of the community, is a matter that cannot yet be decided. The utmost that can now be done is to treat, perhaps somewhat empirically, some of the forces that affect prices directly or indirectly by their influence upon the exchange of products, on which the salable value depends. Among the major forces promoting abundance and tending to increase the value of the annual product and thereby of the wage and profit fund, may be named improvements in the methods of banking, the telegraph, the extension of the railway and steamship service, with a reduction in the charge, and the opening of the Suez Canal. Amonsi; the lesser forces which have tended to obstruct the ex- change of products and thereby to reduce the general wage and profit fund and to affect prices, the war of tariffs may be named, by which the peaceful benefits of commerce are interrupted. In Europe these barriers of taxation, dividing the several states and nations of the Continent, maintain animosities of race, creed, and nationality. The customs revenue, being an indirect form of taxation, is kept up to the deception of the people who are oppressed by it. It is said to be necessary to the support of the several states by which these duties are imposed ; in fact, upon the Continent an analysis of the revenue and ex- penditure of only a few states proves that a sum exceeding $350,000,000 a year is collected from customs at these barriers, and a sum exceed- $500,000,000 a year is annually wasted in the support of standing armies and navies, which would not be required or tolerated if these barriers were leveled or removed. This evil is very much diminished and is of little effect in this country, except so far as the tariffs of foreign countries obstruct the import of our grain and other articles of food, for the reason that the continental system of absolute free trade throughout our whole country, covering a larger area and benefiting a greater number of people than ever before enjoyed absolute freedom from trade restrictions, has assured our progress in spite of all obstruc- tions to our foreign commerce, which is relatively unimportant. The main purpose of the present treatise is to consider only one of the forces which have in recent years exerted a great influence upon prices, and through prices upon the rates of wages, to wit, the currency or circulating medium of the country. (I hesitate to use the word ''money " in connection with mock or substitute money, viz., the legal- 1 82 TJie Industrial Progress of the Nation. tender notes of the government, which, under a fiction of law, have become fiat money, and have been forced into circulation in place of true money, which carries its own value in its own substance.) The advocates of fiat money, or unlimited paper money, attribute great importance to the volume or quantity of money or instruments of exchange in circulation. On the other hand, prior to the resumption of specie payment, the advocates of the specie standard, whether the single or so-called double standard, considered the quantity of circu- lating medium a most important factor ; they believed that the contraction of the circulating medium or of legal-tender paper money would be required in much greater measure than actually occurred, as a necessary precedent to the resumption of specie payment. It must be admitted by every one who gives any weight to facts, that the issue of legal-tender notes during the war was accompanied by great depreciation and by much greater advance in prices than in the rates of wages ; consequently the great mass of working people suffered great harm, which was in part compensated to them by the excess of demand for their products and services for war purposes. This was proved in the last article. But who can measure the relative importance of the quantity or volume of the notes issued, as compared to their discredit or the doubt of their ultimate payment during the dark period of the war ; or who can measure the effect on prices of the demand of the war itself upon the labor of the country, either in the military service or in supplying the armies ? The actual work of war is and must be done during the war period ; payment for such work by way of taxation may be in part deferred until either the bonds due at long date or the demand notes issued under a legal-tender act become payable. It is somewhat difiicult to conceive the measure of the actual work of the war. From April, 1861, to June, 1868, four years of war and a little over three years of reconstruction under military rule, the revenue of the United States was : From taxation, sales of public lands, and from miscel- laneous sources $2,213,349,486 From loans which were unpaid June 30, 186S 2,485,000,000 $4,698,349,486 The expenditures of seven years of peace at a consid- erably higher rate than in previous years might have been $698,349,486 Leaving the money cost of war to the nation $4,000,000,000 But to this must he added the war expenditure of States, towns, and cities. I am not aware that this has been separately compiled ; it must have been at least $1,000,000,000 Making the cost of war to the nation as a whole (in money or debt) $5,000,000,000 The Progress of the Nation. 183 But again, to this sum must be added the waste of property, of time, and what little capital there was in the Southern States, which cannot be estimated at less than three fifths the expenditure of the North, or $3,000,000,000. The waste in the South has perhaps been more rapidly made up than the cost to the North, by the abolition of slavery and by the emancipation of whites as well as of blacks from its degrading effects ; witness the subsequent enormous growth of all the varied arts and industries in the South, to which liberty has given place and opportunity. It may be assumed that at a minimum the cost of suppressing the Rebellion, which was promoted by the little oligarchy who made use of the slave power to mislead and deceive the masses of the people of the South, by making them believe that slavery and State rights were con- sistent with and were bound up in each other, was $8,000,000,000. The cost of establishing and maintaining national liberty and State rights in a true sense throughout the land, was therefore $1,135,000,000 a year for seven years. This price in terms of money represents so much actual work done, mainly by the privates of both armies and by those who supported them. It has been held that the maximum product of each person occupied for gain in 1880 could not have exceeded $600 worth. Labor and capi- tal were at least one third more effective during and since the year 1880 than during the period of war and of reconstruction. If then we value one man's labor from 1861 to 1868 inclusive at $500 a year, the work of war required the unremitting labor of 2,270,000 men for seven years, either in the two armies or in sustaining them. At $400 each, an estimate probably nearer to the mark at that time, the measure would be the constant work of 2,837,500 men for seven years. The average population of that period was 35,000,000, of whom not over one in five could be considered an able-bodied man of arms-bearing age. The cost of liberty therefore consisted in actual arduous work at the risk of life for seven years, of one man of arms-bearing age in every three. More than one third of the price of this work of war was deferred by borrowing ; yet such was the enormous increase in production and the facility for distribution brought about by the unifi- cation and completion of the railway system of the North, which took place at about the beginning of the war, and such was the effect of the rapid application of inventions and improvements, especially in agricul- ture, during this period, that not one single Northern crop diminished, and not one single art or nnportant branch of industry, except cotton- spinning, failed to increase. Therefore, as soon as the disbanded armies were absorbed in the pursuits of peace, production went forward with leaps and bounds, while foreign markets took our excess in payment for our foreign loans ; our bonds were rapidly returned to 184 The Industrial Progress of the Nation. us by purchase. In 1S76 and 1877 the tide of foreign coin set toward this country, and the resumption of specie payment became possible on the ist of January, 1879. In the latter part of this same period the wonderful development in Southern industry also occurred, than which there is no more extra- ordinary chapter in all economic history. That section of our country which had been devastated by the war, its capital destroyed, its former system of labor completely overturned, its people left to recover with- out inherited aptitude, mechanical appliances, or any other of the con- ditions which have been assumed to be necessary for success in diversified industry, is now dotted all over with factories of various kinds, and crossed and re-crossed by a rapidly extending railway sys- tem, while its mines and iron-works are threatening those of the older States ; yet more important, all the lesser arts of civilized life which go to make towns and cities are springing into existence. All this has been done in spite of the free and urgent competition of the Northern States, with all their capital unimpaired, their inherited aptitude, and their fully-developed mechanical appliances. Thus while the South (which previous to the war had depended mainly upon the North not only for manufactured goods, but for bread and meat, wasting its mis- directed slave labor by its application almost wholly to cotton, rice, and sugar) has now become almost self-sustaining, its crop of cotton has become more and more a money crop, representing its surplus of agri- culture or the means for a better subsistence than in the bad old times of the past. The North, thus deprived of a part of the great Southern market which it formerly enjoyed, while its own crops were rapidly in- creasing in ratio to its population, has found it more and more neces- sary to open a foreign market for the food which could not be con- sumed at home, and which might have rotted upon the field except it could have been exported. The reduction in the railway charge, taken by itself, may fully ac- count for the rapid increase in the export of grain, by means of which we more than balanced our import and paid our foreign debt. But there is a yet more subtle element to which attention might well be called. The value of the imports of merchandise over and above our €X])orts, from 1866 to 1875 inclusive, was in round figures ^817,000,- 000. The value of our exports of merchandise above our imports, from 1S76 to 1885 inclusive, consisting wholly of the products of agricul- ture, was $[,574,000,000. On what elements did this depend ? The railway charge upon the twenty-six great systems of railway which diverge from Chicago east and west, from 1866 to 1875, was 2.1837 cents per mile ; from 1876 to 1885 it was 1. 1037, making a saving of 1.08 on the trafific of these specific lines, on which 35 to 40 per cent, of the whole railway service The Progress of the NatioJi. 185 of the country was performed ; yet this difference in the rate of charge on these specific lines only, from 1876 to 1885 inclusive, came to more than $1,700,000,000, as compared to the rate charged in the previous ten years. This saving alone more than accounts for the excess of our exports over our imports, which excess enabled us to redeem our bonds or to import the coin necessary for our use. But the yet more subtle element is this : The self-binder was first successfully attached to the reaper in 1876. From 1867 to 1876 inclu- sive our average crop of wheat, varying more with the season than with the planted area, had been 258,000,000 bushels. In 1877, when the self-binder first began to be used, the crop mounted to nearly 364,- 000,000 bushels. Again in 1878 it mounted up ; and from that date to 1887 inclusive, in which period the use of the self-binder had become general, the average crop, varying more with the season than with the planted area, was 440,000,000 bushels. Could the crops of the last ten years have been saved without the self-binder ? When we consider the fact that in the United States the adoption of each harvester did away with the work of seven or eight men, who had previously been required to bind the crop by hand during the short harvest season ; when we consider also that the total number of self-binding reapers now made and sold is more than 100,000 a year, requiring over 30,000 tons of twine to bind a single wheat crop, at this date 1889, over 50,000 tons, do we not find in the tying of that knot on the self-binding harvester a main factor in the export of grain with the returning import of gold, on which we resumed specie payment ? By that single improvement the cost of wheat was reduced not less than 6 per cent., and in some places 10 per cent. We may also find in this little knot one of the most potent factors in the displacement of unskilled labor. There is an intimate connection between these forces and the currency question. The financial danger of this country came imme- diately after the war ended, when the expenditures were at their maxi- mum and the income had not reached its full measure. The green- back craze pervaded the country, and the welfare of the people was held to depend rather upon the quantity than upon the quality of the circulating medium. At that date there had been no record in history of any country which had paid a great war debt, or of any country which, having issued its own notes and having made use of them under a legal-tender act for the purpose of collecting a forced loan, had afterward redeemed or paid them in coin according to promise. Few there were at that time who had firm faith either in the redemption of the notes or in the speedy payment of the debt. The great war debt incurred and entered upon the books of the nation on the first of August, 1865, amounted to $2,674,815,856. To 1 86 The Industrial Progress of the Nation. this sum the Secretary of the Treasury, Hon. Hugh McCulloch, in his last report, added for debt due August i, 1865, but not audited and entered, the sum of $322,574,347. The maximum debt of the United States was therefore $2,997,386,203. It has since been reduced to $1,500,000,000, or from $84 to $18 per capita of the population. Sept. I, 1889, $1,083,740,625. The writer was apparently the first to prove, in an address to the Republican Convention of Massachusetts, September 19, 1868, that if the per capita taxation of the United States were maintained at the rate then imposed, $8.60 a year, the whole debt would be paid before Jan- uary I, 1885, as it would have been had not the average rate of taxation per capita been somewhat reduced. Its final payment has been deferred a little longer by a reduction of annual taxation to about $6.00 per capita, of which nearly $2.00 is now applied to the payment of the debt. There will probably be no Congress that will dare reduce taxation in sufficient measure to prevent payment of the last dollar of the national debt before the end of the century. During this period, from i860 to the present time, the quantity of the circulating medium, consisting of coined money or redeemable bank-notes or other substitutes, or of legal-tender notes which under a fiction of law have taken the place of true money, has varied, as shown in the table on the opposite page. Through the courtesy of the Secretary of the Treasury I am per- mitted to give this table showing the total amount of money, or of the instruments of exchange in use as money, consisting of coin, legal- tender notes, convertible bank-notes, or other instruments of exchange in use at the several dates given, computed per capita in ratio to the population each year. Absolute accuracy is not, as I understand, claimed for this table, but the estimate is as close to the mark as it is in the power of the Treasury Department to compute it. It will be observed that even if the present tendency of the surplus revenue is to cause all the United States notes to fall into the Treasury without re-issue, and even if it should end in the liquidation by way of taxation of all that part of the circulating medium which now consists of United States legal-tender notes which are not already in the Treasury or covered by coin in the Treasury, and the circulation or volume of what passes for money should be contracted to that extent, there would nevertheless remain in circulation in coin, in gold and silver certificates, or in convertible bank-notes, a sum per capita sub- stantially the same as that of the year 1880. It will be remembered that the year 1880 was a year of more than normal prosperity. May it not therefore be inferred that the country is now rich enough and strong enough to pay its demand debt, represented by the legal-tender notes, and to withdraw those notes from circulation without any The Progress of tJie Nation. 187 appreciable effect either upon prices, wages, or credits ? If such be the fact, delay in reducing the so-called surplus revenue by reduction of taxation may, so far as its effect upon the circulating medium is con- cerned, work no injury but rather a benefit. The table on page 188, showing the relation of prices, wages, and purchasing power and quantity of the circulating medium, is given in order to sustain this view. It will be interesting to observe, in the con- TABLE SHOWING, FOR THE UNITED STATES, THE POPULATION, TOTAL AMOUNT OF MONEY, AND THE AVERAGE AMOUNT PER CAPITA YEARLY, FROM i860 TO 1887 INCLUSIVE. Total amount of money, exclusive of legal tender, gold, and silver Population. certificates.* i860 to 1872 inc. Average Amount of Year. (Prof. Elliott's Tables.) taken from Fin. Rep. of 1886 ; 1873 '° 1887 inc. taken from Fin. Rep. of 1887. Money per Capita. i860 31,443,321 $ 442,102,477.00 $14.06030 1861 32,060,000 488,005,767.00 15.22164 1962 32,704,000 532,832,079.00 16.29257 1863 33,365,000 623,100,168.75 18.67526 1864 34,046,000 1,062,840,516.50 31.21778 1865 34,748,000 1,180,197,147.76 33.96446 1866 35,469,000 1,068,065,785.96 30.11266 1867 36,211,000 1,020,927,153.52 28.I93S4 1868 36,973,000 888,412,602.75 24.02869 1869 37,756,000 873,694,101.61 23-14054 1870 38,558,371 899,875,899.48 23.33802 1871 39,555,000 894,375,751-06 22.61094 1872 40,596,000 900,570,903.52 22.1S373 1873. 41,677,000 891,211,673.94 21.38378 1874 42,796,000 939,225,887.17 21.94658 1875 46,951,000 914,149,629.69 20.79929 1876 45,137,000 904,849,434.89 20.04673 1877 46,353,000 922,160,168.84 19.89429 1878 47,598,000 989,845,159.27 20.79594 1879 48,886,000 1,056,232,698.11 21.61488 1880 50,155,783 1,207,827,059.70 24.08151 1881 51,495,000 1,371,688,001.65 26.63731 1882 52,802,000 1,431,411,868.18 27.10905 1883 54,165,000 1,494,404,497.14 27.58986 1884 55,556,000 1,503,129,680.64 27.05612 1885 56,975,000 1,553,246,868.21 27.26190 1886 58,420,000 1,577,191,425.52 26.99746 1887 59,893,000 1,649,149,915.37 27.53494 July 17, 1888. Jos. S. McCoy, Acting Government Actuary. > Gold coin, silver coin, and United States notes may be deposited in the Treasury under present laws, and certificates taken out which enter into circulation in place of the coin and notes thus deposited. i88 The Industrial Progress of the Nation. sideration of this table, that the welfare of the workman has wholly de- pended upon the quality of the money in use, and not upon the quan- tity, again enforcing the principle that if we keep the quality of our money true the quantity will take care of itself. In respect to the data on which this table has been compiled, I beg to say once more, with regard to the rates of wages, that they have been averaged from a compilation of the figures given in the larger number of establishments treated in Volume XX. of the United States Census, those of which I have had some knowledge myself as to their having l)een in continuous operation throughout the period treated, or else RELATION OF WAGES, PRICES, PURCHASING POWER OF WAGES, AND VOLUME PER CAPITA OF MONEY OR CURRENCY IN CIRCULATION AT THE RESPECTIVE DATES GIVEN. 1860 1865 1870 1875 1880 1885-86 1 ^ S 2.31 $2.13 $2.10 Rate of Wages per day. $2.23 $2.26 No. 1 Sl.M /^jG9 ^ y tls. ^ Ss? No. 2 .3085 cte. cts. o: !m9 ■ cts. ^3321~~ cts. 30 cts. Price of one days supply of food, fuel and cloth. 3 o o s o C5 2040 Q ►J O Oj 2100 Purchasing power of 300 days wages in portions of food, fuel and cloth. No. 3 ir,72 / 12G1 S 33.90 \ 1716 S 2.3.33 1770 $20.75 $21.0S $27.25 Money or Currency in circulation per Capita . No. 4 $11.(JG 1800 1805 1870 1875 1880 1885-86 1 No. I. — Average wages of mechanics, engineers, carpenters, machinists, and painters connected with the mills and works treated in Vol. XX., United States Census ; establishments in Eastern, Middle, and Western States. No. 2. — Average cost of one day's supply of food, fuel, and material for clothing customarily used by such mechanics, computed at retail prices in 20 shops ; 10 east and 10 west of Buffalo, N. Y. No. 3. — Purchasing power of 300 days' wages in equal portions of the same kinds of food, fuel, and cloth as above given. No. 4. — Quantity per capita of coin, convertible bank-notes, and legal-tender notes in circulation or in use as money at the respective dates. The Progress of the Nation. 189 such as from the nature of the work must have been fully employed throughout the whole period, being selected for the purpose. The rates are doubtless somewhat lower than would be shown by a compi- lation of figures given by mechanics themselves, engaged in analogous trades. This would always be the case if the wages of mechanics who are permanently employed in connection with factories were compared with those whose work is transient and not continuous throughout the year, owing to the nature of the occupations, as in the building trades. The rates of wages have also been compared with those computed on special investigations made on my own behalf, from typical establish- ments in the State of Massachusetts, which I know to be correct. With respect to prices, I had myself made averages of prices from data obtained by myself before Volume XX. of the Census was issued ; and by comparing my own data with those of the Census, I was able to verify the prices given in that volume for the Eastern States. The number of portions assigned to 300 days' work of course assumes con- tinuous work, like that of the factory, which runs every working day in the year, omitting Sundays and holidays, customarily computed at three hundred days. The computation of money or currency per capita is as accurate as the official data of the Mint and of the Treasury Department will permit. The only issue which can be raised affecting it, is in regard to the quantity or amount of coin in the hands of the people. This subject has been a matter of considerable discussion ; suffice it to say that the absolute knowledge of the subject possessed by the Depart- ment of the Mint would substantially verify the proportions of currency per capita given in this table, even if the amounts did not absolutely correspond and were somewhat less. It may, therefore, I think, be safely assumed that the margins for error in these four computations are very small ; and if all errors were eliminated, while the figures might be slightly changed, the ratios or proportions would not be varied sufficiently to affect the general conclusion. In view of these variations in the quantity of money or currency in use at different dates, which bear no steady or uniform proportion either to the volume of trade or to the population of the country, it is apparent that the quantitative theory of the currency cannot be main- tained. May it not be held that confidence and credit have been greater factors in making prices than the quantity of the money or circulating medium of the country, which is made use of directly only in the petty or retail transactions of trade ? Is it not the confidence engendered by the way in which we have overcome difficulties and dangers, that keeps our mixed currency at par with gold at the present time and that will enable us to surmount difficulties yet to come ? If 1 90 The Jjidustrial Progress of the Natioji. we keep the quality of our money good we may be sure that the quantity will take care of itself. The resumption of specie payment took place January i, 1879 ; the fiscal year ends June 30th ; it is therefore more easy to make com- pilations from that date by calendar years. From July i, 1879, to July I, 1887, the declared value of our net imports of merchandise was $5,640,261,758. In the same period the declared value of our exports of merchandise was $6,764,311,704. The true value of exports has doubtless been somewhat greater, as those which go by rail to Canada and to Mexico have not been accurately recorded ; the official reports of the Dominion of Canada and of Mexico prove them to be in excess of the value declared in this country. It will be apparent that such an enormous volume of exports could not have been sold for payment in money only, since the stand- ard of international commerce is coin or bullion. The coin which serves the purpose of international commerce is computed at the gold standard, there being no legal tender in international exchange. Such a demand for gold or gold bullion in sole payment for our exports would have drained every bank in Europe, and we should have no domestic use for such an amount of coin ; therefore unless an exchange of domestic for foreign products had been possible the export could not have been made. We could not have paid for our imports in coin only, nor could foreign countries have paid us for our exports in coin only. International trade must of necessity mainly consist in an exchange of goods for goods, the balance only being settled in gold. Had it not been possible to make this exchange, or to export the excess of our corn, wheat, dairy products, cotton, and oil, this excess could not have been consumed at home, as the remainder met the demand of the most abundant and increasing consumption ; nor could many of our domestic industries have continued without the import of crude or partly manufactured materials from abroad. This mutual dependence or interdependence of nations is too gen- erally admitted to make it worth while to waste time on the theories of a few incapable persons who advocate national isolation, with whom discussion is useless. The benefit of foreign commerce, under certain conditions, is fully admitted by every one. It may be admitted that the duties upon foreign imports give a different direction to domestic industry, but the effect, whether beneficial or otherwise, of our present system of duties, has been, in the opinion of the writer, very greatly exaggerated by the representations of both sides in the discussion of the system. When this becomes a part of the common conviction, the reform of the tariff, admitted by both parties to be necessary, may be entered upon by reasonable men without bitter contention, and with the simple purpose of adjusting the necessary revenue duties so as to The Progress of the Naiiofi. 191 give the widest scope to the development of domestic industry, and to interpose the least obstruction to the exchange of product for product, in which our foreign commerce must, in the nature of things, consist. The point to which I desire to give prominence in this treatise is, that in spite of the depreciation and the fluctuations in the currency, and in spite of the ill-adjusted burden of taxation of all kinds which is now admitted by all parties, whether under a tariff, under the internal revenue system, or under State and municipal assessments, the effect of these minor forces has been but to retard in some measure the great progress of this country. Confidence and credit have been based on the progress which is assured by the application of invention and of science to human welfare ; these elements of commerce have far more than counterbalanced the blunders and stupidities of financial legisla- tion, and will ultimately force our fiscal system into harmony with the higher laws of material progress. If some of the computations presented in this treatise are already familiar to my readers, I can only justify their repetition by having brought them down to a later date. V. THE STRUGGLE FOR SUBSISTENCE.' ONE of the most noticeable facts of the present day is the great and general interest in statistics. It is now admitted that every economic hopothesis must be tried by the test of figures to see if it coincides with the facts of life. It is also admitted that these figures must be compiled, sorted, and corrected by well-trained men and the work guided by their judgment, so that the figures may not lie. Both parties in the national Congress have united in establishing the national Department of Labor Statistics, and more than half the States ha.ve established State bureaus. Not least significant among various incidents is the fact that special labor organizations are making ap- pointments of statisticians by whom the specific figures relating to their separate departments of labor may be compiled. After a few years there will be a basis for a true science of statistics such as has never heretofore existed ; it almost exists to-day, and from it a true science of inductive political economy may soon be evolved. By drawing from every source as yet available, the writer has recently presented statistics which cannot be gainsaid, proving, so far as figures suffice for proof, that greater progress than ever before has been made during the present generation, dating from 1865, when this nation first truly attained its independence, in providing for the means of subsistence, shelter, and clothing, and in organizing the ma- chinery for distributing the necessaries of life. Computations have also been given which go far to prove not only that since the dangers, difficulties, and destruction of the Civil War were surmounted and since slavery was abolished, there has been a more equal distribution of the necessaries of life among the masses of the people of this country, but also that there has been a more equitable distribution since the stand- ard of value of the country was re-established on a specie basis. No attempt has yet been made to compile or to compare the statistics of the hours of labor, but figures arc not needed to prove to any one who has even a moderate faculty for observation, that the hours of labor as a whole have been diminished, while much of the hard hand work has been displaced by labor-saving mechanism. In the fac- ' Reprinted from the Forum. I(J2 The Struggle for Subsistence. 1 93 tory, either by way of legislation or in spite of legislation, it matters not which for our present purpose, ten hours have become customary in place of eleven or even twelve ; the usual hours of work in textile factories forty or fifty years ago having been thirteen and even four- teen. In the building trades, either by way of trade unions or in spite of them, nine and ten hours have become customary in place of eleven and twelve, or even more. In all the great retail shops and wholesale warehouses in which goods are distributed, the hour of closing is earlier and the hour of opening is later than it used to be. In the factory the rooms are better lighted, better ventilated, and in winter more uni- formly heated than ever before. Attention to sanitary conditions has become necessary even to pecuniary success. In the field the farm laborer rides upon the plow or upon the mowing machine, the hay rake, or the tedder, freed from the hard labor of guiding the plow by hand, mowing the hay with the scythe, or reaping the harvest with the sickle. The steam harvester and thresher have rendered the work of saving the grain crop vastly more effective and much less arduous to each person. In the building trades the small hoisting engine lifts the men and the materials to the tops of the highest buildings, while much of the heavy work of preparing the timber and other materials, which formerly re- quired long and arduous work by hand, is done by steam or water power in the factory. The optimist can thus find on every side facts which sustain his view that the general struggle for life is becoming easier and not harder, while the statistics of the life-insurance compa- nies prove that the duration of life is lengthening. Even in some cases where the quality of the working people may appear to have deteriorated, and their standard of living to be no longer equal to what it was in the same pursuit twenty or thirty years ago, one may find, on looking a little deeper into the causes of the change, that by way of improvements in machinery either less intelli- gence or less mechanical aptitude is now required on the part of those who tend the machines than was formerly needed in the same branch of industry. In this way a class of operatives has been brought into the factory and there enabled to do efficient work, for whom a few years since there would have been no place above the plane of un- skilled, menial, or common labor ; while the class of operatives formerly required to do this kind of work has been lifted up to better conditions, better work, and better wages by the possession of the same superior qualities which first enabled them to do the work of the factory when the machinery did less and the man or woman did more. Forty or fifty years since, the daughters of the farmers of New Eng- land worked thirteen hours a day in the cotton factory in order to earn $175 a year ; to-day French Canadians, working ten hours a day, earn $300 a year ; yet the cost of labor is less now than ever before. 194 ^^ Industrial Progress of the Nation. Every point thus far recited can be sustained by such evidence that it cannot be gainsaid by any one. In a broad and general way it might be proved that Uncle Sam and his children have obtained such power over the mechanism of production and distribution during the past twenty-five yeg-rs, that if the long hours of work required thirty years ago to produce the materials for a narrow and poor subsistence were now applied under the new conditions, the same hours would yield at least one third more of all the necessaries and comforts of life than they did then. This gain in power has been applied in two ways. First, it has led in part to shortening the hours of work. Secondly, it has led in part to the attainment of a more ample subsistence and to a higher standard of common comfort and welfare. A better subsistence, better clothing, and better shelter are now obtained with shorter hours of work and less arduous effort than ever before, by all who have aptitude and industry coupled with the mental capacity which is required to enable them to adopt the new methods. Such must be the necessary conclusion from a comparison of the conditions of the present genera- tion with those of the one next preceding it. Yet no one can be blind to the fact that in many occupations which are necessary to the present mode of life, great numbers of persons are either worked to the utmost of their strength, or else are of necessity occupied so many hours of each day that what time remains to them is barely sufficient for eating and sleeping, so that healthy recreation is absolutely wanting. Time has not yet been saved to all. The well- trained or skilled workman can get more with less effort, but the com- mon laborers have increased relatively in their number by immigration, and are not yet educated to the level of the present opportunity ; hence arises want in the midst of plenty, and a waste of abundance which with better individual training might be saved and made conducive to com- fort and leisure. Again, many occupations which are necessary to the present methods of life, and without which modern society could not exist in its present form — especially the kind of work which is done in great factories, mines, and furnaces — involve the continuous labor of multi- tudes of men and even of women under very monotonous and in some few branches even noxious conditions, or else under conditions in which the attainment of even a physically clean and wholesome life for a part of each day or week seems almost hopeless. What is called division of labor distributes and sorts men and women each to a separate part of the work, which may be in some cases harmful to health, in some cases so extremely monotonous that there is no mental stimulus in it, and in some cases so depressing or even degrading in its necessary conditions as to preclude almost any hope of mental development. It is one kind of work all the time, in The Struggle for Subsistence, 195 place of many and varying kinds dividing the longer day's labor. In former days there may have been more hard work, more unpleasant work, and even more unwholesome work to be done ; but was it not so divided and distributed that but few persons were limited to work of any one kind, day in and day out, for three hundred days in the year ? Was there not more variety, more versatility, and more oppor- tunity for young men and women to iind out for themselves what they could do in the best way, and also a better opportunity to improve their position than there is now in the arts to which this so-called system of division of labor has been applied ? Was there not also a more humane relation between the employer and the employed, more sympathy, and more recognized mutuality in the service of each to the other ? Yet, if the great factory did not exist, and were it not for modern machinery and mechanism and this subdivision of labor which has become necessary to any adequate supply of the means of living, how could the existing population of Massachusetts, for instance, of whom at the present time more than one fourth are foreign-born, and more than one half of foreign parentage, live even as well as they do ? Had it not been possible for these foreigners to come here in order to avail themselves of the opportunity which is offered, how could they have existed at all in the lands which gave them birth, which are even now overcrowded ? If it sometimes seems that progress and poverty march together, one may ask what would have been the poverty with- out the progress ? If the analysis of our present condition, relatively good as it is compared to former times or to other countries, yet proves that only a narrow, poor, and meagre life has become possible to great masses of people, in what direction shall we look for the progress in which poverty shall cease to be one of the phases or correlatives ? Can we lift great masses of people all together to a higher plane, or must we rest content with such developments as open their own way to those who have the eyes to see and the capacity to attain each for himself or herself ? Can any one be boosted by the state who cannot help himself ? After all has been proved in respect to greater abundance, lower cost, more equitable distribution, higher wages, and smaller margins of profit ; after all has been recited that can be claimed in the line of progress, what does it come to ? What is the result ? What is the present measure or limit within which each and all must of necessity subsist ? Is it sufficient and ought it to induce content, or is there a sound and reasonable cause for discontent and a craving for some- thing better ? In order to consider these questions great aggregates in millions must be avoided ; such figures only mislead and delude. The condi- tions of life must be brought down to the unit of the individual or of 196 The Industrial Progress of the Nation. the family. When this has been done, the few who have attained an abundance, and who have reaped the full benefit of all that science and invention have enabled them to accomplish, may for the first time begin to comprehend the aspect of life that is presented to the many who have not yet secured a much better subsistence, or a more suitable dwelling, or greater comfort and better opportunities. These problems must be studied from below as well as from above, from within as well as from without, if the discontent of the present day is to be removed by gradual, peaceful, and adequate methods ; for the very reason that the better conditions of life which are now so readily attained by those who are capable of grasping the opportunity offered them, bring into more and more conspicuous contrast the adverse conditions of those who have not yet become capable of such attainment. Probably very few of the persons who will read this article, in fact very few among those who read with interest and intelligence any articles, essays, or books upon what is called the labor question, have themselves had the kind of experience which is necessary to enable them to comprehend the aspect of life to the man who can earn only one or two dollars a day for the support of himself and of his family, if he has one. Perhaps even a less number may have the kind of imagination that will enable them, without having had the experience, to comprehend the struggle for life on these terms, even if they try to put themselves in the place of the common laborer or of the mechanic who can barely do the limited and monotonous work in which he is occupied, without the prospect of ever doing any thing more or different. If it shall prove that a great number of people at the bottom can barely exist, while a considerable number at the top enjoy much more than is required for a good subsistence, may it not soon become neces- sary for those who are in possession of wealth to justify their position, by proving that by the use either of their own personal ability or of their capital they add more to the annual product from which all in- comes are derived than they take from it for their own consumption ? The man of superior ability may add a million dollars' worth a year to the value of the annual product, which addition except for him would not have been made ; from this he may secure a personal in- come of a hundred thousand dollars a year, yet he costs the com- munity only what he and those who depend upon him consume. Is he not a cheap man for the community to employ in its service, even if he finds his recreation in fine horses and a fast yacht ? If nine tenths of the product which he has brought into use falls into the common stock whether he will or not, cannot the community well afford to him his tithe even if he wastes it ? Vanderbilt reduced The Struggle for' Subsistence. 1 9 7 the cost of moving a barrel of flour a thousand miles from a dollar and a half to fifty cents ; was he not a cheap man for the community to employ even if he did make a hundred million dollars ? What he made himself was but a tithe of what he saved to the community. In other essays I have endeavored to show that not exceeding ten per cent, of the product of a normal or average year can be saved in a concrete form and added to the capital of the nation. Whether this ratio is correct or not, it will be admitted by all that a certain amount of capital must be saved in some way in order that society may con- tinue to exist, even under the present narrow conditions of life. It will be generally admitted that it is more important that capital should be efficiently maintained than it is to determine who saves it or who controls it. A large part of this addition to capital may, and doubt- less does, consist of the savings of persons who can never hope to accumulate enough to enable themselves to give up work in their later years, or to live wholly upon the income of what they may save. The most that the great majority can expect to do, is to lay up a moderate sum of which they may expend the principal when they become dis- qualified for work, unless they are then supported by their children wholly or in part. There are no data by means of which the number of the rich or even of the well-to-do persons can be set off as a separate class from the rest of the community ; that is to say, there is no way to find out how many can accumulate a sufficient amount of capital to enable themselves or their children to live upon the income of their property without further work. Suffice it that the proportion is very small in- deed in point of number ; and as the margin of profit becomes less, or as the amount of capital required in order to yield an income sufficient for a comfortable support without work becomes greater, the proportion of those who can hope to live without work in their later years will probably diminish rather than increase as time goes on. It is probable, to say the least, that fully ninety per cent, of the whole body of the people spend nearly all that they earn ; of this ninety percent, a portion may, by setting aside a moderate part of their small earnings, become the owners of a house, or become depositors in a savings bank, or insure their lives in a moderate way ; of the remaining ten per cent, a part save enough to protect themselves against want in their later years, and a very small part may become rich, and then need not work unless they choose. There are but few in each generation who do not choose to work, whatever their motive may be and however rich they may be ; the actual drones are but a small fraction even of the rich, hardly calling for attention. They are, like Mr. Toots, of little consequence to themselves and of no consequence to others. 198 The Industrial Progress of the Nation. When it is admitted that the whole capital of the richest State in this Union does not, and probably never can, exceed in value three years' annual product of the same State ; and that the people of the richest State are always within one year of starvation, within two years of being naked, and within a very few years of being houseless and homeless, unless they work for a living, what possibility is there that any considerable part of one generation can save their children to any extent from the beneficent necessity of supporting themselves ? Our present aggregate product, whatever it may be, being mostly con- sumed by those who work for a living, what is the limit within which the measure or cost of living must of necessity be confined? When we have settled this question we may ask. What is the aspect of life to the average man or woman who works for a living in order to gain a mere subsistence, and what can we do to better it ? In the next article I will give the reasons for my conclusion that the present limit within which the great mass of the people of this country must find food, fuel, shelter, and clothing ranges between that which forty cents and that which sixty cents a day will buy for each man, woman, and child in the community, the average not exceeding what fifty cents a day will purchase. It requires the work for gain or the earnings in money of more than one in three in the population to sustain the whole community ; and the average earnings of the great mass of the people range from $1.00 to $3.00 a day, on which earn- ings three persons must be sheltered, fed, and clothed. The picture which is brought before the eye or mind of him who can take in the full significance of these figures is somewhat appalling. It might lead many to ask, If this is the result of the highest civilization yet attained by the most favored nation, is life on the whole worth liv- ing ? and one must carefully guard himself against the influences of materialistic philosophy in order to keep an even balance in his own life. It may not be judicious for the mere business observer, who cannot claim to be able to comprehend any thing more than the elements of the philosophy of history, to venture to forecast the future ; yet to many prosperous persons who now pay little regard to the blind struggle of vast numbers of working men and women to improve their condition, and who think workmen have no rights to be secured and no wrongs to be redressed, one may rightly put the question. Have not you also something to do in the solution of these problems? Are there not signs of danger ? May not the existing unbearable tension among European nations, burdened as they are with monstrous national debts that can never be paid, and with huge and onerous standing armies which it seems to be impossible to disband, end in revolutions in which many feudal privileges and vested wrongs may go down forever, but ia The Struggle for Subsistence. 1 99 which also many institutions covering not only rights of property in land but in all the products on which existence depends, may for a time be questioned ? If such should be the course of events in other countries, are we so strong in our popular government that we ourselves may not share some of these difficulties and dangers ? Or even if there be no danger to society in this country, and, as the writer most jjro- foundly believes, nothing but benefit to be ultimately gained from the organization of labor and the study of economic problems by so-called labor associations, clubs, and societies, might not all others also join in attempting to solve these problems, to the end that free institutions may be fully justified, not only by those who possess an abundance, but also by those who can find in such institutions the opportunity for tliem- selves or their children to attain the conditions of life which may indeed make this life worth living to the poor as well as to the prosperous ? VI. THE PRICE OF LIFE." IN my last essay I endeavored to present the condition of life as they must of necessity appear to him or her who earns little more than enough, or barely enough, to support material existence. In those which preceded it I endeavored to define the limit within which life must be sustained, if sustained at all, under the present conditions of production and distribution. The series would be incomplete if in this paper the figures which define the limit were not again presented and worked out more fully and conclusively than they have been elsewhere. In the subsequent computations I shall omit small fractions and shall deal with round figures only. In 1880 the average family group consisted of five persons ; the working group consisted of a fraction under three persons, one of whom sustained two others. The time had not then come, and has not yet come, when the work of women and children for gain or money payment could or can be spared ; it will be many long years before the head of every family of five persons can produce enough, or can procure enough by his own exertions, for the support, in comfort and welfare, of four per- sons dependent upon him. This would be true if we were to consume Tor mere subsistence every thing that we produce. If the total product were divided evenly and consumed, there would not be enough to raise the general level much above what it now is, and the next generation would then suffer want because we had eaten up or worn out that part of the product which ought to have been saved in the form of capital. In all the computations which existing data enable me to make, I have been obliged to stretch a point and to assume a maximum rather than a minimum estimate of the gross value of the product of the nation, in order to find six hundred dollars' worth of food, fuel, shelter, and clothing as the average product of each person occupied for gain, by which product, whatever it may be, three persons must be subsisted, housed, and clothed. This is the gross product. Unless ten per cent, of the six hundred dollars' worth be set aside by some one, whether by rich or by poor matters not, to be added to the capital of the nation, ' Reprinted from the Forum. 200 The Price of Life. 201 the product of future years will be diminished rather than increased, and want will then ensue rather than welfare. Again, a part of this product must be diverted by taxation to meet the necessary expenditures of the country and of the several States, cities, and towns. The taxes required for cities and towns are assessed upon property in a great measure, nevertheless they must come out of the gross product of the nation ; they represent work of some sort, and those who do the work, of whatever kind, contribute to these taxes. A tax cannot be made to stay where it is put ; it is distributed no matter where it may be first collected. All profits, all taxes, all shares of the product represent work of some kind, whether it be mental or mechanical or manual. It may be work in which capital or machinery has saved labor the greater part of the effort, or it may be work in which manual labor does the most and machinery the least. If the capitalist cannot demonstrate his right to the share which falls to him by proving that in the direction, control, and use of the capital which he owns he adds to the gross product more than he takes away for his own consumption and for that of those who depend upon him, then he must hold his capital only by force rather than by recognized service. If taxes cannot be justified in their expenditure, they cannot be justified in their collection. If the possession of property does not rest upon service rather than upon force, on what pretense can any one set up the right to property? The word " right " cannot cover wrong. Can he who lives on others' work, or who takes from the product even a small part without adding by his own service or that of his capital more than he takes from it, jus- tify his existence or set up a right to the property that he misuses, no matter how legal may be his title ? In 1880, State, city, and town taxes came close upon twenty dollars per head of all who were at work — about six dollars per head of the population. Assuming that sixty dollars' worth of the product, on the average, of each person occupied in gainful work must be set aside to be added to capital by some one, and twenty dollars' worth must be set aside to sustain States, cities, and towns, in order that society may continue to exist — eighty dollars' worth in all out of each six hundred dollars' worth, — we then find a net income, on the average, to each work- ing man or woman who is not in the public service or sustained by the taxes, of five hundred and twenty dollars a year ; or rather, what five hundred and twenty dollars a year will buy for their own consumption. Computing three hundred working days in the year, this gross sum of six hundred dollars yields a fraction less than one dollar and three quar- ters per day — a little less than twelve dollars per week, or fifty dollars per month, — and if out of this sum, or of what this sum will buy, after setting aside ten per cent, for the necessary addition to capital and the 202 The Industrial Progress of the Nation. local taxes, three persons must be subsisted, sheltered, and clothed three hundred and sixty-five days in the year, the measure of the average com- fort and welfare is only about what forty-five cents a day will buy and no more. But even this narrow measure of subsistence is again subject to the indirect tax of the nation. The national revenues being chiefly col- lected by taxing articles of common or necessary use, are paid in pro- portion to consumption rather than in proportion to income or ability. In 1880 and since then, the national revenue has come to six or seven dollars per capita each year, varying somewhat ; or from eighteen to twenty dollars a year upon the earnings of each person occupied for gain ; leaving a net revenue of five hundred dollars a year, or only what less than forty-five cents per day will buy per capita for personal con- sumption. How much food, fuel, clothing, and shelter can the reader buy for forty-five cents a day ? Would it not be well to answer this question before what may be miscalled "the claims of labor" are wholly ignored ? There is, of course, room for error in this computation ; but an error of five cents a day per person now comes to more than eleven hundred million dollars a year, and one may fairly claim that such a gross error could hardly be made by a careful observer or compiler of statistics. In any event I think it may be assumed that our annual product at the present standard of production, when sorted and divided under present methods of distribution, and subject to no greater assessment than is necessary to maintain the capital of the nation and to meet taxation even when reduced to the lowest possible limit, can- not yield more than fifty to fifty-five cents' worth of the necessaries of life per day for the personal consumption of each man, woman, and child of the present population, after allowing for any possible error. It follows of necessity that by so much as some enjoy a larger portion than this must some others have less ; yet this is the most productive country in the world in ratio to its population, and great multitudes are flocking to our shores to take part even in this measure of abundance. Present population, about 61,500,000 Share of total product consumed for personal use, at 50 cents per day each $11,200,000,000 National and State taxes, about 700,000,000 Addition to capital, computed at ten per cent., about 1,300,000,000 Gross product $13,200,000,000 This would be about $630 per head to one in three occupied for gain. In order to increase the average consumption by five cents' worth a day to each person, an additional product of the value of $1,122,000,000 a year must be made ; a market must be found in order that this product may be converted by exchange and distributed in TJic Price of Life. 203 terms of money. Yet we have heard more of over-production in recent years than of any other complaint ! Would not under-consumption be a more suitable term ? Now let any reader or observer pass in review or attempt to com- pute the number of people about whose condition he himself is toler- ably well informed in the community in which he lives, and he will unquestionably find a greater number of men and women who are en- gaged in getting their own living (to say nothing of children) whose earnings are less than one dollar and three-quarters a day, than he will of those whose earnings are more. What is the aspect of life to this vast body, constituting a majority of the people of this country, who earn less than one dollar and three-quarters per day, and who support themselves and two others on such an income? When this question is brought clearly before the mind the true " labor question " begins to declare itself. What are you going to do about it ? Is it not a question which demands the attention of rich and poor alike in a democratic country, where the power of legislation rests upon the- votes of the majority? What do those to whom it matters little whether they spend twenty-five or fifty cents, or even a dollar a day, per capita, for the food only of themselves and their families, really know about the problem of life as it is presented to him or her whose food costs one half the entire income or earnings, and who must find not only food but a dwelling-place, clothing, and all the necessaries of life out of what forty or fifty cents a day will buy at retail prices at the present time ? What do people know about these conditions who never lacked sufficient clothing, and who possess more than one good room well warmed for each member of their families, or perhaps two or three good houses for one family ? If the limit of all that is produced is what I have given, or whatever it may be, whether more or less, it is the source of all wages, earnings, profits, rents, interest, and taxes. There cannot be more than all there is to be distributed, hence it follows of necessity that by so much as some have more of the comforts and luxuries of life, must others have less. Modern society exists by exchange. Few persons take any part in building their own houses or in furnishing them ; few do any thing more than a small part of the work of making their own clothing ; and aside from those who dwell upon farms, hardly any persons produce any thing which they consume for food. There are only three methods of distribution yet invented. The first is by exchange ; the second is by theft or fraud, sometimes within the forms of law ; and the third is by taxation. These three ways take a variety of forms. How can the general welfare be improved except by increasing the product of labor and finding a market for it, or by doing away with every existing method of distribution which is not right or just? 204 The hidustrial Progress of the Nation. There are certain ethical problems which may come into view to him who seeks to justify his own greater share in the comforts of life. One question which a man may put to himself might be, Does the occupation in which I am engaged add to the mass of products which are needed for general consumption more than is taken away by my own consumption or by those among whom I spend my earnings ? Or even a deeper problem may sometimes arise of an ethical nature : Does the work which each man performs come within the line of useful service ? Does it add to the stock of useful products, or does it fall within the line of baneful service and add to the stock of harmful products ? Is the demand for which this man provides the supply of a kind which adds to the comfort of the community as a whole, or is it one which tends toward want rather than welfare ? By the answer to these questions each man may hereafter be judged in the court which supplements the treatment of economic questions by the study of ethics. Before we can begin to answer these questions in a satisfactory manner, it is almost a matter of necessity to analyze the occupations of the people of this country as they now are. We are enabled to do this with great confidence in the accuracy of our results, because the same census agents who counted the numbers also asked what every one did for a living. Therefore, under the head of occupations, the people of this country who worked for gain were classified by their own state- ments under separate titles. The compilations of the census are made under four general titles, to wit : Occupied in agriculture 7,670,493 " " professional and personal service 4,074,238 " " manufactures, mechanic arts, and mining 3,837,112 " " trade and transportation . . 1,810,256 17,392,099 Thus the proportion of the whole population occupied for gain was substantially one in three of the whole number. This method of sorting is not wholly satisfactory. The writer has therefore made a different compilation under seven titles, as follows : How occupied. I. Mental work. No. in each 1000. 40 Computed total number. 696,000 'Clergymen, 64,968 ; lawyers, 64,137 ; physicians and sur- geons, 85,671 ; teachers and literary, 227,710 ; journal- ists, 12,308 ; scientists and engineers, 8,126 ; musicians, 30,477 ; officers of corpora- tions, banks, railroads, in- surance, etc., 202,423. The Price of Life. 205 How occupied. No. in each 1000. 2. Mental and manual 60 Computed total number. 1,044,000 3. Automatic ma- chinery 4. Mechanical : hand \ and machine tools. ) 100 1,740,000 \ 107 1,861,800 5. Manual 131 6. Horse and hand ) tools S '^° 7. Chiefly manual 312 2,279,400 4,350,000 5,420,899 i 'Merchants and traders, 481,- 450 ; hotel keepers, 32,543 ; clerks, salesmen, commer- cial travelers, brokers, and all others engaged in the purchase and sale of goods, 521,898. Collective factory work : tex- tiles, printing, and bleach- ing, 500,000 ; metals and machinery, 300,000 ; cloth- ing, 450,000 ; boots, shoes, and hats, 210,000 ; all others 280,000. ' Mechanical not collective : carpenters and other work- ers in wood, 500,000 ; black- smiths, 172,726; painters, 128,556; masons, 102,473 J all others, 958,045. Service : express, railroad, telegraph employes (not laborers), 300,000 ; domestic servants, 1,075,655 ; laun- dry, 122,000 ; waiters, 200,- 000 ; draymen, hacknien, etc., 180,000 ; all others, 391.345- Farmers, herdsmen, stock- breeders, and the like, Laborers on farms, 3,323,876 ; laborers not specified, prob- ably in part on farms, 1,857,- 023 ; miners, 240,000. 1,000 17,392,099 It requires but little experience or knowledge of the general condi- tions of men to determine that only a very small })art of those listed under each of these titles are or can be men of wealth, or even in possession of such a considerable amount of property as to make their income derived from property the larger part of their annual resources. Moreover, if it be considered that there is a certain general average of income with respect to each class of occupations, one may reach a reasonably close estimate of the relative conditions or proportions of income of those who are listed under each title. For instance, under Title 2 it will be observed that more than half are in the position of the employed rather than of the employer — clerks, salesmen, etc. — who seldom make large earnings. Under Title 3, those who work upon metals and machinery earn the highest wages. Those occupied in making boots, shoes, and hats probably come next. Skilled labor in the clothing trade is better paid or earns more than skilled labor in the textile factory, while common labor in the clothing trade, even when paid all that it is worth, secures very small earnings. Under Title 4, 2o6 The Industrial Progress of the Nation. mechanics — all are substantially well-paid workmen, earning more than the average of those who work in the factories. As we come down in the list, the numbers relatively increase of those who spend nearly all that they earn in getting a living, of whom very few possess more property than a deposit in a savings bank. The farmers to a very large extent work harder than their hired men, and few become rich. Lastly, nearly one third of the whole number listed could reply to the census taker only that they were laborers. Is this wholly creditable to our system ? If, then, very few come into the possession of any considerable property, while a larger number, but yet a small proportion of the whole, attain an average income of one thousand dollars a year, by far the greater proportion living of necessity on less than $600 a year to each three persons, what can be done about it ? If from the earnings of every man gaining by his work more than $r,ooo a year, the excess were taken and divided equally among those who earn less, the game would not be worth the candle, because the gain to those who received the difference would be but a trifle. The addition to the income of each person occupied for gain would probably not be equal to the price of a daily glass of beer. On the other hand, if this excess of income above $i,ooo a year were taken from those who now enjoy it, to be distributed unequally among the working people, then the same disparity of condition would exist as now, or even a greater. What are you going to do about it ? may well be the question put to the reformer who in his own judgment can remove all the inequalities and do away with all the hardships of life by acts of either the national or State legislature. The way to meet each and all of the theories of the professional agitators or sentimentalists who propose to change all the conditions of society by statute, is to bring the consideration of the subject within a limit easily compre- hended, say fifty to sixty cents a day, and then to call upon each class of reformers to meet the conditions as they now are, and to prepare an act of legislation by which better general conditions may be assured. This they may find a somewhat difficult matter. In subsequent articles their theories will be subjected to this test. The days of dynasties and of privileged classes are numbered ; emperors and kings, dukes and lords, have become superfluous ; feu- dal rights, which could perhaps have been justified in the past, have become the feudal wrongs of the present time. Democracy cares nothing for inherited rank, and may call upon every man to justify his present condition by his service, under the coming democratic rule, not only in this but in many other countries. The Chinese practice of granting titles of nobility to the ancestors of him who now serves his country well may be approved ; but no title gained in the past, unless The Price of Life. 207 sustained by its representative in the present day by corresponding service, will long be tolerated as one either of privilege, honor, or credit to him who bears it. Gunpowder equalized the force of the seignior and the serf ; Vanderbilt became the great communist of the time when he reduced the cost of moving a year's supply of food a thousand miles to the measure of a day's wages of an ordinary me- chanic. Yet more remains to be done before the mass of the people even in the United States can be said to live well. What are you going to do about it ? In this series of articles, and in articles elsewhere published dealing with the same facts and statistics, the writer has proved, by arguments which no one has yet been able to refute or to gainsay, that in this country, which is no longer subject to the inherited wrong of slavery, in which birth gives no privilege, and in which all have or may have equal opportunity to attain material welfare, the working men and women who perform that part of the work of pro- duction which is either manual or mechanical, are steadily securing to their own use and enjoyment an increasing share of an increasing product ; while on the other hand, both the material capital which has been saved in a concrete form, and also the element which is yet more necessary to material abundance, the capital which is immaterial, /. e., the mental factor in all productions, are being placed at the ser- vice of those who do the primary work at a lessening rate of compen- sation or profit. Nevertheless, when all Europe is a prey to fears of anarchy, nihilism, socialism, and communism, and when it seems to be as impossible for the standing armies and national debts of the Conti- nent to be sustained as for the armies to be disbanded or the debts repudiated without violent revolution, may it not be well for us to take an inventory of our resources and to review our present methods of distribution, lest we also should perhaps be called upon, again and again, to apply force in sustaining rights of property both in land and capital, which need no force for their defense when fully compre- hended and justified by the service to humanity which their possession makes their owners capable of rendering in ever-increasing measure. May not the harmony of interest between labor and capital be dis- closed by the statistics of the nation to every one who can read what underlies the columns and is written between the lines ? May it not therefore be well for all to give their attention to what are indefinitely termed the " claims of labor," lest for want of thought, that which is right should be misconstrued and assumed to be wrong by those whose narrow or monotonous conditions of life limit the scope of their thought and may possibly lead them to misdirect their acts. The conclusion of the whole matter may perhaps be brought within the mental conception of any one who believes that there is order in 2o8 The Industrial Progress of the Nation. the universe, and that there is an over-ruling power that makes for righteousness. The lesson which we learn is this : not only does enlightened self-interest coincide with or lead toward moral and mate- rial welfare, but even unenlightened self-interest, as represented by the mere money-getter, the mere capitalist, or by the man who has himself no knowledge of his own function, yet works of necessity in pro- moting an increased product and a reduction in the cost of all the necessaries of life, under which conditions the great mass of the community cannot fail to attain better conditions of welfare. Great inventions, which were first applied within a century, tended to the concentration of great masses of people under adverse conditions in the cities, and also to the diffusion of other great masses of people, occupied in farming, over wide areas, under isolated conditions which were not conducive to the best kind of welfare. The application of steam, of water power, and of gas led to concentration of the factory population. The introduction of the railway led to wide diffusion of the farming population and to " extensive " methods of agriculture. These applications of science are now being met by other great inven- tions, the tendency of which is in the reverse of what has occurred during the present century. The application of electricity to the pro- duction of speech and light, to the development of power, and to the operation of elevated or surface railways by which very rapid transit may be secured, and many other modern methods of distribution, are tending to diffuse many arts heretofore confined to the centres and crowded parts of great cities, throughout the suburbs and adjoining towns, where broad, low, well-lighted, and well-ventilated factories may occupy a larger area of ground, and where the factory operatives may live under very much better conditions. On the other hand, the adoption of the silo, and what are called the " intensive " methods of cultivation, are leading to the breaking up of large farms and bringing the people who are engaged in agriculture into closer communication with one enother. All these new forces are now in accord with the gregarious habit of men, and without overcrowding, will bring about more favorable conditions of life, while promoting an increase of product at a much less cost of labor than ever before, with correlative high wages and low prices. Yet the motive which sets all these new forces in action is the self-interest both of the capitalist and of the workman, each striving to attain personal welfare only, but yet pro- moting the public welfare, whether conscious or unconscious of their true functions in society. It was said by the prophet of olden time that " The Lord maketh the wrath of man to praise him." It might be said by the prophet of the present, that the Lord maketh the selfishness of man to work for the material welfare of his kind. VII. AN EASY LESSON IN STATISTICS.' IN this and in articles which are to follow, I shall endeavor to bring the present condition of the people of the United States into a form of statement which will enable readers to understand the bearing of many questions now pending to whom statistics are apt to be very dry and uninteresting. Persons who are not accustomed to deal with figures in very large sums, and to whom the incomprehen- sible millions of our national book-keeping carry but a confused impression, may easily comprehend the facts on which all fiscal or financial legislation ought to be based when the large sums of the national accounts are reduced to the quantities and values of a corre- sponding community of 6,000 persons. In this essay I have assumed the existence of a community of 6,000 souls whose conditions as regards occupations, industries, production, division, and utilization of land, etc., are as nearly as may be identical with those of the people of the United States in 1880, when the population was 50,000,000, or in the present year, when it is more than 60,000,000. I have made use only of such census figures as I believe to be worthy of trust or which I could substantially verify myself. Disregarding fractions, then, the following computations relating to 6,000 people correspond to the figures which would apply to the present population of the country, assuming that no material change has occurred since the census of 1880 in their relative occupations and production. The figures of foreign commerce have not held quite the same proportions, but in other matters of production and distribution there has probably been but little change. I assume a typical township which covers 300 square miles. It is about 25 miles long east and west, and 12 miles wide north and south. It comprises 192,000 acres of land, of which about one half, or 96,000 acres, is good arable land ; the rest is about equally divided between pasture, mountain, and forest. A little over twenty per cent, of the arable land, about 30 square miles, or 20,000 acres is under the plow. Within this area of 300 square miles there are 6,000 people, of whom 2,000 (1,700 males and 300 females, including 35 boys and 14 girls of 15 years or under) are occupied for gain, or are doing something by which they may get a living for themselves, each one on the average ' Reprinted from the Forum. 14 -09 2 lo The Industrial Progress of the Nation. supporting two others, either in farming, manufacturing, mining, or trading, or in professional or personal services. The 2,000 who are occupied for gain are occupied substantially as follows : 870 as farmers (490) and farm laborers (380), doing their work in part by machinery, mainly by the use of tools and implements driven by horse or manual power ; 226 occupied in personal service — servants, dray- men, hackmen, and the like — doing their work mainly by hand ; 224 laborers not on farms — hewers of wood and drawers of water, diggers, and d elvers ; 214 mechanics or artisans, working where the work is to be done individually rather than collectively, and operating tools rather than machinery ; 200 occupied in the collective work of the factory, operating machinery rather than using tools ; 2>^ employed upon railways — engineers, firemen, and the like — omitting common laborers; 30 miners ; 200 persons engaged in mental rather than in manual or mechanical industry, using their heads rather than their hands — clergymen, lawyers, doctors, literary persons, heads of corpora- tions, merchants, traders, and the like. The study of the occupations of the people may enable one to make a better estimate of their average income or product than any figures which can be compiled in a census ; therefore it may be useful to make even a closer subdivision of these pursuits : Occupied in agriculture : Farmers 500 Farm laborers 37° 870 Occupied in personal service : Hotel keepers 4 Domestic servants, waiters, laundresses, coachmen, and the like 158 Draymen and hackmen 20 Others, including mariners and police 44 226 Common laborers 224 Occupied in the mechanic arts : Carpenters, wheelwrights, lumbermen, and other men who work in wood 5^ Blacksmiths 20 Painters 14 Masons 12 All other mechanics 112 214 Occupied in the collective or factory system : Workers in textile factories 60 Metal workers in blast furnaces, smelting shops, machine- shops, and the like, worked on the factory principle 36 Clothiers, tailors, and tailoresses 5° Boot- and shoe-makers and hatters 24 All other people who work in tlie factory rather than out-of- doors 30 200 An Easy Lesson in Statistics. 211 Occupied on railways, omitting common laborers : Railway engineers, conductors, firemen, and brakemen 36 Miners 30 Occupied in mental work : Clergymen 7 to 8 Lawyers 7 to 8 Doctors 7 to 10 Professors, teachers, musicians, and literary jseople 30 Presidents of corporations, banks, railways, insurance cfrrn- panies, and the like 24 Merchants and traders 56 Clerks, salesmen, saleswomen, and book-keepers 64 200 This classification by occupations is not an absolutely correct one, but it suffices for the general purpose of indicating the con- dition of the people. In former times, before the adoption of the factory system, each little community was to a large extent self-sus- taining. The material for garments was spun and woven in the house- hold. The farmer was a mechanic and almost of necessity a jack-of- all-trades, while the mechanic was apt to do a little farming. The local tailor and tailoress made the clothes. The work of each given community was much less subdivided individually than it has been since. Later came the substitution of the factory system for making cloth, the farmers' daughters leaving the farm and finding occupation in the factory. Then followed the wholesale clothier, and the local tailor as a maker of garments almost disappeared. But another phase of the distribution of work results from the reduction in railway charges. The railway system, by reducing the cost of moving goods to a fraction of a cent per ton a mile, practically converts a wide area into a close neighborhood. Hence there has been a considerable measure of household manufacture again introduced among farmers, but under wholly new conditions. The sewing- machine has become a necessary household implement, and the knit- ting-machine, sometimes owned in the farmers' families, but more often owned by a manufacturer of knit- goods, is widely distributed through- out the farmers' households of the eastern part of the country. The materials for ready-made clothing are cut at the manufacturing centres in the cities by the great clothiers, sorted, and put up in parcels with the thread, linings, and buttons ; or the worsted and woollen yarns are made up in packages with directions for their use. These materials are then distributed throughout the farmers' families in the Eastern States, to be made up into garments or worked into hosiery and knit-goods, sent back to the cities to be pressed and finished, and then distributed for sale. Thus there is a considerable amount of manufacturing car- ried on, especially by the women of the farmers' families, which does 2 1 2 The Industrial Progress of the Nation. not appear in the census returns, and the women thus partly occupied do not appear in the list of those who are occupied for gain. The in- come for such work is small in each individual case, but it adds in the aggregate a large element of comfort and welfare to those whose every- day work is that of doing the household and dairy work among the agricultural population of the country. In the mountain section of the South, again, the old conditions of small self-sustaining communities still survive, but are rapidly disappearing. The people are clad in homespun, while the log-house and most of its contents are the prod- ucts of the handicrafts of the people. We will assume that the typical community is situated upon land in the northern rather than in the southern section of the country, and that the people are a little better off in personal wealth than the aver- age of the whole country. It may be assumed that they dwell in some part of Ohio, in which State the occupations of the people correspond very nearly in their proportions to the average of the whole country. The present value of all the land with all the improvements thereon, including railways, factories, machine-shops, dwelling-houses, public buildings, schools or colleges, and goods and wares of every descrip- tion belonging to this community of 6,000 persons, averages less than $r,ooo per head, and amounts in the aggregate to between five and six million dollars. This property is divided very unequally. The exact proportion of those who own some part of the land cannot be given with any positive accuracy. From two fifths up to one half of the total valuation consists of the estimated value of the land ; from three fifths down to one half consists in the value of the improvements upon it. The data of accumulated wealth are somewhat uncertain, and the census estimates have been computed at different periods on such dif- ferent methods as to be almost worthless for purposes of comparison. The property assigned to this typical community is probably a third above the average of the whole country. The value of all these im- provements or capital of the community, consisting of railways, fac- tories, workshops, machinery, tools, dwelling-houses, and public build- ings, also goods and wares of every kind, does not exceed $600 worth per head of the population, and is probably somewhat less. The average value of the annual product is about $200 per head, or $600 to each person occupied for gain. The capital of this com- munity, in ratio to its production, is therefore equal to that of the rich- est State in the Union. In other words, the whole capital of the com- munity which has been placed upon the land is only equal to three years' product, even in the richest and most prosperous parts of the country. The value of the annual product of this community at $200 worth per head of the population, or computed at $600 worth as the average of each person occupied for gain, comes to $1,200,000 a year, An Easy Lesson in Statistics. 2 1 3 including what is consumed by farmers and their families upon the farms. In this gross value of all that is produced, salable farm prod- ucts, rated at the farm before being moved away, come to $435,000. Assuming that each member of the families of the farmers consumes about %ii worth of the product of the farm at home, the value of the domestic consumption of the farmers comes to $87,000. The yield of minerals of all kinds, coal, oil, iron, lead, copper, gold, silver, etc., comes to $50,000. The yield of the forests is $80,000. The vilue added to the crude products of the farm, the forest, and the mine, by manufacturers, mechanics, and others, together with the charges for exchange and the cost for conversion and re-conversion into a con- sumable form, together with the product of the fisheries, comes to $548,000. SUMMARY. Primary value of the salable products of the farm $435,000 Farm consumption 87,000 Product of the forest 80,000 Product of the mines 50,000 Added in the process of manufacturing and for the cost of distribution 548,000 Total $1,200,000 It will be observed that, setting aside the sum assigned to home consumption on farms, the work of the country is about equally divided in value. The crude products of the farm, the forest, and the mine come to $565,000. The volume added in the process of manufactur- ing or distributing — of conversion and of re-conversion to final use or consumption — comes to $548,000. It is a curious thought that all this huge value of traffic, production, distribution, and conversion has for its end and objective point the supply of each inhabitant with a few feet of boards over his head, sus- tained by bricks or timber ; about ten pounds of wool and sixteen pounds of cotton converted into clothing, a barrel of flour, and two or three hundred pounds of meat each year, and a little sugar, a glass of beer, and about five pounds of solid or liquid food per day, these con- stituting the necessaries of life. Some one has said that life would not be worth living except for its luxuries, and that time would not be worth having except for the hours that could be saved for leisure. How much of luxury and how much of leisure can the average man get out of what fifty to fifty-five cents a day will buy for his shelter, food, and clothing ? It will be observed that 870 farmers and farm laborers were occu- pied in the production of grain, meat, butter, and cheese, vegetables, fibres, and fruit. This group produced more food than the 6,000 people in this community could consume, all having enough and much being wasted. They also produced more cotton than could be spun 214 The ImitLstrial Progress of the Nation. or worn, but not enough wool. The miners produced more copper and silver than could be used and more oil than could be burned, but not enough iron. Some of the manufacturers produced more goods than this community required. Hence it followed that, at the ratio of 1880, $100,000 worth of various commodities was sold for export to foreign countries. Of the exports, $84,000 worth consisted of the products of agriculture ; $16,000 worth consisted of cotton goods, manufactures of metal, tools, and implements, oil, manufactured tobacco, and the like. These figures are now somewhat changed ; the export of farm products is less, of manufactures more. This export corresponded to the work of 150 to 160 farmers and farm laborers, and 30 to 40 manufacturers, mechanics, and miners ; 180 to 200 in all. It consisted of a part of the product of a much greater number, but in proportion to the total the exports of the United States represent the work of about ten per cent, of all who are engaged in any industry which is directly productive. In exchange for this $100, coo worth of goods exported, this community imported from other countries at the ratio of 1880, $75,000 worth of goods, and $25,000 worth of gold or government bonds brought home. The imports consisted of the following articles : Yearly Imports. Sugar and molasses $9, 500 Coffee 7,200 Tea 2,400 Breadstuffs i , 100 Fruits and nuts 1,500 Animals, fish, drugs, dyestuffs, and other necessary articles which are free of duty I5,400 37,ioo Chemicals i,Soo Flax, hemp, jute, and sisal grass 1,100 Iron and steel, and manu- factures 5,400 Hides, leather, and goods 1,400 Tin and tin plates 2,000 Raw wool 2,000. 13,700 Manufactures of Cotton 3,300 Wool 3,800 Flax 2,800 Silk 3,800 Earthenware 600 Glass Fancy goods Spirits and wines. . Tobacco and cigars. Sundries . 600 .... 600 900 800 . . . 14,900 . . . 2,300 7,000 Per Capi ta Each Year^ $1.58 1.20 .40 .18 .25 2.56 •30 .18 .90 •23 50,800 •33 •33 •55 ■63 •47 .64 .10 .10 .10 •15 •13 24,200 1. 19 $75,000 $12.50 An Easy Lesson in Statistics. 2 i 5 It will be observed that the imports from other countries consist to the extent of one half of articles of food, which are articles either of necessity or of common comfort. Adding to these the crude or partly- manufactured articles which are necessary to the conduct of domestic industry, the proportion of this class of imports comes to two thirds of the whole. That part which could be spared, if we could not afford to pay for it with the excess of our grain, cotton, and oil, comes to only one third of the total import ; and that part which may be rightly put under the head of luxuries is but a tithe of the whole. Since 1880 exports have proportionately diminished, but imports have ratably increased about in ratio to population, and the above are about the relative values of goods now imported. The individual consumption of imported goods is now about $12.50 per head, on which the duties come to a little less than $4.00 ; in round figures, $16.00 per head duty paid. The exports are now about equal in declared value to the imports without the addition of duties. As the sum of imports did not balance the export in 1880, the remainder was paid for in gold or bonds. These imports were taxed at the custom- house $24,000, or $4.00 per head of 6,000 people. It will thus appear that about 18 per cent, of the people occupied in agriculture in 1880 depended upon a foreign market for the sale of their product, to whom were added a few manufacturers and mechanics whose goods were sold for export. The export of food and fibres rep- resented 18 per cent, of the products of the farm, to which manufac- tures being added, the whole export stood for 8 to 10 per cent, of the work done by all who were occupied for gain. The import consisted mainly of articles of food or of articles in a crude or partly manufac- tured condition necessary to the work of the domestic manufacturers ; a small part only consisted of articles which could be spared, or which might under other conditions have been made within the limit of the community itself and by its own people. It is admitted that a part of this product of $1,200,000 worth is distributed in payment for rent of land, to owners in whose possession all the occupied land now is. There is still a large area of unoccupied land, but it is not yet available for use and may not be occupied for a long time to come. It is admitted that another considerable part of this product of $1,200,000 worth a year is distributed in the form of interest on bonds and mortgages, these evidences of indebtedness belonging to the few rather than to the many. Still another part of this product is distributed in the form of profits, and falls to the owners of the railways, factories, and other instruments of production constituting the capital of the country, in greater or less proportion according to the measure of service which they render to the com- munity. Another part is distributed in the form of fees or salaries among professional persons, musicians, literary people, and the like. 2 1 6 The Industrial Progress of the Nation. Lastly, the greater part of the product is distributed in the form of earnings of wages among those who do the primary or mechanical work of production and distribution. Such being the measure of the whole product, by so much as some have a greater share must others enjoy less. If the whole sum of $1,200,000 worth were equally distributed, it would not even then suffice to meet a very high standard of general comfort and welfare ; it would come only to 55 cents' worth a day to each person. This is a large estimate if all were consumed in even portions. The whole work of production would still be substantially as great as it is now, and would not admit of any considerable amount of leisure on the part of the whole body of persons occupied for gain. ■There would be little relief in the hard work of getting a living. But, unless some part of this product of $1,200,000 worth of all kinds of goods and wares is saved and added to the capital of the community by some one, it matters not by whom, the next generation will suffer for want of capital. A considerable part of the product is wasted through ignorance or vice, while only a small part is wasted in luxurious living. " Mankind is as lazy as it dares to be," even now. In fact, that part of the product which may be added to the capital of the community must itself be consumed in the process of repro- duction or conversion into capital ; therefore the workmen who con- struct the railways, mills, works, and the like, in which the savings of the community are invested, get their subsistence, clothing, and shelter from what is paid them in doing this work. The object and end of all production is, therefore, in the first instance, complete consumption, the greater part of the product being consumed without specific repro- duction in the form of capital, the smaller part being consumed in the process of conversion into capital. Even that part of the product which is consumed in the more or less luxurious living of the prosper- ous is not wholly consumed by themselves. They may waste a part of their income or devote it to purposes which are not reproductive and are not necessary to comfort and welfare, such as the construction of palatial dwellings, the making of pianos, the laying out of fine places, the building of yachts, and the like ; yet even in this expendi- ture the workmen who do the work obtain their subsistence in return. No man lives to himself alone even in a material sense, and each one costs the community only what he and those dependent directly upon him consume on their own persons. What he spends stands for the subsistence of other persons. The rich man or the capitalist merely gives a different direction to the consumption of that part of the annual product which comes under his control from what it might otherwise have taken. It may be neither the most useful direction, the wisest, nor the best ; it may even be wasteful ; but even such methods of expenditure cannot be changed without altering the conditions of An Easy Lesson in Statistics. 2 i 7 life and taking away the incomes of many of the workingmen, among whom the rich man expends his wealth. Liquor and tobacco are computed to cost consumers $75,000 to $100,000 a year in each average community of 6,000 persons. But if each producer or distributer of these articles averages the same income as in the other occupations — to wit, $600 each — then 125 to 167 men supporting 375 to 500 in each average community of 6,000 people, or 1,250,000 to 1,650,000 men supporting 3,500,000 to 5,000,000 men, women, and children in the whole country, now depend on the production and sale of liquor and tobacco for the means with which to buy their own food, fuel, clothing, and shelter. If the production and sale of liquor should be stopped they must find other work. Under the present distribution of occupa- tions and of products, does any one actually suffer because a sufficient quantity of the necessaries of life is not produced ? So long as no one suffers for lack of land or for want of opportunity to work for a living in consequence of the accumulation of wealth, may not the true remedy for want consist in the ignorant rich learning how to spend or direct the material force which comes within their control in a better way ; and in the ignorant poor learning either how to spend or to save the force which comes within their control in a way that will give them better results ? The waste of the many poor costs the community in the aggregate far more than the waste of the few rich. True progress may consist not in taking away from any, but in adding to the produc- tion of all, especially of the means for shelter. It may well be remembered that the science of distribution is as yet but little comprehended, while production in ample measure is abso- lutely assured. It is less than a century since even the English-speak- ing people began to learn the very alphabet of commerce ; has that part of the English-speaking people who occupy this country yet learned how to spell words of more than one syllable in putting together the letters of this alphabet ? They have learned that trade among them- selves has become profitable to all just so far as it is free from ob- struction ; have they yet to learn that trade with other nations may be as profitable when free from obstruction ? Have they not yet to learn that the nation in which the wages or earnings of workmen are the highest, because they make their products under the best conditions and there- fore at the lowest cost, can also gain the largest profits and earn the highest wages from the widest international commerce ? We sell to China coarse cotton goods made by weavers who earn a dollar a day ; yet four fifths at least of the people of China are clothed in coarse cotton goods woven on hand-looms on which the weavers cannot earn more than ten cents a day. They pay us in tea produced and prepared at wages of ten cents a day, which we could not afford to grow at wages of one dollar a day, even if it would grow in this coun- 2i8 The Industrial Progress of the Nation. try, because we cannot spare the time for that kind of hand-work. We sell flour produced at wages four times as high as they are in Belgium, in competition with the tillers of small fields in that country, to which machinery cannot well be applied. We take our pay in part in high- priced Brussels lace, made by women who work for the lowest wages and under the worst conditions of almost any people in Europe. If we want the lace we could ill afford to make it under such conditions. In the community of 6,000 people which I have taken as an example there may be a few paupers, mostly foreign-born ; but no one in this community is allowed to suffer for want of the absolute necessaries of life, except through oversight or accident. I have given the probable average product of each person occupied for gain at $600 worth per year. This yields, disregarding fractions, what fifty-five cents a day will buy in the form of food, fuel, shelter, clothing, and sundries for each man, woman, and child ; so close does want tread upon the heels of plenty. This is in fact a large estimate. There are a great many more people whose product is less than fifty cents' worth a day each for themsel\*es and those dependent upon them, than of those who earn more ; yet this is the richest, most productive, and most prosperous country in the world. VIII. REFORMS THAT DO NOT REFORM.' ASSUMING the conditions of an average community of 6,000 people to be substantially as stated in the last number, we find but three ways of improving them, namely : First, by increasing the quantity of the product, and finding a market for the increase, in or- der that it may be converted into money and distributed. Secondly, by changing the present methods of distribution of that which is now pro- duced, without increasing the quantity ; that is, by finding a way by which those who have not quite enough for comfort and welfare may rightfully secure a share of that which is wastefully consumed by those who have too much or who spend unwisely. Thirdly, by improving the mode of using what is now produced, without increasing the quantity or materially altering the present method of distribution, so that it will yield a better subsistence to all. What is now somewhat indefinitely called the " labor question " must of necessity consist in solving one or all of these three problems. What other way is there to improve the conditions of the community ? If all that is produced by each average community of 6,oco people comes within the limit of what will sell for $1,200,000, or what that sum will buy at present prices, surely that fund constitutes the source of all earnings, wages, rents, profits, and taxes. We can consume no more unless we can re-convert into food, fuel, and clothing a part or all of the capital of the country which has been saved in our two hun- dred years or more of existence, amounting to less than three years' product, the whole of which, if consumed, would save us only two or three years' work and serve us only until it was exhausted. What should we do then ? We cannot have more than all there is ; therefore the limit of all that is produced must be regarded in all plans of social reform by all alike. This fact must be considered by the anarchist, the socialist, .he communist, the advocate of the single tax on land, the representative of the Anti-Poverty Society, the wage-earner, the co- operator, the knight of labor, the profit-sharer, the free-trader, the protectionist, the eight-hour advocate, the advocate of fiat money, the ' Reprinted from the Forum. 219 2 20 Tlie Industrial Progress of the Nation. mono-metallist, and the bi-metallist. The theories of all these doctors of social philosophy — quacks, or regular practitioners — must deal either with what is now produced or else with plans and methods by which the gross product can be increased and more equitably dis- tributed. The question in plain prose is, How much can you add to fifty cents' worth a day ? If, then, the average product at retail prices is what I have estimated, to wit, not exceedmg fifty cents' worth per day for each person, from which sum all profits, wages, earnings, and taxes must of necessity be derived ; or even if I have made an error of five or ten cents a day, which would come to one thousand million or two thousand million a year in computing the gross value of the product of the United States — not a probable error ; then fifty-five to sixty cents a day is the limit, and even that limit is a very narrow one ; it leaves little margin for saving either time or work. This special community of 6,000 persons would have furnished itself, according to the average of the whole country, with fifteen miles of railway ; but being a more prosperous community tlian the average, it has perhaps twenty, thirty, or possibly forty miles. Of the 2,000 persons occupied for gain, 140 may be engaged either in operating or in constructing railways, 36 as engineers and firemen or other em- ployes, the rest as mechanics and laborers. Of the nineteen to twenty million men, women, and children now carrying on the work of this country, probably more than twelve hundred thousand men are occu- pied either in operating or in constructing railways. This railway force is our standing army ; while other nations prepare for war we prepare for peace and plenty by opening the ways for commerce. It is curious to observe that the only relics of the great Roman empire which now have any actual utility among men are the Roman road and the Roman law. The one, which was constructed to open the way for conquest, remains an open way for commerce ; the other remains at the foundation of our civil organization ; all else has vanished except Roman literature and art. Of all the forms of capital which at the present day are springing into existence, perhaps less will remain even a century hence than now remains of the capital or prod- ucts of the Roman empire, if we except the opening of the ways. The term " fixed capital " is sometimes used to distinguish the less perish- able forms of capital from those which are useful only for the day ; but there is nothing fixed except the law of change. There are factories in existence which purport to be fifty years old ; but within that time the motive power and all the machinery has been changed once, twice, or thrice. Where land can be had, true economy may now consist in taking down the high building of five or six stories piled one upon an- other, and in reconstructing the mill only one or two stories above the Reforms that do not Reform. 2 2 i ground ; such changes are now being made. Who can tell when the next inventor will appear who will destroy all the rolling-stock of the railways ? Who can tell how long people will be satisfied with the present crude and unscientific methods of constructing dwelling- houses ? What useful factor or form of capital exists in a material form to-day that is more than a few years old ? What permanent im- provement have we made on the face of the land even in this country, except in leveling the hills, piercing the mountains, filling up the val- leys, and laying down the ways of commerce ? All that we can do is to move something ; we can make nothing. And when we have opened the way, laid the rail, and brought the line to the seaboard, why do we obstruct the distribution of our own products ? Why do we construct legal barriers to commerce with Canada and Mexico, for instance, more difificult and costly to surmount than any of the heavy grades over the mountains. This community of 6,000 people would have furnished itself, at the average of the whole country, with $150,000 in lawful money, consist- ing of gold or silver coin, legal-tender notes receivable for taxes, con- vertible bank-notes, and certificates based on silver or gold. The more dense the population, the greater will be the proportion of checks sub- stituted for actual money ; and the more widely scattered the popula- tion, the more actual money must be carried in the pockets of the people. All we have to do is to keep the quality of the money good and the quantity will take care of itself. It is admitted that there may be a small margin of error in each and all of these computations. The proportion of people engaged in the different arts varies materially in different States, but it is not necessary that the proportions assumed should exactly correspond with those of any particular State. These small figures represent very nearly the proportions of the work and of the product of the whole community. In taking the United States Census returns of the occu- pations of the people, the margin for error is small, and the errors would alter the proportions assigned to each occupation in this small community only by a fraction. We have become so accustomed to treat income in terms of money that a person is apt to stop at the figures without giving thought to what the money will buy. Now the money measure of the income is but an evidence that productive work has been done from which the income has been derived. The work itself varies in quantity and quality ; the income of each person depends more upon the quality than upon the quantity of his work. Therefore the apparent paradox comes within easy comprehension, to wit, that in determining the cost of any given service the rate of wages in money is no sure standard, but if the quality of the work from which the wages or earnings are 2 2 2 The Industrial Progress of the Nation. derived is good, the rate of wages will be highest where the actual cost of production is lowest. Again, the rate of earnings not commonly called wages but counted under salaries or profits, will be highest in proportion to the quality of the mental factor by which the manual or mechanical work is guided. In this, again, the j^aradoxical rule will hold good, that the highest earnings or salaries and the largest profits are derived from the largest product made at the lowest cost by the payment of the highest wages which the sale of the product will permit, and by the application of the most effective proportion of mental rather than of manual work. It is in this way that the function of the capitalist is justified. By his mental power in guiding and controlling the appli- cation of capital in the most effective way, he adds to the product of the community tenfold or twenty-fold what he takes from it for his own consumption. He thus reduces the cost of all production, and increases the real wages or earnings of all the manual or mechanical workers who join with him in the conduct of all the industries and occupations of the country, because he not only assures the highest wages to those who perform the most skilful and effective work, but he is engaged in a perpetual effort to make his capital more effective, so that the proportion of his capital to the quantity or value of his product steadily diminishes. Under this imperative law the rate of wages of the workman is raised, and at the same time each dollar or unit of the wages will buy more of the product of the establishment in which he works, or more of the materials for shelter, food, and clothing for which the product of that factory may be exchanged. If such are the methods of progress under the competitive system which now prevails, we may well hesitate in attempting to reconstruct society by any of the processes submitted by ardent reformers, whether quacks or regulars. Now, then, how can we reform, change, alter, or improve the present condition of any 6,000 people consisting of a few rich, a considerable number of well-to-do, a large number of busy, fairly well-housed, and fully nourished working people who are engaged in all the arts of life, and a moderate proportion of poor ? There are Protestant and Cath- olic, temperate and intemperate, well-instructed and ignorant, as there are in each community wherever we take the average. It is possible that many difficulties may arise in the application of special and theoretic methods when the attempt is made to deal in a practical way with this typical community of 6,000 people, which do not appear to the minds of those persons who think they can reform the whole na- tion by an act of legislation. Many men think themselves fully com- petent to regulate the operation of 150,000 miles of railway and to bring it all under very simple rules, but I have never found one who Reforms that do not Reform. 223 was willing to take the whole regulation, charge, and direction of the bakers' carts, the butchers' and grocers' wagons, or the job teams of a single city, or to attempt to reduce the cost even of distributing bread after it is baked. The distribution of bread after it is baked now costs the average workman in a city as much as it does to grow the wheat, mill it, barrel it, move it 1500 miles, and convert it into bread, all put together. If the theories of obstruction and regulation which have been attempted in the control of the railway system were fully applied to the traffic even of a city of moderate size, it would almost surely happen that some of the inhabitants would starve every week unless put into the almshouse. It is easy to imagine the conditions of a small community of 6,000 persons, some of them far distant from the rest in the outskirts of the 300 square miles occupied, others living in closer neighborhood, as in villages ; while in a district close to the coast-line there may be a town in which people are crowded together as they are in many of our large cities. We can also imagine in each community a certain number of " cranks," a certain number of dishonest people, a certain number of thieves who steal either within or without the forms of law ; also a certain number of sentimentalists who, finding things all wrong, are absolutely certain that they can put them all right ; and also a certain number who promote pauperism by indiscriminate almsgiving ; finally, a good many who think they could build up a community, if they only had their own way, in a much better form than that in which this community finds itself. Would it not be judicious to apply a little common-sense to some of the methods which are indicated by the names or titles already given to the several classes of social reformers and economic theorists ? We may perhaps find in each community of 6,000 people one or two anarchists, who have been bred in a foreign land under a despot- ism, and who think that because there may be no way out from that despotism except by assassination or by the destruction of all existing forms of society, therefore the same methods should be applied in this community ; so they shoot a policeman in place of a military ruler. Is there any better way of dealing with them when they become vio- lent than the Chicago method ? There will be a few socialists, or advocates of what is called the collective method of regulating society under the control of the state, who desire to bring all the property of the community under state control, and to do away with private enterprise and private property both in land and capital. They present a grand scheme under which every one shall have enough and none shall have too much. Suppose this grand scheme limited to the conditions of any 6,000 people, 2,000 of whom — men, women, and children — are occupied for gain, per- 2 24 ^^ Industrial Progress of the Nation. haps one in five of whom may be a voter or a man of arms-bearing age, and of whom 800 may sometimes vote. Now in what community of 6,000 people will any considerable part of the 800 men who vote, or of the 800 women, a part of whom want to vote but who are not permitted, ever agree to put the conduct of all the business and the control of all the capital, all the farms, factories, forest, and mines into the hands of the town officers by a majority vote ? Who would be the aldermen, the councillors, or the selectmen chosen to become the managers of all the railways, factories, shops, and warehouses? How would they be selected ? What would be the condition of the civil service of that community? Who would be "boss"? Would such a method of controlling the capital of the community increase the product so that there would be more than $200 worth per head each year, or about fifty cents' worth a day per head ? Would this plan be apt to improve the methods of distribution ? If it did not, who would be any better off ? If, on the contrary, it were to diminish the present product and put the distribution under the control of the superintendent, might not a good many people starve who now get some sort of a living ? Is not despotism, either of one or more, the necessary complement of socialism ? Fully admitting that there are many functions of society which the state or the municipal corporation can perform for the citizen better than they can perform them for themselves, yet if it would be manifestly impossible even for a small town of 6,000 people to charge the officials with all that the advocates of socialism or of the collective system propose, is it not yet more im- possible for the Congress of the nation to interfere in the direction of many of the functions now attempted by it ? The communist, of whom a few examples are always to be found in every community, proposes to divide the annual product equally among the members of the community — to have all things in common. There have been some examples of successful communism in a limited way ; as, for instance, in the Shaker communities ; but the Shakers impose a strict limit upon population, besides requiring an equal distribution of the products of labor. This is logical. The general application of their principle would lead to complete success ; that is, there would be enough for all, for the reason that all would soon be none. When we ask a communist whether or not the application of the policy sug- gested by him would lead to a product exceeding that of the present day, about fifty cents' worth daily per head, he is incapable of giving any affirmative answer ; all such undertakings which have assumed any importance, except that of the Shakers, having failed and broken up. Of late, the renewal of the proposition long since presented by the economists who were known as the physiocrats of France, that all value comes from land, coupled with a plan for collecting the entire revenue Rcforius tJiat do not Reform. 225 of the country by the imposition of a single tax upon the value of land, has led many hopeful persons to believe that the panacea had been found, and that all that is needed to bring about uniformly better con- ditions is to adopt the single-tax system and to organize anti-poverty societies. It is held by them that the rent of land would be more than sufficient to meet all the expenditures of city, town, State, and nation combined, and that by so converting what is now paid as rent into taxes, no rent could thereafter accrue to the benefit of private persons. The advocates of the single-tax system admit that the private posses- sion of land is necessary to its productive use ; they only propose to tax land more and other property less, and they object only to the private possession of land under any other conditions than their own. There is no absolute private ownership of land in this country. All land is now held in conditional possession only. It is subject to the right of eminent domain, subject to be taken for public use, and sub- ject to the condition of paying taxes lawfully assessed upon it. It therefore follows that the advocates of the single-tax system propose only to change the conditions under which land shall be held in private possession hereafter, as compared with the conditions under which it has been so held heretofore. Will this change increase the product ? Will it tend to the application of more capital or of less capital to the improvement of land. Raw land has no value. When a high price is paid for a corner lot in a city it is paid for the choice of position, not for any inherent value in the land itself. Until the town house is built upon it the corner lot will yield neither rent nor tax. Where land can be occupied and used the highest price is paid for the selection, in order that the occupant or possessor of the corner lot may distribute the greatest amount of products at the lowest charge for the service. Land attains value only in proportion to the labor and capital which are ap- plied to its use and occupancy. There is more free land waiting to be used at this time in this country than ever before, for the reason that capital applied to the construction of railways has brought the whole country within the reach of settlers at the lowest possible cost. In the older seaboard States land is available for use on better terms than it could have been obtained by the original settlers, who paid nothing for it, and who were not subject to any rent, for the reason that the greater part of the agricultural land of the Eastern States could now be pur- chased at much less than the cost of clearing and improving it, or at less than the cost of the buildings upon it. It is also probably an error to suppose that the present rental value of land, taken by itself, including that somewhat indefinite factor, the so- called " unearned increment," even it it could all be converted to public use in payment of taxes, would suffice to meet the necessary expenses of government even for State, city, and town purposes. For several years 2 26 The Industrial Progress of the Nation. the assessors of the city of Boston, where the present valuation of land is very high, have kept the valuation of land for the purpose of taxation separate from that of buildings and personal property. The valuation of the city for the year 1888 was $764,000,000, on which a tax is to be assessed of $10,000,000 for city, county, and State pur- poses, at the rate of $13.50 on each $1,000 worth of property. Land and buildings are assessed nearly if not quite up to the market value. Personal property is reached by the assessors of the city of Boston in larger measure than in any other city in the country. At the average of recent years, the value of land is $333,000,000 ; of buildings and improvements, $230,000,000 ; of personal property, $201,000,000. In order to raise $10,000,000 revenue the tax upon the whole must be $13.50 on each $1,000. If the assessment were made upon real estate, including land and buildings, the rate would be $17.75 5 or, making allowance for abatements, $18.50. If assessed on land value only, the assessment would be a little over %'SZi allowing for abatements about $35, on each $r,ooo. It is doubtful if the rental now obtained by the owners of all the land of Boston would more than meet the $10,000,- 000 expenses of the State and city, omitting wholly the amount re- quired by the nation. It must be remembered that our national taxes amount to a sum as large, if not larger than all the State, county, city, and town taxes combined. Let it be assumed that all the taxes are levied upon land at $35 per $1,000 : the first question which arises is, Would not this heavy rate immediately depress the value of land ? It has done so in other cases where even indirect taxes upon land customarily assessed upon occupiers and not upon owners have become excessive. I heard of good land in England last summer on which the rates and tithes were so heavy that its market value was only five shillings an acre. The rates, tithes, and other burdens upon wheat land in Great Britain, where there is almost no direct tax upon land value, come to more than the entire cost of producing wheat in Illinois, Minnesota, or Dakota. If the value of land were thus reduced, the revenues would of necessity be derived in some other way than by an assessment on value. It would then become necessary for the city assessors to determine the relative rental value and not the salable value of each parcel of land ; they must then assess a tax on it in the form of rent without regard to what it would bring in the market. The end of that would be that the city would become the landlord and the assessors would fix the rent. How would they change the rental from time to time, to meet new conditions as the value of each particular site for use or occupation changed, permanent possession of land being admittedly necessary to its productive use and occupancy ? When the rental tax had been fixed for a long term — without which fixity of Reforms that do not Reform. 227 tenure no permanent buildings would be constructed, — if the site value increased the tenant would sell his lease for a bonus and thus secure the unearned increment. If the site value decreased, he could no longer pay the tax ; who would compensate him for the unearned decrement ? Witness the failure of the attempt to fix judicial rents in Ireland by the decision of a court. In many cases the tenant has secured a reduction by representing to the satisfaction of the court that he could pay no more. As soon as the rent has been fixed, the tenant has sold his new lease at a large bonus or premium. Who would put a building upon land under such a no-private rent and single-tax tenure, unless he could obtain a permanent lease from the authorities at a fixed rental or an agreement for taxation at a fixed rate ? Who would then put a building upon such land unless he could obtain the average income from his capital, and unless he could recover in addition thereto the rent or taxes due to the city, from those who should occupy or use the buildings upon the premises ? Would land subject to an annual tax of $35 per $1,000 on the present value be more widely distributed than it now is ? This tax must be the first lien upon the land ; could any man except a large capitalist afford to occupy land on such terms ? How would a single tax on land affect farmers, who can now barely earn the tax imposed on their land and who seldom get more than a fair return for their labor out of their land as compared with the returns from other occupations ? Most of the farm land of this country is no-rent land ; it yields no more than a fair return for labor. How would country towns obtain any revenue, where all the land yields but a meagre support to those who either occupy or cultivate it ? The fallacy of this proposition lies in the fact that land is the only source of primary production, and is not the only source of income. If taxes are to be strictly assessed on land in ratio to its capacity to yield rent or a rental tax, then the possession of land in the hands of those most capable of using it as an instrument of the utmost production must become necessary in order that the tax may be met. Low-taxed land now serves for the support of many who have neither the capital nor the capacity to get the utmost production from it ; but if all taxes are put upon land only and the rate thus becomes very high, it can be used or cultivated only in the most productive way, and this implies large capital and full capacity. Would not this again tend to the con- centration of land in fewer hands than now possess it ? Would not the capitalist, or any other person who might possess the land under the new conditions, be enabled to distribute the whole of the single tax among the consumers of all products more surely than he does now ? Finally, would this change in the system of land-tenure lead to an increase of production ? If the present product is fifty cents' worth 2 28 The Inditsirial Progress of the Nation. per head of the population, more or less, what would be the effect of the single-tax system in increasing or diminishing this product ? When the advocates of this system put their proposed measure into the form of a bill to be submitted to any legislature, their difficulties will begin and the fallacy of their reasoning will at once become plain. I may suggest that it is often a sufficient test of an a priori theory to ask the proponent to put his proposed system in the form of a bill to be passed upon by any legislature. This brings the subject to a practical issue, and in nine cases out of ten the theorists are incapable of framing an act that will work, because their propositio/is are impracticable. IX, HOW SOCIETY REFORMS ITSELF.' THE advocate of co-operation holds out the expectation of great benefit to the community by the adoption of that system, especially when applied to distribution. One may ask those who prefer this method, If you desire to co-operate, why do you not co-operate ? There is nothing to prevent, except the one fact which is commonly overlooked, namely, that the small margin of profit which now suffices to maintain the great shops of this country, dealing upon the cash system and upon the principle of large sales and small profits, leaves little or no fraction to be saved by those who choose to co- operate in some other way than by buying at such a shop. The highest city rents are paid by the great shopkeepers for warerooms in central locations, in order to be able to distribute goods at the lowest cost, because such places are most convenient for their customers. The customers save more time and labor for themselves by going to these great shops in the trade centres, on which the highest rents are paid, than they can save for themselves by going long distances to small shops widely scattered, or by attempting to share the small mar- gin of profit by going into the business of co-operation. It is also probably an error to suppose that the big shops eat up the little ones. The vast increase in the mass of commodities to be distributed in recent years makes the big shops necessary to do the additional work, while what are now small shops in the smaller cities would have been great shops in the great cities thirty or forty years ago. The largest dealers do their work at the least specific charge or profit on each transaction ; it is only in the small shops, especially in those giving credit, that the cost of distribution is high in proportion to the amount of the business done. At a recent convention of the representatives of co-operative distribution in Great Britain, where long credit, even on retail purchases, has engendered high cost in distribution, it appeared that the profit saved and divisible among themselves amounted to more than twelve per cent, on the gross sales. It is well known that the co-operative shops on a cash basis sell at lower prices ' Reprinted from the Forum. 22g 230 The Industrial Progress of the Nation. than the private shops. Where is the great shop in any city in the United States in which the net profit is even half of twelve per cent, on the gross sales ? The largest fortunes are made on a much smaller margin of profit. On the other hand, the rents, charges, and expenses of the great shops, large as they are in the aggregate, come to a very small percentage on the gross sales, while in the management of the separate departments of these great establishments, large numbers of men attain success as business men who have failed in their attempts 10 transact the same business wholly on their own account. The operations of the great banks are probably conducted at the least margin of profit on each transaction, as compared with all other branches of commerce. It is for this reason that in all times and in all places, since banking became one of the necessary factors of com- merce, the highest mental qualities of judgment, prudence, and fore- sight, as well as the highest moral qualities of honor, probity, and truth have been called for and have been found in those who have conducted the great banking houses of the world. On the other hand, there is no truer standard by which to measure the general intelligence and integrity, or the want of these characteristics, in a given com- munity, than by the support or obstruction which its members may give to the establishment of a well-developed system of banks and banking. We may therefore ask the advocates of co-operation. Would your method increase the general product or decrease the cost of distribu- tion so that each one might get more for his fifty cents than he gets now ? Can you save any thing in the general cost of distribution ? If you can, why do you not co-operate ? So far as legislation is con- cerned, the way is open. Another proposed panacea is that of profit-sharing. In one way this has been an established method ever since the factory system was introduced. Payment by the piece is but a system of profit-sharing without imposing upon the workman any responsibility for losses. It lies at the very foundation of the rule that large earnings are the correlative or complement of a low cost of production ; it is also con- ducive to greater profit in any branch of industry to which it can be applied than employers can secure by any other method. Profit-shar- ing in this way is, however, very different from the conception of those who advocate it as a more just method of distribution than the present system. It is commonly assumed that the share which now falls to capital under the name of profits is very large, because such profits have been the source of many great individual fortunes. In this again it is not safe to reason except on the basis of facts. In many arts the share, or profit, falling to the capital invested may be equal to the whole sum of wages paid out in the conduct of the work ; yet this How Society Reforms Itself. 2 3 1 profit may be but a very small fraction on each unit of product, and may represent but a very moderate percentage upon the capital used, in proportion to the risk taken. In almost all the primary |)rocesses in the production of metals, in many branches of metal-working, and in the textile arts, the capital required in the mills or works comes to a thousand dollars or more for every man or woman employed. Heavy stocks of material must be carried, from one half to three fourths of the value of the finished product may consist of the cost of the materials purchased, and the total annual product may not much exceed the amount of capital invested. In other arts, such as milling grain, packing meats, and the like, the cost of materials may come to even ninety per cent, or more of the value of the completed product ; hence even a mere fraction of profit on the outlay for material may amount to a larger sum than all the wages paid in that branch of pro- duction. If great fortunes are made on these small margins, it is because those special branches of work are the very ones which require not only the largest proportionate amount of capital but also the very greatest ability in the management. It follows that the ratio of profits to the work done is only that which will bring into the business the necessary capital and ability com- bined ; therefore any system which should propose to give to the work- man any share of this small margin, without his taking a corresponding share in the risk of loss, would of necessity result in restricting the work itself. Only those who are specially protected for a time by patents, by combinations or trusts, or by special legislation, can resist the ten- dency of profits to a minimum, because the competition of capital with capital works steadily toward the reduction of all profits to the measure of that rate which is necessary to attract capital and ability to the work, without which the work will not be undertaken at all. Many intelligent attempts have been made on the part of great capitalists or employers of labor to introduce the system of profit- sharing, according to the reformers' conception of that term, for the joint benefit of owner and workman alike. If such joint benefit had been the result, would not the system have become general ? Has it been found, as a rule, to promote an increase of product or a diminu- tion of work ? Has it added to the sum or mass of the product of the community ? Unless this method should either add to the present product of fifty cents' worth per head per day or reduce the cost of making that product, what effect would it have on the general condi- tion of society ? The advocate of protection to domestic industry by means of a tariff, alleges that the taxing of foreign imports will greatly increase the general product, and will in the long run diminish the cost of the protected article. This system may undoubtedly give a different direction to the 232 The hidustrial Progress of the A^ation. work of a particular community, but is it not in the nature of things of very limited application ? In a given community of 6,000 people divided substantially like the example already given, 2,000 doing the whole work of the community, can more than from six to ten per cent, be found who now make or can make any thing which could be even in part imported from any foreign country ? If more, how many ? A glance at the distribution of occupations and a little thought given to the kind of work done by each class, may be all that is necessary to answer this question. Moreover, can the articles which are imported from a foreign country be paid for in any other way than by an ex- change for or export of domestic products ? Is not all international commerce of necessity a mere exchange of equivalents, unless when a foreign loan is negotiated ? In the community taken as an example, the export trade, corresponding to the import from without, appears to give employment to a greater number of persons than are occupied in the arts of which a part of the product can be imported. If this exchange of products is wholly or in part prevented by duties upon imports, will the final effect be to increase the general product of the whole community to a sum or mass more adequate than it is now ? If so, how much ? And how will the gain be distributed ? Will all get a share or only a few ? Will many pay the cost in order that some may gain ? Is not this system rather one which gives a different direction to industry than one which promotes an increase of the gross product ? On the other hand, the advocate of free trade alleges that if imports were not obstructed by taxation there would be a large addition to the general product of the whole country in consequence of this free ex- change, and thereby domestic industry would be most effectually pro- moted. But to him the question may be put, How large a market can you find for the excess of domestic products which we cannot consume at home ? How much would your domestic product be increased if there were no obstruction to the import of the crude or partly manu- factured commodities necessary in the processes of domestic industry ? If by admitting crude or partly manufactured products you add to the power of domestic manufacturers to supply the home market with finished goods, would you not then diminish the import of finished goods .-* May you not then only alter the conditions of distribution ? How much can you increase the general product of the whole community above fifty cents a head, or whatever it is now, by altering the condi- tions of foreign trade, in which perhaps less than twenty per cent, of the community can have any direct interest either as exporters or im- porters ? Must not exports and imports substantially correspond with each other in value, unless we become heavy borrowers of capital ? Would not foreign exports soon cease if we demanded only coin in exchange ? Would not one or two years' trade drain every bank in Europe, and if we secured the coin, should we have any use for so Haw Society Reforms Itself. 233 large a quantity in our domestic traffic ? If the whole volume of im- port and export constitutes but a small part of the total traffic of this country, does not the tariff question become one of the minor forces rather than a prime factor ? Yet although our foreign traffic may not be a prime factor in ma- terial welfare, is it not a sort of balance-wheel on which the steady and continuous movement of the exchange of all domestic products among ourselves must mainly depend ? It is doubtless true that the home market takes by far the greater part of the products of agriculture, but is not the price established by what even a small excess will bring for export ? It is true that while the manufacturing portion of the com- munity are large consumers of foreign products, farmers and farm laborers are the largest consumers of manufactured goods. If domes- tic manufactures are promoted in any suitable manner, doubtless the demand for farm products may also be increased ; but if the method of promoting domestic manufactures is one which stops or diminishes the export of farm products, will not the demand for farm products, of which our exports mainly consist, be correspondingly reduced ? Can the farmers be then as good customers for domestic manufactures ? Would they gain as much or as rapidly in the home demand as they might lose on the foreign sales ? Now, since the excess of our farm products cannot be sold for coin only, and can be disposed of only in exchange for foreign goods, does it not follow that any obstruction to the import of foreign goods also checks the export of farm products, and diminishes the power of the farmers and farm laborers to buy domestic manufactures ? If a method of promoting domestic manufactures is adopted which di- minishes the power of the principal consumers of manufactured goods to buy them, may not this system work a grave injury even to those for whose benefit it was instituted ? These conditions must be considered in all their bearings before one can determine whether any thing can be added to the fifty cents' worth a day, more or less, of our products, by attempting to give one direction rather than another to the industry of the country my means of tariff legislation. In the community of 6,000 people which we have taken as an ex- ample, of whom 2,000 are occupied for gain, 870 are farmers and farm laborers. If we divide persons by the proportion of the value of the different products of agriculture, it will appear that not exceeding five per cent, of the farmers of the United States, or 44 of the 870 em- ployed in agriculture in our typical example, are occupied in the pro- duction of sugar, tobacco, flax, hemp, wool, and a few other articles which could be imported in part from any other foreign country except Canada. We now sell more products of agriculture to Canada than we buy from that country, therefore Canada may be left out of this consideration. On the other hand, from 160 to r8o of each 870 2 34 The hidustrial Progress of the Nation. persons occupied in agriculture in 1880, depended wholly upon a for- eign market for the sale of their product. Again, the 'whole number of persons occupied for gain in work done in factories, mines, and metal works, — that is, those who are com- monly called manufacturers, — is 230 in our example ; and the product of 30 or 40 of these is exported. How many of those engaged in the manufacturing arts are employed upon products which could be in part imported ? This question cannot be answered until the crude or partly manufactured materials of foreign origin which enter into the processes of their work are free from taxation ; such as wool, ores, iron, steel, hemp, timber, chemicals, dyestuffs, tin plates, as well as the machinery with which they work. No one can rightly measure the power of this community, not only to supply itself with manufactures but also to supply foreign nations with manufactured goods, until the disparity in the cost of materials which ensues from the taxation on imports of these materials is removed. All other machine-using nations, with hardly any excep- tion, admit free of duty the crude or partly finished materials which are necessary in the final processes of manufacturing. We do not ; therefore we have as yet had no experience by which we can test our own power either to supply our own markets or to supply foreign countries with finished goods. When this fact is considered, the difficulty of measuring the effect of tariff legislation, either in pro- moting or in obstructing the work of a part of the people of this country, begins to be apparent. The tendency of invention and of the application of science to production and distribution, is to reduce all prices, to raise all wages, and to diminish the proportion of the product secured by capital in the form of profits. Does not any disparity or disadvantage in the cost of materials which enter into the processes of domestic industry become greater as the absolute prices of the materials are reduced both in this and in other countries ? In the community of 6,000 people taken as an example, the pro- portion of the imports of foreign goods (valued at ^75,000) taken in exchange for exports would be about as follows, on the basis of im- ports for the last decade : A Articles of food, or live animals 32 per cent. $24,000 B Articles in a crude condition which are necessary in the processes of domestic industry 23 " " 17.250 C Articles in a partly manufactured condition which are required for use in domestic manufactures 12 " " 9,000 D Articles fully manufactured ready for consumption 21 " " 15. 75° E Articles of luxury or of voluntary use 12 " " 9,000 100 $75,000 How Society Reforms Itself. 235 It will be observed that the taxes imposed upon Classes A, B, and C, omitting D and E, in the community of 6,000 people, came to $12,- 500 out of $24,000, collected in the form of duties upon imjjorts. What would be the power of such a community to sell its finished products outside its own limits if this disparity were removed ? The burden of a tax is not in its actual ratio to the value of the taxed product, but in its ratio to the profit which might be made in making use of that taxed product as a component material in other manufactures. Can any one measure the power of this typical community until the disparity in the price of iron, machinery, tools, timber, steel, wool, hemp, flax, and other crude materials shall be removed, by which it is now placed at a disad- vantage in competing with other communities ? Again, how can greater mischief be done than by bad methods, even of removing bad taxes, except by the bad system under which they have been imposed ? Were this question to arise in a small community of sensible people, it might not be made the dividing line between political parties, but it would be assigned to or taken up by men of common-sense and sagacity, by whom the system of providing revenue by duties would be adjusted from time to time according to the new conditions developed by invention and science, and not according to the prejudices inherited from other times or according to the supposed behest of partisan requirements. It may well be that after a direction has been given to the work of large numbers of people even by a badly adjusted tariff, the utmost care and judgment are called for in chan- ging it, lest the loss of capital caused by the change should come to more than the benefit. It is not true, on the other hand, that as legislation is now conducted the work is mainly done by those who have little knowledge of the facts and no convictions in regard to economic theo- ries based on adequate investigation of any kind ? What else, then, can happen but a perversion of public trust to purposes of private gain, even by ways of which the legislators themselves have no conception ? Again, taking no cognizance of the general question of protection and free trade, and limiting our considerations to our relations with the neighboring Dominion of Canada, with which we have lately been in danger of a quarrel, what do we find ? It is alleged by those who oppose the free importation of fish, potatoes, and other articles of food, or of timber, ore, and fuel from Canada, that if the exchange of Canadian products for our own is stopped, then the people of the United States will be better off and will have more work to do. It may be admitted that, under these conditions, they will have more work to do. That is not the true question. Would they get more for their work if these articles imported from Canada were not taxed, than they get now that they are taxed ? We cannot buy from Canada for money only, any more than Canada can buy from us for money only ; there 236 The Industrial Progress of the Nation. must be an exchange of products. If we should exchange with Canada the kind of provisions, coal, and goods that we want less, and get from Canada the kind of food, the fuel, the ore, and the timber that we want more, might not the product of each country be increased in the meas- ure of the gain on such exchange ? Would not the wage and profit fund thus become greater than it now is ? The whole country is dis- turbed over the fishery question. What is the measure of that ques- tion ? We now import about $300 worth of salt cod and smoked her- ring, chiefly from Canada, for each 6,000 people in the United States. The whole contest with Canada over the fisheries grows out of the determination of Congress to tax the consumers of fish $60 a year on each $300 worth of fish imported for the use of each community like that taken for an example. The revenue thus derived is not required ; it forms a part of the surplus. The owners of the fishing-smacks of the United States employ two or three Canadians to one Yankee in catching fish, and the consumers of fish are taxed $60 a year on each $300 worth consumed by our people. That tax on fish is the whole cause of the quarrel with Canada on the fishery question. Each reader may compute for himself what would be the harm or what would be the benefit of removing the tax on fish, and also estimate the harm of keeping up a constant cause of irritation with our next neighbor in order to sustain this tax. The average interest of each family of five persons in the United States in salt cod and smoked herring imported from Canada, subject to duty, is twenty cents a year ; on which the revenue under the tariff is four cents, and this revenue is not required. When these facts are considered, does not the recent discussion of the fishery question become a subject of national humiliation ? Whether the treaty was a good one or not did not become apparent because the oppo- sition to ratification was conducted in such a way as to conceal the facts and to deprive the community of the means of forming a true judgment. We next come to the nostrum of " fiat " money. The advocate of fiat money, or of the unlimited coinage of low-priced silver, alleges that if we had more money in circulation wages would be higher, and then each man could buy more, because he would have more money to spend. Does not experience prove that all tampering with the stand- ard of value, which in the form of coin is made use of as an instru- ment of exchange, tends to diminish the production of articles neces- sary for consumption ? Have not all such undertakings ended in restricting credit, and therefore in diminishing the product and in raising prices much higher and much faster than wages have been advanced ? Is not credit one of the prime factors in abundant pro- duction ? Unless a large supply of so-called cheap money should mcrease the product above what fifty cents a day will now buy, so that the How Society Reforms Itself. 237 greater quantity of money would purchase a still greater quantity of produce, might not the only effect be that the rich would become richer while the poor would become poorer, as has ever been the case when the stability of the standard of value has been tampered with by legislation or when the standard of value has been depreciated ? Is not the malignant influence of all depreciation in the value of the currency of a country to be found chiefly in its effect on credit ? Is not credit a prime factor in making prices ? If so, does not credit depend upon the quality rather than upon the quantity of the circu- lating medium ? What constitutes credit ? Does not the farmer who plants a crop, or the manufacturer who buys a stock of crude material, grant a credit to the future when he does so ? Will not all his under- takings be restricted when there is any doubt whether the money received for his product, after all his labor has been expended upon it, will be as good as that which he pays out for his labor at the begin- ning of the season ? Will not product then be diminished ? During the Civil War, when the greenback was depreciating, did not all private credit granted by one man to another finally cease ? Did not prices rise faster than wages ? The Prohibitionist says : " Stop drinking and everybody will be better off." This may be true ; it may perhaps be true that dram- drinking can be stopped by legislation ; but as yet the method does not appear to have been very successful. Let it, however, be admit- ted ; what does it come to ? The expenditure for liquor, in the manu- facture of which a certain part of the grain and other products of agriculture and a certain amount of fuel has been consumed, now averages about four cents per day per head of the population, or about $15 a year per capita. In the typical community of 6,000 peo- ple this would come to $90,000 a year, or seven and one half per cent, of the total product. To that extent a great benefit might ensue if the larger part of the force now expended or wasted in the production of spirits and beer could be employed in some other way. How can it be done ? It would involve the necessity of finding other occupation for the farmers and growers of grain and hops, and for the distillers and brewers, as well as for the dealers who now get their living by providing liquor. To what extent would this change affect the community as a whole ? It is admitted that a large part of the crime and of the public expenditures for prisons and reformatories is due to intemperance ; but, on the other hand, if the statistics were accurately compiled, not only of those whose productive capacity is impaired by the use of liquor, but also of those whose productive capacity is not impaired by such use, or if the statistics were compiled of those who make a temperate or moderate use of liquor as compared to those who are intemperate, the percentage of intemperate persons and the per- 238 The Industrial Progress of the Nation. centage of persons whose ability to work is impaired, would be small. If each reader will consider his own acquaintance, or the members of the community in which he lives, rich and poor, and take note of all who ever drink so much as to impair their productive energy, he will probably be surprised at the very small number and the very small percentage of the whole who will be included in that category. There- fore the question must be asked. To what extent would the disuse of liquor increase the product or improve the distribution of products now measured on the average at fifty cents' worth per head each day, more or less ? Is there not a greater waste in the use of food than there is even in the expenditure for drink ? Admitting to the fullest extent all that may be presented as to the bad effects of liquor, may it not be held that dyspepsia caused by bad cooking is as bad or even a worse evil, whether considered materially or morally, than the mod- erate consumption of liquors which constitutes their average use ? It has been my purpose in reciting these various proposed reforms by legislative methods or by special organizations, to present them in a Avay that will bring each to the test, by applying each "one to the con- ditions of a small community and to the measure of the present average product of this country. It would be useless'even to attempt to state the manifold bearings of any one of these so-called reforms in an article of moderate compass. I have therefore tried to present " the other side " in each case cited, and to put questions in such a way as may raise a doubt as to the efificacy of his special process, in the mind even of the most strenuous advocate of each legislative panacea for the admittedly narrow conditions under which we now exist. In the end, the common-sense of the people will seize upon and hold fast every element of truth that is to be found in each and all of these proposed reforms, and will reject all that is shallow, fallacious, or purely selfish. In that way society grows and reforms itself. X. REMEDIES FOR SOCIAL ILLS.' IN preceding articles I have endeavored to exhibit the relative con- ditions of an average community of 6,000 persons, and to apply to such community the various reforms which have been suggested by different parties in order to bring about an improvement in the general social state. I will not myself attempt to present or to invent any specific method by which the whole condition of society in this country may be changed. Each man may perhaps do a little to remedy existing faults, but he who undertakes to solve all these social questions may perhaps find that communities grow and are not made to order. A rather prosaic suggestion can perhaps properly be submitted. It is a well ascertained fact that, with respect to about ninety per cent, of the community, the price paid for food comes to one half the income or more. After this food is bought, how much of it is wasted in bad cooking ? How much human force is wasted in consequence of bad cooking ? How much does dyspepsia or indigestion, caused by bad cooking, impair the working capacity of the people of the United States and diminish their product ? Perhaps the reader can observe and measure, or at least guess, what is the waste of food and fuel in the 1,200 families of five persons each, more or less, constituting the com- munity of 6,000 persons who live near him. How many cooks are there who know what food to buy and how to cook it ? In any 1,200 average families, more than 1,000 spend one half their income or more for food and fuel ; the less the income the greater the proportion spent for food. Next, let the reader think for himself whether five cents a day per head could be saved in his own family, or in his neighbors' families, or on the average whether the waste of the 1,200 families nearest him amounts to five cents a day per capita. If all the women were good cooks and knew what to buy and how to prepare food in a judicious •and appetizing way, would the saving be five cents a day per head ? If not, how much ? One will probably find that the average expendi- ture for each person, man, woman, and child above ten (two under ten ' Reprinted from the Forum. 239 240 Tkc Industrial Progress of the Nation. counted as one), for food and fuel, is about 25 cents a day. In recent years it may have been a little less, but prices are now rising ; a few years since it was a little more. Can five cents' worth per day be saved ? Is not that a very insufficient measure of the difference be- tween a poor, wasteful cook and a good, economical one ? If five cents a day can be saved on food and fuel, while at the same time that which is bought and cooked may be converted into more nutritious and appe- tizing food, the difference in each community of 6,000 people would be $109,500 a year, or about nine per cent, of the total product of the typical community, which we have assumed to be $1,200,000 a year in gross. When viewed in this light, it may happen that reform in the art of domestic cooking ought to have taken the first place in the list of proposed reforms already given. Can the anarchist, the communist, the socialist, the protectionist, the free-trader, the co-operator, the paper-money man, the knight of labor, the eight-hour man, or the sentimentalist invent or suggest any other method of changing the direction of the industry of the whole community which would on the whole be so effective in improving the conditions of all, as one which would save five cents a day on food and fuel, the money saved to be devoted to providing better houses in which people may live ? If the waste of food and of liquor could be saved and directed or converted into shelter, by providing better dwelling-places for the community, would not the space or number of rooms now occupied on the average by each family be nearly doubled ? Could not the sanitary conditions be made wholesome ? Might not the slums of the great cities be cleaned out and the nuisance forever after abated ? Can this be done by collective or state process or by individual action ? The writer has been held up to much obloquy for an attempt to give this direction to some of the reforms of the present day. Such abuse or objection has usually come from those who get their living by misleading ignorant people as to what their true interest really is ; it is therefore of no consequence. Real life consists in the conversion of force ; that is to say, in the work, whether mental, mechanical, or manual, which is exerted in giving a direction to the natural forces by which life is sustained. Whether or not the averages which have been given correspond identically to the average product and consumption or conversion of force of the whole country, is immaterial. The margin for error is in any event very small ; in all large communities great numbers may be found whose conditions, reported upon by state bureaus, correspond very closely to the figures which have been submitted in this essay on a unit of one typical community numbering 6,000 people. This ideal community really exists somewhere in fact. If you could only find it, what would you do to improve the conditions ? Remedies for Social Ills. 241 Perhaps a yet better example, and one more easily comprehended, may be found by considering the condition of an average family of six persons, a man, his wife, and four children ; the man himself and one child doing the work corresponding to one in three of the present population by whose work subsistence, shelter, and clothing are now gained for all. We will assume that this man is a good mechanic, earning the average pay of such men in the Eastern or Middle States ; the son or daughter works in a factory on fancy weaving at the highest price, and earns about $1.20 a day. The income of the two persons on whom the six depend would be as follows : 300 days' work of the man, at $3.00 a clay $900.00 300 " " one child, at about $1.20 a clay 350.00 Total income $1,250.00 Food for six persons, at 25 cts. each per day, $91.25 per year, in round figures $550.00 Clothing, 7 cts. each per day, $25.55 per year 150.00 Fuel, oil, and household sundries, 3 cts. each person per day, $10.95 per year 65.00 Sundries for personal use, 5 cts. each per day, $18.25 P^r year, 110.00 Rent, 9 cts. each per day, $33.00 per year 200.00 Deposit in savings-bank, each person or fraction over 2 cts. per day, $7.30 per year, say 50.00 Average proportion of all taxes, a little less than 3 cts. per day for each person, $10.00 per year 60.00 Profit upon their work, or contribution to capital at ratio of ten per cent, on gross value of their product, 5 cts. ; 2 cts. having already been set aside for the profit of the workman, there remains 3 cts. per head per day compensation for the use of capital, $10.95 per year 65.00 Total |i,25o.cx) The two persons occupied for gain in this group of six are therefore credited with the average production of $625.00 each per year, or a little over $208.33 P^^* Y^^-^ per capita, which comes to a fraction over 57 cents per day to each person. In what way can this family improve its condition, or in what way can its condition be improved, either by legislation or in any other manner ? The man owns or occupies a house ; the valuation of the land is half that of the house and land ; the rental of the whole is $200 a year. If he owns the house he can put aside what he would other- wise pay for rent, or he can spend it for more comfortable living ; this implies private property or possession of land. If he does not own his house, he must either pay rent for it to a private owner, or, if the single tax on land should be carried out, he must pay proportionately more than the same amount in the form of a tax on the land to the city or 16 242 The Industrial Progress of the Nation. State that he now pays to a private person for rent of land. He is employed by a capitalist ; if he can do better and can earn more by working for himself than for the capitalist, so that he gets no service from the capitalist, he need not pay the profit of $65 assigned as com- pensation to capital, but he can save it or spend it. If he saves that sum himself it is to his benefit. If by working for the capitalist he makes more for himself than the $65 paid by him for the service of capital comes to, then he may gain the difference by working for a capitalist. Capital has no means of compelling him to work in its service, and he has no way open to him to force capital to work for his benefit without contributing to its profit. He only can save a part of his taxes, however collected, by watching the expenditures and voting only for those who will spend the public revenues, national, State, or city, in a proper way for the common benefit of the whole people. The quantity of materials for clothing that each person requires for comfort and welfare does not vary greatly whether the man be rich or poor. The rich man may possess more clothes at one time ; but he does not wear them out so fast ; the workman on the whole wears out more clothes than the rich man ; the difference, however, in the neces- sary supply of clothing is not great, and would not affect the general cost of living to any very great extent. The average expenditure for fuel and oil does not vary in any great measure, and this element of the cost of living is not large ; therefore in this the margin for economy is not great. With respect to food, each average person, rich or poor, absolutely requires the same proportions of nitrogenized substances, starch, and fat, or of the so-called " nutrients." Each adult person requires sub- stantially the same quantity of food, varying a little with the work done ; the man who is engaged at hard labor requires and can digest a greater quantity than the rich man. In quantity rightly consumed, therefore, little economy or saving may be expected or desired ; the saving is to be made by right selection of the materials, and by avoid- ing waste in the preparation and in the consumption of food. In this direction there is a very large margin for saving. The greatest inequalities and the greatest variation in the condi- tions of men are to be found in their dwelling-places ; it is for this rea- son that the land question has become so intimately connected with the labor question. But it is evident that whatever theories may be adopted by the state in granting the conditional possession of land to individ- uals, there must be a certain measure of private occupancy, namely, possession or use of land for a dwelling-place. Compensation must then be made to some authority for the choice or selection of land, either in the form of rent or in the form of taxes upon land values. Re77iedies for Social Ills. 243 The selection or choice and the possession of land having been pro- vided in some way, the occupant must then either be capable of build- ing his own house, or he must pay some one else to build it ; otherwise he must hire a house. He can accomplish neither purpose without cost, and he can accomplish neither without subjecting himself to a charge for the service of capital, unless he accepts charity and is housed in an almshouse. In what way can this typical family improve the condition of its dwelling-place ? If little can be saved on the proportionate expendi- ture either for clothing, for fuel, for light, or for sundries, and if some- thing, however small, ought to be set aside against a rainy day, does it not follow that the only method open to this man and his family at the present time for improving their condition, is by economy in the purchase and right use of food and drink ? Is it not true that better results can be obtained — a more appetizing quality imparted to the food, and more adequate nutrition derived — from twenty cents' worth of food well-cooked, than from twenty-five cents' worth of the same food cooked and served as it commonly is ? In this typical family $200 a year has been assigned either to the payment of rent or to the rental value of the land and dwelling occupied. Five cents a day saved on the food of each member would amount to $109.50 a year, which might be converted into rent or rental value. If a part of the members of the family now spend a sum equal to four cents a day for each member for liquor, the average of the whole country for liquor and tobacco being over four cents per capita, then a saving of one half of this sum would come to |)43.8o, which, added to the saving on food, makes $153.30. By this different direction or expenditure of force, the amount first assigned to providing a dwelling-place could be increased seventy-five per cent. The $200 assigned to providing shelter in some way would te increased to $353.30 per year. Is this a practicable reform ? When the attention of the labor reformer is brought down from glittering generalities and grand schemes for altering the whole consti- tution of society by act of Congress or of the State legislature, to the simple question of how each person, each family, or each community may better itself under existing conditions, great progress will have been made in solving all the problems which are now pending. The professional agitator, who gets his living by misleading the uninformed, may scout at personal economy and ridicule the only available methods by which any true progress can be made in leading the great mass of the people to a higher plane of general comfort and welfare. It does not matter. Whatever may be the temporary influence of quacks, sen- timentalists, professional agitators, and silly novelists, the solid common- sense of the community ultimately controls events, and in a rather slow and indirect way works out for itself its own methods of reform. 244 The Industrial Progress of the Nation. In each presidential election the orators of the two parties have for many years predicted the utter ruin of this country unless their o-.vn side should prevail. But the ruin has never come — quite the reverse. Witness the figures given under the head of " Progress from Poverty " in one of the preceding articles. For a time it seemed possible that a few unscrupulous men, whose power and influence rested upon human slavery, might succeed in their nefarious purpose of re-opening the slave-trade and continuing to subject the whole country to their malig- nant control, but even they utterly failed ; the principle of liberty, which was established by the common ancestors of those who dwell in the South as well as in the North, was too strong for them. None are now so ready to admit that the great result of the war by which slavery destroyed itself, has been the emancipation of the white man through liberty given to the black man. Compared to this destructive force of slavery, by which the product of the whole country was limited and the equitable distribution of products impeded, there is no material cause of danger of any great moment now existing. We have already paid two thirds of the national debt, and by the application of science and invention, especially to the railway service, it has been paid with- out any man being called upon to work harder than he did before the debt existed. The danger point in our system of currency was passed when President Grant vetoed the inflation bill. Whether we will or not, the currency of the United States may soon be sustained by specie, dollar for dollar, through the liquidation of the demand debt, now rep- resented by legal-tender notes, as these notes fall in by way of taxation. The most important question now pending relates to the right method of raising that part of the national revenue w^hich for a long period must be derived from duties on imports. This is one of the minor questions, very important in its place, but probably not of the grave importance customarily attributed to it. The country will prosper, however the taxes may be collected. What the moral effect of a bad method of raising the national debt may be, it is not the present purpose of the writer to treat. When the most important question in a country is how to reduce its taxes to the level of its expenditures, the country cannot be very hard pressed. The continental system of absolute free trade, which exists among the States of our Union over a larger area and among a greater number of people than are now enjoying or were ever permitted to enjoy it elsewhere, renders our foreign commerce relatively unimportant. The real force that governs this country is more powerful than any Congress or system of legislation. That force may be obstructed by bad statutes, or may be made to work more rapidly by wise political methods ; in the end, however, it holds its sway. That force is the solid common- sense and enlightened self-interest of the whole community. Re7ttedies for Social Ills. 245 I have endeavored in various essays to present a true picture of the gain in individual wealth and in the means of common welfare in the few years which have elapsed since the nation proved true to the principle of personal liberty on which it was founded ; I have also endeavored to show that material abundance is well assured to all who choose to meet the conditions which will entitle them to share it. There are other dangers which may not be rightly or fully treated in this essay. Having cast out one devil, there may be a danger that we shall admit seven others by whom our personal liberty may be restricted or taken from us. Legislation, whose true purpose should be only to promote justice and to give equal opportunity to every one, may be perverted so as to bring about an unjust distribution of the means of subsistence, and to deprive great bodies of men and women of equal opportunity to attain their common welfare. On the one side the national Congress may continue its attempt to obstruct our foreign commerce by one set of statutes, and may render the domestic traffic over our railways more costly than it need be by other statutes. State legislators may continue to limit the power of adults in the disposal of their own time — the only element in life that all might enjoy in com- mon except for such restrictions. Yet more subtle restrictions upon individual liberty, affecting all the methods of production and distribution, may continue to be im- posed by secret societies. The man who chooses to maintain his own liberty and to make his own contracts in his own way, may for a time be denounced as a ^'' scab "y but even as the obnoxious title of Yankee applied by the British troops, has been assumed by the people of New England as one to be proud of, so the workman who maintains his own personal liberty may presently assume the title of scab as a true testi- monial to his right position and true evidence of the method by which he has attained the advantage of position without harm, but to the benefit of his fellow-workmen. The effect of these various restrictions upon personal liberty may be to prevent the abundance of the means of subsistence becoming as ample as it might be, and may continue to take from the many a part of the fruits of their labor for the benefit of the few. Yet this country has been endowed with such abundant resources that we shall continue to thrive in spite of the blunders of legislators and the interference of labor associations, whose objects may be as right as their methods of attaining them are wrong. On the other hand, there has never been a period in the history of any country when so much attention has been given to the study of the forces which make for abundance and welfare. Before many years it may become apparent to all that the only way to raise the general standard of living and to benefit the community as a whole, is to de- velop the personal character and capacity of each and every member of 246 The Industrial Progress of the Nation. it. The primary source of all wealth is in the manual and mechanical work done by the many under the mental direction of the few by whom all are served. The stream cannot rise higher than its source, and if the many remain ignorant and incapable of taking advantage of the opportunities which science and invention have placed at their com- mand for developing the products of our mother-earth in ever- increasing measure, then even a low standard of subsistence may with difficulty be attained, and the hardships to which many may still be subjected will continue to be imposed upon them by their own inca- pacity. The mind of man is the potent factor in material production ; character counts for more than capital in getting a living. He lives best, even in a material sense, and he earns the most leisure for him- self, who, by the use either of his brain or his capital, while serving himself at the same time raises the earnings of the workman to the highest point by reducing the cost of production to the lowest. The dollars of the gain which the capitalist earns under these conditions are but a tithe upon the service which he has rendered to all. The open secret which few yet seem to comprehend, although all act consistently with it unless restricted by statute or by trade by-law, is that not only the individual wealth but the common welfare of men and of nations, are attained in most ample measure through inter- dependence and not through independence. THEORY AND PRACTICE. SUPPLEMENT TO NO. lO OF THE " FORUM " SERIES. HAVING been led through devious ways to the conclusion that the greatest gain which can now be secured to society as a whole, is not by legislation, not even by remission of taxes, not even by saving a considerable part of the absurd waste by fire, but by teaching society as a whole how to prepare food in the process of cooking after the food has been provided, it would seem as if this series of articles would be incomplete without a treatise in which the practical application of the theories presented may be made and a remedy suggested. One of the greatest embarrassments even to one who may have been called in early years to practise close economy in the art of living, but who is no longer under any absolute necessity to do so, is to meet the rejoinders of working men to whom he attempts to give any informa- tion, somewhat in the following form : " If^e cannot look forward to any great change in our condition ; we have been too long devoted to one kind of work in one department to see much chance for progress ; we do not want to be lifted out of our present sphere and separated from our fellow workmen, and we could not be if we would, it is too late ; we must stay where we are ; and we are in some danger even of having our own special work invented out of exist- tence by some new machine or other ; we can barely make both ends meet at the end of the year as things now are ; it is all very well for you to talk about economy, you have two or three big rooms for each member of your family ; we have only one little room for every two or three members of our families, and we are so crowded now that we jostle each other ; yet we must go on in the old way, and we must stand by each other in our own trade and try to get all we can. All you tell us may do very well for one who can wait, and who can choose what his work shall be. We can neither wait nor choose ; here we are, and here we must stay whether we want to or not. If you think any one can live on ten cents* worth of food a day, try it yourself if you want to. We don't want to, we don't mean to, and we can't afford to. We have n't much time, and we must buy food that can be cooked quickly." Underneath this very honest statement of the difficulties of life there is also often an undercurrent which crops out, somewhat in this form : " We work for all that you get as well as for what we get ourselves, why should n't we have as good food as you do ? " 247 248 The Industrial Pi'ogress of the Nation, If the capitalist did not add more than he takes away from the common stock, there would be more force in these objections ; the great difhculty is in bringing about a right understanding among the different classes of society ; as I have said in one of the previous essays, the one thing most needful is for the rich man to learn how the poor man lives, and for the poor man to learn how the rich man works. There is but one reply to this sort of rejoinder of the workmen. All that can be said to them is this : " If you do not learn how to get the most comfort out of what you now earn, there will certainly be very little chance that you will ever learn how to earn any more. The only way to a condition in life in which you may be able to spend twice as much as is necessary for food for every day, is to learn how to get as much as you can out of the money that you can now afford to spend. If you want to be able to spend fifty cents a day, the way to it is to learn how to live on ten cents' worth of food a day. If you are crowded together because you cannot afford to own or to hire a good house, and yet spend twice as much for food as you need to, would n't it be better to save one half the cost of food if you can, and yet get as much comfort out of what you do spend as you now do, and then spend twice as much for a dwelling-house." The average rent of the workman is seldom more than one third to one half the cost of the materials for food. If the workman can save one third to one half the cost of the materials for food and yet be bet- ter nourished, he can then improve his dwelling-place in just that measure. A man who knows just how to do it, and who chooses to give the time which is necessary to the food question, can without a doubt maintain himself in vigorous health and strength on ten cents' worth of food a day ; but there are probably very few persons who can afford to do so ; it may cost more in time and trouble to live on ten cents a day than it does to spend twenty cents ; most people had rather spend more than ten cents a day if they have it to spend, and get more variety of food for their money ; but the great misfortune is that most working people spend twenty or thirty cents a day for their food and do not get over ten cents' worth of satisfaction or nourishment out of it because they put good materials to a very poor use. In order to enable those who choose to save a part of the waste of food, the Avriter has attempted to put his own theories into practice, and in the following article, which is reprinted from the June number of Lend a Hand, he has attempted to tell how to do it. There is one satisfaction in the invention of the ovens referred to in this article ; if their use may not improve the condition of the poor, it may at least greatly ameliorate the condition of the rich. If the ovens which are described are used under the direction of a person of moderate intelligence, it is almost impossible even for a poor cook to spoil good food ; again those who do not wish to have a hot kitchen, especially in summer, may cook their own dinners in a cool dining-room without altering the temperature by more than one degree. Theory and Practice. 249 The information is offered for whatever it may be worth ; and this chapter forms a fit conchision to a series of articles in which the ruling idea has been that every man makes his own rate of wages by the amount of intelligence that he puts into the work that he is called upon to do. This rule works both in the earning and in the spending of the ' See page 339, " The Missing Science." i I. WHAT SHALL BE TAXED ? WHAT SHALL BE EXEMPT ? WHAT SHALL BE TAXED? WHAT SHALL RE EXEMPT? WHILE revising the foregoing series of articles, which were first printed in The Forum, for republication in book form, I have been reminded that my treatment of the subject of protection and free trade has been subjected to adverse criticism by the advocates of both lines of policy. That might be held to prove that I had at least succeeded in part in what I had undertaken to do through the medium of the magazines, viz., to incite an intelligent dis- cussion of the tariff and other economic questions, in place of the com- mon vituperative method which is so customary among those who may have no intelligent basis for what they call their opinions, and who are therefore accustomed to cover their real want of any knowledge of the subject by imputing ignorance or bad motives to their opponents on either side of the question. There is now no difference of opinion among the intelligent advo- cates of protection and the reasonable advocates of freer trade at pres- ent leading up to actual free trade in the future, as to the final pur- pose to which all legislation ought now to be directed. That objective point is the establishment of a system of commerce with other nations which shall ultimately be as free from taxation under the form of a tariff of duties on imports, as the necessity of the nation for a revenue from such duties will permit ; such point to be attained as soon as the conditions precedent can be established which will admit such objective point being reached. Both sides, therefore, seek the same end, differing only as to time and method, with the exception of a few persons who advocate na- tional isolation by means of " a tariff for protection with incidental revenue." They are, however, so few in number, and of such feeble influence intellectually, that they need not be considered by those who treat the subject seriously and who are free from mere partisan bias. The main difference between the advocates of protection and free trade at the present date is upon the question of time and method in reducing the present tariff, and in regard to the subjects from which the present excess of taxation shall be first removed. The difference 253 2 54 1^^^ Industrial Progress of the Natiojt. is therefore one of detail, both seeking to promote domestic industry in the most effective manner known to them. Cannot an agreement be reached under such conditions ? The basis of the protective theory among those who intelligently and reasonably sustain it is this : I St. It has been held by them that a nation should develop within its own limits the power or ability to supply itself with the necessaries of life without recourse to imports from other countries. This view has been very urgently sustained in respect to articles which are necessary not only in time of peace, but which are even more urgently required in time of war ; the absolute requirements of war be- ing food, clothing, and arms, /. e., fabrics made of wool, iron, and steel. 2d. It has been or is held, that even aside from the necessities of war, a nation should render itself independent of all others, and should become capable of supplying itself with all the necessaries of life, if the crude materials for such supply exist within the limits of its territory and can be worked, either in the soil, the mine, or the forest. 3d. It is held that in developing the processes for converting these crude materials into their final forms ready for consumption, a great diversity of occupation may be promoted ; and that w^hile free trade may be the true objective point, it cannot be adopted safely until such conditions precedent have been established as may enable the domestic manufacturers or converters of crude materials into finished goods to compete with foreign countries on even terms. 4th. Lastly, it is now held by the advocates of protection, that in consequence of the higher rates of wages which prevail in this country as compared to foreign countries in certain specific arts, we cannot yet compete with foreign countries in these arts, if the free-trade policy should now be adopted. In support of this proposition, it is held that the rates of wages are a true standard by which the cost of goods may be compared. In addition to these principal reasons for placing duties on foreign imports at higher rates than those Avhich would yield the largest reve- nue at the lowest rates on selected subjects of taxation which are not of necessary use in domestic industry, it has been held that by means of such duties or under the protective system, so-called, additional work may be provided for the people of a given nation, through the di- versity of occupations supposed to be greatly promoted by this system. In conclusion of the whole matter, it has been and is held, that al- though the first effect of placing protective duties on foreign imports must be to keep the prices both of the domestic product and of the foreign import of like kind, higher than they would be except for such duties, yet the ultimate effect of the system must be to reduce such prices and to furnish a greater abundance to consumers at less cost. What Shall be Taxed? What Shall be Exempt? 255 This is the principal justification of the system in the minds of those who sustain it, to wit, that at the cost of a temporary higher price, lower prices will be finally attained. Such is, I think, a fair statement of the argument for what is called protection to domestic industry by way of the imposition of taxes on foreign imports, commonly called duties. It is also held by a few persons, even some holding quite conspicu- ous positions, that by way of duties on imports foreign nations may be made to pay revenue to this country. Such an argument hardly calls for serious consideration, as it could never be put forward by any one conversant with commerce. It is based on the admitted fact that, if the duties imposed should so obstruct our demand upon a foreign country for a given article, this obstruction, in place of raising the price at home, may depress the price abroad, and this depression of price is said to be the same as putting our tax upon other people ! In point of fact this lowering of foreign prices is one of the most injurious effects of a mistaken policy, especially when it affects the crude or partly man- ufactured articles which are used in the mechanical and manufacturing arts, as it gives the foreign manufacturer an advantage over our own which cannot be overcome. See the subsequent figures on iron and steel. One may not hastily and dogmatically pronounce all these proposi- tions to be without any foundation ; and it is both useless and mis- chievous to denounce those who present such views as being mere spoliators, or to say that they are striving as a body to support themselves and those whom they employ at the cost of their neighbors, without rendering any true service in return. These views have been, and are now, held in perfect sincerity and integrity by many of the most upright citizens in this country ; they are still believed to be sound by a very large number of intelligent men, who sustain them without any other purpose than because they fully believe that the welfare of the nation depends upon their being sustained. Unquestionably there are among the supporters of protection many persons whose own interests are to themselves so paramount in the matter — or are believed by them to be so paramount in their relation to others, — as to obscure all consideration of the public welfare ; as there are also, on the other side, advocates of free trade who would break down all barriers to immediate free exchange without any refer- ence to the long period during which protective duties have been maintained, and without any consideration of the great harm that may arise from bad methods of abating what may even be an existing evil. With such intolerant and illogical persons, who give little or no consideration to existing conditions, no discussion is possible. The writer was bred in the firm conviction that, for the reasons given, the protective system was founded on principle and on facts. 256 The IndiLstriaL Progress of the Nation. and that protection was necessary to the welfare of the country. It has only been by close observation of the facts of life that he gradually became convinced that these arguments for the so-called system of protection were not founded on any principle and cannot be justified at the present time even on the ground of expediency. The arguments should be met, however by a fair and full consideration of the facts and the influences which led to the adoption of the policy in the past, and of the conditions as they exist at present, changed as they have been in some measure by past acts. It may be admitted that by force of the highly protective system as it now exists in this country, and as it has been in force practically since the years 1861 and 1863, certain arts have been more fully developed, certain products have been increased, and certain prices may have been reduced both here and in other countries through the effect and in consequence of this system. It may even be admitted that in respect to certain very important commodities — notably iron and steel, — the actual prices have been reduced both here and in other countries more rapidly, and possibly to a lower point, than they would have been, except the protective system had been in force in this country. It must be admitted that as a consequence of the high duties upon wool, the price of domestic wool has been reduced by force of protection to a lower point than it would have attained except under this system ; and that wool growers have been misled in their expecta- tion even of temporary benefit to themselves. There may be other articles which have been affected in the same way. All that can be said in rejoinder to this possible admission of the claims made on behalf of protection is, that any reduction of prices which has been, or may be brought about in this way is not worth what it costs ; and that during the longer or shorter period given to the operation of this method of securing a reduction in the actual price of an important material, such a disparity or difference in price has been maintained throughout this period of high protection in the cost of the crude materials— such as wool, iron, steel, and chemicals, — which are most necessary in the processes of our domestic industry, as compared to the cost of these same materials to the consumers of other countries, as to have made the cost of the protective system much greater than the benefit, if any benefit there has been to any one. In other words, whatever may be the advantage or the disadvantage of a reduction in price, if it has been brought about by or through the interference of legislation, the disadvantage of being subjected to higher prices in this country as compared to prices elsewhere through a long period, on the most important crude materials which are abso- lutely necessary in all branches of domestic industry, has been and is much greater than any possible benefit arising from lower absolute prices of such materials at a later period. IV/iat Shall be Taxed? What Shall be Exempt f 257 Tn the competition of nations, it is the relative price that tells and gives supremacy at a given time, whatever the actual price may be. For instance, iron and steel are the most necessary metals ; they lie at the foundation of all production and distribution ; their consumption is the most adequate standard by which to measure the progress of any nation ; but their production is one of the most undesirable occupa- tions, which fortunately requires but a small fraction of the population to be devoted to it. In 1880 less than one hundred thousand men and boys produced about four million tons of pig-iron in the United States. At the present time, such have been the improvements in the method and the reduction in the necessary work, that it may be computed that not over one hundred and fifty thousand to one hundred and seventy- five thousand, out of twenty to twenty-one million persons now occupied for gain, are required to serve our present population with over seven million tons of iron. Reference has already been made in a foot-note to one of the pre- ceding articles, to the fact that while we have consumed during the last ten years very nearly thirty per cent, of the entire product of the iron and steel of the world, and during the last two years nearly forty per cent., yet although the actual prices of these metals have during this very period been greatly reduced, our consumers have paid fifty-six million dollars a year on the average more than their competitors, or five hundred and sixty million dollars in all in ten years (1878-1887), for iron and steel, according to compilations which are given by Mr. David A. Wells in his forthcoming work. Such has been the cost of protection. For the last two or three years we have paid more than seventy million dollars a year over and above the price paid for these crude materials by consumers in Great Britain in this single branch of industry. Hence it follows that if it should be claimed and allowed that this is the right way to establish and main- tain the production of crude iron and steel in this country, it must also be admitted that it has been accomplished at a cost measured by this disparity in price, of five hundred and sixty million dollars in ten years — which is more than all the capital now invested in all the iron- mines, blast-furnaces, steel-works, and rolling-mills combined which are now in existence in this country. Had it not been for this dis- parity in price working constantly to the disadvantage of this country, no matter what the actual price of iron and steel may have been in any one year, can it be doubted that our consumption of iron and steel in the manufacture of ships, rails, machinery, locomotives, and tools and wares of every description would have been vastly greater than it has been ? Is it not true that we have failed to retain even the control of our own markets in respect to manufactures and machinery made 17 258 The Industrial Progress of the Nation. of iron and steel, while we have been almost wholly forbidden any share in the supply of other countries ? Have we not protected the consumers of iron and steel, — or the manufacturers who use crude iron and steel in other countries, — to the disadvantage of our own, and must not this disparity in price be charged to the cost of develop- ing our domestic iron-mines, works, and rolling-mills by way of special taxes on imports imposed for the purpose of protecting them ? If there has been something added to the occupation of the people underground and in these furnaces and rolling-mills, has there not been even more taken away from the occupations of the people upon the farm, in the factories, the workshops, and the ship-yards of the country, whose products might have been exchanged for these crude materials ? Lest these figures should be questioned, I will give the proofs and cite the authority. See special treatment of this subject subsequently given. Have we not protected the woolen manufacturers of other coun- tries rather than our own, by forcing the huge supply of wools from Australia, from South America, and from other parts of the world upon them in exchange for their fabrics, thus lowering prices to them by withholding our own free competition, while depriving our own consumers of these varieties of wool without which our manufacturers of woolen and worsted fabrics cannot thrive ? Have not these duties on crude materials prevented us from holding even the home market in this country for our manufactured goods, although the people con- sume more fabrics made of iron, wool, and cotton than the people of any other country ? At this very moment (May, 1889) it is alleged that through the consolidation of several steel-works in the West the making of tin plate may be taken up ; and a desperate effort has been made to double the tax of about six million dollars that the people of this country now pay on tin plate imported, in order to sustain domestic industry in making these plates. Hardly an article could be named upon which a tax could be placed with more injurious effect than upon tin plates. They are articles of common necessity in the dairy, in the work of canning meats, fish, vegetables, and fruits, and they enter into all the domestic arts of life. To the extent to which they may be taxed the farmers of this country are placed at a disadvantage in saving their crops or products by canning them. In answer to the question, " What are the most notable consequences that would follow the establishment of this industry in America ? " the answer has lately been given by the promoters of this enterprise, that if this industry were established here, " we should keep among our own inhabitants from twenty to twenty-five million dollars a year, a constantly increas- ing amount, which we now send abroad the moment we can supply What Shall be Taxed f What Shall be Exempt / 259 our own demand." This statement is one of the glittering generalities which may deceive even the elect ; it is alleged that we should keep among our own inhabitants a certain number of dollars ; but this is not the fact ; we do not buy our tin plates with dollars made of either gold or silver ; and if we did, it would be because we can produce more gold and silver dollars than we need for our exchanges. We buy our tin plates with the pounds sterling which are placed at the credit of the exporters of our corn, wheat, flour, cheese, cotton, oil, and other products which we cannot consume at home and which are exported. We pay for tin plates with the excess of our food, fibres, and oils. These products go to supply the people of other countries with the necessary articles of food and fibres which we produce at high wages and yet at lower cost than any other country. If we cut off the imports of twenty-five million dollars' worth of tin ])lates we also cut off the export of twenty-five million dollars' worth of wheat, corn, cotton, cheese, and other farm products. If the production of tin plate would give employment to as large a number of consumers within our own limits as now buy this excess of our product which is exported, our farmers might not feel the difference. But would such be the fact ? The production of tin plate is very largely a matter of capital, and in moderate extent and in small numbers a matter of rather low-grade labor, while that labor is of such a kind that there are none capable and few willing to do the kind of work which is necessary to be done in order to produce tin plates here. The production of tin plates here would imply the application of a large amount of capital, and the importation of a moderate number of laborers skilled in the art, who must yet be a somewhat low-priced quality of work- men, as no part of the work is a very desirable one to follow. Hence it might follow that the farmers who now supply food and fibres in exchange for foreign tin plates would lose a part of their large market abroad, and would fail to gain in the domestic consump- tion of their produce in any equal measure. Should we then save twenty to twenty-five million dollars now said to be sent abroad for tin plates, or should we not lose at least one half that sum in our restricted market for our surplus crops while paying additional taxes, — if the present tax on tin plates were doubled in order to promote their production in this country ? Would not our farmers not only lose a great market while gaining a little one, but would they not also be yet more heavily taxed on all that they now produce by the heavier co.st of utensils in the household, the dairy, the canning factory, and wherever tin is consumed ? It was not, however, wholly by considerations of this kind that the writer was led to change his views upon the subject of protection, and to become an advocate of ultimate free trade, i. b 6bb 6c. Consumed by Wage- earners in the Process of Con- version into Capital. FINAL STAGE. 6. Proportion of all products con- verted into capital as measured in the preceding sections. Production, Distributio7i, Consumplion. 297 Section No. 5, is consumed by the richer classes who receive it : they are relatively few in number, and if they consume or waste according to their own pleasure, as much as five hundred million dollars a year, or five per cent, of the total computed product, yet their absolute con- sumption is represented by the small section numbered 5. Another part of what the richer classes receive is carried forward for consump- tion by conversion into capital, Section No. 6bb ; but the greater part of their incomes, designated Section 4a, is spent on what might be considered a reasonable standard of living : — in the construction of good houses, for the higher education of their children, in provision for music and art, in country-places and the like ; a class of expenditures to which no exception can be taken, unless it could be proved that this specific class did not add to the aggregate product of the whole people, far more than they receive in the form of income or spend upon the luxuries or upo?i the cot?iforts of life. In the Third Stage, Section No. 4, that part of the income of the richer classes, spent by them on houses, gardens, musical instruments, carriages, etc., is designated ; it is consumed by the working classes, to whom it is paid out, and it provides them with the means of living. In the Fourth Stage, that part of the annual product which had been previously brought forward under Section No. 6b, as the savings of the working classes engaged in direct production, Section 6bb that part added to capital by the richer classes and Section 6c, that part saved by those who work in the service of the richer classes, is represented in the process of consumption by the working people who construct the railroads, build the mills, or in other ways convert that part of the an- nual product which can be added to the capital of the country into its durable form. In the Final Stage, Section 6, the portion designated separately in preceding sections computed at ten per cent, is pictured as being con- sumed by conversion into capital of a more or less permanent kind, and in the process of conversion is spent among working people. Now any one who can make a closer estimate of the value of the annual product itself may do so ; or any one who can make a closer but different estimate of the way in which the product is divided, may alter the size or the proportion of the several sections of these dia- grams ; but in so doing they may only alter the actual division of a certain annual product without altering the rule under which it is now divided, whatever that product may amount to. The working people who do the actual primary work of producing the necessaries, comforts, and luxuries of life designated in Sections ^a and 3, whatever proportion of the product they control or consume, and whatever section of the square they occupy, either in appearance or in fact, now produce more than food enough, — more than fuel 298 The Industrial Progress of the Nation. enough, — more than fibre enough, — more than clothing enough, — and more than timber and metal enough, — to feed, clothe, and house the whole existing population in greater comfort than the whole population now enjoys on the average. This section of the population, whatever its relative number or proportion may be, produces even such an excess oi the necessaries of life, that with the excess we buy the comforts of life from other nations ; such as tea, coffee, sugar, and spice, more than enough for abundant consumption by the whole population. Yet want exists in the midst of abundance. A few obtain control of more than enough and waste a part ; a greater number secure a competence ; but the many secure less than enough to enable them to enjoy much leisure ; while a few again actually suffer from want or are upon the edge of want all the time. The problem of society is to change these conditions by evolution rather than by revolution ; since even the waste of the few or of the many cannot be saved or spent in a different direction without bringing about temporary want in the process. For instance, there is scarcely a doubt that the small aggregate expenditure of the rich for fine wines and fine tobacco, which constitutes but a small part of the aggregate expenditure upon this class of luxuries, coupled with the very great aggregate expenditure of those who constitute the working classes, for beer, whiskey, and tobacco, amounts to about one thousand million dollars a year in all ; that is to say, in the aggregate, beer, whiskey, wine, and tobacco come to ten per cent, of the entire production and of the consumption of the people of the United States ; possibly a little less, but according to some estimates even more. Let it be supposed or admitted that the world would be better off if everybody would give up the use of liquor and tobacco, and did so. It would of necessity follow that about ten per cent, of the people of the United States would be deprived of their present mode of getting a living, and that number would be more than six million, of whom two million are at work. This but indicates the stupendous difficulty of changing the present methods of society and the yet greater difficulty in altering them by legislation. After all that may be said and done, there may, however, be those who will question the right of persons who fall within the category of the richer classes to their present share of the annual product, what- ever it may be, and who may claim that this share would fall, under a more just method of distribution, in a great measure to those who sort themselves as the " working classes." In answer to this claim, while admitting that there is room for many reforms, — admitting also that there are many defects in existing laws affecting distribution which should be amended, — yet the capitalist class can be fully justified in attaining and controlling the expenditure Production, DisU'ibution, Consumption. 299 of its share of the annual product, whatever it may be, because they add ?nuc/i more than tJieir own incomes to the total product. The mind of man is the i)rime factor in all material production, — without it the mere labor of the hand would be incapable of providing for an increasing population. Setting aside all distinction of classes and reasoning only on the qualities of mind which are necessary to the accumulation of capital, it becomes apparent ist. That the saving of capital at the beginning, however little it may be, is due to prudence, self-denial, economy, and sagacity. 2d. The productive use of capital, after it has been saved, calls for intelligence, skill, and mental capacity. 3d. The larger the capital the greater the mental capacity required for its application to productive purposes. 4th. Unless capital is directed to productive purposes, whether in- vested in land, mills, railroads, or works of any kind, it yields neither rent, interest, profit, or earnings. When productive it increases pro- duction more than it secures as income. 5th. Unless labor did in fact secure a better subsistence in the service of capital, the workmen would refuse to work for the capitalists. It follows of necessity that whatever share of the annual product may be secured by the capitalist class under just laws which create neither privilege nor preference, the annual product itself in which all share, both laborers and capitalists, is increased in vastly greater measure by them than that part of the product or share which falls to capital comes to. A rule has been propounded on this matter by Henry C. Carey, the advocate of the highest protection, and also by Frederic Bastiat, the most radical advocate of free trade, which is sustained by many other writers, and which is also fully proved by the observation of the facts of life, to wit : " in proportio7i to tlie increase of capital., the absolute sJiare falling to the capitalist is aug77iented while the relative share is diminished.''' On the other hand, the share falling to labor is increased both absolutely a?id relatively. There is one method of analysis which may perhaps be accepted as conclusive, upon the question of the proportion or percentage of the annual product which may be saved and added to the capital of the country. The population of the United States in 1780 was not far from four million ; in 1880 it was substantially fifty million ; the average for the century was therefore twenty-six million. Now twenty-six million people inhabiting a country for one hundred years is equivalent to twenty-six hundred million inhabiting a country for one year. If we then assume that twenty-six hundred million people had lived and 300 The Indtistrial Progress of the Nation. worked one year under the same average conditions as the twenty-six hundred million had lived and worked during the century, and that in the one year the average saving or addition to the capital of the country had been ten dollars' worth each, then the sum of the capital thus saved would come to twenty-six thousand million dollars. While it may be true that not much dependence can be placed upon the valuation of the capital of the country as given in the Census of i8So, yet this much is known to those who, like the writer, took part in the compilation of the Census of 1880, that the capital is overestimated rather than underestimated in its valuation. Now deducting the valuation of land and of public buildings from the computation made by the Census Department on the basis of all the returns, and that part of the property of the people of the United States which, in 1880, could in any sense have been called private capital, did not exceed this sum of twenty-six hundred million dollars. Now then, ten dollars a year is ten per cent, of one hundred dollars, and if ten dollars' worth of product saved had been added to capital, the remainder must have been ninety dollars' worth consumed each year per capita. Ninety dollars' worth divided by three hundred and sixty-five days in a year gives a little less than twenty-five cents' worth a day of products, as the average consumption of each person, man, woman, or child, who had inhabited the United States during the cen- tury. Could the population of the century have subsisted on less ? If however the average product for the whole period has been worth more than one hundred dollars per capita, then all the capital we have now to show for our savings of a century comes to less than ten per cent, of the total product of the century. Each one must judge for himself how near that sum, twenty-five cents, is to what must have been the measure of daily consumption. If the consumption was greater than this, then the proportion saved and added to capital is so much less. If the people had been sup- ported during the century at less than twenty-five cents' worth, includ- ing rent or shelter, food, fuel, clothing, and other supplies, then the proportion saved may have been greater. On the whole, ten per cent, would appear to be as close an estimate as it is in the power of any statistician who is capable of reasoning upon the figures, to set aside as the amount saved in each year. In 1880 the whole amount of property which was assessed for local taxes in the United States was as follows : Real Estate $13,036,766,925 Personal Property 3,866,226,618 Total $16,902,993,543 Production^ Distribution, Consumption. 301 It will be observed that the assessors' valuation on real estate in- cludes all buildings and improvements upon land of every name and nature. So far as there is any information to serve as a guide, the assessment may be about evenly divided. Assessment on land one half $6,518,383,462 Assessment on buildings or other improvements 6,518,383,463 Suppose it be admitted that the land only was valued at seven thou- sand million dollars, for the assessment of taxes. The sum of all taxes in 1880 was over seven hundred million dol- lars, for national, State, and municipal purposes. Mr. Henry George and his coadjutors propose to put a single tax upon land in order to meet all these expenses. In 1880 the rate would have been ten per cent, on the assessed value. This subject is only referred to incidentally, it has been treated else- where by the writer. If the '* site value ," so-called, of all land should be taxed ten per cent., the question may well be asked how any one but a capitalist could afford to build upon or to cultivate it. This assessment, was, however, much below the true value. An estimate of the true value of the property of the United States was made by Mr. Henry Gannett, one of the most conscientious and capable of the experts, who was employed in compiling the Census of 1880. He gives the following data : True value of farms $10, 197,000,000 Residence and business real estate, including water power 9,881,000,000 Mines, oil wells, and quarries, including half of the annual product of the same assumed to be in the hands of the producers 781,000,000 Railroads and equipments 5,536,000,000 Telegraphs, shipping, and canals 419,000,000 Household furniture, books, clothing, jewelry, and supplies of food, fuel, etc., in the hands of consumers 5,000,000,000 Live stock on or off farms, farming tools and machinery 2,406,000,000 Three quarters of the annual product of agriculture and of manufac- tures, including imported goods 6,160,000,000 Miscellaneous, including mechanics' tools 650,000,000 Specie 612,000,000 Churches, schools, asylums, public buildings, and other real estate exempt from taxes '. 2,000,000,000 Total $43,642,000,000 When we come to analyze these figures for the purpose of separat- ing the value of land from the buildings or improvements which have been put or made upon the land ; and also for the purpose of separat- ing that part of the wealth of the country which had become common wealth, in order to ascertain what the remainder is, — such remainder being the capital which has been saved throughout the period of our 302 The Industrial Progress of the Nation. existence as a nation, — the matter is subject to some uncertainty and we must reason by analogy from known facts. In the city of Boston, where the valuation for the purpose of assessing taxes is very high, the valuation of land comes to three fifths, and of the improvements of buildings constructed upon the land, to two fifths of the assessment on real estate. In the country districts these proportions are apt to be about reversed. On this basis from Mr. Gannett's estimates we may set aside one half the valuation of farms, one half the valuation of the residence or business real estate and water power, and two thirds of the value of the mines, oil wells, and quarries, including the product on hand, as being so much capital or wealth saved from previous work, — this leaves the valuation of land taken by itself including mines, oil wells, and quarries, at ten thousand million dollars. We may then readily com- pute the capital. Valuation of the capital invested upon the land $10,869,000,000 Railroads and their equipments 5,536,000,000 Telegraphs, shipping, and canals 419,000,000 Live stock, farm tools, and machinery 2,406,000,000 Three quarters of the annual product of agriculture and manufactures (rather a large estimate in the judgment of the writer) 6,160,000,000 Specie 612,000,000 Miscellaneous, including mechanics' tools 650,000,000 $26,652,000,000 We then have what may be called the true capital of the country, which is all made use of, with the exception of dwelling-houses, for re- productive or for distributive purposes. The remainder, the estimate of property consists of household furniture, books, clothing, and sup- plies of food which are in the way of immediate consumption, five thousand million. Even if we add this item to the capital previously set apart, the total comes to only thirty-one thousand six hundred and fifty-two millions, — then deduct the dwelling-houses and household furniture, books and clothing, and the actual productive or reproduc- tive capital of the country in 1880 exceeded but little twenty-six thou- sand millions ; or substantially the sum of ten per cent, on an annual product of only one hundred dollars' worth per capita for a century. Of course the product has of late been much greater, and the addition to capital at ten per cent, has of late been very large, — much larger in the aggregate than ever before. If, then, we put the minimum sum against each person of the popu- lation on which the people could by any possibility have been fed, clothed, and sheltered, we reach figures which, by comparison with the largest estimates of the taxable yjroperty of the country, exclusive of Produclio7i, Distribution, Consumption. 30 land, tend to prove the utter impossibility of any accumulation of capital having been made in excess of two or three years' product. For instance, at my own estimate of two hundred dollars per capita, which, in my own judgment, is too large rather than too small, the amount available for each man, woman, and child of the population in 1880, a year of more than normal prosperity, did not exceed what fifty-five cents a day would buy at the prices at which goods were then sold to consumers ; therefore this sum per capita must have covered the consumption of the farm, taxation and the compensation for all services of all kinds, whether rendered under the title of rent, interest, profits, earnings, salaries, or wages. Now it is very plain that the mass of commodities of necessary use which have been produced has been greater for the last twenty-five years than at any previous period. The figures indicate double the quantity as compared to the first half of the century under considera- tion. The prices for the last five or six years of the necessaries of life have been substantially what they were in 1850, before the effect of the gold discoveries in California had begun. Ten per cent, of this in- creased product makes a very great and rapid addition to capital. If the whole production of the population which has dwelt in the United States from 1780 to 1880 has been only one hundred dollars' worth per capita in all, as estimated in the previous computation, then the amount of product available to each person during that whole period must have been less than what twenty-seven cents a day would buy. If the product has been one hundred and fifty dollars' worth per capita each year, consumption has been what forty-one cents a day would buy. According to my computation for 1880 the total product was what fifty-five cents a day would buy, and in view of the continued increase of product since 1880 and the lessening cost of distribution, it may to- day be about what sixty cents a day would buy. Since 1880 the taxes have probably diminished in ratio to product from seven per cent, to six per cent. Interest, rents, and profits have also steadily diminished in ratio to products until capital can secure for its services, when lent for industrial purposes, less even than in Great Britain ; although the current rates for call money in London, — the banking centre of the world, — may be a little less than in New York. Again, any one who is at all conversant with the conduct of busi- ness may readily bear testimony to the fact, as soon as his attention is called to it, that there is probably seldom or never one year's stock of food held in advance of consumption, even in this country. There is never one year's stock of materials for clothing on hand, seldom a stock more than enough for the ensuing season, held in advance of consump- 304 The Industrial Progress of the Nation. tion. The amount of capital, great as it must be, which can be applied to housing the increase of population, barely suffices to keep them under cover. Even houses wear out about as fast as they are built. The warehouse, the machine shop, and the factory are a little more durable, but the life of the best machinery is very short ; it is used up or displaced by new inventions in from ten to twenty years. If a rail- road were neglected for a single year there would be little left but the road-bed ; and that would be gullied in the course of every stream. There is therefore nothing useful that is very old. " Want treads on the heels of plenty," with only one, two, or three years to spare in the work of converting the forces of nature to the subsistence of man. With respect to land, which is said to be limited and which differs in some respects from capital in that whatever the quantity may be it cannot be increased in area ; it may be admitted that the area cannot be increased but the product of land can be increased almost indefi- nitely when the mental factor, which is the prime factor in production, is applied to its use. No one yet knows or can measure the productive capacity of a single acre of land anywhere. The possession of land under existing laws by individuals is more free to-day from restriction, and it is more easy for any man who desires land to possess it than it was when the pilgrims landed on Plymouth Rock, or when the first settlers in Florida occupied the country, before a single private title had been obtained from the aborigines either by conveyance or by conquest. The same amount and quality of work which was then required to reach, open, clear, and put land under cultivation, such land being free from any private title and open to settlement without money charge, if now directed to earning wages in any art which develops the intelli- gence and capacity of the man who does the work, will enable him to save enough for the purchase of land at present prices, outside a few central and thickly inhabited points, in greater quantity and under bet- ter conditions for use, than the entire work of the man for a lifetime would have sufficed to give him without regard to his subsistence fifty years since, or than he could have gained from the virgin forest at any time during the past century. In fact, good land under good cultivation, with good improvements upon it, capable of such use that it has sufficed for the subsistence of the best and most competent part of the population during the past cen- tury, may now be purchased for a sum of money representing far less than the money value which has been expended in clearing it and in building fences and walls. In 1880, all the crops of the country which required cultivation were made on less than three hundred thousand square miles out of three million square miles constituting the territory of the United States, and Production, Dislributio7i, Consumption. 305 that part under cultivation did not produce on the average more than half a fair crop, owing to the negligent and wasteful methods of culti- vation due to want of intelligence in the cultivator, or want of sufficient labor in the process. Since 1865 more than one hundred thousand miles of new railway have been furnished by capital, by means of which each acre of one million square miles of territory has been brought within five miles or less of a railway, and thereby brought within the reach of him who desires to occupy it at the cost of a few days spent on the way, as com- pared to months under previous conditions ; and when he reaches the land which he has selected, the price at which he can purchase it is the measure of less labor than has ever before been required to secure such possession. Under these conditions, are not the propositions which have been submitted in other essays fully proved ? ist. To wit, that under existing institutions and existing laws the working classes, in the sense in which they use that word, have been securing to their own use and enjoyment an increasing share of an increasing product. 2d. The richer classes controlling and using capital are securing to their use, control, and enjoyment a diminishing share of the same increasing product. 3d. The share which each person may secure to his own use and enjoyment of this increasing product, depends upon the development of his individual character and capacity. 4th. All laws restricting the free use of time and opportunity, and all by-laws limiting the use of time and talent or skill, are inconsis- tent with the progress of society and with the progress of the individual as well. 5th. Liberty sustained under just laws, is the condition under which the greatest welfare can be attained by him who possesses the capacity to grasp the opportunity now offered him. 20 SLOW-BURNING CONSTRUCTION -» SLOW-BURNING CONSTRUCTION.' THE fearful losses of life and property by fire in the United States have lately attracted the attention which is due to the causes of such loss and to the means for preventing them. Coincident with these investigations a very profound change in the conduct of the business of fire insurance companies is in progress. Until within a very recent period the management of an insurance company issuing policies of indemnity against loss by fire has consisted in taking risks as they might happen to be, a more or less careful in- spection having been made into the condition of the property before issuing a policy, for the purpose of estimating the rate of premium to be charged rather than with a view to improving such conditions. The notice of the owners or occupants has sometimes been called to glaring defects, and a somewhat desultory inspection has been main- tained ; not so much with the intention of informing the owner or occupant how to protect the property against fire, so as to reduce the loss to the lowest terms, as for the purpose of informing the under- writers, so that they may not take or maintain too low a rate of premium. In fact, there has been until recently a passive indifference and sometimes a frankly acknowledged objection on the part of promi- nent underwriters to the introduction of the most effective safeguards, lest the reduction of premiums that might be demanded should dimin- ish the profits of the insurance companies. It may be admitted that under this system many fire insurance companies have been established and conducted by men of conspicuous ability, with great profit to the stockholders and indirectly with great benefit to the assured. These companies have done a world-wide business, scattering their risks, and by the very breadth of their opera- tions and income, they have been enabled to reduce their premiums to the very lowest terms that the system itself would permit, subject as it has been to an excessive expense ; but as the amount of property at risk has increased in recent years with very great rapidity, the com- panies of a safe kind have been unable to carry the full lines required in the concentrated hazards of our great cities. Owners have therefore ' Reprinted from The Century I\Iagazine for February, i88g. 309 3 1 o The Industrial Progress of the Nation. been obliged to seek insurance wherever they could get it, sometimes exhausting all the fire insurance companies of the world. At the same time an unwholesome competition has grown up among the under- writers themselves by which their previously heavy expenses in the conduct of their business have been increased, while badly managed or small companies have been led to take risks at less than cost, — a method ending inevitably in bankruptcy or in withdrawal from business. In the opinion of competent experts from eighty to ninety percent, of all the stock fire insurance companies organized to transact business within the limits of the United States, or empowered thereto, have agencies in the State of New York, which renders it incumbent on them to make returns to the Commissioner of Insurance of that State giving a statement of all their transactions in the United States. There could be no better indication of the rapid growth of wealth in this country during the last twenty-five or thirty years than a comparison of the sum of the insurance written by these companies. In 1859, before the civil war, the sum of the risks taken by companies making these returns was a fraction under $1,500,000,000. In the year 1887 the amount in round numbers was $12,250,000,000. The proportion of loss to the value of the property insured has slowly diminished : there has been a little improvement in the con- struction of buildings in some of our great cities, though not much elsewhere, so that the loss by fire now ranges from $100,000,000 to $130,000,000 a year. The cost of sustaining fire insurance companies whose function is simply to distribute this loss over a wider field is about $65,000,000 a year ; to this must be added the cost of sustaining expensive fire departments, which may be computed at a minimum at not less than $25,000,000 a year, and it is probably more, to say nothing of the additional cost of Avater supply for fire purposes. The fire tax of the United States may therefore be estimated at a minimum of $180,- 000,000, or at a maximum of over $200,000,000, in a normal year in which no great conflagration occurs. Within the last five years a great change has taken place in the views of the leading men who conduct the business of the fire insur- ance companies, and a system is rapidly coming into vogue for the frequent inspection of buildings with a view to the prevention of loss by protecting them, so far as their generally bad construction will per- mit, from the dangers which must occur from fires that are unavoid- able, by installing apparatus to check the rapid spread of fires when they do occur. Doubtless a very considerable part of the present losses may be saved in this way, but the relief is only a palliation ; the true remedy will come only when the owner of the insured building realizes the simple fact that he himself is chiefly responsible for all the Slaiu-Biirnins' Construction. 3 1 1 losses that happen. It must be brought home to him that the true function of an insurance company is to distribute a loss when it occurs. True, it may be a part of the function of the officers of an insurance company to instruct an owner how to build his building and how to guard it after it is built ; but the owner himself, by his own control over the construction and the occupation of his building, is the only person who can remove the causes of loss by fire. It must be made apparent to the owner of property that if he pays a high rate of pre- mium for a policy of insurance // is his own fault j he makes the rate high by neglecting his own duty, and when he may afterward under- take to procure a contract of indemnity or policy of insurance at less than cost, he is an illustration of the old adage, " A fool and his money are soon parted." A contract made under such conditions is not worth the money paid for it. The cause of this enormous fire tax may be attributed mainly to the common practice of what has been perhaps well named " the art of combustible architecture." How can this waste be avoided ? It is useless to suggest the con- struction of buildings modelled on those of Europe, especially of those upon the Continent ; we have not a general supply of the soft and easily worked stone of which most of the buildings in Paris and in many other of the foreign cities are constructed — a stone which cuts like cheese and which hardens like iron upon exposure to the weather. In some of the States west of the Alleghanies there are considerable deposits of easily worked stone which hardens on exposure, but in the Eastern and the Middle States no such building-stone is found. Neither have we that abundance of low-priced manual labor which will enable us to construct buildings exclusively of brick and iron, without exceed- ing in cost the capital which can be applied to buildings required for ordinary purposes. Many labor-saving devices have indeed been adopted in the building trades, but on the whole a building of any kind is to a large extent the product of the hand rather than of the machine ; the stone must be cut, the mortar must be prepared, the brick must be laid, the timbers must be adjusted by hand-work, and all the costly finish must be put on by hand. Hence, although it is a rule that in all the arts to which modern machinery can be applied a low cost of production is consistent with or is the correlative of high wages or earnings, yet in arts which remain mainly handicrafts the rate of wages becomes one of the elements of a high cost of production or construction ; therefore the higher cost of building in this country as compared with the cost in Europe is in itself a proof of the greater relative prosperity of the members of the building trades, even though it results in higher rents to all others. Moreover, many of the articles which enter into the construction — especially of city warehouses, in. 3 1 2 The Industrial Progress of the Ahition. which the greatest losses by fire occur — are heavily increased in their cost by the present system of duties on foreign imports ; for instance, structural iron and steel, window glass of the better quality (especially plate glass), cement, and many building stones, to say nothing of the tax imposed upon Canadian lumber. We have, however, a greater relative abundance of timber than of other suitable building materials, and it follows that wood rightly enters into the construction of our buildings more than it does in most European countries, even in our factories, city warehouses, churches, and the like. Again, in the north- ern parts of the United States wood, properly cut and disposed in the building in a suitable manner, is almost a necessary part of the con- struction because of the climatic conditions ; stone and brick, when exposed to the extreme cold of the outer air of winter, draw moisture from within the building, which condenses on the inside of the walls and is apt to make the buildings very damp : especially churches, wherein the furnace may be lighted and the building kept warm for only a part of the week. The question therefore arises, Can buildings be constructed either wholly of timber, or of brick, stone, or iron for the outer walls, com- bined with wood for the inside construction, in such a way as to elim- inate the greater part of the causes of the fearful fire tax which now constitutes a waste equal to an average of at least fifteen per cent, on the net savings or possible additions to the capital of the country in a fairly prosperous year ? To this question an affirmative reply may be given. It is based on many years' experience in the construction of textile factories under the supervision and guidance of the mutual underwriters by whom these factories have been insured on an absolutely mutual principle for a period ranging from thirty to fifty years in respect to the principal companies. Witness the necessity for the solution of this problem. There are even now more cities than one in which a great conflagration exceed- ing that of either Boston or Chicago awaits but the accident of a spark and a favorable wind. It is therefore to be hoped that the time may not be far off when, by the bankruptcy or the withdrawal of only a moderate number of the existing insurance companies whose losses and expenses now exceed their income, a few great and powerful fire insurance companies may be enabled to impose conditions upon those who apply to them for insurance, under which conditions a remedy may be found for the existing faults, even if that remedy be not found sooner under the system of inspection and prevention now beginning, by which the danger of such a great conflagration may be almost if not wholly removed. It is not too much to claim that if a sum of money equal to that which is annually paid in premiums for policies of insurance on prop- Slow- Burning Construction. 3 1 3 erty situated within the so-called " dry-goods district " of New York and its immediate vicinity, covering about one hundred acres, were put at the disposal of the officers, engineers, and architects who are em- ployed by the factory mutual insurance companies of New England, to be by them applied to suitable appliances and safeguards for the pro- tection of that district, the danger of a great conflagration would be wholly removed and the destruction of even a single warehouse and its contents would be of the rarest occurrence. Strange to say, some of the worst examples of combustible archi- tecture are to be found among our prisons, hospitals, asylums, and alms-houses ; next, among college buildings, libraries, and school- houses ; to these may be added churches, hotels, and theatres. In the year 1887, according to the tables compiled by the CJiro7iicle oi New York, there were burned within the limits of the United States : 45 hospitals, asylums, almshouses, or jails, being nearly four per month, in many cases accompanied by the loss of a large number of lives. 126 college buildings and libraries, being ten and a half per month. 146 churches, being two and eight-tenths per week. 52 theatres and opera houses, being one per week. 515 hotels, being one and four-tenths per day. The bad construction of these buildings is due mainly to habit, to fear of innovation, and to distrust of theory. These inherited faults in construction may be readily traced to their origin. In order to make this matter plain, the evolution of the modern factory will be fully de- scribed in this article, illustrated by examples of the several types of building which have been from time to time constructed. When the textile factory system was first established, water power only was ap- plied to the movement of machinery. The larger factories were thus customarily placed in narrow valleys or upon very limited areas of land, below the falls of rivers and alongside the streams ; it therefore became necessary to economize the area of ground covered by the fac- tories and to build them many stories in height. When other arts be- gan to be conducted upon the factory system, the buildings were apt to be in cities or towns where the price of land forbade large areas being devoted to the purpose, and, again, buildings of many stories in height were constructed. As time went on, however, steam took the place of water power, while cheap railway service or rapid transit made it pos- sible to scatter the factories over a wider area. Factory buildings then began to be constructed in the open country, but apparently it did not occur either to the owner, the managers, the architects, or the builders that the reasons for constructing a building many stories in height did not apply to places where land could be had at a very low price ; there- fore the customarv bad and unsuitable form of construction was 3 1 4 The Industrial Progress of the Natioii. . adopted and is still practised where it is not only useless and unsafe but less adapted to the purpose to which the building is to be put than a one-story or a two-story building would be. Moreover, the whole method of cutting timber having been developed with a view to the supply of material required in the ordinary unsafe and unsuitable method of construction, it was for many years difficult to obtain material cut in a proper way for what has been called the slow-burning use of timber. Hence it follows that the art of slow-burning construc- tion is little known outside the limits of New England, and until very lately it was little known even there except to those who had become accustomed to the construction of textile factories, paper-mills, and other works which arq customarily insured by the factory mutual insur- ance companies. It is only within a very short time that the methods which have been practised for many years in the construction of textile factories — which are only the old methods of almost prehistoric time,, when timbers were shaped by the axe or by hand, before the modern saw-mill had rendered the construction of a sham building possible — have been taken up by a few architects of capacity and responsibility to be applied to warehouses, churches, college buildings, and occa- sionally to dwelling-houses. A most conspicuous example of the right method of dealing with timber and plank in a commercial warehouse may be found in the inside work of the huge building lately furnished and occupied by Mr. Marshall Field of Chicago, on plans made by the late Mr. H, H. Rich- ardson and carried out by his successors, the motive of the plan hav- ing been derived from the customary method of constructing a textile factory. In what does slow-burning construction consist ? It may be con- sidered somewhat amazing that so simple an art should not have been common for generations. We will begin at the weakest point in the common art of combustible architecture, to wit, with the roof, and de- scribe its evolution. It may be admitted that the modern factory roof waited for its possibility until right methods of covering a flat roof had been invented ; but even with respect to the roofs that are not flat, about ninety-five out of every hundred of those which are now build- ing are models of every thing that is bad. They convert the attic stories into ovens in summer, refrigerators in winter, and fire-traps all the time. It seems as if hardly any one, owner, architect, or builder, had ever put to himself the simple question, " What is the purpose of a roof ? " The plain answer obviously is, " To keep out the rain." Many of these " crazy roofs " of irregular form and full of leaky valleys fail even in that essential point. May it not be added to this main object of keeping out the rain that the subsidiary purpose of a roof is also to keep out the heat of the summer sun and to keep in the warmth 315 3 1 6 The Industrial Progress of the Nation. of the winter fuel ? May it not even be added that a roof may furnish a comfortable and convenient place to get a little fresh air by those who dwell in crowded cities ; or at least may not a good roof add one floor to a building where work which requires the outer air may be done comfortably and conveniently ? Are not the roofs of buildings in nearly all hot countries made great use of by the inhabitants ? Are they not invariably of thick, solid construction, flat enough to be occu- pied in hot summer nights ? In what country is there greater need for such a place of comfort and fresh air than in our Northern cities during the extreme heat of our summers ? In the country or upon the factory the flat roof might not be treated for use ; yet aside from use it is better in every respect, so far as safety, ventilation, and other ele- ments of comfort or utility are considered, than any other form of roof which can be put upon any kind of building. Are our architects capa- ble of making a flat-roofed building artistic, or pleasing to the taste ? It has been done in many instances ; why not in nearly all ? In the evolution of the factory all the faults have been discovered and remedied which now infest nearly all the warehouses, hospitals, dwelling-houses, schoolhouses, college buildings, and other examples of combustible architecture of this country. The first form of factory roof resembled the gambrel roof of the dwelling-house. In early days it was constructed of solid timbers set wide apart, as they should be, covered with good thick boards and shingled ; in some cases the shingles were laid over mortar. I have an example of shingles which are more than fifty years old yet still in good condition, having been preserved by the interposition of the mortar between the shingles and the roof boards. This method of outside construction might not be objected to in itself ; on the inside, however, the owners were apt to put vertical sheathing at a little distance from the eaves and horizontal sheathing across the upper timbers of the roof, making a cockloft. These- hol- low spaces, in which fire may spread out of the reach of water, are among the most dangerous elements of bad construction, especially when connected with the basement or the cellar by vertical flues in the walls or partitions of the building. The next form of roof came into vogue when heavy timbers were displaced by joist or plank rafters set closer together. It is commonly known among factory people as a "barn-roof," consisting of an ordi- nary pitched roof made of rafters set eighteen inches or two feet apart on centres, covered outside with thin boards and slated, sheathed inside vertically at the eaves, and horizontally across the apex. The older factory roof and the barn-roof are both shown in the accompanying illustration, which delineates an old mill from which a large establishment has been subsequently developed. 317 3 1 8 Tke Industrial Progress of the Nation. This barn-roof is the most abominable, unsafe, and atrocious roof ever devised for the covering of buildings of any kind. The slates serve to attract the heat of the sun, which beats in through the inter- stices of the open boards and converts the interspaces of the roof into ovens for the concentration of heat and for its distribution throughout the building, especially when the roof-spaces are connected with hol- low walls. The most effectual method of diffusing heat in a factory has proved to be to suspend the steam-heating pipes overhead, at some distance from the walls — the warm air following the cold air as it passes out by bottom ventilation. By analogy it may be assumed that the heat concentrated by the slates in the interspaces of a hollow roof diffuses itself through the hollow walls of a building of ordinary con- struction. Thus the thin-slated roof fails in summer as well as in winter. In this kind of roof a fire is completely protected from water ; the slates when exposed to outside heat are readily cracked ; they then fall and cut open the firemen's heads ; the interspaces at the eaves also make excellent nesting- places for the rats, which carry into them oily waste and other combustible substances to be ignited by spontaneous combustion in the heat of summer, to the partial or total destruction of many a mill. The next abomination came with what is called the French roof. This, when put upon the top of a factory, is nearly as bad as the barn- roof : it restricts the space in the attic within, adds greatly to the cost of the building, while in it are commonly repeated nearly all the faults of construction of the barn-roof. The next roof was a little better. It consisted of a flat roof made of ordinary plank rafters set eighteen inches or two feet apart on centres, covered on the outside with boards and then with composition or metal, and sheathed within upon the under side of the rafters. The humidity generated in any room warmer than the external air and in the processes of many of the manufacturing arts passes into the inter- stices of this roof, where the moisture is condensed on the under side of the thin boards of the outer covering, from which it drops upon the sheathing and rots it, while the interspaces add not only to the danger of fire, but work the speedy destruction of the whole roof by the rot- ting of the rafters, especially near or upon the walls. This roof was usually furnished with a hollow wooden cornice, also bad and dangerous. It remained for the officers of the Factory Mutual Insurance Company to suggest that the same solid floor which is required in the construction of the mill might well be adopted in the construction of the roof, only changed so as to give a pitch of half an inch to the foot. It was also suggested by the underwriters that the wooden covings and gutters and the sham hollow cornices, by means of which fire was conveyed from building to building in the great Boston conflagra- O O ■J A K E- U D H Z O u o H O u 319 320 The Industrial Progress of the Nation. tion, were a dangerous and superfluous element in the construction of the roof of the factory. In pursuance of these suggestions all the former bad forms described gave way to a simple deck constructed of three-inch-plank grooved and splined, placed on timbers set from eight to eleven feet apart on centres, sheathed underneath between the timbers if the owner desires a fine finish, and covered on the out- side with any of the customary materials ; the ends of the timbers THE FACTORY ROOF, FIRST DEVISED BY W. B. WHITING. sometimes projecting outside the wall and the deck carried far enough over to form a suitable coving, according to the height and character of the building ; or else the finish may consist of a brick cornice, without gutters, the drainage being below. Again : the old type of textile factory, from which the plans of a great many other factories have been derived, was very narrow and very high. It had not entered the minds of the constructors of the earlier factories that the spaces of wall between the windows might be very narrow and that the windows might be very wide ; nor had it apparently occurred to any one that the tops of the windows had bet- ter be carried up flush or even with the ceiling of each room in order that the light might be better diffused within. Consequently the wall of the factory consisted mainly of a great blank of brickwork with small holes in it for windows, the mill being seldom more than fifty- two feet wide, often less, and many stories in height. The illustration on page 321 shows mills of this type, nine stories high, including attics. The width of the mill was gradually extended and the size of the windows enlarged by degrees ; for many years about sixty-two feet was considered the proper width and the windows began to occupy a larger part of the wall space, while the wall itself was increased in thickness. At last it was discovered that if the tops of the windows were carried up flush with the ceiling and as much space, or a little more, was devoted to windows as to wall, the width of the mill might be carried to ninety feet ; then to a little over one hundred feet. o u o o Q ►J o Q W >- o H en W Q J .J tn z w ►J < 21 321 322 The Industrial Progress of the Nation. Until now in England, where the light is less intense than in this country, cotton-mills have been built five or six stories in height and one hundred and twenty-eight feet wide, — that being the width in which certain kinds of machinery can be most economically placed and oper- ated, — with six feet of window space to four feet of wall, the tops of the window panes being absolutely flush with the ceiling between the beams, and the window caps placed opposite the floors. Of late, how- ever, the mutual underwriters, having discovered the great danger of high buildings as compared with those of wide, low construction, began to ask their members who were about to build mills to be operated by AMOSKEAG MANUFACTURING CO., MANCHESTER, N. H. (CONSTRUCTED BY H. F. STRAW.) steam power in the open country : " Why do you follow this inherited and bad type of building ? A mill of two or three stories in height can be constructed at less cost per square foot of floor than a mill of any greater number of stories ; if you have room enough, even a one- story mill properly constructed may be built at as low a cost per square foot of floor as the mill of four or five stories, while it will be as warm in winter, cooler in summer, and lighter and better ventilated all the year round than any other type of mill can possibly be." Since that suggestion was made a large number of factories of only one story in I^,-' 323 324 The Industrial Progress of the Nation. height, covered in with three-inch pine roofs, protected outside with gravel roofiftg, tin, or with cotton duck properly prepared, and lighted with what are known as monitors, have been constructed in many parts of New England, ranging from half an acre to three and a half acres in size ; a very common type being a mill of sixty thousand feet on the main floor, constructed on a moderate slope so as to give a basement under one third of the mill for wet work or for other subsidiary pur- poses. Such one-story buildings are best adapted to weaving, and are often built in connection with spinning-mills of two or three stories in height. One Story Mill. )etaiU _/&aJe I in . ift 'I''La Xo^r Csv*r-tny rrm^ Atf 0m4W#, TTH^ttJ fir- co^^n tZa^A vrvBfr-ty JB^yt Au ff w* t DETAIL OF ONE-STORY MILL. — NO. 2. In one instance, in a case where the machinery is very heavy and is subject to great vibration, a one-story mill of this sort was substituted for one of two four-story factories which had been burned ; the owners were advised to reconstruct a one-story mill in place of the burned mill, but to make it large enough to accommodate all the machinery then in the other four-story mill which had not been destroyed. They were warned that the new mill would bankrupt the old one on account of the greater economy of the work and the better conditions for its •a ■ tS 3 p J* o u z I—* H i Q M > a Q o H en ^; o 325 ;26 TJie IndusijHal Progress of the JVation. operation. The prophecy has proved true : sixty-seven men accom- plished the work in the new one-story mill on the same machinery which required one hundred men in the old four-story mill ; therefore that old mill has been taken down in order to make way for the exten- sion of the one-story factory, and the old material has been put together in a better form. What, then, is the slow-burning construction ? It consists simply in consolidating the wooden material in frame, floor, and roof in such a way that a fire can be held long enough in any room in which it One Story Mill. ^ssaaw^-a^gj^s^ ManUerFtnh may te «? I'JU^ Gt'r-Oera anit fyinSctet mat/ 6* u^ m ti„ .f )„ M-;,-^^'/.*. >-• f--n''"i >o#U «rm4--* '2 hetA^ik o|'TVonitoK" ICiNer y, ^ iOlfU-^^ DETAIL OF ONE-STORY MILL. — NO. 3. may originate for a fairly competent fire department, public or private, to get it under control, or where it may be extinguished or held in check by sprinklers. The timbers used may be solid or may be cut in two parts to be bolted together. The latter is perhaps the better way, in order that the air may reach the centre of the timber and season it, great care also being taken in mill practice not to paint, oil, or varnish the outside of any heavy timber for at least three years after it has been placed in the building, lest what is called dry rot should occur from the fermentation of the sap in the green timber. Where an outside finish 328 The Industrial Progress of the Nation. is required some architects use the timbers in two parts bolted together with an air space between, each timber being also bored through the centre lengthwise for ventilation. This latter plan is the customary method with posts when wood is used for supports, a crossway hole be- ing also bored near the top and bottom, connecting with the centre. Upon these heavy timbers — which are commonly placed eight or ten feet on centres resting directly on properly adjusted posts without the interposition of any girders lengthwise of the building, in lengths or spans from eighteen to twenty-two feet — the floors are laid of plank not less than three inches thick when the beams are eight feet on the centres. If the beams are ten feet or even twelve feet apart on centres, ordinary weights will be carried by floors consisting of four-inch or five-inch plank ; the timbers themselves may be from fifteen to not exceeding twenty-two feet in length from wall to post and from post to post, for ordinary factory loads. If provision is required for extra- ordinary loads, a special computation should be made to meet the case. If a fine finish is desired, sheathing may be placed underneath between the timbers, nailed close to the under side of the plank ; if the most absolute security against fire is called for, the finishing may consist of plastering laid on wjre lathing close against the plank. This plastering may be carried around the outside of the timber on the line of the timbers, provided no skim coat of lime putty is put upon the plas- tering, thereby cutting off the air from the timber. The top floor may be laid directly upon the plank, or a layer of mortar may be laid between the plank and the top floor ; in some cases asbestos paper has been interposed. The layer of mortar offers great security in prevent- ing the passage of fire downward. The roof which has been described corresponds substantially to the floor, to wit : three-inch plank laid upon the timbers, one-inch sheathing on the under side if desired, and sometimes one-inch boarding on the plank ; then the ordinary outer covering of whatever kind may be adopted. If the roof is exposed to great humidity within, as in the machine-room of a paper-mill, one inch of mortar may be interposed between the roof boards and the plank. This latter roof proves to be impervious to cold or heat, and with proper means of ventilation gives security against any possible conden- sation of moisture from the atmosphere within. An alternative plan consists in setting the first line of posts at the right distance from the wall to make a passage-way, the floor of the alley being laid of two thicknesses of plank crossed — the posts being fitted with hackmatack knees. This form of horizontal truss braced to wall and post gives great stability to the building. If the building is over one story in height the stairways ought to be placed either in separate towers outside the building proper, or else in the corners of the building surrounded by brick walls, the doorways Slow-Burning Constrticlion. 329 being protected by adequate fire-doors consisting of wood encased in tin, iron being one of the most treacherous materials customarily made use of for the protection of doorways in party walls. In such a factory no cornice is required or permitted, and no sheathing within, set off by furrings from the wall can be tolerated. No concealed space is allowed anywhere in which a fire can pass from room to room or from cellar to attic. Every part of the building must be open, so that water from bucket or hose can be thrown anywhere. CONSTRUCTION OF FACTORY DEVISED BY EDWARD ATKINSON, THE PURPOSE BEING TO CONSTRUCT THE ALLEYWAYS SO THAT THEY SHALL BECOME HORIZONTAL TRUSSES, TO PREVENT THE VIBRATION OF THE STRUCTURE. If these plans and specifications are compared with the ordinary method of combustible architecture, the reason will be apparent why textile factories, paper-mills, and other works are better fire risks and are insured at less cost than the average so-called stone church, brick hospital or asylum, or iron warehouse, although the nature of the work done carries with it almost every cause of fire hazard from ignition, friction, or spontaneous combustion, while in many cases the material used is almost explosive. The method of Sartor Resartus may well be applied to the average hospital or asylum. What is it but a sham ? a picture composed of brick or stone clothing or screening a whited sepulchre well prepared for the cremation of the inmates ? It consists of an outer wall of brick or stone inclosing a wooden structure of the most dangerous kind ; it is usually but a system of combustible wooden cells each connected with the other from cellar to attic by open wooden ways in walls, floors, and partitions alike. Had the motive been to house the inmates of most hospitals, asylums, and hotels under conditions which should assure the greatest possible destruction of life and property from the 330 The Industrial Progress of the Nation. least possible cause, greater success could not have been secured than has been attained in most of these buildings, in many of which the danger is enormously increased by the use of gasolene vapor for light- ing. How soon a remedy may be found for these faults rests with the public to decide. The builders of factories in city or in country may perhaps derive some useful information from this description of DIAGRAM SHOWING THE OUTER LINE OF POSTS (HORIZONTAL TRUSSES OR ALLEY- WAYS) AND OUTER WALLS, SO ADJUSTED THAT THE FLOORS INSIDE THIS LINE OF POSTS MAY FALL AWAY FROM THEM WITHOUT STRAINING THE POSTS OR THE WALL. IN ANY CUSTOMARY METHOD THESE POSTS SHOULD BE FIRE- PROOF. slow-burning construction, for the reason that if carried out consist- ently and economically it will cost less than the ordinary method of combustible architecture. It may be interesting to add that a mill building of from three to five stories in height can now be constructed in New England in ac- cordance with these plans at a cost above the foundation varying from sixty to seventy-five cents per square foot of floor, counting every floor, but not counting the basement unless it is a high basement, to Slaw-Burning Co7istructiou. 331 be made use of in the same way that the other floors are used. The cost per square foot of floor will vary somewhat according to the posi- tion, and according to the interior finish required with respect to sheathing and other matters. A mill two stories in height, /. ^., of two floors for use, can be constructed at somewhat less cost, as the walls may be lighter in proportion to the area. POSTS, PINTLES, AND CAPS CUSTOMARILY ADOPTED IN MILL CONSTRUCTION. Under ordinary conditions a mill of one story in height can be constructed at about the same cost per square foot of floor as the four- or five-story mill if the ground is level and the subsoil is such as not to require any excessive expenditure in the foundation. A lighter framework and less expensive methods have been adopted in some cases in one-story construction, so that the cost of the building per square foot of floor has been considerably less than the sum named-^ even as low as fifty cents per square foot of floor. For many pur- poses, such as for shoe factories or other light work, these changes and this kind of economy may be admitted, provided a false economy is not applied in the construction of the roof. The whole comfort and 332 The Industrial Progress of the Nation. welfare of the operative in the one-story factory depends upon the solid construction of the roof and the monitors, the plank to be three inches thick. Ordinary sloping skylights should never be permitted, as they transmit heat ; while the monitor, with its vertical windows, reflects the heat and may be made use of to promote ventilation. In all cases the windows in the monitor either should be double or the AUTOMATIC FIRE-DOOR. sash should be glazed with two plates of glass in the same frame, in_ order that the condensation of moisture on the inside of the windows may be avoided. Experience proves that these flat-roofed buildings, even when constructed from one to three acres in extent, are not more liable to collect snow than are other forms of roof, and they are ' Specifications for Automatic Fire-Door. — Door to be made of dry pine, matched boards, |- in. thick : for all door openings smaller than 4 ft. X 6 ft., to be made of two thicknesses, crossed as shown at H and I on plan, and for all door openings larger than 4 ft. X 6 ft., of three thicknesses crossed, to be thoroughly nailed with clinch nails. The finished door to be covered with heavy tin upon the whole surfaces and edges, leaving no wood exposed ; tin to be lock-jointed and without solder. The edges to be covered by sheets lapping around on either side, as shown at A on plan, so as to leave no joint on the edge. Door to be hung by strong "barn-door hangers," which may be found at any hardware store. The rail may be fastened directly the wall, or, if necessary, put upon a wooden stringer tinned on the outside. In either case, the rail is to be bolted to the wall by bolts passing through the wall. In no case must the rail be fastened to a wooden rail which is held by nails or spikes driven into wooden plugs driven into drill-holes in the wall. All woodwork to be tinned. Door hangers to be fastened to door by carriage-bolts through the door, and not by wood screws. A wooden jamb-casing " K " to be fastened to the wall by through-bolts, at the lower side of door-way, with a wedge recess to receive the door and force it against the Slow- Burning ConstrMction. 333 very much more easily cleared of the snow when it does collect. The English saw-toothed roof, so called, generally placed over their weav- ing buildings, has not proved to be desirable in this country north of Philadeli)hia owing to the tendency of the snow to collect in the valleys ; it is also more costly than the roof of the one-story building lighted by monitors, as given in the previous. The light in the saw- toothed roof being always taken from the north may possess a slight advantage, but in the monitor the windows towards the south can be clouded so that there will be no objectionable glare within the room. The plan has been adopted in many cases of carrying the brick- work to the roof between the windows ; more often, though, the brick or stonework is carried only to the windowsills, the superstructure being wholly of timber and glass. In many cases it is desirable that there should be no open space under the floor, both with the view to avoid danger and to give stabil- ity and freedom from vibration to heavy machinery. To meet these conditions special plans are furnished by the factory mutual companies for laying plank directly on the ground without danger of decay. It is not a pleasant experience for the officers and inspectors of the factory mutual insurance companies to pass, day by day, bad examples of combustible architecture occupied as shoe factories, clothing fac- tories, and the like, or to see other unsafe buildings in which branches of industry are conducted which have not yet come under the super- vision of skilled inspectors and underwriters, but which in their intrin- sic hazard are safer than the textile arts. It is not pleasant to witness the mushroom growth of five-story wooden buildings standing often in the middle of a field where land is of little value, in which hundreds of people may be daily exposed to great danger, and hundreds of brick jamb, as shown by section of K. All to be thoroughly covered with tin, same as door. Jamb-casing to be made of stuff not less than two inches thick. A stop, shown at F, to be fastened to floor, placed so as to crowd the bottom of door against the brick jamb. An automatic door-closer, shown at D, with fusible joint, E, to be placed upon each door, when, for convenience of work, the door must be kept open. One end of the rod which keeps the door open can be held over a hook, from which it can be removed at night, in order to close the door. The rod, made of wood, is cut diagonally across the middle, but is held firm by the copper sleeve, F. This sleeve is made in four parts, each soldered longitudinally to the other, with solder which melts at 1 60°. It is expected to yield and to permit the door to close from the heat of a fire at a con- siderable distance. If the door must be painted, white paint only must be used. The tin reflecting the heat, it is best not to paint at all. A threshold from \\ in. to 3 in. thick should be placed in door-way to prevent flow of water, in case of a small fire, from one room to another. This door was first devised by Hon. Byron Weston, for use in his pa]ier-niill. The automatic-closing apparatus has since been added. 334 ^^^' Industrial Progress of the Nation. thousands or even millions of dollars' worth of property are subject ta a heavy charge for insurance because the buildings have no right to exist. These officers and inspectors know from their own experience or that of their predecessors, covering fifty years, that more commodi- ous, better ventilated, better lighted, more comfortable, and safer buildings could be constructed for the same or for less money than these examples of combustible architecture usually cost. It would not be within the province of this article to describe the customary equipment of factories with pumps, pipes, hydrants, auto- matic sprinklers, watchman's electric record clocks, fire-escapes, and the like ; all these safeguards are fully described in the technical pub- lications of the factory mutual insurance companies. The purpose of this paper is only to call attention to the relatively low cost of slow- burning construction, and to suggest that because the customary methods of building are bad it is not therefore necessary to rush to the opposite extreme and to spend money in futile attempts at fire-proof building for ordinary uses. In fact, there is no such thing as a fire- proof building : a building may be constructed wholly of incombusti- ble material and may yet be totally destroyed by the combustion of the contents, especially when the iron members of such a building are unprotected from the heat of a fire among the contents. Granite is one of the most worthless materials for withstanding heat. In a re- cent fire in one of the factories insured under the supervision of the writer a granite post 12X12 inches was reduced to sand by the same fire that burned into a wooden post next to the granite less than one inch. Sandstone and marble are not quite so bad ; unprotected iron is most treacherous and unsafe, especially cast iron ; brick, having already passed the ordeal of fire, is substantially indestructible, and when combined in a suitable manner with heavy timber and plank, the latter being protected by wire lathing or by other methods for re- tarding the action of heat, serves the best for the safest construction. In recent years the profession of the architect has been raised above that of a mere artist or draughtsman, capable only of making an attractive elevation and of planning a building with little regard to the safe or suitable disposition of the material, to the level of some of the architects of old time, who, like Brunelleschi, combined with the func- tions of the artist the skill of the craftsman, the builder, and the en- gineer. The progress of combustible architecture is therefore likely to be checked as the young men who are now graduating from the Massachusetts Institute of Technology and from other architectural schools supply the places of those who, having had no technical knowledge themselves, have been unable to prevent the owners and contractors from committing the follies in construction by which our cities are now rendered so dangerous. Slow- Bur iiiiig Coiistyuctio7i. 335 Objection has at times been taken by some architects to the com- ments of the mutual underwriters upon the architects' customary methods, that the factory building planned and constructed under their supervision is but a shell or skeleton of the building which the architect is commonly called upon to plan and supervise. This may be admitted ; yet there have been, and are, architects who have proved themselves competent to clothe this skeleton and to adapt it to more aesthetic purposes than the factory, by covering the timbers in such a way as to make the method of construction even safer and more slow-burning than when the timbers are left clear, without losing sight of the prime motive — safety of property and of life. The great warehouse built by Richardson and his successors for Marshall Field is but a glorified cotton factory, and the lovely little building connected with the home office of Mr. Richardson in which his art treasures were safely housed was but the picker building of a cotton factory with a touch of genius added. Moreover, the architects themselves are now finding it expedient to adopt the same method of subdivision in their work which has become necessary not only in many of the practical arts but even in the legal profession, viz., either to employ special experts in the different de- partments, or else to organize firms in which one should be the artist, another the builder, another the engineer. Modern requirements make specialization necessary, and there are few indeed who can qual- ify themselves for all the requirements of almost any profession. In view of the attention which is now being given to the applica- tion of the " factory floor " (as it is called) and the " factory roof " to other buildings, it may be that the time is not far distant when it will be safe and prudent for the owner who intends to construct a textile factory to employ a professional architect without incurring the danger that the purpose to which the building is to be put will be lost sight of in the attempt to apply meretricious or misplaced art to a building in which economy and utility must not be disregarded. THE MISSING SCIENCE 22 THE MISSING SCIENCE.' COCTOR NON DOCTOR. [In public addresses and in private demonstrations Mr. Edward Atkinson of Bos- ton has shown the remarkable results of his investigations on cookery. He has now made such arrangements that others can profit by them. The " Aladdin " cook-box, or portable stove, which can be carried anywhere and used anywhere, is now ready for sale. Mr. Atkinson permits us to print some passages from a paper which he read to the Boston Thursday Club, one of the oldest and most distinguished of the Boston clubs. The reader will see at once that the new invention takes rank among the foremost improvements which affect the health, comfort, and larger life of our time. — Editor.] THE Struggle to support the material life of men and women is directed : First : To putting a few bits of board, supported by brick, timber, or stone, over our heads for shelter. Second : In this, the best-clothed country in the world, to con- verting on an average each year sixteen pounds of cotton and ten pounds of wool per capita into cloth, carpets, blankets, and other textile fabrics. [An average family of five persons consumes annually eighty pounds of cotton, worth $8.00, and fifty pounds of wool, worth, in the grease, $10.00 per year.] The average of raw cotton and wool per capita being about $r.8o. Third : To securing our food and preparing it, the proportion varying in some measure with the section of the country and the climate. The provision for shelter and the adequacy of the shelter varies more than any other element in life in ratio to the income of the family. Working people do not have as many clothes at one time, but they wear out more clothing than the well-to-do. There is a closer approach to communism or equality in the food supply than in any other element of life ; food differs in quality more than in quantity, but the working-man can eat more and digest more than the man of leisure. An average workingman at moderate work must have one quarter of a pound of nitrogeneous food or protein, one-eighth of a ' Reprinted from Lend-a-hand. 339 340 The Industrial Progress of the Nation. pound of fat, and one and a quarter pounds of starch every day, com- bined with water, making three and a half to four pounds a day. Those who do the hardest work require more fat and protein and less starch. Physiologists differ a little as to the relative chemical proportion of the nutrients which are considered necessary for subsistence, yet when their formulae are reduced to calories, or mechanical equivalents of heat, the dietaries established by Voit, Playfair, and others become almost identical. The application of the system of calories, or the mechanical equivalents of heat, to the food question, has been invented and adopted by Professor Atwater in his researches upon food, with some very curious results. On comparing two tables of the amounts of food consumed by working-men, he struck two cases where the heat units of the food said to be consumed were double that of a German soldier on a forced march. Thinking there must be an error in the statement, he investigated more closely. In both cases he struck a brick-yard ; one in Somerville, Mass., the other near Middle- town, Conn. In both these cases the proprietors had found that they could obtain the greatest tale of bricks by feeding their workmen with the largest amount of beef : the dietaries were correct at double the amount of food consumed by the German soldier. When computed by the day the requisite amount of food seems small ; three to five pounds of solid and liquid food to an average working-man ; by the year, however, according to our extravagant mode of using food, so much of which is wasted, each adult needs to have prepared for him two hundred to three hundred pounds of meat, about two hundred pounds of flour, making two hundred and eighty pounds of bread, fifty to one hundred pounds of milk, fifty to one hundred pounds of butter, fifty to one hundred pounds of sugar, six hundred to seven hundred pounds of vegetables, one hundred pounds of salt, pepper, cheese, fruit, spices, and sundries, making from fifteen hundred to seventeen hundred pounds in all. In many cases, in the families of the well-to-do, a ton of food is converted to use or to waste, as the case may be, in each year for each person. The fiour, meat, and butter may be brought over the railway one or two thousand miles at the price of a day's wages of a working-man. In the past few years all the utilitarian sciences have been wonder- fully developed, and scientific methods have been applied in almost all arts relating to the production and distribution of materials ; but there is one art, perhaps the most important of all in its relation to the mate- rial, moral, and intellectual welfare of the community, to which little or no science has as yet been applied ; in which there is no well devel- oped technical art capable of being taught upon a scientific method, or of being learned except by empirical practice, and that empirical prac- The Missing Science. 341 tice is usually conducted by a very ignorant class of persons. That factor in life upon which comfort, health, and strength most fully de- pend has been almost entirely overlooked, ignored, and neglected to the end that I can find no book treating this subject which even approaches the standard of science as applied in the other arts ; no attem])ts are made to teach this fundamental art, on v/hich we all depend, that are above the level of a mere jumble of empirical devices. This fundamental science to which I refer is the science of applying heat to the materials which we eat, commonly called cooking. I think that you will all concur with me in this statement when I set before you the facts which are capable of illustration, and which will be illus- trated by the apparatus now before you.' In any family in which two kerosene lamps, each having a circular wick of one and a quarter to one and a half inches diameter, are burned for the purpose of lighting the household four hours, a sufficient amount of heat is wasted to cook fifty to sixty pounds of bread, meat, and vegetable food, with the ex- penditure of one quart to three pints of kerosene oil, costing by the barrel, for the best quality, two and one half cents per quart. Sixty pounds of cooked food would be sufficient for the supply of fifteen adult working people. In this oven which is made of wood-pulp one inch in thickness, I can prepare four charges of food in eight hours ; two charges of ten pounds each of bread, two charges of fifteen pounds each of fish, meat, vegetables, and puddings. By its use a family of five persons can do every thing but fry ; they can stew, simmer, bake, and roast in this oven, and can readily prepare twenty pounds of food a day, with a consumption of oil not exceeding two cents' worth. I have placed in this oven three and one half pounds of round steak, with one half pound of suet, two pounds of corned-beef, two pounds of salt codfish, one half pound salt pork, three pounds of veal, one pound of ham, two pounds of potatoes, one half pound of beets, one half pound of carrots, one pound of cornmeal, one pound of oat- meal, and one and a half pounds of milk, making nineteen pounds in all, combined in six different dishes, the total cost being $2.10. These are all dishes which require long, slow cooking, and they have been subjected to the heat of the lamp for four hours. The corresponding starchy food which should be added to this ration of meat and other articles would be sixteen to twenty pounds of bread, sixteen to twenty pounds of potatoes, and a few condiments. The whole cost of sixty pounds in this combination, which would be cooked on the same day in this oven, with one quart of oil costing two and one half cents, would be $3.20, making sixteen full rations at twenty cents each for an aver- ' This was written for a club, and while being read twelve separate preparations of food were cooked in two ovens with two lamps. 342 The Industrial Progress of the Nation. age working-man, or twenty average rations for a working-woman not engaged in arduous or mechanical labor. In this other oven of a little different construction I have prepared some rather fine cooking ; the contents are four pounds of the best sirloin and tenderloin steak, cut very thick, without bone or flank, pre- pared with mushrooms ; three pounds of halibut a la creme ; eight quail, a dish of macaroni, a dish of stewed celery, a dish of salsify, or oyster plant. There is hardly room for the right proportion of pota- toes with these six dishes, and I have therefore decided that the family oven for a family of eight persons should be two inches longer in order to make room for the additional quantity of vegetable food called for with this quantity of fish and meat. A good deal more could be put in if tin pans were used instead of vegetable dishes, but I think that fine cooking is better done in porcelain or in china than in metal. Now when we consider the nature — I may say the infernal nature — of the common cooking range or stove or frying-pan, as commonly used, especially infernal in summer in the small houses and dwelling- places of the working people, T think that you will be prepared to admit that there has as yet been no practical science in applying heat to the cooking of food. There has been a great deal of art and perhaps some science applied to the preparation of food to be cooked, but this is a separate matter. Now, when we bear in mind that the price paid for the materials of food by ninety per cent, of the people of this country takes up one half of the income of the family, or more, I think that you will again concur with me that there is no new science which could be presented for your consideration of greater importance than the science in which I pro- pose to make a crude beginning at this time. Let me refer to the common impression that the rice-fed coolies of India and China are very strong, and that they derive their strength exclusively from their diet of rice. Now rice is almost all starch ; it contains a very small amount of protein, or nitrogeneous material,, which is necessary for the formation of muscle ; hence a rice-fed popu- lation would be an under-fed population. In a recent report which I have received, made on behalf of the English government, the compe- tition of India wheat with that raised by English farmers is treated, and the limit of production of the wheat which can be exported is stated to be the amount of available land which can be spared from the cultiva- tion of rice and pulse. That viord pulse reveals the secret ; leguminous plants, peas, beans, and the like, are rich in nitrogen, and by that report it appears that a much larger proportion of land is devoted in India to the cultivation of the pulse crop than to the rice crop. There is also The Missing Science. 343 an upland rice of which we know little in this country, which I have reason to believe is more nutritious than the swamp rice. While the ordinary cookery book is deficient in any scientific instruction, yet there is one noted cookery book which contains a famous receipt — Mrs. Glass, in her celebrated receipt for cooking a hare, says : '' You must first catch your hare." In my instructions for cooking I lay down the rule : " You must first catch your heat, and then keep it where it will do the work in the right way." My first hint how to do this was derived from a description of the Norwegian Cooking Bo.x ; I had never seen one. The instinct of the Norwegians had taught them that the most suitable buildings for their climate should be built of timber and plank massed together in thick walls, wood being the most effective of all non-conductors of heat that could be put to common use. The Norwegian cooking apparatus consists of a box of wood lined with hair felt, or fur, and then with metal. A smaller box made of metal, adapted to receive the food, fits loosely in this outer case. The space around this inner box is filled with boiling water, and the heat, being kept in by the non-conducting outer wall, does its work upon the food, of course at somewhat below the boiling point. This proves at once to you that there is no necessary connection between the boiling point, which at our sea level is 212 degrees Fahrenheit, and the degree of heat necessary to do the cooking of our food. This fact was dis- covered by accident, even by Count Rumford, who had thought that the way to boil meat is to boil it; when, in fact, the way to spoil meat is to boil it. A leg of mutton was accidentally left by him all night in a drying room used for other purposes, and exposed to a heat from about 140 to 180 degrees, as I remember the statement ; in the morning, to Count Rumford's surprise, instead of being dried up, it was nutri- tiously cooked and of full flavor. In order to convert the Norwegian Cooking Box into a constant cooker, all that was necessary for me to do was to add a circulatory apparatus similar to the one with which your bath boilers are heated. This was the apparatus which I brought to a meeting of the club three or four years ago. Into it a working-man may put the materials for a hearty breakfast, light the lamp, go to bed, and on getting up find his breakfast ready ; but with that apparatus I could only simmer and stew, and the American people will not be satisfied with stews. In some of the reports of the lectures which I gave to the working-men, when put on file in the public libraries, curious comments have been made. For instance: ''We don't want your pigwash," "We won't have bone soup ; we want sirloin," etc., etc. I have therefore substi- 344 ^^'^ Industrial Progress of the Natio7i. tuted a column of heated air for the column of heated water in this oven, in which you can not only simmer and stew, but also roast and bake. There is, as you will observe, no direct communication between the lamp, or source of heat, and the inside of the inner oven, in which the food is placed ; therefore if the lamp smokes or gives off fumes of kerosene oil, for want of being rightly trimmed, the food is not tainted. I have made no attempt to promote the general introduction of this apparatus, until it should be completely perfected and reduced in cost. My first experimental ovens were wholly made of metal, filled with non-conducting material, and were costly. We have used this apparatus in my own family for more than one year, and have done, at least, nine tenths of our cooking with it. We have been obliged to light the range to warm the kitchen, and, it being lighted, some of the breakfast cooking has been done on it. I also light my household with kerosene oil, as I detest gas-light. Our family consists of from ten to twelve persons ; I buy the best oil by the barrel, and it costs me ten cents a gallon. My bill of oil for lighting and cooking for the year has been thirty dollars. A lunch has been established for the employees in my own ofifice, as well as for myself. About twenty persons are served with a sub- stantial mid-day meal every day ; since we began a little over four thousand meals have been served. We are obliged to buy our oil in small parcels, at retail prices, therefore the cost of fuel has been seven tenths of a cent per meal ; at wholesale it would have been one half a cent. The plan works to the great benefit of the employees, whose mid-day lunch, or dinner, costs them eighteen to twenty cents each for food and fuel. Astonishing as these facts are in regard to the economy of fuel, I am of the opinion that this is purely a secondary matter ; economy of food is of the first importance, coupled with the saving of work on the part of the cook. I have proved, I think conclusively, that the oper- ation of heating a room, or of heating water for circulation through the house, is absolutely inconsistent with the true methods of cooking. Heat cannot be properly regulated for cooking when applied to other purposes. If I were to build again, I should make arrangements for heating the water from the furnace, with a small heater set alongside .the furnace for summer use, and in place of the range in the kitchen I would put a small heater, like a flat-iron heater, with a place to boil water on the top. One of my friends has built and furnished a house in this way and is quite enthusiastic over it. I might add a grill, which is very useful in any household, but my main dependence for cooking would be upon the lamp, or Aladdin, oven. , In the development of the science of cooking I think it will ap- pear that there is a true degree of heat by which flavors are developed The Missing Science. 345 or actually created ; for instance, if we grind green coffee we get no good result and no true flavor ; if we roast it too much we destroy the flavor and get an acrid and impalatable residuum. If we apply the exact degree of heat to roasting the berry, we develop the flavor and other qualities which are desired. I have lately observed that the same rule seems to apply in the application of heat to meat, fish, vege- tables, and meal, especially cornmeal. If not cooked enough, meat will be sapid and flavorless ; if cooked too much, flavorless and soggy ; if cooked at the exact point, the finest flavors are developed, especially in fish and fruit. The advantages which are beginning to be apparent in the use of these ovens are as follows : First : In respect to bread. Bread baked twice the usual time at 300 to 320 degrees Fahrenheit does not quickly become covered with a hard crust, as in the common stove. This crust when formed is a non-conductor, being like wood, carbonaceous in character ; this pre- vents the penetration of heat, so that the interior of the loaf is not cooked. It is also said that in such case the yeast plant is not killed and may go on fermenting, or else the bread moulds quickly or dries up. In bread baked in my oven the heat penetrates to the very centre ; it may be eaten fresh with impunity, and can be kept sweet for many days. It may even be over-baked with good results. In some of the over- baked loaves, especially those which are three or four days old, there is a crust-like flavor throughout, probably due to the partial conver- sion of the starch into dextrine. I have kept bread of this kind in good condition for eight days. Second : In respect to meat. It begins to be apparent that the right method of cooking meat is to keep it at such a degree of heat as will cook it without dissociating or " cracking " the animal fats or converting the juices into volatile vapor. Cooked in this way tough meat becomes tender. I also find that in proportion to the freedom from the smell of cooking is the flavor retained. I am informed by physicians that when animal fats are cooked in this way the fats of the meat remain nutritious and digestible, whereas, if the fats are exposed to a high degree of heat, so that the volatile parts are ^''cracked" or dissociated, the remainder of the fat becomes acrid and indigestible. It is possible that we may impute the prevailing dyspepsia of the day to the highly heated ovens of the range or stove in their effect on fats, as well as to the frying-pan. There is one point which requires a little skill : it is difficult to brown meats or poultry so as to give as good an appearance as is desirable. We have succeeded fairly well in imparting a brown appearance and appetizing look to many of our dishes by the skilful use of powdered crackers and butter, which brown more readilv than the fat of the 7 * 34^ The Industrial Progress of the Nation. meat itself. But, in order to give a fine esthetic effect to a bird or a joint, all that is necessary to be done is to have a larger lamp, or such as I call a Jumbo lamp, whose wick is nine inches in circumference, and which is 1 60 candle power, for final use. A short and careful applica- tion of this lamp for ten or fifteen minutes does the work of browning extremely well. I have taught three cooks of average capacity how to use these ovens each in a single lesson, and they have never served a meal in which any part was spoiled. Occasionally some kind of vegetable (vegetables requiring a higher degree of heat than meat), with which we were not perfectly familiar, has been served underdone. Sometimes a big joint of meat has not been kept in the oven quite long enough. We have been obliged to experiment with each oven ; each has a different normal^ so to speak ; but we have cooked to perfection in comparison with any other method, sirloins of beef weighing twenty-four pounds, turkeys, and geese weighing eighteen pounds each, a whole saddle of venison, which weighed, untrimmed, twenty-five pounds, and also single pounds of meat and small birds ; all weights and kinds have been put to the test. Parts of the meat, like the flank of the sirloin, which are spoiled when roasted with the joint, we cut off and simmer in the cooker, and afterwards convert into the most appetizing dishes in the oven. Again, meat which has not been subjected to a high degree of heat makes a better hash or mince, and has no unpleasant tang. It would be difficult to distinguish between two turkeys, one re-heated and the other freshly cooked ; I attribute this to the fact that the fats are not dissociated by the low temperature, and there is no flavor of grease rendered. This is all I yet know about this somewhat crude invention some- what crudely used ; the whole field of this new science remains to be explored. I have somewhat to my own surprise, lately come into possession of a small literary income. I have somewhat the same feeling about it that I had when I received a check for my first article printed in the Atlantic Monthly j it did not seem to belong to me, I therefore expended it for Christmas presents, and my children were somewhat surprised at my unwonted liberality. The next year, not having received a check, my presents were smaller, and my little girl asked me why I did not give them more. " I have no money to spend this year," I replied. At which she rejoined : " Well, papa, I think you might write another article for the Atlantic j anybody might do that ! " But when one is engaged in active business, and can only give little bits of time to literary work, without any real opportunity for consecu- 77^^? Missing Science, 347 tive thought, a literary income hardly seems earned. I have therefore devoted the fee of an article yet to be written to experiments conducted by Miss Marion Talbot, under the superintendence of Mrs. Richards, at the Institute of Technology, by which I have, at least, partly proved that all my theories are well grounded. Miss Talbot's report is a model in scientific form. After describing the personal equation, and after referring to the eminent olfactory abilities of one of the professors, she says : " Miss Talbot came to the work with some training in physics and chemistry, a knowledge of housekeeping and marketing, considerable ease in turning from one occupation to another, and almost uniform failure in the few attempts she had made to cook in an ordinary stove or range. Miss Bragg's ignorance in regard to cooking was still greater, but was offset by promptitude, intelligence, and ability to conquer obstacles. The in- experience of the cooks, which at the outset seemed to doom the work to failure, from an epicurean standpoint, is noteworthy in view of the exceptionally good culinary results obtained." The quantity of each dish prepared was sufficient to supply from three to six persons. The varieties of food treated were bread, baked potatoes, baked apples, beefsteak, macaroni, rice pudding, roast chicken, mutton chops, apple tapioca, escalloped potatoes, baked custard, baked haddock, roast beef, bread pudding, ham, gingerbread, mince pies, rolls, chowder, corn bread, apple dumpling, with foam sauce, baked halibut, grouse, and citron cake. Reference is made to the particularly fine flavor of cornbread and fish. Escalloped potatoes were successfully made from raw potatoes cooked slowly in milk. The cracking point of the animal fats was not ■reached except in the small oven, and a little difficulty in the browning is referred to. In conclusion Miss Talbot says : " The economy, cleanliness, and simplicity of the ovens has been amply demonstrated. They are certainly magnum in parvo, and, if it were not for the Yankee determination to have omnium in parvo, the claim might be made that they can do all the work that could be fairly demanded." Many of you will recall the half-hour's entertainment which I attempted to give you two or three years since at the house of a late valued friend and fellow member, when I came to the house clad in an eight-dollar suit, with my supper in a small cooking box, and showed how a man could live comfortably and be well nourished on an income of $200 per year. I was not myself entirely sure whether I was quite serious in the matter, and whether my cooker might not be a mere play- thing. Since then I have come to a more certain conclusion. I may sometime prepare, with the aid of Professor Atwater, a large number of scientific daily rations ample for a working-man, to cost from twenty- five cents each per day down to ten cents. At twenty cents an ample 348 ^^^ htdustrial Progress of the Nation. variety of nutritious food can be prepared in either one of these ovens by a single man or woman at as low a relative cost as for a large num- ber. The whole supply for the day can be cooked over the evening lamp, a part to be re-heated for breakfast and dinner on the next day, without losing its appetizing quality. In order to maintain my reputation as a man of figures, I will re- peat again the sum which might be saved to the people of the United States. The average expense of a working-man in full work is twenty- five cents per day for the materials of food ; the measure of waste at a moderate computation is twenty per cent., or five cents per day. This includes the waste of rich and poor alike ; of the first-class hotel and of the factory boarding-house. The consuming power of the United States at the present time is that of over fifty-two million adults, counting two children of ten or under as one adult, and the objective point of my work is to save five cents a day on fifty-two million, which would amount annually to about one billion dollars. (In order to save myself a part of the burden of correspondence on this subject, I may venture to state that circulars giving prices and direction for the use of the Aladdin Cooker and Oven can be had on application to Kenrick Brothers, Brookline, Mass.) A SINGLE TAX ON LAND A SINGLE TAX ON LAND. THIS proposition, which has been sustained with so much sincerity and ability by Mr. Henry George and his coadjutors, for the col- lection of all public revenue, both for national. State, and mu- nicipal purposes, by a single tax to be imposed upon the valuation of land, has attained a strong hold upon the minds of a considerable number of able and sensible men. Many of them are, however, per- sons who can hardly claim to have given much attention to the problem of taxation before this theory had been brought to their attention. This theory is apparently so simple, and would seem to be so effective in practice, that it appeals to the imagination, but it may not stand the test either of history or of logical analysis. This plan is not new ; it originated with the school of economists known as the Physiocrats of France, whose principal exponent was Quesnay, and whose theory in respect to land as the source of all value, and therefore a right subject for all taxation, was substantially brought into public notice by Turgot, the great finance minister of Louis XVI., whose fall preceded the French Revolution ; it opened the way for some of the final abuses of power which led up to that great event which has worked so much both of evil and of good to humanity. Turgot's theory, which Henry George now sustains in respect to land, continued to exert great influence after his fall, and greatly affected the legislation of the Republic, leading to some of the worst of the financial disasters of that period. Reference may be made to Leon Say's " Life of Turgot " and Blanqui's " History of Political Economy " for the records. The consideration of this theory of taxation has been rendered more difficult at the present time by the manner in which it has been presented as a cure for poverty. Doubtless poverty may be aggravated, or in some special cases it may be caused by a bad method of taxation, but he who expects poverty to be cured by the organization of Anti- Poverty Societies, coupled with a change in the method of taxation and a change in the conditional possession of land under the laws of the State, must inevitably be disappointed. It is very difficult to follow the somewhat vague conceptions and the tortuous reasoning of the supporters of the single-tax theory, and 351 352 The Industrial Progress of the Nation. they frequently object that what they intend to do is not comprehended. If they would present a legislative act for carrying the single tax into effect, these alleged misconceptions would disappear. Their prime object appears to be to force land into wider distribution by the weight of taxation, and at the same time to relieve the people from a part of the weight of taxation by putting all taxes upon land or upon what they call the site value of land. This sounds a little like adding to the bur- den in order to lighten the weight, but it may be admitted that some heavy loads can be borne when rightly distributed better than lighter loads can be when concentrated in the wrong place. If, however, all people possess all land under the new conditions of possession sug- gested by Mr. George and his coadjutors, then all people who possess the land must contribute their portion of all taxes. But taxes cannot be derived from land without work. Raw land may support a vagrant and sparse population of hunters or shepherds, but true civilization could have no existence until land began to be fenced in and held in possession, because the product of the soil necessary to subsistence is a product of work, and land must be fenced in and occupied in order that it can be worked, and must be permanently possessed in order that it may continue to be productively worked. Taxation means work ; the method of taxation is only a method of distributing the products of work. This work may be work of the head, of the hand, or of the machine, or of all combined. It is meas- ured when in the process of distribution in terms of money, but the money itself stands for work or is derived from work. Wages, profits, salaries, rents, and also taxes are alike derived from the annual product of the four seasons, constituting the result of a year's work of the whole community. In this respect it matters not where the tax may be imposed in the first instance, somebody must work in order that the products may be brought forth from the mine, the forest, the field, or the factory, of which the tax constitutes a part. The work of govern- ment is as much a part of the work of the community as any other. In this work men, women, and boys are employed, from the President of the nation to the page in the House of Congress, including all the officials in the custom-houses, courts, post-offices, and the like. These public servants must be supplied with shelter, food, and clothing, and in order to supply them others must work in the production of build- ings, grain, meat, fibres, and factories, from which the taxes are paid. In the city the mayor, the common council, the firemen, the police, and the women who scrub the floors of the public buildings must be sup- plied with shelter, food, and clothing, and those who pay the city taxes do the work which is necessary to furnish this supply. The main question at issue must therefore be limited to one principal point. At what point, on what product, in what place, on what subject, or on A Single Tax on Land. 353 what process of work, mental, mechanical, or manual, that can be taxed, ought the taxes to be placed in the first instance ? How can the taxes be imposed so that the money shall be secured with the least injurious effect upon the occupations of the people, and so that the burden of taxation shall be most equitably distributed among those who must do the work, mental, manual, or mechanical, from the product of which these taxes are. derived ? How shall taxes be assessed so as to be in proportion to the ability of those upon whom they fall in the first instance to pay them ? When this view of taxation as a mode of work is presented, a wide field is opened for the choice of subjects for taxation. As nearly as the figures of our national and State accounts enable us to make a computation, the sum of all our taxes — national, State, and municipal — comes to about six per cent, of the value of our annual product in a normal year, this annual product being valued at the point of ultimate consumption ; conversely, six per cent, of all our work, or about that percentage, is and must be devoted to the support of gov- ernment, since the value of the annual product is the measure in money of the work that has been done by the whole community of which the work of government is a part. It will doubtless be admitted by all competent persons that the taxes should be imposed so as not to impair the productive power of the community as a whole. In what does this productive power consist ? May it not be held that it is divided into three parts, representing dif- ferent directions of mental, mechanical, or manual force ? Does it not consist, _;?rj/, in mental capacity ; that is to say, in the capacity of those who by way of invention, by the application of science, or in some other way of applying the work of the head rather than the hand to the conduct of the work of society — save the com- munity a large part of the mechanical work and manual work which had been necessary, or which would otherwise be necessary were it not for the application of this mental factor in production ? Is not the mind of man the prime motor in all material production ? Does it not consist, second, in the direction or application of the natural or mechanical forces either in the primary, secondary, or sub- sequent processes of material production under the control of skilled workmen, tending to the saving of a great part of the manual work or labor previously required ? As the mind of man is the prime factor, is not skill the equally necessary secondary factor ? Is not the third application of force that of mere manual labor or work of the muscle rather than that of the mind to the primary and crude processes of production ? If these three phases of productive energy be considered in ratio to their relative effect upon the joint product, does it not become evident 23 354 ^^^^ Industrial Progress of the Nation. at once that those who occupy the third position or lowest plane, al- though most numerous, will be capable of producing the least quan- tity of exchangeable products in ratio to the quantity of work, labor, or time which each may devote to a specific branch of industry ? Is it not also evident that those who are in the second and third classes, or in the various gradations by which one class merges into the other, may obtain results or products of greater and greater value somewhat in inverse proportion to the mere manual or physical effort or to the time which each may devote to his respective branch of work ? Does it not follow that those Avho are capable of taking position in the higher planes may in a few hours' work produce vastly more than is required for their own subsistence, while those in the lowest plane may only be capable in long hours of work of producing enough for a bare subsist- ence ? If then, heavy taxes should be imposed upon those who occupy the lowest plane, taking from them by taxation a part of that meagre product which is necessary even to their bare subsistence, that system of taxation might reduce them from poverty to pauperism. On the other hand, if the same amount of taxation should be im- posed, in the first instance, upon those who are in the higher planes, all of whom produce much more than is necessary for their own subsist- ence, may not such taxes only take from them a small part of that which they can spare without in any way affecting their productive ability or diminishing their necessary consumption, either of their own products or what their own products can be exchanged for ? Does it not then follow that taxes should be imposed as nearly as may be in ratio to the productive capacity of those upon whom the taxes are assessed, sparing as much as possible those whose productive capacity barely suffices for their own support or taking from them by way of taxation only such products as are not necessary to subsistence but are more or less of voluntary use, such as whiskey, tobacco, and beer ? There is no charity in such a view of taxation ; it is consistent with the keenest business sagacity. The burden upon the members of the community who can pay and who must pay will be greatly increased if taxes are so imposed that those who have been poor but yet have been self-sustaining, should be forced to become paupers either by heavy taxes on the necessaries of life or on the land of which all must occupy a part. It should be remembered that there can be no great elasticity in that part of our taxation which is absolutely required to meet the necessary expenses of the government. It varies with the duties or functions imposed upon the government. I have said that our present taxes come to about six per cent, of the value of our entire product, but there is no absolute basis for this computation. In 1880, I think, the rate was considerably higher. There is, however, a certain sum, whatever it A Single Tax on Lmid. 355 may be, that must be devoted to the support of the government every year, even though the product of one year may vary very greatly from another. It has been very truly said that " there is nothing sure but death and taxes." Now if some persons produce much more than they can consume, while others produce barely enough, then it follows that if the assessment of the necessary sum of taxation is not put in the first instance upon those whose productive capacity is the greatest, then it must fall upon those whose productive capacity is the least : this view leads again to the expediency of putting the taxes where they can be most easily collected without injury to productive capacity ; that is, upon those classes who possess the greatest ptoductive capacity either in the possession or use of land ; in the possession or use of capital ; or in the mental power or skill which enables them to render large services for which they may receive large compensation. In this view of the matter, an income-tax would be the surest measure of the productive capacity either of the man himself, or of the land, capi- tal, or skill with which he may be endowed, consequently an income- tax might be the ideal tax, were it not for certain practical difificulties which forbid it being the chief source of revenue. A succession-tax — that is to say, a tax levied upon bequests of property — might also be one of the most feasible and judicious sources of revenue, and why such a tax has not been more deeply considered and more commonly adopted in this country, is one of the difficult questions to answer. On the other hand, may not a tax limited wholly to land valuation be as far removed from a tax assessed in proportion to the productive capacity of a community as can well be conceived ? Raw land of itself produces nothing more than might suffice for the support of a vagrant population of hunters or shepherds. The productive capacity of a man is neither measured by the land which he owns or occupies. It is measured by what he can do for other men better than they can do it for themselves, whether by the use of mind, muscle, machinery, or land, and by that measure his income will be greater or less. Neither is a man paid in proportion to the land occupied in his work, nor for the quantity of the physical effort which he puts into his work ; neither is he paid by others according to his own estimate of the service which he renders to them ; he is paid, or he earns income according to the estimate of those whom he serves, of the labor or work which he saves them from doing, which they would otherwise be obliged to do for themselves if they tried to serve themselves in the same way. A man's income is therefore measured by his capacity to save other jjeople a part of the struggle for existence, and since there is no compulsory ser- vice and no compulsory payment either of wages, profits, or rent, in this country, each man can be said in the long run to fix for himself the rate of his own wages, his own earnings, or his own rents, by the 356 The Industrial Progress of the Nation. amount of capacity or capital which he puts at the service of those who pay him for the use of his land, capital, head, or hands. If then, we could tax men exactly in proportion to their productive ability or capacity, we might reach and secure a share of the annual product of the community in an equitable manner, while at the same time taxing it at a point where the tax would limit further production or draw upon the necessary subsistence of the community in the least measure. The answer to this proposition by the advocates of the single-tax system may be, that a great many men are forced to devote a large share of their work, or to pay others a great deal of money without getting any adequate return from them, because some men own or control the land while others have none ; it being held by them that any payment of rent for land is not conditioned upon service. It is held that men who hold land under the present conditions of posses- sion do not earn the rent upon land, and that rent is paid simply because some men own or control the land while others have none ; therefore, it is held that rent may be something that is not rightly due or that is not equitably earned. At this point the difference begins in respect to the true source of production from land which must control the true science of taxation. It will be admitted that all material productions are derived in the first instance from the land, the forest or the mine, with the slight exception of products gathered from the sea. The sea is not divided or owned to any great extent, — only the waters near the shore. All are free to derive their food from the sea outside a narrow shore line, if they choose to do so. Land is, however, the main source of crude products ; but these crude products must be converted and re-con- verted and must be wholly changed from their primary form before they are ready for ultimate consumption. More value can be, and is, added to these crude products by those who do not work directly upon the land than by those who work directly upon it in the primary processes. Therefore land must be considered as of the same nature as all other instruments of production, effective only in ratio to the work put into or upon it. There is a fallacy even in attributing all crude products to land only. Land soon fails in its inherent properties or power of primary production and will in a very short term of years fail to sustain any considerable population. It will only yield a permanent product in ratio to what is put into it. What is put into it is capital and this cap- ital is applied with more or less labor. Capital in a material form is a product of past labor saved and converted to reproductive use by the service of those who do the present work. Land, labor, and capital must therefore of necessity cooperate in order that either miy be of A Single Tax on Land. 357 adequate service in the subsistence of mankind. Both land and capital are inert without the service of labor, and labor is also incapable of abundant product without capital or land. A tax upon land which might restrict its use or upon capital which might impair it in amount and render its service less effectual, would therefore ultimately fall most oppressively upon labor which cannot wait. In respect to rents it is admitted that the money that is derived from the sale of the crude products of the forest, the soil, and the mine, is divided among those who do the actual work and those who own or hold conditional possession of the soil, the forest, and the mine under existing laws. This share which those who possess the land now receive in the form of rent is what is aimed at by the advocates of the single-tax system upon the theory that private rent can be converted into public taxes. It is held by them that if this rent could be secured by taxation under the new system of the conditional possession of land proposed by Mr. George and his associates, then this rent would suffice to meet all the expenses of government, and that those who now subsist upon these rents would then be compelled to go to work for their living, if they were not already working. That is to say, thqy hold that if rents or rental value could be diverted from private to public use, the burden of tax- ation which would become a substitute for the burden of rent would be so much derived directly from land and that it could not be distrib- uted ; therefore it is affirmed that those who now subsist upon rent would be obliged to work, and those who now pay the rent and taxes would save one or the other, and would have more leisure and more to spend upon themselves for other purposes. When the subject is presented in this way the main questions are at once brought out : 1st. Does land produce any product available for rent or taxes without work ? 2d. Are land and labor in the limited sense in which the word labor is commonly used to designate the manual, mechanical work of the person who applies physical force or manual labor directly upon the land, the only factors in the primary production of the crude prod- ucts of the soil ? Or, in other words, if all land were either held in common or in severalty, free from private possession and free from rent but subject to a single tax, would labor when in possession of land but without capital be capable of sustaining a community? The advocates of the single-tax system, and Mr. George himself would immediately answer this question in the negative. They admit that the possession of land and the application of capital to it by private persons under certain conditions established by law, are an absolute necessity to abundant production, and that both capital and labor must be 358 The Industrial Progress of the Nation. applied to land and are therefore necessary even to the collection of the single tax which may be put upon land. What is the limit of the production from land unless capital is applied to it ? It needs but a moment's reflection to prove that land and labor without capi- tal would be wholly incapable of sustaining a civilized community ; it matters not whether the capital be only a rude hoe or a pointed stick with a handle to it, to be used for a plow ; or a steam plow and a self-binding reaper. Some kind of capital must be placed at the service of man, or else the laborer himself could barely subsist even on the best land. Has it not been proved conclusively by experience that in proportion to the quantity and effectiveness of the capital applied to land is the quantity of labor diminished and the quantity of product increased ? Is it not also true that as the quantity of crude products derived from the soil is increased by the application of capital and the adoption of improved machinery, the more abundant produc- tion gives the workman of the present day a wider opportunity and a better subsistence in the struggle for existence than he ever had before ? Again, if land without capital is almost useless and incapable of production, then a tax on productive land is undoubtedly a tax on the capital and labor applied to it. The contention of Henry George and his coadjutors is, that since production comes in the first instance from land, all people should have some share in all land ; but since land and labor by themselves are incapable of abundant production without capital, does it not follow of necessity that all who have a share in all land must of necessity also have some share in all capital ? Otherwise of what use would the land be to them ? What is this but Socialism or Communism if brought into effect by legislation ? Conversely, does it not follow that if private property in capital or in things already produced from the soil, the mine or the forest, is admitted to be necessary to the use of land, then private property in land under similar conditions must also be admitted to be necessary to the use of capital upon it ; first, in order that there may be an abun- dant product, yielding a surplus to be saved for conversion into capital, and second, in order that this capital may be applied to reproductive purposes upon the land ? The institution of private property in land and things has been developed not only because it is necessary to the subsistence of those who own the land and capital, but in order to make it possible that the laborer should exist at all. The term own is relative ; there is no abso- lute private property or ownership either in land or capital ; both are held in conditional possession subject to all that is implied in the power of the State to exert its right of emirfent domain. All that A Single Tax on Land. 359 Henry George and his associates have as yet proposed is a change in the terms of the conditional possession of land ; they have not sug- gested Communism or Socialism, although their theory might lead to that conclusion if carried into effect. If there is any truth in the considerations which have been pre- sented, the proposal to secure alLpublic revenues from a single tax on land does not rest upon any abstract principle of right. In fact it would be difficult to prove that any fundamental principle of taxation has yet been established which can be said to form part of a science which can be applied in all times and all places, and to all conditions alike. In the present state of our knowledge it is almost a necessity that the method of taxation should be treated almost wholly as a question of expediency, and on general principles it is not expedient to put a tax where it will obstruct production. It is therefore in the first place expedient to consider the conditions under which capital may be voluntarily applied to land, since no com- pulsion is possible in the nature of the case. With respect to farm land, no one will improve, fence, or drain it, or erect farm buildings, unless he can obtain permanent possession under some sort of title of an individual kind, such as would warrant him in exerting his labor and expending his capital with a view to future results. What is the present cause of the poverty of the agricultural laborer in Great Britain and Ireland except that he has been debarred from the possession of land under permanent conditions, either by custom or by a bad system of land tenure ? Again, will any man construct an expensive building upon a city lot or a costly factory by the side of a stream, unless he can be sure of the permanent possession of the land on which he invests his capital ? If land is not improved, that is, if capital is not applied to its improve- ment, its quality cannot be maintained and erelong it will cease to yield any adequate return to the labor which is put upon it. When it ceases to yield any adequate product will it not then cease to bear any valuation upon which the taxes can be assessed ? Could it then be assessed at a rental value or a site value, or could the taxes be col- lected if the product failed to yield any thing above a meagre subsistence to the squatters upon it ? Does it not then follow that land is a mere instrument or tool of production, and that it cannot be made a possible source of rent or taxes, except in proportion, not to the labor or capital, but to the labor and capital which may be applied to its culti- vation and use ? A city lot possesses even less inherent value than a farm ; a farm may possibly yield something for the subsistence of labor even without capital, but a city lot from which the loam has been taken and which is hardly big enough to feed a rabbit upon if planted in clover, can 360 The hidustrial Prog7'ess of the Nation. produce neither rent, profit, nor income, except in proportion to the capital which may be expended upon it. True, both farms and city lots may be the subject of purchase or sale, but the price that is paid is not paid for any permanent value or any inherent power in the land simply as land to yield either rent or taxes ; it is paid for the choice of position. The capitalist will pay a high price for a city lot in order to have an opportunity to put expensive buildings upon it which may be used as instrumentalities either of production or distribution. The capitalist who pays the highest price for the choice of the highest-priced city lots does so because at that place the commu- nity can be served at the least cost — for the reason that these lots are in the most convenient situation for the community to reach in order to buy their goods. The price is paid for the choice of land. It will be alleged in rejoinder that the high price which may be paid for the choice of position is due to the growth of society, and that any gain which one may make by holding these lots until society settles around them is the so-called " unearned increment." It is admitted that it sometimes happens that a man who holds a vacant lot for a long period may secure a large profit, and the profit which he derives is not due to any work which he himself puts into the lot, but to the growth of society about it. This " unearned increment " has been greatly exaggerated, and is very largely a matter of the imagination ; but whether it is or not, it is evident that if the possessor under the present condition of our laws has no right to any sum this " unearned incre- ment " may produce, then he has no right to seacre a profit on any thing due to the lapse of time. There is no difference between this " un- earned increment " upon a city lot or farm and the " unearned incre- ment " on a share of railroad or of factory stock, or a ton of wheat, or any other product of the land. A man who buys a share in an unfin- ished railway, and keeps it until the growth of towns along the line raises the price of the stock, has as much right to that advance in price, and no more, than the man who had the foresight to buy a city lot at the risk that even interest and the present taxes might deprive him of any ultimate profit. Men often build factories in advance of the de- mand ; presently the growth of the population increases the demand for the fabrics ; then follows a rise in the price, due either to greater consumption or to the increase of population. Has he no right to the increased value of the goods made in the factory, because it is due to the increase in population ? Or a man buys at a low price a lot of wheat, foreseeing or hoping to get a higher price in the future ; if he is wrong there is an unrequited dccref?ie?it which society has not yet proposed to take upon itself ; if he is right in his exercise of his own judgment and foresight he gains ; to whom does that gain be- long ? A Single Tax on Land. 361 If, then, land is like every other tool or instrument of production, in being capable of yielding product only in ratio to the labor and cap- ital applied to it, it must be considered like any other instrument of production as only one of the sources of the aiuiual product to which value is imparted in the process of exchange by the joint work of all who take any part either in production or distribution, whether they be laborers or capitalists. If this be admitted, it then becomes expedient to explore the sub- ject a little further and to find out what part of the ultimate value of all products has been derived from land considered as the source of primary production. Of course it will be admitted that there can be no material work done except by men who plant their feet upon the soil somewhere. Every man must have a position on the soil some- where, whereon to rest the lever with which he moves the natural forces towards the subsistence of man ; but the contribution of the different classes of men to the ultimate value of the annual product at the point of final consumption may almost be held to be in inverse proportion to the quantity of land occupied. For instance, it requires from six to eight thousand acres of land and about one thousand laborers to pro- duce about five thousand bales of cotton in a season, at the present meagre proportion of product per hand and per acre. But that five thousand bales of cotton may be doubled or trebled in value, and brought from the crude condition in which it is unfit for use into the finished fabric suitable for clothing, in a factory which covers but a fraction of an acre of land. • Again, a man may be occupying an attic ten feet square in the upper story of a city building, by whose work the future capacity of that fac- tory may be doubled. It is not many years since I paid a visit to such a man, working in a miserable attic in a cheap city building, by whose invention the productive capacity of every boot-maker in New Eng- land was more than doubled. He was the first inventor of sewing- machines in which a waxed thread could be used. A part of what the government needs, and must secure by way of taxation, may be six per cent, of the cotton fabrics made in the factory, such fabrics to be used in clothing the government employes. The science of taxation will therefore consist either in putting a tax upon the field where the cotton is raised or on the site where the factory is built, /. ^., on the land applied to cotton and cotton fabrics. This is the policy advocated by Mr. George and his coadjutors ; otherwise a tax may be put upon the goods delivered from the factory, or on the cotton in the bale, or on the warehouses where the goods are stored or from whence they are distributed, or on the railways that move both cot- ton and goods, or upon the property and incomes of the owners of field and factory and railway. Another way to secure money for the govern- 362 The Industrial Pi'ogress of the JVation. ment is to put up the taxes upon some other products which are con- sumed by those who raise cotton or make cotton goods, such as whiskey, sugar, tobacco, beer, and silks, and fancy goods, and other articles, all of which the workmen upon the cotton plantations and the workmen in the factories may or must consume. Another way to secure the neces- sary revenue for the government is to put a tax for local purposes upon the value of the cotton plantation, upon the value of the cotton factory, and upon the value of the warehouses where the products are distrib- uted, according to their respective place and value. Which of these taxes would be most likely to obstruct the production of the cotton farm or of the cotton factory ? Therein lies the whole question of equitable taxation. At what point and in what place can the national and State governments secure from the cotton industry, or from any other branch of production, that part of the supply of cotton goods, food, or other products that the employes of the government must have in order that they may be subsisted ? When viewed in this light it becomes apparent that the productive capacity of those who work upon the cotton field barely suffices for their own support, while the produc- tive capacity of those who own or operate the railways by which the cotton bale is moved or produced from the field to the factory, suffices for the support of the railway owners, railway employes, and also, when imobstructed by meddlesome statutes, may or does yield a large sur- plus over, which may rightly be subjected to a tax. It may appear that the only thing that can be taken from the laborers on the cotton fields, without injury to their productive capacity, may be a part of the whiskey and tobacco which they consume ; it may be that those who work in the factory barely earn a subsistence, and that what can best be spared by them would be a part of the silk, ribbons, and fancy goods, or the whiskey, beer, and tobacco which they consume, if by taxation these things cost more, and are therefore consumed less. Lastly, it may appear that a well-conducted factory in which large capital and a small quantity of labor are directed towards the produc- tion or conversion of cotton into cotton fabrics, or of wheat into flour, or of iron and steel into machinery, — may yield subsistence to all the operatives and also furnish an income for the owners more than sufficient for their subsistence. Therefore that property in the cotton factory or in the machine-shop or warehouse might, as a whole, and not simply the land only, be a just and expedient subject for local taxation. It may be assumed that since the consumption of whiskey, beer, and tobacco in this country is fully equal to the entire sum of all taxes, both national. State, and municipal, it may be both just and expedient to tax these articles which are of voluntary and not necessary use, to the fullest extent, since both workmen, artisans, landlords and tenants, clerks, and owners of capital, will all be as capable of productive A Single Tax on Land. 363 energy and even more capable of effective service, the less these articles are consumed by them. If then, the productive capacity of man is, and may be in inverse proportion to the quantity of land held or occupied by him, does it not follow that while land may be an expedient subject for a part of the taxation it may not be rightly subjected to «// taxes under the single- tax system, without the danger of very grave injury to the whole people ? Moreover, if land were thus made subject to a single tax sufficient to meet the expenditures, it might be a great injustice to col- lect this tax from those who hold land according to its present value, and if such an attempt were made it would probably limit or reduce the conditional possession of the land to a few large capitalists rather than to bring about a wider distribution of land among the less prosperous classes. Again, if the single-tax system is sound in principle, it should of course be made the single source of all public revenue, — including both national, State, and municipal taxes, — and it should then be applied to all land, farm land as well as city lots. There can be no variation in the application of a principle of taxation, but when a method of taxa- tion is treated upon the ground of expediency, a different rule perhaps might be applied to farm land and city property ; into that branch of the subject there is no reason to enter in this treatise. If the advocates of the single-tax system had been farmers, holding the average amount of land and working their holdings year by year in order to gain a subsistence for their families and to sell a sufficient amount of the product of their farms to enable them to buy clothing, groceries, and to pay even their present local taxes, the promoters of this theory would more fully comprehend than they do now how diffi- cult it is for the average farmer to set aside even money enough to pay the present taxes, which constitute only a part of the revenues re- quired by the State, county or town, and which do not include any con- tribution whatever to the equal need of the national government. They might then realize that the source from which this money is derived is not the land itself ; they would then become aware that the product of the land, especially in Massachusetts, is not due to any in- herent fertility in the soil, but is due in part to the capital put into the soil in fertilizers ; in part to the capital applied to the soil in machinery and tools, but mainly to the very hard work of the head and labor of the hands which is put into the processes of production by the farmer and his men who drive the plows and direct the motions of the farming tools and machinery, to say nothing of his wife and daughters who do the work of the kitchen or the dairy and supervise the hen-yards. The advocates of the single-tax system might then become aware in a prac- tical way, if they never knew it before, that land by itself has no power 364 The Industrial Progress of the Nation, of production and no power of subsisting any one except hunters or Digger Indians who live upon wild roots. They might then discover that a tax on land must be paid by work, and that it would be only a tax on work disguised under a specious fallacy. Let us suppose, however, that the single-tax system had been adopted, and that the farmer must pay by a single tax on land not only the taxes now assessed upon his farm and buildings, which now in part support the local government, but also all the rest of the taxes for the support of the State and municipal government, such as the taxes that are now assessed upon the railways, upon banks, insurance companies, and all other kinds of property — all of these must then be paid by the land. The farmer, having then earned this sum in addition to his pre- sent taxes, and set aside enough for the county, State, or town, will then find out that the requisitions of the national government are as great as those of the States and towns. He may then discover that although the expenses of the national government might be somewhat diminished yet even when reduced to the lowest terms the amount of the national taxes is equal to the local taxes. The national government now re- quires for the civil department : ist, legislative, executive, judicial, and foreign expenditures, and for the construction and maintenance of public works, not less than $6 r, 000,000 each year ; 2d, for the naval establishment, including the construction of a navy, even of a very moderate and limited sort, not less than $20,000,000 ; 3d, for the mili- tary establishment, including very moderate provision for fortifications and public works of that sort, not less than $39,000,000 ; 4th, for the interest on the public debt, at the present time at least, $40,000,000, therefore omitting pensions and the sinking fund (and assuming what is the fact that all miscellaneous expenses are met from miscellaneous permanent receipts, such as the sale of the public lands, receipts from , consular fees, and the like), yet the necessary revenues required by the national government to meet the ordinary expenses reduced to the low- est terms would not be less than $160,000,000. In addition to this, until the public debt is all paid, the requirements of the existing law in respect to the sinking fund increase rather than diminish, calling for not less than $50,000,000, while the sum required for pensions is over $80,000,- 000 a year ; for current annual pensions, about $50,000,000 ; for ar- rears, about $30,000,000 ; the national revenue absolutely required therefore amounts to about $290,000,000. Therefore the annual con- tribution of the people to the support of the government and to the debt and pensions must.be at least equal to the sum now assessed upon property for the support of State and municipal corporations which does not exceed that sum. Exact comparison cannot be made, because the data of local taxation are not as perfect as they might be. This abso- lutely necessary expenditure of the national government is now met in A Single Tax on Land. 365 considerable part by duties and internal taxes which are assessed upon articles of more or less voluntary use, so that any man who does not choose to contribute may, by giving up the consumption of a few things which he can do without (and perhaps be the better fordoing so), put his part of the national expenses upon those who choose to pay for it. At the present rate of income, the national government secures year by year a little over $100,000,000 from intoxicants — that is from the taxes or duties upon distilled spirits, wines, and beer ; from tobacco, $40,000,000 ; from sugar and molasses, $52,000,000 ; from manufactures of silk, $16,000,000 ; from fine linens, over $5,000,000 ; from laces, em- broideries, and fine fabrics, which are of the nature of luxuries rather than necessities, made of cotton and worsted, from $17,000,000 to $20- 000,000 ; from furs, fancy goods, fruits, sardines, and other articles of like kind, about $20,000,000. The sum of the national taxes imposed upon articles which may be considered luxuries, or articles of voluntary use rather than necessities, comes to $250,000,000, which contribution, is more than sufficient to pay all the necessary expenses of the governr- ment and the sinking-fund and nearly all the current annual pensions, the remainder of the pensions being collected from other duties than those enumerated above. When the debt and pensions are paid, the government will be able to spare all the taxes now derived from to- bacco and sugar, and these war taxes may rightly be abated when the financial burden of the war is lifted by the payment of the debt and pensions, if not before. Now if the question were put to the farmer whether he would prefer to be assessed by a single tax upon his land, or to contribute his proportion by a tax on his glass of whiskey or beer, even on his sugar and molasses, or by way of the laces and ribbons which his wife and daughters buy for their Sunday clothes and bonnets, it is probable that he would not hesitate long in which way to make his contribution to the national expenses. In fact, there are very sound reasons why it is expedient that the national revenue should be in some part collected by indirect taxation, and should be imposed mainly upon articles of com- mon even though not of necessary use, so that the ratio of the national taxes should be more nearly in proportion to the population than to the valuation on property. This system of indirect national taxation, which may be paid about /