GIFT OF 
 
 
 is^t 
 
^^ 
 
 N ERRONEOUS 
 VIEW-POINT 
 
 BY 
 
 JOHN E. BENNETT, Esq. 
 
 ,/^> 
 
 ^ 
 
 f^V- 
 
 
 I SEE IT NOW!" 
 
 — Reprinted from Literary Digest. 
 
 above cartoon fairly presents the prevailing 
 
 fs of the country upon effective remedies for the 
 
 [trial unrest, as well as the acquiescence of the 
 
 jess world in those views, to which acquiescence it 
 
 )een brought by the pressure of popular opinion 
 
 (ts own ignorance of what the true remedies are. 
 
 and several of the proposals are entirely useless 
 
 ledies, and the application to practice of all save 
 
 that of Federal Emplojmient Bureaus, not only 
 
 ft help the condition, but make it worse; and are 
 
 [direction precisely opposite to the true course, 
 
 is simply individual freedom. 
 
 Issued by 
 [SINESS MEN'S ECONOMIC ASSOCIATION 
 
WRITINGS OF JOHN E. BENNETT 
 
 PAMPHLETS 
 
 OUR NATIONAL TENDENCY AND ITS GOAL 
 
 Being a discussion of the Political and Industrial direction 
 of the United States under the influence of prevailing eco- 
 nomic forces, and statement of the causes thereof, and the 
 means to avert the conclusion to which those forces are pro- 
 ceeding. 
 
 Together with an Address before the Chinese 
 Students' Association of America at its Con- 
 vention held in San Francisco in January, 1914, 
 
 upon 
 
 THE STUDENT IN ORIENTAL IMMIGRATION 
 
 Considering the eflfect upon China and Japan of the Policy 
 of the United States in shutting off migration of the Orient 
 with the West, the real cause that moves industrial migration, 
 and the condition that confronts Oriental Students seeking 
 education in the United States, by reason of these influences. 
 32 pp. 
 
 "JAPAN'S MESSAGE TO AMERICA " 
 (A Reply) 
 Considering the impelling cause which moves the Japanese 
 nation to desire the good will of the American people; the 
 necessity to Japan of free intercourse with the civilization 
 of the West, now shut off by immigration exclusion; the 
 calamity which inevitably must befall that nation through a 
 continuance of the isloatlon thrust upon her by this policy. 
 The doctrine of exclusion shown to rest upon a mistaken 
 belief regarding the effect of labor immigration upon wages 
 of intra-country workmen; the popular opinion being that such 
 immigration lowers wages, whereas, in truth, it raises wages 
 and increases general prosperity. 
 33 pp. 
 
 THE INDUSTRIAL UNREST 
 Noting the rise and forms of human government. The move- 
 ment for expunging the Constitution of the United States, 
 with the cause and processes of that movement. The passing 
 of the American Commonwealth and the evolution of the cen- 
 tralized State in its stead; with observation of the several 
 forces responsible therefor. Remarking the various expedients 
 for relief of the working classes, among which, the California 
 eight-hour labor initiatives, and sundry others. The basic 
 errors of such proposals, and the hopelessness of benefit to the 
 working people through pursuit of their direction. Together 
 with consideration of the true cause of prevailing wrong con- 
 ditions within the nation, and the disaster in which these must 
 culminate unless they be intelligently and courageously cor- 
 rected. 
 
 70 pp. 
 
 THE CALIFORNIA MANUFACTURER AND EASTERN 
 COMPETITION 
 The natural evolntion of the State from an agricultural into 
 a manufacturing community shown to be held in abeyance by 
 artificial wage rates and conditions imposed upon employers 
 by unions. Helplessness of the California manufacturer in the 
 field of competition through these influences, and the inevitable 
 passing of the important manufacturing industries of the State 
 unless the employer shall assert control of his establishment 
 and place his labor on a basis of free industry. Artificially 
 high wages shown to be of no benefit to the laborer receiving 
 them, while the consequent narrowing of the industrial field 
 suppresses business and produces ever increasing numbers of 
 idle workmen. The remedy and proper line of operation pre- 
 sented, and the vast oportunity at the hands of the manu- 
 facturer in supplyipLg the local and over-'4ea trade, considered. 
 35 HI), r . * . 
 
 Copies of the -witlifn pigiplUets, or booklets may be had by 
 
 • - adHresstng • • *• " 
 
 BUSINESS MEN'S ECONOMIC ASSOCIATION 
 
 1310 Humboldt Bank Building 
 
 San Francisco, Cal. 
 
z 
 An Erroneous Viewpoint 
 
 By JOHN E. BENNETT. 
 
 Near the outskirts of San Francisco there is a barri- 
 cade of boards behind which is encamped some hundreds 
 or thousands of men who comprise the "out of work 
 army." They are being fed by public charity. The 
 Board of Supervisors have made a large appropriation 
 for their sustenance, while the Mayor has issued a proc- 
 lamation and appointed a day asking all citizens there- 
 upon to donate one dollar, toward provisioning these 
 people. Private charity last winter, and in the years 
 prior, exhausted itself in sustaining these same persons, 
 less their added numbers of today, and it is manifest 
 that the problem has passed beyond the scope of private 
 alms ; the State in its political subdivisions rnust come 
 forward and use public funds to cope with a condition 
 which none understand ; for these men are not sick, or 
 criminal, they are merely occupationally idle; they each 
 and all s.iy they want work ; and industrial initiative, 
 that is, citizen initiative, is not sufficient to bring for- 
 ward business which will call them into employment. 
 Citizen initiative, or in other words, that initiative which 
 arises in the tield of the free scope and action of the 
 individual, this failing to generate industry which would 
 give them jobs, political initiative must be wheeled into 
 the clearing to do for them what the people generally 
 have failed to do. Hence the Supervisors and the Mayor 
 touch heads in studying out plans to "make work" for 
 these workless. Piles are moved from one spot and 
 made in another; holes are dug and filled. There are 
 always things to be done about a city ; but work that is 
 placed where the achievement is not the object of the 
 effort, but the purpose is merely to keep one stirring to 
 provide a pretext for giving him pay — that order of 
 work is likely to be wasteful. 
 
 Yonder in France, in the valley of the Aisne, there is 
 another barricade; this is not of boards, but of earth, 
 and behind it there are also some thousands of men, 
 likewise out of work, and in the pay of the State. They 
 are living in burrows in the earth like the cave men at 
 the dawn of nature ; and what they are doing is just that 
 thing which the cave men did — they are trying to de- 
 stroy all men within their reach who are not of their 
 particular group or tribe. Here, then, we have it that 
 these men, being consumers and not producers, depend- 
 ents of the State and in its service, are exerting them- 
 selves in the operations of destruction. The distance of 
 space which separates the two encampments, the vari- 
 ance in nationalities and environment, would seem to 
 dissever the respective assemblages of any possible rela- 
 tion which they might bear as common members of the 
 human family. But in the region of thought we are 
 pursuing, space and nationality are without significance. 
 We are dealing with the domain of economics, and in its 
 
 329^35 
 
coiiuiui . ii..,i \. <_ >..ai. >tv lijat both bodies of men 
 are the offspring of the same force. That between the 
 industrial men who, working on the building across the 
 way, are exerting their efforts in the processes of con- 
 struction, the idle multitude encamped in sloth and 
 misery who have ceased to be constructive, and are 
 merely negligible with their status feathering toward 
 destruction in that they consume and do not produce, to 
 the men in the pits who have ceased construction and 
 passed from consumers merely to the active agents of 
 destruction — that between and connecting all and each 
 of these there is the one attribute, they severally are 
 segments of society, and their status respectively is of 
 social phenomena. 
 
 As the highest natural law, aside from that of man 
 holding himself in existence, is sennce, and as service is 
 essentially the quality which makes it possible for men 
 to exist in society, it would seem that any influence 
 which specialized and tolled off a large number of the 
 people, whose segregation deeply affected the whole of 
 society, might have something to do with service; and 
 as the principal and real service of man is that through 
 which he renders benefit and not harm to his fellow, 
 we should in such analysis look at industry, which 
 embodies most of the service of man, to see if the 
 phenomenon we have noted bears any relation to' this 
 realm of human activity. Unquestionably the idle men 
 have something to do with industry, in that they have 
 been thrust out of industry; but the relation of the 
 men in the trenches to industry is not so apparent; 
 nevertheless we shall see that they are quite as inti- 
 mately a part of the industrial question as the men on 
 the sand lot, or the men at work on the building. 
 
 And when we consider this region of industry, what 
 concerning it today do we note as its most striking 
 quality? Manifest^ it is its rampant state of inhar- 
 mony; it is not working in its coordinate parts smoothly 
 and to achieving its results in the natural way, that is, 
 attaining its ends with the expenditure of least effort. 
 It is in a condition of stress, in a state of tension ; it is 
 overwrought, full of jars ; it abounds in antagonisms, in 
 hatreds, in classism; it is like a band of men rushing 
 on under a leader in pursuit of quarry, capturing it, 
 stopping and quarreling over its distribution, falling 
 upon and destroying each other, squeezing out and driv- 
 ing off a number because there are too many for the 
 portions to go round, then gathering together and 
 plunging forward again upon the next quest. Manifestly 
 such a mob is not united on any basis of natural law. 
 It is a multitude, large enough, indeed, to comprise an 
 army, but lacking in an army's organization. By virtue 
 of its organization an army moves, strikes and has its 
 being; instantly it becomes disorganized it loses its 
 efficiency, it ceases of avail, it is a mere aggregate of 
 helpless units, unstable and without restraint, howling, 
 shrieking and rolling on to destruction or dispersion. 
 And when you examine an army you find it built in 
 strict accord with natural law. It is a definite multi- 
 plication of units into companies, into batallions, into 
 regiments, into brigades, into divisions, into corps. The 
 infantry is not cavalry, and the cavalry is not artillery. 
 There is the engineering, the commissary, the sanitary, 
 the hospital corps. Ever>' man knows his place, knows 
 the men from whom he takes orders, and these know 
 and understand those who are subject to them. An 
 
order given by the head flies in a moment through all 
 parts and brings the entire aggregate into action. The 
 thing is schemed to effect instant coordination, immedi- 
 ate concentration upon a single aim. You can draw the 
 entire arrangement symmetrically upon paper. With 
 compass and rule you can create the establishment by 
 chart so that all you have later to do is to fill it in 
 with men and munitions. Can anyone chart a mob? 
 And yet when we come to deal with this great matter 
 of industrialism, to analyze the structure of society, and 
 to show that the cause of the industrial unrest is that 
 the institution does not square with natural law, to show 
 that the places where it is obviously weak are where the 
 law as revealed by economic reasoning has not been 
 regarded, and present the entire edifice as with lines and 
 figures, we hear cries of "beautiful theory, but it won't 
 'work in practice'!" What is that roll which your archi- 
 tect has in his hand, and for which you have paid five 
 thousand dollars? A plan? throw it away, it is nothing 
 but theory. When you go to build your house just pile 
 brick on brick and nail wood on wood, and put it up 
 according to your notion of things, or a clipping out of 
 a newspaper and it will stand there all right, and it will 
 be rentable enough ; yes, and on the morning of the first 
 day or the day after it will be about your ears, with all 
 the howls and execrations of a G)lorado, a West Vir- 
 ginia, a Lawrence, Massachusetts, or a thousand and one 
 spots over the nation where such houses are built. Not 
 alone does the architect figure his strains and scale his 
 measurements, but the builder places piece by piece upon 
 the structure adjusted with plumb bob. tested by spirit 
 level, tried by square ; and when it is finished it is up- 
 right ; it is horizontal; it is symmetrical; it is on a firm 
 foundation ; it is braced and trussed and supported ; it 
 has been built according to plans and specifications 
 created and elaborated in conformity with the canons of 
 natural law, in the architect's office. 
 
 When we come, however, as I remark, to this great 
 construction, the organization of industrialism which is 
 essentially the organization of society, so it shall com- 
 prise an edifice that will stand, or a machine that will 
 run smoothly and noiselessly in its several parts to the 
 turning out of its results, plans are not wanted and are 
 not_ used. The thing bucks and kicks and flies apart 
 killing and wounding its operatives with its fragments, 
 and yet he who unrolls a plan for its synchronous, har- 
 monious and coordinate action, excites few onlookers. 
 "These things adjust themselves." "We're too busy, 
 don't you know ; come around some other time." 
 
 Meanwhile public opinion educates itself; not accord- 
 ing to natural law. but with an arm full of brick and its 
 notion of things. Government Commissions follow each 
 other as birds spring to the open, flying hither and 
 thither to find out what the matter is. They call to ex- 
 plain various notable men. Mr. Rockefeller. Mr. Car- 
 negie, Mr. Morgan, and the rest. "What is the remedy 
 for the industrial unrest?" Opinions come forth, "thick 
 as blackberries." Certain of them are so oft repeated 
 that they are accepted by the public as true. We have 
 a summary and expression of these in the cartoon at the 
 head of this article ; and as these have a wide bearing 
 throughout the nation we shall, in seriatim, consider 
 them here. 
 
 THE TAX ON FORTUNES. 
 
 It is certain that every one of these prescriptions as a 
 remedy for the industrial unrest is utterly empirical and 
 
fallacious. We have practically all of them in operation 
 now, and their only result has been to intensify the 
 condition and in no sense to relieve it. The tax on 
 fortunes we have in the jncome tax law, the confiscation 
 reaching as high as seven per cent of the total income 
 annually. From this tax there is for the corporations 
 no exemption. We have it also in the super death dues, 
 being graduated taxes on estates, increasing as the sum 
 enlarges. The avowed purpose of these levies is not to 
 raise revenue, but they are aimed at discouraging the 
 accumulation of wealth. The laws are enacted upon the 
 hypothesis that society is injured by the accretion and 
 existence of large fortunes, notwithstanding that those 
 large fortunes are all invested in enterprises giving em- 
 ployment to commonwealths of men. That any one who 
 during a lifetime can acquire through business a hun- 
 dred or five hundred million dollars, where another man 
 working in his shop cannot by the greatest economies 
 accumulate ten cents, but dies in debt — that this sort of 
 thing is outrageous, and must be done away with by 
 moving against the millionaire quite like we put out of 
 existence the old state banks, viz. : taxing him to the 
 limit every time he thrusts his hand across the counter. 
 No legislation could be more foolish, few attempts at 
 legislation cduld be more harmful to the ver>' people 
 whom the mistaken legislaturemen think they are help- 
 ing by bringing it into existence. As I have shown in 
 my Tendency and I'nrest pamphlets, all that the mil- 
 lionaire can get out of society is what he eats and wears, 
 and his shelter and transportation, and this at most is 
 little. He is really a force creating wealth through his 
 guidance, bringing into existence opportunities for other 
 business men, making jobs for laborers which would not 
 exist but for his eflForts, The wealth he is acquiring 
 simply increases his powers to render more service to 
 society. A Rockefeller in possesion of a hundred mil- 
 lions may be a tremendous power for the creation of 
 new industry which will call into activity hundreds of 
 thousands of men, which would raise other thousands 
 from small jobs to large jobs, from places where they 
 could render slight service to positions in which they 
 could render large service, while the material wealth 
 he would force into existence, the oil, the iron, the rail- 
 roads and else, would enrich millions. An altogether 
 mistaken view exists in this country regarding wealth 
 and men of wealth. It is not hurtful but highly to the 
 advantage of the people generally that great wealth 
 should exist in individual hands. So long as monopoly is 
 crushed, so that great wealth cannot be made a force to 
 prevent other men from exercising free scope in their 
 several operations, there is nothing to fear, and monopo- 
 lies exist solely by reason of law; the possession of 
 monev alone capnot effect monopoly. To men of great 
 executive abilities, large wealth is a necessity required 
 to make their powers effective for good, without the use 
 of which society could not benefit by their exertions, for 
 the/ would there be no more useful than anyone else. 
 
 Where then is the sense in curbing the exertions of 
 men of genius by curtailing through law their possession 
 of that thing which in their hands is their effective tool 
 and implement, namely wealth ? I have a business and 
 hire ten men. From the services of each of these men 
 I tnake a daily profit of ten cents, from the entire one 
 dollar. W^ould anyone say that I was robbing these men 
 of the products of their hard-earned toil when my opera- 
 tions, consisting of administering the establishment 
 
which employs them, results, after payment of rent, in- 
 terest, material, and overhead, a return to myself of ten 
 cents per man? Now let me enlarge that establishment 
 until I build great works, transform enormous quantities 
 of materials, conduct vast shipping, distribute products 
 throughout the nation and over the world and I still 
 profit ten cents per man per day; but instead of employ- 
 ing ten men, I have through my genius and application 
 magnified my establishment to employ a million men a 
 day and, lo ! my income every day is a hundred thousand 
 dollars ; in a year thirty-six million dollars ; in ten years 
 three hundred and sixty million dollars, and in twenty 
 years seven hundred and twenty millions of dollars! 
 When straightway I am denounced as a robber who has 
 oppressed my laborers, which laborers have not gotten 
 their share of the product which they have made in my 
 shops, wherefor I am so rich and they are so poor, and 
 this disparity of fortunes in- society is not healthy for the 
 common weal and cannot be permitted. Then come 
 forth schemes to curtail my activities, to prevent repeti- 
 tion by others of such things as I have done ; in other 
 words, to kill and destroy private initiative which when 
 lessened there follows the out-of-work mass whom to 
 employ, initiative by the State must be invoked. It be- 
 comes the policy of the State to approve my energies so 
 long as I displayed little capacity and held my works 
 to a ten-man basis ; but when, by the illumination of the 
 mind, and by abounding energy I had magnified and 
 glorified the industry, brought into the world prodigious 
 wealth which I had dispensed to the comfort and happi- 
 ness of many millions, when I had become an engine 
 for the lifting of civilization to a higher plane, and was 
 making my influence felt for good the world around, 
 then and thereupon instead of praise and distinction 
 among my fellows, I am become a scape-goat, my good 
 deeds are derrogated and I am maligned by a perverted 
 public opinion as a menace to society ! What can be the 
 doom of any nation where such doctrines are accepted 
 as standards and guides! When it becomes a public 
 policy to suppress the bright and individual lights to the 
 lull blur of mediocrity! 
 
 \or is the foregoing sentiment confined to denouncing 
 me. It extends also to my benefices. What shall I do 
 with this seven hundred and twenty millions which in 
 these twenty years I have accumulated, together with 
 all the money I have made by side investments? It is 
 more, far more, than it would be wise for me to leave 
 to my children and to my collateral kin. What more 
 natural thing is there for me to do with it than to use it, 
 guided by my wisdom, to help forward the scale of 
 being of my fellow man. The endowment, the founda- 
 tion, is just as natural a creation of the industrial genius 
 as the shell is to the snail, as is the shop which he builds 
 to cover his machinery. He can no more resist the im- 
 pulse to devote his wealth to the ends of human uplift, 
 unless he be therefrom discouraged by some order of 
 public disapproval, than he can resist the impulse to 
 walk. The fact that he may be in truth the most selfish 
 of human beings, does not relieve him from this natural 
 thrust. Where would you have found a more self- 
 centered man that Russell Sage? In him the sense of 
 money-getting had become so acute that he denied him- 
 self appropriate clothing in order that there might be 
 more to place on interest. His wealth at his death was, 
 perhaps, a hundred millions. What became of it? To 
 what selfish use could it be applied? Building a marble 
 
shaft a thousand feet high? Not so. The practical 
 mind that can accumulate a hundred millions cannot 
 contemplate the derision which on part of its fellows 
 would follow such absurdity. He turned his millions to 
 human good; and what 'was his reward? What is the 
 right and due to which he has thereby become entitled? 
 It is the gratitude and good will of his fellows. "It was 
 damned white of Andy !" This is the epitaph which Mr. 
 Carnegie wishes may be carved upon his tomb by the 
 grateful hands whom his wealth has lifted to higher 
 life, and is there a human being who carries a heart 
 that would deny it to him? Under the impulse of a 
 sense of public gratitude, and that natural feeling which 
 exists in the breast that "it is better to give than to 
 receive," public benefactions of the wealthy have year 
 by year gone on in the United States to enormous 
 totals; in 1913, for instance, they reached $302,000,000 
 and each and all sums were devoted to ends highly 
 worthy and necessary, the gifts comprising hundreds of 
 donors. And yet we have the government of the United 
 States, as expressed through its agent, Mr, Frank P. 
 Walsh, Chairman of the Industrial Relations Commis- 
 sion, saying in a speech before a large number of people, 
 this: 
 
 "Is there any person who will not challenge a 
 $100,000,000 foundation ; exempt from taxation and 
 to be used in a way that the people do not dominate? 
 There are no limitations on those funds. Suppose 
 all these foundations should concentrate their re- 
 sources in the securities of one industry where the 
 toilers were making a fight for democratic control. 
 They would crush down the defences of the fight 
 for industrial justice." 
 
 The idea is that foundations ought to be prohibited by 
 law because they might upon occasion consolidate their 
 funds and break a strike ! And this from the head of a 
 United States Commission installed and set in motion to 
 investigate in behalf of the whole nation the relation 
 of industry to the commonweal. Where is there a dis- 
 ciple of the perverted doctrines of labor unionism who 
 could have said more or worse? What Darrow, what 
 McNamara, what Gompers is there who could discharge 
 at a great philanthropic endeavor expressions more 
 sounding in scorn. Of all the great of American busi- 
 ness, who have made these United States so mar- 
 velous, so prodigal an expression of industrial achieve- 
 ment, there is none whose feats have been vaster, 
 more lustrous or far-reaching than those of John D. 
 Rockefeller. That he should have taken advantage of 
 monopoletic conditions in his business career to further 
 his operations, is in no sense a reproach upon him, but it 
 is upon us. No man who has ever operated largely in 
 business has done or could do otherwise under the ad- 
 justments of the times. Men in business are forced to 
 employ all the avenues in the business field to shape 
 ends to their advantage ; if they do not their competitors 
 will do so and drive them from the business contest. 
 Men will utilize the advantages of monopoly in business 
 to circumvent a rival, and in their capacities as citizens 
 will at the same time work in a public way for the 
 abolition of the very monopolies through which they 
 have benefited. Public opinion, its law makers and 
 courts define the scope of the field of business, and no 
 business man should be blamed for doing at any time 
 
for his own behoof anything that is lawful.* To depre- 
 cate the great gift which Mr. Rockefeller has bestowed 
 upon the people of the nation in the magnificent institu- 
 tions of practical science and learning he has established 
 is a public shame and disgrace, and comes poorly enough 
 from the lips of one who is drawing public money upon 
 the hypothesis that he is conferring a public benefit. 
 There is nothing more significant of the general disrup- 
 tion of social order into which such doctrinaires as Mr. 
 Walsh is thrusting us, than the tolerance of the public 
 to these attempts to popularize disapproval of men 
 donating their wealth for human enlightenment and 
 
 * Let me illustrate: The Standard Oil Company, a large pro- 
 portion of whose stock is reputed to be owned by Mr. Rocke- 
 feller, is a manufacturer of gasoline, which product, it is stated, 
 it has been selling in the California market at eight cents per 
 gallon. This is said to be the lowest figure at which it is pos- 
 sible for a small refinery to manufacture it, and if such are to 
 continue their output of gasoline they must do so without profit. 
 If these statements be true it would appear that the Standard 
 Oil is selling its product at the highest price that would give it 
 the entire market of the commodity, assuming 'that all parties 
 paid a similar price for their crude oil, which is probably the 
 fact. Its competitors say the Standard can sell at eight cents 
 and still make a profit by reason of its larger capital employed 
 and its greater and more highly wrought facilities for manufac- 
 turing and marketing, and that the purpose in so selling is to 
 force its competitors out of business, either compelling them to 
 quit at a loss or to sell their plants to it; after which, being 
 then in absolute possession of the market, it will raise the price 
 of gasoline. 
 
 If the Standard, through the use of large capital, or superior 
 management or facilities, is actually producing gasoline at less 
 cost than its competitors, it has certainly a right to this benefit; 
 and no complaint can be made at it turnishing the public with 
 the product at the very lowest cost. Anyone can get all the 
 capital he wants if he be able to show good security therefor 
 and reasonable certainty of interest jrields. There is. hence, no 
 monopoly in that direction. And in respect of facility and 
 management there is no monopoly in this; the field is free, and 
 any one may employ in his business all the appliances and abili- 
 ties he can bring forth. This is a legitimate zone for contest. 
 Nor is it to be allowed that should the Standard eliminate from 
 the field its competitors through underselling them that they, 
 realizing that upon their withdrawal the price of gasoline would 
 at once go up, would thereupon dismantle and junlc their plants. 
 They would cease gasoline production, carrying on or not the 
 other processes of oil distillaton as the same may or may not be 
 profitable, and wait the predicted rise in the price of gasoline, 
 when they would again start up. So the assertion of the merg- 
 ing or elimination idea as being at the bottom of the Standard s 
 action in holding down the market price of gasoline must be 
 deemed erroneous. The reason is to be looked for elsewhere. 
 And it is, perhaps, found in the disclosures just made in the 
 Washingtori press dispatches that the Standard owns a patented 
 process which enables it to produce from a given quantity of oil 
 three times the amount of gasoline that can be otherwise ob- 
 tained. Here, then, if this be true, we have it: The Standard 
 has a monopoly; a monopoly of the gasoline industry resting 
 upon the monopoly of a patent. Its industrial monopoly abides 
 not through "capital," size of plant or "big business, but upon 
 law. Can anyone blame the Standard for taking advantage of a 
 law that gives it a monopoly in its business? If it were not 
 manufacturing under the patent, is it not likely that some other 
 refinery would be doing so? The Standard did not make the 
 law. and it does not control the law's existence. Our ancestors 
 made it and we control it. Let us then have done with reviling 
 the Standard and abusing Mr. Rockefeller, and turn our thoughts 
 to so adjusting the law that monopolies of this order may not be 
 possible. I have pointed out in my Industrial Unrest the remedy 
 for this condition. It is simply permitting the inventor to fix a 
 royalty upon his invention, the government, which grants the 
 patent, collecting and paying him the sums received, the inven- 
 tion itself, being open upon equal terms to all desiring to use 
 it. This would end this order of monopoly and allow free play 
 to those qualities in business from which one has a right to 
 benefit, and the furtherance of which should be encouraged. 
 Such a provision could readily be safeguarded to make it effective 
 so the inventor would be powerless to prefer one user as against 
 another. 
 
uplift in fields in which it is not proper for the gov- 
 ernment to operate, 
 
 PROFIT-SHARING. 
 
 I have discussed proftt-sharing in my- Industrial Un- 
 rest. It is believed by many to be the true solution of 
 the labor question. If laborers own an interest in the 
 business why would they not have a care for the welfare 
 of the business, and so caring they would work on in- 
 creasing their eflFective output, and not strike or destroy 
 the property of the plant, for this would decrease their 
 profits, and proportionately destroy their prooerty. I 
 have never heard of any one objecting to a laborer be- 
 coming an owner in the property. The stocks of all 
 corporations are usually purchasable on the public 
 market, and the laborer, as anyone else, is privileged to 
 buy. Indeed, so desirous are many corporations of 
 having their employees become interested with them in 
 the business that they make special inducements, under- 
 market prices, installment payments, etc., to move their 
 employees to "become stockholders. The union does not 
 like thi.s sort of thing, as it tends to transfer allegiance 
 of the laborer from the union to the company, and we 
 hear all sorts of hard things said about the *'robl)er 
 capitalists" who coin the sweat of their men into dol- 
 lars and use them to conduct their business with. But 
 this is not the order of profit-sharing to which the ad- 
 vocates of that principle refer. They propose that with- 
 out purchase of stock or interest, without investment, 
 merely by right of the laborer working and receiving 
 wages in the concern, he should be paid in addition to 
 his wages, a proportion of the profits of the enterprise — 
 that is, if there are profits. Already he has received as 
 wages the full measure of the sum for which by his 
 agreement he worked, and which on his behalf, his 
 union exacts. He has hence been hiVy paid. But if 
 there shall be profits, it is assumed that they arise in part 
 through his industry and he shall be further paid, while 
 if there be no profits, though equal amount of energy 
 be by him expended as when he received profits, then 
 he is^ not entitled to further pay. In other words, his $3 
 or $5 per day \\4iich he receives as wages, is predicated 
 upon the industry breaking even. So that on this basis 
 the industry rs run specially to give him employment. 
 It is not supposed that the proprietors shall benefit from 
 the business from this standpoint. In fact they may 
 lose, for his wages must be paid withal. But if the 
 contingency occurs that a profit ensues, then this in- 
 cident befalls him a benefit, for such profit belongs not 
 to the proprietors, but in part to him. This is what is 
 now contended for by the unions and their advocates 
 under the name of "industrial democracy*' ; it, of course, 
 follows with this arrangement, that the laborer, being 
 ovmer of an interest in the business, cannot be dis- 
 charged therefrom ; an attempt by the proprietor to dis- 
 charge him becomes *'a business matter between business 
 men," as Secretary of Labor Wilson puts it, and says 
 that his branch of the Federal Government is in ex- 
 istence to see. on behalf of the laborer, that is to say, 
 the union, to just that thing. I have discussed the up- 
 shot of this scheme in The End of Business, to which 
 the reader is referred. It must be apparent that under 
 profit sharing the laborer receives something to which 
 he is not entitled, something that he does not earn. 
 Of course, if the laborer has received as his wages a 
 so-called minimum, as where full wages are $5 and he 
 
 8 
 
receives but $3, trusting to recover the other $2 with 
 added returns in a profit-sharing device, then it is alto- 
 gether different. He is then an investor in the business 
 to the extent of $2 per day, and is entitled to just such 
 consideration of returns or losses as $2 per day from an 
 outsider would buy. But the profit-sharing idea does 
 not contemplate this. It presupposes, as I have said, 
 paying the man wages as wages; that is, full wages; 
 then, in the event of dividends, to give him a share of 
 these as a sop to stir him to do to the employer the duty 
 which he was paid by his wages to perform. 
 
 It is an essential quality of profit-sharing that it acts 
 horizontally, without regard to the effort put forth; the 
 employee receives his share of the profits, not because 
 through extraordinary effort he earns an addition to- 
 his wages, but because he is an employee. The moment 
 the profit-sharing plan drops its horizontal aspect and 
 differentiates, basing its reward upon service, it becomes 
 a bonus system, and not a profit-sharing system at all; 
 for the bonus system is based upon paying a man accord- 
 ing to his merit, the method of all most detested by the 
 unions. There is no doubt, however, that this is the 
 ultimate form which labor conditions will take. It 
 contemplates a standard of output for a day's work and 
 encourages with rewards care, skill and unusual en- 
 deavor. Rewards of merit are a common feature of all 
 institutions or places where assemblages of either sex 
 work upon an organized basis, and they are not alone 
 fitting but necessary to bring forward the best efforts 
 and permeate the shop with a healthy tone. 
 
 The effect of profit-sharing is to carry wages over 
 into the domain of profit, and whatever narrows the 
 proHt of the proprietor destroys incentive, gives him less 
 disposition to extend business, or even to carry it on, 
 disposes him to look ahead and around for easy jump- 
 ing-off places where he can land on the upholstery of 
 some club or else quit the bother with business which 
 has become too unattractive to be longer worth the 
 candle, and giving himself up to inactivity and a 
 selfish life. There are in the United States today 
 thousands and thousands of men who have ceased busi- 
 ness upon moderate competencies and withdrawn their 
 energies from the befiefit of society through this influ- 
 ence, and profit-sharing is a scheme which accelerates 
 and does not retard this disposition. 
 
 Profit in business is simply incentive. It is the "taste 
 of blood," as the slang has it, which edges the appetite 
 of a man to plunge into busines with fierce energy and 
 make a fortune ; and when the lure of fortune disappears 
 from the realm of business, be sure that business, as we 
 have known it in the past, will in like manner disappear. 
 Of course O'Toole at the corner will still sell crackers, 
 and Heintz at the door beyond will decant his flagons of 
 heavy-wet — these men are not in business to make for- 
 tunes; their capacities are adjusted to simple livings; 
 business of that order and a little better will go on ; but 
 the men who level forests, who build steel works, who 
 slide great ships smoothly and swiftly down the ways, 
 and those who send them far and yon upon the seven 
 seas — these men will be no more ; the government will 
 be doing such things with initiative supplied and put in 
 place by the politicians. 
 
 FEDERAL EMPLOYMENT BUREAU. 
 
 There is no objection and much to commend extend- 
 ing the facilities of finding employment to laborers. 
 
through the offices of the postal department. That this 
 is a proper function of government I have explained in 
 the Manufacturer's pamphlet. It would by no means 
 solve industrial unrest, , which moves altogether from 
 another cause; but it would greatly aid in distributing 
 labor, idle in one spot to places where it may be needed. 
 Seasonal employment has always existed in the United 
 States. When certain industries close for the winter 
 the men drift to the cities and are idle until spring; this 
 has ever been the occasion of annoyance and sometimes 
 stress. In the Manufacturer's pamphlet and The End of 
 Busitiess I show how, under normal conditions, this 
 state of things would not occur to the inconvenience of 
 laborers. 
 
 HIGHER WAGES. 
 
 In this clause of the list lies the whole cause of the 
 industrial disturbance. I have gone into it extensively 
 in my prior writings and will only touch upon it here. 
 A man comes to my shop for work. 'What are you 
 paying?" he asks. "Two dollars," say I, "far a nine- 
 hour day." "That is not enough," he replies; "I am 
 offered by Brown two and a quarter for an eight-hour 
 day." "Very well," say I, "that is all we are paying 
 here," and he goes to Brown. But more business comes 
 into the shop and I need men. I can't get them unless I 
 pay $2.25 for eight hours, because business is brisk and 
 men are needed everywhere. This, says the union, is 
 the law of supply and demand. That supply and de- 
 mand, in the sense in which it is commonly understood 
 in the field of commodities, does not apply in the realm 
 of service I have shown in Our National Tendency and 
 Its Goal. But I have also shown that there is such a 
 thing as a natural and an artificial supply and demand; 
 the natural condition is that I have described, where 
 men are scarce through prevalence of business activities ; 
 the artificial is where the union keeps men, otherwise 
 idle, away from the shop until the high wage rate de- 
 manded is paid. In the first case the wage requirement 
 is normal and proper and does no harm to industry; in 
 the second case it is wrong and injurious and tends to 
 destroy industry. It is this slipping of the cog from 
 normal to abnormal wages that has caused the indus- 
 trial unrest. 
 
 The remedy is not by allowing higlier wages, but by 
 readjusting wages to the natural line. If industry is 
 to survive in the United States without passing the 
 nation through the evolution which now threatens, 
 namely the centralized State or Socialism, a terrible 
 war of the character raging in Europe, followed by a 
 breaking away again from the centralized form and a 
 moving once more in the direction of individual liberty 
 — if this is not to be the process, then wages must be 
 placed on the normal basis, and natural law must 
 again prevail in the industrial world. Existing wages 
 are the result of successive raises which have been forced 
 upon the employer by the union, without regard to the 
 price of the product as determined by a competing 
 market, to pay the wages. The policy of the union has 
 been to get higher and again higher wages, less and ever 
 less hours, and shop conditions under which the laborer 
 was privileged to turn out as little product as possible, 
 because the more he produced, the less, it was assumed, 
 "labor" would have to do. This operation has enor- 
 mously increased cost of the product and lessened the 
 area of its profitable shipment from the site of its pro- 
 duction, and has not benefited the laborer, for it has 
 
 10 
 
raised the cost of living always in excess of the relative 
 raise in wages. What is transpiring now is a rapid 
 contraction of this zone of profitable shipment, a pro- 
 cess that is going on so fast that the contrary force of 
 cheapening cost through invention and improved sys- 
 tems has not been able to keep up with it, but has been 
 wholly overcome and set to naught by this strongly cen- 
 tralizing power of the artificially raising wage. It will 
 not be long before goods will be produced at too high a 
 cost to ship very far from the factory. Clothing made 
 in San Francisco at high cost, may find a limited market 
 in the immediate vicinity of its production ; but when 
 the charges of packing, shipment and incidental costs 
 are added to get it over in Nevada, it becomes too ex- 
 pensive to be purchased by the would-be Nevada con- 
 sumer. Such clothing is limited to the luxuries of the 
 rich, and the market is narrowed accordingly. The 
 effect of this is thrown back upon the San Francisco 
 factory; its market being curtailed, it must turn off 
 hands, and so the idle army is formed and increased. 
 
 Artificially high wages, therefore, that is, wages which 
 can only be paid through increasing the price of the 
 product, decrease consumption of the product, lessen the 
 numbers of the laborers engaged in the industry and 
 throw men out of work. As this action goes on the idle 
 industrialists continue to increase, and corresponding 
 stress prevails throughout the nation. I have noted in 
 my Manufacturer's pamphlet the condition of England 
 just prior to the war, with its million of registered pau- 
 pers in a population of forty-six millions, with its vast 
 system of work houses and its elal>orate poor laws and 
 out of work provisions, with its unionized industry con- 
 solidating into a single body and shaping itself for a 
 mass strike to have been held in 1915, with the business 
 men on the other hand raising two hundred and fifty 
 millions of dollars to resist its attacks. Manifestly this 
 strain, which obtained with equal intenseness in every 
 country of Europe, could not continue long, for the 
 dry rot of the unemployed, which is decadence, was eat- 
 ing into the heart of the nations, especially of England 
 and France, which countries were less given to govern- 
 ment initiative than was Germany. There followed, ac- 
 cordingly, war. War always comes to save civilization. 
 If there is one fact readily to be recognized it is that 
 from the beginning the Divine command upon man has 
 been progress; this has been attained by driving forward 
 the race at the sacrifice of the individual. Onlv in this 
 way could man have progressed, and his career has been 
 successive progression from the ape to the present day. 
 In driving him on it was necessary to hold down his 
 numbers, or the earth would have become over popu- 
 lated with, inferior beings, for the tendency of population 
 is to outrun development of the mind. Severe checks 
 unon population, therefore, have to be by nature ad- 
 ministered upon the race wherever conditions within it 
 arise which arrests its development and halts its pro- 
 gression. This is the meaning and purpose of war. 
 The phenomenon is presented and worked out in my 
 War and Business. War, therefore, necessarily follows 
 the state of things which the labor union with its arti- 
 ficial wage is rapidly bringing upon the country. Under 
 such conditions it becomes necessary that large numbers 
 be killed off and their property destroyed, in order that 
 people shall be given something to do in building it up 
 again when the war is over, at which time there shall 
 not be left more people than there are jobs. In other 
 
 11 
 
words, population, which has run ahead of the unfold- 
 ment of mind, is killed back to a number to accord 
 with the status of the mind's development. The proces- 
 of reproducing the destroyed structures and industries 
 generates a national activity which drives civilization a 
 few pegs further on beyond what it was at the out- 
 break of the war, just as the reproduced San Francisco 
 is a better built city, of more imposing edifices than the 
 one which was destroyed. This is the law. It is the 
 operation of the same principle in that region of Nature 
 which acts in human affairs as that which moved Mr. 
 Powderly while head of the Knights of Labor to advise 
 his followers to break the empty bottles that the bottle 
 makers might have work in making new ones ; that 
 causes the unemployed carpenter to feel glad at the sight 
 of the burning building, for he may be called to the 
 work of constructing a new one. When population 
 thickens, and men are thrown off as slough from the 
 wheels of industry through wages fixed at figures where 
 to pay them the prices of the commodities must be 
 raised, so that consumption is greatly lessened, and the 
 number of men in industry must be accordingly les- 
 sened, and when this has eaten some distance into the 
 heart of the nation, war ensues; it may be external or 
 internal war; it may be a matter of moment that shall 
 start it, or the ignition may be through a very trifling 
 incident ; in any event it comes ; large numbers of people 
 arc destroyed,* property is wrecked, and when the war 
 is over the nation gathers its strength and builds it:^ 
 structures up again. There will be no unemployed in 
 Europe at the close of the war; there will be work for 
 everyone ; a vast reconstruction period shall have set in 
 upon the nations, and before this spell is broken Euro- 
 pean civilization shall have gone to a higher station than 
 it has ever yet attained. Here, then, we see the magnetic 
 cord that threads together the thousands on the sand 
 lots of San Francisco with the thousands in the trenches 
 of France. 
 
 Upon the other hand if industry is properly adjusted, 
 if natural law be regarded in the economic arrangement 
 of a nation, increase in number of population does not 
 create the phenonrena of disturbance we have noted. 
 The more men who then come into the nation the better 
 it is for every one, as the higher is the cooperative effort 
 and the greater and more abundant the wealth, which 
 once produced finds a just distribution according to the 
 individual effort contributed. Adjust industrial society 
 according to economic law, and continental United 
 States would sustain in the highest luxury the entire 
 human race ; whereas under existing arrangements, Cali- 
 fornia, capable of sustaining a hundred million, is over- 
 crowded with less than two and a half millions, so that 
 there are thousands of men on the lots I have mentioned, 
 
 • Emigration stands as a counterpart of war in relieving 
 populated centres of congestion. The emigrant in his new field 
 creates produce which is sent back to his native land in the 
 form of trade, while he enriches the country in which he works. 
 War kills the worker, and by destroying construction provides 
 work in reconstructing for the survivors, many of whom were 
 unemployed at the outbreak of the war. Where emigration does 
 not exist, war is the only alternative at the crisis stage of the 
 civilized development, under the system of economics now ob- 
 taining in all countries, that is: artficial wage, protective 
 tariffs, business smothered with taxes and restrictions and land 
 held idle for speculation. We can understand, therefor, the 
 crime of those who operate to exclude immigration for which 
 there is an industrial demand in the country, otherwise they 
 would not come. Such mistakened advocates are merely piling 
 up the people in their home areas, many of whom must be slain 
 by war. 
 
 12 
 
and sheltered by trees and vacant buildings up and down 
 the State, men for whom society has no use. With 
 society adjusted under economic law. civilization rapidly 
 rises, and as it ascends, increase of population declines, 
 the birth rate being least in the stratum of society at 
 the summit of civilization. The graduates of the uni- 
 versities die out in five generations. Great fecundity 
 obtains on the lower levels of civilization. Feed 
 ignorant people well and they multiply rapidly. The 
 large families are among the peasantry, not among the 
 college professors. So that under economic law, a rising 
 civilization would automatically shut off its increase Ol 
 population so that tht earth would never become over- 
 populated ; which condition would otherwise • occur to 
 the density of Belgium within three centuries, at the 
 existing ratio of increase of the population of southern 
 Russia. Proper economic adjustment, at the bottom of 
 which lies the wage question, would therefore secure 
 continuous peace, and abolish war. 
 
 Natural wages, or wages according to economic law, 
 is the chief remedy for the general disturbed condition 
 of the industrial and social world we have been noting. 
 These are wages fixed at a sum which the price of the 
 product does not have to be raised to pay ; which allows 
 the employers to compete in and hold, not only the 
 markets of his own State, but to enter adjoining States 
 and also to enter the great markets of the world and 
 compete there with foreign manufacturers ; wages which, 
 therefore, will enable the employer to extend his busi- 
 ness, instead of forcing him as at present, to narrow it; 
 that will move him to take on hands and draw men 
 from the idle army, instead of laying off hands and 
 increasing it, as is now constantly going on. I shall 
 hear at once cries of "Oh, we can't go into the foreign 
 market, we can't compete with the pauper labor of 
 Europe; do you want us to reduce our living conditions- 
 to the condiiton of the semi-serfs of Europe?" To 
 which I reply : I think we shall travel far in Europe to 
 find wages tixed at a lower rate than is being paid to 
 those multitudes of men in their cantonments on the 
 .«and lots ; and when you graduate from these upward 
 in the scale of wages, comparing those of the United 
 States with those of Europe, you find them, under equal 
 conditions, just about the same; not the same in amount, 
 liut relatively the same in the purchasing power of the 
 wage when received. I say "relatively the same," for what 
 oppresses the European laborer is not his low wages, 
 for low V ages are normallv attended with low cost 
 of living. The laborer in the United States would live bet- 
 ter on low wages than he now lives on his artificial high 
 wages ; for the reason that under low wages and the 
 call into cooperative effort of multitudes of men now 
 kept out of industry by the effects of those same high 
 wages, and kept out of the country by immigration ex- 
 clusion laws mistakenly laid to protect those same high 
 wages— with these changes, I say, the American laborer 
 would live at slight cost by reason of the cheapness and 
 plenty of everything; under such conditions, with offer- 
 ings of work everywhere about him and times good, 
 wages would be relatively high compared with the really 
 low wage he receives at present, though he is paid every 
 pay-day with a hat full of coin. What holds down the 
 European worker is that after receiving low wages he 
 must spend it in a high market, not a market made high, 
 as it is here by artificial wage, but by taxes imposed by 
 government, enormous imposts drawn from industry to 
 
 13 
 
sustain armaments, navies and unceasing preparations 
 for war; to maintain great overlord military and official 
 castes and establishments, whose existence are not a 
 particle of benefit to the people, but which terribly op- 
 press them and eat out their substance, which is yielded 
 up upon the concept that the man of the countr>' across 
 the creek or beyond the timber is their natural enemy, 
 and unless they get ready to kill him he will come on 
 and kill them. How inexpressibly false and foolish all 
 this is, leading nowhere but to ruin of millions, I have 
 shown in War and Business, and that it exists only and 
 solely because natural law is not followed in their eco- 
 nomic systems, which same natural law I am trying to 
 show the United States in order that we may be spared 
 like calamity. 
 
 In the field of foreign trade, the trade of the Orient 
 and of South America, there will be many things which 
 we cannot produce in competition with Europe, which 
 therefore, we ought not produce, and many things which, 
 by reason of our natural resources, our climate, our skill 
 and mechanisms, our geographical position and propin- 
 quity to the markets, we can produce, and have here in 
 San Francisco, and at every port on this Coast, a vast 
 commerce. Did you ever think of this fact : that of the 
 twelve greatest seaports in the world, the only one 
 accredited to the United States is New York! San 
 Francisco with her enormous advantages is not men- 
 tioned. That of those twelve, four stand facing the 
 Pacific, some of which we scarcely know, and with all 
 of which our trade is trivial. There is Hongkong with 
 20.500,000 entered and cleared tons per year; Shanghai 
 with 18,500.000 such tons — two ports that but for the 
 curvature of the earth you might see with a spy-glass 
 from Telegraph Hill, so straight do they lie on a line 
 from the top of the Call Building, and yet what are they 
 and their enormous traffic to us? Singapore lies around 
 the curve of Asia at the toe of the Malay Peninsula, 
 almost within pistol shot of the flag of the United States 
 flvins: over the Philippines. It has a shipping of over 
 15,000,000 annual tons. And there is Colombo? Who 
 in San Francisco ever heard of Colombo? And yet 
 Colombo has fourteen millions of tons of annual traffic 
 and is the chief city of Ceylon, lying at the point of 
 India, just south of Calcutta, south of Bombay — great 
 ports of India whose trade naturally belongs to San 
 Francisco as much as to London or Hamburg, and yet 
 about which we know little or nothing at all. 
 
 And how can we get this trade and make San Fran- 
 cisco and the ports of this Coast what they ought to be? 
 By the same process through which our manufacturers 
 can hold their markets against the Easterner, namely, by 
 the restoration of natural wages, wages which, let me 
 repeat, are determined by what the product, sold in the 
 competitive market will allow to wages, and by what the 
 employee will be willing to accept in view of the offer- 
 ings of other industry. This is the simple rule, the 
 economic law from wiiich we have wandered, in involved 
 and intricate courses, through the maze of high wages, 
 short hours, limited output, indifferent work, while in- 
 dustry' is throttled, prices soar, markets close, business 
 initiative fails, occupation ceases for hundreds of thou- 
 sands of men ; and we have the over-straining of private 
 charity, the appropriation of public alms, the moving of 
 the State into the control of business which business men 
 are pushed out of, and there are calls for out of work 
 pensions, maternity pensions, old age pensions, minimum 
 
 14 
 
wage, eight, six and five hour laws, workmen's compen- 
 sation, the adoption by the State of the laborer as a 
 ward and prosecution on his behalf of the employer to 
 enforce against him the laborer's notion of his contract, 
 a development which has caused thousands of employers 
 of one and two men to lay them off and do the work 
 themselves or let it go undone, and so on and so on; 
 swarms of new laws, endless schemes of restriction and 
 compulsion, unheard of commissions, taxes without num- 
 ber, burdens without limit, until business becomes a 
 thing that a man would flee from if he could find a way 
 out, and few would have the hardihbod to enter. 
 
 And yet notwithstanding it must be apparent to any- 
 one who will bestow a little thought upon the subject 
 that our troubles have arisen from our forsaking the 
 natural law of wages, we find all agents of the govern- 
 ment, whenever they get into harness, running strongly 
 toward Socialism. Never for a moment turning their 
 thoughts toward liberty, to determine whether in that 
 direction there may not be some avenue of escape from 
 intolerable conditions, they see no way out but by the 
 road which leads to conversion of the State into a 
 domestic overlord. Their absence of rational explana- 
 tions and sane direction concludes even the great capi- 
 talists like Daniel Guggenheim and thousands of others, 
 that Socialism is the only possible refuge, and that it 
 must come with whatever conditions it entails. In 1907 
 the President appointed, under act of Congress, a com- 
 mission to investigate the question of immigration. It 
 was comprised of eminent men, various of them mem- 
 bers of Congress. It spent three years in the work, and 
 produced illimitable tomes of data and report. Little 
 that it developed was new, and its recommendations 
 were worse than useless, in that they called for restric- 
 tion of immigration in conformity with the doctrines of 
 the labor unions. The recent immigration acts contain- 
 ing the literacy test, now vetoed by three presidents, 
 were the outcome of these recommendations. The com- 
 mission did not give thought to analyzing the meaning 
 of migration as a natural law, whereby the error and 
 injury of restriction might have been seen, as well as 
 the folly of supposing that it is an injury to laborers 
 already in the country, but it devoted its time to collect- 
 ing and compiling facts, very voluminous and of 
 small account. Now, therefore, after this ineffectual 
 commission shall have gotten off the ways, we have an- 
 other, in and about similar business; this time the 
 Industrial Relations Commission to which I have re- 
 ferred, whereof, as I have stated, Mr. Frank P. Walsh 
 is chairman. This body for two years past has been 
 inquiring of all and sundry from the four sides of the 
 continent the cause of the industrial unrest. From such 
 lucubrations as it has evolved out of the wisdom of the 
 witness stand. Chairman Walsh has quite definite notions 
 upon the subject. In a speech before a New York 
 audience recently he said : 
 
 "We have to realize in our problem that toil and toil 
 alone produces wealth; and the toiler is no better than 
 a slave unless he has for himself a compelling voice in 
 fixing conditions under which he is compelled to work, 
 his wages, his hours of labor and conditions as to safety 
 and sanitation. Low wages and the conditions that arise 
 from them are at the heart of our problems of today. 
 
 15 
 
. . . We cannot go on with autocracy in business. The 
 fact that the majority of the employing power in Amer- 
 ica is lodged in Manhattan Island is a menace to the 
 perpetuity of our institutions, for it is but a step from 
 the autocratic control' of industry to the tyrannical con- 
 trol of government." 
 
 There can be no question that Chairman Walsh is a 
 Socialist. Whether he was such before he accepted his 
 place on the commission, I do not know. None could 
 be farther wrong than he in his utterances. Wealth is 
 not produced by tajl or by the toiler; it is produced by 
 mind. The toiler himself is useful just in degree as li^ 
 employs thought in his work. VVhethcr the toil 1.. 
 supplied by brawny arms, by the muscles of the horst., 
 or by the swift whirling wheels of the mechanism, it i>^ 
 the directive force that elicits the yield ; and if we shall 
 permit the blind physical executives to overcome the 
 guiding thought, there is an end of all order, and con- 
 fusion pervades. The trouble today is that the em- 
 ployers have not control of their conditions' of labor. 
 The very state of things which have produced the 
 disturbance is what this Federal official Walsh wishes 
 farther developed along the lines which have occasioned 
 the damage, "Ix)w wages" is not "at the heart of ou 
 problems today," Never in the world's history, in an\ 
 nation, at any time, have wages been so high — that is. 
 so much coin paid for the work, and Chairman Walsh 
 would have them still higher! The trouble, as I hav' 
 shown, is the very converse of the view he asserts; ii 
 is the resulting evils of artificially high w-ages that have 
 produced the prevailing untoward result. 
 
 And when Mr, Walsh succeeds in abolishing "autoc- 
 racy in business." let us then be very sure that business 
 also will be abolished ; that is, business as performed by 
 business men. From thence on such attention as it 
 receives will be bestowed by politicians in the pay of 
 the State. The condition of which Mr. Walsh complains 
 is nothing other than the power of the employer to dis- 
 charge the hand while continuing to conduct the busi- 
 ness. This is the "industrial democracy" to which I 
 have heretofore referred, as well as to the attitude of 
 the Federal government, through its Department of 
 Labor, on this question. It has come to pass that the 
 government steps forward and takes up the cause of 
 one group of citizens against another, not where any 
 wrong is committed by those whom the government thus 
 opposes, but where right only is insisted upon. It does 
 not take a wise head or a farseeing eye to perceive th< 
 confusion and collapse that must ensue in our affair^ 
 and to our nation, if principles such as these are favored 
 to supplant those sound and safe abstractions upon 
 which that government was installed. 
 
 The assumption for which Chairman Walsh is now 
 engaged in creating public opinion has just been pro- 
 nounced against by the Supreme Court of the United 
 States, which has vitiated the statutes of fourteen States, 
 California among the number, making it a crime for an 
 employer to require of an employee, as a condition of 
 employment, that he would not join a labor union. Six 
 justices stood for the principle that the employee's 
 
 16 
 
liberty of making amtrac^s 'do€|S' WliiqWde.a oower to 
 procure employmetit against the will oi^ 'the employer. 
 The question of what may, affect the employer's will is 
 altogether immaterial. It may be anything, legal or 
 illegal. It is sufficient if, under any condition, the em- 
 ployer does not wish to employ a man ; he is not to be 
 by law compelled to do so. Nor once having introduced 
 a man into his service, is he to be made the victim of a 
 law to force him to continue such man in his service 
 against his will. Immediately it becomes lawful for the 
 employee to either enter or to remain in the employer's 
 service contrary to the will of the latter, that moment 
 is the property of the proprietor confiscated by the State 
 and set aside for the benefit of the employee, who is 
 thus specialized as a class and favored by the govern- 
 ment as against the rest of the citizenry. 
 
 The only remedy for the condition that oppresses all 
 industry, employer and employee alike, with its dread 
 consequences to society and to the nation, is return to 
 the principle of human liberty. There must be recog- 
 nized as the basis of industry the inherent right of the 
 employer to employ whom he will, when he will, for as 
 long a time as he will, for what wages and under what 
 shop conditions he will, and to discharge when he will, 
 subject only to the employee's acceptance of the offer 
 of the employer, and to the obligation of whatever con- 
 tract there may be made between them; and all idea of 
 the employee being the subject of an oppressive environ- 
 ment that has compelled him to accept the conditions 
 of the employer or starve, or of the employer that he 
 must have through the arm of the State a force com- 
 pelling the employee to continue a service which he 
 becomes unwilling to perform, doing this by a power 
 chaining his body to the job, when under common law 
 he would be guilty only of a breach of contract answer- 
 able in civil damages, all this must be abandoned, and 
 remedies for the condition of things of which the 
 parties complain must be looked for in other directions. 
 The employee must strike hands with the employer in 
 increasing jobs; that is, in increasing business, and must 
 turn thought to the methods by which this can be done. 
 It is not to be done by coordinating in the starting of 
 new enterprises, but by removing the obstacles which 
 exist in public law and systems, labor union and other, 
 to new business being started. As business is essentially 
 service of one man upon another, and its extent held in 
 bounds only by the ability of the individual to render 
 service, so business should at all times exist in great 
 abundance ; jobs should always be calling for men on 
 every hand ; industry, as I have elsewhere said, should 
 be held back by lack of men, not by lack of customers, 
 as is now the case. 
 
 How to bring this about is extremely simple. It is 
 by returning to the principle upon which this nation 
 was founded, namely, by recognizing that all men are 
 equal ; that they each have all rights up to where the 
 exercise of such touches the border of like rights of 
 his neighbor. That government exists only for safe- 
 guarding those rights, and its function is to hold a 
 balance hand between man and man. and to maintain 
 order, which latter is care for the public safety and the 
 public health. That the moment government steps over 
 these bounds, it invades the rights of man and becomes 
 
 17 
 
a tyrant, and it .isj ^^ fiature of. all tyranny that it ever 
 increases from -oiiirage to outrage until war ensues. 
 With the principle of human liberty and equal right as 
 a guide, held ever in hand as a carpenter his standard, 
 industrialism may again be made safe, and business 
 prosperous ; while without this, on the course we are 
 now proceeding, order must dwindle, chaos must super- 
 vene and havoc, such as we have already so abundantly 
 known in the United States must transpire, only to be 
 stopped by war, which is in itself a kind of order — the 
 order of force working to attain the order of peace. 
 
 18 
 
WRITINGS OF JOHN E. BENNETT 
 BOOKLETS 
 
 The following are short articles published in a form to be 
 easily cajrried by the ordinary business envelope, together 
 with a letter, under a two-cent stamp. 
 
 WHAT WILL BECOME OF BUSINESS? 
 
 Being an abridgment of the pamphlet. THE INDUSTRIAL 
 UNREST, and designed for use as either an introduction to 
 the reading of that paper, or as a synopsis of it for the re- 
 quirements of the busy man. 
 
 THE END OF BUSINESS 
 
 A short essay upon the passing of the employer's right to 
 discharge an employee, hence to maintain control over his 
 business; the incident vesting in the employee of a property 
 right in the employer's establishment by virtue of the induc- 
 tion of the employee therein, and the attitude of the govern- 
 ment of the United States through its Department of Labor 
 in reference to this demand. The effect such principle must 
 have upon business and statement of the needful changes in 
 the industrial and political world to restore freedom and 
 bring prosperity to industry. 
 
 AS SEEN IN AUSTRALASIA 
 A review of the recent report of the Commission of the 
 National Association of Manufacturers upon "Industrial Con- 
 ditions in Australasia," the same being a survey of the opera- 
 tions of trades unionism and its concomitant legislation in 
 Australia and New Zealand, with information gathered upon 
 the subject from other sources. In these Colonies the trade 
 union principle is probably further developed than in any 
 other region of the world. Having control of the respective 
 governments, the unions have been able to apply their doc- 
 trines with the force of law. All the various legislative and 
 other schemes and expedients Just entering the domain of 
 business here, have there been in existence sufficiently long to 
 test out their value to society. The result has been a highly 
 increased degree of Industrial unrest, incessant strikes and 
 disturbances, restricted development, slow growth and busi- 
 ness stagnation: the artificial increasing of wages correspond- 
 ingly raising the cost of living with incidental widespread im- 
 poverishment, the workers, as stated by a leading Australian 
 economist, creating "a rod for their own backs." The in- 
 quiry throws much light upon the future of California under 
 labor unionism, and emphasizes the necessary relief to the 
 pressure of population under prevailing erroneous economic 
 policies producing idle multitudes in a sparsely settled coun- 
 try, which relief the existing European war is affording to 
 Australasia in the decimation of her expeditionary contingents. 
 
 THE NEXT PAMPHLET 
 The forthcoming pamphlet is entitled War and Business. It 
 will be a discussion presenting a solution of the vexed ques- 
 tion of further armament on part of the United States, which 
 now threatens not only to convert many thousands of our 
 youth into soldiers, burden business with increased taxes to 
 support the waste of munitions, but is preparing the soil for 
 the blood of our children, if not of many of ourselves and of 
 those who are now our friends, clients and customers, whose 
 duty it will then be, through no fault of theirs or ours, to 
 shoot us, and we them. Incidentally, this paper will present 
 what is confidently asserted as the rational policy and deter- 
 mination of the whole world's peace question, which has 
 occasioned so much controversy, without the result of stopping 
 war, throughout the world. 
 
BUSINESS MEN'S ECONOMIC ASSOCIATIO 
 CHAIEMAN. G. X. WENDLING 
 VICE-CHAIRMEN 
 
 J. A. FOLGER HENRY T. SCOTT i 
 
 W. M. ALEXANDER JOHN A. BRITTOl 
 
 BRACE HAYDEN ROBERT DOLLAR 
 
 W. H. TALBOT 
 
 DIRECTORS 
 
 G. X. Wendling 
 W. A. Grubb 
 J. W. Mason 
 Alexander D. Keyes 
 C. E. Green 
 Robert H. Swayne 
 James H. Schwabacher 
 
 San Francisco Office 
 1310-11 Hnmboldt Bank Bldg. 
 
 Oakland Of 
 418 Syndicate 
 
 Organized in an endeavor to arouse the business 
 a consciousness of its peril in the presence of the inJ 
 unrest; to show the cause of that unrest, and its in^ 
 culmination in the suppression of business as a func 
 the citizen, and the convergence of industry and affa^ 
 the Socialized State, resulting in unavertible war. 
 out the rational and easily understood solution of this 
 tion. which abides in a change of certain public laws, 
 resisting certain policies of labor unions; and to educ 
 public in bringing these changes about, which will 
 business from the restrictions which hamper and pre^ 
 transactions, thereby calling into existence a state 
 business and industrial activity, making wealth abund] 
 distribution just, securing the inviolability of property 
 hands of its owners, and insuring continuous peace ai 
 4uility. 
 
 Excerpt from the By-Laws of the 
 
 BUSINESS MEN'S ECONOMIC ASSOCIATIOl 
 
 Membership of this Association shall be three kinc 
 
 Full membership, the fee for which is $10.00 per 
 and shall entitle the holder to free receipt of all lit 
 and free admission for himself and family to all 
 issued or delivered by the Association. 
 
 Club membership, the fee for which is $2.00 per yc 
 entitles the holder to free receipt of all literature issj 
 the Association and to admission to all lectures upon 
 of one-half the regular price. Club members are 
 only in those cases where at least one full membership 
 in the Association by the corporation, firm or house ir 
 the proposed Club member is employed. 
 
 Professional membership, the fee for which is $5. 
 year, is limited to members of the professions, and entitj 
 holder to free receipt of all Association literature "^ 
 attendance upon all lectures. 
 
Gaylord Br 
 Makers 
 Syracuse, N 
 PfcT.JAK.21, 19 
 
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