IC-NRLF 17fl 737 LIBRARY UNIVERSITY OF CALIFORNIA. Class Problems & Perils of Socialism Letters to a Working Man BY J. ST. LOE STRACHEY EDITOR OF (Fljc Spectator MACMILLAN'S SIXPENNY SERIES (UNIVERS - MACMILLAN AND CO. LIMITED LONDON 1908 A WEEKLY REVIEW OF POLITICS, LITERATURE, THEOLOGY, & AR' ESTABLISHED 1828 EVERY SATURDAY, Price 6d. ; by Post, 6\d. ............ ....... The Spectator contems a List ,f all Books publish^ u shulng in >r uith th " shulng in i>r uith " n " - ,, , lers arian I', ' " ' "'" ^^ ''"' "^' its ns, literary institutions, aiul pri\ate persons. TERMS OF SUBSCRIPTION Payable in Advance ' AKM v. Q, , _D1 O r* Including postage to any of the English H 3 ? 2 Colonies, America, France, (iermany, India, China, Japan, etc. . . 1 12 6 16 3 By Canadian Mail i in e 082 10 6 15 3 078 "SPECTATOR," Ltd., 1 Wellington Street, Strand, London, W.C. ON SALE AT ALL BOOKSELLERS, NEWSVENPORS, AM, BOOKSTALLS EPPS'S GRATEFUL AND COMFORTING. 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Satisfaction Guaranteed or money back, A SWAN' , Fountain Pen is always a satis- factory investment. 10/6 to 20. Sold by Stationers and Jewellers everywhere. CATALOGUE POST FREE. MABIE, TODD & CO., Head Office : 79 & 80 High Holborn, W.C. 93 Cheapside, E.G. ; 95a Regent Street, W., LONDON ; 3 Exchange Street, MANCHESTER ; and at PARIS, BRUSSELS, NEW YORK, and CHICAGO. MACMILLAN AND CO., LiMini) LONDON J'.OMl'.A V ( AI.( I II A Ml.! Till-. MACMILLAN COMPANY YORK i'.us |i'\ ( ||! A I LAN T A- Till'; MACMII.LAN C(.). ()! CANADA, LTD, THE PROBLEMS & PERILS OF SOCIALISM LETTERS TO A WORKING MAN r,v J. ST. LOE STRACHEY i .. (Th ( U iM x >' MACMILLAN AND CO., LIMITED ST. MARTIN'S STREET, LONDON 1908 GENERAL TO THEODORE ROOSEVELT PRESIDENT OF THE UNITED STATES OF AMERICA DEAR MR. / asked your leave to dedicate this hook to you, not* because of private friendship nor out of personal regard, though these would have been reasons amply sufficient. Again, I did not ask your leave because you represent the nation which, next to my own, I love and admire the nation which divides with Britain the allegiance of the English-speaking race. Though I am proud that this page should bear the name of one who sits in the seat of Washington and of Lincoln, it was not any touch of pride that moved me. I asked to lay this book in your hand because I felt that such a dedication would be in the strictest and truest sense appropriate. Tou are not only one of the most convinced and most powerful opponents of Socialism living, but, what is more, you oppose Socialism for the right reasons or, at any rate, for what I deem to be the right reasons. Tou oppose it because you believe that it will imperil the safety of the State, by breaking down the character of v vi PROBLEMS OF SOCIALISM the citizens, and by drying up the sources of national wealth. In a word, you oppose Socialism because it is the enemy of the people. But while opposing Socialism in the name of Liberty, of Justice, of Manliness, and of Common sense, you have never failed to insist that a lawless Capitalism is as great a foe to the nation as a lawless Communism. You will indeed he remembered in History as the man who withstood tl: : options of monopoly and who insisted that the arbitrary alth must be restrained. tint this \ou did without , falling into the destrib . umrt lo- tion as an cviL "me. i have kept that just mean which Tennyson , to the spirit of K?ig/ish l : rcc t ; ~n he addresses bet- as " loatber of the lawless crown as of the cro^ Ton haie been determined to check and denounce t\rann\ whether in capita/ or in labour. That is the anti-Socialism which 1 to support, ll'hether these letters will do anything to accomplish their design remains to he seen, but at any rate they show their true colours by being connected with your name. Let me thank you once more for the honour you Inrcc done me, and let me assure you that I am, Mr. President, with all respect, Tour sincere Friend, J. ST. LOE STRACHET. CONTENTS PAGE INTRODUCTION ........ ix 1. CAPITAL THH WORKING-MAN'- SKRVER AND HELPER 13 2. THE FORCE THAT MAKE- TFIK WHEELS GO ROUND . 17 3. "Tin; RICHER THE STATB i m. POORER THE PEOPLE" 21 4. IT is IMPOSSIBLE FOR WEALTH TO ACU'MULATI: WITHOUT THE WoRr. BtNE! II I I) M IN PR ACT 10- 32 HI- N A I I' \ A I. W. IRKSH . 36 ~. PHI Si '.IK AND nil-. INDIVIDUAL . . . 8. THK FAMILY ..... . . 46 9. OLD-AGE P 1 Cr iTi.N(r-Oo\vN ScHEM . 50 10. OLD-A(,E P i\ ..... 54 11. STATE FEEDING. OF CHILDRKN AND THE BNDOWM) OF AI'-'IHEKHOOI) ....... 58 12. THE OLD POOR LAW . .... 65 13. THE OLD POOR LAW (continued) . . . 70 14. WHAT is VALUE i . . . / . . -76 15. SWEATING AND A MINIMUM WAGE . .81 16. THE RESERVES OF LABOUR . . 87 17. THE UNEMPLOYED . . . . , . . 91 vii viii PROBLEMS OF SOCIALISM I'.U.K 18. WHAT WILL IT COST? WHERE is THE MONEY TO COME FROM ? -97 19. THRIFT . . . 105 20. NATIONAL AND MUNICIPAL TRADING . f .no 21. THE LESSON OF THE ROMAN EMPIRE . .116 APPENDICES A. To A SOCIALIST FRIEND. . . . 121 B. NATION AI, WORKSHOPS . ... 125 INTRODUCTION THE " Letters to a Working Man " tell their own story, and so require very few words from me by way of introduction. I may perhaps be allowed to mention, however, that the gentle- man to whom they are addressed, Mr. Charles Harvey, lives in Bishops Sutton, a small colliery village in Somersetshire. Though Mr. Harvey worked in the mine as a lad, his present work is in a shop doing a large retail business. I may state that the first two or three of the letters were addressed to Mr. Harvey without thought of publication. Later, it was suggested to me to throw into the form of letters to him matter which I had written elsewhere, and to publish the whole, first in the Spectator and afterwards in book form ; but in putting together such matter I always had the thought of my correspondent in my mind. I should add that in writing to Mr. Harvey as I have written I knew well that I was preaching to the converted, for his views on the problems and perils of Socialism are in close agreement with my own. This fact was illustrated by two very able letters on Socialism contributed by him some eight or nine months ago to the Spectator, though not signed by his ix A 2 x PROBLEMS AND PERILS name letters which deservedly attracted a good deal of attention. I mention these facts as it has been suggested that the letters were not really addressed to a bona Jidc working man. The letter form, when used in dealing with a number of detached points, has its advantages, but there are also certain inherent disadvantages. In the first place, there is the danger of repetition ; and next, there is an equal danger of omitting a good many subjects that ought to have been included. If I tried to sum up the general result of these Letters, it would be to say that they show that the chief peril of Socialism is waste waste both in the moral and in the economic sense. Socialism would not only deteriorate character, but it would lessen product. No man realises more clearly than I do that there are a great many evils in our present system of production and distribution. Still, that system does contrive to provide shelter, clothing, and food for the mass of the people of this country. Can it be said that Socialism would do the same ? I believe it would do nothing of the kind, because the mainspring would have been taken out of the clockwork. Our present organisation does provide an incentive to work. Socialism withdraws that incentive, or rather substitutes the much less powerful incentive of coercion. Till it can be shown that slave labour is as profitable in the economic sense as free labour, and that the order of an official or of OF SOCIALISM xi a committee can compel men to as great activity as that which is shown under our present system, I at any rate shall consider that free exchange holds the field, and will always beat compulsion in the matter of production. But that system which has the greatest product must clearly be the system which will give the best results, and do most to diminish the evils of poverty. The ultimate cause of poverty is scarcity, and the only way to combat scarcity is by increased production. I ought perhaps, before I end this Introduction, to say that, though I have written so strongly against State interference in the matter of the labour of grown men and full citizens, I have no objection whatever to State interference intended to protect women and children, as in our Factory Acts. Women and children are not free industrial agents. They are in a position of dependence, and work can be and is exacted from them by others by those, that is, from whom they derive their subsistence. Therefore the State has not only the right but the duty to see that they are not forced to work unduly by those who stand to them in a position of trusteeship. I know that this view will be challenged as regards women, though no doubt it will be admitted as regards children. Nevertheless, I hold that, owing to physical, social, and moral considerations which I cannot enter into in detail now, women are constantly placed in a position where they may be com- xii PROBLEMS OF SOCIALISM pelled to work under injurious conditions unless the State interferes to protect them.. No doubt the State must not overdo that protection, but some measure of restriction as to hours and conditions of labour is certainly beneficial. I refuse, how- ever, to admit that the protection of women and children from excessive hours of work affords a ground for preventing full-grown men selling their labour at their own price and under their own conditions. My working day is not infre- quently one of twelve hours, and occasionally more. I should regard it as a piece of gross oppression if, owing to a Journalists* Eight Hours Act, I were not allowed to work as long hours as I pleased. That being so, what right have I to assent to the State depriving men in trades in which I am not concerned of their liberty, and of saying to them : " Whether you like it or not, we refuse to allow you to work more than eight hours a day " P In concluding this Introduction I desire to thank the Rev. R. H. Law for allowing me to reprint in an Appendix his spirited verses " To a Socialist Friend." They express most happily the lessons of Freedom and good sense which I have tried to set forth in these pages. J. ST. LOE STRACHEY. Spectator OFFICE, WELLINGTON STREET, STRAND, LONDON, W.C. I CAPITAL THE WORKING MAN'S SERVER AND HELPER DEAR MR. , I like your letter because of its manly tone, and because it shows that you do not make the fatal error of dividing the world into rich and poor, and considering them as if they were different species of animals. That is a mistake which the rich are often accused of making in regard to the poor, but I am afraid it is a mistake which is almost as commonly made by the poor. Yet a little reflection will show that there is no difference of kind whatever, but only one of degree. Society is a slope, and a very gradual slope, and not a series of steps. The man with 2 a week looks upon the man with 1000 a year as a rich man and cut off from him by the fact of those riches. But in reality the ^Tiooo-a- year man is not separated from the working man so much as he is separated from the millionaire with his 100,000 a year. I often laugh at my well-to-do friends and tell them that they need * 13 i 4 PROBLEMS AND PERILS i not imagine that working men arc always think- ing about them or envying them their money. Just as the Duke of Westminster, Mr. Pierpont Morgan, and Mr. Rockefeller are not always in the thoughts of well-to-do or comparatively rich men, so working men are not always grieving that they are not in the ranks of the comparatively rich. At the same time I admit, of course, that when you come to the really poor and where there is actual want, there is a difference not merely in degree but in kind. No man desires the abolition of this form of poverty more than I do. The m<>rc I study the question, however, the more convinced I am that the way to get rid true poverty and to improve the condition of the working classes is not by State action or State- doles, but by increasing the remuneration of labour that is, by increasing wages on the one- hand and luwering prices on the other. What is wanted is to give the working man a greater share in the profits of industry. Now, in my belief, there is only one absolutely certain way of doing this, and that is by increasing the amount of capital in the world. Capital is only of use to its possessor when it can hire itself out and get paid its wages. Capital is, in fact, always trying to earn wages under the name of interest. Now, the lower the wages it is willing to take, the more money it leaves over to be distributed amongst the various forms of labour with which it is bound to i OF SOCIALISM 15 co-operate in the work of production. If there is very little capital in the world and many people competing for it, it can obviously demand a very high wage or rate of interest. If, on the other hand, there is a great quantity of capital trying to get itself hired that is, trying to earn interest it has to be content with a lower remuneration for its services. In other words, the men who do work of all kinds, mental or mechanical, are in the best position when they can go into the market and hire capital cheap to help them in the work of production. What, then, the workers of all kinds should do is to encourage the growth and accumulation of wealth that is, capital in order that they may have a larger supply of this useful servant at their disposal. They want to breed capital just as a farmer wants to breed cows and horses. Yet, strange as it may seem, thousands of working men have convinced themselves that capital is their enemy, and that they must try all they can to destroy it. By furthering Socialistic schemes, by threats of confiscation and of unjust taxation, and by causing a sense of insecurity, which makes people think it will not be worth while to accumulate money because it will be taken away from them by force, working men are, in fact, proposing to reduce the supply of capital in the country. The result must, of course, be a fall in wages. They are trying to kill the cows instead of milking them. 16 PROBLEMS oi ULISM i I, on the other hand, want to see capital accumulating freelv and in large quantities, and ipeting everywhere for labour, and thus raising the labourer's \\'age. Though they so often deny this fact hy their acts, what all labourers, whether with brain or hand, instinctively desire is higher wages. They sometimes indeed overdo this desire, or rather think only of the nominal amount of their wages, l'>rgettinu r that the true way of the value of wages is by considering their purchasing power. The essential thing is to h pital and labour alone. If we do that, I have not the slightest doubt that labour will get USt reward in a greatly increased remuneration. Most of the things that we do nominally to help labour reallv injure it by reducing wages. Aln all Socialistic schemes tend in the end to reduce wages. Thi- .vn in a marked degree in the old Poor Law. In the parishes where out- r relief was given to every one, and where practical! v everybody was a pauperised pensioner of the wages were always found to be at their lowest. I have inflicted a very long letter upon you, I am afraid, but the subject, as you know, is one upon which I feel very strongly. Yours very sincerely, J. ST. L. S. II THE FORCE THAT MAKES THE WHEELS GO ROUND DEAR MR. - , I want to try and put to you yet another series of arguments in regard to Socialism arguments which show, in my opinion, that working men, quite as much as those who are more richly endowed with the world's goods, should not be Socialists. Believe me, it is not be- cause Socialists are innovators or agitators, or preach things contrary to the established order of society, or, indeed, are this or that or the other, that I am opposed to them and their doctrines, but simply and solely because I believe that Socialism is utterly impracticable, and that any attempt to bring -it about must plunge the country into untold misery. Let me try to put my reasons in the simplest form possible, -- the form which is sometimes patronisingly called suitable for children, but which in reality is the form in which every one reasons out a subject in his own mind, the form of question and answer. Should those who desire, above all things, an 1 8 PROBLEMS AND PERILS n improvement in the conditions of the labourer become Socialists ? No. Why not ? Because Socialism, if carried out, would injure instead of benefiting the labourer. Why would Socialism injure the labourer ? the following reason : If the condition of the labourers is to be improved that is, if tlu v are to have more food, more room in their hou more clothes, more tiring, more of everything they desire it is evident that there must be more 1th, for these things make up wealth. But in order that there shall be more, wealth, more of the things men need and de-ire, more mu-t be pro- duced. If ten men have only live loaves between them, and need one each, the only way they can get their wants -at i -lied is somehow or other to get five more loaves. It follows, therefore, that nothing which decreases the total wealth of the world which diminishes the corn grown, the wool clipped, the houses built, the cotton spun, or the coal dug can improve the condition of the poor. If, then, Socialism would diminish the pro- duction of the things needed by mankind, it must be injurious. But would it diminish the wealth of the world, and so make less to go round f Yes. How ? n OF SOCIALISM 19 In this way. The great stimulus to the pro- duction of wealth of all kinds is self-interest. Canadian farmers who increase the wheat-supply of the world by working hard throughout the year do not do so out of a pure and disinterested love of their fellows, but because they want to get rich and be able to spend money in the manner most pleasing to themselves. In the same way, the man who throws up a life of ease and works from morning to night till he has made an inven- tion which will enable the manufacturer to turn out double the amount of, say, woollen cloth without increased expenditure does so because he has the incentive of self-interest before his eyes -the incentive of f knowing that success will be rewarded by $ne fulfilment of his desires. Throughout the world the motive-power of the machinery which produces wealth, the force that makes the wheels go round, is self-interest, not self-interest, remember, in a bad sense, but the natural and legitimate desire for reward and enjoy- ment which we all experience, and which I for one am not in the least ashamed of. Destroy this motive-force, give men no rewards to strive for, and each individual, unless compelled, will do nc5 more than is necessary to keep himself from starvation. But this is exactly what the Socialist intends to do. He proposes to take away the incentive under the influence of which more and more wealth is added to the world's store. The 20 PROBLEMS 01 SOCIALISM n Socialist would confiscate private property, and dole out to each individual a subsistence portion. But in order that there shall he something to dole out, the inhabitants of the Socialistic State will he compelled to work. Compulsion, in a word, will become the ultimate motive-force of the machinery of production under Socialism, just under our present system it is selt- interest. Which is likely to be the more successful : Which will have the larger product : Who is the better workman, the slave or the labourer at weekly wa^esr All experience shows that compul- sion produces the lesser oiuput. Convict labour, c labour, pauper labour, and : labour all the world over mean waste and ineflicien ialism, then, based as it must be on com- pulsion, would diminish the wealth of the world. Hut it the total wealth of the world is diminished there will be less to go round, and therefore the share of each person must be less. That Socialism would injure instead of benefiting the poor. You will never be able to ijivc everv man on a hot day a bigger drink of water if you begin by stopping up the pipe that teeds the cistern. 1 Yours very -i nee rely, J. ST. L. S. 1 r -mart, tin. i '1, and rightly object..-, he will still benefit, though we may be one or two degrees removed from the ^pcctacle of the benefit. That this is so can be proved by following out a transaction in pictures, old plate, or point-lace. A, the rich man, buys a picture by Tintoretto from B for ^Tiooo. No doubt if matters stopped here the labourer would not benefit. But they cannot stop here. Money is like water flux, change, motion is the law of its being. B parts with his picture because he wants the ^Tiooo to spend, and proceeds at once to spend it. He lays his money out in housing him- self better, in buying food and clothing, and in a hundred other ways. But these ways almost all involve the employment of the labourer. In very nearly every case, if we follow money to its ultimate destination, we find that destination to be the employment of labour. But everything iv OF SOCIALISM 29 which tends to the employment of labour benefits the working classes, for it means, as I have said already, competition for their services, and there- fore better remuneration. Hence we may say with confidence that money spent will in one way or other benefit the labourer. No doubt some ways of spending are less wasteful than others, and therefore more beneficial, but this is a question of degree, not of kind. We must next take the case of money saved. If the money made by the rich man is put out to interest, and the interest spent, it is obvious, as I have just shown, that the result will be beneficial to labour. Suppose, however, a case in which money is put out to interest, and that interest is saved, and also the interest of the interest, is such a result of accumulation beneficial to the labourer ? Yes. And for the reason given in Letter I., which I may summarise here. Capital (i.e. mobilised wealth) has its price, just as labour has. If you want capital you must pay the market price for it. But we all know that the more there is of a thing in the market, the more the price tends to fall. Hence the more capital accumulates, the lower its price. But the price of capital is reckoned by the rate per annum at which it can be hired i.e. the rate of interest. Hence the accumulation of capital tends to lower the rate of interest. I'ROi KILS rhis good tor the 1 1- Capital is primarily ; > cm| ' labour. [fa nuinuLu turer desires t< which will give employment to h >rk- is to ol ipital with whu : up Mishm hi- mill at : depends upon tin it IK have to pay for the hire of hi : get it the mill will If, h he has to p : it, the mill . the empluyn ment . C num 1 ;,Mtal hi Hut it has been I I the amimul. \ ealth - :. te of iut ; that iv, ma!-. :tal clu :. It that the limitation of wealth mu-t always in one way or other henetit the labouring I :t will there 'hini which I ougbt to have t>iuheii on, the i where men neith put tin at interest, hut hani. I I W iy be asked, : the lab !v it does not benefit him as long as the hoardi: maintained, but the number of i which hoarding takes place in a civili-ed country is too small to make it worth mentioning. In any iv OF SOCIALISM 31 case, the moment the hoarding ceases and the money is spent or put out at interest the arguments just given apply. What happens when money is in " the stock- ing " is simply this. So much circulating medium N withdrawn from the world and the stock of the metals in use is proportionately reduced. That is the result of hoarding while it 1. Otherwise nobody is either benefited or injured, and things remain as they were. Your- very sincerely, J. Sr. I . S, V Cl \LISM IN PR U 1 h , I h. doubt that you, like ther people who inquire into the ij of Socialism, and who set forth the arguments inst it, arc met with the oh']( V are reasoning. I la\ e you any- thing practkal t sh<>\\ \\h\- Socialism should not be tried ? Thr re SO bad that it i trying any experiment to set them ri^ht." In the hr^t phu I ieny that things ai- bad that they could not be worse, and that any- thing is better than going on as we are. ( forbid that I should deny that there i- a terrible amount of misery in the world, or that I Oiould say a word again-t th..be who are consumed with a passionate longing to make things better. ^ at any rate, know me well enough to believe me when 1 say that if I thought Socialism would cure the ills that make the world so dark, I should be a Socialist to-morrow. I >ppose Socialism, as you know, not because v PROBLEMS OF SOCIALISM 33 I think the present state of things perfect, or even satisfactory, but because I am convinced that Socialism would make things infinitely worse than they are at present, and increase, not relieve, the miseries of the poor. I am no more content than are the Socialists with things as they are, and I most earnestly desire that they should be made better, and would gladly consent to any and every pecuniary sacrifice demanded by the Socialists if I thought that such sacrifices would provide a remedy. When a man is ill the doctor is often urged to try some quack medicine which he knows must make the patient's condition far worse. If he is an honourable and honest man, he will refuse to administer the remedy, however great the pressure put upon him, and however often he is told that the patient prefers to run the risk. Though he may have to admit that the cure he recommends will at the best be slow and painful, and that there is always the possibility that the patient, by refusing to follow his advice thoroughly, will repeatedly lose the ground he has gained and throw himself back into as bad a state as ever, he still refuses to agree to a remedy which must make matters worse. That is exactly the position which those who feel as I do must take up when we are urged to try Socialism as a last chance. Convinced that it is no chance at all, we should be eternally dishonoured if we did not protest U PROBLEMS AND PKRILS x against the pn of those who desire to pt it. No doubt the temptation to shrug one's shoulder^ and let the nation receive the sharp lesson it would certainly receive if it plunged into Socialism is sometimes very great. Never- theless it must be resisted. Tim-, though I have little fear of Socialism hurting me individually, ] though it must deeply wound the poorer part of the community, it is a duty nbat it with all the power at my command. Hut perhaps it will be that here again I am using abstract arguments, and not answering the appeal to practice. I can assure you that I do not dread this appeal. The schemes of the Socialists are not only not new in theory, but have already been tried and found wanting. I admit that the Socialists are entitled to say that never yet has the Socialistic system in it- entirety i applied in ai Ancient or modern, with the possible exception of ancient Peru under the There everything from the land to the domestic animals was held by the State that is, by the Incas and the whole population were State slaves, owning no property, and depending upon the orders of officials for every act of life. But though State Socialism has not been estab- lished in its entirety under modern conditions, Socialistic legislation such as the Socialists now mmend has been adopted, and with the most v OF SOCIALISM 35 disastrous results. Take, for example, the measures which the Socialists now demand for dealing with the unemployed. Their proposal is that the State should undertake to find work for all those who cannot find it for themselves, and to pay for such employment at a rate which will secure a decent living. We who are opposed to Socialism say that the result of such legislation, if persisted in, would be national ruin, and we have a right to say this because we can point to what happened when a similar method of dealing with the un- employed was tried in Paris during the Revolu- tion of 1848, was tried for the same reasons which are now given, and, further, was tried on a large scale and by men who honestly believed in the experiment, and were anxious to make it a success. What the results of that experiment were I will describe in another letter. Yours sincerely, J. ST. L. S. VI THE NATIONAL WORKSHOPS OF 1848 DEAR MR. , I want to state shortly what happened in Paris in 1848. On 25th February 1 848 --just sixty years ago the Provisional Government of the French Republic issued a decree binding itself " to guarantee work to every citizen." On the following day another decree, issued in the name of the French people, ordered the immediate establishment of national work- shops. Here, then, was the " right to work " made part of the law of the land. What was the result ? Complete failure. Let me quote Victor Hugo, an ardent Republican, as a witness to the truth of what I say. In a speech made by him in the National Assembly he used these words : " The national workshops have proved a fatal experiment. The wealthy idler we already know well ; you have created a person a hundred times more dangerous both to himself and others the pauper idler. ... At this very moment England sits smiling by the side of the abyss into which 3 6 vi PROBLEMS OF SOCIALISM 37 France is falling." Hardly less emphatic was the Report of the Commission appointed by the French Government to inquire into the subject. While compelled to recommend the expenditure of further enormous sums of money, it felt bound to admit that the Revolution, by treating the workmen of Paris like spoilt children, had been the cause of a change in their character " which makes every one now dread the excesses of which they may be guilty. " At last the charge of the national workshops on the community, and their failure to do what they set out to do, became so complete that to save the State from bankruptcy they had to be abolished. Naturally the men who had been taught to look to the State, and not to their own exertions, for their living resented the abolition of the "right to work," or rather the right to wages for that is what it had become as unjust, and rose in insurrection, and there were four days and nights of such street-fighting as the world has never seen before or since. Twelve thousand men were killed outright, a number almost as great as that of those who fell at Waterloo. I know, of course, that the Socialists who read this will not admit that the experiment was fairly tried, and will say that it proves nothing. That is the kind of answer often made by men who refuse to admit evidence which is disagreeable to them. They will also probably declare that the 38 PROBLEMS AND PERILS vi great public workshops were organised, not in order to carry out the ideas of Louis Blanc and the Socialists, but with a contrary intent, and in order to ruin his and their influence with the French people. This reading of history I do not admit ; 1 but even if the great national workshops are rejected, I can quote a different experiment tried under different conditions which proved equally disastrous. Louis Blanc, a convinced Socialist and a perfectly honest man, who was one of the members of the Provisional Govern- ment, conducted a special experiment of his own in the matter of national workshops, where it cannot be denied that he had an entirely free hand. He was allowed to organise the tailors of Paris in the Hotel Clichy, which was converted from a debtors' gaol into a great national tailors' shop. As to what happened there I can quote the special correspondent of the Economist newspaper, who, if I mistake not, was Mr. Bagehot, a man of exceptionally clear brain and impartial judgment. He tells us that the experiment began with special advantages. The Government furnished the capital without interest, and gave an order for twenty-five thousand uniforms for the National Guard. Eleven francs for each uniform was the usual contractor's price, a sum found sufficient to provide the profit of the master tailor, remunera- tion for his workshop and tools, interest on his 1 See Appendix B. vi OF SOCIALISM 39 capital, and wages for the workmen. The Government gave the fifteen hundred organised tailors the same price. The Government also agreed to advance every day a sum of two francs for each man as subsistence-money. When the contract was completed the balance was to be paid and equally divided amongst the men. The correspondent of the Economist saw the men at the Hotel Clichy at work, and the foreman told him that, notwithstanding the law limiting the hours of labour to ten, "the principle of glory, love, and fraternity was so strong that the tailors worked twelve and thirteen hours a day, and the same even on Sundays. " One would have imagined that this enthusiasm would have proved quite as great an incentive to work as does self-interest, or, as Professor Smart has pointed out that I ought to say, interest for wife and children. Yet, strange as it may seem, enthusiasm and love of the State could not avail to make the wheels of production go round. When the first order was completed, instead of the Government finding that they had paid eleven francs per uniform, they found that they had paid no less than sixteen francs. While the master tailor would have made a profit, paid his rent, the interest on his capital, wages a good deal higher than two francs a day, and only charged the Government eleven francs, the national work- shops, with all their advantages, had added nearly half as much again to the total cost. The corre- 40 PROBLEMS AND PERILS vi spondent of the Economist ends his account of the experiment with the significant words : " Louis Blanc is not a match for the master tailors of Paris." I am bound to say that the failure here always strikes me as very remarkable. One would have thought that if ever a Socialistic experiment was to succeed, it would have been in Paris in 1848 ; for the whole of the working population was filled with an enthusiasm for Socialistic ideas such as is without parallel even in the history of France. Again, they were making necessary uniforms for the soldiers of the State. Yet even with all these advantages and incentives Socialism could not do as well in the matter of production as the humble and despised principle of voluntary effort. In truth, the history of State-supported labour is the same all the world over. Under the old Poor Law, parish farms, as they were called farms taken by the parishes, in which the unemployed were set to work at a subsistence wage ; in fact, small agricultural experiments in carrying out the Socialist principle of the " right to work " were fairly common in many parts of England. The result of these experiments was almost always the same. The land produced little or nothing, and the workers became rapidly demoralised, and failed to do the amount of work which they would have done under ordinary employment. Perhaps it may be said that I have only given you examples of failure under the "right to work'' vi OF SOCIALISM 41 either in France or two generations ago in England. Very well. I will cite a more modern instance. In 1893 Mr. Shaw Lefevre, as Commissioner for Public Works, arranged to pull down a part of Millbank Prison by means of the unemployed. The report of the surveyor who superintended this work is most significant. When these men worked with the knowledge that their pay would vary according to the work done, they did twice as much as when they knew that whether they worked or idled their pay would be 6^d. an hour. While the cost of cleaning and stacking bricks by the unemployed, acting as the pensioners of the State, averaged from I2S. to 135. a thousand, the same men when employed under a system of piecework managed to earn considerably higher wages than before, although the rate agreed on was only 75. a thousand. Here is the root of the matter. Labour done under the conditions which, however much the Socialists may deny the fact, would be bound to prevail under Socialism is infinitely less productive than labour under the voluntary system. But here we come back once more to the crux. If the product of Socialism is to be so much less, how is it possible that every one is to have more of the good things than they have at present ? Yours very sincerely, J. ST. L. S. B 2 VII THE STATE AND THE INDIVIDUAL DEAR MR. - , I hope you will not suppose, because I offer so strong an opposition to Socialism, that I am an Individualist run mad, and that I think there is no function for the State. Nothing could be farther from my desire than to think meanly of the State, or to hold the foolish heresy that the State has nothing to do but look after our drains, make our roads, and perform a certain number of useful offices of that sort. I believe, instead, that to the State we owe a great devotion, and that Wordsworth was perfectly right when he said that an Englishman should feel towards his country as " a lover or a son/* To my mind, there is no virtue greater that patriotism, nor is any man to be more honoured than he who is willing to sacrifice himself to the good of his country. I want men not to have a parasitic feeling towards the State, or to regard it as something which is bound to shower benefits on them, but 42 vii PROBLEMS OF SOCIALISM 43 rather as something to which they owe a debt of work and devotion, and for which they must do service, in many cases without any thought of reward. As a student and observer of human nature, I am sure you will agree with me that the State that is, our country, our Motherland- will not be less loved because it asks for sacrifices instead of conferring benefits. It is one of the noble paradoxes of human nature that we love best those whom we help and cherish, not those from whom we receive rewards and favours* All experience shows that parents love their children best when those children are weakest and are demanding most from them, not at the time when they expect and are obtaining help from their children. Again, it is notorious that the time when the children are fondest of their parents is when, in the phrase of Pope, they " rock the cradle of declining age," and not when those parents are in health and wealth and vigour, and have no need to lean on their offspring* In the same way, I am sure we shall foster and secure the love of one's country by asking for sacrifices, not by scattering pecuniary doles. Do not think, then, that in opposing further extensions of State action, and in desiring that such action, when necessary, shall be kept within strict bounds and limits, I am aiming a blow at the State. I am helping to establish it on the only firm base. Again, I hope you will not think that 44 PROBLEMS AND PERILS vn I imagine that it is possible in any modern com- munity to do without a good deal of State action. I am fully aware that there are certain things, as, for example, the work of the Post Office, which can best be performed by the State, and also that in a country with a history like England's the State must assume a good deal of responsi- bility for the poor. I fully assent to the proposi- tion that it is the duty of the State to see that no man or woman dies of starvation if it can possibly prevent it. Burke said that he preferred a Monarchy to a Republic, because it was easier to engraft upon a Monarchy the advantages of a Republic than to engraft on a Republic the advantages of a Monarchy. In the same way, I say that, though in the modern State there must be a certain amount of State action, I prefer a State based, in the last resort, upon Individualism to one based upon Socialism, because we can much more easily engraft upon an Individualistic State some of the advantages of Socialism than engraft on a Socialistic State some of the advantages of In- dividualism. Indeed, so absorbing is the nature of Socialism that you cannot in reality engraft any of the advantages of Individualism on a truly Socialistic State. The graft would not prosper, but would wither away. To put the matter into practical shape, I would always rely, where I could, on individual action. vii OF SOCIALISM 45 If, however, in particular cases it can be proved that the public interest can be better served through State action than by leaving it to the individual, then, but only then, let us have recourse to State action. In other words, every Socialistic proposal must be considered on its; merits, adopted if it can be shown to be sound,, but rejected if the case has not been fully made out. You remember the Irishman who said that he had too greajL-a^respect for _the truth to be dragging her out on every paltry occasion. In the same way, I have too great a respect for the State to be bringing it into action for minor and unsuitable considerations. State action must be restricted to great and appropriate occasions. Yours very sincerely, J. ST. L. S. VIII THE FAMILY DEAR MR. - -, Hitherto I have dealt chiefly with the economic side of Socialism. I want now to turn to another aspect. People sometimes talk as if the only object of the Socialists was to destroy private property that is, as if from the Socialist point of view private property were the sole enemy. That is a great mistake. Socialism involves not only the destruction of private property, but quite as certainly the destruction of the family. When I say this, please do not think that I imagine that any great number of Socialists deliberately desire to destroy the family. On the contrary, I am convinced that the majority of them are perfectly sincere when they declare that nothing is farther from their thought, and that they desire and intend, quite as -strongly as their opponents, to maintain the family. Unfortunately, however, mere good intentions are not of very .great service in this matter. What we have to 46 PROBLEMS OF SOCIALISM 47 consider is not what the Socialists intend, but what will be the ultimate result of their system. Now I say unhesitatingly that it is quite im- possible to establish Socialism, or to carry out the schemes which the Socialists tell us are necessary to bring about the reign of Socialism, without the destruction of the family. My first proof of this is that the clearest thinkers among the Socialists of ancient and modern times the men who by the aid of reasoning and analysis have thought out what would happen under Socialism have been obliged to recognise that it could not be maintained with- out the destruction of the family. No human being was ever possessed of a clearer brain than Plato, and no man ever thought a thing out to its final conclusion more clearly or squeezed more thoroughly the intellectual sponge. When he came to set forth his ideal Socialist Republic, Plato saw that the abolition of the family was essential if his State was to have a secure founda- tion. He would not even leave the vestige of a foundation upon which the family might be re-created i^st it should ruin his fabric. The most elaborate precautions are taken in the ideal community whose laws are set forth by Plato that no man shall know his father or his mother, his brothers or his sisters ; and, again, that no father and no mother shall ever know their children. Family ties are to be severed almost from the 48 PROBLEMS AND PERILS vm moment of birth. Aristotle, the other great Greek thinker who followed Plato, noted this fact, and realising how essential it was to blot out the family in order to create a community such as that described in the Republic^ asserted that the whole scheme must fail because it would in fact be found impossible to destroy the family. He somewhat quaintly predicted that owing to family likenesses fathers and mothers would recognise their offspring in the children of the State, and that in the family ties thus based on guesswork would be found the little rift within the lute which would in the end destroy the complicated mechanism of Plato's State. Though Aristotle's criticism was acute and interesting, I am afraid that the family is not quite so hardy a plant as he imagined. The family, or at any rate what is worth preserving in the family, can, I fear, be destroyed far more easily than by the drastic proposals made in the Republic. Even without the obliteration of the knowledge of fatherhood and motherhood which, of course, I fully realise is not now proposed by any Socialist State Socialism may ruin the family past repair. By doing the whole work of the family, and undertaking all but the physical offices of parentage, the State will in fact destroy the family. Those, therefore, who believe the family to be essential to a sound and healthy State must withstand that undermining of the viii OF SOCIALISM 49 family to which Socialism is now unconsciously directing its efforts. Let me ask you to remember that a limb may be destroyed just as well by depriving it of its proper uses as by cutting it off. If you take a man's arm and bind it so tightly that the blood cannot circulate or the muscles be used, you will in a short time destroy it past all repair. The only difference between that and amputation is that the process of destruction is somewhat slower. The attack on the family by the Socialists is at present made up of three different proposals : (i) Old-age pensions ; (2) the State feeding of school- children ; (3) the so-called endowment of mother- hood. These three proposals I propose to discuss in order in future letters. Yours very sincerely, J. ST. L. S. IX OLD-AGE PENSIONS CUTTING-DOWN SCHEMES DEAR MR. , The schemes for old-age pensions assume many forms, but I will deal with what is apparently going to be the basis of the Govern- ment's plan, or at any rate the ultimate outcome of that plan, which is a non-contributory pension of 55. a week for all men and women after sixty- five. The first point to be noted is the cost. Universal old-age pensions of 55. weekly at sixty- five mean an expenditure of thirty millions a year by the State. It is hardly to be wondered at that all except avowed Socialists are appalled by such a figure. In order to avoid a scheme so ruinous as this, great efforts have been made to suggest plans by which the number of pensioners may, to begin with at least, be cut down, while at the same time the universal and non-contribu- tory principles may be maintained in appearance. Which of these cutting-down plans will be adopted by the Government is at present unknown, but 5 ix PROBLEMS OF SOCIALISM 51 I should like to draw your attention to one or two of them to show the tremendous difficulties in which men find themselves when they try to adopt Socialism " on the cheap." One proposal is that no one who now receives a pension of more than i os. a week from the State, or has indeed an income of more than ics. from any source, should be eligible for the new old-age pensions. That is, Civil servants, whether employed by the central or local Government, policemen, soldiers, and sailors in receipt of pensions are to be struck off the list. A moment's reflection must show the extreme injustice of any such scheme. The exist- ing State pensioner will be able to say, and with perfect truth: "It is most unjust to deprive me of the 55. a week which you are giving to persons who have spent their lives in private employ- ment. My pension is in reality not a pension at all, but merely deferred pay. I made a bargain with the State to do work for it, and under that bargain a bit of my wages was to be kept back every week and given to me in the latter part of my life, and after my active work was done. The fact that my pension is really only part of my wages is acknowledged by the Government them- selves, for in most cases it is actually called deferred pay, and in all cases it is deferred pay and nothing else. Look at the cases of my brother Jack and me. He went into private employment and earned far better wages th'an I did, but had * VERS1TY) OF / 52 PROBLEMS AND PERILS ix no promise of a pension. I took lower wages because I was to receive a pension after thirty years' service. Out of his higher wages Jack saved money and invested it in buying two small houses, and he is now getting 26 a year with the money he saved. Yet, now we are both sixty- five, the State is going to give him 55. a week, and going to give me nothing because I was fool enough to leave my savings in the hands of the State, and because my pension is i2s. a week. It is a cruel injustice to me." Another method of cutting down the pension- list is the suggestion that nobody is to have the money unless he or she applies for it every Monday morning in person at the local pension office. It is supposed that these disagreeable conditions will prevent persons in the middle and upper classes from claiming their money. They will not like, it is said, to stand in a line every Monday among their poorer neighbours waiting for their turn at the pension window. Now I venture to say that this plan for cutting down the pension-list will end in^ nothing. It might last for five or six years, but very soon people would begin to say that it was a monstrous shame to expose poor men to the discomfort of asking for their pensions in person, that many of them, old and feeble, had to stand out in the rain, and that therefore they ought to be allowed to send a substitute to fetch the money, or else the Government should send ix OF SOCIALISM 53 it to them by post. But the moment pensions collected by substitutes or sent out by the post are legalised practically everybody would claim his pension. Those who did not want the pensions for themselves would be certain to be besieged by charities and other institutions who would say : "If you will kindly assign to us your old-age pension, we will send a substitute to collect it for you, or receive it for you through the post." As no question of pride would come in here, we may be sure that such appeals would not be made to deaf ears. Well-to-do men would no doubt explain that they did not take the old-age pension for them- selves, but gave it to the parish church or the village hospital, or whatever their pet charity might be. I, for example, should certainly assign my pension to the parish rifle club, if parish rifle clubs are still allowed to exist when I am sixty- five. In any case, the pensions would all be drawn. I must defer to next week an examination of yet another scheme for cutting down the list. Yours very sincerely, J. ST. L. S. X OLD-AGE PENSIONS AGAIN DEAR MR. , Another scheme for cutting down old-age pensions was suggested by the Nation last summer. It is that no man or woman should be allowed to claim his or her old-age pension if he or she is earning 55. a week or over. If they are earning less they are only to be allowed such a pension as would make up their earnings to 55. a week. The object of this proposal is to prevent what otherwise would certainly happen the lowering of wages through old-age pensions. If an old couple, each sixty-five, were together getting i os. a week through pensions and were still active, it is obvious that they could and would be willing to take lower wages than they do now. For example, the man might be willing to work at los. a week, and, though he might be somewhat feeble, it is quite conceivable that an employer might find it worth his while to have two men over sixty-five working in his garden for 54 x PROBLEMS OF SOCIALISM 55 i os. a week each, rather than one able-bodied man at ^Ti a week. According to the Nation's plan, then, idleness would be one of the essential conditions under which men and women would get their old-age pensions. The Nation significantly adds that a somewhat elaborate system of inspection would be necessary to enforce this rule. I certainly think it would. A whole army of inspectors, male and female, would always be looking over hedges or through doors to find out whether old Mr. Brown or old Mrs. Smith were not surreptitiously earning a little money, and if he or she were, would be reporting them to the pension authority and getting them struck off the list. If the old people persisted in claiming their pensions under false declarations, they would, of course, have to be fined or imprisoned for perjury. Though I fully realise the logical necessity for such a proposal, it is to my mind most harsh and odious. We all know how intolerable idleness is to the majority of men and women who have earned their bread by hard work. Unless they are born idlers, they cannot be happy unless they are doing something in their old age. Under the Nation scheme, however, they would either be bribed into an unnatural idleness or else tempted into deceiving the State by false declarations. Depend upon it, a scheme so contrary to human feeling would never stand. In a very short time 'the premium on 56 PROBLEMS AND PERILS x idleness, and the hosts of spies and inspectors trying to find out if old-age pensioners were earning money, would be swept away in a storm of popular indignation. Before I leave the subject I must say a word as to an assertion often made namely, that old-age pensions are a natural and proper charge upon the community, because their recipients have had no chance of making provision for themselves. To this declaration I give the most absolute denial. It is perfectly possible for an ordinary working man to make provision for his old age, and to make it without any intolerable sacrifice. It has been calculated that any working man who so desires may obtain an old-age benefit of 55. a week at sixty-five in a Provident Society if from the age of twenty-one to sixty-five he makes a payment of 2^d. a week. That is, if on one day in the week he will give up, say, a pint of beer he may make provision for his old age. I note also that it was stated last summer by the permanent secretary at a meeting of the Ancient Order of Foresters that the extra contribution in the Foresters required to give 55. a week at seventy would be only f d. a week beginning at eighteen years, id. at twenty- four, and i ^d. at twenty-eight. That, I think, is a sufficient answer to the objection I have noted. I may add, however, that actual instances can be cited where even the most poorly paid men in the country that is, agricultural labourers have x OF SOCIALISM 57 provided themselves, notably in the Dunmow Friendly Society, with old-age pensions purely through their own efforts and without any Government help. Do not think, because I write strongly against State-provided, non-contributory old-age pensions, that I do not realise the benefits obtained through old-age pensions. I should like to see all men and women past sixty -five in possession of a pension. But I hold that they should provide it for themselves, and that we must not place this staggering burden on the State. I should not, again, object to a well-devised scheme of com- pulsory insurance against old age. What I protest against is imposing on the taxpayer a burden which will ultimately reach 30,000,000 a year. Remember, the taxpayer on whom the chief burden of taxation falls is always the working man. Yours very sincerely, J. ST. L. S. XI STATE FEEDING OF CHILDK LND HI I DOWMENT OF MOTHERHOOD x MR.- , The next point in the attack on the family with which I want to deal is the feeding of school-children. I am sure that the universal feeding of school-children, advocated by the Socialists, and also by many well-meaning but uninstructed philanthropists, would be to open an academy of pauperism in every elcmen: school in the country. Superficially, no doubt, a certain case can be made out for feeding school- children. What is the use, it is said, of pouring knowledge into the brains of children who are so weak from want of food that they are totally unfit to make the mental exertion required of them by their teachers ? It is mere waste of money to teach starving boys and girls. Therefore, in order not to thro\v away the expensive lessons provided by the State, the State must feed the children, and so make them capable of taking advantage of the education it provides. In theory, 58 xi PROBLEMS OF SOCIALISM 59 as I have said, this is well enough. No man can help being deeply moved by the idea of small children trying to work when weak and faint from want of nourishment, and I, and all other anti- Socialists of whom I have ever heard, would be perfectly willing, in the case of children who are starving and whose parents are unable to provide them with food, to give the necessary food. When, however, we study the facts at first hand, we find that the proposition is not, in fact, pre- sented to us in this way. The really starving children are already provided for by the existing Poor Law. There are, of course, besides, a certain number of children who are neglected by parents who are perfectly well able to feed them. But here the remedy is not for the State to feed the children, but for the State to force the parents to do their duty. I have not only no objection to all parents guilty of such gross misconduct being prosecuted and severely punished for neglecting to keep their children properly fed and clothed, but should immensely like to see them suffer for their crime, for it is nothing less. I should like to quote some facts to show you how absurd it is to imagine that the teachers are competent to look round the benches at a school and, when certain of the children are seen to look ill and badly nourished, to assume that their parents are unable to feed them. A year or two ago, the Education Committee' of the Board of 60 PROBLEMS AND PERILS xi Guardians of the city of Leeds received from the teachers in the elementary schools the names of three thousand children who were declared to be underfed. Thirteen hundred and forty-seven of the children on this list were accordingly visited by special officers of the Guardians in order to ascertain the facts. After carefully considering the reports, the Committee decided that six hundred and ninety of these were "No case" were, that is, not the children of parents too poor to feed them. The decisions were based on facts such as are exemplified in the following three cases : (a) Man, wife, and two children. Teacher's re- port : "Temporarily incapacitated from feeding children." Officer's report : " Man earning regular wage, i : 135. ; wife, a weaver, earning i6s. ; total, 2:95. Man in Engineers' Society and lodge." (/>) Man, wife, and four children. Teacher's report : " Temporarily incapacitated." Officer's report : " Man's regular wage, 3 : los. ; daughter earning i8s. ; total, 4 : 8s." (<:) Man, wife, and six children. Teacher's report : " Apparently urgent." Officer's report : " Man employed by Corporation at regular wage, i : i8s. ; son and two daughters earning 19$. ; total, 2 : 175. Man in lodges and trade society ; children well fed ; home clean ; exceptionally thrifty parents and contrivers." Remember this is by no means an exceptional experience. Boards of Guardians in other parts of the country have made similar inquiries with similar results. But if in spite of these warnings xi OF SOCIALISM 61 we insist upon feeding all school-children, or even all school-children who look badly fed and whose parents we guess to be destitute, we shall very soon create plenty of bona fide cases where the parents are unable to feed the children. Let us never forget that one of the reasons which make men and women overcome their natural desire for idleness is their determination to provide for their children. The love of their children and the duty of feeding them act as incentives not only to work and thrift, but to morality and self- restraint. I can best illustrate the injury done to the family and family life by free meals to school- children by quoting an authentic story which I have quoted on several occasions before. A widow in an East End parish said to the vicar's wife : " I'm glad, ma'am, that this free feedin' of school- children didn't come in till mine was grown up." The clergyman's wife, somewhat surprised by this remark, asked for an explanation. " Well, ma'am, you see it's this way. My husband was a drinkin' man, but he was very fond of the children, and if it hadn't been that he was obliged to find something for them he'd have been ten times worse than he was." In other words, the wife, although no social philosopher and no political economist, had realised the enormous in- fluence of responsibility for the family in keeping the husband within the bounds of social duty, 62 PROBLEMS AND PERILS xi and in preventing him from returning to that brutish isolation from which the institution of the family has, with such pain and difficulty, rescued mankind. Mrs. Bosanquet, whose name must be honoured wherever men are gathered together determined to maintain the strength of the people and to resist attacks upon the family, has told another story which illustrates the tremendous influence exercised by family ties, and shows how unwise are those who, by schemes for feeding children, endowing motherhood, and relieving children of the care of aged parents, would deprive the institu- tion of all its work. She tells us that while talking to a mother apparently terribly hindered in her work by the children who clung to her skirts, the remark came naturally : " They must hinder your work very much ? " " I'd never get through my work without them," was the instant rejoinder. Here again that which made the woman a self-respecting member, or perhaps I should say the essential pillar, of society was a deep sense of the sacredness of family life. Let no one suppose that State action will provide springs of life so strong and so ennobling as these. If neither father nor mother is to feel any necessity to feed their children, what sort of citizens are we likely to get ? Miss Loane in one of her admirable books partly answers this cjues- XI OF SOCIALISM 63 tion when she records a conversation between two women, one of whom was remonstrating with the other for the neglect of her children. The mother arraigned for neglect over the garden wall clinched the argument by screaming out : " As long as the Salvation Army '11 feed my children, I won't." I come next to the proposals for the endow- ment of motherhood. The plait proposed by that eminent Socialist, Mr. Sidney Webb, is for the State to give as it were a capitation -grant for children, while the mothers are to be helped in their hour of need by a handsome contribution by the State. Here again at first sight nothing would seem more reasonable or a better object for State aid. I, at any rate, should feel immensely attracted towards the scheme if we could help the mothers without pauperising the fathers. Un- fortunately, however, it is impossible for the State to shower its bounty upon mothers without taking away from the husbands and fathers responsi- bilities which it is for their good and for the good of the State should be maintained. The fact that a man has to work to keep his wife, and to provide her with comforts during her confine- ment, and that he has also to provide for the young and helpless child in its mother's arms, has upon the father the most beneficial effect. Once teach him, however, that this is not his business, and that the State will look after his wife 64 PROBLEMS OF SOCIALISM xi and his children, and he becomes a demoralised man. The endowment of motherhood, in a word, though it sounds so kindly a proposal, means merely relieving the man of duties which it is immensely to his advantage to carry out. A man prospers morally, not through the duties he avoids, but through those he performs. I know you are a reader of Kipling. Do you remember the striking poem about the Kaiser's Rescript, and the discussion of the proposal that all nations should agree to a law preventing any man from working for more than eight hours a day ? When an English working man speaks at the Conference, this is what he says : And a British delegate thundered : " The halt and the lame be blowed, I've a crib in the South- West workshops, and a home in the Wandsworth Road ; And till the 'Sociation has footed my burial bill I'll work for the kids and the missis. Pull up ? I'll be damned if I will." That is the true spirit. That is what makes the nation strong. But be sure that spirit will not last if we tell men that they need not endow motherhood, but that the State will do it for them. Yours very sincerely, J. ST. L. S. XII THE OLD POOR LAW DEAR MR. - , I want to draw your attention to a fact too often forgotten. It is that we have tried, and tried very thoroughly, a system of State Socialism in England, and that it was a complete and disastrous failure. Under the old Poor Law, or let us say the latest developments of the old Poor Law, which existed roughly between the years 1800 and 1834, we had experience of an almost complete Socialistic system. The inhabitants of a parish till 1834 had an absolute claim upon the community for their support. Every man and woman in a parish could sing the pauper's song : Then drive away sorrow and banish all care, For the State it is bound to maintain us. There was State endowment for the old, State endowment for the unemployed, and State endow- ment for motherhood. The more children a woman had, whether born in wedlock or not, the more she received at the hands of the State. The begetting of the children was, as it were, the only 65 c 66 PROBLEMS AND PERILS xn function left to the father. Unless the father was particularly anxious to sacrifice himself to his offspring, his duties were performed by the com- munity, with the result that there was a frightful increase in illegitimate births. Nothing comes out more strongly in that wonderful book, the Report of the Poor Law Commission of 1834, than the destruction of family life and family ties which was accomplished by the indiscriminate Poor Law relief of those days. I had best, however, quote the actual words of a notable passage in the Report of the Commissioners which deals with the appalling effect on family life and family feeling caused by indiscriminate poor relief: The worst results [of the old Poor Law system of indis- criminate outdoor relief], however, are still to be mentioned. In all ranks of society the great sources of happiness and virtue are the domestic affections, and this is particularly the case among those who have so few resources as the labouring classes. Now, pauperism seems to be an engine for the purpose of disconnecting each member of a family from all the others ; of reducing all to the state of domesticated animals, fed, lodged, and provided for by the parish, without mutual dependence or mutual interest. " The effect of allowance/* says Mr. Stuart, " is to weaken, if not to destroy, all the ties of affection between parent and child. Whenever a lad comes to earn wages, or to receive parish relief on his own account (and this, we must recollect, is at the age of fourteen), although he may continue to lodge with his parents, he does not throw his money into a common purse and board with them, but buys his own loaf and piece of bacon, which XII OF SOCIALISM 67 he devours alone. The most disgraceful quarrels arise from mutual accusations of theft ; and as the child knows that he has been nurtured at the expense of the parish, he has no filial attachment to his parents. The circumstances of the pauper stand in an inverted relation to those of every other rank in society. Instead of a family being a source of care, anxiety, and expense, for which he hopes to be rewarded by the filial return of assistance and support when they grow up, there is no period in his life in which he tastes less of solicitude, or in which he has the means of obtaining all the necessaries of life in greater abundance ; but as he is always sure of maintenance, it is in general the practice to enjoy life when he can, and no thought is taken for the morrow. Those parents who are thoroughly degraded and demoralised by the effects of ' allowance ' not only take no means to train up their children to habits of industry, but do their utmost to prevent their obtaining employment, lest it should come to the knowledge of the parish officers, and be laid hold of for the purpose of taking away the allowance." Mr. Majendie states that Tit Thaxted mothers and children will not nurse each other in sickness unless they are paid for it. Mr. Power mentions the following circumstance as having occurred at Over, Cambridgeshire, a few days before his visit : " A widow with two children had been in the receipt of 35. a week from the parish. She was enabled by this allowance and her own earnings to live very comfortably. She married a butcher. The allowance was continued. But the butcher and his bride came to the overseer and said, ' They were not going to keep those children for 33. a week, and that if a further allowance was not made they should turn them out of doors and throw them on the parish altogether/ The overseer resisted. The butcher appealed to the bench, who recommended him to make the best arrangement he could, as the parish was obliged to support the children." 68 PROBLEMS AND PERILS xii " Those whose minds," say Messrs. Wrottesley and Cameron, " have been moulded by the operation of the Poor Laws appear not to have the slightest scruple in asking to be paid for the performance of those domestic duties which the most brutal savages are in general willing to render gratuitously to their own kindred. ' Why should I tend my sick and aged parents, when the parish is bound to do it ? Or if I do perform the service, why should I excuse the parish, which is bound to pay C 'A. 5 " for it r " At the time of my journey," says Mr. Cowell, " the acquaintance I had with the practical operation of the Poor Laws led me to suppose that the pressure of the sum annually raised upon the ratepayers, and its progres- sive increase, constituted the main inconvenience of the Poor Law system. The experience of a very few weeks served to convince me that this evil, however great, sinks into insignificance when compared with the dreadful effects which the system produces on the morals and happiness of the lower orders. It is as difficult to convey to the mind of the reader a true and faithful impression of the intensity and malignancy of the evil in this point of view, as it is by any description, however vivid, to give an adequate idea of the horrors of a shipwreck or a pestilence. A person must converse with paupers, must enter workhouses, and examine the inmates^ must attend at the parish pay-table, before he can form a just conception of the moral debasement which is the offspring of the present system ; he must hear the pauper threaten to abandon his wife and family unless more money is allowed him threaten to abandon an aged bedridden mother, to turn her out of his house and lay her down at the overseer s door, unless he is paid for giving her shelter ; he must hear parents threatening to follow the same course with regard to their sick children ; he must see mothers coming to receive the reward of their daughters ignominy, and witness women in cottages quietly pointing out, without even xii OF SOCIALISM 69 the question being asked, which are their children by their husband and which by -other men previous to marriage ; and when he finds that he can scarcely step into a town or parish in any county without meeting with some instance or other of this character he will no longer consider the pecuniary pressure on the ratepayer as the first in the class of evils which the Poor Laws have entailed upon the community'' I mean in another letter to give you some further proof from the Report of 1834 of the terrible evils caused by the Socialism of the old Poor Law. Yours very sincerely, J. ST. L. S. XIII THE OLD POOR LAW (continued) DEAR MR. - , Another method of estimating the demoralisation caused by the absolute right to relief conferred by the old Poor Law is to be found in noting the difference between the independent labourers, as they were called, and the labourers who had a right to parish relief. As you perhaps know, a man could only claim relief from his own parish. In order to make good that claim he had to show that he possessed what was called a settle- ment in the parish. A certain number of men, from various causes, such as having gone to other parts of England, lost their settlement, and so their claim upon any particular parish. They had therefore to rely upon their own efforts. The difference between such men and those who possessed the indefeasible right to relief was enormous. Several witnesses before the Poor Law Commission of 1834 declared that they could tell those who were called independent labourers by the mere look on their faces, by the appearance of 70 xiii PROBLEMS OF SOCIALISM 71 their families, or even by their houses a striking illustration of Gray's famous line And read their history in a nation's eyes. Here is a striking piece of evidence compar- ing the independent labourers and the able-bodied paupers : " Have you ever compared the condition of the able- bodied pauper with the condition of the independent labourer ? " u Yes. I have lately inquired into various cases of the labouring poor who receive parish relief ; and, being perfectly acquainted with the cases of paupers generally, the contrast struck me forcibly. In the pauper's habitation you will find a strange show of misery and wretchedness ; and those little articles of furniture which might by the least exertion imaginable wear an appearance of comfort are turned, as it were intentionally, the ugliest side outward. The children are dirty, and appear to be under no control. The clothes of both parents and children, in nine cases out of ten, are ragged, but evidently are so for the lack of the least attempt to make them otherwise ; for I have very rarely found the clothes of a pauper with a patch put or a seam made upon them since new. Their mode of living, in all cases that I have known (except and always making the distinction between the determined pauper and the infirm and deserving poor, which cases are but comparatively few), is most improvident. It is diffi- cult to get to a knowledge of particulars in their cases ; but whatever provisions I have found, on visiting their habitations, have been of the best quality ; and my inquiries among tradesmen, as butchers, chandlers, shopkeepers, etc., have all been answered with : ' They will not have anything but the best.' " In the habitation of the labouring man who receives no parish relief you will find (I have done so) even in the 72 PROBLEMS AND PERILS xm poorest an appearance of comfort ; the articles of furniture, few and humble though they may be, have their best side seen, are arranged in something like order, and so as to produce the best appearance of which they are capable. The children appear under parental control ; are sent to school (if of that age) ; their clothes you will find patched and taken care of so as to make them wear as long a time as possible. There is a sense of moral feeling and moral dignity easily discerned. They purchase such food, and at such seasons, and in such quantities, as the most economical would approve of." Another writer, Mr Isaac Willis, collector of the Poor-rates in the parish of St. Mary, Stratford- le-Bow, London, spoke to the same effect : " Are the two classes externally distinguishable in their persons, houses, or behaviour?" "Yes, they are. I can easily distinguish them, and I think they might be distinguished by any one who paid attention to them. The independent labourer is comparatively clean in his person, his wife and children are clean, and the children go to school ; the house is in better order and more cleanly. Those who depend on parish relief or on bene- factions, on the contrary, are dirty in their persons and slothful in their habits ; the children are allowed to go about the streets in a vagrant condition. The industrious labourers get their children out to service early. The pauper and charity-fed people do not care what becomes of their children. The man who earns his penny is always a better man in every way than the man who begs it." Another London witness, Mr. Samuel Miller, assistant - overseer of St. Sepulchre's, London, testified as follows : " In the course of my visits to the residences of the xin OF SOCIALISM 73 labouring people in our own and other parishes I have seen the apartments of those who remained independent, though they had no apparent means of getting more than those who were receiving relief from the parish, or so much as outdoor paupers. The difference in their appear- ance is most striking ; I now almost immediately, on the sight of a room, can tell whether it is the room of a pauper or of an independent labourer. I have frequently said to the wife of an independent labourer, ' I can see by the neatness and cleanness of your place that you receive no relief from any parish.' ' No/ they usually say, * and I hope we never shall.' This is applicable not only to the paupers in the Metropolis, but it may be stated, from all I have seen elsewhere, and heard, that it is equally applicable to other places. The quantity of relief given to the paupers makes no difference with them as to cleanliness or comfort ; in many instances very much the contrary. More money only produces more drunkenness. We have had frequent instances of persons being deprived of parochial relief from misconduct or otherwise, or, as the officers call it, * choked off the parish,' during twelve months or more, and at the end of that time we have found them in a better condition than when they were receiving weekly relief." I cannot, unfortunately, find space to give all the illustrations of the terrible demoralisation brought about by the old Poor Law which the Report contains. Before I leave the subject, how- ever, I should like to quote the introductory paragraph which deals with the effects of the old Poor Law system on those not actually relieved We have seen that one of the objects attempted by the present [1834] administration of the Poor Laws is to repeal />n? tanto that law of nature by 'which the effects of C 2 74 PROBLEMS AND PERILS xm each man's improvidence or misconduct are borne by him- self and his family. The effect of that attempt has been to repeal pro tanto the law by which each man and his family enjoy the benefit of his own prudence and virtue. In abolishing -punishment we equally abolish reward. Under the operation of the scale system the system which directs the overseers to regulate the incomes of the labourers according to their families idleness, improvi- dence, or extravagance occasions no loss, and consequently diligence and economy can afford no gain. But to say merely that these virtues afford no gain is an inadequate expression ; they are often the causes of absolute loss. We have seen that in many places the income derived from the parish for easy or nominal work, or, as it is most significantly termed, " in lieu of labour," actually exceeds that of the independent labourer ; and even in those cases in which the relief-money only equals, or nearly approaches, the average rate of wages it is often better worth having, as the pauper requires less expensive diet and clothing than the hard-working man. In such places a man who does not possess either some property or an amount of skill which will ensure to him more than the average rate of wages is, of course, a loser by preserving his independence. Even if he have some property, he is a loser, unless the aggregate of the income which it affords and of his wages equals what he would receive as a pauper. It appears, accordingly, that when a parish has become pauperised the labourers are not only prodigal of their earnings, not only avoid accumulation, but even dispose of, and waste in debauchery, as soon as their families entitle them to allowance, any small properties which may have devolved on them, or which they may have saved in happier times. Self-respect, however, is not yet so utterly destroyed among the English peasantry as to make this universal. Men are still to be found who would rather derive a smaller income from their own funds and their xiii OF SOCIALISM 75 own exertions than beg a larger one from the parish. And in those cases in which the labourer's property is so considerable as to produce, when joined to his wages, an income exceeding parish pay, or the aggregate of wages and allowance, it is obviously his interest to remain independent. Will it be believed that such is not merely the cruelty, but the folly of the ratepayers in many places that they prohibit this conduct that they conspire to deny the man who, in defiance of the examples of all around him, has dared to save, and attempts to keep his savings, the permission to work for .his bread ? Such a statement appears so monstrous that we will substantiate it by some extracts from our evidence. I feel sure that you will realise the importance of the extracts I have given from the Report of 1834, and I hope that you and all others who are studying the subject of Socialism will read that Report in detail. It is a book of no very great dimensions, and can be bought for the price of is. 8d., either from the Government printers, Messrs. Wyman and Sons, or through any book- seller. Yours very sincerely, J. ST. L. S. XIV WHAT IS VALUE? DEAR MR. - , I hope when thinking about Socialism and discussing it with your friends that you will never let yourself be frightened or put off by the technical language of political economy, or be driven from what seems to you a sound view because this or that great name is brought up against you and you are told that what seems to you common-sense is contrary to Mr. So-and- so's theory or statement. Political economy or Economics is the science of exchange, and though the tree may be very complicated at the top, with an enormous number of interlacing branches, it has only one stem, and that is the true and just definition of value, or rather exchange value. I say " exchange value " instead of simply " value " to prevent confusion. People are apt to use " value " as if it were the same as " usefulness." Exchange value means not only usefulness, but the quality of being exchangeable the quality 76 xiv PROBLEMS OF SOCIALISM 77 which makes people willing to give something in exchange for an object. If men would only keep a clear understanding in their minds of what exchange value is, and how it arises, they would find economics very greatly simplified, and we should see very many paradoxes and false theories now flourishing wither away. People sometimes talk as if exchange value can belong to a thing because it has had labour expended on it, or, as they put it, that labour is the sole cause of value, and therefore of wealth. It is, indeed, on the assertion that the sole cause of value is labour that the whole of modern Socialism was built up by Marx. Though I believe some of the modern Socialists declare that they do not hold with the Marxian definition of value in this absolute form, they in fact still base all their theories upon it. A moment's thought will show how untrue is this definition. Suppose you take a hard and ugly block of stone and hire two or three men to carve it and bore holes through it in various ways. Next, suppose that these men hew it and hack it so much that it ceases to have any strength as a block of stone, while at the same time, as might easily be the case, acquiring no artistic beauty whatever. Some 20 or 30 worth of labour might have been put into the stone, and yet it would have no exchange value whatever, but might very well be worthless* except as broken 78 PROBLEMS AND PERILS xiv stone. Clearly here labour would not have been the source of value. It is also not possible to say that a thing has value because it has utility because, that is, people want it. Sea-water has utility, for it can be made into salt, and it is therefore in demand, and yet on the seashore, where any amount of it can be obtained, it has no exchange value. What is wanted to give exchange value to an article is the presence of two things demand and the limitation of supply, or, in other words, demand and a certain amount of scarcity. These two requisities are like the two poles in electricity. When they are brought together, but only then, the electric spark of exchange value is produced. Test this rule in any case you like, and you will find that it is always true. There is always a demand for drinking-water among human beings. But it has no exchange value unless there is a limitation in the supply that is, scarcity. Men will pay nothing for water if they are living on the shores of a lake, and can get it with perfect ease. When, however, they are away from the shores of the lake, and the water has to be brought to them in pipes i.e. when it has become limited in supply it has an exchange value, and men will give other things for it. The same may be said of fresh air. Here you see that demand alone everybody demands air and water does not give exchange value. In the same way, limitation of xiv OF SOCIALISM 79 supply mere scarcity will not give exchange value alone. There are a certain number, though a very small number, of pebbles on the seashore of an ounce in weight in other words, there is a limitation of supply in the matter of pebbles of an ounce in weight. Since, however, there is no demand for them, their scarcity alone does not give them value. Suppose, however, that pebbles weighing an ounce each were urgently needed in considerable quantities, for some purpose or other. Then at once such pebbles would have an exchange value, because the two things would have come together demand and limitation of supply. Perhaps the clearest way to put the matter is this. Demand is the first essential for value, because unless somebody wants a thing nobody is going to offer anything in exchange for it. The next essential is that it shall be limited in supply, because, again, nobody is going to give anything in exchange for something which, owing to the fact that it is unlimited in supply, he can get for himself for nothing. But value varies very greatly in degree accord- ing to the proportion between demand and supply. The price, that is, is constantly changing. Here the old rhyme will help us : The real worth of anything Is just as much as it will bring. You cannot get beyond that . piece of ancient 8o PROBLEMS OF SOCIALISM xiv wisdom as to the determination of value. The degree of value or price of a particular object can only be ascertained by finding out what people will give for it. Their conduct here is governed by the proportion between demand and supply. Let me say again that if you keep this simple theory of value clear in your mind, you will find it a sure guide through the labyrinth of political economy. Whenever you find a theory propounded by an economist, no matter how distinguished, which contradicts these plain facts as to exchange value, you may be sure it is wrong. Yours very sincerely, J.'Sx. L. S. XV SWEATING AND A MINIMUM WAGE DEAR MR. , No one can feel more strongly than I do the sense of pity and regret that men and women should often labour so hard and under such miserable conditions for so wretched a wage. If we could really put an end to the evils of sweating and free the tired sempstress from her unrequited toil by an Act of Parliament, I should deem no sacrifice too great, except the fool's sacrifice under which one evil is abolished by calling a greater evil into existence, or no remedy at all is found, but only the name of the evil is changed. Unfortunately it is such means that the House of Commons lately declared its willing- ness to adopt in a fit of futile sentimentality. Members vied with each other in their eagerness to prescribe quack remedies for the evil remedies which would either do no good or render the disease worse than ever and refused to face the consequences of their action. We all know the mood of the coachman who, when he has lost 82 PROBLEMS AND PERILS xv his way, whips up his horses and drives on, any- how and anywhere, in a panic, feeling that if he only goes somewhere fast enough he will get out of his troubles. He forgets that as likely as not he is only getting farther and farther away from his true goal. Let me give you an example of the unwilling- ness of the Commons to look the facts in the face or to realise the consequences of their proposal. Practically all the speakers in the debate admitted that the question of sweating was really part of the question of unemployment. Yet they deliberately sanctioned a measure the effect of which must be to increase unemployment. If a minimum wage is fixed, it is certain that a great many people now employed at less than that wage will be thrown out of employment, and thus we shall add to the unemployed, many of whom notoriously are unwilling to work, a body of men and women who at any rate are willing to work, but whom the State will not allow to work at the wages at which work can be obtained by them. This result of fixing a minimum wage was well brought out by Judge Backhouse, a judge appointed by the New South Wales Government to inquire into the working of the minimum-wage law in Victoria. The Judge pointed out how the result had been to drive out of employment many of those who were previously at work, or else to cause evasions of xv OF SOCIALISM 83 the law. " To the man who is merely slow the law shows no mercy. If he cannot earn the minimum wage, he must not work at all." It will no doubt be urged against the view I am taking that I have nothing practical to propose to meet the evils of sweating, and I shall be asked with rhetorical emphasis whether I am really content that " The Song of the Shirt " shall be sung in thousands of miserable homes or sweaters' dens in order that the sacred principles of political economy shall not be infringed. My answer is that though I have no ready-made remedy for sweating, I am not willing to pretend that I have a remedy when I have not, or to support a measure which I know will increase the evils complained of merely on the ground that I am doing something to ease the national conscience. If the " national conscience " de- mands an active poison rather than endurance of suffering, however poignant, then the " national conscience " is a false guide. But though I have no immediate remedy to propose, I am by no means unable to indicate some of the causes that have brought about the evils of sweating. These are the causes that produce unemployment and pauperism in their various forms. To put the matter shortly, we must endeavour to stop sweating by stopping the manufacture of the unemployed and of pauperised persons. One of the chief engines of this manufacture is the 84 PROBLEMS AND PERILS xv maladministration of the Poor Law. The next is the special provision which of late years we have made for the unemployed. By recent legislation we have rendered it easy to be un- employed. In a word, the State is discovering that it can have just as many unemployed as it likes to pay for. It learnt this fact once before in the years between 1790 and 1830 and in 1834 it realised that it must stop the manufacture of unemployed or be ruined. Now, apparently, it has forgotten, and will have to learn its lesson again. Another source of unemployment is to be found in those Trade-Union regulations under which the natural grading of the pay of labour according to its efficiency is not permitted. Of this cause we have no right to complain, for the action of the Trade-Unions is voluntary, and the State cannot and ought not to interfere. It ought not, however, to make the anti-grading policy of the Trade-Unions easier by, in effect, declaring that it will provide subsistence under the name of unemployed allowances for the men who are thrown out of employment by Trade- Union action. A last and final source of unemployment, and therefore of sweating, is, I believe, to be found in the tremendous pressure of our taxes and our rates on the poor. It is popular just now to regard high rates and high taxes as things almost xv OF SOCIALISM 85 beneficial, but in reality they are bound to bring with them very great evils. While we have been taxing and rating people nominally in the interests of the working class and in order to carry out so-called social reforms, we have really been depressing the condition of the poorest part of the nation. Remember it is on the man who has his back to the brick wall of absolute poverty, and who has no elbow-room in which to adjust his economic conditions, that the ultimate pressure of our public burdens falls. That it falls indirectly does not make the pressure less onerous. In these days he who suggests freedom as a remedy for a social evil must expect to be treated with hatred, ridicule, and contempt, and held up as one who by his nature is half idiot and half tyrant. Nevertheless, I venture to say that by an application of the principles of free contract, and by such application alone, will a radical remedy be found for the evils of sweating. Restriction can do no permanent good, partly because it is bound to limit production and increased production is the only means by which higher wages can be obtained and partly because it is bound to carry with it that State aid which throws more burdens upon the people, and brings more and more of the industrious poor across the line which separates them from the pauper class. If the State forbids a man to take less than a certain wage, and he cannot get that wage, 86 PROBLEMS OF SOCIALISM xv the State has to support him. But the State is, after all, only the working men with an orna- mental fringe of capitalists at the top. Therefore what the State is really doing is decreasing the production of the things men desire, with the hope that thereby it will be able to give them more of those things ! One word more before I leave the subject. Though I hold that in freedom will be found the economic remedy, I by no means shut out the moral remedy. On the contrary, I believe that the moral remedy is all-important, and that those noble souls who are helping the poor* to help themselves are doing infinitely better and kindlier work than those who vote for quack medicines. Again, I by no means desire to rule out the attack on sweating from the sanitary side. If, and when, the conditions under which men and women are working are found to be insanitary and likely to lead to disease, then let the law interfere and refuse to allow those insanitary conditions to prevail. Work under insanitary conditions is waste of the human and of the material product in the highest degree, and the State is well advised to prevent such waste. Yours very sincerely, J. ST. L. S. XVI THE RESERVES OF LABOUR DEAR MR. - , Mr. Ramsay Macdonald in the course of his speech on the Unemployed Bill declared that all economists and sociological investigators in the country, with Mr. Charles Booth at their head, had laid it down that modern industry demanded a surplus of labour in order to carry it on. He wanted to supplement that by another doctrine that modern industry not only required a steady surplusage of labour, which might become a minimum, but also requires now and again a critical condition of unemployment. " It not only required its two per cent always, but its ten per cent occasionally. If they agreed with that, there was an inevitable corollary. If we were to have unemployed, not because the men were inferior to the employed, but because of the very nature of the organisation, it was a logical and humane corollary that the burden of unemployment should not be placed on the backs of these weak men, should not be left to charity or to odds and ends of ill-assorted 87 88 PROBLEMS AND PERILS xvi legislation, but should be dealt with more and more on the lines of Clause III. of the present Bill." In other words, Mr. Ramsay Macdonald asserts that modern industry requires certain reserves of labour which can be brought up at moments of stress, and that the unemployed constitute these reserves. With certain limitations, I agree. But if these reserves are necessary to industry, let the cost of supplying them fall upon the industry, and not upon the State. Why should the taxpayers and ratepayers pay to keep during certain months of the year men who will be wanted by Messrs. Brown and Smith in order to get their firm very lucrative orders at another portion of the year ? No doubt many owners of factories would be in very great difficulties if they could not feel that when large orders came their way they would find a sufficient body of men to help them to carry out those orders. Heretofore, or rather before the great extension of doles to the unemployed, many firms felt this so strongly that in slack periods they took orders at very low rates rates which gave them no profit, or which even constituted a loss in order to keep their body of operatives together. They recognised the need of maintaining reserves which can be drawn upon when large orders are coming in at high rates. Here is a good example of the compensating balance in industrial life. xvi OF SOCIALISM 89 Now, however, the capitalists are beginning to realise that there is little or no risk of their reserves of labour being lost if they do not keep them together by occasionally running their works without a profit. In future the reserves, instead of going elsewhere or melting away, will be kept in being for the good of the manufacturers by the State or the municipality. The onus of maintaining its own reserves is no longer imposed on the industry. The ratepayer and the taxpayer have undertaken the obligation. Being human, the employers very naturally fall in with this development of public policy, and shape their own action accordingly. In other words, what is happening in regard to the unemployed is what has happened again and again in our industrial history. We think we are throwing a bone to the poor unemployed terrier, whereas the big capitalist mastiff catches and makes off with it. The same thing occurred under the old Poor Law. The fact that the parishioners could claim maintenance from the parish had the result of driving down wages, and the farmers, in spite of the enormous rates, were often found to be defenders of the system because it enabled them to get farm-hands at 45. a week. The parish paid, say, 45. to the labourer and the farmer only paid 45. No doubt in the long run the farmers suffered from the demoralisation of labour caused by State aid, just as the capitalist will in the end 9 o PROBLEMS OF SOCIALISM xvi suffer if we keep his reserves for him. The reserves will be demoralised by the State doles, whereas they would have been maintained in true vigour had the capitalist been obliged, or rather allowed, to do his own proper work at his own charges. In fact, the plan of providing for what Mr. Ramsay Macdonald calls surplus labour by means of State action carries a double curse. It curses the recipient, and in the end it will bring a curse upon the capitalist who for the moment appears to benefit by it. The reason is plain. The power to do good work depends in the last resort upon character and rests on a moral basis, and that moral basis is destroyed when we accept what Bastiat called the great fallacy that the State is an institution upon which everybody can live at the expense of everybody else. Yours very sincerely, J. ST. L. S. XVII THE UNEMPLOYED DEAR MR. - , You are, I know, concerned, as must indeed be every thinking man in the kingdom, with the problem of the unemployed. I do not want to trouble you with the obvious arguments against encouraging unemployment by lavish relief of various kinds, but I should like to draw your attention to some of the evidence in the Poor Law Report of 1834, which is very signifi- cant, and also very appropriate to the present time. Many people are saying to-day : " It was no doubt a great mistake to start Special Committees and provide special treatment for the unemployed. It is, however, too late now to go back. We cannot cut off" the supplies from the unemployed at the very moment when trade is beginning to be slack, and when men are being thrown out of work. We must go on with the policy of giving help over and above that provided by the Poor Law." My contention is that this view is not necessary, and that we can, and ought to, reverse 9 1 92 PROBLEMS AND PERILS xvn our policy in regard to the unemployed. I hold that the proper answer to the question, " What are we to do with the unemployed ? " is " Stop manu- facturing them," that is, " Stop paying them." The same situation arose in the " thirties," and then it was found that the only effective plan was to stop putting a premium on unemployment. Read the piece of evidence given below by a witness who relates his experiences in a reformed Vestry. Before the Poor Law was reformed as a whole, single parishes would occasionally determine to reform themselves, and to give poor relief on strict principles and only after severe tests. The greater part of England at that time was under a system which can best be described as recognising the right of all men and women to be unemployed, and when unemployed to be maintained, if they chose, by the parish. The result was that the country swarmed with unemployed, and, as the witness notes, it was very generally thought impossible to get back to healthier conditions because trade was so bad. Yet, as the witness said, as soon as a parish left off paying the unemployed, the unemployed ceased being out of work. Mr. BAKER (of Uley) : " That it is not so difficult for them [persons unemployed and supported by the parish] to find work for themselves as it is generally believed to be, is proved from the shortness of the time that, with not above two or three exceptions, any able-bodied person has remained in the house ; and by a list which has been xvn OF SOCIALISM 93 made of more than 1000 persons who were on the parish books and who now can be proved to be otherwise main- tained, chiefly by their own exertions. The list shows what they used to receive, and for whom they now work. All who received parish pay before the workhouse was open are accounted for, excepting about eight or ten. Some few have left the parish, but not many. About 500 are now on the books, and most of those on reduced pay. I did not advise the introduction of the plan till I had read much, and till I had removed many doubts by private correspondence with those who had witnessed its beneficial effects for several years. Among these doubts the most important was, * How, in the present scarcity of work, can those employ or support themselves who are now receiving parish pay ? ' The answer was : c Tou will be surprised to find how soon the impossibility will dwindle down to an improbability ', the improbability to a distant hope, and that again to complete success? I was also told that industry and frugality would increase, and that crime would become less ; but I never was told, nor had I the most distant hope, that the success would have been so complete. When it began the poor were idle, insolent, and in a state bordering upon riot : they openly acknowledged that they would rather live on the parish pay in idleness than work for full labourer's wages, and when hired their behaviour was such that they could not be continued in work. Now all are glad to get work. I employed many of them in the winter of 1830, and in the spring I let them go ; but I promised them work again in the next winter, for which they expressed more gratitude than I expected : but when the winter came very few claimed my promise. They were in work which they had found for themselves, and in this winter, up to this time [December 5, 1832], only one person has asked me for work. There is one man at Uley whose character is, and ever has been, exceedingly bad, and, his feet being inverted, he is lame. He was allowed parish pay till very lately ; he applied for. an increase of it ; he 94 PROBLEMS AND PERILS xvn asserted no one would employ him, and I believed him. At a Vestry meeting, however, his pay was entirely taken off ; he instantly found work for himself, and has lived by his labour ever since." Another witness, Mr. Russell (of Swallowfield), made the following statement : " The sum of this is that the labourers generally have the means of independent support within their reach, but that, except in a few instances of rare sobriety and providence, they will not of their own accord make the efforts necessary to command them. Of most of the men here described, I have said that they are good and diligent workmen. A want of ability and willingness to work, when work is given to them, is not among the faults of English labourers ; and it cannot be expected that they will be at the trouble of finding work, if they can find support without it. They will not go in search of the meat of industry, if they can sit down and eat the bread of idleness. If you maintain them in doing nothing, and put the key of the beer-house into their hand, what right have you to complain that they are idle and dissolute ? " Mrs. Park (wife of Mungo Park, the African explorer) gave this striking testimony : " About two years ago the state of our workhouse [Gravesend] attracted my attention, from the condition in which I learned that it was during my inquiries respecting Mr. Park's patients, he being then the surgeon of the parish. There were then fifty females in the workhouse. Of these, twenty-seven were young, stout, active women, who were never employed in doing anything whatever. There were five of these young and able women who were accustomed to go to bed in the forenoon, solely to pass off the time." Accordingly a committee of ladies was formed, xvn OF SOCIALISM 95 who set about reforming the female side of the workhouse. " We wished to have the whole clothed in one way with gowns of blue linsey-woolsey, check aprons, dark handkerchiefs, and close white caps. After violent opposition from the mistress of the house and the females themselves, this was acceded to. Hitherto they had purchased the most gaudy prints for the females, and ready-made slop-shirts for the men in the house, whilst the young women were lying in bed idle. One of the paupers, a girl of eighteen years of age, who refused to work, was dressed in a dashing print dress of red and green, with gigot sleeves, a silk band, a large golden or gilt buckle, long gilt earrings, and a lace cap, turned up in front with bright ribbons, in the fashion of the day, and a high comb under the cap, and abundance of curls. A general order was given that the hair of the females should be braided and put under their caps, and no curls or curl- papers seen. . . . One effect of this partial discipline in the house was that in almost two months about one-half of the workers left. Some of them called themselves widows ; others said they did not come in to work ; they merely came in until they could accommodate themselves, until they could get themselves another situation ; but they would not remain to work, indeed^ that they would not ; they would take a room and keep themselves when they were out of place, sooner than put on a dress, and be made to work ! One refractory person said : * The poor were not going to be oppressed by work.' ' Comment on such evidence is needless. I desire, however, to note one point of special im- portance. Socialists will tell you that the reform of the Poor Law only succeeded because it co- incided with the building of -the railways, and 96 PROBLEMS OF SOCIALISM xvn therefore with a sudden and immense demand for unskilled labour. It was possible then, they argue, though it would not be now, to disband the legions of the unemployed because of the demand for navvies. But note that the examples I have cited deal with the period before the epoch of widespread railway construction. That did not set in till at least six years later. Before I leave the Report I will quote the following testimony as to the effect of lavish relief: " Do you find any effect produced by men obtaining parochial relief readily when they are out of work, or have anything the matter with them ? " " I have always seen that men who have had parish relief have been very careless of work and of their money ever afterwards. It has also acted very mischievously on the benefit societies, as these men would never contribute to them." Yours very sincerely, J. ST. L. S. XVIII WHAT WILL IT COST? WHERE IS THE MONEY TO COME FROM? DEAR MR. , A wise Imperial administrator onc^said to me that he was always having admir- able schemes for reform, and for the development and improvement of the country over whose des- tinies he presided, brought before him schemes which were often not only excellent on paper, but would no doubt have been very beneficial in practice. He made it a rule, however, before he began to consider them seriously and in detail, to ask : " What will it cost ? " and to have a proper financial estimate made as a preliminary to any discussion of the merits. The next step was to ask : " Where is the money to come from ? " By the time these two questions had been asked and answered, prudence and common-sense showed in the majority of cases that it would be inexpedient to proceed with the schemes. This no doubt was a depressing process, not only for the excellent people who advocated the particular project of 97 D 98 PROBLEMS AND PERILS xvm amelioration, but also for the administrator anxious to do his best in his trust. But the facts were inexorable, and it was useless to quarrel with them. After all, the process is one very well known to every private individual. Who is there who does not know of a dozen plans for effecting an enormous improvement in his method of life ? Unfortu- nately, we are almost always brought up short by the two questions : " What will it cost ? " and " Where is the money to come from ? " In spite, however, of such private experiences, a vast number of people refuse to apply these two questions to public affairs, but act as if " What will it cost ? " were a very small matter, and " Where is the money to come from ? " no matter at all. The assumption is, of course, that the State possesses somewhere or other an inexhaustible fund out of which money can always be produced if only it is asked for with sufficient vehemence. This belief in the Fortunatus' purse of the State is indeed the greatest of all the illusions which perplex adminis- tration. Not only is it difficult to get the man in the street to see the error. It is often quite as difficult to bring it home to the statesman. The administrator of whom I have just spoken, who is by nature far more of an optimist than a cynic, went on to say that though it was often very disappointing to have to give up fascinating schemes of improvement and reform on the grounds I have stated, he found his consolation in the thought that xvin OF SOCIALISM 99 after all there was no better way of helping the mass of the people than by refusing to add to their financial burdens. To tax people as little as possible that is, to allow them to spend their own money in their own way is to endow them with no inconsiderable benefit. He who prevents a rise in taxation, and still more he who lowers taxation, is always and necessarily a public benefactor. But though all this sounds so obvious, it is by no means the fashion at the present time. Men of the old school were wont to regard taxation as essentially an evil, though no doubt a necessary evil. The modern plan is to regard it as a positive benefit, and as a veritable source of national pros- perity. The great goddess of taxation is invoked by both parties in the State by the extreme Radicals and Socialists and by their opponents as an all-powerful deity who, if only worshipped in the proper spirit and with appropriate rites, will prove the strongest and most helpful of political patrons. Again, in old days men found certain important objects for expenditure, and in view of the imperative character of those objects excused the grim necessity of laying fresh burdens upon the taxpayer. Now we begin at the other end. We suggest schemes of taxation in vacuo^ and quite apart from the objects upon which the money when raised is to be spent. Indeed, we may now witness the amazing spectacle of politicians look- ing round for objects on which to spend taxes, ioo PROBLEMS AND PERILS xvm which are to be raised in any case, and on their own merits. The enthusiasm of the votaries of taxation inclines one, indeed, to recommend to their attention Henry Kirke White's " Ode to Disappointment." With the alteration of a word or two, the opening passage might be used as an invocation to their deity : Come, sweet Taxation, come ! Not in thy terrors clad ; Thy chastening rod but terrifies The wanton and the bad. But we recline beneath thy shrine, etc. etc. Though I fear I shall lay myself open to the taunt of being not only hopelessly behind the times, but poor-spirited, and also thoroughly un- scientific, truth obliges me to confess that I take no pleasure in the new worship. I am old- fashioned enough to regard taxation per se with aversion. Save for the needs of law, order, and public justice, of national defence, of national health, and other essential public needs, I greatly prefer to let money fructify in the pockets of the individual rather than be sterilised in the Ex- chequer. Taxation there must be in a modern State, and heavy taxation ; but let it be restricted as much as possible, and let us never forget that it is an evil, even when a necessary evil. In a word, I believe that what a statesman of a former generation called " the ignorant impatience of xvm OF SOCIALISM 101 taxation " is in itself a very sound and healthy sign. I will go farther, and say that there is no way in which a statesman can do more for the people of the country which he is called upon to govern than by reducing taxation, provided that such reduction does not sacrifice the true interests of the country by starving some essential public service, by underpaying the men who are called upon to serve the State, by imperilling the national existence, or by neglecting Imperial responsi- bilities. I claim that those who desire to reduce rather than increase taxation, and who withstand proposals for placing vast new burdens on the tax- payer in the name of social reform, are often far truer friends of the people than those who imagine that you cannot spend too much and tax too much, provided only you have got a philanthropic object and a beneficent intention. By raising unnecessarily large sums by taxation the State tends not to develop but to prevent the natural processes under which money distributes itself more equally. By high taxes on such com- modities of universal use as sugar, tea, coffee, cocoa, and tobacco, we raise the prices of those commodi- ties. But to raise the prices of commodities which all poor men use is in effect to reduce wages. Under a system of high taxes wages go less far than they would otherwise go. Sovereigns and shillings are, after all, only tickets for tea, tobacco, sugar, and so forth, 'and therefore to raise prices by io2 PROBLEMS AND PERILS xvm taxation is to dock those tickets of a part of their value i.e. of a part of their purchasing power. A similar effect is produced by undue direct taxa- tion. It is all very well to talk about taxing the millionaire and the rich man, and of so graduating your direct taxation that it shall fall only on the well-to-do. In truth, when you are apparently only hitting the well-to-do hard, you are really hitting the poor man still harder. The greater part of the money which you take from the rich man in Income-tax would, did you not take it, be spent in the employment of labour or in the accumulation of capital which would also go in the employment of labour. The capitalist em- ployers whose incomes are reduced by high taxation are by so much the less able to compete against each other for the hiring of labour. Therefore in the most practical way high direct taxation of the rich tends to injure the poor. No doubt all taxation, high and low, is open to these objections ; but that is not a reason for ignoring the fact, but for using taxation as sparingly as possible. Money raised on commodities, as I have said, reduces the purchasing power of wages, and thereby reduces wages, while high direct taxation limits that competition of the wage-payers which is the wage-earners' opportunity. All taxation hits the poor in the end. No doubt I shall be told that there is a fallacy in my argument, and that money raised for social reform, if taken from the rich in xvin OF SOCIALISM 103 direct taxation, or from the poor in the taxation of commodities, is returned to them by feeding their children, by giving them old-age pensions, or by such social reform schemes as the endowment of motherhood and the giving of a living wage to all unemployed persons. To that I reply that, even granted this return, there is an enormous amount of pure waste i.e. unproductive labour involved in the process, and also that the return is constantly made to the wrong people. In other words, there is a very large class who are not in the possession of so-called superfluous wealth, and yet to whom no return is made. Under a system of high State expenditure and huge taxation the very poor and the very rich may for a time, and till the sources of wealth are finally dried up, manage to do well enough one through their doles, the other through cheap labour and the lowering of wages which is always the result of such systems. But upon the intermediate class, including, of course, all the skilled artisans, an intolerable burden is laid. For them there is no give, but only plenty of take, until the burden of taxation has driven them into the ranks of the unemployed. If working men w,ould keep the two questions which form the title of this Letter in their minds they would find them extremely useful as tests by which to try proposals supposed to be made in their interests. They would very often find that the io 4 PROBLEMS OF SOCIALISM xvm answer to the first question, " What will it cost ? " if honestly made, would show that the expense was out of all proportion to the benefits supposed to be conferred. The answer to the second question, " Where is the money to come from ? " would, on the other hand, if pressed home, generally end in the answer, " Out of the working man's own pocket." Finally, I would ask the working men to remember that taxation is an evil, though a neces- sary evil no doubt. But though we cannot un- fortunately do without necessary evils altogether, the sensible thing is to have as little of them as possible and not as much. Yours sincerely, J. ST. L. S. XIX THRIFT DEAR MR. , The spectacle of the well-to- do in this country preaching thrift to the working man is often rather a ridiculous one, for unfortu- nately the well-to-do classes in England are by no means inclined to practise in the concrete what they admire in the abstract. Taken as a whole, I am afraid the well-to-do are, considering their opportunities, quite as great sinners in the matter of saving as those with lesser incomes. At the same time, it is undoubtedly a fact that nothing is of greater advantage to the working man than the practice of thrift. Thrift will give him a strength, an independence, and a power of better- ing his condition which nothing else will. If, then, I advocate thrift for the working man, it is not because I want him to ally himself with Capital, or, as it were, to give hostages to the present economic system, but because I am con- vinced that through thrift and the possession of some measure of private property he will find one IO5 D2 io6 PROBLEMS AND PERILS xix of the surest ways of bettering his condition. It is good to provide against sickness and old age by belonging to a benefit society, and I should be the last to deprecate this sort of thrift. It is, however, also an immense benefit to a man to have 20 or 30, or even >Tio, saved and in hand. I do not hesitate to say that no man is really a free man in the fullest sense unless he has a sum of money put by upon which he could live for a short time if things temporarily went wrong with him in his employment. If a man has no money saved, but only has that which he makes from week to week, he is bound to be to a great extent at the mercy of those who employ him. Under such conditions he may be obliged to take whatever wages are offered to him. If, however, he has enough put by to keep him at a pinch, say, for six months, he can pick and choose and can sell his labour to very much better advantage. If the employer knows that the man he employs has got enough to keep him from want for many months, the knowledge is certain, sooner or later, to affect the bargain. I am no enemy of Trade- Unions, but, instead, believe that they have done an immense deal of good to the working-man, and if properly and justly worked are of great benefit to the State. But I feel sure that the possession of private savings by the individual members of a Trade- Union gives a double strength to the workman's position. xix OF SOCIALISM 107 I shall be told, no doubt, that it is impossible for working men to save, and that in suggesting more thrift I am simply indulging in one of the delusions of the well-to-do as to the working classes. My answer is that I shall continue in my belief as long as so many millions a year are spent by working men in the consumption of beer and spirits, and still more in betting and other " un- necessary " amusements. I say this, not because I take the total abstainer's point of view, for I do not, nor because I think the working man should be without his pleasures and amusements. I believe that thrift is to a great extent a matter of habit and of the successful organisation of life, and that the ordinary working man might indulge reasonably in tobacco and beer, and at the same time put by a little each year. As a proof of my assertion that a man may acquire the thrift habit without an abstinence from the pleasures of life, which clearly it would be unfair to expect from him, I would point to the fact that those working- class families in which saving is the rule do not have such a very different standard of life and enjoyment from those in which no saving takes place. It is, as I have said, a matter of habit and method rather than any violent cutting off of all the amusements of life or the adoption of a cowardly niggardliness. Again, it is the experi- ence of all those who know the working classes that families where thrift is practised are very io8 PROBLEMS AND PERILS xix often not the families into which large sums find their way in weekly wages. Strange as it may seem, the man with the thrift habit and 255. a week will often be in a much better position as regards savings than the man without the thrift habit whose wages are 3 or 4 a week. There is a story of a workman saying to his employer : " I am a braver man than you. I dare spend my last shilling and you daren't." The story is picturesque, but I cannot help feeling that if the British working man had a little less courage in this respect it would be infinitely better for himself and for the country. Such courage may suit the worst kind of capitalist, because it puts the working man very much at his mercy. It is by no means to be commended by those who desire the real welfare of the workers. I know well that you will agree with me in all this ; but you may perhaps be surprised that I have thought it necessary to bring in the question of thrift in dealing with the problem's and perils of Socialism. I think, however, I can show you that I am not writing away from my subject. Some Socialists declare that thrift and saving on the part of the working man not only do no good, but are positive evils. For example, Mr. Quelch in his widely circulated lecture, " The Economics of Labour," takes up this position very strongly. " Labour," he declares, " becomes poorer the more it abstains and the more it saves. Temperance, xix OF SOCIALISM 109 thrift, and industry only serve to make labour an easier or more valuable prey to capital." Yet the man who writes this mischievous nonsense also declares that " the poverty of the workers is essential to Capitalism." Here, indeed, is an example of the perils of Socialism. I will never admit that the relations between Capital and Labour are those of war. Instead, they are those of co-operation and partnership. Unquestionably the absence of thrift that is, the absence of property in the worker does put him at a dis- advantage when Capital and Labour are bargain- ing as to the distribution of profits. Capital and Labour are partners, and have to settle between them how the joint profits of industry shall be dis- tributed. Neither can get on without the other. But if one of them knows that the other dare not stand idle for more than a week at a time, the position of that other is very greatly weakened. That is why I want to see the worker possessed of a nest-egg. Yours very sincerely, J. ST. L. S. XX NATIONAL AND MUNICIPAL TRADING DEAR MR. , --Those who, though not Socialists, have Socialistic leanings often ask me whether I object to all national and municipal trading ; whether, for instance, I hold that munici- palities should not own their own tramways and gasworks, and whether, again, I consider that the State ought in no circumstances to own and run the railways, as is done in Prussia. Those who ask this question are, of course, using the device of the dilemma. If I say : " No, I do not think all municipal and national trading is to be con- demned," then I am asked where I mean to draw the line. If the State can with advantage to the country run the Post Office and the railways, and the municipalities the tramways and the gasworks, and so forth, why should not the national and local Governments between them become the universal employers ? In fact, it is sought to place one in the difficulty of either accepting Socialism whole- sale or else of rejecting all State action. Let me say at once that I have no intention of allowing myself to be impaled upon the horns of I 10 xx PROBLEMS OF SOCIALISM in this very old dilemma. I am quite willing to admit that there are certain things the Post Office is, no doubt, one of them which it is convenient for the State to run. Accordingly I should never dream of supporting a campaign against all State or muni- cipal action, even though I think that such action requires to be very carefully watched. As I have said in a previous letter, I hold that each special proposal for State action or municipal action should be considered and judged on its merits. Therefore, though I have not begun every letter by stating that I do not desire to abolish the Post Office, that I do not consider that the roads ought to be a matter of private ownership, and that I do not deny the municipalities the right of acquiring open spaces or providing gas, you will, I know, understand that I am no pedant in this matter. The ideal modern State, though its basis must be individualistic, may very properly engraft upon that basis a certain amount of State action. As long as the basis is truly and honestly individualistic, the slight admixture of Socialism involved in reasonable State action will do no harm. But though I have no hidebound theoretic objection to State action in every case, I am bound to say that I do not think people at all realise how much waste is involved in State and municipal trading, and therefore how injurious such action may often prove to the working man. We must never forget that waste decreases production, and that if the product of the things ii2 PROBLEMS AND PERILS xx desired by man is lessened, there must of necessity be less material comfort and enjoyment in the world. Scarcity and poverty always go together. I believe that if the facts are honestly examined, it will be found that it is almost impossible to dis- cover any case in which the State or the municipality trades as economically and as efficiently as does the private individual. We are apt to boast about the Post Office, and no doubt it would be impossible to take away the monopoly of letter-carrying from the State and go back to private enterprise. Yet the State has not proved in any sense an ideal manager of the business of letter-carrying, and as regards both the telegraphs and the telephones a very strong case can be made out against State ownership. Again, public management of railways and tramways has by no means invariably proved an economic success. No doubt the example of the Prussian railways is often cited to show that a Government can beat private enterprise in this respect. I believe, however, that a great many traders and users of the railways in Prussia are anything but enamoured of public control, which is hard and unyielding to a degree which^ould be bitterly opposed and resented in this country. In considering such questions as municipal trading and the nationalisation of railways we must not ignore the very great evils connected with direct employment by the State. You cannot without injustice disfranchise those who serve the xx OF SOCIALISM 113 State or the municipality, and yet if you do not you place a very large number of men in the paradoxical position of being both master and servant, employer and employed. If the propor- tion of persons in Government employment is not very large, these evils may be ignored. If, how- ever, the proportion is large, or if, for example, as might easily happen with greatly enlarged State action, half, or more than half, the voters were in Government employment, this evil of the double relation of employer and employed would become most serious. Suppose the British Government were to nationalise the railways and one or two other large industries, say those of mining and shipping. In that case it might be quite possible that the employees in the Post Office, the railways, the mines, the shipping industry, and the Civil Service might be half, or a little more than half, the whole working population. That being the case, what would prevent the employees of the Govern- ment using their votes to increase their own salaries all round ? But to do this would not only be an enormous injustice to the persons still in private employment, who would pay the increased taxes and yet get no benefit themselves. It might also lead to the bankruptcy of the nation. Burke says somewhere that what frightened him was being a judge in his own cause. If those in the service of the State were actually to outnumber those in private employment, it might well be that the 1 1 4 PROBLEMS AND PERILS xx majority of the population would in fact become judges in their own cause. The difficulty I have just set forth has not as yet come within the region of practical politics, though I believe that at one time in Australia the workers on the Government railways were not allowed to vote in ordinary elections, but were given a certain number of representatives of their own. But though the danger has not yet assumed great proportions, there are indications, both in the municipalities and in the nation at large, that we are beginning to feel the pressure of the Govern- ment employees. It seems, for example, very doubtful whether the addition of over half a million to the wages of the Post Office employees made this year l was really required or was due to the working of economic laws, but was not, instead, the result of political pressure exerted by the men. I am inclined to think that this must have been so, and that the rise was not economically justified by the fact that under the old rate of wages there was no sign whatever that employment in the Post Office was unpopular. If the Government had really been paying wages below market price, the first indication of the fact would have been a difficulty on the part of the Government to secure the labour required by them. Yet all the time the number of men and women applying for work in the Post Office was greatly in excess of the number of positions vacant. 1 The increase will in the course of a year or two reach a million. xx Of SOCIALISM 115 There is yet another objection to State and municipal trading which I, at any rate, am old- fashioned enough to think very important. It seems to me extremely unjust that the State or the municipality, who are able to rely upon the well- nigh inexhaustible resources of taxation, should compete with private individuals. Yet this is what is bound to happen when public authorities take to trading. The last objection which I desire to put may seem a sentimental one, but I believe it to be very real. If the State absorbs an enor- mous amount of the wealth of the community, then the individuals who compose the community will have less of it for themselves. To my mind, " the enjoyment of property " is a phrase which represents a positive truth. But there is no enjoy- ment of property when it is lodged in the " dead hand " of the State. Property to be really enjoyed must belong to an individual. Therefore I say, let us keep as much property as we can out of the " dead hand," and let as much as possible remain to be enjoyed by the individual. Let the State defend us from foreign enemies, and maintain law and order, and do, indeed, for us whatever it can be proved cannot be done as well or better by private enter- prise. When, however, no such case can be made out for State interference, let us say to the State : " Hands off." We want to be, not as much, but as little, under Government as we can. At any rate, that is my view of .the matter. Yours very sincerely, J. ST. L. S. XXI THE LESSON OF THE ROMAN EMPIRE DEAR MR. , --In my opinion, the great danger before us is the destruction of the spirit of the people. The risk we are running is that our nation may fall through the weakening of the national fibre owing to the well-meant but ill- planned schemes of the Socialists. Let no one suppose that this is all matter of theory, and that there is no possibility of proof. Here, if any- where, history can help us. We know from history that what has tamed great nations in the past has often been the enervating State action which it is the aim and object of the Socialist Party to impose on this country. I can give on the present occasion only one instance ; but it is enough. The more the history of the decline and fall of the Roman Empire is studied, the more clear does it become that it was not the armies of the barbarians which destroyed that Empire. Rome fell because "her heart was stone," and her heart had become petrified because her people had been ruined and pauperised by the insidious action 116 xxi PROBLEMS OF SOCIALISM 117 of State Socialism. You will find the story of how State Socialism ate out the vitals of the Roman Empire told with extraordinary charm and interest by Dr. Hodgkin in his Italy and her Invaders. The pauperising legislation of Rome first wore the insidious form of a gentle inter- vention to lower the price of corn : When Spain, Sicily, and Africa were pouring in their tributes of corn or money to the exchequer of the Republic, it was not an unnatural suggestion that the wealth thus acquired might fairly be expended in easing the material condition of the Roman citizens, of the men on whom had fallen the heaviest weight of all the blows, from Regillus to Cannae, by which the Roman State had been fashioned into greatness. Not an unnatural thought ; and yet if the remembrance of the scourged veteran in the Forum, and of the cruel wrongs of the early plebeians, had any- thing to do with ripening it into action, we have here an instance of that strange Nemesis of unrighteousness which sometimes leads statesmen in the very excess of their penitence for an injustice in the past to prepare a new and greater injustice for the future. Dr. Hodgkin goes on to refer to the legislation under which the Romans became in Rome a pauper people. He tells us of the enormous doles of corn and other means of subsistence that were given to the poorer Romans, until at last they became the pensioners of the State. While that disease was eating into the vitals of the humbler classes, another was attacking the middle class. Dr. Hodgkin points out that although Aurelian's bounties and rations might have made n8 PROBLEMS AND PERILS xxi him a popular Emperor, yet Communism thus robed in the purple was becoming the destroyer of the commonwealth ; and he adds that the middle class were being oppressed beyond endur- ance. A system of rates and levies so burdensome was imposed by the State that they found it impossible to exist. There was a huge Land-tax, and cities staggered under a mountainous burden of rates. Finally, there came what under such conditions was inevitable depopulation. One of the things that helped most to ruin Rome was the failure of the human harvest. Conditions arose under which the race was pressed so hard on the one side, and was so demoralised on the other, that the true Roman, the old Roman stock, actually died out. Dr. Hodgkin ends with a passage of lofty eloquence coupled with a rare political insight : Of all the forces which were at work for the destruc- tion of the Roman world none is more deserving of the careful study of an English statesman than the grain largesses to the populace of Rome. Whatever occasional ebbings there may be in the current, there can be little doubt that the tide of affairs in England and in all the countries of Western Europe, as well as in the United States of America, sets permanently towards democracy. Will the great democracies of the twentieth century resist the temptation to use political power as a means of material self-enrichment ? With a higher ideal of public duty than has been shown by some of the governing classes which preceded them, will they refrain from jobbing the commonwealth ? Warned by the experience of Rome, will they shrink from reproducing, directly or indirectly, xxi OF SOCIALISM 119 the political heresy of Caius Gracchus, that he who votes in the Forum must be fed by the State? If they do, perhaps the world may see democracies as long-lived as the dynasties of Egypt or of China. If they do not, assuredly now as in the days of our Saxon forefathers it will be found that he who is a giver of bread is also lord. [Dr. Hodgkin might have added, " and he that receiveth the bread is a loafer."] The old weary round will recommence, democracy leading to anarchy, and anarchy to despotism, and the national workshops of some future Gracchus will build the palaces in which British or American despots, as incapable of rule as Arcadius or Honorius, will guide mighty empires to ruin amidst the acclamations of flatterers as eloquent and as hollow as the courtly Claudian. I cannot find a better end for these letters^lhan those moving words. But, believe me, I quote them here, not for their historic learning nor for their literary excellence, but because they have a message for each one of us. If we are to avoid the fate that overtook Imperial Rome, we must avoid not merely the crimes, but the well-meaning blunders in philanthropy that sealed her fate. We must not destroy but build up the strength of the nation ; and the strength of the nation is the strength of the spirit of the individuals who com- pose it. But the pauper, the pensioner, the serf of the State, no matter under what pleasant aliases you gild their position, are never strong in spirit. That is a gift which belongs alone to those who possess the priceless treasure of independence, who know how to make their own living, and who, 120 PROBLEMS OF SOCIALISM xxi free alike from a personal and a corporate lord, are the captains of their own souls and of their own bodies. Let us never forget that freedom is worth every other possession of mankind, and that under a Socialistic system freedom cannot exist. The air of Socialism is too close and heavy for a free man to breathe. Yours very sincerely, J. ST. L. S. APPENDIX A TO A SOCIALIST FRIEND BECAUSE I cannot share your creed You doubt my heart, insult my reason ; With "blindness," "levity," and "greed" In turn your eloquence you season. The maxims of your fervid school Don't err from over-toleration ; He must be either knave or fool Who will not let you save the nation. You tell us how the poor are ground In factories and dens of sweaters ; How we and they alike are bound In iron or in golden fetters. You marvel that we hug our chains ; You taunt us with our meek enduring Of evils that your wiser brains Alone possess the art of curing. You think, forsooth, we have not felt That cloud of human care and sorrow, Because we fear it will not melt Before your magic wand to-morrow. Your passionate exordium spare, And spare us, too, your peroration ; The argument is rather bare When only rich in declamation. 121 122 PROBLEMS AND PERILS APP. Have you discovered, you alone ! The squalid village, sordid city ? We too our hearts are not of stone Possess some rudiments of pity. 'Tis just because we so deplore The ills of poverty and famine, That, lest you aggravate them more, Your panacea we cross-examine. My doctor, say, for my disease Prescribes but exercise and tonic. You scoff at remedies like these : u Mere palliatives to make it chronic ! " No ! I must stand upon my head To keep the gout from upwards rising, And swallow the East-wind for bread It's lighter and more appetising. I hint that what you recommend May be too thin for my digestion ; The one reply you condescend : <{ What folly thus to beg the question ! " But when I learn that first on me You try this regimen and diet, .>(]. net CO., LONDON. THIS BOOK IS DUE ON THE LAST DATE STAMPED BELOW AN INITIAL FINE OF 25 CENTS WILL BE ASSESSED FOR FAILURE TO RETURN DAY AND TO $1.OO ON THE OVERDUE. ion in or soci..i.j.-> ; Brits.: 24,' 14193 182784 '30