.11'.-:'!
 
 THE LIBRARY 
 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 LOS ANGELES
 
 THE PRICE 
 
 OF 
 
 INEFFICIENCY 
 
 BY 
 
 FRANK KOESTER 
 
 Associate Member American Institute of Electrical Engineers 
 
 Member Society for Promotion of Engineering Education 
 
 Member Society German Engineers (Berlin) 
 
 Author of "Hydroelectric Developments and Engineering," "Steam 
 
 Electric Power Plants," "Elecricity for the Farm and 
 
 Home," "American City Planning," etc. 
 
 mew ISocft 
 
 STURGIS & WALTON 
 
 COMPANY 
 
 1913 
 
 All Rights Res$rv«d
 
 Copyright, 191S 
 By STURGIS & WALTON COMPANY 
 
 Set up and electrotyped. Published, March, 191S
 
 HC 
 
 IOC 
 
 * ' The true measure of a man 's success is the 
 service which he renders, not the pay he ex- 
 acts for it. The true measure of a man's 
 ability is the power to help others and to con- 
 tribute to their advancement. The effort to 
 make money is an important incentive to so- 
 cial service and industrial progress; but the 
 amount of wealth each man acquires is no ac- 
 curate indication of the service he has rend- 
 ered or the progress he has made possible. ' ' 
 
 President ILvdley of Yale. 
 
 14S10G1
 
 PREFACE 
 
 The great burden of inefficiency, with its terrible cost, is a bur- 
 den that is carried on the shoulders of each and every one of us. 
 "Whatever your income may be, much or little, increasing or de- 
 creasing, you are paying your full share in one form or another 
 of the waste, which amounts to over ten billions of dollars an- 
 nually; a waste that means that forty cents of every dollar you 
 earn goes for nothing. 
 
 You are paying this, the price of inefficiency, in a thousand 
 different ways for your personal negligence in not taking the 
 interest that you should in the business and governmental affairs 
 of the countrA'^ and in your own private concerns. 
 
 What it is possible for you to do to reduce the frightful costs 
 of inefficiency, what you should do and what you must do, is a 
 question the responsibility for which you cannot escape. If you 
 remain merely neutral, you bear the loss just as surely, since the 
 government, city, state and national, your employer, your em- 
 ployees, and your friends will be all the more active in their 
 work of reducing your resources, cheating or robbing you, both 
 directly and indirectly, and adding to the costs due to your in- 
 efficiency as a recreant member of a government, the individuals 
 of which must rule themselves as a body, if they are not to be 
 ruled by bosses, minorities and combinations. 
 
 A little well directed individual effort, which will become a 
 matter of habit, will suffice to effect vast reductions in the price 
 of inefficiency. Even the knowledge of where the waste is, will 
 in many cases call forth the remedy, though in other cases 
 entirely new principles must be called into action. 
 
 It is the purpose of this book to show where the frightful 
 wastes are being incurred, in governmental, and industrial, 
 social and educational affairs, to point out remedies for reducing 
 them to a minimum or eliminating them entirely, and to indicate 
 new principles which may often operate not only to reduce and 
 eliminate inefficient methods, but to leave the field clear for 
 efficiency. 
 
 It is of tremendous importance to the nation to take a stand
 
 vi PREFACE 
 
 for betterment. Conditions will grow worse unless they are 
 made to grow better, and the problems which are so acute and 
 pressing cannot be solved by parties or by statesmen, by legis- 
 lators or committees, but must be solved by the spontaneous and 
 irresistible effect of public sentiment and individual action. 
 There is something for everyone to do, and when the extent and 
 gravity of the situation is understood, no one will hesitate to do 
 his part. It is the duty of those who are acquainted with the 
 facts to make them more widely known, and in this respect the 
 influence of the press is of the greatest consequence, and a 
 patriotic and non-partisan espousal of the cause of efficiency on 
 their part and a genuine and persistent attention to the subject 
 cannot fail to be reflected in increased prosperity for all con- 
 cerned. Newspapers should devote their attention systematic- 
 ally to the matter, treating every phase of it in a constructive 
 way, pointing out how efficiency is to be obtained and how much 
 it means. 
 
 Not alone will the interests of the public be served but their 
 own as well, by increased circulation and increased advertising 
 and by the influx of new firms with new advertising. The prop- 
 aganda of efficiency will mean increased prosperity for every 
 paper and every reader, and no editor can serve his country, his 
 public and his paper better than by a thorough and persistent 
 attention to efficiency. 
 
 Efficiency is not a thing reserved for the comprehension of 
 the elect. It is not a thing to be called ''scientific management" 
 and used as a bug-a-boo ; it is, on the contrary, nothing but com- 
 mon sense applied to every day affairs, the doing of a thing in 
 a better, quicker and more economical way than at present, the 
 doing of a thing in the right way, the easy, the adept, the 
 direct and natural way, rather than in the careless, the slovenly, 
 the wrong and the round-about way. 
 
 Efficiency has a widespread application and may be practiced 
 in a widespread manner and by every one, in some form or an- 
 other. Efficiency is the duty, not only of every man to himself, 
 but of every man to his neighbor. It is a slogan that means 
 prosperity and a watchword of honest effort and well directed 
 energy. 
 
 If a hundred men have a certain work to perform, week in 
 and week out, a few of them will presently be found to execute 
 the work with greater ease and dispatch than the rest, and of 
 these few, one will be found who, with less expenditure of energy
 
 PREFACE 
 
 vu 
 
 and time than any of the others, accomplishes the work better. 
 That man is the efficient man, and he has evolved the efficient 
 raetliod. That method should be made known to all and fol- 
 lowed by all, and a high degree of efficiency will be the result 
 for all. The inferior methods of the others are costly and should 
 be discarded without delay. Those who are willing to learn will 
 progress, but those who cling to their old methods and refuse 
 to learn will fail. 
 
 This is true not only of individuals but of nations as well, 
 and it is a criminal waste of time and resources not to adopt 
 methods which have proved themselves the right ones elsewhere, 
 but instead either to stick to old methods or experiment along 
 lines which have already been gone over. 
 
 Every possible improvement should be known and considered 
 instead of being ignored until it forces its way into use. In- 
 stead of the ready excuse when a new thing comes out elsewhere, 
 that it is not applicable to our conditions, it should be made 
 applicable. INferit should be sought out wherever it may be 
 found, instead of being choked off and forced to fight its half 
 starved way to the front. 
 
 As long as a man is satisfied that he has nothing more to learn, 
 he will learn nothing more, but when he realizes that he is not 
 yet the master of the accumulated know^ledge of the world on 
 his subject, he will progress. Once in the swing and step of 
 progi-ess, he can readily keep abreast of his competitors and 
 apply to his own problems the results which have been and are 
 constantly being achieved by others. 
 
 It was, at the outset, the intention to make this volume a 
 brief exposition of certain of the more noticeable phases of in- 
 efficiency, but in compiling the data and in seeking out the 
 underlying causes for inefficiency, new and more profound 
 causes appeared. 
 
 It was as if an underground city of decay had been entered, 
 avenue after avenue of inquiry presented itself and at every 
 turn new and greater vistas of crumbling walls and tottering 
 pillars appeared. Overhead the world takes its way, with here 
 and there a sinking of the street or an upheaval of the surface. 
 Beneath, the foundations are undermined by neglect, careless- 
 ness, graft, self-satisfaction, disrespect of authority, lack of 
 discipline, faulty education, lawlessness, suspicion, waste, squan- 
 dering of resources, extravagance, crooked dealing, monopoly, 
 indolence, superficiality and politics; a stupendous labyrinth of
 
 ^" PREFACE 
 
 destructive forces, which mean national disaster if fundamental 
 and comprehensive measures for correction are not undertaken 
 at once. 
 
 As in the design and construction of a great engineering work, 
 where the whole and its various components must be suited to 
 the requirements to be met, so the governmental, social, econom- 
 ical and business organization of a country must be suited to con- 
 ditions if disaster is not to be encountered. 
 
 Like a great dam which conserves enormous resources of 
 energy in storing millions of gallons of water, so must the social 
 structure conserve the energy of humanity and utilize it for the 
 benefit of humanity. 
 
 Unless the dam be properly calculated, and of the right de- 
 sign ; constructed of the best materials and erected on a firm 
 foundation, it will soon begin to show evidence of failure ; crev- 
 ices will appear, the true alignment be lost and the relief gates 
 jammed. Although expedients be adopted, crevices patched and 
 reenforcements applied, if the weakness is in the original design 
 the time will come when nothing further will avail, when the 
 dam cannot be saved and when it is destined to carry death and 
 destruction in its final collapse. 
 
 So with the social machineiy of a country. If it be not rightly 
 constructed, if the attitude of the individuals to each other and 
 to the government, and the attitude of the government toward 
 the individual be not properly founded in mutual respect and 
 self respect, no amount of patching can save the structure. And 
 though the disaster may be far reaching, it will, as in the case 
 of the failure of the dam, at least wipe out old mistakes and 
 makeshifts, and leave the ground clear for the work of new engi- 
 neers, who, profiting from experience of the past, and with 
 sounder theory and more thorough practice, will erect a struc- 
 ture capable of withstanding the stresses to which it ■will be sub- 
 jected and capable of utilizing the accumulated forces to the 
 greatest possible advantage. 
 
 Such an improved social structure once established will, like 
 a dam using the energy of the stored water to turn a multitude 
 of gonorators, distributing onorgA' in other forms throughout the 
 surrounding country and stimulating its production similarly, 
 infuse a new stinnilus to the whole life of the nation, both in the 
 present and in the future. 
 
 The great extent and doep-rootedness of the evils of the situ- 
 ation cannot be comprehended by the individual who does not
 
 PREFACE ^ 
 
 take a broad and public-spirited view of conditions. It is in- 
 deed appalling when seen as a whole, and the lack of real patri- 
 otic interest in the country, taken by its citizens, is a reproach 
 and a menace of impending disaster. 
 
 The neglect of the individual extends not only to the nation's 
 affairs, but to his own, and it is only after a realization of how 
 general is this condition, that the individual can be expected to 
 see that only by a thorough readjustment of his own attitude 
 and affairs, can he do his part in the new scheme of things that 
 must come into existence, if we are not to descend to far more 
 serious conditions. 
 
 That a grave situation exists cannot be denied, but that con- 
 ditions may be improved is equally patent, as shown by what 
 exists abroad, where a more advanced and efficient public 
 opinion has found a means of enforcing itself. 
 
 It would be impossible for any one person to speak with au- 
 thority on subjects so complex and varied as must go to make 
 up a broad review of national conditions, but in every depart- 
 ment the situation has been analysed by experts, and wherever, 
 herein, conclusions have been advanced, they are based on ac- 
 cumulated experience and fortified by the highest authorities. 
 The reports of the federal government, census reports, state and 
 national authorities and specialists have been freely quoted, so 
 that it is believed that in every important particular, corrobora- 
 tion will be found for any statements advanced. 
 
 Although it might appear that much of the matter is of a 
 negative or critical nature, there will be found no small amount 
 of constructive criticism, that is to say suggestions for actually 
 remedying conditions. Americans are, unfortunately, not prone 
 to criticism, and are much imposed upon in consequence. Their 
 proverbial generosity and magnanimity are too much taken ad- 
 vantage of. A more critical spirit could not fail to have a 
 stimulating effect, and while many of the criticisms here made 
 might appear antagonistic if from the pen of a passing visitor, 
 yet as the author has been a resident of some ten years' standing, 
 continually active in business and professional life, and has be- 
 come a citizen and oast his fortunes here permanently, it will 
 be seen that the criticisms are as of one member of a family to 
 another, intended for the common good and for the remedying 
 of conditions from wliich we all suffer alike. 
 
 The volume is not intended, however, in any way to be a com- 
 prehensive resume of American life or institutions, and any
 
 ^ PREFACE 
 
 general conclusions should not be attempted to be drawn from 
 it, for the many admirable, not to say unparalleled, activities 
 of American life are but seldom referred to. The pui^pose of 
 this book is not to praise nor sit in judgment nor to attempt a 
 broad summary, but to point out defects and shortcomings 
 which are much more apparent to one with foreign experience 
 than to one to the manner born, defects and shortcomings which 
 perhaps on that account have gone if not unnoticed, at least un- 
 remedied. 
 
 For the quotations made throughout the book, the author begs 
 to acknowledge the courtesy extended by the several authors 
 and publishers. It is through this courtesy that the author 
 hopes to have made the book an authoritative presentation of 
 the various subjects. 
 
 It is hoped that the work will be received in the spirit in- 
 tended, that of helpful and constructive criticism, and that it 
 vnM be of assistance in promoting a better understanding of the 
 great cohesive force of social life, the fuller co-operation of indi- 
 viduals with each other and with the state, of the state with the 
 individual, and of the states of the world with each other. 
 
 F. K. 
 March, 1913, 
 New York City.
 
 CONTENTS 
 
 Pbefack ^ 
 
 Introduction ^'" 
 
 I The Situation 3 
 
 II OuB Political System ^ 
 
 III Administrative Waste 22 
 
 IV What is Conservation? 32 
 
 V Conservation of Human Life 44 
 
 VI By-Products of Inefficiency 54 
 
 VII Private Monopoly '^^ 
 
 VIII Governmental Socialism 83 
 
 IX Governmental Socialism in Germany 96 
 
 X Municipal Socialism 115 
 
 XI Commission Government 142 
 
 XII Industrial Handicaps I 160 
 
 XIII Industrial Handicaps II 182 
 
 XIV How to Supplant the Trusts 202 
 
 XV Business is Business 215 
 
 XVI Stimulating Progress 248 
 
 XVII Undeveloped Resources 257 
 
 XVIII The Problem of Immigration 283 
 
 XIX The Eight to Work 293 
 
 XX Social Insurance 314 
 
 XXI Tom, Dick and Harry 330 
 
 XXII Cutting Out the Middleman 346 
 
 XXIII Public Welfare 358 
 
 XXIV Domestic Relations 379 
 
 XXV Educational Systems 385 
 
 XXVI The Remedies 414 
 
 X 427 
 
 Index *^'
 
 INTRODUCTION 
 
 Unrest and turmoil are the order of the times, protest and 
 animosity show themselves at evei*y hand, and hatred and hope- 
 lessness, bitter distrust and denunciation govern our relations 
 as classes and as individuals. 
 
 We are facing an acute but intensely complicated crisis in the 
 existence of the nation, and the contributing causes are numer- 
 ous and grave, with remedies difficult to understand and more 
 difficult to apply. The country is like a giant, bound hand and 
 foot and tormented on every side, in an intolerable situation 
 but hopeless of any relief. 
 
 We confront conditions, not theories. Familiar with great 
 prosperity and accustomed to the swing of progress, there seemed 
 no bounds which w^e might not permit ourselves; and thus the 
 awakening is all the more abrupt and severe, and the present 
 stagnation all the more keenly felt. 
 
 A young nation A\dth vast natural resources, the fair way 
 ahead was free and clear, but suddenly we find that our re- 
 sources have been squandered and are approaching exhaustion, 
 that we have been betrayed by our financiers and politicians and 
 led into the blind alley of disaster. 
 
 Though being a self-satisfied people, we are yet unable to 
 assert ourselves at the right juncture in our own interests. We 
 cannot kick and kick vigorously enough at the right time and 
 place, and we are continually getting deeper and deeper into 
 trouble. In a national crisis of this kind, the statesmanship of 
 a country should be its guiding light, but where are our states- 
 men to be found? Where are our leaders who are not chiefly 
 concerned with their own political interests. A government 
 should be an inspiration and a guiding force, an encouragement 
 for industry and business, but instead of exhibiting such a firm 
 and fruitful policy, our administration is one of waste and gross 
 inefficiency. 
 
 With statesmanship such as America should command, the 
 dangerous shoals we are now encountering, would long ago have 
 been avoided. With patriotic and disinterested hands at the 
 helm of state, such dangers would have been clearly seen and 
 
 xiii
 
 xiv INTRODUCTION 
 
 avoided, whereas now the vessel of government is crushing first 
 against Scylla on one side and tossed by Charybdis on the other. 
 
 The government may be charged and unanswerably charged 
 with: 
 
 Ruining of prosperity for petty partisan advantage; 
 
 Creating industrial unrest and turmoil; 
 
 Destruction of confidence of the public in the state; 
 
 Unexampled waste of natural resources; 
 
 Gross administrative inefficiency and incompetency; 
 
 Restriction of industrial development; 
 
 Crippling business enterprises; 
 
 Neglect of agricultural needs and a failure to check enormous 
 waste of farm products; 
 
 Sacrifice of countless lives in unregulated industrial establish- 
 ments ; 
 
 Negligence in combatting industrial diseases; 
 
 Administrative self interest, waste and graft; 
 
 Inadequacy and insufficiency of the law; 
 
 Failure to cope with monopolies; 
 
 Failure to prevent adulteration of foods; 
 
 Continuance of a deceptive and destructive patent system; 
 
 Autocratic administration of the post office; 
 
 Continuance of shameful pension frauds; 
 
 Promoting the spirit of lawlessness and disrespect for law; 
 
 A wrongful immigration policy. 
 
 \Vhile these are among the principal items directly chargeable 
 to the government, a more considerably responsibility is charge- 
 able to its failure to take constructive action. The government 
 is negligent in that it 
 
 Fails to modernize the constitution ; 
 
 Fails to provide an adequate and i)roper educational system ; 
 
 Fails to link the educational system with practical life through 
 not compelling the learning of a means of livelihood on the part 
 of every citizen; 
 
 Denies the right to work; 
 
 Fails to protect small industries from the aggression of mo- 
 nopolies; 
 
 Neglects to provide a national testing plant for the promotion 
 of manufacture; 
 
 Fails to provide industrial insurance systems for accident, 
 sickness and old age. 
 
 Improperly develops waterways ;
 
 INTRODUCTION 
 
 XV 
 
 Does not cause the administration to command the respect of 
 the public; 
 
 Does not obviate mismanagement of railway and industrial 
 plants ; 
 
 Does not cause the servants of the public to realize that they 
 are the servants of the public ; 
 
 Fails to prevent the congestion of wealth in the hands of the 
 few; 
 
 Fails to diminish the controversy between capital and labor; 
 
 Fails to command the respect and good will of foreign com- 
 merce ; 
 
 Fails to promote our merchant marine; 
 
 Fails to adopt a constructive diplomatic policy. 
 
 The machinery of the government and the personnel which has 
 been evolved to administer its affairs is incompetent and in- 
 efficient. It is in a state of break down, is unable to cope with 
 conditions which it has created and its deplorable and destruc- 
 tive and desperate activities are like a huge machine grinding 
 itself to pieces. The situation is acute and demands the careful 
 thought and vigorous action of every citizen. 
 
 Incompetency and inefficiency are not alone confined to high 
 places; they take their noisome course through the whole body 
 of the government. 
 
 As Superintendent of Insurance, William H. Hotchkiss of 
 New York, in a recent newspaper interview said : "The times are 
 out of joint. 
 
 ' ' Never before was enlightened public service more in demand. 
 Indeed, may we not well turn aside from insurance problems 
 and for the moment glance at the problems with which all Amer- 
 icans are now concerned? Whither are we of a great republic 
 drifting? Labor glowers and threatens an industrial war. Big 
 business shakes -snth ague. Capital is dissatisfied, prosperity 
 is checked. The people call loudly for retributory law against 
 manager and magnate. Strong arm methods toward great cor- 
 porations are in full operation in nation and state. Commerci- 
 ally speaking our times are out of joint. Likewise our politics. 
 The people's legislators long since lost the people's confidence. 
 Their executives must now exceed the written law or lose in 
 power and usefulness. Their judges even are threatened with 
 recall. 
 
 "Parties once potent are going to pieces as the voters right- 
 fully gain the power to nominate their public servants. Social-
 
 xvi INTRODUCTION 
 
 ism — of the right or of the wrong sort — is winning converts 
 every day. The cloistered citizen of the kid gloved wards is be- 
 ginning to have his say, while the horse block orator is harangu- 
 ing an audience that may any moment become a mob." 
 
 The government, which includes not only the ever changing 
 federal administration, and its legislative and judicial branches, 
 and the governments of the states as well, are as open to criticism 
 as the most outrageous of the tnists. The ensemble governments 
 of the United States, in their mountebank struggle with con- 
 ditions passed some 44,000 laws in 1910. 
 
 In the words of ex-Governor Herrick of Ohio, there were: 
 
 "Laws to regulate everybody and everything except the pub- 
 lic exi)euditures of the law-makers themselves and of the various 
 departments of the government. The great majority of men 
 sitting in our legislative bodies are lawyers, whose natural ten- 
 dency is to attempt to remedy every ill by a statute. 
 
 "The oversight of business enterprises by the government has 
 plai'od on the government payrolls a vast number of officials; it 
 has necessitated the establishment of new departments, the keep- 
 ing of a mass of records and the compilation of a great quantity 
 of statistics. All this has been done with no serious attempt 
 to reform the antiquated expensive methods prevailing in all 
 departments of the government. 
 
 "The people have been so intent on placing the corporations 
 under governmental control that they have overlooked the ad- 
 ditional burden they are putting on their own shoulders by 
 placing this work in the hands of officials who, handicapped by 
 bad metluKls, are rendered powerless to do little more than swell 
 the payrolls. 
 
 "It got's without saying that predatory corporations either 
 should be brought within the law or put out of business. It is 
 doubtless true that salutary laws have been passed regulating 
 other corporations, but we should also apply ourselves, as a 
 eonditinn precedent to the government's further controlling and 
 managing these corporations, to reforming the administration 
 of the governmont. Otherwise the burdens of taxation will be- 
 come iinbearable, intolerable, and in the reaction which will 
 surely follow, much of the good of the progressive legislation of 
 reeent years will be undone." 
 
 The great majority of the 44,000 laws referred to will un- 
 doubtedly be dead letters in a short time, if they ever have any 
 efTect. As dead letters they only serve to clog the administra-
 
 INTRODUCTION xvii 
 
 tion of justice and encourage disrespect for the law. Any 
 one of them, however, may be utilized at any moment as a means 
 of creatino: confusion and for political effect, as has been the 
 case with the Sherman law. 
 
 To such conditions, to inefficiency in office, to corruption, to 
 graft, to neglect of the preservation of natural resources, to fail- 
 ure to encourage industry and agriculture, to the throttling of 
 business, to utter disregard of public welfare we have been 
 brought by our statesmen in their wisdom. 
 
 What it all means in dollars and cents alone may be computed, 
 but what it means in unrest, distress, discouragement and misery 
 is beyond any human calculation. 
 
 The principal items in the indictment of inefficiency, costs 
 which could not be charged against an efficient government, 
 quickly total an appalling figure, a figure which concerns vitally 
 not alone every citizen of the country, but the world at large, 
 for the prosperity of all civilized nations is vitally connected. 
 
 "We waste $50,000,000 and sacrifice fifty lives a year in forest 
 fires, and have been doing it for over a generation, while in some 
 years the loss amounts to $200,000,000 in money. In addition 
 the young gro\\i;h destroyed by fire is far more valuable than 
 the merchantable timber burned. 
 
 "We waste a billion cubic feet of natural gas daily, the most 
 perfect of fuels; enough to supply every city of over 100,000 
 population in the United States. 
 
 We waste $22,000,000 a year in the manufacture of coke in 
 lost gases; 540,000 tons of ammonium sulphate of similar value 
 and nearly 400,000,000 gallons of tar worth $9,000,000, a total 
 with other wasted by-products of $55,000,000. 
 
 We waste a vast sum yearly in not utilizing our deposits of 
 peat as fuel. The value of available peat beds is estimated at 
 thirty-nine thousand millions of dollars. 
 
 We waste 30,000,000 horsepower every year, by failure to 
 utilize our water power. At $20 per horse power per annnum, 
 which is below the average price, being less than one cent per 
 horse power per hour, this waste amounts to $600,000,000. This 
 is far in excess of the value of all coal used annually, and if this 
 power were utilized, coal could be conserved for future uses, for 
 heating and purposes where the power would not be serviceable. 
 
 We waste $238,000,000 in losses through floods and freshets. 
 The most of this could be prevented by proper engineering in 
 the erection of levees and dams.
 
 '^viii INTRODUCTION 
 
 We waste $500,000,000 a year in soil erosion. Through the 
 neglect of farmers to properly work their land and to prevent 
 the formation of gullies, the fertility of the soil is washed into 
 the lowlands and seas. 
 
 We waste vast land resources by failure to drain swamps and 
 overflowed areas. These lands could be reclaimed at small ex- 
 pense, increasing the value of the land three fold, and supplying 
 homes for 10.000,000 people. 
 
 We waste $659,000,000 a year through losses to growing crops, 
 fruit trees, grain in storage, etc., by noxious insects, whose multi- 
 plication is largely due to careless methods of agriculture. 
 
 We waste $267,000,000 a year through the attacks of flies, 
 ticks, and other insects on animal life. A greater loss is caused 
 by the enormous sacrifice of human life due to mosquitoes, flies, 
 fleas, and other germ carrying insects. 
 
 We waste $100,000,000 annually in losses to live stock and 
 crops by wolves, rats, mice and other depredatory mammals. 
 
 We waste $93,000,000 a year in losses of live stock due to dis- 
 ease, of which $40,000,000 is chargeable to Texas fever, while 
 tuberculosis, scabbies and cholera are next in importance, all of 
 which are largely preventable if not eradicable. 
 
 We waste $772,000,000 annually in losses of income, due to 
 industrial diseases; that is diseases which attack workers on 
 account of the nature of their employment and the unsanitary 
 conditions in which the work is carried on. 
 
 We waste $1,500,000,000 a year through loss of life and illness 
 to industrial and other workers, through preventable disease, 
 accidents and carelessness. The truth of this is corroborated by 
 the fact that the expectation of life in Germany is ten years 
 longer than in America. 
 
 We waste $2,503,900 a year, in the form of 1465 human lives, 
 (using the figure $1700 as the economic value of a human life, 
 the governmental estimate later referred to) in coal mine acci- 
 dents, which are almost wholly preventable. 
 
 We waste 10,585 lives and the cost of 169,538 injuries in rail- 
 road accidents. 
 
 We waste $300,000,000 annually in the lax administration of 
 the government itself. This is equivalent to the economic value 
 of 176,470 lives. 
 
 We waste a considerable proportion of our vast pension ex- 
 penditures of $173,000,000 due to fraudulent and undeserved 
 pensions granted. The cost of the pension armies of Germany,
 
 INTRODUCTION 
 
 XIX 
 
 France, England and Austro-IIungary is less than $100,000,000. 
 
 We waste $25,000,000 a year in handling the mails, while the 
 German government makes a net profit of $28,000,000 on a much 
 smaller gross business. 
 
 The foregoing are only a few of the principal items in the 
 price we pay for the inefficiency of our federal and state govern- 
 ments, as with proper administrative efforts, an enormous part 
 of the total would be saved. There are in addition countless 
 important items of loss, which cannot be definitely ascertained, 
 as many unknown factors enter into them, though the losses are 
 no less because of not being determinable in dollars and cents. 
 The foregoing figures are the result of careful and frequently 
 repeated estimates by conservative governmental experts, and 
 are in each case in accord with the observations of intelligent 
 farmers and other interested persons acquainted with conditions. 
 
 Nor do these items aggregate the principal part of the losses 
 of inefficiency. In other branches of activity over which the 
 federal and state governments have no control, the losses are 
 even greater. 
 
 We waste $250,000,000 annually in fire losses to buildings and 
 
 other structures. 
 
 We waste $400,000,000 a year in the expense of the portion of 
 city water supply used for fire fighting, in fire department 
 charges and in distribution charges, all of which makes the loss 
 per capita in this country ten times that of European countries, 
 showing the grossest waste and inefficiency. 
 
 We waste $650,000,000 annually in mismanagement of rail- 
 roads, of which $300,000,000 is due to personal services, $300,- 
 000,000 in fixed charges and $150,000,000 in supplies. 
 
 We waste perhaps a greater sum in private manufacturing 
 establishments. AVhile this has not been estimated by experts, 
 yet since the railroads of the country are valued at eleven thou- 
 sand million of dollars, while the value of manufactured prod- 
 ucts exceeds seven thousand millions, and since railroad effici- 
 ency is 10% while manufacturing efficiency is but 60%, the loss 
 in manufacturing is probably greater than in railroad ineffi- 
 ciency. 
 
 We waste in the careless handling of eggs, $40,000,000 a year, 
 largely due to breakage in transportation. Wliat the vast waste 
 of careless freight, express and baggage handling amounts to in 
 actual damage, besides the increased cost of packing to guard 
 against it, it is impossible to estimate.
 
 XX INTRODUCTION 
 
 We waste an enormous amount, which has not yet been made 
 the basis of a comprehensive examination, in losses due to im- 
 proper and antiquated methods of mining; in coal, copper, gold, 
 silver and other metals and in metallurgical processes of various 
 kinds. 
 
 We waste not less than one third of all the coal used for 
 power purposes and vastly a larger proportion in heating 
 through failure to adopt modern machinery and methods. 
 
 We waste $25,000,000 a year by failure to adopt the potato 
 drj'ing process used in Germany, that proportion of our potato 
 crop rotting unnecessarily. 
 
 We waste $12,000,000 in failure to utilize the leaves of potato 
 and other plants, a source of profit in Germany but a total loss 
 ^^dth us. 
 
 AVe waste sums which though immense, are not capable of be- 
 ing computed, in our slowness to adopt a great number of im- 
 provements which are available and in daily use in Europe. 
 Potato drying is only an insignificant example of this waste. 
 
 We waste $702,000,000 a year at the lowest estimate in the 
 failure of our workmen and manufacturers to adopt common 
 sense practice in daily operations, a method of working the in- 
 troduction of which is being greatly hampered by being called 
 by the high sounding name of "scientific management" or 
 ''motion study." 
 
 We waste 350 lives and the cost of 2700 accidents in trans- 
 portation in New York City alone, with a proportionate loss in 
 other cities throughout the country. These losses involve, in 
 addition, great expenditures in litigation, the total of which is 
 probably not less than $25,000,000 annually. 
 
 What we waste in losses through inefficiency of administration 
 in cities and towns, losses due to crooked and ill-considered con- 
 tracts, and the great wastes of graft of all kinds are beyond com- 
 putation. 
 
 These figures, although startling, are only a part of tlie stag- 
 gering price of inefficiency. A multiplicity of additional re- 
 searches in all industries would be necessary to ascertain the 
 entire amount of waste. 
 
 iMalcing due allowance in the items enumerated, where saving 
 could not be effected; where the waste though great may be 
 termed unavoidable ; the total remaining constitutes a frightful 
 indictment of American extravagance, waste and carelessness. 
 It amounts to more than ten thousand millions of dollars an-
 
 INTRODUCTION 
 
 XXI 
 
 nually, a per capita loss, assuming the smaller figure, with our 
 population, of not less than $100. For the 33,000,000 wage- 
 earners of the country, it amounts to not less than $300 per year 
 or a minumum of $5.75 per week, since the burden is concen- 
 trated on their shoulders. As the average wage of wage-earners 
 is under $10 a week, the crushing weight of inefficiency, of the 
 venomous graft and criminal waste which pervades our national 
 life from government to individual, is understood, and the ne- 
 cessity of prompt, thorough and vigorous efforts at remedying 
 conditions is appreciated. 
 
 Among the principal causes of these conditions is the fact that 
 everybody is looking out for himself too much and too ruth- 
 lessly; seeking with too much energy the immediate ''practical" 
 advantage, and ignoring the fact that his own welfare is indis- 
 solubly bound up with the welfare of his neighbor. A vicious 
 circle is set up in that the citizen lacks respect for the employer 
 and the government, and the government is not primarily con- 
 cerned with the welfare of the citizen. Everyone is working 
 at loggerheads and the result of this condition is seen in the 
 establishment of trusts and their consequent train of evils, 
 through the impossibility of the business man surviving in the 
 conditions of fierce competition which ordinarily prevail. Had 
 fair competition been assured by law, trusts could never have 
 overcome the independence of business men and forced them 
 into consolidations. 
 
 In seeking remedies for the conditions which have been 
 created, it is the part of wisdom to draw comparisons with other 
 countries in which similar conditions have been met. 
 
 Owing to certain advantages in inherited policy and charac- 
 teristics, as well as from natural causes, one of the countries 
 which has solved many of the problems which are obstacles to 
 general prosperity and progress in America to-day, is Germany ; 
 and in considering American conditions, many comparisons will 
 be made with German conditions, where efficiency has reached 
 the highest point of development yet achieved ; since the author, 
 being of German birth and training, is familiar with those con- 
 ditions, as well as with American conditions through citizenship 
 and an active participation in American business and engineer- 
 ing undertakings during the past ten years. 
 
 Of the great benefits that are to be derived by indi\'iduals 
 as well as countries, from the study of conditions in other coun- 
 tries, there can be no doubt.
 
 5«ii INTRODUCTION 
 
 Mr. Herman Ridder, the eminent editor, in the American 
 Travelers' Edition of "Deutsehland," an official journal for the 
 promotion of international intercourse, writes under the title 
 "The United States and Germany" as follows: 
 
 "Any move which tends to stimulate international intercourse 
 is conducive to universal welfare. For upon the shaping of the 
 relations between the civilized nations of the earth, depend its 
 future destinies, and these relations are seldom strained, but, 
 almost unexceptionally, improved by mutual acquaintance. Let 
 the people — mind you, the real people, and not the fortuitous 
 exponents of their dispositions or customs or policies — the peo- 
 ple of two nations, like the United States and Germany, once 
 grow to understand and know one another thoroughly, and they 
 will be apt to rule the w^orld. Not as allied conquerors by the 
 strength of arms, but as joint leaders in the material and in- 
 tellectual development of the human race. Then there would be 
 no need of a formal alliance secured by convention or treaty, 
 for as soon as either nation becomes convinced that there is no 
 elementary antagonism of interests, and that, on the contrary, 
 their interests are reciprocal, a co-operation along the whole line 
 of human development will be the perfectly natural result. This 
 is, in the case of Germany and the United States, no idle vision 
 of a desirable future status. For there exists between the 
 American and GeiTnan peoples a closer community of interests, 
 a truer identity of national endeavor and a nearer relationship 
 of national consciousness than may be obvious to the casual 
 observer. 
 
 "When more than fifty per cent of the population of the 
 United States have German blood in them — a fact established 
 by the Federal census returns — the German influence upon the 
 forming of the character of the American nation cannot be ig- 
 nored. True, the German vein current within the national 
 American body is less pretentious than those inoculated by the 
 Puritan, or the Scot or the Celt, but when we analyze the prod- 
 uct of the mixture and weigh its component values, we find 
 some of its best qualities traceable to German origin : Thorough- 
 ness, endurance, reliability in the pursuit of live tasks; aspira- 
 tions for ideals; artistic sentiment and the zest for mind culture. 
 
 "Many of the great inventions which have in the last century 
 revolutionized the world, have rooted in German inventive spirit, 
 while American pluck and enterprise have perfected them. On 
 the other hand, Americans engaged in gigantic financial, com-
 
 INTRODUCTION ""^ 
 
 raereial or industrial occupations are wont to look to Germany 
 for methods to give them economic strength. 
 
 "The interdependence of the two nations is well understood 
 and appreciated by all thoughtful and instmcted men. With 
 so much in common in the past and so many ties in the present, 
 an earnest collaboration in the work of civilization, education 
 and training, — to quote the words of a prominent American — 
 'Germany and America may well move forward in harmony, 
 each maintaining all its independence of method and thought 
 and action, yet both gaining strength from a better understand- 
 ing and mutual self-help by w^hich each may supplement the 
 needs of the other.' " 
 
 Germany herself, a generation ago, was an inefficient and ex- 
 hausted nation, and her progress and prosperity have been due 
 principally to sound statesmanship and the recognition the 
 country over of what could be learned from other countries. 
 
 The great lessons to be learned, especially from America, were 
 appreciated, and this policy is vigorously continued. German 
 students are sent the world over and return home with new 
 ideas to the great benefit of the countr3^ For example, four- 
 teen hundred Germans came over during the St. Louis exposition 
 in 1904 to study American methods, customs and business, to 
 be applied to German conditions wherever an advantage could 
 be found in doing so. 
 
 The enormous strides which Germany has made in the last 
 twenty years have served to place her in a position of leadership 
 among the nations of the world, and in making comparisons of 
 efficiency it will be necessary to draw a picture by no means 
 favorable to other countries, especially our own, not so much on 
 account of their lack of progress as on account of their failure 
 to progress at the rapid rate which Germany has maintained. 
 
 Frequent references to German accomplishments -wall thus 
 throughout be necessary even to the point of over iteration, but 
 they will be necessary in order to furnish a basis of comparison ; 
 for efficiency is not an absolute quality, but rather one that is 
 always relative and therefore one which must employ the most 
 efficient unit as the basis of comparison. 
 
 As has been pointed out by prominent English statesmen in 
 criticizing Germany, the German mind is of a certain robust 
 quality that thrives on criticism and consequently the Germans 
 are preferably engaged in energetic criticism of each other rather 
 than in criticism of outsiders. A criticism that is well taken is
 
 =^^iv INTRODUCTION 
 
 consequently regarded as an asset rather than an affront as it 
 points out a possible place where improvement may be made. 
 Thus every knock may be regarded as a boost. The tone of the 
 present work in its freedom of criticism is not, therefore, other 
 than of the most friendly character, and if it succeeds in indicat- 
 ing only one point at which improvement may be effected, it 
 will certainly have justified itself in every respect by the value 
 which vsdll accrue in the effecting of such improvements. 
 
 The enormous progress of Japan has been due to following the 
 example of Germany, and the Japanese found their most valu- 
 able lessons in Germany, where the experience of the world had 
 been accumulated. i 
 
 To-day Argentina and China are carrying out the same policy, 
 while even England is waking up. The movement in America 
 to take advantage of foreign conditions, though slow, is of con- 
 siderable extent. It must necessarily, however, be carried out 
 on a more elaborate and vigorous scale, and a thorough reorgani- 
 zation of internal conditions effected, if we expect to keep 
 abreast of the times.
 
 THE PRICE OF INEFFICIENCY
 
 THE PRICE OF INEFFICIENCY 
 
 CHAPTER I 
 THE SITUATION 
 
 National unrest — Falae conception of public duty — Public indifference 
 to official neglect — Bismark's remedy — Its stimulation of German 
 progress — Political isolation of the United States — Neglect of the 
 value of the experience of other countries — The duty of Americans 
 to America — Monopoly and progress in Germany — Co-operative na- 
 tionalism — Fundamental alteration of the attitude of the state 
 towards the individual. 
 
 The causes of the unrest which is the dominant motive in 
 American life to-day; of the social unrest, economic unrest and 
 the unrest of the losing struggle for existence; and the question 
 of remedies, if they are to be found, is forcing itself to the atten- 
 tion of everyone ; artisans and students, farmers and professors, 
 laborers and corporation managers alike. It is the principal 
 problem of government itself. 
 
 The question is continually arising; is this a government of 
 the people for the people by the people, or is it a government 
 of the indifferent and uninformed for and by the incompetent 
 and venal? 
 
 The dissatisfaction of the public extends from municipal gov- 
 ernment and local business affairs to the management of the 
 great trusts and the conduct of congress. 
 
 The distrust so evident is founded on the belief that public 
 officers and the managers of the great corporations, who are also, 
 in effect, public servants, have not as a class sought the truth 
 with a determination to act upon it for the public welfare, but 
 have avoided the broad road of public service for the by-paths of 
 personal profit. 
 
 The true relation between the public and those in high position 
 has been misunderstood nowhere as in America. Although the 
 phrase, **the servants of the public," is current freely enough,
 
 4 THE PRICE OF INEFFICIENCY 
 
 it is of little force and effect. Former Mayor McClellan of New 
 York, while in office, on being asked the name of his employer, 
 by an itinerant statistician filling a blank for some now forgotten 
 purpose, pointed to the city directory as a list of his employers. 
 Yet true as this was, no citizen there listed, nor the mayor him- 
 self, would feel that their relationship as employer and employee 
 was more than one theoretically so. Yet this mistaking of the 
 substance for the shadow is one of the real causes of present 
 conditions, as will be presently pointed out. 
 
 The feeling is that the public official has been elevated to a 
 great dignity, where he must trouble himself — and does — but 
 little as to the welfare of his employers. 
 
 The lack of virility in the attitude of the public towards 
 its public servants causes the public to be poorly served, and 
 w^hile the individual may realize that his best interests are be- 
 ing neglected by the men he has elected and is paying to serve 
 him, he yet takes no steps to improve matters. 
 
 He knows that wrong is being done; he is a victim and an 
 accessory as well, yet his conscience is not aroused. The con- 
 science of the public is asleep in fact, and while we feel things, 
 as individuals, we do not feel things as part of an effective pub- 
 lic sentiment. 
 
 Yet we are moral people. We uphold right and condemn 
 wrong, but the voice of effective remonstrance has remained 
 silent. 
 
 Only now, when the neglect of the public servants, whether 
 governmental or corporation, has led to acute conditions, is the 
 public rolling over in its sleep. 
 
 The whole country is in a condition, such as a business man's 
 business would be, if he spent his working hours attending to 
 something else. 
 
 To obtain from public servants the proper discharge of their 
 duties, it is necessary to subject them to criticism. In the words 
 of Bismarck, who said when in power : 
 
 "If the public would get what it wants, it must attack the 
 administration. ' ' 
 
 To the almost passionate acceptance and following of this 
 advice of Bismarck's, by the Germans, close observers ascribe 
 much of Germany 's present prestige as the leader of the progress 
 of the world. 
 
 That a public official in Germany is a public servant to be
 
 THE SITUATION 5 
 
 promptly criticized by the individual, a criticism, too, which 
 those in authority act upon, is a well recognized fact. There 
 the criticism of an official may cause him to quickly find himself 
 merely a member of the general public again; whereas in Amer- 
 ica the complaint would reach a pigeon hole and the citizen be 
 patronized as a crank, if not properly placed in an asylum. 
 
 The methods whereby the public may in this country attack 
 the government in the meaning of Bismarck's phrase, are ex- 
 tremely complicated and ineffective. An opinion can only be 
 had every second and fourth year, and at such times only be- 
 tween one of two groups of alternatives, so that in objecting to 
 one set of officials known as a party and in turning them out, 
 the set to go in while approved in the main issue cannot be pre- 
 vented from carrying in with them many subsidiary evils which 
 are not approved. A new four years of experiment must be 
 gone through with, only to be duplicated again after another 
 election. An administrative personnel of 412,000 officials must 
 be changed, which only includes the federal governmental body, 
 and the whole machinery of administration disorganized, while 
 these amateurs are learning a new trade, the tools of which they 
 must soon lay down again. 
 
 In solving the problem arising out of its own neglect, the pub- 
 lic must find out first, the causes, and then apply the remedies. 
 "What the causes have been and what the remedies are to be, 
 must deeply engage the attention of everyone who has either 
 his own interests or those of his country at heart. 
 
 And in reaching conclusions, the experience of other countries 
 will supply valuable lessons. The spread-eagleism of the past 
 is disappearing; America is a country among countries, not a 
 paradise among deserts, and the criticism of thoughtful for- 
 eigners on American conditions can only be welcome. 
 
 An Englishman, the Rev. Herbert W. Horwill, in the National 
 Review of London, v^rrites cogently: 
 
 "The necessity of making acquaintance with what is happen- 
 ing elsewhere in the world has been minimized for Americans, 
 until lately, by the political isolation of the United States. That 
 country has been spared, not only the entanglement of foreign 
 alliances, but also the educating influence of direct contact with 
 foreign problems. Its freedom from European complications, 
 however helpful on the whole to the development of its internal 
 resources, has certainly tended to circumscribe the ideas of its 
 people. Farther, in the Old "World, even if we are not able to
 
 6 THE PRICE OF INEFFICIENCY 
 
 go abroad, a constant appeal is made to the imagination by 
 visible memorials of past centuries. We can travel in time, if 
 not in space. "We have before our eyes, persistent reminders 
 that the civilization of the twentieth century is not the sudden 
 creation of our own contemporaries, or of a generation immedi- 
 ately preceding, but has been slowly built up by the genius and 
 toil of our forefathers." 
 
 To consider how other countries are meeting their problems, 
 and to adapt to the uses of America and to our conditions those 
 of their expedients and policies which have proved most suc- 
 cessful, and to learn from their failures lessons of value, is the 
 duty of Americans to America. 
 
 Among the states which in modern times have shown the 
 greatest energy and resourcefulness is Germany, and the 
 methods of Germany in dealing with similar problems will be 
 considered from time to time in greater detail, being of the 
 first importance, since Germany has made greater advances than 
 any other country in many respects, under, perhaps, the impetus 
 of greater necessity, new nationality and a dominant patriotism. 
 
 German aims, policies and conditions are well summarized in 
 an article, "Monopoly and Progress," by Dr. Franz Erich Junge- 
 Hermsdorff, a German consulting engineer and Doctor of Philos- 
 ophy, who resided in the United States for a number of years 
 and made a study of conditions here in the Engineering Maga- 
 zine of March, 1911, of which he states in part: 
 
 "Nothing common to man is foreign to nations. The story 
 of the prodigal son applies to families as well as to communities. 
 Thus in every people there is a natural inclination to prodigality, 
 but not every^ nation has a benevolent father ready to kill a 
 fatted calf, if waste and destruction have depleted its natural 
 inheritance. Germany is not a rich man's heiress. She must 
 prepare her children for adversity, not for prosperity, must fit 
 them to the lean years which are near, not for the fat years that 
 are promised in the future. Thus and thus only will they be 
 able to conquer the racking times which are approaching. 
 
 * ' Hence, to the prime rule of stragetic expediency dominating 
 our national household is coupled the other no less important 
 consideration of national economy, urging upon authorities the 
 supreme duty of guarding the country 's irreplaceable resources, 
 material and other, which joined with the subtle factor of civic 
 virtue are the pillars of every commonwealth. Having to support 
 sixty-five million active people on a territory four-fifths the size
 
 THE SITUATION 7 
 
 of Texas, and being fully aware of our geographic limitations, 
 of the precariousness of our central situation, of the scarcity of 
 raw materials at our avail, of our dependence for certain sup- 
 plies on foreign markets, and of the fact that in times of war 
 they will be cut off by our adversaries — scientific administration 
 and rational utilization of materials, emancipation from foreign 
 support, the development of high grade industries and agricul- 
 ture, and the exchange of gray matter for raw matter, are 
 natural correctives of our limited opportunities and logical di- 
 rectives for the industrial and commercial policy of the Empire. 
 "Leaving aside the political argument and speaking more par- 
 ticularly of the attitude of the state, the present policy of Ger- 
 many can be shortly defined as one of mutual partnership or co- 
 operative nationalism; that state and its government attending 
 to the more general and ideal, and the private individual to the 
 more special and material ends of the national business. In spite 
 of democracy pressing from without and of evolutionary philos- 
 ophy pressing from within, there is a growing tendency on the 
 part of the masses to rely on the state for support and inspira- 
 tion, making the national government both co-active and co-re- 
 sponsible for their welfare. And, even among conservative 
 statesmen, the leaning to-day is far more in the direction of 
 state socialism than in the direction of democracy. 
 
 ' ' This leaning on the paternal state is not wholly the result of 
 modern tendencies. It is a result, in part, of the traditional 
 policy of the Hohenzollern, radiating from Prussia ever since 
 they took over the control of the affairs of that country. It was 
 the proud boast of Frederick the Great that he was le roi des 
 guex. Of all the governments of the seventeenth century, the 
 Prussian was the first to seek the welfare of the whole commu- 
 nity. The "Landrecht" recognized the state as the protector of 
 the poorer classes, and the supply of sustenance and work for 
 those lacking means and opportunity of earning a livelihood as 
 one of its duties. It was upon these clauses that Bismarck re- 
 lied when, on I\Iay 7th, 1884, he declared to the Reichstag his 
 recognition of the laborer's right to work. His idea of social 
 reform, of the nationalization of railways, of state monopolies 
 in brandy and tobacco (not realized), even of the return to 
 protection, all spring from his profound conviction that "many 
 measures which we have adopted to the great blessing of the 
 countrj^ are socialistic, and the state will have to accustom itself 
 to a little more socialism yet." (1882).
 
 8 THE PRICE OF INEFFICIENCY 
 
 *'In this age of monopoly when, under the sway of commer- 
 cialism, the empire of business in all countries is encroaching 
 upon national governments, anxious to seize their privileges 
 without burdening itself with their responsibilities, the blessing 
 of a paternal policy for the weal of the state is making itself 
 especially felt. In reflecting upon American conditions, in this 
 relation, it should be borne in mind— as distinguishing between 
 our respective constitutional confederate systems — that in Ger- 
 many every one of the twenty-six states is really a sovereign 
 agency rendering public service, not merely a government or 
 administrative district. 
 
 "In Germany private monopoly could never reach such gi- 
 gantic proportions, because at the very outset of the industrial 
 age a big slice of the national assets was withdrawn from private 
 enterprise by the government, being reserved exclusively for 
 public uses and operated on a strictly socialistic basis for the 
 equitable good of all. The other major portion of the basic re- 
 source was, of course, left to exploitation and improvement by 
 private initiative. In the course of time and under the influence 
 of the economic revolutions in the neighboring European coun- 
 tries, especially England (Smith) and France (Colbert), the 
 attitude of the state towards industry has, naturally, under- 
 gone various changes. But to-day the general tendency, under 
 the pressure of the socialistic vote, is stronger than ever before 
 for an expansion of national co-operation under the leadership 
 of state or national government— representing a compromise, as 
 it were, between the mereantilistic and the physiocratic doc- 
 trines, between the individualist and collectivist schemes— an 
 attempt to infuse the cold reasoning of reckless commercialism 
 and the Utopian dreams of extreme socialism with the nobler 
 motives of national expediency, 
 
 "While the authority of the state is invariably supreme, its 
 functions are of the progressive variety, establisliing the balance 
 between all the productive and destructive forces of the land. 
 The state not only partakes in every form of private industry, 
 engaging in part of the three factors of production— nature, 
 labor'and capital,— but it extends its intervention in proportion 
 to the growing needs of the commonwonlth. Its functions of 
 service are quite as marked as its f unci ions of restraint, and, 
 with the standard of German citizenship on the ascendant, there 
 is, indeed, a tendency of diminishing restraint and of increasing 
 service. ' '
 
 CHAPTER II 
 OUR POLITICAL SYSTEM 
 
 The "servants" of the public — ^Are they underpaid? — What is the matter 
 with our state legislatures ? — Laws — Their supply and demand — 
 Poor quality of laws made by our legislators — When private inter- 
 ests pay the law-makers, who do they work for? — "Practical" men 
 in office — A national canker — German administrative processes — 
 Effectiveness of the bureaucracy — Why it succeeds — The constitution 
 of the United States as a governmental system — How it automatically 
 collects inferior congressman — Does it place a premium on demagogue- 
 ism? — How the constitution keeps the greatest men out of the presi- 
 dency — The Catholic, the Jew and the Atheist — Conventions as extra- 
 constitutional growths — How the "slate" originates — The roots of 
 graft — The origin of "pull" — Bosses and blackmailing laws — Every 
 voter with a private interest opposed to public policy — Automatic 
 opposition to good government — Log rolling — ^The constitution as an 
 instrument for favoring self interest as opposed to the general wel- 
 fare — Back yard patriotism — Confusion of differing state laws — 
 Great waste of deciding the constitutionality of laws — National con- 
 tempt for law. 
 
 That the public is poorly served by its servants; its officials, 
 employees and managers of vast corporations charged with a 
 public interest, is well understood. 
 
 The reason why is not so clear. 
 
 In the case of the great corporations, the fact that they are 
 new, and their true relation to the public not yet understood, 
 serves as an excuse, but for our public officials, they were graft- 
 ing long before grafting was a word in its present meaning. 
 They have, in fact, been serving their employers unfaithfully for 
 generations. 
 
 Perhaps the principal reason why the public is so poorly 
 served, is that it pays its servants starvation wages, compared 
 with what the talent demanded can obtain for an equal service 
 rendered to a private employer. 
 
 The greatest sources of governmental inefficiency are the legis- 
 latures of the several states. The salaries paid are eked out 
 by graft and near graft, by laws favoring blackmailing schemes 
 and laws favoring interests contrary to the public welfare, 
 
 9
 
 10 THE PRICE OF INEFFICIENCY 
 
 If the salaries of the legislators of New York state, for ex- 
 ample, were increased to $15,000 a year, instead of remaining at 
 $1500, the state would be out of pocket immediately some 
 $3,015,000, and this might seem an extravagance. But consider 
 the effect of an annual salary of $15,000. It would attract a 
 vastly better class of men to office. The present low grade ward 
 politicians could not secure election, since brighter men would 
 be after the prizes. Instead of incompetents, the legislature 
 would be filled with competents; with men better able to reach 
 proper decisions, and men able to see that the continuation in 
 the lucrative offices, held, would depend on how well they could 
 demonstrate to the public their fitness. 
 
 Considering the vast outlays authorized by legislators, the 
 mere exercise of bad judgment in a single instance by a legisla- 
 ture would and does constantly cost the state more than the 
 increased salaries of the legislators would amount to. 
 
 Without any question of graft or dishonesty, it is the part of 
 wisdom to pay the highest possible price for legislative services, 
 merely for the sake of efficiency, while morally, it is certainly 
 better for the state to pay the price of legislation and get it, 
 rather than to allow private interests to pay the price, as at 
 present, and get it. 
 
 Aside, however, from the question of being poorly paid, there 
 is a disconcerting lack of honesty among the servants of the pub- 
 lic; a sort of a "take it while you can get it" attitude, as though 
 an election to office were a license to plunder. 
 
 Why should this be so? 
 
 Why should the elected official be prone to graft and deals? 
 In a country whose principal boasts are of liberty and patriot- 
 ism, why such a general disregard of the rights of the public as 
 a whole, why so many "practical" men in office? 
 
 So inured, however, are Americans to the dereliction of pub- 
 lic officials, that to ask why a public official should not be honest, 
 is likely to be regarded as a naive stroke of liumor. The contrary 
 is so usual that it has become almost a matter of course. 
 
 But as a novel point of view, why not demand honesty of the 
 elected official, and demand it seriously? 
 
 The effects of official dishonesty are widespread and enor- 
 mously destructive, and while the importance of honest legisla- 
 tion cannot be over-estimated, the dishonest article continues 
 in evidence. Why is it? 
 
 Some canker finally kills every nation. Is the canker that
 
 OUR POLITICAL SYSTEM 11 
 
 will end American liberty, in early evidence now, in the bad 
 faith of legislators? Can it be chopped out and a new groAvth 
 stimulated, or is it characteristic of the whole tree? Such lack 
 of patriotism in a free country is surprising to the foreigner. 
 In Germany, for example, such conditions do not exist. That, 
 at any rate, is not the German canker. 
 
 Office is held in Germany, mainly by the bureaucratic class. 
 
 They serve for a reasonable compensation, but render a high 
 grade of service. Their motive is patriotism, the honor of serv- 
 ing their country. They would no more think of grafting than 
 a private soldier in the army of Grant or Sherman would have 
 thought of putting his hand in his general's pocket and taking 
 his watch or money. 
 
 The success of this system of administration depends on the 
 moral and intellectual qualities of the individuals composing 
 the government. It stands and falls with decent officialism. 
 If corruption and commercialism ever claim the bureaucracy, 
 if public servants place gain above honor, the whole system 
 will become rotten. 
 
 But against this possibility is the fact that honesty in the 
 public service is held in high esteem by public sentiment, and 
 this pronounced and appreciative endorsement of official integ- 
 rity, as much perhaps as the quality of the personnel itself, calls 
 forth and keeps uncontaminated the highest qualities in the 
 official. 
 
 Although highly extolled, and rightly so, as the bulwark of 
 liberty, the constitution of the United States is far from being 
 a perfect political instrument. The system of requiring the res- 
 idence in the congressional district of its representative in 
 congress, has the effect of collecting at Washington biennially 
 a large number of inexperienced and incompetent legislators, 
 often persons of the smallest capacity, who look upon their term 
 of office as a temporary adornment, and who have no thought 
 of making law-making a seriously considered business, nor any 
 capacity whatever for the making of laws. 
 
 The United States thus has its laws made largely by the tyros 
 who happen to be in office. An experienced, capable and bril- 
 liant public man is likely to be retired at any moment through 
 a change of political sentiment in his district, and thus there is 
 no incentive to a systematic study of government on the part 
 of those who govern. 
 
 The system has the effect of producing, and placing a high
 
 12 THE PKICE OF INEFFICIENCY 
 
 premium upon men who have the ability to get elected, regard- 
 less of their ability to make laws. The careful and painstak- 
 ing legislator, of judicial mind and broad views, whose services 
 the country should have in the making of laws, gives place to 
 the blatant demagogue who can influence a crowd ; for the real 
 law-maker and statesmen is not likely to be the man to arouse 
 the passion and prejudice which go to decide the issue of an 
 American election. 
 
 It is undoubtedly true that only accidentally does a really 
 great man become president of the United States. Our presi- 
 dents are more than likely to be neutral persons. Too often a 
 president is the resultant of forces of which he is not one; a 
 person crafty enough to float with the tide and conventional 
 enough to be in harmony with the intensely conventional views 
 of the electorate; that is to say, a man in whose armor the 
 demagogues of the other side can find no opening. 
 
 No Catholic can become president of the United States, no 
 Jew, no atheist, no Southerner and no philosopher however 
 great; not because they could not be elected, but because they 
 could not be nominated for office by any great party for fear of^ 
 the demagogues of the other. 
 
 In the nominating of candidates for office, a system entirely 
 extra-constitutional; a system that begins before the constitu- 
 tion begins and which the authors of that instrument never 
 dreamed of, has evolved itself, greatly to the shame and dis- 
 credit of republican institutions; and a horde of persons known 
 as bosses has come into being ; a boss for each city and each state, 
 and these are the real rulers of the United States. 
 
 Candidates for smaller offices are selected by a method of two 
 steps. The first is a convention of delegates who meet and are 
 supposed, of their own free will, to select candidates. As a 
 matter of fact, a selection of that kind seldom occurs. Usually 
 the boss of the locality makes up what is called a "slate" or list 
 of candidates loyal to him, and they are nominated by the con- 
 vention without murmur, unless a second boss is aspiring to 
 the power of the ruling boss, when a test of strength between 
 the rival bosses comes before the convention, and the winning 
 "slate" is carried through. With the exception of sporadic in- 
 dependent candidacies, the real contests over offices are confined 
 to the struggles of the bosses. 
 
 From whence do the bosses who rule us derive their power? 
 They are rarely elected officials, but they dictate the selection
 
 OUR POLITICAL SYSTEM 13 
 
 of every official. How do they manage to make themselves the 
 rulers of America, to constitute themselves a nominating Trust? 
 Again through a bad system, that of conventions. 
 
 The convention was originally a to^Yn. meeting, which all might 
 attend, and at which all citizens might vote. In such a meet- 
 ing, a man of influence, one with many friends, would naturally 
 carry many measures through the support of his friends and his 
 own prestige. Such was the origin of the boss. He is a man of 
 many friends. He makes a business of having as many friends 
 as possible, and of looking out for his friends and having his 
 friends look out for him. 
 
 It would thus appear that America is ruled by a class of men 
 of a friendly disposition. So it is, but this friendship is not 
 exercised towards the public, but on the contrary, directly in 
 opposition to the public welfare. 
 
 Each of the great parties is thoroughly organized. Every dis- 
 trict has its political club and its political workers, or minor 
 politicians who mingle political activities with their ordinary 
 business. Among the workers in each club is a leader, ostensibly 
 elected by the club, but in reality the one among the club hav- 
 ing the greatest ability in doing favors for others and in mak- 
 ing them expect further favors. This local leader then busies 
 himself in getting solid with greater leaders and other promi- 
 nent politicians, so that when the time comes for a convention, 
 through his real or supposed influence or pull, he is able to say 
 which of the workers shall go as a delegate to represent that dis- 
 trict. Such a delegate represents, consequently, not the voters 
 of the district as he should, but the interests of his leader. Thus 
 the convention is controlled by the main boss, acting through 
 the lesser bosses, the main boss having evolved himself from a 
 minor to a major position by his ability as a politician in mak- 
 ing friends and gaining influence, by getting favors for his 
 friends and then being able to deliver the votes of the delegates. 
 
 When a convention is held, the candidates are thus the pup- 
 pets of the bosses, and the second step is then in order, the 
 primary or initial or nominating election. At such a primary, 
 which is where the constitution begins, the voters of a party are 
 entitled to vote on the question of who shall become the candi- 
 dates of the party at a later election. The primary is only of 
 use in determining disputes between the "slates" of rival bosses 
 who are unable to overcome each other at the convention. 
 
 A fundamental change, however, is gradually coming over
 
 14 THE PRICE OF INEFFICIENCY 
 
 American politics, in that tlie direct primary is being established, 
 the primary prior to which no candidates are indicated. The 
 importance of the direct primary issue is not well understood 
 by the voters generally, but it presages entirely new political 
 conditions. 
 
 The candidates for the higher offices, president, governor and 
 the like, are selected by party conventions, with delegates from 
 all parts of the country or state, there being no primaries for the 
 higher offices, the bosses controlling entirely. 
 
 There is as yet no boss for the whole United States of either 
 party, since owing to the distinct organization of the states, the 
 boss of one state gains no power in the other states, though 
 supreme locally, yet there have been presidents who owed their 
 nomination to the single favor of some other man. 
 
 A national convention is thus a struggle between groups of 
 state bosses behind the curtain. The president in office usually 
 has great weight and can do much to influence the result of the 
 convention, but more often than not, the convention develops 
 rivalries which can only be settled by the nomination of a dark 
 horse, a candidate not at first considered and too often a man of 
 minor abilities. 
 
 While this is a result that is deplorable it is not as much so as 
 the situation in which the oppositions are so intense as to cause 
 the rival candidate to continue in the field, organizing, when 
 the occasion demands it, new parties, the result of which is 
 simply to ensure each other's defeat and the putting in power 
 of the candidate of another party who may represent only the 
 desires of a minority of the electorate. 
 
 Spectacles of this kind discredit not only those who engage 
 in them, but our methods of government, both in our own eyes 
 and in the eyes of the world. 
 
 The most pernicious results of the boss system are seen, how- 
 ever, in its local manifestations. The local boss spends his time 
 in looking after the interests of his district. If a criminal is 
 released, he finds him work and gains a friend. If a man is ar- 
 rested, the boss gets a bondsman for him and gains another 
 friend. The little boss, through his pull with a more important 
 boss, who selected the mayor who appointed the chief of police, 
 succeeds in paralyzing the law which would reach a third man. 
 A new friend is gained. A harsh law is slipped through the 
 legislature. Business men cannot comply with its requirements. 
 They evade it and contribute to the political organization, and
 
 OUR POLITICAL SYSTEM 15 
 
 the boss gains new friends perforce, and added power as well. 
 The women of the street are blackmailed ; saloons and gambling 
 houses pay unofficial licenses to the organization and law after 
 law goes on the statute books designed only to furnish means for 
 added power and influence for the organization. Fat offices and 
 commissions are created furnishing easy berths for friends of 
 the boss, and these offices affect all classes of business, so that 
 politics has a finger in every pie. This is politics in business 
 and is called patronage, and since the holders of these fat offices 
 and all their minor employees are kicked out if the other party 
 comes into power, they devote most of their time to politics, that 
 is to increasing the power of the organization in its manifold 
 ramifications. 
 
 Contractors for vast public works or great private undertak- 
 ings find it advisable to have in their firms certain politicians, as 
 otherwise contracts would be lost. Financiers wishing public 
 franchises supply funds to both the gi'eat parties, thus being 
 sure of friendship of the right sort, irrespective of the whims 
 of the voters and the fortunes of election day. This is business 
 in politics. 
 
 Such conditions exist locally, in the states, and nationally, 
 and the boss of each state has not alone the local patronage, but 
 his share of the national patronage and graft, graft being the 
 fat contracts and other perquisities both legal and illegal which 
 have grown up. 
 
 A vast system thus exists, through which a large proportion 
 of the voters are reached, directly or indirectly, through some 
 form of contract of personal friendship or interest, and each 
 voter votes for his own interest as an indi\idual or the interest 
 of a friend as against real public policy. The whole political 
 organization of the country thus works automatically against 
 good government and in favor of graft and dishonest adminis- 
 tration, while the whole thing is entirely outside the constitu- 
 tion and opposed to liberty, progress and the true interests of 
 all concerned. 
 
 The control of the legislatures in this manner, results in both 
 national and state laws which are detrimental to the public wel- 
 fare. The system rules through fear, favor and graft, and is 
 most notoriously in evidence in the state legislatures where grab 
 bills, in which valuable franchises are disposed of for a pittance ; 
 ripper bills, cutting the other party's office holders out of office 
 and reducing the civil service list; and jokers, or hidden provi-
 
 16 THE PRICE OF INEFFICIENCY 
 
 sion for ulterior purposes in various bills, are frequently in evi- 
 dence. 
 
 City government is worse than state government, and the 
 national government, in a different way, is worse than either, for 
 owing to the intense light of publicity and its vaster machinery 
 though it is not so dominated by bosses, it is subject to a certain 
 financial overlordship, which will be described later. 
 
 In addition, there is in the national government a defect 
 due to the constitutional organization of the government, which 
 works out to the disadvantage of the country as a whole, to an 
 enormous degree, dwarfing the vermin-like activities of the local 
 politicians. It is known as log rolling and is worthy brother to 
 the "pork barrel." It affects first of all tariff legislation, the 
 most important of all legislation. 
 
 The tariff is not in reality an American institution. It does 
 not represent the real feelings of Americans, but it is a resultant 
 of various special interests. 
 
 The cotton manufacturer of New England wishes a tariff but 
 the public does not; the farmer in the west wishes a tariff on 
 wool, but the public v/ants cheaper clothing; the lumberman 
 wants a tariff on lumber but the public wants cheaper houses; 
 the iron manufacturer wants protection, the public cheaper 
 nails; the planter in the south wants protected sugar, the public 
 free sweets, and thus each section of the country has its own 
 special interest for which it wants protection, while the public 
 as a whole prefers free trade. 
 
 The sectional interests, when represented in congress, are 
 forced to stand together. If the farmers' congressman threatens 
 lower tariff on sugar, the planters' congressman demands cheaper 
 clothing, and if the lumberman wants cheaper nails the iron 
 manufacturer will ask for cheaper wood. Thus they stand in 
 mutual fear and necessity of each other; and without graft, 
 bosses, big business or any suspicion of any of them, the country 
 is automatically forced into high tariff by the striving of each 
 sectional interest for sectional advantages. The result is that 
 the representatives in congress assembled get close together and 
 each allows the other the desired advantage on condition of re- 
 ceiving his own advantage, and the rumble of the log rolling 
 seems to disturb no one. 
 
 Likewise the ' ' pork barrel. ' ' 
 
 Public buildings, particularly post office buildings, abound in 
 the United States, all built by the national government. Small
 
 OUR POLITICAL SYSTEM 17 
 
 towns have great federal edifices, out of all proportion to their 
 needs, while others have only a rented store. It all depends 
 on the political complection of the district. If a congressman is 
 elected, belonging to the dominant party, and the congressman 
 is a man of ability, he "gets busy" for his constituency, and 
 grabs all he can of the funds of the whole country to be ex- 
 pended in his own district, either in post offices or other public 
 works, such as river and harbor improvements, canals and levees, 
 which are always built by the national government. 
 
 He does not care about the rest of his country, if his own sec- 
 tion fares well and he can return to the voters and say; "See, 
 not what I have done for the country, but what I have done for 
 you." This system of apportioning public improvements for 
 selected localities out of the public funds; which is accomplished 
 by coteries of influential congressmen grouping together in cer- 
 tain combinations for the benefit of their own localities, shutting 
 out the opposition and the less influential congressmen of their 
 own party, is termed cutting the "pork barrel." It is a vast 
 abuse, and one of the greatest sources of waste and extravagance 
 in America. It is a direct and inevitable outcome, however, of 
 the American governmental organization as laid down in the 
 constitution, and one of the things which the framers of that 
 instrument, in their abounding wisdom, failed utterly to foresee. 
 
 In the formation of the republic, the framers of the constitu- 
 tion were compelled to take particular care to preserve the 
 rights of the several states ; which were at that time to a degree 
 that can now hardly be determined, separate states or countries. 
 The term United States has become the name of an entity, and 
 not, as at first, the description of a union. 
 
 If we imagine, for a moment, the various countries of Europe 
 forming the United States of Europe, it will be appreciated what 
 difficulties the framers of a constitution for such a country 
 would encounter. 
 
 The framers of the constitution of the United States of Amer- 
 ica had a task of but little less difficulty. Nevertheless, the 
 United States as an entity and not as a coalition did not at first 
 exist. 
 
 With the passage of time, the idea of the union as an entity, 
 and not as a thing of discrete parts, became established, until 
 now, the fact that the states were once sovereigns has entirely 
 been lost sight of. The states are now merely political divisions 
 and the American is a citizen of the United States, and has very
 
 18 THE PRICE OF INEFFICIENCY 
 
 little more patriotism for his particular state as such than he has 
 for his back yard, and takes much less interest in it than he does 
 in the baseball club representing his city. 
 
 The organizations of the state governments continue, however, 
 with considerable vigor, though constantly being deprived of 
 powers by the federal government through supreme court deci- 
 sions. 
 
 Great confusion is caused by the fact that the governor, state 
 senate and assembly, and the judiciary of the several states are 
 duplicates in each state of the federal organization, while each 
 state has its own constitution. The federal government has 
 charge of certain matters, such as the coinage of money, the 
 post office, collection of duties, the army and navy; while the 
 states, in addition to their own internal affairs, regulate the con- 
 duct of their citizens in their personal affairs and are supreme 
 in matters of divorce, punishment of crimes against persons and 
 property and the maintenance of courts for certain classes of 
 cases. A highly complex and cumbersome system of legal ma- 
 chinery thus exists and contradictions are innumerable. Thus 
 an act which is a crime in one state is an innocent diversion in 
 another, but as each state must give credence and effect to the 
 laws of its neighbors, it happens that for example, a man in 
 New York may have no legal right to re-marry through being 
 the guilty party in a divorce action, yet he may re-marry in 
 another state and return to New York, being protected by the 
 uredence New York must give to the laws of the other state. 
 
 Similarly, a man may be legally sane in one state and legally 
 insane in another, he may have a legal residence in one state 
 though actually living in another and escape taxes in both, and 
 he may be legally dead in one state and alive in another. If a 
 criminal escapes to another state, no power can return him to 
 the state in which he committed the crime unless the governor 
 of the state in which he has taken refuge wishes to have him 
 returned. Not even the federal government can intervene, and 
 the right of sanctuary in ancient times was no more complete 
 or sacred. The states are thus supreme in certain legal matters, 
 though having no place in the popular thought as separate coun- 
 tries. 
 
 All of this produces vexatious results, entails endless actions 
 at law and permits the perpetrations of much injustice. The 
 whole of England has fewer judges than the state of New York 
 alone, and America is a paradise for lawyers. The individual who
 
 OUR POLITICAL SYSTEM 19 
 
 has committed a crime has so many loopholes of a legal nature to 
 crawl through, that convictions are extremely difficult to obtain. 
 The law's delays in civil cases are long and trying, and the Eng- 
 lish system is followed which adds further complications. Prec- 
 edents are followed, including those of old English common 
 law, and the attorney who can dig up the most precedents usually 
 has the better of the argument in court, as judges prefer not 
 to take positions contrary to those of earlier decisions. 
 
 This complex system of state and federal laws is highly waste- 
 ful, and the body economic must support the army of judges 
 and lawyers who might otherwise be engaged in occupations 
 better suited to the public welfare. 
 
 Another cause of much injustice and delay, amounting to 
 a denial of justice, lies in the testing of new laws. Congress or 
 a legislature passes a law, but it is not in reality effective until 
 after the courts have decided its constitutionality, that is, 
 whether or not it agrees with the constitution. 
 
 Whether or not a given measure will prove constitutional is 
 not given much attention by legislators. The law is passed, 
 whether good, bad or indifferent, and the courts must exercise 
 all their profundity to ascertain what the law makers meant to 
 say, and then decide whether they had the right to say it. And 
 further, if the law is not in accord with public sentiment, judges 
 construe it so narrowly that it loses its force. If a new law 
 looks like a living thing and has the support of public sentiment, 
 judges mete out punishment to the luckless offender against 
 the new statute, until finally someone, who has committed the 
 new crime by an act which was not previously a crime, is en- 
 countered who is sufficiently wealthy and pugnacious to make 
 a constitutional case of it and it then goes to the higher courts. 
 
 Often, however, no test case coming up in the natural order 
 of events, an attorney or an association of some sort, by arrange- 
 ment with the court, has an offender arrested for the express 
 purpose of testing the constitutionality of the law; that is to 
 say, of finding out whether the law-makers have really made a 
 law or only another dead letter. In the case of the more im- 
 portant laws, repeated constitutional tests will be inaugurated, 
 based on different provisions of the constitution and if the law 
 does not square with all of them it is of no force or effect. 
 
 Thus, under the most favorable circumstances, it is several 
 years after a law has been passed that it really becomes a law, 
 if it does at all, and in many cases ten to twenty years elapse
 
 20 THE PKICE OF INEFFICIENCY 
 
 before the offenders cease to question a law's constitutionality. 
 The number of laws declared unconstitutional, also, is very large, 
 and thus endless confusion and uncertainty exist at all times in 
 regard to many laws, with the legislatures constantly grinding 
 out new ones to continue the farce. This ridiculous and clumsy 
 system with its intolerable delays, entails enormous losses and 
 clouds with uncertainty and discourages entirely, countless trans- 
 actions. 
 
 It has a further effect of inculcating a contempt for law, so 
 that the United States has more laws and fewer law abiding 
 citizens than perhaps any country on earth. There is small fear 
 of the law in the United States. With 44,000 new laws in 1910, 
 no one can keep up with them, and the chances of a law breaker 
 with a clever lawyer are very promising; much better in fact 
 than for example in Canada, where laws are much less numerous 
 and much more highly respected. 
 
 The effect of such a great number of laws is shown in the 
 increasing extent of the law's delays. 
 
 Justice Howard of the Supreme Court of New York, states 
 in a letter to Senator L. M. Black of Brooklyn, published Feb. 
 23, 1912: 
 
 ' ' There are too many laws, too many courts, too many appeals, 
 too many technicalities. Nobody knows the law, nobody can 
 know the law. In these days a law library would fill a barn. 
 The human mind cannot comprehend such a mass of stuff. And 
 its bulk is increasing at an appalling rate. Judges, Governors 
 and legislators are working at a feverish pace making law books. 
 Thousands of thick volumes constitute the written law. A dozen 
 volumes ought to contain all the laws of the State. 
 
 "Five Appellate Courts are in session at the same time in 
 this State, rendering decisions and writing opinions, necessarily 
 and in fact, in conflict with each other. One Legislature makes 
 a law for the guidance of the people ; the next Legislature repeals 
 it. A Governor advocates the passage of a law and then in a 
 few months urges its repeal. Under such conditions, who can 
 know the law? 
 
 "The law should be firm and positive; it has come to be like 
 quicksand, and slips faster than you can place your feet. This 
 uncertainty of the law propagates litigation; it breeds lawsuits. 
 Its havoc upon the tax-payers is frightful. In a large percent- 
 age of cases it costs the public more to foot the bills of the litiga- 
 tion than it would to pay the claim in dispute.
 
 OUR POLITICAL SYSTEM 21 
 
 "An old maxim says: 'Every man is presumed to know the 
 law.' But how absurd the saying is now. Nobody can know 
 a mass so discordant. The citizens cannot know the law, the 
 laA^^^ers cannot comprehend the law, the judges cannot interpret 
 the law. The Roman maxim might be modified so as to run: 
 'Ignorance of the law excuses no one — except the judges.' " 
 
 Respect for law in Germany is much greater than in the 
 United States, and the law is greater than the individual. An 
 example of this was seen recently in the arrest of the chauffeur 
 of the Imperial Chancellor, Dr. von Behrmann Hollweg, while 
 driving the Chancellor post-haste for an audience of the Kaiser. 
 The chauffeur was fined five dollars. A similar fate befell the 
 chauffeur of the Crown Prince while driving the latter, although 
 the appearance of the Crown Prince as a witness in court, con- 
 troverting the rate of speed alleged by the arresting officer, saved 
 the fine. 
 
 We manage these things better in America, where the chauf- 
 feur of a city official or alderman may well feel aggrieved if 
 he does not receive an apology from an officer who makes the 
 blunder of interfering with his progress. The President, when 
 he goes automobiling, on campaign and other tours, instead of 
 attending to governmental affairs and serving the public at his 
 post in Washington, is accustomed to make from 30 to 50 miles 
 an hour, for which he is praised by the newspapers, who thus 
 perhaps find justification for running their own delivery wagons 
 and automobile trucks through the crowded streets at fire de- 
 partment speeds. If the President and other officials and near 
 officials can make such speeds in contravention of law, certainly 
 in a countiy where everj^body is equal, a mere newspaper's 
 wagon may do the same. 
 
 The economic effect of legal delays is that of vast waste, 
 and its correction will be a slow and tedious work. All political 
 influence is in favor of the law's delays, and the injured citizen 
 rarely has even public sentiment on his side, being regarded as 
 a kicker or a grouch and being listed in the police squeal book 
 or squawk sheet, if he makes too insistent a stand for his com- 
 mon rights. Like the worms which riddle the piling of harbor 
 bulkheads, our vast army of lawyers are undermining the whole 
 social structure. They are a national pest and extravagance, 
 and the country would be blessed if law schools were closed for 
 a generation to let the course of nature eliminate the superfluity.
 
 CHAPTER III 
 ADMINISTRATIVE WASTE 
 
 Economy not a national slogan — How indirect taxation fosters extrava- 
 gance — Governmental inefficiency costs $1,000,000 a day — Where the 
 money goes — Squanderings of the post office — The pension office leak 
 in the pipe line of revenue — The citizen has no right to use the mails 
 • — It is a privilege granted by the post master general — Growth of 
 official autocracy — Constant effort of officialism to increase its powers 
 — Inefficient business management of the post office — The real inward- 
 ness of the fraud order — Contrast with efficient governmental methods 
 — Technical advisers to German ambassadors — How Germany skims 
 the cream off the world's technical discoveries. 
 
 Economy is not one of the American virtues; it is not a 
 ruling passion and the word inspires no answering heart throb. 
 In short, economy is not popular, and the economical are too 
 apt to be dubbed ''tightwads." There being little economy in 
 the individual, little can be expected in public life, for the 
 public servant in America, as elsewhere, gives only what serv- 
 ice is demanded. 
 
 No president desires to go down to posterity as an apostle 
 of economy. Even great financiers prefer to be known by large 
 dealings rather than by close acquirings. No congressman can 
 arouse the enthusiasm of his constituents at the following elec- 
 tion by recounting his exploits in cheese paring. Economy is 
 not the watchword of the day, much less of the night. 
 
 Yet even the spendthrift has moments when the complacency 
 of the economical, founded on a snug surplus, may well be 
 envied. The United States is passing through such a period. 
 Loud protestations of economy are being made. The official 
 . neighbor is blamed for expenditures, and while economy is of 
 no great value as a slogan, the accusation of extravagance made 
 by the demagogues of the other side is disagreeable campaign 
 
 shrapnel to dodge. 
 
 Administrative extravagance in the United States arises, how- 
 ever, not alone out of the natural sentiment of the public, but 
 out of other important considerations as well, among them be- 
 
 22
 
 ADMINISTRATIVE WASTE 23 
 
 ing the short official tenure of office, the difficulty of placing 
 responsibility for extravagance, lack of co-ordination between 
 branches of the government, lack of incentives to economy, and 
 the systems of indirect taxation which are such that the individ- 
 ual pays without knowing how many of the pennies of his dol- 
 lar go to the government, and without knowing what they are 
 spent for. 
 
 The extent of administrative waste is so vast that it can 
 hardly be conceived. According to Senator Aldrich, not less 
 than $300,000,000 could be saved yearly if the government were 
 run on a business basis. Even if congress and the administra- 
 tion would work in harmony instead of constantly seeking polit- 
 ical advantage, not less than $100,000,000 could be saved an- 
 nually, or 10% of the government's total expenditures of 
 $1,000,000,000. In an admirable article on the subject, "How 
 a Business Man Would Run the Government," by A. W. Dunn 
 in the World's Work for June, 1911, the following is given as 
 an approximation of where the saving could be effected: 
 
 Consolidation of military posts and other army reforms.. $25,000,000 
 
 Consolidation of navy yards and general naval economy.. 25,000,000 
 
 Purging pension rolls 40,000,000 
 
 Post Office economies and reforms, resulting in increased 
 
 revenue 50,000,000 
 
 Public buildings 25,000,000 
 
 Rivers and harbors 25,000.000 
 
 Reforms in departmental bureaus 25,000,000 
 
 Congress 2,000,000 
 
 Cutting of courts, commissions, bureaus 3,000,000 
 
 Traveling expenses, junkets, etc 5,000,000 
 
 Inspection and special services 5,000,000 
 
 Miscellaneous 30,000,000 
 
 Total $250,000,000 
 
 "The estimates are approximately on the basis of the cost 
 of the government before the great era of extravagance began. 
 It may be found that in several instances the estimates are too 
 high, and in others too low, but the figures will serve as a good 
 working basis. 
 
 "They do not touch upon the expenditures for interest or 
 the payment of the public debt or for the building of the Pan- 
 ama Canal. In the eight years between 1902 and 1910, the ex- 
 penses of the army increased $43,500,000; of the navy, $55,- 
 750,000, of the pensions $22,000,000, and of the whole govern-
 
 24 THE PRICE OF INEFFICIENCY 
 
 ment, between $290,000,000 and $300,000,000. Such fibres 
 help to show approximately in what items savings can be ac- 
 complished and how large the savings might be." 
 
 What does $300,000,000 a year mean? 
 
 For one thing, it means $16.50 for each household, or five 
 time as much as the average governmental income taxation of 
 the family head in Germany. 
 
 Each family in the United States thus contributes $16.50 
 a year, so that the government officials will not feel stinted. 
 
 The amount of \vaste annually would pay the schooling of 
 fifty thousand young men in college or industrial training 
 schools. This w^ould be a larger number than the entire student 
 body matriculated at a dozen of the largest universities of the 
 country. 
 
 It would establish in every city of the United States having 
 a population of 25,000 or over, every year, an additional mil- 
 lion dollar factory, and leave seventy-five more such factories 
 for still smaller towns, and give employment to many thousands 
 of workers now in enforced idleness. 
 
 The two principal items in which great savings are possible 
 are the pension and post office expenditures. The vast ex- 
 penditures for pensions, increased in 1912 to $173,000,000 a year, 
 are a burden which part of the public bears for the benefit of 
 another part, and M^hich has been carried so long that it has be- 
 come a habit. Inherently, however, it is another evidence of 
 the lack of respect which the citizen of a republic feels for the 
 form of government which he so loudly extols. Everyone in 
 America is willing to die for his country, if need be, but if he 
 escapes a military funeral, he returns to private life with his 
 sense of patriotism fully satisfied and ready to draw a pension 
 on the flimsiest of pretexts. He respects his country's flag but 
 the treasury is an entirely different matter. The vigor with 
 which he fought the enemy in battle is now directed towards 
 procuring a pension, and such is the success met with in this 
 field, that in the case of the Spanish war in wliich the total 
 number of casualties was but 9378 and the killed but 698, out 
 of an enlistment of 312,000, there are now pensioners on the 
 rolls more than the whole of Shafter's army, and in fifteen 
 years there will be, at the present rate of increase, half as many 
 pensioners as the entire enlistment. 
 
 The average pensioner who is drawing a pension that he is 
 not truly entitled to, feels he has turned a rather clever trick
 
 ADMINISTRATIVE WASTE 25 
 
 on Uncle Sam. That his quarterly instalment is a species of 
 pocket picking of the collective pocket of his neighbors, does 
 not occur to him, or if it does he is not much troubled. There 
 is in America little of the patriotism of honesty towards the 
 government. It is a great grab bag and he that grabs most 
 grabs best. 
 
 No one questions that the great majority of pensioners are 
 justly on the rolls, that there are great numbers of veterans to 
 whom the pension is the only stay and sole support. To these 
 no one would deny the stipend. But under cover of their neces- 
 sity, a great number of pensioners have gotten on the rolls ; fake 
 veterans, bounty jumpers, impersonators, camp followers, de- 
 serters, malingerers and bogus widows. The method of grant- 
 ing pensions by bills introduced by congressmen, has the effect 
 of giving the congressman the greatest possible incentive to 
 padding the pension rolls, since every pension obtained places 
 the pensioner, if not the members of his family, under a debt of 
 political gratitude. It is another phase of the political system 
 which builds public buildings where they are not needed and 
 improves rivers and harbors unnecessarily, another example of 
 a public treasury which is without legislative guardians and in 
 which all the keepers of the treasury have every incentive to 
 squander and none to preserve. 
 
 During the discussion of the proposed pension appropriation 
 for 1912, among the protests against the extension of pension 
 waste was that of Representative Callaway, who said: 
 
 '*I have a bill here introduced by the genial gentleman from 
 Iowa (Mr. Pepper) for Thomas Brown. Gentlemen will 
 find it on page 38. He is 64 years old now. He must have 
 joined the army when he was only 15 years of age. I do not 
 understand how he got in at that age. On looking at the laws 
 I find that a person could not enlist until he was 17, but accord- 
 ing to this statement, he got in when he was 15. He enlisted 
 on the 10th of May, 1864, stayed in the service until the 24th 
 of September, 1864 — four months and fourteen days. 
 
 "He has draAvn a pension of $12 a month from 1890 until 
 now, and this bill proposes to increase his pension to $24. He 
 was never in a battle. He never received any injury from the 
 service whatever according to the statement and I take it that 
 it is made as favorable to him as possible. He has already 
 drawn from the government for that four months' service, 
 $3,312, and if he lives after this bill is granted as long as an
 
 26 THE PRICE OF INEFFICIENCY 
 
 ordinary pensioner is expected to live, twenty years, which will 
 make him 84^he will draw $5,760 more, or a total of $9,072 
 from the government for four months' summer service in the 
 army when he never was in a battle, according to the statement 
 and cannot trace any of his disabilities to service in the army. 
 
 "But that is not the worst part of it. I see from this report 
 that he owns a one-third interest in a homestead worth $3,000. 
 He is worth more, ]\Ir. Speaker, than 75% of the voters in this 
 country. Besides that, he has a yearly income of $180. We 
 propose now to give this man a pension, in addition to the $12 
 he is already getting, of $12 more, making it $24 a month, IVIr. 
 Speaker, and saddle that on the voters of this country, the tax- 
 payers of this land, the widows from one end of the Union to 
 the other, who have to work for their living, and 90% of them 
 are in a worse condition financially than he is." 
 
 The total cost of the Civil War is estimated at from 5,500 to 
 6,000 millions, but pensions approximating 4,000 millions have 
 already been paid and it is estimated that before the last pen- 
 sioner is removed by death, the pensions will have equaled the 
 cost of the war. 
 
 While the burdens of the standing armies of Europe are a 
 fruitful source of reproach, the cost to the United States of the 
 standing armies of pensioners is much greater than the cost 
 of four of the greatest pension armies of Europe, namely those 
 of Austria-Hungary, France, Germany and Great Britain 
 which total less than $100,000,000. 
 
 One of the causes of the great number of pensioners lies in 
 the fact that most of the wars of the United States have been 
 fought with soldiers and officers Avho at the outset were amateurs 
 in the art of war. Including the Revolution, the number of 
 regulars has been 549,115, compared with 3,686,175 volunteers, 
 and excluding the Revolution, 317,344 regulars to 3,522,058 
 others. This accounts for the great losses from invalidism and 
 an increase of pensions subsequently. 
 
 As the regular soldier is not the pension hunter that the 
 militiaman afterwards becomes, and as the losses of the regulars 
 are not so great, a safeguard against pension waste in the fu- 
 ture lies to a certain extent in an adequately trained skeleton 
 of regulars. 
 
 More, however, lies in a new system of granting pensions in 
 which the just claimant may have justice done, and the fact 
 that he is a voter has no bearing on the case. In short, pen-
 
 ADMINISTRATIVE WASTE 27 
 
 sions must be taken out of politics and politics out of pen- 
 sions. 
 
 The post office department of the United States has powers 
 more autocratic and inquisitorial than perhaps any department 
 of the government, if not of any governmental department in 
 any civilized country. 
 
 No citizen of the United States has any right to receive a 
 letter, or have a letter delivered when mailed by him, except at 
 the pleasure of the department. The courts have decided that 
 the use of the mails is a privilege and not a right. Thus citizens 
 who are taxed for the maintenance of the system are not entitled 
 to use it. The officials of the department, if they decide that 
 a business is being carried on in what they decide is a fraudulent 
 manner, may issue at their discretion without review by the 
 courts, what is termed a fraud order, and mail addressed to the 
 person under fire is returned to his correspondents so marked. 
 The individual is thus practically branded as a criminal without 
 any trial, and is caused to suffer perhaps heavy losses without 
 any means of defending himself. Many thousands of such fraud 
 orders have been issued and they are constantly being used. 
 No matter how urgent the business or how great the loss in- 
 volved, the delivery of mail depends on the official pleasure of 
 the post office department. They determine the character of 
 the mail which they will allow the rest of their fellow citizens 
 to receive. 
 
 They also have the power of refusing to transmit what they 
 deem obscene matter. This may include medical publications, 
 and in a recent instance, a sociological work on the subject of 
 white slavery prepared by a committee of public spirited citi- 
 zens, of whom John D. Rockefeller, Jr., was one, was so refused 
 transmission. 
 
 The officials of the department also decide the fates of pub- 
 lications. The securing of the second class rate is a necessity 
 to a publisher. It depends on the ruling of an official. 
 
 The post office department thus has to a great extent extra- 
 legal powers. And where such powers exist, it is invariably the 
 course of officials to seek to extend and enlarge tliem to the great- 
 est degree. A government however wisely constituted, comes in 
 time to be covered with growths of official usurpation, until the 
 whole fabric falls to pieces. The change from honest, patriotic 
 administration to one of official autocracj^ is gradual, but a sure 
 indication of national decay. While the officials of the post
 
 28 THE PRICE OF INEFFICIENCY 
 
 office department may be wise men, it is not within tlie wisdom 
 of any man to exercise justly such powers as they possess when 
 not subject to review. They occupy, however, a minor position 
 of culpability, compared with a public sentiment which permits 
 them to have such powers. Acquiescence in acts of official 
 usurpation distinguishes a subservient from a liberty loving 
 people. 
 
 A department thus, which possesses so much power, may be 
 depended upon to exercise it to the disadvantage of the public. 
 Bismarck when he recommended criticism of officials for the 
 sake of improvements, might well have recommended more criti- 
 cism as a preservative for the seiwice already being rendered. 
 
 The post office department has lately overreached itself in 
 an attempt to obtain, in an underhanded manner, legislation 
 which would have enabled it to make certain changes in postal 
 classifications, with the power of practically driving out of busi- 
 ness large numbers of magazines; a form of periodical which, 
 unlike newspapers, being without political obligations, have 
 prospered greatly by a fearless criticism of governmental and 
 other usurpations. 
 
 In the course of the criticisms brought out, it has been proved 
 that while showing a great deal of activity in managing other 
 people's business, the post office department has not taken the 
 beam out of its own eye. It has been found that the post office 
 cannot tell the cost of transporting the different classes of mail ; 
 that its system of keeping accounts is highly cumbersome and 
 old fashioned; that the method of paying transportation com- 
 panies for carrying the mails is such that the government pays 
 excessively for the service, and that numerous wasteful methods 
 of business are in vogue. 
 
 At the same time the service rendered in the dispatch and 
 delivery of the mails is far inferior to that of tlie principal 
 European countries. 
 
 Every year there is a postal deficit where under proper 
 methods there should be a large actual profit, besides an enor- 
 mous impetus to business. 
 
 It would appear to be more than a coincidence that the fraud 
 order law, which was passed largely at the instance of the 
 Chicago Board of Trade and certain eastern financial interests, 
 is chiefly directed at the suppression of financial undertakings 
 which come under question, and which compete directly for the 
 investors' money with the stock exchanges and boards of trades*
 
 ADMINISTRATIVE WASTE 29 
 
 investment offerings. It would thus appear that if any under- 
 taking desires capital, the course of wisdom would not be to 
 tempt the post office department and its investigations, but to 
 arrange for the flotation of the stock through some established 
 brokerage channel. Thus the laws of a country may be made 
 to work together for the good of those who love the lobby. 
 
 Even in minor matters, the post office department is able to 
 exercise a remarkable intelligence. For example, if a special 
 delivery letter is sent and the addressee is not found, the letter 
 is carried back to the post office to be later delivered with the 
 regular mail, instead of being left at the address when first 
 taken there. In many cases the object of the sender is thus 
 defeated. The utter stupidity of taking a letter to an address 
 and then taking it away again can only be equaled by official 
 regulations. Registered letters require excessively long addi- 
 tional time in transmission. The cashing of a money order is 
 a process compared to which the opening of an account in a 
 bank is a simple incident. And if a letter is refused by an 
 addressee because of lack of postage, it goes to Washington in- 
 stead of back to the sender. All these are examples of bad 
 business methods which affect every user of the mails and create 
 a vast amount of unnecessary inconvenience. 
 
 And it is cheaper, for instance, to send a package of a certain 
 class the 6,000 miles from San Francisco to Germany than the 
 6 miles from Manhattan to Brooklyn. 
 
 What then is the matter with the post office department? 
 
 The answer is, inefficient business management. In no other 
 department are the results of incompetency so pronounced. 
 The distribution of pensions, though done in a cumbersome and 
 costly manner, is still merely a governmental function in which 
 incompetency, as in many other departments, escapes notice. 
 But in the post office which is a business affecting other busi- 
 nesses, and in which comparisons can be made directly with 
 other transporting organizations, the incompetency of its admin- 
 istration is at once in painful and profuse evidence. 
 
 And at the bottom of it again comes the question of politics. 
 The business of transporting and delivering the mails is one 
 that should receive the attention of men of long experienqe and 
 training, but with each political change, a vast change is made 
 in the post office. Postmasters all over the country are changed 
 at wholesale, and inroads are made wherever possible in the 
 civil service. The post office is the seat of the greatest federal
 
 30 THE PRICE OF INEFFICIENCY 
 
 patronage. The carrjdng of the mails is thus made an inci- 
 dent of politics and the prompt and efficient service which is 
 liberally paid for and which would be a great boon to business 
 and a vast convenience to everyone, is sacrificed to reward a 
 horde of insignificant political workers with positions, in which 
 the most noticeable thing they do is to display their incompe- 
 tency. 
 
 The mismanagement and waste in the post office and in pen- 
 sions have their counterparts, perhaps less pronounced, in prac- 
 tically every department of the government. The great honey- 
 comb of politics in business and business in politics, runs 
 through and through the government, with every incentive for 
 its continued growth and nothing but sporadic, misdirected and 
 ineffective flashes of the peculiar flash-in-the-pan American pub- 
 lic sentiment, which burns hotly one day and is forgotten the 
 next, to oppose it. 
 
 In contrast to the waste and inefficiency of our governmental 
 system, is a recent movement made by Germany in the appoint- 
 ment of technological advisers to her ambassadors and ministers 
 in foreign countries. This move is described in the United 
 States Daily Consular & Trade Reports for Sept. 2, 1911 : 
 
 "The assignment of commercial experts to various important 
 German consulates has been found so advantageous in promot- 
 ing German exports that it is now proposed to supplement them 
 with special experts for answering technical questions. 
 
 "In many cases the commercial experts are not in the position 
 to represent Germany industiy so far as it relates to questions 
 of a purely technical nature, and they do not possess the neces- 
 sary professional knowledge to answer the detailed, exhaustive 
 and at times right specific questions addressed to them. This 
 task will be given to the technical advisers to be appointed. 
 Their field of activity will lie in following the progress of the 
 industrial development of a foreign country and reporting 
 about all technical novelties." 
 
 "This," says the New York Tribune, "is characteristic of 
 Germany, and of the superlative paternalism of her government. 
 In no other land does the government pay so much attention to 
 industrial and commercial education and to technical training 
 in the arts and sciences. There is not a trade or department of 
 industry of commerce for which the German government does 
 not provide the most thorough training. There can be no doubt 
 that to this circumstance are due in large measure the marvel-
 
 ADMINISTRATIVE WASTE 31 
 
 ous mdiistrial and commercial growth of that country and its 
 j:)ower to outstrip rivals which do not resort to such means of 
 developing their efficiency. Now, having provided for domestic 
 instruction, she proposes to learn all that there is to be learned 
 abroad, discreetly beginning in those two countries which she 
 recognizes to be her most formidable rivals and in which, be- 
 cause of their great efficiency and progress, there is presumably 
 most to be learned. 
 
 "The new step is perfectly logical, in a double respect. It is 
 as logical thus to seek national instruction abroad as it is to 
 provide national instruction at home. If a government main- 
 tains industrial schools at home, it may properly send official 
 students abroad. If, moreover, it sends diplomatic agents to 
 observe the arts of war, it may fittingly send them to observe 
 the arts of peace. It has long been the custom to appoint mili- 
 tary and naval attaches to embassies. This new action of Ger- 
 many's will be placing economics on the same plane of official 
 recognition and cultivation as militarism. If it is quite natural 
 that it should be taken by the government which has been pay- 
 ing most attention to industrial and commercial education, it is 
 a significant circumstance that this noteworthy recognition of 
 the arts of peace should be first given by that government which 
 is supposed to be most of all devoted to and absorbed in the arts 
 of war," 
 
 This supposition, it may be said in passing, is quite un- 
 founded in fact, as a comparison of costs of armaments shows 
 that the annual burden per capita is in Germany $5.30 as against 
 $8.00 in Great Britain, $6.75 in France and $3.10 in the United 
 States.
 
 CHAPTER IV 
 WHAT IS CONSERVATION? 
 
 What conservation really means — Nature's reckoning — The forests of 
 America — They cover one acre in four — The cost of locomotive sparks 
 
 50,000,000 acres of forest fires every year — How two-thirds of the 
 
 timber that leaves the forest is wasted — Methods of modern forestry 
 • — The army as a forest patrol — Success of rain-making cannons in 
 Switzerland — Legislation that destroys forests — Decreasing mineral 
 resources — When the last lump of coal is mined — Petroleum passing 
 into history — The crime of pliosphate rock exports — Chemistry, the 
 science economical — The gilded romance of by-products — Untouched 
 millions in American peat — The extravagance of the farmer — How his 
 land goes to sea — How his opportunities take wings — How he might 
 double his crops instead of his mortgages — An endless chain of dis- 
 asters — Our unharnessed water power — Only one fiftieth of it utilized — 
 A waste equal to 225,000,000 tons of coal a year — Undrained lowlands 
 — Homes for 10,000,000 under water that might be reclaimed. 
 
 Conservation, that dignified and easy-going old word, pursu- 
 ing its pompous enough course through the vocabulary, must be 
 rather astonished at the prominence that has been thrust upon 
 it within the last few years. It is as though some respected 
 old mutton-chops had suddenly been snatched from his small 
 orbit of business and recreation, and placed at the head of 
 Coxey's aniiy. Conservation can hardly know itself in its new 
 surroundings and prominence. 
 
 It is doubtful if many others know it, either. It does for a 
 battle cry, a slogan of remonstrance, but what conservation 
 really means, the complicated clash of interests back of it, and 
 what it should mean, is as yet an unopened book to the Ameri- 
 can public. 
 
 To the average citizen, conservation means something about 
 forests several thousand miles away. What conservation should 
 mean is the proper use of the resources of the country, with 
 a due proportion for to-day and enough for to-morrow's use left 
 for posterity. 
 
 No country is so wasteful of its natural resources as America, 
 
 nor so extravagant of human life and property. The vast losses 
 
 32
 
 WHAT IS CONSERVATION? 33 
 
 through carelessness and neglect of proper precautions make a 
 terrible annual total. The government might be left to waste 
 as it will, if the waste of carelessness could be overcome. 
 
 Yes, administrative inefficiency is largely to blame for the 
 wastes of carelessness, since with proper utilization of the facili- 
 ties which the government has at hand, and a little additional 
 expenditure of money and common sense, great savings could 
 be effected. 
 
 According to reports of the Department of Agriculture, 
 
 ' ' Our industries which subsist wholly or mainly on wood, pay 
 the wages of more than 1,500,000 men and women. 
 
 "Forests not only grow timber, but they hold the soil and 
 conserve the streams. They abate the wind and give protection 
 from excessive heat and cold. Woodlands make for the fiber, 
 health and happiness of the citizens and the nation. 
 
 "Our forests now cover 550,000,000 acres or about one-fourth 
 of the United States. The original forests covered not less than 
 850,000,000 acres. 
 
 "We have 200,000,000 acres of mature forests, in which yearly 
 growth is balanced by decay; 250,000,000 acres partly cut over 
 or burned over, but restocking naturally with enough young 
 growth to produce a merchantable crop, and 100,000,000 acres 
 cut over and burned over, upon which young growth is lacking 
 or too scanty to make merchantable timber. 
 
 "We take from the forests yearly, including waste in log- 
 ging and in manufacture, 23,000,000 cubic feet of wood. 
 
 "Since 1870 forest fires have destroyed an average of 50 
 lives and $50,000,000 worth of timber. Not less than 50,000,000 
 acres of forests is burned over yearly. The young growth de- 
 stroyed by fire is far more valuable than the merchantable tim- 
 ber burned. 
 
 "One-fourth of the standing timber is lost in logging. The 
 boxing of long pine leaf for turpentine has destroyed one-fifth 
 of the forests worked. The loss in the mill is from one to two- 
 thirds of the timber sawed. The loss of the mill product in 
 seasoning and fitting for use is from one-seventh to one-fourth. 
 
 "Of each 1,000 feet which stood in the forest, an average of 
 only 320 feet of lumber is used. 
 
 "We take from our forests each year, not counting tlie loss 
 by fire, three and one-half times their yearly growth. We take 
 40 feet per cubic acre for every 12 feet grown ; we take 260 feet 
 per capita, while Germany uses 37 and France 25 cubic feet.
 
 34 THE PRICE OF INEFFICIENCY 
 
 "We tax our forests under the general property tax, a 
 method abandoned long ago by every other great nation. Pres- 
 ent tax laws prevent reforestation of cut-over land and the per- 
 petuation of existing forests by use. 
 
 "Great damage is done to standing timber by injurious forest 
 insects. Much of this damage can be prevented at small cost. 
 
 "To protect our farms from wind and to reforest land best 
 suited for forest growth will require tree planting on a larger 
 area than Pennsylvania, Ohio and West Virginia combined. 
 Lands so far successfully planted make a total area smaller than 
 Rhode Island; and year by year, through careless cutting and 
 fires, we lower the capacity of existing forests to reproduce their 
 like again, or else we totally destroy them. 
 
 "In spite of substitutes, we shall always need much wood. 
 So far our use of it has steadily increased. The condition of the 
 world's supply of timber makes us already dependent upon 
 what we produce. We send out of our country one and a half 
 times as much timber as we bring in. Except for finishing 
 woods, relatively small in amount, we must grow our own sup- 
 ply or go without. Until we pay for our lumber what it costs 
 to grow it, as well as what it costs to log and saw, the price 
 must continue to rise." 
 
 In certain years, the losses from forest fires amount to $200,- 
 000,000 in the standing timber alone, besides the other losses 
 involved. 
 
 One of the greatest causes of forest fires is locomotive sparks. 
 This is easily preventable, by requiring locomotives passing 
 through forests to burn oil instead of coal. Until railroads 
 are able to save a few dollars in fuel expenses by the adoption 
 of oil burning locomotives, the forest fires will have to con- 
 tinue. 
 
 Proper forestation will save a large part of the loss at a very 
 small expense. The most approved plan is to divide the forest 
 into sections by cutting through longitudinal and laternal cross 
 avenues of suitable width, from which the timber and under- 
 brush is removed. Thus a fire in one section, in most cases dies 
 out on reaching an avenue. 
 
 A suitable patrol with telephonic communication should be 
 provided and in some sections under governmental supervision 
 this is being done. It is a system which should be applied to 
 all forests. 
 
 Although somewhat beneath the dignity of the regular army
 
 WHAT IS CONSERVATION? 35 
 
 in the United States, the fighting of forest fires is a field in 
 which the army can be made of the greatest usefulness. 
 
 In Germany both officers and men equipped with picks, shovels 
 and axes, are rushed to forest fires in quick order, running and 
 walking in alternate stretches of four minutes until the locality 
 is reached, when new avenues are cut, ditches dug and fires 
 beaten out in the underbrush. Spectators, also are pressed into 
 service, and the spectator who does not lend a hand when or- 
 dered to do so, is promptly arrested. 
 
 In the United States, the calling out of the militia has not as 
 yet been done to fight forest fires, but it will certainly come 
 about. The regular army is ordered to the scenes of great con- 
 flagrations in cities, and the militia as well. Their presence at 
 forest fires is just as necessary and desirable, and will mean sav- 
 ings of magnitude great enough to make the army a source of 
 profit rather than a burden. In the Northwest the use of the 
 regulars in fighting fires has already been begun. 
 
 Germany's use of her army in forest fire prevention and 
 fighting probably more than pays the whole bill. 
 
 Fire fighters in the forest, however, need some training and 
 drill. During a fire in the Northwest in 1910, having no re- 
 sources to fall back on, Congress was asked to appropriate 
 $100,000 to purchase powder to be used in discharging cannons 
 to make rain. The money was not forthcoming, however, and 
 even if it had been, it would have been largely wasted, since 
 they had no cannons especially adapted for the precipitation of 
 rainfall. 
 
 In Switzerland, great skill is exercised in this direction, can- 
 nons of special design being used, which when discharged at 
 a cloud, will produce a disturbance of air over a large area and 
 cause the desired rainfall. When there is no cloud, however, 
 no rain can be produced, and the ordinary cannon is of little or 
 no use. The Swiss gunner is so skillful in the use of the rain- 
 making cannons that he can direct a shower over a particular 
 field, and thus prevent it falling in another where it would be 
 wasted. 
 
 A little study of forest fire prevention, and fewer sham battles 
 would be very desirable for the militia, as well as for the regu- 
 lars, and the boards of strategy at Washington planning imag- 
 inary campaigns which can never take place might profitably 
 devote some time to forest fire tactics. 
 
 We see the spectacle of railroads and mining companies plant-
 
 36 THE PRICE OF INEFFICIENCY 
 
 ing forests for supplying ties and timbering, when at the same 
 time the precautions taken to preserve the forests already stand- 
 ing are so totally inadequate. This is conservation at the spigot 
 and waste at the bunghole. 
 
 For each 1,000,000 acres of forest in public ownership, over 
 4,000,000 are privately owned. The duty of the government 
 towards its own forests would be more faithfully performed by 
 the repeal of the present timber and stone act, in force for the 
 last thirty years. Under it, timber worth $300,000,000 has been 
 sold for about $30,000,000 and an annual yearly loss of $25,- 
 000,000 of the actual value of the timber is being incurred. 
 
 Another example of destructive legislation is in the laws tax- 
 ing forest land. Their effect is to prevent reforestation. "What 
 this amounts to is shown in the figures of re-growth of 12 cubic 
 feet per acre, while in Germany the forests yield 48 feet an- 
 nually per acre. 
 
 The waste of timber in careless cutting and handling can be 
 greatly reduced. We now use but 320 cubic feet of lumber for 
 every 1000 feet which stood in the forest. 
 
 Our extravagance of forests is shown by the fact that not 
 counting the loss by fire, we take three and one-half times their 
 yearly growth or 40 cubic feet per annum from our forests, 
 which amounts to 260 cubic feet per capita, while Germany 
 uses but 37 and France but 25 cubic feet per capita. In wast- 
 ing our forests thus we are only increasing our fire bills for con- 
 flagrations, for the fire loss abroad is only one-tenth of our own 
 loss per capita. 
 
 The waste in forests, while enormous, has in addition a cer- 
 tain sentimental interest, which attracts comparatively more 
 attention to the subject than is given to waste of a more serious 
 nature in other fields. 
 
 The tree in the forest is a living thing, with a certain individ- 
 uality, and its wanton destruction excites the imagination, while 
 the lump of ore out of the earth has no such appeal. Yet the 
 annual waste in the treatment of the ore is five or six times that 
 of forest fires. 
 
 According to the report of the National Conservation Com- 
 mission, the mincr-al [)roduction of the United States for 1907 
 exceeded $2,000,000,000 and contributed 65% of the total 
 freight traffic of the country. The waste in the extraction and 
 treatment of mineral products during the same year was equiva- 
 lent to more than $300,000,000. The report states :
 
 •WHAT IS CONSERVATION? 37 
 
 "The production for 1907 included 395,000,000 tons of bitu- 
 minous and 85,000,000 tons of anthracite coal ; 166,000,000 bar- 
 rels of petroleum; 52,000,000 tons of iron ore; 2,500,000 tons 
 of phosphate rock and 869,000,000 pounds of copper. The 
 values of other mineral products during the same year included 
 clay products, $162,000,000; stone, $71,000,000; cement, $56,- 
 000,000; natural gas, $53,000,000; gold, $90,000,000; silver, 
 $37,000,000; lead, $39,000,000; and zinc, $26,000,000. 
 
 ''The available and easily accessible supplies of coal in the 
 United States aggregate approximately 1,400,000,000 tons. At 
 the present increasing rate of consumption, this supply will be 
 so depleted as to approach exhaustion before the middle of the 
 next century. 
 
 "The kno^\^l supply of high grade iron ores in the United 
 States approximates 4,788,150,000 tons, which at the present 
 increasing rate of consumption, cannot be expected to last be- 
 yond the middle of the present century. In addition to this, 
 there are assumed to be 75,116,070,000 tons of lower grade iron 
 ores which are not available for use under existing conditions. ^ 
 "The supply of stone, clay, cement, lime, sand and salt is 
 ample, while the stock of the precious metals and of copper, 
 lead, sulphur, asphalt, graphite, quicksilver, mica and the rare 
 metals cannot be well estimated. But it is clearly exhaustible 
 within one or two centuries unless unexpected deposits be found. 
 "The known supply of petroleum is estimated at 15,000,000,- 
 000 to 20,000,000,000 barrels, distributed through six separate 
 fields, having an aggregate area of 8,900 square miles. The pro- 
 duction is rapidly increasing, while the waste and losses through 
 misuse are enormous. The supply cannot be expected to last 
 beyond the middle of the present century. 
 
 "The kno-vvn natural gas fields aggregate an area of 9,000 
 square miles distributed through 22 states. Of the total yield, 
 from these fields during 1907, 400,000,000,000 cubic feet, valued 
 at $62,000,000,000 were utilized while an equal quantity was 
 allowed to escape into the air. The daily waste of natural gas, 
 the most perfect known fuel, is over 1,000,000,000 cubic feet, or 
 enough to supply every city in the United States of over 100,000 
 population. 
 
 "Phosphate rock, used for fertilizer, represents the slow ac- 
 cumulation of organized matter during the past ages. In most 
 countries it is scrupulously preserved; in this country it is ex- 
 tensively exported, and largely for the reason that its produc-
 
 38 THE PRICE OF INEFFICIENCY 
 
 tion is increasing rapidly. The original supply cannot long 
 withstand the increasing demand." 
 
 The greater part of the enormous losses in the handling of 
 minerals is due to failure to utilize the proper chemical pro- 
 cesses known to the arts. 
 
 The report of the Twelfth Census discloses startling condi- 
 tions and indicates what proper utilization of the chemical dis- 
 coveries now known would mean : 
 
 "Probably no science has done so much as chemistry in re- 
 vealing the hidden possibilities of the wastes and by-products 
 in manufactures. This science has been the most fruitful agent 
 in the conservation of the refuse of manufacturing operations 
 into products of industrial value. Chemistry is the intelligence 
 department of industry. 
 
 "The measure of a country's appreciation of the value of 
 chemistry in its industrial development and the extent to which 
 it utilizes this science in its industries, generally measure quite 
 accurately to the industrial progress and prosperity of that 
 country. In no other country in the world has the value of 
 chemistry to industry been so thoroughly understood and appre- 
 ciated as in Germany. And in no other country of similar size 
 and endowment have such remarkable advances in industrial 
 development been recorded; this, too, with steadily increasing 
 economy in the utilization of natural resources. 
 
 "In ioOT over 40,000,000 tons of coke, valued at nearly $112,- 
 000,000, were produced from about 62,000,000 tons of coal. 
 Only 5,500,000 tons of this, or about less than 14%, was ob- 
 tained in by-product ovens. About 54,500,000 tons of coal 
 were coked in bee-hive ovens. This involved a waste of 148,- 
 000,000,000 cubic feet of gas, worth $22,000,000; 540,000 tons 
 of ammonium sulphate, worth a similar amount, and nearly 
 400,000,000 gallons of tar, worth $9,000,000. 
 
 "We are therefore wasting enough power to establish a great 
 manufacturing center, enough ammonium sulphate to fertilize 
 thousands of acres, enough creosote to preserve our lumber, and 
 enough pitch and tar to roof our houses and briquette our slag 
 and waste coal. Lignites have been found not only to give ex- 
 cellent yield of gas, but also tar, oils, paraffin and other valuable 
 by-products. It has recently been claimed that one ton of dried 
 peat can be made to yield 162 liters of pure alcohol and about 
 66 pounds of pure ammonium sulphate. 
 
 "In 1907, 4,000,000 tons of coal were consumed in the pro-
 
 WHAT IS CONSERVATION? 39 
 
 duction of 34,000,000,000 cubic feet of coal gas for heating and 
 illuminating, worth $36,000,000, in addition to over 100,000,- 
 000,000 cubic feet of water and oil gas, worth $90,000,000 ; of all 
 told worth $126,000,000. 
 
 ' ' No accurate estimate can be made as to the total unnecessary 
 losses in connection with the use of coal for different purposes, 
 but lines of urgently needed investigation are indicated by the 
 facts that the vast majority of power plants of the country con- 
 vert less than 10% of the heat units in the coal into actual 
 work, and that lighting plants convert less than 1% of 
 the heat value of the coal into electric light. The large amount 
 of gases from blast furnaces are being used to a small but an 
 increasing extent in the development of gas-engine power. In 
 the coking industry, including other by-products, the waste 
 totals $55,000,000 a year. 
 
 "The first step in extending our fuel supply should be to 
 lessen the waste in mining, handling, and transportation of coal. 
 There are equally possible great savings in the use of coal, not 
 only in the prevention of waste now" recognized as such, but also 
 in discovering means of avoiding the losses involved in the 
 transportation of heat into mechanical energy, and this into 
 electric energy and light. 
 
 "Water power will doubtless prove a valuable substitute for 
 coal in the development of power and light in many parts of the 
 country, and the use of the heat of the sun and of alcohol and 
 other organic fuels as substitutes for coal is worthy of serious 
 consideration and investigations. 
 
 "In European countries where fuel is expensive, 10,000,000 
 tons of peat are used annually for fuel purposes. A prelimi- 
 nary and incomplete examination of the peat beds of the country 
 has developed the fact that they extend over an area of 11,000 
 square miles, the larger part of which is distributed through 
 the New England states. New York, Minnesota, Wisconsin, New 
 Jersey, Virginia, the Carolinas and Florida, — states wiiich con- 
 tain little or no coal. Extensive deposits are also found in a 
 few coal producing states — Iowa, Illinois, Indiana, Ohio, North 
 Dakota and South Dakota. 
 
 "This area indicates a possible production of 13,000 millions 
 of tons of air dried peat fuel. At $3 per ton in the air dried 
 form (which would be a reasonable price for fuel in the states 
 having but little coal) this peat would have a fuel value of $39,- 
 000,000,000. If all of it were used in by-product gas producers,
 
 40 THE PRICE OF INEFFICIENCY 
 
 640,000,000 tons of ammonium sulphate could be manufactured 
 as a by-product, and at current prices this would be worth an 
 aggregate value of more than $36,000,000,000. 
 
 "Recent investigations have shown that much American peat 
 when dried will be admirably adapted for use as a source of 
 producer gas for charcoal, for certain grades of coke, for the 
 production of various by-products, for illuminating gas, as a 
 filler for fertilizers, in the manufacture of paper, and for pack- 
 ing material." 
 
 The vast losses which may thus be determined in forests, min- 
 erals and coal, have a counterpart in the loss to the country 
 through inefficient agricultural methods. 
 
 The American farmer allows his land to go to waste, through 
 erosion, he squanders his timber and impoverishes the fertility 
 of his soil, and poverty staring him in the face, he takes refuge 
 in the cities, or the Canadian northwest, when by proper 
 methods, his land would be yielding him double its present crops 
 with no greater labor than he spends now. 
 
 After the factory worker, no individual receives the sympathy 
 accorded the mortgage burdened farmer, but the truth is that 
 while he is a hardworking fellow he is a fool. A little more use 
 of his head instead of his hands would save his hands and the 
 prosperity of the country as well. The factory worker has the 
 ignorant excuse that added work on his part would principally 
 benefit his employer, but the farmer being his own employer has 
 not even that excuse to offer, for every stroke he does is for his 
 own benefit. 
 
 The average yield of wheat in the United States is less than 
 14 bushels per acre, in Germany it is 28 bushels and in England 
 32 bushels. We get 30 bushels of oats per acre, England nearly 
 45 and Germany more than 47. Our soils are fertile but our 
 modes of farming neither conserve the soil nor secure full crop 
 returns. Soil fertility need not be diminished, but may be in- 
 creased. The large yields now obtained from farms in Europe, 
 which have been cultivated for a thousand years, prove this con- 
 clusively. Proper management will double our average yield 
 per acre. The United States can grow the farm products 
 needed by a population more than three times as great as our 
 country now contains, provided the waste land is utilized. The 
 area of land for cultivation may almost be doubled. 
 
 In addition to land awaiting the plow, 75,000,000 acres of 
 swamp land can be reclaimed, 40,000,000 acres of desert land
 
 WHAT IS CONSERVATION? 41 
 
 irrigated, and millions of acres of brush and wooded land 
 cleared. Our population will increase continuously, but as there 
 is a definite limit to the increase of our cultivated acreage, we 
 must greatly increase the yield per acre. The American farmer, 
 more than anyone, must give ear to the call for efficiency. 
 
 The greatest unnecessary loss of our soil is preventable 
 erosion. Second only to this is the waste, non-use and misuse 
 of fertilizer derived from animals and men. 
 
 The losses to farm products due to injurious mammals is 
 estimated at $130,000,000 annually; the loss through plant dis- 
 eases reaches several hundred million dollars; and the loss 
 through insects is reckoned at $659,000,000. The damage by 
 birds is balanced by their beneficent work in destroying noxious 
 insects. Losses due to the elements are large, but no estimate 
 has been made of them. 
 
 Losses to live stock from these causes are diminishing because 
 of protection and feeding during the winter. The annual losses 
 from disease among the domestic animals are: horses 1.8%, 
 cattle 2%, sheep 2.2% and swine 5.1%. Most of these farm 
 losses are preventable. 
 
 A noticeable chain of losses is seen in considering the subject 
 of conservation. The waste of forests is largely the cause of 
 floods and freshets and soil erosion, the latter producing one of 
 the great wastes of argiculture. 
 
 The wastes of forests and the selling of wood at the cost of 
 getting it to market instead of the added price of its replace- 
 ment, causes frame houses to be built in great numbers, and the 
 fire loss on this account with the added cost of fire departments 
 and water supplies in cities over the normal requirements is 
 another link in the costly chain of inefficiency. 
 
 The floods, which would not be so considerable were the 
 forests properly conserved, involve great losses and make more 
 difficult the utilization of water powers, since the water comes 
 at a single short season instead of being more generally distrib- 
 uted. 
 
 The forest tree is one of the best friends of mankind; and 
 it deserves mankind's most grateful treatment. 
 
 The waste of our water powers is little understood. It may 
 best be indicated by a quotation for the author 's work, ' ' Hydro- 
 electric Developments & Engineering." 
 
 "Nearly every state in the Union has large water powers 
 available. It has been estimated that the upper Mississippi and
 
 42 THE PRICE OF INEFFICIENCY 
 
 its tributaries have an available water power of about 2,000,000 
 horse power; that of the Southern Appalachin region, about 
 3,000,000 and that of the state of Washington alone, about 
 3,000,000 horse power. 
 
 "According to estimates made by the United States Geological 
 Survey, there is a minimum of about 2,800,000 horsepower 
 developed by the rivers in the Southern Appalachin Mountains. 
 Mature consideration of the conditions leads to the estimate that 
 at least 50% and probably much more of this indicated horse- 
 power is available for economic development. If auxiliary 
 power were provided, it would be profitable to develop up to 
 2.5 times this amount. 
 
 "Full development of storage facilities would increase the 
 minimum from twenty to thirty times. Obviously an estimate of 
 present value based on 50% of the minimum horsepower is sure 
 to be extremely conservative. The rental of 1,400,000 horse- 
 power at $20 per horsepower per year, would amount to an 
 annual return of $28,000,000. This amount is equal to a gross 
 income of 3% on a capital of about $933,000,000. Some of thia 
 power has already been developed, but a very small proportion 
 — hardly enough to make any appreciable showing when the 
 enormous resources of the region are taken into account. 
 
 "It has been estimated that in the United States more than 
 30,000,000 horsepower are available, and under certain assump- 
 tions as to storage reservoirs, this amount can be increased to 
 150,000,000 horsepower or possibly more. 
 
 "Using the smaller figure of 30,000,000 horsepower as an 
 illustration ; to develop an equal amount of energy in our most 
 modern steam electric plants would require the burning of 
 nearly 225,000,000 tons of coal per annum, and in the average 
 steam engine plant, as now existing, more than 600,000,000 tons 
 of coal, or 50% in excess of the total coal production of the 
 country in 1906. At the average price of $3 per ton, it would 
 require the consumption of coal costing $1,800,000,000 to pro- 
 duce an equivalent power in steam plants of the present general 
 type. 
 
 "Of this immense power available, only a small percentage is 
 developed, estimated to be about 3,000,000 horsepower." 
 
 The practical utility of streams for both navigation and 
 power is measured by the effective low water stage. The vol- 
 ume carried when the streams rise above this stage is largely 
 wasted and often does serious damage. The direct yearly dam-
 
 WHAT IS CONSERVATION? 43 
 
 age by floods since 1900 has increased steadily from $45,000,000 
 to over $238,000,000. The indirect loss through depreciation 
 of property is great while a large loss rises in impeded traffic 
 through navigation and terminal transfers. 
 
 The freshets are attended by destructive soil erosion. The 
 soil matter annually carried into lower rivers and harbors or 
 into the sea is computed at 783,000,000 tons. Soil wash reduces 
 by 10 or 20 per cent, the productivity of upland farms and in- 
 creases channel cutting and bar building in the rivers. The 
 annual loss to the farmers alone is fully $500,000,000 and large 
 losses follow the fouling of the waters and the diminished navi- 
 gability of the streams. 
 
 Through imperfect control of the running waters, lowlands 
 are temporarily or permanently flooded. It is estimated that 
 there are in the mainland of the United States about 75,000,000 
 acres of overflow and swamp lands requiring drainage; that by 
 systematic operation these can be drained at moderate cost, and 
 that then they would be worth two or three times the present 
 value and cost of drainage, and would furnish homes for 10,- 
 000,000 people.
 
 CHAPTER y 
 CONSERVATION OF HIBIAN LIFE 
 
 Xational criminal negligence — Division of responsibility and its terrible 
 consequences — The death toll of transportation — The evil genius of the 
 Xew York transportation interests — The demands of industry — 8,531 
 killed and 102,075 injured — The frightful tragedies of the coal mines — 
 The blight of white lead — Governmental inefficiency chargeable with, 
 the greater part of the loss — The white plague — ^Undermining the health 
 of the worker — The death chambers of the poor — Factory sanitation — 
 The proper protection of the worker is the duty of the state — The 
 factory, the symbol of modern progress. 
 
 Inefficiency, in addition to its direct losses, is chargeable 
 ^^"itll a vast account of poverty, misery and WTong. Criminal 
 negligence is punishable by law, but the line between negligence 
 and inefficiency, as little as the two may at first glance seem 
 connected, is a narrow one, and the inefficiency of to-day has 
 terrible results in the work of to-morrow. 
 
 Division of responsibility is the mother of inefficiency, and 
 any degree of efficiency is likely to continue in force if the 
 responsible man cannot be definitely located. 
 
 If this were not the case, there would be an instant reduction 
 in the wholesale slaughter of human beings by the railroads and 
 in the industries, and the vast amount of preventable injuries, 
 poisoning and disease which levy their hourly toll all over the 
 country. 
 
 In the daily battle of transporting itself about the city of New 
 York, the population of the city is reduced by 350 killed and 
 2,700 injured every year. That is, of those who start out to 
 ride on any given day, one will never return and seven will be 
 brought back injured, the price of inefficient transportation. 
 
 The cost to the transportation companies amounts to about 
 $2,500,000 in damages and $1,000,000 in legal expenses, while 
 to the public the cost is vastly greater, since of the damages 
 they receive, at least half is consumed in legal expenses, while 
 the amount recovered amounts, in no case, to a very large pro- 
 portion of the actual loss. 
 
 44
 
 CONSERVATION OF HUIMAN LIFE 45 
 
 The inefficiency in preventing accidents and the inefficiency 
 of the method of adjusting damages thus fastens itself on the 
 public in the shape of heavy loss of life and limb ; a loss which 
 on the part of the companies amounts to 9% of their 
 running expenses. The maintenance of a vaste horde of law- 
 yers, who otherwise would be engaged in useful occupations, is 
 another great drain. In Germany, there is only the recovery 
 of pensions and seldom a lump sum, and the fees of the lawyers 
 are properly regulated, so that there is not the tremendous 
 prize offered to the encouragement of litigation which is hung 
 up almost without exception by the American sj'stem of lump 
 sum damages. 
 
 The historj' of the street railways of New York is one of the 
 blackest chapters that was ever written in the pages of civic 
 development. It is from the beginning a story of criminal 
 bribery for franchises, stock market manipulation and stripping 
 of investors, robbery of the companies by their officers through 
 false bookkeeping, treacherous struggles between companies, 
 outrageous treatment of passengers in transit and in ease of 
 damage suits, long delays, perjurj^ intimidation of witnesses 
 and every form of trick and deceit that may be devised. Law- 
 yers, even, who have honestly won cases, have had their witnesses 
 bought over later and have been disbarred on charges of cor- 
 ruption of which they were never guilty. The e\'il genius which 
 presides over the transportation interests of New York has had 
 few parallels in any industry, and conditions to-day are aU that 
 might be expected of such a histon,^ 
 
 The political activity of the rival financial interests in the 
 New York transportation field, the desperate expedients of 
 the two parties and the network of undergi-ound interests, make 
 the subject, though veiled, one of the most menacing in Ameri- 
 can life to-day. Its ramifications are wide-spread and danger- 
 ous and it is like a cancer, attacking the political vitality of the 
 state, for neither party escapes its influence and the voters have 
 no means of expressing themselves on the subject, for however 
 they vote, the taint will be found in the councils of the victors. 
 This three cornered struggle between rival groups of capital and 
 decent government is an outrage on the public and were our 
 political system such that it could effectively reach the situa- 
 tion, unmistakeable retribution would follow. 
 
 America, however, is cursed with an antiquated and theoreti- 
 cal political sj'stem whereby no question can ever be decided on
 
 46 THE PEICE OF INEFFICIENCY 
 
 its own merits, as it can be in European governments through 
 changes in ministries, and the public is thus left in helpless con- 
 fusion, while unspeakable conditions continue. At every elec- 
 tion, by devices of politicians, no matter what issue a party 
 may be committed to, it always stands for other issues, and the 
 total result is that the elected party does not know whether it 
 was elected on one issue or another, and thus is free to proceed 
 as interest and not as public welfare may dictate. 
 
 The situation in New York is duplicated in more or less mag- 
 nitude all over the country, both in a political sense and in the 
 inefficiency of operation. 
 
 Due to carelessness of employees, faulty methods of operation, 
 poor equipment, disregard of proper safety appliances, careless- 
 ness of the public itself, negligence from beginning to end of 
 all concerned and the final negligence of the public to place 
 responsibility; the harvest of death, disaster and misery, the 
 burdens of sickness and the suiferings of those bereft and in- 
 jured continue. 
 
 In railroad transportation the situation is even more appalling. 
 In 1910, 8,531 were killed and 102.075 injured, a total ranking 
 with the great battles of history. 
 
 An important addition to the casualties is the great number 
 killed while trespassing on railroads, which has amounted to 
 50,000 killed and 55,000 injured in the past eleven years. This 
 includes not only tramps, but laborers, and their wives and chil- 
 dren and others who use the tracks as thoroughfares in violation 
 of the rights of the roads, a practice but little censured by the 
 law. A more rigid enforcement of statutes on the subject, not 
 so much in severity of punishment as in certainty of punish- 
 ment, is highly desirable. 
 
 In mining, an exceptionally hazardous occuption, the losses 
 have been as follows : 
 
 For the 20 year period ending 1908, an aggregate of 9,422,902 
 persons employed in coal mining were exposed to risk of death, 
 an annual average of 471,145. Among this number there oc- 
 curred, as far as officially reported, 29,293 fatal accidents or an 
 average of 1,465 per annum, resulting in a death rate of 3.11 
 per 1,000. If the decade ending with 1906 is separately con- 
 sidered, it appears that the average fatality rate was 3.13 per 
 1,000, which compares with the corresponding rates for the 
 principal coal mining countries of the world most unfavor- 
 ablv.
 
 CONSERVATION OF HU]MAN LIFE 47 
 
 Comparison of Fatal-Accident Rates in Coal Mining Coxmtries for the 
 Period 1897 to 1906, 
 
 Total number Fatal Accidents 
 of employees Eate per 
 CouxTBY at work one Xumber 1000 em- 
 year ployees 
 
 North America 5,179,343 16,273 3.13 
 
 Japan ( 1902-1906) 438,259 l!355 3.09 
 
 Russia, Finland (1901-1903) 330,147 805 2.44 
 
 Victoria 7,902 18 2.28 
 
 New South Wales 124,940 267 2.14 
 
 Prussia 4,389,174 9,327 2.13 
 
 France 1,629,177 2,944 1.81 
 
 Xew Zealand 27,268 37 1.36 
 
 Austria 1,186.510 1,599 1.35 
 
 United Kingdom 7,973,031 10,319 1.29 
 
 Queensland 11,714 14 1.20 
 
 Belgium 1,322.516 1.401 1.06 
 
 India (1808-1906) 790,070 676 86 
 
 It Tvill be seen from this comparison that the risk of fatal 
 accident in the coal mines of North America is decidedly more 
 serious than in any part of any other coal field in the world. 
 Considering the constant growth of the mining industry, on this 
 continent, an increase measured by an enhanced output in the 
 United States alone from 253,741.192 tons in 1899 to 115.842,698 
 tons in 1908 or 64%, the excess in the mining fatality is 
 plainly a matter of most serious national concern. 
 
 The accident rate for the North American coal mines has' 
 gradually increased from an average of 2.66 per 1,000 during 
 the first five years of the 20 year period to an average of 3.58 
 per 1,000 during the last. 
 
 The fluctuations in the rates from year to year are quite con- 
 siderable. The maximum was attained in 1907 when the rate 
 reached 4.15 per 1.000 against a minimum in 1897 of 2.32. 
 
 The true elements of risk of coal mining in North America 
 are not, however, fully disclosed by the returns for the coal 
 fields as a whole. ]\Iore startling conditions exist, if particular 
 areas are considered, for in these the hazards are much greater, 
 so that if they were reduced to the general level the rate would 
 fall quickly. 
 
 The Xew York Times of Sept. 17. 1911, states, in referring 
 to the mining industry, including metal as well as coal mines: 
 
 ''Thirty thousand miners killed in the United States in the 
 last ten years.
 
 48 THE PRICE OF INEFFICIENCY 
 
 "Seventy-five thousand miners injured, many of them maimed 
 for life, in the same period. 
 
 "Eleven thousand widows made by the deaths of the miners. 
 
 "Thirty thousand children left fatherless. 
 
 "It is the story of the tragedy of the mines, but not the whole 
 story. If the mines of the United States during the ten years 
 had had the same standards of safety as in European countries; 
 if the United States had killed two in every thousand employed, 
 instead of three, four or five, 15,000 of the 30,000 of the Ameri- 
 can miners killed might be living to-day; 40,000 out of the 75,- 
 000 injured might have escaped injury; 5,500 widows might not 
 have been widows, and 15,000 orphan children might still have 
 fathers. ' ' 
 
 In addition to the vast totals of accidents of a sanguinary 
 nature, there is an enormous loss through poisoning and con- 
 sequent loss and shortening of the lives of those engaged in cer- 
 tain occupations. 
 
 Among them is the lead industry, concerning which Paul P. 
 Pierce in the North American Review of October, 1911, in an 
 article entitled "Industrial Diseases" states: 
 
 "Lead poisoning was made the chief objective of the Illinois 
 Commission on Occupational Diseases. They discovered in that 
 state, twenty-eight industries in which this form of poisoning 
 is a factor; but the great majority of cases were chargeable to 
 five industries, viz : white-lead manufacturing, lead smelting and 
 refining, making storage batteries, making dry colors and paints, 
 and the painters' trade. The last was found to be numerically 
 the most important lead trade in the state of Illinois, employ- 
 ing probably 30,000 men. Its workers acquire lead poisoning 
 for the most part through chewing lead smeared tobacco, eating 
 lead smeared food, breathing dry lead dust, mixing dry white or 
 yellow lead with putty or paint, and especially sand papering 
 coats of lead paint after they are dry. The hazard of this oc- 
 cupation might be greatly diminished, it is believed, by greater 
 care on the part of the painters; by provision of wash rooms in 
 which they may wash their hands, change their clothes and eat 
 their lunches, as in Germany ; by abolishing the use of white 
 lead paint, as in France, or using it only for exterior work, and 
 doing away with dry sand pafxTiiig of lead paint, as in Eng- 
 land. Indeed, it is coutt-ndcd that the lead trades in general 
 are the more dangerous here than iu England or in Germany,
 
 CONSERVATION OF HU]\IAN LIFE 49 
 
 Their evils, it is true, tend to lessen with the substitution of 
 machinery for hand work with other alleviation of conditions; 
 but the improvements in the care of the men do not keep pace 
 with improvements in mechanical processes. 
 
 "In the absence of adequate statistics and research, the actual 
 amount of sickness and death among the industrial population 
 must be a matter of "scientific conjecture." With German 
 sickness insurance as a basis Dr. F. K. Hoffman of the Pruden- 
 tial Life Insurance Company has attempted an estimate of the 
 amount and cost of sickness among our industrial workers in 
 1910, Placing the number of persons gainfully employed at 
 33,500,000 and assuming the same sickness rate as is found in 
 Germany, he finds that the number of cases of sickness among 
 these workers last year must have been 13,400,000; the aggre- 
 gate number of days of sickness 284,750,000; the loss of wages 
 not less than $366,107,145; the medical cost 284,750,000; the 
 loss through change of workers in industry on account of sick- 
 ness, $122,035,715, making a total economic loss among the in- 
 dustrial classes of $772,892,860 for the year. Of this total, 
 German experience indicates that no less than one-fourth is due 
 to preventable causes, a needless loss of $193,223,215. In fact, 
 it is thought that the sickness rate here is somewhat higher than 
 in Germany, and consequently that the above estimates are 
 too low. Moreover, these figures take no account of permanent 
 invalidity, and excessive mortality involved in present indus- 
 trial conditions; and Dr. Hoffman places the number of deaths 
 among American wage-earners last year at 330,500 of which no 
 less than one-fourth were clearly preventable. Nor do any of 
 these figures take account of the handicap which industrial dis- 
 ease and premature death imposes upon the posterity of the 
 worker. ' ' 
 
 All this tremendous waste is largely chargeable to govern- 
 mental inefficiency. It should be the duty of those in office to 
 forecast conditions of this kind of their own initiative. The 
 office holder, theoretically the representative of the people, is 
 too prone to remain inactive and do nothing that he is not com- 
 pelled to do by reason of pressure of public opinion. He is by 
 no means an initiator; indeed almost all reforms are brought 
 about by the cowardice of the people's representatives. 
 
 Vigorous committees of active reformers initiate almost all 
 laws, which are only passed when the legislator fears longer to
 
 50 THE PRICE OF INEFFICIENCY 
 
 disregard the public opinion which he thinks they represent. 
 A system of government producing such legislators is primarily 
 at fault and should be changed. 
 
 Counting it up in dollars and cents, the Department of Com- 
 merce and Labor shows the losses due to tuberculosis, a largely 
 preventable disease, the principal steps in the prevention of 
 which should be taken by the legislators of the various states.^ 
 
 "The average length of human life in different countries 
 varies from less than twenty-five to more than fifty years. This 
 span of life is increasing wherever sanitary science and pre- 
 venting medicine is applied. It may be greatly extended. 
 
 "Our annual mortality from tuberculosis is about 150,000. 
 Stopping three-fourths of the loss of life from this cause, and 
 from typhoid and other prevalent and preventable diseases 
 would increase our average length of life over fifteen years. 
 
 "There are constantly about 3,000,000 persons seriously ill 
 in the United States, of whom 500,000 are consumptives. More 
 than half of this illness is preventable. 
 
 "If we count the value of each life lost as only $1,700 and 
 reckon the average earnings lost by illness at $700 per year for 
 grown men, we find that the economic gain from mitigation of 
 preventable diseases in the United States would exceed $1,500,- 
 000,000 a year. In addition we would decrease suffering and 
 increase happiness and contentment among the people. ^ This 
 gain, or the lengthening and strengthening of life which it 
 measures, can be secured through medical investigation and 
 practice, school and factory hygiene, restriction of labor by 
 women and children, the education of the people, in both public 
 and private hygiene, and through improving the efficiency of 
 our health service, municipal, state and national." 
 
 On the subject of factory sanitation and labor protection, the 
 Department of Commerce and Labor says further: 
 
 "The welfare of the laboring class has always been a subject 
 of the greatest importance and most far reaching influence 
 socially and politically. The miserable hygienic conditions ex- 
 isting in the working places of some industries, for example, are 
 unjust to the working classes, and sometimes react with fright- 
 ful results upon the public. The aspirations of the working 
 classes to improve their condition in respect to sanitation is not 
 only perfectly justifiahle, but by all means should be encouraged. 
 With the nudtiplieation of factories, the improvement in the lot 
 of the working man has become a vital question of the day. Sta-
 
 CONSERVATION OF HUMAN LIFE 51 
 
 tistics and clear thinking convince him of the dangers to which 
 he is exposed by the conditions of his employment. 
 
 "Under the influence of long continued work under unsani- 
 tary conditions, the physiques of the workmen, and especially 
 those employed in factories, often show more or less character- 
 istic marks. The height is usually below the medium, the 
 body, thin and weak, is poorly nourished and of sickly paleness. 
 This condition is called lymphatic or anaemic. The spiritual 
 and moral life may likewise become inactive and apathetic. Even 
 the strongest factory workers under such conditions become 
 more or less exhausted before they reach 55 or 60 years of age. 
 Often they are completely wasted and utterl}^ unfit for work at 
 that age. Many of those who work in spinning mills, cloth- 
 printing establishments, and in general plants where there is 
 a high temperature and lack of pure air are cut off prematurely. 
 
 "Women suffer even more than men from the stress of such 
 circumstances, and more readily degenerate. A woman's body 
 is unable to withstand strains, fatigues and privations as well 
 as a man's. This makes her condition all the worse because 
 her wages are correspondingly smaller. The diseases which 
 most frequently afflict the worls:ing class are a disturbance of 
 the nutritive and blood-making processes. AVeavers, spinners, 
 and workmen employed in branches of industry, where work is 
 done in close, poorly ventilated cold or hot rooms, are especialty 
 subject to these diseases. 
 
 "Among the diseases which the workmen of this class are 
 subjected to most often are the so-called inanition, scrofula, 
 rachitis, pulmonary consumption, dropsy, also rheumatic trou- 
 bles, pleurisy, typhoid fever, gangrene, and the various skin 
 diseases. 
 
 "Every epidemic, be it typhoid, smallpox, scarlet fever, dys- 
 entery, cholera, etc., draws its great army from this class. For 
 every death that occurs among the richer and higher classes, 
 there are many in the working class. It is the workman en- 
 gaged in unhealthy factories first of all who fill the hospitals 
 and their death chambers. Again it is more often the working 
 woman who suffers from female troubles, and even cancer. The 
 reasons for the high mortality and shortness of life among the 
 working class can easily be perceived from the foregoing facts. 
 These two evils are always proportionate to the danger and the 
 unsanitary conditions existing in the industry. 
 
 "Loss of health and shortening of life are looked upon as
 
 52 THE PRICE OF INEFFICIENCY 
 
 the severest of evils that can be inflicted upon the individual. 
 The working classes themselves often call their condition white 
 slavery, and their factories and workshops slaughter-houses. 
 
 ''All the harmful influences which affect the workingman in 
 his various callings must therefore be thoroughly studied and 
 earnest effort made toward their amelioration or removal, not 
 only that the interests and health of the weaker members of so- 
 ciety may be protected, but also because the health of society in 
 general is both directly and indirectly menaced by unsanitary 
 conditions in any industry. 
 
 "When we go back to those causes to which the nations of 
 the present day owe their advance in culture and social condi- 
 tions, we find that one of the most important and essential 
 causes of this most desirable advance lies in the deeper recog- 
 nition of those natural conditions upon which depend the life 
 and well-being of the individual and the prosperous develop- 
 ment of society. 
 
 "The sciences alone would have added but little if any real 
 elevation of the general conditions of well-being. Science, at 
 times, had to descend from its lofty regions to meet the neces- 
 sary demands of daily life. It had to make the laws and needs 
 of human existence the object of its most comprehensive re- 
 searches. It had to bring to light their relation to and connec- 
 tion with the external conditions of life. It is only by means 
 of these that more rational rules of life can be formulated. It 
 is in the manifold transgressions of these laws, in the unreason- 
 able gratifications of certain needs, in the almost criminal ig- 
 norance and disregard of the injurious influences, that the causes 
 and sources of many evils are to be found. Such evils are 
 especially prevalent in the conditions which surround industrial 
 establishments and their workers. 
 
 ' ' To understand the evils which threaten the industrial classes 
 and to search for their remedy, is one of the pressing needs of 
 the day. To obtain the correct point of view for the solution 
 of these important questions, an unprejudiced and searching 
 investigation is first of all necessary. 
 
 "The attention of foreign countries has been for a long time 
 directed to the economic traits which aim at the improvement 
 and extension of the methods of production. Nothing is neg- 
 lected whieli may protect and raise the interests of industry. 
 But hitherto too little attention has been given to those unsani- 
 tary factory conditions Avhich imperil the lives and health of
 
 CONSERVATION OF HUMAN LIFE 53 
 
 the worker. These conditions have risen largely as the result 
 of the increasing population in manufacturing to^^'Tls and they 
 affect not only the workingman, hut also the manufacturers of 
 the whole nation. 
 
 **The present concentration of population in large manu- 
 facturing cities is not in the interest of public hygienic and 
 economic principles in such a measure as might easily he as- 
 sumed. The characteristic increase in the industries in Ameri- 
 can cities is nothing if not remarkable. The factory is the 
 symbol of the day, and steam and electricity are the rulers of 
 the present. Our age has learned to utilize the forces of nature 
 and thus has made gigantic strides forward. The more atten- 
 tion is paid to the improvement of the conditions of health of 
 the working class, the more surely will those favorable results 
 be obtained for which the American strives. 
 
 "The successful development of factory sanitation and the 
 protection of the workers in factories require: 
 
 "1. Systeniatic education in respect to the many dangers 
 which, in certain industries, threaten the worlcman and the 
 public. 
 
 "2. The institution of technical preventative measures based 
 upon a sound practical as well as theoretical foundation and 
 whose aim shall be to remove the causes of all existing evils 
 that injure the health. 
 
 "Public sentiment is more favorably inclined towards such 
 a problem than at any previous time. There is now in the in- 
 dustrial occupations little of that mediosval seclusion which 
 made the discovery of natural laws the closely kept secret of 
 the guild or school, and which always strongly opposed the 
 adoption of new discoveries. The great value of open inter- 
 communication and instruction, in so far as they concern fac- 
 tory sanitation, labor protection, and the preservation of life, 
 is recognized. The exertions and attainments of the individ- 
 ual under these conditions are thus of greater value to the 
 country at large. They smooth the way for those that aim at 
 similar results, and make their attainment more certain."
 
 CHAPTER VI 
 BY-PRODUCTS OF INEFFICIENCY 
 
 National bunglioles — Frightful wastes of carelessness — Cutting the throats 
 of American forests — Train of evils of our forest policy — Terrible 
 losses from conflagrations — How $500 a miniite goes up in smoke — 
 A thousand mile avenue of desolation — Insurance ten times as ex- 
 pensive in the United States as in Europe — Antiquated fire fighting 
 methods of the United States — The fiery trail of the insect across the 
 farm — The coddling moth and its hundreds of millions of annual 
 damage — How the American farmer wastes $3,000,000 a day — The 
 losses of transportation — Haphazard efforts of theatrical producers — 
 The strangle hold of monopoly on the American drama — ^The gamble 
 of the first night — "Giving the public what it wants" — Butchering 
 foreign plays — Annual railroad waste — Inefficiency of railroads and 
 industrial plants compared — Why the public is to blame. 
 
 As in many industries, the by-products assume a greater im- 
 portance than the original, so in inefficiency, the indirect results 
 aggregate totals comparable with the direct results. The fail- 
 ure to exercise ordinary precautions, the failure to take ad- 
 vantage of the best methods, the failure to adopt new ideas, 
 and the failure to seize industrial opportunities are equivalent 
 in costliness to direct losses from inefficiency. 
 
 In the failure to take ordinary precautions against fire, and 
 in carelessness and faulty construction, losses amounting to 
 three-quarters of a million dollars a day are incurred through- 
 out the country. 
 
 The excessive and wasteful use of wood in buildings is largely 
 responsible for fires, and wood is used because of its apparent 
 cheapness. Ultimately wood is a high priced building material, 
 since its true value, in the first place, as has been indicated, is 
 much higher than the selling price. The sacrificial price of 
 wood has thus resulted in the erection of a large number of 
 buildings of an inflammable and quickly deteriorating nature. 
 
 If the wood were selling at its true value, and proper build- 
 ing laws were in force, both of which would be the case under 
 efficient administration; the forests would be properly con- 
 
 64
 
 BY-PRODUCTS OF INEFFICIENCY 55 
 
 served and the great losses of fire largely prevented, and a 
 double result of inefficiency cured. 
 
 The annual fire waste in the United States for the four yeara 
 1906 to 1909 was $1,257,716,955 or an average annual loss of over 
 $251,000,000. This is a daily average loss of $689,160. It is 
 true this period included the San Francisco and Baltimore 
 fires. Extending the period to ten years the loss was $2,029,- 
 734,345, giving an average annual loss of $202,793,434 or an 
 average daily loss of over half a million dollars ($556,091). 
 
 The yearly losses, according to the records kept by the New 
 York Journal of Commerce for the United States have been in the 
 last fifteen years as follows : 
 
 1911 $234,337,250 
 
 1910 234,470,600 
 
 1909 203,649,200 
 
 1908 238,562,250 
 
 1907 215,671,250 
 
 1906 459,710,000 
 
 1905 175,193,800 
 
 1904 252,554,050 
 
 1903 156,195,700 
 
 1902 149,260,850 
 
 1901 164,347,450 
 
 1900 163,362,250 
 
 1899 136,773,200 
 
 1898 119,650,500 
 
 1897 110,319,650 
 
 It will be noticed that the losses, though varying greatly from 
 year to year, have more than doubled during this period 
 of time, a condition of the most disquieting nature. 
 This waste is an absolute loss of the wealth of the country. 
 The property destroyed by fire is beyond recoverj^ Insurance 
 only shifts the distribution of the loss. An irrecoverable loss 
 it still remains. 
 
 The cost of preventative measvires, maintenance of fire de- 
 partments, protective agencies and additional cost of water sup- 
 ply raises the annual total $225,000,000 more. 
 
 A notable fact in the analysis of fire losses is that 27% were 
 due to exposure — that is, the fire extending beyond the build- 
 ing in which it originated. The extension of fire results from 
 the use of inflammable materials in construction. It is even 
 more noticeable that only $68,000,000 of the loss was on brick, 
 concrete, stone and other slow burning constructions, while over
 
 56 THE PRICE OF INEFFICIENCY 
 
 double that amount, or about $148,000,000 was on frame build- 
 ings. In the last thirty-three years, the total fire waste 
 amounted in value of property destroyed to more than $4,500,- 
 000,000. 
 
 It is a reasonable estimate that one-fifth of the city water 
 supply and distribution charges, three-fourths of the fire de- 
 partment charges, and over four-fifths of the fire losses, or a 
 total of nearly $400,000,000 per year, may be considered a pre- 
 ventable tax on the nation. 
 
 From reports of United States consuls it has been shown that 
 the loss in six European countries for a period of five years was 
 33 cents per capita. The loss in the United States for the five 
 years ending with 1907 was $3.02 per capita, nearly ten times 
 as much. 
 
 The result in thirty foreign cities gave a per capita loss of 
 61 cents as against $3.10 in the five years' average of 252 cities 
 in the United States. 
 
 Taking the number of fires to each 1,000 of population in the 
 same cities, the committee on statistics found it to be 4.05 in 
 the American cities, as against 0.86 for those of Europe, show- 
 ing also that, in point of frequency, fires here are far in excess 
 of those abroad. 
 
 It is to be borne in mind that the direct fire loss is not the 
 only waste of resources. Owing to the greater frequency of 
 fires in the United States, and their greater destructiveness, 
 more expensive fire exting-uishing facilities and apparatus must 
 be maintained here. 
 
 "We may add that it has been stated that as many as 7,000 
 lives have been lost by fires in the United States in a single 
 year. 
 
 The excessive difference between the fire waste of European 
 countries and that of the United States is caused principally by : 
 
 First : The difference in the point of view and the responsi- 
 bility of the inhabitants of Europe and those of the United 
 States. 
 
 Second : Tlie difference in the constraction of the buildings. 
 
 Third : The regulations governing hazards and hazardous ma- 
 terials and conditions, and in the enforcement of such regula- 
 tions. 
 
 ]\rr. Powell Evans in "Fire Waste" in the Survey of July 
 1, 1911, states: 
 
 "The 1910 fire loss would pay the total interest bearing debt
 
 BY-PRODUCTS OF INEFFICIENCY 57 
 
 of the country in four years; or would build the Panama canal 
 in less than two years. In other terms, it exceeds the com- 
 bined cost of the United States Army and Na\'y and the inter- 
 est on the National debt; or nearly equals the combined annual 
 failures and pension payments in the United States; or exceeds 
 the combined United States gold and silver production and 
 Post Office receipts. These are all annual figures. 
 
 "It represents about 40% of either the total unused United 
 States Government receipts or total expenditures, or the net 
 earnings of American railways; it represents about 80% of 
 either the United States Internal Revenue receipts or the 
 United States Customs or the interest paid on the railways in 
 the country^ It exceeds the combined annual value of the wheat, 
 hay, oats and rye crop, and it is twice that of the cotton crop. 
 It costs about $30,000 for each hour in the year and $500 for 
 each minute. It costs, moreover, more than 1,500 lives and 5,000 
 serious accidents annually. 
 
 "If all the buildings burned last year in the United States 
 were placed together on both sides of the street, they would 
 make an avenue of desolation reaching from Chicago to New 
 York, and although one seriously injured person were rescued 
 every thousand feet, at every three-quarters of a mile a man, 
 woman or child would nevertheless be found burned to death. 
 "There are certain conditions in foreign countries that op- 
 erate to affect a lower fire loss than would reasonably be pos- 
 sible here, viz: The larger use of non-combustible materials, 
 due to the higher cost of wood; better building codes, in letter 
 and practice; the lower height and smaller areas involved in 
 city construction; and finally the intangible influence of older 
 civilizations, which makes people more careful of small savings 
 in all their affairs, and generally more cautious than we have 
 yet become. 
 
 "Allowing duly for these fundamental differences between 
 the countries compared, it is yet apparent that the differences 
 in the fire loss in the United States over that of the principal 
 western European countries is outrageously and criminally 
 greater than it should be ; and this condition must arise largely 
 from the ignorance, the carelessness and the indifference of 
 this countrA-'s inhabitants. Ignorance, carelessness and isolated 
 self-interest, when they result in the tremendous sacrifices of 
 life and property now habitually occurring among us from this 
 one cause, become nothing less than criminal."
 
 58 THE PRICE OF INEFFICIENCY 
 
 In the United States insurance costs on the average $3 per 
 capita, while in Europe it is only thirty cents per capita. And 
 everyone, although not insuring directly, pays his share, in one 
 way or another, of insurance, through higher rents and higher 
 prices of commodities manufactured and sold in insured build- 
 ings. 
 
 The application of the remedies for fire waste will be slow, 
 but they are nevertheless forcing themselves upon the atten- 
 tion of a public as careless as the American public. 
 
 American Fire Departments need throughout, a complete 
 overhauling. Antiquated methods and apparatus are proving a 
 costly burden. The fancied superiority of the departments and 
 the self-satisfaction displayed should be promptly exploded. 
 
 Often the system of fire alarm depends on a single center of 
 distribution for a whole borough or city. It is as though the 
 telephone system were centered at a given point, damage to 
 which should put the whole out of commission. Surely there 
 should always be a distributing system, so arranged with dif- 
 ferent centers that one or several might be eliminated and still 
 leave means of communication between the remaining centers 
 effective. 
 
 In outlying districts particularly, are fire alarm wires ex- 
 posed and subject to damage and interruption. They are so 
 frequently interrupted in fact, that in New York, for example, 
 an average may be struck as to how many interruptions may 
 be expected to occur during any given period. 
 
 Not only are fire alarm systems defective in this particular, 
 but as indicated, the method of ringing alarms is such that there 
 is much time wasted in starting to the fire. The alarms should 
 appear instantly, as annunciators in hotel room signal sys- 
 tems. Often the horses are hitched and the engines ready to 
 go before the alarm signal to tell them the location of the fire 
 is completed. 
 
 Owing to the brave and capable personnel of the American 
 Fire Departments the best possible results are produced with 
 the equipment at hand, but it is in the administration that the 
 departments fail. Although less subject to political interfer- 
 ences than the police departments, nevertheless interested mo- 
 tives appear and produce the customary inefficiency. 
 
 Abroad, the heads of departments are either trained engi- 
 neers or administrators, and if not engineers, they are assisted 
 by advisoiy engineers. The highest degree of technical train-
 
 BY-PRODUCTS OF INEFFICIENCY 59 
 
 ing is thus brought to the service of the departments, for such 
 men make the subject a life study. 
 
 The American public reading only the stories of heroism of 
 the individual fireman, is not aware of the true conditions ex- 
 isting in the departments, and how behind the times the equip- 
 ment and appliances are. Even when our reforms do come, 
 they come in a most belated fashion. When we are beginning 
 to adopt automobile fire engines, as at present, such engines 
 are being discarded abroad in favor of electric engines. ]\Iany 
 German cities, since 1905, have successfully adopted electrically 
 propelled fire fighting apparatus and that is the universal tend- 
 ency at present. 
 
 The United States Consular report of August 9, 1911, states : 
 
 "The city of Berlin has also adopted electricity as a motive 
 power for their fire department, four stations being already 
 fully equipped, horses and gasoline motors being dispensed 
 with. Among the many advantages of the system was a saving 
 of over half the cost where horses had been used, also a won- 
 derful saving of time, it taking but 12 seconds from the time 
 an alarm was sounded until the department was fully under 
 way in the street. Safety and simplicity of operation were also 
 fully demonstrated. ' ' 
 
 Perhaps the most striking illustration of the inefficiency of 
 American fire departments was seen in the notable Equitable 
 Life Insurance building fire in New York, 1912. 
 
 In the vaults of a bank in the building, several men were 
 trapped, and the heavy gratings prevented their escape. 
 Finally, after hours of work, the gratings were sawn through 
 and all but one of the men escaped, but this one, an unfortunate 
 watchman, died with his hands outstretched toward the street, 
 his escape cut off by the heavy bars. 
 
 It might appear that all that human power could do was 
 done to effect his escape, and perhaps it was, with the tools at 
 hand, yet no man ever struck down in premeditated murder was 
 a more miserable victim to human treachery than this man w^as 
 to official neglect and incompetency. 
 
 Hours were wasted sawing iron bars, the most antiquated 
 method of succor that could have been adopted. Had the de- 
 partment provided itself with a very simple device, in use for 
 a number of years in scores of garages and repair shops in the 
 city, the man could have been saved with little trouble. The 
 device is knovm as the oxo-acetylene or hydro-oxygen torch,
 
 60 THE PRICE OF INEFFICIENCY 
 
 and it consists of a small but intense flame fed by the two 
 g-ases, from portable tanks. It was used in the work on the 
 Maine at Havana recently, and in the removal of the Quebec 
 bridge wreck. The iron bars which imprisoned the Equitable 
 victim could have been cut through in a few minutes by the 
 flame, like so much cheese and the man's life saved. 
 
 Even had the department not had at hand such an apparatus, 
 a telephone call to any one of a dozen establishments would 
 have brought a suitable outfit, long before any sawing could 
 have accomplished the desired result. Surely this man was 
 murdered, and his hands stuck through the ice for days before 
 his body could be reached and removed, were lifted in a mute, 
 unconscious appeal for mercy and justice. 
 
 Yet even with this case before them, how many of the fire 
 departments of American cities are provided with such ap- 
 paratus for use in contingencies which are bound to arise. 
 
 During the progress of the fire, three men appeared on the 
 cornice at the northwest corner of the building, directly above 
 the vault in which the men were imprisoned by the iron bars. 
 They were trapped by the flames and were in what soon proved 
 to be a fatal extremity. What was done to rescue them? 
 Surely the inefficient means employed convict the department 
 of murderous negligence and on no less than three counts. 
 
 In the first place, a ladder was raised which by no possibility 
 could have reached the men, being far too short. Certainly 
 the length of the ladder was known in advance, while the height 
 of the building was apparent. "What possible purpose could be 
 expected to be served by lifting the ladder is not obvious. Were 
 the chiefs hysterical, or simply fools? They must have known 
 in advance that there was no possible hope in lifting the ladder. 
 
 Why then was valuable time lost in the operation? 
 
 Finding by experiment the fact that should have been real- 
 ized in advance, the ladder was abandoned and efforts made to 
 throw a life line from an adjoining taller building. Why, it 
 may be asked, was the throwing of the life line delayed until 
 after the abortive experiment of the ladder-lifting? Is a fire- 
 man unable to think of more than one expedient at a time? 
 Nothing prevented the throwing of the life line earlier. It 
 did not need to Avait on the ladder. 
 
 Yet after the line was thrown and the men attempted to make 
 use of it, it parted; according to the report being burned 
 through by the flames below. The result was that two of the
 
 BY-PRODUCTS OF INEFFICIENCY 61 
 
 men fell to the street and were crushed, while the third dropped 
 back into the hell of fire Avithin the walls. 
 
 What was the occasion for the life line breaking or burning 
 through? If it was burned through, it was not properly fire- 
 proofed, as such lines should invariably be. Perhaps it was 
 only an ordinary piece of rope, picked up nearby. Or if it 
 was fireproof ed why should it break? Was it old and rotten? 
 
 For the third count, there was no life net in the street. 
 Surely humanity can be shocked in no way as by the idea of 
 men falling from such heights. No nets appear to have been 
 spread and the men fell directly to the pavement. 
 
 Although falling into nets from a great height, while prac- 
 ticed with some success by acrobats, is likely to have serious 
 consequences from the dislodg-ment of the internal organs from 
 shock, surely the victims could not be worse off than in falling 
 into the street. Properly constructed, life nets are not liable 
 to give way, and the negligence of the department in not hav- 
 ing such appliances ready or in not utilizing them if they were 
 at hand is inexcusable. 
 
 Throughout the details of fire fighting, the systems are either 
 out of date, or the latest modern devices have not been adopted. 
 For example, the fireman's helmet, which is connected with an 
 oxygen supply and water supply, is not in use. Clothed in a 
 fireproof suit, breathing through the oxygen tube and with 
 water pouring over him from such a helmet, a fireman can lit- 
 erally pass through flames, while smoke is no obstacle whatever. 
 
 A few such helmets in use in fire departments would be the 
 means of saving a great number of lives every year, of those 
 who, overcome by smoke, cannot be reached by firemen equipped 
 as they are at present equipped. No amount of heroism can 
 take the place of such an apparatus. Doubtless some of the 
 apparatus may be expected to come into use in five or ten years. 
 
 The conservatism which prevents its immediate adoption 
 is difficult to understand. In the principal piece of equipment, 
 it is predicted that horse drawn engines will disappear in five 
 years. They disappeared ten years ago in European cities. 
 It may be that there are not enough "practical" men behind 
 the new forms of apparatus. 
 
 The enormous damage from the use of too much water is 
 another serious indictment of our fire fighting methods. Ex- 
 cept in cases of conflagration or where buildings are gutted, 
 the water damage is unnecessarily great, and often is greater
 
 62 THE PRICE OF INEFFICIENCY 
 
 than the damage from the fire itself. Not infrequently fatali- 
 ties are due to drowning in flooded basements, rather than to 
 suffocation. 
 
 The great consumption of water in American cities as com- 
 pared with foreign cities may be seen from the following exam- 
 ples taken at random: 
 
 Pittsburg 220 gallons per day per capita ; Buffalo, 310 ; Phil- 
 adelphia, 205 ; Chicago, 225 ; Salt Lake City, 310 ; Paris, 65 ; Lon- 
 don, 39 ; Liverpool, 38 ; Amsterdam, 37 ; Dresden, 26 ; and 
 Berlin, 22. Even with these small amounts, the foreign cities 
 have their streets and sidewalks flushed regularly. While only 
 a small part of the American excess may be due to uses of fire 
 departments, it is caused by reasons which produce inefficiency 
 in the fire departments and throughout the whole municipal 
 administrations. 
 
 It is the boast of American fire chiefs that they manage to 
 flood buildings with certain enormous quantities of water. 
 This is a boast of inefficiency. Abroad the fire chief reports 
 how few gallons of water he was able to use in putting out a 
 fire. There, apparatus is used which throws the water in thin 
 sheets under high pressure and extinguishes the fire without 
 flooding the lower floors, or in fact, in many cases even without 
 wetting them, as it is evident that a small volume of water 
 under high pressure will put out a fire more effectively than 
 a mere flooding of the floor. Smaller hose is generally used, 
 which makes it more available, while every modern device for 
 fire fighting is also employed. 
 
 One of such devices which might be adopted with great bene- 
 fit in many American cities is the endless bag fire escape, reach- 
 ing from a window to the street, the lower end being held some 
 distance away from the building. Thus a person sliding down 
 inside the bag, shoots out at the bottom in a horizontal direc- 
 tion, instead of dropping vertically as down a rope. 
 
 The reason given for not adopting the small hose, high pres- 
 sure system here is that it has been tried and not found prac- 
 tical. This may be the same practical that was encountered in 
 the case of the fire engines. 
 
 The excessive and wasteful use of wood in buildings is largely 
 responsible for fires, and wood is used because of its apparent 
 cheapness. Ultimately, wood is a high priced building ma- 
 terial, since its true value, in the first place, is much higher 
 than its selling price, and its durability is so much less than
 
 BY-PRODUCTS OF INEFFICIENCY 63 
 
 other materials. The failure to renew forests and the sacrifi- 
 cial price at which wood is sold, representing only the cost of 
 getting it to market and not the cost of reproducing the forest 
 crop, has resulted in the erection of a large number of build- 
 ings of an inflammable and quickly deteriorating nature. If 
 wood were selling at its true value and proper building laws 
 were in force, both of which would be the case under efficient 
 administrations, the forests would be conserved and the great 
 loss of fire largely prevented. 
 
 The use of proper apparatus to extinguish fires would effect 
 large savings, but it must not be lost sight of that the greatest 
 saving would result from greater precautions on the part of the 
 public, since the fire department is never responsible for caus- 
 ing a fire, leaving that entirely to the public. 
 
 The losses by fire principally occur in the cities, but though 
 seldom considered by the public, the rural districts, by way of 
 the compensations of Nature, seem to be subjected to a form of 
 what, to see its results, appears to be a living fire. Swarms of 
 noxious insects passing over a district Mall leave it almost as 
 bare as would a forest fire, and undo in a few hours the labor 
 of the farmer for months and years. Yet this form of destruc- 
 tion, too, is largely the result of carelessness and lack of the 
 use of known preventatives. 
 
 The losses from insects in the rural districts amount to three 
 or four times the total of city fires, and they are augmented by 
 the depredations of mammalian pests. 
 
 The National Conservation Commission, 1909, states: 
 
 "Aside from careless or ignorant farming and such hostile 
 climatic conditions as storms and droughts, the most serious 
 enemies to crops are noxious insects and mammals. 
 
 "The chief insect enemies of the grains are the corn-root 
 worm, the bollworm, the chinch bug, the Hessian fly, plant lice, 
 grasshoppers, cutworms and army worms. The woret enemy 
 of cotton is the boll weevil. Fruits are injured chiefly by the 
 coddling moth and the San Jose scale. The Bureau of Ento- 
 mology estimates that the annual damage by noxious insects is 
 no less than $659,000,000. This total includes the cost of pre- 
 ventative measures which greatly reduce the annual aggregate 
 loss. 
 
 "The average yearly loss to animal products from flies, ticks 
 and other insects is estimated at $267,000,000. This does not 
 include the enormous loss of human life and the cost of disease
 
 64 THE PRICE OF INEFFICIENCY 
 
 due to house flies, mosquitoes, fleas and other germ carrying in- 
 sects — a loss much greater than that suffered by the live stock 
 and their products. 
 
 ''The Biological Survey estimates that the damage to live 
 stock and crops by wolves, rats, mice, prairie dogs, foxes and 
 other mammals averages over $100,000,000 yearly. This figure 
 also includes the cost of preventative measures; without which 
 the losses would be much greater. Birds are generally benefi- 
 cent as destroyers of noxious insects and mammals. 
 
 ' ' These figures are staggering in the aggregate, but they must 
 be regarded as trustworthy and as representing an enormous 
 scale of preventable loss." 
 
 According to the Bureau of Statistics of the Department of 
 Agriculture, the average loss by disease during the past five 
 years was: 
 
 "Among horses, 1.8%; among cattle, 2%; among sheep, 
 2.2% and among swine, 5.1%. The aggregate annual loss av- 
 eraged $93,000,000. 
 
 ''The most preventable disease among cattle and swine is 
 tuberculosis; it is estimated that at least 1% of the beef cattle, 
 10% of dairy kine, and 2% of swine are affected. Sheep and 
 cattle suffer seriously from scabbies, while hog cholera is preva- 
 lent among swine. Texas fever among cattle, transmitted by 
 a tick, is a destructive disease, causing a direct animal loss es- 
 timated at $40,000,000. All these diseases are remediable and 
 some or all may be eradicable. 
 
 "The total annual losses to the agriculture of the country 
 including live stock, animal products, and grain in storage, 
 from insects, mammals, and disease is estimated at $1,142,- 
 000,000 or one-sixth of the total production. 
 
 With inefficiency of fire wastes and rural wastes, may be in- 
 cluded the wastes of transportation, which has been so keenly 
 discussed recently in the efforts of shippers to keep railroad 
 rates within reason. 
 
 Yet in the discussion but little reference was made to the 
 enormous freight hauls due to the location of manufacturing 
 plants at great distances from the sources of their raw ma- 
 terials, a condition analogous to the allowing of emigrants to 
 settle in one locality instead of distributing them to places 
 where they might be needed. 
 
 The loss due to careless handling of freight is another, the 
 total of which though large is difficult to ascertain. On a
 
 BY-PRODUCTS OF INEEFFICIENCY 65 
 
 freight station platform, a boxed piano will be thrown on its 
 side without the slightest care on the part of the handler. The 
 piano company cannot object, as their goods would only be the 
 more roughly handled thereafter, but several hundreds of dol- 
 lars' worth of damage is done, and no responsible source can be 
 reached. 
 
 Ordinary baggage is smashed without compunction, and no 
 definite figures as to the loss can be computed. Instead of an 
 objection which would have an effect in the discontinuance of 
 such wanton destruction, the system merely furnishes point for 
 witticisms in comic papers. 
 
 In the handling of eggs, however, it has been estimated that 
 losses amounting to $40,000,000 a year are incurred through im- 
 proper handling which extends back to the farmer himself. 
 
 The thro^ving around of eggs in this reckless manner on 
 freight depot platforms is a particularly noticeable example of 
 a double waste, since if the eggs so mistreated were reserved 
 for similar uses in other places, theaters for example, the eggs, 
 though still sacrificed, w^ould induce no little improvement in 
 histrionism and the drama generally, an improvement to which 
 it is certainly entitled. 
 
 An improvement in the theater would reflect itself in an im- 
 proved tone of the morals of the public. Thus it may be seen 
 that the egg handlers are Largely to blame for the uninspired 
 condition of the theater, and consequently, any laxity of con- 
 duct which may be observed on the part of the public. 
 
 The theater, which holds the mirror up to nature, often a 
 mirror of distorted glass in which Nature could hardly recog- 
 nize herself, manages to have the holding done by a curious set 
 of persons known as managers, who spend most of their time 
 in "giving the public what it wants." A certain real want of 
 the public, that of some convenient movable object, they seldom 
 undertake to supply, preferring it scrambled. 
 
 Managers are strenuously engaged, along with some twenty- 
 five thousand actors and other performers, in giving the public 
 what it w^ants, or to be more accurate in giving the public what 
 they figure out it wants. In this process they have unlimited 
 access to all the dramatic ideas which have ever been used, or 
 which are ever likely to be used, and in addition, a vast fund 
 of plays from abroad, and yet statistics prove that only one play 
 in five is a substantial success. 
 
 Managerial efficiency may thus be placed at about 20%, a
 
 66 THE PRICE OP INEFFICIENCY 
 
 result which springs from the presence in the managerial field 
 of a large number of individuals who have little or no knowl- 
 edge of the drama as an art, but who are there for the purpose 
 of making money. They gamble on new productions one after 
 the other, selecting them with little rhyme and less reason, and 
 the profits of the one success out of five attempts is sufficient 
 to enable them to continue in the business. From the stand- 
 point of social economy, the ratio of successes to failures proves 
 that the present theatrical system is highly inefficient. No well- 
 organized industry should show such poor results. 
 
 In the vaudeville field, an exceptionally absurd method is in 
 vogue, that of trying out acts. The small manager or actor 
 who would get his act into the vaudeville circuits of theaters, 
 must rehearse and play it at his own expense for a time, until 
 it is approved by the managements. All this waste of time and 
 effort, for there are not less than ten try outs for every act 
 that gets booking, could be avoided by the simple reading of 
 the manuscript by the managers in advance. Yet they do not 
 seem to understand that the expense which attaches to the 
 numerous failures to get acts accepted, causes such loss and 
 discouragement to the producers that the forces tending to sup- 
 ply them with new acts are vitiated, and the whole attractive- 
 ness of their programmes hurt permanently. 
 
 Separate trusts control the regular and vaudeville theaters 
 to such an extent that the production of a piece depends on 
 the will of one or two men. It is obvious with individual 
 initiative choked off in this manner that the theater must lose 
 its force and variety, and be permeated with a class of plays 
 more or less in accord with the opinions of those who rule the 
 destinies of the theaters. Variety is thus lost. That this con- 
 dition exists is shown by the fact that the theater to-day is in a 
 financial condition such as it never sunk to before. The theat- 
 rical managers who have shown independence are ruined or 
 driven into other lines of business by the destructive methods 
 of the trust, which largely consist in arranging the routes of 
 the traveling companies of the blacklisted managers in such 
 manner that great distances intervene between the stops on the 
 route. Thus profits are eaten up by railroad fares. 
 
 Rebellion against this system is well nigh impossible since, 
 owing to their control on the other hand of the privilege of 
 booking the plays, should the manager of a theater leave the 
 syndicate booking, he would get no plays to present in his
 
 BY-PRODUCTS OF INEFFICIENCY 67 
 
 house. The syndicates thus stand between both the proprietors 
 of the theaters and of the plays, and use one with which to club 
 the other into submission. This iniquitous system has been in 
 vogue some fifteen years or more, but it is having a hard row 
 to hoe at present due to the fact that the public, having been 
 exploited by other trusts have no money with which to patron- 
 ize the theatrical trusts' attractions, and instead are going to 
 the cheaper and inferior moving picture theaters and stock 
 companies located in the various cities permanently. It will 
 thus be seen that it takes a trust to scotch a trust. 
 
 One of the causes which produces managerial inefficiency is 
 that of "adapting" or ''Americanizing" foreign plays. This 
 is carried on with so little regard for the integrity of thought 
 of the author that he is relegated to a most obscure position. 
 Even in the case of native authors, the smallest piece of furni- 
 ture about the theater is usually the author. He is frequently 
 allowed no place at rehearsal, except the freedom of roaming 
 up and down the back aisle of the theater, while the stage man- 
 ager and actors proceed to make the play into what the public 
 wants, according to their idea of it. The manager, risking his 
 money, feels that he has the right to mold the play according 
 to his own opinions. Too often, however, although the author 
 may show exuberances that should be checked, the manager is 
 similarly at fault with no power to check him, except the in- 
 sulted intelligence of the audience which tells him in the end 
 unmistakably by the empty condition of the box office. 
 
 A great proportion of the plays from abroad fail in America, 
 yet this is after the managers have seen them played abroad, 
 know how the production should be made, and should know 
 how they ought to be received by American audiences. In 
 many cases, however, portions of the play, which the managers 
 decide the American audience "will not stand for" are elim- 
 inated, and then failure is wondered at. 
 
 A striking example of what a manager can do when he tries 
 his best, is seen in the production of "The Great Name," 
 adapted from the German after having proved a great success. 
 
 Louis Sherwin, a critic on the New York Glohe, writing in 
 the issue of Oct. 14, 1911, describes the process and its results: 
 "About the most remarkable recent instance of this is the 
 American production of 'The Great Name.' It is remarkable 
 because the changes made by the producer were more glaringly 
 unnecessary than usual. Here was not a case of an untried
 
 68 THE PRICE OF INEFFICIENCY 
 
 piece of doubtful value. It was acted originally as the author 
 intended it should be, and it pleased the public it was written 
 for. The producer had every chance of seeing what effect it 
 had when played before a theater full of people. It was — 
 and is still to some extent — a comedy of real delicacy and sen- 
 timental charm. And yet all manner of vulgarisms were in- 
 truded in order to 'Americanize' it. 
 
 "Take the character of the music publisher, for example. 
 In the original he is described as follows: 'A genial, well- 
 dressed, well-groomed gentleman, without diamonds, shrewd, 
 over-polite, and without accent except when under excitement.' 
 
 "In the American production this person becomes a vulgar 
 and abounding old clothes merchant — one of the cheapest, most 
 hackneyed figures of vaudeville and burlesque, the typical 
 'comic' Hebrew, brimming over with ten-twenty-thirty humor. 
 
 "As the German authors wrote it, the composer's mother 
 must have been a charming old character, such a woman as you 
 might imagine being the mother of a man half genius and half 
 child, who was always very much in need of being mothered. 
 This crops out all through the play; for whenever Hofer be- 
 comes excited, whenever he flies off in a tantrum, and is in 
 danger of upsetting everything by his temper, it is his mother 
 who calms him and smooths over all difficulties. It is she, 
 moreover, who transacts all his business for him and sees that 
 his home is quiet and comfortable. At the Lyric this part is 
 acted by Lizzie Hudson Collier, who performs it in the stiffest 
 manner imaginable, and makes of it the traditional grand dame 
 • — another hackneyed stage figure, quite out of place in a piece 
 of this nature. Inasmuch as this actress has previously dis- 
 played much intelligence in other roles, one is led to the con- 
 clusion that she employed such an incongruous method because 
 she was told to. 
 
 "Furthermore, as the principal characters are musicians, the 
 environment known as a 'musical atmosphere' is eminently nec- 
 essary. But not in any one of the three acts do these person- 
 ages move amid surroundings they would be likely to affect in 
 
 real life. 
 
 "Now all these defects spring from the tendency of certain 
 American managers to ignore the author. After all, the play- 
 wright has some rights other than to the payment of royalties. 
 To be sure, they are the most important, but the writer is en- 
 titled to have some attempt made to convey his meaning to the
 
 BY-PEODUCTS OF INEFFICIENCY 69 
 
 public. Moreover, it is impossible to dismiss the conviction that 
 in the long run it will pay to give some heed to the intentions 
 of the man who wrote the play. In numerous other cases, the 
 same policy has proved disastrous, and the 'practical theatrical 
 men' have been so ruthlessly practical that they have lost 
 money. ' ' 
 
 Private management of theaters, while it gives full play to 
 individual initiative, cannot greatly excel, it would appear, the 
 results which would be achieved in municipal and governmental 
 theaters. 
 
 Private management, though praised as a system, does not 
 in reality have the great advantage over governmental manage- 
 ment that is generally supposed, no matter what phase is con- 
 sidered. 
 
 Private management in its operation of the railroads, where 
 it has had full sway, has proven wasteful and extravagant, and 
 the much vaunted superiority of private management to gov- 
 ernment management is not clearly in evidence. 
 
 Mr. Harrington Emerson, eminent on Efficiency Engineer- 
 ing, says in the Engineering Magazine for October, 1911 : 
 
 "Railroads spend for supplies $500,000,000 a year. The av- 
 erage efficiency in industrial plants is not above 60%. TVe can 
 allow 70% for the railroads. The annual waste is $150,000,000. 
 
 "The railroad payroll is $1,000,000,000. The average indus- 
 trial efficiency in personal service is about 60%. In the rail- 
 roads we can allow 70%, and the annual waste is $300,000,000. 
 
 "The efficiency of fixed charges in industrial plants is rarely 
 higher than 25%, unless they run twenty-four hours a day. 
 Fixed charges cost railroads $800,000,000 a year; allowing an 
 efficiency of three times that of industrial plants, or 75%, the 
 annual waste is $200,000,000. 
 
 "SUMMARY 
 
 . Efficiency 
 
 Amount per cent. Waste 
 
 Materials 100 
 
 Supplies $ 500,000,000 70 $150,000,000 
 
 Personal Service 1,000,000,000 70 300,000,000 
 
 Fixed charges 800,000,000 75 200,000,000 
 
 "As to each one of these aggregates, the reasons for and the 
 extent of the losses can be ascertained item by item. 
 
 "Neither the comparative nor the actual amount of waste
 
 70 THE PRICE OF INEFFICIENCY 
 
 is essential to the discussion; the problems, diagnosis and the 
 cure are the same, whether 20% or 2% of the population is 
 dying of the bubonic plague; the problems of diagnosis and 
 remedy are the same whether the railroads are more wasteful 
 or less wasteful than industrial plants, whether the annual pre- 
 ventable waste is $700,000,000 or $70,000,000. 
 
 "Railroad wastes are like hygienic wastes. The latter are 
 due to a great variety of causes — inheritance, unhygienic loca- 
 tion, avocations, ignorance, indifference, the pressure of other 
 and more powerful incentives. Norway has reduced its death 
 rate far below that of any civilized country, but first Norway 
 realized the magnitude of the problem and put in a generation 
 striving for its ideals. 
 
 "Railroad wastes are like agricultural wastes. 
 
 "Germany in twenty-five years has increased her output of 
 staples per acre under cultivation between 30 and 40%. Ger- 
 many to-day averages per acre 100% more than is realized in 
 the United States. The German agricultural society has been 
 busy for twenty-five years. 
 
 "When the whole country, governments, investors, executives, 
 workers, patrons, committees, wake up to the fact that pre- 
 ventable railroad wastes aggregate more than two million dol- 
 lars for every working day, that half of this loss could be rather 
 easily eliminated, certainly as easy as the increase per acre and 
 more easily than the lengthening of life in Norway; when it is 
 realized that the cost of effecting loss elimination need not ex- 
 ceed 57o of the saving; when it is realized that the two mil- 
 lion dollar a day gain will be inevitably distributed to those who 
 do railroad work, to those who furnish money and to those who 
 supply railroad traffic, then, and not before, will the great 
 problem be taken up seriously."
 
 CHAPTER VII 
 PEIVATE MONOPOLY 
 
 The goal of commerce — Origin of monopolies — ^The end of competition — 
 The great commercial triangle — The tyranny of the single seller — 
 Gigantic growth of American monopolies — The monopolistic parasite — 
 The point of saturation — The legal trick that made the trusts — ^The 
 two great camps of capitalism — Sympathetic control and its menace — • 
 The total wealth of the United States — The aggrandizement of the 
 larger groups — Inevitable absorption of small business units — Diges- 
 tion of securities — Enormous capital controlled in New York — Con- 
 centration of wealth — Despotic possibilities of aggregations of wealth 
 — The dollar vs. the flag — The desperate problem of America to-day — 
 The money king of the future, now an infant in arms or a child at 
 play? 
 
 Monopoly is the effort of the individual, the group or the 
 government to profit at the expense of the public. The state 
 may at will create for itself various monopolies and monopolies 
 have often great beneficial effects. 
 
 The post office is a government monopoly, the power to issue 
 money and collect taxes are similarly government monopolies. 
 Some governments by engaging in commerce make sufficient 
 profits so that there is no taxation, thus dispensing with that 
 monopoly. 
 
 In previous times governmental monopolies were much more 
 frequently granted by the crown to individuals than utilized by 
 the governments themselves. At present, the principal monop- 
 olies granted to individuals by governments are those of patents 
 and copyrights. 
 
 Partial monopolies take the form of tariff in the interests of 
 certain classes of protected industries. 
 
 Competition is lauded as the desirable condition, and mo- 
 nopoly comes in for general condemnation, but in reality 
 monopoly and competition are different ends of the same stick, 
 for the whole effort of competition is to achieve monopoly. 
 
 There are three or more parties to a commercial transaction, 
 normally, the rival sellers and the buyer. The buyer encour- 
 
 71
 
 72 THE PEICE OF INEFFICIENCY 
 
 ages competition in his own interest, but when out of the strug^ 
 gle, one seller emerges triumphant, the buyer is largely at his 
 mercy. The seller has reached the goal of monopoly, and the 
 buyer while applauding the process as long as it remains in the 
 stage of competition, is by no means enthusiastic over the out- 
 come. 
 
 The United States, after a century and a third of competi- 
 tion, has reached the stage where competition has run its course. 
 The process is at an end, the single seller holds the field and 
 the buyer is vastly disturbed, in fact is being robbed right and 
 left by all sorts of single sellers of everything he needs to 
 buy. 
 
 Two courses must be pursued, either competition must be 
 restored and artificially fostered, or the buyer must take the 
 socialistic step of permitting the one seller to continue but of 
 regulating the price. All that competition can do is to regulate 
 the price so that however this is achieved, it would seem to be 
 the same in the end to the buyer, while as for monopoly, it is 
 evident that the price must be regulated in one way or another, 
 and governmental price regulation is rather sought by the mo- 
 nopoly, possibly because of the prospect of being able to regu- 
 late the government later on. 
 
 The price, while all important to the buyer, is not as impor- 
 tant to monopoly as its continuance as the only seller. 
 
 At present the United States is in a turmoil. The customs 
 and usages of commerce for centuries have come to an end. 
 Monopoly has suddenly assumed gigantic proportions. The old 
 worm-eaten edifice of competition has been undermined, por- 
 tions have collapsed, and a state of panic exists, with a thousand 
 leaders leading in a thousand different vortexes. 
 
 Groups are for rehabilitation of competition, others for regu- 
 lation of monopoly, others for a policy of inertia and others 
 have each their own schemes to an endless number. The mo- 
 nopolies in control of the situation continue to grow in power 
 but fear the day of reckoning. Like swollen parasites, the 
 monopolies cover the body of the victim with but two results in 
 view: the exhaustion of the supply of blood or the point of 
 monopolistic saturation, the moment when the endurance of the 
 victim ceases and the parasite is shaken off at whatever cost. 
 
 America shows signs of shaking the monopolies off, but the 
 process is one that will be painful if not impossible.
 
 PRIVATE MONOPOLY 73 
 
 The extent to which privately controlled combinations of cap- 
 ital have grown in America is a social phenomenon never before 
 observed in the history of the world. 
 
 It has been largely if not wholly made possible by the com- 
 mercial contrivance of the corporation, the association of indi- 
 viduals free from risk other than the amount of their investment 
 in the corporation. It is safe to say that corporations if they 
 had never been authorized by the laws of the various states to 
 own stock in other corporations, could never have reached the 
 importance they now assume. Even if the freedom from addi- 
 tional liability of stockholders had not been granted, the present 
 conditions could not have arisen. 
 
 Especially rapid has been the growth of masses of capital 
 since the former privilege was granted, a condition dating back 
 less than a generation. 
 
 The states, by abolishing corporations, or by striking out the 
 privilege of owning stock in other corporations or the freedom 
 from individual liability of the stockholders, could, almost at a 
 blow, stop further accumulations and initiate a policy which 
 will work towards the reestablishment of the old order of com- 
 petition. 
 
 The inability of the states to revise the charters of corpora- 
 tions is also a bar to regulating conditions. It was originally 
 assumed that the states could rescind powers granted corpora- 
 tions taking out charters, but a decision of the Supreme Court 
 in the Dartmouth college case two or three generations ago, 
 decided on a very narrow margin in the court, has caused more 
 damage to the country than perhaps any other decision ever 
 rendered by the court. 
 
 Will the states take action against corporations; will compe- 
 tition be restored or will monopoly be continued? It is for 
 the public to decide. 
 
 The extent of the accumulation of capital in a few hands is 
 seen by the following table, by John Moody, the noted financial 
 statistician and writer in McClure's Magazine. 
 
 It represents the control of two groups of capitalists, and 
 their followers : the Morgan group and the Standard Oil group. 
 The percentages, where not otherwise indicated, are calculated 
 from the figures of capitalization appearing in Poor's and 
 Moody's Manuals.
 
 74 THE PRICE OF INEFFICIENCY 
 
 PERCENTAGES OF INDUSTRIES AND RESOURCES CONTROLLED. 
 
 Central Group Alliances Outside 
 
 Railroads 61 25 14 
 
 Express and Pullman 93J . . 6| 
 
 Anthracite Coal (supply owned) 88 J 6J 5 
 
 Steel 82 5 13 
 
 Cement (output) S'3| . . 66f 
 
 Petroleum (output handled) 67 18 15 
 
 Lead (output) 60 40 
 
 Copper (output) 60 40 
 
 Telephone 74 . . 26 
 
 "This table gives a general idea of the control that these 
 groups and their allies have gained in certain specified indus- 
 tries, while only a rough and only a partial statement. The 
 control of these men has gone everywhere that it is possible to 
 create a practical working monopoly of any kind. Steamship 
 lines, cracker-baking, the manufacture of farm machinery; these 
 and many other industries as widely varied have been com- 
 bined into the so-called "trusts" controlled by them. And 
 the list is always extending. ' ' 
 
 The vast amount of capital that is controlled in these indus- 
 tries is indicated by an estimate prepared by Mr. Moody: 
 
 "Outside of small, close business corporations, owned by in- 
 dividuals, the total corporate capitalization in par value in the 
 United States at present is not over $43,000,000,000. The 
 wealth of the United States, according to last reports, was in 
 the neighborhood of $110,000,000,000, of which about 50% was 
 represented by realty values, the balance being tangible prop- 
 erty of thousands of different kinds. So that we see, after all, 
 that the trend towards concentration in corporate control has 
 now extended so far that approximately 80% of all the vital 
 corporate capital of the country is under the domination or con- 
 trol of this powerful group of Wall Street interests which we 
 have referred to. . . ." 
 
 From this it will be seen that probably $35,000,000,000 of 
 capital is concentrated, if not in the direct physical control of 
 men of this group, yet in such disposition as to be sympathet- 
 ically under their dominance. Any movement which they 
 initiate will be followed by the momentum of that much capital, 
 and in opposition will only be found a much smaller amount of 
 capital, in diversified control, acting at haphazard and in com- 
 petition. The large bodies of capital being directed as units
 
 PRIVATE MONOPOLY 
 
 75 
 
 by men of greater experience and power, must inevitably swal- 
 low up the smaller units. 
 
 Wliat proportion their control amounts to of the whole wealth 
 of the country can be seen from the following table: 
 
 According to a Special Report of the Census Office, 1907, the 
 Estimate of National Wealth is: 
 
 Form of Wealth 
 
 Total $107,104,192,410 
 
 1904 
 
 Real property and improvements taxed 
 Real property and improvements ex- 
 empt 
 
 Live stock 
 
 Farm implements and machinery 
 
 Manufacturing machinery, tools and 
 
 implements 
 
 Gold and silver coin and bullion 
 
 Railroads and their equipment 
 
 Street railways, etc. 
 
 Street railways 
 
 Telegraph systems 
 
 Telephone systems 
 
 Pullman and private cars 
 
 Shipping and canals 
 
 Privately owned waterworks 
 
 Privately owned central electric light 
 
 and power stations 
 
 All other: 
 
 Agricultural products 
 
 Manufactured products 
 
 Imported merchandise 
 
 Mining products 
 
 Clothing and personal adornments 
 
 Furniture, 
 property 
 
 and kindred 
 
 55,510,228,057 
 
 6,831,244,570 
 
 4,073,791,736 
 
 844,989,863 
 
 3,297,754,180 
 
 1,998,603,303 
 
 11,244,752,000 
 
 2,219,966,000 
 227,400,000 
 585,840,000 
 123,000,000 
 846,480,804 
 275,000,000 
 
 562,851,105 
 
 1,899,379,652 
 
 7,409,291,668 
 
 495,543,685 
 
 408,066,787 
 
 2,500,000,000 
 
 5,750,000,000 
 
 1900 
 
 $88,517,306,775 
 
 46,324,839,234 
 
 6.212,788,930 
 
 3,306,473,278 
 
 749,775,970 
 
 2,541,046,639 
 1,677,379,825 
 9,035,732,000 
 
 1,576,197,160 
 211,650,000 
 400,324,000 
 98,836,600 
 537,849,478 
 267,752,468 
 
 402,618,653 
 
 1,455,069,323 
 
 6,087,151,108 
 
 424,970,592 
 
 326,851,517 
 
 2,000,000,000 
 
 4,880,000,000 
 
 The enormous degree of control exercised by the groups of 
 Wall Street financiers, directly, and more particularly through 
 sympathetic control, may be understood when the organization 
 of Wall Street is considered. 
 
 In Wall Street are collected a large body of brokers who make 
 it their business to be in touch with all the pereons of means 
 in the United States who have money to invest. 
 
 These brokers have the confidence of their cleints, and when 
 capital is wanted for a new enterprise one of the great finan-
 
 76 THE PRICE OF INEFFICIENCY 
 
 ciers underwrites the issue of stock; that is, he agrees to sell 
 it at a certain price or over, or to buy all that he does not dis- 
 pose of. He receives a certain percentage for thus guaranteeing 
 the sale of the stock, called his underwriting fee. 
 
 He is merely a wholesaler of confidence, because he simply 
 apportions out among the brokers certain amounts of the stock, 
 which they agree to sell to their clients. They also receive a 
 certain percentage. Thus they participate in the underwrit- 
 ing. They are the retailers of the stock, the great financier 
 being the wholesaler of the whole amount. 
 
 The prestige of the financier and the confidence which the 
 clients have in the brokers, results in the prompt sale of the 
 stock with a large profit to all concerned ; and the new body of 
 capital put into the new enterprise, though the stock is owned 
 by scattered holders, is yet sympathetically controlled by the 
 financier, as the brokers will advise their clients to vote the 
 stock as the financier wishes. This they invariably do, for the 
 financier has retained a large block of the stock, as have the 
 original promotors of the company, and the small holders feel 
 that they will manage the company in its best interests on ac- 
 count of their holdings. 
 
 The capital, however, which has thus been withdrawn from 
 all parts of the country, to form a new trust which operates 
 in all parts of the country, but which is controlled in New York, 
 buys out or destroys local concerns, which, if the trust had not 
 been formed, would have continued to prosper and been 
 strengthened by the local capital going directly into them in- 
 stead of going to New York to be partially absorbed by the 
 brokers in process. Monopoly thus takes the place of competi- 
 tion. 
 
 And the great financiers keep a close watch on the financial 
 pulse of the public, new corporations being formed or the cap- 
 ital of old ones increased rapidly enough to keep absorbed as 
 much as possible of the new wealth coming into existence 
 throughout the country. 
 
 The central group of capitalists, too, have great power 
 through the control of the savings and profits of the various 
 companies they control, only a part of which goes out in divi- 
 dends. What this amounts to is seen from the following table, 
 taken from figures given in Poor's Manual and published in 
 McClure's Magazine.
 
 PRIVATE MONOPOLY 77 
 
 CASH HOLDINGS OF KAILROAD AND INDUSTRIES UNDER NEW YORK 
 
 CONTROL. 
 
 Railroad Large Industrials Total 
 
 1880 $ 11,281,626 $ 11,281,626 
 
 1890 51,872,152 $17,468,090 69,340,242 
 
 1900 160,561,81 1 46,536,909 207,098,720 
 
 1909-10 640,545,178 267,337,175 907,882,353 
 
 "The larger part of this money lies in the control of the men 
 whose great monopolies have grown to overshadow all the rest. 
 Together with it, they hold in absolute ownership individual 
 fortunes of their own, running from fifty to four hundred mil- 
 lion dollars, and the alliance with the fortunes and resources 
 of the many lesser men — their associates and dependents. 
 This money power completes their control over the corporate 
 capital of the country — invested and uninvested. They own, 
 together or apart, a controlling stock interest in the dominating 
 industries of the country; they hold control, through these and 
 other means, of industry as a whole; and, finally, they hold 
 control of the capital which is yet to be spent for the use of 
 the great corporate enterprises of the United States." 
 
 "While the stock of these corporations is distributed to a cer- 
 tain extent, it is only among the wealthy class of the population 
 of the United States. This is shown by the fact that the stock 
 for the most part, is in shares of $100 par value, while the 
 bonds are in units of $1,000. If the stock were widely dis- 
 tributed among the general public, there would be a class of 
 brokers dealing in small lots of stock from one to five, ten and 
 fifty shares. In the parlance of Wall Street, anything less 
 than 100 shares or $10,000 par value of stock, is called an "odd 
 lot." Certain brokers on the Stock Exchange make a specialty 
 of odd lot business, but the number of brokers who are special- 
 ists of this kind is very limited, an almost negligible proportion 
 of the whole membership, the great majority of brokers dealing 
 only in blocks of 100 shares, though they purchase for clients 
 odd lots when requested. Speculation on margin is almost 
 wholly in the 100 share lots and over, though there is a smaller 
 exchange which trails along after the big one, in which specula- 
 tion in 10 share lots on margin is carried on to a limited extent. 
 
 What is called the general public, that is the small investor 
 who has $1,000 or less to invest, usually buys a mining stock 
 of $1 par value, in preference to the securities of the great cor- 
 porations.
 
 78 THE PRICE OF INEFFICIENCY 
 
 A further proof of the concentration of wealth lies in the 
 fact that a close estimate of the whole number of stockholders 
 in the principal corporations is hardly more than 600,000, of 
 which somewhat less than half hold railroad stock, while a large 
 proportion, owning stock in several different corporations are 
 counted more than once in such a summary. 
 
 According to the wealth statistics of the tenth census, 3% of 
 the American people own 20% of the wealth, 9% own 51% 
 of the wealth while 88% of the people own but 29% of the 
 wealth. 
 
 In Germany, however, only 2% of the wealth is held by the 
 wealthier classes while 54% is held by the middle and 44% by 
 the lower classes. 
 
 AVhat the concentration of wealth in the United States means 
 is seen when the total national wealth of the two countries is 
 compared. That of Germany is 45,000 millions of dollars and 
 that of the United States, as shown, 107,000 millions of dol- 
 lars. 
 
 The vast accumulation of wealth thus in a few hands takes 
 on a new significance when its international effects are consid- 
 ered. 
 
 Dr. Franz Ehrich Junge-Hermsdorf, in the Engineering Mag- 
 azine, has presented this phase of the question most admirably: 
 "If we admit that capital in its lesser accumulation has been 
 and is conducive to national progress — progress which must in- 
 clude, besides the physical and intellectual, also the moral up- 
 lift of man — why does it become dangerous and tyrannical 
 and harmful to the country when concentrated in a few irre- 
 sponsible hands? 
 
 "There can be no doubt that capital and capitalism, based as 
 it is on the institution of private property, has done an enor- 
 mous lot of good to the commonwealth, as long as it concen- 
 trated its activities within the national borders, serving to mul- 
 tiply the values of the native soil. But when capital started to 
 flow bej^ond the borders of its natural vessel — where it can be 
 cheeked by competent authority, and where righteous govern- 
 ments can direct its course to the best ends of all — and when 
 it started to combine with other streams of overflowing wealth 
 from other countries, capital became a wild torrent of formid- 
 able force, an international power, whose movements are fever- 
 ish and uncertain and can no longer be guided by established 
 national authorities. Nor are they balanced by weight of inter-
 
 PRIVATE MONOPOLY 79 
 
 national agreement, because there is no arbitrary power strong 
 enough to enforce conciliatory measures, and none elevated 
 enough to enjoy general recognition. International capital is 
 its own arbiter, it is responsible to no one, and its supreme lex 
 is to grow and multiply, ignoring sentimental considerations. 
 
 ''Says William Howard Taft: 'A gigantic controversy be- 
 tween capital and labor ^^'ill decide once for all how capital 
 and labor shall share the joint profits which they create.' 
 From our analysis of the situation, it will be more a fight be- 
 tw»een the legitimate power of national governments, repre- 
 senting the interests of the masses, and the arrogated power of 
 international capital, representing the interests of the favored 
 few. 
 
 "There is, indeed, a closer affinity of aims, a firmer alliance 
 of action, traceable to-day, between the great industrial trusts 
 of the different countries, preying jointly upon the world's 
 markets, than there is co-operation existing between various 
 social strata of one and the same country. The world is be- 
 coming an open shop, owned by the international association of 
 manufacturers. National borders disappear, and with them all 
 the loftiest motives for which they stood. 
 
 "But it is not only the subjugation of national ideals to in- 
 ternational aims that is so much to be feared, but the fact that 
 a small group of selfish men is able to swing, not only the fac- 
 tor of capital, but also the factor of government, setting up 
 nation against nation, and hearthstone against hearthstone. 
 
 "Here is an illustration of this disastrous tendency as it 
 exliibits itself in the commercial dealings of this very day. A 
 small group of American capitalists, known under the name 
 of the 'North Trust,' attempted in times of disorganization of 
 the German market to buy up one of the fundamental re- 
 sources of that country, making private contracts for the supply 
 of 320,000 tons of potash per annum, on five years' option; 
 thereby they could gain control of the American market, where 
 about 360,000 tons are consumed annually, thus establishing a 
 practical monopoly in restraint of trade. 
 
 "And this same trust is attempting, further, to engage and 
 play the American government against the German govern- 
 ment, because the latter has enacted a law (long ago planned 
 and announced to the State department at Washington), which 
 purports by the establishment of a national syndicate, to pre- 
 vent over-production of potash and, for the benefit of the small
 
 80 THE PRICE OF INEFFICIENCY 
 
 producer, prohibits squandering irreplaceable resources, of 
 which Germany has no plethora. 
 
 "It is a most reckless game of concentrated capital, and one 
 which cannot be too severely rejected before the forum of pub- 
 licity—this attempt to endanger and disturb the friendly rela- 
 tions between two great peoples for the sole benefit of establish- 
 ing an artificial monopoly on some such commodity and reaping 
 the excessive profits from its sale. But it is an instance which 
 shows clearly that national communities must not let the con- 
 trol of capital slip from their hands, lest international compli- 
 cations of the gravest consequences arise, for which corporate 
 capital will not and cannot be held responsible. 
 
 "It is the tragedy of our age, the way this artificial creature 
 of capitalism, in its ubiquity, can forever escape the single 
 justice which the natural individual must face. And it is the 
 duty of every patriotic man, within the borders of his country, 
 to see that tlie rule of capital is once for all subjected to the 
 rule of government, viz: to the collective force of civic virtue 
 evolved in centuries of nation building." 
 
 In what ways this is to be accomplished is the great problem 
 of American life to-day, and it is likely to continue the dom- 
 inant problem for many years. It has not arisen in a day. 
 As John Moody and George Kibbe Turner in McClure's Mag- 
 azine say: 
 
 "This central group is a perfectly natural evolution — the 
 final product of thirty or forty years of unchecked movement 
 towards monopoly. It has not been erected by any man's or 
 men's arbitrary acts or theories. It has risen day after day 
 and year after year upon the progressive bankruptcy of gen- 
 eral industry under competition. The old economic axiom has 
 been erased in the last twenty-five years; competition has not 
 been the life of trade ; it has been the death of industry in the 
 United States. Monopoly has been built up on its ruins, and 
 it is built to stay." 
 
 The United States is by no means alone in its struggle against 
 American trusts. The Standard Oil Company, one of its most 
 complete monopolies, has been gradually reaching out for the 
 oil trade of Germany until a most acute situation has arisen. 
 
 Dr. Paul Schwartz, editor of Petroleum, the official organ 
 of the German oil trade, who has for years carried on a crusade 
 against the Standard and who has frequently been consulted 
 by the German government as to the best ways and means of
 
 PRIVATE MONOPOLY 81 
 
 fighting the trusts says in an interview in the New York Times 
 of Oct. 20, 1912 : 
 
 ''The cries of distress which for months have been sent up 
 by our oil trade could no longer be ignored. It was not a ques- 
 tion of the price of oil. There was no complaint from con- 
 sumers on that score. 
 
 "The reason the government has been moved to take the 
 drastic action of establishing a monopoly is that the Standard 
 is throttling the life out of thousands of German citizens, who 
 are deprived of the possibility of longer conducting an inde- 
 pendent, self-respecting business in their own trade. They find 
 themselves reduced to economic serfdom. Men who once had 
 prosperous little oil businesses of their own have now the al- 
 ternative of becoming drivers of the oil wagons owned by the 
 Standard. They are asked to come down from the rank of 
 business men to the level of peddlers. 
 
 "This is the state of affairs to which the Standard's highly 
 organized campaign has reduced our oil trade. Their so-called 
 can business has been developed to a point where they reach 
 practically every individual consumer at his own threshold. 
 
 "By a system of speeding up the local representatives 
 through its offers of premiums, the Standard has spread its nets 
 so thoroughly that no competition can any longer stand against 
 
 it. 
 
 "The Standard has taken the map of Germany and staked 
 the entire empire out as its own particular claim. No hamlet 
 is too small to merit the octopus's attention. The result has 
 inevitably been the destruction of the small dealer. 
 
 "Although itself the classic land of organization, Germany is 
 not accustomed to such methods in the pursuit of business. 
 This sort of Americanization is offensive to our ethical suscep- 
 tibilities, quite apart from the economic ruin it brings to thou- 
 sands. 
 
 "Our people and government have for years been bom- 
 barded from all quarters for remedial measures. It had no 
 longer any recourse but to proceed by the furthest-reaching 
 means at its command to rid the country of a system, which 
 was eating the heart of the economic body. 
 
 The future development of monopoly and accumulated cap- 
 ital is an ominous question. Not only in the mere power of 
 capital lies the danger, but in its vast psychological effect, the 
 sharp contrast between the citizen of smaU or average means,
 
 82 THE PRICE OF INEFFICIENCY 
 
 and the wealth of the rich, places a gulf between them, creating 
 class distinctions and antagonisms which are fatal to the spirit 
 of democracy. 
 
 The possibility will be present of a financial genius arising, 
 a Napoleon of finance, and merging under a single control all 
 this vast capital. Such a man would wield a power never be- 
 fore exercised. He could make or unmake legislators, judges, 
 presidents; he could unite countries into new nations or dis- 
 I'upt political divisions, and if allied to his genius for money, 
 he had genius for politics and ambitions for power, he might 
 even become a dictator, the first sole ruler of the modern world. 
 While such a possibility is remote, yet America has taken gi- 
 gantic strides in the century and a third of its existence, and 
 it is not beyond the probabilities that another century may 
 bring such a problem up ; that even now, the coming money king 
 may be an infant in arms or a child at play. 
 
 Such a contingency would be impossible did the texture and 
 composition of the American people remain of its present qual- 
 ity; but such a continuance is, however, gravely in hazard. 
 The last decade or two has witnessed a serious impairment of 
 American standards due to the hordes of a new immigration, 
 and should this continue unchecked and unassimilated, a cen- 
 tury would see America dominated by a people of characteris- 
 tics so different from our own as to be unable or disinclined to 
 preserve the bulwarks of liberty erected with such sacrifices 
 by your ancestors. As will be pointed out in later chapters, in 
 relative standing with other countries the United States is far 
 from holding the position it held twenty years ago. It is con- 
 stantly losing ground, the poor getting poorer, the rich getting 
 richer, and the middle class disappearing, and unless the proc- 
 ess is arrested, American institutions as we know them wiU 
 pass into history.
 
 CHAPTER VIII 
 GOVERNMENTAL SOCIALISM 
 
 The tyranny of the single seller — How inventions multiply the earth's 
 population — Consolidated robbery — Rapacity of modern combinations 
 — The logic of governmental price regulation — An embryonic function 
 — What governments are really for — Public and private functions of 
 governments — What governments cost and what they do for the money 
 — 'The Interstate Commerce Commission — Its effective methods — Rail- 
 roads no longer the pawns of business — Status of governmental price 
 regulation — The hazardous step of governmental ownership — Govern- 
 mental socialism as an economic necessity — Growing powers of public 
 service commissions — Government by executive order — Qualitative reg- 
 ulation of food products — Success of experiments in governmental 
 socialism — Where enliglitened self-interest breaks down — Cicero on 
 socialism — What socialism is — What it proposes to do — Elimination 
 of the middleman or the cost of selling — How competition oppresses 
 the worker. 
 
 In earlier times and under simpler conditions of life, com- 
 petition was the only safeguard which the purchaser needed, 
 but under the complex regime of modern life, the limitations 
 of competition have been exceeded, and the purchaser has fallen 
 a victim to the ravaging self-interest of the sole seller. 
 
 The new condition has been created by invention, not by any 
 change in human nature. The activity of inventors, due to the 
 establishment of patent offices and the recognition of their rights 
 to their inventions for limited terms, has done more to revo- 
 lutionize the world than any other single factor. 
 
 The invention of the harvesting machine made bread vastly 
 cheaper, with the result that the population of the world in- 
 creased far beyond what would have been possible with previous 
 expensive methods of wheat harvesting. 
 
 Every invention which saves time has the effect, sooner or 
 
 later, of increasing the population of the world, and in addition 
 
 of increasing the comfort of its inhabitants. Once the majority 
 
 of people went barefooted a greater part of the year. Now, 
 
 through perfections of shoe making machinery, shoes have come 
 
 to be so cheap that everyone wears them the whole year around. 
 
 83
 
 84 THE PRICE OF INEFFICIENCY 
 
 The invention of the steam locomotive so reduced the cost of 
 transportation that journeys thousands of miles may be taken 
 where hundreds were traversed before. 
 
 But while invention has bestowed benefits, it has involved 
 consequences. Where formerly several stage coach drivers were 
 in competition over the same road, there is now one road of steel. 
 The stage coach has become an impossibility and competition 
 likewise an impossibility. In effect, the stage coach proprietors 
 sold their coachs and built a railroad. One became the engineer, 
 one the fireman, one the conductor, one the station agent, and 
 collectively they carried more passengers than they could have 
 done in competition. 
 
 They waxed so rich in fact, that they all became officers of the 
 company and hired employees to do their former tasks. Where 
 once there had been competition, the invention of the steam 
 railway brought about monopoly, with all the factors working 
 together against the purchaser of transportation, that had once 
 been in competition. 
 
 The self interest of the proprietors of the railroad had nothing 
 to check it. For generations they charged "all that the traffic 
 would bear," and kept up a clamor about the benefits of private 
 ownership and the sacred benefits of competition. 
 
 Only within recent years has the public realized, and acted 
 on the realization, that where competition has been eliminated 
 some other form of regulation must be supplied. The public 
 must travel, must buy transportation and yet there is no divine 
 right given to the proprietors to charge "all the traffic will 
 bear." 
 
 It is impracticable and impossible for the individual to supply 
 the regulation necessary. But the individual, in his collective 
 capacity, a government, has just as much right to refuse to pay 
 "all the traffic will bear" as the proprietors in their collective 
 capacity as the company have to demand it. 
 
 Governmental regulation is thus the first and logical step after 
 the boundaries of competition are passed. It is not necessary 
 that the individuals as a government should purchase the rail- 
 road. Their whole desire is transportation at fair rates. Com- 
 pared with governmental regulation, governmental ownership 
 is a revolutionary step. 
 
 Beyond competition, however, a choice must be made, the ra- 
 pacity of self interest must be cheeked, and it has been found 
 that the choice of governmental regulation is thus in theory not
 
 GOYERNIMENTAL SOCIALISM 85 
 
 only the best expedient, but that in practice it works out better 
 than anything that has been attempted. 
 
 The regulation of price, however, is a governmental function 
 that has never been employed to any great extent as yet. For 
 some reason there appears to be considerable public sentiment 
 in opposition to it. It is practically an unused power of the 
 government, yet when exercised it affects the individual no more 
 directly than various other governmental activities. 
 
 In classifying the activities and transactions of a nation, state 
 or municipality, students of economics divide them into two 
 different types; general functions and commercial functions, a 
 classification adopted by the Federal census, which in a special 
 report analyses the governmental functions in a most interesting 
 manner, as follows: 
 
 "The general functions of nation, state and municipality are 
 those which are, as a rule, performed for all citizens alike, with- 
 out any attempt to measure the benefit conferred or the exact 
 compensation therefor, the expenses being met by revenue ob- 
 tained principally from compulsory contributions levied without 
 regard to the benefit which the individual contributor may de- 
 rive from any or all governmental activities. 
 
 * ' Most functions of this class are essential to the existence and 
 development of government and to the performance of the gov- 
 ernmental duty of protecting life and property and of main- 
 taining a high standard of social efficiency. 
 
 "Chief among those activities are those of general govern- 
 ment; the protection of life, health and property; the care of 
 the defective, delinquent and dependent classes; the education 
 of the young, and the perfonnance of other duties of a similar 
 nature; the purchase of land for government buildings, parks 
 and streets; the erection, equipment and management of state 
 capitols, country courthouses, city halls and other buildings for 
 general governmental uses ; the purchase or construction of elec- 
 tric light and gas works for the exclusive purpose of lighting 
 the streets and governmental buildings, and of other structures 
 and plants, such as printing offices, police and fire telephone 
 systems and bridges; for furnishing free of charge any com- 
 modity or service required by the government in the common 
 interest of all its citizens. In the same categoiy are included 
 the opening, grading, paving and curbing of streets, and the 
 construction of drains and sewers, where such public improve- 
 ments are made at public expense without conferring upon par-
 
 86 THE PRICE OF INEFFICIENCY 
 
 ticular individuals measurable special benefits for which, in the 
 opinion of the proper authorities, compensation should be ex- 
 acted by the government. To the same general group belong 
 the making and paying of loans and the payment of interest 
 thereon, where such loans are made in connection with the other 
 activities and transactions mentioned. 
 
 "The general functions of nations, states and municipalities 
 may be classified in a great variety of ways, according to the 
 point of view from Avhich considered. The primary classifica- 
 tion of general functions of municipalities which was adopted 
 by the Bureau of the Census is based upon prior studies 
 of the subject by Prof. Adolph Wagner, of Germany, set forth 
 in his Finanzwissenschaft, and revised by Prof. Frederick E. 
 Clow in the Quarterly Journal of Economics for July, 1896. 
 The earlier treatment of the subject by American economists 
 was ably discussed by Prof. L. S. Rowe of the University of 
 Pennsylvania, before the conference of the National Municipal 
 League in 1899. 
 
 "As a result of these studies and of conferences between 
 accountants, economists and others connected with the National 
 Municipal League, that organization arranged a tentative classi- 
 fication which was made the basis of the one later adopted by 
 the Bureau of the Census. 
 
 "The commercial functions of a state, nation or municipality 
 include those which create trade relations, industrial or semi- 
 industrial, between the nation, state or municipality, and the 
 general public, including other civil divisions. Among the 
 transactions which arise from the exercise of such functions are 
 those involving the loan of public money at interest, the use of 
 public property for compensation, the sale of any commodity 
 or article of commerce or the performance of any work or serv- 
 ice for pay. 
 
 "All these transactions involve the performance of some serv- 
 ice by the national, state or municipal government, or the grant- 
 ing of some favor by such government, for special compensa- 
 tion, whether the favor or service be primarily for this service 
 or favor, or for the revenue to be secured; none of them is es- 
 sential to the existence and development of the government, 
 though they may contribute to its support." 
 
 The regulation of prices charged by monopolies is, strictly 
 speaking, in neither of these classifications. While it is a serv- 
 ice rendered by the government for the benefit of the public,
 
 GOYERmiENTAL SOCIALISM 87 
 
 it is not strictly a general function, as it is not necessary for the 
 development of the government. It may be called, in short, 
 governmental socialism, the stopping of what amounts to a con- 
 spiracy against the people constituting the government, by the 
 government acting in their interest. 
 
 Being an innovation and the exercise of a power not hitherto 
 called into use, it is natural that much opposition should be 
 excited against it, even by those who will be most benefited. 
 
 In the activities which may be included under the term of 
 governmental socialism, the United States has only recently 
 taken part, though the field entered is one of the greatest, and 
 the consequences the most far reaching of any activity of this 
 sort which could be undertaken. 
 
 In the Interstate Commerce Commission, which regulates rail- 
 road freight and passenger rates and even the system of ac- 
 counting of the railroads, in order that regulations may be uni- 
 formly applied, the United States has in successful operation 
 one of the most extensive and practical of all the forms of 
 governmental price regulation. 
 
 The vast savings to the public and the impartial adjustment 
 of traffic and rates has made the Interstate Commerce Com- 
 mission one of the most useful bodies ever created. 
 
 It has remained free from accusations of partiality and graft 
 and enjoys the confidence of the public, the shippers and the 
 railroads. 
 
 Indeed, it has been for the railroads a great benefactor, since 
 it has relieved them of a great deal of grafting to which they 
 were subject in the way of passes and other favors, which it had 
 become customary to grant to persons of influence and large 
 shippers. It has freed the railroads, too, of the necessity of 
 allowing rebates to powerful shippers, and while advances in 
 rates have been vetoed by the commission, the uniformity en- 
 forced has been to the advantage of the railroads as well as to 
 the public. 
 
 Railroads, as railroads, and not as pawns of business, prefer 
 to pay no rebates. Except in cases of competition, which are 
 rare, the railroad is not the initiator of the rebate. It is usually 
 forced to give the rebate by some powerful shipper, who has 
 connections which enable him to dictate his own terms to the 
 railroad. It enforces a condition of equity and justice which 
 is beneficial to all concerned. 
 
 No suggestion is heard of abolishing the commission or even
 
 88 THE PRICE OF INEFFICIENCY 
 
 of curtailing its powers, nor is it called a socialistic body, yet 
 that is what it really is. Its decisions are respected and in im- 
 portant eases are awaited with all the interest which attaches 
 to the decisions of the Supreme Court of the United States. 
 
 George W. Perkins, formerly a partner in the banking firm 
 of J. Pierpont Morgan & Co., and the organizer of the Harvester 
 Trust, a man who started with nothing and who is now many 
 times a millionaire, an energetic, picturesque, breezy and cheer- 
 ful, not to say irrepressible, millionaire is to-day a warm ad- 
 vocate of the idea of a court of commerce to regulate prices 
 charged by trusts, similarly as the Interstate Commerce Com- 
 mission adjusts railroad rates. 
 
 In the World's Work for June, 1911, Mr. Perkins says: 
 
 "Our business concerns have grown from the local firm and 
 the state company to the great interstate corporations ; and what 
 we must have is Federal regulation and control of these great 
 interstate business enterprises, and we must have laws that 
 will punish the man who commits the crime, not the stockholder 
 or the public which is being served. Federal regulation is fea- 
 sible, and if we unite and work for it now, we may be able to 
 secure it; whereas if we continue to fight against it much 
 longer, the incoming tide may sweep the question along either 
 to government ownership or socialism. The day has come when 
 we need statesmanship in business and more business-like states- 
 manship. 
 
 "One important reason why business men have feared regu- 
 lation of business by the government has been that such regu- 
 lation would be performed by inexperienced men — those without 
 business training, who would have no practical knowledge of 
 the great problems involved, 
 
 ""We now have at Washington a Supreme Court, to which 
 is referred the final settlement of our legal questions. This 
 court is composed, of course, of la-wyers only, and it is the 
 dream of every young man who enters the law that he may some 
 day be called to the Supreme Court bench. If such a call comes, 
 it matters not how lucrative his practice, he always drops it for 
 the honor conferred. Why not have a similar goal for our busi- 
 ness men? Why not have a court for business questions, on 
 which no man could sit who had not had a business training, 
 with an honorable record? This would surely come to be re- 
 garded by business men in the same way that the Supreme 
 Court is regarded by lawyers. The supervision of business by
 
 GOVERNMENTAL SOCIALISM 89 
 
 such a body of men, who had reached such a court in such a 
 way, would unquestionably be fair and equitable to business, 
 fair and equitable to the public. Furthermore, it would not 
 take out of business that invaluable asset, individual initiative. 
 It would leave the everyday management of business imtram- 
 meled and allow men free swing to devise ways and means to 
 improve, enlarge and develop our domestic and foreign com- 
 merce." 
 
 What Mr. Perkins suggests as the alternative between social- 
 ism or governmental ownership, is a form of what we term gov- 
 ernmental socialism. 
 
 Another important phase of this activity is seen in the Pub- 
 lic Service Commissions of the various states, and in the spora- 
 dic laws of the various states, regulating the prices of trans- 
 portation. 
 
 The New York State Public Service Commission (there being 
 two, one for the state and the other for the city of New York) 
 is a model for other states. Its functions are the regulations of 
 rates of railroads, street car transportation, their service and 
 improvements, bond and stock issues, and gas, electric and tele- 
 phone matters. It has in addition to the power to regulate 
 rates, very great powers in the supervision of the organization 
 of public service corporations in the issuance of stocks and 
 bonds, and has further remarkable powers in its right to specify 
 the service to be rendered, such as the number of cars to be run, 
 and various other details, which in effect make the state a 
 superior superintendent of operation. Thus the state has by 
 laAV every right and power, practically, that it would have under 
 public ownership, aside from deriving profit from the enter- 
 prise. It prescribes the securities which may be issued, the 
 prices to be charged, and the service to be rendered. No fuller 
 powers could well be asked, although the commission as yet lacks 
 the power to have its orders promptly carried out, and its find- 
 ings are subjected to court review. 
 
 It is argiied that the endowing of Public Service Commissions 
 with such powers is an illegal delegation of the powers of the 
 legislature, which the legislature has not the right to make. It 
 is as though the legislature appointed another body to make 
 laws and then adjourned. It is urged that this is government 
 by executive order, rather than by law, but in spite of these 
 objections, which are more theoretical than real, the operations 
 of the public service commissions are entirely satisfactory to
 
 90 THE PRICE OF INEFFICIENCY 
 
 the public, with the exception that they are not as yet suffici- 
 ently drastic and severe; in short, the criticism is that the 
 powers are not used, not that the powers exist. 
 
 Like the Interstate Commerce Commission, the Public Ser- 
 vice Commissions are not likely to be dispensed with. It is a 
 form of governmental socialism which has come to stay. 
 
 While the government has not as yet attempted the regulation 
 of the rates of anything except public service corporations, it 
 has undertaken what amounts to a price regulation in the pure 
 food and drug laws. The thing regulated is the quality of the 
 product, and while this, in a sense, is a form of protection of 
 the public health, it is also indirectly an important price regu- 
 lation, since in many commodities having a fixed price for a 
 fixed unit, the improvement in quality demanded by the pure 
 food law, is a cheapening of the price and an enforcement of 
 uniformity in price. 
 
 In the provision of the "net contents of container," which, 
 however, has not as yet been adopted, another price regulation, 
 in force abroad, will be adopted, since the marking on the con- 
 tainer of the net weight or amount of the contents will in 
 effect reduce the price by guaranteeing a certain content, while 
 usually the package, with the habitual honesty of the American 
 manufacturer, contains something under the supposed con- 
 tent. 
 
 "While this represents the most that has as yet been done in 
 the United States in governmental socialism, it should be noted 
 that it has been uniformly successful, that vast powers have 
 been exercised for the benefit of the public and with even greater 
 benefit to the corporations than the most "enlightened self-in- 
 terest" that they were previously able to exliibit, and more 
 particularly, that the result has been accomplished without 
 graft and in an expeditious and effective manner. 
 
 Yet the commissioners have been but men, no different from 
 other men. The system, however, is superior to other forms of 
 governmental systems, since the great powers of the commission 
 have caused the members to feel a sense of responsibility to the 
 public, rather than the sense of responsibility to their own 
 pockets so often manifested by aldermen. The intense scrutiny 
 to which their acts are subjected, and the prestige of their posi- 
 tions have rendered this form of governmental activity one from 
 which the best results have been achieved. 
 
 So efficient, indeed, has the commission form of government
 
 GOVERNMENTAL SOCIALISM 91 
 
 been found, that it is being adopted by various cities through- 
 out the United States and is proving one of the greatest politi- 
 cal movements of the century. A further reference is made 
 to it in a later chapter. Socialism is a mantle which is ascribed 
 to a diversified throng of wearers. It does duty for a vast 
 number of isms, and many arise to proclaim its meaning. To 
 one man it means one thing, to another another, but for all, 
 it is at once a protest and a panacea. 
 
 Cicero described what socialism really is, better perhaps than 
 any modern expounder when he said : 
 
 ' ' One thing ought to be aimed at by all men ; that the interest 
 of each individually, and of all collectively, should be the same ; 
 for if each should grasp at his individual interest, all human 
 society will be dissolved." 
 
 Socialism should be a condition which answers Cicero's in- 
 junction. 
 
 Sir Thomas IMore also clearly described modern conditions, 
 the only cure for which socialism claims to be. 
 
 Robert Blatchford in his famous book on socialism, ''Merrie 
 England," a book which has had an enormous sale and which 
 merits the attention of every thoughtful reader, has prefaced 
 his chapter on "Socialism" with the quotation from Cicero and 
 with Sir Thomas More's prophecy, the latter of which is as 
 follows : 
 
 "When I balance all these things in my thoughts, I grow 
 more favorable to Plato, and do not wonder that he resolved not 
 to make any laws for such as would not submit to a community 
 of all things! for so wise a man could not but foresee that the 
 setting all upon a level was the only way to make a nation 
 happy, which cannot be obtained so long as there is property ; 
 for when every man draws to himself all that he can compass 
 by one title or another, it must needs follow that how plentiful 
 soever a nation may be, yet a few dividing the wealth of it 
 among themselves, the rest must fall into indigence. So that 
 there will be two sorts of people among them who deserve that 
 their fortunes should be interchanged, the former useless but 
 wicked and ravenous, and the latter, who by their constant 
 industry serve the public more than themselves, sincere and 
 modest men. From whence I am persuaded that till property 
 is taken away there can be no equitable or just distribution of 
 things, nor can the world be happily governed; for, so long as 
 that is maintained, the greatest and the far best part of man-
 
 92 THE PRICE OF INEFFICIENCY 
 
 kind will be still oppressed with a load of cares and anxieties." 
 
 Mr. Blatchford continues in part, describing socialism: 
 
 "Before I tell you what socialism is, I must tell you what 
 socialism is not. For half our time as champions of socialism 
 is wasted in denials of false descriptions of socialism; and to a 
 large extent, the anger, the ridicule, and the argument of the 
 opponents of socialism are hurled against a socialism which has 
 no existence except in their own heated minds. 
 
 "Socialism does not consist in violently seizing upon the 
 property of the rich and sharing it among the poor. 
 
 "Socialists do not propose, by a single act of parliament, or 
 by a sudden revolution, to put all men on an equality, and com- 
 pel them to remain so. Socialism is not a wild dream of a 
 happy land, where the apples will drop off the trees into our 
 open mouths, and the fish come out of the rivers and fry them- 
 selves for dinner, and the looms turn out ready made suits of 
 velvet with golden buttons without the trouble of coaling the 
 engine. Neither is it a dream of a nation of stained glass 
 angels, who never say damn, who always love their neighbors 
 better than themselves, and who never need to work unless 
 they wish to. 
 
 " No, socialism is none of these. It is a scientific scheme of 
 national government, entirely wise, just and practical. And 
 now let us see. 
 
 "For convenience sake, socialism is generally divided into 
 two kinds. These are called — 1. Practical Socialism. 2. Ideal 
 Socialism. 
 
 "Really, they are only part of one whole; practical socialism 
 being a kind of preliminary step toward ideal socialism, so 
 that we might with more reason call them elementary and ad- 
 vanced socialism. 
 
 "I am an ideal socialist, and desire to have the whole social- 
 istic programme carried out. 
 
 "Practical socialism is so simple that a child may understand 
 it. It is a kind of national scheme of co-operation, managed by 
 the state. Its programme consists, essentially, of one demand — 
 that the land and other instruments of production shall be the 
 common property of the people, and shall be used and managed 
 by the people for the people. 
 
 "Make the land and all the instruments of production state 
 property; put all farms, mines, mills, ships, railways and shops 
 under state control, as you have already put the postal and
 
 GOVERN^IENTAL SOCIALISM 93 
 
 telegraphic service under state control, and practical socialism 
 is accomplished. 
 
 "The postal and telegraphic service is the standing proof of 
 the capacity of the state to manage the public business with 
 economy and success. 
 
 ' ' That which has been done with the post offices may be done 
 with mines, trams, railways and factories. 
 
 "The difference between socialism and the state of things 
 now in existence will now be plain to you. 
 
 "At present the land — that is, England— does not belong to 
 the people — to the English — but to a few rich men. The mines, 
 mills, ships, shops, canals, railways, houses, docks, harbors and 
 machinery do not belong to the people, but to a few rich men. 
 "Therefore the land, the factories the railways, ships, and 
 machinery are not now used for the general good of the people, 
 but are used to make wealth for the few rich men who own 
 them. 
 
 "Socialists say that this arrangement is unjust and unwise, 
 that it entails waste as well as misery, and that it would be 
 better for all, even for the rich, that the land and other instru- 
 ments of production should become the property of the state, 
 just as the post office and the telegraphs have become the prop- 
 erty of the state. 
 
 "Socialists demand that the state shall manage the railways 
 and the mines and the mills, just as it now manages the post 
 offices and the telegraphs. 
 
 "Socialists declare that if it is wicked and foolish and im- 
 possible for the state to manage the factories, mines, and rail- 
 ways, then it is wicked and foolish and impossible for the state 
 to manage the telegraphs. 
 
 "Socialists declare that as the state carries the people's let- 
 ters and telegrams more cheaply and more efficiently than they 
 were carried by private enterprise, so it could grow com and 
 weave cloth and work the railway systems more cheaply and 
 more efficiently than they are now worked by private enter- 
 prise. 
 
 "Socialists declare that as our government now makes food 
 and clothing and arms and accouterments for the army and 
 navy and police, so it could make them for the people. 
 
 "Socialists declare that as many corporations make gas, pro- 
 vide and manage the water-supply, look after the paving and 
 lighting and cleansing of the streets, and often do a good deal
 
 94 THE PRICE OF INEFFICIENCY 
 
 of building and farming, so there is no reason why they should 
 not get coal and spin yarn and make boots and bread for the 
 people. 
 
 ** Socialists point out that if all the industries of the nation 
 were under state control, all the profit, which now goes into the 
 hands of a few idle men, would go into the coffers of the state — 
 which means that the people would enjoy the benefits of all the 
 wealth they create. 
 
 ''This, then, is the basis of socialism — that England should 
 be owned by the English and managed for the benefit of the 
 English, instead of being owned by a few rich idlers and mis- 
 managed by them for the benefit of themselves. 
 
 ''But socialism means more than the mere transference of 
 the wealth of the nation to the nation. 
 
 "Socialism would not endure competition. "Where it found 
 two factories engaged in under-cutting each other at the price 
 of long hours and low wages to the workers, it would step in 
 and fuse the two concerns into one, save an immense sum in 
 cost of working, and finally produce more goods and better 
 goods at a lower figure than were produced before. 
 
 "But practical socialism would do more than that. It would 
 educate the people. It would provide them cheap and pure 
 food. It would extend and elevate the means of study and 
 amusement. It would foster literature and science and art. It 
 would encourage and reward genius and industry. It would 
 abolish sweating and jerry work. It would demolish the slums 
 and erect good and handsome dwellings. It would compel all 
 men to do some kind of useful work. It would recreate and 
 nourish the craftsman's pride in his craft. It would protect 
 women and children. It would raise the standard of health and 
 morality ; and it would take the sting out of pauperism by pay- 
 ing pensions to honest workers no longer able to work. 
 
 "^V^ly nationalize the land and instruments of production? 
 To save waste, to save panics; to avert trade depressions, 
 famines, strikes and congestion of industrial centers; and to 
 prevent greedy and unscrupulous sharpers from enriching 
 themselves at the cost of the national wealth, health and pros- 
 perity. In short, to replace anarchy and war by law and order. 
 To keep the wolves out of the fold, to tend and fertilize the 
 field of labor instead of allowing the wheat to be strangled by 
 the tares, and to regulate wisely the distribution of seed corn 
 of industry so that it might no longer be scattered broadcast —
 
 GOVERN^IENTAL SOCIALISM 95 
 
 some falling on rocks and some being eaten up by birds of the 
 air. 
 
 "I will now give you one example of the difference between 
 socialism and the existing system. 
 
 "Under existing conditions consider the state of the salt 
 trade. The mines and manufacture owned and carried on by 
 a number of firms, each of which competes against all the rest. 
 
 "Result: Most of the small firms ruined; most of the large 
 firms on the verge of ruin. Salt boilers, the workmen, working 
 twelve hours a day for three shillings and the public wasting 
 more salt than they use. 
 
 "Put this trade under state control. They will cease to make 
 salt to waste. They will establish a six hour day, and they will 
 raise the wages of the men, to say two pounds a week. 
 
 "To pay these extra wages, they ^dll abolish all the unneces- 
 sary middlemen and go-betweens. The whole industry will be 
 placed under one management. A vast number of clerks, 
 agents, travelers, canvassers and advertisers will be dispensed 
 with, the salaries of the managers will be almost entirely saved, 
 and the cost of distribution will be cut down fully seventy-five 
 per cent. 
 
 "The same system would be pursued with other industries." 
 
 It is interesting to note that the process described by Mr. 
 Blatchford as the ideal of socialism is exactly that pursued by 
 American monopolies. It must therefore be a good system. 
 In America, however, it is for the benefit of the trusts and not 
 the public, which makes a difference.
 
 CHAPTER IX 
 GOVERNMENTAL SOCIALISM IN GERMANY 
 
 What individualism has accomplished — Where it has failed — ^The long arm 
 of the German state — How it guides the destinies of the citizen — Bis- 
 marck's great policy — 'The duty of the state to the citizen — The re- 
 spect in which the German government is held by the public — The 
 systematic organization of groups in all walks of life — The group or 
 combination as a lever for individual rights — The post office as a bank 
 of deposit — How money famines and panics are side tracked in Ger- 
 many — Profits of nationalized railroads — The business of recurring 
 functions — The German government as the biggest business man in 
 Europe — How German states pay dividends to their citizens instead 
 of collecting taxes — Right of the government to seize mines, lands, 
 etc. — Theory of unequal taxation as a result of government in busi- 
 ness — Holding down a job in Germany for life — Why "pull" does not 
 pull — Politicians almost a curiosity — Respect shown for men of at- 
 tainments — German trusts — How they benefit the country — How un- 
 fair competition is squelched — Real significance of trusts — The social- 
 ists only waiting for the capitalistic game to grow fat — Why the 
 American president has more power than the German Kaiser — The 
 German government really governs — The American government oc- 
 casionally wakes up but seldom catches up — Cost of trust busting. 
 
 Compared with what has been done in the United States in 
 governmental socialism, the extent to which it has developed in 
 Germany is remarkable. This is due to the fact that the Ger- 
 man takes an altogether different view of the relations of the 
 state and the individual, to that held in England and the 
 United States particularly and to a lesser extent by France and 
 other countries. 
 
 Democracy and individualism are the key notes struck by 
 the United States. Every opportunity and incentive is given 
 for the development of the individual, even the family being a 
 much weaker organization than that of France, for example, 
 where the member of the family, as such, is subject to restric- 
 tion of his individual privileges in favor of the family unit. 
 
 This insistence on the rights and privileges of the individual 
 
 has made the United States avoid governmental socialism as far 
 
 as possible. 
 
 96
 
 GOVERNMENTAL SOCIALISM IN GERMANY 97 
 
 In Germany, however, an entirely different view is taken. 
 The state is regarded paternally, to an extent uniraagined in 
 America. The state is assumed to have certain duties toward 
 the_ individual and the individual toward the state. The in- 
 dividual as an individual has a less important place in the or- 
 ganism. The welfare of the whole is the first thought, an atti- 
 tude which is the outgrowth of Roman law and autocratic 
 monarchical practices, while 'the individualistic ideas of the 
 United States and England are derived from centuries of strug- 
 gles for free political institutions, a rich heritage of liberty 
 from which Germany, too, has derived no small benefit. 
 
 The German states early looked upon the protection of the 
 weak from economic misery as one of the duties of the govern- 
 ment. 
 
 The so-called Prussian common law, as modified by Frederick 
 William II, promulgated July 1, 1794, condemned idleness, 
 recognized the right of every subject to work, and defined the 
 state to be the protector of the poor. The common law pro- 
 claimed : 
 
 I. It is the duty of the state to provide for the sustenance and 
 support of those of its subjects who cannot obtain subsistence 
 for themselves. 
 
 II. Work adapted to their strength and capacities shall be 
 supplied to those who lack means and opportunity of earning 
 a living for themselves, and those dependent upon them. 
 
 III. Those who, from laziness, love of idleness or other irregu- 
 lar proclivities, do not choose to employ the means offered them 
 of earning a living shall be kept at useful work by compulsion 
 and punishment, under proper control. 
 
 VI. The state is bound to take such measures as mil prevent 
 the destitution of its subjects, and check excessive extravagance. 
 
 XV. The police authority of every place must provide for 
 all poor and destitute persons, whose subsistence cannot be in- 
 sured in any other way. 
 
 The Stern-Hardenburg legislation of the early part of the 
 nineteenth century supplemented this fundamental law, and 
 was the basis of the doctrine of the right to work, one of the 
 strong features of Bismarck's policy. 
 
 It has continued a characteristic German practice, and is car- 
 ried out in various forms of insurance and pensions and other 
 benefits to the less fortunate members of society. 
 
 In addition to the usual functions of internal government
 
 98 THE PRICE OF INEFFICIENCY 
 
 common to most governments, as outlined in the previous 
 chapter, the German government undertakes other functions. 
 Prominent among them is the elimination of obstacles or re- 
 straints hampering individual, associated or other activity, and 
 measures fostering commerce and trade, M^hen the efforts of the 
 individuals or associations cannot gain the desired effect; the 
 operation of business enterprises when conducted unsatisfac- 
 torily by private owners, and legislation for the protection of 
 the poor against the ills of sickness, accident, old age and ex- 
 tortion of the rich ; and acts in regulation of competition and the 
 regulations of powerful units or associations to the public as a 
 whole. 
 
 In Germany, ' ' Staatsnotreeht, ' ' or the right of the state in cases 
 of necessity, is much more comprehensive than the correspond- 
 ing "right of eminent domain" in Anglo-Saxon countries. It 
 is applied not only to land but to business and other forms of 
 private property. In considering the exercise of the powers of 
 the state, the difference in the points of view of the German and 
 the American are noticeable almost at the tone of the first 
 syllable of the discussion. The German in speaking of the ac- 
 tivities and powers of the government accords it a certain inde- 
 finable authority, while the American in speaking of the acts 
 of the government, is without the same confidence and respect, 
 there being no sense of conviction or finality. It is as though 
 the act of the government were the act of a partisan and not a 
 government, and by no means to pass unquestioned. 
 
 AVilliam C. Dreher in "The German Drift towards Socialism" 
 in The Atlantic Monthly, July, 1911, states: 
 
 "It is astonishing to what an extent the Germans have gone 
 in organizing life in all its activities. The individual is every- 
 where learning that his independent strivings are ineffective 
 both for himself and for society; that as a unit he counts for 
 little. The working people long ago learned that they could 
 better their position only through organization; and as united 
 labor became more self-assertive in presenting its demands, the 
 great employers of labor, the manufacturers of the country, or- 
 ganized themselves for the purpose of protecting themselves 
 from those demands. Now both employer and employee have 
 surrendered their individual position, committing their rights 
 to the organization, which acts in its collective capacity in the 
 interests of its members; it fixes the wage-tariff and the length 
 of the day's work, it settles strikes and lock outs by treaty
 
 GOVERNMENTAL SOCIALISM IN GERMANY 99 
 
 with the opposing organization, and in a hundred ways it ab- 
 sorbs and discharges the functions of the individual in his own 
 behalf. Combinations and syndicates of manufacturers facili- 
 tate the marketing of goods, make or dictate prices, assign 
 allotments to each factory of the amount of goods that it may 
 produce, in many eases handle all orders for goods and treat 
 the individual manufacturer merely as their agent. 
 
 ' ' The state, of course, takes hold of the individual 's life much 
 more broadly, and \\dth more systematic purpose. The individ- 
 ual's health is cared for, his house is inspected, his children edu- 
 cated, he is insured against the worst ^dcissitudes of life, his sav- 
 ings are invested, his transportation of goods or persons is under- 
 taJ^en, his need to communicate with others by telegraph or 
 telephone is met — all by the paternal state or city. 
 
 "A few years ago the post office established a banking depart- 
 ment, designed more to facilitate payments than to take care of 
 savings. It is a system of open accounts, on which moneys are 
 paid in and out upon order slips — an admirable method for 
 making collections. The system has already become very popu- 
 lar; in 1910, only the second year in existence, the department 
 effected payments amounting to about $4,440,000,000. It is 
 operated in connection with the Reichsbank, with which its bal- 
 ances are deposited. The Reichsbank itself, the great cen- 
 tral note-issuing institution of the Empire, is a splendid exam- 
 ple of what is done in Germany through efficient government 
 administration. 
 
 ''While its control is owned by private persons, its adminis- 
 tration is wholly in the hands of the Imperial Government, and 
 a large part of its profits, often more than half, falls to the 
 treasury by law. With above 500 branches in all sections of 
 the land, with an annual turnover of about $85,000,000,000, 
 with a note circulation approximating $500,000,000 this great 
 institution performs an incalculable service to the people. 
 
 "Its elastic note circulation, sometimes expanded by more 
 than $125,000,000 in a single week, wholly prevents those money 
 famines that have often proved disastrous to American business 
 interests. 
 
 "Another semi-public interest is the Prussian Central Co-op- 
 erative Bank whose function is to extend cheap banking facil- 
 ities to the numerous co-operative societies that have sprung up 
 in Prussia ; its capital of $9,000,000 is supplied by the state, and 
 its administration is under the supervision of the Finance Min-
 
 100 THE PRICE OF INEFFICIENCY 
 
 ister. The Seehandlung, which is the Prussian state bank, is 
 the largest lender of money in the Berlin market. Nearly all 
 the savings bank business is done by public institutions — only 
 about eight per cent of the total deposits in savings banks be- 
 ing vrith private institutions. 
 
 *'At the end of 1907 there were above 2,700 municipal and 
 provincial savings banks, with 6,600 branches, and their deposits 
 amounted to more than $3,000,000,000. At that time above 
 twenty-eight persons in every one hundred Germans held an 
 account in a savings bank. Such is the extent to which semi- 
 socialistic banking has taken hold of the German people. 
 
 "The railway, as is well known, is almost wholly a state in- 
 stitution in Germany. The Prussian system, with its more than 
 400,000 laborers and officials, is the largest employer of labor 
 in the world; and this vast business is administered with re- 
 markable honesty and efficiency. Cases of embezzlement or 
 other crime are extremely rare ; relatively few persons are killed 
 or maimed through accident; and the railways are kept quite 
 aloof from politics. 
 
 "Freight rates, indeed, are considerably higher than the 
 average American rates, but the bulk of the passenger traffic is 
 carried at lower prices than in America. Bismarck's purpose 
 to use the railway wholly in the interests of the people, as de- 
 clared when he nationalized the roads, has not been fully carried 
 out, since rates have been kept at a high enough figure to make 
 them the largest source of revenue for the state, besides paying 
 interest on the capital invested. On the other hand, shippers 
 have the advantage of absolutely fair treatment ; there is no dis- 
 crimination among them, there are no rebates, secret or other. 
 Another great advantage consists in having a single system to 
 deal with, as well as simplified tariff schedules. Before the 
 nationalization, there were 63 railways with 1,357 different 
 tariffs." 
 
 There are certain forms of industiy which seem peculiarly 
 fitted for governmental control, among them being the railroad 
 and post office. The reason for this may lie in the fact that they 
 are vast machines which when once set in motion require little 
 or no initiative on the part of the employees. They are forms 
 of activity in which no concrete result is left; being rather a 
 series of operations, carried out over and over again. Thus 
 when a letter is delivered, no product is left, nothing has been 
 created, the location of the letter has only been changed. A
 
 GOVERNMENTAL SOCIALISM IN GERMANY 101 
 
 million letters through the same process require no further 
 technical adaptation on the part of the employees. A vast or- 
 ganization, thus, which exists but to perform functions, when 
 once erected continues of its own momentum, and is an entirely 
 different problem from the conducting of a business, where new 
 ideas must be constantly introduced, and the active competition 
 of others met and overcome. If the letter carrier was constantly 
 pursued by others, endeavoring to get the letters away and de- 
 liver them by another route, or if he met constant opposition 
 to his progress, the delivery of the mail would be an entirely 
 different operation, and more like business competition. 
 
 Yet the German governmental socialism has been carried to 
 such a point, that the state can and does successfully conduct 
 business of a competitive nature, involving great initiative and 
 the constant adoption of new ideas. This is rendered possible 
 in Germany by the fact that there the officials are willing to 
 devote to the affairs of the state the same energy that they 
 would devote to their private concerns. 
 
 The extent to which Germany as a state has gone into busi- 
 ness may be grasped by considering the amount and the vari- 
 ous sources of the profits of the businesses engaged in. 
 
 Elmer Roberts in "Monarchical Socialism in Germany" in 
 Scrihner's Magazine, January, 1910, states: 
 
 ''The Imperial government and the governments of the Ger- 
 man states took profits in 1908, from the various businesses 
 conducted by them, of $277,385,095. Estimating the capital 
 value at a 4% ratio, the value of the productive state 
 owned properties is $6,933,627,375. Roundly, the governments 
 operate dividend yielding works, lands, and means of communi- 
 cation worth $7,000,000,000, and the governments continue to 
 follow a policy of fresh acquisitions. Taking the federated 
 states together, 38% of all the financial requirements for 
 governmental purposes were met last year out of profits of 
 government-owned enterprises. Including the Imperial govern- 
 ment, a new comer with relatively few possessions, one-quarter 
 of all the expenses of the state and the imperial governments, 
 on army, navy and all other purposes, were paid out of the net 
 profits on governmental businesses. Among the undertakings 
 are no tobacco, spirit or match monopolies. 
 
 "The miniature ducal monarchy of Schaumburg-Lippe, with 
 a population of 44,992, and an area of 131 square miles, made 
 $206,150 from property owned collectively, or 5% of the
 
 102 TPIE PRICE OF INEFFICIENCY 
 
 requirements of the state. The still smaller principality of 
 Reuss, the elder, with 122 square miles, and a population of 
 70,603, makes a profit of $10,000, the smallest actually, and the 
 smallest in proportion of any of the German states. The little 
 neighbor of Reuss, Schwarzburg-Sonderhausen, draws 33% of the 
 budget from farms and forests; Oldenburg, 22%; Mecklenburg- 
 Strelitz, 49.14%. But it is the great states of the empire where 
 state management of large properties shows the more important 
 results. Bavaria pays 39% of all of the administrative costs 
 from public-owned properties; Saxony, 31%; Wurtemberg, 
 38.7%; and Prussia, 47.36%. 
 
 " Prussia, which forms about five-eighths of the empire, has 
 a constantly increasing revenue from state-owned enterprises, 
 which yielded in 1908 net returns of about $176,000,000, or 
 more than twice the state's income from taxes, which was $85,- 
 452,000 ; the average income from its enterprises per capita was 
 18.1 marks, while the average per capita taken in taxation was 
 8.7 marks. In that year the state, owing to extensions in canals, 
 railways and other public works, raised by loans what amounted 
 to an average of 7.1 marks per capita. 
 
 "The state income from public properties amounted in 1908 
 to somewhat more than the total income from taxation and from 
 borrowings. The railways were the largest source of income, 
 and netted $149,755,000 or about 8% on the total invested 
 by Prussia in its railway system since the state began to buy 
 and build railways in 1848-49. 
 
 "Prussia derived from other sources, from its crown forests, 
 the leased farms, the iron, coal, potash, salt and other mines, the 
 porcelain factories, banking and a variety of less important in- 
 dustries, $26,900,000. The policy of Prussia, which dominates 
 the empire, is strongly in the direction of increasing the partici- 
 pation of the government in industrial enterprises. The Prus- 
 sian legislature, acting upon a recommendation of the emperor, 
 in the speech from the throne, at the opening of the Diet in 
 1906, passed a bill extending widely an old act, giving the state 
 the right to take over at a valuation any discovery of mineral 
 riches on private lands. 
 
 "The theory of the Prussian cabinet and the crown is that it 
 is for the interests of the people that the state should take part 
 in industrial combinations that undertake to regulate the prices 
 of articles, or the products in any industry. Public opinion 
 supports this principle.
 
 GOVERNMENTAL SOCIALISM IN GERMANY 103 
 
 "A summary of the government owned properties and the 
 income derived from them is subjoined : 
 
 Values Net Incomes 
 
 Farms $ 198,122,725 $ 7,925,309 
 
 Forests 730,898,200 29,235,928 
 
 Mines 128,907,725 5,116,309 
 
 Railways 4,706,904,750 189,916,190 
 
 Telephones 
 
 Telegraphs 1 
 
 Express packages [■ 094,816,650 27,792,666 
 
 Mails ) 
 
 Other works 435,184,900 17,407,476 
 
 "Upon no department of industry do any of the state gov- 
 ernments lose except on steamers. The grand duchy of Baden 
 runs its internal navigation lines at a loss of $15,833. Saxony, 
 Wurtemberg and Mecklenburg-Schwerin gain on their lines 
 $7,163, so that on the whole of the state-owned steamer lines 
 there is a loss of $8,670." 
 
 The question as to whether the government should or should 
 not make any profit out of its enterprises is one which has been 
 very practically decided in favor of profit. Theoretically the 
 profit of a government enterprise is a form of indirect taxation. 
 In the United States the taxation which business profits amount 
 to, is laid on the public as an encouragement for individual in- 
 itiative on the part of the business man and goes to the business 
 man. The profits of a governmental business are a tax on that 
 portion of the public which patronizes that part of the govern- 
 ment's business. It is a discrimination against the customer in 
 favor of those who do not purchase. On the other hand, if the 
 enterprises were run without a profit or loss, the facilities of 
 the state would be in a sense unduly extended to customers of 
 the business, since they would be securing service at less than 
 the commercial rate, and such a plan would be a discrimination 
 in favor of the customer. 
 
 It is a question, however, whether this would not be the better 
 plan, allowing the government to raise all the money needed by 
 direct taxation. 
 
 Low prices to all would stimulate business greatly and allow 
 the public to make profits in its individual business and have 
 the use of all its capital to a later moment, thus being better 
 able to pay the taxes when the time for their withdrawal came. 
 
 If instead of having to pay freight rates which show the gov-
 
 104 THE PRICE OF INEFFICIENCY 
 
 ernment a profit, the business men had the advantage during 
 the year of cost freight rates, the capital which he would thus 
 retain in his own business could be turned over two or three 
 times at a considerable profit, enabling him at the end of the 
 year to pay the direct tax out of the profits of the turn overs. 
 Thus the burden of taxation would be entirely lifted, merely by 
 an administrative device, for it is highly important to the busi- 
 ness man and to industry as a whole to have the benefit of as 
 much capital and credit as they can employ to advantage. 
 
 The ease with which the government gets funds, through 
 profits on its businesses, however, while an immediate drain on 
 capital and an encouragement to official extravagance, is for 
 practical purposes such an administrative convenience, that as 
 a system it is likely to continue. 
 
 There is not, either, in Germany, the official extravagance 
 shown by the servants of the public, as in the United States, for 
 owing partially to the bureaucratic system and partly to an 
 identification of the interests of the employee and employer, 
 whether the employer be the government or an individual, bet- 
 ter service is secured and temptation to extravagance is not 
 given way to. 
 
 When a man gets a job in Germany, whether with the govern- 
 ment or with a corporation or individual employer, he expects 
 to hold it down for twenty-five years at least if not for his life 
 time. He does not, as in the United States, expect to stay in 
 the business just long enough to get a suit of clothes and start 
 some other business on his own account. Expecting to stay 
 with his employer, it is to his interest to contribute all he can 
 to his employer's success. In the case of a governmental service, 
 the employee enters it with the idea of making it his life career, 
 and not, as in America, of making it a temporary but lucrative 
 perquisite. 
 
 As every individual has his own ambition, and must express 
 what his life means to him in some way, if as in Germany the 
 ambition of the employee is in his employer's interest, or the 
 state's interest, the service he gives will be the best that is in 
 him. 
 
 This relationship between the employer and employee is one 
 of the cornerstones of German progress. It gives a solidarity 
 to an enterprise or a service that is wanting when the em- 
 ployees and employer are constantly warring and the employer
 
 GOVERNIMENTAL SOCIALISM IN GER]\rANY 105 
 
 watching the clock in the morning as closely as the employee 
 watches it in the evening. 
 
 On their part, the government and the private employer, in 
 taking on an employee, expect him to remain permanently. 
 They realize that their interests are identical. In Germany the 
 employee works for the employer and the employer works for 
 the employee, the government for the public (its employer) and 
 the public for the government, a system entirely different from 
 the American plan of everybody for his own pocket and the 
 devil take the hindmost. 
 
 In Germany, too, the greatest respect is shown for those in 
 authority, a deference that seems to an American to reach the 
 point of absurdity ; but let the German official show the slightest 
 dereliction of duty and the average citizen will report the mat- 
 ter promptly to the Polezei, Biirgermeister, Landrat or Gover- 
 nor as the case may require, successively if necessary, and some- 
 thing is done about it, a very different process from the Ameri- 
 can's bluff of taking a street car conductor's number as well as 
 his back talk and going no further. 
 
 One of the adornments of the American street car which 
 frightens the incoming German and arouses his indignation is 
 the sign, "$500 fine or one year in prison for spitting on the 
 floor." In Germany the penalty is three marks (75 cents) and 
 the loss of half a day's time in paying it, but everj^body who 
 spits gets caught and is fined. When the German here, how- 
 ever, sees that the spitter spits at his own sweet will and nobody 
 is ever imprisoned for it or fined, he gets a new insight into 
 what may be called American humor, and finds that seemingly, 
 the principal result of the sign is to provoke spitting. It is, 
 in reality, however, but one of a vast number of American laws 
 which are dead letters because the punishment does not fit the 
 crime, that it is so vastly in excess of the requirements as to 
 cover and serve rather as a hot house for the crime. 
 
 Another factor of great importance in the success of Ger- 
 many's undertakings is the freedom from political influence 
 observed in appointments. A striking example of this freedom 
 is seen in the method of selecting governmental and city em- 
 ployees, all of whom must have a requisite degree of training. 
 Cities advertise even for the most important of their officials, 
 such as mayor, chamberlain, fire and police commissioners, etc. 
 The larger cities have several burgomasters trained in different
 
 106 THE PRICE OF INEFFICIENCY 
 
 fields who serve under one head burgomaster, practically a 
 commission form of government. 
 
 Ste ©Idle beg Srjlcn Siirgermeifierl 6er Stabt aWogbcBurg 
 Ifl ittfi)l9e ®rnennutt8 beg 0errn .JOberfeiirgermeiftetg Dr. Settle 
 ^m |)tci!f]lf(^ctt ginan^minifier nm su 6efefctt. 
 
 3)Q§ @e|alt ifi tjorbe^altlid) ber (Bene^mlpng bc§ ?Be5irf0> 
 3lu§f{|uffeg m^ 21000 S?Jf. feftgcfe^t mhd 3000W. fur freic 
 2)iettfln3o^nung m 5?at^oufe mit einbegrtffcn fmb. 2)iefe ^tcttj}* 
 tuo^nung Itsirb abet tiur auf Sibcttuf Ba^i clnja^nget Miibigiing 
 geluQ^rt, mh mthm, \mmi t)on hUfa ^thxuu^ gema^t tuerben 
 foate, 3000 2Wf. aB SgoljnungScntf^iabisnng Uergutet. 
 
 9Jeben bem ©eljalte be^ieljt ber ©eiuc^Ue |a^rli(^ 4000 2!if. 
 Siienjiauftuanbggelber, mlHit bet jpeiifiongberei^tigung mji^t unter» 
 liegen. 
 
 2)ie flje^ietten Sa^MBebingungen merben htn 25en)erbern, 
 iceld^e i^re 2ReIbung big pm 1. ©e^jtember b igg* an ben Unter* 
 3ei(^neten etnreii^en ttioden, auf drfarbern abl^rifUii^ mttget^tlt 
 
 2?lagbebtirg, ben 30. gnni 1910. 
 
 2)er Sorriftcnbe ber ©tabtberorbneten*23erfammIttng. 
 
 Saenfrfj. 
 
 The above is a reproduction of an advertisement of Magde- 
 burg, a city of a quarter of a million population, for a mayor, 
 which appeared with many similar advertisements in the German 
 Municipal Weekly of July 23, 1910. Such an advertisement as 
 this would give many local politicians in an American city a dis- 
 tinct shock. They would think there was an abundance of local 
 talent to fill the position. German cities choose their mayors as 
 well as other officials in this way, obtaining men who have made a 
 reputation in other cities, just as American universities choose 
 their presidents and professors. The following is a translation 
 of the advertisement: 
 
 *'The position of First Mayor of the City of Magdeburg, in 
 consequence of the appointment of Mr. Head Mayor Dr. Lentze 
 as Prussian Finance Minister, must be refilled. 
 
 "The salary is provisionally fixed by the council at 21,000 
 marks, included in which is an allowance of 3000 marks for free 
 residence in the city hall. A year's notice of change of residence 
 must be given, and subsequently the city will make an allowance 
 of 3000 marks for residence purpose.
 
 GOVERNMENTAL SOCIALISM IN GERMANY 107 
 
 "The official selected will also receive an allowance of 4000 
 marks for incidental expenses, which however, will not be re- 
 garded as part of his salary when his pension allowance is de- 
 termined. Copies of the specific requirements of the election 
 which must be complied with by the candidates, whose applica- 
 tion must reach the undersigned on or before the 1st of Septem- 
 ber of this year, are obtainable upon request." 
 
 Magdeburg, June 30th, 1910. 
 The Chairman of the City Council 
 
 Baensch. 
 
 The highest regard is shown in all German undertakings for 
 technical experience and expert technical knowledge. In the 
 United States an expert in any line is too apt to be regarded 
 either as a book worm or a crank of some kind; while he may 
 be supposed to have an ample fund of expert knowdedge, he is 
 too often assumed to be lacking in judgment, a quality more or 
 less monopolized by the "business man," a term which variously 
 embraces the banker, the promoter, the merchant and the ad- 
 ministrator of commercial and manufacturing enterprises. 
 
 The "business man" in the United States occupies the center 
 of the stage, which in Germany is held by the man of technical 
 knowledge, the engineer and the chemist. From Emperor Wil- 
 liam down, the greatest interest is taken in the work of engi- 
 neers, architects, chemists and other trained experts, and 
 credit and other rewards are freely rendered them. The busi- 
 ness man is much less heard of in Germany, and the "tired 
 business man" who rules the theater in America in his insist- 
 ence on pieces which demand little thought and supply much 
 diversion, is entirely unknown. 
 
 The efficiency of German governmental undertakings as has 
 been stated is greatly enhanced by the lack of politics in busi- 
 ness, which is such a bane in America. In Germany there is 
 little or none of the political activity, the clubs, organizations 
 and wire pulling of the United States, and what little there is 
 is usually done by the clergy, in the interest of returning cer- 
 tain members to the Reichstag. A ward heeling clergyman 
 would be something of a novelty in America, but he would be 
 much less harmful than a ward heeling bartender. 
 
 The few elective offices in Germany, too, compared with 
 America, renders politics as a business one of small profit, and 
 one which is not professionally followed as in America. Clergy-
 
 108 THE PRICE OF INEFFICIENCY 
 
 men shaking the voters hands on election day is not a problem in 
 German life, while the small politician is one of the gravest of 
 America's problems. 
 
 Foreigners unacquainted with conditions in Germany and 
 whose German horizon is considerably limited by the large 
 looming of the Kaiser in the foreground, often talk of tyranni- 
 cal domination, and one man power. These are idle expres- 
 sions. The Kaiser has not the power of an American president. 
 Property and capital are more equitably distributed in Ger- 
 many than in any other country and Germany is more of a 
 self ruled country than any other country, far more than Eng- 
 land ruled by the classes and America ruled by the minority. 
 
 The governmental socialism of Germany, which is proving 
 such a distinguished success, is from the people by the people 
 and for the people; it is popular and has been instituted and 
 continued by them and is not an enforcement from rulers or an 
 aristocracy. 
 
 The treatment of the trust problem is vitally different in 
 Germany. Trusts such as we know them in America do not 
 exist in Germany, but trade combinations known by that name 
 or by the name of syndicates or cartels are very effective and 
 numerous. 
 
 Consul General Robert P. Skinner at Hamburg, describes in 
 the United States Daily Consular and Trade Reports, for Sept. 
 15, 1911, the operation of these trusts: 
 
 "There is no German law which either expressly authorizes 
 or forbids the creation of the so-called tnists so numerous in this 
 country. The law merely guarantees to the individual the 
 right to engage in trade, but does not withhold from him the 
 right to combine with any or all of his competitors. The theory 
 seems to be that in granting to trade and commerce the very 
 extensive privileges referred to by my correspondent, the gen- 
 eral interests of the public at large are protected by the result- 
 ing prosperity of such interests, even though the immediate 
 effect may be to enhance the cost of the commodity controlled. 
 
 "In a recent discussion of the subject, Mr. Albert Ballin, the 
 general director of the Hamburg-American Line said: *In 
 Germany syndicates are protected by several laws, and therefore 
 it may arise very easily that the American government would 
 require the dissolution of a syndicate, while the dissolution, ac- 
 cording to German law, itself would become punishable.' The 
 majority of German business men and economists are not op-
 
 GOVERNMENTAL SOCI^VLISM IN GERMANY 109 
 
 posed to such syndicates, and the creation of monopolies, in 
 which the state itself sometimes participates in combination with 
 private producers, is lawful if the creators commit no injurious 
 act, a limitation so difficult to define and comprehend that prac- 
 tically the only difficulties with which the ordinary cartels come 
 in contact are the difficulties arising between the members them- 
 selves. The courts have frequently recognized the perfect right 
 of producers to control their product in a monopolistic organiza- 
 tion as a right somewhat akin to the right to make use of a 
 highway, and only subject to correction of abuses of power. 
 
 ' ' The profound difference between the German and the Amer- 
 ican conception of sound business conditions is best explained, 
 perhaps, by the racial difference between the two peoples — the 
 German with strong collectivist tendencies which manifest them- 
 selves in society, in government and in trade, and the American 
 with a deeply rooted individualism which remains even when 
 he engages in a collectivist enterprise. Thus it happens that 
 the capitalistic classes of Germany, although opposing social- 
 ism in their public life, nevertheless drift in the direction indi- 
 cated by their natural tendencies in their business life, and in 
 so doing they have the tacit approval of the avowed socialistic 
 classes, who perceive in the steady accumulation of the produc- 
 ing powers in a few hands a movement tending logically and 
 inevitably toward the eventful realization of their dogma — that 
 is, the state in supreme control. 
 
 "An extreme example of the German tendency may be found 
 in the potash syndicate, of which so much has been heard. In 
 this case the Prussian state itself was one of the producers, and 
 when a certain situation was reached, the state interposed and 
 required by law that the entire production of the country should 
 be sold through a single selling agency, organized by law, which 
 also established the terms of sale and the limitation of produc- 
 tion. In this case it was argued that the monopolization of the 
 industry was necessary to conserve the important mineral re- 
 sources of the country. The commentators upon the claim of 
 industrial organizers that some generally desirable end is to be 
 attained point out, as has Gustav le Bon— that— ' Socialism is 
 much less dangerous in reality in its absolute form than 
 when it takes on the aspects of simple projects of amelioration 
 by regulating labor. Under its absolute form one sees the dan- 
 gers and may control them. Under its altruistic form, one does 
 not see them and it is accepted easily.'
 
 110 THE PRICE OF INEFFICIENCY 
 
 "The German courts have repeatedly ruled, according to 
 Richard Calwer, the socialistic writer, in his Cartelle und 
 Trusts, that the syndicates do not violate the principles of trade 
 liberty as they tend to protect the interests of the whole nation 
 against the selfishness of individuals, and to protect the prod- 
 ucts of industry from the many disadvantages of price cut- 
 ting. 
 
 "Under these rulings absolute or partial monopolization by 
 many cartels has been brought about, the national output being 
 reduced, with a consequent lifting of prices to a remunerative 
 level. The danger point would be reached, from the point of 
 view of the law, should a cartel of this character, on the possi- 
 ble refusal of one outside producer to accept its terms, under- 
 take by unfair means to drive him into its fold or crush him if 
 he refused its terms, and the difficulty of the prosecution would 
 be to prove that any such results had been contemplated, even 
 though its effect had been attained. 
 
 "The very form of commercial organization most common in 
 Germany and America correspond to the temperamental qualities 
 of the two peoples. In Germany the commercial trust or cartel 
 is usually a federation in which each member retains its com- 
 mercial identity while abandoning its freedom of action to the 
 federation for a contractual period of three or five or ten years 
 or perhaps longer, but expecting eventually to get it back, and 
 then perhaps make another contract if the results of the first 
 have been satisfactory. A German cartel is, as a rule, open to 
 all those who submit to its provisions, and the control of the 
 members is confined to the limits traced in the federal pact. In 
 the typical American trust, instead of this association of units 
 with influence usually rated according to productive capacity, 
 we observe generally the permanent ownership of a large part 
 of the enterprise by a small group of persons in which there is 
 ordinarily some dominating personal element. 
 
 "The basic notion of the German organizer has been to con- 
 trol production definitely, leaving it to the resourcefulness of 
 the individual producers in the cartel to make more or less 
 profit out of the proportion of the production allotted to them; 
 the basic notion of the American organizer has been, usually, 
 to create a perfected and consolidated instrument, success fol- 
 lowing naturally as a result of its well-balanced and skillfully 
 organized proportions. German cartel organizations has con- 
 templated that all its constituent firms should remain in busi-
 
 GOVERNMENTAL SOCIALISM IN GERMANY 111 
 
 ness; American commercial centralization usually has meant 
 that the weaker or for any reason undesirable elements should 
 go out of business, suggesting that the strong native individual- 
 ism of our people rises to the surface even when an effort tend- 
 ing toward pure collectivism is attempted. 
 
 ''The highest degi-ee of syndication in Germany has been 
 reached in the mining and iron industries. Although the num- 
 ber of cartels existing in these industries is not large, they are 
 mainly well organized and very strong; for example, the Rhen- 
 ish-Westphalian coal syndicate in Essen, the Stahlwerks-Ver- 
 band, or steel syndicate in Dusseldorf. 
 
 "The Imperial German government issued statistics in 1905 
 showing that there were 385 cartels existing at that time in Ger- 
 many, but these figures are said not to contain the Kondition- 
 skartelle (those, e. g. fixing terms of sale other than prices), and 
 numerous other confederations, the existence of which was not 
 then within the knowledge of the authorities. When these sta- 
 tistics were made up, it was understood that about 12,000 es- 
 tablishments were members of syndicates. The following recap- 
 itulation shows the variety of industries covered by commercial 
 combinations in 1905. 
 
 Coal mining 19 
 
 Stones and earths 27 
 
 Brick Industry 132 
 
 Earthenware industry 4 
 
 Glass industry 10 
 
 Metal trade 11 
 
 Iron industry 62 
 
 Machinery, electricity 2 
 
 Chemical industries 46 
 
 Textiles 31 
 
 Paper industry 6 
 
 Leather trade 6 
 
 Wool industry 15 
 
 Food prodvicts 7 
 
 Miscellaneous 7 
 
 Total 385 
 
 Consul Talbot J. Albert of Brunswick, reports in reference 
 to the German potash syndicate: 
 
 "The potash syndicate furnishes an excellent example of 
 what constitutes a German syndicate and what distinguishes it 
 from an American trust. It is only by the study of a concrete 
 example that the difference can be clearly understood.
 
 112 THE PRICE OF INEFFICIENCY 
 
 "There are two most significant and material distinctions. 
 The first is that the potash syndicate and most of the other 
 syndicates have, as such, no capital or shares of stock which 
 are dealt in on the stock exchange, as is the case with the Amer- 
 ican trust. The second distinction is that a syndicate is a com- 
 bination for a limited period of time, usually five years, while 
 the life of a trust is indefinite. 
 
 ''The units composing the potash syndicate and most mining 
 syndicates in Germany are companies of two kinds, namely 
 those whose capital is divided into shares called 'kuxe' and those 
 whose shares are of the ordinary joint-stock variety with limited 
 liability. The shares of the joint stock companies are unassess- 
 able, but on the other hand ' kuxe ' are shares that are assessable 
 at any time and are of unlimited liability. These 'kuxe' and 
 shares of the individual concerns are dealt in on the exchanges 
 of the large cities of Germany. 
 
 "Each company that is a member of a German syndicate has 
 its representative on the board of management of the trust, and 
 this board fixes the quota of production allowed each mine and 
 generally administers the affairs of the entire combination 
 under the constitution and by-laws (called statuten). The con- 
 stitution and by-laws must be signed by each concern entering 
 the syndicate and the provisions therein contained strictly ob- 
 served under penalties enforceable in courts of law. The mu- 
 tual obligations of the syndicate toward its constituent members 
 and the duties of the members toward the syndicate are thus 
 protected by law, making it a legal combination. 
 
 ' ' The weak point in this form of organization is the dissension 
 that often arises as to the quotas allowed the different mem- 
 bers. Each company wants as large an allotment as it can get 
 and there is disappointment if it is not received. For this rea- 
 son, upon the expiration of the life of a syndicate, there is al- 
 ways uncertainty as to whether it will be renewed owing to the 
 competition among the various constituent firms. 
 
 "The object of a syndicate is not monopoly but the preven- 
 tion of competition. It is an agreement among producers of 
 an article to prevent overproduction, so that the supply will 
 conform to the demand and reasonable profits may be obtained. 
 There is no outcry in Germany against syndicates; they are 
 generally looked upon as organizations advantageous to well- 
 regulated trade. 
 
 "The German potash syndicate, a combination of 76 com-
 
 GOVERNMENTAL SOCIALISM IN GERMANY 113 
 
 panies, is now practically in complete control of the potash min- 
 ing interests of Germany. 
 
 "As Germany is the only country in the world in which 
 potash mines are being profitably worked, and as the mines are 
 controlled by one combination and their production and sales of 
 potash regulated by the special law recently passed by the 
 Reichstag, the German potash syndicate may be fitly termed a 
 legally reenforced trust. The unworked potash field in the 
 Duchy of Brunswick, Province of Hanover, and elsewhere in 
 Germany is immense, and the kali supply is inexhaustible, but 
 under the law, no new mine or combination of mines can be- 
 come successful competitors of the syndicate. As soon as the 
 mine reaches the productive stage, it it taken into the syndi- 
 cate. 
 
 "The propaganda conducted by the syndicate makes the de- 
 mand for potash equal the supply. Special prices for manure 
 salts are given by the syndicate to the German agriculturists 
 and special railroad rates for transportation are granted by the 
 government. The syndicate with its representatives in the 
 United States and in other foreign countries will regulate the 
 foreign prices for potash. This is an important matter for 
 foreign agriculturists and for foreign consumers of chlorate of 
 potash for the manufacture of powder and other explosives." 
 
 From the foregoing, it will be seen that Germany regulates 
 the trusts to secure the best advantage to the public at large, 
 while in America, the trusts after having been allowed to reach 
 a high point of development, through the inefficiency of the 
 government in not enforcing the law as it exists, must now be 
 regulated or reorganized to the great disturbance of business 
 and loss to the general public. 
 
 Developments have proved that the Sherman law has teeth, 
 and that the courts will enforce it. The fact that it has not 
 been enforced is due to the negligence of the administrations 
 of Harrison, Cleveland and McKinley, and only with Roosevelt 
 was a beginning made. While these presidents may be blamed, 
 the public itself is most to blame, since it has only been its 
 belated voice of protest that has finally caused action, a voice 
 which should have been heard long ago. 
 
 In England trusts are very quickly killed by the public boy- 
 cotting them. In America, the slight advantages temporarily 
 offered by the trusts overshadows the certain subsequent higher 
 prices, and the public patronize them until the small dealer
 
 114 THE PRICE OF INEFFICIENCY 
 
 is exterminated, later paying well for its folly when competi- 
 tion has disappeared. 
 
 The cost of breaking up or reorganizing the trusts is enor- 
 mous, both in the direct expense of governmental legal actions 
 and in costs to the trusts themselves, while it is incalculable in 
 the disturbance to business. 
 
 The business of a self governing country is to govern itself. 
 When it neglects the matter, it pays a frightful price. Amer- 
 ica is paying the price to-day, and the paying is by no means 
 nearing an end. Its future depends upon the firmness with which 
 it proceeds to discipline its law breaking citizens in high places. 
 
 The responsibility lies not alone with the native American but 
 with the naturalized voter as well, and particularly with the 
 German voter who has known better conditions in Germany. 
 Naturalized voters would hold the balance of power should they 
 act as a unit. According to the U. S. Census there are 6,646,817 
 foreign born white males of voting age in the United States of 
 which number 3,034,117 are naturalized or 45.6%. Seventy per 
 cent, of the 1,278,679 Germans are naturalized, the largest pro- 
 portion, followed closely by the Irish, while only 26% of the 737,- 
 150 Russians and 18% of the 712,827 Italians have become citi- 
 zens. 
 
 Those who are not well informed are of the impression that 
 Americans are largely of Anglo-Saxon stock but the figures dis- 
 prove that belief. In the 90 years from 1820 to 1910 the im- 
 migration was as follows : Germans, 5,400,000 ; Irish, 4,800,000 ; 
 Austro-Hungarian, 3,200,000 ; Italian, 3,100,000 ; English, Scotch 
 and Welsh, 2,800,000; Russian, 2,400,000; Swedish, 1,100,000; 
 French, 480,000 and other countries about 5,000,000, a grand 
 total of 28,000,000. In 1820 the population was about 9,000,000, 
 including a considerable Irish immigration. It is incontroverti- 
 ble from these figures that the so-called Anglo-Saxon is but a 
 small minority of the whole and that the effort to classify Ameri- 
 cans as an Anglo-Saxon race is futile. 
 
 Germany in the last century has furnished us nearly 6,000,- 
 000 immigrants, and it is obvious, if this element of the popula- 
 tion acted as a unit and overcame its aversion to political activity, 
 that much greater efficiency would result. Had the German 
 ideals of public office been enforced rather than existing systems 
 of patronage America would be a much better governed and more 
 prosperous country to-day. It behooves the German element to 
 rally to the standard of good government and overcome the dis- 
 integrating influences at work.
 
 CHAPTER X 
 MUNICIPAL SOCIALISM 
 
 A great eity-building epoch — ^How inventions have caused humanity to 
 gravitate to cities — The reproach of city self government — German 
 civic pride — Why home rule is denied to our cities — "Sacred" concerts 
 in New York — Liberty and the size of spots on a comedian's vest — 
 Lack of city patriotism — Debasing effects of private ownership of public 
 franchises — The battlements of commerce — Masterpieces of architect- 
 ural ugliness — Carnival of civic chaos — Rudiments of architectural 
 taste in engineering works — Municipal Art Commission — The redeem- 
 ing sky scrapers — Far-sightedness of the planning of German cities as 
 wholes — American cities at the mercy of private landowners — Barbar- 
 ous water fronts of American cities — German cities as great land 
 owners and land lords — 75 lessons which American cities may learn 
 abroad. 
 
 The city is the great factor in the life of the world to-day, 
 particularly in America and in Germanj'. In a little more 
 than a generation, a great transposition has taken place. The 
 rural districts have been drained of their surplus of men, a 
 surplus composed of its best blood and brain. The lure of the 
 city, its greater possibilities and advantages have produced 
 great changes which have taken place rapidly and which are 
 continuing at the same if not at a more rapid rate. 
 
 What has brought about this wonderful change ? There have 
 always been cities since the earliest times. Cities of prehistoric 
 epochs are constantly being unearthed, cities whose very names 
 and existence were forgotten for ages, but never before has 
 there been the growth of cities at the expense of the country 
 that is now being witnessed, and the remarkable development 
 of the building of cities, which makes the present an epoch in 
 the history of the world comparable with the great city build- 
 ing epochs of the Romans in the age of the Antonines and the 
 city building of the middle ages, produced by political con- 
 siderations. 
 
 The underlying cause of the growth of cities in modem times 
 is found in the numerous triumphs of invention during the last 
 
 115
 
 116 THE PRICE OF INEFFICIENCY 
 
 fifty years. As has been pointed out, every labor saving in- 
 vention reduces the stress between humanity and nature. 
 Either more human beings may be fed and clothed and housed 
 at the same outlay of human labor, or a given number may be 
 made much more comfortable. The invention of cloth making 
 machinery gives the working girl of to-day clothes which only 
 nobility could afford in former ages, and the improvements in 
 iron and steel and cement make houses far cheaper than for- 
 merly. Harvesting machinery and other improved farming im- 
 plements enable greater crops to be raised with no more labor, 
 making food cheaper. Summed up in their collective effects the 
 enormous number of labor saving inventions have worked them- 
 selves out as a freeing from the bondage of the soil of a great 
 proportion who previously found it to their advantage to re- 
 main on the farm to feed and clothe humanity. Before the 
 days of improved farm machinery, a hundred farmers had to 
 labor, for example, to supply the food of a hundred city dwellers, 
 while the city dwellers supplied the farmers' needs in manu- 
 factured products. Now vsdth improved farming machinery, 
 fifty farmers, to assume a round figure, which may or may not 
 be correct, can supply the wants of the same hundred city 
 dwellers and in addition of the fifty farmers who have gone to 
 town, while the city dwellers wath their improved appliances 
 can supply the fifty farmers left in the country and the fifty 
 who have moved to town, with much better goods at less ex- 
 penditure of labor than before. The comfort of all is thus 
 greatly increased, and the less rigorous conditions enable the 
 population to increase more readily. 
 
 The extent to which this process has been carried on may be 
 best understood by consulting the statistics of city growth. 
 Over 40% of the people of the United States live in cities. 
 From 60 to 80% is the ratio in some of the eastern states. In 
 our population of 90,000,000 there are 35,000,000 who would 
 now be on farms instead of in cities if former conditions had 
 continued. 
 
 In Germany a similar change has occurred as will be noticed 
 from figures given later. The city is the thing of to-day, a 
 great, cruel, criminal thing of poverty and disease, with vivid 
 contrasts of wealth, like the glint of a diamond on a scrofulous 
 hand, a place where human nature may find its own level, high 
 or low, free of the restraints of the village and farm. 
 America's problem, the world's problem of to-day is the city,
 
 MUNICIPAL SOCIALISM 117 
 
 and it is the problem of problems, how humanity may best 
 direct itself for its own good in its new found liberties, how 
 the city may be prevented from doing the evil that is in it and 
 made to render its advantages to humanity; in short, how the 
 city may be made to make good. 
 
 The modern city, thus a new thing, has brought new problems 
 and these must be dealt with in a new way. The city in Amer- 
 ica has proved a great disappointment, a reproach to republican 
 institutions and a well-spring of pessimistic forebodings. But 
 the city in America has not had a fair chance. Conditions have 
 forced it to pursue its growth along the lines of least resistance, 
 and strange growths have resulted, like the roots of an oak 
 among flagstones and tombs, bursting the bonds of the past 
 and embedding their fragments in the new growth. 
 
 What the possibilities of the American city are, may be seen 
 from the development of cities in Germany, where the city has 
 had every chance, where human nature and every social force 
 works with the city and for its development, rather than in op- 
 position. The city is the pride of modern Germany and made 
 so by the same class of men, its leading business men, who 
 work so tirelessly against the interests of the city in America. 
 
 The American city is poisoned at its well springs, principally 
 by three causes, none of which operate to the disadvantage of 
 the German city. 
 
 Perhaps the most important is the fact that American cities 
 do not have home rule. Their affairs are regulated by legisla- 
 tors of the state in which the city is located. Their form of 
 government is imposed on them by the state, their charters are 
 granted and amended by the state and their officials often sub- 
 ject to removal by the governor of the state. The patronage 
 of the cities, their best interests and everything that affects 
 them are thus made the pawns of state politicians, and what the 
 city might do to better itself, the politicians of the state usually 
 block. This they can safely do, as they come, with the excep- 
 tion of the small delegation of the city itself, from other parts 
 of the state whose votes usually hold them to no responsibility 
 for what has been done to undermine the city's progress. In 
 fact the rural voter is pleased, rather than otherwise, if his 
 representative takes part in a scheme to disappoint the ambition 
 of the city. 
 
 ]\Iany brilliant men of municipal renown, like Tom Johnson 
 of Cleveland, Sam L. Jones and Brand Whitlock of Toledo and
 
 118 THE PRICE OF INEFFICIENCY 
 
 Hazen S. Pingree of Detroit, with the best intereste of their 
 cities at heart, municipal patriots in fact, have worn out their 
 lives in attempting to gain from rural legislatoi^ permission to 
 do for the city what should be done. 
 
 It amounts to a most flagi*ant violation of the first principal 
 of American independence, the right of self government. Be- 
 sides producing bad results for all concerned, it has its ludicrous 
 features as well. 
 
 The "rube" legislators of New York State, for example, pre- 
 scribe the nature of the Sunday recreation which may be in- 
 dulged in by the inhabitants of New York city. What this may 
 degenerate into was well illustrated recently in a case over the 
 violation of the law against Sunday theatrical performances; 
 plays being prohibited while sacred concerts are permitted. 
 The vaudeville managers are among the most saintly denizens 
 of this mundane sphere, if we judge by the avidity they display 
 for giving ' ' sacred concerts ' ' in their theaters on Sundays. 
 
 In order to show the public the wonders of providence, as 
 an example to indolent humans, instances of the industry and 
 learning of the lower animal kingdom are frequently made a 
 part of such "sacred concerts" as, for example, tamed elephants 
 and mice and "Daniel" in the Lion's Den with real lions. 
 
 Among the wonderfully designed rules, however, by which 
 a theatrical performance is placed in the goat column and a 
 sacred concert in the lamb brigade, is the prohibition of costume 
 and changes of scenery and the use of a curtain. Thus in a 
 "sacred concert" a single setting is used, the curtain remains 
 up throughout the evening and the performers appear in their 
 street attire. 
 
 On one historic occasion, a comedian appeared wearing a 
 vest with prominent spots of purple. He was arrested on the 
 charge of taking part in a theatrical performance, namely of 
 appearing in costume. He denied the allegation and asserted 
 that the spots on his vest were merely an evidence of his per- 
 sonal taste. He wore them on the street that way because he 
 liked them large. The arresting officer declared they compared 
 in size with fried eggs but the comedian considered them as 
 representing plums. The controversy, thus, between the mighty 
 opposites of church and the amusement world, of rural restraint 
 and city liberty, resolved itself into a judicial interpretation of 
 the size of spots on a vest; the magistrate deciding that in the
 
 MUNICIPAL SOCIALISM 119 
 
 particular ease, though extreme, the comedian's taste was not 
 illegal. Thus was justice vindicated. 
 
 In New York, however, the city has reached a point where 
 its delegation in the legislature is almost as large as the rest 
 of the state combined. AVhen New York city gains the majority, 
 it will be the first city in America to have home rule, and to 
 control the state as well as itself. Provided politicial divisions 
 do not vitiate this control, the city, responsilile to itself alone 
 should make considerable progress, which now lies beyond its 
 legal powers. 
 
 American cities, too, have always lacked the political in- 
 dividuality of the European city. The American city is young. 
 It has not existed for centuries, as have most of the large 
 European cities, and there have never been times when an 
 American city Avas a sovereign power, as has been the case with 
 European cities in past ages. The American state has always 
 been the smallest sovereign. Even this was more theoretical 
 than real and existed only for a short time in the ease of the 
 original thirteen colonies a century and a third ago. The 
 American thus has had no occasion to feel any patriotic inter- 
 est in his city. No Philadelphian for example would ever con- 
 ceive taking up any more deadly arms against New York or 
 Pittsburg than a baseball bat. 
 
 In Germany, however, the remains of the former sovereignty 
 of cities are still seen as in Hamburg, Liibeck and Bremen, 
 where, as members of what was once the Hanseatic League, they 
 have individually representation in the Reichstag as independent 
 states \nth certain important exemptions and privileges. 
 
 The city in America is not thus the firm unit that it is abroad, 
 and not the rallying point of patriotism. The average Amer- 
 ican feels more pride in Washington as a city than he does in 
 his own town, and this lack of interest wall always work more 
 or less against the development of American cities. 
 
 Private ownership of public utilities, the great profits arising 
 from franchises of various kinds, principally street railway's, 
 and the letting of great contracts of construction to private 
 bidders, is the second cause that degrades city government in 
 the United States. 
 
 The merchants and business men interest themselves in secur- 
 ing from the city these valuable rights, and a large body of 
 the most aggressive men in any city, as well as outside capital- 
 ists, are generally interested either directly or indirectly in in-
 
 120 THE PRICE OP INEFFICIENCY 
 
 ducing the city to grant them the franchise, and in preventing 
 competitors from getting the prize. In this endless struggle 
 for franchises and valuable concessions, the officials of the city 
 having power to make the grants are subjected to every species 
 of influence, social, fraternal, political and financial, that can 
 be devised. Fights over franchises thus debauch the city 
 government, and distract attention from other necessities of the 
 city. 
 
 In Germany, where the cities largely operate their own pub- 
 lic utilities, no such condition exists, for the simple reason that 
 no rich franchise prizes are at stake. Public operation of pub- 
 lic utilities will undoubtedly prove for American cities, one of 
 the greatest blessings that can ever come to them, if properly 
 carried out. 
 
 And this form of municipal socialism will jjrove much more 
 of a success than it has when the system of longer tenures of 
 ofKce is applied, and the commission form of government more 
 generally adopted. The constant changes of administration 
 and personnel disorganize the forces of municipally operated 
 utilities, and thus play into the hands of capitalists, who desire 
 to continue the present system, by furnishing bad examples of 
 public operation. 
 
 A third cause of the lack of progress of American cities is 
 found in the high regard accorded the rights of private prop- 
 erty. The principle that a man's house is his castle is carried 
 to such an extreme that the castle becomes a mountain of in- 
 convience not to say of loss and damage to every one else. 
 
 In most American cities, a man may build any sort of house 
 that pleases him, wherever he may own or lease the land. This 
 unbridled liberty, or license, more properly speaking, has pro- 
 duced incongruous and heterogeneous cities principally dis- 
 tinguished as collections of buildings which are masterpieces 
 of ugliness. 
 
 Although this system or lack of system has produced the great 
 skyscrapers of New York and other large cities, evolving in an 
 artistic sense an architecture distinctively American, it has had 
 the effect of making American streets strings of unrelated struc- 
 tures in which all sense of beauty and proportion is lost. 
 
 It is a matter of wonder, passing through an American city, 
 where the hordes of utterly unfit architeets have come from that 
 have filled the land with such frightful examples of their art. 
 How the American can feel any interest in the purely util-
 
 T^IUNICIPAL SOCIALISM 121 
 
 itarian business buildings in which he transacts his affairs, or 
 any attachment to the conglomeration of rooms he calls his 
 home, is difficult to see. Indeed, it is surprising how he can 
 find the place he calls home, for on many streets whole blocks 
 of houses will either be duplicates of each other or in two 
 series of duplicates, each alternate house being similar, like 
 an endless sandwich with layers of bread and corned beef in- 
 definitely. 
 
 America is only waking up, only commencing to exist archi- 
 tecturally. Some of the sky scrapers and some of the public 
 and private buildings are good, but the taste of the public is 
 not yet formed. An ugly house is simply a house. It gives 
 no pain on account of being ugly, for the eye of the public is 
 uneducated and as little troubled by bad architecture as the 
 eye of the illiterate by bad spelling. 
 
 Mr. Ernest Flagg, designer of the Singer Building, and of 
 many other notable structures, in an article "Are American 
 Cities Going Mad Architecturally?" in the New York Times 
 of August 6, 1911, describes conditions truthfully when he 
 says: 
 
 "Our artistic sense is undeveloped. There is no great body 
 of amateurs here, such as is found in more refined communities, 
 who are capable of analyzing our productions and placing them 
 at their true worth. It is only a question of time, however, 
 when public taste will become more cultivated, and when that 
 time does come, there will be a great tumbling of reputations 
 which now stand high. 
 
 "Our architecture smacks too much of archaeology; it is not 
 modern; we use modern methods of construction and antique 
 methods of design. Why do not the people in the United 
 States recognize that every great work of art which has had an 
 underlying reputation was strictly modern when it was made? 
 No copy, or adaptation, no matter how cleverly done, can endure 
 the test of time and stand as a work of art. 
 
 "We are veritable barbarians in matters of taste, we ran- 
 sack Europe for old fragments which though they may be 
 charming in their original situation, become little better than 
 so much rubbish when set up in the midst of inharmonious 
 surroundings. We deck out our houses and gardens with these 
 things in precisely the same w^ay and with as little regard to 
 propriety as savages when they array themselves wath incon- 
 gruous objects which they obtain from European traders.
 
 122 THE PRICE OF INEFFICIENCY 
 
 ''The savages which Henry Hudson, on his second visit, 
 found wearing the hatchet heads he had sold them, as neck 
 ornaments, present no more comical picture than our art ama- 
 teur often does in his use of spoils from European churches 
 and monasteries. 
 
 "One sees gardens attached to shingled cottages, decked out 
 with marble seats, vases and fountains taken from Italian 
 villas. Houses in our cities are fitted out with fragments from 
 European palaces which are as much out of harmony with the 
 surroundings as a steam engine would be in a medieeval church. 
 Sometimes whole interiors have been taken from a European 
 building and set up here. Rich men's houses are turned into 
 museums, where there are as many styles as there are rooms, 
 all warring with each other and with the exterior of the build- 
 ing. 
 
 ""VVe have been having a very carnival of vulgarity, and an 
 ostentatious display of wealth and bad taste by people who 
 are regarded as leaders in refinement. 
 
 "In the midst of the chaos and confusion, with the public 
 taste at as low an ebb as it probably ever reached among peo- 
 ple who pretend to be civilized, with architecture for the most 
 part in the hands of men who had little training in, or knowl- 
 edge of, even the elementary principles of design, our new 
 methods of building were ushered in and we were called upon 
 to deal with a problem the proper solution of which called for 
 a more technical and artistic skill than we possessed. 
 
 "The time is at hand when the absurdity and bad taste of 
 our past methods will be fully understood and freely admitted. 
 We shall cease to wonder that cultivated foreigners are not 
 favorably impressed by our tall buildings, and will set our- 
 selves to work to make them as perfect and reasonably artistic 
 as they are ingenious and daring mechanically and construc- 
 tively." 
 
 The lack of artistic feeling for architecture has its counter- 
 part in not only other structures, such as bridges, docks and 
 terminals, but also in various kinds of designs where the utili- 
 tarian purpose crowds out every other consideration. Engi- 
 neers particularly design their works with little attention to 
 the beautiful and in the most important feature of modern 
 times, the rapidity with which the numerous discoveries in 
 science are applied to commercial purposes, be it for a peace- 
 ful gigantic liner, or a powerful and destructive dreadnought,
 
 MUNICIPAL SOCIALISM 123 
 
 or for a stupendous bridge structure spanning the Hudson or 
 Mississippi, or the housing of machinery for science and art 
 for the utilization of natural resources of the Niagara, or the 
 many other phenomenal power resources, all of which, with 
 thousands of others are monuments to modern sciences; there 
 is lacking in all the touch of artistry. 
 
 In order to have such engineering undertakings appeal to 
 the public or layman, it is essential to give them consideration 
 from the artistic standpoint, and this is doubly important when 
 such structures are to be located in the vicinity of a consider- 
 able community. To secure such effects it is advisable that the 
 engineer associate himself with an architect, as the engineer, 
 though a good statistician and mathematician, rarely combines 
 these qualities with architectural knowledge and particularly 
 with artistic feeling. 
 
 As these structures form an important feature in modern 
 practice, they should be of special interest to the architect as 
 being work for w'hich his particular training has made him 
 efficient, and if he is to maintain the traditions of the past, it 
 is necessary that he should take a like interest in the progress 
 of modern times, w^hich to the greatest extent is covered by 
 engineering skill, although this does not seem perfectly clear 
 to the mind of the layman. 
 
 While notable achievements are to the credit of the modern 
 American architect, and while numerous individual buildings 
 compare favorably with the best work of European architects, 
 the failure of American city architecture as a whole lies import- 
 antly in the fact that each building is designed for itself alone, 
 as if the eye of the spectator could see but one object at a time. 
 No attention whatever is paid to adjoining buildings, indeed 
 the architect seems to have taken a page from the writer of 
 advertisements who endeavors to have contiguous advertise- 
 ments as dissimilar as possible, thus attracting attention by the 
 harsh, not to say painful, contrast between them. There are 
 in New York and in other cities, numerous examples of build- 
 ings which have been designed with the idea of making them 
 "stand out" by being as complete and abrupt a contrast as 
 possible to the previously erected buildings. 
 
 The freedom accorded to private ownership has made such 
 monstrosities possible. 
 
 The German city, on the other hand, has gro-^Ti beautiful by 
 denying the right of the individual to disfigure the landscape
 
 124 THE PRICE OF INEFFICIENCY 
 
 at his own sweet will, on the only condition that he pays the 
 carpenter and the mason. 
 
 The city as a whole is planned, then its streets as wholes, 
 and the buildings then are permitted to be built only in ac- 
 cordance with the general scheme which has been laid out. 
 
 ]\Ir. Frederick C. Howe, an eminent authority on the subject, 
 in "City Building in Germany" in Scrihner's Magazine of 
 May, 1910, states: 
 
 "I know of no cities in the modern world which compare 
 with those which have arisen in Germany during the past 
 twenty years. There are none in Great Britain, from which 
 country official delegations are constantly crossing the North 
 Sea to study the achievements of the German city. There are 
 none in France, in which country the building of cities has 
 made but little progress since the achievements of Baron Houss- 
 man made Paris the beautiful city that it is. 
 
 "Important as is the honesty and the efficiency of the Ger- 
 man city, it is the bigness of vision, boldness of execution and 
 far-sighted outlook on the future that are most amazing. 
 Germany is building her cities as Bismarck perfected the army 
 before Sadowa and Sedan; as the Empire is building its war 
 ships and merchantmen; as she develops her waterways and 
 educational systems. In city building as in other matters, all 
 science is the hand maiden of politics. The engineer and the 
 architect, the artist and the expert in hygiene are alike called 
 upon to contribute to the city's making. The German cities 
 are thinking of to-morrow as well as of to-day, and the gener- 
 ations to follow as well as the generation that is now upon the 
 stage. Germany alone sees the city as the center of the civili- 
 zation of the future, and Germany alone is building her cities 
 so as to make them contribute to the happiness, health and 
 well-being of the people. This seems to be the primary con- 
 sideration. And it is unique in the modern world. 
 
 "Farsightedness characterizes Germany in all things. 
 Alone among the nations of the earth, Germam^ is treating the 
 new behemoth of civilization as a creature to be controlled, and 
 made to serve rather than to impair or destroy humanity. In 
 city building as in other things, Germany calls in her experts. 
 If they do not already exist, she creates them. Town planning 
 has become a science, just as much a science as the building of 
 engines. And it is treated as such. A school has recently 
 been opened in Berlin devoted to the subject. Exhibition of
 
 MUNICIPAL SOCIALISM 125 
 
 things municipal and congresses of various kinds are promoted. 
 There has grown up a substantial literature on city building. 
 There are experts like Stubben, Fisher, Gurlett and Baumeis- 
 ter, who go from city to city and consult with the local author- 
 ities on their projects. Nothing is haphazard. Nothing is left 
 to chance. The get-rich-speculator and the jerrj'-builder are 
 subordinated to the will of the community acting through its 
 permanent and expert body of city officials. 
 
 "The German city is being built on a scale of generosity 
 which halts at no expense. Its public school buildings rival in 
 splendor the best modern buildings of our great universities. 
 And the equipment is of the same order. I know of no public 
 schools, even in New York or Boston, that seem as costly in 
 their construction or more complete in every detail than those 
 of half a dozen German cities. They contain assembly rooms 
 and vestibules of the most artistic sort, while the gymnasiums 
 and provisions for recreation are equal to those of the best 
 schools iu America. And when we consider the relative poverty 
 of the German people and the burdens of taxation and arma- 
 ments, the attitude of our own cities toward these matters 
 seems positively parsimonious and niggardly. 
 
 "German cities recognize the controlling influence of the 
 land on the life of the communit}-, and they have become great 
 landlords. The town of Breslau, with a population about the 
 size of Cleveland, Ohio, owns twenty square miles of land, or 
 12,800 acres. But Berlin is the greatest landlord of all. That 
 city owns 39,000 acres, mostly outside of the city, while Munich 
 owns 13,000 acres, and Strassburg, 12,000 acres. German 
 cities also possess great forests and they are constantly adding 
 to their possessions. 
 
 "The motive of all this beauty, harmony, business enterprise 
 and foresight is so obvious to the German that he cannot com- 
 prehend why it should be questioned. "Whj^ does a merchant 
 erect a fine store-room or build himself a mansion?" he asks. 
 The German city thinks as an individual thinks about his busi- 
 ness and his home. A finished city attracts people. It brings 
 manufacturers and business. People choose a beautiful city 
 as a place of residence. Visitors make pilgrimages to it. 
 AVell-educated children make better citizens, better artisans. 
 The street railways, gas works, docks and other enterprises pay 
 their way. They even make money. But more than this, they 
 are a necessary part of the city, and of course they should be
 
 126 THE PRICE OF INEFFICIENCY 
 
 owned by it. If it be suggested that all this is socialistic, the 
 German business man shrugs his shoulders and says, "It may 
 be, but it is good business. " It is much better than good busi- 
 ness, it is good statesmanship." 
 
 At a meeting of the City Club, New York, December 4, 
 1911, the German Envoy, Count Von Bernstorff, tells how munic- 
 ipalities in Germany are governed and stated in part as fol- 
 lows : 
 
 "To be a Burgherr of a city in Germany, one must have a 
 definite and tangible interest in the community. In the theory 
 and practice of city government in Europe, a city has 
 always been regarded as a corporation which had business to 
 conduct and property to administer. According to this theory, 
 a distinction is made between the civil and political rights, on 
 one side, and on the other, what may be called municipal rights, 
 the right to take active part in administering city property and 
 determining city polic3^ As to the latter right, it is felt in 
 Germany that the people exercising it should have some evi- 
 dent stake in the corporation whose affairs they are called 
 upon to administer and control. 
 
 "The first thing that will strike a foreigner in German cities 
 is the number and variety of the functions with which, for the 
 benefit of the citizens, the public authority charges itself. 
 
 "In a modern German town, new streets are not the creation 
 of private enterprise. The town council lays out the streets 
 in accordance with the interests and needs of the whole popu- 
 lation. There are no restrictions as to the width of them or 
 of their construction. The council is in full control and can 
 do as it pleases. In this way, open spaces are distributed all 
 over the city. The council also decides what classes of build- 
 ings are to be erected. Some districts are devoted to factories, 
 others to mixed quarters, where both dwelling houses and work 
 shops may be erected, while the rest is set aside for a residen- 
 tial district. 
 
 "Most town councils not only supply water, gas, electric 
 lighting and power, and make a good profit in relief of local 
 expenditure, but also finance all the hospitals, treatment of 
 phthisis, and all the schools, including colleges for advanced 
 technical instruction. In most places the municipalities own 
 and work the tramways with very low fares and very high 
 profits; they maintain fire stations with the most advanced ap- 
 paratus and they have abattoirs regulated by veterinary science
 
 MUNICIPAL SOCIALISM 127 
 
 for the slaughter of animals for human food. In such cities 
 as Cologne, Frankfort and Manheim they manage enormous 
 docks for the accommodation of fresh water navigation ; they 
 maintain for the recreation of the citizens museums, picture 
 galleries, parks, playgrounds, baths, bands of music and even 
 theaters. 
 
 "The city of Frankfort, for instance, and the institutions 
 under its control, possess within its boundaries 12,800 acres of 
 land, that is, more than half the entire area of the city. Out- 
 side, the municipality owns 3,800 acres of land, making a total 
 of 16,600 acres. Of this, 8,500 acres are covered with wood, 
 which will probably be used for building purposes. The 
 largest part of the timber is produced by the municipal forest, or 
 Stadtwald, purchased from the German emperors at the end 
 of the fourteenth century. 
 
 "Now with reference to the provision of good and healthy 
 dwellings for the working classes, there are in Frankfort, as 
 in all large and ancient cities, a number of undesirable dwell- 
 ings. But the area in which these dwellings exist is con- 
 stantly decreasing, because the dwellings are being transformed 
 into offices. A great many old houses have disappeared, owing 
 to the laying out of new streets. These new streets, which cost 
 many millions of marks, were made chiefly to secure better 
 lines of communication, but at the same time they have im- 
 proved the housing conditions. The building regulations also 
 tend in this direction. At a very early period regulations ex- 
 isted which forbade the erection of unhealthy houses. 
 
 "Berlin, Cologne, Munich, Dresden and Frankfort are rich 
 in landed estates, which form a large part of the city's assets. 
 Leipsic is one of the cities which has devoted a portion of its 
 real estate to the housing of the working classes. That munic- 
 ipality has leased for a hundred years at a low rent to a phil- 
 anthropic building society, a large piece of communal land in 
 the environs for the erection of cheap houses. The majority 
 of the houses have to contain three and some of them more than 
 four rooms. This society cannot transfer its leasehold rights 
 to third parties without the consent of the municipality, and 
 in the event of doing so, both the offending contract and the 
 lease itself may be canceled. 
 
 "The munieipalit}'' undertook the initial construction of all 
 squares, roads and footpaths, and went further in undertaking 
 to advance money on mortgages for building purposes should
 
 128 THE PRICE OF INEFFICIENCY 
 
 the building society's revenues prove inadequate, with the pro- 
 vision that the society must refund the loan by regular repay- 
 ments in such a manner that on termination of the lease the 
 mortgage will be redeemed. 
 
 "The following is the method of town planning followed 
 by the municipality. First of all, a plan is made showing the 
 general scheme of the proposed new streets. The public is in- 
 vited to inspect the plan, and objections are received and con- 
 sidered by the body which has to sanction the plans, and which 
 is known as the Bezirksausschuss. 
 
 "Only after the plan has been approved are buildings per- 
 mitted to be erected. It is in the interests of the land owners 
 that the street plans should be approved, and it rarely happens 
 that sanction has to be refused to a plan on account of objec- 
 tions brought against it. Of course, the municipality could 
 not exercise this power of town planning unless they had the 
 power by expropriation. This power is given by law, and there 
 is no need to go to Parliament for special powers in a case 
 where expropriation is necessary. But as a matter of fact, it 
 is rarely used. 
 
 "Within the last ten years, the city of Frankfort has ex- 
 pended more than $50,000,000 in the purchase of land. In 
 German towns all works which have the character of a monop- 
 oly are to a great extent municipalized." 
 
 Municipal socialism, thus so far advanced in Germany, is 
 one of the large subjects of modern progress. Its ramifications 
 and advantages are both numerous and beneficial. A brief 
 summary, including some seventy-five items, of the principal 
 concrete lessons to be learned by America abroad, is given in 
 the New York World of October 1, 1911 : 
 
 STREETS; BILLBOARDS; PAVING; LAMP-POSTS; SEWAGE DISPOSITION. 
 
 1. In Berlin, Frankfort and many other German cities, 
 street advertising is practically confined to comer pillars. 
 There are no billboards erected on vacant lots to conceal refuse, 
 shelter vagrants and lower values. 
 
 2. The German capitals require that news-stands and street- 
 booths shall contribute to rather than mar the vista. 
 
 3. Paris has numerous isles of safety in the middle of its 
 streets, with artistic lamp-posts. These light both sides of the 
 street and reduce the number of lamps to two-thirds or one- 
 half the number needed where the posts are at the curbs.
 
 MUNICIPAL SOCIALISM 129 
 
 4. Belgium has a national society for the introduction of art 
 in the streets. Particular attention is paid to street fixtures 
 — lamp-posts, street-name signs, house numbers, tramway 
 stations, public-comfort stations, letter-boxes, fire-alarms, etc. 
 
 5. Practically all German cities save Hamburg have strict 
 regulations to prevent offensive illuminated signs, 
 
 6. The sewers of Paris are also pipe galleries, carrying tele- 
 graph and telephone wires, water pipes, pneumatic tubes for 
 letters and pipes for compressed-air service. 
 
 7. Glasgow has iron bins with hinged lids sunk along the 
 curbing and into these the street litter is brushed during the 
 day. 
 
 8. Vienna uses covered ash-carts. Curtains attached to the 
 frame are pushed aside while ashes are emptied, thus prevent- 
 ing the dust from littering the streets. 
 
 9. The German cities have ordinances which suppress most 
 of the street and waterside noises common to New York — the 
 flat car-wheel, the night-long shrieking of tugboats, the blatant 
 automobile horn, the scissors-grinder's bell, the peanut-vendor's 
 steam whistle, the cries of sidewalk merchants. 
 
 10. Traffic regulations have been so skillfully drawn and 
 firmly enforced in London that traffic now practically regulates 
 itself. 
 
 11. Cologne, Hanover and other German cities are well pro- 
 vided with waste-paper receptacles. They look more like vases 
 than garbage-cans, and are made of iron strips fastened to 
 lamp-posts or trolley or telegraph poles. 
 
 12. Paris is cleaned and scrubbed every day before it awakes. 
 Between 4 and 6 A. M. all the streets and sidewalks are swept, 
 and many of them washed and disinfected. 
 
 13. Paris fines householders who do not take in the emptied 
 ash-can by 7 o'clock. 
 
 14. Glasgow sweeps its streets at night. 
 
 15. Berlin has done best what most other European cities 
 have done well. At a cost of $30,000,000 it has constructed a 
 sewage-farms system covering an area almost equal to its own. 
 Barren heath land was acquired well beyond the corporation 
 limits and is being reclaimed by wastes which are pumped to 
 it from central stations. The farms return a considerable 
 revenue.
 
 130 THE PRICE OF INEFFICIENCY 
 
 MUNICIPAL THRIFT ABROAD; FUEL FROM STREET WASTE. 
 
 16. Stuttgart gets a revenue from its parks and other tree- 
 covered areas. These are under control of a forestry bureau 
 which obtains enough money from timber and firewood to 
 maintain lawns and paths, pay salaries and turn over 50 ^o of 
 its gross receipts to the city. 
 
 17. Amsterdam converts street wastes into fuel briquettes. 
 These are produced at $1.15 a ton and sold at $1.40, making a 
 profit of over $20,000 a year. Heretofore this waste has been 
 disposed of at an annual loss of $18,000. 
 
 18. When Frankfort lays out parks, boulevards or docks it 
 condemns land in excess of its needs and pays for the whole 
 enterprise by reselling the surplus and thus reaping the bene- 
 fits of the new values. There is no "honest graft" from "in- 
 siders' tips" as to land to be benefited. 
 
 19. According to Frederic C. Howe in the Scrihner's of 1910, 
 "there are 1,500 smaller towns and villages in Germany which 
 derive so much revenue from the lands which they own that 
 they are free from all local taxes. Five hundred of these com- 
 munities are not only free from all local taxes but are able to 
 declare a dividend of from $25 to $100 a year to each citizen as 
 his share of the surplus earnings of the common lands." 
 
 20. The cities of Continental Europe consider beauty a 
 municipal asset with a tangible cash value in that it makes life 
 more enjoyable, elevates the public taste and brings in tourists. 
 
 BEAUTY IN ELEVATED ROADS; CLOCKS IN STREET CARS. 
 
 21. In Dresden and other cities surface cars do not stop at 
 every corner. Stopping-places are about 220 yards apart and 
 are marked by a post and shield. This permits the making of 
 much better time. 
 
 22. In Berlin and most other German cities if you jump on 
 a street car in motion you are required to alight at the next 
 stopping-place. 
 
 23. Berlin's elevated roads are so designed as not greatly to 
 detract from the sightliness of streets. The posts and girders 
 almost realize Russell Sage's dream of an "ornamental iron 
 structure" and the most uncompromising parts are masked by 
 trees. 
 
 24. Berlin has so deadened the noise of passing elevated 
 trains by flooring the structure with masonry that in concert
 
 MUNICIPAL SOCIALISM 131 
 
 halls underneath one can listen with enjoyment to orchestral 
 music. 
 
 25. Bremen does not permit the street cars to carrj^ passen- 
 gers in their aisles and strictly limits the number on platforms. 
 
 26. Hildesheim and many other German cities have clocks in 
 all street cars. 
 
 POLITICS AND ADMINISTRATION; POLICEMEN WHO ARE TRUSTED. 
 
 27. Such is the dignity of London's County Council, such is 
 British public spirit, that Cabinet Ministers do not disdain to 
 sit in it. 
 
 28. The police of Plauen inspect the moving-picture theaters 
 twice a week and a majority of the school-teachers assist them. 
 
 29. When a policeman brings a prisoner before a London 
 Magistrate, "the Judge treats him as an impartial, honest and 
 fearless personification of the law of the land — practically con- 
 sults him as to what he thinks should be done with the defend- 
 ant in minor cases. . . . Here the policemen is the man 
 on trial." The words are those of William McAdoo, former 
 New York Police Commissioner, now head of the Board of City 
 Magistrates. 
 
 30. London largely separates the detectives from the uni- 
 formed force. As Mr. McAdoo says: "They are not even 
 known by name and cannot be located by the uniformed police- 
 man, and their names are certainly not bandied about by crooks 
 as common property." 
 
 31. "The honesty and good character of an ordinary London 
 constable," says Mr. McAdoo, "is taken to be as sure as that 
 of the Prime Minister." 
 
 32. Berlin and other German cities have bureaus of statis- 
 tics which enable citizens to obtain an up-to-date view of local 
 affairs. 
 
 33. The floating population of all British cities — "the lodg- 
 ing-house vote" — is practically disfranchised for municipal 
 purposes by the slight property qualifications required. 
 
 34. Glasgow has made street-sweeping, street-sprinkling and 
 garbage disposal part of its sanitary government and put them 
 under one jurisdiction. 
 
 35. Paris has placed under one department the care of the 
 parks and of the tree-shaded streets, the lighting of thorough- 
 fares and the erection and supervision of booths and kiosks.
 
 132 THE PRICE OF INEFFICIENCY 
 
 '' ADVANCED '^ SOCIAL LAWS; THE CARE OF PUBLIC WARDS. 
 
 36. Berlin has drafted nearly 4,000 citizens for poor relief. 
 These are divided into upward of 250 local committees and 
 every member is sponsor for specified families, with authority 
 to attend to their wants. No compensation is given to these 
 committees. Refusal to serve may be punished by tax increases 
 or the suspension of civil and political privileges. 
 
 37. Glasgow has women as domiciliary visitors, known as 
 "lady inspectors," who make suggestions as to cleanliness and 
 household reform to poor families. 
 
 38. After child-birth Swiss cities require a six weeks' cessa- 
 tion from work by women wage-earners. 
 
 39. Cologne has official visitors of the poor, one of whom 
 calls on every w^age-earning woman who has given birth to a 
 child. If the mother needs to go out to work, the fact is re- 
 ported and a grant of money is made on condition that she stay 
 at home and nurse her infant. 
 
 40. The general death-rate of illegitimate infants is twice 
 that of legitimate ones. Leipsic constitutes every illegitimate 
 child a ward of the municipality and its condition is inspected. 
 The death-rate of such infants is now even less than that of 
 legitimate ones. 
 
 41. Paris has nearly a hundred classes de garde for small 
 children whose parents are employed away from home. The 
 children are kept until their parents have returned from work. 
 
 42. Charlottenburg has established a hospital school in a 
 pine forest near the city for physically weak children under 
 medical treatment. Tables and benches are set out under the 
 fir trees and meals are served as well as lessons taught. 'M 
 marveled," said Sir John Gorst, "at the administrative ability 
 which had at so small a cost provided such a great portion of 
 health and happiness." 
 
 43. Glasgow maintains municipal wash-houses where for 
 four cents an hour a woman may use a stall with fixed tubs for 
 hot and cold water and appliances for steam boiling and dry- 
 ing. 
 
 44. Paris, like many other cities, has municipal pawnshops — 
 the Mont de Piete — with three large auxiliaries and above a 
 score of branches. These loan on an average $5 a year to every 
 man, woman and child.
 
 MUNICIPAL SOCIALISM 133 
 
 RAILWAY STATIONS WITH BEAUTIFUL SURROUNDINGS. 
 
 45. Paris has a belt railroad following the perimeter of the 
 city. This connects the various railroad stations, and both 
 freight and passenger traffic are facilitated. 
 
 46. The railway stations in German cities give upon plazas 
 of grass and flowers surrounded by hotels and municipal build- 
 ings so designed as to produce a single architectural effect. 
 
 47. Berlin, Dresden and other German cities study the 
 "winds and refuse to let factories locate in outlying districts 
 whence their smoke or odors might be blown into the city. 
 
 48. Diisseldorf has provided or regulated the designs for 
 factories, office buildings and department stores, and these are 
 ornamented with statues, frescoes and mosaics. 
 
 49. Paris and Brussels have improved advertising signs by 
 offering prizes for the most artistic. 
 
 50. Germany has developed a school of commercial architec- 
 ture headed by Alfred Messel. Wertheim's department store 
 and the Rheingold restaurant in Berlin and the offices of the 
 Allgemeine Zeitung in Munich are accounted in as good taste 
 as the best public buildings. 
 
 BEAUTIFUL RIVER BANKS WITHIN EUROPEAN CITIES. 
 
 51. Instead of using their rivers to carry off sewage, instead 
 of permitting unsightly commercial structures to occupy their 
 shores, European cities have treated the rivers as assets of 
 beauty and enjoyment. London has the Victoria Embankment 
 upon the Thames — a downtown riverside park. Paris has 
 lined the Seine •udth stone quays and faced it wdth public build- 
 ings and palaces. Cologne has occupied nearly all the Rhine 
 river-front with stone embankments and tree-bordered avenues. 
 Budapest has its river-front streets higher than the quays of 
 the Danube and these are lined with fine public and private 
 buildings. In the Briihl Terrace overlooking the Elbe, Dres- 
 den has "the Balcony of Europe." Berlin has built stone 
 quays along the Spree and planted the banks with trees. It 
 has made stone and cement walls for its canals. 
 
 52. The maritime cities of Europe insist that commerce shall 
 make terms with beauty on their harbor-fronts. Hamburg and 
 Bremen have handsome warehouses in a modified mediaeval 
 style The water-front of Antwerp and Stockholm is walled 
 with cement and stone. The quays of Havre are recreation
 
 134 THE PRICE OF INEFFICIENCY 
 
 centers and the buildings must conform to a general architec- 
 tural plan. 
 
 53. Hamburg gets its drinking-water from the Elbe. In 
 1893, following the cholera outbreak of 1892, it installed the 
 greatest filtration plant in the world, a system of subsidence 
 basins and filters. Water which before entering these basins 
 contained millions of cholera germs to the cubic inch emerged 
 as clear as a mountain stream. 
 
 54. Stockholm, Paris, Liege and Budapest have bridges with 
 architecturally imposing plaza approaches. 
 
 55. Dresden, Vienna and Amsterdam have introduced sculp- 
 ture into their bridges with a monumental effect. 
 
 56. Instead of making its show island an asylum for paupers 
 and criminals, Paris has on the He de la Cite its stateliest ca- 
 thedral, its central Courts of Justice, a great hospital, the Tri- 
 bunal of Commerce, the Prefecture of Police, &c. 
 
 GROUPED BUILDINGS; NEW STREETS; VINES AND FLOWERS; THE 
 
 CITY BEAUTIFUL. 
 
 57. European cities are discarding the checker-board street 
 plan. Paris led the way in Napoleon III.'s time when Baron 
 Haussmann, Prefect of the Seine, built great boulevards and 
 avenues by the hundred, laid out diagonal avenues between 
 important points and constructed engirdling boulevards. The 
 sum of $240,000,000 was spent in this work, and last year it 
 was decided to devote $175,000,000 more thereto. 
 
 58. London has done a similar but smaller work in King's- 
 Way. The German cities are following neither the checker- 
 board nor the radial avenue, ring-boulevard plan. Their new 
 streets wind perceptibly so as to open fresh vistas and permit 
 of collateral effects of parking and statuary. 
 
 59. Instead of locating their public buildings at random, the 
 capitals of Europe arrange them with relation to each other 
 and to some park, open space or boulevard, so that they eon- 
 tribute to one central effect. The finest is the Ring-strasse of 
 Vienna, and other notable examples are Berlin's Unter den 
 Linden and Lustgarten, Moscow's Kremlin, Dresden's Zwinger, 
 the Louvre region of Paris and the Grande Place of Brussels. 
 
 60. In Dresden citizens have undertaken to induce every 
 landlord and tenant to decorate yards, buildings and casements 
 with plants, vines, shrubs and window-boxes. The authorities 
 have co-operated by decorating municipal buildings, and at a
 
 IMUNICIPAL SOCIALISM 135 
 
 small expenditure the summer aspect of the city has been 
 transformed. 
 
 61. The color sense has been indulged in all Russian cities. 
 Building exteriors are of plaster to protect the brick from the 
 frost, and every year these are repaired and repainted, and 
 red, blue, buff, green, white and gilt diversified with mosaics 
 are successfully employed. 
 
 62. Every important European city has regulations restrict- 
 ing the height of buildings, the width of balconies, the projec- 
 tion of cornices, the size of windows, and the character of 
 lamps, signs, awnings, fences and doorways. 
 
 SCHOOLS OF TOW^N-PLANNING ; SAVING BEAUTIFUL FEATURES. 
 
 63. Ancient Athens and Rome set us an example of civic 
 centers in the Acropolis and the Forum. 
 
 64. Frankfort purchased a number of medieval buildings 
 near the City Hall and restored them to the original style, that 
 they should be in harmony with it. 
 
 65. Berlin has a school of town-planning. 
 
 66. Germany has experts like Stubben, Fischer, Gurlett, 
 Henrici and Baumeister, who give advice on townrplanning 
 and travel from city to city. It is a new profession — "Stadte- 
 bau." 
 
 67. Frankfort has built an exposition hall about the size of 
 Madison Square Garden. 
 
 68. Munich has a group of exposition buildings comprising 
 an auditorium, a theater, a hall for exhibits and a summer 
 concert garden. 
 
 69. When a new street is opened in Brussels or Paris prizes 
 running as high as $4,000 in Brussels and equal to one-half the 
 street tax in Paris are offered by the authorities for the most 
 artistic facades. 
 
 70. Vienna remits a percentage of taxes to landlords who 
 will tear down an old building and put up a bigger and better 
 one. 
 
 71. Copenhagen gives a prize every year to the architect who 
 designs the most sightly building and best harmonizes it with 
 older buildings about it. 
 
 72. Paris requires that all office and house fronts shall be 
 periodically repaired or repainted, so that the street shall ap- 
 pear neat and fresh. 
 
 73. All wide Paris streets are in effect parks. They have
 
 136 THE PRICE OF INEFFICIENCY 
 
 rows of shade trees. Many of them have a central park strip 
 planted with trees, grass and flowers, and benches are placed 
 here. Along chief streets are perhaps 100,000 trees, a large 
 number for a city so compactly built. 
 
 7-1. In practically all European cities pavements are kept 
 constantly in good repair. 
 
 75. All those European cities whose good government has 
 something to teach America are managed not by politicians but 
 by experts. 
 
 The civic pride of the citizens of American cities, so long 
 practically non-existent, is now growing and the spirit of the 
 movement is finding its greatest expression in the re-planning of 
 cities. 
 
 During the last two decades, and principally within the last 
 few years, some seventy-five cities have taken up the subject 
 and have prepared more or less elaborate plans, while in nu- 
 merous other cities the movement is taking form. 
 
 This means a greatly increased activity in building construc- 
 tion and the creation of a demand for a better class of build- 
 ings both architecturally and otherwise. It means a large 
 amount also of alterations and remodeling, and it is from 
 every point of view of the greatest importance to the public in 
 general. 
 
 To be familiar with city planning is a duty which the city 
 authorities, architects and engineers owe not only to them- 
 selves, but to the public, for even if they are not directly inter- 
 ested in the projects which may be put forward, the community 
 looks to them for guidance in forming its opinions on the sub- 
 ject. 
 
 In many of the cities which have undertaken city planning, 
 the plans evolved have been of the most elaborate and extensive 
 character, and the draughtsmanship with which they have been 
 prepared has made them beautiful objects of art. Unfortu- 
 nately, however, in many cases, that is all they are, and their 
 adoption in practice would be little short of a disaster to the city. 
 They are attractive but impracticable, and dangerous in the ex- 
 treme, not only to the cities which are tempted to adopt them, 
 but to the whole city planning movement, since important fail- 
 ures are certain to react upon and tend to discourage other cities 
 in their plans. 
 
 A city, considered in its essentials, is an apparatus of an
 
 MUNICIPAL SOCIALISM 137 
 
 operative character and a means of operation for those who 
 make use of its facilities. It is, in short, a depot and a dis- 
 tributing apparatus, and its principal functions are the hous- 
 ing of the public and the possessions of the public, their pro- 
 tection and distribution. The city is thus not only the static 
 mechanism of buildings but the dynamic mechanism of a dis- 
 tributing machine, and it is therefore necessary to consider it, 
 not only from the architectural point of view, but from the 
 engineering point of view as well. 
 
 City planning, consequently, in which full consideration is 
 not given to the engineering side, but in which only the archi- 
 tectural features are developed, are likely to be of doubtful 
 value, if not worse than valueless, for if put into effect, new 
 and unexpected difficulties would be encountered, which would 
 more than overbalance their desirable features. 
 
 It is therefore of the first importance for those having a city 
 planning project under way, to retain an experienced engineer, 
 as only in this way can safe and thoroughly practicable results be 
 obtained. 
 
 And the engineer selected must be a civic engineer, not 
 merely an engineer with the customary training, but one who 
 has the special training and experience necessary to consider 
 all the varied features of the city as an operative mechanism 
 and to take advantage of the most recent and advanced foreign 
 practice. 
 
 The great part played by engineering in city planning is not 
 fully appreciated, except by those who have had direct experience 
 in such undertakings. Among the primary engineering features 
 of city planning are water works, transportation systems, water- 
 ways and harbors, highway engineering, street lighting, sewage 
 and refuse disposal, gas and electric supply, police and fire alarm 
 systems, etc. 
 
 The laying out of the streets, squares and parks, and their em- 
 bellishment by architectural or landscape treatment, though im- 
 portant, are only the beginning of city planning. The installa- 
 tion of the necessary utilities and their efficient operation and 
 maintenance are of fundamental importance. 
 
 In the planning of a city, the architect and engineer should 
 not plan or replan separate portions of it, but should plan it 
 as a whole, with respect to the immediate requirements and to 
 the requirements of the future as well, and the most careful
 
 138 THE PRICE OF INEFFICIENCY 
 
 attention should be paid to the probable direction of its growth, 
 the presence of natural obstacles and of natural incentives to 
 growth. 
 
 City planning is not only a question of architecture and 
 engineering for it goes more deeply into the lives of the citi- 
 zens, affecting them in numerous ways with a degree of im- 
 portance that can only be realized by those who have made a 
 study of the subject. 
 
 The effect, on its citizens, of the building of a city in accord- 
 ance with the highest principles of the art of city planning 
 will be one of a remarkable betterment in their social, ethical 
 and physical condition. The superior appearance, beauty and 
 harmony of the city will develop artistic taste and will result 
 in increased civic pride and patriotism. This in turn affects 
 the character of the individual favorably, improving moral con- 
 ditions. The better hygienic system of the well planned city 
 provides more light, purer air and more healthful and less ex- 
 pensive living quarters, affecting the whole lives of the citizens 
 favorably. 
 
 The improved plan of the city, by providing safer and more 
 direct means of transportation, prevents accidents and saves 
 enormous amounts of time. The conveniently located parks, 
 recreation places, public baths, gymnasiums and play grounds 
 with ready access to woodlands and athletic fields, provides in- 
 creased opportunity for physical development. The proper 
 location of municipal markets affords cheap and wholesome 
 supplies of food. These factors, with convenient location of 
 schools, libraries, churches and other structures of a public 
 nature, all unite to place the life of the citizen on a higher 
 plane. A greater sense of responsibility is instilled while the 
 comfort and enjoyment of the individual is added to, and an 
 increase of population of a higher character effected. 
 
 The extent to which this improvement goes is far more than 
 is realized by the average observer. In Germany, where city 
 planning has reached its highest development, the results are 
 most remarkable. This is shown by a comparison of six cities in 
 Germany, selected at random, with six cities in the United States, 
 which had in 1880 approximately the same population. 
 
 Cincinnati has grown 16.1%, 27.7% and 42.8% respectively 
 in three decades, while Breslau's growth has been 22.8%, 
 54.9% and 87% during the same time. In the thirty years 
 Buffalo has increased 173.4% and Cologne 254.6%; New Or-
 
 MUNICIPAL SOCIALISM 139 
 
 leans, 56.9% and Dresden 147.1% ; Louisville 80.9%, and Han- 
 over 146.2% ; Providence 113.97c and Nuremberg 234.1% and 
 Kochester 144.1% and Chemnitz 237.1%. 
 
 The German cities have increased almost twice as rapidly as 
 the American cities, and while all this increase is not due to 
 city planning, a very considerable portion of it can be so as- 
 cribed. 
 
 The arrangement of traffic, canalization, location of factories, 
 the easy movement of products, the well nourished condition 
 and the ambition of employees furnish a powerful impetus to 
 industry. City planning justifies itself at every point, and 
 America is walking up to it in a wonderful way. 
 
 "Wliile the movement in its present recrudescence is recent, 
 the art of city planning is one of the greatest antiquity. The 
 remains of the earliest communal abodes of man, of however 
 primitive a nature, show a certain definite arrangement. With 
 the development of races, villages became towns and towns be- 
 came cities continually on a larger scale, and it is undoubtedly 
 true that the higher the degree of civilization of a people, the 
 greater will be the size of its cities. The civilization of the 
 Romans was largely expressed in the city of Rome, and the 
 glories of ancient peoples generally shown in their cities. 
 
 In the art of city planning, genius has occasionally arisen; 
 among the early masters being Merian and Canaletto, the for- 
 mer developing the general plan of the city and the latter 
 excelling in its interior arrangements. Sir Christopher Wren 
 in 1666 after the great fire of London, had the genius to re- 
 construct the city on a plan that would have made it one of 
 the most beautiful in the world, but he was ahead of his time 
 and London was permitted to grow up into the disordered 
 mass of streets and lanes that make it the greatest spot of con- 
 fusion to-day on the face of the globe. 
 
 L 'Enfant, however, who planned the city of Washington, 
 admittedly the most beautiful city in America and one of the 
 most beautiful in the world, enjoyed the double good fortune 
 of having the support of the founders of the republic and an un- 
 encumbered site upon which to build, while most city planners 
 have had to reorganize existing cities. 
 
 Equally fortunate was Baron Haussmann who rebuilt Paris. 
 He w^as given a free hand and a plan was developed, in which 
 conceptions of order, convenience, variety and grandeur were
 
 140 THE PRICE OF INEFFICIENCY 
 
 not allowed to be interfered with by any question of expense. 
 Great avenues were cut through labyrinths of streets and foul 
 and congested districts were replaced with parks and spacious 
 squares. Hundreds of millions were spent and Paris is still 
 spending gladly and with a lavish hand for extensions of his 
 plan. 
 
 The early masters, however, did not impart their theory, 
 leaving only their accomplished work as examples. Modern or 
 practical city planning, therefore, is a new art, based upon 
 principles, theories and practice only recently placed on a 
 scientific basis. The modern masters are Reinhard Baumeister, 
 the originator of the science of city planning, and Camillo Sitte, 
 the definer of aesthetic principles, while Joseph Stiibben is the 
 greatest of practical city builders. Their work is available in 
 theory, design and practice and will serve for future emulation 
 as it has served modern Germany so well as the basis of her 
 wonderful cities. 
 
 In the scope of practical city planning are included the 
 broadest principles and the fullest details. The leading ele- 
 ments are the plan of the city as a whole, the segregation in 
 suitable districts of the different classes of the population, and 
 their proper housing in classes of structures suited to their re- 
 quirements, the arrangement of such classes of structures in 
 groups and district units and the placing of such groups and 
 units in proper relation to the whole; the development of other 
 classes of units, such as civic centers, parks, public squares, 
 grounds, athletic and recreation fields and cemeteries and their 
 location with reference to their uses and nature; the supplying 
 of the units with the facilities and the public structures neces- 
 sary for the business to be transacted in them; the location in 
 civic centers of buildings suited thereto, both as to the uses and 
 their architectural qualities; the arrangement of systems of 
 transportation, the laying out of streams of traffic, location of 
 railway stations and bridges and harbor facilities; the system- 
 atic location of schools, libraries, churches, hospitals, insti- 
 tutions, theaters and other semi-public structures; the general 
 hygienic design of buildings and the system of city sanitation 
 and waste disposal; the laying out of adjoining lands, woods 
 and fields for purposes of recreation, the artistic regulation 
 of structures and street plans and the laying out of surround- 
 ing ten-itory, all in accordance with a settled plan, adapted to 
 fufiU in the best possible way the purposes intended and to
 
 MUNICIPAL SOCIALISM 141 
 
 take care of the growth of the city and prevent its abnormal 
 development. 
 
 The planning of a city, like the planning of anything else, 
 should be carried out with a view to the use which is to be made 
 of it, and to best adapt it to that use, and in addition to make it 
 as pleasing from an artistic point of view as possible. There 
 should first be strength in the design and if strength be eco- 
 nomically manifested, the artistic enrichment of the design will 
 be easily effected. 
 
 In city building, the strength of its design may be indicated 
 by its plan. Its streets and avenues should be broadly and 
 firmly laid out, advantage taken of its natural site and a sense 
 of unity caused to pervade the whole as a result of its unity in 
 structure. Its design should not be crowded, or its streets 
 narrow and at haphazard, nor should they be throughout of 
 such absolute uniformity as to destroy their individuality and 
 make the city merely a monotonous aggregation of streets, as 
 is so often the case in American cities. 
 
 A city should be planned and built with a breadth of view 
 and boldness of execution; it should be built more for the 
 future than for the present and its design should halt at no 
 necessary elaboration nor consider expense. 
 
 What the city is for should always be considered and the 
 most economical and efi'ective methods of reaching its aims 
 should be adopted, yet the fact that it is not merely utilitarian 
 should not be lost sight of. A city should not only be a place 
 of residence but an inspiration to its inhabitants and a worthy 
 object of their civic pride.
 
 CHAPTER XI 
 COMMISSION GOVERNMENT 
 
 Does popular government mean misgovernment? — A momentous revolution 
 in municipal government — Its origin in a catastrophe — Its rapid 
 spread — How the commission form of city government eliminates local 
 politics — The death blow of graft — Automatic good government — • 
 Earlier examples of commission government — Washington a notable 
 example — The autocracy of the whole — How concentration of responsi- 
 bility produces efficient government — Actual workings of the commis- 
 sion plan — Similarity to continental systems of national administra- 
 tion — Efficacy of the political inventions of the initiative, referendum 
 and recall — The direct primary — The passing of the boss — The efficient 
 Interstate Commerce Commission and the inefficient post office — 'The 
 absurdities of state legislatures — Irresponsibility of legislators — The 
 remedy — Official usurpation under the American constitution — Per- 
 nicious and sensational activity of law officers — The law a tissue of 
 loopholes — The constitution unable to cope with modern conditions — • 
 How it strangles the will of the people — Superior flexibility of European 
 governments — Neutral types of our presidents — How minorities rule — 
 The thick skinned office holder — Misrepresentative government — 
 Congressional abuses — A drastic remedy — Who really rules the United 
 States — How to do without a president and a congress. 
 
 Popular government has long labored under the criticism 
 that the interest of the citizen in how he is governed is so slight 
 that popular government means misgovernment. American 
 cities have been particularly pointed out as examples of the 
 failure of popular government, where, touching the citizen 
 most intimately, it should be most successful. 
 
 A new order, however, is coming in. Municipal government 
 is becoming a different thing, and the old reproach is being 
 wiped out with a celerity that is astonishing. The average 
 citizen is showing an interest in the way he is governed that 
 amounts to a passion and the lengths to which the new form 
 of government will be carried and the great services which it is 
 rendering and will continue to render to the public, are diffi- 
 cult to appreciate. 
 
 It amounts, indeed, to a revolution, and is a striking illus- 
 tration of the rapidity with which a desirable innovation, even 
 
 142
 
 COMMISSION GOYERNIMENT 143 
 
 in fundamental affairs, can be adopted, when it proves itself 
 of real value. 
 
 This new form of government is known as the "commission 
 plan" and in less than six years from its inception, has spread 
 to over a hundred and thirty American cities, meeting with the 
 greatest success. In twenty states it is optional with cities 
 whether they adopt the plan or not, and at the rate of progress 
 made and the satisfaction resulting from its adoption, it is 
 safe to say that tlie commission form of government will be- 
 come the exclusive method of city administration within a gen- 
 eration. 
 
 It is an illustration, also, of the vast difference between a good 
 system, which automatically works out desirable results, and a 
 poor system in which there are no incentives to efficiency and 
 no checks on inefficiency. 
 
 The commission form of government had its origin in a 
 catastrophe. It was an expedient, adopted in a great emer- 
 gency, and produced, like so many inventions, by necessity. 
 The Galveston flood left that city in a state of ruin, and the 
 ordinary forms of government were inadequate. Martial law 
 was declared and the necessity of the city continued so great 
 that at the request of citizens the governor appointed a com- 
 mission of five men to conduct the affairs of the city. Their 
 powers were practically autocratic, and they were selected be- 
 cause of their reputation and abilities. 
 
 It was time when necessity could not wait on politics, but 
 unrealized, the doom of the local politician was then and there 
 sounded, for when the time came for the commissioners to re- 
 tire, they were reelected and that form of government became 
 established permanently. 
 
 Its results were so good that neighboring cities, jealous of 
 Galveston's splendid showing, also adopted the plan, and a 
 distant city, Des Moines, Iowa, added desirable features and 
 gave such publicity to the plan and identified the city so much 
 with it, that it is often called the Des Moines plan and is largely 
 supposed to have originated in that city. 
 
 In reality the plan of government by a small board with 
 great powers, is one of the oldest and most effective of all 
 forms of government. Nothing new has been added to the 
 store of political wisdom by the device, but the applicability 
 and practicability of such a form of government to the Ameri- 
 can city had been previously overlooked.
 
 144 THE PRICE OF INEFFICIENCY 
 
 The commission form of government, in its most primitive 
 form, is in evidence among miners as a miners' meeting, in 
 which, being far removed from all laws, the miners resort to 
 law of their own, which has all the effect and vastly more effi- 
 ciency than ordinary law. Another example is seen in the vig- 
 ilance committee of the frontier cities, which was practically 
 what the Galveston commission amounted to. Emergency 
 methods, the effective stroke which manifests itself in times of 
 necessity, applied to ordinary affairs is what it resolves itself 
 into. 
 
 Japan is practically ruled by a commission form of govern- 
 ment, the council of Elder Statesmen forming the principal form 
 of government. The ancient Greek and Roman cities at times 
 were governed in much the same manner. 
 
 The city of Washington, long one of the best ruled cities, is a 
 city government under a commission, in this case appointed by 
 Congress. The city of New York, without realizing it, is be- 
 ing largely governed on the commission plan, the powers of 
 the aldermen having been taken away, and the principal source 
 of authority being in the Board of Estimate. Though lacking 
 detail, the present New York plan is much better than the old 
 system. 
 
 The originality of the present movement of commission gov- 
 ernment lies in the fact that the commission is elected by the 
 people instead of being appointed by some other source 
 of authority. It is in fact an elective bureaucracy, and is 
 achieving the admirable results of the bureaucracy of Ger- 
 many. 
 
 The rule of an autocrat, were the autocrat a perfect being, 
 would be the most desirable form of government. In a de- 
 mocracy, the rule is, so far as the individual is concerned, an 
 autocracy of all of his fellow citizens exercised through a sys- 
 tem of officials. The citizen of a democracy, however, has, in 
 feeling that he is a part of the autocracy ruling others of his 
 fellow citizens, a saving grace as compared with the subject of 
 a monarch, who is ruled by a power entirely outside of him- 
 self. 
 
 A democracy, being essentially an autocracy of the whole, 
 should achieve its best results when the system of government 
 is as nearly possible autocratic in operation, though demo- 
 cratic in selection of the ruling officials. The commission form 
 of government most nearly approaches such a condition, and
 
 CO^BIISSION GOVERNMENT 145 
 
 its great success as compared with the previous method is the 
 marvel of politics to-day. 
 
 While the plan of a mayor and numerous elected officials is 
 also a form of autocracy, it is one that has many broad avenues 
 of imperfection, the principal of which is scattering of power 
 and division of responsibility. It is a form of government, 
 too, in which the control of the public over the officials is so 
 vague and uncertain as to amount to no control whatever. 
 
 The number of officials elected is so great that the voters are 
 unable to remember their names, much less to have any definite 
 idea as to their fitness. After selection, the division of author- 
 ity is so complicated that public business when it is transacted 
 is accompanied with red tape and graft to an interminable de- 
 gree. 
 
 The great number of officials, as for example, a large board 
 of aldermen, causes each one to have but a small sense of re- 
 sponsibility. The vote of one alderman in a board of forty, 
 however much against the public interest it may prove, is 
 given with little compunction, as the grafting alderman, being 
 surrounded by so many others, has little fear of being singled 
 out for attack, and the voters have no effective means of rebuk- 
 ing his action. By the time election comes around again, they 
 have forgotten just who voted wrong, and as he may have 
 voted right on other propositions, the whole question becomes 
 so mixed that the protest is lost sight of, so many factors enter 
 into the election, that the wrath of the voters seldom reaches its 
 proper object. 
 
 But with the commission form of government, the reduction 
 in the number of candidates to five, enables the voters to find 
 out who they are and to remember what they have found out, 
 before election, and to exercise a control over the commissioners 
 after election. 
 
 This is effected by the scrutiny to which their acts may be 
 subjected, the meetings of the board being held in public dur- 
 ing the day, instead of behind closed doors at night, and who- 
 ever cares may be present. The newspapers report the meet- 
 ings and the conspicuous position of the commissioners and 
 the certainty of censure and effective censure is such that, 
 even when the members are professional politicians, as fre- 
 quently happens, they are compelled to pursue the proper 
 course.
 
 146 THE PRICE OF INEFFICIENCY 
 
 upon the members the whole force of public opinion and mak- 
 ing it certain that the responsibility for an act against the 
 public interest will quickly be placed. 
 
 The citizen has thus a target for criticism, and when there are 
 any complaints to be made, he knows to whom to make them 
 and who will be held responsible if conditions are not improved. 
 
 Each of the five commissionerships carries sufificient power 
 to make the candidate important to the voter. He informs 
 himself about the candidate and casts his vote with intelligence. 
 His vote becomes like a bullet, he can hit something with it, in- 
 stead of as before, merely shooting in a general direction. 
 
 The commissioners in their meetings being, so to speak, in 
 the spot light, are not without a certain self-consciousness. 
 They are often playing a role, that of a public official perform- 
 ing his duty properly, and while the part rests uneasily on the 
 shoulders of many who get into the commissionerships, it is 
 the only role possible under the strenuous circumstances in 
 which they are placed, for the meetings of small boards of 
 highly responsible officials are usually accompanied by acerbity, 
 not to say dissension. The characters of the five men, their 
 inclinations, ambitions and prejudices are magnified as if by 
 magic and the public gain a real view of their officials and 
 know who the responsible men are that make or mar the city's 
 progress. 
 
 The method of selecting the commissioners is such that poli- 
 tics is entirely eliminated. There are consequently no obliga- 
 tions of patronage to be met and the city's business is attended 
 to by minor officials selected for their fitness, a great advan- 
 tage at the outset. 
 
 The five commissioners are usually those of public affairs, 
 corresponding to the mayor; finance; public safety; streets and 
 public improvements; and parks and public property. 
 
 One of the main objects of this form of government is the 
 treatment of the city as a whole, its improvement and develop- 
 ment as a unit, rather than improvements in certain sections, 
 due to the influence of the alderman of that section, as in the 
 old order. 
 
 The cardinal principles of the commission system are the 
 centering of responsibility without too great centering of 
 power; the control of the public over the acts of its servants, 
 and the unification of all the powers of the city, both legisla- 
 tive and executive in a single small board.
 
 COMIVIISSION G0VER>OIENT 147 
 
 The details of the organization of the commissions and the 
 method of selection of commissionei-s vary in different cities. 
 In the Des Moines plan, the distinguishing features are the 
 initiative, referendum and recall, and the non-partisan pri- 
 mary. The initiative is a provision whereby a petition being 
 signed by a certain number of citizens and being presented to 
 the board for action, goes before the public if the board fails 
 to pass it. The referendum is similar in operation, that is 
 where a certain number of citizens object to an ordinance, it 
 must be rescinded or taken before the public at a general elec- 
 tion. The recall provides for submission of the continuance in 
 office of any commissioner, to the vote of the public on the de- 
 mand of a certain number of citizens. It is the referendum 
 applied to the commissioners personally. Both the recall and 
 the referendum are similar in principal to the cabinet form of 
 government in European countries, in which the cabinets, los- 
 ing votes of confidence in parliaments, resign. 
 
 The non-partisan primary is a sort of eliminating prelimi- 
 nary election. No party emblems are allowed and the ten high- 
 est names become the candidates for commissionerships at the 
 subsequent election. In the city of Grand Junction, Colo., 
 the primary is superseded by the preferential ballot, in which 
 the voter indicates his first, second and third choice, thus saving 
 the expense of the primary election, which is entirely dis- 
 pensed with. 
 
 It is obvious that this method of selecting the commissioners 
 eliminates the political machine in local politics. A corpora- 
 tion seeking a franchise can be of no service to a candidate 
 save by a house to house canvass of the voters previous to the 
 primary, an expedient of doubtful value. The grip of the 
 politician is broken, because the public is too numerous to be 
 "delivered" and because, after election, the referendum and 
 recall can so readily stop graft, jobs, jokers and deals. 
 
 Then, too, the candidate, owing no allegiance to an organiza- 
 tion seeking a franchise, can be of no service to a candidate 
 and is not obliged to make appointments at the behest of a boss, 
 and added is the fact that there are no minor offices to be filled 
 by election, which reduces the places to be filled, and wdthout 
 places there is little room for politics. 
 
 The effect of the commission form of government has been 
 uniformly good. Indeed it is the custom now for cities having 
 such a form of government to advertise that fact among their
 
 148 THE PRICE OF INEFFICIENCY 
 
 other advantages in attracting new population and manufactur- 
 ers. 
 
 The following examples of the improvement effected by the 
 commission form of government, taken at random, show the 
 remarkable efficiency of the system. 
 
 In Keokuk, Iowa, the commission plan went into effect in 1909. 
 At that time the city treasury was empty and there was a float- 
 ing debt of 20% of the annual revenue of the city. After six 
 months commission government, the city began operating on a 
 cash basis and the bonded indebtedness decreased by $39,000. 
 More than double the amount of street improvements made in 
 the corresponding six months of the preceding year was made, 
 while for less than one half of the results accomplished in the 
 street department this year for $11,500, the city paid last year 
 $14,000. It had been the custom to borrow from $25,000 to 
 $30,000 to "carry the city over" from the beginning of the 
 council year to tax paying time in August. On that amount the 
 city would pay 5% interest. This year the commissioners did 
 not borrow. Instead of paying interest they managed to keep 
 a cash balance in the city depository on which the city realized 
 interest. 
 
 In Kansas City, Kansas, the commission plan went into effect 
 in 1910. When the new regime commenced, it was found that 
 a deficit of $40,000 in the annual expenses was imminent. By 
 energy in collecting licenses, dog taxes, taxes on street cars and 
 telephone poles, $16,000 more was collected in the nine months 
 than in the previous year. Cutting out superfluous city em- 
 ployees and economizing reduced the expenses sufficiently to 
 enable the Commissioner of Finance to promise that the city 
 would be free from debt in the first year. 
 
 In Berkeley, California, the commission plan went into effect 
 in 1909. Interest in public affairs has been greatly increased. 
 Daytime meetings of the council are well attended. Adminis- 
 trative matters are more widely discussed on the street than ever 
 before. The idea of the old line political divisions which always 
 dominated the city, seems entirely to have disappeared in munic- 
 ipal affairs. The city is overwhelmingly republican, but a 
 socialist mayor was elected in 1911. 
 
 Of the results of the commission form of government, John 
 J. Hamilton in his "Dethronement of the City Boss," says: 
 
 "Every city has its own story of deficits wiped out, floating 
 debt taken up, bonds retired, business methods introduced, long
 
 COMMISSION GOVERNIMENT 149 
 
 stancTinG: nuisances abated, laws enforced, books better kept, 
 streets kept cleaner, public works more honestly constructed, 
 public buildinfirs erected, additional parks and playgrounds ac- 
 quired, economies enforced and taxes reduced — one, all or 
 many. All report a Revival of public spirit and improvement 
 in business resulting from better civic conditions. 
 
 "There is no variation in the character of the reports; every- 
 where it is the leaks stopped, system talcing the place of chaos, 
 efficiency substituted for poor service, promptness for hopeless 
 procrastination, lower for higher tax levies, or better values 
 received for the public outlays. That which most commends 
 the plan is the optimism which it brings back into our munic- 
 ipal politics." 
 
 The success of the commission form of government for cities 
 stimulates interest in politics and proves that the public can 
 attend to its own affairs when it can find a system that will 
 enable it to do so in a practical manner. 
 
 The small board of commissioners has in other fields also 
 proved its great value. The Interstate Commerce Commission 
 of the United States is a highly effective body, which performs 
 its duties without criticism, and which Avields a vast power. 
 Yet it is a body within the law, and acts consistently in a legal 
 manner. It is in contrast to the Post Office Department which 
 also has vast powers, but of an autocratic, not to say extra- 
 legal nature. Though it comes in contact more intimately and 
 more frequently with the public than any other department, 
 the post office is as far removed from popular control as it 
 might well be. 
 
 In it power is centered and responsibility to the public sev- 
 eral steps removed. There is no method whereby the public 
 can express its will in reference to the Post Office Department, 
 or in fact in reference to any department of the government, 
 and tlie power of the department head is, for practical purposes, 
 unlimited. The violent contrast between the waste and ineffi- 
 ciency of the post office department, and the results of the 
 administration of cities under the commission fonn of govern- 
 ment, suggests the advisability of a change in the administra- 
 tion of the departments of the government. 
 
 In New York and other cities, the public service commissions 
 and commissions of other natures, possessing large powers, use 
 them in the interest of the public. The efficiency of these 
 bodies is due to the same causes as the success of the commis-
 
 150 THE PRICE OF INEFFICIENCY 
 
 sion form of government; that is, the small number of com- 
 missioners, the consequently conspicuous positions which they 
 occupy, and the unification in them of more than one kind of 
 power. In the commission form of city government, the com- 
 missioners have legislative and executive powers. In the In- 
 terstate Commerce and various public service commissions the 
 powers are judicial, legislative and executive, that is, the com- 
 mission hears evidence, makes orders which have the effect of 
 laws, and then enforces them. 
 
 From the success of the commission form of city government, 
 there would appear to be no good reason why a state govern- 
 ment could not be conducted more successfully in the same 
 manner. At present the system of legislatures and a governor, 
 while not producing results as bad as the ordinary city govern- 
 ment, is not much removed from it. There is the same division 
 of responsibility and scattering of power, and legislators, being 
 numerous and vastly inconspicuous, feel little concern over 
 voting for improper measures. 
 
 The substitution of a state board of five governors, instead 
 of one, with the abolition of the legislature, could not work 
 much worse than the present system, and there is every reason 
 to suppose that it would work vastly better. It would cer- 
 tainly eliminate the freak and ill considered legislation now so 
 prevalent. 
 
 In the west, where conditions and traditions are less binding 
 than in the east, the experiment is more likely to be tried. It 
 should not be a long step for a state already filled with com- 
 mission governed cities, to become a commission governed state. 
 
 In the framing of the constitution of the United States, the 
 three powers of the government, the legislature, the executive 
 and the judicial are distinctly set apart and the prerogative of 
 each are carefully guarded, the assumption being that abuses 
 would arise were any of these powers to be exercised conjointly 
 by one set of officials. The framers of the constitution were 
 near times of the oppression of monarchs and their principal 
 care was to const nict a form of government in which official 
 encroachment would not destroy the liberties of the people. 
 
 Though they framed a document which has withstood the 
 wrack of time for a centurj'^ and a third, it has proven far from 
 a perfect system of government ; in fact, it is a system that is 
 cumbersome, inelastic, unresponsive, indirect, tedious and sub- 
 ject to a great number of abuses. In fact, the American has
 
 COMMISSION GOVERNMENT 151 
 
 less real liberty than the subject of a modern monarch, and 
 oiSeial usurpation in enlightened countries flourishes nowhere 
 as in America. 
 
 The citizen is liable to arrest and seizure at the whim of 
 agents of the government, and from this he has no practicable 
 redress. Arrests are vastly more numerous than necessary and 
 are made in a spectacular fashion, and the whole energies of 
 the departments devoted to securing convictions to save their 
 faces. 
 
 The powers of the government in its inquisition into private 
 affairs are quite unlimited, and a system of espionage exists in 
 the post office department, whereby the mail of any person may 
 be opened at will, not excepting the mail of the president him- 
 self. The powers of the government are not exceeded by 
 those of any constitutional government. 
 
 In America a man may be imprisoned for intending to com- 
 mit a crime (using the mails with intent to defraud), a case so 
 extreme that other governments do not extradite fugitives for 
 this crime. In addition, various societies are licensed to prose- 
 cute violators against certain laws, a system as pernicious as 
 the informers of the Roman times. 
 
 The American thus suffers arrest and is brought to trial with 
 its great expense, with greater frequency and less justification 
 than in any other civilized country. 
 
 On the other hand real offenders plead technicalities and 
 escape just punishment if they are well supplied with means, 
 more readil}^ than elsewhere, and the processes of the law are 
 so expensive and long drawn out, that the citizen who appeals 
 for justice finds it a long, expensive process. 
 
 Thus America is largely a lawless country, with less real 
 liberty and more flags per inhabitant (as shown by the statis- 
 tics of flag manufacturers) than any similar countiy. 
 
 The framers of the constitution took themselves with great 
 seriousness. In fastening the constitution as it is upon the 
 country, they took great pains to make its amendment exceed- 
 ingly difficult. They seemed to assume that liberty lived and 
 died with them, that they were bequeathing the blessings of 
 freedom to future generations, who without their pains would 
 othenvise be unable to obtain it. Indeed, they exercised, as is 
 the way with statesmen, an over zealous regard for posterity. 
 
 Bismarck is credited with the cynical remark: "Let us 
 leave a few reforms for the next generation to solve." Such
 
 152 THE PRICE OF INEFFICIENCY 
 
 was not the attitude of the framers of the American constitu- 
 tion. They were building for all time, in their own opinion. 
 
 It does not appear, either, that in endeavoring to provide the 
 republic with a just constitution they took any special pains to 
 do justice to those from whom the principal ideas came. A Phil- 
 adelphia merchant, Pelatiah Webster, is credited with having 
 been the chief source of the ideas embodied in the constitution, but 
 no credit was accorded him by the framers of the document. 
 
 That the political wisdom of this merchant, however, 
 based on the writings of theorists and the limited experience of 
 other republics, was not adequate to the task, is shown, for ex- 
 ample, by the process of electing a president by electors, a pro- 
 cess which has no vitality whatever, and is followed only in 
 form and not in effect. While nobody in the United States 
 has ever voted for a president, but always for the figure heads 
 known as electors, the electors have never exercised the real 
 power that it was intended to confer on them, that of actually 
 selecting the president. Instead, political parties nominate 
 candidates for president, and electors are pledged to vote for 
 such persons prior to election. Only in the case of the death of 
 a candidate for president after election and before the meet- 
 ings of the electors, would they exercise the powers which they 
 possess according to the constitution. 
 
 The intention to have the vice president a man second in 
 ability to the president failed to work itself out, the system 
 really coming into force being such that only men of inferior 
 ability will accept a vice presidential nomination. The result 
 is that when a vice president is elevated to office, he is only a 
 freak of politics. It was the idea of the framers that the man 
 second in choice among the electors should be the vice president, 
 that is, the defeated candidate for the presidency. 
 
 The irruption of political parties, however, automatically 
 produced by the constitution without having been intended, 
 caused such a plan to mean an entire change of policy in the 
 government, and a defeat of the will of the majority on the 
 death of a president by installing his opponent, and thus it 
 was soon relegated to the alphabet of dead letters. 
 
 The system of government and the partisan methods of selec- 
 tion of presidents, do not result in the selection of the best men 
 for the presidency, nor the men the public would prefer. The 
 constitution is imperfect thus, in that it is not a means whereby 
 the will of the people can be expressed; indeed it continually
 
 COMMISSION GOYERN^IENT 153 
 
 defeats and eireiimvents the will of the people, and offers no 
 means whereby the will of the people can be expressed definitely 
 on any given subject. 
 
 There is a well grounded suspicion that the framers of the 
 constitution were influenced by motives which are now ascribed 
 to the "interests." In those days men of wealth occupied high 
 positions on that account alone. Washington was a man of 
 great wealth, and the demarkation that now exists between 
 capital and labor was not so sharply drawn. The constitution 
 as it exists is an instrument under which the pursuit of wealth 
 may be cai-ried on to the greatest possible advantage, and it is 
 reasonable to suppose that the Philadelphia merchant had such 
 a consummation in view when he took a hand in the framing 
 of the document. 
 
 The principal defect in the operation of the constitution is 
 that exhibited in city governments under the same plan, the 
 scattering of responsibility and the concentration of powers at 
 points where they are not accessible to popular control. 
 
 The division of the legislative and judicial powers results in 
 laws being passed by one body and passed upon by another 
 knowing nothing about the intentions and desires of the legis- 
 lators, and only able to enforce the law as it reads. This pro- 
 duces an enormous growth of technicalities and no end of in- 
 justice, because the law makers have made their law and gone 
 and the judges have no option but to enforce it and no means 
 of avoiding the absurdities that arise. If the law making and 
 judicial powers were united in a single body, those responsible 
 for its absurdities would come in contact with them in its en- 
 forcement and would then be compelled to eliminate them. 
 
 In most constitutional monarchies and in other republics, 
 the cabinet expresses at all times the will of the people and is 
 usually composed of the most eminent men, not the second 
 raters that get into American cabinets. Should their views be 
 out of accord with the majority, the cabinet falls and a repre- 
 sentative cabinet replaces it. Such a cabinet is a living thing 
 and a real power. The American cabinet, however, is only a 
 collection of political obligations, without any political flexi- 
 bility, expressing nothing and standing for nothing. To call 
 them cabinet ministers, even, is ludicrous. Yet they have al- 
 most unlimited powers in their own departments, without any 
 responsibility, save to the whim of the president. 
 
 In European countries, should the administration and the
 
 154 THE PRICE OF INEFFICIENCY 
 
 cabinet feel that they are right, in the face of a hostile assem- 
 bly the ruler or president may dissolve the assembly itself and 
 go before the country for a new election. The public thus has 
 a means of expressing itself on any topic of sufficient importance 
 to warrant it, at any time and at the right time. 
 
 The American public has no such opportunity. Elections 
 are held at fixed periods, irrespective of vital questions, and 
 great disturbance of business has thus to be undergone period- 
 ically without any great questions being decided as such; the 
 only thing being decided being the persons returned. What the 
 issues of these periodical campaigns will be, can never be told 
 in advance, and definite decisions on the policies of the countiy 
 are formed with great difficulty, and usually not at all by the 
 public, unless of the greatest importance. 
 
 The administration must go before the public on its record 
 as a whole, and approval or disapproval of parts can only be 
 approximately determined; indeed a president may be elected 
 on the strength of his personality, irrespective of issues. 
 
 Thus the dominant party may continue a great number of 
 small abuses in effect, which are quite beyond remedy by the 
 public, since questions of greater policy overshadow them. 
 Thus the ruling party carries many abuses, and is wrong 
 and out of the spirit of the times on many questions, but owing 
 to the prominence of its leading issues it continues in power. 
 
 A ruling party finally, however, becomes so overgrown with 
 abuses that they sink the political ship, the minor abuses in 
 the aggregate being more important than the main issue, and 
 the new party cleans the political house. Self interest can thus 
 manifest itself in political actions, up to about 49% of 
 the party actions. This is the main cause of American mis- 
 government and governmental inefficiency. 
 
 The system of the selection of the candidates for president 
 is such that the strongest men of the country, having by their 
 strength aroused animosities and jealousies, are unable to 
 secure the nomination, and compromise men are selected, chiefly 
 distinguished for not being objectionable to any faction. 
 
 A sort of harmless type of person thus has the best chance 
 of becoming an American president, and it is a fact that the 
 presidents of the United States have been, during its history, 
 by no means its leading men. This is a fault of the constitu- 
 tional system which is held in such absurd veneration. Almost 
 fanatical are those who hold the tenets of the separation of the
 
 CO]\miSSION GOVERNMENT 155 
 
 legislative, judicial and executive functions, and that repre- 
 sentation should be local in nature. 
 
 The result, however, of the separation of the powers, is a 
 highly cumbersome and inefficient organization. The laws 
 passed by congress are usually written by some one man in a 
 committee, or a friend of his, and careful and mature delibera- 
 tion of them by the whole congress is a physical impossibility. 
 The government is thus a government by secret committee, and 
 the laws are actually drafted by outside interests, those seeking 
 favors and men with hobbies. It is stated that the Aldrich 
 plan for new banking legislation was really drawn by a mem- 
 ber of a prominent banking house in New York. In whose 
 interest such a law would be it is easy to imagine. It is only 
 another example of the old Philadelphia merchant plan of legis- 
 lation. 
 
 After a law is passed, a long wait ensues before the courts, 
 in reality the dominant branch of the government, through 
 outliving the presidents by whom they are appointed, through 
 their small personnel, and the great powers vested in them, de- 
 cide w^hether the law is constitutional or not. 
 
 The power of the court is so great that it practically legis- 
 lates any disputed point, but the long delay before the matter 
 can be adjudicated, causes loss and stagnation at every turn. 
 
 Another of the great defects of the present system is that the 
 country is ruled as a collection of parts, and not as a whole. 
 As has been described, each congressman is for his own locality, 
 and his own personal interests. The result is that the country 
 is governed as a collection of units, the resultant of discordant 
 forces, negatively so to speak, rather than as a whole, the 
 resultant of general tendencies and for the general good, posi- 
 tively. 
 
 The effect of this congressional representation by districts is 
 to repress the will of the people in that it makes the establish- 
 ment of new political parties almost an impossibility, and prac- 
 tically denies representation to large minorities. 
 
 Unless a new political party is strong enough to muster a 
 majority in a congressional district, it has no representation in 
 congress whatever. If for example, there were 35% each of 
 republicans and democrats in the United States, and 30% of 
 a new party, the new party would have no representatives in 
 Congress unless its members segregated themselves by moving 
 into certain districts previously agreed upon.
 
 156 THE PRICE OF INEFFICIENCY 
 
 But if, for example, there were 25% of republicans, 20% of 
 democrats, 20% of socialists, 20% of prohibitionists and 15% 
 of populists, generally distributed over the country as a whole, 
 as is usually the case, fully three-quarters of the voters would 
 be deprived of representation. 
 
 AVhile this condition does not obtain at present, yet the large 
 socialistic and prohibition parties which have cast a large vote 
 throughout the country for years, have had practically no rep- 
 resentation in congress, and have no prospect of effective repre- 
 sentation unless they become dominant parties. 
 
 Certainly a system thus, under which it is impossible for a 
 large proportion of the voters to have representation, is far 
 from perfect. Even corporations do not treat their stock- 
 holders as badly, and the constitution might take a much needed 
 lesson from the by-laws of the trusts, and establish cumulative 
 voting. This would be accomplished by allowing the voters to 
 vote at large for their congressmen, that is a resident of one 
 district might cast his vote for a candidate in some other dis- 
 trict. By agreement, the voters of a party over all the United 
 States could concentrate their votes on candidates in certain 
 districts, thus insuring a proportionate representation of min- 
 ority parties in congress. 
 
 The effect of such a plan, allowing for example, prohibition- 
 ists in Indiana to vote for a congressional candidate in Georgia, 
 and socialists in New York to concentrate on a socialistic can- 
 didate in Wisconsin, would have a profound effect. It would 
 enable numerous new parties to spring up as if by magic, and 
 the individual voter could vote on the subject which he deemed 
 of the greatest importance, instead, to have his vote effective, 
 of being compelled to vote either the republican or democratic 
 tickets, standing for many things with which he has no sym- 
 pathy along with the things he votes for. 
 
 It would make congress a true index of the will of the people 
 and would break the' grip of the politician so long held through 
 the bi-partisan system now automatically produced by the 
 method of selecting congressmen under the constitution. 
 
 The framers of the constitution did not contemplate the two 
 party government which resulted from their document, in fact 
 they had quite a different scheme in mind, but the system pro- 
 duced the two party method and there will never be a third 
 party of any consequence as long as the present constitutional 
 provisions of election by districts is continued.
 
 co:mi^iission govern^ient 157 
 
 The plan of voting thus for congressmen at large could be 
 operated in the states separately, without applying to the whole 
 country, and still produce great effects, since in the more popu- 
 lous states, the concentration of votes in certain districts would 
 he sufficient to effect the election of respectable representations 
 for the various new parties. 
 
 A further advantage of the cumulative plan would be the 
 smashing of the "pork barrel." Congressmen elected at large 
 would be under no obligation to the voters in their districts, and 
 not expecting reelection from them, would not attempt to 
 curry favor by securing special appropriations. Being elected 
 at large, there would be no occasion or even possibility of a 
 system of patronage, as such representatives would serve the 
 whole interest of the country, rather than those of certain dis- 
 tricts. The country would thus be governed as a whole, or 
 in the state mentioned, as a group of states, rather than as an 
 aggregation of small parts, each striving for its own interest. 
 
 In Germany, although the rule of representation by districts 
 is similar to ours, there are numerous parties in the Reichstag, 
 due to the habits of the German people to segregate themselves 
 in districts. Thus in a town, the Catholics will usually live in 
 one section and the Protestants in another. Socialists are 
 found congregated in industrial districts and thus each is pro- 
 portionately represented. Unless Americans localize their 
 abodes according to their political faiths, the present inequit- 
 able plan vrill continue to prevail. 
 
 In Germany a candidate may ran in two different districts, 
 thus being sure of election in one. If he carries both, he has 
 the option of saying which one he will represent, and an after 
 election is held in the other. In England elections are not held 
 simultaneously, and a candidate for parliament defeated in one 
 district may run in another later. 
 
 Thus the real leaders of the party are sure of reelection, 
 while in the United States the best and brightest men are con- 
 tinually being retired through narrow majorities in the dis- 
 tricts in which they live. 
 
 The American plan, too, requiring the residence in the dis- 
 trict represented, has the effect of producing a fever of politi- 
 cal activity all over the country, and of stirring up political 
 ambitions in all sorts of men, desirous of distinction but un- 
 qualified for legislative duties, who might better be left in 
 obscurity in favor of the real leaders of thought and action
 
 158 THE PRICE OF INEFFICIENCY 
 
 who cannot be expected to scatter themselves in remote districts 
 for the sake of political advancement, but who under a better 
 system could remain in centers of civilization and progress, and 
 still be of great value in the councils of the nation. 
 
 The very low grades of men generally found in the minor 
 positions of American politics would thus be largely eliminated. 
 Of particular value would be the dispensing with the thick 
 skinned office holder, who makes a desperate fight for his office 
 when he meets with criticism. 
 
 The American office holder as a rule, has no such sense of 
 honor and propriety as is produced by other governmental sys- 
 tems in their office holders, who when questioned immediately 
 tender their resignations. They thus demand almost unani- 
 mous support and receive it as long as they remain in office. 
 Thus both the office and the official is respected. In America, 
 the caliber of office holders is such that it is a popular saying 
 that though some are fired and some die, none ever resign. 
 
 A further defect in the governmental system of the United 
 States lies in the fact that the candidate receiving the largest 
 number of votes in the electoral college for president, may not 
 be the one receiving the largest number of votes of the voters, 
 a direct defeat of the will of the people. 
 
 While congress has not developed the graft and corruption 
 of legislatures and aldermanie bodies, it is because the congress- 
 man is actually, though not relatively, more conspicuous, and 
 because the great size of the assembly makes the task of the 
 briber much more difficult. In addition, congress is not a 
 franchise granting body in the ordinary sense, though the in- 
 fluence of the protected manufacturers is so great as to amount 
 practically to corruption. 
 
 Congress is notorious for log rolling. It is highly inefficient 
 as an organization, and has created an official, the speaker, 
 second in power, if not superior, to the President, an official 
 hardly considered in the constitution. 
 
 Congress even comes in for criticism at the hands of satirists 
 of the stage. Cliff Gordon is always sure of laughter and ap- 
 plause in vaudeville with the following estimate of the institu- 
 tion: 
 
 "People claim that our congress is to blame for the present 
 condition of things. But look at Russia ! The people over 
 there are fighting to have a congress. Why not let them have 
 ours? The Russian congress is called the Duma. It meets
 
 CO^VmiSSION GOVERNMENT 159 
 
 once a j'ear in the morning and is dissolved at night. Then 
 they meet the next year and get dissolved right away again. 
 Lots of people laugh at Russia — but they know what to do with 
 a congress. And noAV the congressmen speak of moving con- 
 gress from Washington to Philadelphia. They want to get 
 closer to the mint." 
 
 Congress is notorious for many abuses, and its virtues may 
 be as readily exercised by other bodies. Would it not be bet- 
 ter, therefore, to abolish the present system and consolidate 
 the executive, legislative and judicial powers instead of keep- 
 ing them separate? Instead of one president, have a board of 
 five presidents, with all power in their hands, chosen in a non- 
 partisan manner. Such a body would work as well nationally 
 as the local boards do in cities, if constructed on the same prin- 
 ciples. The expedient of the initiative, referendum and recall 
 would supply the direct appeal to the public seen in the votes 
 of confidence in European cabinets. The presidential board 
 would have unlimited authority and would be individually re- 
 sponsible. Incidentally by continuing them in office until re- 
 called, the curse of presidential elections would be done away 
 with. 
 
 This may appear a revolutionary proposal, but it is not. 
 The country is in reality ruled at present by a board of com- 
 missioners. The final power is in the Supreme Court, in effect 
 a set of commissioners. They exercise legislative and judicial 
 functions, but they are appointed by the president and the laws 
 reach them in a circuitous and long delayed fashion. Why not 
 elect them directly by the people, free from partisan influences, 
 and take politics out of business and business out of politics 
 for ever. 
 
 Eventually the country will come to some such plan in form 
 as it is now in effect. The Constitution is defective, antiquated 
 and unsuited to the purposes of libert3^ It is bound to go.
 
 CHAPTER XII 
 INDUSTRIAL HANDICAPS I 
 
 The passing glory of American inventors — Why American engineers are 
 straggling far behind in the world's progress — America from five to 
 twelve years behind the times in important industries — Empty boasts 
 of scientific progress — 100 important inventions originated abroad — • 
 Industrial supremacy of Germany — How achieved in the face of great 
 odds — How science helps industry — The German national testing offices 
 — All the facilities of the government at the command of the German 
 manufacturer — How the American manufacturer works in the dark — 
 The vicious American patent system — Plow it discourages inventions — 
 Better to abolish it entirely — How it pays the patent lawyer to adver- 
 tise — Enormous losses of inventors and the public through patent 
 abuses — The farcical rules of the patent office — How the inventor fails 
 to get a square deal from the government — Millions for imitation, not a 
 cent for original research — Corporations as patent dogs in the manger — 
 Bottling up of valuable patents — The father of aviation in America — 
 Lilienthal's achievements — Stagnation in aviation due to "show-me" 
 spirit of business men — Patriotic support accorded Count Zeppelin in 
 Germany — Absurd position of the United States Government on avia- 
 tion. 
 
 "Everybody is familiar with the claim that American in- 
 ventors, engineers and manufacturers lead the world. A vast 
 amount of boasting has been done about American ingenuity 
 and originality and enterprise. If this claim were well- 
 founded, it would be indeed a matter for national pride; and 
 a quarter of a century or more ago, such a claim had a good 
 deal to justify it. There are a number of fields of inventions 
 and manufacture in which the pioneer work was done by Amer- 
 icans and in which the statistics of experts still testify to our 
 high standing. 
 
 "But when one views the whole field of engineering and in- 
 dustry and particularly the progress of the past twenty-five 
 years, it is rather humiliating to confess that instead of being 
 in the lead, the United States is lagging far in the rear," says 
 the Engineering News of ]\Iay 25, 1911, in asking the question: 
 "Why is Europe in advance of America in Pioneer Inven- 
 tions." It continues: 
 
 160
 
 INDUSTRIAL HANDICAPS I IGl 
 
 "Take for example, the advances made in iron and steel 
 metallurgy during the past twenty-five years. Some original 
 contributions have been made to the art by American inventors 
 in that time, of course ; but the great advances which have been 
 made, have almost all originated abroad. We are to-day some- 
 thing like five years behind Germany in iron and steel metal- 
 lurgy^, and such innovations as are being introduced by our 
 iron and steel manufacturers are most of them merely follow- 
 ing the lead set by foreigners years ago. 
 
 "We do not believe that this is because American engineers 
 are any less ingenious or original than those of Europe, though 
 they may indeed be deficient in training and scientific educa- 
 tion compared with those of Germany. We believe the main 
 cause is the wholesale consolidation which has taken place in 
 American industry. A huge organization is too clumsy to take 
 up the development of an original idea. With the market 
 closely controlled and certain profits by following standard 
 methods, those w'ho control our trusts do not want the bother 
 of developing anything new. 
 
 "We instance metallurgy only by way of illustration. There 
 are plenty of other fields of industry, where exactly the same 
 condition exists. We are building the same machines and 
 using the same methods as a dozen years ago, and the real ad- 
 vances in the art are being made by European inventors and 
 manufacturers, 
 
 "Those 'effete nations of Europe' actually appear to take a 
 certain pride in doing things that are worth while. Original 
 work by engineers and designers is encouraged and rew^arded. 
 In some cases American manufacturers take up these foreign 
 inventions after they have been developed on the other side of 
 the water, and after four or five years the new improvement 
 begins to be introduced here. In other eases, a dozen years or 
 more elapse before any American has enterprise enough to in- 
 troduce here what has been proved to be excellent on the other 
 side of the ocean. 
 
 * ' It would be easy to cite fifty or a hundred important inven- 
 tions of the past quarter century which have originated in 
 Europe and have come into extended industrial use there and 
 which we have either merely copied or in some eases almost 
 ignored here. 
 
 "Take for example, the Diesel engine. Invented nearly a 
 score of years ago, by one of the most eminent of German en-
 
 162 THE PRICE OP INEFFICIENCY 
 
 gineers, it is to-day so little used in the United States as to be 
 practically unknown. In Europe, on the contrary, it is to- 
 day attracting more attention than any other prime mover. 
 Diesel oil engines are now being fitted to ocean vessels of large 
 size. Ship and engine builders in England and on the conti- 
 nent are industriously at work in this field. Dr. Diesel, at the 
 London meeting, declared that Diesel marine engines could pro- 
 duce a horse-power with one-fifth or one-sixth of the weight of 
 fuel required for a steam engine. The enormous importance 
 of such a reduction in the fuel supply, and the resultant in- 
 crease in cargo capacity, is evident to anyone. Prom a naval 
 point of view also, it is pointed out as among the possibilities 
 of the near future that a battleship may yet be built for a Euro- 
 pean power, which will be able to sail around the world and 
 home again without taking on fuel once." 
 
 The views of the Engineering News are a confirmation of the 
 facts as pointed out by Mr. L. B. Stillwell, past president of 
 the American Institute of Electrical Engineers, who in an ad- 
 dress at the dedication of a new hall of science at the Rensselaer 
 Polytechnic Institute, Troy, N. Y., said in part: 
 
 *'The voice of America in this age is one of exultation. If 
 it be assumed that the daily press speaks for our people, it is 
 not infrequently a voice of boasting. The press is not always 
 discriminating in its estimate of the meaning of new steps and 
 easily falls into the habit of exaggerating the value of a new 
 thing and over-estimating its probable results. The man in the 
 street believes that We easily lead the world in science and in 
 its practical applications, but those better informed know that 
 we have strong rivals; that while practice in America in me- 
 chanics and the electric arts compares favorably, as a whole, 
 with that of any other country, the discovery of the facts upon 
 which practice is based has been more often European than 
 American. Even in the practical applications of physical 
 science, it happens not infrequently that we follow and do not 
 lead. 
 
 "The German Empire is a vast hive of industry, organized 
 in a manner of which comparatively few Americans who have 
 not investigated the subject have anything like an adequate 
 conception. In an interesting and very valuable paper upon 
 "Engineering Education," read before the International En- 
 gineering Congress in St. Louis in 1904, Dr. Robert Fletcher, 
 Director of the Thayer School of Civil Engineering, Dartmouth
 
 INDUSTRIAL HANDICAPS I 
 
 163 
 
 College, said: "Realizing that even the most industrious peo- 
 ple must have competent expert direction and that 'efficient 
 direction of any industry to-day demands a large amount of 
 technical knowledge which cannot be learned at the bench or 
 in the shop,' the German government and the people, through 
 trade associations, have established hundreds of schools of ap- 
 plied science for instruction in all the leading industries of the 
 empire, and often many schools for the same industry'. 
 
 "German foresight and system in the organization of edu- 
 cational facilities not less than the industry and the frugality 
 of the Gei-man people have advanced Germany within fifty 
 years from a position of comparative poverty and obscurity to 
 a place in the foremost rank of powerful and progressive na- 
 tions. As Dr. Fletcher well says : ' It is not her army of soldiers 
 which other nations need to fear, but her armies of scientifically 
 trained directors of industrial enterprises and of highly edu- 
 cated commercial agents.' 
 
 "While no other nation to-day provides as effectively as do 
 the Germans for enlargement of the boundaries of science by 
 original research nor for the systematic training of its people 
 in the industrial and commercial use of scientific facts and 
 methods, there is very much that is admirable, effective and 
 worthy of our most careful consideration in the educational, 
 industrial and commercial practice of some other of the great 
 nations. ' ' 
 
 W. H. Dooley in an article ' ' German and American Methods 
 of Production" in the Atlantic Monthly, for May, 1911, says: 
 
 "The average American thinks that the success of Germany 
 is due to low wages and long hours of work. This is not true, 
 for, if labor is cheaper there, coal is dear, machinery dearer, 
 and imported raw material pays a tax. The industrial su- 
 premacy of Germany is the effect of definite and deliberate 
 political action. Thirty years ago the German statesmen real- 
 ized that the nation was inferior to the American and English 
 in natural resources and natural ingenuity; this inferiority 
 forced upon their attention the value of thrift and of education. 
 Thrift was multiplied by capital, and education multiplied by 
 industrial efficiency. 
 
 "Few Americans realize the vast strides which the German 
 industries have taken in the last few years. The great iron 
 and steel manufactures of the Rhine district — of Dusseldorf, 
 Essen, Duisburg and Oberhausen — have attained a remarkable
 
 164 THE PRICE OP INEFFICIENCY 
 
 development, owing partly to the coal mines of the Rhineland 
 and Westphalia, to the great waterway of the Rhine and an excel- 
 lent system of railroads, and partly to economic conditions 
 which it may be interesting to compare with our own, while the 
 rise of some of the great German shops reads like a romance." 
 
 Henry S. Pritchett, President of the Massachusetts Institute 
 of Technology, describes Germany's great development in an 
 article "How science helps industry in Germany," in the Re- 
 view of Reviews, of February, 1906 : 
 
 "In 1870, the manufactures, the inventions and the foreign 
 commerce of the separate German states were far below those 
 of England and of France. To-day United Germany stands 
 in the front rank of the nations of the world in industrial pro- 
 duction, and she clearly leads all other nations in the applica- 
 tions of science to industry and to the arts. Her position is 
 all the more remarkable because this result has been achieved 
 in a country in which the agricultural and mineral resources 
 are not great, and in the face of the burdens due to long and 
 costly wars, to the maintenance of a great army, and to the 
 draining of a large part of its population through emigration. 
 No exploitation of the virgin resources of a new continent nor 
 millions of new citizens drawn from other lands have brought 
 Germany the unearned increment which the United States has 
 enjoyed during the same three and one-half decades. 
 
 "The reasons for this tremendous industrial development 
 are several, but they all spring more or less directly out 
 of the strong national spirit developed by the accomplish- 
 ment of German utility. One of the important factors has 
 been the systematic development of scientific research and the 
 application of research to the practical industrial problems of 
 the nation. 
 
 "About a year ago I heard a famous chemist in Germany ex- 
 plain the present industrial supremacy of his country in words 
 something like these: 
 
 " 'Forty years ago,' said he, 'the scientific men of the various 
 German states devoted their study almost wholly to theoretical 
 subjects. They were humorously described as given up to in- 
 vestigations of the dative case and similar impracticable prob- 
 lems. In a measure this was true. The investigation of that 
 day had a wholesome contempt for anything which promised 
 direct utilitarian results. But the development of the spirit 
 of research throughout the German universities trained a great
 
 INDUSTRIAL HANDICAPS I 165 
 
 army of men to be expert investigators, and when a united 
 Germany arose to ero\\Ti the labors of William I and of Bis- 
 marck, with it came a great national spirit in which the men 
 of science shared. They realized that to them were committed 
 the great industrial problems which must be solved in order to 
 make the nation strong; and scientific research, which up till 
 then had been mainly theoretical, was turned to the immediate 
 solution of the industrial problems of the nation. No longer 
 the dative case alone, but the development of the chemical, 
 electrical and mineral resources of the country formed the 
 avenues of scientific activity, and scientific research, which had 
 till then been looked upon as a theoretical accomplishment, be- 
 came the greatest financial asset of the Fatherland.' There is 
 truth in this statement. The research habit, long cultivated 
 in German universities, had nourished a body of men trained 
 to research, men who had acquired the research habit and the 
 spirit of investigation. When, therefore, the problems of in- 
 dustrial development began to appeal strongly to the national 
 spirit, the country had a trained body of men to call upon who 
 threw themselves heartily and enthusiastically into these prac- 
 tical industrial problems. 
 
 "Perhaps the unique development of industrial research can 
 be appreciated in no better way than to recall the evolution of 
 the Royal Testing Office {Bas Koenigliche Materials-pruefungs- 
 amt), which began thirty-five years ago in a modest shop ad- 
 joining the engineering school at Charlottenburg, and which 
 has within the last two years been transferred to a new and 
 magnificent series of buildings at Gross-Lichterfelde, just out- 
 side of Berlin. 
 
 "The meaning of this establishment, with its experts and 
 laboratories, may be better understood, perhaps, by briefly in- 
 dicating some of the problems which were solved in it. 
 
 "A manufacturer who has a problem on his hands which he 
 finds difficult of solution, can at very modest expense bring this 
 to the research laboratory, where it will be not only attacked 
 by the experts of the establishment, but the experts of the firm 
 may also work side by side with those of the government on 
 the common problem. The advantage which is thus afforded 
 to the manufacturer can hardly be overestimated, for he finds 
 in the government establishment not only a corps of skilled 
 and enthusiastic experts, but he finds also all the literature of 
 the subject, brought together for their use and ready at hand
 
 166 THE PRICE OF INEFFICIENCY 
 
 for convenient reference. The problem may be studied in the 
 light of all that is knowTi on the subject, and starting from the 
 point of the world's knowledge rather than to go through the 
 tedious plan of trying out methods already discarded elsewhere. 
 
 "It is worth our while to consider this idea for a moment; 
 and the great difference between this spirit of dealing with 
 the manufacturer and the inventor and that pursued in 
 our institutions. Hardly a day passes at any scientific es- 
 tablishment in America, or at any great technical laboratory, 
 that some inventor or some manufacturer does not come to its 
 doors seeking expert aid in the solution of his technical prob- 
 lems. 
 
 "He is told, kindly but firmly, that the laboratories of the 
 institution are not meant for his sort of problem and when he 
 asks anxiously whither he may go for such expert aid and ad- 
 vice there is generally no source to which he may be sent except 
 to employ the occasional expert with, at best, meager resources. 
 I must confess to a great feeling of sympathy with such appli- 
 cants, notwithstanding the fact that many of them are cranks, 
 and many othere do not know that the problems they pursue 
 have already been solved or found insoluble. 
 
 "It is true enough that the college laboratories are in no con- 
 dition to undertake many of these investigations, and yet this 
 does not at all answer the fact that there should be some place 
 well equipped whose business it should be to answer such in- 
 quiries, to sift the wheat from the chaff, to tell the ignorant 
 seeker that his problem is already solved, and to point the man 
 with a real problem to the way for a solution." 
 
 While the American government is thus inefficient and negli- 
 gent in not providing facilities for research and testing, it is 
 not in that department that it exhibits the greatest indifference 
 towards real progress. It is in its treatment of inventors, the 
 original sources of the industrial progress of the world, that 
 our government exhibits a degree of hypocrisy, careless injus- 
 tice and indifference to the interests of the public and the in- 
 ventor alike, which is surpassed by no other country. It is by 
 no means an exaggeration to say, as one of America's leading 
 engineers and inventors of applied electricity, H. Ward Leonard, 
 does, that American inventors would be better off if the whole 
 patent system were abolished at a blow. 
 
 Writing in the Electrical World^ May 16, 1908, Mr. Leonard 
 says :
 
 INDUSTRIAL HANDICAPS I 167 
 
 "The United States patent system purports to be a method 
 of rewarding: inventors, and thereby stimulating the production 
 of inventions of value to the public. 
 
 "In reality the principal beneficiaries of the United States 
 patent system are the patent lawyers and the large manufac- 
 turing corporations. 
 
 "There is no class of brainworkers in the world so dependent 
 upon another class as are the United States inventors upon the 
 United States patent lawyers. 
 
 "There is probablj^ not an experienced inventor in the United 
 States who would not prefer some one of the foreign patent 
 systems to our patent system, unless he is reallj^ a representa- 
 tive of one of the large corporate interests. On the contrary 
 practically all patent lawyers will tell you that the United 
 States patent system is the best in the world. And so it is, for 
 the patent lawyers. But it is probably the worst in the world 
 for the inventor. 
 
 "As a class the American inventors are a most helpless class, 
 and are growing more so every day. Thej' do not come in con- 
 tact with each other and have no representative organization. 
 The quality of American patented inventions is depreciating 
 steadily. This is the natural result of the fact that the in- 
 ventor cannot get the reward which, as a patentee, he is entitled 
 to. Most of the money he can earn has to be spent in law^'ers' 
 services and the enormous expenses of patent interferences and 
 litigations, and meantime the large corporations continue to 
 appropriate his new inventions as fast as he patents them. 
 The non-technical and inexperienced judges usually fail to see 
 the invention which the Patent Office saw, and hence decline 
 to grant preliminary injunctions. 
 
 "The chief sufferer from all this is the American public, 
 which in late years is surprised to find that to buy the latest 
 and best inventions, it must indirectly pay tribute to foreign 
 inventors, because the American inventors are being left so far 
 behind. 
 
 "Where did the inventions found in the modern automobile 
 come from? Europe. 
 
 "Where did the designs of pur best battleships come from? 
 Europe. 
 
 "Wliere did the inventions as to recent electric railway de- 
 velopment come from? Europe.
 
 168 THE PRICE OF INEFFICIENCY 
 
 ""Where did the revolutionary inventions in high-efficiency 
 incandescent and arc lamps come from? Europe. 
 
 "It is unnecessary to extend the list. Every observer knows 
 that while twenty years ago we heard almost daily of import- 
 ant inventions of American inventors, nowadays we are obliged 
 to talk of the inventors of the past generation in this coun- 
 try. 
 
 "What will be the outcome of this suppression of the con- 
 stitutional rights of the American inventors? Probably the 
 outcome will be the still further combinations of capital and 
 new boards of patent control and further increase in the price 
 to the public of every manufactured article. 
 
 "What is the relief for the public and for the inventor? 
 The abolition of the so-called patent rights or else an intelli- 
 gent revision of the laws by Congress in the interests of the 
 public and of the inventors. 
 
 "The interests of the public and those of the inventor are 
 in common. The interests of the large corporations and of the 
 patent lawyers are certainly not usually in common with those 
 of the public and the inventors. 
 
 "It is to the interest of the public and of the inventor, that 
 the inventor should have for the life of his patent, the maxi- 
 mum protection at the minimum cost to him, because this en- 
 ables the inventor to make new inventions, to the ultimate 
 benefit of the public and of the inventor. The corporate 
 monopolies rely upon capital and organization more than upon 
 inventions, and it is to their interest that the unaided inventor 
 should have the minimum protection and should have the maxi- 
 mum, expense in trj'ing to establish his rights. As to the patent 
 lawyer, he is the chief beneficiary of the minimum protection 
 and maximum expense system. 
 
 "Every real inventor would gladly pay to the government 
 ten times the present patent fees, if the government would 
 stop granting improper patents upon unpatentable devices, 
 and, on the other hand, would carry out its agreement with him 
 in good faith whenever he is really entitled to a patent, 
 
 "If the government cannot afford to guarantee at its present 
 small fee, the exclusive right it purports to grant, and gets 
 paid for, why does it not charge the inventor enough to do its 
 work properly and guarantee its grants in good faith." 
 
 In another article, "Does the inventor get a square deal at 
 the hands of the United States Government" in the same pub-
 
 INDUSTRIAL HANDICAPS I 169 
 
 ncation, Mr. Leonard points out the system of mulcting the in- 
 ventor which is practiced by the government. 
 
 "The report of the Commissioner of Patents for the year 
 ending Dee. 31, 1907, contains irrefutable evidence that the 
 government is neglecting its obligations to inventors who pay 
 to the Patent Office nearly $2,000,000 per annum in order to 
 secure patent protection for their inventions. 
 
 "The Constitution of the United States says 'Congress 
 shall have power ... to promote the progress of science 
 and the useful arts by securing for limited times to authors and 
 inventors the exclusive rights to their respective writings and 
 discoveries. ' 
 
 "The greatest inventor of all the ages, if he were living to- 
 day, might publish his most valuable discover>^ under the im- 
 plied contract with the United States government that it would 
 'secure' to him by a United States patent the exclusive right 
 for a limited time to his discovery, and, after receiving his 
 United States patent, he would find that although he had per- 
 formed his part of the contract fully and in good faith, he had 
 not secured the exclusive right to his invention for 17 years as 
 expected. 
 
 "He would find that no large corporate interest would re- 
 spect his patent rights unless he was able and prepared to 
 spend many of the 17 years and tens of thousands of dollars 
 to establish the correctness of the judgment of the government 
 in granting the patent to him, which was exactly what he had 
 already paid the government to do. Under no conceivable 
 practical circumstances would he be 'secured' by the govern- 
 ment in having for 17 years the exclusive right to his discovery, 
 which is what he was led to expect he would receive in return 
 for disclosing his discovery, and paying all the necessary- costs 
 of the government investigation of his claim as against the 
 original inventor, and all other costs of every kind incidental 
 to the grant of the patent to him. 
 
 "The recent report of the Commissioner says . . . the 
 surplus in the treasury to the credit of the Patent Office on 
 Jan. 1, 1908, was $6,706,181.64. This surplus of the net re- 
 ceipts over all expenditures has been derived entirely from the 
 fees paid by the inventors of the country, directly or indirectly. 
 
 "In speaking of the 'insufficient force of examiners and 
 clerks,' the commissioner says: 
 
 "Their efforts under these conditions were at best spasmodic
 
 170 THE PRICE OF INEFFICIENCY 
 
 and simply resulted in thousands of actions being made which 
 "were nothing more than frivolous ... A great many ap- 
 plications were passed to issue that were not ready for patent, 
 with the result that the inventors and o^\Tiers of meritorious in- 
 ventions forfeited valuable rights by these careless, ill-consid- 
 ered and hasty actions on the part of the patent office 
 Complaints against the conduct of affairs in this office have 
 been numerous, and many have been based on good and suffi- 
 cient grounds." 
 
 ' ' It seems evident from these quotations and from facts famil- 
 iar to all who have to do with patents, that inventors are not 
 justly treated by the government as to the granting of patents. 
 Eveiy year, our patent system becomes more complicated, more 
 expensive to the inventor of a valuable discovery, more un- 
 trustworthy, more unjust and more absurd. The rights and 
 opinions of inventors themselves seem to be considered of no 
 importance as compared with those of patent lawyers and large 
 corporate interests, many of which exist solely upon the dis- 
 coveries of unrewarded inventors. 
 
 "Our patent system seems to be based upon many absurd 
 assumptions, among which may be enumerated the following: 
 
 "It is assumed that the half-paid men who act as examiners 
 are invariably and absolutely trustworthy and are incapable 
 of intentionally or unintentionally betraying the trust imposed 
 in them when the inventor confidentially discloses his discover- 
 ies to the Patent Office, or of acting unfairly as between rival 
 applicants. The Commissioner says in his report: 'The office 
 has become merely a post-graduate school for the technical and 
 legal education of young college men who enter the service. 
 The General Electric Company has in its patent department, 
 twelve or more men who were formerly examiners in this office, 
 and other corporations have taken hundreds of them from the 
 office. ' 
 
 "No doubt, the examiners are as good as and no better than 
 the average college graduate. As to whether such men are in- 
 variably and absolutely trustworthy, the records of the public 
 press clearly show. One fact is evident — the 'corporations' 
 find that it paj's them to hire these Patent Office examiners by 
 the 'hundreds' or they would not do so." 
 
 Mr. Leonard continues his protest against the injustice of the 
 patent system by showing how it places a premium upon forgery 
 and perjury, when two inventors have applications pending
 
 INDUSTRIAL HANDICAPS I 171 
 
 for a patent on the same invention, usually the case when a true 
 inventor is waiting for a patent and a rascal finds out the facts 
 and files his application for the same invention and then proves 
 by perjured testimony that he Avas the first to "invent" the 
 thing. He also points out that many patents are issued to 
 "inventors" of inventions which are already covered by the ap- 
 plications of previous true inventions not yet acted upon, and 
 that many patents are issued covering devices that are public 
 property, both abuses of the gravest sort. Speaking of the 
 advertisements of patent lawyers, which are so noticeable a 
 source of revenue to practically all publications, which keeps 
 them silent on the injustice to inventors, he says: 
 
 "When one remembers that it evidently pays some patent 
 laAA-yere to advertise in every publication in the land to 'patent 
 your inventions' it is apparent that all but a small percentage 
 of the patents which issue are merely a means of securing gov- 
 ernmental aid in mulcting inexperienced men into applying for 
 a detail patent upon a worthless modification of a well kno^vn 
 device. ' ' 
 
 Referring to one of the worst features of the patent system, 
 the absurd and involved multiplicity of claims attached to pat- 
 ents which are even to patent lawyers almost if not quite unin- 
 telligible, he says: 
 
 "The United States patent depends, not on the real invention 
 which the inventor has made and published in good faith, but 
 on the contrary, depends principally upon the refined use of 
 peculiar phrases and punctuation points in a series of ridicu- 
 lously spun-out claims necessitated by the United States patent 
 system in order to prevent an infringer from hiding behind 
 some semicolon or other equally absurd shield." 
 
 The system of claims, often upwards of a hundred in number 
 attached to patents, is a noxious growth of verbiage which is 
 chargeable to the hair splitting of judges. ]\Iany years ago, 
 they decided that irrespective of the invention shown in the 
 main body of the specification of the patent, where the real 
 invention is described, if the claims appended did not exactly 
 cover it in the most minute fashion, the whole invention was 
 lost. The incalculable amount of damage that has been done 
 to inventors and the people of the United States by this hair 
 splitting decision it is impossible to estimate. To-day inven- 
 tions are not decided on their merits, but exclusively on the 
 adroitness and subtlety with which the patent lawyer has
 
 172 THE PRICE OF INEFFICIENCY 
 
 drawn the claims. This is one of the accursed farces which 
 lawyers inflict upon the public which supports them. 
 
 The United States government, as we have seen, gets $2,- 
 000,000 in profit per annum out of the inventors. The patent 
 lawyers get at least $10,000,000 from the inventors for taking 
 out these patents. The public gets the benefit of the discover- 
 ies. What do the individual inventors get for their discover- 
 ies? 
 
 It is probably true that the average United States inventor 
 would be better off if there were no United States patents of 
 the present kind. In that case, the inventor could use his 
 money in marketing his discovery, and his manufacture would 
 not be embarrassed by the many improperly granted patents 
 to wealthy competitors, which patents he must to-day respect 
 because of his inability to spend the necessary money in litiga- 
 tions. Of course, so long as the present patent system exists, 
 an inventor cannot afford to not take out patents while his 
 competitors are patenting every conceivable detail. 
 
 The patent system of the United States has thus become cov- 
 ered with barnacles of corporate self interest and growths of 
 lawyers' technicalities. There comes a time in the history of 
 every institution, as in the voyages of a ship, when progress 
 seems to cease and former effectiveness is lost. At such a time, 
 the vessel must go to the dry dock and be cleared of the foul 
 accumulations of parasites. The United States patent system 
 has reached such a stage. The sooner it is dry-docked for re- 
 pairs the better off the whole country will be, for the American 
 inventor needs only a fair chance to redeem himself. To-day he 
 is engaged in other occupations, for invention has become too 
 costly for inventors to engage in it. 
 
 The attitude of indifference to the great value of experi- 
 mental work and of neglect in the development of inventions is 
 illustrated by an occurrence which was reported in the news- 
 papers at the time of the mobilization of the American troops 
 on the Mexican frontier. 
 
 It was urged on President Taft, that the use of aeroplanes 
 in the army be given greater attention, but the president was 
 not in favor of the plan, being reported as opposed to having 
 the United States spend much money for the purpose. He 
 considered it wiser to let other countries do most of the pre- 
 liminary work in discovering the uses of aeroplanes in war, 
 there being plenty of time later to gamer the harvest of good
 
 INDUSTRIAL HANDICAPS I 173 
 
 results, if any such should appear, which other countries dis- 
 covered. 
 
 In other words, the president, with apologies to a famous 
 slogan, meant: ''i\Iillions for imitation, not a cent for original 
 research," or, let the foreigners experiment and perfect and 
 we will buy a book. Thus the American aeroplane inventor is 
 encouraged. And the attitude of the president is that of most 
 manufacturing plants; to let others discover and then appro- 
 priate the results of their research. 
 
 The American inventor, in addition, has in the experimental 
 workshop another system to contend with ; that of being charged 
 by the hour for experimental work; usually seventy cents an 
 hour; and of seeing the work proceed at the most leisurely 
 pace which the shop proprietors can devise. Thus in the de- 
 velopment of inventions, the first cost is so excessive as to 
 discourage a great number of improvements. 
 
 The United States patent system, while originally designed 
 to aiford the inventor the most complete protection possible, 
 in doing so defeats its own objects in many eases. A patent 
 if it is finally confirmied by the courts is absolute property. 
 The inventor need not work it in order to hold it. As a con- 
 sequence, many important patents are acquired from inventors 
 by manufacturers and then not utilized at all. The inven- 
 tion may be one that would interfere with some machinery 
 of the manufacturer already on the market, so that improve- 
 ment is quietly laid away, the inventor loses possible royalties 
 and the corporation acts the part of a dog in the manger, 
 neither using the invention itself or allowing anyone else to 
 do so. 
 
 Notable among the inventions of this character now bottled 
 up, is the three phase system for electric railways, which stores 
 up power while the car runs down hill to be utilized later. 
 As this would have made it possible to make power plants 
 much smaller for the same service, and w'ould have intro- 
 duced a new line covering equipment already on the market 
 for the purpose, a big electrical concern purchased the rights 
 and laid the thing away. Meanwhile it continues to sell to 
 those needing power, larger and more costly equipment than 
 would be necessary if the invention were in use. Such cynical 
 employment of the features of the patent law intended for 
 the benefit of inventors and the public may well cause its pro- 
 visions to be questioned.
 
 174 THE PRICE OF INEFFICIENCY 
 
 It is a well recognized fact in the electrical engineering 
 circles that practically no progress has been made in electrical 
 illumination for years. The recent improvements, the flaming 
 arc and the metallic filament lamps which consume two-thirds 
 less current for the same illumination, are German inventions. 
 For the five patents on the latter, one prominent American 
 concern paid $1,010,000 in addition to royalty. This is the 
 white looking incandescent lamp, known as the tungsten lamp 
 and also by the trade name of mazda. 
 
 Behind the trade name of "Mazda" is cloaked one of the 
 most peculiar propagandas of invention and commerce. It is 
 part of what may be termed the "Edison tradition." 
 
 The writer has discussed this subject in the technical press 
 and the following is a quotation from an article of his in the 
 Electrical World of November 16, 1912: 
 
 "A conspicuous example of the pervasive qualities of the 
 'Edison tradition' is seen in the name being given to the tung- 
 sten lamp, a German invention, as is well known to the engi- 
 neering profession, but not as well known to the general pub- 
 lic. For reasons that are not well known, the name tungsten, 
 which is that of the principal element of the filament, has been 
 more or less side-tracked, as far as it has been within the 
 abilities of those interested to change a great public recognition 
 of an important invention by attempting to dislodge a word 
 that the public has universally adopted and which has be- 
 come embedded in the language, and the arbitrary word 
 'Mazda' has been substituted as the first step away from 
 tungsten, while the 'Edison-Mazda' is beginning to appear. 
 No doubt finally both 'Mazda' and tungsten will be dropped 
 and the 'Edison tradition' will be restored to its time-honored 
 position in regard to lamps. The later tungsten lamp will 
 probably become the new Edison lamp, while the present will 
 be knoAvn as the old Edison lamp, and chiefly remembered as 
 the one which became Edison at all, as the result of a court 
 decision against a poor German inventor. 
 
 "In the immediate past the curtain has suddenly risen on 
 a well-set rural scene, the 'Edison' farm. It has been dis- 
 cussed before engineering societies and in the public prints, 
 and the latter report that Edison is equipping his country 
 house with all kinds of electrical devices. Evidently electric 
 farming in the United States is marked out for the 'Edison* 
 label. Yet on page 489 of your issue of Sept. 16, 1905, some
 
 INDUSTRIAL HANDICAPS I 175 
 
 seven years ago, under the heading of 'Electricity in Agricul- 
 ture,' M. E. W. Baker, of Barry, 111., directed attention to 
 the slow progress in the United States in the adaptation of 
 electricity to agriculture, while in other countries, notably Ger- 
 many, rapid advances have been made. Mr. Baker stated that 
 from 1893 to 1901 he had searched the index of the Electncal 
 World and Engineer for notices of electric plo\\dng and found 
 many references, but all to 'trials made in Germany,' and 
 concluded: 'I think it high time that this odious German 
 label should be removed in a branch of applied science where 
 otherwise we Americans stand first.' 
 
 "Since that time (1905) I have endeavored in a modest way 
 to arouse interest in electric farming in this country by means 
 of articles in the technical and general press and in other 
 ways, by reporting progress and results under practical work- 
 ing conditions abroad where electric farming is carried on to 
 a large extent as it has been carried on for nearly twenty years. 
 Nevertheless, the first electric plow has yet to turn a furrow 
 in the United States, though hundreds of thousands of acres 
 have been plowed by electricity abroad. 
 
 "If, however, any small efforts of mine have been the cause 
 of attracting the attention of the 'Edison tradition' to electric 
 farming — for a long while I was practically alone in calling 
 attention to the subject — I shall feel honored in having made 
 that contribution to an ever increasing convention. I shall 
 gladly join the ranks of those whose ideas have gone to build 
 up the marvelous figure of the inventive superman." 
 
 The progress Germany has made in street illumination 
 largely due to their originality, may best be judged from a 
 quotation from an article "German vs. American street light- 
 ing," by Mr. B. F. Pierce in "Public Service" for February, 
 1911 : 
 
 "The preeminence of Germany in all that pertains to il- 
 lumination is so generally acknowledged that ideas from Ger- 
 man practice are, or at least should be, welcome to every pro- 
 gressive illuminating engineer. In street lighting, especially, 
 Germany has far outstripped America; in fact, there is scarcely 
 a single street in the United States to-day that could be called 
 even fairly well lighted, according to German standards. 
 
 "Various explanations are offered as to tlie obvious inferi- 
 ority of America in this respect, but few of them are at all 
 satisfying. It is contended by some that the greater density
 
 176 THE PRICE OF INEFFICIENCY 
 
 of population in Germany permits a greater expenditure per 
 mile for street-lighting purposes. This will hardly hold water, 
 however, as many well-lighted German cities spend less per 
 mile of street than American cities, which are undeniably 
 poorly lighted. Another equally misleading explanation is in 
 the low cost of carbons and labor in Germany, which permits 
 high efficiency arc lamps to be run at a reasonable cost. This 
 is not borne out, however, by a comparison of the cost per unit 
 for operating such lamps abroad and at home." 
 
 German superiority in this respect is due principally to her 
 inventors, and to the efficient manner in which their inventions 
 are utilized. In Germany an inventor is an inventor, not a 
 joke, and a patent is a patent and not merely a license to bring 
 a law suit. 
 
 The lax administration of the United States Patent Office 
 in improperly granted patents, few of which get through 
 the German patent office, causes a vast expense in litiga- 
 tion and wide spread discouragement of industry. In Lon- 
 don an American patent is regarded as hardly better than 
 a French patent, which the French government does not 
 guarantee in the slightest respect. In France the inventor 
 merely files his application and a patent is granted forthwith. 
 Thus fifty inventors can get a patent on the same thing if they 
 desire. But they work under no misapprehension about it. 
 The system is similar to the method of the United States in 
 granting copyrights, and works out much better in practice than 
 our patent system, because with the American copyright and the 
 French patent, the matter is up to the courts from the start, 
 and whoever proves to be the first inventor is really protected, 
 while in the American patent system, the first inventor is too 
 often deprived by the legal machinery of all his rights through 
 no fault of his own. In the French patent system and the 
 American copyright system, the invention or the work is pro- 
 tected and somebody is decided to be the first inventor, some- 
 body gets the protection, but in the American patent system, 
 somebody generally gets cheated, the invention is fortunate if 
 it is not lost entirely in the shuffle, and the one cheated is most 
 apt to be the real inventor. This comes from the government 
 pretending to do a thing which it does not do. 
 
 An illustration of the complicated processes of the patent sys- 
 tem, as compared with Germany, is shown by the fact that in 
 London the possessor of a German patent on any invention of
 
 INDUSTRIAL HANDICAPS I 177 
 
 value can readily form a company and secure capital to promote 
 it, or he can sell au option to some promoter in twenty-four 
 hours, while the holder of an American patent in London finds 
 all doors closed against him unless it has been "adjudicated." 
 That is, until the courts uphold it after years of litigation, it 
 has no value. 
 
 Aviation furnishes a new commentary, if any were needed, on 
 the imperfection of the American patent system. The Wright 
 brothers have been granted certain patents, in fact they received 
 them before aviation was an established thing, and shortly after 
 the patent office outgrew the rule that aviation patents were 
 based on impossibilities and could not be granted at all unless 
 practical demonstrations were shown. It is claimed that the 
 patents to the Wrights were on features well kno^vn to earlier in- 
 vestigators. If this proves to be the case, and the Wrights' 
 patents are shown to have been improperly granted, a great in- 
 justice has been done those w^ho are being sued for infringement. 
 The cost of litigation of this character which is always drawn 
 out to great and unnecessary lengths, with large expenses for 
 stenographic, witness and other court costs, is so much money 
 wasted out of the pockets of the public as a whole eventually, 
 and immediately, a heavy tax on the persons directly involved. 
 
 Of greater damage is the discouragement of aviation, owing 
 to the possibility of the Wrights' patents being upheld, which 
 checks and will continue to check for years, the proper develop- 
 ment of the art. Not only will the infringers, if such they are 
 proven to be, be compelled to pay large sums to the Wrights, 
 but the latter are charging and receiving a license of $100 a 
 day for the use of their patents, none of wiiich is ever likely to 
 be returned in any event. They are either in the right or in 
 the wrong, the victims of grave injustice or the perpetrators 
 of an outrageous imposition on the new industry; but the true 
 culprit is the patent system of the United States which permits 
 such doubt and uncertainty to exist and be continued, for no 
 useful purpose whatever, and accomplishing nothing but lining 
 the lawyers' pockets, while the industry is choked at its very 
 beginning. 
 
 The Scientific American of May 13, 1911, in giving a bi- 
 ographical sketch of Octave Chanute who is sometimes called the 
 "Father of Aviation" in America, states: 
 
 "On June 22nd, 1896, accompanied by Mr. W. A. Herring, 
 and two assistants, he went into camp among the sand dunes
 
 178 THE PEICE OF INEFFICIENCY 
 
 on the southern shore of Lake Michigan, to study the art of 
 navigating an aeroplane without artificial power. He and his 
 assistants made some flights with a Lilienthal monoplane, but 
 finding this unsafe and treacherous, they discarded it in favor 
 of the multiplane wing glider designed by Chanute, which after 
 many empirical modifications in the placement of the sustain- 
 ing surfaces, assumed the form of the ordinary multiplane 
 glider of the present day. This glider resembled the Lilienthal 
 biplane in having the surfaces vertically superposed, the rider 
 below them, and the rudder in the rear, but it was a five decker 
 whose wings on either side, could swerve fore and aft, so as to 
 bring the center of lift always over the center of gravity, in 
 order to prevent excessive rearing. 
 
 "A full account of these experiments was published by Mr. 
 Chanute in the Aeronautical Annual of 1897, and in a paper 
 read by him before the Western Society of Engineers in the 
 same year. This paper stated that the experiments were promis- 
 ing, and invited other investigators to improve upon them. 
 Presently other persons in other countries did improve upon 
 them, notably the Wright brothers and Montgomery in America, 
 the Voisin brothers, Ferber and others in Europe. 
 
 "In March, 1900, one of Mr. Chanute 's earliest disciples, Wil- 
 bur Wright, wrote inquiring of him as to the best materials to 
 be used, construction of his machine, the most suitable place 
 to experiment, etc., saying that he had notions of his own that 
 he wanted to try and that he knew of no better way of spending 
 his vacation. All that information was gladly furnished and 
 the two men became fast friends. 
 
 "]Mr. Chanute forwarded a quantity of aeronautic literature, 
 visited the camp at Kitty Hawk, North Carolina, where Wilbur 
 Wright and his brother, Orville, made their first glider experi- 
 ments, and continued their steadfast mentor till they trans- 
 formed the glider into a true dynamic aeroplane." 
 
 According to Lougheed's ''Vehicles of the Air," Lilienthal 
 is given a high place among the pioneers of aviation : 
 
 "Probably no other worker in the history of aeronautical 
 science is entitled to a higher place than Otto Lilienthal whose 
 early and thorough investigations have formed the groundwork 
 for a large proportion of subsequent successful experiments. 
 Lilienthal's investigations commenced in 1871; all told he per- 
 formed over 2,000 glides, of a maximum length of 1,000 feet, and 
 a maximum speed of 22 miles per hour. In 1896 he built a
 
 INDUSTRIAL HANDICAPS I 179 
 
 2^ horse power motor, and it was in testing this power propelled 
 biplane that he met his death by a fall from a height of 50 feet, 
 on August 10, 1896." 
 
 The Wright brothers made their first flight with a power pro- 
 pelled biplane at Kitty Hawk, Dee. 17, 1903. 
 
 It might here be of interest to quote further from Lougheed 
 as to the originality of wing warping: 
 
 "This method of balancing, which is perhaps the most effect- 
 ive known, was patented in France by D'Esterno, was used 
 by Le Bris, and was first patented in the United States by Mouil- 
 lard (No. 582,757, filed Sept. 24, 1892, issued May 18, 1897, 
 expiring May 18, 1914). Another early recognition of its merits 
 appears in the Scientific American Supplement of June 4, 1881." 
 
 Wing warping is used in modern machines, such as the 
 Wrights, Bleriot, Montgomery and other machines. 
 
 The question would appear to be pertinent at this juncture 
 as to what jNIouillard is doing. Why wdth the Wrights suing 
 on a combination of wing warping and steering, he does not 
 open up on them on the wing warping device upon which their 
 alleged improvement is based? 
 
 Although American aviators have achieved signal triumphs 
 in aviation, the art has been almost wholly developed abroad. 
 According to Augustus Post in The World's Work, July, 1911, 
 the number of licensed aviators in the leading countries was : 
 
 France, 339; Germany, 43; England, 39; Italy, 27; Belgium, 
 24; United States, 18; and Austria, 18. 
 
 The interest in aviation abroad has no counterpart in Amer- 
 ica. The reason is not difficult to state. The grab-all tactics 
 of the Wrights is one of the reasons. The other is the "show- 
 me" spirit of American business men. Though it rarely occurs 
 to the layman, aviation is a highly expensive matter, an aero- 
 plane being worth from $3,000 to $10,000. It takes money to 
 make the aviation mare go, and the American business man has 
 not taken the enthusiastic interest in aviation and has not 
 offered the numerous prizes that French men of business have 
 devoted to aviation. The "show-me" spirit, the American busi- 
 ness man's cynical tight-wadism has killed aviation in the bud. 
 
 The patriotic support and interest accorded Count Zeppelin 
 has struck no answering chord in America. No American 
 Zeppelin has been evolved. If he ever existed in embryo he has 
 probably starved to death trying to get business men interested. 
 After the destruction of a Zeppelin's airship, near the conclu-
 
 180 THE PKICE OF INEFFICIENCY 
 
 sion of its first long journey, a public subscription of 6,000,000 
 marks ($1,500,000) was made within two weeks. And with this 
 money, he established the manufacture of airships on a com- 
 mercial basis. Another public subscription, of $1,750,000, was 
 made in 1912 for the national aviation fund. Public support of 
 the airship in Germany also takes the form of traveling, and the 
 Zeppelin ships, while they have had numerous accidents, have 
 killed no one since the start of passenger service in 1908. The 
 receipts from passenger traffic have amounted to $122,000 with 
 one ship traveling over 15,000 miles between August 1, 1910, and 
 January 31, 1911, carrying 5,000 passengers. 
 
 Governmental support of aviation, too, especially in Germany 
 and France, is a great stimulus to the art, an aid almost wholly 
 lacking in the United States. It is reported that the German 
 government will shortly create the office of Minister of Aerial 
 Navigation in connection with the Aviation Department, and that 
 the first minister will be Count Zeppelin. 
 
 According to a recent report, as pointed out by Brigadier 
 General James Allen, Chief Signal Officer, in his annual report 
 (1911), the United States, although the first nation to recognize 
 officially the aeroplane for military purposes, has been surpassed 
 by German}^, France, Italy, Austro-Hungary, Russia, Great 
 Britain, Belgium and Japan in aeronautical equipment. 
 
 The only aeronautical equipment which the United States 
 government possesses besides three small captive balloons, is one 
 Wright aeroplane and one small dirigible balloon. 
 
 "Germany and France continue to lead in the development of 
 aeronautics, far eclipsing their competitors. According to fig- 
 ures recently published, the military powers have the following 
 lighter than air machines or dirigibles. 
 
 "Germany, 14; France, 7; Italy, 3; Austro-Hungary, 3; 
 Russia, 3; Great Britain, 2; Belgium, 2; Japan, 1, and the 
 United States, 1. 
 
 "The figures given for heavier than air machines are: 
 
 "France, 36; Germany, 5; Great Britain, 4; Russia, 3; Italy, 
 2 ; Austro-Hungary, 2 ; Japan, 2 ; Belgium, 2 ; and the United 
 States, 1." 
 
 It can be seen that the United States foots the list, being be- 
 hind Belgium and Japan. 
 
 Considerable detail has been given to the subject of aviation, 
 being a recent one much in popular interest, and showing in its 
 various phases the patent mix-up, the lack of governmental
 
 INDUSTRIAL HANDICAPS I 181 
 
 initiative and the close fisted methods of American business men, 
 a striking example of the attitude and methods of America in 
 dealing with new propositions. The history of aviation is the 
 history of every improvement in America ; callous indifference 
 by government and business men, hopeless struggles by inven- 
 tors, and costly litigation of a most interminable character to 
 fix the status of patents which should never have left the patent 
 office. The thing is characteristic of America to-day, and one 
 of the principal causes for the condition in Avhich the country 
 finds itself is outlined in aviation. Many other subjects could 
 be taken up, in which our engineers realize that America is be- 
 hind, as far behind the leaders of progress as she is in aviation. 
 It is time for America to w-ake up. She has rested on her laurels 
 long enough.
 
 CHAPTER XIII 
 INDUSTRIAL HANDICAPS II 
 
 The grim destiny of the modern workman — The blight of standardization 
 — The uniformity of the American — How standardization blocks prog- 
 ress — Unhealthy condition of American manufacturing industries — 
 How the worn out human machine is scrapped — The passing of the old 
 order — Fatuous efforts of labor unions to block progress — The new 
 plan of common sense working, or so-called "scientific management" — 
 How it may be utilized to cut the cost of living in two — False views 
 of working men — Incalculable damage done by misguided restriction of 
 output — What wage earners earn — An average of $9 a week — How the 
 flood gates of prosperity might be opened — The deadly virus of "what's 
 the use." — Regulation of employment in Germany — Daily schedule — 
 The national efficiency movement. 
 
 The relations between capital and labor in America, and their 
 relations to the public, amount to a system of exploitation and 
 spoliation at every turn which is undermining the foundations 
 of prosperity and industry. 
 
 Employer and employee are at daggers' points and their in- 
 terests become diametrically opposed. The organized laborer 
 becomes a distinct species, so to speak, which like an insect out 
 of the grub stage, is a full-sized fly never to grow larger, and 
 never having been smaller. The union laborer has always been 
 a laborer and he never expects to be anything else. 
 
 The old order in which a man had the possibility and incen- 
 tive to become his own boss and an emploj^er, has passed. With 
 the growth of corporations, the consolidation of rival manufac- 
 tories, the development of standardization and the cost of ma- 
 chinery, the number of individuals who may rise to positions 
 of responsibility is restricted more and more. Only the most 
 brilliant and resourceful can hope to gain a foothold sufficient 
 to command the capital necessary to enter into competition with 
 other masses of capital. 
 
 The workman is destined more and more to remain a work- 
 man, and as such, his former ambition to be a good workman 
 in the hope of advancement has been abandoned. He is now 
 
 182
 
 INDUSTRIAL HANDICAPS II 183 
 
 out to get all he can right away and do as little work for it as 
 possible. The capitalistic employer is out to get as much out 
 of his men as he can as cheaply as he can. They are simply 
 units of work. So many hours of labor, so many pounds of ma- 
 terial, so many tons of coal and you have a given volume of 
 manufactures. The question of personality, of individuality, is 
 lost sight of. All idea of real co-operation is gone. The em- 
 ployer who has a large factory cannot know his men by name, or 
 even their faces. They are numbers in the industrial game, and 
 though sporadic efforts are made at improving the condition 
 of the employees, it is always with the idea of getting more work 
 out of them and is always met with ingratitude on the part of 
 the emploj'ee. 
 
 This condition of affairs is typical of modern conditions, but 
 in America it reaches its worst development. This is largely 
 due to standardization, a thing that for the sake of cheapness, 
 cheapens the workman and in addition reduces the customer to 
 as dead a level of sameness as is possible. 
 
 Americans as individuals are largely standardized. They 
 wear a standard hat, a standard coat and standard shoes. The 
 same necktie rules from j\Iaine to California and the umbrella 
 in Chicago is a twin of the umbrella in New Orleans and likely 
 out of the same factory. The standardization extends into the 
 fiber of the individual and what he does and is and thinks, even. 
 The hat, for example, has a standard season, the straw hat ap- 
 pearing promptly on June 15th by common consent, while on 
 September 15th the faithful "Kelly" must be put aside in favor 
 of the winter hat. 
 
 The European, who regards the American as a very practical 
 person, is vastly mystified by the sudden abdication of the straw 
 hat on this particular date. Although worn religiously through 
 rain and wind which may come in the early part of the month, 
 it must not be seen after the IStli no matter how warm the 
 weather may turn. The foreigner is never able to fully ex- 
 plain it. 
 
 Styles, too, are standardized, and the fashion of women's 
 clothing, though changing from year to year, is standard while 
 it rules. 
 
 Standardization as it affects the public results in pronounced 
 economies in the regular lines of merchandise. The vast num- 
 ber of articles of a single pattern turned out, whether hats, 
 chairs or hardware, enables the cost of manufacture to be reduced
 
 184 THE PRICE OF INEFFICIENCY 
 
 to the lowest possible figure. The cheapness of the standard 
 products causes their use by everyone, so that in any Ameri- 
 can home, much the same furniture will be found as in any 
 other. The carpets, rugs and pictures will be the same or very 
 nearly so. Thus a machine-made atmosphere, a lack of origi- 
 nality and personality and a lack of the opportunity for de- 
 veloping taste, envelops the American and still further makes of 
 him a standardized unit, to live a standardized life and be 
 buried in a standardized coffin by a standardized undertaker 
 who furnishes a standardized funeral for $75. Many Ameri- 
 cans are hurried to their graves by the great cost of articles 
 which they may require outside the regular "lines." In a 
 hardware store, for example, if an article is not "stocked" the 
 customer is regarded in a very frigid manner. Does he think 
 himself better than other people, or is he only cranky that the 
 regular lines are not sufficient. Perhaps he can find it else- 
 where but it is not likely. In any event he is informed that 
 the store does not "carry" it, and that it must be made up 
 "special" at sixty or seventy cents an hour for labor for an 
 article that, if it were standard, would be turned out by the 
 thousands per hour on an automatic machine. 
 
 The principal handicap of standardization, however, is the 
 great difficulty of breaking away from the regular line. Im- 
 provements, thus, are not readily introduced and the antique 
 lines continue to be forced on the public. One example is in the 
 number of threads on a bolt. The standard threads are too 
 coarse for most purposes, and not theoretically correct for mod- 
 ern materials. Yet no new standard has been able to force its 
 way on the market to any extent, though a certain line of bolts 
 for automobiles has appeared. 
 
 Another example in the line of machinery illustrates the 
 strangle hold of standardization on industry. The Electrical 
 World of April 6, 1911, in an editorial, "A Lesson in Econ- 
 omy," referring to German practice, especially to certain en- 
 gines consuming an average of 8.5 to 9.5 pounds of steam per 
 horse power per hour, which is near the record of steam con- 
 sumption of seven pounds per horse power per hour, states: 
 
 "This ought to bring a blush to the cheeks of our countrymen 
 who pride themselves on their progressiveness in engineering 
 matters and in manufacture. We have been preaching super- 
 heated steam in season and out of season for some years past, 
 and even now its use is only sporadic. When one looks at the
 
 INDUSTRIAL HANDICAPS II 185 
 
 record of the German units, his patriotic fervor for American 
 enterprise receives something like a cold douche. When one 
 considers that there are many thousands of these units in use, 
 varying from less than 100 horse power up to 600 horse power, 
 and on the average producing power on less than ten pounds 
 of steam per horse power per hour, he can only wonder in a 
 dazed sort of way how our engineers and manufacturers have 
 allowed themselves to be outdone without a single recorded 
 effort in self-defense. 
 
 "The usual excuse is made that these engines are difficult to 
 operate, but if ignorant Chinamen, Malays, the bushmen of 
 Africa and South American half-breeds can serve as combined 
 engineer and fireman, as they do on units as large as 350 horse 
 power, our own 'licensed' engineers should find no trouble in 
 learning to do so. It is putting it mildly to say that machines 
 of this class are capable of cutting the coal consumption and 
 labor in two, as indeed the properly planned, superheated plant 
 should do. They are doing the work which in this country is 
 mostly done by high-speed, single-cylinder engines using at least 
 30 pounds of steam per indicated horse power, and requiring 
 the services of two men instead of one. We hear rumbling^ in 
 the distance, a deprecatory chorus about upkeep and repairs, 
 but the fact is that the continental engineers have already had 
 a good deal of experience with superheated steam and are not 
 in the least afraid of it, while high superheating is here looked 
 upon with the distrust that is born of ignorance. If anyone 
 thinks that we are putting the case too strongly, let him the 
 next time he wants a small generating unit try the experiment 
 of asking bids on a superheated steam equipment with a guar- 
 antee of ten pounds of steam per brake horse power hour. It 
 would be interesting to see the correspondence which would fol- 
 low the proposition. 
 
 ''The simple fact is that the American mania for so-called 
 standardization has blinded us on this side of the water to^ what 
 is really going on in the world. Yet the continental engineers 
 who are working along that line lack neither skill nor experi- 
 ence and would not be willing to send equipment of this kind 
 to the ends of the earth to be run by untrained men unless they 
 were prepared to stand back of it. American manufacturers, 
 we may be proud to say, can do as good work as any in the 
 world, and American engineers are fully capable of holding up 
 their end, but the latter cannot move until the former tell them
 
 186 THE PRICE OF INEFFICIENCY 
 
 to go ahead, and the former consistently dodge the introduction 
 of unfamiliar apparatus until they are clubbed by commercial 
 pressure into the path of progress. They move along the path 
 of least resistance and unfortunately this is not upon an up 
 grade. We understand fully the commercial forces that tend 
 toward standardization of output, and we do not undervalue 
 the convenience of this standardization, yet the time comes 
 when a break has to be made, and when this time comes it is 
 necessary to work quickly. In our judgment, the psychological 
 moment in superheated steam work is near at hand. Suppose, 
 for example, the not impossible case of the abolition of the 
 tariff on such machinery as is here under consideration and the 
 subsequent irruption of active German agencies. How, indeed, 
 could competition be met if the tariff were even materially 
 lowered? If our American manufacturers do not brace up and 
 meet the situation they vnll wake up some fine morning to find 
 their business imperiled." 
 
 It is undoubtedly true, as the Electrical Woiid states, that 
 American manufacturers do not want to appreciate the advan- 
 tages outside of standardization. The American manufacturer 
 does not adapt himself to the needs of his customers, but bends 
 them to his wares. This is accomplished by force of advertising 
 and control of trade channels, but it is a policy that will not 
 work abroad and the American manufacturer loses a vast 
 amount of export trade in consequence. The Chinese, for ex- 
 ample, it is said, prefer their tacks in blue boxes of a certain 
 shape. This sounds like nonsense to an American manufac- 
 turer, and he sends out standard shaped boxes with red labels 
 and Avonders why they do not sell. And he is at a loss to under- 
 stand why his exports of cutlery are small. It is because his 
 few standard lines of knives cannot fill the requirements of the 
 knives for the various trades and uses, and the Gennan factory 
 which turns out over seven thousand different kinds of knives 
 gets the business. 
 
 The effects of standardization on workmen is one of the black- 
 est tragedies of industrial life ; the tragedy of turning men, first 
 into machines, and then, their usefulness interrupted or ended, 
 of setting them adrift, unfit and unfitted for any other kind of 
 work. 
 
 In order to produce cheaply, large quantities must be manu- 
 factured, which involves frequent repetition orf the same opera- 
 tions. As far as possible, these are performed by machines, but
 
 INDUSTRIAL HANDICAPS II 187 
 
 every machine, however automatic, needs some human attention, 
 if it be no more than the throwing of a lever at certain intei-vals. 
 
 The man who throws the lever may do it for years. All he 
 knows is to throw that lever, but he can do the task better than 
 anyone else in the factory. Yet he can do nothing else, and 
 when the time comes that that "line" is thrown out, the prod- 
 uct no longer salable, and the machine has to be scrapped, the 
 man, too, is scrapped— turned out to look for another job in his 
 line of work, which no longer exists. 
 
 The monotony, the dearth of opportunity to learn anything 
 and the lack of incentive to initiative created by automatic ma- 
 chinery enslaves the workman. He becomes merely a cog in the 
 machine. His wages are small and his prospects smaller. He 
 is apt to turn to socialism, but he turns in vain, for the public, 
 the whole public demands the greatest value for the lowest price, 
 as he does himself for the goods he needs for his own use, and 
 standardization, the IMoloch of industry, continues to demand 
 
 its victims. 
 
 iModern conditions are relentless developing efficiency. In- 
 efficiency, whether in men, machinery or methods is being elim- 
 inated. ' The man who can do one thing well is taking the place 
 of the man who can do two things well, simply because, having 
 learned one thing, he went to work at it and gained an advan- 
 tage while the other was learning to do the second thing well. 
 
 And inefficient methods, like inefficient machines and men, 
 are going into the scrap heap just as rapidly. The old order 
 in which a workman after learning his trade became a foreman 
 and then the o\\Tier of a shop, is obsolete. Such a system, while 
 it insured a thorough understanding of all details by the head 
 of the house, produced an establishment in which the head, after 
 spending years learning the mechanical end, had then to learn 
 the wholly different business of getting business. Such estab- 
 lishments have been superseded by those in which a competent 
 workman who might not have had the initiative to start his own 
 business, but who has sufficient ability and experience to be a 
 foreman, is placed in that capacity, while the proprietor devotes 
 himself entirely to securing orders, thus building up a large 
 business before the master workman Avho becomes a proprietor 
 has worked his way up. 
 
 The old method of apprenticeship is passing too. The ap- 
 prentice, after several years, learned his trade and became a 
 journeyman, capable of doing a large variety of things, know-
 
 188 THE PRICE OF INEFFICIENCY 
 
 ing, in fact, all branches of his trade. He was taught by the 
 foreman and gained his experience in the routine of the shop. 
 He was admirably competent, but he is no longer in evidence. 
 Modern methods do not require so much knowledge and such a 
 variety of skill in any single workman. He may know how to 
 do fifty things well, but fifty such workmen will accomplish no 
 more than fifty others, each of whom can do but one thing well, 
 while each of the latter will have learned his specialty in a few 
 months or weeks, perhaps, instead of by years of apprenticeship. 
 
 The foreman, too, finds that his time can be more usefully em- 
 ployed than in teaching apprentices. He demands workmen 
 already trained and wants to be interrupted by no pupils. 
 
 The labor unions, too, who of all men make the most system- 
 atic and successful efforts to stand in their own light, as well as 
 the light of everyone else, restrict the number of apprentices, 
 with an idea of producing a scarcity of skilled workmen. "With 
 a fatuity so complete as to be almost admirable, they often limit 
 the number of apprentices in certain trades to one for each 
 shop, irrespective of the number of men working in the shop. 
 This prevents if it does not reduce the number of skilled workers 
 in the particular trade. The wages of the remainder are ac- 
 cordingly enhanced and all seems well. But the increased wages 
 attract the attention of young men, who find, however, that it 
 is a very difficult trade to enter, and that the employers would 
 take on more men if they could get them. The action of the in- 
 creased wages being to stimulate the interest of those casting 
 about for occupations, and there being a demand for instruction 
 in that line, the trade school is produced. Here the workman, 
 by specialized methods, can learn a trade in a few months that 
 would take him years to learn as an apprentice, as he is taught 
 systematically and does not pick up his knowledge at random 
 while performing minor operations of manufacture and sweep- 
 ing up the shop. 
 
 The trade school is thus a cheaper and a quicker system of 
 instruction than the old method. It supplies the modern fac- 
 tory with workers who have learned their trades at small ex- 
 pense, and who can afford to work cheaply. 
 
 The action of the unions in having forced an increase in wages 
 through restriction in the number of those engaged in a trade, 
 causes the products to be more costly. For this the public pays. 
 But capitalists, seeking opportunities for profit, and finding out 
 that articles of that class are selling above the natural price
 
 INDUSTRIAL HANDICAPS II 189 
 
 are anxious to enter the business. The trade school graduates 
 in that line cannot enter the union shops, and the new capital- 
 ists cannot get union men to man the new factories they build. 
 The new capital and the new labor in the field are thus thrown 
 together, and the new factories by producing the same articles 
 at a lower cost undersell the union factories, and the unions be- 
 ing unwilling to make concessions, the old factories are ruined 
 and the union men find themselves without employment. Their 
 arbitrary efforts to defeat the natural laws of supply and de- 
 mand are thus inevitably defeated. Labor unions have been 
 most successful in the newspaper trades of typesetting and 
 manufacture, for the reason that the price of the product must 
 remain the same whatever the cost of labor, while the proprie- 
 tor recoups himself in advertising charges, ultimately paid by 
 the public, but into which so many considerations enter that the 
 issue of the cost of labor can never be definitely met. But 
 wherever competition can force a direct issue, the labor union 
 is always defeated. Wherever a cost comparison can be def- 
 initely drawn, the labor union is lost. In railroading and 
 similar occupations unions are successful. They have at all 
 times less to fear from the competition of other men seeking 
 work than they have of the public seeking cheaper products. 
 
 "Scientific management," a recent and high-sounding name 
 given to the common-sense policy of shop efficiency, is also bit- 
 terly opposed by the labor unions. It amounts to a conservation 
 of energy, and consists in reducing the number and diffi- 
 culty of the bodily movements necessary to perform any given 
 task. 
 
 Thus a bricklayer, by standing in a certain position, having 
 his bricks placed on a platform at a selected level and adopting 
 a certain sequence of movements, can lay three times as many 
 bricks in a day as one who goes at his task in the usually in- 
 convenient manner, and not be any more fatigued by his work 
 if as much. A house built in such a manner is much less ex- 
 pensive than by the old methods, and were all houses so built, 
 rents would be greatly reduced. Yet the bricklayer can only 
 see the point that by producing three times as much work, he 
 will be out of work three times as quickly, and he therefore 
 adopts the opposite plan, restricting his output as much as pos- 
 sible. All other trades follow a similar policy, for except on 
 piece work, it is almost the universal custom among working- 
 men.
 
 190 THE PRICE OF INEFFICIENCY 
 
 If as a body they understood the advantages of efficiency, 
 with the consequent cheapening of products, and doubled their 
 output, an enormous effect would be produced. 
 
 If, for example, a million coats are made daily, and the 
 makers increased their product to two million without any ad- 
 ditional cost of labor, the cost of coats would be greatly cheap- 
 ened. But if carried out, practically half the coat makers would 
 be thrown out of work, a calamity more obvious than real, as 
 they would be able to find work in other lines while the coats 
 of all would be much cheaper, including their own. In fact, 
 for each w^orker, the consequent cheapening of coats for the re- 
 mainder of his life would be in itself more than compensation 
 for the loss of his position. 
 
 The same process applied to all trades would throw half the 
 workers out of employment sooner or later, depending on the 
 time consumed in arriving at the new condition. But though 
 half the workers were thrown out of work, the cost of living 
 would be reduced to half its former figures, so that the con- 
 dition of the whole would not be any worse while the necessity 
 of women and boys under eighteen working would not exist. 
 The whole family of the laborer could live on his earnings, in- 
 stead of, as at present, having to work to make up the industrial 
 deficiency caused by his ignorant attempt to get the best of his 
 employer. 
 
 The labor unionist, however, will argue that if the worker 
 doubles his output, it will throw half of his fellow workmen 
 out of work and that the consequent over supply of labor will 
 result in the unemployed half competing with the employed 
 half, with the result that all are reemployed, but each at half 
 the former wages to turn out twice as much in products as 
 before, not a pleasant prospect for the laboring man. Even 
 admitting that such would be the case, the cost of production 
 would by this process be reduced to one-fourth the present cost, 
 for ultimately labor is the only item that enters into the cost 
 of any article of commerce. The cost of living, being reduced 
 thus to one-fourth its previous figure, the worker working for 
 half his former salary would be twice as well off as at present, 
 for his reduced salary would buy twice as much as it does now. 
 He would be twice as well off for the simple reason that he 
 would be doing twice as much work. The laborer cannot, con- 
 sidered as a body, divest himself of the fruits of his toil any 
 more than he can permanently obtain a greater compensation
 
 INDUSTRIAL HANDICAPS II 191 
 
 than that to which he is entitled by natural laws, no matter 
 what scheme or device he employs. 
 
 Consider on the other hand that the labor unionist were to 
 be able to obtain double their present wages for doing half as 
 much work. The cost of all products would be quadrupled im- 
 mediately, but the wages of the worker being only doubled, he 
 would be in a position only half as advantageous as at present. 
 Some such process as this has taken place in the last generation 
 throughout the world. The workingman has become filled with 
 false ideas as to his rights and privileges and what his labor 
 entitles him to, and with everyone else, he is to-day reaping the 
 bitter harvest. Wealth is nothing but accumulated work and 
 the more work that the individual can do, the richer will be the 
 world. By the not very great addition to work of increasing 
 its value a dollar a week, the wage earners of the country in 
 twelve months w^ould produce value equivalent to the entire 
 fortunes of Morgan, Carnegie, Rockefeller and a half a dozen 
 other of the richest men in the country, and give such an im- 
 petus to prosperity that hard times would be a thing of the 
 past for years. 
 
 No worker working for himself ever restricts his output. But 
 the worker imagines that in working for his employer he is 
 working for someone else. Such is not the case. The public 
 is composed of the public, not of strange gods or wealth de- 
 vouring ogres, and work is always wealth. The worker's living 
 expenses are certain, and more or less fixed. If he works twice 
 as much he produces twice as much value. It goes somewhere. 
 Into the pockets of capital, the laborer thinks, but this is not 
 the case. As little popular sympathy as it arouses, competition 
 among dollars for jobs is just as keen as among workers. Cap- 
 ital quickly flows into new and profitable enterprises and deserts 
 old ones. If a moving picture theater makes money, a dozen 
 others spring up to cut down the profits of the first. If a 
 foundry or a factory in a certain line is very profitable, there 
 is a rush to get into that business. Money is subject to the laws 
 of supply and demand just as labor is. Everyone wants money, 
 but few demand it so strongly as to pay 100%' interest. In fact 
 6% is about the ordinary wages of money. The more money 
 there is, the lower the rate of interest. Capital thus measures 
 its own return by the amount of it in existence, the more capital 
 the less return, just as labor is measured, the more laborers, the 
 lower the wage.
 
 192 THE PKICE OF INEFFICIENCY 
 
 The worker who is apparently making his employer richer by 
 working twice as hard, is in reality working for himself, for 
 although the employer may temporarily become richer as an in- 
 dividual, it gives him money which he must invest and throw 
 into competition with money invested in other businesses or in 
 his own. If he enlarges his plant, the worker is surer of em- 
 ployment. If some other manufacturer from some other field 
 invades the field, the worker has a choice of employers, he is in 
 fact competed for by the very wealth he has created in his own 
 increased efforts. The enormous mass of fresh capital produced 
 by a new point of view of the worker would in competing with 
 existing capital reduce the cost of necessities. The wage earner 
 would thus be deriving the benefit, since his wages though not 
 increased would have an increased purchasing power. 
 
 Capital has certain limits of profit, just as labor has. Each 
 takes its natural proportion in accordance with the relative 
 amounts of each in existence. Thus the worker, by more effect- 
 ive efforts, when he increases the amount of money in other 
 peoples' pockets, is improving his own condition by creating new 
 purchasing power for his products, and is increasing his wages 
 through reducing the relative returns to capital caused by his 
 own efforts in bringing more capital into existence. He be- 
 comes vastly more valuable to himself, to his employer and to 
 the world than in his previous condition. 
 
 Yet practically throughout the world, especially in English- 
 speaking countries, the worker restricts his output. The new 
 system of "scientific management" is violently opposed, yet it 
 involves no more fatigue than present methods while producing 
 much greater results. What it amounts to is a study of the 
 bodily movements with a view to eliminating those which are 
 superfluous or awkward, so that a worker at the end of a day 
 has made no greater number of movements than ordinarily, and 
 has expended no more strength, but his strength and his move- 
 ments have been productive ones. Indeed, owing to the waste 
 motions being eliminated, the amount of work done is often less. 
 Even the housekeeper can introduce a little ''scientific manage- 
 ment" in the kitchen by the erection of a new shelf to save steps, 
 by sweeping with a certain motion or by allowing the dishes to 
 remain in hot water for a time before washing them. Scien- 
 tific management is merely common sense applied to the daily 
 task. The vast amount of wealth that dies still born in the fac- 
 tories of the world every day is almost incalculable. In the
 
 INDUSTRIAL HANDICAPS II 193 
 
 United States there are 7,017,138 wage earners in factories, 
 according to the 1908 governmental report, ' ' Earnings of AVage- 
 Earners. " 
 
 The census of manufacturers of 1905 reported 216,262 estab- 
 lishments, of which 19,679 reported no wage earners in employ- 
 ment, leaving 196,583 to be investigated in connection with the 
 report on weekly earnings. The returns from 72,880 of the es- 
 tablishments were so defective or unsatisfactory that they could 
 not be used. Of the remaining 123,703, or 62.9% of the whole 
 number having wage earners, the reports enabled the prepara- 
 tion of most interesting deductions. 
 
 The inquiry called for the segregation of wage earners ac- 
 cording to groups of actual earnings, and not rates of pay ; and 
 therefore the distribution gives the actual numbers that earned 
 the specified amounts during the week covered by the report. 
 The terms "wages" and "earnings" are frequently used 
 synonomously. Earnings and not rates of wages, either actual 
 or other, are given in the report. The totals include piece work- 
 ers, and cover all branches of employment in the manufacturing 
 industries of the country, exclusive of the office force. 
 
 Of the 3,297,819 wage earners covered by the investigation, 
 2,619,053, or 79%, were men; 588,599, or 17.9%, were women; 
 and 90,167, or 2.7%, were children. 
 
 The pay rolls of the 123,703 establishments for the week cov- 
 ered amounted to $33,185,791, and of this, men received' $29,- 
 240,287, or 88.1%; women, $3,633,481, or 11%; and children, 
 $312,023 or nine-tenths of 1%. 
 
 As each establishment was requested to report the actual 
 number employed during the week and the actual amount paid 
 that number, it should be safe to use the above totals to com- 
 pute the average earnings for the week. They give $10.06 as 
 the average weekly earnings for all classes of wage earners dur- 
 ing the selected week, and $11.16, $6.17 and $3.46 as the aver- 
 ages for men, women and children respectively. 
 
 The classification shows the concentration of men at the higher 
 and of women and children at the lower weekly earnings. More 
 than one-half (55.5%) of all the wage earners received $9 and 
 over per week. Two-thirds (66.6%) of the men received $9 
 and over for the week, while only one-seventh (14.1%) of the 
 women were paid at this rate. The children receiving $9 and 
 over were so few that they are included in the general tabula- 
 tions with those receiving $8 and over.
 
 194 THE PRICE OP INEFFICIENCY 
 
 Tlie greatest number of wage earners, namely, 464,875, make 
 from $12 to $15 per week, while some 132,064 make less than 
 $3 per week. 
 
 From a consideration of other tables given in this report, it 
 is estimated that about 3,000,000 wage-earners are so employed 
 that by the adoption of intensive work, they could greatly in- 
 crease their output. The other wage earners are so employed 
 that their output could either be but slightly increased or not 
 at all. But the output of the 3,000,000 could readily be in- 
 creased 50%, and at the average wage of all factory workers, 
 approximating $9 a week, this would mean a saving of $2,340,000 
 a day or the vast total, figuring 300 working days in the year, 
 of $702,000,000. That is, there is that much money wasted in 
 misdirected efforts every year, by far a larger item than any 
 that has been made in any computation in reference to the con- 
 servation of the country's resources. 
 
 The census of 1900 showed 29,287,070 persons, ten years of 
 age and over, as engaged in gainful occupations, and assuming 
 that the average weekly wage is $6, and omitting the 3,000,000 
 factory workers already referred to, the application of intensive 
 work to the extent of only 10%, would mean an increase 
 of sixty cents a week for 26,000,000 workers, or $2,704,000 a 
 day. 
 
 In whatever employment the worker may be engaged, an in- 
 crease of 10% efficiency may be obtained, and in most cases 
 very easily obtained without any additional effort at all. In 
 three hundred working days, the 10% increase would mean 
 $811,200,000, which with the factory increase mentioned, makes 
 a total of $1,513,200,000. 
 
 This vast sum that might be added to the wealth of the coun- 
 try annually, would be like quarts of blood transfused into the 
 veins of an ana?mie ; where there is now financial lassitude, ac- 
 tivity and vigor would result ; where credits are restricted and 
 capital wanting, there would be energy and prosperity. The 
 attitude of antagonism, the fear that someone else will become 
 too prosperous, jealousy of the success of others and particu- 
 larly of those who are in the position of employers, brings mis- 
 fortune for all. 
 
 The man who devotes himself to schemes for preventing others 
 from making money, will never have the time to make much 
 for himself. 
 
 Almost as bad as this grudging of effort in its costliness to
 
 INDUSTRIAL PIANDICAPS II 195 
 
 humanity, is the time lost in strikes, the most direct expression 
 of the differences between capital and labor. 
 
 The waste of grudging effort, or as is often the case, simply 
 the inefficient or " what 's-the-use " failure of the worker to put 
 forth his best effort, lies in the feeling that no one else will do 
 so. There is an utter lack of co-operation and concerted effort. 
 
 A group of laborers tugging at a timber will not move it 
 luiless there is a concerted effort. It is then moved with little 
 trouble. 
 
 A method of introducing a concerted effort in intensive work 
 needs to be devised. If all workers knew^ that on a certain day 
 all other workers were going to put forth extra efforts, it would 
 have the effect of contagious enthusiasm, and even the most in- 
 dolent would be "on the job" on such a day. What the coun- 
 try needs thus, is a tuning up or period of forcing, a time dur- 
 ing which prodigious efforts are to be made; after which the 
 greater effort would become a habit, and the previous method, 
 a remembrance as of the dreaded tasks of childhood. 
 
 Perhaps the only time the w^hole country has engaged in a 
 concerted and prearranged effort, was the cessation of all activ- 
 ity for one minute at the time of the funeral of President Mc- 
 Kinley, when all transportation and work was stopped. This 
 had a great psychological effect. 
 
 A concerted effort of this kind to initiate a new attitude to- 
 wards the day's work could not fail to have an enormous effect. 
 
 While such concerted action might prove an immediate ex- 
 pedient and a starting point, a more permanent change of 
 the point of view is necessary. There must be systematic train- 
 ing. The right direction must be given and the sense of re- 
 sponsibility to humanity made a part of the technical training 
 of all. 
 
 Each one should be taught to do his part for the sake of the 
 rest of the world as well as for himself. The spirit of mutual 
 helpfulness on the part of all concerned should take the place 
 of animosity and jealousy. 
 
 One of the secrets of German success lies in the mutual help- 
 fulness mutually exercised by the government, the employers 
 and the employees. 
 
 Mr. W. H. Dooley in the Atlantic Monthlij, May, 1911, de- 
 scribing "German and American Methods of Production," 
 says: 
 
 "The German government recognizes the duty, and exercises
 
 196 THE PRICE OF INEFFICIENCY 
 
 the right, of regulating industries in the interest of the em- 
 ployed ; but in doing so, it is careful to keep in view the general 
 industrial interests. The German laws are consequently in 
 many respects much less stringent than ours, which seem to 
 have been enacted under spasmodic influences without any 
 guiding principle. This may be explained by the fact that the 
 German government has been obliged to foster industries, and, 
 in order to do this effectually, must strike in its legislation a 
 happy medium between the claim of the employed for protec- 
 tion, and that of the community at large for the promotion of 
 industrial enterprise. 
 
 "The most stringent regulations passed by the government 
 are those affecting children and women, and it is in this respect 
 that the state has clearly in view the interests of the community 
 as represented by its workers. The total number of children 
 under fourteen years employed for special reasons and exempt 
 by law in the manufacturing industries in Germany is about 
 1630. These children are between thirteen and fourteen, and 
 the hours of employment are restricted to six, with half an hour 
 interval for meals. Between fourteen and sixteen they may 
 work not more than ten hours but they must have an hour's 
 pause at midday, and half an hour both in the forenoon and af- 
 ternoon, unless their working day is not more than eight hours. 
 No continuous period exceeds four hours. During the rest 
 periods, any participation in work is forbidden, even remaining 
 in the work room is allowed only when their o\^^l department 
 of the work is brought to a complete standstill. 
 
 "When past eighteen, they cease to be youthful workers, and 
 are under no special regulations except that all under twenty- 
 one must be provided with a 'work-book,' or register, contain- 
 ing name, age, birthplace, nature of employment, date of en- 
 gagement, discharge and other particulars. All boys under 
 eighteen are obliged to attend a continuation school for nine or 
 ten hours during the week where they receive instruction in the 
 technical knowledge of their trade and religious instruction 
 from their own clergj^man. This time is taken out of the regu- 
 lar day-work without loss of pay. In a number of larger engi- 
 neering and machine shops, the writer saw no youthful workers. 
 
 "Workmen may be fined to the extent of one-half of their 
 earnings, except in the cases of acts against fellow workmen, of 
 offenses against morality, or of those against regulations, main- 
 tenance of order and of security, when fines may be imposed
 
 INDUSTRIAL HANDICAPS II 197 
 
 to the full extent of the earnings. All fines must be applied 
 to the benefit of the workers, and generally go to the sick fund, 
 but this does not affect the right of employees to obtain com- 
 pensation for damages. All particulars of fines imposed must 
 be entered in a book, which is open to inspection by a govern- 
 ment officer. 
 
 "Every industrial establishment must have a set of rules 
 hung up in an accessible place in each department, stating the 
 hours of work, with the regular interval for meals, the time and 
 manner of paying wages, the length of notice terminating em- 
 ployment, and the conditions under which notice is unnecessary ; 
 also particulars of punishment, including fines, and the objects 
 to which they will be applied. 
 
 ''Punishments which wound self-respect or offend morality 
 are inadmissible. These rules are equally binding on employer 
 and employed, but before they are issued, opportunity must be 
 given to adult workers to express their views, and the rules to 
 w^hich objections are made must be submitted within three days 
 of issue to the factory inspector, who may order amendments if 
 they are not in accordance with the law or with special regula- 
 tions. Punishments not provided for in the rules cannot be 
 imposed, nor can other grounds of dismissal be included in the 
 contract. 
 
 "It is a rare thing for a firm to have any difference with its 
 workmen. Indeed, I was definitely informed by one firm that 
 there had been only five cases of dispute in nine years, and these 
 did not come from the worlmien as a whole, but were cases of 
 individual complaint. They have in Germany an institution 
 corresponding to the Conseil des Prud 'hommes, in France, which 
 they call Gewerbe Gerichte, to which are brought all cases of 
 disputes of employees and employers. The average number of 
 cases tried by this bureau never exceeds five hundred a year. 
 The bureau consists of five or three people. The government 
 appoints a chairman who is a lawyer, and there are representa- 
 tives of the employer and the employee also appointed by the 
 government. Sometimes two are selected instead of one. Their 
 decision is not final, as is that of the arbitration board in this 
 country. If a workman or employer does not accept this de- 
 cision, it is binding for only two weeks. Then the workman 
 may leave, or the employer may discharge him. To give an 
 illustration: One of the workmen in an engineering firm thinks 
 he should receive four marks more a week in wages. He goes
 
 198 THE PRICE OP INEFFICIENCY 
 
 to the firm and makes the demand. They refuse him. He ap- 
 peals to the Gewerbe Gerichte. The Gewerbe Gerichte says, 
 'No, do not pay it.' The workman can leave at the end of two 
 weeks' notice; or, if the decision is given in favor of the work- 
 man, the firm is obliged to pay him the increase for at least two 
 weeks, and then they may give him a fortnight's notice to quit." 
 
 It may be noted here that employers seldom discharge em- 
 ployees after appeals to the Gewerbe Gerichte. Indeed, they 
 avoid as much as possible having employees appeal to it. To 
 disregard its decisions in effect gives the firm a bad reputation, 
 and to be before it is somewhat similar in damaging effect to 
 the summoning of a lawyer before the Bar Association in New 
 York. 
 
 Mr. Dooley continues: 
 
 "Notice of termination of employment is usually a fort- 
 night, but it may be dispensed wdth on the part of an employer 
 on the following grounds : false representation, theft, or other 
 criminal acts; leaving work without permission, or refusing to 
 fulfill the contract; carrying fire or lights about, contrary to 
 orders; acts of violence or gross abuse directed against the em- 
 ployer, his representatives or family; willful damage; inducing 
 member of an employer's family or his representatives, or fel- 
 low workmen, to behave in a manner contrary to law or moral- 
 ity; inability to continue work; or an alarming disease. Notice 
 may be dispensed with by the workers on corresponding 
 grounds; also for non-payment of wages in the prescribed man- 
 ner; neglect to provide sufficient work for piece workers; or 
 some danger to life and health in the employment which could 
 not be inferred from the contract. 
 
 "The rate of wages is not included in these rules. The ex- 
 istence of such a code, legally binding on employers and em- 
 ployed, is a characteristically German method of doing business ; 
 it is in accordance with that respect for law and order which is 
 such a marked feature of German life, and contributes materi- 
 ally, no doubt, to the smooth working of German industries. 
 The rights and obligations of 'work-giver' and 'work-taker,' to 
 use the excellent German terms, are publicly defined and guar- 
 anteed by law. This conduces to tranquillity, and makes at- 
 tempts at individual bullying or vague talk about 'rights' pal- 
 pably futile." 
 
 The training thus given the German worker is such that he 
 respects his work and is willing and anxious to do it thoroughly
 
 INDUSTRIAL HANDICAPS II 199 
 
 and for its own sake. This is the foundation of efficiency. 
 When a task is well done, no one can profit by it as much as the 
 man who does it ; none can take from him the sense of pride and 
 satisfaction which it creates, and though the employer profits 
 apparently more in a financial way, in the end natural forces 
 w'ork themselves out in such a way that each receives the com- 
 pensation to which he is entitled under the circumstances. The 
 channels of iudustr}^ may be fouled and obstructed at certain 
 places and at certain times, but the level of recompense for the 
 worker and the employer is justly reached in time. 
 
 A national society has recently been organized in the United 
 States, composed principally of four groups: men of affairs, 
 members of university faculties, specialists in accounting and 
 efficiency engineers, the purpose of which is to promote effi- 
 ciency. The names of the organizers are among the most promi- 
 nent in the country in their respective groups. The movement 
 for the formation of such a national society seems to have 
 come at the moment of maximum effect. Nothing ever at- 
 tempted in this direction (and there have been several attempts 
 during the past ten or fifteen years) took such instant and un- 
 mistakable hold on the enthusiasm of those whose co-operation 
 was invited. 
 
 The Engineering Magazine writes: 
 
 "Probably the catholicity of view and interpretation that 
 mark the new society has much to do wdth its evident power to 
 enlist support. It has very clear ideals to advance, but no 
 special system to exploit. It recognizes the financier, the com- 
 mercial manager, the accountant, the educator, the engineer, as 
 co-ordinated powers, each potent in his own field, to originate 
 and direct effort toward conservatism, toward reduction of the 
 preventable waste of money, time, energy, of physical and human 
 resources, that now burdens our struggle toward greater pros- 
 perity. It accepts any conscientious discipleship and works 
 contributing to this purpose, and places all emphasis on prin- 
 ciples of faith and none on points of ritual. 
 
 "Better concepts of efficiency are indeed sorely needed 
 everywhere. Attention has been focused upon inefficiency in 
 railroad operation and thence reflected upon inefficiency in man- 
 ufacturing, although in every probability efficiency is far higher 
 in either of these fields than in departments that hold themselves 
 much above commerce and transportation — the law for example. 
 
 "Consider the McNamara trial as an object lesson. The
 
 200 THE PRICE OF INEFFICIENCY 
 
 prospective jury held in jail, and the panel generally shadowed 
 and investigated by detectives; counsel taking days to examine 
 one talesman, announcement made that each side will take thirty 
 minutes to sum up, not the case, but the question of a single 
 juror's acceptability, and all ending in nothing; six weeks esti- 
 mated to be necessary to filling the jury box alone. 
 
 "Louis Carroll, collaborating with Gilbert and Sullivan, 
 could have imagined nothing more frantic. 
 
 "When the larger fraction of our legislature is drawn from 
 professions in which the great fundamental efficiency principle 
 of common sense can be grotesquely ignored, it is not surprising 
 that much of our legislation should lack this and other princi- 
 ples of efficiency; should uphold mistaken ideals, fail to enforce 
 discipline and violate the fair deal. And when the car of jus- 
 tice takes to the mire, the wheels of industry also are clogged. 
 Perhaps the attempt to enforce the Sherman law may prove its 
 reducHo ad absiirdum; but the present spectacle is disturbing. 
 The attempt to remedy specific wrongs by general legislation 
 leads to results wholly unforeseen and chaotic. We fulminate 
 against forms of organization because they permit wrongs to be 
 done, and let actual wrongdoing go unredressed and unpun- 
 ished. Everj'where we grapple mth forms and miss the sub- 
 stance. Surely some great organized movement for efficient 
 common sense is fully due! 
 
 "In marked contrast to the confusion wrought by the lawyer- 
 politician in attempting to regulate industrial affairs, there are 
 beginning to appear, here and there, clean-cut exhibitions of 
 wholesome ideals and efficient performance in political office 
 where the influence of the engineer and the experienced indus- 
 trial manager has had opportunity to make itself felt. • 
 
 "Visitors to the Budget show in New York city (not generally 
 thought of as having a model city government) are strongly 
 impressed with the extent to which the standards and purposes 
 of conscientious and economical performances are being upheld 
 by many of the men in the engineering departments; and the 
 administration of the affairs of a large city is increasingly a 
 matter for engineers to control. From Chicago comes a note 
 that the Civil Service Commission has ordered examinations 
 for positions of 'expert on system and organization' and 'ex- 
 aminer of efficiency' and that to secure technical men of the 
 highest grade to fill the positions, local residence has been 
 waived. The methods appearing in some of the work done under
 
 INDUSTRIAL HANDICAPS II 201 
 
 the state government of "Wisconsin are described bj^ a competent 
 engineering critic as inspiring. And in Federal affairs, a new 
 concept of the relations between government and industry is 
 thus impressively voiced by Congressman William C. Redfield : 
 
 " ' If the American makers of goods would practice the modern 
 idea of scientific management, or greatest possible efficiency, no 
 tariff wall would be needed to protect them from competition. 
 This principle we may safely lay down ; manufacturers must 
 go to the limit of self-help before they can ask the public to 
 tax itself to keep them. No tariff can righteously cover costs 
 arising from mistakes in management, errors in location, bad 
 equipment, faulty methods or neglect to adopt the most modern 
 system of cost keeping and supervision.' This represents the 
 best genius of constructive political effort. 
 
 "When such leaven is working in municipal, state and national 
 governments, it gives courage and hope for the ultimate leaven- 
 ing of the whole mass. ' ' 
 
 ''Scientific management" is a fine phrase of recent origin and 
 quite unknown in Germany where the results so accomplished are 
 merely regarded as the results of common sense practice and are 
 not considered worthy of being so brass banded. Motion study, 
 a phase of the same subject, is likewise a matter of course in 
 Germany and the author recalls that during his extended shop 
 practice in the early 90 's with a concern employing some 14,000 
 men, he was taught w^hat is now discovered to be motion study, 
 by a superintendent who had been practicing it for forty years. 
 
 Quite as innocently the author had occasion, in this country, 
 some years since (1904) to recommend certain changes in the 
 operation of plants, effecting in one instance a saving of $50,000 
 and in another a saving of over $200,000 a year, without realiz- 
 ing that proceedings of such kind would come to be known as 
 "scientific management," and not only so known but regarded 
 as a newly made discovery, and trade marked with the names of 
 so called originators. 
 
 Many other methods now in vogue in Germany are doubtless 
 similarly destined to "discovery" here.
 
 CHAPTER XIV 
 HOW TO SUPPLANT THE TRUSTS 
 
 A NEW METHOD OF REVIVING SMALL INDUSTRIES. 
 
 How the trusts have ground out the small manufacturer — The cumber- 
 some but crushino- system of the trust — How it may be opposed by ag- 
 gregations of individuals — A new field for bankers in establishing com- 
 munal manufacturing plants — Solving the problem of working capital 
 — Advantages in extending and obtaining credit — Cheapening the cost 
 of supplies — Furnishing tlie sinews of competition — Convenience to the 
 public — Advantages in purchase of coal and raw material — Special 
 facilities and testing apparatus — Quick and efficient service rendered 
 to the public by comnumal manufacturers — Stimulating effect on work- 
 men — Better facilities for odd jobs — Saving in transportation charges 
 and delays in local deliveries — Communal bookkeeping — Incentive of 
 the banking interest — Certainty of financial success — Cumulative ef- 
 fect of advertising — Elimination of the middleman — Example of auto- 
 mobile manufacturing on a communal system — Superiority of product 
 over that of a trust owned plant — Impossibilities of the trusts with- 
 standing the competition of communal groups — Great value of good 
 will to the communal manufacturer — Beginnings of the system — How 
 small cities could establish such a system — iloderate investments re- 
 quired — Importance of competent engineering — Great advantage to the 
 city seeking to promote its growth — Psychological effect on workmen 
 — The yeast in the industrial loaf — The small manufacturer as a neces- 
 sity in the scheme of industrial organization — The true selling price 
 of every article — The greatest of industrial forces. 
 
 In the battles of modern industry, the small competitor is con- 
 stantly being vanquished by the larger rival. The latter has 
 the superior resources and the small manufacturers gradually 
 disappear, unable to compete in efficiency with the larger ones, 
 and a condition finally results in which the activities of an in- 
 dustry are carried on by a few large manufacturers and a num- 
 ber of isolated, struggling repair shops. 
 
 The large factory, however, works under certain disadvan- 
 tages. Its organization is necessarily cumbersome and much red 
 tape is involved. It cannot serve its customers as expeditiously 
 and it confines itself to certain lines of goods and makes no at- 
 tempt to supply goods for which there is only a limited demand. 
 
 202
 
 HOW TO SUPPLANT THE TRUSTS 203 
 
 It suffers all the evils of standardization, which are referred 
 to in the previous chapter, and it is usually rigid in operation and 
 slow to adopt new ideas. 
 
 The small factory serves the customer in much better ways 
 than the large one. His patronage is more necessary to its ex- 
 istence and it is far more adaptable to his wants. 
 
 Yet in spite of its many admirable features, the small factory, 
 lacking specialization, capital and equipment, cannot compete 
 in cheapness Math the larger units, and is constantly being 
 driven out of existence. 
 
 A system whereby the small factory may bo able to get into 
 the field again is being attempted in Germany on a small scale, 
 here and there, while the same principle is being applied in 
 New York to a limited extent in warehousing and factory build- 
 ings. It has already attracted considerable attention and if 
 developed along the right lines may very quickly become a 
 Daniel in the industrial battle, slaying the Goliath of the trusts, 
 and a means of quickening again industrial activity through the 
 revival of competition in effective form. 
 
 It is a system especially inviting and adaptable to small cities 
 desiring to increase their prosperity. They will be the most 
 likelj' backers for it, and will find in it a highly effective 
 weapon. 
 
 The system is in principle a communism of facilities on the 
 part of the small manufacturers, preserving competition in the 
 market. By a lumping together of themselves as manufacturers 
 into producing groups, while maintaining their identity as in- 
 dividuals in their relations to the public, they can compete suc- 
 cessfully with the larger concerns and utilize in addition the 
 great force of individual initiative. 
 
 Under ordinary circumstances, the plan needs to be started 
 by a capitalist, banker or financier, whose purpose would be 
 to obtain a secure investment for large sums of money in what 
 may be considered a highly equipped real estate development, 
 rather than as an investment in a manufacturing concern. 
 
 A suitable district should be selected, having accessibility to 
 supplies of labor, convenience of transportation for w^orkmen 
 and customers, and, of the greatest importance, proper rail- 
 road and water terminals. At such a location, an enormous 
 factory building or series of buildings should be constructed, 
 designed especially to accommodate the industries intended to 
 be quartered there. The buildings should be subdivided to suit
 
 204 THE PKICE OF INEFFICIENCY 
 
 the needs of the individual manufacturers, each taking the space 
 and facilities best suited to his work. 
 
 The purpose of the banldng interests is best accomplished by 
 the organization of an operating company, in which the tenant 
 manufacturers have a share and a vote, and the duty of which 
 is to co-operate with the manufacturers in the administration of 
 the plant, to unify them as a purchasing unit, and to act toward 
 them as a supplier of working capital, the greatest need of the 
 small manufacturer. 
 
 If several hundred small manufacturers are thus grouped 
 together, the system of communism thus indicated would ad- 
 minister their affairs in a highly economical and efficient manner. 
 
 Among the advantages, the follo^^ang are the principal: 
 
 The unlimited capital and credit back of the group would 
 enable the individuals to secure the equipment necessary to 
 manufacture their products on long term payments, thus giving 
 them the means of adding to their manufacturing capacity as 
 rapidly as their business expanded, and not limiting their ca- 
 pacity, as it is at present with small manufacturers, to the 
 amount of new equipment that can be purchased either outright 
 or on ruinously high installment rates, out of profits as realized. 
 Equipment would include machinery, machine tools, dies, lathes, 
 furnaces and all kinds of labor saving machinery and devices. 
 
 The operating company would supply the necessary working 
 capital at fair rates of interest, advancing worldng capital on 
 the basis of orders in hand as security. "Working capital is one 
 of the great needs of the small manufacturer. On the receipt 
 of the order, he needs money to buy materials to be made up. 
 During manufacture he needs money to pay his workmen, and 
 after completion of the goods he must meet freight and delivery 
 charges and wait for from thirty to ninety days to be paid by 
 his customer, who in turn is waiting for the ultimate consumer 
 to take the goods off the shelves. 
 
 The small manufacturer's hands are too often tied by lack of 
 working capital to tide him through the manufacturing period. 
 Under such a plan as this, feeling secure in his supply of work- 
 ing capital, he is able to make closer prices, promise earlier de- 
 liveries and prompt deliveries, and offer discounts and credits 
 which enable him to meet the competition of the larger factories 
 on their own ground. 
 
 The operating company would have a credit department for 
 advising the individual manufacturers as to the reliability of
 
 HOW TO SUPPLANT THE TRUSTS 205 
 
 their customers, and this undertaken for the hundreds of manu- 
 facturers would result in a much more economical system of 
 ascertaining credit than could be put in force by the manufac- 
 turers acting individually. 
 
 In the collection of accounts also, the group would be able to 
 exercise a considerable power, since the credit of a merchant 
 being bad with one manufacturer, it would consequently be bad 
 with all, and a merchant thus purchasing various different kinds 
 of products from the several manufacturers of the group, would 
 be compelled to keep his credit good with the group to obtain 
 the superior advantages which they would have to offer him. 
 
 In the purchase of supplies, the group buying for all its mem- 
 bers would be able to command the lowest market prices, and 
 obtain the longest credits, where credits were desired, while the 
 individuals would be free to purchase what they chose in the 
 name of the group, enabling them to exercise their own individ- 
 ual abilities in purchasing, backed by the responsibility which 
 would accrue to them as members of the group. 
 
 It will be seen that in its fundamental financial features, the 
 group would be of the greatest possible service to its manufac- 
 turers, and would place them on a basis whereby they could 
 compete with any factory or trust, however great or powerful. 
 
 In its internal relations, the group would not be less effective. 
 It would have a staff of well trained business men, engineers 
 and master mechanics, who would be competent to advise the 
 individual manufacturers as to the best methods and machinery 
 to be employed in their respective industries. The small manu- 
 facturer would thus be aft'orded the same technical advantages 
 now enjoyed alone by the greater units. 
 
 This would result in the best possible arrangement of ma- 
 chinery and facilities for handling, manufacturing and deliver- 
 ing the product, and would ensure efficiency in operation and 
 production, while the business men as administrators would be 
 of assistance in arranging credits and promoting the business 
 of the various concerns. 
 
 A plant thus fitted for numerous small manufacturers, would 
 have for them many advantages over isolated locations, and 
 they would accordingly remove to it. It would also be particu- 
 larly convenient for the public, who would not have to go from 
 place to place in search of the articles they desired. The man- 
 ufacturers so grouped would thus have a considerable advantage
 
 206 THE PRICE OF INEFFICIENCY 
 
 over manufacturers whose locations were scattered throughout 
 the rest of the city in being more accessible. 
 
 The buildings being planned for the purposes intended, bet- 
 ter light and air would be obtained than in isolated plants, with 
 a consequently greater and superior output on the part of the 
 workmen. The janitor service would be effected with the great- 
 est economy and waste materials utilized to the fullest extent. 
 
 Through the purchase of coal for a single central station, 
 supplying light, heat and power to the whole plant, great econo- 
 mies would be put in force. The isolated manufacturer buying 
 light, heat and power as he does, must pay a profit to each of 
 the supplying concerns, while the grouped manufacturers would 
 receive their light, heat and power at cost. In this particular, 
 at present, the isolated small manufacturer suffers a great hard- 
 ship, since the electrical and steam concerns supply his larger 
 rival at an extremely low cost, to prevent them from installing 
 their own plants. This not only gives the large manufacturer 
 an enormous advantage, amounting in many cases to as much 
 as his rent, but it also kills at the outset the manufacture of 
 electrical machinery for isolated power plants. 
 
 The purchase of raw materials in quantities by the group 
 and distribution to the units at the wholesale price, would also 
 prove a great economy. 
 
 Tool rooms in common would be provided, saving each shop 
 the heavy cost of capital tied up in tools seldom used. Ma- 
 chine tools and machinery of such a nature as to be but seldom 
 used by any of the individuals, but occasionally very necessary, 
 would be provided in a central shop for the use of all, at an 
 equitable hourly charge, saving the units the investment in such 
 tools which is ordinarily required. 
 
 In this shop could also be included testing machines for test- 
 ing materials, a class of machineiy very seldom found in manu- 
 facturing plants, and not at all in small shops where most 
 needed. 
 
 If somewhat enlarged, such a department could take in out- 
 side work, as there are but a very limited number of such plants 
 throughout the country, and they are mostly connected with tech- 
 nical colleges, which do not take commercial work, needing their 
 facilities for their own researches. 
 
 Occasional work of great accuracy could thus be undertaken 
 by shops which would ordinarily be unable to attempt it. 
 
 A portion of the plant would be taken up by fully equipped
 
 HOW TO SUPPLANT THE TRUSTS 207 
 
 shops to be rented to the manufacturers ready for operation 
 for limited periods in cases where the manufacturers did not 
 wash to purchase machinery outright or on the installment plan, 
 and such shops could be utilized by inventors perfecting their 
 inventions, to the great benefit of all industries. 
 
 In the matter of repairs, both in the equipment of the shop 
 itself and in outside work, the facilities of the group would en- 
 able the best service to be rendered at the least expense and 
 delay. The public would find among a number of small manu- 
 facturers thus, means of having odd jobs done more quickly and 
 satisfactorily than in the case of large manufacturers. Their 
 varying wants could be much more readily served and new 
 business developed more rapidly than under present condi- 
 tions. 
 
 For the workman, the conditions would be highly stimulating 
 and beneficial. Work in a small shop is always of greater va- 
 riety and of a nature requiring greater initiative on the part of 
 the workman than in a large shop. In the latter the workman 
 is ordinarily confined to one particular operation. For the ap- 
 prentice, the small shop is much more desirable, as he learns 
 his trade more quickly and thoroughly than in a large shop. 
 
 The plant would have a labor bureau, enabling the workman 
 laid off in one shop to be shifted to another, and thus being 
 assured of practically permanent positions with working con- 
 ditions of the best, workmen could be had at lower wages than 
 in isolated plants, or at a given wage, a more efficient class of 
 men could be obtained. 
 
 Such a plant would contain reading rooms with trade journals 
 and technical books ; recitation rooms and lunch rooms, giving 
 workmen means of relaxation and enabling them to return to 
 work with fresh energy. 
 
 In cases of accidents which would be less frequent, owing to 
 precautions enforced by the group, medical attendance would 
 be at hand, and every aid given the worker, while the units of 
 the group would be better protected through insurance systems 
 against the financial cost of accidents. 
 
 The business routine of the plant would be performed by the 
 group, and bookkeeping and the details of routing and shipping 
 attended to by a few clerks for all. A manufacturer finishing 
 a product could turn it over to the department of shipping, 
 without having to bother with looking up the best freight rates 
 and tariffs. The plant enjoying the best obtainable shipping
 
 208 THE PRICE OF INEFFICIENCY 
 
 facilities and being practically a terminal freight station itself, 
 could forward its products with the least trouble and expense. 
 
 Loading would be on cars, right at the doors of the manufac- 
 turers. The group would also have a delivery system of its own 
 for local deliveries, serving in addition to its terminal facilities. 
 A most important saving would thus be effected, for the ex- 
 pense and trouble which is experienced by small business men 
 in making deliveries when they do not maintain a delivery serv- 
 ice of their own, amounts to nothing less than a species of ex- 
 tortion, and is not only a drain on profits, but a source of con- 
 tinual annoyance and friction to all concerned. 
 
 The shipping being attended to by the group, its system of 
 bookkeeping could readily be extended to include the opera- 
 tions of the individual manufacturers with the public. Thus 
 the employment of individual bookkeepers by each would be 
 avoided, and an important saving of clerical help accomplished. 
 
 The knowledge which the group would thus have of the opera- 
 tions of the individuals, would serve to protect both, and as the 
 purpose of the group would be to promote the welfare of the 
 group units, no inimical action would arise out of such an 
 arrangement. It would be somewhat similar to the accounts 
 which a bank keeps for its customers. 
 
 Indeed the whole relation of the group to the individuals 
 would be rather in the nature of the relations of a bank to 
 business men. The group would be essentially the banking or 
 moneyed interest, rather than an association of the individuals 
 in the form of a trade syndicate. The banking interest would 
 supply the capital, build the plant, provide the means of ob- 
 taining the equipment, and such additional service as bookkeep- 
 ing, expert advice, credit arrangements, shipping, and the like, 
 as supplemental features. It would be, in a way, a hotel for 
 industries in which the units instead of only getting a bare room 
 as in the case of isolated plants at present, would get the space 
 and equipment and such services as have been indicated, just as 
 the hotel guest receives much more when he rents a room in a 
 hotel than he would in renting an unfurnished room. 
 
 Among the beneficial activities of the group would be a de- 
 partment of information and publicity, preparing reports of 
 progress and results of work for the benefit of the units; com- 
 piling tables of market prices, and keeping in touch with tech- 
 nical developments and referring them to the units most inter- 
 ested in such matters.
 
 HOW TO SUPPLANT THE TKUSTS 209 
 
 In advertising, the products of all the manufacturers would 
 be advertised together as being manufactured in such a group. 
 This would add a trade mark value of importance to the prod- 
 ucts of each manufacturer, besides effecting a saving in the 
 rates and placing of the advertisements. Instances of com- 
 munal advertising of this general character are seen in the 
 cases of the manufacturers of a certain town who club together 
 and make the name of the town a general trade mark for goods of 
 a certain character. The name Grand Rapids is thus identified 
 with furniture and Oneida with underwear. Communal adver- 
 tising has a very marked effect and is a highly valuable form of 
 trade mark. 
 
 A communal group of manufacturers could accomplish great 
 results in the lines in which several kinds of products are manu- 
 factured by specialists but not sold to the public direct, being 
 combined by a final manufacturer into the product which the 
 public purchases, such as the manufacture of pianos and auto- 
 mobiles. 
 
 The purchaser of- an automobile, for example, gets a motor 
 made by one factory, a magneto made by another, horns, lamps, 
 wheels, shock absorlDers, radiator, ball bearings, hood, body, 
 frame, pumps, etc., each manufactured by a specialist and as- 
 sembled by the manufacturer owner of the trade mark name 
 under which the car is finally sold. Even the largest of the 
 manufacturers of automobiles secure portions of the mechanism 
 or equipment of their cars from other manufacturers. They thus 
 add these trade mark values to their own. The condition has 
 been created, partially by patents but more by the concentration 
 of effort in perfecting the separate devices. 
 
 In a communal group of manufacturers in which all the parts 
 of the automobile were manufactured by members of the group, 
 and the car sold as assembled. by the group, the highest degree 
 of efficiency would be achieved. As compared with a large fac- 
 tor}^ making practically the whole machine, the communal sys- 
 tem would amount to separate factories for making the parts, 
 w^hich would correspond to the separate departments of a large 
 plant. The individual shop owners, having so much more at 
 stake than the department foremen of the large plant, and be- 
 ing backed by equal capital and having equal facilities, would 
 turn out a better car at a lower price. They need not devote 
 their whole output to the car, but could sell the surplus to other 
 manufacturers, and they would have every incentive to supply
 
 210 THE PRICE OF INEFFICIENCY 
 
 their own car with the best and cheapest of material, as in the 
 division of profits of sale, they would participate in the pro- 
 portion that the cost of their product bore to the cost of the 
 car. 
 
 No trust could withstand competition of this sort, for the 
 initiative of a group of active individuals would be opposed on 
 equal terms to the inert mass of the large corporation, respond- 
 ing sluggishly to conditions and being poorly or inefficiently 
 served by its employees from top to bottom. 
 
 The communal group would be at a great advantage over 
 outside assemblying manufacturers working in isolated plants 
 and drawing their parts from other isolated manufacturers, in 
 the saving of freight costs and other charges, as well as by being 
 able to build up more quickly the trade mark and good will 
 value which would from the sympathy of the public and the 
 excellence of the communal car, so much more readily be com- 
 manded by the group. In the purchase of supplies, the group 
 would cut out the cost of the midlemen, and in the establish- 
 ment of sales agencies, reduce the cost of selling. In the saving 
 in overhead charges, such as fire insurance, depreciation, interest 
 and sinking fund, office expenses, etc., the communal system 
 with one plant, would possess great advantages over the charges 
 of a number of separate plants. 
 
 An illustration of the efficiency of the communal principle 
 is seen in some of the large department stores in the principal 
 cities of the country. In such stores, certain counters are 
 rented by individuals who own the goods on the shelves and 
 conduct the business, just as if the aisles were streets and their 
 own counters separate stores. The store as a whole has the 
 advantage of individual initiative at the various counters. Such 
 stores are of the most successful sort. 
 
 The principles of communal manufacturing are, as mentioned, 
 being carried out to a certain extent in New York in the form 
 of factory and storage buildings, the Bush Terminals. These 
 buildings offer exceptional facilities in light, heat, power, con- 
 venient construction and location at terminals, thus saving 
 drayage charges, while insurance is lessened and many other 
 advantages obtained. 
 
 It has even been proposed that New York city should take 
 over the Bush Terminal buildings, thus following the example 
 of German cities in their ownership of improved real estate. 
 This would be a form of municipal activity of a new sort for
 
 HOW TO SUPPLANT THE TRUSTS 211 
 
 American cities, but one that should in all probability, if fol- 
 lowed, prove of great advantage. 
 
 In the smaller cities particularly, great results could be ac- 
 complished by the promotion of communal enterprises. The 
 city furnishing the capital and site, could induce manufacturers 
 to locate there, owing to the superior advantages thus to be 
 enjoyed. At present, cities often offer free sites and freedom 
 from taxation for a certain period to induce manufacturers to 
 locate their factories with them. The offer of communal facil- 
 ities and the use of capital on fair terms, if it were a system 
 adopted by cities generally throughout the country, would pro- 
 duce most remarkable effects, as numerous new manufactories 
 fostered in this manner by municipalities would be able to com- 
 pete with and eventually break up the trusts. Such a plan 
 could be put in operation in a commission governed city with 
 little trouble and in such a city an efficient administration of 
 it could be expected. 
 
 It is obvious that legal measures will never effect much change 
 in the industrial situation as it exists. The trusts must be 
 beaten on their own ground, as manufacturing mechanisms. In 
 the communal plan, the much vaunted superiority of the busi- 
 ness methods of the trust could be met and overcome by the 
 superior initiative and efficiency and adaptability of the com- 
 munal manufacturers. 
 
 Nor does the plan necessarily involve a large investment to 
 institute. While the larger the number of factories together, 
 the better the results obtained, a communal group of even a 
 dozen or twenty manufacturers, requiring no great financial 
 backing, would suffice for a start in many places. Such groups 
 could be instituted in buildings already existing, but if new 
 buildings were erected, they should be designed to permit en- 
 largements on a w^ell organized scheme. Here, as elsewhere in 
 the system, the services of a competent engineer would be of 
 the first importance. In the whole design, erection and opera- 
 tion of such a system, the competent engineer would occupy an 
 indispensable place. Indeed the success of the whole undertak- 
 ing would depend largely on the w^ork of the engineer and the 
 ability shown in properly planning and organizing the propo- 
 sition. 
 
 It may be asked what incentive a banker would have in ad- 
 vancing large sums of money for such a purpose, when -with the 
 same capital he could establish a large plant under his sole con-
 
 212 THE PKICE OF INEFFICIENCY 
 
 trol and direction? Certainly the return would be greater for 
 the large plant to the banker than for the communal enterprise, 
 where the profits would be intended to go to the individual 
 manufacturers, since they would have the use of capital at reg- 
 ular rates of interest. It is not, however, invariably, the object 
 of the banker to secure the gi^eatest profit out of invested capital. 
 Indeed, it is a well known law of finance that the greater the 
 profit, the greater the risk, while the lower the profit, the greater 
 the security. The banker, putting money into a communal en- 
 terprise, would, owing to the number of individuals, have much 
 greater security than by trusting all his eggs in the one basket 
 of the large plant, with its responsibilities of management. 
 While it is known that sooner or later 95% of all men in busi- 
 ness go into bankruptcy, it does not follow that 95% of com- 
 munal enterprises would fail, indeed there is no reason why any 
 should fail, for while the individual units might succumb from 
 time to time, all the manufacturers could not, in the nature of 
 things, fail simultaneously, so that the communal group, while 
 its units would change from time to time, would persist indefi- 
 nitely as a group. 
 
 The banker would thus be hazarding his capital not against 
 one business, but against many, and in numbers there is financial 
 security. The financing of such an enterprise need not require 
 any great body of active capital, that is, capital at hazard and 
 subject to loss. After the purchase of the land, if indeed it 
 were not donated by the city, it could be mortgaged for enough 
 to supply funds for the buildings, and they in turn mortgaged 
 for enough to get money for equipment. The equipment, be- 
 ing placed with the manufacturers, who would in turn give mort- 
 gages, the whole enterprise could probably be organized on an 
 equity of one-fourth, that is three-quarters of the money would 
 be borrowed, only one-fourth being subject to loss. The estab- 
 lishment by a city of such an enterprise would not be a very 
 serious drain on its finances, and the credit of the city would 
 ensure its success. 
 
 It is a plan which would be particularly suitable for a small 
 city, where the cost of power is usually high to the individual, 
 and supplies and other costs, except rent, greater than in a 
 larger city. One active and public spirited citizen in each city 
 could stir the matter up and put it through, and a hundred 
 such organizations in a hundred of the cities of the country 
 could bring about enormous changes in the whole organization
 
 HOW TO SUPPLANT THE TRUSTS 213 
 
 of society, since the changes the communal system would bring 
 about would not only be economic but psychological. One of 
 the chief causes of industrial discontent now is that the large 
 plants have crushed the smaller ones and in doing so have taken 
 away from the workman liis last hope of rising in the world to 
 a position of economic independence. The best that he can ex- 
 pect to become is the foreman of a room or the superintendent 
 of a department. While under former conditions, the propor- 
 tion of men who could rise to the position of employers was 
 small, as indeed it must remain under any condition, the fact 
 that such opportunities existed, placed upon the workman him- 
 self the burden of proving that he was competent. Now, how- 
 ever, with such opportunities closed, even the most incompetent 
 can claim that but for existing conditions, he might rise and no 
 one can gainsay his assertion. The burden of pro-vang his own 
 competency has thus been lifted off the workman's shoulders, 
 and his discontent increases, while the industrial combinations 
 are charged with the failure of each and every one of their 
 employees to reach a commanding position. The number of 
 those whose rise is checked by the trust is necessarily small but 
 the yeast is taken out of the industrial loaf, and a sodden and 
 discontented mass remains. 
 
 In any state of society, the interest of the public is the supe- 
 rior interest. The fact that trusts have managed to drive out 
 the smaller manufacturer does not prove their superiority as an 
 industrial expedient; that is, that they can serve the public 
 best. When they are under proper control, they may supply a 
 given product at a lower selling price to the consumer than can 
 the small manufacturer, but the selling price is not the only 
 index of the cost to society of an article. Every article has a 
 natural or normal cost.' Time and labor are consumed to pro- 
 duce it, which' should be properly measured by the selling price 
 to the actual consumer, but when this selling price is too low, 
 the' cost of the article is made up at the other end of the line 
 in the blighting effect on the lives of the workers. This affects 
 society as a^whole so that ultimately the entire body of pur- 
 chasers pays the full ultimate cost of every article, no matter 
 how low its immediate cost may be placed to the consumer, by 
 the oppression of workmen and sha\dng of prices. "When part 
 of the cost comes out of the lives of the workmen, their purchas- 
 ing power 5.is reduced accordingly for other articles. When part 
 of the na'tural cost comes 6ut of the manufacturer's pocket
 
 214 THE PRICE OF INEFFICIENCY 
 
 through the exigencies of competition, he finally goes broke and 
 thro^vs a number of workmen out of employment, the natural 
 cost being made up in the waste inflicted on them. The proper 
 method of reducing the selling cost is by efficient methods of 
 manufacture and improved machinery, and not by crushing 
 out any class of society. 
 
 The small manufacturer is an economic necessity. A system 
 which removes such a class from the social organization is at 
 fault; it is a stairway from which the intermediate steps have 
 been removed, a stairway upon which progress is possible only 
 for giants. 
 
 The restoration of the small manufacturer must be accom- 
 plished. It is a duty which society owes to itself to free itself 
 from the fetich that competition is the cure for every ill, and to 
 see to it that the small manufacturer is again given his deserved 
 opportunity. Society is paying the price in high costs of living 
 for permitting the small manufacturer to be crushed, and self- 
 preservation demands his reinstatement in the social scheme. 
 
 The system of communal manufacturing here outlined should 
 gradually prove itself an effective means whereby society will 
 again utilize the force which should be the greatest of all indus- 
 trial forces, the initiative of the newly risen manufacturer, an 
 initiative which is now crushed by aggregations of capital, which 
 smother competition on one hand and oppress the consumer on 
 the other.
 
 CHAPTER XV 
 BUSINESS IS BUSINESS 
 
 What "Business is business" really means — A grueling contest — Business in 
 politics — Its twin evil of politics in business — Blackmailing laws and 
 exploitation of business men — Results of unbridled competition — 
 — Genesis of the trusts — Destructive effects of the "show-me" spirit — 
 Characteristics of the American business man — Capital and the 
 patentee — Business men and the banks — Why 05% of business men ulti- 
 mately fail — How our 23,000 banks strangle business — Menace of our 
 antiquated banking methods — The over-lordship of the capitalist — Re- 
 markable advantages of Cerman banking system — Wild-cat promoting 
 in the United States — Dangerous powers of the post office — What the 
 post office can do to your mail — Spectacular arrests — Political motive 
 back of police raids — Formation of public opinion — Editors with axes 
 to grind — How Edison in Germany turned a newspaper grindstone — 
 What Edison learned abroad — German architecture — Consumption of 
 alcohol — What a German thinks water is for — Eight suffragettes at a 
 soda fountain — Effective method of German government in dealing with 
 newspaper correspondents — How Edison's eyes were opened in German 
 cities — 36 lessons that he learned in Germany. 
 
 American business men, while energetic and resourceful, are 
 suspicious, largely unscrupulous and given to the use of ques- 
 tionable methods, too readily excused by the phrase, ''business 
 is business." The "business" that is ''business" is usually 
 some kind of knavery or double dealing that "gets by" be- 
 cause "nothing succeeds like success." 
 
 There is prevalent much of the spirit which is reflected by the 
 slogan "do other people before they do you," and this with 
 graft, "rake-offs" and the "show-me" spirit and cut throat 
 competition, makes business life a grueling contest, which in 
 the final sum total, amounts to everybody sacrificing everything 
 that a few may succeed. 
 
 The evil of politics in business is only the other side of the 
 mask of business in politics. The municipal plums tempt the 
 business man, and in his greed he does not scruple to take any 
 and every advantage and exert every expedient and bribe to 
 gain the prize. The politician, when the business man has over- 
 reached himself, in turn takes advantage, and by exposing and 
 
 215
 
 216 THE PRICE OF INEFFICIENCY 
 
 harassing him, turns the business man's shortcomings to his 
 own political profit. 
 
 This process is worked out in numberless ways, and obtains 
 from one end of the scale to the other. The policeman accepts 
 a bribe and allows the saloon keeper to keep open during for- 
 bidden hours. The law was passed for the purpose of enabling 
 the policeman, and those "higher up," to take advantage of the 
 saloon keeper's greed. If the saloon keeper was honest and 
 shut up and refused to give the bribe, if he controlled his greed, 
 both he and the policeman would be out of pocket; but black- 
 mailing laws would not exist, and in all probability a fair clos- 
 ing law would be worked out, in keeping with the real public 
 sentiment of the community. It is very easy to get, such black- 
 mailing law^s passed in American legislatures, on account of the 
 professional reformer. The moral intimidation that he exer- 
 cises, a strange contrast to the ulterior aims of the boss, fits like 
 a hand in a glove to the latter 's purpose, and they produce the 
 whitened sepulcher of American laws, the reformer polish- 
 ing the exterior and the boss's evil designs well concealed 
 within. 
 
 At the other extreme, presidents make political capital out of 
 large combinations of capital, which would not have come into 
 existence if earlier presidents had executed the laws. The 
 usual course of legislation is, when an abuse arises, to pass a 
 drastic law, which settles the matter for the time being. Vio- 
 lators are blackmailed, either directly or indirectly through 
 campaign contributions, and everything is under/ cover, until 
 finally the stench becomes so great that public opinion demands 
 action. The politicians then loosen the full fury of the law 
 on the heads of the violators, gaining great political capital 
 thereby, until the sympathy of the public is aroused, and a re- 
 action comes, in which the final condition is very similar to that 
 existing before the whole farce began. 
 
 This alternate blackmailing and exploitation of business men 
 by politicians and the bribery in one form or another of politi- 
 cians by business men, causes continual turmoil, which hampers 
 development and never promises to end, beginning in a new 
 quarter w^hen it dies down in an old one. 
 
 Competition in America is a cut-throat thing which ruins 
 business men by hundreds of thousands, to the ultimate disad- 
 vantage of the consumer. "While competition is held up as a 
 panacea for trusts, it is in reality the cause of trusts. Business
 
 BUSINESS IS BUSINESS 217 
 
 men in seeking to escape destruction from unbridled competi- 
 tion, as well as to procure greater gains, were drawn into com- 
 binations which in turn crushed the more independent business 
 men or forced them to join the combinations, sacrificing their 
 OAvn business identity. Had competition been properly regu- 
 lated and unfair methods prevented by law, trusts could not 
 have arisen. In Germany, for example, a competitor is not al- 
 lowed to cut prices simply for the sake of killing a rival. No 
 such industrial wars are allowed, as the public realizes that this 
 is the seed of monopoly. Consequently the trusts, as we know 
 them, do not sprout so readily, and all the turmoil and the 
 shouting are nipped in the bud. The fetich of free competition 
 has cost the American public dearly, for free competition in- 
 cludes unfair competition, and leads directly to monopoly. 
 
 One of the means whereby unfair competition is prevented in 
 Germany is the law against false representation. 
 
 Consular-General A. W. Thackara, at Berlin, states in the 
 U. S. Consular Reports: 
 
 "The laws of Germany are very strict regarding false repre- 
 sentations in advertising, such as putting extravagant values on 
 goods that are undoubtedly misrepresented. Article 4 of the 
 law which applies to such cases is as follows : 
 
 " 'Whoever, with intent to call forth the appearance of an 
 especially advantageous offer, shall in public announcements or 
 communications intended for a larger circle of persons, as 
 touching business relations, especially as touching the character, 
 origin, manner of production, or the fixing of the price of goods, 
 the possession of marks of distinction, the motive or purpose of 
 sale or the abundance of supplies, shall kno'Rdngly make false 
 representations tending to mislead, is liable to imprisonment up 
 to one year and to a money penalty up to five thousand marks 
 or to one of these punishments.' 
 
 "When a person is found guilty, a fine up to 5,000 marks 
 ($1,190) is imposed for the first offense; for the second offense, 
 a fine up to 5,000 marks or imprisonment up to one year; and 
 the third offense, invariably, the guilty party is sent to prison 
 for a term not exceeding one year. 
 
 "In addition, a person convicted of false advertisement is 
 obliged to insert an advertisement in a certain number of news- 
 papers stating that he has been convicted of unfair competition. 
 Usually he is required by the Judge to insert the advertisement 
 in at least twenty-five papers, and sometimes in as many as a
 
 218 THE PRICE OF INEFFICIENCY 
 
 hundred. The Judge usually dictates the text of the advertise- 
 ment and specifies the papers in which it shall be inserted." 
 
 The extent to which false representation goes in the United 
 States is shown by the prosecution of the government officials 
 during the fiscal year 1911, in which 522 individuals were in- 
 dicted on charges of using the mail in furtherance of schemes 
 to defraud. During the same period, 196 persons were tried, 
 of which 184 w^ere convicted, 12 acquitted and 177 awaiting 
 trial, while 72 are awaiting Grand Jury action, and 28 were 
 arrested but not indicted. The number who got away and are 
 being traced is 46. 
 
 The schemes in which there were convictions generally fell 
 under the following groups: 
 
 Promoting and sale of worthless mining or other stocks. 
 
 Inducing betting on fake horse-races and athletic contests. 
 
 Fake land schemes. 
 
 Commission merchant swindles. 
 
 Selling worthless goods through misrepresentations. 
 
 Obtaining commissions on fraudulent orders. 
 
 Work-at-home schemes. 
 
 Failure to furnish goods schemes. 
 
 Fake correspondence schools. 
 
 Sale of cheap books and divining rods for locating minerals. 
 
 Phoney guarantees of stocks and bonds. 
 
 Forged bills of lading in cotton deals. 
 
 Brokerage swindles. 
 
 Obtaining money by impersonating others. 
 
 Selling state rights and establishing fictitious agencies. 
 
 Selling unfair gambling devices. 
 
 "No fund" check schemes. 
 
 Matrimonial schemes. 
 
 Selling canceled postage stamps and Mexican money. 
 
 Turf tipster schemes. 
 
 Selling cigar outfits. 
 
 Defrauding employers by means of forged leases and keeping 
 money received from cash customers. 
 
 Defrauding insurance companies for alleged injuries. 
 
 Obtaining expense money on promises to sell stock. 
 
 Requesting fees for fake positions. 
 
 Selling the rights to a patent many times over in the same 
 state. 
 
 Securing advance payments on goods not delivered.
 
 BUSINESS IS BUSINESS 219 
 
 Obtaining payments from relatives of deceased persons for 
 goods supposed to have been ordered before death. 
 
 Obtaining money from alleged heirs to estates. 
 
 Obtaining money to assist in securing fake inheritances. 
 
 Sales of fake receipts. 
 
 Green goods swindles. 
 
 Obtaining subscriptions for charitable iustitiitions. 
 
 Fake employment bureaus. 
 
 Selling interest in non-existing moving picture theaters. 
 
 Selling diplomas and requiring little or no study before grant- 
 ing them. 
 
 Offering to instruct persons in the science of mind concentra- 
 tion. 
 
 Fake trance mediums. 
 
 Forged cheeks and blackmail schemes. 
 
 The cost in time and money to the government in the investi- 
 gation and prosecution of these cases has been so great and the 
 corresponding loss to other important features of the postal 
 service demanding attention is so apparent that Chief Inspector 
 Sharp recommends that the Department of Justice take over the 
 investigation of "get-rich-quick" cases. 
 
 The attitude of mutual distrust and suspicion which the em- 
 ployer and employee exhibit, is also seen in the relations of busi- 
 ness men to each other and between business men and the pub- 
 lic. 
 
 The American even takes a gi'eat pride in his suspicious dis- 
 position, which is glorified in the expression, "I'm from Miss- 
 ouri, you must show me," a phrase which sprang instantly into 
 wide currency after having been used by a western lawj'er who 
 was prosecuting a trust in an eastern court. The vast popu- 
 larity of the expression, which is excessively vulgar and com- 
 monplace in itself, reflects a characteristic feeling of Americans. 
 In many respects, the American is gullible, and consequently a 
 great number of fakes of various kinds are perpetrated. Hav- 
 ing been repeatedly "stung," he is constantly on the lookout 
 for further trouble. To announce that he must be shown is 
 therefore done with a certain pride, a warning that he is not 
 to be stung again. But with the usual extravagance of the 
 Americans, the "show-me" spirit is overdone, and it becomes a 
 destructive cynicism. 
 
 The American business man is not to-day a constructive 
 pioneer. He waits until he sees a thing fully demonstrated
 
 220 THE PRICE OF INEFFICIENCY 
 
 with other people's money before he is willing to invest. He is 
 always looking for a sure thing and wants 51% of it. If a new 
 proposition comes along in the shape of drawings, by which it 
 should be readily understood and passed upon by his engineers, 
 he waits to see the thing in concrete shape first. The American 
 inventor thus has a hard row to hoe, and finds capital an almost 
 impossible thing to obtain, while business men are much more 
 interested in seeing how they can infringe the patent than in 
 acquiring a legitimate interest in it. They always desire ex- 
 clusive control, not only of the invention, but everything else 
 the inventor may invent in the future, for which their most fre- 
 quently offered terms are a small salaiy per week until the in- 
 ventor is fired. If a valuable invention comes along that 
 threatens a standard article, it is most likely to be acquired and 
 bottled up, serving no useful purpose whatever but to prevent 
 the manufacturer's antiquated article from being driven off the 
 market. 
 
 Capital goes slowly and grudgingly into new ventures, and 
 the result is that a multitude of new things which prove so prof- 
 itable abroad, do not come into existence at all in America, and 
 foreign improvements are adopted only after they have been 
 used for years. 
 
 Yet the moment a good thing is developed by someone else 
 there is a rush to grab it, and all kinds of imitations appear on 
 the market and the business is apt to be ruined for everyone. 
 Too often, however, when exclusive control is obtained of an 
 article, the greed of the proprietors exhibits itself in the form 
 of charging extortionate prices, when with better business men 
 in control, the article would have a vastly larger sale at a fair 
 price. The tendency to "charge all the traffic will bear" is 
 thus, in every line of business, a disastrous characteristic. The 
 lack of initiative in new propositions, while at the same time 
 enormous sums are spent in advertising trade marks, holds de- 
 velopment back. The creation of a trade mark is a strange 
 process in America. The press and dead walls are suddenly 
 flooded with some combination of letters supposed to be a word, 
 almost always idiotic in the extreme, though sometimes stupid, 
 infantile or in bad taste, and this monstrous thing is jammed up 
 in eveiy conceivable space until the backers of the idea either 
 go broke or make a fortune by the sale of the hideously named 
 article. Thus is the English language enriched from day to 
 day.
 
 BUSINESS IS BUSINESS 221 
 
 The attitude of banks towards new ventures and toward their 
 regular customers is in America to-day totally out of line with 
 the proper functions of banking. 
 
 Mr. Joel Shoemaker in "The Brutality of Business" in the 
 Trend for October, 1911, says: 
 
 "Ninety-five per cent of the business men in the United 
 States become financial failures while living, or die in debt. 
 The chief asset left to the wives and children is some form of 
 life insurance, the policy not becoming a part of the estate. 
 Such statements come from experts in their field of research, 
 and may be considered as about correct. For when we go into 
 the details of commercial life, and read the daily tragedies writ- 
 ten on the faces of the oppressed, the only wonder is that the 
 ninety and nine human sheep go over the precipice to death, 
 and leave one able to stand alone and look down upon the 
 wrecks. 
 
 "The banking system is the foundation of what we designate 
 as our business plan of action. It covers the city and country 
 and marks the pathway to financial success or commercial de- 
 struction. As we have always been taught to judge a tree by 
 its fruits, and the returns from our banks show almost com- 
 plete failure, the natural conclusion must be that the system is 
 responsible for financial distress, commercial loss and general 
 devastation of the country, periods of poverty, and money 
 scarcity in the history of the past have established precedents 
 for indicting the banking system as one of the worst enemies 
 to individual and community success, known to the civilized 
 world. 
 
 "We have in this country about 23,000 banks, representing 
 a combined capitalization of $1,900,000,000 shown on paper 
 through the articles of incorporation, or on the stock books of 
 the various banks. The deposits of these financial institutions 
 aggregate approximately seventeen thousand millions, or more 
 than eight times the capital stock of the corporations holding 
 the funds in trust for the depositors. The figures are borrowed 
 from one of the best informed financiers of Boston, and must 
 be taken seriously. They give an insight into the secret 
 chambers of modem finance and show why so many men fail in 
 business. 
 
 "There are 7,200 national banks, having the monopoly of 
 issuing notes, to be covered by government bonds. Those banks 
 have outstanding at present something like $700,000,000 of that
 
 222 THE PRICE OF INEFFICIENCY 
 
 bond secured circulating paper. Such notes are comparatively 
 safe, although as one banker says, 'It is probably the most un- 
 scientific and inelastic note circulation in existence." But the 
 depositors have no guarantee of even safe handling of their 
 funds, unless they live in the advanced localities where wise 
 men of the day have enacted laws requiring guarantee of de- 
 posits. 
 
 "Money is not personal property to be hidden away in deposit 
 boxes, buried in tin cans, or locked in legally authorized bank 
 safes. It is the property of the people, a circulating medium, 
 and its use is an absolute necessity in the daily business trans- 
 actions of the masses. Every dollar in excess of legal reserve 
 fund designated for banks, diverted from its legitimate channels 
 of trade, and stopped on its mission of a debt payer, assists in 
 clogging the wheels of commerce and producing panics. The 
 reserve being 25% of deposits, every sum stored away above that 
 amount, constitutes a robbery of the people, in taking from the 
 masses the use of that which belongs to them and which brings 
 food and clothing. 
 
 ' ' The common people must stand for the losses in the business 
 world. The farmers suffer because of not getting reasonable 
 prices for their products; the w^orkingman loses in decreased 
 wages, being out of employment, and risking the possibility of 
 ever getting pay for his work, and the whole consuming public 
 — the masses — foot the bills. As a grocer said, when asked to 
 sign a protest against exorbitant freight rates: 'It is nothing to 
 the merchant what the freight bills amount to, the consumers 
 must pay the bills.' So, in this fluctuating market the con- 
 sumers are the ultimate losers in all that goes to make up for 
 deficiencies caused by poor management, ignorant manipulation 
 and false standards of financial tokens, in the business world. 
 
 "AVhy are such conditions permitted to continue in the com- 
 mercial centers of our country? The answer is plain enough. 
 It is in the interests of capitalism. A stable financial system 
 would prevent extortion in interests, commission on loans, sell- 
 ing of human slaves into capitalistic bondage, and establish a 
 sound money basis that would insure peace and prosperity. 
 Such conditions are desired neither by the politicians or capital- 
 ists. Both live on strife and uncertainties. Trouble among 
 the people is capital for such leaders, because it brings money,- 
 votes and power to their hands and forces the masses to humili- 
 ating acts of beggary."
 
 BUSINESS IS BUSINESS 223 
 
 Banking and currency form a subject, not only of the great- 
 est importance to the public, but a subject which is difficult to 
 understand, and which should be settled by disinterested ex- 
 perts. Yet lawmakers see possibilities of political capital in 
 it, and attack it with ignorant recklessness, while as for the 
 experts, most of those who really understand finance are more 
 or less tinged with capitalism and hence cannot view the subject 
 in the proper light. 
 
 Our present system is particularly well adapted to promote 
 the interests of trusts as opposed to the small business 
 man. 
 
 The thing works itself out, briefly, in the following manner: 
 Large corporations are formed and those backing them are 
 ready at all times through the instrumentality of the Stock Ex- 
 change to repurchase the stock at varying prices. In fact, by 
 buying and selling among themselves, they keep up, often, when 
 necessary, a fictitious appearance of interest. Thus any owner 
 of the stock may sell at any time, there always being a market. 
 
 Money which is deposited in banks is loaned by the bankers 
 who accept stocks of such companies as collateral security. Thus 
 the owner of such stock may either sell it or borrow money on 
 it at any time, since the banks, knowing that there is always a 
 market for it, may, if the loan is not paid at maturity, get their 
 money back by the sale of the collateral. Thus the stocks and 
 bonds of trusts are convertible into money at short notice. 
 
 Organizers of trusts often borrow money on their own hold- 
 ings to form other trusts, and thus one by one the industries of 
 the country fall under the control of financial interests, the 
 latter using the very bank balance that the manufacturer has 
 in the bank to form the corporation which destroys his business. 
 
 There are two kinds of loans based on corporation securities: 
 call loans, which the banks may require payment on at any 
 moment, and time loans running from thirty days to a year or 
 more. The rate of interest on call loans is readjusted every 
 day and most of them are loans which banks have made to 
 brokers. 
 
 At seasons of the year when money is plentiful, the business 
 man deposits it in his bank, which redeposits it in a New York 
 bank, where instead of remaining idle, it can be loaned out from 
 day to day at a certain rate of interest, but at the same time it 
 is always available.
 
 224 THE PRICE OF INEFFICIENCY 
 
 The speculator, in the office of the broker, sees from the rate 
 of interest that money is plentiful. He therefore puts up, say 
 $10,000 cash of his own, orders his broker to buy $100,000 worth 
 of stock in trust, and the stock is handed to the bank in ex- 
 change for a loan, the speculator thus raising the necessary 
 money to pay for the $100,000 stock he has bought, $10,000 be- 
 ing his own money and $90,000 borrowed, eventually from the 
 deposits of banks all over the country. 
 
 Thus whenever money is plentiful, the speculators buying for 
 a rise, make the stock scarcer, as all want to do the same thing 
 and only a certain amount of the stock is in the market at any 
 one time. With numerous buyers, the stock goes up, and a 
 boom in the Stock Exchange is on, which presently attracts the 
 attention of the public. They buy at high prices. They with- 
 draw money from deposit for this purpose. The speculators 
 sell at a profit. He acquires his profit, he has removed that 
 much money from the pockets of others without giving any- 
 thing in exchange except the risk he went to. The money that 
 might still be free to go into business has passed, partly to the 
 profit of the speculator and partly to the organizer of the trust 
 in exchange for its stock. No actual values have been lost, but 
 a transfer of ownership has taken place from the small man to 
 the greater. The readiness of the public to buy the stocks of 
 the trusts has created a terrible business depression. The wealth 
 of the country has passed to the control of a few persons, 
 through their ability to operate the device known as the stock 
 exchange and through our currency and banking system, since 
 the stocks of the trusts formed have been sold at prices far in 
 excess of their actual value by means of this device. The pub- 
 lic have bought stock worth much less than they paid for 
 it, and have impoverished the sources of supply of money so 
 that the small business man has been snuffed out, in two ways: 
 One simply by the weight of capital that the trusts have thrown 
 in the scale against his business and the other through the bank- 
 ing system. 
 
 Thus if a business man has in hand orders for $10,000 worth 
 of goods and has only $5,000 in hand with which to buy the 
 goods before he can resell them, he cannot transact that piece 
 of business unless he can raise $5,000. With proper banking 
 facilities, he should be able to go to a bank, borrow the money 
 at a fair rate of interest on his notes secured by his $5,000 assets 
 in hand, which need not pass to the possession of the bank. He
 
 BUSINESS IS BUSINESS 225 
 
 could thus complete his transaction, pay off his obligations and 
 prosper. But can a merchant go to a bank and arrange to get 
 credit for ten times as much as the capital he has in hand, a3 
 the speculator can at the stock exchange. Certainly not. He 
 is indeed fortunate if he can get even a small part of the money 
 after signing a bond that would make Shylock blush. The bank 
 will only loan him on the best security, which is proper, but it 
 will often refuse him on any security. The cash is in New York 
 w^orking for the speculators, and the business man's business 
 languishes while the speculator prospers. 
 
 Then hard times come. The speculator has killed the goose 
 that lays the golden eggs. The business man, being unable to 
 carry on his transactions for want of available capital, cannot 
 make reasonable profits. The trusts crush him out and absorb 
 the money he might do business with. ]\Ioney becomes scarce 
 and the result is immediately felt in New York. Banks do not 
 have so much money. They are not anxious to take call loans. 
 The call loan rate rises. Speculators cannot make so much 
 money. They watch the call loan rate as the weather man does 
 the barometer. It shows coming storms. 
 
 Then the speculators begin to sell. The men behind the 
 trusts buy only what they must to keep the market from break- 
 ing and a panic ensuing. Prices decline a few points a day, but 
 this liberates money, and the business man finds his bank more 
 reasonable, but if speculation has been too great and too many 
 people have borrowed money to buy stocks, the banks 
 refuse further call loans, from want of cash themselves or for the 
 ulterior purpose of furthering a reduction in the price of stocks, 
 so that they can repurchase at lower level; and a great rush for 
 cash ensues. There is too much credit outstanding, too many 
 have borrowed money. One may ask how could it be borrowed 
 if it did not exist. Very simply, because a ten dollar bill can 
 be borrowed and loaned through a chain of a dozen friends in 
 a day, but if in such a chain of friends, the bill comes back to 
 the first man and he holds it and demands repayment from the 
 man he has loaned it to, and no other ten dollars can be found, 
 or nobody else willing to lend any of them a ten spot, all the 
 friends will be in a hole. And if the bills are $100,000 instead 
 of $10, the matter is not so simple, although the principle is the 
 same. 
 
 In conditions of a panic, when the speculators have borrowed 
 too much all around, and everybody is withdrawing money from
 
 226 THE PRICE OF INEFFICIENCY 
 
 banks for fear they wall fail, from being unable to get back 
 their money from speculators, all the money is practically locked 
 up at once, and perfectly sound concerns all over the country 
 whose assets are greater than their liabilities go into bankruptcy 
 because they cannot collect what is owing them to pay what is 
 demanded, even though the latter be less. Thus out of the ac- 
 tivities of the speculators playing with the public's money real 
 panics grow which ruin thousands of banks and business firms 
 and throw millions out of employment. Their purchasing power 
 lost, the business of remaining firms is greatly reduced and 
 many of them fail. A period of stagnation results in which a 
 large part of the workers are out of work and only such ex- 
 penses are incurred as are absolutely necessary to keep body 
 and soul together. In time the surplus on hand is devoured or 
 worn out, and new purchasing power appears, which reemploys 
 men, restores their purchasing value. This serves to reemploy 
 other men and gradually the row of blocks which fell over in 
 the panic, draws itself into an erect position again, ready to 
 tempt the speculator to further excesses. 
 
 What the country needs is a banking system which will place 
 the business man in the position of advantage, rather than the 
 speculator. The Stock Exchange, which is the greatest menace 
 to American liberty that has ever appeared, should be curtailed 
 or entirely abolished. Very effective measures can be easily 
 taken. For example, a bank is not allowed to lend more than 
 10% of its capital to any individual. Laws should be passed 
 forbidding it to lend more than 10% of its capital on stocks and 
 bonds as collateral. The convertibility of one share of stock 
 into another is one of the cornerstones of Wall Street. That 
 is you buy 100 shares of stock. Certificate No. 1561 is the same 
 as No. 52. Either may be delivered to you. Or you may bor- 
 row Certificate No. 52, sell it, and at a lower price repurchase, 
 say No. 1561, or any other number, and use it to repay the loan 
 of stock, thus making a profit. This is the process known as 
 short selling. It is one of the pillars of Wall Street, and the 
 instrumentality whereby markets are broken. While it works 
 automatically to prevent over-inflation, it is a highly dangerous 
 remedy. It would probably be impossible to destroy the con- 
 vertibility of stocks, but real estate is not convertible, and true 
 speculation cannot exist without such convertibility, and does 
 not exist without it. Speculation in commodities depends on 
 convertibility also, as one bushel of wheat is the same as another.
 
 BUSINESS IS BUSINESS 227 
 
 Short selling, however, while at times a serious evil, is a power- 
 ful brake against a runaway market, and prevents the reckless 
 inflation of stocks to enormously high levels and the consequent 
 panics such as occurred in the times of the South Sea bubble. 
 Short selling is merely a weapon, a dangerous one, but capable 
 of being used to the advantage of the public as well as against 
 the public. The amateur speculator, the lamb who so quickly 
 loses his little fortune in speculation, seldom tackles the 
 short side, almost always buying in hope of a rise, a process 
 really more dangerous than that of selling in hope of a de- 
 cline. 
 
 The great t^\-in evils of Wall Street, however, are its use of 
 bank funds for speculation and the system of ' ' wash sales. ' ' 
 
 A "wash sale" occure when a speculator not necessarily a 
 broker, but usually a promoter or in some way interested in a 
 company 's stock, gives one broker an order to buy the stock and 
 another broker an order to sell an equal amount of the same 
 stock at a price which he fixes. The brokers meet on the stock 
 exchange and carry the deal through without either knowing who 
 the other is acting for, as they very jealously guard their cus- 
 tomers' secrets. 
 
 Several such "wash sales" during a day give an appearance 
 of activity to the market, at prices either rising or falling as suits 
 the purpose of the speculator working the wires. The ability 
 thus to fix prices fictitiously is used to fleece the public, and is in 
 reality nothing short of a crime. Stock Exchange brokers are 
 in effect only a private club of auctioneers, bidding and knocking 
 dowTi stocks to each other for their clients, the speculators. 
 There is a law in New York against conducting a fake auction 
 and small fry auctioneers are going to jail all the time for vio- 
 lating it. A large part of the transactions of the stock exchange 
 are fake sales made to influence the public. If brokers were 
 licensed as other auctioneers are, and were compelled on closing 
 a sale to disclose their principals' names, such fake transactions 
 as wash sales would be automatically disclosed and would have 
 to cease. A very stringent rule requires the brokers to know 
 who their customers are. A supplementary statute forbidding 
 speculators to carry accounts in false names with brokers would 
 effect the complete remedying of this gigantic swindle. 
 
 The stock exchange, in fact, aspires to a monopoly of gambling 
 and swindling in the United States. The community of interest 
 which it represents has promoted legislation against lotteries,
 
 228 THE PRICE OP INEFFICIENCY 
 
 race tracks and swindling by mail and is now the only form of 
 open gambling not forbidden by law. 
 
 The slight skim of legitimate transactions is the cloak of re- 
 spectability which the organization throws over its huge body of 
 gambling and most terrific outcries are made when it is accused 
 of gambling. Nevertheless its major purpose is gambling and 
 the crafty system which has been built up for exploiting the pub- 
 lic with the public's own money obtained through banks can 
 never be thoroughly broken up until the stock exchange is abol- 
 ished, and prosperity can never return while the leeches of 
 finance continue to drain the life blood of commerce into their 
 own creations. 
 
 Wall Street is a great Frankenstein of finance, a monster whose 
 claws are deep into the body of public enterprise, too deep it 
 would seem to be torn out, but torn out they must if worse 
 conditions are not to come. The world existed for centuries 
 without Wall Street and only in the last generation has this 
 great parasite grown to such threatening proportions. Wall 
 Street is unnecessary, criminal and insatiable. It should be de- 
 stroyed at whatever cost, if not for our own benefit, then for that 
 of future generations. 
 
 While a very few simple laws with teeth in them would suffice 
 to destroy the financial incubus, if enforced by resolute execu- 
 tives, the moneyed powers have so thoroughly identified them- 
 selves with the government by secret avenues and political obli- 
 gations that they are in fact the government's government. 
 
 The units of the public are widely separated, an army of Lilli- 
 putians, and each one is in awe of the financial giant. A para- 
 lyzing sympathetic influence is thus wielded and each Lilliputian 
 fears to bestir himself for fear of attracting unfavorable notice 
 and all remain in slavery. 
 
 Such spectacles come to be witnessed as a president of the 
 United States sanctioning monopolistic combinations and 
 another doing all in his power to block the progress of a congres- 
 sional investigating committee. 
 
 Such presidents are mere lackeys of Wall Street and their 
 names deserve to be smudged out of history with the thumb of 
 public disapproval. 
 
 Althougli servitor after servitor of the financial powers, dis- 
 credited in the public offices to which they w^ere elected under 
 false pretenses, has gone down in defeat and disgrace, their suc- 
 cessors again and again prove of the same stripe. The quickly
 
 BUSINESS IS BUSINESS 229 
 
 shifting sands of politics breeds traitors to the public interest who 
 though having constituted the government one day are seen to 
 emerge the next day as presidents of banks and financial com- 
 panies and salaried employees of the trusts, while a new gang in- 
 fests the seats of power. The government is thus intangible and 
 irresponsible. The crimes of one set of officials cannot be visited 
 either effectively on their heads or on the heads of their successors. 
 There is nothing definite that can be called the government. It 
 is only a badly worldng impersonal mechanism, now in control 
 of one set of engineers and now another, all interested in run- 
 ning it for theii- own ends and not for the benefit of the pub- 
 lic. 
 
 The evils that confront us are deeply rooted in an ineffective 
 system, and to effect a cure measures must be taken which will go 
 to the bottom of things. It is not time to temporize or delay; 
 it is a fight that must be fought, and the sooner we know who is 
 to survive, the financial powers or the public, the better off we will 
 be. 
 
 The first thing the business man must have is at least an equal 
 chance with the speculators. He should, in fact, have the ad- 
 vantage on his side that the speculator now enjoys, instead of the 
 advantage being on the speculator's side. One of the prime 
 requisites is to give his assets convertibility, and convertibility 
 must be given to his obligations. That is to say, we 
 should institute a new system of banking whereby the business 
 man's notes which he gives to the bank, could be redis- 
 counted by the bank, that is, passed on to some other 
 bank in some other part of the country where money was 
 more plentiful. If the notes of business men were in denomi- 
 nations of $100, $500, $1,000 and $10,000, and on being given 
 were stamped by the bank in a manner which pledged not only 
 the resources of that bank to their repayment, as well as the 
 resources of the merchant himself, and in addition the resources 
 of every other bank in the United States, such notes would 
 become convertible and could be sent to financial centers and be- 
 come objects of barter and sale in the place of the present cor- 
 poration securities. Under present circumstances the govern- 
 ment only issues currency to the value of its bullion and national 
 banks are allowed to issue currency to the value of certain gov- 
 ernment bonds which they hold. Thus the amount of money in 
 existence is rigidly fixed and cannot be increased or decreased 
 in volume without the greatest difficulty. In times of a panic
 
 230 THE PRICE OF INEFFICIENCY 
 
 this bit of money, which is vastly less in value than the posses- 
 sions of the citizens of the country, but the only medium of ex- 
 change, is instantly locked up by everybody who has any of it, 
 and ruin results for all, through inability to get hold of a few 
 tokens of value, although all have no end of valuables worth 
 money, if thej' could be exchanged for the tokens, the supply of 
 which, through a faulty legislative and banking system, is re- 
 duced to a minimum which cannot be readily expanded. Bank- 
 ers, too, are loath to expand their currency issues, as when money 
 is free again, they are paying 3% and 4% for the use of gov- 
 ernment bonds to make currency which they can only lend at 2% 
 on call loans in New York. 
 
 What the country needs is convertibility of business men's 
 obligations or notes, and an asset currency, that is to say, that 
 when a man goes to the bank and pledges his house on his note 
 and the bank pledges its resources and all the banks of the 
 country through some central institution, pledge their resources 
 for its repayment, the banks should be permitted to issue actual 
 currency in the form of bank notes against say 25% of that 
 value. An unlimited supply of the tokens of value would thus 
 be available whenever wanted, and no panic could ever arise 
 because panics are caused by the locking up of tokens of money, 
 and Math such tokens producible readily, there would be no 
 lack of them to meet every obligation that might fall due. 
 
 The foundation of our money now is the credit of the United 
 States Government. An asset currency would give it as a 
 foundation the credit of all the owners of property in the coun- 
 try, which is better than the government, because the govern- 
 ment is only the ability to tax that property, and the property 
 itself is certainly more valuable than the ability to tax it. 
 
 A currency based on lumps of stored gold is a currency based 
 on the value of that metal. A currency based on stored iron 
 Avould be just as solid as a gold currency. Gold is simply used 
 because its supply is somewhat uniform and its rarity makes 
 a small amount of it valuable. A bank can store gold, but to 
 store an equal value of iron would require larger quarters. 
 Gold in itself, aside from its value as money, is intrinsically less 
 valuable than iron. A currency founded on iron, or on lead, or 
 on silver, if universally followed would be as useful as a gold cur- 
 renc3^ Any currency, however, founded on one material, like 
 gold, is full of hardships, because when gold is discovered in great 
 quantities, as in the last ten years, its value decreases, because it
 
 BUSINESS IS BUSINESS 231 
 
 is more plentiful. Imagine gold suddenly becoming as plentiful 
 as iron, and the dream of the miner is to discover the mother 
 source of gold, in which case it would be as plentiful. It would 
 lose its value immediately. Dollars would not buy what pen- 
 nies buy now. To-day prices are seemingly iiigher than for- 
 merly, partially due to more gold being found. Winle the dol- 
 lar remains a dollar, the man with twenty pounds of iron, for 
 instance, will not sell it for less than a dollar, whereas formerly 
 he would sell twenty-five pounds of iron for a dollar 
 in gold. 
 
 The only scientific currency is one based not on one metal or 
 material alone, but one based on all materials and metals. To 
 give business men's notes convertibility, and instead of circu- 
 lating them and selling them like so many bushels of wheat, to 
 have a portion of them, or all, deposited at one point and used as 
 the basis for currency, would be to make the standard of value, 
 on which that currency was based, a standard including all 
 forms of value. This would be a true currency, and being 
 backed by the business assets of all the banks with the credit of 
 the government behind that, would make an ideal currency, one 
 perfectly elastic and suited to the needs of business. Panics 
 could not then arise. A governmental tax on money in circula- 
 tion higher than the tax on property would drive currency out 
 of existence when it was not needed, without preventing its com- 
 ing into existence again when more currency was needed to 
 conduct the actual transactions of business life. It would be a 
 system far more stable than the present one, in which every bit 
 of commercial paper is always under suspicion, is not converti- 
 ble and represents a source of friction between the bank and 
 the borrower at all times with possibilities of a panic at any mo- 
 ment. There is no confidence in our present system by those 
 who know anything about it, because they know that it is based 
 on the inflated values of stock exchange securities. Thus if 
 all depositors want their money at once they cannot get it. They 
 should be able to but they cannot because the credit of the 
 country depends on the ability and willingness of the managere 
 of corporations to repurchase stocks in their companies. Their 
 inability or disinclination to do this will at any time plunge the 
 country' into a panic. 
 
 All our business men are thus at the mercy of Wall Street, 
 but with an asset currency which could be readily ex- 
 panded, everybody could have his money at any time he wanted
 
 232 THE PRICE OP INEFFICIENCY 
 
 it. The fact that it was taxed by the government in the form 
 of taxation on the notes on which it rested, would cause the 
 makers of the notes to redeem them as rapidly as consistent 
 with conditions and not to issue them unless required to do so, 
 and this would automatically draw the actual currency back 
 into the banks and to physical destruction as bits of paper, keep- 
 ing values at all times out of the form of currency and in the 
 form of property and other assets, except such proportion as 
 might actually be required for daily transactions. 
 
 With the possibility of the banks loaning to local depositors, 
 the small business man would have at his command the same 
 degree of credit which is now monopolized by the trusts. Busi- 
 ness would revive amazingly and every bit of capital in the 
 country could be used in developments, instead of being tied up 
 as it largely is at present. 
 
 The organization of banks, however, is carried out in a thor- 
 oughgoing spirit of monopoly which will not be upset without 
 great difficulty. They are a kind of impudent band of leeches 
 grown fat by manipulation and skimming of interest and other 
 devices and they are an incubus on the prosperity of the country 
 instead of the help that they should be. 
 
 Particularly dangerous are the consolidated banks which ac- 
 quire great power through tlieir enormous holdings. Their dis- 
 integration or unscrambling is a duty which the public owes to 
 itself to perform without delay. 
 
 As an example of how great a profit the banks may make out 
 of a very small item of their operation, may be cited the collec- 
 tion charge on checks passing from city to city. It was brought 
 out in the 1912 hearings of the Congressional Committee investi- 
 gating the money trust that the banks of New York derive a rev- 
 enue of some $50,000,000 a year out of the charges made for col- 
 lecting checks, practically the sum they pay out in dividends. 
 Although in any individual case the amount of the collection is 
 small, j^et in the aggregate the absorption of this much value 
 from the channels of commerce is a serious and indefensible 
 drain. 
 
 Banks are given to small pluckings not much noticed by those 
 plucked, but profitable in the aggregate. The charging of $2.00 
 a month for "carrying the account" of small depositors, one 
 who maintains a balance of less than $200, is one of the profit- 
 able little side grafts of banking. In fact the whole subject 
 of banking is one of many ramifications far beyond the scope of
 
 BUSINESS IS BUSINESS 233 
 
 this volume. The sudden rise to positions of financial impor- 
 tance of many young men in the banking world is an evidence 
 of the fine art of blackmail which thrives nowhere as in the 
 world of finance, where slight deviations from the legal path 
 on the part of high officials provide the foothold. "With such 
 men in such positions of power it is little to be wondered at that 
 the banking system is one in which the position of the public 
 is not dissimilar to that of a picked chicken. 
 
 The ability of the public which it should have, to use its money 
 in any direction, free of the domination of Wall Street, would 
 enable the establishment in this country of banks similar to those 
 in Germany for promotion purposes. 
 
 The conduct of the treasury department of the United States 
 has been contrary to the interest of the public and in favor of 
 Wall Street. The national banking system is partially to blame 
 for this, as banlvs are the avenues w^hereby the government reaches 
 the public ; and banks are not under governmental control. 
 
 While the citizen can lend the government money, by the pur- 
 chase of government bonds, the government cannot directly lend 
 the citizen money, and there are times when governmental lending 
 is essential to the welfare of the country. In the panic of 1907 
 in order to prevent a great collapse of banks in New York, the 
 government deposited many millions of its reserves in New York 
 banks. This was unknown to the public, but the money, through 
 the avenues of great financial houses, was placed at the disposal 
 of the members of the stock exchange at an enormously usurious 
 rate and the day was saved and a noted financier was given credit 
 for saving the country. Under proper banking laws in Avhich the 
 government might lend direct to borrowers instead of having to 
 put its money into banks and having no control of the use to 
 which it is then put, save the privilege of withdrawing it, such 
 an outrageous farce would be impossible and the financiers instead 
 of wearing halos of glory and reaping huge harvests of interest, 
 would be left to the last, in case of such necessity, like rats 
 on a sinking ship, and the real business men of the country 
 saved first. 
 
 The banker and broker are essentially middlemen of monetary 
 dealings, but they are in such a position of advantage that they 
 reap a large percent of the fruit of the labors of others without 
 sowing themselves. They are monopolists of the avenues of dis- 
 tribution of money and credit and the government must place its 
 money with them if the public is to gain any advantage. It has
 
 234 THE PRICE OF INEFFICIENCY 
 
 no other means of placing its surplus funds at the disposition of 
 the public. 
 
 The government could retain its funds in its vaults and that 
 has recently been done to a greater extent than usual, but such a 
 course while it hurts the broker, hurts the business man more. 
 It is as if the cook refused to deliver the dinner to the waiter 
 to prevent him from stealing the tid-bits en route to the patron. 
 Although the waiter broker is inconvenienced, the patron suffers 
 a greater degree of starvation. 
 
 The accumulation thus of a great "dead mass of currency" in 
 the government's vaults is nothing short of an economic crime. 
 
 A surprising negligence, too, is shown by the government in 
 its relations with the banks which are depositors of the govern- 
 ment funds, for such institutions do not have to pay the govern- 
 ment interest, nor do they have to maintain a high reserve. 
 
 "What actually happens when a bank receives a great govern- 
 ment deposit is that the loan clerk of the bank telephones the 
 loan clerk of a brokerage house that they have such a sum to lend, 
 at a rate of interest which is fixed by the bank. The transaction 
 is immediately concluded for the next day, such transaction being 
 regularly carried out on one business day for deliveries the next 
 day ; the broker gets his check and the bank accepts as collateral 
 the stocks of the big corporation or trusts as security. Some- 
 times the bank and the broker deal through an intermediary 
 known as a loan broker, who does the telephoning, or who chases 
 from broker's office to broker's office making the arrangements 
 for a very small rake-off or the loaning may be done on the floor 
 of the stock exchange itself, especially if it is late in the day. 
 Such loans are usually for $100,000 each, though often for 
 $250,000, and are made with a degree of convenience and celerity 
 unmatched in ordinary business life. The government's money, 
 as well as any other money on deposit in banks, thus slides as if 
 on greased rails directly into Wall Street where the speculators 
 who congregate to buy and sell in the brokers' offices may with 
 the utmost facility borrow it again from the brokers to buy stocks 
 with, in the corporations that crush the business man, who if he 
 desires to borrow $5,000 or $10,000 even, must go to great trouble 
 if not humiliation to get it, tliougli he liimself may borrow it from 
 a bi'oker's office to buy stocks with, with the greatest of ease. 
 
 Tlie government has lost, it is estimated by officials, 
 $100,000,000 in the last 25 years in interest on money placed in 
 depository banks, if interest be only figured at 2%, a low but fair
 
 BUSINESS IS BUSINESS 235 
 
 rate since the funds are withdrawable on demand. The banks, 
 however, have under very rare circumstances ever loaned any 
 money at less than 2%, and as they loan a large part of their 
 money on time loans at higher rates and occasionally on demand 
 or call loans, on which the money must be returned on one day's 
 notice, at from 3 to 4% ordinarily and from that up to 20, 40, 
 60 and 75% and higher occasionally, with very little risk of the 
 government withdrawing its funds suddenly, the banks have thus 
 profited not less than $250,000,000 during the 25 years, or some 
 ten millions a year on this one small, unnoticed item, a sura 
 which would match the philanthropies of even a Carnegie, a 
 Rockefeller or a JMorgan if devoted to the public's good instead 
 of to the banks. 
 
 Thomas A. Edison in an interview, after his recent return 
 from Europe, in the Neiu York Times, copj^righted b}' the Pub- 
 lisher's Press, and written by Edward ]\Iarshall, points out the 
 advantage of this feature of German banking. 
 
 "One great advantage which the manufacturers of Germany 
 have over us and over every other countrv^ is to be found in 
 her great promoting banks. In the United States, a man who 
 wishes to get something new on the market, must get hold, in 
 one way or another, of a promoter of his enterprise, and our 
 promoters are notoriously irresponsible. There, inventions are 
 brought out by promoting banks. 
 
 "For instance, the Deutscher Bank, which in the first place 
 is one of the largest banks in the world, has a corps of engineers 
 and auditors ready to investigate every phase of any proposed 
 invention. If the invention which is taken to them proves, after 
 the most careful investigation, likely to be useful and profitable, 
 the money is forthcoming. The financial and technical investi- 
 gation is rigid to the last degree, but if the idea stands the test, 
 the capital is ready. 
 
 "The same plan can be followed by a manufacturer who 
 wishes to extend his business. If he can prove that he can do so 
 profitably, he can get the money for the purpose from the bank 
 at a reasonable interest and very promptly. It saves time and 
 keeps him from the clutch of that particular breed of sharks, 
 who in this country would be likely to make a prey of him. 
 
 "The bank, then, will watch the progress of the invention or 
 of the manufactory, will place its stock on the Exchange, and, 
 when it reaches a certain point of prosperity, will take its money 
 back, charging only a fair profit for its use, and leaving the in-
 
 236 THE PRICE OF INEFFICIENCY 
 
 ventor or manufacturer with his invention or his factory ready- 
 to go ahead with it alone. 
 
 "This is an enormous encouragement to the inventive faculty 
 of Germany, and I predict that it will soon put the German 
 nation in advance of us in the origination and development of 
 new mechanical ideas." 
 
 Promotion in America, as Mr. Edison indicates, is certainly 
 carried on in an irresponsible manner. 
 
 The promoter usually demands an extortionate proportion of 
 the capital secured, and in many instances the promoter exists 
 solely by getting advances in fees from those looking for capital, 
 without ever securing the desired money for the enterprise. 
 Many companies are floated by promoters, knowing that they 
 can never succeed and the promoter thus fleeces the public and 
 the original owner of the project. 
 
 The government has lately found a means of stripping the 
 notoriously fraudulent promoters of their powers, and in many 
 cases of their liberties, through, a law which prescribes penalties 
 for using the mails to defraud, but the post office department, to 
 effect these results has been given dangerous powers, which are 
 subject to abuse, and in addition to having the potentiality of 
 evils worse than are cured, places those prosecuted in the light 
 of martyrs. Animus is ascribed, and the use of the mail has 
 been declared by the highest courts a privilege withdrawable 
 by the department and not a right of the citizen. A means of 
 reaching fakirs without such tremendous executive power should 
 be found, as the agents of the department carry out the law in 
 the most sensational manner possible, bringing it further into 
 disrespect by sudden raids upon suspected parties. 
 
 A spectacular arrest, with struggling prisoners, a gaping 
 crowd, axes, patrol wagons, broken doors and furniture and 
 other stagey accompaniments, is one of the specialties of Amer- 
 ican administration of justice. In Russia, an officer who can- 
 not effect an arrest without a disturbance is discharged. It is 
 there usually only necessary to let the accused know that he is 
 wanted. He has respect enough for the law to come when he 
 is invited. In America the culprit has so little respect for the 
 law as to often engage in a physical struggle with the arresting 
 officer. This is a picture of legal inefficiency and explains much 
 of America's lawlessness. Having no respect, and properly so, 
 for most of the legislatures, the culprit feels that his liberties 
 are being invaded, which they often are, as is proved by the
 
 BUSINESS IS BUSINESS 237 
 
 highly numerous collection of laws decided unconstitutional, 
 after citizens have been arrested and tried under them. 
 
 The underlying cause of spectacular arrests is political. 
 Flourishes of this kind are supposed to impress the public with 
 the thoroughness of the party in power. The administration of 
 the police is a matter of politics and the head of the department, 
 who very seldom has any previous experience in police work, 
 feels the necessity of showing the public what it is getting for 
 the money it is paying. Usually the gamblei*s, pool room men 
 and resort keepers are made the victims, since no one will feel 
 disposed to defend them. The police thus gain a little cheap 
 advertising, and a certain amount of public opinion is formed, 
 at least as affects those who do not see further than the ends of 
 their noses. As there are many of this sort, whatever is sen- 
 sational ard spectacular, has a certain effect. 
 
 Ulterior motives so often are back of enforcements of the 
 law as to render it still less worthy of respect. Certain busy- 
 bodies make their living by getting up societies to enforce cer- 
 tain laws. Rich people contribute to such societies and in order 
 to secure further contributions, the professional salaried re- 
 former must show a certain degree of activity. Rescue homes 
 for women, societies for preventing various cruelties and vices 
 flourish, wdth consequent frequent miscarriages of justice, and 
 the postal laws are often found a very useful medium for the 
 reformer's activity. A characteristic incident of this kind was 
 seen in the case of Oscar Krueger, for whom President Taft 
 issued a pardon on Jan. 19, 1912, as told in the news dispatches 
 as follows: 
 
 ' ' President Taft granted to-night a pardon to Oscar Krueger, 
 a New York plasterer, who has been serving a term of eighteen 
 months in the Atlanta Penitentiary on the charge of sending 
 improper matter through the mails. The pardon followed rec- 
 ommendation of District Attorney Wise of New York of the De- 
 partment of Justice, on the theorj' that Krueger was \\Tougfully 
 convicted last February, as investigation having convinced the 
 Department of Justice that the accused did not write the offen- 
 sive letters. 
 
 "The Department's version of the case is that a respectable 
 young woman in New York advertised for a place and received 
 a letter in response, which was considered improper. Anthony 
 Comstock got possession of the letter and inserted a decoy ad- 
 vertisement, arranging for an appointment. The young woman
 
 238 THE PRICE OF INEFFICIENCY 
 
 went to the place, found no one there, but looking around saw 
 a man in the neighborhood, and asked him whether his name 
 was 'Ed,' the password for the meeting. 
 
 "Krueger was the man whom she met, but denied that his 
 name was 'Ed,' explaining afterward that he said it was for 
 a joke. He denied that he had written any letter. The Depart- 
 ment of Justice compared Krueger's handwriting with that of 
 the letter and was satisfied that he had not written the missive. ' ' 
 
 The formation of "public opinion" is achieved in many- 
 devious ways in the United States, and very largely by those 
 who have some sort of ax to grind, generally unknown to the 
 public. 
 
 Some newspapers grind their axes not only in the editorial 
 columns, but most dangerously in the news columns and chiefly 
 among the expedients are the concocted interview and the mis- 
 leading headline. A striking yet artistic example of newspaper 
 ax grinding was accomplished by the New York World, when 
 Thomas A. Edison was made to do duty for its German 
 ax, and a sorry figure the venerable inventor was made to 
 show. 
 
 On leaving Hamburg, where he had received many courtesies, 
 an interview was cabled to the World by its own special corres- 
 pondent traveling with Edison, which included the following: 
 
 "There is something wrong with the German aesthetic lobe. 
 They feed their brains too much on beer, and the result is beer 
 architecture. The only dignified buildings I have seen are 
 copies of the Greek and Roman. In architecture as in all else, 
 the Germans lack proper initiative; they are good adapters, 
 that's all. 
 
 "Another thing that handicaps German progress is their over- 
 economy. They grudge spending money, and if a new machine 
 comes out, the German will not buy it until he has used up the 
 old one. 
 
 "Where American intelligence comes in, is in the willingness 
 to spend money when necessary. There is no short-sighted 
 penny-saving among our business men. 
 
 "One hears great talk about the high standard of business in 
 Germany, yet at luncheon the other day with German financiers 
 they admitted there is no comparison between English business 
 standards and their own. 
 
 "The Englishman's is the highest standard of integrity in 
 the world," Edison is made to say that he was told. "Our Ger-
 
 BUSINESS IS BUSINESS 239 
 
 man aristocrats are entering largely into business now to get 
 rich quick, and tliey don't care how it is done. Their methods 
 have affected business ideals generally. 
 
 "It is my own opinion that the English are the highest type 
 physically and mentally over here," the great inventor went on. 
 "I do not believe in the talked-of industrial world-dominance 
 of Germany. 
 
 "We have nothing to learn from her and she has much to 
 learn from us." 
 
 This was published in the morning edition of Sept. 29, 1911, 
 and in the afternoon, the Neiv York Glohc answered it as follows, 
 not being, as it would appear from the opening sentence, too 
 well convinced of its contemporary's accuracy. 
 
 "Did Mr. Edison really say, as the ^Vorld makes him say, 
 that "in architecture, as in all else, the Germans lack proper 
 initiative; they are good adapters, that's all?" Somehow this 
 does not sound like an exact likeness of the Germans. Translate 
 Mr. Edison's general statement into particular statements, and 
 the result looks rather queer. 
 
 "In music the Germans lack proper initiative. They are 
 merely good adapters. Richard Wagner was a good adapter; 
 that's all. The same thing is true of Richard Strauss. Tu 
 statecraft and war, Germans lack proper initiative. Examples, 
 Bismarck and Moltke. In philosophy they are nothing but 
 good adapters. See the works of Immanuel Kant, passim. 
 Goethe lacked proper initiative in dramatic poetry, lyric poetry, 
 natural science, criticism and Ichensiveisheit. 
 
 "Even if we confine ourselves to our outi day and to the sin- 
 gle province of poetry, IMr. Edison's assertion is just as wide 
 of the mark. We suppose most Germans would say their most 
 eminent living poets were Richard Dehmel and Stefan George. 
 It is conceivable that INIr. Edison may hear nothing but the 
 echoes which undoubtedly make up part of George's talent, that 
 he may be deaf to the equally undoubted originality, but can 
 IVlr. p]dison or anyone else seriously maintain that Dehmel is a 
 mere adapter without initiative?" 
 
 On October 1st, the World published a letter from its special 
 correspondent traveling with Edison, dated Dresden, Sept. 20th, 
 in which Edison is reported as having said: 
 
 "Germany leads with its industrial chemistry; tliere's no 
 people that can touch it in that important branch. The German 
 brain seems perfectly fitted for success in such experiments;
 
 240 THE PRICE OF INEFFICIENCY 
 
 they leave all other countries behind in their magnificent initia- 
 tive in that line." 
 
 While Edison found that the esthetic lobe of the German 
 brain is too much fed on beer, with the terrible result of beer 
 architecture, it is evident that they have magnificent initiative 
 in chemistry, whether on account of beer or in spite of it does 
 not appear. 
 
 The question of beer drinking, for which Germany is so fa- 
 mous, needs a little consideration on its own account. Beer 
 drinking in Germany is carried on in such an open manner that 
 it forces itself upon the attention of visitors. But the quantity 
 of beer consumed in the United States in 1910 was 1,851 million 
 gallons against 1,704 million gallons in Germany, making 20.09 
 gallons per capita in the United States against 26.47 per capita 
 in Germany. In the United States, however, there are nine dry 
 states, 882 dry counties and 6,994 dry towns against none in 
 Germany, and as it is more convenient to drink distilled spirits 
 in the so-called dry states, counties and towns, the remaining 
 states of the Union easily lead in beer consumption per capita 
 as compared with Germany. American beer, in addition, con- 
 tains twice as much alcohol as German beer as consumed in Ger- 
 many, therefore the American consumption of alcohol in beer 
 is twice as much as German consumption. The German can 
 thus drink two glasses of beer to the American's one with no 
 more inconvenience. He thus seems to be a large beer drinker 
 but in reality consumes only half as much of the intoxicating 
 principle as the American does. 
 
 The distilled spirits consumption of the United States in 1910 
 was 134.6 million gallons, which is more than ten millions more 
 than the German consumption. Further, American whiskey 
 is 50% stronger than German whiskey, as newly arriving Ger- 
 mans quickly find out, to the amusement of bar tenders and 
 waiters who first serve them, and to their own eye opening 
 surprise. 
 
 And a large proportion of American whiskey is not the real 
 thing, but a doctored composition of nobody knows what. If 
 German architecture is beer architecture, American architecture 
 should be rot gut architecture. 
 
 On Mr. Edison's arrival in New York, having shed his special 
 correspondent with other impedimenta of his journey, he denied 
 to the assembled reporters many of the statements that had been 
 attributed to him. The World of October 8th, however, in order
 
 BUSINESS IS BUSINESS 241 
 
 to save its face, headed its interviews: "Edison Stands by What 
 He Said About Germans." In the article the following ap- 
 peared : 
 
 "I gave the reporter who was \nth mo all the time, a lot of 
 'dope.' " 
 
 And the World in passing the "dope" along, stated further: 
 
 "I had no means of knowing what the report did say until 
 I saw this interview. I said that what the Germans themselves 
 acknowledged was that the integrity of their commercial classes 
 was not as high as that of the English. 
 
 "They admitted it themselves. 
 
 "I had to take their own word for it. I had no means of 
 knowing the standard of integrity of the German business 
 classes. I will say personally that I believe the Germans entirely 
 honest, the most honest in the w^orld. I have had them in my 
 laboratories all my life. 
 
 "I think Germany is the most advanced nation in Europe. 
 She has a million factories and is building more and more all 
 the time, and growing more and more prosperous. 
 
 "When a German sells $100 worth of goods, they weigh 
 about 30 pounds; when a Frenchman sells $100 worth, they 
 ■U'Cigli 400 pounds, and when an Englishman sells $100 worth 
 of goods, they weigh half a ton. ' ' 
 
 As to the integrity of German business men and the state- 
 ments made to him by the Germans themselves; although not so 
 reputed in America, the German is in reality a very polite per- 
 son. In Spain, the visitor has but to praise an object to be in- 
 formed that it is his, while in Germany if the visitor deprecates 
 any condition of his owna country, the German will declare 
 something similar in Germany to be much worse, whether it is 
 or not. The statement that German business honor is inferior 
 to English was probably made to comfort Edison on American 
 trusts. 
 
 In an interview in the New York Times of October 22, 1911, 
 Mr. Edison, speaking of the German appetite says: 
 
 "At German restaurants, the general tendency toward over- 
 eating is a painful sight to witness, really. Americans, as a 
 rule, I have observed, eat about twdce as much as they need; 
 Germans eat twice as much as Americans, which is four times as 
 much as they need. The prosperity of the German nation is in 
 spite of the most extraordinary overeating. And a people who 
 take into their systems every day, 75% more food than is neces-
 
 242 THE PRICE OF INEFFICIENCY 
 
 saiy to give the proper strength and weight must necessarily 
 suffer from it. 
 
 "I made an interesting but necessarily crude calculation in 
 Germany. If Germany ate as much as she ought to, she could 
 export food products instead of importing them at the rate of 
 $2,000,000,000 annually. She pays, therefore, far more than 
 $2,000,000,000 every year for the food which she consumes in 
 plain excess of her needs. 
 
 ' ' This, in an era of prosperity along most scientific and com- 
 mercial lines, is a startling contradiction, an astonishing instance 
 of extravagance and foolishness in the midst of careful econo- 
 mies and common sense. 
 
 "She eats far too much, but she drinks with a more reckless 
 absurdity than she eats. Her tremendous consumption of beer, 
 wine and high alcoholic ciders, is appalling. It hurts her peo- 
 ple mentally and physically and hurts the nation economically." 
 
 As to the overeating, it is quite possible that Germans in pub- 
 lic eat more than in private, as is the case in America. In New 
 York, for example, there are numerous popular restaurants 
 which are patronized by a transient class. New Yorkers enter- 
 tain their visitors, and on particular occasions go out to eat at 
 these restaurants. Although they are always filled, the patron- 
 age is not the same crowd night after night. One such meal will 
 upset the average digestion for a week. With the Germans the 
 same is true, so that the eating that is seen in public restaurants 
 is by no means an index of the actual amount of food consumed 
 under normal circumstances. However, it is customary with all 
 Germans to eat five times a day. Even manufacturing concerns 
 during working hours are compelled by law to allow employees 
 three periods for eating which are in addition to their meals be- 
 fore and after working hours. 
 
 As the consumption in America of malt and alcoholic liquors 
 is greater than in Germany, and as the alcoholic liquors are 50% 
 stronger in America, Mr. Edison's admonitions are more appli- 
 cable to America than to Germany. Only in wine consumption, 
 mostly taken with meals, is Germany in excess of America. The 
 German cannot understand a three dollar dinner with water on 
 the side. "Water, although filtered in Germany and without 
 river ice, is believed to be best suited for ablutions. 
 
 In America drinking is not carried on as frankly as in Ger- 
 many and is only witnessed by those who go into the bars to 
 drink themselves, although the parade of "souses" is more
 
 BUSINESS IS BUSINESS 243 
 
 noticeable in America. If eight persons enter a bar room, as a 
 rule good fellowship requires a treat all around, which means 
 sixty-four glasses all told. Even if the later ones are only beer 
 in whiskey or champagne glasses, for the benefit of those who 
 can no longer lift the heavier receptacles and the saloon owner, 
 there is still an appreciable quantity consumed. In America 
 when the suffragettes come fully into their own, and eight visit 
 a soda fountain, 6-1 ice cream sodas will then be customarily 
 served. 
 
 It would appear that the World succeeded more or less in em- 
 broiling Germany and Edison, and placing the latter in a veiy 
 ridiculous light. The criticisms which he was credited with did 
 not injure Germany, as they were obviously ill-considered, but 
 the interviews had the effect of making Edison belittle himself. 
 
 Emperor William makes every effort to receive distinguished 
 American visitors, and the failure of Edison, the most noted 
 inventor in the world, to meet him, may have been due to these 
 newspaper inventions. 
 
 Mr. Edison may have came in contact with a phase of the 
 system described by Mr. Charles Edward Russell in "German- 
 izing the World," in the Cosmoyolitan Magazine of January, 
 1906: 
 
 "A hostile or critical correspondent finds in Germany the 
 avenues of information gently but firmly closed against him. 
 So quietly is this done that the unfortunate man is slow to be- 
 lieve that he is really boycotted, and so effectively that he can 
 get nothing he wants." 
 
 In order to show the real opinion which Mr. Edison formed 
 on his visit, and to do justice to him, the following extracts from 
 interviews with him in the New York Times of October 22nd, 
 and 29th, 1911, from which we quote by courtesy of the Publish- 
 ers' Press, show at once the facts in the case and the many 
 things that Americans can learn abroad. 
 
 "The Germans have wheat which seems to show a higher 
 gluten content than our own. W^e should investigate this care- 
 fully. 
 
 "I looked into the matter superficially and discovered that 
 the fact is well known to the experts, so well known that some 
 of the best American hotels import this wheat to have their flour 
 ground from it. Its gluten content is so high that people fed 
 on bread made from this wheat do not actually need meats. 
 
 ' ' They are careful in investigation of such matters over there,
 
 244 . THE PRICE OF INEFFICIENCY 
 
 and we should be, but are not. We don't seem to care. It is a 
 pity. 
 
 "They gave us 'balanced bread' as a matter of course. We 
 do not get it in America. Over here we take out all the phos- 
 phorus and certain other things and unbalance it. 
 
 "It no longer remains a really normal human food, and I be- 
 lieve that to be a bad thing for us. Beri-beri, one of the disease 
 curses of the Asias, is due to eating rice unbalanced by the re- 
 moval of the shell. 
 
 "This has been sufficiently demonstrated, so that the demon- 
 stration of the cause has pointed out the way to certain cure. To 
 sufferers from beri-beri, they give water in which rice shells have 
 been boiled, which amounts to an essence of the very properties 
 the lack of which has caused the trouble. The sufferers get well. 
 
 "There is undoubtedly good cause for a great national food 
 reform movement in the United States. I don't know that the 
 white bread that we eat is bad for us, but I do not believe that 
 it is as good for us as German bread is for the Germans. I be- 
 lieve that nature knows better than we do, and that we'd better 
 not unbalance our grain rations. 
 
 "I saw," says Mr. Edison, speaking of housing in Berlin, 
 ' ' what made me ashamed for my own United States, I am afraid. 
 The workingmen of New York City are not housed as are these 
 Berliners. What a contrast to the dreadful tenements which 
 disgrace and deface New York's crowded districts. 
 
 "The buildings which these workingmen went home to could 
 not properly be spoken of as 'tenements' — a term which in this 
 country has fallen into disrepute. They may better be referred 
 to as apartment houses, beautifully constructed, perfectly sup- 
 plied with air and light, safe against fire and made up of large 
 and conveniently arranged rooms. 
 
 ' ' Each story has its large iron balconies, and the balconies are 
 generally jammed with flowers. In this country, flowers or any- 
 thing else upon the balconies are violations of the law, for they 
 might obstruct their use as fire escapes. 
 
 "In the German city, not only are they not forbidden, but 
 are, I am informed, actually compulsory, because of the belief 
 that beauty helps to make life pleasant, and that the pleasant 
 life is likely to be the useful one. And the flowers upon them 
 do not peril human life by obstructing them when they are 
 needed for escapes from fire, for the very simple reason they are 
 not needed for escape from fire. These German buildings do
 
 BUSINESS IS BUSINESS 245 
 
 not burn. They are well built of good materials and really fire 
 proof. 
 
 "I did uol ijo inside to see the rixjins, but was informed that 
 the littlest apartment in tiiem has four rooms, and that most 
 of them are live room flats, and that they are provided very 
 adequately with all the eonveniencies of modern city life. It 
 was a beautiful sight to see, in Berlin, block after block of these 
 fine, model, workingmen's apartment houses. 
 
 "The rentals are extremely moderate, proportioned to the in- 
 comes of the men. 
 
 "They are doing great things in Berlin to make the people 
 happy — making an incredibly fine city of the German capital. 
 I went through many factories in Berlin, and its environs, and 
 after I had finished my long visit to one of them, I stood outside 
 to watch the workmen as they left it at the end of the working 
 day. I wanted to see how they looked and acted, and then, I 
 wanted to follow some of them and see how they were housed — 
 what sort of homes they had. 
 
 "The Germans are the world's most persistent people. When 
 they start a thing, they usually get it, and they have started 
 now to capture our mechanical prestige. It will take hard work 
 and intelligent work in the United States to prevent them from 
 outstripping us. 
 
 "I went into the packing rooms of several large German fac- 
 tories, and there found indications that their foreign trade is 
 larger than their domestic trade, which is enormous. They are 
 wonderfully energetic and intelligent. They organize with sin- 
 gular ability and extraordinary patience. They have started a 
 solemn, unsensational, but ruthless, and never slacking campaign 
 for the world's trade, fighting us where we oppose them, fighting 
 England where she has business which they covet, pushing 
 ahead everywhere. 
 
 "It behooves us to take thought of this, and watch them 
 closely. There is much which we might learn with profit in 
 their methods. 
 
 "I was informed in Germany that German capital has estab- 
 lished banks in all parts of the world for the purpose of assist- 
 ing German merchants resident abroad, so that she not only 
 exports goods, but makes the profit from their sale abroad and 
 furnishes the necessary banking facilities, also highly profitable, 
 through which the business is concluded. 
 
 "I became interested with another thing — I believe I see the
 
 246 THE PRICE OF INEFFICIENCY 
 
 true inwardness of the Emperor's naval policy. No one wants 
 war less than he, no one would do more to keep out of war. But 
 he considers a large navy a good investment. The German navy 
 is a commercial proposition. The money spent upon it is a mere 
 premium paid on the insurance which it offers to German capi- 
 tal invested in remote spots of the world ; it protects German 
 merchants wherever they may be, and assures them of what 
 T. R. is fond of calling a square deal." 
 
 Mr. Edison summarizes the difference which he observed be- 
 tween this country and Germany in the following list of items, 
 many of which are of the greatest importance. Interviews of 
 this kind are much more illuminating and useful than misrepre- 
 sentations hot off the cable. 
 
 "German industries are pushing ahead faster than ours, and 
 a new financial scheme threatens our prestige, even in the pro- 
 duction of new inventions. 
 
 "German factory construction, factory management and pro- 
 tection of workingmen is far in advance of ours. 
 
 ' ' European land is not nearly so good as ours, but the average 
 crop per acre on it is three times as large. 
 
 "Our people are wasteful and unscientific all along the line. 
 
 "We neglect our opportunities with startling carelessness. 
 
 "An enormous roadside crop of apples is grown in Germany on 
 land which would be wasted in this country. 
 
 "The immense advantage of intensive farming, not realized 
 in the United States. 
 
 "Our farmers diffuse their time and energy on crude cultiva- 
 tion of large areas. 
 
 "Good European building laws, absolutely enforced, are far 
 superior to ours. 
 
 "Fire horrors like those peculiar to America are impossible 
 in Germany. 
 
 "German building depreciation is only a small percentage of 
 ours. 
 
 "Germany is not behind us in general manufacturing and far 
 in advance in chemical industries. 
 
 "The Continental European farmer is infinitely more effective 
 than tlie American farmer, because he is more careful and less 
 wasteful. 
 
 "A great movement to increase rural efficiency is in progress 
 in Austria, and America needs something of the same sort. 
 
 "The German peasant understands many of the great requi-
 
 BUSINESS IS BUSINESS 247 
 
 sites of success far better than the American farmer does. 
 
 "From a soil so bad tliat we would scorn it, the foreign ngri- 
 culturist produces marvelous crops. 
 
 "Berlin is full of energy; Berliners even in their walking gait 
 show signs of their great progress. 
 
 "Berlin night life is as brisk as their day life; it is brisker, 
 even, than New York's. 
 
 "Night life is much maligned; it means progress and effic- 
 iency; and stupidity and night life do not go together. 
 
 "Too much sleep may be a national curse. 
 
 "One added hour of night life will do wonders with a nation. 
 
 "Berlin is truh^ wonderful and has a street liner than any in 
 this country. 
 
 "They are doing more in Germany to make the people happy 
 than we are in America. 
 
 "The homes of Berlin workingmen make one ashamed of tlie 
 United States; the dreadful tenements which disgi'ace and de- 
 face American cities, threatening health and happiness, are sup- 
 planted there by magnificent apartment houses. 
 
 "Law means law in Germany; in the United States it does 
 not; and this is particularly true of building laws to prevent 
 loss of life by fire. 
 
 "^Management of public officers is better in Germany than in 
 the United States, fewer laws and these more competent than 
 ours. 
 
 "Germany has taken her city governments out of politics. 
 
 "Graft as we know it here does not exist in Germany. 
 
 "In the chemical industries, Germany far surpasses us. 
 
 "Germany controls trusts admirably, but she encourages, not 
 discourages them. 
 
 "And Germany is very prosperous while we are gnimbling 
 at hard times. 
 
 "Emperor William not a war lord really, but a potentate of 
 commerce. 
 
 "He'll never go to war if he can help it; his army and na\'y 
 are business investments. 
 
 "William is a marvel among monarchs, a sporadic case of 
 great ability in an ocean of incompetence. 
 
 "We are careless, even in our wheat selection; Germany is 
 not. 
 
 "No similar journey in the United States could have been 
 made for the same money."
 
 CHAPTER XVI 
 STIMULATING PROGRESS 
 
 Foreign criticism as an unintended stimulus of progress — Germany's well 
 planned policy — Expansion of the German merchant marine — German- 
 izing the world — Self criticism one of the secrets of German success — 
 Absorbing the wealth of the world's knowledge — What England pays 
 for self satisfaction — Blunders of English statesmen in relation with 
 Germany — Origin of the phrase, "Made in Germany" — A blundering 
 naval demonstration — Futility of the new English patent law — Recent 
 German industrial colonies in England — The stimulus of criticism and 
 the dangers of flattery — Vast influence of the press — How directed to 
 useful purposes — Remarkable control of the press in Germany — How 
 all things work together for the benefit of German policy. 
 
 In the world rivalry of the great powers, the tremendous ad- 
 vances made in the last generation, particularly in Germany, 
 are disconcerting to other powers, and to some a source of the 
 greatest distrust and irritation. 
 
 Yet no little of the stimulus which Germany has received 
 has been unconsciously applied by envious rivals in the form of 
 criticisms intended to harass and destroy her commerce. 
 
 Internally the conscious criticism, that with which Germany 
 regards her own efforts, has been the infonning motive of her 
 well planned policy. 
 
 Of the workings of the German system, Mr. Charles Edward 
 Russell under "Germanizing the World," in the Cosmopolitan 
 of January, 1906, writes: 
 
 "In well considered, definitely planned, undeviating, relent- 
 less but peaceful aggression, the rest of the world seems asleep 
 in comparison with the German government. No man can men- 
 tion an instance in the last thirty-five years in which they have 
 been worsted. 
 
 "They are persistent, tireless, indefatigable, always at it, 
 pushing German goods here, German ships there and German in- 
 fluence everywhere. In politics and diplomacy, or in trade and 
 commerce, they work with the same inspiration to the same end. 
 We have seen them here at our doors steadily elbowing the Brit- 
 ish from the North Atlantic carrying trade, steam and sail. 
 
 248
 
 STBIULATING PROGRESS 249 
 
 Look over the lists any day and see the number of German 
 steamers that enter the port of New York now and think ba<-k 
 to the days when the German flag was a rare sight in our har- 
 bors. Is it not amazing? 
 
 "And what they have done in a small way here, they have 
 done in a great way around the globe. Look at the map of one 
 of their steamship lines. They send ships to every maritime 
 countr}'. They go into Southampton and take the eream of the 
 Eastern trade from under the very faces of the British. They 
 go into India and Australia and crowd the British out of their 
 o^\'n markets. England itself they flood with goods, they force 
 themselves into the English colonies; they have steamship lines 
 to Montreal and ^Melbourne, they dnve into Calcutta and Bom- 
 bay; they have huge settlements in South America, tliey get the 
 fat concessions in Turkey and Argentina. And at the head of 
 all this is the German government urging, encouraging, advis- 
 ing, pushing. Not many years ago we used to draw a greater 
 part of our immigration from Germany. Very few Germans im- 
 migrate now. They have too much to do at home. You can 
 hardly find a considerable German town that cannot show a 
 new factory or an old one enlarged. The prosperity of the 
 country seems boundless and has a novel kind of patriotic in- 
 spiration ; for it is not alone to make money but to spread Ger- 
 manism that the merchants strive and dare. Every enterpri.se 
 that carries German influence abroad can count upon the gov- 
 ernment's intelligent support. 
 
 "Trade may follow the flag or the flag may follow trade, I 
 do not know which ; but one thing is sure enough : German in- 
 fluence follows German commerce. The clever German govern- 
 ment sees to that. First comes a German steamship carrying 
 German goods, then a German branch sets up; then other Ger- 
 man houses come in, then there is a German consul in that part 
 and in ten years the place is saturated with Teutonism. It has 
 been so all about South America, the East, the South Seas and 
 elsewhere. It will be more and more so from this time on." 
 
 Such is the German policy. It is the policy which has made 
 Germany what it is to-day, envied by many short sighted na- 
 tions. The tremendous advantages which Germany possesses 
 over other nations is in almost all cases the reason why Ger- 
 many is attacked by other nations. Even for the only fairly 
 well informed observer, it is rather amazing to see part of the 
 daily press expressing their views, or rather making statements
 
 250 THE PEICE OF INEFFICIENCY 
 
 regarding Germany and everything pertaining to Germany, 
 which in nine cases out of ten are self-contradictory. Their 
 efforts no doubt succeed in forming a certain phase of public 
 opinion, especially as regards those unfamiliar with what is go- 
 ing on abroad, or those who flatly refuse to make themselves ac- 
 quainted with conditions. 
 
 Some papers imagine that they have an ax to grind, and they 
 proceed to do it at the expense of their readers, and to some 
 degree of the nations at large. AVould it not be a great benefit 
 to the public instead, to be kept informed of progress in other 
 countries, and have the fact kept in mind that there are things 
 which can be learned from other nations? 
 
 Germany openly and frankly acknowledges that she learns 
 many lessons from America. Exchange professors are one strik- 
 ing example. The Germans are proud of their methods. They 
 send their young men the world over to study foreign methods, 
 languages and customs. They then adopt such as are practical 
 and combine them with their own thorough practice and theories. 
 Is it any wonder that to-day they lead the world? 
 
 Germany, forty years ago, a poor second rate country, stands 
 now as an example for the world ; Japan, ten years ago likewise 
 poor and less than a second rate country, has achieved the most 
 remarkable historical progress of our generation. These star- 
 tling advances have been principally due to the ability to recog- 
 nize their own inferiority compared with other nations, and then 
 achieve the superior position. The costly price of inefficiency 
 which England paid and is paying and will pay for a long time 
 to come, is due to the self-satisfaction she exhibits, the belief 
 that she cannot learn from other nations, and this is the princi- 
 pal reason she is standing still if not retrograding. 
 
 In her relations to Germany, the statesmen of England are 
 continually making blunders. Among numerous examples, a 
 notable one is the phrase ' ' Made in Germany ' ' which has become 
 famous the world over. This phrase had its origin in an Eng- 
 lish regulation, compelling articles of German manufacture sold 
 in England to be so labeled. What was intended as a means 
 of discrimination, soon became a trade mark of great value, just 
 as the queues of the Chinese, a IManehu ordinance, became a 
 Chinese badge of honor, defeating the intentions of the discrim- 
 inators. 
 
 Ordinarily, the German is inclined to be easy going, to let 
 well enough alone, but he does not like to be rubbed too much
 
 STBIULATING PROGRESS 251 
 
 the wrong way. England some years ago made a great and 
 overawing naval demonstration in the North Sea, with the idea 
 of frightening the Germans. The result was that the German 
 government seized the opportunity to invite the puhlic to the 
 North Sea coast, providing excursion rates, and the impression 
 intended by England was duly registered, with the contrary re- 
 sult, however, that vast naval expenditures were authorized 
 shortly thereafter, the English thus playing directly into the 
 hands of the German administrators. King Edward thus proved 
 to be the greatest promoter the German navy ever had. 
 
 A recent example of the futile efforts of the English ministers 
 to curb German development is found in the new English patent 
 law, which compels patented articles to be manufactured in 
 England. It was argued that this would keep millions of 
 pounds in England, and it was aimed at the German manufac- 
 turer, and also against the United States. 
 
 The result has been disappointing, many patents lapsing, 
 other companies withdrawing, while in the case of the more im- 
 portant inventions, especially the German chemical patents, the 
 result has been the employment, not of additional English labor, 
 especially of the lower class, but the importation of trained 
 Gennan labor, since the English were not skilled and could not 
 readily be trained. Thus numerous German colonies have been 
 established in England and the patent laws have proven abor- 
 tive, while at the same time putting in England a large number 
 of men who have served in the German array, adding further 
 to the great English bugaboo of a German invasion, one of the 
 most curious examples of national hj'steria that has ever been 
 exhibited, and which has a fresh outbreak every time an imagi- 
 nary Zeppelin is sighted. 
 
 The idea of a German invasion of England would probably 
 never have occurred to a single German, not even the "terrible" 
 German waiters or the sellers of frankfurters in the London 
 streets, so feared as Gennan spies, had it not been suggested in 
 England, and the constant reiteration of the subject is the only 
 thing that might, at some future time, tempt GeiTuany to make 
 the absurd attempt. 
 
 The growth of German colonies in England as a result of the 
 patent law, has gone forward so quietly that the English min- 
 istry is not yet awake to it. What sort of an explosion will oc- 
 cur when this "peril" is fully recognized may readily be 
 imagined.
 
 252 THE PRICE OP INEFFICIENCY 
 
 English newspapers, realizing the blunders that have been 
 made, and impotent in the face of German progress, have 
 adopted a policy of continual attacks. Like the anti-German 
 press every^^^here, their efforts only redound to the injury of 
 those making them. The "knocker" generally hurts no one as 
 much as his own country. ' ' Every knock is a boost. ' ' 
 
 Flattery would be a far more dangerous weapon, for if it is 
 wished to destroy the ambition of a nation or of an individual, 
 flattery will nine times out of ten succeed, inducing the fatal 
 self-satisfaction of the belief that the ambition is already real- 
 ized, potentially if not actually. The benefit of national criti- 
 cism is too little understood. To criticise another country is to 
 put it on its guard, call forth a defense, or if none be possible, 
 the way is pointed out for an improvement which would not 
 otherwise have been seen. 
 
 The tremendous influence which is in the hands of the press 
 for the betterment or otherwise of a country is too little under- 
 stood by the general public. The assumed superiority of Amer- 
 ican inventors, with other causes, has resulted in placing Amer- 
 ica in a second rate position in invention, and her inventors are 
 in a most deplorable position. 
 
 The press of England and Germany are particularly flexible 
 instruments for the expression of inspired opinions, thus exert- 
 ing enormous influence. 
 
 Charles Edward Russell in the Cosmopolitan of January, 
 1906, on "Germanizing the World," says: 
 
 "Intelligent observers have often marveled at the way the 
 English press is controlled to further the ends of England 's in- 
 ternational interests no matter which party may be in power. 
 For example, the government having concluded that it is for the 
 best interests of England to frighten Germany by affecting a 
 partiality for France, the entire press, Liberal, Conservative, 
 Radical and Socialistic, breaks out into elaborate eulogies of 
 France and the French, those that on such an occasion as the 
 Dreyfus trial, for instance, had exhibited the most violent hatred 
 for anything French, being now the most elequent and fervent 
 in chanting praises. But the German government can beat such 
 an achievement and not half try. 
 
 "The British press, it must be admitted, is not skillful about 
 these things. Too often the praise sounds forced, the welcome 
 has a false ring. The Gennan government can influence the 
 German press to say things in a way that carries conviction.
 
 STIMULATING PROGRESS 253 
 
 "Moreover, the British government can, as a rule, influence 
 only the ne\vsi)apers in Great Britain; the Gennan plan is to 
 influence the papers of the world so far as German affairs and 
 interests are concerned. This seems at first thought merely a 
 grotesque fancy, in reality it is not fantastic nor even difficult. 
 The center of German news is Berlin. The news that is sent out 
 from Berlin flows through certain well-detined and recognized 
 channels. Five or six news bureaus supply the bulk of the cor- 
 respondence for all the newspapers of the world. 
 
 "The news despatch, wisely conducted, is therefore the strong- 
 est weapon of the modern government, and in its use of this 
 weapon, the German government has shown all others to be 
 children. The English have the mere rudiments of the art.; the 
 Fi-ench and we know naught of the matter. It is not merely in 
 international politics that the German government finds in its 
 press its greatest instrument; in the limitless field of German 
 influence and German commerce the press plays a mighty part 
 for Germany. 
 
 "In Berlin is the best, the most complete, and the best man- 
 aged press reading and clipping bureau in the world, run by 
 and for the German government. There is not anywhere around 
 the world a conspicuous publication affecting in any way the 
 interests of Germany, that does not find its way to this bureau. 
 The gi'eat newspapers of all languages are watched incessantly 
 and every correspondent in Berlin is rated according to his dispo- 
 sition towards the German plan. A simple but tremendous force 
 is brought to bear to discourage hostility and what the govern- 
 ment regards as misrepresentation. 
 
 "The value to his newspaper of any correspondent lies in his 
 facile access to the sources of news. A hostile or critical corre- 
 spondent finds the avenues of information gently but firmly 
 closed against him. So quietly is this done that the unfortunate 
 man is slow to believe that he is really boycotted, and so ef- 
 fectively that he can get nothing that he wants. He is, in fact, 
 marooned, he might as well be on a desert island. But for the 
 astute correspondents that never offend and never tell what they 
 should keep quiet, life in Berlin is made easy and the path 
 straight. 
 
 "Sometimes a newspaper, say in London, prints an objection- 
 able letter or telegram from Berlin and obtains it from other 
 sources than its regular correspondent. In such a case appar- 
 ently disinterested inquiries are made. The correspondent clears
 
 254 THE PRICE OF INEFFICIENCY 
 
 himself, and all is \rell, for the system is conducted with perfect 
 fairness. Once or twice a careless or youthful correspondent has 
 undertaken to deny the authorship of his own work and woe has 
 been his portion for his indiscretion. In Germany, the govern- 
 ment operates the telegraph ; it can easily discover who sent any 
 particular message in which it may take an interest. 
 
 "The system is ingenious, elaborate, ably conducted and most 
 useful. It amounts to a censorship without the name or ap- 
 pearance of that odious institution, and in another way it is far 
 better than any censorship could be, because it is inspirational 
 and creative, and it is positive, not merely negative, it avoids 
 the unpleasant and spreads the agreeable. 
 
 "For instance, the German government prefers that little be 
 printed about the German navy and that that little shall not be 
 commendatory'. Persistently it has fostered the notion that the 
 German navy is a poor thing lagging at the heels of other navies. 
 As a matter of fact, man for man and ship for ship, it is one of 
 the verj^ best navies afloat, but the world in general does not 
 suspect the fact and the German government is satisfied with 
 the world's ignorance. The German newspapers say so little 
 about the navy of Germany, about the new ships and the prepa- 
 rations and the maneuvers, that when there is some demonstra- 
 tion, like that at Kiel last summer, the unprepared spectator 
 learns with a shock that here is a sea power surely to be reckoned 
 with." 
 
 Other countries pluming themselves over the construction of 
 14" naval guns are disturbed to find Germany in the possession 
 of 15-inch guns, on several ships, though the fact had not been 
 allowed to become public in Germany. 
 
 Germany in the dissemination of news has recently gone to 
 the extent of reducing cable rates, so that cables go direct from 
 Germany to the United States instead of going via London. 
 This has the effect of preventing any possible discoloration of 
 the news while passing through English hands, which has, it is 
 claimed, so frequently occurred. 
 
 Such a discoloration is peculiarly an English expedient, the 
 depreciation of a rival seeming to satisfy the public of its own 
 inferiority. British stupidity is summarized in an interesting 
 manner by iMariano Herggelet, a German writer resident in 
 England for fifteen years, in a recent volume in which he sums 
 up the Englishman's doctrine as follows: 
 
 1. Don't think, reflect, or bother your head about anything.
 
 STIMULATING PROGRESS 255 
 
 2. Don't make any unnecessary exertion. 
 
 3. Don't get excited about your mistakes, neglect, or failure 
 to do things. They don't matter. 
 
 4. Don't learn any foreign languages; there are always plenty 
 of foreigners about to do what may be needed in this line. 
 
 5. Don't change anything until it is too late. 
 
 6. Don't learn anything from other nations. 
 
 7. Don't take any preventive measures — just calmly let 
 calamity approach. 
 
 8. Don't have any exaggerated sense of duty; there are other 
 people for that. 
 
 9. Be sure to forget everything promptly; a long memory 
 simply disturbs the peace of the soul. 
 
 10. Keep no promises, except when they concern pleasure or 
 sport. 
 
 11. Never be thorough — do only what is absolutely necessary. 
 
 12. Don't begin anything too soon. "Maiiana!" To-morrow 
 is another day. 
 
 13. Remember that unconcern and indifference will carry 
 you gently and pleasantly through life. 
 
 14. Remember that superficiality and comfort save trouble 
 and beautify existence. 
 
 15. Dream, idle happily, lull yourself with delicious thoughts 
 of riches and sport, sleep long, eat much, work lightly and little, 
 spend a quarter of an hour daily inveighing against your exas- 
 perating political opponents, pay your taxes, be satisfied, believe 
 implicitly in the natural superiority of the British Nation, and 
 act pleasantly toward everybody, so far as externals are con- 
 cerned. 
 
 There can be no doubt of the accuracy'' of this estimate of Eng- 
 lish characteristics, as it is attested by numerous other obsei*\'ers. 
 Traits such as these are in fact more or less evident in all Anglo- 
 Saxon races of modern times. It might not be unprofitable for 
 them to seek example for improvement from the German descend- 
 ants of the original parent stock which boasts a history of fifteen 
 centuries before the branching off of the Anglo-Saxon branch. 
 Many of the traits which have proved so disastrous to the 
 English people are jeopardizing American institutions and are 
 the basis of our present inability to cope with conditions which 
 have arisen. They are the primary cause of the unequal dis- 
 tribution of wealth which is the most serious condition in this 
 country to-day, wiiere 3% of the people own 20% of the wealth,
 
 256 THE PRICE OF INEFFICIENCY 
 
 and 9% of the people own 51% of the wealth, and 88% but 
 29% of the wealth, while in Germany only 2% of the wealth is 
 held by the rich, 54% being held by the middle classes and 44% 
 by the lower classes. 
 
 Wealth in Germany is more uniformly distributed than in any 
 other country, due largely to the efficient administrative system, 
 while prosperity is very rapidly increasing. The average sav- 
 ings deposited in savings banks per capita of the whole popula- 
 tion, in 1910 w^as in round numbers as follows: Germany $64, 
 United States $46, France $28 and Great Britain $24, while the 
 number of depositors was 21, 9, 14 and 13 millions respectively. 
 From this it will be seen that nine million depositors in the 
 United States saved a little more than did twenty-one millions 
 in Germany, and that only one person in nine saves in the 
 United States to one in three in Germany. This shows still 
 further an unequal distribution of wealth in the United States. 
 
 A few laws or hurried emergency measures will not be suffi- 
 cient to cause any considerable redistribution of wealth in this 
 country. The condition is one which goes vitally into the habits 
 and characteristics of the people and a fundamental realign- 
 ment will be necessary to effect the cure.
 
 CHAPTER XVII 
 UNDEVELOPED RESOURCES 
 
 The magical triumphs of modern chemistry and cncinoerinp — Coinin" the 
 air — Romance of air nitrate — How it supplements dwindling resources 
 — Soil fertility and its meaning to mankind — Norwegian air nitrate 
 factories — Cyanamid as produced in Canada — Great natural wealth of 
 the United States in water powers — Waste of 200,000,000 horse power 
 annually — Costly ignorance of American engineers on hydroelectric sub- 
 jects — The decline of American waterways — Ruthless methods of rail- 
 ways — Bright future of waterways, due to recent legislation — How 
 cheap water transportation has enabled the United States to command 
 the world's iron markets — Negk-ct of waterways and England's de- 
 cay — Fatal self-satisfaction of English iron masters — Marvelous de- 
 velopments of German waterways — Why the tonnage of the Rhine is 
 100 times that of the Mississippi — Berlin the center of a web of 
 canals — The extravagance of the "pork barrel" in Congress — Decline 
 of the port of St. Louis — Receipts of modern canals — Electric towing 
 — Lack of progress in manufacturing electrical implements — Co-opera- 
 tion of farmer and engineer — How it will double the farmer's earnings 
 — Details of electric farm machinery — Lower cost of electricity on the 
 farm — Multiplicity of uses of the electric motor — Electric plowing 
 superseding the most ancient of labors — Profits of farm by products — 
 Harvesting by electric light. 
 
 Op the great triumphs of modern chemistry and engineering, 
 the reduction of the nitrogen of the air to a commercial product 
 is one of the most notable that has ever been achieved. It is 
 far reaching in effect and appeals to the imagination as few 
 discoveries have ever done. 
 
 To get a tangible and salable substance, and one of the high- 
 est value to mankind, out of the impalpable air is a result that 
 few would have dared predict a generation ago. 
 
 The great value of the discovery of the production of air 
 nitrate is realized but little by the general public ; but it may be 
 understood when the fact is known that the natural supply of 
 nitrate, which is known most commonly in the form of saltpeter, 
 is near the point of exhaustion. Nitric acid is one of the funda- 
 mentals in the arts and nitrate is the principal fertilizer of the 
 world, while saltpeter is an indispensable element of explosives. 
 
 Besides these, there are a great number of important uses of 
 
 257
 
 258 THE PRICE OF INEFFICIENCY 
 
 nitrate, such as in the form of ammonia, etc., and a synthetic 
 source of supply is therefore of enormous importance. 
 
 If before the discovery of air nitrate, the world's supply had 
 been exhausted or cornered by some aggressive nation, the rest 
 of the world, without explosives, would have been at its mercy, 
 and an incalculable impoverishment of the earth's soil through 
 the cutting off of the supply of nitrates would have resulted. 
 
 One of the greatest problems of the present time is to increase 
 the fertility of the soil. The growing crops are constantly ex- 
 tracting from the soil three chemical substances, — nitrogen, 
 potassium and phosphoric acid, — and it is necessary that they 
 should be replaced in a form available for plant life. 
 
 The nitrate which has previously been used to improve the 
 soil has come entirely from manures worked into the soil, supple- 
 mented of late years, owing to the insufficient supply and cost 
 of manures, by deposits of nitrate of soda taken from South 
 America, and sulphate of ammonia recovered as a by-product 
 when coal gas is made. 
 
 The output of Chili saltpeter, or nitrate of soda, is at the 
 rate of 1,500,000 tons per annum, and it has doubled in the last 
 fifteen years, while 500,000 tons of sulphate of ammonia are pro- 
 duced annually. Owing to its high cost and scarcity, the de- 
 mand is very much less than would be the case for a cheaper 
 fertilizer. 
 
 The production of nitrates from the air, which, unlike water, 
 is a mechanical mixture of various gases and not a chemical 
 unity, will assist in keeping the composition of the air in a bal- 
 anced condition, as most of the huge chemical processes of nature 
 involve oxygen. The production of air nitrate assures inex- 
 haustible supplies of a highly necessary substance since the air 
 contains about 80% of nitrogen; and in addition it affords a 
 means of utilizing water power, which under ordinary con- 
 ditions, being of great volume at some seasons of the year 
 and very much less at other periods, can only be partially 
 utilized. 
 
 The energy thus running to waste amounts to an enormous 
 total, and the production of air nitrate affords a means of trans- 
 forming the waste energy of rainfall into soil fertility. 
 
 The Department of Commerce and Labor in its report on the 
 manufacture of air nitrate fertilizers says: 
 
 "The original inventor of the electro-chemical process for 
 manufacturing nitrate fertilizers and other chemical produc-
 
 UNDEVELOPED RESOURCES 259 
 
 tions from the air was Prof. Birkcland, a NonN'egian by birth. 
 After Prof. Birkeiand had made his discover^', some nine or 
 ten years ago, he associated himself with Mr. S. Eyde, an ex- 
 perienced civil engineer. 
 
 "By experimenting on a small scale, it was ascertained that 
 their electro-chemical process for the production of nitrate fer- 
 tilizers from the atmosphere was likely to prove a success. 
 Their process and subsequently their improvements and new in- 
 ventions have been patented in the majority of European coun- 
 tries as well as in the United States. They organized a stock 
 company entitled Aktieselskabet de Norske Kvalstofkompani, 
 with a capital of $134,000 with which their first plant was 
 built at Notodden, in Telemarken, some 70 miles from Chris- 
 tiania. 
 
 "Regarding the method by which the Birkeland-Eyde lime 
 saltpeter or calcium nitrate is produced, it should in the first 
 place be noted that it is a new way of utilizing electricity, al- 
 though it is a succession of the experiments which the English 
 physiologist, Cavendish, made in the eighteenth century, by 
 which he produced combinations between the nitrogen and the 
 oxygen of the atmosphere by letting electrical discharges pass 
 through the air during the presence of a decomposition of alkali, 
 and whereby he succeeded in producing small qualities of nitric 
 acid. The Birkeland-Eyde method is in principle the carrying 
 out on a larger scale of the same process as Cavendish started 
 on a smaller one, with this difference, however, that Birkeiand 
 and Eyde have introduced new auxiliaries, which in themselves 
 constitute highly original discoveries." 
 
 The process, briefly stated, is to pass air through an enormous 
 electrical flame, of about 75 inches in width, which heats the 
 air to 3,000 degrees Celsius, and the gases are then cooled and 
 passed over lime in water, resulting in calcium nitrate which is 
 sold in granular form like salt. 
 
 The company later consolidated with the Badische Anilin und 
 Sodafabrick, a German concern, which had added improvements, 
 and there are now several branch companies, with a total capi- 
 tal of over $16,000,000 all paid up, while the annual production 
 will soon reach 80,000 tons. 
 
 Two German chemists, Adolph Frank and Nikoderaus Caro, 
 of the technical staff of the Simens-Halske Co., a great electri- 
 cal firm, have discovered an entirely dift'erent process of extract- 
 ing nitrate from the air. They combine coke and lime at 3,000
 
 260 THE PRICE OF INEFFICIENCY 
 
 degrees Centigrade, resulting in a substance that has a great 
 affinity for nitrogen, and draws it directly from the air. This 
 is known as the cyanamid process and is a strong competitor of 
 the Birkeland-Eyde process. Cyanamid is equally if not more 
 valuable as a fertiliser and is easier to handle in its commercial 
 form, being less liable to liquefy and cake. 
 
 Twelve companies will manufacture it in Europe, six of which 
 are already in operation, while a plant has been erected on the 
 Canadian side of Niagara Falls. The foreign plants have a 
 capacity of 167,000 tons annually. Plants are in course of erec- 
 tion in Japan, Mexico and other countries. 
 
 Cyanamid sells at $55 to $60 a ton at present. Tests by 37 
 various governmental stations in Europe show its superior value 
 as compared with Chili saltpeter as a fertilizer. 
 
 The United States has $70,000,000 invested in fertilizer fac- 
 tories of various kinds. Chilian saltpeter to the value of $75,- 
 000,000 annually at two and one half times its former price is 
 exported by Chili, $15,000,000 of which comes to the United 
 States, and yet while, with almost criminal carelessness, we dis- 
 regard our own resources and allow phosphate rock to be exported 
 in large quantities, our imports of fertilizers of various kinds are 
 $17,000,000 in excess of our exports annually. The whole of this 
 amount could be saved by the erection of hydro-electric plants 
 to utilize our vast wasted water power and to manufacture air 
 nitrates. 
 
 The opportunity of the United States in this respect is unusual, 
 since we have an enormous amount of water power going to 
 waste, a condition not found in Europe, where a large part of 
 the available power has already been utilized, while the total is 
 vastly smaller than in the United States. 
 
 Norway has five and one half times the available water power 
 of Germany and has 3,409 horse power available per 1,000 inhab- 
 itants, while Great Britain and Germany have only 23.1 and 24.5 
 per 1,000 inhabitants and but 3.06 and 2.6 horse power per square 
 kilometer respectively (1 sq. kilometer equals 0.386 sq. miles). 
 Switzerland, Sweden and Italy are next in order, Switzerland 
 having 36.6 horse power per sq. kilometer, the largest of any, but 
 practically all utilized. The following table, taken from the 
 author's article, "Hydro-electric Engineering Practice" in the 
 Engineering Magazine, shows the available horse power of the 
 several countries:
 
 UNDEVELOPED RESOURCES 261 
 
 Great Britain 903,000 H.P. 
 
 Germany 1,425,900 H.P. 
 
 Switzerland 1,500,000 u.p. 
 
 Italy 5,500,000 h.p. 
 
 France 5,857,000 h.p. 
 
 Austria Hungary 6,460,000 H.p. 
 
 Sweden 6,750,000 H.P. 
 
 Norway 7,500,000 h.p. 
 
 Total 3'5,965,900 h.p. 
 
 The United States has a total of 30,000,000 horse power in 
 water power running to waste. If properly utilized by means 
 of storage, economically constructed and properly designed plants 
 following the latest European practice, this would amount to 
 from 150,000,000 to 200,000,000 horse power. A steam horse 
 power per year costs $20 so that a waste of power of $4,000,000,- 
 000 is occurring annually. 
 
 Air nitrate cannot be economically produced by means of 
 steam power as a lower cost per annual horse power is required 
 than can be obtained with coal. 
 
 The utilization of water power in the United States has been 
 greatly retarded by two main causes. The first is the fact that 
 hydro-electric engineering is comparatively little understood in 
 the United States, and a great number of plants have been 
 erected by incompetent and inexperienced engineers so that they 
 cannot even compete with steam power plants. 
 
 Not only are the plants usually badly designed, but the ma- 
 chinery is inferior. So little understood is this branch of work 
 that the first book in the English language on the subject of the 
 design of water wheels and turbines has only recently been an- 
 nounced for publication, and it is a translation of a German book 
 not of the first class. The most successful manufacturers of tur- 
 bines and water wheels in the United States employ German 
 engineers and first copy foreign machinery, and then have the 
 audacity to claim that the originals are imitations of their manu- 
 factures. A policy of bluff of this kind has some effect in a com- 
 mercial way, but the forces of nature cannot be bluffed into ac- 
 complishing efficient results with inefficient machinery. 
 
 Progress in engineering depends on the interchange of ideas 
 between the engineers of various countries the world over, and 
 the American engineer in this respect has not kept up to date. 
 The latest European practice is knoA^-n to but few, and the prac- 
 ticability of building water power plants on an economical scale,
 
 262 THE PRICE OF INEFFICIENCY 
 
 which will be able to compete with steam and also to furnish 
 power cheaply enough to justify the manufacture of air nitrate 
 commercially here as it is abroad on such a large scale, is not 
 therefore known to the capitalist, who does not accordingly in- 
 vest. The progress of the whole country is thus held back by 
 the ignorance and incompetency of its engineers, vast agricul- 
 tural benefits lost and stagnation inflicted where there might be 
 prosperity, all on account of engineering inefficiency. 
 
 Our American engineers either build too strong or too weak. 
 They dislike the complicated calculations necessary to ascertain 
 the proper size of members and constructions. It is not a ques- 
 tion of ability to make the calculations, but they are simply not 
 thorough and do not do it. The result is that there is a vast 
 waste in all kinds of engineering projects. The cost of bridges, 
 skyscrapers and other works is greatly more than it should be 
 through use of too much steel and other materials, and machinery 
 of all kinds, though compact in appearance, is inefficient in 
 operation. 
 
 This tendency when applied to water power plants eliminates 
 them entirely, and thus a vast industry is still born through engi- 
 neering incompetency. Bankers will not advance money for new 
 projects and the incompetent engineer himself not only keeps 
 capital idle, but being idle himself, discourages by his example 
 brighter men from seeking to enter the profession. 
 
 Engineering incompetence exhibits itself in lack of experience 
 largely and in the building of constructions in a haphazard man- 
 ner. Either too great a margin of safety is allowed on the one 
 hand or else too much risk is taken on the other, as may be seen 
 in the failure of the Austin dam and the Quebec bridge. 
 
 The second cause which retards the development of water 
 power in the United States is the uncertain attitude of the gov- 
 ernment. 
 
 The government scented a water power site trust, which if it 
 does exist should have been nipped in the bud in the first place, 
 and has accordingly withdrawn many of the concessions and has 
 the whole situation bottled up. The fear that capital will make 
 too much is in this case, as in many others in the United States, 
 the cause of much of the stagnation existing. 
 
 The inability of the government and private capital to reach 
 a working arrangement retards the water power developments, 
 and in the meantime horse power to the value of $10,000,000 a 
 day goes to waste.
 
 UNDEVELOPED RESOURCES 263 
 
 The United States, on the other hand, is standing: at a new era 
 in the development of its water transportation. The use of the 
 great waterways, the Mississippi, the ^Missouri, the Ohio and 
 their tributaries and water transportation on the great lakes and 
 through the many important canals is about to be restored. 
 
 If public opinion secures the enforcement of the recent amend- 
 ment to the Court of Commerce Act introduced by Senator Bur- 
 ton of Ohio, the millions that have been spent in waterways and 
 their improvement will begin to bear fruit. 
 
 The practical extinction of water transportation in the United 
 States, as in England, has been due to the fact that railroads 
 were allowed unbridled and destructive competition. Railroads, 
 at a loss to themselves, have cut rates to a point where the water 
 transportation companies, unless powerfully organized, have been 
 driven out of business. Then wdth competition gone, the rail- 
 roads raised freight back to the original point or higher. The 
 waterways, fearing a repetition of the same treatment, have not 
 ventured to reenter the field again. 
 
 This process reduced river traffic at St. Louis from 2,130,525 
 tons in 1880 to 374,093 in 1909. A corresponding section of the 
 Rhine carries 40,000,000 tons annually. The IMississippi is thus 
 a graveyard of waters, her commerce assassinated by the rail- 
 roads. 
 
 This condition, however, should be changed by Senator Bur- 
 ton's amendment, which in effect provides that if a railroad 
 reduces rates in competition with a waterway, it cannot again 
 increase them after the waterway succumbs. This will give the 
 waterways an opportunity to compete on equal terms. A similar 
 law fundamentally applied to all business would save a vast pro- 
 portion of the business failures of the United States and go a 
 long way towards solving the trust problem. 
 
 The heretofore ruthless domination of the railroads has re- 
 sulted in a dog in the manger situation, the railroads having 
 but 60% of the capacity necessary to handle the traffic of the 
 countiy, even at their extortionate rates. Car famines and con- 
 gestion of traffic with no prospect of relief in either facilities or 
 rates is the situation that will be relieved by the operation of the 
 new law if it proves successful. 
 
 How important cheap water transportation is may be seen 
 from the condition of the iron business. In Germany water 
 transportation under governmental encouragement and in the 
 United States under conditions of ownership in which the self-
 
 264 THE PEICE OF INEFFICIENCY 
 
 interest of the railroads did not throttle it, has been the factor of 
 most importance in the realignment of the iron producing 
 nations. 
 
 The Department of Commerce and Labor in its Bulletin of 
 January, 1909, states in part: 
 
 ' ' The German iron and steel industry is the growth of the last 
 quarter of a century. Within that period Germany has distanced 
 Great Britain and has become second only to the United 
 States in raw iron production. In 1885, the production 
 of Great Britain was 7,534,000 metric tons, the United States, 
 4,109,000 and Germany 3,687,000. By the end of 1907 the rela- 
 tive positions of the three countries which together produced 
 81% of the world's raw iron was: United States, 26,194,000; 
 Germany, 13,046,000 and Great Britain, 10,083,000 metric tons. 
 
 "In the conversion of raw iron, that is in making steel, the 
 change has been even more momentous. In 1900, when Germany 
 passed Great Britain, the figures of steel production were : United 
 States, 10,382,000; Germany, 6,646,000, and Great Britain, 
 5,131,000 metric tons. In 1907, the steel production of the three 
 countries, comprising approximately 80% of the world's total, 
 stood : United States, 23,733,000 ; Germany, 12,064,000 and Great 
 Britain, 6,627,000 metric tons." 
 
 These figures are an explanation of the larger part of the dis- 
 affection existing in England. The loss of dominance in such a 
 vast industry in less than a generation is a staggering blow to 
 British self-satisfaction. Its possibility, while foreseen by Ger- 
 man and American engineers, was brushed aside as an impossi- 
 bility by British experts. 
 
 The preliminary report of the Inland Waterways Commission, 
 1908, states : 
 
 "More than twenty years ago, a British student of commercial 
 conditions visited the United States to investigate the outlook of 
 the iron and steel industry in this country. On his return home, 
 he gave assurances to British iron manufacturers that they need 
 have no serious fears of the competition of the United States, be- 
 cause in America the great iron ore deposits were too far distant 
 from coal. He was positive it would never be possible to bring 
 the ore to the coal or the coal to the ore at such rates as would 
 enable production of iron and steel cheap enough to compete 
 with England. 
 
 "How completely erroneous was this conclusion need not be 
 suggested now, because everybody is familiar with the marvelous
 
 UNDEVELOPED RESOURCES 265 
 
 facilities for bringing the Lake Superior ores to the Pittsburg 
 iron district, and witli the success of the American iron and steel 
 industry in competing with all the world, despite the initial dis- 
 advantages they had to overcome. Witnesses before the British 
 Royal Commission repeatedly declared that the process of bring- 
 ing the Lake Superior ores to the docks on the upper lake, first 
 by rail, then by Lakes Superior, Huron and Erie to ports conven- 
 ient to the coal districts and finally by rail to the seats of the iron 
 industry is the greatest achievement in transportation the world 
 has ever seen. 
 
 "So much for the British ironmakers' error in underrating the 
 possibilities of internal transportation in the United States. As 
 to Germany, their error was hardly less striking. In the begin- 
 nings of the development of the great German iron trade, Eng- 
 lish iron interests declined to take German competition seriously, 
 because the government ore deposits were considered utterly in- 
 adequate for the development of a really great industry, and it 
 was presumed that the transportation of great quantities of ore 
 to the seats of the German industries would be so expensive as 
 to make it utterly unprofitable. Yet, in fact, the Germans have 
 developed an iron industry which is now a matter of concern to 
 every competing country, and which is based, like that of the 
 United States, on a system of extremely cheap water transporta- 
 tion. While there is a large and increasing production of iron 
 ore in Luxemburg, which is utilized in the German iron industry, 
 and while Germany itself produces a large and gi'owing annual 
 tonnage of ore, and brings still other amounts from Austria- 
 Hungary, it is nevertheless true that the major part of the iron 
 ore reduced in Germany comes from the Scandinavian peninsula 
 and from Spain. To the canals and canalized rivers of the em- 
 pire is due the credit for maldng it possible to thus bring foreign 
 ores to the German industrial regions. Exceedingly low rates 
 are made and the tonnage handled by rivers and canals is tre- 
 mendous. 
 
 "Thus it appears that both in Germany and the United States 
 the development of the utmost possibilities of cheap inland 
 water communication is entitled to recognition for having made 
 possible the upbuilding of the industries which a generation ago 
 seemed economically impossible. With their great supplies of 
 coal and ore located very close together, and with ocean trans- 
 portation at their door, British manufacturers seemed sure of a 
 domination in the world's iron trade that could only be ended
 
 266 THE PRICE OF INEFFICIENCY 
 
 by exhaustion of their supplies of coal or iron. A very different 
 situation has been brought about largely by the utilization of in- 
 ternal water transportation in the United States and Germany. 
 This one object lesson has deeply impressed the British com- 
 munity, and in no small measure has been responsible for the 
 present agitation of the waterways question. 
 
 ' ' Great Britain is the one exception among the industrial coun- 
 tries of Europe to the rule of encouraging both rail and water 
 transportation. British railroad policy has aimed at the suppres- 
 sion of waterway competition, and has pretty thoroughly suc- 
 ceeded. To-day the British business community finds itself 
 paying higher transportation tolls than continental countries, and 
 because of this fact is at a great and increasing disadvantage in 
 competitive markets. 
 
 ' ' So serious has this situation come to be considered by British 
 traders that Parliament has taken cognizance of the demand for 
 rehabilitation of waterways, and a careful inquiry into the entire 
 subject of water and rail transportation is now being carried on 
 by the board of trade. 
 
 "It seems interesting and significant that Great Britain and 
 the United States are the only industrial countries of the first 
 class in which water transportation has so long been neglected, 
 and it is a suggestive fact that in both these countries a powerful 
 opinion has lately developed in favor of following the lead of 
 continental nations, emancipating the waterways from railroad 
 domination and vigorously developing them as an independent 
 factor in transportation." 
 
 No country has developed its waterways to the extent that 
 Germany has and the results achieved are astonishing. 
 
 Hubert Bruce Fuller in an article, "European Waterways," 
 in the Review of Reviews, for May, 1911, describes the German 
 system : 
 
 "The great aim of Prince Bismarck was a compact and per- 
 manent German Empire. He believed that nothing would so 
 much contribute to this end as the improvement of transportation 
 facilities and their control by the central government. After the 
 Franco-German war, Bismarck set himself to the task of modern- 
 izing and extending the German waterways system. The essen- 
 tial dogma of the German commercial creed is that the water- 
 ways must be maintained by the state if they cannot maintain 
 themselves. 
 
 ' ' The German canal system is based upon the practical utiliza-
 
 UNDEVELOPED RESOURCES 267 
 
 tion of the great rivers, their improvement and connection by a 
 scientific and practical system of canals. 
 
 ' ' The Rhine, the most important and the largest German river, 
 flows through Holland at its mouth, but it is developed and main- 
 tained as a great artery of German commerce. East of the Rhine 
 in order are the Weser, the Elbe, the Oder and the Vistula, all 
 of which have been improved by the German government and 
 now carrj^ an enormous and constantly increasing tonnage. 
 
 ' ' Owing to the supreme importance of the Rhine, the Gennan 
 government early saw the desirability, both from a commercial 
 and military point of view, of securing a connection within Ger- 
 man territory by which boats could reach the Rhine from a North 
 Sea German port. The solution was the Dortmund-Ems canal, 
 connecting with the Rhine near the Dutch border and extending 
 northwestwardly to the North Sea at Emden. 
 
 ' ' The German Rhine is commercially the most important stream 
 in the world. It furnishes a most illuminating contrast to the 
 decadent Mississippi. The United States has expended more 
 money in the twenty years ending in 1907 on the most important 
 stretch of the ]\Iississippi, 206 miles between St. Louis and Cairo, 
 than the German central government has expended in the im- 
 provement of the Rhine from Strasburg to the frontier of Hol- 
 land, a distance of 355 miles. Yet the amount of tonnage 
 handled on this portion of the Mississippi was 374,093 tons in 
 the year of 1908, w^hile that on the Rhine in the same year was 
 between 40,000,000 and 45,000,000 tons, an amount from eighty 
 to one hundred times as much. 
 
 ''The Elbe carries 20,000,000 tons of freight a year. The 
 Oder River at its upper end at Breslau and Kosel even in these 
 shallow reaches, carries 3,500,000 tons of freight a year. This 
 river, though small, carries more traffic each year than the entire 
 Mississippi. The reason is that the German people use sane 
 methods, modern barges and towboats and efficient terminal 
 handling apparatus. 
 
 "The city of Berlin is to-day the center and market place of a 
 labyrinth of canals and canalized water courses. The Spree and 
 Havel, with their network of canals reaching from the Elbe and 
 Oder, have made possible the prosperity of modern Berlin, 
 These rivers and tributary and connecting canals are at all times 
 crowded with boats bringing the coal and briquettes of Silesia, 
 timber, stone, bricks, lime, fruit and other heaw freight from 
 the interior, and give Berlin direct water communication with
 
 268 THE PRICE OF INEFFICIENCY 
 
 Hamburg and Stettin. Modern Berlin with its 2,000,000 inhab- 
 itants and its vast industries, would never have been possible 
 except for the combination of natural and artificial watercourses 
 which have given easy and cheap transportation for fuel, build- 
 ing and other raw materials. The Maerkischen, Wasserstrassen, 
 or marsh canals, which lead from the Oder and the Elbe to Ber- 
 lin, are none of them more than six feet deep. Yet they carry 
 13,000,000 tons of frieght each year." 
 
 The inefficiency of the congressional system of government is 
 nowhere so glaringly evident as in our treatment of the canal 
 and water systems. The "pork barrel" is here most openly in 
 evidence. The improvement of waterways for the purpose of 
 circulating money in the locality of the favored congressman 
 has resulted in a vast system of improvements, pursued without 
 reference to any organized plan, and to practically no useful end. 
 
 Millions have been thrown into the work of improving water- 
 ways while the railroads were all the while killing water trans- 
 portation, so that the more highly improved the waterways be- 
 came, the less traffic they carried. 
 
 The lack of reason showTi in our river improvements is obvious 
 at many points. For example, the Green River has a channel 
 of 6 to 8 feet v/hile the Ohio into which it flows has at certain 
 seasons but four feet. The lesser is thus made deeper than the 
 greater. 
 
 Mr. Hubert Bruce Fuller in ''The Crime of the Pork Barrel," 
 in the World's Work, of August, 1910, says: 
 
 "A good illustration is the condition of traffic on the Tennes- 
 see River near Chattanooga, where the Muscle Shoals canal has 
 been built at a cost of $3,191,726. More than $1,100,000 has been 
 expended for repairs and maintenance since completion. In the 
 year 1908, $53,443 was expended for this purpose. The amount 
 of freight of all classes carried through this canal in 1908 was 
 12,539 tons. It fluctuates from year to year, but that is a fair 
 average. Thus, simply based upon the amount expended for 
 maintenance and repairs for the year 1908 — the last for which 
 figures are available — the cost to the people of the United States 
 was $4.26 for eveiy ton of freight carried. And if we compute 
 interest at 3% on the original cost of improvements, a further 
 sum of $7.65 per ton must be added, making a total of $11.91 
 for every ton of freight passing through this canal. 
 
 "It cost $38,218.50 to maintain a lock and dam in the Wabash 
 River at Grand Rapids, Illinois and Indiana, in 1908. The total
 
 UNDEVELOPED RESOURCES 269 
 
 traffic through this lock for the same year was 5,121 tons of which 
 more than 4,440 tons were lumber and timber. Lumber and tim- 
 ber do not require canalization for their transportation, since 
 they can best be carried by rafts floated or poled down stream. 
 A balance then of 680 tons, remains of corn, shells and miscel- 
 laneous freight. The mere cost of maintaining this lock, there- 
 fore, was approximately $7.46 per ton for all classes, including 
 lumber in its various forms, and $56 for every ton of freight 
 carried through it excluding lumber. 
 
 "The Mississippi River, famed in history and tradition, is a 
 notable object-lesson for the student of American waterways. 
 On the entire river between St. Paul and New Orleans, the gov- 
 ernment has expended more than $90,000,000. In 1880 fourteen 
 times as much river freight was received and shipped at St. Louis 
 as in 1909, when it amounted to but 374,093 tons. 
 
 RIVER BUSINESS, PORT OF ST. LOUIS 
 
 Total boats Total tons of Total tons Grand 
 
 Yeab arrived freight rec'd freight shipped total tons 
 
 1880 4,692 1,092,175 1,038,350 2,130,525 
 
 1881 3,951 1,208,430 884,025 2,092,455 
 
 1890 3,201 663,730 617,985 1,281,715 
 
 1891 2,900 592,140 512,930 1,105,070 
 
 1900 2,217 612,010 245,580 757,590 
 
 1909 374,093 
 
 ' ' The United States has spent more on this stretch of 205 miles 
 of the Mississippi than the central government of Germany has 
 expended for the improvement of the Rhine from Strasburg to 
 the frontier of Holland, a distance of 355 miles. Yet on this 
 section of the Rhine the total tonnage in 1908 was approximately 
 40,000,000 tons as against less than 375,000 tons on the JNIissis- 
 sippi as has been pointed out. The United States has spent more 
 on the Mississippi River than any other government has spent 
 on any other stream in the world. And we could take the 40,- 
 000,000 tons of traffic of the Rhine and handle it with better ad- 
 vantage on the Mississippi with room for untold millions more. 
 The simple fact remains that the Mississippi to-day possesses the 
 channel, but it is not used. ' ' 
 
 As an illustration of what may be expected in American water- 
 way transportation under the new law, examples may be taken 
 of German traffic. 
 
 The Duisburg-Ruhrort district had a tonnage of 2,935,000 in
 
 270 THE PRICE OF INEFFICIENCY 
 
 1875. In 1905 this had increased to 19,462,000. Berlin and 
 Charlottenburg increased from 3,239,000 to 10,114,000 and Ham- 
 burg from 799,000 to 7,853,000 during the same period. 
 
 The total length of all navigable waters in Germany is 10,000 
 kilometers (6,000 miles) while there are 54,000 kilometers (32,- 
 400 miles) of railroads. The railroad receipts are $500,000,000 
 a year, and the expenses $350,000,000, leaving a net profit of 
 $150,000,000 (for year 1909). The railroads haul 45,000,000,000 
 ton-kilometers per year while the waterways haul 15,000,000,000 
 ton-kilometers. The waterways, less than one-fifth the length of 
 the railways, thus handle 25% of the total traffic. (Govern- 
 mental report, 1905.) 
 
 The average charges on the railroads are one and one-tenth 
 cents per ton-mile, while on waterways the average is but four- 
 tenths of a cent per ton-mile. 
 
 The above railroad receipts include passenger as well as freight 
 receipts as the German government controls the railroads. The 
 passenger charges per mile are as foUo^'s: First class, 2.8 cents, 
 second class 1.76 cents, third class 1.2 cents and fourth class .8 
 cents. 
 
 If the United States is to achieve the proper results the water- 
 ways must be conducted on modern principles. The old towpath, 
 the mule and the barefoot boy, made famous in Garfield's case, 
 must no longer be in evidence. Instead, canals must take ad- 
 vantage of electrical development. The latest practice in Europe 
 is to drive them as trolley cars, with a wire overhead and the 
 barge motor driven, or where this is too expensive, or produces 
 too much wash, a small trolley engine of special design runs 
 alongside, either on tracks or on a roadway, and taking power 
 from central stations along the lines, draws the barges at a speed 
 which makes the canal a real rival of the railroad. 
 
 The engineering features of electric haulage for canals are 
 highly developed in Germany, but it is an almost unknown in- 
 dustry in this country. 
 
 The development of canals in such a manner will produce an 
 effect in manufacturing similar to the creation of suburbs by 
 trolleys. If the German policj'' is followed, that of decentraliza- 
 tion of industries, manufacturing plants now congested in large 
 cities will be widely distributed. The rapid development of 
 canals in Germany produced at first considerable speculation in 
 land alongside, but the government now condemns a kilometer 
 (.06 of a mile) on each side of the canal, and then sells the land
 
 UNDEVELOPED RESOURCES 271 
 
 in such a way as to encourage its plan of the decentralization of 
 industries. 
 
 This plan should also be adopted in the United States, and a 
 beginning has been attempted in New York state, where a recent 
 amendment of the constitution proposed that the city, in opening 
 new streets could condemn additional strips on either side the 
 re-sale of which would repay in most cases the cost of the im- 
 provements. This amendment, however, was defeated. 
 
 To obtain the best results, our waterways must have a broad 
 administrative policy, free from politics and be constructed by 
 engineers of the highest skill. Such waterways will repay richly 
 all that may be invested in them. The increased facilities will 
 benefit no one as much as the farmer whose products are bulk)' 
 and being in staple form largely, do not require rapid transpor- 
 tation. The example of the use of electrical power on canals 
 will be of great value to agriculture for here also electricity can 
 be used to the greatest advantage. The tendency of the average 
 producer is to ignore new machinery. This is particularly true 
 of the farmer, the slowest of all to adopt new machinen,% except 
 the fire departments, which show the most stubborn and costly 
 neglect of new devices. The farmer, though his manual labor 
 is of the hardest, adopts new machinery with the greatest reluc- 
 tance, and when he does he allows his machinery- often to stand 
 unprotected in the open field through the M'inter for use the 
 next season. His failure to take advantage of his mechanical 
 opportunities is costly alike to himself and to the whole country. 
 
 The electric plow, long successfully in use abroad, effecting the 
 greatest savings, has not yet scratched the earth in the United 
 States and has been completely ignored by our manufacturers 
 who do not desire to take up new devices which cannot readily 
 be standardized. The general use of electricity on farms and in 
 rural industries is also entirely neglected. 
 
 But the use of electricity on our farms is sure to be greatly 
 increased with the progress of intensive cultivation, which is be- 
 coming an acute national need; and the farmer and the rural 
 industries in general should take advantage of the engineering 
 profession, to utilize our national resources through the medium 
 of electricity, for the benefit and welfare of our country as a 
 whole. The present decade will be notable for our fanners for 
 its scientific agricultural developments with the aid of electricity. 
 
 No sharp line of demarkation exists between farm and urban 
 power needs and electrical power should benefit the farmer as
 
 272 THE PRICE OP INEFFICIENCY 
 
 -well as the city man. As a class, the farmer is a large user 
 of power, but the sources from which he draws it are at present 
 inefficient and uneconomical, compared with industrial standards 
 in other lines. Of the 29,000,000 persons engaged in gainful 
 occupations, reported by the United States 1900 census, about 
 10,000,000 devote their energies to the farm. About 89% of the 
 horses and mules in this country are also at work on the farm. 
 The farmer uses more implements and a greater variety of me- 
 chanical devices than any other class, and it is important that 
 he should co-operate with the engineer in order to take advant- 
 age of our national resources, to replace the much sought for 
 and the much needed manual labor, to cut down considerably the 
 number of draft animals, to make the farm produce more, and to 
 make rural life more congenial and agreeable. 
 
 Better methods of agriculture are of such vast importance to 
 everyone, farmer and consumer alike, that the following resume 
 of the present state of electricity on the farm taken from a series 
 of articles by the author, under the title, "Domestic and Rural 
 Applications of Electricity, ' ' in the Electrical Review and West- 
 ern Electrician, should prove in the nature of a revelation to the 
 layman. 
 
 "There is no mechanical power which can supplant as con- 
 veniently and cheaply, manual and animal labor on the farm 
 or country estate, as electricity. Electricity is far superior 
 for supplying energy to steam or any internal combustion 
 engine. In fact, there is no other agent which can supply 
 alf three necessities, light, heat and power from the same 
 source. Due to this fact, working hours on the farm and 
 other rural industries can be regulated, similar to city or 
 other commercial industries, and life in rural communities 
 can be made equally if not more attractive, than that found 
 in the cities, where the struggle for existence is incessant, and the 
 living accommodations, or what corresponds to home life, falls far 
 short of the pleasant and healthful occupations of the counti-y, 
 and the agreeable surroundings found in the rural communities. 
 
 "Our giant industries are of recent origin and started in a 
 humble w^ay, and now sui-pass and are far superior to any branch 
 of agrarian pursuits. This condition is readily accounted for; 
 the services of the trained engineer were used to advantage in 
 building up our great manufacturing plants, while the farming, 
 though the oldest of industries, has been neglected even to the 
 point of becoming an abandoned industry. ' '
 
 UNDEVELOPED RESOURCES 273 
 
 Up to the present time, especially in America, the aid of 
 the technical man is seldom sought in solving many of the prob- 
 lems which arise in rural industries. Probably there is no bet- 
 ter authoritative statement on the value of technically trained 
 men as an aid to modern farming, than that made by Col. Roose- 
 velt on Aug. 23, 1910, at Ithaca, N. Y. 
 
 "One reason why the great business men of to-day — the great 
 industrial leaders — have gone ahead while the fanner has tended 
 to sag behind the others, is that they are far more willing, indeed 
 eager, to profit by expert and technical knowledge, that can only 
 come as a result of the highest education. From railways to fac- 
 tories no great industrial concern can nowadays be carried on, 
 save by the aid of a swarm of men who have received a high 
 technical education in electricity, in chemistiy, in engineering, 
 in one or more of a score of special subjects. The big business 
 man, the big railway man, does not ask college trained experts 
 to tell him how to run his business, but he does ask numbers of 
 them to give him expert advice and aid on some one point indis- 
 pensable to his business. He finds this man usually in some grad- 
 uate of a technical school or college, in which he has been trained 
 for his life work. 
 
 "In just the same way, the farmers should benefit by the ad- 
 vice of the technical men who have been trained in phases of the 
 very work the farmer does. I am not now speaking of the man 
 who has had an ordinary general training, whether in school or 
 college. AVhile there should undoubtedly be such a training or 
 foundation (the extent differing according to the kind of work 
 each boy intends to do as a man), it is nevertheless true that 
 our educational system should more and more be turned in the 
 direction of educating men toward, and not away from, the farm 
 and the shop. 
 
 "During the last half century, we have begun to develop a 
 system of agricultural education, at once practical and scientific, 
 and we must go on developing it. But, after developing it, it 
 must be used. The rich man who spends a fortune upon a fancy 
 farm, with entire indifference to cost, does not do much good to 
 farming, but on the other hand, just as little is done by the work- 
 ing fanner who stolidly refuses to profit by the knowledge of the 
 day, who treats any effort at improvement as absurd on its face, 
 and refuses to countenance what he regards as newfangled ideas 
 and contrivances and jeers at all book farming." 
 
 The ex-president voices a sentiment that the farmer should
 
 274 THE PEICE OF INEFFICIENCY 
 
 heed, both for his own benefit as well as for the benefit of human- 
 ity at large, who on account of his lack of progress must pay 
 more for their food and thus have their condition in life rendered 
 more miserable. 
 
 Continuing from the author's article: 
 
 "There are thousands of steam and internal combustion en- 
 gines in use on our farms to-day principally for replacing draft 
 animals and of course a proportionate number of farm hands; 
 they are used with machinery, such as plows and threshers and 
 especially pumps. However, for operating small machinery, 
 such as required in dairies as cow milkers, cream separators, but- 
 ter kneaders, etc., an internal combustion engine could not be as 
 advantageously used as an electric motor, for the reason that the 
 smallest commercial internal combustion engine is about two 
 horse power, while the electric motor may be chosen in capacities 
 of one-tenth horse power and upwards to suit the machine to be 
 operated, and again, no fuel is necessarily carried along, the only 
 requirement being to turn a switch to start the motor. 
 
 "In fact the practice has proven that all farm machinery can 
 advantageously be operated by electric motors. The usually oper- 
 ated machines on the farms are, plows, rollers, reapers, thresh- 
 ers, corn grinders, corn shellers and shredders, fodder cutters, 
 wood saws, horse and sheep clippers, unloading and hoisting hay 
 and other farm products. Another great labor saving in the use 
 of electricity is in serving washing machinery; carpet cleaners, 
 sewing machines, fans; further, heating appliances for cooking 
 purposes and heating irons, all of which could hardly be served 
 with any agent other than electricity. Aside from this, what is 
 mostly needed is light, and the electric light is the only light. As 
 electric energy has to be supplied to the motors either from an 
 outside source or from its own central plant, it is but natural 
 that electricity be applied as far as possible for light and heat 
 as well as for power. 
 
 "An up-to-date farmer should possess his own electric gener- 
 ating station which may be operated by water, steam, gas, gaso- 
 line, oil or windmill power. 
 
 ' ' In many instances where a stream runs through the property 
 or the neighborhood of same, cheap power may be derived from 
 this natural source, as regards the first cost and operating ex- 
 penses. 
 
 "Generating current by steam power, the cost per killowatt 
 hour is comparatively high, yet by proper engineering skill, one
 
 UNDEVELOPED RESOURCES 275 
 
 horsepower may be obtained as low as one cent per hour. Prac- 
 tically the same results may be obtained with a gas producer 
 plant, in which case, instead of burning tlie coal in a steam boiler, 
 using the steam for driving the engine, the coal is slowly burned 
 in a producer, generating gas for operating the gas engine. 
 
 "Gasoline, oil and alcohol engines work on the same principle 
 as the gas engine, all of which are of the internal combustion 
 type. Great strides have been made in the last decade in this 
 type of engine, and to-day it operates with reliability and econ- 
 omy and requires but little attention. 
 
 "Another source of energj' for generation of electric current 
 for farm and country residences is the windmill. The early 
 Dutch windmills were built with sweeps from 50 to 100 feet in 
 diameter; our modern American windmills have sweeps from 12 
 to 18 feet, and generate more power than the early Dutch mills, 
 with less attention, etc. 
 
 "All the prime movers can be connected to electric generators 
 by belt, gearing or couplings, and the control of same by modern 
 engineering skill can be accomplished automatically so that little 
 attention is required. 
 
 "As the greatest amount of energy is used in the day time, 
 while the load for illumination is small and principally comes in 
 the evening, it would therefore be an impracticable propos- 
 ition to run the prime movers at that time. The use of a storage 
 battery is consequently of the greatest service, supplying energy 
 at any time of the day or night. In connection with the storage 
 battery and with the new development of the low voltage Tung- 
 sten lamps, the cost and size as well as the maintenance expense 
 may be considerably reduced by proper engineering. 
 
 "The main feature, and in which the great advantage of an 
 electrically operated farm lies, is, that the farmer himself has at 
 all times under his direct control the entire supply of electric 
 energy being used, which may be obtained from some public ser- 
 vice corporation at from 5 to 10 cents per kilowatt hour, or better 
 still, the energy may be supplied from his own private generating 
 plant at cost varying from 1 cent per kilow^att hour and upward. 
 
 "A policy much adopted abroad is to install a rural central 
 station for the purpose of supplying a number of farms, niral 
 industries, country residence and estates with electric current. 
 By establishing a rural central station, either steam, water, gaso- 
 line, oil or gas, a great saving in the production of electric energy 
 may be secured. To-day we find in Geraiany as many as 100 to
 
 276 THE PRICE OF INEFFICIENCY 
 
 150 consumers being supplied with electric energy from one of 
 the numerous rural central stations. 
 
 "Many of the German farmers have connected with their 
 farms, rural industries whereby they utilize their by-products 
 and herein lies the secret of success of many well-to-do farmers. 
 For instance, in the last mentioned central station system, there 
 are connected four grist mills, with five motors, having a total 
 capacity of 105 horse power ; one tile works with a 40 horse power 
 motor; one saw mill with a 20 horse power motor, four wheel- 
 wrights have motors amounting to 16 horse power; and in con- 
 nection with same, using motors of varying capacities, are other 
 industries, such as cabinet making, distilling, blaeksmithing, bot- 
 tling works, etc. There are also connected with the system some 
 20 consumers for light only, having a total of 343 incandescent 
 lamps and 5 arc lamps, one railway and freight station with 120 
 incandescent lamps; one club house with 72 lamps and 6 arc 
 lights, and further two towns are supplied, having a total of 
 1,692 lamps. 
 
 ' ' From the above facts and figures, it is obvious that electricity 
 can give a new stimulus to agriculture and farming, and at the 
 same time opening up a new way by which the rural population 
 can be induced to remain on the farm instead of flocking to the 
 cities, and being forced to take an entirely new branch of service 
 in order to earn a living. 
 
 ' ' A very decided feature is that a few motors properly selected 
 can operate all of the machines on the farm, instead of having a 
 steam or gasoline prime mover attached to each machine. It is 
 just in this feature that lies a great advantage of electrically 
 operated farm machinery. Take, for instance, a motor placed on 
 a low four wheeled truck, and brought to the threshing machine 
 and connected by means of a belt ; the motor is connected to the 
 electric supply mains by a flexible cable plugged into a suitable 
 outlet. By throwing a switch, the motor starts and operates con- 
 tinuously without attention. After the threshing is completed, 
 the motor may then be connected to the baling machine, which 
 packs the straw into bales, and if necessary the motor can be used 
 for loading the bales onto wagons by operating a hoist. At other 
 times, the same motor drives the water pump, wood saw, etc. 
 
 "It is readily seen that the electric motor can operate without 
 the attention necessary for steam or gasoline prime movers, which 
 have to be supplied with water, coal and gasoline as the case may 
 be. With all other prime movers, when placed in the barn or
 
 UNDEVELOPED RESOURCES 277 
 
 hay mow, or beside the stack in the field, the fire risks are a 
 thousand fokl greater than with an electric motor in the same 
 place, in fact an enclosed electric motor can be placed anywhere 
 on the farm without fire risk or fear of an explosion. 
 
 "The motors used on dairy appliances and for the various 
 household operations are of such small size and weight, that they 
 are easily carried around by one or two persons, and applied to 
 one machine or another wherever needed; thus many farms can 
 get along with one large and one small motor. As the various 
 farm machines operate at different speeds, the motors are sup- 
 plied with suitable regulating devices, so that the desired speeds 
 may be obtained. 
 
 "The great advantage of cold storage is not properly recog- 
 nized to-day by farmers. By means of electrically operated cold 
 storage systems, butter, milk, eggs and other perishable goods 
 may be saved from spoiling. In many cases, especially with 
 fruit, a farmer is forced to let his fruit lie on the ground and 
 rot, because the price offered does not pay him the expense of 
 picking, packing and shipping his goods to the commission mer- 
 chant. A cold storage system would enable him to pick his fruit 
 in the proper season when the market price is low, and store it 
 until he receives his ovm price. 
 
 "Ice machines for refrigerating plants, in this case, are pref- 
 erably electrically operated, and the motor applied to the equip- 
 ment will start and stop automatically, and will keep the tem- 
 perature in the cold storage room within a few degrees, up and 
 down, of the desired temperature. 
 
 "For irrigation purposes, electric pumps are of great service, 
 whether on large or small scale. As these pumps operate only 
 in certain seasons of the year, and certain hours of the day, pub- 
 lic service corporations have recognized of late that the pumps 
 for irrigation purposes assist in giving a good load factor on the 
 station and consequently offer energy for this purpose at excep- 
 tionally low rates. The motor-driven pumps may be stationaiy 
 or portable. 
 
 "Large sums are yearly spent for irrigation purposes and 
 waterways regulation and drainage systems, and seemingly in 
 almost all cases, without due consideration, of utilization of the 
 energy of the water for generating electric current which might 
 be advantageously used for farming or rural industries. Good 
 examples on a large scale of such combination systems will be 
 found in Switzerland and particularly in Germany, where all
 
 278 THE PRICE OF INEFFICIENCY 
 
 kinds of advantages are taken of natural resources, and proper 
 husbanding of same for the benefit of the public in general. 
 
 "Electric plowing has been carried on in Germany for some 
 15 years, and particularly^ in the last few years, great strides have 
 been made. Of the several systems employed, the one and two 
 motor systems are most extensively used. Both systems are car- 
 ried out in the same way, that is, a cable on a drum pulls the 
 plow across the field. 
 
 "Electric plowing has great advantages over the gasoline or 
 steam engine plow system ; for instance in the latter case, a great 
 amount of coal and water must be brought to the field by numer- 
 ous teams and drivers which must be held in readiness. Electric 
 plowing can be carried on in practically every kind of weather, 
 for instance, steam operated plows may freeze in cold weather, 
 whereas the electric plow is not affected by the cold, and the 
 latter can also be used in soft or loamy soil where horses cannot 
 work and in hilly ground. 
 
 "As far as the cost of electric plowing is concerned, experience 
 shows that it can be done cheaper per acre than horse or steam 
 plowing. The field of electric plowing of to-day is found prin- 
 cipally in Germany. It is an established fact that American 
 agricultural machinerj^ in its wide practical application is in 
 most respects far superior to that of any foreign make, and 
 should the domestic manufacturers devote themselves with the 
 same skill to electric plowing, it would be a question of only a 
 short time when our farmers would recognize the advantages of 
 the system. 
 
 "The practical application of electric plowing is not confined 
 to farms of large acreage, it can be carried on to good advantage 
 on farms of small size, and a number of farmers may have but 
 one plow in common, to do the work of the different farms, or 
 the plow may be rented out. 
 
 "The idea of utilizing farm refuse for by-products must not 
 be discarded without close study and consideration; it must be 
 borne in mind that our modern industries make use of all possi- 
 ble substances for by-products. In thousands of cases, it has 
 turned out that the by-product has proved more valuable than 
 the original and practice has always shown that this applies pro- 
 portionately to rural industries and the farm as well as to manu- 
 factures. 
 
 ' ' ]\Iany of the by-products of the farm which now are allowed 
 to go to waste, could be turned to good account by the use of
 
 UNDEVELOPED RESOURCES 279 
 
 electrically operated apparatus, especially designed to turn by- 
 products into marketable goods. 
 
 "Nearly all fruit is rich in sugar, varymg in contents from 10 
 to 5% ; of the common fruits, the grape yields the largest per- 
 centage of sugar. The normal -svine-grape contains from 16% 
 to 30% ydth an average of 20%. The two most important plants 
 for yielding sugar are the sugar cane and the sugar beet. For 
 instance, the Louisiana sugar cane contains 19% to 40% of sugar 
 while sugar beets contain from 12 7o to 18% of sugar. Sorghum 
 contains, in the staff at the time the seed is matured and the 
 starch hardened, from 9% to 15% of sugar, according to the re- 
 port of the United States Department of Agriculture. 
 
 "In packing fruit for the market, such as apples, grapes, etc., 
 only sound fruit is selected; that which is in any way bruised 
 or in the first stages of decay is thrown out. Instead of allowing 
 this refuse to go to waste, it can, by the use of electrically oper- 
 ated presses, or stills, be turned into cider or grape juice. The 
 pumice which remains can be used as a fertilizer for the soil. 
 The amount of electric energy needed to operate the machinery 
 necessary for such purposes is much less than five horse power. 
 One of the portable outfits used for various purposes can take 
 care of these outfits during the time that it is in operation. 
 
 "Farm products from which starch may be obtained as a by- 
 product are the potato and cassava; the American potato con- 
 tains 15% to 207o of starch, which in turn may be converted into 
 alcohol. In many instances, potatoes are accidentally frozen by 
 exposure to severe frosts, or are sometimes frozen in storage. In 
 Europe, potatoes in such condition have still some value, yield- 
 ing a considerable percentage of alcohol of high strength. This 
 practice of converting frozen potatoes into alcohol is a common 
 practice in Germany. 
 
 "In recent German reports, in bringing out facts on electric- 
 ally operated farms, it is shown that since the government has 
 taken an active interest in the matter, a number of plants have 
 been installed for drying the leaves of the potato and the beet, 
 to be used as food for cattle, because they are so high in protein 
 or fat producing elements. Germany used to buy $8,000,000 
 worth of cattle food from foreign countries. The records show 
 that there are yearly 24,000,000 tons of green leaves for drj-ing, 
 giving about 6,000,000 tons of preser^^ed good food stuff, of a 
 value of nearly $12,000,000." 
 
 "In 1901, when the potato crop of Germany was 53,682,010
 
 280 THE PRICE OF INEFFICIENCY 
 
 short tons, efforts were made to discover practical and economical 
 methods for preserving the potatoes, so that the surplus could be 
 preserved and used for supplying subsequent demands, without 
 the loss due to storing potatoes in silos or bins. When put into 
 bins for storage, their value shrinks 10%, which would mean a 
 total loss of $25,000,000. At present there are 436 plants estab- 
 lished in Germany for drying potatoes, with an estimated pro- 
 duction annually of 110,230 to 165,345 short tons, or 3,674,000 
 to 5,511,500 bushels. 
 
 ' ' The process of preserving potatoes is washing, drying, peeling 
 and cutting and again drying, and the product is finally placed 
 on the market in the form of potato flakes. The prices vary from 
 1^ to If cents per pound. 
 
 "A large part of the German potato yield is converted into 
 the so-called potato flour, and sold at retail in the groceries 
 throughout Europe for cooking purposes. There is also a flour 
 produced by grinding and bolting dried potatoes, but this, how- 
 ever, is a comparatively new product. 
 
 "There are many vegetables and plants grown on the farm 
 which can be converted into one form of by-product or another, 
 especially for the manufacture of alcohol. There is over 20% 
 of starch in the South Carolina sweet potato and as high as 2,600 
 pounds of starch per acre have been produced. 
 
 "The average yield of sweet potatoes per acre is, of course, 
 much less than in the above cited South Carolina case, where 
 heavy fertilization was employed. On plots to which fertilizer 
 was not added, the yield was about 8,000 pounds of sweet potatoes 
 per acre, yielding in round numbers about 1,900 pounds of starch. 
 The quantity of sugar in the 8,000 pounds is about 350 pounds, 
 which makes about 1,250 pounds of fermentable matter. This 
 can be turned into industrial alcohol yielding about 160 gallons 
 of 95% proof. 
 
 ' ' The need for an efficient lighting system is well recognized as 
 being of equal importance for the country as well as for the city. 
 It will assist in fixing hours of labor as they are in the city, which 
 is necessary to satisfy the just demands of the farm hands, as 
 well as others living in the country. In consequence of better 
 light, greater efficiency and cleanliness are secured all around, 
 fire risks are diminished and insurance rates are reduced. Elec- 
 tric lamps require no matches and burn without flame and con- 
 suming no oxygen do not vitiate the air of the room. Electric 
 lighting is of particularly great service in stables and bams,
 
 UNDEVELOPED RESOURCES 281 
 
 where the use of lanterns has caused numerous fires and destroyed 
 millions of dollars worth of property. Electric lights are turned 
 on and off by a suitable switch located at any convenient point 
 and are unaffected by any change in weather conditions. 
 
 "Another great advantage in using electric illumination is that 
 similar to the street, the yard and field may be lighted and con- 
 trolled from the residence. This feature is especially conven- 
 ient when in the fall of the year, harvesting is necessarily carried 
 on after dusk, in order to ward off any changes due to weather 
 conditions. In such eases, the field under the harvesters can be 
 illuminated to advantage and work continued long after night- 
 faU. 
 
 "Electricity is a ready servant for cooking or heating. No 
 heat is wasted as in a coal or Avood stove ; all heat is concentrated 
 in the one piece of apparatus being used. The cost of operating 
 a small electric range is in almost all cases cheaper than burning 
 wood or coal. In many instances, electric current can be bought 
 for 5 cents per kilowatt hour, and as the average price of gas 
 throughout the country is $1.50 per thousand cubic feet, the 
 cost of electric cooking is the same as that done by a gas range, 
 provided there is no heat wasted on a gas range, which is hardly 
 avoidable. This is not taking into account that when one has 
 his OMTi generating set, current can be generated for 1 or 2 cents 
 per kilowatt hour. Further it must be borne in mind that elec- 
 tric cooking means perfect cleanliness. There is no soot or smoke 
 and as far as convenience is concerned, all that is necessary is to 
 turn a switch. 
 
 ' ' In country residences, where during certain hours of the day 
 little cooking is carried on, such as making coffee, boiling eggs, 
 preparing toast or supplying heat to chafing dishes, all is done 
 in a few minutes, right before your eyes on the dining table itself. 
 
 "The heating of flatirons by means of electricity has proven 
 one of the greatest boons to the household. The electric flatiron 
 is so constructed that the current is supplied to the iron during 
 use, and it maintains its working temperature, does not overheat 
 and accidentally scorch the work, and is kept ready for work 
 at a minimum cost. As no stove is necessary, there is no con- 
 stant change of irons, also no intense radiation of heat into the 
 room to make the operation more tiresome, and in the summer 
 particularly trying. 
 
 "Other electric heating appliances for household convenience 
 are electrically operated facial and scalp massage apparatus,
 
 282 THE PRICE OF INEFFICIENCY 
 
 foot warmers, heating pads and bed warmers, radiators, etc. 
 Many of them are conveniently applied to country hospitals and 
 sick rooms; among the appliances especially made for hospital 
 use are sterilizers. X-ray apparatus, cauterizers, electric 
 blankets, ozonizers, etc. 
 
 "These by no means comprise the entire list of necessary and 
 convenient appliances which can be found to-day. New devices 
 are appearing every day, so that at the present time there is 
 hardly a household or farm where electric energy through the 
 skill of the engineer could not supplant many of the most la- 
 borious operations. 
 
 ''At the present time, fully 90% of all skilled labor comes 
 under the supervision of the engineer, who has taken ad- 
 vantage of the various kinds of natural resources, and has built 
 up the great industries which we have to-day. Our nearly seven 
 million farmers in the United States should in a similar way 
 take advantage of the engineer, who is especially capable in the 
 art of development and husbanding of the natural resources 
 through the medium of electric energy, for our agrarian indus- 
 tries, upon which not only financial standing is dependent, but 
 the general welfare of the country as a whole." 
 
 The technical man in Germany has done wonders for agricul- 
 ture. By the development of fertilizers Germany averages 31^ 
 bushels of wheat per acre to 13 in America, rye 29 to 16, oats 
 51 to 25, and potatoes 158 to 83. If American farmers should 
 increase their yields to the German averages, it would mean a 
 gross output of products which could not be raised under pres- 
 ent methods on a country twice as large as ours. 
 
 Yet Germany was formerly but little if any in advance of 
 America, and these yields are made on soils in use for centuries 
 before America was discovered. The scientific selection of seed 
 and use of fertilizer has told the story. Two thousand, six hun- 
 dred and fifty pounds of potash salts and manure are used per 
 acre in Germany on cultivated lands while but 311 pounds are 
 used in the United States. The German farmer practically uses 
 his land as mechanism for transforming fertilizer into products, 
 while the American scrapes and scratches along trying to get 
 products out of his land without feeding any raw material what- 
 ever into it.
 
 CHAPTER XVIII 
 THE PROBLEM OF IMMIGRATION 
 
 The fundamental chanj^e in recent immigration — Floating immigration 
 and its financial effects — America as an apple orchard — The respon- 
 sibility of the Anuerican of to-day to the American of the future — 
 The Iberic and Slavonic menace — Lowering the level of American pros- 
 perity — ^The sullen negro — Orientalism — The flood of yellow blood at 
 our western gates — Governmental inefficiency in congested immigra- 
 tion — American emigration, a new phenomena — The movement to the 
 Canadian northwest — The ebb and flood of immigration. 
 
 The most vital and important problem of the United States 
 is and has long been immigration. To what extent it should 
 be cheeked, if at all, the question of the varying races and the 
 ultimate effect on the standard of living and character of the 
 nation which will result from unregulated immigration need 
 long consideration. 
 
 Immigration in principle needs no discussion. Without im- 
 migi-ation, America would still be a wilderness tracked by a 
 few savages. But if the whole world crowded here, we should 
 have all the problems that they have and others in addition. 
 There is thus a happy medium to be achieved. 
 
 In the first two or three centuries, immigration was not im- 
 migration in the present sense, but pioneering, and the early 
 settlers came to make their homes in the \^■ilderness. During 
 the middle of the last century, the immigrants still came largely 
 as settlers, in the spirit of pioneering, but towards the latter part 
 of the century and at the present time, immigration has taken 
 on a new character and while a considerable portion of it is 
 comprised of intending settlers, it contains a large proportion 
 of what may be tenned floating labor, a current of workmen 
 drawn by higher wages; to return to their own countries with 
 the surplus they have obtained when conditions render their 
 employment here less lucrative. 
 
 Another feature of immigration at the present time which is 
 of grave concern is the fact that the bulk of it is of Iberic and 
 Slavonic character, an entirely different blood from the Teu- 
 
 283
 
 284 THE PRICE OF INEFFICIENCY 
 
 tonic, Celtic and Anglo-Saxon which constituted the principal 
 part of the immigration up to a generation ago, and which 
 blended readily with the native population. 
 
 This vast influx, a million a year, of races of a different char- 
 acter, and almost without exception of examples of such races 
 drawn from the lowest orders, if it continues, will transform 
 the race. The American of the third century of the republic 
 will be a different person from the American of the first and 
 second centuries of the republic ; in fact he will be a new amal- 
 gam, not before produced in the melting pot of the world, for 
 not alone will he be of mixed blood, but the effect of the climate, 
 soil and latitude of North America, will produce a race never 
 before known. 
 
 It is within the power of the American people of to-day to 
 decide the complection of this future race which will be their 
 inheritors, and whether the Iberic and Slavonic elements are to 
 influence it in the proportion indicated by the present vast flood 
 of immigration. 
 
 Whether this proportion will continue is doubtful. It would 
 appear that the United States, so full of possibilities, has actu- 
 ally drained Western Europe of the available supply of immi- 
 grants. A condition of eqviilibrium exists between the de- 
 mands of America and the demands of the home countries. 
 England sends us few immigrants and fewer of them take out 
 naturalization papers. The immigration from Germany is less 
 than a tenth of w^hat it was formerly, while Ireland has few to 
 send. 
 
 In a reasonable length of time the southern and eastern 
 European countries may also be drained and immigration may 
 cease as compared with its present volume. 
 
 What this signifies is pointed out by Henry P. Fairchild of 
 Yale University, in a communication to the New- York Times, 
 October 14, 1911 : 
 
 ''If it is true that from now on the stream of immigration 
 to this country is to be a diminishing one, irrespective of any 
 increased stringency in the matter of selection and admission, 
 it can mean only one thing — that the United States no longer 
 enjoys such a position of economic, social and political super- 
 iority to the other nations of the world as to make it worth 
 while for foreigners to take the trouble to come here. Gen. 
 Francis A. Walker long ago said that immigration of the 
 lowest class 'will not be permanently stopped so long as any
 
 THE PROBLEM OF IMMIGRATION 285 
 
 difference of economic level exists between our population and 
 that of the most degraded communities abroad.' Modern au- 
 thorities agree that the volume of immigration responds 
 directly to the conditions of economic prosperity in this coun- 
 try. 
 
 "At the beginning of its National life, the United States 
 enjoyed such natural advantages as made it worth while for 
 the citizens of the most advanced of the older nations to try 
 their lot in the new world. Many of these advantages are 
 already gone, and as stated in your article, the better class of 
 immigrants are now seeking other lands. Argentina gets the 
 North Italians while the South Italians come to us. Canada, 
 w^hile encouraging and soliciting immigration from Northern 
 and Western Europe, discriminates frankly and effectively 
 against natives of the southern and eastern portions of that con- 
 tinent. In our own. case, the so-called 'new' immigration 
 vastly outnumbers the 'old.' And there are still plenty to 
 come. Barring any further legal restrictions, they will con- 
 tinue to come from ever lower and lower sources until con- 
 ditions in the United States so closely resemble those in the 
 most unfortunate foreign countries that it is no longer worth 
 while to make the effort. ' ' 
 
 One of the most ominous problems of America to-day, but 
 one which from long familiarity has made itself to a large 
 extent an unrealized problem, is the result of a form of immi- 
 gration in the past. It is the problem of the negi'o, who was 
 compelled to enter. Those who do not understand the negro 
 problem, wonder at the violence it arouses. 
 
 If left to solve itself, the negro problem would be settled by 
 a gradual absorption of the race into the white race, and the 
 result would be a contamination of the whites, until America 
 would be a negroid country, its racial purity forever lost. 
 The most vigorous restrictions are therefore necessary to pre- 
 vent intermarriage of blacks and whites. Similarly the first 
 view of the Chinese problem is that their cheap labor would 
 develop the country. Nevertheless the hordes of Chinese that 
 would be attracted would form a condition far worse than the 
 negroes, who are not too numerous to be controlled. The in- 
 fusion of Chinese blood that would result through the peculiar 
 attraction of white women for the Chinese, would in a few gen- 
 erations produce a mongolianized Caucasian, a mysterious, 
 possibly defective and certainly inferior race, which would in
 
 286 THE PEICE OF INEFFICIENCY 
 
 time be totally submerged by the increasing influx of Chinese, 
 until America would become a Chinese country with the Mon- 
 golians slightly caucasianized. 
 
 To a lesser degree the immigration of all races having oriental 
 characteristics is charged with a similar danger. 
 
 Against such a possibility, the policy of the United States 
 has been definitely settled. Chinese exclusion is a policy more 
 immutable than most of the provisions of the constitution 
 itself. 
 
 That the United States needs immigrants of the proper char- 
 acter, however, is beyond question. There are only 38 persons 
 per square mile in the country as against 359 in Great Britain, 
 290 in Germany and 629 in Belgium, and while the latter coun- 
 tries have more than they should have, that is a population 
 which is so numerous that they could not gain a livelihood from 
 that portion of the earth's surface on which they reside did 
 they not draw supplies from elsewhere, the sparse population 
 of the United States makes it certain that for many years we 
 shall have a place for all the desirable immigrants that may 
 wish to come. 
 
 The real problem of immigration at the present time is one 
 that has been created by governmental inefficiency, that is the 
 lack of proper means of distribution of the immigration. "With 
 an appalling lack of foresight, the government has allowed the 
 immigrants, particularly during the last ten or twenty years, 
 to accumulate in the big cities along the eastern seaboard. 
 These cities are made cosmopolitan in character and thus differ 
 from the normal American cities. Conditions of over crowd- 
 ing arise and other evils of congestion of population, while the 
 demand for labor in other places remains unsatisfied. 
 
 Governmental inefficiency extends also to the manner in 
 which the immigrant is treated during the process of distribu- 
 tion. The alien arriving in the land of freedom too often finds 
 that freedom means for practical purposes, a license to private 
 bankers, notaries public, lav^^yers, collection agents, insurance 
 companies, real estate agents, employment agents, benevolent so- 
 cieties and naturalization clubs, to cheat and rob him. The first 
 annual report of the Bureau of Industries and Immigration of 
 the New York State Department of Labor, states that: in the 
 matter of transportation the combination of steamship agents, 
 emigrant hotels, runners, porters, expressmen and cabmen 
 throughout the country, operating chiefly through New York
 
 THE PROBLEM OF IMMIGRATION 287 
 
 City, forms one of the most stupendous systems for fleecing the 
 aliens, from the time he leaves his home country until he 
 reaches his destination in America, and vice versa. 
 The report says: 
 
 "In labor camps aliens are discriminated against in regard 
 to housing, sanitation, food supplies, and employment methods, 
 being denied the ordinary decencies of life; aliens are checked 
 and tagged, amounts ordered by the padroni are deducted from 
 their wages without their knowledge or express sanction, and 
 exploitations occur in hospital charges and the purchase of sup- 
 plies. 
 
 "The private banking laws are affording only a small meas- 
 ure of protection owing to evasions of the law, and no protec- 
 tion whatsoever outside of cities of the first class; frauds in 
 the sale of homes to aliens by means of the solving of puzzles 
 or by means of excursions arranged to interest aliens in 'show' 
 pieces of property, or by other means, are widespread and the 
 settlement of affairs in the old country, when an alien wishes 
 to settle here, is in the hands of a most unscrupulous class of 
 lawyers, notaries public, collection agents, information bureaus, 
 and protective leagues." 
 
 The report of the Commissioner General of Immigration 
 shows that the trend of immigration is now upward and is 
 rapidly increasing and reassuming the proportions which pre- 
 vailed prior to the fiscal year of 1908. During the past year, 
 the number of aliens coming as immigrants was 1,041,570. As 
 the later months of the year show a greater proportionate in- 
 crease than the earlier, it seems likely that the ensuing year 
 AA-ill witness a still nearer approach to the largest record so far 
 made,— that for the fiscal year 1907, viz. 1,285,349. 
 The report continues: 
 
 "Of particular interest with regard to the 1,041,570 immi- 
 grants entering the country (1910) are the following statistics: 
 Of these, 120,509 were under fourteen years of age, 868,310 
 were between the ages of 14 and 44 and 52,751 were 45 or over. 
 As to literacy, 253,569 could neither read nor write and 4,571 
 could read but not write. These figures include no aliens 
 under 14 years of age, which indicates a decrease in illit- 
 eracy from 29% of the total in 1909 to 28% of the total in 
 1910. In 1908 the ratio was 26%; in 1907, 30% and in 1906, 
 
 28%. 
 
 "The total amount of money brought to the country by ar-
 
 288 THE PRICE OF INEFFICIENCY 
 
 riving aliens calculated on the not altogether reliable basis of 
 amounts shown at time of arrival, was $28,187,745 or an aver- 
 age of about $27 a person. 
 
 ''During the fourteen months prior to September, 1912, the 
 1,114,989 aliens, — immigrants as well as aliens temperorarily 
 here — brought $46,712,697. The immigrants had an average 
 of $38 per capita in the fiscal year to July 1 and $40 per capita 
 during the two following months. 
 
 "There is no way, of course, to determine how much of this 
 consisted of money sent to the applicants by friends or rela- 
 tives living in the United States. Concerning payment of pas- 
 sage, 755,453 claimed to have bought their own tickets while 
 274,204 admitted that they had been assisted in this regard by 
 relatives and 11,913 that they had been so assisted by friends. 
 According to the statement of the aliens themselves, it there- 
 fore appears that over 25% of the total number admitted were 
 assisted to reach this country. 
 
 "It is still true that the bulk of our immigration is being 
 drawn from the countries of southern and eastern Europe, 
 Italy, Austria-Hungary, Greece, Turkey in Europe, and the 
 smaller principalities adjacent, and Russia supplied about 68% 
 of the immigrants admitted in 1910. In the year 1909, these 
 same countries furnished 67%. This is in marked contrast to 
 the immigration of former times. 
 
 "During the year, it was necessary to turn back at the ports, 
 24,270 aliens, or about 2% of the total number applying for 
 admission. The corresponding total and percentage! for the 
 year 1909 was 10,411, or 1.1%. 
 
 "During the year 202,436 aliens left the United States. 
 Concerning 34,043 of these, it has not been possible to secure a 
 record of the period during which they have lived here, as they 
 departed across the Canadian border. It appears that 13,841 
 were less than 14; 167,440 ranged from 14 to 44, and 21,255 
 were 45 years of age or over; while 136,159 had resided in the 
 United States less than 5 years; 23,969 from 5 to 10 years; 
 3,877 from 10 to 15 years; 2,310 from 15 to 20 years, and"^ 2,078 
 over 20 years. 
 
 "Of common unskilled laborers, 215,300 immigrated and 
 89,393 emigrated ; as compared with 138,570 members of the 
 skilled trades immigrating and 21,574 emigrating. These 
 should be compared further with the figures for the fiscal year 
 of 1909 as follows: Unskilled laborers, 174,800 immigrating
 
 THE PROBLEM OF IMMIGRATION 289 
 
 and 118,926 emigrating; and skilled laborers, 87,160 immigrat- 
 ing and 21,919 emigrating." 
 
 Emigration from the United States is large in volume but 
 mostly confined to the floating labor class, whose average exodus 
 is about 40% of the whole number of immigrants. Three- 
 quarters of them, after leaving America do not re-immigrate, 
 but one-fourth or 10% of the whole number come back again, 
 so that taking the figures for 1910, 1,041,570 immigrants, 30% 
 will sooner or later depart for good, while 10% have been here 
 before, so that the net increase is about 600,000. 
 
 The year in which the greatest exodus took place was 1907, 
 the year of the panic, when 711,000 returned. The panic being 
 one largely arising out of artificial conditions created by gov- 
 ernmental neglect, thus threw this number of men out of work 
 who were able to get away. What its loss was to the ones who 
 did not care to go, or could not emigrate and the native popu- 
 lation it is difficult to calculate. Wliat this vast army of labor- 
 ers who went back could have earned for themselves and for the 
 country had they been able to remain is also an enormous 
 figure. 
 
 Considering the value of a wage earner as $1,700, which is 
 the estimate of the National Conservation Commission and 
 estimating that of the 711,000 emigrants who returned in 1907, 
 500,000 were wage earners, the capital loss to the country by 
 their withdrawal amounts to some $850,000,000. 
 
 According to a special report of the Census Office, 1907, the 
 wealth of the nation in 1904, including the value of real prop- 
 erty, and everything having a commercial value, was $107,104,- 
 192,410 as has been given, or 200 times the wealth of a Rocke- 
 feller. In 1900 the value was $88,517,306,775, so tliat at the 
 present time it is probable that the wealth is not less than 125,- 
 000 millions. There are some 33,000,000 wage earners, and at 
 a calculation of $1,700, they amount to $56,100 millions, making 
 the total wealth of the country $181,000 millions. 
 
 Of the 1,000,000 immigrants annually coming in, not less 
 than 400,000 are wage earners, while half the remainder be- 
 comes wage earners. Their value would be $1,190,000,000 
 added to the capital of the country annually, and as they bring 
 not less than $28,000,000 in money with them, the total is 
 $1,218,000 millions, which is more than two thirds of 1% annually 
 of the' entire wealth of the country. This means, for example, 
 that the owner of real estate worth $10,000 finds on account of
 
 290 THE PRICE OF INEFFICIENCY 
 
 immigration that the value of his property is increased at the 
 end of a year to $10,067. 
 
 The emigration from the United States consists of those who 
 return after coming here, and a considerable flow of very valu- 
 able emigrants into the Canadian northwest. This amounts to 
 about 100,000 annually, mostly well-to-do farmers, and the 
 Canadian government estimates that they bring an average of 
 $1,000 each into the country. Assuming that two-thirds are 
 wage earners, the loss to the United States is $213,333,333 an- 
 nually, a particularly large drain owing to the high class of 
 the emigrants, in most cases farmers who have sold their farms 
 in America and who are going to Canada to take advantage 
 of the rich lands and better government there. 
 
 The average return of immigrants is about 200,000, a value 
 of $340,000,000, and as it is estimated that the total of money 
 which they take back with money sent home by other emigrants 
 amounts to $400,000,000, there is thus a loss of $740,000,000 
 from this cause. 
 
 Another loss to the country is in the emigrants of great 
 wealth, who permanently remove to foreign countries to reside 
 and who drain a constant income from America in addition to 
 large capital withdrawals. Among this class of emigrants are 
 the wealthy women who marry titled foreigners, and it is esti- 
 mjated that not less than $100,000,000 annually is withdrawn 
 through this channel. Including the exodus to Canada and the 
 general withdrawals, the country loses annually $1,053,333,333. 
 In addition are large sums spent by our temporary emigrants, 
 the tourists, for whose patronage an established and well or- 
 ganized propaganda is carried on in various foreign countries. 
 Without the immigrants with their inbringing of $1,218,000,000 
 the country would suffer a heavy loss from its wealthy 
 emigrants. 
 
 A tendency which is rapidly growing on the part of alien 
 nationalities and races and one which is open to serious crit- 
 icism is that of adopting anglicized patronymics or in^ many 
 cases names of purely anglo-saxon or eeltic origin. This sail- 
 ing under false colors tends to debase the old and dignified 
 stock of names and to conceal the origin and characteristics of 
 the wearers of the borrowed plumage. It is largely resorted to 
 for purposes of commercial and social advantages and conse- 
 quently is of disadvantage to those legitimately bearing the 
 original names.
 
 THE PROBLEM OP IMMIGRATION 291 
 
 It is a practice which should properly be frowned upon by 
 courts within whose province it is to permit changes of names 
 to be made. 
 
 In cases where the foreign name is unpronounceable or ridic- 
 ulous, it should be permissible to alter it only to the extent 
 necessary to make it useable, it being allowed to be in no case 
 so changed as to conceal its origin. 
 
 The changing of names by immigrants has been severely crit- 
 icized for legal reasons. The New York Times in an editorial 
 published December 15, 1912, states: 
 
 Immigrants who assume the historic names of New England- 
 ers, like Endicott, Lowell, Adams, Lawrence, or Peabody, are 
 not only flouting their own ancestry, in which they should have 
 pride, but they are making trouble for the courts. Chairman A. 
 T. Clearwater of the New York State Bar Association's Law 
 Reform Committee says : 
 
 "It is not so much the philological phase of the matter which 
 engages the attention of the bar, as it is the opportunities for 
 fraud, the confusion as to ancestry and descendants, the errors 
 and perplexities arising in the search for and authentication of 
 title to real estate, all of which seem to us grave enough to re- 
 quire legislative action." 
 
 Among the reasons which cause the immigrant to change his 
 name is the disappointment which he feels when he becomes 
 acquainted with conditions in this country and finds that the 
 glo^dng prospects which he had in expectation are so difficult 
 of realization. 
 
 America is, in the oratorical phrase, a country of unbounded 
 possibilities, but for the immigrant it proves rather a country 
 of will-o'-the-wisp opportunities. The immigrant with a little 
 money in his pocket finds it gone before he gets well located 
 and then begins the struggle for existence, a kind of a life in 
 a swamp of immediate necessities surrounded by rainbows of 
 opportunity wherever he turns. He remains, however, pretty 
 well stuck in the swamp and among the schemes of a certain 
 class of immigrant for changing his luck, is that of changing 
 his name, which is of course merely another will-o'-the-wisp 
 for all save a few of the more unscrupulous. 
 
 Many an immigrant finding America disappointing, is often 
 asked why he does not go back instead of remaining here and 
 bewailing his lot. The principal reason is that he seldom has 
 the price of a ticket in his pocket, or if he has, he prefers to
 
 292 THE PRICE OF INEFFICIENCY 
 
 put it into some scheme in the hope of making a large sum. 
 When it is lost, the same process is repeated as he acquires the 
 American habit of depending on some sudden turn of fortune 
 to lift him out of the rut. 
 
 Even should he be able to pay his fare back, he would have 
 to return to face his relatives and former friends with the ad- 
 mission of failure in America which would promptly be charged 
 against him and not against America. Even willing to endure 
 this, he would be compelled to start all over again in the old 
 country with its settled customs which are not adapted to get- 
 ting rich quick, and where he would be at a great disadvantage 
 on account of the spirit of speculation which he acquired in 
 America and which he would have no means of gratifying. 
 
 Thus the immigrant, however dissatisfied and however much 
 worse off than abroad, continues to stick to America in the hope 
 of the stroke that will some day make him independent if not 
 wealthy. 
 
 Even those who acquire a competency seldom return, as by 
 that time they are Americanized and prefer not to go back to 
 the more formal and restricted channels of European life. 
 And in addition, having made some money they are eager to 
 make a great deal more, an appetite which can never be ap- 
 peased. 
 
 Immigration is not a German problem, and it is constantly 
 decreasing in importance, since the number of those emigrating 
 is much less than formerly, owing to improved conditions, while 
 the number of immigrants is small. 
 
 According to Consul General T. St. John Gaffney, of Dres- 
 den in the Daily Consular and Trade Report, Oct. 2, 1911, 
 there were 588,354 foreign workmen employed in Germany last 
 year. Of this number, 350,000 were engaged in farming. 
 There were 323,326 Poles, 82,092 Luthenians, 23,209 Hungar- 
 ians and 39,672 Russians and Austrians. 
 
 The negro problem, too, is not a German problem, as there 
 are but one or two in each city, usually bar tenders in American 
 style bars, or servants; and so little is race prejudice un- 
 derstood that they associate freely with white people. Indeed, 
 the negro in Germany is looked upon as a very good fellow, 
 and held somewhat in the regard that an Indian is by the 
 American small boy.
 
 CHAPTER XIX 
 THE RIGHT TO WORK 
 
 The duty and policy of the state — Bismarck's stand — Old age pensions — 
 Government employment a reserve — How Germany eases the struggle 
 for existence — The citizen as an asset of the state — From the cradle 
 to the grave — Great clearing house of labor — Effect of governmental 
 employment — Precedence given to married men — The inevitable nature 
 of the prevailing rate of wages — Unemployment funds — Lack of sys- 
 tem in the United States — The peculiar methods of the government 
 to get enlistments — The bright future of the soldier as seen on the 
 lithograph — Why 50,000 men deserted in ten years — The German 
 army as an educational institution — The high spirit of patriotism in 
 Germany — Discipline as a moral asset — The government sees to it 
 that the individual learns a means of livelihood — Haphazard methods 
 of the United States — If the Declaration of Independence were written 
 to-day, how would it read? — Absorption of wealth by owners of ma- 
 chinery — Women at work in the United States — Startling facts of 
 child labor — Hard conditions in the steel mills — ^The right to work 
 no more than the right to exist — The Carnegie and Rockefeller bene- 
 factions — Their true economic significance — Are they a burden in- 
 stead of a blessing? — The history of over production of philanthropy 
 in the past — Failure of attempts to obtain more than the prevailing 
 rate of wages — Why $5 a day bricklayers only make $11 a week. 
 
 Bismarck proclaimed the doctrine of the right to work as an 
 integral part of the policy of the German state: 
 
 "Give the workingman work as long as he is healthy, assure 
 him care when he is sick, insure him maintenance when he is 
 old. Was not the right to work openly proclaimed at the time 
 of the publication of the common law? Is it not established 
 in all our social arrangements, that the man who comes before 
 his fellow citizens and says, 'I am healthy, I desire to work, but 
 can find no work,' is entitled to say also, 'Give me work,' and 
 that the state is bound to give him work." 
 
 "But large public works would be necessary," exclaimed an 
 opponent. 
 
 "Of course," replied Bismarck. "Let them be undertaken, 
 why not? It is the state's duty." 
 
 The fundamental law supplemented by the Stein-Hardenberg 
 
 293
 
 294 THE PRICE OF INEFFICIENCY 
 
 legislation of the second decade of the last century was the 
 foundation on which Bismarck stood, when his policy was out- 
 lined in 1884. Carried out with the full approval of the old 
 Emperor, and by conservative majorities in the Prussian legis- 
 lature and the imperial parliament, this policy has had a funda- 
 mental part in the development of unified Germany. Social 
 insurance, industrial pensions, governmental regulation of 
 monopolies, the bureaucratic system in keeping politics out of 
 business and business out of politics, her educational system, 
 and the Bismarckian policy towards labor have proved the 
 cornerstones of German progress. 
 
 The policy has not been unaccompanied, however, with strong 
 opposition, and the various systems of the intervention of the 
 state in the relations of the employer and employee are open 
 to certain attacks. The social economist argues that state pro- 
 vision of employment, pensions, compulsory insurance and other 
 forms of state aid, are a tax on the thrifty for the benefit of 
 the unfit, thus interfering with the working out of the law of 
 the survival of the fittest, and undermining thrift and economy 
 in all by reason of the prospect of being cared for by the state 
 in old age or sickness. 
 
 The scheme thus tends to weaken the race as a whole. Yet 
 despite theories of this kind, the working out of the German 
 policies proceeds with generally good results. While it may 
 be urged that pensions for the aged encourage extravagance in 
 the youth, yet such pensions serve to lift a weight of anxiety 
 from numberless lives, enabling the task in hand to be per- 
 formed with greater care and skill, than if tinctured so much 
 with the American anxiety that tim;e is money. 
 
 While poverty is abundant in Germany, the violent contrasts 
 of pauperism is not as noticeable as in the United States and 
 England, where the fear of poverty, the hope of gain, and the 
 absence of any succor in time of necessity save that provided 
 or obtained by the worker himself are the sharp prods to en- 
 courage thrift. 
 
 One of the concrete proofs of the success of the present Ger- 
 man system, lies in the decrease of German immigration to the 
 United States. It is now only about one-tenth the figure of 
 former years. 
 
 The right to work in Germany, the employment by the gov- 
 ernment of men who cannot find employment elsewhere has 
 not proved a social institution of much currency. Like a gov-
 
 THE RIGHT TO WORK 295 
 
 ernmental gold reserve, it remains unused but of great potential 
 possibilities. 
 
 The government has not actually had to provide work to any- 
 great extent, that is Notarbeit (necessity work), but its readi- 
 ness to do so can always be relied upon. 
 
 Frederic C. Howe in the Outlook of May, 1910, in "How 
 Germany Cares for her Working People," states: 
 
 "Germany is not burdened with the economic philosophy 
 which America inherited from England. Germany does not 
 look upon the state as an unmixed evil. Germany does not 
 apotheosize the names of Adam Smith and Ricardo; she does 
 not believe in unlicensed individualism; she does not permit 
 the struggle for existence to weed out the so-called weak and in- 
 competent. Germany recognizes that modern industry has 
 made those who labor, dependent upon other causes than their 
 own thrift or willingness to work; they are not incompetent 
 and unfit because they have no job. Germany has secured in- 
 dustrial efficiency 'by the social legislation of the state.' 
 
 "From the cradle to the grave, the state has its finger on 
 the pulse of the citizen. His education, his health, and his 
 working efficiency are all a matter of constant concern. The 
 worker is carefully protected in his person from accident, he 
 is trained in his hand and his brain to be a good producer, and 
 he is insured against accident, sickness and old age. When 
 idle through no fault of his own, work is frequently found for 
 him. Wlien homeless, a lodging is offered so that he will not 
 pass to the vagrant class. Wlien sick, he is cared for in won- 
 derful convalescent homes, tuberculosis hospitals and farm col- 
 onies. When old age removes him from the mill or the factory, 
 a pension awaits him, a slight mark of appreciation from so- 
 ciety, which has taken in labor all that his life had to give and 
 left him nothing more than a bare subsistence wage.'' 
 
 Germany provides a very efficient system of finding work. 
 The municipal labor registries are a remarkable institution 
 which should be duplicated in America. ]\Ir. Howe, in the 
 same article, describes them: 
 
 "There are nearly 400 of the labor registries in the empire. 
 They find work for from 500,000 to 1,000,000 men and women 
 every year. They are maintained partly by the cities, partly 
 by private agencies. They are great clearing-houses for skilled 
 and unskilled labor of both sexes. I visited the registries in 
 Diisseldorf and Berlin. The latter is one of the largest and
 
 296 THE PRICE OF INEFFICIENCY 
 
 best in the Empire. It secured 120,000 positions in the year 
 1908. It was established in 1888 and is maintained by public 
 authorities at a cost of $25,000 a year, and is administered by 
 the Insurance Department. It occupies a splendid four-story 
 building, probably a hundred feet front, on Gormanstrasse. 
 It runs through to another street, the entrance on the latter 
 street being to the women's department. In the center of the 
 building is a great open hall capable of seating 1,400 persons. 
 There were probably 600 men waiting for work when I was 
 there. Here the men sit, grouped in sections, according to em- 
 ployment. When a call is received by mail or over the tele- 
 phone, the men are called to the desk. The wages and condi- 
 tions are explained and the men are given a card to the em- 
 ployer. Priority is given to the married men as well as to 
 those first registered. On one side of the hall is a buffet where 
 beer, cigars and food are sold at a trifling sum. There are 
 cobblers and tailors who do odd jobs of mending. A shower 
 bath can be obtained in the basement for a cent. There is a 
 smaller and more elaborate room for the skilled workers and 
 one for women workers in another portion of the building. 
 Connected with the registry is a free dispensary and medical 
 inspection bureau. 
 
 "These labor registries, scattered all over the Empire, are 
 being co-ordinated, so that the surplus labor of one market can 
 be shifted to another, while an attempt is being made to supply 
 the demland of the farmer for casual labor. 
 
 "Voluntary arbitration courts are usually found in connec- 
 tion with the registries. They are made up of employers and 
 employees, and are used for the settlement of minor trade and 
 wage disputes. With these are free legal aid dispensaries for 
 the aid of the working classes. 
 
 "Upwards of a dozen cities have opened up free house regis- 
 tries designed primarily for the working classes. House or 
 apartment owners report to the agency, giving details as to 
 location, rent, etc. An officer of the bureau then makes an in- 
 spection, and, if the house is approved, it is placed on the list. 
 In some towns the plan has found much favor, so much that all 
 other methods of renting by advertisement have been aban- 
 doned. This is a great boon to the workman, employed as he 
 is all day at his job. It saves him the time he can ill afford 
 to lose and enables him to find the sort of lodging he desires. 
 
 "None of these agencies creates work where no work exists.
 
 THE RIGHT TO WORK 297 
 
 Neitber the labor registry nor the Herbergen will open the door 
 of the factory' or meet the emergency of industrial depression. 
 They do not create opportunity; they merely attempt to find 
 a hole for the peg, or prevent the man from losing his grip on 
 himself during a period of waiting. Nor do they provide for 
 the mechanic who is brought face to face with starvation for 
 himself and his family, by reason of the closing of the factory. 
 
 "During the recent industrial depression in America the un- 
 employed petitioned the councils of many of our cities to open 
 up relief work. They did not want charity; they wanted work. 
 But the cities were powerless to relieve the situation, or had no 
 inclination to do so. Here, again, Germany recognizes that the 
 worker has a right to work ; that he has a right to expect some- 
 thing more than a visit from the charity organization society. 
 'Distress work' is very generally provided by the city. It is 
 usually limited to the winter months. The cities disclaim any 
 legal or moral responsibility in the matter. They do not recog- 
 nize the 'right to work.' But they provide work in consider- 
 able measure, nevertheless. They distribute ordinary work so 
 as to give the maximum of relief. They also require contrac- 
 tors to employ local men. Extraordinary conditions are met 
 to some extent by development work, such as excavations, street 
 paving, sewer construction, forestry, wood chopping and the 
 like. Applicants must be residents of the city and must be heads 
 of families. It is true that the work done is not of the best, 
 and it is more costly than that done through the regular chan- 
 nels, but it saves the self-respect of the worker and to some ex- 
 tent recognizes his right to work. In a larger sense, it saves 
 the community from the wreckage of vagabonds, tramps, and 
 semi-criminals who are the inevitable wastage of every period 
 of hard times. 
 
 "These are some of the means employed to prevent waste, 
 to keep the producing power of the nation at a maximum, and 
 to save the worker himself from the demoralizing influence of 
 irregular employment. They stop far short of a solution of 
 the industrial problem. The socialists have but little sympathy 
 "\nth these palliatives as in any sense remedial. But from the 
 point of view of the individual, the plan is far better than noth- 
 ing, although as a social programme it fails in this; it does 
 nothing to create more jobs. And there can be no very great 
 improvement in the well-being of the working classes until there 
 are more jobs than men seeking them."
 
 298 THE PRICE OF INEFFICIENCY 
 
 Mr. Howe is undoubtedly correct in his last statement. 
 There certainly can be no very great improvement in the well- 
 being of the working classes until there are more jobs than 
 those seeking them. Similiarly with farmers, who must con- 
 tinue their present ways until there are more farms than farm- 
 ers seeking them, while millionaires must remain restricted in 
 number until there are more millions lying about than there 
 are seekers for the same. 
 
 Mr. Howe does not indicate just where the superfluity of 
 jobs is to come from. Certainly not from the government. 
 Nothing is to be expected from "notarbeit" as the government 
 pays less than the prevailing rate of wages, which will not im- 
 prove the well-being of the working classes as a whole. If bet- 
 ter wages were paid, everyone would seek work with the gov- 
 ernment. 
 
 The system of state work, however, does well in times of 
 emergency and for individual cases. The rate of pay is very 
 little lower than the prevailing wage, as at too low a rate, ob- 
 jection would be raised ; similar to the objections made to convict- 
 made goods underselling the work of the honest man; and it 
 would be the objection of the competent against the undue com- 
 petition of the incompetent. Indeed the very narrow margin 
 under the prevailing wage, shows how little it is possible even 
 for a government to get away from the law of the survival of 
 the fittest, though actuated by the best of intentions. Those 
 loudest in proclaiming the right to work, raise the greatest out- 
 cry when it is given to someone else. But Germany is aiding 
 her workers as far as it is practicable to do so, which is one of 
 the secrets of her progress while other nations are doing little 
 or nothing at all. 
 
 No country has as yet actually introduced any insurance 
 against non-employment, but it is being urged in England 
 where the problem of the unemployed has been more pressing 
 for years than in any other country. 
 
 The Commissioner of Labor in his report states: 
 
 "Provision for unemployment by voluntary organizations 
 has followed the same general course of development as other 
 forms of insurance. With the gro^vth of the trade unions, it 
 was recognized at an early date that proper care of persons out 
 of work would be an efficient means of preventing such persons 
 from underbidding the prevailing rates of wages and thereby 
 would be an important means of maintaining an existing level.
 
 THE RIGHT TO WORK 299 
 
 The British trade unions in particular recognized the impor- 
 tance of this form of provision against unemployment; one hav- 
 ing instituted a svstem of out-of-work benefits as earlv as 1831, 
 and this provision -was subsequently adopted in otlier countries, 
 so that in all of the countries treated in the present study, such 
 relief was found to a greater or less extent. 
 
 "The forms in w^hich unemployment benefits are provided 
 consist of first, a pecuniary out-of-work benefit, usually granted 
 under many restrictions; second, a travel benefit, enabling the 
 workman to reach localities where there are opportunities for 
 employment; and third, a removal benefit, permitting the work- 
 man to make a permanent change in his place of residence. 
 Some of the trade unions, notably in Belgium and France, have 
 instituted workshops in which employment is provided for un- 
 emploj'ed members. 
 
 "In some institutions, as for instance, the friendly societies 
 of Great Britain, the unemployment benefit consists solely of 
 the remission of membership dues while the member is unable 
 to secure employment. 
 
 "Investigation of the subject of workmen's insurance has dis- 
 closed a variety of miscellaneous forms of aid in case of un- 
 employment, and among these may be mentioned the follow- 
 ing: 
 
 "Some of the British and Belgian societies providing relief 
 in case of sickness, death, etc., grant their members full rights 
 of membership without the payment of dues during involun- 
 tary unemployment. 
 
 "A number of business firms, especially in Germany, have 
 created unemployment funds for the workmen employed in 
 their establishments; membership in these funds is sometimes 
 compulsory and sometimes voluntary. Most of these organiza- 
 tions are rather systems of compulsory saving than systems of 
 insurance because most frequently the member is entitled only 
 to the amounts paid in by him, together with subsidies or vari- 
 ous forms provided by the establishment or by interest arising 
 from a special reserve fund. 
 
 "In Italy a privately endowed organization known as the 
 'IJmanitaris' of Milan grants subsidies on the Ghent system 
 to labor unions and other organizations providing unemploy- 
 ment funds. 
 
 "A number of associations of employers in Belgium, France 
 and Germany have collected assessments based on the number
 
 300 THE PRICE OF INEFFICIENCY 
 
 of their employees or on wages in order to institute a fund for 
 the relief of the unemployed workman. 
 
 ''One instance is known of a German establishment which 
 provides that when the workman is dismissed because of lack 
 of work, he becomes entitled to full wages or salary for a period 
 of time based on the length of service in the establishment. 
 
 "In Germany and France a small number of private com- 
 panies have undertaken to provide unemployment insurance as 
 a business undertaking. Although these firms issue collective 
 contracts, they cannot be properly classed as institutions of social 
 insurance. According to the information available, they have 
 not met with any great measure of success." 
 
 In the United States, neither the national, city or state gov- 
 ernments make any systematic efforts to relieve the unem- 
 ployed. Some cities have municipal lodging houses, where the 
 needy sojourner may earn a night's lodging by chopping some 
 kindling wood. Farm colonies appear in some places. Uncle 
 Sam's efforts at the relief of unemployment are chiefly con- 
 nected with providing places for an army of faithful postmas- 
 ters, but otherwise, he is engaged in deflecting from the ranks 
 of industry, a large supply of valuable workers to serve in the 
 army and navy. 
 
 The methods followed by the government amount practically 
 to a fraud on the man enlisting and the resentment which is 
 aroused is such that desertions reach an unprecedented number, 
 as will be seen. 
 
 Recruits are induced to enlist by means of booklets and 
 lithographs picturing the advantages of a military life. The 
 Baltimore Sun reprints matter of this kind which is typ- 
 ical of what is being used all over the country at recruiting 
 stations : 
 
 ' ' Uncle Sam says : 
 
 " 'Why shiver in Baltimore when you can spend the winter in 
 the balmy air and delightful climate of the West Indies? 
 
 ' ' ' Why feel hungry when you can get three good, square meals 
 a day from Uncle Sam? 
 
 " 'Why wear worn and ragged garments when Uncle Sam will 
 give you a complete outfit of clothes free? 
 
 " 'AVhy look for a job in which you have to spend all your 
 earnings for board, lodging, clothing and doctor's bills, with 
 no chance to have any fun or save anything for a 'rainy day'? 
 
 " 'A good job is looking for you. The United States navy is
 
 THE RIGHT TO WORK 301 
 
 looking for ambitious young men who are anxious to see the 
 world and earn advancement. 
 
 " 'Is it not worth considering?' " 
 
 The bright side is further presented by a well written book- 
 let, many of whose paragraphs would do justice to a get- rich- 
 quick promoter. 
 
 ' ' There is a fascination about a life that follows the sea, from 
 port to port, from country to country, from ocean to ocean, 
 amid ever-changing, ever-shifting scenes, as compared with the 
 quiet, stationary, though commendable, life in the factory, the 
 farm or the office. 
 
 "There is fascination about being one of the crew of a ship 
 of the United States navy — the navy that carries the stars and 
 stripes, the navy that produced a John Paul Jones, a Lawrence, 
 a Decatur, a Perry, a Farragut, a Porter and a Dewey, the 
 navy that gave birth to such expressions as, 'I have only begun 
 to fight,' 'Don't give up the ship,' 'We have met the enemy 
 and they are ours,' 'Damn the torpedoes, go ahead,' 'You 
 may fire when you are ready, Gridley,' — expressions that will 
 live in the minds of men forever. ' ' 
 
 These are only a few of the arguments set forth. It is ob- 
 vious, however, that many of the arguments would not do 
 except for cold weather. With a change of season, the recruit- 
 ing offices doubtless provide themselves with slightly different 
 literature. 
 
 Not long since a cruise was made up the Hudson with the 
 result that many country boys, who are most easily fascinated 
 by a life they know nothing about, were enlisted. The result 
 of this foray was that a great scarcity of farm hands was ex- 
 perienced the following season throughout the region. 
 
 The same policy of using vivid colors to attract the recruit 
 is followed for the army as well as for the navy, and in cities 
 the recruiting officers, in spick and span uniforms, station them- 
 selves in public squares, like Salvation Army chaps, where there 
 is a considerable floating population, and there exercise their 
 handsomeness and talents in getting men into the army. 
 
 The results of this system of misrepresentation as to the real 
 life of the soldier are forcibly summarized by Bailey Millard 
 in "The Shame of Our Army" in the Cosmopolitan Magazine 
 of September, 1910: 
 
 "From the year 1900, according to the actual figures and 
 estimates of officers in the War Department, up to the end of
 
 302 THE PRICE OF INEFFICIENCY 
 
 the fiscal year ended June 30, 1910, there deserted from our 
 new army a total of 50,000 men. This is allowing only 4,000 
 desertions for the past fiscal year, no report of which will be 
 made until October, while the indications as prefigured by the 
 number of courts martial for desertion, are that the total will 
 be as large if not larger than for 1909. Think of it! Over 
 fifty thousand deserters! The record would be ludicrous if it 
 were not so tragic. 
 
 ''Do we gain any consolation by looking further into the 
 figures for 1909? Not an atom. For example, take the Sixth 
 Infantry. From the regiment 142 men deserted, or 12.9% of 
 the whole number. Then there was the Eighth Cavalry, with 
 12.7% desertions and the Fourth Field Artillery, with 10.4%. 
 Blackest of all the records among individual troops and com- 
 panies was that of Company K of the Twenty-eighth Infantry, 
 located at Fort Snelling, Minnesota. Of the men in this com- 
 pany, nearly one-third became disgusted with the service and 
 fared forth to seek other fields of usefulness. 
 
 "Here are four other companies that had high percentages 
 of desertions last year. Company M, Sixth Infantry, 20.2%; 
 Battery B, Fourth Field Artillery, 18.4%; Troop B, Eighth 
 Cavalry, 17.9%, and Battery E, First Field Artillery, 17.6%. 
 
 "Other posts at which there were high percentages of deser- 
 tions last year were Fort Duchesne, Utah, 15.8%; Fort Yellow- 
 stone, "Wyoming, 15.8%; Fort Robinson, Nebraska, 15.6%; 
 Fort Columbia, Washington, 15.4%. 
 
 "It is in the dog days that most men desert. Over 23% of 
 last year's desertions occurred in July and August. A hot 
 hike over a dusty road on a practice march in which the valiant 
 private sees no sense or reason, a ditch to be dug under the 
 blazing summer sun, an acre of brush to be grubbed out, or a 
 close, smelly stable to be cleaned by the sweat of the cavalry- 
 man's brow, and there is an end to the dream of military glory. 
 
 "It is a shock to most young Americans who have enlisted in 
 the army to taste the delights of military life to find that the 
 most important part of their training, from the viewpoint of 
 the post commander, is to dig ditches, M^ash pots and pans, wait 
 on table, clean out stables, sweep off walks, or cut brush in the 
 hot sun. Those were the conditions the deserters from the 
 posts just mentioned found in the army. Soon they began to 
 loathe the life. It sickened their souls, it humbled their pride 
 and they ran away from the service.
 
 THE RIGHT TO WORK 303 
 
 "Of all the compauies of white soldiers in these United 
 States and their dependencies in 1909, there were only five 
 from which there were no desertions." 
 
 The experience of the American enlisted man is in strong 
 contrast to the German army conditions. As all able-bodied 
 men must serve in the army in Germany, the government has 
 to adopt no undignified schemes to get enlistments, and the 
 entire point of view is different. Although formerly in the 70 's 
 and 80 's, there were numerous desertions and conditions were 
 harsh, this is no longer the case. The array is managed in the 
 same thorough and efficient manner as other industrial and 
 educational undertakings. 
 
 In the first place, service in the army, although compulsory 
 for rich and poor alike, is not regarded any longer as an irk- 
 some thing. The service is an expression of patriotism, a duty 
 discharged to the state, second only to the duties owed to one's 
 parents. This point of view changes the entire situation and 
 while service in the army is not a pastime by any means, it is 
 a healthy and wholesome experience, and there are few Ger- 
 mans who do not look back on their time of service with pleas- 
 urable recollections. 
 
 In addition it is a moral and educational training, instilling 
 patriotism and respect for the state and authority. The dis- 
 cipline received is one of the soldier's best assets in later life 
 and though misinformed economists cry out against the vast 
 cost of the army, it is only in a small degree, if at all, a social 
 waste. 
 
 After the common school course in Germany, it is compulsory 
 for the worker to attend the continuation school part of the day 
 or evening, until the age of eighteen is reached, during and 
 after which time a trade must be learned. The two or three 
 years' military service occurs usually from the latter half of 
 the twenty-first year until the age of twenty-four is reached, 
 but it is optional to begin at 18, or in the case of one taking 
 a college course which might be interrupted to postpone the 
 one year of military service imposed on those taking higher 
 courses of education, until 26. 
 
 A system thus which sees to it that the young man is prop- 
 erly equipped with a vocation and whose service in the army, 
 too, adds elements of discipline and of moral and patriotic 
 force to his make-up, is certainly superior to the haphazard 
 system of the United States where no one is compelled to learn
 
 304 THE PRICE OF INEFFICIENCY 
 
 any vocation, where the conditions are such that the learning 
 of a trade is made very difficult and where the needs of the 
 army are filled by enticing young men into enlisting in a serv- 
 ice from which so large a proportion desert, to remain fugi- 
 tives from justice thereafter, without trades or any settled 
 means of a livelihood. 
 
 "Whenever conditions such as now exist in the army are seen 
 on such a scale and over such periods of time, they become an 
 indictment of the system. The deserters are not to blame, they 
 are the victims of the system, the false and aristocratic organi- 
 zation of the whole army. The trouble begins at West Point 
 where a certain class of young men are educated in military 
 matters in such a manner as to transform them into snobs. 
 They then become officers and the enlistment under their com- 
 mand have little or no opportunities of rising to such heights. 
 A line of demarkation thus exists between the officer and the 
 private. They are not comrades, but the officer considers him- 
 self a superior species and regards the enlisted man as a mere 
 convenience or body servant. This is quite out of accord with 
 the temper of a democratic country and is the basic reason 
 why there are so many desertions. 
 
 The system should be overhauled. "West Point should either 
 be abolished, or admission to it gained only after service in the 
 ranks consequent upon an ordinary enlistment, and gained by 
 competitive examination, free to all enlisted men and free 
 from all political influence. The heads of the army should 
 come up through the army, and not be saddled on it by an 
 aristocratic method as at present. While it is now possible for 
 an enlisted man to become an officer, he labors under a stigma 
 of having come up through the ranks instead of from West Point. 
 This should be entirely removed. Until it is, conditions in the 
 army will not improve. 
 
 While military service to the extent required by Germany is 
 unnecessary in the United States, a six months' course, or even 
 ninety days in the army for every citizen, would be a distinct 
 benefit for all concerned. 
 
 In Germany, it is regarded as the duty of the state to see 
 that the worker is competent in some line of work, and then 
 to utilize every facility to protect him against non-employment 
 and to aid him in sickness and age. That the right to work is 
 becoming more and more a right of mankind, of a nature sim-
 
 THE RIGHT TO WORK 305 
 
 ilar to the rights struggled for aiid gained by earlier genera- 
 tions, is coming to be more and more recognized. 
 
 Speaking at the municipal Fourth of July Celebration in 
 Faneuil Hall in Boston, 1911, Dr. Charles W. Eliot, president 
 emeritus of Harvard, one of the most noted of American think- 
 ers, declared that if the Declaration of Independence were to be 
 drawn up by the American masses in 1911, it would be a totally 
 different document from that of our forefathers, which declared 
 all men were created free and equal, an assertion to wliich he 
 gave the lie. 
 
 The new declaration, Dr. Eliot said, would contain provisions 
 like the following: 
 
 1. The national resources of this country-, including the pub- 
 lic health, are not to be sacrificed to secure immediate profits 
 to a few individuals or corporations to-day. 
 
 2. More money should be spent on public education, so that 
 new generations may become quick to deduce error. 
 
 3. Every citizen in a free state has an inalienable right to 
 that amount of employment which will yield for him and his 
 family a decent livelihood. 
 
 4. Every worker has a right to be insured against personal 
 losses due to acute sieloiess, injuries and old age. 
 
 5. Every man has a right to the normal pleasures and em- 
 ployments of life and the leisure to enjoy them. 
 
 6. Land and all instruments of production and distribution 
 of products should belong to society as a whole. 
 
 7. Every journeyman in one and the same trade, should re- 
 ceive the same w'ages. The hours of labor during a day should 
 be the same in all occupations. 
 
 8. ^Methods of neighborhood buying and selling similar to 
 those now successful in Denmark should be put into practice. 
 
 Dr. Eliot reasoned that a new declaration of independence 
 M'ould be appropriate in 1911, remarking: 
 
 "Is it not interesting to obsei'%'e that many of the complaints 
 made against King George III may still be made a^rainst the 
 democratic government which succeeded that of the King." 
 
 Making comparisons, he continued: 
 
 "The spoils system creates a multitude of unnecessary offices, 
 just as the King did. 
 
 "Tariff legislation has the same effect as come of the King's 
 arbitrary measures to cut off much trade with the rest of the 
 world.
 
 806 THE PRICE OF INEFFICIENCY 
 
 "Unjust methods of taxation still prevail, and still intrenched 
 abuses call for the exercise by the people of much patient suf- 
 ferance. ' ' 
 
 Dr. Eliot voices a deep conviction, widely felt to-day, but 
 while the efficiency of the government and its proper organiza- 
 tion would go a long way towards the results desired, it may 
 be noted that the right to work is an economic right and not a 
 right of principle. Freedom, equality before the law and other 
 natural rights involve no expense in themselves. "When Dr. 
 Eliot says that in a free state, every citizen should have an in- 
 alienable right to that amount of employment which will yield 
 for him and his family a decent livelihood, he merely paints a 
 desirable condition without stating a principle. He does not 
 say who is to supply the amount of work needed, as Mr. Howe, 
 before quoted, failed to state where the superfluity of jobs was 
 to come from. Under the conditions depicted by Dr. Eliot, 
 population would increase so rapidly that the inalienable right 
 of employment and a decent livelihood would soon become im- 
 possible. 
 
 The right to work is a short and vigorous phrase. What it 
 really means is that every man should have an equal share of 
 work. 
 
 The absorption of wealth by the owners of machinery, or 
 other means of production, has to-day a powerful influence in 
 creating hard conditions for the worker, but taken with this, 
 the standard of living is higher than in former generations, and 
 the effort to maintain the standard of living, of the workman 
 to maintain a democratic level or at least the semblance of 
 equality as in former times when the population was less nu- 
 merous and distribution more nearly equal, and not to sink 
 into a definitely lower scale, taken with the competition of a 
 rapidly increasing population, has produced the conditions 
 which give rise to the assertion of the right to work. Such a 
 right is gradually losing ground. Conditions for the worker 
 are growing harder all the time, as may be seen from the sta- 
 tistics of the labor of women and children. 
 
 The governmental report, "Statistics of "Women at Work," 
 gives the following data: 
 
 "At the twelfth census, taken in the year 1900, the number 
 of women in continental United States 16 years of age and over 
 reported as bread winners, or as engaged in gainful occupations, 
 was 4,833,630. The total number of women 16 years of age and
 
 THE RIGHT TO WORK 307 
 
 over was 23,485,559. The proportion of bread w-inners, there- 
 fore, among women of that age was 20.6%, or approximately 
 one in five." 
 
 Regarding race and nativity, the report states that of the 
 female wage earners, there are 1,771,966 native white "s^dth 
 both parents native; 1,090,774 native white with one or both 
 parents foreign; 840,011 foreign-born white; 1,119,621 negroes, 
 and 72,947 Indians and Mongolians. 
 
 According to the report, the total number of children 10 to 
 15 for whom an occupation was reported by the census enumer- 
 ation in 1900 was 1,752,187. The report states further, that 
 it is certain that there are a considerable number of children 
 under 10 j^ears of age, who are earning money regularly by 
 labor. There are 142,105 wage earners 10 years of age. Of 
 the total number of child bread winners, 72.2% were boys and 
 27.8% were girls, rather more than one-fourth. Regarding 
 race and nativity, there are 837,402 native white with both 
 parents native; 293,210 native white with one or both parents 
 foreign born; 97,944 foreign-born white; 516,172 negroes, and 
 5,348 Indians and IMongolians. As there were 5,532,495 chil- 
 dren 10 to 15 years of age the proportion of child bread winners 
 therefore was approximately one in three. 
 
 This high proportion is even more disturbing than the pro- 
 portion of women wage earners. Dr. Felix Adler well voices 
 the protest which is being aroused when he says: 
 
 "I for one am startled by the fact that child labor exists at 
 all in the United States. No doubt it exists also in other coun- 
 tries, but one would have inferred, in view of the temper of the 
 American people, of their generosity, their love for children 
 and their well-known benevolence, that it could not take root 
 in this country. Why does it exist among a free and noble- 
 spirited people? Why is it necessary that there should be 
 State child labor committees and a National Child Labor Com- 
 mittee?" 
 
 The figures given above for child labor are now much exceeded 
 and it is estimated that children to the number of 2,500,000 are 
 now compelled to work. 
 
 The Wagner-Smith Commission of the State of New York 
 found that children of even only 4 or 5 years of age were at work 
 in canning factories in the state. 
 
 Women at work are often confronted with conditions inimicable 
 to their welfare. In the large department stores and garment
 
 308 THE PRICE OF INEFFICIENCY 
 
 manufactures wages are so low for many employees, particularly 
 young girls, that other means must be resorted to, to eke out 
 an existence. The noticeable overdressing of the female relatives 
 of the proprietors of such establishments provides a further in- 
 centive to the girl on starvation wages to drift into an easier life. 
 The real betrayer of the working girl is the employer who profits 
 by the low wages paid and thus creates the conditions which lead 
 to her downfall. 
 
 In addition to the question of the work of women and chil- 
 dren, who should be as classes, free from the necessity of wage 
 earning, and in addition to the low wages, harsh conditions of 
 work exist. 
 
 Examples of this are seen in the steel industry, a highly or- 
 ganized business, boasted as the creator of a thousand million- 
 aires of the three thousand in the United States. 
 
 The Bethlehem Steel Company where labor conditions were 
 investigated by the Department of Commerce and Labor, an 
 investigation which was confirmed by the Social Service Com- 
 mission of the Federal Council of the Churches of Christ in 
 America, found conditions justifying severe censure. Con- 
 cerning the hours of labor the report says: 
 
 "Just before the strike, 4,725 men, or 51% of all the em- 
 ployees, worked 12 hours a day; 220 workmen had a twelve- 
 hour day excepting on Saturdays, when their hours were either 
 ten or eleven; 4,203 employees had a work day of ten and a 
 half to eleven hours in length, generally with a half day off 
 on Saturday, and 47 worked on other schedules not speci- 
 fied. 
 
 "Beyond, and intensifying the evils of a twelve-hour day, 
 was the existence in many departments of a seven-day week. 
 Twenty-eight per cent, of all employees worked regularly seven 
 days in the week, but in addition were those who worked on 
 Sundays as overtime, regularly. While it is claimed by the 
 management that Sunday and overtime work is, in some de- 
 partments at least, optional with the men, it is nevertheless 
 true that foremen and gang bosses have compelled men to 
 work on Sunday against their protest and upon pain of dis- 
 charge. 
 
 "Wages," the committee says, "average less than 18 cents 
 an hour for 61 % of the 9,184 employees, or $2.16 for a twelve- 
 hour day. Of the balance, 31.9% earned less than 14 cents an 
 hour, or less than $1.68 for a twelve-hour day."
 
 THE RIGHT TO WORK 309 
 
 Similar conditions exist in other steel plants. Tn the Amer- 
 ican Magazine, in an article "Old Age at Forty," John H. Fitch 
 describes conditions in the United States Steel Co. in Pitt.sbnrgh. 
 
 "After nearly a year spent among- the Pittsburgh steel work- 
 ers in 1907 and 1908, three phases of the labor policies of the 
 steel companies stand out in my mind as overshadowing all 
 others; they are the factors that enter most deeply into the lives 
 of the men: A daily and weekly schedule of hours, both shock- 
 ingly long; a system of speeding that adds overstrain to over- 
 time, and crowning all, a system of repression that stifles initia- 
 tive and destroys healthy citizenship. 
 
 "To-day a large majority of the steel workers in Allegheny 
 county work twelve hours out of each twenty-four. There are 
 men classed as day laborers, and some molders and machinists 
 w^ho have a theoretical ten-hour day. But when the mills are 
 busy these men work twelve hours and longer. The machinists 
 work on repairs when there is a break-down, and quit when the 
 repairing is finished. Twenty-four hours on a job is no un- 
 common thing. I talked with a machinist one day who had 
 worked thirty-six hours consecutively the week before. 
 
 "Can you conceive of what it means to work twelve hours a 
 day seven days in the week? Twelve hours every day spent 
 within the mills means thirteen to fourteen hours away from 
 home, for the skilled men often live half an hour's ride from 
 the mills. It means early hours for the wife, if breakfast is 
 to be on time, and late hours too, if the supper dishes are to 
 be washed. It doesn't leave much time for family life, either, 
 when the husband begins to doze over his paper before the 
 evening's work in the kitchen is done, and when necessity inev- 
 itably drives him to bed early, so that he may get up in time 
 for the next day's routine." 
 
 Carnegie, the philanthropist and advocate of peace, cuts a not- 
 able figure in the history of our generation. But it was from 
 conditions such as these that he drew his wealth. As an iron 
 master, his hand w^as the hand of the iron master indeed, but to- 
 day he broadly distributes the bounty w^hich he ground from 
 working men and the fathers and sons of working men. He and 
 Rockefeller, a rival in benefactions, whose wealth was chiefly de- 
 rived through ruining his competitors by unfair methods rather 
 than by direct oppression of labor, give with a lavishness never 
 before known. A recent table of their benefactions is as fol- 
 lows:
 
 310 THE PRICE OF INEFFICIENCY 
 
 » 
 
 CARNEGIE GIFTS 
 
 Libraries $ 52,000,000 
 
 Pension funds 15,000,000 
 
 Carnegie Institute, Pittsburgh 16,000,000 
 
 Carnegie Institute, Washington 25,000,000 
 
 Peace Foundation 10,000,000 
 
 Scotch universities 10,000,000 
 
 Hero funds 9,000,000 
 
 Carnegie Steel Co. employees 5,000,000 
 
 Dunfermline Endowment 5,000,000 
 
 Peace Temple, the Hague 1,750,000 
 
 Polytechnic School, Pittsburgh 2,000,000 
 
 Allied Engineers societies 1,300,000 
 
 Bureau of American Republics 750,000 
 
 Small colleges in U. S 20,000,000 
 
 County of Cambria, Pennsylvania 600,000 
 
 To fight the hook worm 1,000,000 
 
 King Edward's Hospital, London 500,000 
 
 Miscellaneous in tlie United States 18,000,000 
 
 Tradesmen's associations 400,000 
 
 Miscellaneous in Europe 2,500,000 
 
 Carnegie Corporation of N. Y 25,000,000 
 
 Total $220,800,000 
 
 ROCKEFELLER GIFTS 
 
 General Education Fund $ 53,000,000 
 
 University of Chicago 2S',309,000 
 
 Institute of INIedical Research 8,240,000 
 
 Rush Medical College 6,000,000 
 
 Baptist churches 3,262,000 
 
 Baptist missions (foreign) 2,300,000 
 
 Missions ( local ) 2,300,000 
 
 Y. M. C. A 3,500,000 
 
 Barnard College 1,375,000 
 
 Yale University 1,300,000 
 
 Harvard University 1,000,000 
 
 Southern Education Fund 1,125,000 
 
 Union Theological Seminary 1,000,000 
 
 Baptist Education Society 1,000,000 
 
 To fight hook worm 1,000,000 
 
 Small colleges in United States 23,000,000 
 
 City of Cleveland 3,000,000 
 
 Hospitals and medical colleges 15,000,000 
 
 Juvenile reformatories 2,000,000 
 
 Miscellaneous 20,000,000 
 
 Total $174,711,000 
 
 Carnegie's gifts $220,800,000 
 
 Rockefeller's gifts 174,711,000 
 
 Carnegie's lead in benefactions $ 46,089,000
 
 THE RIGHT TO WORK 311 
 
 "What these enormous gifts really mean, whether they are a 
 burden or a blessing remains to be seen. To produce the interest 
 on this amount of capital, the whole efforts of not less tlian 
 200,000 men must continually be consumed, allowing the annual 
 earnings of a man to be one hundred dollars in excess of his 
 expenses, giving him a value equivalent to about $1,700 of cap- 
 ital at 6%, the governmental estimate of the value of a workman. 
 
 The Carnegie and Rockefeller benefactions amount to vast 
 economic machines for directing indefinitely the labor of 200,- 
 000 men from their ordinary channels to the purposes which 
 the benefactors select. AVhether in the end this is a condition 
 which is desirable is an open question. If all men of great 
 wealth for the next few generations did likewise, a time would 
 come when the burden of colleges, libraries and various founda- 
 tions would be insupportable. In the middle ages, the religious 
 orders became so burdensome through the benefactions accorded 
 them, that they were dissolved by governments. Even to-day 
 France has seized the property of the Roman Catholic Church 
 and similar seizures have been made in Germany, Spain and 
 Portugal. Too much philanthropy is thus seen to be far from 
 desirable. 
 
 The withdrawal from its natural channels of business of such 
 great sums of money and its devotion to education which is to 
 a large extent unproductive, may be included among the present 
 causes of depression. Working men are crushed under the domi- 
 nation of great industries that funds may be provided for these 
 benefactions, and the right to work often becomes no more than 
 the right to exist. 
 
 While the "Ironmaster" would not have derived from the 
 founding of an insurance fund for the workmen from whom he 
 drew his wealth the amount of advertising he has from the found- 
 ing of libraries or the display of his name cut in the stone or on 
 the brass tablets of so many building fronts, he would have acted 
 with more justice and the thought would not spring so readily in 
 the minds of the passersby that the stone and the brass should 
 read, instead of their present inscriptions, ''Carnegie Restitu- 
 tion." 
 
 It may be urged that conditions among workers generally, 
 especially among the unionized trades, are not as bad, but even 
 in these fields where the workman has succeeded in organizing 
 branches of it thoroughly, the results are not of a very encour- 
 aging nature.
 
 312 THE PEICE OF INEFFICIENCY 
 
 The situation is shown by an editorial in the New York 
 Times: 
 
 "Mr. Thomas Scully, the general organizer of the Inter- 
 national Plasterers' Union, made a frank admission as to the 
 relations between wages and earnings in the trade he represents, 
 which is extremely instructive. 'Our men are going to win,* 
 he said. 'They receive, it is true, $5.50 a day for eight hours, 
 but their average for fifty-two weeks is not more than $11 a 
 week. ' 
 
 ''From the point of view of the working man who considers 
 only his immediate interests, it may be just as well to earn $11 
 per w^eek on a scale of $5.50 for an eight-hour day, as to earn 
 this much by work covering more hours on a lower scale. But 
 there is another point of view which the wage earner cannot 
 refuse to take, without putting in jeopardy his interests as a 
 citizen, a consumer, a payer of rent, and a participant in gen- 
 eral prosperity. It may be assumed that $11 a week is not all 
 the ambitious plasterer cares to earn or has use for. Obviously, 
 however, it is all he can earn under a scale of wages which can 
 be sustained only by restricting his average earnings to the 
 amount named. 
 
 "He must be more or less continuously on strike, and by re- 
 ducing his output of w^ork to the least amount consistent with 
 his views of what he should earn in the time devoted to work, he 
 restricts building operations, discourages the improvement of 
 real estate, makes dw^ellings scarcer and rents higher, so that his 
 $11 a M^eek is not worth as much to him as it would be if won 
 under conditions less destructive of the general good. 
 
 "To the average mechanic it might seem like a paradox to 
 say that at lower wages he could probably materially increase 
 his earnings, and that if liberal earnings are his objective, the 
 way to reach them is to fix the wage scale at a practical figure, 
 and give up striking and contention. However, this is the 
 truth, and it may be that by reflection he will come to a realiza- 
 tion of it." 
 
 From this it will be seen that the plasterer, though his wages 
 are high while he works, does not earn as much as the steel 
 worker in a given year. All his unionism brings him is the 
 privilege of loafing and paying higher rent. The union is thus 
 an agency of inefficiency. 
 
 While the rise of the contractor to a position of wealth is pre- 
 vented, since the contractor cannot make a profit out of his
 
 THE RIGHT TO WORK 313 
 
 labor, he has not in reality benefited anyone thereby, not even 
 himself. 
 
 The difficulty of the worker getting a larger proportion of 
 profits for his Avork than arises out of natural causes — the rela- 
 tive supply of labor and capital — is thus seen to be insurmount- 
 able, and the right to work is not a right that is inalienable. 
 Temporary expedients will not do. A thorough and systematic 
 reorganization of the relations of labor and capital, a new fair- 
 ness on both sides, cooperation, different educational systems 
 and an efficient governmental policy must gain for the worker 
 a fairer share than he can get under present haphazard methods.
 
 CHAPTER XX 
 SOCIAL INSURANCE 
 
 Marvelous growth of insurance — An unknown force a few generations ago 
 — Compulsory insurance in Germany — The six forms of social insur- 
 ance — The frightful waste of accident liability in the United States — 
 What compulsory insurance costs the Krupp Company — Germany's 
 program of human salvage — Important provisions of German insur- 
 ance laws — What the widow receives — Shares of other beneficiaries — 
 No lump sums as premiums for litigation — Maternity insvirance — The 
 wolf at the German door — Ethical effect of old age insurance. 
 
 The world has progressed far in the last century, and its 
 progress is nowhere so strikingly shown as in the extension of 
 insurance. One hundred years ago insurance was looked on 
 as of a sacrilegious nature, and .it was a bold and forward per- 
 son who would attempt to thwart the designs of Providence in 
 such a manner. 
 
 To-day insurance is one of the largest factors in the social 
 organization, and its development in the hands of private com- 
 panies has been so phenomenal that it is coming to be regarded 
 as more properly a governmental function. 
 
 Though accompanied by violent and complicated discussion, 
 the governments of Europe following the lead of Germany, are 
 steadily adopting compulsory state insurance in various forms, 
 supplementing and enlarging the work of various mutual bene- 
 fit associations. 
 
 Though the governmental participation has undoubtedly 
 stimulated the development of all the activities of mutual bene- 
 fit societies, particular^ in the matter of sick insurance, the 
 providing of this form of mutual benefit for the entire class of 
 wage earners has by no means been accomplished. The only 
 practicable method of accomplishing this is by means of com- 
 pulsory insurance, which usually carries with it the shifting of 
 a certain portion of the burden from employee to employer. 
 
 The United States Commissioner of Labor has investigated 
 the subject of state insurance, and the government has published 
 a comprehensive and exhaustive report on the subject, which in 
 
 3U
 
 SOCIAL INSURANCE 315 
 
 common with the many highly valuable reports of the govern- 
 ment, is readily available. In this respect, the United States 
 is far in advance of other countries in the complete and thorough 
 reports and investigations of a wide variety of subjects made 
 by its experts, while their ready accessibility increases their 
 value. 
 
 The reports cover not only the German governmental insur- 
 ance systems but also those of other countries, but as Germany 
 was the pioneer in this field, and the systems of other countries 
 have been largely based on hers, the reports refer most fre- 
 quently to that system. The subject is so great that only its 
 salient features can be touched upon here, and the leading 
 features of the German system will be principally consid- 
 ered. 
 
 The Commissioner's report states: 
 
 "Germany by its act of June 15, 1883, was the first to in- 
 troduce the compulsory sickness insurance sj-stem on a national 
 scale, and its example was followed by Austria in 1888, Hun- 
 gary in 1891, Luxemburg in 1901 and recently by Norway in 
 1909. 
 
 "In all these countries, an effort was made to retain the sick 
 benefit societies existing at the time when this legislation was 
 enacted, as it was felt that local administration and self-govern- 
 ment were necessary for the success of this system, and there- 
 fore a great variety of organizations is found in the countries 
 mentioned, even under the uniform system of compulsion. 
 Funds based upon geographic limits, establishment funds, 
 trade funds, and others frequently operate side by side, though 
 at the present time the tendency is to strengthen the funds based 
 on geographic limits. 
 
 "The rapid development of the compulsory sickness insur- 
 ance idea is demonstrated by the numerous proposals in favor 
 of the compulsory system in various countries in which as yet, it 
 does not exist. Thus France, Italy, Russia, and Switzerland 
 may be mentioned as countries in which proposals for compul- 
 sory sickness insurance have been seriously considered within 
 recent years. 
 
 "The growing importance of the subject of employees' insur- 
 ance in this countiy, is indicated by the fact that within recent 
 years, eight states, Connecticut, Illinois, ^Massachusetts, :\Iinne- 
 sota. New Jersey, New York, Ohio and Wisconsin, and the Fed- 
 eral Government have appointed commissions to study methods
 
 316 THE PRICE OF INEFFICIENCY 
 
 of compensating workmen for disability incurred in the course 
 of their employment. 
 
 "As a result of these activities, one state, New York, has al- 
 ready enacted laws of general application, while two states, 
 Montana and Maryland, have made provision for state systems 
 of co-operative insurance against accidents to workmen engaged 
 in mining. 
 
 " 'Social insurance' may be defined as the method of organ- 
 ized relief, by which wage earners or persons similarly situated, 
 and their dependents or survivors, become entitled to specified 
 pecuniary or other benefits, on the occurrence of certain emer- 
 gencies. The right to these benefits is secured by means of 
 contributions from wages, or by the fact of the insured person's 
 employment, or by his citizenship or residence in the country. 
 
 ''The various forms of social insurance may be designated 
 as: 
 
 "1. Accident. 
 "2. Sickness. 
 
 I < 
 
 < i 
 
 3. Maternity. 
 
 4. Invalidity and old age. 
 
 5. Unemployment. 
 
 "6. Insurance for widows and orphans. 
 
 "The principle of systematic compensation for losses due to 
 industrial accident has been long known in Europe for the 
 earliest examples are found in the mining industries, especially 
 in Germany and Austria. As these industries were the first to 
 be operated on a large scale, with large numbers of employees 
 whose life and safety depended on the care and skill of the 
 manager and of the fellow workmen, and in addition had a 
 high danger rate, it was but natural that attempts should be 
 made to provide in a definite manner for the relief of the dis- 
 tress of employees caused by accidental injuries or physical 
 disability. 
 
 "The industry of navigation possessed similar characteristics 
 and also developed at an early date, comparatively well-defined 
 systems of relief for disability arising from the operation of 
 vessels. The next industry to be operated on a large scale and 
 which had at the same time a high trade risk, was that of rail- 
 road transportation, and in the states of the present German 
 Empire, we find early efforts to make provision for railway em-
 
 SOCIAL INSURANCE 317 
 
 ployees on a more liberal scale than that prevailing in the man- 
 ufacturing industries. 
 
 "With the development of large scale industries and the more 
 frequent use of machine power, together with the increase in 
 the size of industrial establishments, there was an increase in 
 the trade risk of the industries so affected. Previous to the de- 
 velopment of large scale production, a comparatively simple 
 system of compensation for industrial accidents prevailed in 
 nearly all the countries in the world, based upon the idea 
 that a workman suffering an injury from industrial accident 
 should be compensated by the person or persons at fault in 
 causing the accident. The relief provided under the Civil Code 
 in continental Europe, was more readily obtainable than that 
 permitted under the English law, but in each case, the person 
 liable was supposed to have committed some fault and it was 
 necessary for the plaintiff to bring suit and prove such fault, 
 of negligence, according to the rules of evidence prevailing in 
 the courts of each country." 
 
 The system of bringing suits is the one in vogue throughout 
 the United States, and as is well known, works great hardships 
 un the injured and is subject to grave abuses. 
 
 Large employers are constantly the victims of conspiracies, 
 while the case of an innocent victim of an accident is often 
 defeated by perjured testimony introduced by the employer. 
 Lawyers divide the larger part of the benefits, and the length 
 of time taken to secure the compensation is one of the reproaches 
 of the American judicial system. 
 
 The state of New York recently enacted a new employers' 
 liability law, but it was declared unconstitutional by the courts 
 and thus no practical headway has been made to correct the 
 bad practice of the plan of compensation for accidents at pres- 
 ent in vogue. One of its worst features is the fact that the 
 awards by juries are irregular and disproportionate, some juries 
 awarding more for the loss of a hand than others do for the 
 loss of an arm, while a leg is often more highly valued than a 
 life. 
 
 Mr. Frederick C. Howe in "How Germany Cares for Her 
 "Working People," in the OutlooJc of May, 1910, explains in an 
 interesting way the main outlines of the system : 
 
 "Insurance against sickness has been provided since 1884. 
 It is provided for those employed in factories, mines, work 
 shops, quarries, transportation and other industries. Employees
 
 318 THE PRICE OF INEFFICIENCY 
 
 of public enterprises are also covered. The provisions of the 
 law are limited to those whose wages are below $500 a year. 
 The sickness insurance funds are of various kinds. There are 
 local funds provided by the parishes for all of the trades within 
 their limits. Some of the large industries have funds of their 
 own, as do the mine owners and the contractors in the building 
 trades. 
 
 "All of the funds provide for free medical attendance and 
 supplies as well as sick pay from the third day of sickness. 
 The benefits amount to one-half of the daily wages received by 
 the beneficiary or the amount upon which his assessment is 
 based. Benefits are continued for not more than twenty-six 
 weeks, after which time, if the illness still continues, the burden 
 is transferred to the Accident Insurance Fund. 
 
 "The insurance fund in Gennany is sustained by the work- 
 ing men, the employers and to some extent by the community. 
 Generally the employee pays two-thirds of the premium, and 
 the employer one-third, the liability of both being ascertained 
 by periodic reports from the employer as to the number of em- 
 ployees liable to insurance. The premiums are collected by 
 stoppage, the employer deducting the assessments of the em- 
 ployees when wages are paid, which, along with his own share, 
 are then transmitted to the fund. 
 
 "The administration of the funds is largely in the hands of 
 the working people themselves, through a board chosen by the 
 employers and the employees. General meetings are held at 
 which all persons who contribute to the fund may come, at which 
 meetings the delegates who have charge of the insurance are 
 elected. About 12,000,000 persons are insured against sickness 
 in the German Empire, 
 
 "The provisions of the law of the insurance fund against ac' 
 cident, cover substantially the same classes as the sickness in- 
 surance, and the method of administration is substantially the 
 same. The employer is bound to provide insurance against 
 accident, as in the case of sickness. Upon opening a factory, 
 he automatically becomes a member of the trade association 
 covering his business, and is bound to contribute to the insur- 
 ance fund. This fund is managed by the executive board of 
 the trades, which has power to classify trades and fix the dan- 
 ger schedule. But, better than this, the board has power to 
 enforce rules and appliances for the prevention of accident. 
 If a member refuses to abide by the ruling of the hoard, he
 
 SOCIAL INSURANCE 319 
 
 may be fined for his neglect, or his danger rating is increased. 
 "By this means the employers are stimulated to an interest 
 in safety devices, while the special knowledge on the part of 
 the individual trade association leads to a better administration 
 of the rules than would be possible on the part of the state. 
 In all of these matters, the employees are consulted. They are 
 also allowed representation on the executive board. 
 
 "Benefits under the accident insurance law are not left to 
 judicial inquiry. The employee is not put to the expense and 
 delay of long litigation. Even though the employee is negli- 
 gent, he is entitled to compensation, unless there should be evi- 
 dence that he intentionally brought the accident upon himself. 
 Here, as in sickness, the cost of human wreckage in industry is 
 shifted in part on the cost of production. It is passed on to 
 the community where it belongs. 
 
 "The amount of the compensation paid depends upon the 
 wages of the employee and the extent of the injury. If the 
 accident wliolly incapacitates the worker, he receives a full pen- 
 sion, which amounts to two-thirds of his yearly wage. If he 
 is still able to work, the pension is adjusted to his earning abil- 
 ity. In case of accident resulting in death, an immediate pay- 
 ment of about one-sixth of the yearly wage is paid. In ad- 
 dition to this, the widow and dependent children are pensioned, 
 the widow until her death or remarriage and the dependent 
 children up to their fifteenth year. In this event, the annual 
 pension does not exceed 60% of the annual wage. 
 
 "Not only is the German workman thus insured against sick- 
 ness, which marks the beginning of much of the poverty of our 
 cities, as well as against the accidents of industrial establish- 
 ments, which fill the hospitals with the bulk of their patients, 
 but practically all German workmen are insured against old 
 age. Those whose earnings exceed $500 are not covered by old- 
 age insurance, nor are the higher class of employees and serv- 
 ants. The administration of this branch is carried on by in- 
 surance societies, which cover certain sections, or by the state 
 at large. 
 
 "All of them are under the supervision of the state and are 
 controlled by the employers and the employees. The old-age 
 funds are supplied by the employers and the employees, who con- 
 tribute in equal shares to the fund. To this the Empire adds 
 $12.50 towards every pension. 
 
 "The success of these insurance schemes is seen by the num-
 
 320 THE PRICE OF INEFFICIENCY 
 
 ber of members enrolled. There were 23,679,000 insured 
 against accident in 1908 and 15,266,000 against old age, and 
 13,189,600 against sickness. The total expenditures of the vari- 
 ous funds amounted to over $183,675,000 while the funds ac- 
 cumulated as a reserve exceeded $521,000,000." 
 
 In "The German Drift towards Socialism," by William C. 
 Dreher, in the Atlantic Monthly for July, 1911, the general re- 
 sults are summed up as follows: 
 
 "The aggregate revenues of the three systems in 1908 were 
 $214,856,675 and they paid out $165,000,000 in pensions and 
 indemnities. 
 
 "They owned invested funds amounting to $496,000,000. 
 The contributions in the three systems have been estimated by 
 careful statisticians at 6.75% of the wages received by the in- 
 sured, of which the employers pay 3.68% and the employed 
 3.07%. The insurance payments have a serious effect on the 
 finances of employers. Thus far, the famous Krupp company, 
 in 1908, paid $807,000 in insurance money, which was in the 
 ratio of $13.60 to $100 of net profits. Another great iron com- 
 pany paid into the insurance fund a ratio equivalent to $22 in 
 $100 and another nearly $47 in $100. 
 
 "Of course such expenses in addition to heavy general taxa- 
 tion, must prove a serious handicap to German industry; and 
 it is not to be wondered at that the feeling is gaining ground 
 among the employers that they are doing enough for their help. 
 Yet there is no indication that social reform legislation is to be 
 checked. The bill before the Reichstag, referred to above, ex- 
 tends sick insurance to farm laborers and household servants, 
 a change which will raise the burden of this system for employ- 
 ers from $24,000,000 to $36,000,000. The bill also provides for 
 pensioning the widows and orphans of insured laborers at an es- 
 timated additional expense of about $17,000,000, The Imperial 
 government has also just published a bill for establishing an 
 entirely independent system of insurance for the protection of 
 persons not included in the labor systems; it will apply practi- 
 cally to all employed persons having a salary less than $1,200." 
 
 While Germany had in 1908 a population of 63,000,000, the 
 number of wage earners was 16,000,000, of which 5,000,000 were 
 women, a proportion of wage earners to population of slightly 
 less than one in four. The United States with a population of 
 90,000,000 has 33,000,000 wage earners, a ratio of one to two 
 and three-quarters.
 
 Social insurance 321 
 
 In 1900 th^re" were 4,833,630 women wage-earners according 
 to the U. S. Census, and it is now estimated that the number ex- 
 ceeds 7,000,000, which is proportionately in excess of the num- 
 ber of women employed in Germany", 
 
 The impression that more women have to work in Germany 
 than in America, is thus seen to be gi-oundless. The German 
 woman, working more in the open, is further more healthfully 
 employed than the American woman, the larger part of whose 
 work is done in closed quarters, such as factories, sweat-shops, 
 offices, etc., and the result is shown in the more robust and vigor- 
 ous physique of the German woman. 
 
 Further, the number of women wage-earners in Germany can- 
 not be compared with the number in the United States, since 
 such a large proportion of the German wage earning women are 
 household servants; German domestic customs being such that 
 families of even limited means have servants. There is no stigma 
 attached in Germany to domestic service and the result is an 
 abundance of competent help for the housewives and a rule of 
 well kept homes which is almost unknown in America. 
 
 The more favorable proportion of wage earners to population 
 is due to the fact that the German retires much sooner to live 
 on his pension, while as a youth he begins to be a wage earner 
 later in life than the American boy. 
 
 Owing to the German custom of contracts with employers, 
 the profits of any gainful occupation that may be engaged in 
 after business hours, including inventions in the line of work 
 of the employment, go to the employer under certain circum- 
 stances. This still further identifies the interests of employers 
 and employees, and prevents the switching from one business to 
 another so prevalent in America. Though it discourages indi- 
 vidual initiative, it promotes a life of ease during the evening, 
 since the employee will hardly devote much energy to outside 
 tasks the fruits of which go to his employer. It accomplishes, 
 however, the object sought, of having the employees come fresh 
 to work, with their entire energy reserved for their daily work, 
 and not used up in outside schemes. 
 
 It will be noted that all wage earners are in three different 
 insurance systems, sickness, accident and old age or invalidity. 
 Thus all eventualities are provided for. 
 
 Mr. Howe, in the Outlook, says further: 
 
 "Aside from the positive accomplishments of the German 
 Empire in this line of social reform, one is impressed with the
 
 322 THE PRICE OF INEFFICIENCY 
 
 seriousness with which the cities as well as the nation are con- 
 sidering the whole question. There are frequent conferences 
 attended by representatives from the Empire and the various 
 states, from the cities, the universities and the philanthropic 
 societies. There is nothing hit or miss about it. The best 
 thought of the university and the most energetic of city officials 
 are constantly studying ways and means for the relief of the 
 numerous problems which arise in connection with unemploy- 
 ment, with the hazards of industry, with the poor and destitute 
 members of the community. 
 
 "Poverty has not been abolished in Germany, nor has the 
 housing question been solved. Industrial depression takes its 
 tribute there just as it does with us. But the impressive thing 
 about it all is that the nation views these questions in something 
 of the same light that it does the building of dreadnaughts, or 
 railways, of canals, the adjustment of taxes and the building of 
 cities. 
 
 "Germany more than any other country in Europe has en- 
 tered on a comprehensive programme of human salvage. She 
 is devoting her thought and her energy to the making of people 
 as well as of things." 
 
 According to Oberbergrat Kratz on "German Labor In- 
 surance," in Deiitschland als Weltmacht, the governmental in- 
 surance system paid out in 1908 for sickness, 324,785,767 marks 
 ($81,196,441), covering 5,655,836 cases. The management of 
 the system cost 19,209,686 marks, which is 5.4%. 
 
 In accident insurance Germany paid out in 1908, 157,062,- 
 870 marks ($39,265,718). The total benefits paid on accidents 
 from 1885 to 1908 amounted to 1,615,364,647 marks ($403,841,- 
 161). 
 
 The sickness insurance fund amounted in 1908 to 279,860,- 
 685 marks ($69,965,171), to which must be added the reserve 
 funds of insurance institutes which is 1,390,943 marks and also 
 the property owned, 52,249,910 marks, a total of $83,375,383. 
 
 Some of the leading provisions of the German law are as fol- 
 lows: 
 
 All workmen and administrative officers, the latter provided 
 that their annual earnings in wages or salary does not exceed 
 3,000 marks ($714) are insured, according to the provisions of 
 this law, against the results of accidents occurring to them in 
 the course of the employment, if they are employees: — 
 
 1, In mines, salt works, establishments in which ores are
 
 SOCIAL INSURANCE 323 
 
 treated, quarries, pits, ship yards, yards for preparing build- 
 ing materials and in factories, commercial breweries or smelting 
 works. 
 
 2. In industrial establishments which include the execution 
 of masonry, carpentry, roofing or other building work declared 
 by decision of the Federal Council to be subjected to insurance, 
 stone cutting, locksmithing, smithing, or well digging, and also 
 establishments engaged in chimney sweeping, window cleaning 
 or butchering. 
 
 3. In the administration of the post office, telegraph and rail- 
 roads, and in the administration of the navy and army, includ- 
 ing that of building operations which are carried on by these 
 departments on their own account. 
 
 4. In the business of carting, internal navigation, rafting of 
 wood, transportation on ferry boats and flat boats, tugging or 
 dredging. 
 
 5. In the business of expressing and storing goods and in that 
 of cellerage. 
 
 6. In the establishments of goods packers and loaders, goods 
 sorters, weighers, measurers, inspectors and stowers. 
 
 7. In the work of storage, tree felling, or work connected with 
 the transportation of persons or goods if such work is done for 
 a commercial establishment the proprietor of which is inscribed* 
 in the commercial register. 
 
 The insurance extends to domestic and other service to which 
 insured persons are assigned by their employers or by the em- 
 ployer's agents in connection with their employment in the es- 
 tablishment. 
 
 In case of disability compensation is rendered as follows: 
 From the beginning of the fourteenth week after the date of 
 the accident: 
 
 1. Free medical treatment, medicine and other means of heal- 
 ing, also the facilities (crutches, supporting apparatus, etc.) 
 to insure the success of the treatment and diminish the effects 
 of the injury. 
 
 2. A pension as long as the disability lasts. 
 The amount of the pension is — 
 
 (a) In the case of total disability and as long as it lasts, two- 
 thirds of the annual earnings (full pension). 
 
 (b) In the ease of partial disability and as long as it lasts, 
 a part of the full pension proportionate to the loss, through the 
 accident, of the earning capacity (partial pension).
 
 324 THE PRICE OF INEFFICIENCY 
 
 If, in consequence of the accident, the injured person is ren- 
 dered not only entirely incapable of work, but also sufficiently 
 helpless as to require attendance and care from others, the pen- 
 sion is to be increased to 100% of the annual earnings as long 
 as this condition continues. 
 
 If the injured person was, at the time of the accident, already 
 suffering from total and pennanent disability, no compensation 
 is made save that prescribed in paragraph first of this article. 
 If such injured person has been rendered helpless by the acci- 
 dent as to require attendance and care from others, a pension 
 of not more than one-half of the full pension shall be granted. 
 
 If, on account of the accident, the injured person is actually 
 out of work through no fault of his own, the board of directors 
 of the association may temporarily increase the partial pension 
 to the amount of the full pension. 
 
 In the case of death, the following compensation is also made : 
 
 1. As a funeral benefit, one-fifteenth of the annual earnings, 
 which shall be determined according to Article 10, paragraphs 
 1 to 4, but the grant shall never be less than 50 marks ($11.90). 
 
 2. A pension to be paid to survivors from the day of the de- 
 ceased person's death. (This consists of a proportion of his 
 annual earnings and is calculated in a complicated way accord- 
 ing to the circumstances of the case.) 
 
 If the deceased leaves a widow or children, the pension for 
 the widow, up to the time of her death, or remarriage, and for 
 every surviving child, up to the completion of its fifteenth year, 
 shall be for each, 20% of the annual earnings, but in no case 
 is such total to be more than the husband would have received 
 for total disability. 
 
 In the case of her remarriage, the widow shall receive 60% 
 of the annual earnings as a settlement. 
 
 If at the time of the accident, the deceased was married but 
 was, on account of her husband's invalidity, wholly or mainly 
 responsible for the support of the family, the following pensions 
 shall be granted as long as the need continues: 
 
 (a) to the widower, 20%. 
 
 (b) to every surviving child up to the completion of its fif- 
 teenth year, 20% of the annual earnings. 
 
 If the deceased person leaves parents or grandparents (as- 
 cendants) whom he was partly or mainly supporting, they shall 
 receive until the need ceases, a total pension of 20% of the 
 annual earnings.
 
 SOCIAL INSURANCE 325 
 
 It will be seen that in this system there is no possibility of the 
 awards of large sums as in the United States, and thus no great 
 incentives are hung up for litigation, and as the lawyers have 
 little or nothing to do with the matter any^vay, a great social 
 waste is saved. 
 
 Indeed the companies, which under a complicated system of 
 determining their proper shares of contributions to the funds, 
 might be supposed to be anxious to utilize technicalities to 
 escape their payments, are rather inclined to liberality than the 
 reverse, and do not usually confine their payments to the pen- 
 sion funds to the minimum, preferring by substantial contribu- 
 tions over their minimum requirements, to gain the good will 
 of employees and others in interest, with the consequent moral 
 
 effect. 
 
 The idea of an American corporation paying more for any- 
 thing than required by dire legal necessity, and for the sake 
 of good will of employees, is a condition too rare to need much 
 consideration. 
 
 The beginnings of sickness insurance may be traced further 
 back than those of insurance against accidents or any other form 
 of social insurance. These beginnings are to be found in the 
 organization of mutual aid, and are not limited to any special 
 social group. From this form of purely voluntary organization 
 supported exclusively by the contributions of its members, there 
 has been a steady development towards compulsory siclmess in- 
 surance, strictly regulated, and in some cases assisted by the 
 state, but the development is far from complete, and the com- 
 pulsory system has, as yet, been adopted mainly by Germany 
 and Austria. The important feature of this development has 
 been the fact that the mutual aid society was found, for many 
 reasons, to be the most convenient organization for the purpose 
 of accomplishing compulsory sickness insurance. Briefly, the 
 evolution of sickness insurance may be said to be by the fol- 
 lowing four stages: 
 
 1. Free and voluntary associations entirely unregulated by 
 law. 
 
 2. Regulation by law, either compulsory, for all, or optional 
 with classification of societies into recognized and unrecognized. 
 
 3. Regulation combined with government assistance. 
 
 4. Compulsory insurance. 
 
 With the growth of workmen's accident insurance systems 
 the burden of industrial accidents has fallen less heavily on the
 
 326 THE PRICE OF INEFFICIENCY 
 
 mutual benefit societies, yet it has been found advantageous, 
 both in Germany and Austria, to have the care of aU accidents 
 left during the earlier stages to the sickness insurance system. 
 The advantages of such a combination are, on the one hand, the 
 speed of relief, and on the other hand, the comparative simplic- 
 ity of administration and supervision, which tends to reduce 
 malingering. In other countries, where there is no such well- 
 organized system of compulsory insurance, the compensation 
 laws frequently provide for a certain waiting period during 
 which accidents are not compensated, and the duty of furnish- 
 ing relief in such cases usually falls upon the mutual benefit 
 societies. 
 
 A study of organizations for sickness insurance shows how 
 closely sickness is interwoven with the causes of economic dis- 
 tress. From the point of view of causation, it is often difficult 
 to draw the line between sickness and accident, while on the 
 other hand, sickness may develop into more or less permanent 
 invalidity. 
 
 In its earliest forms, the mutual benefit society naturally gave 
 assistance in all cases of disability, whether due to sickness or 
 accident, and the duration of the assistance varied with the 
 financial strength of the organization. The accumulation of 
 actuarial data has placed sickness insurance on a definite insur- 
 ance basis, and more careful differentiation between the vari- 
 ous causes and forms of infirmity has resulted. 
 
 Nevertheless, for practical purposes of administration, it is 
 often found of advantage not to draw the line too strictly. 
 
 One of the most recent developments of insurance in Germany 
 is a law in reference to mining, which arose out of a disaster in 
 a coal mine in Westphalia. The miners believed it could have 
 been prevented by a more perfect and frequent system of in- 
 spection of the mine, and the legislation now in effect provides 
 for the election by the miners themselves at each colliery, of 
 their own inspectors, who examine the underground conditions 
 at least once a month, and at the owner's expense. Thus the 
 workmen have in their own hands the means of protecting them- 
 selves. 
 
 Quoting again from the Commissioner of Labor, he states 
 in reference to maternity insurance : 
 
 "This branch of social insurance is still little developed in 
 most countries and is usually combined with the general system 
 of sickness insurance. The employment of women in industry,
 
 SOCIAL INSURANCE 327 
 
 however, has emphasized the importance of this form of in- 
 surance and also the differences between the provisions for ma- 
 ternity and the provision for ordinary sickness, which make a 
 separate treatment of this topic advisable from an administra- 
 tive point of view. The two main points of difference may be 
 stated as follows: 
 
 "First, maternity is a natural process which though calling 
 for medical help, in modern society usually runs a normal 
 course and requires a definite normal length of absence from 
 work. 
 
 ' ' Second, also unlike sickness, it requires the absence from work 
 for some time before the actual occurrence of childbirth. The 
 actuarial factors upon which a system of maternity insurance 
 must be built are different in that it concerns only the female 
 wage earners and those only within certain well defined age 
 periods, while the social purpose is even broader than that of 
 ordinary sickness insurance in that it concerns not only the 
 wage worker, but the future generation. The purpose of mater- 
 nity insurance is not only that of assistance to the mother but 
 also the reduction of infant mortality. 
 
 ' ' The earlier efforts toward accomplishing these aims consisted 
 in legislation regulating conditions of work of mothers for some 
 time before and after childbirth, so as to prevent the occurrence 
 of various diseases and accidents frequently connected with 
 childbirth. The period varies in the legislation of different 
 countries, usually embracing from four to six weeks. This 
 again, unlike sickness legislation itself, in case of maternity 
 forces a period of idleness upon the female wage earners and 
 therefore creates a need for financial assistance." 
 
 In Italy the law proposed in 1909 contemplated an equal con- 
 tribution from employer and employee of a sum equal to three 
 quarters of the pay for twenty-eight days. 
 
 "The earliest known forms of provision for the aged are the 
 systems of charitable relief in the form of outdoor relief and of 
 institutional relief, although neither of these forms can be 
 designated as features of a social insurance system. In some 
 employments, as, for instance, that of the various government 
 factories, pensions for superannuated or invalid employees have 
 been customary in Europe for many years. In addition, many 
 private establishments in Europe have been accustomed to pen- 
 sion aged or infirm employees after long terms of service; such 
 pensions are often entirely paid by the employer, the purpose
 
 328 THE PRICE OF INEFFICIENCY 
 
 oi" llic siiperanmialion pension in such establishments being to 
 se(;iire continuity of service from the employees. 
 
 "The pensions just mentioned, however, have affected only a 
 small proportion of the persons generally included in a system 
 of social insurance. The first forms of old-age and invalidity 
 insumnce proper are found in the mutual organizations of vari- 
 ous kinds, sucli as the miners' relief funds, seamen's funds, 
 trade union funds, mutual aid societies and the like. "When 
 these organizations adopted systems of old-age or invalidity 
 pensions it was usually without an adequate insurance basis in 
 so far as the liabilities being secured by the assets is concerned, 
 and at the prestnit time, even, many voluntary insurance organi- 
 zations are endeavoring to provide old-age and invalidity in- 
 surance without an adequate income in view of the liabilities. 
 
 "Under all of the accident compensation systems a fatal ac- 
 cident covered by the compensation law is compensated by a 
 b(Mierit in some form to the survivors of the insured person. 
 These benefits usually take the form of either a lump sum pay- 
 ment distributed to the widows for life or until remarried and 
 a pension to the children until a certain age is reached. It is 
 evident that many cases will arise where the death of the in- 
 sured person leaves the family in just as great distress as if the 
 death had been caused by an industrial accident, and in many 
 c;iscs file family is even in greater distress because death may re- 
 sult after a long period of illness in which the family resources 
 were exhausted in caring for the sick person. 
 
 "In order lo make provision for the class of cases just men- 
 tioned, widow and orphan benefits were provided by the miners' 
 relief funds in the various countries, but especially in Germany 
 anil Austria, Belgium, France and Great Britain. 
 
 "Similar provision, usually amounting to half the pension to 
 which the deceased was entitled or was receiving, is found in 
 the case of some of the railroad funds and seamen's funds. In 
 Germany, at the present time, the navigation accident associa- 
 tion which administers the compulsory accident and invalidity 
 insurance t'lU" the seamen, conducts a sj'stem of widow and or- 
 phan insurance which is founded on a carefully considered 
 actuarial basis. The German government now has under con- 
 sideration the creation of a national compulsorj^ system of in- 
 surance for widows and orphans, (Hinterbliebenen-Versich- 
 erung). 
 
 "In Germany under the invalidity and old-age law, in case a
 
 SOCIAL INSURANCE 329 
 
 member dies before reaching a pension, the survivors become 
 entitled to the dues or contributions paid in by the insured 
 person up to the time of his death." 
 
 The various systems of insurance in force in Germany have 
 proved of the greatest benefit to all concerned. The employer 
 by small periodical payments is relieved of the harassment and 
 losses of damage suits and the workman is free from anxiety 
 and relieved from distress, such as the American workman is 
 subject to through the lack of cordial relations to his employers 
 and the failure to recognize that their interests are in common. 
 
 Students of economics consider the superior efficiency of the 
 ■German workmen on the whole very largely ascribable to the 
 systems of insurance in force. The German working people 
 are as a class dependable and industrious. They take a proper 
 interest in their work, are steady in habits, trustworthy and 
 thorough. They do what they are told to do and do it well. 
 They understand their work and are not lost the moment any 
 new problem presents itself. 
 
 American workmen would not attempt to follow foreign plans 
 with a metric system, but German mechanics may often be seen 
 using original drawings in the English system of feet and inches 
 on foreign orders in difficult engineering work. 
 
 The insurance systems lend a backbone of confidence. The 
 wolf cannot approach the door so closely, and whatever may 
 happen, there is a margin of financial safety, a breaku^ater be- 
 tween the worker and necessity, which does not involve charity. 
 Thus he feels freer to devote his energies to his work and the 
 result is efficiency, indeed the highest state of efficiency which 
 Jias ever been j-eached by any nation.
 
 CHAPTER XXI 
 TOM, DICK AND HARRY 
 
 Their principal concerns — Enormous public attention paid to sports — 
 The horse and the extensive record of his past performances — The 
 bloodlust of the spectator of automobile races — The carnage of the 
 racing car — The hundred fatal milestones in the progress of aviation 
 ■ — The sacrifice of the lives of aviators to the humor of the crowd — 
 The harvest of the football field — Death on the side lines — The modern 
 boxing mill — Free flowing of gore though few fatalities — The base- 
 ball crank — The fascination of the game — Antique origin — Fearful 
 prevalence in America — Great economical wastes of the game — No 
 intelligence needed to be a baseball fan — Hence its popularity — Mis- 
 directed energy — The fatal celebrations of the Fourth of July — 
 Superfluous patriotism — The grim sport of lynching negroes — Ferocity 
 of this form of the lawless execution — Due largely to the law's delays 
 — A secret shame. 
 
 In America, a subject of the greatest interest to the general 
 public is sport. Tom, Dick and Harry devote a large part of 
 their mental energy and monetary resources to keeping track 
 of baseball, automobile and other sporting events. 
 
 The horse has a large circle of devotees and much study is 
 spent over the newspaper sheets showing his "past perform- 
 ances. ' ' 
 
 Every newspaper of consequence has columns, often several 
 pages, devoted to sporting events, and prize fighting, football, 
 bowling, tennis, golf, rowing, motor boat and motor cycle rac- 
 ing, swimming, high jumping, broad jumping, standing jump- 
 ing, hammer throwing, foot races, marathon races, marathon 
 dancing and various other sports receive the most minute at- 
 tention. 
 
 A peculiar feature of sport in America is the great number 
 of spectators compared with the number of those engaged in 
 the games. Of the spectators who assemble, often 50,000 at 
 a single event, few ever did or ever will practice the sport. 
 Their interest is in the contests, not in athletics, and in some 
 sports, notably that of automobile racing, a more sinister in- 
 terest is manifested, the interest of seeing a catastrophe. 
 
 330
 
 TOM, DICK AND HARRY 331 
 
 The public goes so far even, in its demands, as to force avia- 
 tors to undertake flights in weather so dangerous that during 
 the past season two fatal accidents resulted from this cause. 
 
 Automobile racing in the United States is carried on by pro- 
 fessional promoters, and in their lust for money they excite an 
 appeal to the blood lust of the spectator. Long races on roads 
 are undertaken at early hours in the morning, and the scores 
 of thousands of spectators are up the whole of the previous 
 night to reach the locality and see the race. They bank the 
 track on both sides for miles, crowding forward and it is only 
 a narrow lane that is left for the automobilists to traverse. At 
 their more than express train speeds, the result is that more 
 spectators are killed than participants. 
 
 At Syracuse, N. Y., on Sept. 16, 1911, a racing automobile 
 swerved from the track and plowed a path through the crowd, 
 killing ten people. 
 
 "To call such outrages accidents," says the Outlook, "is to 
 mock the truth. Before Syracuse had usurped the place, In- 
 dianapolis had probably the most prominent position in the 
 rivalry for this form of slaughter. 
 
 "That bloodshed and homicide are accounted among the at- 
 tractive features of such races can be shown by the method of 
 advertising. What can Americans say of the bull-fights of 
 Spain or the gladiatorial contests of ancient Rome, when an 
 automobile race is advertised as follows: 
 
 " 'Shaking dice with Death. 20 Dare Devil Drivers. In 
 Thrilling Speed Duels. The Field vs. Death— Which will 
 Win?' and when bulletins such as the following appear: 
 
 " '6:40 p. M. Car No. 4 ran into car No. 7, 
 
 " 'Two men hurt. 
 
 " 'Come out and see the SPILL.' 
 
 "It is hypocrisy to call the ghastly results of such races 'ac- 
 cidents.' They are 'features,' 'drawing cards.' Those who are 
 killed or crippled are the victims of human sacrifice to the twin 
 gods blood lust and money lust. 
 
 "This is not the view of those who deprecate healthful, ro- 
 bust sport, but of those who can distinguish between what is 
 robust and what is to the last degree brutal and murderous. 
 
 "It is time that the American people should make it plain 
 that they are not willing to let a crowd here and there, how- 
 ever numerous, have its savage way at the cost of the nation's
 
 332 THE PRICE OF INEFFICIENCY 
 
 reputation. If this pandering to blood thirstiness cannot be 
 stopped by public opinion, it should be stopped by law." 
 
 Barney Oldfield, one of the best known of the racing drivers, 
 in Popular Mechanics for September, 1911, says: 
 
 *'I was never famous until I went through the fence at St. 
 Louis and killed two spectators. Promoters fell over one an- 
 other to sign me up. 
 
 "The American grows sentimental about killing cattle; the 
 Mexican prefers cattle to human beings. It is merely a mat- 
 ter of taste. 
 
 ' ' I never realized my foolishness on any of these occasions 
 until I was in the hospital with the doctors standing around 
 and the nurses looking serious. 
 
 ''While the body of Basle lay still beside his machine, women 
 tried to cut off pieces of his clothing as a souvenir. On the 
 day after Basle's death, ten thousand persons fought for front 
 seats at the track. 
 
 "Many newspapers have even ceased to treat track racing 
 as a sport. Reports of the big races are placed on the front 
 page under a "scare," with lists of the dead and injured for 
 the year printed in heavy type at the head of the column. 
 
 "The dignity of motor racing is gone. It has ceased to be 
 racing, and has become merely a morbid and unelevating spec- 
 tacle. It is run for money alone. Its profits are blood 
 money. ' ' 
 
 The latest means of satisfying the spectator is the aeroplane. 
 No more hazardous sport can well be devised. In this case the 
 spectators have escaped injury for the most part, though a 
 notable exception among others is found in the death of the 
 French ]\Iinister of War, Henry M. Berteaux, who was killed 
 by a swerving aeroplane. 
 
 Aviation scored 100 deaths on October 14, 1911, with the 
 burning in the air of Aviator Hans Schmidt in Berne, Switzer- 
 land, while making an exhibition flight. Of the 100 fatalities, 
 sixteen occurred in America. The 200 mark was reached Oc- 
 tober 8, 1912 with the death of Joseph Stevenson at Birmingham, 
 Ala. Wliile some of the deaths have resulted from the neces- 
 sary risk in perfecting the aeroplane, and are chargeable to the 
 progress of the art, by far the greater number have been due 
 to flights undertaken for exhibition purposes and the deaths of 
 two in America at least, J. J. Frisbie in Norton county, Kansas, 
 and Frank H. ]\Iiller at Mansfield, Ohio, were due to the unruly
 
 TOM, DICK AND HARRY 333 
 
 conduct of spectators in forcing the aviators to ascend against 
 their judgment. 
 
 The first of the aviators to meet death was Otto Lilienthal, 
 of Hamburg, Germany, who fell while experimenting with a 
 2| horse power aeroplane, on August 10, 1896. 
 
 Exhibition flights, like automobile racing, constitute a phase 
 of the interest of the public in a possible catastrophe that is on 
 a par with the taste of the population of ancient Rome. Avia- 
 tors, mostly daredevil and adventurous men, work under a 
 great nervous strain. The slightest error may turn the grace- 
 ful and steady machine, which seems to fly so easily and safely, 
 into a mass of broken sticks and wires. The public wagers its 
 money against the aviator making such a mistake, and if he 
 does, and though he be killed the meet goes on. 
 
 The flying men in conversation ordinarily call aviation a 
 ''game," rather than calling it aviation; as ''he has been in 
 the game only a few months," or "one of the best in the game." 
 Truly it is a "game" when the public come to pay. 
 
 Another of the "games" the public throngs to see is the 
 gentle sport of football. The aviator unless he meets with 
 serious injury returns sound and whole, but every player that 
 goes into a football field, knows that days of soreness and 
 bruises, if not sprained limbs, broken bones or fatal accident 
 will be his certain share, along with the "glory" of it. 
 
 The manly art of football claimed 146 victims from 1901 to 
 1909, while 1612 were seriously injured. 
 
 Year Killed Injured 
 
 1909 33 275 
 
 1908 10 272 
 
 1907 15 166 
 
 1906 14 160 
 
 1905 24 200 
 
 1904 14 296 
 
 1903 14 63 
 
 1902 15 106 
 
 1901 7 74 
 
 The high water mark was reached in 1909 with 33 killed, 
 after which there was so much agitation that the rules were 
 changed, resulting, however, in 1910 in 14 deaths with 40 badly 
 injured, an improvement in a way. The 14 deaths resulted 
 from injuries classified as follows:
 
 334 THE PRICE OF INEFFICIENCY 
 
 Body blows 1 
 
 Injuries to spine 1 
 
 Concussion of brain 7 
 
 Blood poisoning 2 
 
 Other causes 3 
 
 In 1909 the injuries were of the following nature: 
 
 Critically injured 20 
 
 Broken collar bones 60 
 
 Broken noses 42 
 
 Broken legs 36 
 
 Broken ribs 26 
 
 Broken arms 24 
 
 Broken ankles 20 
 
 Broken shoulders 19 
 
 Broken wrists 8 
 
 Broken fingers 8 
 
 Broken hands 6 
 
 Broken jaws 6 
 
 The new rules under which football is now played are little 
 better than the former ones, as far as preventing injury goes. 
 If the professors and student body can find no way of re- 
 organizing the game, it is one that will sooner or later have 
 to go. There is also a darker side to football, in the fact 
 that it is occasionally proven that the injuries are intentionally 
 inflicted. 
 
 Bad blood develops between teams and individuals, and in 
 the tangle of the game, old scores are wiped out and new ones 
 entered in a way by no means polite. A game in which this 
 is possible, is inherently defective and not good sport. 
 
 Football appeals to the humorist also. Wallace Irwin in the 
 New York Glohe of Oct. 14, 1911, describes the views of a crea- 
 tion of his, a certain ''Col. Crowe of Cripple Creek," on foot- 
 ball. "Col. Crowe" has this to say: 
 
 " 'Tain't in it with bull-fightin '. In the first place the killin' 
 is all too harem scarem and accidental. There's plenty o' 
 brutality, but it ain't played up so that the audience can git 
 full benefit of it. Maybe it wasn't a first class game I seen; 
 but it seemed to me I'd a-gone away more satisfied if more o' 
 the injury had been did in full view of the audience. Time 
 and again I seen 'em do the same thing — all squat down with 
 their heads close together while the captain shouted 4 — 11 — C. 
 Q.D., thus givin' the secret signal for who was to be killed — 
 next y' knew some young man was left for dead in the field,
 
 TOM, DICK AND HARRY 335 
 
 while tliem assassins scampered away from the scene o' the 
 crime as merry as kangaroo colts. Now, I ain't raisin' no ob- 
 jections to murder, if it's included in the rules of the game; 
 but as long as the audience pays a dollar to git in and twenty- 
 five cents extra for the privilege of carrying a flag, I claim it's 
 their right to be in on all the fun. If somebody's got to be 
 killed, let it be did out in the open where everybody can see it. 
 Though I ain't got much use for a ]\Iexican, ordinarily I must 
 say they 're lots greater artists than us when it comes to a public 
 slaughter house event." 
 
 "You mean you prefer bull-fighting to football?" I inquired, 
 
 shocked. 
 
 "It's more square and above the table," said Col. Crowe. 
 "When a Mexican goes to a bull-fight, he goes with the ex- 
 pectation of seein' something or somebody killed. He's never 
 disappointed. And what's more, the killin' is played up into 
 a big draymatic spectacle. The bull, the horses, the bull stickers 
 are all marched out to the music of a brass band. The horses 
 and five or six assorted toreadors are slaughtered in full view 
 of the audience, right under the grandstand. Then when the 
 bull is all lathered up into a glorious state of peevishness, the 
 chief sticker steps forth into the center of the arena and they 
 fight it out. If the toreador kills the bull, the audience yells, 
 ' Bray-vo, toreador ! ' But if the bull kills the toreador, the audi- 
 ence with equal enthusiasm yells, 'Bray-vo, bull!' It's a cinch 
 game. AVhichever way y' play it y' git what y' want — a gory 
 sacrifice." 
 
 "Do you think the object of the sport is a gory sacrifice?" I 
 asked, more horrified than before. 
 
 "Well, ain't it?" inquired the colonel. "You'll generally 
 find that the public payin' from two bits to two dollars for 
 their ticket, is goin' to be disappointed if they don't see some- 
 body hurt. Hence sports. The object of a bull fight is to kill 
 the bull; the object of a football game is to kill the half-back; 
 the object of an aviation meet is to kill the aviator, the object 
 of a melo-dray-ma is to kill the villain ; the object of a baseball 
 game is to kill the umpire; the object of a prize fight is to see 
 a 400-pound white hope beaten hopeless by a six-ounce fireman 
 from Pueblo." 
 
 A sport which is an innocent amusement, compared with foot- 
 ball when the number of fatalities is considered and one which 
 also arouses great interest, is the pastime known as boxing.
 
 336 THE PRICE OF INEFFICIENCY 
 
 Boxing at present is considerably under the ban. The fact 
 that it is a brutal and degrading sport for both spectator and 
 participant, has at no time been so clearly recognized, and in 
 most states, forms of it are illegal if not entirely forbidden. 
 Newspapers condemn it and those formerly its best friends now 
 see the error of their ways. Persons who formerly journeyed 
 all the way across the continent to witness such contests, are no 
 longer as enthusiastic as they were. Boxing, in fact, is under 
 a cloud, a dark cloud as it were, a strong, heavy "smoke," and 
 its days appear to be numbered. 
 
 Loss of interest in boxing has, no doubt, been one of the causes 
 of the recent enormous favor of baseball, a sport which for all 
 concerned is the most interesting and least dangerous of any 
 that has a great following. Although an average of but 8 or 
 10 persons a year are killed, their deaths are rather of an ac- 
 cidental nature than the more or less necessary outcome of the 
 game itself. 
 
 Baseball is the great American game. It was evolved in 
 its present form, in the early part of the last century, though 
 its rudiments reach back into antiquity. The excavations and 
 decipherings recently made at Boghaz-Keni, in Northern Syria, 
 by Prof. Winkle of Berlin and Prof. Hogarth of London, show 
 the game being played by Hittites, with gourd masks ; the umpire 
 being King Subbi-Liliman, who reigned in the eighteenth cen- 
 tury B. C. Balls and bats somewhat similar in construction to 
 those in present use are shown. 
 
 Forms of baseball exist in many countries, but as played in 
 America, its form is such as to be of the greatest interest to 
 spectator and public. It is a game of great adaptability, and 
 though usually played by teams of nine on a side, it may be 
 modified to suit almost any smaller number of players, and as 
 it requires no specially prepared ground, no individual imple- 
 ments, a single bat and ball serving all the players, and no spe- 
 cial costumes or paraphernalia, it is the most economical game 
 that can well be devised. 
 
 It may be played, too, at almost any season of the year, ex- 
 cept in cold weather, and at any hour of the day, while the 
 duration of the game, usually about two hours, may be varied 
 to suit circumstances. 
 
 The players need have no particular skill, as long as the op- 
 posing teams are about evenly matched, and its demands on 
 the players do not involve over-exertion, since periods of rest 
 are afforded between runs.
 
 TOM, DICK AND HARRY 337 
 
 For the spectator the game is open and easily followed, while 
 interest is continuously maintained with frequent intensifica- 
 tions. 
 
 Baseball brings its devotees into the open air, and it is a 
 sport of almost ideal nature, the only drawback being the rather 
 large number of players requisite and the necessity of an um- 
 pire, with frequent altercations over his decisions, and, in its 
 professional forms, of the over development of the part of the 
 pitcher, whose skill becomes so great that the batter has great 
 difficulty in hitting the ball, and the game loses in action, be- 
 coming merely a spectacle of the pitcher and catcher throwing 
 the ball back and forth. 
 
 Baseball as played in America is, at some time or other, a 
 sport engaged in by every boy, so tliat it is a game that is 
 understood and one in which, of the vast audiences that assem- 
 ble to view it, every spectator has been at some time a partici- 
 pant. It is, however, a man's game, pure and simple, as w^omen 
 take very little interest in it, much less than football, while 
 women with practically no exceptions do not play the game at 
 any period of their lives. The sudden exertions of strength 
 and quickness required put it beyond their physical powers. 
 
 Yet even as good a game as baseball is in itself, it has yet 
 been made a sort of national nuisance by the American ten- 
 dency to overdo a good thing. The followers of the game be- 
 come so absorbed in the results of the various series played 
 between the clubs of different cities each summer season for 
 the championship of the country, that their conversation be- 
 comes a burden to others not affected with similar interests. 
 
 Such enthusiasts known as "fans" when unable to attend the 
 game itself, or when it is being played in another city, congre- 
 gate in great numbers before newspaper bulletin boards, and 
 spend hours watching the returns from various parts of the 
 country, impeding street traffic, though otherwise acting in a 
 harmless manner, a welcome contrast to the activities of those 
 who attend football games and afterwards in their exuberance 
 of spirits, wreck theaters and parade the streets shouting half 
 the night, or more, and exhibiting various evidences of rowdy- 
 ism. 
 
 No subject, however important, receives the amount of pub- 
 lic interest shown in baseball. If the fate of the universe hung 
 on the result, there could hardly be more attention paid. Only 
 on election nights do greater crowds collect before the news- 
 paper bulletins, and then less out of real interest in the election
 
 338 THE PRICE OF INEFFICIENCY 
 
 than merely through general common consent and curiosity. 
 To the baseball enthusiast, life has but one great interest, and 
 beware the critic of the game. If he does not believe in base- 
 ball, he is "not a true patriot" and "no good citizen." Ex- 
 pressions of this kind are actually used by intelligent business 
 men in defending their interest in baseball. 
 
 And enthusiasm for baseball is no respecter of persons. It 
 seizes on rich and poor, employer and employees, capitalist and 
 office boy alike, and the attention given the subject is so great 
 that practically every normal citizen is compelled to take more 
 or less interest in it, while the number of those who attend 
 regularly runs into the millions. 
 
 The professional players receive salaries of three to ten thou- 
 sand dollars a season and the names of the most popular are 
 as familiar as those of celebrated persons in any line of en- 
 deavor, if not more so. The players of the teams in the cham- 
 pionship series at the end of the season receive large sums for 
 but a few games, the players' share of four games of the 1912 
 series being $147,571, or from $2,500 to $4,000 each, according 
 to circumstances.. 
 
 The amount of money expended in admissions to the game, 
 the half days lost from business and the amount of energy de- 
 voted to the subject in reality constitute a national waste of 
 large proportions. The best that can be said of baseball is 
 that it is not accompanied by gambling, and although the clubs 
 are managed for private profit, a singular thing when the pub- 
 lic nature of the institution is considered and when football is 
 quite free of any touch of commercialism, it being run by the 
 schools and colleges and played strictly by amateur players, 
 while baseball is only played by professional players to any 
 large monetary returns; it has remained a clean sport. Occa- 
 sionally politics gets in and dirties it up a bit, as in the distri- 
 bution recently of the tickets of a championship series to specu- 
 lators and bartenders of a certain political faith and the con- 
 sequent mulcting of the public. Boxing seems to have drawn 
 to itself most of the crooked work in sports, leaving baseball 
 clean. 
 
 The baseball fan is not noted for his mental attainments as 
 a rule. He is not proud of being a fan, neither is he ashamed 
 of it. He is so thoroughly a fan that fannism is a part of his 
 existence and he cannot understand the attitude of the critic. 
 He really believes that something is wrong with those uninter-
 
 TOM, DICK AND HARRY 339 
 
 ested in the game, or at least that they are not as perfectly 
 normal as they should be. 
 
 Baseball enthusiasm is jealous, however. The fan has no 
 other passion. He is not a student of the drama, nor does 
 opera arouse him, and a philanthropic concert is Greek to him 
 and gladly so, for there is no excitement to be found in them, 
 and the excitement of the contest is what he lives for. He does 
 not seek to make converts, but the fellowship of the mania is 
 the apotheosis of democracy. Well may the philosopher envy 
 the expectancy of the fan when he meets another and they are 
 going to the game, though he may be saddened that so much 
 energy is expended to no useful purpose. 
 
 The ethical aspect of baseball, the immoderate attention to 
 a series of contests which prove absolutely nothing once they 
 are completed, the vast concern over a thing of no real moment, 
 is well treated in an editorial entitled "The Baseball Craze" 
 in the New York Evening Journal, Oct. 14, 1911, an influential 
 newspaper noted for the moral tone of its editorials: 
 
 "The excitement in America over baseball is similar in char- 
 acter to the excitement in Spain over the bull-fight, and in the 
 Argentine over the game 'Pelota. ' 
 
 "It is not agreeable to throw cold w^ater on any kind of 
 enthusiasm. But the Evening Journal wants to remind young 
 men especially that it is extremely harmful to concentrate in- 
 terest on something that some other man is doing. 
 
 "It is all very well for a baseball pitcher or catcher to con- 
 centrate every ounce of energy on the achievement of some base- 
 ball deed. 
 
 "For that achievement means his success. 
 
 "But when young men put their minds day after day, on the 
 minute details of a baseball game, worrying over the failure 
 of this player, wildly enthusiastic over the success of another, 
 that is a very bad thing for the youth commonly known as a 
 'baseball fan.' 
 
 "If you are one of the hundreds of thousands of baseball 
 maniacs, remember this: 
 
 "It is quite likely that twenty years hence you will be one 
 of the average failures. 
 
 "And it is quite likely that some young man of your own 
 age very near you at this moment will be one of the exceptional 
 successes. 
 
 "You will be one of the average failures, because you will
 
 340 THE PRICE OF INEFFICIENCY 
 
 have devoted your most intense concentration, attention and in- 
 terest to baseball or something else that cannot help you. 
 
 "And the young man near you, no better equipped than you 
 for success, perhaps, will pass you in the race because at this 
 moment while you are thinking and yelling about the national 
 series' he is thinking, studying and concentrating upon some- 
 thing that will be of value to him and contribute to his success 
 twenty years from now. , 
 
 "No young man can do two things at a time with all his 
 energy. You cannot be a baseball fan with all of your energy 
 and at the same time be something else. 
 
 "No man ever made his real success unless the most intense 
 interest that he had in life was concentrated upon that suc- 
 cess. Don't deceive yourself with the idea that you attend to 
 your work very well and that the wild baseball enthusiasm does 
 no harm. The baseball mania gets your real concentration and 
 your work gets what is left, which is not much. 
 
 ' ' If you can learn to look at baseball in the same way, if you 
 can transfer to your own work, to your own acts and efforts 
 each day, the intense concentration and interest which you now 
 devote to the ba.seball game, to the names, acts and efforts of 
 uneducated, largely worthless and rather uninteresting pro- 
 fessional baseball players, your chance of success in life will 
 be improved." 
 
 The enormous energy devoted to baseball and other sports 
 in America, while not an active evil in itself, is a great loss 
 w^hen it is considered what might be the results were this energy 
 devoted to real progress. 
 
 Another evidence of misplaced energy is found in the method 
 of celebrating the Fourth of July. During the last nine years, 
 some 1,719 persons lost their lives in this way. The Neio York 
 Sim in an editorial, "Elimination of Superfluous Patriotism," 
 on August 30, 1911, says: 
 
 "It is only within the last five years that a serious effort 
 has been made to correct the abuses in question. Ten years 
 ago those who protested against them were treated generally 
 as anti-patriots, if not as traitors. But the majority had no 
 notion of the enormous amount of injury done, and did not stop 
 to think of it. Thanks to the Journal of the American Medical 
 Association, the facts have been made so plain by now that even 
 the hardiest patriot cannot explain them away or pretend that 
 such licentiousness is a necessary or desirable part of the
 
 TOM, DICK AND HARRY 341 
 
 education of young Americans. In the last nine years, our 
 boisterous way of celebrating Independence Day has been the 
 cause of 1,719 deaths and 37,410 injuries. 
 
 "Up to five years ago, the ordinary patriot was apt to defend 
 the explosive method of celebration upon the same plea as saner 
 critics defend football and other rough games. They had to 
 admit that some of the consequences were unfortunate, but con- 
 sidering the large number of persons engaged, the death rate, 
 they argued, was not after all very high. It was a question, 
 they said, whether the lives lost and the property destroyed 
 were not amply compensated by the spirit of patriotism aroused 
 throughout the country. And then they pointed out that it 
 was a gi-eat day for the boys, and that we must not forget that 
 we, too, used to be young— and so forth. 
 
 "But this sort of sentimentality could not stand against the 
 figures. In 1903, 406 died in the agonies of tetanus as a result 
 of wounds received on the Fourth of July; 60 were killed out- 
 right or died of their injuries, and 4,449 were hurt— some of 
 them blinded, some suffering the loss of limb, others the loss 
 of a finger or two, etc. The consequences were too appalling 
 to be ignored and at the last the more sensible of the patriots 
 began to be ashamed. 
 
 "In the last few years the demand for a safer celebration 
 has spread rapidly and we do not remember that this year any 
 of the papers protested against the regulation of fireworks and 
 firearms. This year there were altogether only 57 deaths and 
 1.603 injuries. Eleven of the deaths and 483 of the injuries 
 were caused by firearms, 5 deaths and 114 of the injuries by 
 toy cannons, but most of the deaths and most of the injuries 
 were due to the infamous giant cracker." 
 
 The following table, taken from the Journal of the American 
 liledical Association, gives the casualties for the last nine years : 
 
 Yeab Killed Injured Total 
 
 1903 466 3,393 3,859 
 
 1904 183 3,986 4,169 
 
 1905 182 4,994 5,176 
 
 1906 158 5,308 5,466 
 
 1907 164 4,249 4,413 
 
 1908 163 5,460 5,623 
 
 1909 215 5,307 5,522 
 
 1910 131 2,923- 3,054 
 
 1911 57 1,603 1,660 
 
 Total 1719 37,223 38,942
 
 342 THE PKICE OF INEFFICIENCY 
 
 The victims of the Fourth of July celebrations are not the only 
 ones due to carelessness and folly. The hunter in America 
 flourishes as nowhere else. In Germany the hunter must take 
 out an expensive license to hunt, and must then hunt only over 
 certain fields, set forth in his license. In America, the hunter 
 hunts at his own sweet will and the result was 113 deaths dur- 
 ing the season of 1910, a large increase over the usual figures. 
 In 1912, 92 were killed; 1911, 100; 1909, 87; 1908, 57; 1907, 82 
 and in 1906, 74. The deaths are mostly due to carelessness m 
 handling of guns, inexperience, and the mistaking of men for 
 deer and other game. Carelessness is an outcome of the thirst 
 for hunting, a form of blood lust so evident in the automobile 
 racing and football exhibitions. 
 
 The lack of restraint and tendency to violence which manifests 
 itself in sports is exhibited in far more sinister forms in the 
 taking of human life in various ways. 
 
 The New York Evening Sun in an editorial August 16, 1912, 
 
 states : 
 
 "According to the American Prison Association's committee 
 on criminal procedure, homicidal crime in the United States 
 has increased 450% since 1889, and the ratio of convictions is 
 less than 10%. 
 
 "In Germany the ratio of convictions is 95%. Homicidal 
 crime in the United States, according to the same authority, 
 exceeds the total of that of any ten civilized nations outside of 
 Russia. 
 
 ' ' Nearly thirty persons are murdered every day in the United 
 States, not including Alaska and the island dependencies. Not 
 one out of four murderers is brought to trial, and out of twenty- 
 five brought to trial only one receives a death sentence. Ten 
 thousand homicide crimes are committed in the United States 
 each year. 
 
 "In Chicago alone, in 1909, 118 homicide crimes were com- 
 mitted ; for the same time in London 20 of the same kind of 
 crimes were committed, and London is four times the size of 
 Chicago. New York City last year had 119 cases of homicide. 
 These figures are appalling and call for a close searching of 
 hearts by the American people. 
 
 "We are no less civilized than European nations. What then 
 underlies this terrible discrepancy in crimes involving human 
 life? 
 
 "One cause, undoubtedly, is the more general practice of
 
 TOM, DICK AND HARRY 343 
 
 carrying firearms, and the greater license in this respect 
 permitted everywhere in the United States as compared with 
 European peoples. Local laws, such as those now in effect 
 in New York state, against bearing deadly weapons, have 
 not the full backing of public and private opinion. This 
 state of opinion has led to laxity in the enforcement of the 
 law. 
 
 "From the earliest times Americans were accustomed to have 
 and bear arms openly; in fact, the right 'to have and bear 
 arms' is set down in the Constitution of the United States as 
 one of the inherent rights of the people. It was considered 
 one of the necessary protections in a new and unsettled country. 
 It did not refer, of course, to any right of private vengeance, 
 but rather enumerated an ancient privilege that had never been 
 questioned. 
 
 "The conditions of other countries in this respect was radi- 
 cally different. Feudalism, for instance, minutely prescribed 
 the classes who could bear arms, and named the kind of arms. 
 The selling of arms to the general population of other countries 
 has been jealously guarded by governments." 
 
 The carrying of firearms, however, is but a superficial indi- 
 cation of graver underlying causes. No man shoots to kill an- 
 other, no matter how many revolvers he has at hand, unless 
 there is in his heart an uncontrolled disregard of human life 
 and disrespect of law. The knowledge that so few murderers 
 are punished produces the disrespect and consequent absence 
 of fear of the law, w^hile lack of training in school and at the 
 home, absence, in short, of civilizing influence, is largely at fault 
 for disrespect of human life. Our school system while teaching 
 much arithmetic and geography teaches but little respect for the 
 rights or even the lives of others. 
 
 A thoroughgoing tightening of the bands of discipline is 
 needed all along the line, and the inculcation of respect for the 
 law in those Avho make the law and in those who obej-' the law. 
 Disrespect for the law starts with legislators who enact foolish 
 and impossible laws, it exhibits itself in executives who connive 
 at violations of the law and recklessly pardon criminals in great 
 numbers, and it continues in the citizens who evade and violate 
 the law for personal advantage and gratification. The law, how- 
 ever, can rise no higher than its source and its source is the 
 people. Respect for law and safety lies in education and in 
 the creation and enforcement of a healthy public opinion, of the
 
 344 THE PRICE OF INEFFICIENCY 
 
 enforcement of the will of those who are sound against the will 
 of those who are unsound. 
 
 Another form of what amounts to depravity is found in the 
 numerous Ivnchings which occur throughout the United States. 
 While lynching is not an organized crime and while there are 
 no habitual lynchers, its frequency over all parts of the country 
 show a primitive respect for law and order, to say the least. 
 In recent years the ferocity of lynching has increased and burn- 
 ings at the stake and unspeakable mutilations take place. 
 
 A table for the sixteen years from 1884 to 1900 shows the num- 
 ber of lynchings to have been 2,516. Of these, 2,080 were in 
 the southern states and 436 in the north. The proportion be- 
 tween blacks and whites was as two to one, 1,678 being negroes 
 and 801 white men. 
 
 The proportion of black men is rapidly rising, however, 
 which is accounted for by the fact that lynchings of white men 
 for horse and cattle stealing in the west were formerly more 
 common than they are to-day. Of the 2,516 lynched, in the 
 years mentioned, 2,465 \dctims were men and 51 were women. 
 
 A list of the causes of lynching in the sixteen years mentioned 
 is very interesting. It shows a range all the way from throw- 
 ing a stone and eloping with a girl to murder and assault. The 
 principal causes are divided as foUows: 
 
 ]\rurder, 980 ; attempted murder, 24 ; alleged murder, 28 ; rob- 
 bery and murder, 8 ; assault and murder, 6 ; suspected of mur- 
 der, 18; assault, 514; attempted assault, 77; alleged assault, 22; 
 horse stealing, 115; cattle stealing, 22; unknown cause, 92; no 
 cause, 10; race prejudice, 49; by whitecaps, 9; by vigilantes, 
 14; living with white woman, 1; enticing away servant girl, 1; 
 bad reputation, 8; unpopularity, 3; arson, 93; robbery, 38; out- 
 lawry, 48; keeping saloon, 3; and voodooism, 2. Altogether, 
 112 motives are assigned for the overriding of the law by the 
 wrath of the mobs. Several men were lynched for writing 
 letters to white women, one for asking a white girl to marry 
 him and several for quarrels with white men. 
 
 There has been, however, a decrease in the crime, for in the 
 ten years from 1900 to 1910, the number of lynchings was only 
 904. 
 
 It is a crime, however, which is a direct outcome of govern- 
 mental inefficiency, and the distrust of seeing the law adminis- 
 tered with celerity and dispatch is the direct incentive to mob 
 law.
 
 TOM, DICK AND HARRY 345 
 
 There appears to be, however, running through civilization 
 in America, a strain of ferocity, which may be an effect derived 
 in some ^\ay from the climate or configuration of the land or its 
 substance. The Indians preceding white men, seemed to have 
 a ferocity greater than that of other savage races in other parts 
 of the world, and though mostly good natured, the Americans 
 are subject to sudden strokes of vengeance and retribution which 
 the barbarities of Russia and the cruelties of the Spanish inqui- 
 sition do not surpass. This extends even to legal punishments, 
 and there are in force laws in certain of the American states 
 in reference to the sterilization of certain classes of convicts 
 which are of such shameful and horrible nature that it is incon- 
 ceivable to really civilized men how such laws could have re- 
 ceived any consideration at all, much less being put in force, 
 by legislatures of white men. Nothing more fiendish than these 
 laws can well be imagined, yet they have been enacted in a num- 
 ber of states, among which New York and New Jersey are the 
 most recent recruits. The public is probably too little aware of 
 the monstrous legal barbarity, which, however, has had the sanc- 
 tion of the Supreme Court of the United States, it being de- 
 clared within the police powers of the states to perform such 
 mutilations.
 
 CHAPTER XXII 
 CUTTING OUT THE MIDDLEMAN 
 
 How the middleman robs the isolated customer — The greatest crime of mod- 
 ern times — How combatted abroad by consumers' unions — How great 
 organizations of consumers reduce prices — Why such organizations are 
 lacking in the United States — How they may be established — Ex- 
 travagant characteristics of Americans — Boasted lack of culinary skill 
 on the part of American women — Poor household management — Why 
 matrimony fails to cope with modern conditions — Spending a dollar 
 like a millionaire — Thorough schooling of the European housewife — 
 Compliments at meal times — How consumers' unions are organized 
 abroad — Over 2,000 branches in the German union — 'The curse of soup 
 in cans — Operation of consumers' union — ^The bulletin and its con- 
 tents — How orders are placed — Advance orders — Arrangement and 
 business methods of a consumers' union store — Pre-Christmas dividend 
 — Removals — Courtesy and equal service — How such unions may be 
 established in the United States — Starting one in a small way — Con- 
 sumers' clubs and discounts — System of brass money — How prices 
 could be reduced — Present tax on cash purchaser eliminated — ^Why the 
 ten cent stores can sell so cheaply — How to save high rents of stores 
 — A new purchasing system — Supply depot for staples — A complete 
 store with discounts to members — Incentives to club managers — Small 
 clubs of consumers managed by women as a new occupation — Com- 
 munal kitchens — Ethical effect of reduction of cost of living so ef- 
 fected — Political significance of consumers' organizations — The start- 
 ling extent of the extortion of the middleman. 
 
 Perhaps the most conspicuous example of the lack of inter- 
 est which the American public takes in its own affairs as com- 
 pared with the European public, is in the absence of consumers' 
 unions or purchasing organizations, which so materially reduce 
 the cost of living to their members, particularly in England, 
 Germany and Switzerland. 
 
 The collective action of such groups, the cohesion and interest 
 taken by their members in them, is wholly lacking in America, 
 where the organized body of middlemen has taken advantage 
 of conditions and obtained such a power and dominance that 
 the prices of commodities have risen to the levels of extortion. 
 
 Consumers' unions in the countries mentioned have grown 
 to great proportions, and have proved of enormous public serv- 
 
 346
 
 CUTTING OUT THE MIDDLEMAN 347 
 
 ice. The bitter opposition which they have encountered from 
 tradesmen goes to prove their great value. 
 
 It will be interesting to point out the essentials of the organi- 
 zation of consumers' unions and to indicate how they may be 
 established in the United States, both on a large and small scale, 
 in the latter case by women of even ordinary business ability. 
 
 There are a number of important reasons for the existence 
 of consumers' unions abroad, which do not obtain in the United 
 States at present. Abroad there is a greater tendency to or- 
 ganize and support active co-operative societies of all kinds. 
 This is characteristic of a more mature civilization than pre- 
 vails in America and is also perhaps a characteristic of Euro- 
 pean peoples, Americans being of a more individualistic nature. 
 
 The American also looks less closely at his small expenditures. 
 He spends his nickels and dimes like water, buys a lot of news- 
 papers, cigars and knickknacks and then economizes with a 
 shoddy overcoat. The European looks more carefully to the 
 small daily expenses which, though slight in themselves, yet 
 which in the course of a year aggregate so much, and thus he is 
 able to afford a larger outlay for the few items of considerable 
 expense which occasionally arise. 
 
 A further reason for the absence in the United States of such 
 consumers' unions is in the attitude which the American woman 
 takes toward her kitchen, as compared to that taken by the 
 man abroad. With large numbers of American women, it is a 
 frequent boast that they do not know how to cook a meal, or have 
 no idea how certain dishes are prepared, or do not know, in 
 some cases, how to make a cup of coffee. Of this lack of culi- 
 nary skill they show considerable pride, and they do not hesitate 
 to air their ignorance. The American woman, doubtless, in 
 thus showing her contempt for the kitchen, imagines that she is 
 proving herself to be on a higher plane in the social scale than 
 her sister who knows the mysteries of the preparation of food. 
 It would not, however, appear to be unbecoming even in the 
 mistress of a Fifth Avenue mansion, to be reasonably well ac- 
 quainted with the methods of food preparation, and no one 
 would feel that such a woman would be demeaned by knowing 
 how properly to direct her servants in preparing the food for 
 her family. 
 
 For the American woman of lesser advantages to eschew such 
 knowledge, is likely to be an affectation or the result of indo- 
 lence. Yet it is evident that American women are not well
 
 348 THE PRICE OF INEFFICIENCY 
 
 trained in household management. They regard it^ as an in- 
 ferior science and as undeserving of their best attention, where- 
 as the art of housekeeping is one that is of the first importance 
 in the economy of national life. 
 
 The American woman is not good at purchasing supplies. 
 The idea of going to market in the early morning hours is far 
 from her idea of her mission on this temporary sphere. It suits 
 her much better to take her coffee in bed and serve canned 
 beans for dinner and to devote her leisure moments to suffraget- 
 ting and writing essays as to why matrimony proves inadequate 
 to cope with modem conditions. 
 
 It is never the boast of an American housewife to her guests 
 that a meal has cost less than a certain sum to prepare, or that 
 she has run her table within the week at a certain low figure. 
 If anything, she is more than anxious to say how great the cost of 
 the meal has been, and how expensive certain of its dishes. This 
 is due, in a certain measure, perhaps, to the spirit of hospitality, 
 but more to the spirit of spending a dollar largely, and in the 
 grand manner of the millionaire. 
 
 Conditions that now exist are a sufficient answer to this sys- 
 tem of housekeeping, a system perhaps the most inefficient that 
 could well be devised. Abroad, the mistress of the house is 
 thoroughly schooled in all the arts of domestic economy, and it 
 is a matter of pride with her, to know how to prepare a cup of 
 coffee, as well as more complicated dishes. She is likely before 
 a friend who is a guest to boast how little the meal just finished 
 has cost, and this does not show lack of hospitality, but is proof 
 of the skill and thrift of the hostess, good evidence of which has 
 just been despatched. It shows that much pains has been taken 
 though no great expense has been gone to. 
 
 It is customary in America to compliment the hostess on the 
 delicious quality of the meal, whether it is in reality delicious 
 or only an assortment of snacks. This is a form of politeness 
 which does not prevail abroad, where the housewife would re- 
 sent such elaborate compliments, in much the same way that an 
 American woman would the customai-y German salute of lifting 
 the hat so low that it is upside down. It would seem to her to 
 be over done. On the continent, the principal compliment paid 
 the hostess is in refraining from using pepper and salt, at least 
 openly, as such a use of condiments she takes as a criticism of 
 her ability to properly season the food. 
 Many American women, will, however, boast of the excellent
 
 CUTTING OUT THE MIDDLELIAN 349 
 
 results they have obtained with small expense in the way of 
 clothes, and it is in this same spirit that the woman abroad 
 speaks of her table expenses. 
 
 The lack of proper interest in the table is one of the chief 
 causes of high prices of living, as the failure to utilize in an 
 appetizing way, the cheaper but equally wholesome and appe- 
 tizing foods, creates a demand for the more costly grades, which 
 forces them to still higher levels. 
 
 The ignorance of American women in the art of food prepara- 
 tion, causes them to resort constantly to canned preparations, 
 M'hich though convenient, are both costly and unwholesome and 
 a grave injury to the health of any family in which they are 
 consumed to any extent. To cure the evils thus arising, we 
 transform ourselves into a nation of pill eaters, and drug stores 
 are among the most profitable and numerous of all American 
 industries. 
 
 American ignorance of food preparation, caused Thomas A. 
 Edison, the noted inventor, to say that the French could live 
 on the foods that we waste. Mr. Edison was particularly de- 
 lighted with the bread which he found abroad, which is due to 
 the skill of the housewife and baker. 
 
 The French housekeeper, understanding the art of food prep- 
 aration thoroughly, is able to combine ingredients in such a 
 manner as to produce wholesome and appetizing dishes from 
 materials which used singly have little culinary interest. The 
 American woman if she knew how to make good dishes, would 
 take pride in preparing them, and would find them for herself 
 as well as for her family, tasty and healthful; but not knowing 
 how to prepare them, she remains in blissful ignorance and 
 really believes the advertisements so glaringly displayed of the 
 tastiness of canned goods. 
 
 American women must take a greater interest in cooking, not 
 only for its own sake, but for the good of society. Constantly 
 increasing prices have made it necessary for her to turn her 
 attention towards the kitchen, if she is to have any money left 
 to buy rugs and phonographs for the parlor; and the operation 
 of consumers' unions ofEers one of the simplest and most im- 
 mediately applicable expedients for cutting down the cost of 
 living. 
 
 Such consumers' unions operate on a most extended scale in 
 Europe. In Germany, there is a central union with over 2,000 
 branches. There are also renting unions, for protecting the
 
 350 THE PRICE OF INEFFICIENCY 
 
 interests of tenants against house owners and landlords, while 
 there are a large number of building and loan societies and 
 credit unions along the same lines. 
 
 The local members of a consumers' union pay annual dues of 
 about five dollars. The members at their annual meeting elect 
 directors and officers to carry on the work. The officers may 
 only act in a supervisory capacity over paid employees, or they 
 may act as managers, making it their whole business and re- 
 ceiving suitable salaries for the work. The members also hold 
 montlily meetings, and discuss the work of the officers of the 
 union, market prices, methods and complaints. 
 
 The central body of the unions issues a weekly bulletin, or 
 newspaper, which is a quite important phase of the movement. 
 It gives the market prices, general news of interest to members, 
 discussions and reports of the work of the various local unions 
 comparing their methods and showing how improvements may 
 be made. Numerous cooking receipts are given of a timely na- 
 ture, showing how to utilize the foods in season at such times 
 to the best advantage. It also gives information as to the con- 
 dition of crops and indicates which foods are likely to be plenti- 
 ful and which scarce later in the season. It tells the proper 
 time for placing orders for foods and supplies so that the con- 
 sumer may order at the most favorable moment. Not only the 
 current prices are given, but also the probable prices at later 
 periods of the year, based on the supplies in sight and the nat- 
 ural increase and decrease. This enables the consumer to 
 determine whether to lay in supplies or wait until conditions 
 change. It acts as an incentive to careful management and 
 keeps the consumer constantly informed on subjects that he 
 would ordinarily fail to give proper attention to. 
 
 The placing of orders by members at the proper time facili- 
 tates the work of the unions since it enables them to gauge the 
 probable demand of their members and to place orders for the 
 required amounts; thus saving any risk of over or under supply. 
 
 The unions knowing what the requirements of their members 
 will be, are able to place orders at any time for certain amounts 
 of various commodities, to be delivered later in stated quan- 
 tities at stated intervals and agreed prices. Thus the consumer 
 knows in advance what he will have to pay and when he will 
 have to pay it. 
 
 A characteristic consumers' union store often consists of a 
 large one-story building of the character of a market house,
 
 CUTTING OUT THE MIDDLEMAN 351 
 
 with a large open space in the center. Around the sides are 
 arranged various counters, devoted each to a separate class of 
 commodities, a counter for meats, one for rice, flour, etc., an- 
 other for fruits, another for vegetables, another for wines and 
 liquors and others for clothing and haberdashery, as the con- 
 sumers' unions include also wearing apparel as well as foods 
 and household commodities. Even bicycles and hardware, 
 dishes, cutlery and kitchen utensils are included. 
 
 The consumers' unions are particularly popular with the 
 working classes, though by no means confined to them. Since 
 to become a member only involves the payment of the initiation 
 fee, which is small, most of the families living in a neighbor- 
 hood where there is a consumers' union store will become mem- 
 bers of it. As there are many branches, a move only means the 
 transfer from one branch to another of the same general union, 
 without paying a new initiation fee. 
 
 It is customary, early in December, for the consumers' unions 
 to declare a rebate or dividend out of the profits of the year, 
 and this is the measure of the efficiency of the organization. It 
 is given at that time in order that the members may have the 
 money to utilize for Christmas purchases. The distribution is 
 in accordance with the volume of purchases of the individual 
 members. Track is kept of this in the method of making pur- 
 chases, as each member is provided with a small book which is 
 taken to the store whenever a purchase is made. The salesman 
 marks the amount of the purchase in the book and this forms 
 the record on which, at the end of the year, the amount of the 
 customer's rebate is figured. The larger his purchases the 
 larger will be the amount of his rebate, although the rate of it 
 will be the same as the rate of a smaller consumer. 
 
 During the year, should the consumer remove to another part 
 of the country, the same purchasing book may still be used. 
 Members are also privileged, when there are different stores in 
 the same city, to purchase at will from any of them with the 
 same book. As the clientele of each store varies with its loca- 
 tion, some having goods of a higher quality than others, con- 
 siderable advantage may be taken of these differences. 
 
 As the local unions work in conjunction with the credit 
 unions, the consumers may in this way obtain a certain amount 
 of credit. 
 
 An interesting feature of the stores is that all the members 
 have the same treatment in the selection of goods. The largest
 
 352 THE PRICE OF INEFFICIENCY 
 
 apples do not appear at the top of the barrel, nor are the goods 
 picked over. Each purchaser takes the regular run of goods, 
 and no one is shown any special favors, nor is any extra meas- 
 ure given. The consumer, indeed, being in effect a part pro- 
 prietor of the store, would be the first to object to too full a 
 measure since he would reflect that others were probably receiv- 
 ing the same if not greater favors. There is thus no bargaining 
 between clerks and customers and the business is transacted with 
 the least delay and annoyance. Indeed, a child may be sent to 
 market with the assurance that just as good results will be 
 obtained as would be by an adult, and in the same way, tele- 
 phone orders may be given with equal confidence. This is a 
 considerable relief to the German purchaser, who ordinarily takes 
 particular care in the inspection of his purchases, often in 
 butcher shops even selecting the meat and seeing the chopping 
 performed before his own eyes, when his mouth waters for a 
 Hamburger steak. 
 
 Among the methods whereby the system of consumers' 
 unions could be introduced in the United States, several have 
 considerable value. Only experience, however, will demonstrate 
 which are the most feasible and best adapted to succeed under 
 the conditions of American life, character and customs. It is 
 ob^^ous, of course, that no large system could at once be intro- 
 duced with branches all over the country, so that it is essential 
 to begin the plan in some small way. The method which finally 
 becomes the one most followed will have to be the one that ap- 
 peals most strongly to many different people in different local- 
 ities, and one which excites the initiative of the members and 
 causes them to institute it in a more or less spontaneous manner. 
 There can be no doubt that consumers' unions will soon appear 
 in the United States. They are an absolutely necessary ex- 
 pedient for cutting down the cost of living, and the only ques- 
 tion is what plan will prove most adaptable. 
 
 One form of consumers' union may be put in operation very 
 readily. It involves the formation of a consumers' club and 
 the co-operation of certain dealers in a neighborhood, a grocer, 
 a baker and a butcher. Later a delicatessen and a drug store 
 would be added. The club being formed, the initiation fees 
 would serve to defray the cost of a supply of brass checks, serv- 
 ing as the coinage of the club, and the members would obtain, 
 for example, eleven dollars worth of checks from the club for 
 ten dollars in money. Used by the members, such checks would
 
 CUTTING OUT THE MIDDLEMAN 353 
 
 be accepted by the stores, and at the end of each business day, 
 the stores presenting the checks they had accepted during the 
 day from the members to the club treasurer, would receive the 
 agreed value in cash. 
 
 The benefit to the members in such a plan would be that they 
 would obtain a 10% reduction in the cost of their goods, while 
 the stores would be enabled to take trade away from rival deal- 
 ers, and being assured of the patronage of the club, would gain 
 as much at the end of the year, through a larger volume of busi- 
 ness at a lower profit as they would under the previous state 
 of open competition. They would also be doing a cash business. 
 The effect of this plan is to reduce the profits of the stores not 
 in the union, or even to wipe them out entirely, in which case 
 a neighborhood which was first served by a large number of 
 stores, without increasing its purchases, comes to be served by a 
 fewer number of stores. Thus the cost of distribution, which 
 is the only proper cost of the middleman, is reduced by wiping 
 out superfluous stores. 
 
 Should any of the stores patronized fail to supply the quality 
 of goods desired, the club could readily transfer its members to 
 another store. This would prevent any deterioration in quality 
 or service. The brass checks being a cash transaction would 
 not only be to the dealer's advantage, but would be to the ad- 
 vantage of the cash customer, who under the present system 
 must pay as much for his goods as the purchaser who obtains 
 his goods on credit, and often never pays. 
 
 An additional cheapness would result should the grocer be 
 relieved of the cost of deliveries, which is an item that raises the 
 price to the consumer. 
 
 A noticeable example of the saving to customers due to cash 
 business, sales without deliveries and freedom from bookkeep- 
 ing expense and collections is seen in the great values given by 
 ten cent stores. The application of the club check system just 
 described would give the members a grocery, bakery and butcher 
 shop utilizing the principles of the ten cent store plan. Stores 
 patronized by the club would also have no need to advertise, 
 another important saving. 
 
 Such stores could also be located in much less prominent and 
 expensive places, saving high rents now paid for positions of 
 advantage. The public would in this way effect great savings 
 for itself, as owing to its carelessness as to where it makes its 
 purchases and its tendency to save a few steps and drop into
 
 354 THE PRICE OF INEFFICIENCY 
 
 the avenue store instead of going around the corner to the street 
 store up the block, places a high, fictitious and altogether un- 
 necessary value on real estate, the rent of which eventually 
 comes out of its own pocket in the costs of the articles it buys. 
 
 Prices are the greatest of commercial magnets. Department 
 stores through lower prices draw patrons from distant parts of 
 the citv and even adjoining cities, who would otherwise pur- 
 chase nearer home if not tempted to take the journey by the 
 lower prices offered. Members of a consumers' club could be 
 depended on to go even considerable distances to take advan- 
 tage of their brass money. 
 
 A somewhat different form of organization could be effected 
 by bringing together the proprietors of a number of boarding 
 houses and restaurants, and establishing a central depot in 
 charge of a purchasing agent. At the close of each day's busi- 
 ness, the members would put their orders in for the next day's 
 supplies, and the purchasing agent would then visit the princi- 
 pal markets of the city and procure the supplies in bulk for 
 delivery to the depot, thus securing wholesale prices. For 
 staple articles the orders would be placed somewhat in advance, 
 which would enable the purchasing agent to act as a commis- 
 sion merchant in placing orders direct with farmers. Antici- 
 pating to a certain extent, the needs of the members, the depot 
 would carry in stock certain staple lines of goods which could 
 be drawn upon at will by the members. Starting in this man- 
 ner, the club could readily be extended to include the smaller 
 purchases of householders, and the depot could be enlarged and 
 provided with a more complete line of goods until it came regu- 
 larly into competition with stores of a similar character. 
 
 The advantage of this plan is that the purchasing agent would 
 be free to buy where he found the best prices, and would be 
 able to take advantage of any special inducements of sellers. 
 "Working on a cash basis, the purchasing agent would be able to 
 secure the lowest prices. 
 
 A certain leeway should be given the purchasing agent, as to 
 the times of purchasing certain articles, in order to obtain the 
 best terms and he should be allowed to purchase at his discre- 
 tion goods of any character, when particular bargains were 
 offered. 
 
 The depot could be made to serve as an afternoon market for 
 special articles at special prices, open to the members and to 
 the public as well, but the members would be entitled to certain
 
 CUTTING OUT THE MIDDLEMAN 355 
 
 discounts not allowed the general public, although the prices to 
 the latter would be considerably lower than regular commercial 
 prices. 
 
 A considerable factor in the success of the plan would lie in 
 the energy, experience and business ability of the purchasing 
 agent, who should be given a good salary and a commission, as 
 an incentive to him to build up the business of the club. It 
 should not be difficult to secure competent men, as the club 
 would furnish the working capital in the form of dues and 
 cash payments and the manager of a large club would gain for 
 himself greater profits without the risk of any capital than he 
 would as a dealer with his own money invested in his business. 
 He would thus be commercially the superior of any of the deal- 
 ers with whom he came in contact, and consequently would not 
 be placed at a disadvantage. 
 
 Consumers' clubs could also be organized on a smaller scale 
 even with only five or six members. The purchasing agent in 
 such a case could make two calls daily if necessary on the mem- 
 bers, a morning call for the orders for the main produce sup- 
 plies of the day, and a later call for smaller supplementary 
 orders. The purchasing agent could make her headquarters at 
 some convenient point, using a parlor for an office, and might 
 even herself be a boarding house keeper. She should have a 
 suitable conveyance, and collecting the orders, would then go to 
 the most favorable market, order at the butcher's half a dozen 
 cuts of meat, at the baker's the required bread and pastry and 
 at the grocer 's the necessary staples, fruit and vegetables ; there- 
 after having the goods delivered in her own wagon. In this 
 way, the dealers would not know who the customers were. Her 
 accounts would be kept for the club, and it would be her object 
 to derive her income from her work. With small effort she 
 could build up a club which would be very profitable. A great 
 saving to the consumers would result through freedom from 
 the labor of going to market, as the purchasing agent could at 
 a single visit, with a few extra minutes of time, do the work of 
 all the housekeepers. 
 
 Such a purchasing agent could also, with advantage, suggest 
 bills of fare in keeping with the season. On the afternoon 
 round, she could deliver proposed bills of fare, to enable the 
 housekeepers to plan the next day's fare. 
 
 In connection, also, with such a consumer's club could be 
 operated a general kitchen, in which pies, cakes and bread of
 
 356 THE PRICE OF INEFFICIENCY 
 
 the best quality could be prepared. The impossibility of secur- 
 ing first class products of the baker's art under present condi- 
 tions, should make such kitchens highly popular. The kitchen 
 could also cook roasts, chickens and articles difficult to prepare 
 at home, and the menus of the various members would be pre- 
 pared with a view to having such cooked goods delivered to 
 them at the proper hours. Such a collective kitchen, with ex- 
 pert help, would soon make the club practically a necessity to 
 the members and would make it profitable to all concerned. 
 The superiority of such a plan over the delicatessen store lies 
 in the fact that no loss would occur through unsold orders since 
 everything cooked would be ordered in advance, and no waste 
 would result. This is a plan that would be of especial in- 
 terest in New York and other large cities, where it could be con- 
 ducted on a scale of some magnitude in an apartment house 
 block, particularly by the arrangement of the entrances from 
 the center of the block and a system of local telephones. 
 
 Organizations of the character indicated are lacking in the 
 United States, largely because of the lack of initiative and col- 
 lective action. The responsibility of conducting such clubs 
 needs to be on the shoulders of the club itself, and the manager 
 should not be expected to keep the organization together as well 
 as to conduct its business. Women with business ability, how- 
 ever, looking for new occupations, should find the present time 
 one particularly propitious for undertaking such work, and it 
 Avould appear to be a form of club that could be very success- 
 fully managed by women with weekly afternoon meetings. It 
 would be, in the large cities, a new social force, bringing to- 
 gether neighbors into a new contact, in a manner which does 
 not now occur. It would certainly be a form of activity as 
 u.seful as suffragette meetings, and one that would produce a 
 much more favorable effect on the family finances. 
 
 The effect, too, would not only be financial, but also ethical, 
 since it would ser\'e to unify the life of the family. The wife 
 would be more interestedly occupied with the affairs of the 
 household, and the cheapening of the food would enable her to 
 procure for the same outlay a better quality, or the same quality 
 at a lower price. All the members of the family would be bet- 
 ter satisfied, contented and better nourished for the battle of 
 life. The family would accordingly be a stronger unit than at 
 present, when every increase in prices operates to destroy and 
 disrupt it.
 
 CUTTING OUT THE MIDDLEMAN 357 
 
 The plans indicated, are, of course, only suggestions of the 
 most general nature, and numerous others could be suggested, 
 but enough is shown to indicate the great possibilities of collec- 
 tive action exerted in this way. The price of food to-day in the 
 United States is not only an economic, but also a political ques- 
 tion, and it is easy to see the great results that might be accom- 
 plished by a well organized system of consumers' unions, oper- 
 ating all over the country. 
 
 Our individualistic method of purchasing, in which every 
 purchaser is the competitor of every other purchaser, and all 
 are indifferent to the interests of the others, results in their 
 exploitation by the middlemen, and this has reached such a 
 point that only about one-third of the price paid by the con- 
 sumer reaches the producer. This is a startling price to pay 
 for our inefficiency and unorganized methods of purchasing.
 
 CHAPTER XXIII 
 PUBLIC WELFARE 
 
 Nervous crystallization of Americans — Great sum total of inflictions — The 
 five senses and what they have to endure— Making the streets hideous 
 at night — How extravagance is encouraged — How the ear is scourged 
 —The great vogue of the flat wheeled street car— Unbounded energy 
 with which the automobile makes itself disagreeable and dangerous — 
 The call of "huxtra!" — The tobacco hog — Disease hazards of street 
 car travel — How to make money out of refuse destruction — Garbage 
 gathering under modern conditions — What the sense of taste has to 
 endure — Old meat and fresh bread vs. fresh meat and old bread — 
 Hot and cold foods— Dinner generally a bad job — What a rectifier 
 of spirits "rectifies."— Bottled in bond liquors— Soda fountain mys- 
 teries — Drug frauds— Murder for a quarter of a cent profit — Psycho- 
 logical effect of mal-nutrition — Effect on children of immigrants— 
 What happens to the sense of touch— Violent changes of temperature- 
 Inefficiency of the police — How the German police get a culprit within 
 three days — Dealing with minor infractions — Luxurious ways of the 
 American wife and premature age of the husband — The system of 
 official complaints— The public on the job abroad— Impositions of 
 builders and contractors— Offenders of the streets — Hypocritical 
 policy of dealing with the oldest of professions — Cost of the abolition 
 of tlie canteen — Terrible consequences to the soldiers — Appalling sys- 
 tem of effects of the policy of the whitened sepulchre — ^The sins of 
 the fathers — Inefficiency of moral courage. 
 
 Among the adverse factors with which the engineer has to 
 contend in his designing is crystallization, which is caused by 
 long continued minute vibrations, and which ultimately makes 
 metals so hard and brittle that they break under very small 
 strains. 
 
 The American public itself is largely a victim of nervous 
 crystallization. The continual annoyances to which it is sub- 
 jected produce minute vibrations in the special senses. The 
 sight is afflicted, the hearing, taste, touch and the sense of smell, 
 and the total of the various annoyances creates a breaking strain 
 which has endless consequences. 
 
 The term, public welfare, conjures up ideas of great public 
 principles, issues, or large works, but the aggregate of the 
 
 358
 
 PUBLIC WELFARE 359 
 
 smaller inflictions which are endured by a long suffering pub- 
 lic, amounts to a total far in excess of even the greatest of single 
 questions. 
 
 Annoyances of such a character are utterly unnecessary. 
 They should not be tolerated, being for the most part so readily 
 remedied. Yet year in and year out the same conditions con- 
 tinue, and what is everj^body's business, being nobody's busi- 
 ness, such abuses multiply and are never corrected unless some 
 strong, selfish interest finds a profit in bringing about a change. 
 
 The eye is subjected, first of all, to a multiplicity of inflic- 
 tions. At night the streets are either poorly lighted, or else 
 glaring advertisements in illumination are continually flashing 
 on and off. These are made to create as violent an optical im- 
 pression as possible, and are usually illustrative of some ex- 
 cessively vulgar or commonplace advertisement. 
 
 The private owners of the buildings on which these unsightly 
 abominations are placed, derive rentals reaching the proportions 
 of small fortunes annually. Commercial considerations thus 
 place a high premium on setting us as glaring a nuisance as can 
 be devised. 
 
 While the now-you-see-it — now-you-don 't electric sign is one 
 of the greatest nuisances which afflicts the sight, it is by no 
 means the only one. Advertisements generally on signboards 
 are crude in an artistic sense and cheap in every sense. Yet 
 great sums are wasted annually in such devices, involving all 
 sorts of evil consequences. Not only are the advertisements 
 costly to erect and maintain, but they induce the public to buy 
 goods for which ordinarily no desire would be experienced. 
 Such advertisements are thus an encouragement to extrava- 
 gance. The excessive expenditures which the public are thus 
 tempted to make, through such glaring advertisements, cause dis- 
 content, and the ceaseless endeavor to excel their neighbors in 
 expenditure thus stimulated is a fruitful source of social un- 
 rest. 
 
 Mayor Samuel Lewis Shank of Indianapolis, at the 1912 
 meeting of the New York State Agricultural Society at Albany, 
 described this condition. 
 
 "Seventeen years ago, the father of a family paid $12 for 
 a suit of clothes, had a $40 horse with no pedigree, a $30 buggy 
 with steel tires, a $6 set of harness, a $35 cow which gave five 
 gallons of milk a day, twenty-five-cent chickens which laid every 
 day and a good watchdog which cost nothing.
 
 360 THE PRICE OF INEFFICIENCY 
 
 "The son to-day expends $40 for a suit of clothes, $5 for 
 shoes, $4 for a hat, $2.50 for a shirt, wears a white collar every 
 day with cuffs, the buttons in which cost $20, owns a $300 horse 
 with a pedigree longer than his list of relatives, $125 buggy 
 with ball bearings and rubber tires, a $30 set of harness cov- 
 ered with brass, a $100 cow with a great pedigree, but who gives 
 but half a gallon of milk at a milking, hens costing $1.25, and 
 a dog with a pedigree, which cost $10. 
 
 "In household furnishings, to-day a $200 range takes the 
 place of a cook stove, and a $300 rug the place of a rag carpet 
 mat. In olden times the family went once a year to see 'Uncle 
 Tom's Cabin,' at small cost. To-day it goes to the theater 
 twice a week at $3. Seventeen years ago there was a family 
 dinner with plain fare but to-day dinner is served at a big cost, 
 served by waiters and the guests are sent home in taxicabs. In 
 olden times nearly everything was prepared in the home, to-day 
 it is nearly all purchased outside of the home." 
 
 Advertisements, it may be readily seen, are one of the causes 
 of this increased era of extravagance. 
 
 Among other serious afflictions of the eye, which cause grave 
 injury, is the method of collecting street refuse in open carts. 
 Numberless pedestrians passing through clouds of dust, come 
 off decidedly the worse for the experience, yet it continues as 
 a permanent feature of city life, when it might be easily ob- 
 viated by closed sanitary carts. 
 
 Street railways have a similar disregard for the sight of their 
 patrons, in their lighting systems. The use of additional power 
 frequently dims the lights, while at crossings and switches the 
 lights go out entirely. This annoyance is a traditional one 
 and in all probability will remain a fixture of street car travel. 
 
 The ear is afflicted even more than the eye. The variety and 
 number of city noises is so great that an unrealized nervous 
 strain is continually undergone which contributes to neuras- 
 thenia and nervous breakdowns. 
 
 Among the preventable but exceedingly aggravating city 
 noises is the flat wheeled trolley ear. A flat wheel is caused by 
 improper application of the brakes, causing the wheels to slide 
 along the rails and wear a flat spot, which at each revolution 
 makes a pounding noise. A flat wheel may readily be remedied 
 by being put in a lathe and having its diameter reduced slightly 
 to the bottom of the flat spot, but this involves expense, which 
 is evidently more disagreeable to the company than the noise
 
 PUBLIC WELFARE 361 
 
 is to the public, since the lesser evil is always the one endured 
 and the continuance of the flat wheel must prove it to be the 
 lesser evil. 
 
 Another of the noises which afflicts the ear of the unoffending 
 city dweller is the automobile horn. This nuisance is wide- 
 spread and intensive. It exists in 500,000 varieties, that being, 
 according to the latest statistics, the number of automobiles now 
 at large. These noises range from a mild mannered croak to 
 the shriek of a hyena, and interspersed are a wide variety of 
 explosive sounds, caused by popping tires, exploding mixtures, 
 muffler cutouts, back fires and pre-ignitions and the various 
 other ills which an automobile is heir to, most of which produce 
 some kind of a noise. 
 
 By a wise provision of nature, however, the automobile is not 
 subject to flat wheels, otherwise life in a community of automo- 
 biles would be unendurable. The worst that an automobile can 
 do with its wheels is to run over the bystander, or slap a loose 
 chain against the fender. 
 
 By an equally wise provision of nature, trolley cars have not 
 adopted horns, remaining content with bells and flat wheels. 
 There are many things, thus, which the city dweller has to be 
 thankful for. 
 
 Another nuisance which is confined to the larger cities is the 
 shouting of extra editions of newspapers. Particularly in New 
 York is this infliction systematically practiced. The custom is 
 for two or three leather-lunged, rawhide-tongued newsboys, 
 some twenty-five or thirty years of age and strong enough to 
 lift the Flatiron building between them, to suddenly invade a 
 street, making night hideous with their cries. They seem well 
 satisfied if they sell a single penny paper for five cents for each 
 block shouted-up, for the public is pretty well immune, having 
 long since discovered in most cases, that the contents of the 
 newspapers so sold have appeared in earlier editions the same 
 day, or relate to some minor occurrence in a distant city. 
 
 The customs of newspapers in getting out extra editions and 
 special extra editions on the slightest pretext has destroyed any 
 interest in them. It is the old cry of wolf too often repeated. 
 
 Another curious phenomena of newspaper publication is the 
 timepieces used in the press rooms. Judging by the hour dates 
 on the papers, these clocks must be from three to six hours ahead 
 of all other clocks, since the four o'clock edition is usually on 
 sale before noon, while the final edition or eleven o'clock edition
 
 362 THE PRICE OF INEFFICIENCY 
 
 may still be read in daylight. The calendars in the weekly and 
 monthly periodical offices are not to be outdone by the news- 
 paper press room clocks. They are, indeed, even mere fore- 
 handed, for it is a very backward Saturday paper that cannot 
 be purchased on Thursday and a poor Christmas number that 
 is not on the news-stands before Thanksgiving day, and forgotten 
 
 by Christmas. 
 
 Compared with the eye and the ear, the nose of the city dweller, 
 at first glance appears to get off very lightly. It is true that 
 the odor of politics is regularly much and evilly in evidence, 
 but this is an old and familiar smell. 
 
 The automobile again furnishes considerable nasal diversion, 
 with its exhaust, largely due to the carelessness of chauffeurs 
 in regulating and cleaning their motors, and in the failure to 
 use a good quality of oil. 
 
 The sense of smell, however, finds a more annoying enemy in 
 the tobacco habit, so widely prevalent in America. Although 
 many street railway companies forbid smoking, except on the 
 "four rear seats" the smokers are apparently illiterate when 
 it comes to counting seats. Many lines go further and forbid 
 entirely the smoking or carrying of live cigars, but they fail to 
 make any provision as to dead ones, which are vastly more 
 offensive. 
 
 The ventilation of street cars and other public conveyances 
 in America is a fearful and wonderful thing. Either the blasts 
 of the Arctic are blown through, or the car becomes an amateur 
 black hole of Calcutta. Any systematic plan or idea of ventila- 
 ting cars is utterly beyond the furthest reaches of the imagina- 
 tion of a traffic manager. On street railways any intelligence 
 that a conductor might exhibit is dispensed with by the fixing 
 of the heating and ventilating devices before the car starts out, 
 and the conductor is as helpless as a passenger to make any 
 change. 
 
 "While each individual suffers but a portion of each day, and 
 will not take the trouble to object to the imposition Avhich 
 springs from the carelessness and greed of the companies, the 
 total amount of inconvenience and discomfort endured by the 
 traveling public, and the number of cases of disease incubated 
 in the cars is enormous. It could all be remedied by a little 
 sharp, united action, but there appears no prospect of any such 
 millennium. 
 
 The nose of the city dweller also suffers from the method of
 
 PUBLIC WELFARE 363 
 
 collecting garbage which so offends the eye. The garbage re- 
 mains in exposed cans on the sidewalks until the garbage cart 
 comes to scatter part on the street and take what is left to the 
 dumps. The latter is an unsavory locality, but one that is 
 wholly unnecessary, as cities may make it a source of profit by 
 the erection of refuse destruction plants. Garbage dumps are 
 a menace to the public health and ruin whole sections of the 
 city. Indeed, taking into consideration public dumps, slaugh- 
 ter houses, chemical factories, metal foundries, tanyards, ren- 
 dering plants, cellar gratings, garbage cans, beer saloons, dirty 
 gutters and other sources of vile odors, a large proportion of 
 every city is uninhabitable and highly disagreeable and dan- 
 gerous. With proper regulation this need not be the case. 
 
 Perhaps the most intolerable condition which can exist in any 
 city is that created by a garbage gatherers' strike. While accord- 
 ing to the venerable proverb, the water is never missed until 
 the well runs dry, it is far truer that the garbage is never vio- 
 lently noticeable until it is not missed. When the garbage men 
 strike they are realized to be among the most absolutely neces- 
 sary members of society. 
 
 The installation of refuse destruction plants is a highly desir- 
 able reform. From the sanitary point of view it is the only 
 satisfactory solution of the problem of city refuse disposition. 
 Careful research both in this city and abroad has proved con- 
 clusively that disease is spread through the use of refuse dumps 
 for any kind of city waste. The decomposition of garbage 
 causes offensive and poisonous odors to be emitted. Flies in 
 millions cover the dumps, feeding on the decaying matter and 
 carrying away germ laden matter in the particles of filth on 
 their feet and bodies, which are deposited upon the food and 
 skin of human beings when the flies light upon and crawl over 
 them. Thus the harmful germs enter the human system and 
 contagion spreads the disease. Refuse is sure to contain some 
 disease germs. Poor families frequently do not call in a doctor 
 until the patients have been ill for a long time, and all clothing, 
 paper, etc., near them is apt to become infected. This infected 
 stuff when thrown on the dumps is sure to be picked over by 
 other poor people, in spite of the most careful regulations to 
 the contrary, and the new possessor of his family is almost cer- 
 tain to become infected. Beds and bedding are frequently 
 thrown away after a patient has recovered from a contagious 
 disease, without proper fumigation, and these are morally cer-
 
 364 THE PRICE OF INEFFICIENCY 
 
 tain to fall into the hands of the poor, spreading disease among 
 them. If ashes could be kept clean there would perhaps be 
 little danger to health from disposing of them at fills and 
 dumps, but as household ash always contains some garbage, it 
 should also be burned to make it entirely innocuous. 
 
 There are still other sanitary reasons for the use of this sys- 
 tem. Ashes carried alone in carts cause dust to fly about to 
 the detriment of people's lungs, eyes and clothing, while sepa- 
 rately collected garbage emits odors, and is apt to drip infected, 
 unclean fluid in the streets. The collection of both ash and gar- 
 bage in the same carts is advisable, since the ash absorbs the 
 moisture and both dust and drip are eliminated. Rubbish, 
 ashes and garbage can all be collected at the same time in the 
 same carts, reducing expense. Filled land, made up largely of 
 mixed refuse, is liable to cause spontaneous combustion when 
 built upon, adding a fire hazard of a dangerous sort. The 
 health and welfare of a city, which should be its chief consider- 
 ation, require that all refuse should be purified by burning be- 
 fore finally being disposed of. 
 
 Destructors produce steam and clinker, which in most cases 
 can be sold at a good profit. Roughly speaking, a destructor 
 burning ordinary garbage will give steam enough to light the 
 city streets, thus saving the amount paid for this purpose. Or 
 it will heat the city or run the water works, including the aver- 
 age amount of pumping. The vitreous clinker makes a high 
 grade of building concrete, paving slabs or brick. 
 
 ]\rodern engineering methods enable the refuse destructor 
 plants to accomplish their work and to consume their own gases 
 and smoke, so that no nuisance whatever results. The system 
 of destructors is far superior to any other means of refuse dis- 
 posal and its adoption by all cities would prove a great sanitary 
 improvement. 
 
 The sense of taste of the American, both of the city and the 
 country^ dweller, suffers together with his other special senses. 
 To deceive the taste, a complicated chemical industry has grown 
 up, which resorts to the uses of a wide variety of drugs and 
 chemicals as adulterants. It is indeed difficult to obtain any 
 kind of food in the United States which is not subjected to 
 adulteration or treatment at some stage in its progress from the 
 producer to the consumer, and although national and state laws 
 of a stringent character exist, they do not seem to effect the 
 remedies desired.
 
 PUBLIC WELFARE 365 
 
 The public itself is very careless and even when, in accordance 
 with the law, the label of a food article bears the notice of the 
 presence of a chemical or an adulteration, the purchaser does 
 not either take the time to look into the matter, or does not un- 
 derstand the true meaning of the long, technical name given to 
 the adulterant or preservative. 
 
 The carelessness of the public in respect to its own health 
 needs to be remedied before any substantial improvement can 
 be expected from the manufacturer and dealer in foodstuffs. 
 The American exhibits the utmost carelessness in regard to his 
 food, not only as to its purity and quality, but in the way it is 
 prepared and ser%'ed, and the strange juxtapositions that he 
 makes in his bill of fare. 
 
 It is the custom of the American to eat fresh bread and old 
 meat, the latter shipped halfway across the continent and held 
 in cold storage, perhaps for several months. The bread, how- 
 ever, is always hot out of the bakeries which are located in con- 
 venient places. Freshness, however, seems to be the only quality 
 demanded in bread, for if it is not eaten when fresh it can 
 never be eaten. The bakeries are almost without exception 
 operated in an unsanitary manner and the system of inspection 
 of bakeries is either lacking or totally inadequate. For the 
 most part they are located in basements with Little or no ventila- 
 tion, and they are by no means inviting looking places. Recent 
 disclosures of trafiSc in rots and spots, that is eggs which have 
 long since passed their period of sanitaiy usefulness, go to show 
 what ingredients are employed by the bakeries in the manu- 
 facture of bread and pastry. The latter is usually very cheap, 
 which is not to be wondered at when the nature of its contents 
 are known. 
 
 Hot bread is admittedly one of the most injurious of foods, 
 yet Americans not content alone with bread still warm from 
 the bakeries, are fond of biscuits, taken right out of the oven, 
 and of a leathery-like disc of bread like material known as a 
 pancake or griddle cake, eaten as soon as possible after leaving 
 a hot plate or iron and saturated with syrup manufactured 
 with acids deviously. This mass is washed down with ice cold 
 water, after which the American feels ready for the days busi- 
 ness. 
 
 To top off his dinner, he takes a dish of ice cream, followed 
 by hot coffee. The disorders of the stomach thus produced 
 affect the teeth and result in the art of dentistrv reachiao- a
 
 366 THE PRICE OF INEFFICIENCY 
 
 high state of development. The American dentist has a great 
 reputation, but while his skill is commendable, the state of affairs 
 which gives rise to that skill is by no means one upon which the 
 public can be congratulated. 
 
 If Americans followed the custom abroad of having slaughter 
 houses in every city, and of eating fresh meat and stale bread, 
 there would not be so much prosperity among the dentists and 
 the undertakers and the American would be a different person 
 in many respects. 
 
 The art of cooking is almost an unknown art in America. 
 Owing to adulterated foods, the cook gets a bad start, and but 
 little effort is made to catch up with the procession. In cities 
 where great chains of restaurants have sprung up, cooking is 
 carried on in wholesale and destructive manner and palatable 
 foods are made an impossibility. 
 
 America suffers too, from the fact that her foodstuffs grow 
 too rankly, and lack the fine flavor which the European food- 
 stuffs have in their natural state. 
 
 The climate and the nature of the soil, together with a high 
 state of agricultural skill, the inheritance of generations of hus- 
 bandmen, all combine to give European foodstuffs a fine flavor. 
 The cattle too, feeding on a finer quality of grass and grain, 
 provide meats of a better flavor. Added to this is the fact that 
 cooking is thoroughly understood. The European table thus 
 becomes far superior to the American, and faring better, he 
 takes more time to enjoy his food. Owing to the natural in- 
 feriority of American foodstuffs and the prevalence of adulter- 
 ation, the American cook should be more highly trained and the 
 American should devote more time to his meals. The con- 
 trary, however, is the case. 
 
 The appetite of the American must be tempted with artificial 
 condiments. One of the most noticeable of the table appoint- 
 ments is the bottle of catsup. What this really contains is the 
 most profound culinary mystery that has ever remained un- 
 solved, but veritable rivers of it are consumed in the effort to 
 make the food, tasteless in itself and poorly prepared, even 
 slightly palatable. The American usuallly eats because it is 
 time to eat, rather than because he looks forward to the meal 
 with anything like feelings of agreeable anticipation, and when 
 it is time to eat he usually eats as quickly as possible in order 
 to get through with a bad job. 
 
 He appears to have little or no concern as to what he puts
 
 PUBLIC WELFARE 367 
 
 in his mouth or the temperature of the mixture, so long as it 
 has a noticeable temperature. 
 
 It is in the saloon that the American finds the most devious of 
 all the combinations which he puts into his mouth. The liquors 
 which are dispensed, in spite of stringent laws, are concoctions 
 of the most dangerous chemicals, either mixed in the saloon 
 cellar or "blended" by the "rectifier" of spirits. The term 
 "rectifier" is one of the most respectable frauds that exists. 
 The rectifier makes it his business to mix spirits with whiskey, 
 he rectifies the spirits, that is to say, practically raw alcohol, 
 with some whiskey, and while he rectifies the spirits, what he 
 does to the whiskey had better be left unsaid. At best it is a 
 legal adulteration, but with great frequency, the product is an 
 illegal mixture of spirits, coloring and flavoring chemicals and 
 a modicum of whiskey, which while itself pure, may be of a 
 very inferior qualit^^ This mixture of the rectifier's reaches 
 the saloon where the saloon keeper subjects it to his own skill as 
 an adulterator, as a means of increasing his profits, and the 
 liquid that the gayly inclined citizen finally puts in his mouth 
 is a product of chemistry, with but a distant relation to the art 
 of distillation. 
 
 It may be said, and quite apart from any suggestion of pro- 
 hibition, that anybody who drinks anything except beer in an 
 American saloon is a dupe and a fool, and the drinker of beer, 
 while he may be getting a pure beverage, gets one overcharged 
 with alcohol and of a very inferior if not unwholesome quality, 
 often stale and invariably served at a temperature, not as regu- 
 lated by law as in Germany, but too cold for healthful assimila- 
 tion, and purposely so to disguise the taste, which would often 
 be intolerable if served at the proper temperature. 
 
 The only drink in America, whose purity is assured, is the 
 whiskey that is bottled in bond. One or more government offi- 
 cers are always on duty at every distillery and after the whiskey 
 is distilled, it is immediately placed in barrels in an adjoining 
 warehouse in charge of the government officer. Here it remains 
 under bond in the barrels until it is properly aged, and it is 
 then released by the government on the payment of the tax. 
 The barrels then go to the rectifiers, but in the "bottled in 
 bond" whiskey, the whiskey is poured into the bottles before 
 being removed from the warehouse, and the government stamp 
 is placed over the cork and neck of the bottle, so that the con- 
 sumer knows not only that the whiskey is pure but also knows
 
 368 THE PRICE OF INEFFICIENCY 
 
 when it was distilled and when it was placed in the bottle. Al- 
 though pure, its quality will depend on the skill of the distiller 
 and the nature of the ingredients, the fame of Kentucky whiskey 
 being attributable, for example, to the excellence of the water 
 used in making the mash, it being from springs in a limestone 
 formation. 
 
 It wiU never be safe to drink anything in an American saloon 
 until every drink is served from an original bottle bottled in 
 bond. The patron of a saloon under ordinary circumstances 
 not only ruins his health, but in doing so acquires a taste for 
 the raw concoctions he consumes, so that a drink of genuine 
 liquor seems tasteless and flat. Stringent laws exist against 
 refilling bottles of whiskey and if anyone cares to see a saloon 
 keeper turn pale, let him order a drink of any well known 
 brand from a half emptied bottle, and then hold it to the light 
 in comparison with a bottle of the genuine with which he has 
 provided himself. The difference in color shows the adultera- 
 tion and means a term in prison for the offender if the case is 
 pushed. The greed of the saloon keeper, however, is so great, 
 that these grave chances are constantly being run, and it is thus 
 that the law is powerless to effect a remedy in such a manner. 
 Only by taking hold at the source can adulteration be stopped. 
 
 Only less noxious are the drinks served at soda fountains. 
 What mixtures of chemicals these may be, is only known to the 
 trade. Too often they contain alcohol and an unwholesome 
 combination of acids and flavors. The same is true of ''ice 
 cream" as served in "ice cream parlors." The demand for 
 cheapness by the public and the rapacity for profits on the part 
 of druggists and confectioners who cheat in candy as in "ice 
 cream" exposes women and children to conditions as harmful 
 as those met by men in saloons. Wliat remedy there is to be 
 for this is difficult to forecast. It certainly will not be feasible 
 for ice cream to be bottled in bond or for candy to have a gov- 
 ernment stamp on each lump ; while an honest race of druggists 
 and confectioners is equally impossible. More stringent and 
 better laws and better control of the sources of manufacture 
 are needed and an extension of the system of bonded ware- 
 houses for manufacturers of foodstuffs. Greater care on the 
 part of consumers is also desirable. 
 
 Of a far more sinister aspect, however, is the adulteration of 
 drugs, perpetrated largely by the small druggist. It is almost 
 incredible, the cheapness and murderousness of the adulteration
 
 PUBLIC WELFARE 369 
 
 practiced. In prescriptions, the druggist will use an adulterated 
 or diluted article or ingredient, or ^vill, as cases in court fre- 
 quently show, substitute other ingredients, which change or 
 weaken the effect intended by the physician and confusing his 
 treatment of the case, frequently result in the death of the 
 patient. And the profit derived by the druggist from such 
 substitution is usually a most trifling amount. Cases have 
 come up in which willful adulterations were systematically prac- 
 ticed which yielded but a quarter of a cent profit, yet which 
 frequently resulted in the death of children from a dangerous 
 disease. 
 
 Among druggists the betrayal of trust of common honesty 
 with which they are charged, is not perhaps any more prevalent 
 than in any other field of business life, but in their eases the 
 results are far more serious. 
 
 The dispenser of drugs is far too mysterious in his operations. 
 He retires behind his high partitions and compounds in secret 
 his mixtures, charged with life or death for the invalid, who 
 has no more protection against the greed and rapacity of the 
 druggist than afforded by the latter 's flimsy conscience. More 
 publicity should attend the compounding of prescriptions and 
 the physician should himself be made responsible for seeing 
 that the druggist does not poison the patient. 
 
 The high screen should be done away with and prescriptions 
 compounded in the presence of the purchaser. The prescrip- 
 tions should be written in an understandable way, and the pur- 
 chaser should see that the amounts called for and the ingredi- 
 ents prescribed were actually put into the prescription. 
 
 The possession by a druggist or a drug manufacturer partic- 
 ularly, of adulterated drugs should be made a felony, for the 
 only object that can be in view in having such adulterations 
 in his possession is to cheat, and a cheat of this character is the 
 meanest, most despicable and dangerous of all cheats. 
 
 The carelessness of the public in what it eats and drinks has 
 a most serious effect on the nation as a whole. Poor and adul- 
 terated foods result in poorly nourished systems and bad teeth, 
 which in turn throw a further burden on the weakened stomach. 
 The whole body suffers from the digestive disorders and with 
 the brain no longer clear and active, the individual becomes 
 stupid, bad tempered, erratic and loses initiative and energy. 
 All business suffers, and a population so afflicted neglects its 
 rights and listens more readily to demagogues and charlatans.
 
 370 THE PRICE OF INEFFICIENCY 
 
 Swindles of all kinds flourish, respect for law and order declines 
 and a condition of disorganization and anarchy approaches. 
 The whole body politic is poisoned by the bad foods which poison 
 the individuals and the ability of the individual to secure good 
 food is correspondingly lessened. 
 
 These conditions affect most the native population, but as 
 rapidly as immigrants become Americanized, they are affected 
 in a similar manner. 
 
 Superintendent Maxwell, the head of the New York public 
 school system, is authority for the statement that foreign born 
 children and the children of foreign born parents have better 
 memories than American children. This he ascribes to a better 
 condition of the teeth and the digestion, the result of the continu- 
 ance of the foreign dietary and customs on the part of the 
 parents. 
 
 Upon becoming Americanized, however, in the second and 
 third generation, the children become so thoroughly imbued 
 with American ideas that they are ashamed of everything con- 
 nected with their foreign origin and even refuse to learn the 
 language of their fathers. All the old healthful customs are 
 forgotten or tabooed and the new Americans are soon in the 
 habits of the natives and suffer equally from carelessness and 
 waste. 
 
 Twenty years ago we were receiving a much higher class of 
 immigrants than at present, for as time passes and economic 
 conditions in America approach those of foreign countries, the 
 better class of immigrants which we once had are no longer at- 
 tracted and the flood becomes of a lower and lower quality. As 
 even the children of these low clashes of immigrants are superior 
 in memory and study to the native Americans now and to the 
 American born children of our former high class of immigrants, 
 it will be seen that when the present immigrants' children have 
 become Americanized in the next generation, a very low grade 
 of pupils will result. As a consequence, this country will no 
 longer be able to hold its own with foreign countries which em- 
 ploy better methods of nourishment and which are being drained 
 of the inferior elements of their populations, thus leaving room 
 for the better classes to expand. America is already suffering 
 from such conditions and is losing ground in the international 
 contest. A new point of view must be taken and the individual 
 nuist learn to guard his own health better, both as a duty to 
 himself and to his country. 
 
 As to the fifth sense, the sense <o£ touch and feeling, much of
 
 PUBLIC WELFARE 371 
 
 the foregoing also applies. To the experienced American, the 
 word touch carries in addition, most unpleasant meanings, as 
 he designates borrowings by that name and when he has been 
 relieved of his valuables by a pickpocket, he also has occasion 
 to use the word touch. It has thus most uncomfortable associa- 
 tions, and when the sense of temperature is included, no im- 
 provement is had. 
 
 Subjected to a climate of quick and sudden changes, one day 
 hot and the next day cold, the American had added to his un- 
 wholesome nourishment, unwholesome weather. An untold 
 amount of sickness and death results from these changes and 
 lack of preparation for them, as well as great nervous strains. 
 
 Women dress too lightly in order to be fashionable, and they 
 must draw on their nervous force merely to keep warm. If 
 they do wear warm clothing, it is in the shape of expensive furs, 
 often heavy coils around the neck, which serve more for pur- 
 poses of adornment than for protection against the weather. 
 
 Men dress with somewhat more intelligence, but they have a 
 weakness not for warm furs around the neck, but for stiff col- 
 lars, cold in cold weather and hot in hot weather and about as 
 uncomfortable a neck adornment as could possibly be devised. 
 The discomfort of this article of apparel is added to both by the 
 irritation of getting it adjusted, and by the condition to which 
 it is reduced by the laundries. These institutions employ chem- 
 icals in their operations to such an extent that linen and other 
 garments are quickly rotted out. Whether the collar and shirt 
 manufacturers control the laundries is not known, but if the 
 object of the laundries was to promote the business of the collar 
 and shirt makers, they could scarcely be more successful in their 
 destructive tactics. This is an abuse of a nature difficult to 
 rectify and can only be accomplished by rigid inspection. 
 
 In the street cars, the companies provide little or no heat and 
 passengers taking long rides are subjected to the greatest dis- 
 comforts, not alone from the freezing cold but from over- 
 crowding, and draughts through the cars from doors opened by 
 the alighting passengers and left open by the conductors. 
 
 Half frozen on the cars, the American overheats his houses, 
 especially with steam heat, which produces a dry atmosphere. 
 The transition from overheated rooms to cold cars is thus all 
 the more injurious. Sleeping rooms are also artificially heated, 
 a practice about as inimical to health as any that could be in- 
 vented.
 
 372 THE PRICE OF INEFFICIENCY 
 
 The American is subjected not only to a multiplicity of an- 
 noyances, discomforts and dangerous impositions and inflictions, 
 which may be particularly classified with reference to each of 
 the five special senses, but also to a large variety of impositions 
 which affect not only one sense, but all the senses collectively 
 and simultaneously, and if there were more than five senses, 
 means would speedily be found of harassing them, by the horde 
 of exploiters and selfish interests which confound at every turn. 
 The public is robbed, beaten and insulted on the streets at 
 all hours of the day and night, and at every turn there is some 
 scheme to defraud and deceive. Yet one of the most effective 
 measures of the European police for the protection of the public 
 is entirely ignored here, and that is the system of the registra- 
 tion of residence. In a European city, every one is required 
 to have his place of residence on file with the police. To fail to 
 do so is a crime in itself. Thus at any moment the police can 
 lay their hands on any person who may be desired. This is a 
 powerful deterrent of crime. 
 
 The European police system is vastly superior to the Ameri- 
 can system, and the certainty with which it works is so well 
 understood that the offender does not take the chances or have 
 the opportunities of the American criminal. It is an almost 
 invariable rule that a criminal is located within three days ; for 
 if an individual himself does not report his residence, the land- 
 lords of both his old and his new residence must report the 
 change within three days, as otherwise they would be liable for 
 punishment. As this includes hotels, a scrutiny of entries dis- 
 closes any discrepancies, which are speedily investigated. Even 
 should the criminal hide himself, when he comes out again later 
 on, he will betray himself by his report of where he previously 
 lived, whether it is true or false. As all discrepancies are in- 
 vestigated, the criminal has a hard time, and generally makes 
 for the boundary, where he again has a hard time to slip 
 through. 
 
 In America, criminals are located by the police especially in 
 the larger cities almost as readily as in Germany, but not per- 
 haps for purposes of apprehension so much as for purposes of 
 graft. The criminal by a substantial payment goes his way 
 and the police and their superiors, the men higher up, profit. It 
 was recently estimated by a noted underworld expert, Jack Rose, 
 in the New York American, that the New York police collect 
 upwards of $16,000,000 a year in graft paid them by gamblers,
 
 PUBLIC WELFARE 373 
 
 women of the street, pickpockets, swindlers, burglars and the 
 like for immunity from arrest. Jack Rose it was who arranged 
 for the murder of the gambler Herman Rosenthal, engaging 
 Lefty Louie, Gyp the Blood, Dago Frank and "WTiitey Lewis for 
 the purpose at the instigation of Police Lieutenant Becker, whose 
 partnership in his gaming house was about to be exposed by 
 Rosenthal. The assassins themselves divided $1,000 for the deed, 
 but had they refused to commit it, they would probably have been 
 ''framed"; that is to say convicted on a trumped up charge. 
 The principal law used by the police in "framing" is that 
 against the carrying of concealed weapons, and the very simple 
 process of a policeman dropping a revolver into the pocket of 
 an arrested person which is thereupon ''found" on his person 
 suffices to convict, often for a long term of imprisonment in the 
 case of a professed criminal. This law is like many others of 
 the stripe ostensibly passed for the protection of the public but 
 in reality for the purpose of tightening the clutches of the grafter 
 on the criminal. 
 
 The partnership of the police and criminals is a sinister mani- 
 festation of disrespect for law which could not exist were the 
 political system such that the public could express its will, in- 
 stead of being helplessly entangled in the hoopskirts of an anti- 
 quated constitution. 
 
 Our system is to blame, and no remedy will be of any perma- 
 nent good except the remedy of a reorganization of the system. 
 
 In Germany, where the governmental system is such that the 
 police must carry out the will of the people, graft is unknown 
 and the criminal cannot count on any immunity of any kind. 
 He draws his issue directly with society, and large and small, 
 has little hope of escape, which is in itself a powerful deterrent. 
 
 Knowing the certainty of the police, the administration of 
 the law becomes much more readily carried out. For example, 
 if an automobilist is guilty of a violation of the speed laws, he 
 is not then and there arrested and confined for the night, but 
 his number is taken and a couple of days later he is informed 
 by postal card when and where to appear in court. The bicy- 
 clist, too, must carry a number on his machine as well as upon 
 his person, and they must agree or else he is summoned too. 
 These numbers on the wheels, through being of different colors 
 and shapes on different backgrounds, and of different types of 
 letters, indicate thereby the city from which the wheelman hails, 
 which further simplifies the police work.
 
 374 THE PRICE OF INEFFICIENCY 
 
 Individuals on being discovered guilty of a minor infraction 
 also simply give their addresses and evidence to establish their 
 identity, being then allowed to go, to be summoned later to 
 court. 
 
 The police officer, too, is expected to take cognizance of vio- 
 ations of the laws, and does so. If he sees a smoking automo- 
 bile, he reports its number of his own accord, not overlooking 
 it as the American policeman does. Similarly, any violation 
 which comes to his attention is marked in his report book in the 
 presence of the violator and no erasures are permitted to be 
 made in the book, which must be turned in every night. For 
 each of such summons or "arrests" the officer in some towns 
 receives as much as eight cents reward. This is not enough to 
 excite his cupidity but in the course of a busy day will buy his 
 cigars and drinks. The violator is duly summoned to the police 
 station where he pays his fine, from twenty-five cents up, unless 
 he objects and demands a court proceeding when the officer must 
 come to appear against him. 
 
 The fines being small, the offender usually settles without 
 further ado. The certainty of the fine and the consequent an- 
 noyance of being summoned, and the certainty that the officer 
 will report the next violation he sees, has a very salutary effect 
 and creates a respect for the law which does not obtain in the 
 United States where fines are so large that a long legal struggle 
 ensues with loss of time to the officer and all concerned if at- 
 tempts are made to enforce minor ordinances. 
 
 The result is that the American is constantly subjected to 
 annoyances and impositions which the European, living under 
 a better system, entirely escapes. The total effect of this is 
 seen in the faces of the men. At sixty, they have an appearance 
 of age which is not seen in the European for ten or more years 
 later. The American works under a nervous strain caused not 
 only by the irritation to which he is subjected, but by his spas- 
 modic and hurried method of work. 
 
 American women are out to spend all the money their hus- 
 bands can get hold of, and the efforts of the husbands to keep 
 them in idleness and to supply them with the luxuries of life, 
 helps to wear out the American long before his time. Abroad, 
 the woman is always seeking to do for the husband and to make 
 life easy for him, just the contrary of the situation in America. 
 The result is that the European husband is relieved of many 
 cares and is able to continue his work vigorously later in life,
 
 PUBLIC WELFARE 375 
 
 and to be able to retire on a competency, whieli would have 
 been spent had he had an extravagant and foolish wife. 
 
 Should a citizen have a complaint to make against a public 
 servant, he finds at the police station a complaint book in which 
 he writes his complaint. The entries in this book duly come to 
 the attention of the higher police officials and suitable action is 
 taken promptly, so that the citizen when he makes such a com- 
 plaint knows that it will receive proper attention. 
 
 The post office stations are similarly provided with complaint 
 books, and any irregularity or negligence suffered by a citizen 
 is promptly looked into and rectified if the complaint appears 
 in the complaint book. These books are often in charge of 
 the officials against whom the complaints are lodged, and they 
 are compelled to perform the unpleasant duty of turning in the 
 complaints against themselves. This in itself acts as a strong 
 incentive to close attention to duty, particularly as the German 
 public is by no means backward in asking for the production of 
 the complaint book. 
 
 In the United States, if a complaint is made, after a long 
 interval, the person making the complaint secures a lengthy and 
 complicated looking document with numerous blanks to be filled 
 out. The amount of work which this involves causes it to be 
 postponed indefinitely, and so the complaint never amounts to 
 much. In police circles the complaining citizen is put to much 
 inconvenience and loss of time by being invited to appear and 
 identify the offending officer, which, if the latter has removed 
 his mustache or otherwise altered his personal appearance, is by 
 no means easy to do. The police stand together in a clannish 
 manner when one of their number is invoved in any difficulty, 
 and if it is of a serious nature, apparently the whole resources 
 of the department are exerted to save the offender. In a recent 
 New York case, eight policemen were accused of perjury in 
 giving evidence to clear a brother officer. This spirit is inimi- 
 cal to public welfare, yet it is a condition which cannot mthout 
 great difficulty be overcome. 
 
 The readiness of the public to make complaints abroad results 
 in a much more efficient administration of the law. The police 
 officer is compelled to attend to his duty and to take cognizance 
 of violations. The public consequently is much less imposed 
 upon and a great many nuisances prevalent in America, espe- 
 cially on the streets, are not in evidence. 
 
 The use of open gratings on the sidewalks for the purpose
 
 376 THE PRICE OF INEFFICIENCY 
 
 of ventilation is not allowed for one thing, abroad. This is a 
 nuisance particularly noticeable in the summer when pedes- 
 trians already partially overcome by the heat, encounter blasts 
 of foul, hot air, full of dust and other foreign matter, blown up 
 out of the gratings. The absence of regulations in this matter 
 shows a curious respect for women. A particularly great im- 
 position is practiced by contractors and constructors for foun- 
 dations and buildings. They occupy half the streets for 
 months, with building materials and supplies. It is customary 
 even to place large steam boilers and hoisting machinery and 
 engines in the street, which cause inconvenience to traffic for long 
 periods, while the sidewalk is removed and platforms erected 
 which are on a higher level, so that the public passing such a 
 building, has the alternative of climbing the steps and taking 
 chances on the platforms over the excavations, or of making a 
 detour in the open street amid vehicles which are dodging 
 around the steam boilers, lime beds, concrete mixers and piles 
 of structural steel and bricks. What right the erector of a pri- 
 vate building has to encumber the street and inconvenience the 
 public is not clear, nevertheless, it is a firmly established cus- 
 tom. It could be ended, however, with very little trouble by 
 proper ordinances. 
 
 Another nuisance of a similar character is the presence of 
 vacuum cleaning engines on the streets with hose running up 
 into the buildings, and a worse form of this nuisance is the 
 engine which pumps blasts of sand used to clean off the surfaces 
 of buildings. These particles of sand fall to the street like 
 snow and do great injury to the eyes of the passers-by, but 
 nevertheless they are constantly in evidence. 
 
 There is much temporizing with nuisances in America, where 
 the law is not regularly enforced with any degree of vigor, be- 
 ing only spasmodically put into effect. This is particularly 
 noticeable with offenders of the streets. The push cart peddler 
 is at times allowed to rest in security, while at other times he 
 is harassed with no end of severity. 
 
 In their treatment of another class of offenders of the street, 
 the police, actuated by a vacillating public sentiment, follow a 
 course of conduct which results in graft, dishonesty and injus- 
 tice. Americans lack the moral courage to deal with this sub- 
 ject in a direct and simple manner, and allow hypocritical 
 moralists to make laws which while they sound well, are utterly 
 impossible of execution. The result is that the offenders, who
 
 PUBLIC WELFARE 377 
 
 are more offended against than offending, are lionnded out of 
 localities where they tend to segregate and are driven into the 
 midst of uncontaminated neighborhoods, and from there back 
 to the streets, where they are exploited by the police until the 
 reformers stir matters up again, when the scattering process 
 begins all over. This social ulcer, instead of being properly 
 treated as abroad, is thus continually being pumped back 
 through the veins of the social organization, until the extent 
 of moral and physical contamination which results from the 
 false, cowardly and hypocritical attitude for which professional 
 reformers are chiefly to blame, reaches an appalling total. One 
 instance of the policy, shown in the abolition of the army canteen 
 with the consequent frequenting by soldiers of the illegal re- 
 sorts near-by, has this result: that the proportion of disease of 
 a certain character among American soldiers is 19.7 cases in 
 100, while in the German army, the similar proportion is only 
 one-tenth as great. 
 
 These figures are taken from a petition of two hundred and 
 seventy-five of the foremost medical men in the country ad- 
 dressed to Congress in the interests of a bill to restore army 
 canteens, since without canteens the soldiers cannot be properly 
 protected from the situation. 
 
 ''The venereal peril," says Surgeon-General Torney, in his 
 latest report, "has come to outweigh in importance any other 
 sanitary- question which now confronts the Army, and neither 
 our national optimism nor the Anglo-Saxon disposition to ignore 
 a subject which is offensive to public prudery can longer refuse 
 a frank and honest confrontation of the problem." 
 
 There has been a steady increase in the class of diseases "so 
 that the admission rate which was 8.46% in 1897, has now 
 reached the enormous figure of 19.7%." A comparison with 
 the figures of some of the European armies will show how grave 
 the ease is. 
 
 Percent. 
 
 American 19.7 
 
 British 7.6 
 
 Austro-Hungarian 5.4 
 
 French 3.5 
 
 Prussian I.9 
 
 Bavarian I.5 
 
 Now as the petitioners observe, it is not the soldier alone who 
 has to suffer. 
 
 "Our army is very largely composed of young, unmarried
 
 378 THE PEICE OF INEFFICIENCY 
 
 men. 'When they marry, they should become the fathers of 
 healthy children, and so add to our population, vitality and suc- 
 cess as a nation. But the fact is that among those who have 
 contracted venereal diseases in the army, a considerable pro- 
 portion will be sterile, others will be characterized by many 
 abortions and their living children will be defective, blind and 
 diseased. What the sorrows of their infected wives may be we 
 know in part, the rest can only be surmised." 
 
 "When conditions such as these exist in the army, where in- 
 dividual cases are promptly treated, it may readily be seen what 
 appalling conditions must exist in private life, where conceal- 
 ment, lack of proper medical attention, quack doctors and other 
 causes produce long continued invalidism and widespread prop- 
 agation of the diseases. 
 
 The American public in its failure to deal directly and 
 honestly with ' ' the most ancient of professions, ' ' commits a crime 
 against itself whose consequences infect the present and will 
 infect the coming generations. The suffering, disease, despair, 
 degeneracy, imbecility, insanity and suicide which compose the 
 failure to deal with the sources of infection, and the hypocriti- 
 cal attitude on the whole question enforced by preachers and 
 false moralists, are a terrible indictment of our civilization. 
 Well may the individual suffer the consequences of his indis- 
 cretion, but the sins of the fathers are visited on the children, 
 and surely the coming generations should not be condemned to 
 the fate in store for so large a proportion of its numbers, to 
 gratify the sanctimoniousness of a handful of professional 
 moralists. This is inefficiency, not of men or machines, but the 
 inefficiency of lack of moral courage, of fair dealing and frank- 
 ness and common honesty.
 
 CHAPTER XXIV 
 DOMESTIC RELATIONS 
 
 The complicated question of divorce— Its great increase — Largely due to 
 economic factors — The home no longer a small factory as in former 
 generations — Present necessity of women leaving the home to do work 
 that was formerly done in the home — Is the increase of divorce bene- 
 ficial? — One marriage in twelve ends in divorce — Ethical effect on 
 children — Lack of control of parents over children — Lack of disci- 
 pline — Failure of school discipline — Unpreparedness of young men 
 and young women for the certain discipline of the world — Wrong ex- 
 amples set bj' parents and school teachers — Superficial education. 
 
 The problem of divorce in America is one of great complexity 
 and of the greatest importance. The stability of the state rests 
 on the family, and tendencies which weaken the family ties 
 undermine the foundations of the state. 
 
 But though divorce has increased greatly in the United 
 States in recent years, there are many important factors enter- 
 ing into the subject, and whether the increased frequency of 
 divorce denotes a weakening of the ties of the family, or is an 
 index of other conditions is a much controverted subject. 
 
 Undoubtedly divorce has lost much if not practically all of 
 the stigma it carried half a century ago, due to the weakening 
 of religious authority. It is therefore a more freely sought 
 remedy and consequently occurs with much greater frequency, 
 which continues the process of diminishing the stigma. 
 
 A second important cause of divorce is the great economic 
 freedom of women, due to the transfer from the home to the 
 factory of much work formerly most economically done in the 
 home. A century ago, every home with its spindle and loom 
 w^as a small factory. Mother and children labored vastly harder 
 and longer than they would now in a factory to accomplish the 
 same result. Thus economic factors accentuated the family 
 bond. To-day, the woman doing the same work outside the 
 home, is much freer than in those days. She may choose a hus- 
 band with greater deliberation and if she is not happy in the 
 union, she may return to her work more readily. 
 
 379
 
 380 THE PRICE OF INEFFICIENCY 
 
 The family, to-day, thus stands on its own feet, so to speak, 
 and the increase of divorce under the circumstances is no cause 
 for alarm to anyone, save the bigot and the ignorant, since it 
 represents only the normal tendency to disunion; the eruption 
 of domestic sores that formerly failed to come to the surface. 
 
 The tendency to continue in the married state is just as great 
 as formerly, but the opportunity of escaping it is more freely 
 presented, so that the increase in divorce does not mean that 
 the family is being undermined, but simply that those who 
 would, under previous conditions, have remained nominally 
 married, now separate. The discontented family is eliminated, 
 so that under present conditions the number of contented fam- 
 ilies is proportionately larger than formerly. 
 
 The Department of Commerce and Labor in its report, "Mar- 
 riage and Divorce, 1887-1906," gives the total number of mar- 
 riages for the twenty years at 12,832,044, an average of 641,- 
 602 marriages per year. In the decade ending 1870, the an- 
 nual average of divorces was 11,207, while in the decade 1890- 
 1900 the average was 55,502. Thus of every twelve marriages, 
 one ends in divorce. 
 
 A curious similarity in proportions may be observed in that 
 one man in twelve in New York City is buried in the potter's 
 field. Thus what may be termed potter's field marriages are, 
 according to the government reports, two and one-half times 
 as great as formerly. The divorce rate annually per 1,000 
 married couples is 4, while in 1870 it was but 1| per 1,000. 
 
 The darker side of divorce is in its influence on the children. 
 Differences between the parents may be settled by divorce and 
 the effects ended, but the effect on the children, the future cit- 
 izens of which the state will be composed, affects the state more 
 than it does the parents. 
 
 On one side the state and the children, on the other, the con- 
 tentions of the parents, and in a larger view the interests of the 
 latter are of less permanent consequence. 
 
 The children of divorced parents can have little respect for 
 the parents they consider in error, and respect for the injured 
 parent is less than would have been the respect felt had no di- 
 vorce occurred. And not only are the children themselves af- 
 fected, but their friends and companions are infected with the 
 spirit, and a lack of respect for parents is created, which ulti- 
 mately shows itself in lack of respect and discipline for all au- 
 thority.
 
 DOMESTIC RELATIONS 381 
 
 Parents in America have less control over their children than 
 in perhaps any civilized country. Parents allow their children 
 to become "smart" which quickly develops into a disrespectful 
 attitude. The theory that the rod hurts self respect of the child, 
 is so widely held that in the schools corporal punishment has 
 been abolished. The results are far from gratifying. Indeed 
 the parents by a too free and too early development of the idea 
 of allowing the child to follow its own sweet will, have lost all 
 discipline, and a condition of disrespect, freshness and disobedi- 
 ence now obtains, both at home and in the school. 
 
 Derelictions, depredations and incivilities are excused by the 
 phrase, "boys will be boys." If this idea is extended, we shall 
 soon be excusing other matters with the phrase, "rowdies will 
 be rowdies." 
 
 From insignificant little beginnings of this kind, the college 
 youth in all his grandeur takes his origin, who later in his enthusi- 
 asm, both in college and military schools, makes gentlemen and 
 officers of his fellow students by standing them on their heads, 
 throwing them in pools of water, tying them to railroad tracks 
 and other direct methods, and who also, as an ardent dramatic 
 critic, frequently wrecks theaters and finds himself incarcerated 
 for a too vigorous style of expression. 
 
 Thus the discipline of the future citizen manifests itself. 
 Under the method followed, the individual comes to have no 
 respect for himself, allowing himself extravagances of all sorts, 
 and being obstinate, self willed and arbitrary, while as a citizen, 
 he does not respect the rights of others and is otherwise lawless 
 if not criminal and in large bodies is of the sort that makes 
 mobs and lynchings. 
 
 A growing tendency on the part of persons of means to have 
 their children privately educated by tutors and governesses, 
 rather than in the public schools, also has the effect of lessening 
 discipline, as there is absent in such training not only the dis- 
 cipline of the teacher whose position is independent of the pupil, 
 but also the discipline which emulation of others enforces. 
 
 The usually inadequate if not insignificant wage paid by 
 those who can well afford to pay a proper wage creates disre- 
 spect and ill feeling between the parent and teacher as well as 
 between teacher and child, making the system one from which 
 good results cannot be expected to flow. It is in reality the duty 
 of the state to supervise such private education, and to see that 
 only competent teachers are employed, teaching suitable courses
 
 382 THE PRICE OF INEFFICIENCY 
 
 and paid suitable salaries. A system of licensing private teach- 
 ers should be instituted and it should be illegal to pay them less 
 than a minimum wage. It is to the interest of the state in the 
 highest degree to see that those who are to be masters of wealth 
 should be properly educated and not be permitted to be held 
 aloof in such a manner that their education, at the hands of 
 governesses earning a few cents an hour shall make them unfit 
 for the responsibilities which they must ultimately assume, if 
 not likely to use their wealth against the interests of the state. 
 
 A long and complicated train of evils flow from divorce. In 
 its proper place it is a useful remedy for worse conditions, but 
 like morphine or cocaine, it is a remedy that for a nation may 
 become a noxious habit. 
 
 As Supreme Court Justice Benedict, of Brooklyn, remarked 
 in denying an application for separation based on slight prov- 
 ocation : 
 
 "AVhen marriage proves a failure to persons who do not look 
 upon it as an obligation and duty, they are prone to hasten to 
 the courts to obtain a dissolution or relaxation of the ties which 
 they voluntarily assumed, but which their own selfishness has 
 rendered irksome. Alimony and counsel fees are but poor sub- 
 stitutes for honor, love and respect, and often serve to still 
 further separate couples who should be reunited." 
 
 The disrespect which children show for parents, springing 
 thus from a laxity in the relations of the family, indicates a 
 growth of so-called individuality, or a form of selfishness in 
 which the sole object of the individual's solicitation is the in- 
 dividual himself. 
 
 This spirit is very noticeable in America, and is the basis of 
 divorce and the disrespect of children for parents; for the 
 parents being selfish do not respect their children, and breed 
 disrespect in them in this manner. Race suicide, or the dis- 
 inclination to make personal sacrifices for the sake of children 
 is the first disrespect for the child. So often being undesired 
 and a burden, the child grows up in an atmosphere of indiffer- 
 ence at least, and the parent further will not exercise his own 
 moral force to properly discipline the child, as the disciplining 
 of children requires a certain exertion and stamina of character 
 which the parent is too selfish or indolent to manifest. 
 
 It is easier to allow the child to exercise its own initiative, 
 and then to get rid of the problem by sending it to school. 
 
 But when an undisciplined child goes to school, in which
 
 DOMESTIC RELATIONS 383 
 
 the teachers are mostly young, underpaid women, whose minds 
 are on any subject except the disciplining of children, its con- 
 dition is not much improved. 
 
 The child sees in the teacher, an example of a Avoman dressed 
 as fashionably as her means will permit, if not much more so, 
 and as the child has seen similar extravagance in the home, it 
 soon falls in the way of the rest of its immediate world, and the 
 final result is a superficial education, acquired under duress and 
 chiefly for the purpose of show, while a thorough digestion of 
 any subject is left to somebody else. 
 
 This lack of thoroughgoing education is largely responsible 
 for the numerous contradictory characteristics developed in our 
 social organization. It makes the greatest difference in the 
 world to the American whose ox is gored, and whenever our 
 personal interests are touched our fine theories curl up like 
 leaves in furnace. 
 
 We are all unanimously in favor of regulating our neigh- 
 bors, but are quick to object to sumptuary legislation when our 
 own spigot is threatened. 
 
 We boast of our patriotism, but we leave the graves of our 
 great men practically neglected. 
 
 We claim that ours is the land of liberty and equality, but 
 there is no land where there is greater inequality between the 
 rich. and the poor, and the just and the unjust. 
 
 We are loud in our praise of the square deal, but it takes a 
 search warrant to find anybody who ever got one. 
 
 We do not permit teachers to use corporal punishment in 
 schools, yet there is no country in which child labor is so greatly 
 exploited. 
 
 We object to vivisection, but we practice sterilization. 
 
 We send invalids abroad for cures, but shut out incoming 
 health seekers. 
 
 We decry charity, yet more money is spent on charity than 
 anywhere else. 
 
 We seek after the truth, but do not recognize it unless it is 
 spoken by those of the great names. 
 
 We proclaim the dignity of the law, but the small culprit 
 has a hundred chances of going behind the bars to the financier 's 
 one. 
 
 We organize cat and dog cruelty prevention societies, yet we 
 murder more human beings in traffic and the industries than 
 any other civilized nation.
 
 THE PRICE OF INEFFICIENCY 
 
 imultiply eugenic clubs, yet nowhere is race suicide so 
 |nt. 
 
 We are quick to criticize, but pray to be delivered frona 
 "knockers" and ''cranks." 
 
 We champion individualism, yet we permit numberless trusts 
 and labor unions whose principal purpose is to stifle individual- 
 ism. 
 
 "We think we are leading the world, but it only appears so 
 because we have almost lost a lap. 
 
 We shout for arbitration of the disputes of Europe, but we 
 are only too anxious to sidestep the Hague when it comes to 
 our own propositions. 
 
 Altogether we have a most admirable comprehension of what 
 others should do to improve our own lot, but very little enthusi- 
 asm for improving the lot of others.
 
 CHAPTER XXV 
 EDUCATIONAL SYSTEMS 
 
 The well springs of education — How nations determine their own destinies 
 — The materials of citizenship — Remarkable educational system of 
 Germany — The salient features of the system — Why it produces good 
 citizens — German discipline — Respect for authority — The well organ- 
 ized army and the Avell organized home — Failure of American educa- 
 tional system to definitely train character — Being taught how to play 
 in Germany — German and American methods of production — The 
 great benefits of the continuation school — Course of study — How 
 adapted to individual trades — Historic aspect of German school sys- 
 tem — The famous classical universities — The modern technical uni- 
 versities — Thorough conuiiercial training — Germany's army of scientists 
 and engineers — Details of the technical educational system — What 
 standing has the American engineer? — The university system which 
 produces original work — Flood of scientific books in Germany — ^Tlie 
 conditions which make them twice as numerous in Germany as in 
 the rest of the world combined — Groat success of Germans in winning 
 Nobel prizes — The plan of exchange professorships. 
 
 The state, being composed of its citizens, is a resultant of 
 what its citizens are. It can rise no higher than its source, and 
 the nation will always be what its citizens make it. 
 
 But the state, as a whole, guided by the wisdom of its wisest 
 citizens, controls its own destiny and progress, in that it can in- 
 fluence and form the character of its future citizens as it will. 
 
 The fate of a nation thus depends on what it makes of the 
 raw material of citizenship which humanity provides, and the 
 great progress which Germany has made in the last half cen- 
 tury is due particularly to the influences which have surrounded 
 the children who have grown to be the citizens of which the 
 nation is now composed; while the failure of other countries to 
 equal her progress, if they have not fallen behind, has been due 
 to failure to utilize to the highest degree the materials of citi- 
 zenship. 
 
 This is most acutely evident in the case of England, which 
 has finally been forced to adopt plans of social improvement, 
 such as pension and insurance systems, after they have been in 
 force in, Germany for a generation. 
 
 385
 
 386 THE PRICE OF INEFFICIENCY 
 
 England having been content merely to build Dreadnaughts 
 and heavy ordnance, now finds that Germany is fortified with 
 an unrivaled educational system, among the fruits of which are 
 the ability to design and construct engines of war of much 
 higher efficiency while her trade mechanisms are such that she 
 readily outdistances other nations. She has built her success 
 upon the impregnable foundations of education and is thus a 
 generation ahead of all her competitors. 
 
 England sees itself now forced to begin a nation-wide cam- 
 paign of education after realizing her disastrous defeat, at a 
 cost of millions of money annually, in competition with other 
 advanced nations, particularly Germany. It would be the part 
 of wisdom for England to model her educational undertakings 
 on the lines which have proven so successful for Germany. 
 
 The statistics of illiteracy of the leading nations of the world 
 show at a glance the unrivaled results of the German system. 
 
 The number of illiterates per 10,000 of population is as follows : 
 
 Russia 6170 in 10,000 or 61% 
 
 Italy 3130 in 10,000 or 31% 
 
 Austria-Hungary .2570 in 10,000 or 25% 
 
 Belgium 1020 in 10,000 or 10% 
 
 United States 770 in 10,000 or 7% 
 
 France 400 in 10,000 or 4% 
 
 Great Britain 100 in 10,000 or 1% 
 
 Denmark 20 in 10,000 or one-fifth of 1% 
 
 Sweden 10 in 10,000 or one-tenth of 1% 
 
 Grermany 5 in 10,000 or one-twentieth of 1% 
 
 Thus it appears that proportionately there are twenty times 
 as many illiterates in Great Britain and one hundred and fifty- 
 four times as many in the United States as in Germany. 
 
 It will be noticed that Austria-Hungary has a very large pro- 
 portion of illiterates. This is due to the Slavonic element of 
 tlie population, mostly found in the southeastern portion, the 
 northern or Germanic part of Austria having a very low per- 
 centage of illiterates. Practically all the Slavonic and allied 
 races show a high degree of illiteracy. Among the smaller 
 countries, the figures are as follows: Bulgaria, 52.7%; Servia, 
 61.6% ; Rumania, 75%, while other Balkan states, Turkey and 
 semi-oriental districts, from which we expect large immigration 
 in the near future, are even more illiterate. Such enormous in- 
 flux will debase still further our national standards which have 
 suffered so much already from the uneducated hordes which
 
 EDUCATIONAL SYSTEMS 387 
 
 have come out of lower Russia. The principle of exclusion 
 which has proven so valuable on our Pacific shores must he ap- 
 plied to the Atlantic seaboard if we are not to be submerged in 
 this flood of undesirables. The danger of the yellow peril, to 
 the gravity of which our brothers in the west had so much diffi- 
 culty in arousing the country, is now duplicated along the Atlan- 
 tic by a peril out of the near-East no less menacing and far more 
 insidious because appealing in a way characteristic of the races, 
 for sympathy and succor from oppression. It is w^ell to care for 
 the lepers of ignorance, to afford them their measure of relief and 
 justice, but it is not well to contaminate ourselves in the process. 
 
 The educational system of Germany is simple, thorough, and 
 of the highest efficiency. It is controlled by the government, 
 through a ministry of education at Berlin, and subordinate 
 boards in the various states, and it is thus a single organization 
 unit. Control of education throughout Germany thus being 
 vested in a single source of authority, there is no conflict of 
 authority and no disproportionate results. 
 
 The salient features which make the German educational sys- 
 tem what it is under this central system of control and super- 
 vision are principally discipline, the interests of the students 
 in their work, ethical instruction, thoroughness and the utili- 
 zation of the knowledge gained. 
 
 The ideal of German education is to make the individual a 
 good citizen, to teach him that his duty is towards the state 
 rather than to himself, German education has thus in view 
 the creation of an efficient state, rather than, as in America, the 
 development of the individual as an individual. This ideal is 
 expressed in the motto, "Alle filr Ein, Bin filr Alle," that is, 
 "All for one and one for all." 
 
 As a matter of fact in making the individual a good citizen 
 it is first necessary to make him a good individual, so that in 
 principle, the German ideal is that of applied individualism. 
 The creation of an efficient state can only follow the creation of 
 efficient citizens. 
 
 German industrial progress is also a matter of education. To 
 support 65,000,000 people on an area less than two-thirds the 
 size of Texas, a population increasing by 900,000 a year requires 
 the utmost economic and social foresight. The exercise of 
 Spartan principles and Prussian drill is necessary, leadership 
 of the highest quality, skill and discipline, all are requisite to 
 cope with the necessity.
 
 388 THE PRICE OF INEFFICIENCY 
 
 With greater natural resources, Germany would probably 
 be less advanced than to-day, as, for nations like individuals, 
 too rich a heritage is likely to prove demoralizing. 
 
 German discipline is a national trait. It is one of the springs 
 of character of the race, and it manifests itself at the outset 
 of the child's career, where in the home, a condition of disci- 
 pline prevails that would seem harsh and unnecessary to an 
 American. But in after years, if not at the time, the child ap- 
 preciates the great value this discipline has been to him, and 
 continues the heritage to the next generation. For Americans 
 to acquire anything like German discipline, is doubtless an im- 
 possibility, even if desirable. Each people has its own traits. 
 Strict discipline is not and is never likely to be an American 
 trait, though all Americans freely admit that more discipline 
 would be a better thing for them. Yet they take no particular 
 steps towards that end. 
 
 Discipline is obedience to orders, and as repetition gams 
 facility, discipline is more or less a matter of drill, of continued 
 practice, and this drill is one of the keynotes of German educa- 
 tional success. 
 
 As pointed out by the late Louis J. Magee, a prominent engi- 
 neer and organizer, familiar with German conditions, in the 
 Engineering Magazirie: 
 
 ''Another element which makes for efficiency in German life 
 and, of course, plays a great role in the school routine, is dis- 
 cipline. The average German is certainly not more mentally 
 alert or convincing than an American in an analogous position. 
 But the national attitude of mind is friendly to order, clearness, 
 organization and precision. Germans are taught respect for 
 existing arrangements; the subordination of the member to the 
 body; regard for duly constituted authority as designated in 
 rank and title. This comes somewhat from military regime; 
 but long before Germany had a well organized army, it had a 
 well organized home. The child's obedience to its father came 
 first of all. The child is not only punished for disobedience, 
 but is trained in a certain code of manners and correctness of 
 formality which, under similar conditions, our children are ex- 
 pected to pick up for themselves. Such training may not pre- 
 vent the subject from becoming a boor, but it will lay the 
 foundation for system; obedience to the orders of the next 
 above, obedience to the laws. This produces a normal type.
 
 EDUCATIONAL SYSTEMS 389 
 
 It may interfere with individuality, but it does not seem to 
 hurt the intellect or weaken the energies. 
 
 After discipline, a feature that is an outgrowth of ancient 
 customs is a powerful factor in German educational success. 
 Not less than two hours a week are devoted to religious instruc- 
 tion in the schools of all classes. 
 
 In older times, the schools were founded for no other pur- 
 pose, and the present allotment of time is a persistence of that 
 
 custom. 
 
 To an American the teaching of religion m the schools would 
 seem an impossible, if not an astonishing condition. ^ It would 
 be utterly repugnant to a large portion of the most intelligent 
 of the community who have no longer any religious beliefs. 
 The separation of church and state is a cardinal principle of 
 American institutions. 
 
 In effect, however, the German system accomplishes the same 
 result, as far as those believing in religion is concerned, and 
 there are great contributory advantages. The school buildings 
 are apportioned according to the religion of the parents into 
 Protestant, Catholic and Hebrew, and each receives its two 
 hours of weekly religious instruction from a minister of its own 
 faith, one competent to give the instruction best suited to the 
 
 conditions. 
 
 These ministers teach religion in the schools, just as the pro- 
 fessors teach mathematics, and the German youth thus acquires 
 a moral training as well as an academic one. In America this 
 is left to the discretion of parents, but as church going is very 
 laxly observed by Americans and as the Sunday schools are 
 not attended by a class of boys most in need of instruction of 
 an ethical nature, the result is that the great majority of Amer- 
 ican citizens have grown to man's estate without any definite 
 training of character. Thus their lines of duty toward the state 
 are unformed, and they raise no protest against graft and in- 
 efficiency in the government. They are citizens made at hap- 
 hazard, and their patriotism begins and ends with applause in 
 theaters when a national air is played or a flag waved by some 
 cheap comedian. 
 
 The results of the German plan prove the great superiority 
 of a system which forms character as well as habits of study. 
 
 A system of religious instruction would be difficult to apply 
 in America owing to the three hundred and odd religions in
 
 390 THE PRICE OF INEFFICIENCY 
 
 vogue, most of them promulgated by hairbrained fanatics for in- 
 terested reasons. The Americans, however, though showing such 
 a diversity in religions are practically united in the worship of 
 a single constitution originated by theorists and never an instru- 
 ment deserving any considerable part of the respect it inspires. 
 The Christian religion, the result of centuries of development at 
 the hands of the cleverest men the world has ever produced, and 
 destined to endure, is by the numbers of its competitors in 
 America seen to receive far less unanimous support than the con- 
 stitution, the work of a few cursory experimenters, which they 
 supposed was constructed to last indefinitely, but which it is 
 now seen must give way to a better system. 
 
 The system of religious instruction, together with the dis- 
 cipline and home training, gives the German child an extremely 
 different point of view in regard to its school work. Greater 
 willingness to study is seen and the lesson is learned from a de- 
 sire to know it rather than merely as a task to be gotten through 
 with as quickly as possible. 
 
 German thoroughness is another foundation of the school 
 system. This is, to a certain extent, a trait of character too,, 
 but it is also a system. The child at play is instructed in the 
 best ways of playing, and this attention to detail permeates the 
 whole system. When he is graduated in any department, the 
 German knows that department thoroughly. 
 
 All this has not been accomplished, however, without develop- 
 ment and reforms, and perfection has by no means been at- 
 tained, but the German system is to-day being copied all over 
 the world, and is the model referred to when any proposed 
 changes are under discussion anywhere. Of a former defect of 
 German education, the limited number of brilliantly educated 
 men, with no intermediately educated class, another quotation 
 may be taken from Mr. Magee's article: 
 
 "It is everyAvhere evident that the Germans are no longer 
 satisfied with a few hundreds of famous scholars, a few thou- 
 sands of professional men — and then a drop almost down to the 
 three Rs. They are wisely grading off their material. They 
 have many different standards as to what constitutes an edu- 
 cated man. Then they try for 99% efficiency under whatever 
 standard the subject may properly belong. Even housemaids, 
 butlers and chimney sweeps may receive in special schools all 
 the correct fundamental preparation for their humble careers." 
 
 A feature of German educational methods, of the greatest
 
 EDUCATIONAL SYSTEMS 391 
 
 importance, is the utilization of the education received and the 
 connection made between school and work. The average Amer- 
 ican boy gets a certain amount of education, and then is turned 
 out to shift for himself, while the principal use he makes of his 
 education is to forget as much of it as possible as soon as he 
 can. 
 
 The German system does not abandon the boy when he leaves 
 school, but keeps in step with him, continuing his education 
 until he has mastered some means of earning a livelihood. 
 
 TV. H. Dooley in "Geraian and American Methods of Pro- 
 duction," in the Atlantic Monthly of May, 1911, describes the 
 sj'stem. 
 
 "The average American thinks that the success of Germany 
 is due to low wages and long hours of work. This is not true, 
 for, if labor is cheaper there, coal is dear, machinery dearer and 
 imported raw material pays a tax. The industrial supremacy 
 of Germany is the effect of definite and deliberate political 
 action. Thirty years ago the German statesmen realized that 
 the nation was inferior to the American and English in natural 
 resources and natural ingenuity; this inferiority forced upon 
 their attention the value of thrift and of education, and thrift 
 was multiplied by capital and education multiplied by industrial 
 efficiency. 
 
 * ' The German government has solved its educational problems 
 in a more satisfactory way than any other country. According 
 to their scheme of education, every worker in a profession, trade 
 or commercial pursuit, must have not only a general education, 
 but technical preparation for the particular work selected by 
 him. In the United States we believe in the same policy, but 
 apply it to those entering the professions only, disregarding the 
 great mass — 95% — that leave school at fourteen. 
 
 "Germany insists that every child be under educational in- 
 fluence till the age of eighteen. The child leaves the common 
 school at fourteen. He may go to work, to a higher school and 
 prepare for college, or to a technical school. In America he 
 may leave school at fourteen and is not obliged to attend any 
 other school. 
 
 "The Germans act on the principle, admitted by everybody 
 who knows or cares anything about education, that the way to 
 secure a good training for the mind is not to end the school 
 life at the most plastic period, fourteen years of age, or in the 
 case of foreigners as soon as they can pass an examination, but
 
 392 THE PRICE OF INEFFICIENCY 
 
 to insist that every boy shall spend a certain number of hours 
 a week under educational training and sound teaching until he 
 reaches manhood. There is less "cramming" and instruction 
 is slower, more thorough, more reasoned, than it can be under 
 our American system of hurrying children through the school. 
 For we must remember that our young men in industrial plants 
 are nothing more than mere machines; they exercise no in- 
 dependent thought any more than the spinning frames or the 
 machine lathes, and the result is that they become deadened. 
 
 "The German government supports continuation schools, 
 called ForUldungs Schule (go on building) for boys above 
 fourteen to continue their instruction after leaving the regular 
 day schools. Attendance upon this school is obligatory in most 
 places for the boy until he is eighteen years of age. The weekly 
 period of instruction is ten hours, of which three hours come on 
 Saturday morning from 9 to 12 o'clock, and three hours each 
 on two work days, from 9 to 12 in the morning, or from 4 to 
 7 in the afternoon. This arrangement of hours can be changed 
 to suit the needs of the employer. No instruction is given after 
 
 7 P.M. 
 
 ' ' The instruction is adapted to the needs of the various trades. 
 There are classes in arithmetic for machinists, loom fixers, etc. 
 The terms used in the class room savor of the shop and the mill. 
 What is three-fourths of 25^ does not mean so much to the 
 foundry man as a problem like this : If a copper casting weighs 
 25| pounds and the specific gravity of iron is three-fourths that 
 of copper, what will the casting weigh if made of iron? Then 
 again, the same problem would not interest the textile worker, 
 unless it involved mill calculations. Working people have 
 minds of a distinctly concrete order. They have intensely prac- 
 tical aims wlien they come to school, and are unwilling to study 
 systematically an entire subject as they did in the common 
 schools. They demand that the instruction shall lead directly 
 to the specific things tliey are dealing with in their work. The 
 German continuation school adapts its methods of instruction 
 to meet the needs of the working people. 
 
 "To give an illustration — the Munich Continuation School 
 for Machinists' Apprentices offers the following subjects: Re- 
 ligion, maoliine shop calculations and bookkeeping, business 
 correspondence and reading, the study of life and citizenship, 
 mechanical drawing, physics and machinery, materials and 
 shop work. The subjects of instruction are in the closest possi-
 
 EDUCATIONAL SYSTEMS 393 
 
 ble connection with the requirements of the machinists' trade." 
 
 The distinguishing characteristics of the German educational 
 system may be summed up in the word efficiency. To obtain 
 the greatest amount of benefit possible to be obtained in 
 the objective and central control, discipline, willingness of the 
 pupil, ethical instruction, thoroughness and continuity are the 
 features most in contrast as compared with the American sys- 
 tem. 
 
 The German system to be thoroughly understood and appre- 
 ciated, needs to be described in some detail, but particular com- 
 parisons with the American system need not be carried out as 
 the latter is well understood. In order to understand the pres- 
 ent status of the highly developed German system, a short his- 
 torical review of its origin and gradual growth is necessary, 
 and the following matter from the author's article, "The 
 Educational System of Germany," which appeared in Amey-i- 
 can Education, May, 1911, covers the ground in a condensed 
 form. 
 
 ' ' The Christian religion preserved the ancient culture through 
 the dark ages, during which the church w^as the only provider 
 of education. It was but natural that great weight should be 
 laid upon the teaching of religion, and in fact at the very be- 
 ginning the object of teaching was to spread religion. The lan- 
 guage of the monks was Latin and consequently Latin w^as the 
 medium through which all education was to be obtained. 
 
 "The 13th and 14th centuries brought about a change from 
 clerical to worldly methods due to the development of cities, the 
 prosperity following in the wake of commerce and trade, and 
 the power and influence of the citizens. "With this increase in 
 importance of citizenship and the growi;h of these communities, 
 the necessity of town schools was felt, and these were established 
 on the lines of the cloister schools for preliminary education 
 only, but in the long run did not satisfy the demand for educa- 
 tion, so that Latin was altogether abolished and the German 
 language and alphabet took its place for public and business 
 education. 
 
 "This may be considered as the foundation of the common 
 schools of Germany, Naturally, after the establishment of this 
 educational system, the demand for higher education was bound 
 to come. This desire was largely influenced by Luther's trans- 
 lation of the Bible into German, Guttenberg's invention of the 
 printing press and the general advancement of science. The
 
 394 THE PRICE OF INEFFICIENCY 
 
 realization of higher education was marked by the founding of 
 the University of Leipzig in 1409. As the preliminary educa- 
 tional system resulted in the foundation of universities, so the 
 universities on the other hand, influenced betterments in the pre- 
 paratory methods. 
 
 "Compulsory education was now suggested and finally the 
 state took in hand all matters of education and this was the be- 
 ginning of the system of general higher education which led to 
 the establishment of the present Gymnasium, which long held 
 sway as a preparatory school for the university. 
 
 "It is endeavored herein to outline the courses of study as 
 provided by law as a standard. It would, however, not be within 
 the scope of this article to discuss the educational system as a 
 whole with all its additions such as excursions to the woods, to 
 the country, to museums, etc., in the lower schools; special 
 classic performances in leading theaters for the middle schools; 
 or, for instance, educational tours of a duration of ten or more 
 days for the university. Neither shall much be said of the sys- 
 tem prevailing at the universities, which allows the student to 
 attain his education at as many universities as he wants to, thus 
 giving him the advantage of hearing lectures by the different 
 prominent professors on the different subjects. 
 
 "In consequence of the rapid advancement of science and the 
 desire for further research, the theories of the ancients were 
 not so strictly accepted, and recourse was had to the universities, 
 to independent thought, and to the investigation of natural phe- 
 nomena. Copernicus, Galileo, Kepler and Newton had already 
 advanced their new theories; Columbus, Vasco de Gama, and 
 jMagellan through their discovery of new worlds, had widened 
 the scope of vision and Ratke and Comenius worked out theories 
 for teaching from a new point of view, which, however, coald 
 not immediately be put into effect because of the unrest conse- 
 quent upon the 30 years war. 
 
 ' ' Frederick Wilhelm I of Prussia, in 1717, finally inaugurated 
 the system of compulsory education, and founded 2,000 new 
 schools. In 1794, the general law of the state laid down fixed 
 rules for the entire system of Prussian schools. The following 
 are a few paragraphs which may illustrate its nature: 
 
 ''Paragraph 1. Schools and universities are state institutions 
 which have in view the teaching of young people in useful 
 knowledge and science. 
 
 "Paragraph 9. All public schools and educational institu-
 
 EDUCATIONAL SYSTEMS 395 
 
 tions shall be under the direct supervision of the state, and are 
 subject to visitations and inspections at all times. 
 
 "Paragraph 29. Where no endowTnents exist for a public 
 school, the expense of the institution must be borne by all the 
 male heads of households regardless of the number of children 
 which each family may have. 
 
 "Paragraph 34. The cost of maintenance of school buildings 
 and dwellings for teachers must be borne by the inhabitants of 
 the district as a common burden. 
 
 "Paragraph 43. Every inhabitant who is not able or does 
 not care to employ private tutors for his children, must send 
 them to the public schools when they have attained the age of 
 5 years. 
 
 "Paragraph 46. Instruction must be continued until the 
 child, in the opinion of the school authorities, has acquired that 
 knowledge which the average sound minded individual, accord- 
 ing to his or her standing, is supposed to have. 
 
 "Paragraph 50. The exactions of compulsory education 
 must not interfere with the health of the pupil so that it might 
 in any sense become dangerous to his well being. 
 
 "The business and professional men, the artists and the arti- 
 sans in the early part of the 19th century already felt the need 
 of a higher public education due to the rapid development of 
 industry and technique, and a school was established called the 
 Real Gymnasium which ranks with the gymnasium as a scien- 
 tific school and which lays special stress on modern languages, 
 mathematics and natural science, 
 
 "Through the efforts of the great pedagogue, Johann Hein- 
 rich Pestalozzi, in the first half of the 19th century, the public 
 school took its proper position, inasmuch as it became its prov- 
 ince not only to teach the necessary elementary branches but 
 also to awaken the spiritual forces of the pupil so that indepen- 
 dent, confident and logical action might result. To relieve the 
 strain which was put on the pupil by his spiritual education, he 
 introduced the now highly developed system of gymnastic exer- 
 cises. The pupil of Pestalozzi, Frederich Froebel, founded 
 the "Kindergarten" system which now is known the world 
 over. 
 
 "Upon the establishment of the present German Empire in 
 1871, the entire school system, and particularly as applied 
 to the common school (Volks Schule and Buerger Schule) was 
 again improved and in 1872 Prussia regulated the educational
 
 396 THE PRICE OF INEFFICIENCY 
 
 system, and among other things introduced an intermediate 
 school, which is an extension of the Volks Schule. In this inter- 
 mediate school, or Mittel Schule, one foreign language, additional 
 mathematics, and some of the Real Gymnasium branches are 
 taught. Consequently Germany now possesses the following 
 educational institutions : 
 
 ''Volks Schule (no tuition) or Buerger Schule (with tuition 
 fees), Mittel Schule, Real Schule, Ober Real Schule, Real Gym- 
 nasium, Gymnasium and Universitat. 
 
 These schools may be divided into three categories: The 
 lower school system, the upper school system and the univer- 
 sities. 
 
 ''The system of lower education comprises the Volks Schule, 
 Fortbildung Schule and the Mittel Schule. 
 
 "The compulsory education law requires that the child enter 
 the school in the calendar year in which it reaches the age of 
 six years and continues through a training of at least eight 
 years of schooling. 
 
 "The Volks Schule and Buerger Schule comprise eight terms 
 of one year each, aggregating from 22 to 32 hours of study per 
 week. During the first period, religion, German, arithmetic, 
 singing and gymnastics are taught, in the second period, draw- 
 ing and object lessons are added, and in the third period geom- 
 etry', history and physics. 
 
 "The Mittel Schulen or intermediate schools are intended for 
 such pupils who desire a somewhat higher education than can 
 be had in the Volks Schulen and who expect to better fit them- 
 selves for industrial and commercial life. Such schools continue 
 six terms of one year each, subsequent to the first three years 
 of the Volks Schule. The course of study during the first 
 year, to which 24 hours per week are devoted, covers religion, 
 German, arithmetic, singing and gymnastics. To these are 
 progressively added geometry, botany, physics, geography, his- 
 tory, French or English and drawing, so that finally during the 
 last term, 32 hours per week are devoted to this list. 
 
 "It must further be noted that there are a number of city 
 schools, particularly in the industrial districts, in which the 
 courses of the studies embrace a combination of those of the 
 Volks Schule and Mittel Schule. In order to equalize the edu- 
 cational advantages as between the pupils of the upper and 
 lower classes, all cities and many large towns are provided by 
 the communities with so-called Fortbildungs Schulen, which
 
 EDUCATIONAL SYSTEMS 397 
 
 constitute an extension of the Mittel Sehulen and in which Ger- 
 man composition, arithmetic, mathematics, physics and draw- 
 ing are taken up, and also such branches as enable the pupil 
 to better follow commercial and industrial pursuits. Two to 
 four hours per day and two or three days per week are devoted 
 thereto, and the course extends over a period of three to four 
 years. 
 
 "In order that graduates from the last named schools may 
 later in life be enabled to acquire additional instruction of a 
 higher order, the so-called Volks Hoch Sehulen were established 
 in 1898, in which lectures were given during several months 
 of the 3^ear, principally in the larger cities. The course of study 
 at the Berlin Hoch Schule for instance comprised the following 
 lectures for the year 1900, viz: 
 
 ' ' On the effects of the newer remedies and drugs ; on the con- 
 stitution of the universe; the prevention of sickness in daily 
 life; Greek sculpture; on germs, causes of disease and its pre- 
 vention; our atmosphere and its compositions; the origin and 
 prevention of nervous diseases; the earth and its history; the 
 life and works of Goethe. 
 
 ''This is a six weeks' course for which a nominal fee of one 
 mark (25 cents) per evening is charged. Two thousand at- 
 tended this" course. At another course in Leipsig, the attend- 
 ance was 10,000. 
 
 "Similar courses of study are provided for in country dis- 
 tricts and which usually extend through a period of five months 
 for men and three months for women. In these schools, the 
 subjects taken up vary from year to year. 
 
 "The system of higher education comprises the Gymnasium, 
 the Real Gymnasium, the Ober Real Gymnasium, Reform 
 Schule, Real and Hoehere Buerger Schule. These constitute 
 two groups, the Gymnasiums and the Real Sehulen. The dis- 
 tinction between the two groups is as follows: 
 
 "The Gymnasium group comprises the Gymnasium and the 
 Ober Real Sehulen, in all of which the courses extend over a 
 term of nine years and differ only in that in the Gymnasium, 
 Greek and Latin is taught, in the Real Gymnasium Greek and 
 Latin are omitted and French and English substituted and in 
 the Ober Real Schule these modern languages, additional mathe- 
 matics and natural science are substituted for Greek and 
 Latin. 
 
 "The Real Sehulen group comprises the Real Schule, the Re-
 
 398 THE PRICE OF INEFFICIENCY 
 
 form Schule, and the Hoehere Buerger Schule, which all cover 
 a six years' course. 
 
 ' ' The courses of study in the Gymnasium group, and to which 
 25 to 31 hours are devoted per week, are with the exceptions 
 and substitutions noted above, religion, German, Latin, Greek, 
 French or English, history, geography, mathematics, natural 
 science, penmanship and drawing. 
 
 ''The Ober Real Schulen, in which the ancient languages are 
 entirely eliminated, are intended to prepare the student for the 
 technical and commercial professions. 
 
 "The greater number of these schools are located in the 
 Rhineland province, the great industrial district. 
 
 "The Real Schulen group have a six years' course only, but 
 the course may be continued in the Ober Real Schulen by com- 
 pleting the three upper grades of the latter. The student who 
 has completed a nine years' course in any of these schools, is 
 entitled to admission to the universities. 
 
 "Much stress is laid upon gj'mnastics throughout the entire 
 course in these upper schools. Two afternoons in the week, 
 not devoted to studies, are reserved for this purpose. 
 
 "The courses for the higher education of German women 
 cover a term of nine or ten years, which compares with our high 
 schools and colleges in purpose, and in the kind of education 
 attained in them. 
 
 ' ' Some of the higher schools for females are private and others 
 are state schools, but all are under state supervision. To these 
 courses may be added, in order to fit the German women for 
 academical study, a four years' course patterned or selected 
 from the course of the Ober Real Schule. 
 
 "The German universities, in consequence of their historical 
 development, occupy a conspicuous position among the univer- 
 sities of the world. This also holds good for the technical uni- 
 versities and the other scientific institutions of Germany. The 
 universities do not merely serve for acquiring the highest edu- 
 cation in scientific matters, but are at the same time centers for 
 independent research; their libraries, laboratories, collections, 
 observatories, etc., are consequently fitted up not only to meet 
 the requirements of students, but are intended to give instruc- 
 tors and young experimenters the means and assistance for fur- 
 thering the development of science in all its branches. 
 
 "This sphere of university activity finds important exten- 
 sion in the work of the academies and learned societies which
 
 EDUCATIONAL SYSTEMS 399 
 
 are organized and supported by the state. The state academies 
 are all situated in university towns and members thereof are 
 qualified to deliver lectures in the universities. 
 
 "The immediate purpose of the universities is to give instruc- 
 tion in science, theology, law, medicine and philosophy. The 
 philosophical faculty, which originally had the task of prepar- 
 ing students for entry in the upper courses, now covers a very 
 large field. Languages, natural science, chemistry, mathemat- 
 ics, pedagogy, political economy are some of the principal 
 branches taught. 
 
 "The principal representative of the university is the rector, 
 who holds the office for one year and is elected by the professors 
 among their number. The business of the various faculties is 
 transacted by the deans who are similarly elected by the regular 
 professors of each faculty. The body of instructors for science 
 consists of regiilar professors and private tutors in addition to 
 which are lecturers and assistants. The students matriculate at 
 the university and are enrolled in one of the faculties. Only 
 those are fully qualified to matriculate who have the certificate 
 from one of the nine years' course upper schools (Gymnasium, 
 Real Gymnasium, Ober Real Schule). Foreigners must pro- 
 duce a certificate of a corresponding standard. Students may 
 also be enrolled in the philosophical faculty under less exact- 
 ing conditions. Besides this, certain branches admit Hoerer 
 (listeners) to the lectures. 
 
 "That there are a great number of women in Germany in 
 higher education is not understood in this country, probably 
 for the reason that the greater application of the male students 
 takes away attention from them. Women are not satisfied merely 
 to complete the academic courses, but take the university courses 
 of four years or more leading to degrees. In the winter semes- 
 ter of 1911, the women students were 4.8% of the w^hole num- 
 ber of matriculated students, some 4,532 attending the univer- 
 sities, of which 2,795 were full fledged students and the balance 
 listeners. The former had been through the regular prepara- 
 tory courses required of the male students while the listeners 
 were subject to the same requirements as the men listeners. 
 
 The subjects pursued by women students during the semester 
 mentioned above were philosophy, philology, and history, 1,563 
 students; mathematics and natural history, 504; medicine, 582; 
 political economy, 67 ; law, 39 ; dentistry, 27 ; pharmacy, 8 ; Prot- 
 estant theologj', 5.
 
 400 THE PRICE OF INEFFICIENCY 
 
 "All faculties confer the degree of doctor and the theological 
 faculty also covers the lower degree of licentiate. The secur- 
 ing of such a title is not, as a rule, the aim of the students, as 
 alone it does not qualify him for the state service. Besides the 
 purely academic examination for the degree of doctor, state ex- 
 aminations are held for the principal professional callings and 
 ecclesiastical examinations for the theological. To be admitted 
 to a theological, legal or higher grade of teachers' examination, 
 it is necessary to take a course of study of three years at the 
 university as a fully matriculated student. For the medical 
 profession, the period of study has been lengthened to five years. 
 
 "Following is a list of the German academies and universi- 
 ties: 
 
 "Academies: 
 
 "Berlin, established, 1700; Goettingen, 1751 ; Muenchen, 1759; 
 and Leipzig, 1846. 
 
 ' ' Universities : 
 
 "Heidelberg, established 1386; Leipzig, 1409; Rostock, 1419; 
 Greifwald, 1456; Freiburg, 1457; Tuebingen, 1477; Marburg, 
 1527 ; Koenigsberg, 1544 ; Jena, 1558 ; Wuerzburg, 1582 ; Giesen, 
 1607; Kiel, 1665; Halle, 1694; Breslau, 1702; Goettingen, 
 1737; Erlangen, 1743; Berlin, 1809; Muenchen, 1829; Strass- 
 burg, 1872; Bonn, 1880 and Muenster, 1902 (founded as an 
 academy 1771)." 
 
 The German educational system overlooks no department in 
 which activity in later life must be exercised. Training is 
 divided into three principal branches; industrial, commercial 
 and technical; industrial for the worker, commercial for the 
 business man and his assistants, and technical, for the engineer- 
 ing, chemical and similar branches. 
 
 The Journal of Commere,. Oct. 25, 1911, reports an address 
 by Herr Dr. Knorck, of the Commercial Schools of the Berlin 
 Board of Trade, describing the progressive and thorough 
 methods of the German Commercial educational movement. 
 
 "The practical German teaching which has been handed down 
 from the guilds and corporations of the Middle Ages, according 
 to which the apprentice came into the closest social and business 
 connection with his master and teacher, has had a part in its 
 modernized form in the successes which the German merchant 
 has won in the world's markets. His present occupation was 
 backed by the thoroughness of German scientific education, 
 which, since the middle of the last century, has clearly recog-
 
 EDUCATIONAL SYSTEMS 401 
 
 nized the social problems of to-day, by the establishment of com- 
 mercial and economical schools, and has developed them system- 
 atically. Professional education and commercial teaching, 
 practice and theory worked together in Germany to create a 
 mighty army of clever mercantile employees, and a chosen host 
 of far-seeing merchant masters, who are not afraid of the 
 greatest enterprises in the trading world at home or abroad. 
 The state municipalities and the commercial unions supported 
 this far-reaching economical culture to their utmost ability. 
 
 "Practical experience is as always, regarded in Germany, 
 as the most important foundation of professional training. 
 After a certain all-around education has been attained at the 
 elementary or intermediate school, the future merchant usually 
 begins the practical training at once, which, in keeping with 
 ancient custom, lasts three years. For those who have passed 
 through the intermediate schools with their six classes, who 
 have, that is, received a certificate of one year military service, 
 sometimes two to two and a half years are regarded as suffi- 
 cient; even those who have the graduating certificate of the 
 higher, nine-class school, and therefore have the right to go to 
 the university or technical university, must submit to this long 
 practical training. A long practical course extended over 
 several years is even required, quite apart from the general 
 education, before one can attend the German commercial col- 
 leges. 
 
 "As to the practical training, the German commercial code 
 imposes certain definite duties upon the employer in his re- 
 lation to the apprentice. He is obliged to see that the appren- 
 tice is (1) initiated into all the commercial business of the firm. 
 Hie is to (2) conduct the education of the apprentice, either per- 
 sonally or by means of a capable representative. (3) Thorough- 
 ness and method should prevail throughout this training, which 
 ought not to be encroached upon by services of a secondary na- 
 ture. The principal is expected to watch over the moral con- 
 duct of his apprentice and encourage him to attend the con- 
 tinuation school. He has likewise to look after his physical 
 welfare. Those who have forfeited the rights of citizenship 
 are not retained as apprentices. 
 
 "No intelligent and successful merchant in any land to-day, 
 will be found to deny for the coming generation of merchants, 
 the necessity of theoretical and scientific education along with 
 practical training. The apprentice ought thus to be trained
 
 402 THE PRICE OF INEFFICIENCY 
 
 to clear reasoning, and the knowledge and skill gained by him 
 in business will be widened, organized and deepened. 
 
 "What means are tried in Germany for this purpose and 
 what are the results? All masters are obliged to allow all ap- 
 prentices sufficient free time to attend a publicly recognized 
 professional or continuation school. At the same time, the in- 
 dustrial code gives the town authorities the right of compelling 
 all male and female commercial apprentices up to the age of 18 
 years to attend school. These authorities are thus allowed, 
 though not compelled, by the imperial law to maintain compul- 
 sory professional and continuation schools. 
 
 "The courses in these professional schools, to which those of 
 the Berlin Merchants' Corporation also belongs, corresponds 
 generally to the practical apprenticeship, namely, three years 
 with six hours a week. Very few courses exceed this number 
 of hours, those of the Berlin corporation with eight hours and 
 those in Saxony with twelve being exceptions. 
 
 "The curriculum contains the following subjects: Shorthand, 
 which has been almost universally adopted ; general commercial 
 instruction as the basis and introduction for the entire sphere 
 of commercial knowledge, which is contained in practically 
 every course; office and correspondent work are usually con- 
 nected with this; and the all important commercial arithmetic 
 is included in each year's curriculum. Commercial and eco- 
 nomical geography has been almost everywhere introduced as an 
 obligatory subject, while everybody is in agreement as to the 
 fundamental significance of bookkeeping and civics. 
 
 "The question over which there is most dispute is whether a 
 foreign language should be introduced into the course. This 
 is naturally as good as impossible in a six hour course. In Ber- 
 lin, with our eight hours, we have made one foreign language 
 (English or French) compulsory; three hours being allotted to 
 it." 
 
 The former idea of Germany as a country of soldiers, black 
 forests, violins, castles, professors, beer and dreamers is now 
 being sharply revised. It is seen that the rest of the world 
 has less to fear from German military ambitions than from its 
 army of scientists, engineers, scientifically trained directors of 
 industrial enterprises and highly educated commercial agents. 
 That she possesses such an army as the latter is due to her edu- 
 cational system, particularly the technical schools and univer- 
 sities. The great value of these is described by President Had-
 
 EDUCATIONAL SYSTEMS 403 
 
 ley of Yale University, who in his address, "What the United 
 States has to Learn from the Technical Training of Germany," 
 delivered before the Brooklyn Institute of Arts and Sciences, 
 and based on personal study and observations while he was 
 lecturing before the universities in Germany, said: 
 
 "There are two great points in the German educational sys- 
 tem which must impress every one — the use of the technical 
 training and that of the military training of the people. The 
 children are forced to go to the elementary schools for a time, 
 and during that part of their education, they are kept out of the 
 shops and factories. They, however, receive instruction in the 
 rudiments of shop and factory work." 
 
 Dr. Hadley laid particular stress upon the growth and useful- 
 ness of the technical schools in Germany during the last half 
 century. Before the spread of these schools in Gemiany, he 
 said, the Germans were considered an idealistic and sentimental 
 people. 
 
 "To-day they are intensely practical," he said. "They are, 
 indeed, more practical than the Americans. They have become 
 a military race. Their ideals are technical. They value things 
 for their value in dollars and cents or for the social position 
 w^hich these things give their possessors. The Kaiser has been 
 a ringleader in bringing about these changes in the views of life 
 entertained by his subjects. 
 
 "Our good technical schools are rare. The graduates of our 
 technical schools get most of their training in the shop, on the 
 farm, or in the mine. In Germany, the best part of the stu- 
 dent's training is received in the schools. The objects of the 
 system in the German schools are two — to develop the individual 
 and advance the welfare of the country by teaching the students 
 what will best advance the interests of the country. 
 
 "The attitude of public mind in Germany and America to 
 the respective educational systems is significant. In this coun- 
 try it is regarded as an accident if a man who has been taught 
 the theories of commercial life in the schools succeeds when he 
 begins his active career. In Germany it is considered an acci- 
 dent, if success comes to those men who have not been trained 
 in the schools, and an accident that should not be repeated. 
 
 "Is it any wonder that England is complaining that the Ger- 
 man business men, who are trained in the technical schools and 
 are thorough students of the conditions they confront, are driv- 
 ing the English traders out of the neutral ports? If such
 
 404 THE PRICE OF INEFFICIENCY 
 
 methods succeed in commerce tliey will succeed in all things. 
 Individual action cannot contend successfully with the united 
 front of the Germans in the long run. _ _ 
 
 "I believe there is developing in this country, the spirit of 
 organization. There has been a tendency to crowd the techni- 
 cal men out. We are beginning to profit from the lessons of 
 Germany and her education system, giving our men good train- 
 ing in all lines adapted to practical life." 
 
 An account of the technical educational system of Germany, 
 briefly describing its principal feature is as follows, taken from 
 the author's lecture, "Engineering Education in Germany," as 
 given at the eighteenth annual meeting of the Society for the 
 Promotion of Engineering Education, at the University of Wis- 
 consin, June, 1910: 
 
 "After the great struggle from which the German states 
 gained their independence, at the termination of the Napoleonic 
 War in 1815, the economic conditions of Germany had reached 
 the lowest ebb. At that time the German states had but a 
 small population left, owing to the undeveloped state of com- 
 mercial industries and the devastation due to this long struggle. 
 In England, at that time, the steam engine had begun its tri- 
 umphal progress and opened up the country's richness in iron 
 
 and coal. 
 
 "It was recognized in Germany that the country could only 
 be lifted economically through the expansion of industrial activ- 
 ity. Two ways led to this end; the practical way, taken by 
 pioneers like Krupp, Borsig and Siemens, working quietly and 
 uninterruptedly to replace the former state of handicraft by 
 organized industry; and the theoretical way, adopted by the 
 government, of placing industry on a scientific basis by the es- 
 tablishment of technical schools. That permanent progress in 
 competition with other countries could only be built up satis- 
 factorily on such a foundation is proven by the recent develop- 
 ments in chemistry and electricity, as well as in heat-engines 
 and in engineering in general. 
 
 "The beginning of the German technical schools dates back 
 to the middle of the nineteenth century. Nearly all of the 
 technical colleges originated, however, from the so-called Mittel 
 Schulen (intermediate schools), and only after they had, by 
 continuous effort, obtained a high standing, did they obtain 
 charters as Technische Hoch Schulen (technical universities). 
 As an example, the Berlin Technical University was formed
 
 EDUCATIONAL SYSTEMS 405 
 
 by the union of the Architectural School founded in 1779 and 
 the Commercial Acadaray or Trade School, founded 1821. 
 
 "The aim of the technical university is expressed in the first 
 paragraph of the constitution of the Berlin Technical Univer- 
 sity, which reads as follows : ' The aim of the technical university 
 is to furnish a means for higher education for the technical 
 professions, in civil and industrial service and in commercial 
 undertakings, as well as to cultivate the arts and sciences so 
 far as they come under the head of technical instruction.* 
 Every technical university has departments for separate studies, 
 and in each are divisions for architecture, civil, mechanical and 
 electrical engineering, chemistry, metallurgy' and mining; 
 natural sciences and mathematics. There are some of these uni- 
 versities which have special departments, as electro-chemistry, 
 marine engineering and aerial navigation, forestry, agriculture, 
 etc. 
 
 "The great development of technology made necessary the 
 opening of a great number of new courses in all the technical 
 schools. The most recent new course is that in aerial naviga- 
 tion, thus helping to make a positive science of this means of 
 transportation. 
 
 "Germany at present has eleven universities, established and 
 chartered as technical universities as given below: 
 
 "Berlin, established 1799, chartered 1799; Stuttgart, 1829, 
 1862; Dresden, 1828, 1851; Carlsruhe, 1825, 1865; Darmstadt, 
 1836, 1868 ; Aix la Chapelle, 1870, 1870 ; Brunswick, 1745, 1877 ; 
 Munich, 1827, 1877; Hanover, 1831, 1879; Danzig, 1904, 1904; 
 and Breslau, 1905, 1905. 
 
 "A certain prescribed preliminary education is necessary to 
 qualify the student for admission to the technical universities. 
 There are three classes of attendants : the regular student, the 
 so-called 'listener' and the guest. Those who wish to enter as 
 regular students must have had a nine-year course of instruc- 
 tion at one of the G^Tunasiums, Real-Gymnasiums or Ober-Real- 
 Schulen, and must have graduated therefrom by taking the so- 
 called 'Abiturienten' examination. This nine-year course can- 
 not be entered upon until after the student has passed through 
 a three or four year course in the lower schools, so that if he 
 enters the latter at the age of six, he will be at least nineteen 
 years of age before he enters the technical college, since he must 
 also put in one year at practical training in regular manufac- 
 turing plants.
 
 406 THE PRICE OF INEFFICIENCY 
 
 "In the Ober-Real-Schulen ancient languages have been en- 
 tirely eliminated from the course of study and more time is 
 devoted to modern languages, natural sciences and mathematics, 
 the whole course being especially arranged for preparing the 
 student for the technical professions. The majority of these 
 Ober-Real-Schulen are found in Prussia, there being 42 as 
 against 69 in Germany, and as stated, the greater number of 
 these schools are located in the province of Rhineland, the great 
 industrial district. 
 
 "The practical experience prescribed for these students 
 covers at least one year, for mechanical and electrical engineer- 
 ing, in pattern shops, foundry and machine shops. Two years 
 are frequently voluntarily devoted, part of which is spent in 
 construction in the field. 
 
 "As military service in Germany is compulsory, being gener- 
 ally a two or three year service, it might be stated here that 
 those who have graduated from any of the three schools refer- 
 red to are required to serve only one year in the army. Many 
 students first absolve this military service before entering the 
 technical university. As the regular course in these univer- 
 sities consists of eight semesters (four years) it will be observed 
 that the graduate from the university will have reached the 
 age of at least twenty-four years. 
 
 "Technical universities confer first the degree 'Diplom In- 
 genieur' (always abbreviated as 'Dipl. Ing.'). The certificate 
 of graduation always qualifies the graduate to enter upon a fur- 
 ther examination for the degree of 'Doctor Ingenieur' (abbre- 
 viated as 'Dr. Ing.')- This degree may also be conferred as an 
 honorary title in recognition of work done in a technical line. 
 
 "A graduate having the degree 'Dipl. Ing.,' must, if he 
 desires to enter the federal service, give notice thereof to the 
 state within six months after graduation, and, if engaged, after 
 state examination, he is made 'Regierungs Baufiihrer.' After 
 being in service for four years, he may take a promotion ex- 
 amination for 'Regierungs Baumeister,' and eventually may 
 reach the top of the service. 
 
 "The 'listener' can only be qualified to enter^ the German 
 Technical University after graduating from one of the six-year 
 courses in the Pro-Gymnasiums or Real-Schulen. The distinc- 
 tion between Gymnasium and Real-Schule is as follows: To the 
 former belong the Gymnasium, with a nine-year course, and the 
 Pro-Gymnasium with a six-year course. To the second class,
 
 EDUCATIONAL SYSTEMS 407 
 
 or Real-Sclmlen, belong those in which Latin is included, namely 
 the Real-G\annasium and the Real-Pro-Gyranasium. The term 
 in the former is nine years and in the latter six years. To this 
 group belong also such as include no Latin course, namely, the 
 above named Real-Schule with a nine-year course, and the Real- 
 Sehule with a six-year course. The graduate from such schools 
 with a six year course, need also serve but one year in the army. 
 A preliminary course of from three to four years in the lower 
 school precedes the courses in these six-year or upper schools. 
 This graduate is termed 'Einjahriger,' with reference to the 
 military service, and the graduate from the nine-year course 
 alone is referred to as the ' Abiturient, ' (one who has made the 
 Abiturienten examinations) . 
 
 " 'Listeners' may also be those who have graduated from a 
 Technische Mittel-Schule or College, such as the Technicum, 
 Maschinenbau-Schule, Baugewerk-Schule, Kunstgewerbe-Schule, 
 etc. These listeners are usually men of riper age, who have 
 already been engaged in practical work and who wish to acquire 
 additional knowledge in their special branches of work. They 
 therefore choose but certain lectures, usually extending over 
 from two to three years. 
 
 " 'Guests' are those who have had an academic training or 
 such other persons who would not be regularly entitled to enter 
 as listeners; they can attend only a limited number of lectures. 
 "Instruction in these technical universities is in the form of 
 lectures, exercises, shop and laboratory work (upon which much 
 stress is laid), and visitation of manufacturing plants. Large 
 experimental shops and libraries serve as auxiliaries for instruc- 
 tion. For instance, at the Technical University at Darmstadt, 
 there is a library of 800,000 volumes, while that of the Berlin 
 Library amounts to far more than one million volumes. 
 
 "As is the case in all German Universities, the student may 
 attend the lectures to any extent that he may choose, and no roll 
 is called. It is the intention to make of the student an inde- 
 pendent thinker. The attendant is supposed to have reached 
 the age of responsibility at the time he enters the university, 
 having passed through the many grades of upper and lower 
 schools, and having passed through the military service and con- 
 formed to the strict regulations of the manufacturing establish- 
 ments. In all of these, strict discipline is the watch-word. The 
 student is allowed to attain his scholarships at as many uni- 
 versities as he desires, thus getting the advantage of the dif-
 
 408 THE PRICE OP INEFFICIENCY 
 
 ferent methods of prominent professors in the different subjects, 
 
 ''Many students do not take the examination and these re- 
 ceive a certificate of attendance showing the semesters which 
 they attended, as do also the listeners and guests, who are not 
 qualified to take the examination. 
 
 "In addition to the technical universities, there are also nu- 
 merous other technical institutes, such as the Polytechnicum, 
 Technicum, Baugewerk-Schule, Kunstgewerbe-Schule and Mas- 
 chinenbau-Schule, all of which are classified as technical middle- 
 schools or colleges. The number of these is far greater than 
 that of the technical universities, and admission to them is not 
 so much restricted. The degrees which are obtainable by the 
 students of these colleges are those of mechanical engineer, 
 electrical or mining engineer, etc., and some of these colleges 
 confer the degree of Maschinen-Techniker, Electro-Techniker, 
 etc. There are also a number of minor technical schools, all 
 of which are important factors in making up the present high 
 efficiency and high standard of the industries of modern Ger- 
 many. 
 
 "It should always be considered the sacred duty of the pro- 
 moters of engineering education to instil in the minds of stu- 
 dents and to keep before the engineering profession in general, 
 the fact that no great headway can be made as long as the be- 
 lief is prevalent that we know it all and cannot learn from 
 others. 
 
 "Having discussed the system in vogue in Germany for edu- 
 cating the engineer and fitting him for his profession from both 
 a theoretical and practical standpoint, I will compare the Ger- 
 man and American engineers as to standing as well as to their 
 efforts at seeking further knowledge. To expand his knowledge, 
 the German engineer not only serves in a professional way with 
 engineering concerns in Germany, but also gathers experience 
 by so serving with such concerns in foreign countries. The 
 question of salary is, for this reason, not considered by him of 
 first importance. America is usually his Mecca, for he recog- 
 nizes the fact, impressed upon him by German professors, that 
 much information may be gathered there and particularly from 
 American practice. We find this custom encouraged by the 
 government, as well as by the manufacturers and technical so- 
 cieties. It cannot be emphasized too strongly that the rising 
 German engineer does not refuse to believe that much may be 
 acquired from the methods and practice in foreign countries.
 
 EDUCATIONAL SYSTEMS 409 
 
 "For this very reason we find that not only the German 
 manufacturer, but also the individual engineer, eagerly sub- 
 scribes for foreign technical papers which they thoroughly study 
 and for the study of which they are thoroughly equipped as in- 
 dicated by their educational training above cited. This stands 
 out boldly as compared with the custom in America, where the 
 engineer rarely peruses a technical paper published in a foreign 
 language. 
 
 "While it is believed here that most literature of importance 
 is translated, it is, nevertheless, a fact, that the subjects of 
 greatest importance, particularly where higher theories are 
 treated, are seldom translated into the English language. The 
 reason for this is that few American engineers who are masters 
 of the foreign language care to undertake the task, while foreign 
 engineers do not find it necessary, as they understand the orig- 
 inal publication. It is also true that most translations 
 fall short in every respect of being equal in value to the orig- 
 inal. 
 
 "During my ten years of experience and observation in this 
 country, I have found that the American engineer is too apt to 
 take up the first technical work at hand on any special subject 
 and adopt for his work or scheme the ideas or practice suggested 
 therein. It is sometimes claimed that the American engineer 
 is a thorough specialist, but this is not generally true, as he is 
 apt to jump from one line of work to another when there ap- 
 pears to be an inducement in the shape of greater financial 
 gain. In Germany, it is with great difficulty that an engineer 
 can take up some other line of work because of the customs pre- 
 vailing there which must guide his actions. Such proceeding 
 is not looked upon favorably, as he would not be considered as 
 having sufficient practical experience in the new line, and if at- 
 tempted it would be at a financial loss for a few years at least. 
 A ' jack-of-all-trades' is usually supposed to be a master of none. 
 Bearing this fact in mind, it is quite apparent why we have 
 in this country so many failures in connection with engineering 
 undertakings, such as bridges, dams, locomotives, prime movers, 
 and entire industrial undertakings, etc., as compared with the 
 number and magnitude of such failures which occur in Ger- 
 many. 
 
 "A fact which is beginning to dawn upon us is that we must 
 look to Germany for originality and economies or efficiency in 
 engineering propositions. In this country, a proposition which
 
 410 THE PRICE OF INEFFICIENCY 
 
 involves the expenditure of two million dollars for development 
 purposes would not be looked upon favorably. Such a project 
 was the high speed Marienfeld-Zossen line equipped near Ber- 
 lin some years ago to obtain a speed of 125 miles an hour. Ger- 
 man manufacturers for their mutual interest, similarly united in 
 developing gas engines of large capacity. More recently, pro- 
 moters and manufacturers, with the assistance of the govern- 
 ment, united to develop the art of aerial navigation. A great 
 handicap in America is the desire of manufacturers and others 
 who should foster engineering education, to standardize their 
 products for the purpose of greater financial gain. This is un- 
 doubtedly a disadvantage so far as the promotion of the engi- 
 neering profession is concerned. 
 
 "The standing of the American engineer in his profession 
 and in the community cannot be compared with that of the 
 German engineer in his country and we need not seek very far 
 for an explanation. All education receives proper recognition 
 in Germany and the engineer is placed on a social plane with 
 the doctor, the lawyer and the army officer, etc. His compen- 
 sation, as compared with that of mere mechanics, is proportion- 
 ately higher than in this country, so that he is naturally able 
 to occupy a higher plane. The chiefs of departments as well 
 as the consulting engineers and manufacturers, all work in 
 harmony with the subordinates or assistant engineers, design- 
 ers, etc., and are not loath to give credit to whom credit is due 
 for any new designs or creations. 
 
 "The engineers and assistants are all employed under term 
 contracts, and the law prescribes what notice must at least be 
 given to terminate the employment. This ranges from one to 
 three months. It is common practice to engage even assistant 
 engineers for terms varying from one to five years, whereas 
 in America, the unjust practice prevails of laying off such em- 
 ployees as though they were mechanics or laborers, practically 
 without notice, and as soon as the important engineering work 
 is completed. 
 
 "One prominent concern is known to have laid off about one 
 hundred men on a Christmas Eve without giving any notice 
 whatever. It is, therefore, not surprising that a great many 
 well trained engineers drop their profession at the age of thirty 
 years or thereabouts and enter upon vocations in which they 
 may be assured of greater returns. This necessitates the em- 
 ployment of new and younger men when new propositions are
 
 EDUCATIONAL SYSTEMS 411 
 
 at hand, and such men require again to be trained for their 
 
 duties. 
 
 ''This state of affairs is directly chargeable to the engineer- 
 ing profession itself in neglecting to bring about reforms in 
 the customs and remedying of such evils. In Germany the 
 conditions incline the engineer to stick to his post through life 
 and the engineering concerns and manufacturers reap the ben- 
 efit of his accumulated experience and knowledge." 
 
 The system of engineering education in Germany is such that 
 a large number of original researches and technical books re- 
 sult. The engineer, to obtain the advanced titles of Doctor of 
 Engineering, Regierungsbaufiihrer and Regierungsbaumeister 
 and other titles in respective branches must do original work 
 or prepare original theses on the technique of his respective 
 branch. The papers are usually of such high quality as to 
 readily find publishers and thus a body of original literature 
 on every technical subject is built up, which is of the greatest 
 value to the industry. A large number of technical books are 
 published and the total of these with the theses of the ad- 
 vanced engineers amounted in 1910 alone to 10,400 volumes, 
 while the total publication of all technical works throughout 
 the world, including the foregoing, amounted to only 15,540. 
 These figures do not include periodicals. The technical works 
 of the English speaking nations in that year aggregated but 
 2,100 while the French published 2,000. 
 
 It will be seen that an enormous amount of highly valuable 
 scientific and technical material is constantly appearing in Ger- 
 man which is not available to those who do not understand the 
 German language. 
 
 As comparatively few native American engineers and tech- 
 nical men are acquainted with German, it wull be seen why our 
 manufacturers are lagging so far behind and how costly ig- 
 norance of the latest improvements is proving. 
 
 Engineers not only do not know German but do not know 
 the importance of knowing it. A certain engineer, even, in 
 addressing the American Institute of Electrical Engineers, made 
 the astonishing assertion that not one graduate in 10,000 had 
 any real use for German. At another meeting of the society 
 a paper on the subject of high voltage generators was discussed 
 and it was wisely argued that generators of a certain voltage 
 were not practicable, although for five years, just such genera- 
 tors had been in successful operation in a number of continental
 
 412 THE PRICE OF INEFFICIENCY 
 
 plants, and some of much higher voltage had been installed. 
 
 An amusing sidelight on this exliibition of ignorance and in- 
 competency soon shone forth from a London periodical which, 
 in equal innocence of German progress, announced that such 
 generators (those of the lower voltage) were soon to be built 
 in America, and that further interesting developments were in 
 prospect. 
 
 The three wise men of Gotham are certainly put to the blush 
 by the plight in which these eminent engineers find themselves 
 through their ignorance of the German language. 
 
 The enormous cost to the public of the ignorance of our en- 
 gineers in regard to advanced German practice is too frequently 
 demonstrated. The writer had the good fortune to be connected 
 with a prominent engineering undertaking for the generation 
 of electric power, and before the plant was entirely completed 
 had occasion to make a report on the efficiency of the plant which 
 showed that an annual saving in operating expenses of $200,- 
 000 could be made by the adoption of German methods. When 
 such methods were actually put in operation the saving proved 
 to be even larger. A saving of over $1,000,000 in the construc- 
 tion cost of the plant could have been effected had the engi- 
 neers in charge been at the outset familiar with good Ger- 
 man practice, which of course is not to be had from books 
 alone. 
 
 The value of German methods is better understood by some 
 Englishmen than by Americans, as the following, which is a 
 quotation from a speech delivered in the British Parliament, 
 shows : 
 
 "One of our greatest failures is that less than one per cent, 
 of our engineers and officers understand the German language 
 so that everything we wish to know of German progress must 
 come to us second-hand in insufficient and delayed translation; 
 to-day we are at a point where Germany is able to build ten 
 ships against our one ; we have to learn to imitate Germany. ' ' 
 
 Germany does not despise American progress or seek to be- 
 little and obstruct it, but in fact is only too anxious to take 
 advantage of all American advances. The American Institute 
 in Berlin exchanges publications of value with the Smithsonian 
 Institute and promotes the translation of all w^orks likely to 
 be of value to German progress. 
 
 One of the results of the German system is seen in an analy- 
 sis of the awards of the Nobel prize. As is well known, the
 
 EDUCATIONAL SYSTEMS 413 
 
 Nobel foundation is based upon the will of Dr. Alfred Bern- 
 hard Nobel, the Swedish engineer, chemist and inventor of 
 dynamite, who died in 1896, leaving an enormous fortune. 
 
 Each of the five annual Nobel Prizes is worth $40,000. They 
 are awarded for the most important discoveries or improve- 
 ments in (1) physics, (2) chemistry, (3) physiology or medi- 
 cine, (4) for the most distinguished work of an idealistic tend- 
 ency in the field of literature and (5) for the best effort toward 
 the fraternity of nations and the promotion of peace. 
 
 In some cases the prize is divided between two competitors. 
 The following list summarizes the awards given up to 1911, 
 The number of recipients of prizes and half prizes is given 
 followed by a figure in brackets showing the value in full prizes : 
 
 Germany, 16 (15) ; France, 12 (74) ; England, 7 (7) ; Hol- 
 land, 3 (2) ; Italy, 4 (2|) ; Switzerland, 4 (24) ; Sweden, 3 
 (24); Denmark, 2 (H) ; Spain, 2 (1); United States, 2 (2); 
 Austria, 1 (1) ; Belgium, 1 (1) ; Norw^ay, 1 (1) j Russia, 1 
 (1), and Poland, 1 (1). 
 
 Two societies whose whole purpose is the promotion of peace, 
 have each received a full prize, making a total of fifty full 
 prizes divided among 62 competitors. 
 
 The German prizes have been as follows: Physics, 3 (2^); 
 Chemistry, 6 (6); Medicine, 4 (3^); and Literature, 3 (3). 
 Thus Germany has received in full prizes twice the aggregate 
 of the next competitor, but it has received no prize for peace; 
 the prize records in physics, chemistry and medicine being 
 largely the result of the splendid system of educational train- 
 ing. The United States has but two prizes, one for physics 
 and one for peace. In the last award, however, that of 1912, 
 a third prize, in medicine, has come to the United States. 
 
 The German educational system is constantly under scrutiny, 
 and its creators adopt any improvement of value that is evolved. 
 A late feature of importance is the idea of exchange professors, 
 which is being carried out between German and American uni- 
 versities and which is proving of great value to both countries. 
 
 To those who are familiar with various educational systems, 
 the superiority of the German system is obvious. It is being 
 adopted in whole or in part by many other countries and the 
 education of the world in the near future is likely to be largely 
 along the lines of the German system.
 
 CHAPTER XXVI 
 THE EEMEDIES 
 
 In considering the evils which affect the United States, be- 
 ginning with the most obvious, the defective political system, 
 and continuing through the long list, the one which upon anal- 
 ysis appears to be the basic factor in present conditions, is the 
 educational system. If that be remedied, the remedying of 
 the others will follow in time. 
 
 America is pausing now, like a spendthrift who by accident 
 first runs his fingers to the bottom of a supposedly bottomless 
 pocket. The chilling idea that our national resources are not 
 boundless; the realization that we are getting down to par 
 mth other nations; that our national existence is open to the 
 same dangers and threatened by the same causes that give con- 
 cern to other nations, is upon us in all its grim reality. 
 
 Like a youth, a few months out of college, who sees that the 
 world is not his walnut after all, to crack as he will, America is 
 passing into a new era, one of more or less gravity and cer- 
 tainly of less enthusiasm. America is face to face with the 
 serious business of being a sorely tried nation among sorely 
 tried nations, with every problem to meet and solve that other 
 nations face, and no longer the most favored of lands. While 
 its opportunities are still boundless, its duties are more sharply 
 defined, and the discipline of existence has laid its hand on the 
 nation, as it lays its hand on each individual as he comes to 
 man's estate. 
 
 America's most pressing problem is education, for education 
 is the fountain head of all national progress. Educational 
 standards must be raised, a more efficient system of control 
 evolved, and moral training must be included. The conscience 
 of the coming generations must be developed, for conscience is 
 as capable of development as any other faculty. 
 
 The principal office of government is to enforce a relation of 
 justice between those composing it or under its jurisdiction. 
 This is a highly complicated and costly operation at present, 
 and is the principal burden of civilization. 
 
 414
 
 THE REMEDIES 415 
 
 Every individual must work many weeks of each year to 
 meet the cost of enforcing just relations between his neighbor 
 and himself, a toil which savages escape by being ready to risk 
 their lives in defending themselves from injustice. 
 
 Proper moral training cannot fail to greatly reduce the total 
 of unjust, careless and neglectful acts ; the prevention and pun- 
 ishment of which make government so costlj^ Conscience is 
 thus the greatest of all economic and social factors, the great- 
 est single item in the composition of civilization. 
 
 Next in importance in educational reforms, must be the con- 
 tinuation of education until the individual has a means of 
 earning a livelihood at his command, not the discarding of 
 studies at an early age, and an aimless drifting around into 
 some unsuitable occupation. The state owes itself the duty of 
 seeing that its coming citizens are put on the right road. 
 Training must be compulsory up to the age of 18, and the 
 learning of some trade or profession obligatory. 
 
 A system must be devised, also, for securing for each occu- 
 pation a ratio of apprentices proportionate to its demands, and 
 a method for discouraging the influx into the professions of 
 those whose abilities are better suited for the trades. America 
 is crowded with incompetent lawyers, bad doctors, poor teach- 
 ers and underpaid clerical people, who might have much more 
 profitably been good mechanics and famous carpenters. 
 
 The whole development of the nation, now becoming more 
 and more a manufacturing country, will depend upon the es- 
 tablishment of better relations between business men among 
 themselves, and between them and their employees. The cap- 
 italist must realize that the welfare of the business man is of 
 the highest importance, that the prosperity of a country is 
 largely determined by the body of business men it contains, a 
 country having a large proportion of active, bright, aggressive 
 and ambitious business men, all striving for new results and 
 perfections of every kind, will outstrip a country in which love 
 of ease and lack of progress characterize its business men; in 
 which factories are allowed to run themselves, customers con- 
 sidered a necessarj?^ evil and the best hours spent in the refine- 
 ments of pleasure. 
 
 In massing itself in large trusts, capital exterminates the 
 business men of the country. It reduces them to the level of 
 employees and dries up the springs of initiative, and capital in 
 consequence, reaps a low rate of interest, whereas distributed
 
 416 THE PRICE OF INEFFICIENCY 
 
 in the hands of a numerous body of business men, it would be 
 put to much more effective uses. 
 
 The small business men who fall victims to the trusts disperse 
 in three directions. Some still unwilling to give up their inde- 
 pendence, struggle along in other lines by hook or crook, too 
 often by crook; others become employees of the trusts and the 
 third class become commercial derelicts, picking up whatever 
 living they can or becoming minor wage earners in some clerical 
 capacity. 
 
 Thus one of America's greatest assets must be better eon- 
 served, her business men, for they are cleverer than the wage 
 earners and are keen, driving forces of progress, not merely 
 the cogs in the wheels. They employ the bulk of the labor and 
 being closer to labor are less oppressive as employers, besides 
 furnishing, by not being at too great an interval away from 
 labor, an incentive for the ambitious wage earner to look for- 
 ward to the time when he will be able to join their class. 
 
 The relations of employers and employees must undergo a 
 radical change of tone. Means must be found of identifying 
 their interest more obviously. If either the employers or the 
 employees stop to consider the matter, it will readily be seen 
 that their interests are identical, though this is a point of view 
 not usually taken. Neither can exist without the other and the 
 respective positions they hold are determined by a multiplicity 
 of factors which are largely controlled by natural laws. The 
 employer who gets the most out of his men will succeed best in 
 the end, but the most cannot be gotten out by driving, and the 
 employee who gets the most out of his employer will succeed 
 best, but getting the most out of the employer is not accom- 
 plished by grudging work and dynamite domination. 
 
 Labor troubles frighten capital away and the wage earner 
 must force out of that left, a wage which he might readily ex- 
 ceed if his conduct encouraged new employers to come in com- 
 petition for his labor. 
 
 Although invention, by giving capital control of the "imple- 
 ments of production," the favorite phrase of the socialist, 
 has greatly altered the conditions under which labor is per- 
 formed, this altered condition is not permanent. In the last 
 century, owing to the triumphs of invention, vast savings have 
 been effected, and the world is much wealthier than in previous 
 generations. This great increment of wealth has been accumu- 
 lated by the trusts, but measures will be taken to prevent its
 
 THE REMEDIES 417 
 
 further accumulation in their hands, so that a better diffusion of 
 wealth will take place, particularly as the new wealth which will 
 be increased by future inventions will come into competition with 
 existing wealth, to the benefit of the wage earner. Natural laws 
 which govern the proportionment of profits between capital and 
 labor in accordance with their respective supply cannot be per- 
 manently overcome. With capital plentiful, the banks full of 
 money and laborers scarce, the laborer will receive a larger 
 wage, but with capital scarce, and banks having little on hand 
 to lend, with laborers very numerous, the wage of the laborer 
 will be smaller. 
 
 Under modern conditions, the wage earner enjoys a vast 
 propaganda as to his rights and privileges. A constant and 
 proper effort for the betterment of his condition is being made 
 by politicians seeking his vote, by societies of various sorts, by 
 his own unions and by the more progressive employers. With 
 all these agencies working for him, it is reasonably certain that 
 the workingman will receive his just proportion of profits. 
 Yet beyond the gains that are fought for and won for him, he 
 should receive an additional liberality, simply because it will 
 pay. The prosperity of all depends on the prosperity of the 
 worker, and in contributing to his welfare, the welfare of all is 
 advanced. 
 
 In the immediate future, the most feasible scheme of better- 
 ment is in continuation education, and in the three forms of 
 social insurance, accident, sickness and old age. To relieve the 
 worker of hardship and anxiety is to enable him to devote him- 
 self with greater effect to his daily task. 
 
 A thoroughly organized effort should also be made to establish 
 a system of distribution of labor, so that the idle workers in one 
 part of the country may be transferred to the places where em- 
 ployment is to be had. At the same time, immigration should 
 be scattered properly, both for the benefit of the immigrants 
 and the country. These are duties which the government owes 
 to its citizens. 
 
 Vitally necessary is a better understanding between employ- 
 ers and employees, and the capitalist, as indicated, must take a 
 more progressive and wholesome attitude towards the employees 
 of capital, those who work in capital's interest, the business 
 men. The destructive system of American banking must be 
 fundamentally reorganized. 
 
 Capital which is managed with liberality and foresight ac-
 
 418 THE PRICE OF INEFFICIENCY 
 
 complishes vastly more for itself and for the welfare of the 
 country than capital directed iu the usual hardshell "show-me" 
 spirit which dominates at present. 
 
 Inventors must be given a square deal, business must get a 
 fair opportunity, and the spirit of initiative and encouragement 
 must pervade capital as well as all branches of commerce to 
 accomplish the results that should be accomplished. 
 
 A better understanding must be brought about between capi- 
 tal and government, for under present conditions, the same 
 distrust and animosity and antagonism which characterize the 
 relations of labor and capital, extend to capital and the govern- 
 ment. The employer is a step above the wage earner, the 
 capitalist a step above the employer, and the government a step 
 above the capitalist, but here the vicious circle begins again, 
 because the government is the wage earner en masse; very im- 
 perfectly expressed but nevertheless the voice of the people and 
 the voice of God. 
 
 The government as it now exists not only is an imperfect ex- 
 pression of the will of the people, but in many respects is an 
 actual distortion, for capitalism, in a spirit of insubordination, 
 has sought to control the force by which it must in the natural 
 order of events inevitably be controlled, the will of the people, 
 for the will of the people is all powerful and the only power, 
 and if its admonitions are deliberately and contumaciously re- 
 jected, it may turn and with a single act of confiscation level 
 on a fatal day the exploitation of generations and of centuries. 
 
 The government as it is now constituted is a house divided 
 against itself. The law makers and those who execute the law 
 are some serving the public and some capital, and the govern- 
 ment thus commands no respect and accomplishes nothing. In 
 desperation it tears at the structure of business and creates dis- 
 trust and alarm, but at the same time its efforts are not regarded 
 as being made in good faith, and are seen to affect no good re- 
 sult. 
 
 Trusts are neither broken up nor allowed to Avork the bene- 
 fits of which they are capable. In order to handle the great 
 business undertakings which modern conditions demand, great 
 corporations are necessary. They are economically good and 
 produce results in efficiency which the small organization can- 
 not rival and the trust can serve the public better than the 
 smaller dealer. The true interest of the public is in drawing 
 the monopolistic fangs of the trust, but at the same time pre-
 
 THE REMEDIES 419 
 
 serving its useful features, and if our sj'stem of government 
 were a good one, this result could be accomplished. But the 
 lack of competent and faithful officials, the presence of un- 
 trained politicians and official favorites, and the lack of single- 
 ness of purpose in the government undermines its efforts and a 
 chaotic condition exists, which must soon be remedied if we are 
 not to encounter far more serious conditions than any we have 
 thus far had to contend with. 
 
 At the root of the matter is the canker of inefficiency. Every- 
 where, in every department of public life, with only sporadic 
 exceptions, the wrong thing is done and inexperience and in- 
 competency flourish in the graveyard of prosperity. There is 
 not an industry, not a factory, store or shop, that does not halt 
 at the prospect of uncertainty and agitation. The nation is 
 cursed by politics and burdened by the great twin evils of busi- 
 ness in polities and politics in business. The will of the peo- 
 ple is strangled by an antiquated system, by incompetency, bad 
 faith and the disgraceful struggle for personal advantage in- 
 dulged in by office holders. Instead of officials who when as- 
 sailed in office, tender their resignation and thus throw into 
 confusion their detractors when their motives are questioned, 
 we have a stripe of office holders who cling to office to the last 
 extremity and destroy respect for themselves and for the office 
 they hold. 
 
 Above all is the pernicious and outrageous sacrifice of the 
 interests and welfare of the people for the sake of partisan 
 politics. Nero is said to have played the fiddle while Rome 
 burned, but he certainly could not have played it more industri- 
 ously than our office holders play politics while prosperity is 
 vanishing in smoke. 
 
 At this time, when the most vital of business questions is be- 
 fore the public, the determination of the fate of the great cor- 
 porations, there is absolutely no hope of an immediate solution. 
 The whole fabric of business is shaken; doubt, uncertainty and 
 stagnation prevail and no solution of any kind is in sight. All 
 must wait while ruin overtakes, that the interminable processes 
 of our political system may spin themselves out in their accus- 
 tomed way; still further delayed by the unconscionable 
 struggle for political advantage among groups of office holders 
 who style themselves political parties. 
 
 At times we have a president of one political complection, 
 and with remarkable fortune, a congress of another. It w^ould
 
 420 THE PRICE OF INEFFICIENCY 
 
 be an unthinkable thing under such circumstances for them 
 to consult the welfare of the country first and act in con- 
 cert in the emergency, and divide the credit afterwards. In- 
 stead, however admirable the legislation which Congress may 
 enact, however patriotic and charged with public welfare it 
 may be, no president of another group of office holders could 
 dream of lending his approval to it; and knowing this, the pa- 
 triots of congress can fairly revel in admirable legislation, which 
 they would not dare to pass if they thought it would be ap- 
 proved. Thus is politics played and the president "put in a 
 hole." And as for the president, who imparts in his messages 
 information to congress as to the condition of the country, which 
 they know more about than he does, we may be sure that how- 
 ever wise and beneficent may be his admonitions, a congress 
 composed of a rival group of office holders will never lend an 
 ear to it. 
 
 Each side will, however, endeavor to extract as much political 
 credit from the situation as possible and seek to cover their 
 opponents with the greatest possible discredit; but of honest 
 effort for the welfare of those on whose earnings they fatten, 
 there will be little or none. 
 
 Why should not remedial legislation be made possible in an 
 expeditious manner? Why should there be such interminable 
 delays? Who benefits by it? Not the public, certainly? 
 
 The directors of the great oil trust meet daily. No question 
 in its policy or business can arise in any part of the world which 
 cannot be settled in twenty-four hours by the highest authority. 
 Yet in our government, the trust question has not been settled 
 in twenty years, and there is absolutely no legal question of 
 vital importance that can be settled by the government in less 
 than three or four years. Why should a corporation have a 
 better system than the government? Why should it be efficient 
 and the government inefficient? 
 
 The question always comes back to the nature of our political 
 system. We live under a constitution which is ineffective and 
 antiquated, which was formulated by men of wealth in the in- 
 terests of what is now known as "interests" and not as was so 
 speciously promised, in the interests of the people. 
 
 It is a constitution which proclaims the right of life, liberty 
 and the pursuit of happiness, but which makes living so costly 
 that one man in twelve is buried in the potter's field; it pro- 
 vides that no cruel or unusual punishment shall be inflicted,
 
 TH"E REMEDIES 421 
 
 yet daily men are being made eunuchs in state prisons, a bar- 
 berous custom tolerated in no other civilized nation under the 
 heavens and a reproach to humanity; it is a constitution which 
 guarantees liberty, but under which there is less liberty than 
 possessed by the subject of any constitutional monarch of 
 Europe. It is a constitution which divides with scrupulous 
 care the departments of the law's making, the law's execution 
 and the law's interpretation, but under which the president has 
 powers greater and more autocratic than any king in Europe, 
 and in which the judiciary has greater power than is to be found 
 in any similar body, yet in which the laws delays are a denial 
 of justice nowhere else exhibited. It is a constitution which 
 provides a government of laws, but under which lawlessness is 
 widespread and rampant, and it assumes to be a system of no tax- 
 ation without representation ; yet it creates a class of representa- 
 tives who instead of attending to the people's business, are chiefly 
 concerned in exploiting their constituency, in continuing them- 
 selves in office and in utilizing public distress for political ad- 
 vantage. The constitution subverts the will of the people, and 
 it is an antiquated and imperfect system. It should be reor- 
 ganized and made an instrument of progress, of liberty and of 
 equality. This is the duty that the public owes itself, a duty 
 which should not be performed piecemeal, but thoroughly and 
 forthwith. 
 
 Under the present system, inefficiency costs at the lowest esti- 
 mate, over a hundred and ten dollars a year for each person 
 and for the 33,000,000 Avage earners, not less than $5.75 per 
 week per wage earner. These are conditions, not theories! 
 "Whose hand is in the public's pocket to this depth, and why do 
 we allow the disgrace and robbery to continue? 
 
 ******** 
 
 The first whine that incompetency has to make for itself, when 
 brought face to face with foreign improvements, is that the im- 
 provements are not applicable to local conditions. 
 
 This is a foul excuse, the product of jealousy; it is the first 
 and readiest excuse of those who are lacking in energy and 
 initiative and who prefer sloth and ignorance to progress and 
 public welfare. 
 
 It is typical of the official and the hog-mannered business man 
 whose only idea of progress is to fatten but who must be forced 
 aside if any real progress is to be made. 
 
 Although it is humiliating to the jingoism of those who are
 
 422 THE PEICE OF INEFFICIENCY 
 
 convinced that every improvement of any consequence if it does 
 not originate in their own sphere must be deprecated and de- 
 clared an absurdity and fought at every point ; it is nevertheless 
 true that the nations and individuals who make the greatest 
 progress are those who adopt improvements whenever they are 
 to be found and who from such points of vantage, move on to 
 new improvements of their own, and this is true not only of 
 nations and individuals, but also of municipalities, trade organi- 
 zations and corporations. 
 
 In all departments of life, too, those who thus fight against im- 
 provements are those also who show the greatest of contradictions 
 in their positions. 
 
 For example, government ownership of telegraph and cables 
 is opposed, yet the government conducts the post office, and the 
 proposition to turn it over to private capital is never advanced ; 
 municipal traction and electric lighting systems are violently 
 opposed, yet the water supply systems of cities are in almost all 
 instances controlled, owned and operated by the municipalities 
 themselves ; violent opposition is shown to fixing maximum prices 
 of trust products and prevention of the monopolization of nat- 
 ural resources, yet the Interstate Commerce Commission by fix- 
 ing rates stands between the public and railroad extortion and 
 prevents monopolies of transportation, and while activities of 
 the Government in the fostering of foreign trade are criticised, 
 yet the most paternalistic of devices, the tariff, protects favored 
 manufacturers. 
 
 These are but a few examples of the contradictions so apparent 
 in American institutions and numberless others could readily 
 be cited in every phase of public and private enterprise, and fur- 
 ther not only not satisfied with refusing to look around and see 
 what improvements are to be had, self-sufficient officials, when 
 finally aroused, are too often to be seen going through with 
 lengthy and expensive experiments with much loss of time and 
 waste of money to ascertain facts which have already long been 
 known to those who are familiar with conditions. This is a mole- 
 like attitude which would be amusing were it not so tedious and 
 criminally expensive. 
 
 And too often when improvements are adopted it is long after 
 their foreign usefulness has been exhausted, still later improve- 
 ments having taken their place abroad. This is a kind of second 
 hand progress Avhich is not much better tlian the original old 
 fogyism.
 
 THE REMEDIES 
 
 423 
 
 It wiU be self evident that many of the improvements which 
 have been outlined in this volume will ultimately be adopted, but 
 only as has been the case with numerous improvements in the 
 past, after interminable delays and the squanderings of great 
 sums of money. 
 
 It should accordingly appeal to the public reason, that un- 
 necessary delay and self interested opposition to proven advan- 
 tage so obviously within reach, are nothing less than crimes 
 against progress and the welfare of humanity. 
 
 Why then it may be asked are such crimes tolerated? 
 
 And who is responsible?
 
 \ 
 
 \\ 
 
 \
 
 INDEX
 
 INDEX 
 
 Abuses, in congress, 159. 
 Academies, German, 400. 
 Accidents, 45. 
 
 compensation, 328. 
 
 insurance, 316, 322. 
 
 in mines, 46. 
 
 in transportation, xviii. 
 Account, carrying the, 232. 
 Adler, Dr. Felix, 307. 
 Administration, 131. 
 
 waste, xviii, 22. 
 Administrative inefficiency, 33. 
 
 graft, xiv. 
 
 personal, 5. 
 Administrators, expert advisers to, 
 
 107. 
 Advertisements, ultimate cost of, 
 
 360. 
 Aeroplanes, 172. 
 
 Advisers, experienced technical, 107. 
 Aviation deaths, 332. 
 Agriculture Department, 33. 
 
 horses, 64. 
 
 neglect of, xiv. 
 Air nitrate, 258. 
 Alarms, fire, 58. 
 Albert, Talbot J., 111. 
 Alcohol consumption, 240. 
 Aldermen, board of, 145. 
 Aldrich, Senator, 23'. 
 American architecture, 121. 
 
 aviation, 179. 
 
 business men, 215. 
 
 civilization, 346. 
 Americans, duty of, to America, 6. 
 American, Education, 393. 
 
 engineers, 161. 
 
 vs. Germany, xxi. 
 
 vs. German mechanics, 329. 
 
 government, 166. 
 
 institution, 422. 
 
 inventors, 167. 
 
 iron industry, 264. 
 
 laws, 216. 
 
 liberty being destroyed, 10. 
 
 magazine, the, 308. 
 
 427 
 
 American Medical Association, 
 Journal of, 341. 
 
 patent system, 167. 
 
 pausing, 414. 
 
 pioneer inventions, 160. 
 
 pluck, xii. 
 
 Prison Association, 342. 
 
 politics, grade of men, 158. 
 
 problem, 116. 
 
 public, 346. 
 
 sentiment, 332. 
 
 voice of, 162. 
 
 methods of education, 391. 
 
 wealth, 78. 
 Ambassadors, technical advisers to, 
 
 30. 
 Americanized immigrants, 370. 
 Americanizing a play, 67. 
 Anglo-Saxon strains, 114. 
 Animals, waste of, xviii. 
 Annual fire loss, 55. 
 Annoyances, 359, 374. 
 Appellate Courts, 20. 
 Application for position of Mayor, 
 
 106. 
 Architecture, American, 121. 
 Armament, cost of, 31. 
 Army, shame of our, 301. 
 
 deserters, 302. 
 Art of cooking, 366. 
 Arrests, spectacular. 236, 237. 
 Atlantic Monthly, The, 98, 163, 195, 
 
 320, 391. 
 Auctioneers, 227. 
 
 Aliens, money contribution of, 288. 
 Austin dam, 262. 
 Authority, respect for, 105. 
 Autocracy, 144. 
 Automobiles, 361. 
 
 manufacture, communal, 209. 
 
 racing, 331. 
 Aviation, father of, 178. 
 Ax grinding, 250. 
 
 B 
 
 Baensch, 106. 
 Baker, E. W., 175.
 
 428 
 
 Bakeries, 365. 
 Ballin, Albert, 108. 
 Ballot, primary, 13. 
 Baltimore Sun, 300. 
 Banks, organization of, 232. 
 central co-operative, 99. 
 profits of, 232. 
 in U. S., 221. 
 Bankers and brokers, 233. 
 Banking facilities, 245. 
 Barbarism, 345. 
 Basle's death, S'32. 
 Baseball craze, 339. 
 
 fan, 338. 
 Becker, Lieutenant, 373. 
 Beer consumption, 240. 
 Belgium relief societies, 299. 
 Benedict, Justice, 382. 
 Berlin, City of, 267. 
 
 Merchants' Corporation, 402. 
 BernstorflF, Count von, 126. 
 Bethlehem Steel Co., 308. 
 Betrayers of young girls, 308. 
 Birds, damage by, 41. 
 Birkeland, Prof., 259. 
 Bismark, 4, 7, 100. 
 doctrine, 293. 
 remark, 151. 
 remedy, 4. 
 policy, 97. 
 Blackmailing, 216. 
 fine art of, 233. 
 Black, Senator L. M., 20. 
 Blatchfort, Robert, 91, 92. 
 Board of Aldermen, 145. 
 Bosses, the, 12. 
 Boxing, 336. 
 Bread, balanced, 243. 
 British don'ts, 255. 
 dreams, 255. 
 government, 253. 
 iron industry, 264. 
 nation, 255. 
 press, 252. 
 student, 264. 
 stupidity, 254. 
 trade unions, 299. 
 Bread, hot, 243, 365. 
 Books, technical, 411. 
 Brown, Thomas, 25. 
 Brokers, 224. 
 
 Brutality in business, 221. 
 Buerger, Schule, 395, 396. 
 Bull-fighting, 335. 
 Burgherr, German, 126. 
 Bureaucrats of Germany, 11. 
 Building laws, 246. 
 
 INDEX 
 
 Buildings, grouped, 134. 
 
 of road, 54. 
 
 for working men, 244. 
 Business, brutality in, 221. 
 
 is business, 215. 
 
 of German government, 101. 
 
 man in the U. S., 107. 
 
 man's loans, 229. 
 
 men snuffed out, 224. 
 
 men of to-day, 273. 
 
 men's failure, 221. 
 By-products, 39. 
 
 
 
 Callaway, Representative, 25. 
 Calver, Richard, 110. 
 Canal, electric haulage, 271. 
 
 systems, 266. 
 Candidates for oflJces, 12. 
 
 for presidency, 156. 
 Canker of inefficiency, 419. 
 
 destroys liberty, 10. 
 Capita, loss per, xxi. 
 Capital, concentrated, 74. 
 
 and labor, 79, 182. 
 Capitalistic employers, 183. 
 Capitalists, central groups, 76. 
 Care of working people, 317. 
 Carnegie, 309. 
 Carnegie Restitution, 311. 
 Caro, Nikodemus, 259. 
 Cartels, German trust. 111. 
 Catholic Religion, 389. 
 Cattle, 366. 
 Cavendish, 259. 
 Central co-operative bank, 99. 
 Changing names, 291. 
 Chanute, Octave, 177. 
 Chemicals, 367. 
 Chemistry, 38. 
 
 modern, 257. 
 Child labor, 193, 307. 
 Chili saltpeter, 258. 
 Chinese badge of honor, 250. 
 Christiania, 259. 
 Christian religion, 3'90, 393. 
 Cicero, 91. 
 
 Citizens, future, 381. 
 City Beautiful, 134. 
 
 building in Germany, 124. 
 
 factor in life, 115. 
 
 government, 16, 247. 
 
 growth, 116, 138. 
 
 individuality, 119. 
 
 planning, 137. 
 
 planning, principle of, 140.
 
 INDEX 
 
 429 
 
 City water supply, 56. 
 
 water, waste of, xviii. 
 Civilisation, American, 346. 
 
 future, 124. 
 
 Romans, 139. 
 
 work of, xxiii. 
 Civil war, cost of, 26. 
 Class distinction, 82. 
 Coal by-products, 38. 
 
 mining, accident, 46. 
 
 production, 37. 
 
 waste, xvii, xix. 
 Colbert, 8. 
 Columbus, 394. 
 Comenius, 394. 
 Cornerstone of progress, 104. 
 Commerce, stimulating, 248. 
 Commercial Academy, 405. 
 
 code, 401. 
 
 functions of a state, 86. 
 
 training, 401. 
 
 Schools, 400. 
 Commission government, 142. 
 
 government in Japan, 144. 
 Commissioners, governmental, select- 
 ing, 146. 
 
 of labor, 326. 
 
 of patents, 169. 
 Common law, 97. 
 
 people bearing the losses, 222. 
 
 school in Germany, 303. 
 
 sense practice, xvii, xix, 321. 
 Communal advertising, 209. 
 
 industry, 203. 
 Complaints against patent office, 
 
 170. 
 Competition in Germany, 217. 
 
 with trusts, 210. 
 
 restoring, 72. 
 Complaint books, 375. 
 Compulsory education, 393'. 
 
 insurance, 325. 
 Concerts, sacred, 118. 
 Concentrated capital, 74. 
 Councils, town, 126. 
 Contradictions, Edison's, 239. 
 Confidence, destruction of, xiv. 
 Congress, 158, 420. 
 
 abuses in, 159. 
 Congressmen, 17, 157. 
 Conservation committee, 36. 
 
 of human life, 44. 
 
 what it is, 32. 
 Constitutional monarchy, 153. 
 Constitution, defective, 159. 
 
 of U. S., 150, 152, 343. 
 
 failure to modernize, xiv. 
 
 Consumers' Clubs, 355. 
 
 union, 346. 
 Continuation schools, 392. 
 Contradiction in American, 383. 
 Control of children, 380. 
 
 of industry, 74. 
 
 of legislatures, 15. 
 Conventions, 14. 
 
 systems of, 13. 
 Convicts, 342. 
 Cooking, 349. 
 
 art of, 366. 
 
 by electricity, 287. 
 Copernicus, 394. 
 Copper, production, 37. 
 Copyright system, 176. 
 Cosmopolitan Magazine, 243, 252, 
 
 301. 
 Cost of Fire Insurance, 58. 
 
 of Civil War, 26. 
 
 of ignorance, 412. 
 
 of living, 190, 359. 
 
 of school maintenance, 395. 
 
 of sickness, 49. 
 Courts, Appellate, 20. 
 
 of Commerce, 263. 
 
 power of, 155. 
 Country of contradiction, 383. 
 
 of soldiers, 402. 
 Crimes, 344. 
 
 of the Pork Barrel, 268. 
 Criminals, 372. 
 Crisis in America, xiv. 
 Crops, waste of, xviii. 
 Crowe, Col., 334. 
 Crown Prince, German, 21. 
 Currency, 230. 
 
 Cutting out the middleman, 346. 
 Cyanamid, 260. 
 
 D 
 
 Daily expenses, S'47. 
 Daniel in the lion's den, 118. 
 Dare devil drivers, 3S1. 
 Dead mass of currency, 234. 
 Death rate among wage earners, 49. 
 
 aviation, 332. 
 Declaration of Independence, 305. 
 Defects of Constitution, 153. 
 Dehmel, Richard, 239. 
 Delays, legal, 21. 
 Democracy, 144. 
 Dentistry,' 366. 
 Depredations, 381. 
 Depravity, 344. 
 Derelictions, 387.
 
 430 
 
 INDEX 
 
 Deserters from the Army, 302. 
 Des Moines plan, 143. 
 Destruction of confidence, xiv. 
 Destructive patent system, xiv. 
 Deutschland als Weltmacht, 322. 
 Development of educational system, 
 405. 
 
 water-power, 42. 
 Dictator of Finance, 82. 
 Diesel engines, 162. 
 Diplomacy, German, 248. 
 Diplom Ingenieur, 406. 
 Discharge of engineers, 410. 
 Discipline, 388. 
 
 of children, 380. 
 Diseases, 377. 
 
 industrial, xiv. 
 
 preventative measures, 53'. 
 
 workmen, 51. 
 Dishonesty, official, 10. 
 Disrespect for law, 343. 
 Distress work, 297. 
 Distribution of wealth, 256. 
 Distrust in business, 219. 
 Divorce, 18, 379. 
 Doctor Engineer, 411. 
 Domestic constraints, 321. 
 Domestic relations, 379. 
 Dooley, W. H., 163, 195, 198, 391. 
 Dortmund-Ems canal, 267. 
 Dreadnoughts, English, 386. 
 Dreams, British, 255. 
 Dreher, William C, 98, 320. 
 Drift towards socialism, 98. 
 Drinking, 242. 
 Drugs, 368. 
 Duma, Russian, 158. 
 Dunn, A. W., 23. 
 Duty of the state, 304. 
 
 of Americans to America, 6. 
 Dutch windmill, 275. 
 Dwellings, 127. 
 
 E 
 
 Earnings of wage earners, 193. 
 Eastern trade, 249. 
 Economy, 22. 
 
 of fuel, 39. 
 
 lesson in, 184. 
 Edison, Thomas A., 235, 238. 
 Edison's contradictions, 2S'9. 
 
 tradition, 174. 
 Education, 383. 
 
 campaign, 386. 
 
 engineering, 162, 295. 
 Educational reform, 414. 
 
 Educational system, xiv, 385. 
 
 methods, 390. 
 Effects of commission government, 
 147, 156. 
 of law, 20. 
 Efficiency movement, 199. 
 
 of workingmen, 329. 
 Eggs, waste of, xix, 65. 
 Elbe, the, 267. 
 Electrical engineering, 174. 
 Electric railway, 410. 
 
 canal haulage, 271. 
 
 farming, 175, 271. 
 
 lamps, 174. 
 
 plowing, 278. 
 
 Review, 272. 
 
 World, 166, 174, 184. 
 Elective offices in Grermany, 107. 
 Elevated roads, 130. 
 Eliot, Dr. Charles W., 305. 
 Emperor Wilhelm, 243. 
 Employees, 414. 
 Employers, 416. 
 Employer and employee, 182. 
 Employment insurance, 300. 
 
 of women, 326. 
 Emerson, Harrington, 69. 
 Engineers, American, 161. 
 Engineer and farmer, 272. 
 
 doctor of, 411. 
 
 licensed, 185. 
 Engineering education, 162. 
 
 education in Germany, 404. 
 
 failures, 262. 
 
 Magazine, 6, 69, 78, 199, 260, 
 388. 
 
 modern, 257. 
 
 News, 160. 
 
 undertakings, 123. 
 Engines, Diesel, 162. 
 England's complaints of Germany, 
 403. 
 
 statesmen of, 250. 
 
 waking up, xiv. 
 
 bugaboo, 251, 
 
 colonies, 249. 
 
 educational campaigns, 386. 
 
 dreadnoughts, 386. 
 
 illiterates, 386. 
 
 newspapers, 252. 
 
 speaking nations, 411. 
 
 trade, 403. 
 Englishmen's naturalization, 284. 
 Enterprises, communal, 212. 
 Equitable fire, 59. 
 Europe, effete nations of, 161. 
 European practice, 261.
 
 INDEX 
 
 431 
 
 European public, 346. 
 
 Europe, United States of, 17. 
 
 Evans, Powell, 56. 
 
 Evil efifects, 414. 
 
 Evils of business, 419. 
 
 Exchange of Professors, 413. 
 
 Exhibition flights, 333. 
 
 Expert advisers to Administration, 
 107. 
 
 Experienced technical advisories to 
 government and municipal poli- 
 tics, 107. 
 
 Extras, newspapers, 361. 
 
 Extravagance, governmental, 22. 
 due to advertising, 360. 
 
 Eyde, S., 259. 
 
 F 
 
 Factory sanitation, 50. 
 Failures of business men, 221. 
 Fairchild, Henry P., 284. 
 False representation, 218. 
 Family, the, 380. 
 Fan, baseball, 338. 
 Farm by-products, 278. 
 electric operated, 271. 
 losses to, products, 41. 
 products, 279. 
 yield of, 40. 
 Farmers and banks, 222. 
 European, 246. 
 and engineers, 272. 
 benefit, 273. 
 cold storage, 277. 
 wages, 40. 
 ignorant, 64. 
 Farming, electric, 175. 
 Fathers, 378. 
 
 Federal administration, xvi. 
 commission government, 159. 
 council, 323. 
 and state law, 19. 
 Feudalism, 345. 
 Fertilizer, 257. 
 Fighting forest fires, 35. 
 Financiers, Wall Street, 75. 
 Fitch, John H., 309. 
 Fire alarms, 58. 
 Firearms, 343. 
 Fire chief's boast, 62. 
 Fire, Equitable, 59. 
 forest, 33, 34. 
 insurance costs, 58. 
 losses, xviii. 
 Fire senses, 372. 
 Flagg, Ernest, 121. 
 
 Flag, the German, 249. 
 Fletcher, Dr. Robert, 162. 
 Floods, waste due, xvii. 
 Food, injurious, 365. 
 Football games, 333. 
 Foreign language, 409. 
 
 trade, 422. 
 Forests, 33. 
 
 Forest fires, xvii, 34. 
 public ownership of, 36. 
 taxes on, 34. 
 
 Fortbildungs Schule, 392. 
 
 Fourth of July, 305, 340. 
 
 Framers of Constitution, 153. 
 
 Frank, Adolph, 259. 
 
 Frankenstein, 228. 
 
 Frauds, pension, 25. 
 
 Frederick the Great, 7. 
 
 Frederick Wilhelm I, 394. 
 
 Freedom from political influence, 
 105. 
 
 Friendship in politics, 13. 
 
 Frisbie, J. J., 332. 
 
 Froebel, Frederick, 395. 
 
 Fruits, injury to, 63. 
 
 Fuller, Hubert Bruce, 266, 268. 
 
 Function of nation, 85. 
 
 Funeral standard, 184. 
 
 Future, civilization of, 124. 
 
 G 
 
 Gaffney, T. St. John, 292. 
 Galileo, 394. 
 Galveston flood, 143. 
 Gambling, 227. 
 Games, 333. 
 Garbage, 363'. 
 
 destructors, 364. 
 Garfield, 270. 
 Gas supply, 37. 
 
 waste of, xvii. 
 German administrators, 251. 
 
 aesthetic lobe, 238. 
 
 army conditions, 303. 
 
 banking, 235. 
 
 Burgherr, 126. 
 
 brain, 23S. 
 
 canal systems, 266. 
 
 characteristics, 124. 
 
 chemists, 259. 
 
 cities, 124. 
 
 colonies in England, 251. 
 
 conditions, xxi. 
 
 courts regarding trust, 110. 
 
 drift towards socialism, 98. 
 
 domestic costumes, 321.
 
 432 
 
 INDEX 
 
 German education, 295, 385, 387. 
 
 Emperor, 294. 
 
 Empire, 162, 395. 
 
 farmers, 276. 
 
 flag, 249. 
 
 government, 373. 
 
 government business, 101. 
 
 government owned properties, 103. 
 
 immigration, 294. 
 
 immigrants, 114. 
 
 insurance systems, S'15. 
 
 invasion, 251. 
 
 iron and steel industry, 264. 
 
 mayor, 106. 
 
 navy, 254. 
 
 news, 253. 
 
 people, 267. 
 
 police, 373. 
 
 professors, 408. 
 
 progress, 294, 412. 
 
 population, xii. 
 
 railways, 100. 
 
 street lighting, 176. 
 
 success, 391. 
 
 syndicates, 112. 
 
 trusts, 108. 
 
 universities, 164. 
 
 voters, 114. 
 
 wealth, 78. 
 Germanizing the World, 243, 252. 
 Germany vs. America, xxi. 
 
 elective offices in, 107. 
 
 schools, 303. 
 
 statesmen of, 250. 
 
 supporting 65 million people, 6. 
 General Electric Co., 170. 
 Gewerbe Gerichte, 197. 
 Girls, downfall of young, 308. 
 Goods, pushing, 248. 
 Gordon, Cliff, 158. 
 Governmental inefficiency, 9, 420. 
 
 ownership, 88, 422. 
 
 participation, 314. 
 
 properties, 103. 
 
 regulation, 84. 
 
 socialism, 83, 88. 
 
 socialism in Germany, 96. 
 
 support, 180. 
 
 tax on money, 231. 
 
 advisers, 107. 
 
 attitude, 262. 
 
 city, 16. 
 
 commission, 142. 
 
 extravagance, 22. 
 
 insurance, 325. 
 
 losses, 234. 
 money, 233. 
 
 Governmental office, 414. 
 
 organization, 17. 
 
 is responsible, xiv. 
 
 support, 392. 
 Graft, 9. 
 
 in administration, xiv. 
 Graduates, 390. 
 Great Britain exception, 266. 
 Great lessons to be learned, xxiii. 
 Grinding an ax, 250. 
 Growth of cities, 116, 138. 
 Guests, at colleges, 407. 
 Guttenberg, 393. 
 Gymnasium, German, 395, 397. 
 
 Handicaps, industrial, 160. 
 
 Hamburg American Line, 108. 
 
 Hadley, President, 403. 
 
 Hard times, 225. 
 
 Haussmann, Baron, 134, 139. 
 
 Hebrew Religion, 389. 
 
 Herbergen, 297. 
 
 Herggelet, Mariano, 254. 
 
 Herrick, Governor, xvi. 
 
 Herring, W. G., 177. 
 
 Hittites, ball games, 336. 
 
 Hogarth, Prof., 336. 
 
 Holland, 267. 
 
 Hollweg, Dr. von Behrmann, 21. 
 
 Home rule, 117. 
 
 Homicide, 342. 
 
 Horses and mules on the farm, 272. 
 
 Horse power, water, 261. 
 
 Horwill, Rev. Herbert W., 5. 
 
 Hotchkiss, William H., xvi. 
 
 Hours of work, S08, 309. 
 
 Household servants, 321. 
 
 furniture, 360. 
 Houses, overheated, 371. 
 Howe, Frederick C, 124, 295, 298, 
 
 317, 321. 
 Howard, Justice, 20. 
 Human development, xii. 
 
 life, 342. 
 
 life, conservation of, 44. 
 Hunters, Pension, 26. 
 Husband, European, 374. 
 Hydroelectric developments, 41. 
 
 plants, 260. 
 
 Ice Cream, 365, 368. 
 Ignorance, cost of, 412. 
 
 of farmers, 64. 
 Illiterates, 386.
 
 INDEX 
 
 433 
 
 Imitative spirit, 173. 
 Immigration, 283. 
 in 1910, 287. 
 policy, xir, 
 total of, 114. 
 value of, 289, 
 to U. S., 114. 
 Immigrants, Americanized, 370, 
 disappointed, 291, 
 of various Nations, 114, 
 Implements of production, 416. 
 Important inventions, 161. 
 Incivilities, 387, 
 Incompetency, administration, xiv, 
 
 the whine of, 421, 
 Independence day, 341. 
 Individuality in cities, 119. 
 Individual action, 404. 
 Industrial accidents, 48. 
 battle, 203. 
 diseases, xiv, xviii. 
 depression, 297. 
 
 developments, the reasons for, 164. 
 enterprise, 160. 
 handicaps, 160, 182. 
 insurance, xiv. 
 
 originality, 160. ^ 
 
 regulations, 197. 
 research offices, 165. 
 restriction, xiv, 
 supremacy, 182. 
 unrest, xiv. 
 Industry, control of, 74, 
 modern, 202, 
 small, 202, 
 
 the State in private, 8, 
 IneflBcience, administration, xiv, 33, 
 canker of, 419, 
 governmental, 9, 420. 
 Inquisition into private affairs, 151. 
 Instructions, hours of, 392. 
 Instructions, methods of, 392, 
 Insurance department, Germany, 
 296, 
 efficiency of workingmen, 329. 
 social, 314. 
 system, 315, 320, 323. 
 International intercourse, xii. 
 Interstate Commerce Commission, 
 
 87, 149, 
 Invalidity and old age insurance, 
 
 316, 324, 
 Invention, 416. 
 origin, xii, 
 European, 167. 
 progress due to, 83, 
 Inventors, American, 167. 
 
 Ironmaster, 311. 
 
 Iron and steel manufacturers, 164. 
 
 industry, 264. 
 
 ore, production, 37. 
 Irrigation by electricity, 277. 
 Isolation, political, 5. 
 Italian endowed societies, 299. 
 
 Jack-of-all-trades, 409. 
 Japan, commission form of govern- 
 ment, 144. 
 progress, xiv. 
 Johnson, Tom, 117. 
 Jones, John Paul, 301. 
 Jones, Sam L., 117. 
 Journal of Commerce, 400. 
 Judges of United States, 18. 
 Junge, Dr. Franz Erich Hermsdorff, 
 6, 76. 
 
 Kaiser, the, 108. 
 Kepler, 394. 
 Kindergarten, 395. 
 King Edward, 251. 
 
 of finance, 82, 
 
 George III, 305. 
 
 the money, 82, 
 Kitty Hawk, 178, 
 Knarck, Dr,, 400, 
 Koester, Frank, 174, 260, 272, 274, 
 
 301, 393, 404. 
 Kratz, Obergrat, 322, 
 Krueger, pardon of Oscar, 237. 
 
 Labaratory, technical, 166. 
 Laborer, wages and hours, 308. 
 
 and capital, 79, 182. 
 
 registrations, 295. 
 
 troubles, 416, 
 
 unions, 189. 
 
 U, S, Commissioner, 314. 
 
 women, 51. 
 Lackeys of Wall Street, 228. 
 Landrecht, 7. 
 Lawless country, 151. 
 Lawlessness, 236. 
 Laws, defective, 216. 
 
 in Germany, 217. 
 
 inadequacy of, xiv. 
 
 passed in 1910, xvi. 
 
 respect for, 21. 
 
 of the U. S,, 20. 
 
 passed by Tyros, 11.
 
 434 
 
 INDEX 
 
 Lawyers gains, 317. 
 Leading men, 154. 
 Lead poisoning, 48. 
 Lebensweisheit, 239. 
 Legal delays, 21. 
 
 pest. National, 21. 
 Legislation, 420. 
 Legislators, incompetent, 11. 
 
 salaries of, 10. 
 
 control of, 15. 
 Legitimate transactions, 228. 
 L'Enfant, 139. 
 Length of life, 50. 
 Leonard, H. Ward, 166, 170. 
 Lentze, Dr., 106. 
 Liberty, canker destroys, 10. 
 Licensed engineers, 185. 
 Life, length of, 50. 
 
 loss of, xviii. 
 
 loss of, due to fire, 56. 
 
 sacrifice of, xvii, xiv. 
 
 position, 104. 
 
 value of, 50. 
 Lilienthal, Otto, 178, 333. 
 Listeners at University Lectures. 
 
 406. 
 Livelihood, learning of, xiv. 
 Loan brokers, 234. 
 Log rolling, 158. 
 Lougheed, 178. 
 Loss to agriculture, 64. 
 
 per capita, xxi. 
 
 to farm products, 41. 
 
 of life by fire, 56. 
 Law's delays, 21. 
 Lynching, 344. 
 
 M 
 
 Made in Germany, 250. 
 Magdeburg, 106. 
 Magee, Louis J., 388. 
 Manchu ordinance, 250, 
 Mania for standardization, 185. 
 Manufacturers, communal groups of. 
 209. ^ ' 
 
 favored, 422. 
 
 of Germany, 235. 
 
 syndicates,' 99. 
 Marienfeld-Zossen, 410. 
 Marriage, 380. 
 
 Maternity insurance, 316, 327. 
 Maxwell, Supt. of schools, 370. 
 Mayor, position of, 106. 
 Mazda lamps, 174. 
 McClellan, Mayor, 4, 73, 76, 80. 
 McNamara, 199. 
 
 Measures for prevention of disease, 
 
 53. 
 Mecca-America, 408. 
 Members of consumers unions, 353. 
 Men of science, 164. 
 Merchant marine, xiv. 
 Merrie England, 91. 
 Middlemen, 233. 
 Miller, Frank H., 332. 
 Military service, 406. 
 Mineral production, 37. 
 Mining accidents, 47. 
 Mismanagement of railroads, xv. 
 
 of post office, 30. 
 Mississippi, water ways, 263, 267, 
 
 269. 
 Missouri, I am from, 219. 
 Mittel Schule, 396. 
 Modern cities, 117. 
 
 chemistry and engineering, 257. 
 
 conditions, 417. 
 
 industry, 202. 
 Moltke, General, 239. 
 Monarchy, constitutional, 153. 
 Monarchical socialism, 101. 
 Money brought in by immigrants, 
 288. 
 
 King, 82. 
 
 taken out by immigrants, 288. 
 Monopoly, private, 8, 71. 
 
 and progress, 6. 
 Monopolistic fangs, 418. 
 Monopolies, failure to cope with, 
 
 xiv. 
 Moody, John, 73. 
 Moody and Turner, 80. 
 Moral courage, 376. 
 Moral training, 414. 
 More, Sir Thomas, 91. 
 Morgan & Co., J. Pierpont, 88. 
 Morgan group, 73. 
 Murderers, 342. 
 Municipal labor registries, 295. 
 
 savings bank, 100. 
 
 socialism, 115. 
 
 technical advisers, 107. 
 
 thrift, 130. 
 Mutilation, 345. 
 
 N 
 
 Names, changing, 291. 
 Napoleon of Finance, 82. 
 Napoleon III, 134. 
 National Commission government, 
 159. 
 conservation committee, 36.^
 
 INDEX 
 
 435 
 
 National gas, waste of, xvii. 
 
 legal pest, 21. 
 
 pride, 160. 
 
 resources, xiii. 
 
 traits of Germany, 388. 
 
 wealth, 75. 
 Naturalized citizens, votes of, 114. 
 Naturalization of Englishmen, 284. 
 Nation's function, 85. 
 Nation, sorely tried, 414. 
 Naval demonstration, 251. 
 
 guns, 254. 
 Navy, German, 254. 
 Near East peril, 387. 
 Negroes, lynching, 344. 
 
 problem, 292. 
 Nervous crystallization, 358. 
 Newton, 394. 
 Newsboys, 361. 
 Newspaper telegrams, 253. 
 
 time of editions of, 362. 
 New York American, 372. 
 
 Evening Journal, 339. 
 
 Evening Sun, 342. 
 
 Globe, 67, 239, 334. 
 
 Sun, 340. 
 
 Times, 235, 241, 243, 291, 312. 
 
 World, 128, 238. 
 Niagara Falls, 260. 
 Nobel prizes, 412, 413. 
 Noises, 360. 
 
 North American Review, 48. 
 North Sea, 267. 
 Notarbeit, 298. 
 
 Offenders against laws, 20. 
 
 Offices, candidates for, 12. 
 
 Office holders, 158. 
 
 Official dishonesty, 10. 
 
 Official's foul excuse, 421. 
 
 Oil trust, 420. 
 
 Oldfield, Barney, 332. 
 
 Old Fogyism, 422. 
 
 Operating expenses, savings in, 201. 
 
 Organized social activities, 98. 
 
 efforts. 417. 
 Organization of banks, 232. 
 
 governmental, 17. 
 
 political, 13. 
 Orphan's insurance, 316, 324. 
 Outlook, The, 295, 321, 331. 
 Output, restricted, 191. 
 Overeating, 241. 
 Overdressed women, 308. 
 Ownership, private, 119. 
 
 Panics, 226. 
 
 Pardon of Oscar Kruegei, 237. 
 
 Parliament, 266. 
 
 Patents, bottled up, 173. 
 
 complaints, 170. 
 
 congress, 160. 
 
 examiners, 170. 
 
 lawyers, 171. 
 
 office, 169. 
 
 office profits, 172. 
 
 system, 167. 
 
 system, destructive, xiv. 
 Patriotic fervor, 185. 
 Patriots, 338. 
 Patriotism, 25. 
 
 superfluous, 340. 
 Police system, 372. 
 Peat, 40. 
 
 fuel, waste of, XVII. 
 Pension frauds, XIV, 25. 
 
 hunters, 26. 
 
 system, waste, XVIII. 
 People, persistent, 245. 
 
 supporting 65 million (Germany), 
 6. 
 People's will, 373. 
 Pepper, Mr., 25. 
 Peril, Near East, 387. 
 
 venereal, 377. 
 
 yellow, 387. 
 Perkins, Greorge W., 88. 
 Personnel of the administration, 5. 
 Pestalozzi, 395. 
 Petroleum production, 37. 
 Philanthropy, 311. 
 Pinffree. Hazen S., 118. 
 Pierce, B. F., 175. 
 Pierce, Paul P., 48. 
 Players, professional, 338. 
 Pleasure, refinements of, 415. 
 Plowing, electric, 278. 
 Pockets, bottomless, 414. 
 Poisoning, lead, 48. 
 Policemen, 131. 
 Politics, 419. 
 
 in business, 215, 
 
 in post office, 29. 
 
 grade of men, 158. 
 
 influence, freedom from, 105. 
 
 isolation, 5. 
 
 organization, 13. 
 
 party, new, 155. 
 
 system, 9. 
 Poor families, 363. 
 Poorly paid public servants, 10.
 
 436 
 
 INDEX 
 
 Poor's and Moody's Manuals, 73, 76. 
 Popular government, 142. 
 Population of U. S., 114. 
 
 per square mile, 286. 
 Pork barrel, 16, 157, 268. 
 Post office department, xiv, 27, 375. 
 
 waste, xviii. 
 Position, life, 104. 
 Potatoes, 280. 
 Potash, controversy, 79. 
 mines, 113. 
 syndicate, 112. 
 Potato, waste of, xix. 
 Potter's field, 380. 
 Poverty in Germany, 322. 
 Power of American president, 108. 
 cost of, 42. 
 of courts, 155. 
 waste, 38. 
 Practical experience, 401. 
 
 politics, 419. 
 Presidency, candidates for, 156. 
 Presidential board, 159. 
 President, 21, 420. 
 Presidents as lackeys of Wall Street, 
 
 228. 
 President, power of, 108. 
 President Taft, 172, 237. 
 type of, 154. 
 of U. S., 12. 
 Prevention of forest fires, 35. 
 Price regulation, 85. 
 Primary ballot, 13. 
 Principles of commission system, 
 
 146. 
 Pritchett, Henry S., 184. 
 Private capital, 422. 
 monopoly, 8, 71. 
 ownership, 119. 
 properties, 120. 
 teachers, 382. 
 Problem, greatest, 258. 
 Production of mineral, 37. 
 Professional education, 401. 
 
 players, 338. 
 Professors, exchange of, 413. 
 
 German, 408. 
 Profits of banks, 232. 
 
 of governmental properties, 103. 
 Progress, cornerstone of, 104. 
 due to inventions, 83. 
 in engineering, 261. 
 stimulating, 248. 
 Pro-gymnasium, 406. 
 Promotors in America, 236. 
 Promotion of engineering education, 
 404. 
 
 Properties, governmental, 103. 
 
 profits of governmental properties, 
 103. 
 
 private, 120. 
 
 checked, xv. 
 
 ruining of, xvi. 
 Protestant Religion, 389. 
 Prussian common law, 97. 
 
 revenue, 102. 
 
 schools, 394. 
 Public failure, 378. 
 
 and inventors, 168. 
 
 opinion, 249. 
 
 reason, 423. 
 
 the servant of the, 3. 
 
 the servants of the, 9. 
 
 servants of, xv. 
 
 Service Commission, 89. 
 
 service, 175. 
 
 utilities, 119. 
 
 welfare, 358, 420. 
 Purchasers, 352. 
 Purchasing agents, 354. 
 
 Q 
 
 Quebec bridge, 262. 
 
 R 
 
 Racing automobiles, 331. 
 Railroads, 69. 
 
 accidents, 46. 
 
 German, 100. 
 
 stations, 133. 
 
 waste, xviii. 
 Ratke, 394. 
 
 Real Gymnasium, 395. 
 Real Pro-gymnasium, 407. 
 Real Schule, 406. 
 Rebate, consumers unions, 351. 
 Recruits, 300. 
 Rectifiers, 367. 
 Reducing selling cost, 213. 
 Refuse, utilization of, 130. 
 Regierungs Baufiihrer, 411. 
 Regierungs Baumeister, 406. 
 Regulation of prices, 85. 
 
 governmental, 84. 
 Reichsbank, 99. 
 Reichstag, 107. 
 Relations, domestic, 379. 
 Relief societies, 299. 
 Religion, Christian, 389, 390. 
 Remedy, Bismark's, 4. 
 Remedies, the, 414. 
 Rensselaer Polytechnic Institute, 
 162.
 
 INDEX 
 
 437 
 
 Representation, congressional, 155. 
 
 false, 218. 
 Resources undeveloped, 257. 
 Research work, 411. 
 Respect for authority, 105. 
 
 for law, 21. 
 
 for woman, 378. 
 
 of the public, xv. 
 Restoring competition, 72. 
 Restriction of industry, xiv. 
 Restitution, Carnegie, 311. 
 Return of immigrants, 290. 
 Revenue, Prussia, 102. 
 Review of Reviews, 164, 266. 
 Rhine, 263, 267. 
 Rhineland, 406. 
 Ridder, Herman, xiii. 
 Right to work, xiv, 293. 
 River traffic, 263. 
 Roberts, Elmer, 101. 
 Rockefeller, John D., 311. 
 Rockefeller, Jr., John D., 27. 
 Roman civilization, 139. 
 Roman Catholic Church, 311. 
 Roosevelt, Col., 273. 
 Rose, Jack, 372. 
 Rosenthal, Herman, 373. 
 Rowdies, 381. 
 Rowe, Prof. L. S., 86. 
 Raw material, purchase of, 206. 
 Ruining of prosperity, xiv. 
 Rural industry, 276. 
 
 waste, 64. 
 Russell, Charles Edward, 243, 248, 
 
 252. 
 Russian congress, 158. 
 
 illiterates of, 387. 
 
 S 
 
 Sacred concerts, 118. 
 Salaries of legislators, 10. 
 Saloons, 367. 
 Saltpeter, 257. 
 Salvation Army, 301. 
 Sanitation, 363. 
 
 of factories, 60. 
 Savings bank depositors, 256. 
 
 bank, municipal, 100. 
 Second-hand progress, 422. 
 Schools of Town Planning, 135. 
 
 trade, 188. 
 Schemes, fake, 218. 
 Schmidt, Hans, 332. 
 Schwarz, Dr. Paul, 80. 
 Scientific American, 177. 
 
 Scientific currency, 231. 
 
 management, 189. 
 
 men, 164. 
 Scientifically trained directors, 163, 
 Scribner's Magazine, 101. 
 Scully, Thomas, 312. 
 Securities, 77. 
 
 Self-satisfied Americans, xiii. 
 Senses, five, 372. 
 Sense of taste, 364. 
 Sense of smell, 362. 
 Servants, household, 321. 
 
 of the public, xv, 3, 9. 
 Shank, Mayor Samuel, 359. 
 Shame of our Army, 301. 
 Sherman law, xvii, 113. 
 Sherwin, Louis, 67. 
 Show-me spirit, 179, 418. 
 Shoemaker, Joel, 221. 
 Sickness, cost of, 49. 
 Sickness insurance, 316, 318, 323, 
 
 325. 
 Sidewalks, 375. 
 Skinner, Robert P., 108. 
 Skyscrapers, 120. 
 Small industries, xv, 202. 
 Small manufacturer, restoration of, 
 
 214. 
 Smell, sense of, 364. 
 Smith, Adams, 8. 
 Smithsonian Institute, 412. 
 Social improvements, 385. 
 
 insurance, 314. 
 
 laws, 132. 
 Socialism, 320. 
 
 governmental, 83. 
 
 Monarchical, 101. 
 
 municipal, 115. 
 
 State, 7. 
 
 what it is, 91. 
 Socialists, 297. 
 Societies for various preventions, 
 
 237. 
 Soldiers, country of, 402. 
 Soldiers, diseases, 377. 
 
 forest fires, 34. 
 
 of the U. S., 300. 
 Soil and climate, 366. 
 Soil erosion, xviii, 41. 
 
 fertilization, 258. 
 South America, 249. 
 Speculation, 77. 
 Speculators, 224. 
 Spectacular arrests, 237. 
 Sport, 330. 
 Staatsnotrecht, 98.
 
 438 
 
 INDEX 
 
 Standardization, 183, 186. 
 
 effect of, 186. 
 Standard Oil Co., 80. 
 
 in Germany, 80. 
 
 group, 73. 
 Standing of engineer, 410. 
 State board of five governors, 150. 
 State's duty, 415. 
 State and federal law, 19. 
 Statesmanship, American, xiii. 
 Statesmen of England, 250. 
 
 of Germany, 250. 
 State socialism, 7. 
 
 the, in private industry, 8. 
 Steam engines, 185. 
 Steamship lines, 249. 
 Stefan, George, 239. 
 Stein-Hardenberg, 293. 
 Stein-Hardenburg legislation, 97. 
 Sterilization, 345. 
 Stillwell, L. B., 162. 
 Stimulating progress, 248. 
 St. Louis, 263. 
 
 exposition, xxiii. 
 Stock Exchange, 223, 226. 
 Stomach, disorder of, 365. 
 Stores of consumers' unions, 350. 
 Street appearance, 128. 
 
 cars, 362, 371. 
 
 lighting, 175. 
 
 railways, 45, 360. 
 
 waste, 130. 
 Student, British, 264. 
 
 German, 408. 
 Stupidity, British, 245. 
 Styles, 183. 
 
 Success of Germany, 105, 391. 
 Supervision of business, 88. 
 Survey, 56. 
 Swamp land, 40. 
 Swindlers, 368. 
 Swindling, 227. 
 Systematic training, 195. 
 System of education, 385. 
 
 political, 9. 
 Syracuse, automobile racing at, 331. 
 Syndicates, 111. 
 
 of manufacturers, 99. 
 
 Taft, William Howard, 76. 
 Taste, sense of, 364. 
 Technical advisers to Ambassadors, 
 30. 
 
 books published, 411. 
 
 laboratory, 166. 
 
 Technical schools, 404. 
 Terrible Germans, the, 251. 
 Testing plant, xiv, 165. 
 Thackara, A. W., 217. 
 Theatrical inefficiency, 65. 
 
 trust, 66. 
 Timber, waste of, 34, 36. 
 Tom, Dick and Harry, 330. 
 Torney, Surgeon-general, 377. 
 TowTi councils, 126. 
 
 planning, method of, 128. 
 
 planning, schools of, 135. 
 Trade, English, 403. 
 
 school, 188. 
 Traffic, river, 263. 
 Transportation losses, 44. 
 
 on water, 263. 
 Treasury department of U. S., 233. 
 Trespassing on railroads, 46. 
 Thrift, municipal, 130. 
 Trusts, 416. 
 
 competition with, 210. 
 
 German, 108. 
 
 organizers of, 223. 
 
 supplanting the, 202. 
 
 theatrical, 66. 
 Trusted policemen, 131. 
 Tungsten lamp, 174, 275. 
 Turmoil in America, xiv. 
 Turner, George Kilbe, and John 
 
 Moody, 80. 
 Tyros, laws passed by, 11. 
 
 U 
 
 Uncle Sam's soldiers, 300. 
 Uncle Tom's Cabin, 360. 
 Undertakings, increase of German, 
 
 105. 
 Undeveloped resources, 257. 
 Unemployment insurance, 316. 
 Universities, 394. 
 
 of Germany, 398, 400. 
 Union workmen, earnings of, 312. 
 Unions, inefficiency of, 312. 
 Unrest in America, xiv. 
 United States of Europe, 17. 
 
 Patent office, 176. 
 
 President of, 12. 
 
 Steel Co., 309. 
 
 Value of German methods, 412. 
 
 of immigration, 289. 
 
 of life, 50. 
 Voluntary insurance, 325.
 
 INDEX 
 
 439 
 
 Vasco de Gama, 394. 
 
 Vaudeville, 66. 
 
 Venereal peril, 377. 
 
 Vice-president, 152. 
 
 Voice of America, 162. 
 
 Volks Hoch Schule, 3'97. 
 
 Volks Schule, 395, 396. 
 
 Voters' representation, 156. 
 
 Votes of naturalized citizens, 114. 
 
 W 
 
 Wabash River, 268. 
 
 Wage earners, death rate of, 49. 
 
 earnings of, 193. 
 
 in Germanv, 320. 
 
 in U. S., 320. 
 Wages, average, xxi. 
 Wages of laborers, 308. 
 Wagner, Prof. Adolph, 86. 
 Wagner, Richard, 239. 
 Wagner-Smith Commission, 307. 
 Wall Street, 228. 
 
 financiers, 75. 
 Walker, Gen. Francis A., 284. 
 War department, 301. 
 Work of civilization, xxiii. 
 
 right to, xiv. 
 Wash sales, 227. 
 Waste of administration, 22. 
 
 of natural resources, xiv. 
 
 of timber, S'6. 
 
 of water power, 262. 
 Water consumption, 56, 62. 
 Water power, 39, 42. 
 
 of principal countries, 261. 
 
 waste of, xvii. 
 Wealth, national, 75. 
 
 of the people, 255. 
 
 Wealth, statistics of, 78. 
 Webster, Pelatiah, framer of consti- 
 tution, 152. 
 West Point, 304. 
 Whiskey, 367, 240. 
 Whine of incompetency, 421. 
 Whitlock, Brand, 117.' 
 Widows' and orphans' insurance, 
 
 316, 319, 328. 
 Winkle, Prof., 336. 
 Woman, American, 374. 
 Women's boast, 347, 348. 
 
 dress, 371. 
 
 education in Germany, 398, 399. 
 
 respect for, 376. 
 
 at work, 51, 103, 306. 
 Wards of the public, 132. 
 Work, houses of, 308, 309. 
 Workman, the, 182. 
 Workingmen's eating time, 242. 
 
 houses, 244. 
 
 homes, 127. 
 
 training, 198. 
 
 value of the, 311. 
 Working people, care of, 317. 
 Work, the right to, 293. 
 
 for the workingman, 293. 
 World's work, 23, 88, 179, 268. 
 Wright brothers, 177, 179. 
 
 Yearly fire loss, 55. 
 Yellow peril, 387. 
 Yield of the farm, 40. 
 
 Zeppelin, Count, 179, 180.
 
 BY THE SAME AUTHOR 
 
 Electricity for the Farm 
 and Home 
 
 BY 
 
 FRANK KOESTER 
 
 CONSULTING ENGINEER 
 
 16 MO. PROFUSELY 
 
 $1.00 NET. ILLUSTRATED 
 
 The utilization of electricity in the operation of the 
 numerous farm and domestic appliances, is comprehensively 
 treated in this roliune. Electricity is the only medium that 
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 book is a pioneer work, being the first that has been pub- 
 lished on the subject, 
 
 TABLE OF CONTEXTS. 
 Chapter 
 
 i ixtroductiox 
 II Cextral Statiox SER\nCE 
 
 III Gexerattxo Exictric Power 
 
 IV Electric Motor Appucatioxs 
 
 V Cost of Operating Electric Dritex Farm Machixert 
 
 VI Electricity ix the Maxltactl-re of Farm By- 
 products 
 
 VII Electricity ix the Pheservatiox of Farm Product* 
 
 VIII Electric Traxsportatiox of Farm Products 
 
 IX Electric Plowixg 
 
 X Eu:ctric Power ix Irbigatiox 
 
 XI Electric Stimulatiox of Vegetatiox 
 
 XII Dm:RSE Applicatioxs of Electricity 
 
 XIII Electric Heatixg 
 
 XIV Electric Lighting 
 
 XV The Telephone ix Rural Commuxfties 
 
 "Within recent years a great deal of attention has been 
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 use of electrical energj- in rural communities. Among those 
 who have given this subject special study and to whose 
 energy and perseverance much of the development which has 
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 New York" . . . Electrical Review and Western Electrician.
 
 BY THE SAME AUTHOR 
 
 American City Planning 
 
 BY 
 
 FRANK KOESTER 
 
 CONSULTING ENGINEER 
 
 City planning is not a subject for the architect and en- 
 gineer alone; it has a close personal interest for all who 
 take any pride in the cities in which they live. Public wel- 
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 the subject, covers the whole field comprehensively including 
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 fusely illustrated and is as interesting if not more so to the 
 general reader as it is to the specialist. 
 
 TABLE OF CONTENTS 
 
 Preface. Introduction. What City Planning Is. How to 
 Proceed in Replanning a City. Financing Civic Improvements. 
 Valuation of Public Utilities. The Civic Centers. The Great 
 Ground Plan. Arterial Highways. Streets Up-to-Date. Har- 
 bors and Water Fronts. Traffic and Transportation. Open 
 Squares and Traffic Regulation. Park Systems. Civic Em- 
 bellishment. Building Regulation and Block Plans. Garden 
 Cities and Workingmen's Colonies. Civic Culture. Adminis- 
 trative Functions. Communal Industries. Planning of Grow- 
 ing To\vns. City Construction and Maintenance. Street Con- 
 structions. Sewer and Sewage Disposal. Care of Streets. 
 Street Cleaning. Refuse Disposal. Water Supply. Gas 
 Works. Electric Generating Plants. Electric Street Railway. 
 
 SOME OPINIONS 
 
 The great part played by engineering in city planning is not 
 fully appreciated, except by those who have had direct experi- 
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 fundamental importance. The author has had considerable 
 exi>erience with municipal undertakings abroad, and gives spe- 
 cial emphasis to lessons which American cities may learn from 
 European practice. — The American City. 
 
 The series of articles on Town Planning by Mr. Frank 
 Koester, that now are appearing in The American Architect, 
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 tant to arcliitects. Mr. Koester's researches in connection with 
 the subject of Town Planning have been extended over a 
 period of years and his articles are the result of study by a 
 technically trained but eminently practical man. — The Ameri- 
 can Architect.
 
 BY THE SAME AUTHOR 
 
 Hydroelectric Developments 
 and Engineering 
 
 BY 
 
 FRANK KOESTER 
 
 8x11 INCHES 479 PAGES 
 
 500 ILLUSTRATIONS PRICE, $5.00 NET 
 
 Forty Per Cent, of This Information 
 Pertains to European Practice 
 
 SOME OPINIONS 
 
 "At this time, when attention is strongly being drawn 
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 not only given many examples of the most instructive types 
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 stitute of Technology, Hoboken, N. J. 
 
 "This work dealing with a subject of great interest to en- 
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 — The School of Mines Quarterly, Columbia University, New 
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 "Mr. Koester has made an exhaustive study of the evolution 
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 The reader will find in this handsome, well- written, well-in- 
 dexed volume the latest ideas, 'fads and fancies,' and real 
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 New York.
 
 BY THE SAME AUTHOR 
 
 Steam-Electric Power Plants 
 
 BY 
 
 FRANK KOESTER 
 
 8x11 INCHES 473 PAGES 
 
 500 ILLUSTRATIONS PRICE, $5.00 NET 
 
 Recommended by Technical Journals 
 
 to Experts and Advanced Engineers 
 
 Adopted as a Text by Leading Universities 
 
 SOME OPINIONS 
 
 "This book will undoubtedly take a high place among the 
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 "The author really does more than carry his immediate 
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 tive and useful. The treatment of the subject is systematic." 
 — Engineering, London. 
 
 "It would be difficult to mention any detail that is not 
 touched upon and its relation to other details in the entire 
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 New York. 
 
 "A long-felt want has been met with the issue of this work, 
 as it supplies the consulting engineer, as well as contractors 
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 tation in the engineering profession, and the manner in which 
 the whole subject has been treated by him, embracing the 
 entire field, from the coal pile to the bus-bars, is fully up to 
 his high sta.nda.rd."~Electrical Review, New York
 
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