Chapter III: Part 3

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I made the terrible assertions that more than eighty thousand babies are slain by poverty in America each year; that some "2,000,000 children of school age in the United States are the victims of poverty which denies them common necessities, particularly adequate nourishment"; that there were at least 1,750,000 children at work in this country. These statements, and the evidence given in support of them, attracted widespread attention, both in this country and in Europe. They were cited in the U.S. Senate and in Europe parliaments. They were preached about from thousands of pulpits and discussed from a thousand platforms by politicians, social reformers and others.

A committee was formed in New York City to promote the physical welfare of school children. Although one of the first to take the matter up, I was not asked to serve on that committee, on account of the fact, as I was afterwards told, of my being a Socialist. Well, that Committee, composed entirely of non-Socialists, and including some very bitter opponents of Socialism, made an investigation of the health of school children in New York City. They examined, medically, some 1,400 children of various ages, living in different parts of the city and belonging to various social classes. If the results they discovered are common to the whole of the United States, the conditions are in every way worse than I had declared them to be.

_If the conditions found by the medical investigators for this committee are representative of the whole of the United States, then we have not less than twelve million school children in the United States suffering from physical defects more or less serious, and not less than 1,248,000 suffering from malnutrition--from insufficient nourishment, generally due to poverty, though not always--to such an extent that they need medical attention._[4]

Do you think a nation with such conditions existing at its very heart ought to be called a civilized nation? I don't. I say that it is a _brutalized_ nation, Jonathan!

And now I want you to look over a list of another kind of shameful social conditions--a list of some of the vast fortunes possessed by men who are not victims of poverty, but of shameful wealth. I take the list from the dryasdust pages of _The Congressional Record_, December 12, 1907, from a speech by the Hon. Jeff Davis, United States Senator from Arkansas. I cannot find in the pages of _The Congressional Record_ that it made any impression upon the minds of the honorable senators, but I hope it will make some impression upon your mind, my friend. It is a good deal easier to get a human idea into the head of an honest workingman than into the head of an honorable senator!

Don't be frightened by a few figures. Read them. They are full of human interest. I have put before you some facts relating to the shameful poverty of the workers and their pitiable condition, and now I want to put before you some facts relating to the pitiable condition of the non-workers. I want you to feel some pity for the millionaires!

THE RICHEST FIFTY-ONE IN THE UNITED STATES.

"When the average present-day millionaire is bluntly asked to name the value of his earthly possessions, he finds it difficult to answer the question correctly. It may be that he is not willing to take the questioner into his confidence. It is doubtful whether he really knows.

"If this is true of the millionaire himself, it follows that when others attempt the task of estimating the amount of his wealth the results must be conflicting. Still, excellent authorities are not lacking on this subject, and the list of the richest fifty-one persons in the United States has been satisfactorily compiled.

"The following list is taken from Munsey's Scrap Book of June, 1906, and is a fair presentation of the property owned by fifty-one of the very richest men of the United States.

"It will thus be seen that fifty-one persons in the United States, with a population of nearly 90,000,000 people, own approximately one thirty-fifth of the entire wealth of the United States. The Statistical Abstract of the United States, 29th number, 1906, prepared under the direction of the Secretary of Commerce and Labor of the United States, gives the estimated true value of all property in the United States for that year at $107,104,211,917.

"Each of the favored fifty-one owns a wealth of somewhat more than $64,600,000, while each of the remaining 89,999,950 people get $1,100. No one of these fifty-one owns less than $20,000,000, and no one on the average owns less than $64,600,000. Men owning from $1,000,000 to $20,000,000 are no longer called rich men. There are approximately 4,000 millionaires in the United States, but the aggregate of their holdings is difficult to obtain. If all their holdings be deducted from the total true value of all the property in the United States, the average share of each of the other 89,995,000 people would be less than $500.

"John Jacob Astor is reputed to have been the first American millionaire, although this is a matter impossible to decide. It is also claimed that Nicholas Longworth, of Cincinnati, the great grandfather of Congressman Longworth, was the first man west of the Allegheny Mountains to amass a million. It is difficult to prove either one of these propositions, but they prove that the age of the millionaire in the United States is a comparatively recent thing. In 1870 to own a single million was to be a very rich man; in 1890 it required at least $10,000,000, while to-day a man with a single million or even ten millions is not in the swim. To be enumerated as one of the world's richest men you must own not less than $20,000,000."

I am perfectly serious when I suggest that the slaves of riches are just as much to be pitied as the slaves of poverty. No man need envy Mr. Rockefeller, for example, because he has something like six hundred millions of dollars, an annual income of about seventy-two millions. He does not own those millions, Jonathan, but they own him. He is a slave to his possessions. If he owns a score of automobiles he can only use one at a time; if he spends millions in building palatial residences for himself he cannot get greater comfort than the man of modest fortune. He cannot buy health nor a single touch of love for money.

Many of our great modern princes of industry and commerce are good men. It is a wild mistake to imagine that they are all terrible ogres and monsters of iniquity. But they are victims of an unjust system. Millions roll into their coffers while they sleep, and they are oppressed by the burden of responsibilities. If they give money away at a rate calculated to ease them of the burdens beneath which they stagger they can only do more harm than good. Mr. Carnegie gives public libraries with the lavishness with which travellers in Italy sometimes throw small copper coins to the beggars on the streets, but he is only pauperising cities wholesale and hindering the progress of real culture by taking away from civic life the spirit of self-reliance. If the people of a small town came together and said: "We ought to have a library in our town for our common advantage: let us unite and subscribe funds for a hundred books to begin with," that would be an expression of true culture.

But when a city accepts a library at Mr. Carnegie's hands, there is an inevitable loss of self-respect and independence. Mr. Carnegie's motives may be good and pure, but the harm done to the community is none the less great.

Mr. Rockefeller may give money to endow colleges and universities from the very highest motives, but he cannot prevent the endowments from influencing the teaching given in them, even if he should try to do so. Thus the gifts of our millionaires are an insidious poison flowing into the fountains of learning.

Mind you, this is not the claim of a prejudiced Socialist agitator. President Hadley, of Yale University, is not a Socialist agitator, but he admits the truth of this claim. He says: "Modern University teaching costs more money per capita than it ever did before, because the public wishes a university to maintain places of scientific research, and scientific research is extremely expensive. _A university is more likely to obtain this money if it gives the property owners reason to believe that vested rights will not be interfered with._ If we recognize vested rights in order to secure the means of progress in physical science, is there not danger that we shall stifle the spirit of independence which is equally important as a means of progress in moral science?"

Professor Bascom is not a Socialist agitator, either, but he also recognizes the danger of corrupting our university teaching in this manner. After calling attention to the "wrongful and unflinching way" in which the wealth of the Standard Oil magnate has been amassed, he asks: "Is a college at liberty to accept money gained in a manner so hostile to the public welfare? Is it at liberty, when the Government is being put to its wits' end to check this aggression, to rank itself with those who fight it?"

And the effect of riches upon the rich themselves is as bad as anything in modern life. While it is true that there are among the rich many very good citizens, it is also perfectly plain to any honest observer of conditions that great riches are producing moral havoc and disaster among the princes of wealth in this country. Mr. Carnegie has said that a man who dies rich dies disgraced, but there is even greater reason to believe that to be born rich is to be born damned. The inheritance of vast fortunes is always demoralizing.

What must the mind and soul of a woman be like who takes her toy spaniel in state to the opera to hear Caruso sing, while, in the same city, there are babies dying for lack of food? What are we to think of the dog-dinners, the monkey-dinners and the other unspeakably foolish and unspeakably vile orgies constantly reported from Newport and other places where the drones of our social system disport themselves? What shall we say of the shocking state of affairs disclosed by the disgusting reports of our "Society Scandals," except that unearned riches corrode and destroy all human virtues?

The wise King, Solomon, knew what he was talking about when he cried out: "Give me neither poverty nor riches." Unnatural poverty is bad, blighting the soul of man; and unnatural riches are likewise bad, equally blighting the soul of man. Our social system is bad for both classes, Jonathan, and a change to better and juster conditions, while it will be resisted by the rich, the drones, with all their might, will be for the common good of all. For it is well to remember that in trying to get rid of the rule of the drones, the working class is not trying to become the ruling class, to rule others as they have been ruled. We are aiming to do away with classes altogether; to make a united and free social state.

FOOTNOTES:

[3] Mark 14:7.

[4] Quar. Pub. American Statistical Association, June 1907.

THE ROOT OF THE EVIL

All for ourselves and nothing for other people seems in all
ages to have been the vile maxim of the masters of
mankind.--_Adam Smith._

Hither, ye blind, from your futile banding!
Know the rights and the rights are won.
Wrong shall die with the understanding,
One truth clear, and the work is done.--_John Boyle O'Reilly._

The great ones of the world have taken this earth of ours to
themselves; they live in the midst of splendour and
superfluity. The smallest nook of the land is already a
possession; none may touch it or meddle with it.--_Goethe._

I have by no means exhausted the evils of the system under which we live in the brief catalogue I have made for you, my friend. If it were necessary, I could compile an immense volume of authentic evidence to overwhelm you with a sense of the awful failure of our civilization to produce a free, united, healthy, happy and virtuous people, which I conceive to be the goal toward which all good and wise men should aspire. But it is dreary and unpleasant work recounting evil conditions; constantly looking at the sores of society is a morbid and soul-destroying task.

I want you now to consider the cause of industrial misery and social inequality, to ask yourself why these conditions exist. For we can never hope to remove the evils, Jonathan, until we have discovered the underlying causes. How does it happen that some people are thrifty and virtuous and yet miserably poor and that others are thriftless and sinful and yet so rich that their riches weigh them down and make them as miserable as the very poorest? Why, in the name of all that is fair and good, have we got such a stupid, wasteful, unjust and unlovely social system after all the long centuries of human experience and toil? When you can answer these questions, my friend, you will know whither to look for deliverance.

You said in your letter to me the other day, Jonathan, that you thought things were bad because of the wickedness of man's nature. Lots of people believe that. The churches have taught that doctrine for ages, but I do not believe that it is true. It is a doctrine which earnest men who have been baffled in trying to find a satisfactory explanation for the evils have accepted in desperation. It is the doctrine of pessimism, despair and wild unfaith in man. If it were true that things were so bad as they are just because men were wicked and because there never were good men enough to make them better, we should not have any ground for hope for the future.

I propose to try and show you that the wickedness of our poor human nature is not responsible for the terrible social conditions, so that you will not have to depend for your hope of a better society upon the very slender thread of the chance of getting enough good men to make conditions better. Bad conditions make bad lives, Jonathan, and will continue to do so. Instead of depending upon getting good men first to make conditions good, we must make conditions good so that good lives may flourish and grow in them naturally.

You have read a little history, I daresay, and you know that there is no truth in the old cry that "As things are now things always have been and always will be." You know that things are always changing. If George Washington could come back to earth again he would be amazed at the changes which have taken place in the United States. Going further back, Christopher Columbus would not recognize the country he discovered. And if we could go back millions of years and bring to life one of our earliest ancestors, one of the primitive cave-dwellers, and set him down in one of our great cities, the mighty houses, streets railways, telephones, telegraphs, wireless telegraphy, electric vehicles on the streets and the ships out on the river would terrify him far more than an angry tiger would. Can you think how astonished and alarmed such a primitive cave-man would be to be taken into one of your great Pittsburg mills or down into a coal mine?

No. The world has grown, Jonathan. Man has enlarged his kingdom, his power in the universe. Step by step in the evolution of the race, man has wrested from Nature her secrets. He has gone down into the deep caverns and found mineral treasuries there; he has made the angry waves of the ocean bear great, heavy burdens from shore to shore for his benefit; he has harnessed the tides and the winds that blow and caught the lightning currents, making them all his servants. Between the _lowest_ man in the modern tenement and the cave-man there is a greater gulf than ever existed between the beast in the forest and the _highest_ man dwelling in a cave in that far-off period.

Things are not as they are to-day because a group of clever but desperately wicked men came together and invented a scheme of society in which the many must work for the few; in which some must have more than they can use, so that they rot of excess while others have too little and rot of hunger; in which little children must toil in factories so that big strong men may loaf in clubs and dens of vice; in which some women sell themselves body and soul for bread while other women spend the sustenance of thousands upon jewels for pet dogs. No. It was no such fiendish ingenuity which devised the capitalistic system and imposed it upon mankind. It has _grown_ up through the ages, Jonathan, and is still growing. We have grown from savagery and barbarism through various stages to our present commercial system, and the process of growth is still going on. I believe we are growing into Socialism.

There have been many forces urging mankind onward in this long evolution. Religion has played a part. Love of country has played a part. Climate and the nature of the soil have been factors. Man's ever growing curiosity, his desire to know more of the life around him, has had much to do with it. I have put the ideals of religion and patriotism first, Jonathan, because I wanted you to see that they were by no means overlooked or forgotten, but in truth they ought not to be placed first. It is the verdict of all who have made a study of social evolution that, while these factors have exerted an important influence, back of them have been the material economic conditions.

In philosophy this is the basis of a very profound theory upon which many learned volumes have been written. It is generally called "The Materialistic Conception of History," but sometimes it is called "Economic Determinism" or "The Economic Interpretation of History." The first man to set forth the theory in a very clear and connected manner was Karl Marx, upon whose teachings the Socialists of the world have placed a great deal of reliance. I don't expect you to read all the heavy and learned books written upon this subject, for many of them require that a man must be specially trained in philosophy in order to understand them. For the present I shall be quite satisfied if you will read a ten-cent pamphlet called _The Communist Manifesto_, by Karl Marx and Frederick Engels and, along with that, the fourth, fifth and sixth chapters of my book, _Socialism_, about a hundred pages altogether. These will give you a fairly clear notion of the matter. I shall not mention the hard, scientific name of this philosophy again. I don't like big words if little ones will serve.

If you enjoy reading a good story, a novel that is full of romance and adventure, I would advise you to read _Before Adam_, by Jack London, a Socialist writer. It is a novel, but it is also a work of science. He gives an account of the life of the first men and shows how their whole existence depended upon the crude weapons and tools, sticks picked up in the forests, which they used. They couldn't live differently than they did, because they had no other means of getting a living. How a people make their living determines how they live.

For many thousands of years, the scientists tell us, men lived in the world without owning any private property. That came into existence when men saw that one man could produce more out of the soil than he needed to eat himself. Then, when they went out to war with other tribes, the members of a tribe instead of trying to kill their enemies, made them captives and used them as slaves. They did not cease killing their foes from humane motives, because they had grown better men, but because it was more profitable.

From our point of view, slavery is a bad thing, but when it first came into existence it was a step upward and onward. If we take the history of slave societies and nations we shall soon find that their laws, their customs and their institutions were based upon the mode of producing wealth through the labor of slaves. There were two classes into which society was divided, a class of masters and a class of slaves.

When slavery broke down and gave way to feudalism there were new ways of producing wealth. The laws of feudal societies, their customs and institutions, changed to meet the needs brought about through the new methods of making things. Under slavery, the slaves made wealth for their masters and were doled out food enough to keep them alive. The slave had no rights. Under feudalism, the serfs produced wealth for the lords parts of the time, working for themselves the rest of the time. They had some rights. The bounds of freedom were widened. Under neither of these systems was there a regular system of paying wages in money, such as we have to-day. The slave gave up all his product and took what the master was pleased to give him in the way of food, clothing and shelter. The serf divided his time between producing for the owner of the soil and producing for his family. The slave produced what his owner wanted; the serf produced what either he himself or his lord wanted.

There came a time, about three hundred years ago, when the feudal system broke down before the beginnings of capitalism, the system which we are living under to-day, and which we Socialists think is breaking down as all other social systems have broken down before it. Under this system men have worked for wages and not because they wanted the things they were producing, nor because the men who employed them wanted the things, _but simply because the things could be sold and a profit made in the sale_.

You will remember, Jonathan, that in a former letter I dealt with the nature of wealth. We saw then that wealth in our modern society consists of an abundance of things which can be sold. At bottom, we do not make things because it is well that they should be made, because the makers need them, but simply because the capitalists see possibilities of selling the things at a profit.

I want you to consider just a moment how this works out: Here is a workingman in Springfield, Massachusetts, making deadly weapons with which other workingmen in other lands are to be killed. We go up to him as he works and inquire where the rifles are to be sent, and he very politely tells us that they are for some foreign government, say the Japanese, to be used in all probability against Russian soldiers. Suppose we ask him next what interest he has in helping the Japanese government to kill the Russian troops, how he comes to have an active hatred of the Russian soldiers. He will reply at once that he has no such feelings against the Russians; that he is not interested in having the Japanese slaughter them. Why, then, is he making the guns? He answers at once that he is only interested in getting his wages; that it is all the same to him whether he makes guns for Christians or Infidels, for Russians or Japs or Turks. His only interest is to get his wages. He would as soon be making coffins as guns, or shoes as coffins, so long as he got his wages.

Perhaps, then, the company for which he is employed has an interest in helping Japan defeat the troops of Russia. Possibly the shareholders in the company are Japanese or sympathizers with Japan. Otherwise, why should they be bothering themselves getting workpeople to make guns for Japanese soldiers to kill Russian soldiers with? So we go to the manager and ask him to explain the matter. He very politely tells us that, like the man at the bench, he has no interest in the matter at all, and that the shareholders are in the same position of being quite indifferent to the quarrel of the two nations. "Why, we are also making guns for Russia in our factory," he says, and when we ask him to explain why he tells us that "There is profit to be made and the firm cares for nothing else."

All our system revolves around that central sun of profit-making, Jonathan. Here is a factory in which a great many people are making shoddy clothing. You can tell at a glance that it is shoddy and quite unfit for wearing. But why are the people making shoddy goods--why don't they make decent clothing, since they can do it quite as well? Why, because there is a profit for somebody in making shoddy. Here a group of men are building a house. They are making it of the poorest materials, making dingy little rooms; the building is badly constructed and it can never be other than a barracks. Why this "jerry-building?" There is no reason under the sun why poor houses should be built except that somebody hopes to make profit out of them.

Goods are adulterated and debased, even the food of the nation is poisoned, for profit. Legislatures are corrupted and courts of justice are polluted by the presence of the bribe-giver and the bribe-taker for profit. Nations are embroiled in quarrels and armies slaughter armies over questions which are, always, ultimately questions of profit. Here are children toiling in sweatshops, factories and mines while men are idle and seeking work. Why? Do we need the labor of the little ones in order to produce enough to maintain the life of the nation? No. But there are some people who are going to make a profit out of the labors which sap the strength of those little ones. Here are thousands of people hungry, clamoring for food and perishing for lack of it. They are willing to work, there are resources for them to work upon; they could easily maintain themselves in comfort and gladness if they set to work. Then why don't they set to work? Oh, Jonathan, the torment of this monotonous answer is unbearable--because no one can make a profit out of their labor they must be idle and starve, or drag out a miserable existence aided by the crumbs of cold charity!

If our social economy were such that we produced things for use, because they were useful and beautiful, we should go on producing with a good will until everybody had a plentiful supply. If we found ourselves producing too rapidly, faster than we could consume the things, we could easily slacken our pace. We could spend more time beautifying our cities and our homes, more time cultivating our minds and hearts by social intercourse and in the companionship of the great spirits of all ages, through the masterpieces of literature, music, painting and sculpture. But instead, we produce for sale and profit. When the workers have produced more than the master class can use and they themselves buy back out of their meagre wages, there is a glut in the markets of the world, unless a new market can be opened up by making war upon some defenseless, undeveloped nation.

When there is a glut in the market, Jonathan, you know what happens. Shops and factories are shut down, the number of workers employed is reduced, the army of the unemployed grows and there is a rise in the tide of poverty and misery. Yet why should it be so? Why, simply because there is a superabundance of wealth, should people be made poorer? Why should little children go without shoes just because there are loads of shoes stacked away in stores and warehouses? Why should people go without clothing simply because the warehouses are bursting with clothes? The answer is that these things must be so because we produce for profit instead of for use. All these stores of wealth belong to the class of profit-takers, the capitalist class, and they must sell and make profit.

So you see, friend Jonathan, so long as this system lasts, _people must have too little because they have produced too much_. So long as this system lasts, there must be periods when we say that society _cannot afford to have men and women work to maintain themselves decently_! But under any sane system it will surely be considered the maddest kind of folly to keep men in idleness while saying that it does not pay to keep them working. Is there any more expensive way of keeping either an ass or a man than in idleness?

The root of evil, the taproot from which the evils of modern society develop, is the profit idea. Life is subordinated to the making of profit. If it were only possible to embody that idea in human shape, what a monster ogre it would be! And how we should arraign it at the bar of human reason! Should we not call up images of the million of babes who have been needlessly and wantonly slaughtered by the Monster Idea; the images of all the maimed and wounded and killed in the wars for markets; the millions of others who have been bruised and broken in the industrial arena to secure somebody's profit, because it was too expensive to guard life and limb; the numberless victims of adulterated food and drink, of cheap tenements and shoddy clothes? Should we not call up the wretched women of our streets; the bribers and the vendors of privilege? We should surely parade in pitiable procession the dwarfed and stunted bodies of the millions born to hardship and suffering, but we could not, alas! parade the dwarfed and stunted souls, the sordid spirits for which the Monster Idea is responsible.

I ask you, Jonathan Edwards, what you really think of this "buy cheap and sell dear" idea, which is the heart and soul of our capitalistic system. Are you satisfied that it should continue?

Yet, my friend, bad as it is in its full development, and terrible as are its fruits, this idea once stood for progress. The system was a step in the liberation of man. It was an advance upon feudalism which bound the laborer to the soil. Capitalism has not been all bad; it has another, brighter side. Capitalism had to have laborers who were free to move from one place to another, even to other lands, and that need broke down the last vestiges of the old physical slavery. That was a step gained. Capitalism had to have intelligent workers and many educated ones. That put into the hands of the common people the key to the sealed treasuries of knowledge. It had to have a legal system to meet its requirements and that has resulted in the development of representative government, of something approaching political democracy; even where kings nominally rule to-day, their power is but a shadow of what it once was. Every step taken by the capitalist class for the advancement of its own interests has become in its turn a stepping-stone upon which the working-class has raised itself.

Karl Marx once said that the capitalist system provides its own gravediggers. I have cited two or three things which will illustrate his meaning. Later on, I must try and explain to you how the great "trusts" about which you complain so loudly, and which seem to be the very perfection of the capitalist ideal, lead toward Socialism at a pace which nothing can very seriously hinder, though it may be quickened by wise action on the part of the workers.

For the present I shall be satisfied, friend Jonathan, if you get it thoroughly into your mind that the source of terrible social evils, of the poverty and squalor, of the helpless misery of the great mass of the people, of most of the crime and vice and much of the disease, is the "buy cheap and sell dear" idea. The fact that we produce things for sale for the profit of a few, instead of for use and the enjoyment of all.

Get that into your mind above everything else, my friend. And try to grasp the fact, also, that the system we are now trying to change was a natural outgrowth of other conditions. It was not a wicked invention, nor was it a foolish blunder. It was a necessary and a right step in human evolution. But now it has in turn become unsuitable to the needs of the people and it must give place to something else. When a man suffers from such a disease as appendicitis, he does not talk about the "wickedness" of the vermiform appendix. He realizes, if he is a sensible man, that long ago, that was an organ which served a useful purpose in the human system. Gradually, perhaps in the course of many centuries, it has ceased to be of any use. It has lost its original functions and become a menace to the body.

Capitalism, Jonathan, is the vermiform appendix of the social organism. It has served its purpose. The profit idea has served an important function in society, but it is now useless and a menace to the body social. Our troubles are due to a kind of social appendicitis. And the remedy is to remove the useless and offending member.

VII

FROM COMPETITION TO MONOPOLY

It may be fairly said, I think, that not merely competition,
but competition that was proving ruinous to many
establishments, was the cause of the combinations.--_Prof.
J.W. Jenks._

The day of the capitalist has come, and he has made full use
of it. To-morrow will be the day of the laborer, provided he
has the strength and the wisdom to use his opportunities.--_H.
De. B. Gibbins._

Monopoly expands, ever expands, till it ends by
bursting.--_P.J. Proudhon._

For this is the close of an era; we have political freedom;
next and right away is to come social
enfranchisement.--_Benjamin Kidd._

I think you realize, friend Jonathan, that the bottom principle of the present capitalist system is that there must be one class owning the land, mines, factories, railways, and other agencies of production, but not using them; and another class, using the land and other means of production, but not owning them.

Only those things are produced which there is a reasonable hope of selling at a profit. Upon no other conditions will the owners of the means of production consent to their being used. The worker who does not own the things necessary to produce wealth must work upon the terms imposed by the other fellow in most cases. The coal miner, not owning the coal mine, must agree to work for wages. So must the mechanic in the workshop and the mill-worker.

As a practical, sensible workingman, Jonathan, you know very well that if anybody says the interests of these two classes are the same it is a foolish and lying statement. You are a workingman, a wage-earner, and you know that it is to your interest to get as much wages as possible for the smallest amount of work. If you work by the day and get, let us say, two dollars for ten hours' work, it would be a great advantage to you if you could get your wages increased to three dollars and your hours of labor to eight per day, wouldn't it? And if you thought that you could get these benefits for the asking you would ask for them, wouldn't you? Of course you would, being a sensible, hard-headed American workingman.

Now, if giving these things would be quite as much to the advantage of the company as to you, the company would be just as glad to give them as you would be to receive them, wouldn't it? I am assuming, of course, that the company knows its own interests just as well as you and your fellow workmen know yours. But if you went to the officials of the company and asked them to give you a dollar more for the two hours' less work, they would not give it--unless, of course, you were strong enough to fight and compel them to accept your terms. But they would resist and you would have to fight, because your interests clashed.

That is why trade unions are formed on the one side and employers' associations upon the other. Society is divided by antagonistic interests; into exploiters and exploited.

Politicians and preachers may cry out that there are no classes in America, and they may even be foolish enough to believe it--for there are lots of _very_ foolish politicians and preachers in the world! You may even hear a short-sighted labor leader say the same thing, but you know very well, my friend, that they are wrong. You may not be able to confute them in debate, not having their skill in wordy warfare; but your experience, your common sense, convince you that they are wrong. And all the greatest political economists are on your side. I could fill a volume with quotations from the writings of the most learned political economists of all times in support of your position, but I shall only give one quotation. It is from Adam Smith's great work, _The Wealth of Nations_, and I quote it partly because no better statement of the principle has ever been made by any writer, and partly also because no one can accuse Adam Smith of being a "wicked Socialist trying to set class against class." He says:

"The workmen desire to get as much, the masters to give as
little as possible. The former are disposed to combine in
order to raise, the latter in order to lower the wages of
labor.... Masters are always and everywhere in a sort of
tacit, but constant and uniform, combination, not to raise the
wages of labor above their actual rate. To violate this
combination is everywhere a most unpopular action, and a sort
of a reproach to a master among his neighbors and equals....
Masters too sometimes enter into particular combinations to
sink the wages of labor.... These are always conducted with
the utmost silence and secrecy, till the moment of execution."

That is very plainly put, Jonathan. Adam Smith was a great thinker and an honest one. He was not afraid to tell the truth. I am going to quote a little further what he says about the combinations of workingmen to increase their wages:

"Such combinations, [i.e., to lower wages] however, are
frequently resisted by a contrary defensive combination of the
workmen; who sometimes too, without any provocation of this
kind, combine of their own accord to raise the price of labor.
Their usual pretenses are, sometimes the high price of
provisions; sometimes the great profit which their masters
make by their work. But whether these combinations be
offensive or defensive, they are always abundantly heard of.
In order to bring the point to a speedy decision, they have
always recourse to the loudest clamour, and sometimes to the
most shocking violence and outrage. They are desperate, and
act with the extravagance and folly of desperate men, who must
either starve, or frighten their masters into an immediate
compliance with their demands. The masters upon these
occasions are just as clamorous upon the other side, and never
cease to call aloud for the assistance of the civil
magistrate, and the rigorous execution of those laws which
have been enacted with so much severity against the
combinations of servants, laborers, and journeymen.

"But though in disputes with their workmen, masters must
generally have the advantage, there is however a certain rate,
below which it seems impossible to reduce, for any
considerable time, the ordinary wages even of the lowest
species of labor.

"A man must always live by his work, and his wages must at
least be sufficient to maintain him. They must even upon most
occasions be somewhat more; otherwise it would be impossible
for him to bring up a family, and the race of such workmen
could not last beyond the first generation."

Now, my friend, I know that some of your pretended friends, especially politicians, will tell you that Adam Smith wrote at the time of the American Revolution; that his words applied to England in that day, but not to the United States to-day. I want you to be honest with yourself, to consider candidly whether in your experience as a workman you have found conditions to be, on the whole, just as Adam Smith's words describe them. I trust your own good sense in this and everything. Don't let the politicians frighten you with a show of book learning: do your own thinking.

Capitalism began when a class of property owners employed other men to work for wages. The tendency was for wages to keep at a level just sufficient to enable the workers to maintain themselves and families. They had to get enough for families, you see, in order to reproduce their kind--to keep up the supply of laborers.

Competition was the law of life in the first period of capitalism. Capitalists competed with each other for markets. They were engaged in a mad scramble for profits. Foreign countries were attacked and new markets opened up; new inventions were rapidly introduced. And while the workers found that in normal conditions the employers were in what Adam Smith calls "a tacit combination" to keep wages down to the lowest level, and were obliged to combine into unions, there were times when, owing to the fierce competition among the employers, and the demand for labor being greatly in excess of the supply, wages went up without a struggle owing to the fact that one employer would try to outbid another. In other words, temporarily, the natural, "tacit combination" of the employers, to keep down wages, sometimes broke down.

Competition was called "the life of trade" in those days, and in a sense it was so. Under its mighty urge, new continents were explored and developed and brought within the circle of civilization. Sometimes this was done by means of brutal and bloody wars, for capitalism is never particular about the methods it adopts. To get profits is its only concern, and though its shekels "sweat blood and dirt," to adapt a celebrated phrase of Karl Marx, nobody cares. Under stress of competition, also, the development of mechanical production went on at a terrific pace; navigation was developed, so that the ocean became as a common highway.

In short, Jonathan, it is no wonder that men sang the praises of competition, that some of the greatest thinkers of the time looked upon competition as something sacred. Even the workers, seeing that they got higher wages when the keen and fierce competition created an excessive demand for labor, joined in the adoration of competition as a principle--but among themselves, in their struggles for better conditions, they avoided competition as much as possible and combined. Their instincts as wage-earners made them keen to see the folly of division and competition among themselves.

So competition, considered in connection with the evolution of society, had many good features. The competitive period was just as "good" as any other period in history and no more "wicked" than any other period.

But there was another side to the shield. As the competitive struggle among individual capitalists went on the weakest were crushed to the wall and fell down into the ranks of the wage workers. There was no system in production. Word came to the commercial world that there was a great market for certain manufactures in a foreign land and at once hundreds and even thousands of factories were worked to their utmost limit to meet that demand. The result was that in a little while the thing was overdone: there was a glut in the market, often attended by panic, stagnation and disaster. Rathbone Greg summed up the evils of competition in the following words:

"Competition gluts our markets, enables the rich to take advantage of the necessity of the poor, makes each man snatch the bread out of his neighbor's mouth, converts a nation of brethren into a mass of hostile units, and finally involves capitalists and laborers in one common ruin."

The crises due to this unregulated production, and the costliness of the struggles, led to the formation of joint-stock companies. Competition was giving way before a stronger force, the force of co-operation. There was still competition, but it was more and more between giants. To adopt a very homely simile, the bigger fish ate up the little ones so long as there were any, and then turned to a struggle among themselves.

Another thing that forced the development of industry and commerce away from competitive methods was the increasing costliness of the machinery of production. The new inventions, first of steam-power and later of electricity, involved an immense outlay, so that many persons had to combine their capitals in one common fund.

This process of eliminating competition has gone on with remarkable swiftness, so that we have now the great Trust Problem. Everyone recognizes to-day that the trusts practically control the life of the nation. It is the supreme issue in our politics and a challenge to the heart and brain of the nation.

Fifty years ago Karl Marx, the great Socialist economist, made the remarkable prophecy that this condition would arise. He lived in the heyday of competition, when it seemed utter folly to talk about the end of competition. He analyzed the situation, pointed to the process of big capitalists crushing out the little capitalists, the union of big capitalists, and the inevitable drift toward monopoly. He predicted that the process would continue until the whole industry, the main agencies of production and distribution at any rate, would be centralized in a few great monopolies, controlled by a very small handful of men. He showed with wonderful clearness that capitalism, the Great Idea of buy cheap and sell dear, carried within itself the germs of its own destruction.

And, of course, the wiseacres laughed. The learned ignorance of the wiseacre always compels him to laugh at the man with an idea that is new. Didn't the wiseacres imprison Galileo? Haven't they persecuted the pioneers in all ages? But Time has a habit of vindicating the pioneers while consigning the scoffing wiseacres to oblivion. Fifty years is a short time in human evolution but it has sufficed to establish the right of Marx to an honored place among the pioneers.

More than twenty-five years after Marx made his great prediction, there came to this country on a visit Mr. H.M. Hyndman, an English economist who is also known as one of the foremost living exponents of Socialism. The intensity of the competitive struggle was most marked, but he looked below the surface and saw a subtle current, a drift toward monopoly, which had gone unnoticed. He predicted the coming of the era of great trusts and combines. Again the wiseacres in their learned ignorance laughed and derided. The amiable gentleman who plays the part of flunkey at the Court of St. James, in London, wearing plush knee breeches, silver-buckled shoes and powdered wig, a marionette in the tinseled show of King Edward's court, was one of the wiseacres. He was then editor of the _New York Tribune_, and he declared that Mr. Hyndman was a "fool traveler" for making such a prediction. But in the very next year the Standard Oil Company was formed!

So we have the trust problem with us. Out of the bitter competitive struggle there has come a new condition, a new form of industrial ownership and enterprise. From the cradle to the grave we are encompassed by the trust.

Now, friend Jonathan, I need not tell you that the trusts have got the nation by the throat. You know it. But there is a passage, a question, in the letter you wrote me the other day from which I gather that you have not given the matter very close attention. You ask "How will the Socialists destroy the trusts which are hurting the people?"

I suppose that comes from your old associations with the Democratic Party. You think that it is possible to destroy the trusts, to undo the chain of social evolution, to go back twenty or fifty years to competitive conditions. You would restore competition. I have purposely gone into the historical development of the trust in order to show you how useless it would be to destroy the trusts and introduce competition again, even if that were possible. Now that you have mentally traced the origin of monopoly to its causes in competition, don't you see that if we could destroy the monopoly to-morrow and start fresh upon a basis of competition, the process of "big fish eat little fish" would begin again at once--_for that is competition_? And if the big ones eat the little ones up, then fight among themselves, won't the result be as before--that either one will crush the other, leaving a monopoly, or the competitors will join hands and agree not to fight, leaving monopoly again?

And, Jonathan, if there should be a return to the old-fashioned, free-for-all scramble for markets, would it be any better for the workers? Would there not be the same old struggle between the capitalists and the workers? Would not the workers still have to give much for little; to wear their lives away grinding out profits for the masters of their bread, of their very lives? Would there not be gluts as before, with panics, misery, unemployed armies sullenly parading the streets; idlers in mansions and toilers in hovels? You know very well that there would be all these, my friend, and I know that you are too sensible a fellow to think any longer about destroying the trusts. It cannot be done, Jonathan, and it would not be a good thing if it could be done.

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The Common Sense of SocialismChapter III: Part 3

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