Economic civics

Preface

This book is the result of a conv'ction that an understanding of some of the elementary principles underlying our economic life is necessary to good citizenship. In times when there is so much opportunity for misunderstanding between those who are associated in doing one and the same part of the world's work, it is particularly important that as far as possible every pupil in our schools shall have a chance to know why and how certain things are done in industry and what remedies are proposed to cure whatever unpleasant features are prevalent.

To put these laws and principles in language which the junior high school boy or girl can understand is not the easiest task in the world, even though questions of right and wrong can be made as clear to them as to older people. We believe, however, that such a study as is here undertaken not only is within their grasp but should be of tremendous help in enabling them to understand how the world works and how each one may do his part to the best advantage.

To make sure that every pupil understands the machinery of goveinmcnt which must deal with the problems set forth here, chapters three to five give such a brief survey of our governmental organization as is necessary to make clear how the government's part in business must be done. Teachers who arc certain that their pupils are thoroughly familiar with this can without harm omit these chapters.

P'or reference work in connection with the study of these topics we may mention the following texts which in part at least are not too difficult for pupils of the age for wliicli this book is intended :

Ely and Wicker, Elementary Economics (Macmillan).

IV

Preface

Burch and Nearing, Elements of Economics (Macmillan).

Carlton, Elementary Economics (Macmillan).

Laing, Introduction to Economics (Gregg).

Thompson, Elementary Economics (Sanborn).

Carver, Elementary Economics (Ginn).

Tufts, The Real Business of Living (Holt).

Smith, Commerce and Industry (Holt) .

Lessons in Community and National Life, United States Bureau of Education.

Burch and Patterson, American Social Problems (Macmillan).

Very helpful information can also be obtained from pamphlets issued in part for advertising purposes by various industrial concerns. The International Harvester Company, Washburn-Crosby Company, Swift and Company, Armstrong Cork Company, United States Rubber Company, Ford Motor Company, and many others have issued ^ publications which are both interesting and instructive. Suggestions for reference books for the study of vocations are given on page 189.

Wherever possible, let the pupil see the things go on as they do in the regular operations of business. Next to that, talks by persons who themselves are participants in what they describe will be helpful. The more the pupils feel that they are not merely getting book information but are becoming acquainted with the process of doing things, and are understanding the relations that do or ought to exist between workers and employers, between one set of workers and another, or between those who are connected with an industry and those who make use of its products, the more vital and worth while will be this study.

I have had the privilege of being associated in preparing a syllabus for use in the schools of Pennsylvania with Mr. Frank M. Leavitt, Associate Superintendent of the Pittsburgh Public Schools, who is himself the author of a little book that is a kind of pioneer in this field. In doing this

Preface v

work advantage was taken also of another outline which had previousl}' been prepared by Mr. Leavitt, Professor Commons, and Miss Weeks. Acknowledgment for helpful illustrations has been given in connection with their use in the text.

R. O. Hughes.

Peabody High School,

Pittsburgh,

February, 1921.

Chapter I. — The Things We Need Section

1. The People of the World

2. Things We Must Have .

3. The Bounties of Nature

4. What Has One a Right to Expect?

5. Why Some People Get Too Little

6. Why Some People Get Too Much

7. How the Needs of All Can Be Met

8. Security

9. Working with Other People .

10. The Square Deal ....

11. Enlighten.ment .....

PAGE

Chapter II. — The Things We Want

12. The Extent of Our Desires

13. Our Individual Desires .

14. Our Community Desires .

15. Desires — Good and Bad

16. Desires — Once and Now

17. Why We Want Things .

18. What Makes Things Valuable

19. Getting the Things We Want

20. Property That Is Our Own .

21. Liberty

22. The Chance to Get Ahead

Chapter III. —what Government Does For Us

23. Wiiv \Vf, Mu.st Have Government . . .37

24. CJovernment in the Early Family .... 39

25. How Social Oikjanizations Grew 39

20. Changes in Forms of Government .40

27. CiETTINfi GoVERNMKNT INTO THE IIaNDH OF THE PeoPLE 41

28. The Plan of Ouu Own CJovkunmiont .... 44

vii

Vlll

SECTION

29. Services of Governments To-day

30. Expenses op' Government

PAGE

Chapter IV. —our Duty To Our Government

31. Honoring Our Government 51

32. Social Service 53

33. Voting 54

34. Taxpaying 56

35. The Need of Intelligent Interest .... 57

36. Fields That We May Study 59

CHAPTER v. — THE MACHINERY OF GOVERNMENT

37. Our National Government

38. Our State Governments .

39. Our Local Governments

40. How Money Is Obtained

41. Classes of Taxes

42. Improvements in Taxation

43. Political Parties

44. Bad Effects of Parties

45. The English Cabinet System of Government

62 64 65 66 68 70 72 74 76

Chapter VI. — Foundations Of Our Nation's Life

46. What Makes a Nation? 79

47. The Factors in Industry 80

48. Services of Land and Natural Resources . . .81

49. Effects of Natural Conditions upon Industry . . 82

50. Private Ownership of Land 83

51. Problems of Land Ownership 87

52. Methods of Cultivating Land 89

53. The Waste of Natural Resources .... 92

54. Conserving Nature's Gifts 94

55. How Each Factor Needs the Others .... 99

56. Different F'eatures of Industrial Life . . . 101

IX

Chapter VII. — Producing Things Section

57. Stages of Industrial Progress

58. The Industrial Revolution .

59. DI^^sION of Labor and Its Effects

60. Special Products of Nations .

61. Communities That Specialize .

PAGE

Chapter VIII. — Modern Business

62. Factories .\nd Their Effect ...... 123

63. Capital and Its Importance ...... 125

64. Ways In Which Business Is Conducted . . . 127

65. Large Scale Production 131

66. Efficiency in Conducting Business .... 135

67. Monopolies 139

68. How Industrial Ch.\nges Have Affected the Far.m . 142

Chapter IX. — The Producers

69. Kinds of Industrial Activity

70. Classes of Workers

71. Rewards of the Workers

72. The Risks of Industry

73. The Work of Wo.men

74. The Work of Children .

75. Conditions of Work

76. Conditions at Home

77. Getting E.mploy.ment

78. Qualifying for a Position

79. The Number of Workers

80. Labor Unions .

81. Labor Controversies

82. The Need of Under.sta.\ding and Co6per.4Tion

83. Work on the Farm

149 151 152 154 156 158

ino

CH.\PTER X. — carrying GOODS

84. The Value and iMF'ORT.WfE of Trade .... 100

85. Early Means of Transportation 192

SECTION

86. The Railroad

87. Influences of the Railroads .

88. The Government and the Railroads .

89. Getting Funds for the Railroads

90. Other Agencies to Aid Transportation

91. Carrying Goods by Water

92. Trade between Nations ....

93. The Tariff and Trade ....

PAGE

Chapter XI. Conveniences Of Trade

94. Barter and Money 215

95. What Money Does for Us 216

96. Materials That Are Good for Money . . . 218

97. The Money of the United States .... 220

98. Substitutes for Money 223

99. The Importance of Credit 226

100. Banks and What They Do 228

101. The Federal Reserve System 231

102. How Banks Safeguard Their Business . . . 232

103. Paying Debts between Nations 235

104. Selling Stocks and Bonds 237

105. Keeping One's Word 240

Chapter XII. — Making Living Conditions Better

106. What Makes a Thing Cost? 244

107. Influences That Make Prices 247

108. What Determines One's Income? 249

109. Increasing One's Income 251

110. Living Costs in City and Country .... 252

111. Why Living Costs Have Increased .... 254

112. Are Luxuries Justifiable? 258

113. The Family Budget 256

114. Forms of Savings 260

115. Bad In\'estments 262

116. Good Ina^estments 264

117. Builders of Fortunes 266

118. The Rich Man's Responsibility , , . . . 269

XI y

CHAPTER XIII. — MAiaNG INDUSTRY BETTER BECnON

119. Improving Conditions of Work

120. Shorter Hours and More Money

121. Insuring the Workers ....

122. Providing Recre.\tion and Improvement

123. Houses for Workers ....

124. Sharing Profits with the Workers

125. Sharing Management with the Workers

126. How Workers Have Helped Themselves

127. Controlling Big Business

128. The People's Interest in Industry

129. Promoting Industrial Peace .

130. Should the Govern'ment C.\rry on Industry?

PAGE

Chapter XIV. —making Government And Society Better

131. How Much Is Wrong? .

132. The Contented and the Discontented

133. Some Radical Ideas .

134. Bolshevism ....

135. What the Socialist Believes

136. Can We Correct the Wrongs?

137. How Changes Come About

138. Which Way Is Best?

139. Making People Think

140. Your Part and Mine

LIST OF ILLUSTRATIONS

Different, Yet Alike

The Modest Farm Home

A Homestead in the Desert .

Violating Several Laws at Once

Keeping a City Safe

Our High School .

A Scene in the Tropics

High School and Stadium, Tacoma, Washington

The Boy Lincoln at Home

Part of One Day's Work

A Steam Hammer at Work .

A Rented Home

Texas State Capitol at Austin

The Great Charter of King John .

The Capitol at Washington .

How Some Public Money Was Spent .

Road Building in the Colorado Mountains

School Children Saluting the Flag

President Wilson Voting

What Irrigation Makes Possible .

The Supreme Court of the United States

The Capitol of Utah ....

Paying ITieir Income Tax .

A Political -Vdvortisement .

Parliament Building, London Cradling ......

An Up-to-Datc Indian Farm

Wonders of Nature Worth Preserving .

A Middle West Grain Farm

Diminishing Returns

Forest Destruction by Fire

A Fire Ixjokout

Arrowrock Dam, Idalio

Beaver Dam

The Faftors in Production

Rolling Hot Metal

XIV

List of Illustrations

A Survival of Old Times

Tending the Sheep

As It Was Done Once .

Spinners in a Modern Mill .

The Cobbler's Shop of the Old Days

Specialization in Shoe-Making

The Pillsbury Flour Mills .

A Modern Loom ....

How Capital Saves Labor

Where a Great Industry Began .

A Second Stage in the Meat Business

A Great Meat-Packing Establishment

Iron-Mining in Northern Minnesota

Beef vs. Shark ....

Overhead Organization in a Large Business

Machinery That Is Almost Human

The Usual Way to Plow

The First Exhibition of the Reaper

Plowing and Harrowing with a Tractor

Some "White Collar" Workers

Weaving in a Modern Mill .

Entrance to a Coal Mine

Healthful Work for Women .

At a Blast Furnace

Home Work in a New York Tenement

Livang Conditions That Need Improvement

Improvement .....

Bringing Workers and Jobs Together

Carnegie Institute of Technology, Pittsburgh

The Immigrant .....

A Modern Factory Plant

Old-Style Haying ....

Farmerettes at Work ....

Scientific Hay-Making ....

Taking Cotton to Market

The Stage Coach .....

"Joy Riding"? .....

The Old and the New ....

A Coal Pier of the Pennsylvania Railroad

Handling Parcel Post ....

A Relic of the Old Days

List of Illustrations

XV

PAGE

Bringing in the Mail ......... 206

A Ship in Dry Dock

. 207

Coahng Ships on the Delaware River

. 209

An Old Roman Coin .

. 216

A State Bank Dollar .

. 219

The Treasury Building

. 221

A Modern Bank Building

. 229

A Run on a Bank

. 233

The Interior of a Bank

. 237

Stock Certificate ....

. 238

New York's Financial Center

. 239

Unprofitable Transportation

. 245

Making Good ....

. 249

A Crowded City Street

. 253

Be Careful!!! ....

. 263

New York Public Library

. 265

Wealth in Old Clothes .

. 267

The Widener Library at Harvard

. 271

Working Oleomargarine

. 277

A Helpful Kind of Welfare Work

. 285

These .\re All from One Establishment

. 289

The Woolworth Building, New York

. 292

What One Strike Caused

. 299

Getting Together .

. 301

Unspeakable Living Conditions

. 309

Russian Peasants .

. 313

One Phase of Law-Enforcement

. 319

"Reds" Waiting for Trial

. 323

A Country Community Center

. 325

Chapter I

III fares the land, to hastening ills a prey Where wealth accumulates and men decay.

— Goldsmith.

1. The People of the World. — " It takes all kinds of people to make up a world." No doubt you have heard this said many a time. If you have ever stopped to think about the people whom you know yourself — and no one can be thoroughly acquainted with a very large number — you have discovered how true it is.

People not only have different tastes and talents, but are unlike in many other respects. What a motley collection of colors and costumes would one see if a convention of delegates from all the lands under the sun should assemble to discuss world peace or some other subject in which they all ought to be interested ! And how much trouble they might have in understanding one another ! The Frenchman and the Turk, the Engli.siiman and the Russian, the Filipino and the Chinaman would probably have to use " sign language " or have the help of an interpreter if they tried to carry on a conversation.

Yet with all thciir differences, men and women are in many ways alike wherever you find them. The (-reator did not make mere automatic machines which could be wound up like a clock and set to running. Every normal per.son po.s.se.sses the power to think, and lia.s to u.se that power to meet the situations that arise from day to day. If he is to be happy, or even to hve, he must have certain things. Some of these things are very largely under his own control, but others he can not produce, though he may have to decide how they shall be used. All people, however different, require certain necessary things in order to live in comfort.

How would you like to live in a world where all people were alike ?

Would you enjoy living in a world where everything was provided by Nature in just the form that you needed it, and where you did not have to plan for the future at aU?

2. Things We Must Have.

— What are some of these things which every one must have in order to live and to be happy? The most important are air, food, clothing, and shelter.

We breathe without thinking about it, as a rule. But let something happen which cuts off our supply of air and we find at once how necessary this thing is which is around us all the time, in spite of the fact that we can not see it.

Shut up a plant in a dark cellar and see how white and sickly looking it becomes. In just the same way do human beings suffer if they do not get the sunlight. And what would become of this old world if it were not for the heat of the sun's rays? Every animal must have its strength renewed from time to time by food, and some animals need a good deal of it. Men and women are no exception to this rule, as you know. But food does not usually come without effort on our part,

Different, Yet Alike.

The immigrant inspector can not talk with the would-be immigrant without the help of an interpreter.

If the inspector did not have his cap on, could you tell him from the others ?

like air and sunlight, even though we must have it. If it grows wild in the fields, some one must at least go where it is and gather it. Generally, too, we must give it some special preparation by cooking or otherwise.

In order to be comfortable we need clothing most of the time, especially in the colder climates. Besides, custom has become so strong among most people that they think they need more than is necessary merely for comfort, and want to have it in certain styles and varieties, so that they may dress

The Modest Farm Home.

The attractive scenes which surround this farnaer's dwelling ought to help atone for the absence of street-cars, movies, and conservatories. Does the family that lives here lack anything that is really essential to happiness ?

in accordance with standards which have somehow oi- other become established.

Then, too, in whatever part of the world we live, we need some kind of shelter. It may be to keep out the frost and cold of the northern winters or to gain relief from the burning sun or the drenching rains of the tropics. It may be the Eskimo's igloo or the African's thatched hut, the palace of a millionaire or tlie phiiner home which you and I enjoy — but every one needs some pliure for refuge, shelter, and rest.

3. The Bounties of Nature. — What chance have we of obtaining the things we need? Is it a hard, wearisome, unending struggle — this hfe into which we have come ? Surely a wise Creator would not place upon the earth a race of beings who must have certain things in order to exist, unless he also provided the means for meeting these needs. And these means are all at hand.

Air, sunlight, and often water are provided in such abundance that we may call them free goods. We have only to take them and they are ours. Other things, which we can not secure without some effort or sacrifice, great or small, we call economic goods. But for these also the. materials are given to us, and we need but to make use of brain, muscle, energy, and time in order to get them. The plants produce seeds, which we can put in the ground and thus raise more plants. The ores wait in the mountain rocks or beneath the surface of the ground for the miner's pick or the steam shovel or the powder blast to tear them loose. The wood of the forest giant can be turned and carved and fashioned until it may serve our needs in a hundred ways.

Of all these there has been in the world enough and much more than enough to meet every need of every man and woman who ever lived. We must keep from wasting these gifts of Nature, it is true, but she has never failed to give us enough. When the supply of one commodity fails, something else is ready to take its place. Wood, coal, gas, and oil have all served in part the same purpose. When these run low, the streams may still give us power to generate the mighty force of electricity ; and who knows but sometime we may even harness the sunlight?

4. What Has One a Right to Expect?— "The world

owes every man a living." So some people have said, usually in excusing themselves for not working. If that is the reason, perhaps they expect too much, for surely one ought to be willing to do a reasonable amount of work in return for Nature's gifts. But if Nature has been so bountiful as we have said, there are certainly some things which every one may have the right to expect and of which no one should be deprived, if he does his part to earn them. Some of these — food, shelter, and clothing — we have alreadj^ mentioned. Food we must have, for as we have said, no one can live without it. But how much? Surely one may expect more than just enough to live on. The variety and amount of

^^^^J^^v^S^daB&uiiXBML

CuurlL^U ul Utclamatlon Service.

A Homestead in the Desert.

In the Shoshone irrigation project, Wyoming. It must take courage and ambition to start home-building in a place like this. With what does Nature supply this man ? What must he get along without, which you and 1 think we ought to have ?

food will vary with a man's physical make-up and manner of living. Yet every one, rich and poor alike, has the right to expect enough of it to keep him strong and health}'.

Then every one should at least have sufficient clothing to protect him and at the same time to give him a neat appearance. This does not mean thai all should demand fine, expcmsive clothes. But every one surely has the right to expect enough for health and comfort, simple though it may Ix-. To satisfy tlu; need for sheltitr men hav(^ learned to build houses. To-day surely one may expect a dwelling of some sort, where he may enjoy a real home life.

But man is naturally a sociable creature. He not only likes but really needs some form of recreation and some change outside of the routine of his daily life. Since this is so, he has the right to expect the opportunity to earn more than enough for mere existence, or to supply simply the necessary food, clothing, and shelter. He can rightly ask that he may have this enjojonent and at the same time lay by a few savings for his old age. He ought to have some chance, too, for improving himself mentally and morally, both for his own benefit and in order to become a more capable and valuable citizen. He should also be able to give his children such education as will make them intelligent, self-reliant, and honorable.

That every one may have all these things is surely not too high an ideal for a community or a nation. To have less, indeed, would mean that one was handicapped at the start in the race of life. And, as we have said, there is in the world enough of the needful things to supply each human being, if no one acquires more than his share.

Should all people expect the same things, in quality or amount ? Has any one the right to expect more than another ?

5. Why Some People Get Too Little. — But there are many people in this world who get far less than this. They do not even have enough to supply the real needs of life, and can enjoy hardly any of its pleasures. For every millionaire there may be a thousand paupers.

Now why do these people get too little? Why is their share of things so much smaller than we have said one has a right to expect?

(1) Sometimes physical weakness of some kind is responsible. The blind man who stands on the comer trying to get a httle money by playing a cheap mouth organ is an example of this. Sickness often keeps one from earning his regular wages, and if it is long continued may unfit him for doing any work that is difficult. Such a weakness is not in all cases a handicap. Often men and Avomen have accomplished wonders in spite of it. But such people certainly deserve a great deal of credit, for usually they live and work under a great disadvantage.

Can you mention some famous men or women who were blind or who were constant sufferers from some bodily illness or misfortune ?

(2) By contrast we may notice the man who is noted for laziness and lack of ambition. He possesses no desire to do his work well or to make a success of it, but prefers an aimless life of idleness. And so he gets small returns and perhaps does not deserve even these.

(3) Another reason why many people get too little is their lack of ability. A man may be a hard worker and desire to get ahead, but because he lacks talent or education or experience, he does not succeed. For this reason many a person is forced to accept too little to live on decently.

(4) Some people through their own extravagance do not have enough. They may have the ability to earn but they seem to be unable to save. ^Vhat money they get they spend lavishly for expensive food, clothing, and luxuries, or throw it away in some foolish investment by means of which they hope to get wealth}'. Then they must almost starve for a while. Small wonder it is that most of the time they have too little.

(5) Another reason to-da}' why jjcople do not have enough is greed and unfairness. People arc actually robbed. Some one takes more than he has a right to have, and what he gets must l)c at the expense of some one else. The ix^ojjle who are getting less than they deserve are often not able to exert sufficient power to obtain their dues.

The burglar, who takes a person's money and jewels, however, is not I lie only tliief. Some men show no eonscience in flealing with their fellow men. Tlu-y do nol hesitate to take advantage of anolluir's needs and comix-l him to pay them, for their goods or services, prices far beyond what they are worth. Profiteers, we call such people. But if men are to live they must pay the prices charged for the things by which they must live. That is where some of the people's money goes which ought to enable every honest, hard-working man to have a comfortable living. That is why some people get too little — because others get more than their share.

How many of these causes of poverty are the fault of the indi^^dual and how many are the fault of society in general? WiU there always be poor people ? Do j'ou think any one, even though he is physically inefficient in some way, should go about begging ? What should be done with the lazy man who has no ambition? What do you think are the causes of laziness? Can the condition be remedied ? How can the hard worker who lacks ability be helped ? Can we get rid of the profiteer ? How ? If a condition exists where many men get too little, what is it likely to lead to ?

6. Why Some People Get Too Much. — First of all, what do we mean by " too much "? Surely it is not simply a condition of having more than some one else, for perhaps the one who has the larger amount worked hard while another man loafed. Perhaps we can agree that a person has too much if in order to get it he must force some other person to suffer, or if the possession of it causes him to fall into habits of laziness, wastefulness, or some other undesirable manner of living.

(1) A person may owe his wealth entirely to luck — if it is proper to use that word at all. He may have been born in a wealthy family. Or perhaps some rich uncle may have presented him with some valuable gift or may have died and left him a fortune. Such occasions are not very common, it is true, but they do occur. In all these cases the individual himself is not responsible for his wealth, and is under a great temptation to live in lazy enjojonent, simply as one of the idle rich, who do no good to the world.

(2) Some men to-day have obtained their wealth largely through dishonesty. Besides the robber who makes a practice of taking the goods of others, there are men who, although they appear to be good, really become rich by depriving others of their share. The rich mill owner, who works his men like slaves and gives them low wages ; the speculator, who sells worthless stock to persons w^ho have saved up a little mone}^, and the profiteer who charges enormous prices for the necessities of'life, knowing that the people must pa}^ or do without, all belong in this class.

(3) Then there is the man who through influence of some kind gets paid for work which he does not do. Especially do we see this in public offices. Too often a person wuth political influence backing him is the one who gains recognition and good pay, while another man, perhaps much better equipped for the office, but unkno^^^l, is denied the opportunity to attain the honor or the reward of service.

(4) Other persons through greed and selfishness amass fortunes. The money they earn is carefully hoarded and they make sure that none of it is used for the benefit or pleasure of any except themselves. Such people naturally have more than is necessary for their use.

(5) Still another reason why some men get more than they earn is the extravagance and folly of others. Many people will pay too much for something that they al)solutely do not need, rathei' than not have it. The}- do not have the brains, or if they have them do not use them, to distinguish between a wise and a foolish way to spend or invest. The saloon keeper often argued, " If these fellows are going to throw away their money, why shouldn't I get it as well as anybody else ? " The promoter of piize fights, the fashionable hairdresser, the clairvoyant and fortuneteller, are all willing to take the coin from those who " spend money for that which is not bread." If these i)e()ple get more than they deserve, the blame rests partly on those who let them get it.

Is thcro any limit to what pcoph- fan earn lioin-slly'.' Is it dc- 8iral)I(! for p«'<)i)I(! to liavo more t liati ciioiitrli l'<>r rcjisotL-ililf cotiit'ort ? What may be the result?

7. How the Needs of All Can Be Met. — From what we have just observed about people who have too little and people who have too much, it is evident that no one cause can be blamed for the uneven division of the good things and pleasures of life. Yet it is clear that if every one understood as much as every other person about the principles that underlie the success or failure of people, there would be less want and waste and abuse of others' rights.