The economic and social problem

Front matter

Class rj I'Sff^

:x

Book.

Contents

CHAPTER PAGES

I. A Problem and its Solution - - 1-16

IV. Circulation 1 15-149

Chapter I. A Problem And Its Solution

The great social problem is : First, the question wh}' a growing number of workers have to go without necessaries and luxuries, though only too anxious to produce them for each other; and Second, what are the obstacles interposed against the exertion of their productive power?

"I gave a beggar from my little store Of well earned gold. He spent the shining ore And came again and yet again, still cold And hungry as before.

I gave a thought, and through that thought of mine He found himself a man. supreme, divine.

Bold, clothed, and crowned with blessings manifold, And now he begs no more."

— Ella Wheeler Wilcox.

A caravan trudges wearily through the hot sand of the desert. At last an oasis is reached, and all rush toward the life-giving fluid. But only a meagre quantity is found, hardly sufficient for all, and already the more vigorous travellers are making use of their strength to monopolize this supply. Weak and tired pilgrims whose strength had barely sufficed to permit their reaching the oasis, despair of being able to force their way to the spring.

Fortunately the leader approaches, and his exhortations are heard. He asks the strong ones to moderate their greed, and to let their poor brethren obtain some of the water. He shows them how wrong it is for them to store away water for future use before others* have as much as quenched their thirst.

Who has not heard this gospel, preached in the holy writings of all peoples, resounding from every pulpit of our churches? They are old, very old, these admonitions — as old as humanity. Our parents have heard them before us. their parents before them, and their echoes come down to us, faintly and more faintly, from the ever-receding generations of the past.

But do not let us, in pondering over these glorious teachings" of r THE ECONOMIC AND SOCIAL PROBLEM.

the brotherhood of man, of unselfish love and devotion, of charity and benevolence, of the division of the last loaf and coat, forget to look after our caravan, which, meanwhile, has continued its march.

The desert now lies behind the pilgrims, and a wonderful valley opens before their astonished eyes. As far as they can see, extends quite a forest of fruit trees bending under their precious loads, while blooming meadows crossed by lovely little rivulets invite the wanderer to a delicious rest. Sweet feathered songsters fill the balmy air with their delightful melodies. A real paradise, from which cares and troubles of any kind seem forever banished, opens its inviting arms to our footsore travellers. Nearer and nearer they approach to it ; already they see the entrance of the valley, and in a few hours they expect to rest there refreshed and happy.

But, oh. how dreadful ! A roaring torrent separates them from the valley ; its foaming rapids interpose a seemingly impassable barrier between our poor pilgrims and the lovely paradise.

A few intrepid men throw themselves into the seething waters ; but most of them perish before the eyes of their companions, who cannot succor them. Only a few hardy swimmers succeed in reaching the opposite shore. The majority cannot swim and must remain on the barren side of the stream.

By irrigating the soil they raise scanty crops, and with the help of the fruits thrown over from the other side they manage to eke out a bare living. Unfortunately, most of the fruit thus thrown fails to reach the bank of the stream, and that which is successfully aimed is nearly always injured in its fall. The majority of the lucky ones, moreover, prefer to take their ease in the paradise they have attained to, little heeding the entreating voice of the leader which is wafted to them over the stream.

Again and again it makes itself heard, that old and well-known command of charity, and more than ever since the world exists, it is obeyed. A few of the successful swimmers, a Leo Tolstoy, for instance, seeing how little can. after all. be accomplished by almsgiving, renounce their enjoyments rather than monopcjtize them; and, braving all hardships, return to their brethren so that they may partake of poverty with them.

Good, well-meaning men they, and those also who without tiring, throw fruits over, most of which are spoilt or never arrive, and are carried to the ocean by the waves of the stream. Wiser men, however, those few exceptional thinkers who spend day and night of their lives considering whether it might not be possible to construct a bridge by which the whole caravan could be brought over into the happy valley. They are not in the least deterred by the jibes (jr threats of the others, even of those whom to help they strain every nerve. "A bridge over such a wide and unfathomable stream! What a ITopia ! The fools had better make use of their precious time to throw us some more fruits !" Such are the shouts occasionally coming over to them from the other shore.

A proble:m Axn its solution. .^

■ Humanity has arrived at the border of the desert through which it has been wandering during so many centuries. A hard and continuous fight against terrible odds has marked the different stages of the struggle so far. Where the stronger managed to secure a larger share the weaker ones suffered in consequence, and the exhortations of the moral leaders again and again demanded justice, ■or at least charity. Where entreaty proved without effect, threats had to help. The most terrible torments of supposititious hells, cruel inventions of human fanaticism, have been shown in prospective to the hard-hearted rich, whose entrance into heaven has been made to appear more difificult than the passage of a camel through a needle's eye.

Meanwhile, gradually, almost imperceptibly, the outlook on the march has changed. Let us listen to some of the observers.

"On the virgin soil of America's prairies lOO men, with the help of powerful machines, produce in a few months the bread required by 10,000 men during a year. The wonders obtained in industry are still more astonishing. With those intelligent beings, the modern machines, the achievements of three or four generations of inventors, mostly unknown, 100 men produce the clothing which 10,000 men require during two years. In well-organized coal-mines 100 men extract yearly enough fuel to supply warmth for 10,000 families m a rough climate." (Kropotkine, "The Conquest of Bread.")

Let us double, yea, even treble the number of persons required to cater for man's wants, and we arrive at the result that less than one-tenth of the population could supply all with the necessaries of life. This accords with the calculation of others. Dr. Theodor Hertzka, for instance, the *we11-known Austrian economist, who, in "Die Gesetze der sozialen Entwicklung," figures out what labor will be required to produce the common necessaries of life for the 22,000,000 inhabitants of Austria ; with the result that agriculture and all industries, including mining and building, need 615,000 persons, during present working hours, 300 days a year to provide the whole population with the necessaries of life. But these 615,000 laborers are 12.3 per cent, of the population able to work, excluding all women and all persons under 16 years or over 50 years of age. Hence, should the '5.000,000 individuals, instead of 615,000 be engaged in work, they would need to work only 36.9 days every year to produce everything needed for the support of the population of Austria. But should all the 5,000,000 work all the year — say 300 days — each would need to work only about one hour per day. To produce all the luxuries now used, in addition, these 5,000,000 would need to work only another half hour a day.

A book could be filled with statistics proving our immense progress in the arts of production and communication. I give a few items from an address delivered in Boston by Professor Frank Parsons : "Steam and electricity, and mechanical contrivances have multiplied the productive power of labor many-fold. A sewing

4 THE ECONOMIC AND SOCIAL PRonLEM.

machine will do the work of 12 to 15 women. A Al'Kay machine enables one workman to sole 300 to 600 pairs of shoes a clay ; while he could handle but 5 or 6 pairs a day by former methods. A good locomotive will pull as much as could 800 horses or 8,000 men ; 4 men with the aid of machinery can plant, raise, harvest, mill, and carry to market wheat enough to supply with bread 1,000 people for a year. A girl in a cotton mill can turn out calico enough in a year to clothe 12.000 persons, more or less, depending somewhat on the size of the persons, and the number of changes of cotton they have. The total machine power of the country is equivalent to the labor of half a billion willing slaves, or an average of 20 to every human worker. On the basis of slavery, the Athenians built up a civilization in which every free man might have ample leisure for culture, and civic and social life. On the grander basis of service by the power of Nature, we are building up a civilization in which all shall be truly- free, and shall enjoy ample leisure for development and association with far greater means for both than the Athenians ever possessed. In Athens, during her palmiest days, there were 5 or 6 slaves for every free man ; our machinery already equals 20 for every worker, and in another fifty years may equal 40, 50. 60, or more for every man ; or 100. perhaps, for every family. And these splendid servitors of steel and brass are exempt from the pangs of hunger and cold, are never oppressed with weariness, lose no liberty in their servitude, and find no misery in subjection."

From Brotherhood, of May, 1900: "Mr. Ernest H. Crosby tells of a factory he inspected where the manufacture of cheap socks was carried on. The manager showed him 400 sock-making machines. The machines run 24 hours a day, and only 50 boys are needed for all shifts ; 5,000 dozen of socks are made daily. Under the old method, this work would have required about 50,000 men or women."

Leone Levy has calculated that to make hy hand all the yarn spun in England by the use of the self-acting mule would take 100.000.000 men. It is reckoned that 30 men, with modern machinery, could do all the cotton spinning done in Lancashire a century and a half ago.

William Godwin Mcxjdy, of Brooklyn, author of "Land and Labor in the United States." and "Our Labor Difficulties." sworn and examined before the .Senate Committee on Education and Labor, in 1885. says: "Now one girl with her loom will weave as much cloth as could 100 women in my mother's time. One man will go into the field to-day and will do the work that required from 50 to 100 men to do when I was a boy." Question. "Do you mean in agricultural pursuits?" Answer. "Yes. A single man with a reaping machine, one of the smallest capacity, with 6 or 7 feet cutting board, will go into the field and will cut and bind from 15 to 20 acres of grain in a day of ten hours. When my father went into the field with a sickle upon his arm. it took four men a full day to cut and bind a -iu'^lc acre, and the Scotch Agricultural Society

A PROBLEM A Nil l( S SOLUTION, 5

reported, in an examination upon that matter, that it required five men for one day to cut and bind one acre of grain ; but now one man will cut and bind from 15 to 20 per day ; or, going beyond that, one of the improved machines will cut and thresh and sack the yield of 50 acres in a day."

'"The steam-gang plow, combined with a seeder and a harrow, has reduced the time required for human labor (in plowing, sowing and harrowing) to produce a bushel of wheat, on an average, from 32.8 minutes in 1830 to 2,2 minutes at the present time. It has reduced the time of animal labor per bushel from 57 to ij^ minutes. . . . Before Whitney's invention it required the work of one person ten hours to take the seeds from one and a half pounds of cotton. The machine will now do, in the same ten hours, more than four thousand times as much. ... A steam shovel will do in eight minutes what one man can do, with difficulty, in ten, hours. The dirt may be unloaded from a train of cars in six minutes, that would require, with a shovel, a day's work of ten men. A stone crusher will perform the work of six hundred men." — (The Social Unrest, John Graham. Brooks.)

We see, as far as productive power is concerned, that the paradise of our picture has been reached. Where this power has increased from ten to twenty-fold, on. the average, in the course of centuries, there ought to be more than enough product for all; and other exhortations ought to take the place of those which long ages have so accustomed us to, that the following admonition of an American Fabian is quite in its place : "London boasts of her i6,ooo,ooo in missions, etc., besides uncounted sums in private almsgiving, while New York records with pride her $5,000,000 spent in municipal charity, her $5,000,000 in organized charity, her $5,000,000 given by societies, $5,000,000 by churches, and $10,000,000 of private personal giving — $30,000,000 in all.

"Instead of exulting in the fact that she gives $30,000,000 a year 'to the poor,' New York should rather hide her head in shame that she has so many poor to give to. What sort of an economic system is this which works so badly that $30,000,000 a year will scantily serve to patch it up? Is this peace or is it war which requires a city to expend $30,000,000 a year in the gathering up and caring for part of the crushed, the diseased, the mangled, and the disabled of its citizens?

"A really intelligent community would as soon think of boasting of its epidemics and diseases as of its expenditure for 'the poor' — would as soon vaunt itself on the length of its death list, as upon the magnitude of its charities. Pompous rehearsals of the sums given 'for sweet charity' are to be sighed over rather than rejoiced in."

Few of those who discuss the social problem are aware of the fact that the term has entirely changed its meaning. Formerly the wealth of the few was not only in glaring contrast with the poverty

O THE hXONOMIC AM) SOCIAL I'RDIU-KM.

of the many, but it supplied one Cailse of this poverty. One only, for, in any case, primitive methods of production, transportation and communication, the destructive agencies of nature and of man. did not permit wealth-accumulation by the producer. When, m addition, a powerful minority robbed the masses of a more or less considerable portion of their share, the explanation of the prevailing misery did not offer any difficulty to the student of history.

As though by a sorcerer's magic wand, the Spirit of Invention created a new world. The .spoilt children of the twentieth century, with its enormous technic progress, can hardly realize that men are still Hving who travelled on roads inferior to those of ancient Rome, in vehicles not much superior to those used two thousand years ago, men, who saw the spinning-wheel and hand-loom supply most of the people's clothing; other commodities being produced by similar primitive methods. Productive power has grown at lea'^t ten-fold within a single century.*

I speak advisedly when I say productive power or productivit\ , instead of production ; for actual production lags more and more behind potential production, productivity. It is this discrepancy which we usually call overproduction, though in reality it is nndcrprodnction. and this underproduction is the riddle of the economic Sphinx, the social problem of modern civilization.

We have underproduction m a double sense : a relative underproduction as compared with potential production or productive power, and an absolute underproduction of the necessaries of life mostly needed by the unemployed starving workers ; starving, because without purchasing power ; without purchasing power, because unemployed ; and unemployed in consequence of relative underproduction. Tailors go in rags and cannot buy clothing or

*The best and shortest summary of this progress has been given by Professor E. E. DolBear ; "The nineteenth century received from its predecessors the horse; we bequeath the bicycle, the locomotive, and the automobile. We received the goose-quill ; we bequeath the fountain-pen and typewriter. We received the scythe; we bequeath the mowmg machine. We re ceived the >ickle ; we bequeath the harvester We received the hand printing press; we bequeath the Hoe-cylinder press. We received the painter's brush ; we bequcatli lithography, the camera, and color photography We re ceived the hand loom ; we bequeath the cotton and woolen factory. We received gun-powder; we bequeath nitroglycerine. We received twenty-three chemical elements ; we bequeath eighty. We received the tallow dip ; we bequeath the arc liglit. We received the galvanic battery ; we bequeath the dynamo. We received the flint lock ; we bequeath automatic Ma.xmis. We received the sailing ship; we bequeath the steamship. We received the beacon signal-tire; we bequeath tlie telephone and wireless telegraphy. We received leather tire-buckets ; we bequeath the steam tire-enginc We received wood and stone for structures ; we bequeath twenty-storied steel Innldmgs. We received the stairway; we bcqueatli tlie elevator. Wc received ordmary light; we bequeath the Rimtgen rays. We received the weatlier unannounced ; we bequeath the weather bureau. We received the unalleviablc pain ; we bequeath aseptics, chloroform, ether, and cocaine. We received the average duration of life of thirty years; we bequeath forty years."

A PROBLEM AND ITS SOLUTION. ^

the raw material out of which to make clothing, because the money to buy it with is inaccessible through absence of work, due to an insufficient demand f6r other people's clothing.

Workers in the building-trades are houseless, because too many houses have been built and few more are needed. Thus deprived of work, they cannot pay rent. And so we could go on through the whole list of necessaries and luxuries. Everywhere we find want, through absence of employment, due to the so-called "overproduction" of really underproduced goods, and overproduction not in one department of production, balanced by a temporary underproduction in another, but a general overproduction. Occasionally we still find fossils who confound the commercial crisis, which embraces all departments of production with those difficulties under which certain expiring methods of production suffer in consequence of new inventions, such as hand-weaving after the introduction of the power-loom, or nailmaking by hand after machine nails came up.

To increase the confusion we hear the very men who raise the cry of overproduction in the face of absolute and relative underproduction, speak of overpopulation, as if we could have overpopulation and overproduction at one and the same time, overpopulation being necessarily correlated with underproduction of the necessaries of life. Overpopulation may in reality exist where the system of production is so primitive that the yield of the land is insufficient to produce sustenance for all its inhabitants. Parts of the United States may have been overpopulated before the white man came here, where the Indian hunter did not find game enough in his tribe's territory to supply nutriment for all ; although a much larger population afterward found plenty of food in the same region, when the white farmer had begun to plow the soil. Intensive culture under the progress of agronomy can feed increasing populations on areas where a few farmers working on primitive systems almost starved. P. Kropotkin, in "Fields, Factories and Workshops," cites instances of crops of 80 bushels of wheat to the acre. Under special conditions, the yearly food of a man, about 8^ bushels of wheat, has been obtained from less than a twentieth of an acre, which is an equivalent to over 170 bushels to the acre. Thirty tons or 1,120 bushels of potatoes have been dug in Minnesota from one acre in one single year. The Island of Jersey, in the British Channel, is famous for market gardening. Kropotkin gives the wonderful results obtained by a single gardener, with the help of 36 men and boys, on 13 acres, "equivalent to what a farmer would usually obtain from 13 hundred acres of land." He shows how even a well populated country, like England, without reducing the area devoted to other industries, could amply feed herself from her own soil, independent of all food importations, except tropical produce.

In this way the population of the earth could be increased ten-fold, twenty-fold, a hundred-fold and more, without having to fear

8 THE FXONOMIC AND SOCIAL PROBLEM.

Starvation. Which shows how little Malthusianism, the fear that population has the tendency to outgrow the means of existence. need trouble us in a time which has no more vexing problem than how to keep back production, because the supply in our markets show an increasing tendency to outrun the effective demand ; i. e , the demand backed by purchasing power. Notwithstanding this, prominent economists (John Stuart Mill, for instance) let the bugbear of overpopulation run through their works, everywhere appearing as the main danger and the inevitable outcome of any improvement.

How enviable were our forebears with their simple problem of poverty through lack of productive power! How different and difficult a problem is this which faces us, want through a teeming productivity ; misery appealing to inexhaustible sources of wealth ! What disposition can he made of it until the key to the well-filled storehouse can be found? And the key must be found, or our civilization is doomed.

To help us m our task let us make use of a familiar artifice : let us transport ourselves to Robinson Crusoe's Island and there present the case free from confusing side issues.

Robinson Crusoe, on his island, had to work all day to satisfy his needs. When he got Friday to work for him, things began to improve. He got a little leisure once in a while, and could think of producing articles of luxury. More slaves were procured. The result was complete exemption from work and a greater amount of luxury for Robinson, while the slaves had to work all day long with their primitive tools to provide this luxurv and the necessary means of .Subsistence for all. Often the men suffered want. That was the social problem of the past. A ship arrived brmging them all the tools and machines which technical science has given to civilized humanity. Very soon the slaves learnt how to use them. Their productive power increased immensely Where formerly the work of thirty slaves, and that of their families, was necessary to provide the entire colony with clothing, a smgle producer was sufficient now, and yet everybody was clothed better than before ; for the cotton gin, the spinning jenny, the improved weaving-machine, and other inventions of the same kind, so much facilitated the work for the one worker, that he was enabled to achieve more than a hundred could before. Great progress was also made in agriculture, in bread-making, house-building, and, in fact, in all industries, which before had been carried on by hand. Everywhere hands could be spared, and yet there was a larger production than before, so that all could live in abundance. The imemployed workers could now produce articles of luxury, which before could not be obtained. Furniture, carpets, table services, and jewelry, works of art of all kinds were made — in fact, all such things as the settlers could wish for. In time, machines and tools, as well as methods of production, improved more and more, so that workers in all

A PROBLEM AND ITS SOLUTION. 9

branches could be spared. What did it matter? A great many .more articles of luxury were invented and provided. One of the slaves, who was very talented, entertained the company with musical and theatrical performances ; another wrote books ; others built pleasure carriages and yachts, etc. The .general well-being increased continually with the increasing facility of satisfying every wish, and the labor time was reduced all around.

All this was very good until one day Robinson got up in bad humor, and gave the order to stop the general good living of the slaves, which did not please him. "He alone had a right to enjoy all those luxuries which everybody had been partaking of ; and the slaves ought to be satisfied if they got enough to eat and to drink, and had protection against wet and cold. All indulgence beyond this point only made them lazy and vicious." From that day the slaves were forced to live accordingly.

A week after this, when Robinson took a walk, he saw a great number of slaves standing about, doing nothing. He angrily called his head man, and gave him strict orders that only those who worked were to eat, and have clothes and lodgings. He was perfectly astonished when, some tinie after this, the head man came to tell him that a number of the men were dying of want.

"Are you mad?" Robinson asked him; "has not the island got more of all the good things which man needs, than we could wish for, and can we not produce as much more as we like? Are there not victuals enough? Are we short of clothing or of houses?"

"On the contrary," the head man humbly replied, "we are forced to build new store-houses, because the old ones are filled to the top wath food and clothing, and a great many of the dwelling-houses are empty."

"Well?" asked Robinson, whose astonishment increased.

"Yes, sir, that is all right ; but you ordered that only those who work are to be fed, clothed and housed."

"Certainly ; and that w as only right. Why don't the lazy fellows work?"

"Because there is no work for them."

"No work?" said Robinson, more and more astounded, and feeling his head to be sure that he was not dreaming. "No work? Are you crazy, my man?"

"No, sir," replied the head man, who felt offended. "I have got all my senses about me, and should be very grateful to my master if he would show me what work I am to give the men. In the brewery, to begin with, three men were employed who had plenty of work in providing the beer for our people. Since your lordship has forbidden this luxury, so that only the beer for your table has to be brewed, I had to take away two of the brewers, and the third is only busy one-tenth of his time, so that he is also doing the work of others, who consequently are out of work now. It is the same with the people who made the carpets and all the lO TH1-: KCONOMIC AND SOCIAL PROBLEM.

Other articles of luxury. Your lordship is abundantly provided for, but the others are not to have any ; so I have to take the workmen from their work of production."

Robinson learnt a great lesson that day, which our economists and statesmen, as it seems, have yet to be taught; a lesson which, in fact, we ought to ponder over, if we don't want it driven home to our minds some day in a fashion we shall hardly relish ; the lesson that zue cannot produce if ive do not consume.

In order to simplify matters I made the workers of the island Robinson's slaves. To make him the owner of the land, whose "free" inhabitants were his tenants or wage-workers, would merely complicate the relation, without changing anything in the final result. They are just as dependent on Robinson if they cannot get away or if emigration only means the exchange of one Robinson for another. They are what Robert Hunter calls "wage-slaves whose owners have been freed from caring for them when sick or unemployed."

Robinson would only employ them or let them have land when he needed their products or their labor. Under the original primitive condition he needed all of these products which they could spare after providing for their own sustenance. Then there was plentv of work for all. There was no question of overproduction and want of employment in those days ; it was "the good old time," when all went well as long as nature behaved, men kept the peace, and master or landlord was not too harsh and exacting.

The trouble began only when modern improvements became accessible, when each worker could easily produce ten times as much as before, and when Robinson would not allow their consumption to keep up with their increased productive power, while his own consumption could not be forced up sufficiently to take care of the balance. Then the workers starved because their work was too productive, in which case it proved immaterial whether this starvation was due to non-employment or inability to obtain land, and whether overproduction or overpopulation was looked upon as the cause.

They were in the position of men athirst, yet at the same time drowning in rising waters ; rising, because the poor fellows were not allowed to use the water for their own needs. They had been much better ofif before the flood rose, at the time when pumping procured just enough water for daily use; because then the owner of the precious liquid had to let them have enough to keep them alive ; for dead men could not pump any water for him.