Labor in the changing world

Preface

Now that the conflict of nations is ended, let us hope forever, another conflict, the abiding and paramount issue between labor and capital, takes the center of the stage. What is that issue? Whither is it driving us? What way of deliverance is possible from the grievous disturbances and monstrous evils which it reveals ? These questions I have sought to discuss and if possible to answer in this little book.

I have limited myself to the central question, the place of labor in the industrial system. The real issue lies beyond the recriminations in which both sides indulge. It is of course natural that the workers should insist on the exploiting selfishness of employers in general, and that employers should charge the workers in general with slackness and irresponsibility. Each party can bring evidence to support its indictment. But what is the conclusion? That workers, in the situation of employers, would be less grasping? Or that employers would be more industrious and "loyal" if vi PREFACE

put in the place of working men? Of course not. And if not, although the aforementioned evidence is symptomatic, the recrimination, the ethical condemnation, is vain. For it is the difference in situation that evokes the difference in character. It is due to the unlike fate of like-motived human beings within the economic system. The system, with its assignment of power and lack of power, of opportunity and lack of opportunity, the system with its evocation of the tempers and attitudes akin to the necessities which it imposes — the system alone is impeached.

Every great social division divides also, at just this point, the thoughts of men. For it raises this fundamental question: Shall we impute the responsibility to human nature primarily, assuming that the system, or lack of system, within which the division falls, is on the whole consequence and not cause; or have we ground for the belief that a practicable change of system would mitigate, if not heal, the division? The conservative answers, "You must first change human nature," assuming also, as a rule, that this is not practicable, perhaps not desirable. The advocate of reform answers that a change of system can, without changing

PREFACE vii

human nature at all, reveal a change of heart. Most obviously this question is raised to-day in respect of the disastrous international divisions of the civilized world; and according as men in general are led to accept one or the other of these alternatives, the whole future of the world will turn this way or that.

And surely no less may be said of this other great cause of offense, the economic division summed up in the words "labor" and "capital." Have we any basis here for the more optimistic view that a change of system can precede and evoke a change of heart — or, more precisely, for that is all our argument requires, an effective change of mood?

Patchwork will certainly not avail, and I have therefore laid no stress on the half-hearted and sometimes deceptive devices that pass under the names of profit-sharing and "co-partnership," nor yet on those conciliation schemes which, however useful in their own place, are calculated to bolster up the existent order. On the other hand, the success of such experiments as have seriously attempted to organize production to serve the common interest of the producers encourages the hope via PREFACE

that a real program of industrial reconstruction is not only necessary but feasible.

But, apart from such experiments, there are certain general considerations which may here be advanced. It is in the first place necessary to regard the industrial system as an evolution without fixity or finality, and assuredly dependent at any time on the motives of its half-creators and half-slaves — for it is true of every institution that it both springs from and dominates the wills of men. When the will of a large class within the system changes — and I try to show in what follows that it has been changing rapidly — the system itself either changes or breaks. It breaks if the dominant minority-will is so obdurate as to induce a counter spirit of dominance on the opposite side. Then we have Bolshevism, the seed of which is always sown and nurtured by its bitterest foes.

On the other hand no open-minded observer, certainly no educator, can fail to be struck with the wonderful way in which men normally respond to the institutional systems within which they grow. There is a most significant contrast between the enduring, and often too rigid, framework of institution and custom on the one hand

PREFACE

IX and on the other the responsive spirit of each fresh generation before it in turn takes on the cast of time. Change the system, and beyond doubt you change also the thoughts of men. Wherever it is practicable to remold the system to express a new ideal, it is certain that you thereby perpetuate that ideal. Now a world-earthquake has shaken the social system, including also the economic order. The forces allied to the old order are already at work to restore and to confirm it. Those who believe in a new order must seize the perhaps brief time of opportunity. They must proclaim alike an ideal and a practicable way of its attainment.

The root of industrial evil is the present wage-system. The ideal towards which we must strive is some more cooperative order of production within which there at length remains, as we now understand these terms, neither "capitalism" nor "wagery," neither wanton upliftedness nor hazardous dependence, neither prodigal waste nor sheer degrading poverty. Thus roughly stated, the ideal doubtless suggests revolution. All ideals do, or else they remain forever ideals. But revolution as a result and not a means, revolution as x PREFACE

the significance of a new order duly established by intelligent process, not the blind catastrophe of despair. Perhaps fate offers us finally the choice between these two.

There is a temper of revolution which is but the other side of the seal of tyranny. From such no new order can arise, only a grotesque reversal of established dominance. There is also a temper of revolution which, with no less prophetic a vision of the end to be attained, would yet build in patient determination, rejecting no stone that may be fitted into the new edifice. From such alone can a new order proceed.

What is to be feared for America is that the apathy of the majority and the narrow domination of a plutocracy owning unprecedented power may, while repressing the constructive spirit, provoke yet further in the subject ranks of labor the spirit of anarchy and overthrow. This would be countered by an increasing conservatism in the rest of the community, including the superior ranks of labor. Thus America, which already, for all its magnificent opportunities, is laggard in the movement of industrial progress, may prove that nowhere is it so hard to change an old order as in a new world.

Contents

CHAPTER PAGE

Preface v

I. The Economic Foundations and the

Chapter I The Economic Foundations And The Shaken Superstructure

The assault of new ideas. The position of the State: the new limits to its sovereign power. The transformation of the economic order. The significance of "labor unrest! }

The foundation of economic order in the increasing necessity of cooperative production. Importance in this connection of the growth of productivity as compared with population. The alternative channels of the energy and resources so liberated.

It is the law of nature, for nations and for men, that they pass through the crumbling stages of past life to new experiences. These they must receive or they inevitably decay. There are periods of secretion and gestation and also of travail and birth; periods of quiescence and also of struggle; periods of slow growth and also of violent transition. It is our fortune to live in the disturbing days of great changes, fulfilled and impending, in a time of national travail and of new deliverance. The war, it is said, has shaken society to its foundations, — to its foundations, yes, but the foundations themselves remain. The superstructure is shaken, but the foundations are in the heart of humanity; and, while that endures, while men hunger and thirst, while they love and fear, while their wants and strivings can be satisfied only by obedience to the abiding laws both of their own nature and of the outer world, the bases of society endure.

I am not advocating the hoary fallacy that human nature does not change. Man changes all things else upon the earth because he changes himself first. He builds new worlds because he is himself different. He widens the bounds of society because his own mind is widened. He masters the forces of nature because his own in* telligent force has grown. But, though social forms and institutions pass away, the ties which bind men in society are not thereby broken. Men remain dependent upon one another; rather, they grow more dependent on one another. The common welfare grows more, not less, real; more, not less, insistent. The foundations of society can never fail while the truth stands that the essential needs of men are best or alone fulfilled in the mutuality and cooperation.

The foundations remain, but the superstructure of institution is badly shaken. There is scarcely a social institution that the storm of war has left wholly unscathed. Some will soon be repaired, but others must be rebuilt. These last, though bulwarked by custom, had been weakened by the continued assault of new ideas, by the growing urgency of conscious needs seeking a satisfaction these failed to give. The war broke the seals of custom and thereby gave potency to the attacking forces.

For in these days of history-making it is well to remind ourselves that the only thing that does make history is a change in men's ideas. Finally, it is not wars or conquests, not King or Emperor or President, it is the ideas which they represent or incarnate, the ideas which they stimulate or repress, that change the face of the world. Actions fade into memories, but ideas live as long as there is a brain to think them. Over them alone time has no sway, but it is they that give time its meaning. We divide them into epochs because of the changing thoughts of men. Actions are circumscribed by the hour and the place. Ideas are winged and seek all over the earth for the receptive soil; just as the germ mysteriously appears where its appropriate breeding place is prepared, so wherever the spiritual soil is favorable the idea finds its way. It waits patiently for the hour and the place that it may strike root, and there it grows and fructifies and can be extruded only by the presence of another and more potent idea. An old Scottish theologian used to speak of the "expulsive power of a new affection." The phrase may be applied to ideas. No force, no medicine, nothing but the expulsive power of a new idea can drive out that vital germ from the mind of man.

The war confounded the general sense of security which exists in an ordered society, disturbed that complacency which the more fortunate wrap around them as a garment, and still more completely dissipated that spirit of acquiescence which the less fortunate acquire as part of their adjustment to life's conditions. The ferment of ideas is more advanced in the older lands, but it inevitably spreads, as do most socio-economic movements, from east to west. It is well, therefore, that we should ask ourselves, with special reference to the labor situation, just what has been shaken and what remains as solid rock.

First, the position and power of the State itself has been subject to the assault of new questionings. Never in history has the State been so supreme, so absolute, as it became under the necessity of war. Never did it enter so intimately and so irresistibly into the life of every individual, assigning to millions the issues of life and of death, prescribing what men shall work at, what they shall eat, what they shall wear, even what they shall think. In earlier times the theory of absolutism went further, but it required the modern centralized mechanism of production, it required the modern press, it required the network of railway, telegraph and telephone, to arm the central political authority with swift and universal dominion over the lives of men. And yet underneath there were forces at work which were preparing to challenge as never before the old principle of State-sovereignty. While the menace of autocracy was being thrust down, democracy itself in its historic significance was insecure and full of doubt. The struggle for democracy had been, historically, a struggle for the liberty of representative parliaments. The struggle seemed over, the liberty achieved, and men felt a curious dissatisfaction with the result. Consider the mother of parliaments herself. It was only in 191 1 (when the veto of the Lords was broken) that the last stage of its emancipation was complete, the end of an age-long struggle. And yet when the war was over and the time came to elect a parliament that, constitutionally, must decide the most fateful questions ever submitted to any body of men, most observers recorded an unwonted indifference on the part of the electorate. Many felt that it was not there, or by these representatives, that the fate of the world would be decided. Within the nation there had grown up other powers, great new associations that the political sovereign had perforce to recognize. With the most formidable of these powers, the opposing forces of capital and of labor, the English parliament, all-powerful in name, omnicompetent by constitution, has been compelled to treat, as one power with others, ostensibly acting as mediator, but doing so not of choice but of necessity. The State is no longer Leviathan, supreme and alone. It is one collectivity among others. It finds new and strange limits to its power.

In the international situation another change of the political structure is being prepared. Federation of peoples, which nearly all men regard as desirable in some form, cannot be attained without a surrender of a part of the old sovereignty of the individual state. Besides the national parliament there may arise the international parliament. It is well to recognize that this would profoundly affect the currents of national life, that it would mean the stimulation of new ideas, that it would mean in particular a further and progressive revision of the idea of political sovereignty. It would create new problems for democracy, showing that the mere achievement of full parliamentary institutions, far from being the final solution of the problem of liberty and order, was but the first step on a long journey of peril and of hope.

Enough may have been said to explain the statement that the political structure has been shaken by the power of new ideas. Much that once seemed sure has grown uncertain, much that once men accepted as cardinal political principle is questioned. Those who look for finality in human institutions must journey elsewhere on their fruitless quest. I turn next to the economic structure, the true storm-center of the struggle.

The present economic system is often described as a competitive one. The description has long ceased to be accurate, if it ever was. In reality the present system is the unstable resultant of two opposing sets of forces, the competitive and the anti-competitive, and the latter has been gaining ground at the expense of the former. This is revealed very markedly in three ways : in the growing control of the state over economic conditions, ranging from actual ownership to such legal determinations as Factory Acts ensure; secondly, in the vast modern organization of capital, by means of amalgamations, trusts, cartels, selling agreements, interlocking directorates, associations of manufacturers, associations of agricultural producers, alliance of banks with trust companies and industrial corporations, and so forth; and, thirdly, in the extension of unionism among the workers. The semi-automatism of the competitive system is being in part superseded by the conscious effort of these three great forces to gain or retain control of the productive process, and, perhaps still more, by the struggle between the two latter, capital and labor, to obtain the greater share of the product and in the effort to use the machinery of the state.

While these mighty contests are straining the whole industrial fabric, the strife is gradually concentrating around the wage-system. Here is the real significance of what we call labor unrest. As it grows self-conscious it proves to be nothing less than an ever more resolute attack upon a system. We shall go far astray if we think that praise or condemnation, of either side, has any relevance to the situation. The worker, if he changed places with the employer, would be overpersuaded by the system even as the employer is; the employer, if he changed places with the worker, would likewise learn the bitterness and inertia io LABOR IN THE CHANGING WORLD

of wage-earning. Employers and workers alike are bound up in a system which neither has created, but naturally the attack comes from the side which suffers from it most. Labor unrest witnesses to a deep-rooted evil. It springs from poverty, hazard and privation, but still more from the sense of exploitation and the frustration of opportunity — for all of which it accuses the wage-system. Labor unrest is not something to be exorcised, it is not even something to be feared. It is part of what distinguishes the human being from the sheep. It is inevitable in a civilization which leaves from twenty to forty per cent of the industrial population in a state of sheer destitution, and which concentrates, as in Great Britain, two-thirds of the total wealth of the country in the hands of one-seventieth of its population, or, as in America, the same proportion in the hands of one-fiftieth of the population. It is part of the eternal striving of humanity for a better and fuller life, fraught no doubt with all the difficulty and aberration, but also with all the necessity which accompanies every process of growth. The unrest of to-day makes the civilization of to-morrow. Had there been no unrest in

THE ECONOMIC FOUNDATIONS u

the stone age, the world would be still in the stone age.

It is our duty to understand this momentous uprising, to examine it with clear and fearless eyes, to search beyond symptoms for causes. Let us not think of it as a mere troubler of the peace. It exists because there is no peace. Let us not dismiss it as agitation, as disturbance of the established order. It exists because there is deepseated disorder. We should no more meet it with reproval and indictment than a physician reproaches or indicts a disease. We should no more seek to remove it by vain palliatives or vainer incantations than a physician seeks thus to remove the causes of disease. If those of us who are not in the ranks of labor do not go out with sympathy and understanding to apprehend the human meaning of these discontents, we are but helping to give them narrower, more bitter, and more explosive character. Blindness is always the counterpart of revolution.

A great new consciousness of need has arisen within the present system of industry. It is in part the product of education, and in part the product of machinery. For education, the educatlon fostered by experience rather than by the schools, has brought a greater consciousness at once of dignity, of power, and of possibility. It teaches men to refuse the position of being a commodity, to be bought and sold without regard for the human costs of the buying and selling. When once that degradation becomes conscious, it ceases to be long tolerable, and the days of any system which makes it necessary are numbered. Machinery was in a measure the means of that degradation. Machinery massed men and depersonalized their work. It destroyed the old craftsmanship — the intimate relation of the worker to the integral product of his hands. Machinery is man's great agent of deliverance from the drudgery of life, but it offers deliverance at a price. The price is the loss of the specialized skill known as craftsmanship. Machinery breaks down the barriers between crafts. It does not destroy skill but it generalizes it. It specializes function and generalizes skill. It has destroyed the mystery, the exclusiveness, and the privilege of the old crafts. No longer can the workman find in his specialized function the living interest which a men seeks in his work. He must now gain less narrow interests, even as his skill is less narrow. He must share in the interest of the whole process of production of which his work is a fragment. He must consciously cooperate in production, as one who is a partner in production. The absence of this spirit of cooperation is the final indictment of the present breaking system, and there will be no peace until that spirit is regained. Ask almost any employer, and he will tell you that the workmen have no interest in their work. Lord Leverhulme, for example, declares that the present system turns the workers into a race of ca'canny shirkers and slackers. What can you expect? Has it not always been true that the hireling flees because he is a hireling?

The loss is twofold, in the effect upon character and in the effect upon productivity. When men lose interest in their work they lose the sense of responsibility. Much of the energy of life is lost, and much is misdirected. The demand for mere excitement witnesses to the loss of a more central interest. Because men fail to find interest in their work they pursue the spurious excitations of sensationalism, to the provision of which all social institutions, but especially the press, the picture house, and the pulpit, may be perverted. The balked intrinsic desire, the natural desire of men to fulfill themselves in their work, issues in a restless craving for extrinsic and unsatisfying stimulation. On the other hand, there is the direct economic loss. Is it not a curious commentary on our economic order that the great mass of those who produce should take pains to lower their own productivity? While in all other things men seek to be efficient, here they seek not uncommonly to be inefficient. The sense of opposing interests means, here as elsewhere, inefficiency; the sense of a common cause alone brings cooperation, and therefore efficiency. But in industry in general there is cleavage, not cooperation, and therefore inefficiency. The general conclusion is clear. A way of cooperation, of partnership, must be found which will unite all producers in the work of production, making it the common interest of them all, so that men cease to feel as the helots and hirelings of their fellowmen. All significant schemes of industrial reconstruction, such as that of the Whitley Committee in Great Britain, are directed to the attainment of this end. They recognize the necessity for a new order, a more representative order, a more cooperative order. This cannot be attained without changes of great importance in the economic superstructure of society.

II

The economic foundations are secure. Every advance of society, every discovery, every application of science, make the foundations more secure. For they make men more dependent upon one another over greater areas of community. Already not one of us but employs unwittingly the hands and brains of countless thousands of his fellowmen. Carlyle prophetically saw it when he declared that not an Indian could quarrel with his squaw but the world must smart for it — the price of beaver would rise! That hyperbole grows in fact more true with every advance of science, for science destroys isolation and establishes interdependence. The history of man is in one aspect the history of the growth of an organization which diversifies the work of each, making each more dependent on others in order that by the surrender of self-sufficiency he may receive back a thousandfold in fullness of life. It is becoming true between nations as between men. The world knows to-day that a nation cannot injure another without doing grave injury to itself. What it has yet to learn is the happier counterpart of that truth, that a nation cannot serve itself, cannot honestly prosper, without benefiting other nations also.

Cooperation is more fruitful than conflict. Man works to satisfy his need, and seeks to do so in the most economical way. He therefore chooses more and more the method of cooperation. Economy and society go hand in hand. Where there is no society there is waste. Where there is social dissension there is waste. The greatest waste in the modern world, from the economic standpoint, exceeding even the waste of the warfare between nations, is that of the warfare between Labor and Capital. If that seems a hard saying, it is because we have not realized the extraordinary wastefulness of industrial disharmony — the waste of unemployment, the waste of labor turnover, above all the waste of unwilling task work. This warfare will never be ended, it will almost certainly grow worse, until labor ceases to be mere labor and capital to be mere capital. This means equality of opportunity, so that neither status nor accumulated wealth, but natural endowment and quality shall determine leadership in industry. It means security against exploitation, so that none shall grow rich out of the poverty of others. It means assurance of employment, so that none who have the will and capacity to work shall seek for it in vain. It means a more representative system of industry, so that all who share in its toil shall have the right to express their needs through an orderly constitution. It means industrial citizenship, so that no class shall be without a voice in the determination of its fate. Let us clearly understand that the alternative to these conditions is no longer, in the present temper of our civilization, the retention of the present system — it is the ferment of revolution, and revolution can gain, by whatever violence and disturbance, no other ends than these. It may attempt more, but it cannot obtain more. Any economic order whatever must rest on the economic foundations of society. Men must finally adopt the system which is in the widest sense most economical, the system which, with the least expenditure, produces most of what men require to satisfy their.

needs. Neither the selfishness of the few nor the tyranny of the many can long defeat the lesson of experience. Because cooperation is in the long run most economical, men must in the long run resort to cooperation. They must, whether they desire it or not, obtain their individual ends through economic solidarity.

There was only one lion in the path which could have made this progress impossible. The most formidable question, within the economic sphere, which any man has ever asked, was that raised by Malthus. Malthus raised the question of productivity versus population. He held that there was a constant tendency for population to outrun productivity. The increase of mankind was naturally more rapid than the increase of the means of life. If this were true, then men must always be subject, in the absence of a prudential control which Malthus thought desirable but rare, to endless conflict, and the economy of cooperation could never be established. But the period that has elapsed since the works of Malthus first disturbed the optimism of the early nineteenth century has witnessed developments which have removed that terror and implanted, in the more fearful-minded, another of a very different kind. Falling birth-rate and falling death-rate, in all civilized countries, witness to profound changes in the social order. Into the significance of these changes we cannot here enter. It must suffice to state the conclusion, which many facts and figures could be brought forward to substantiate, that there is now every reason to believe that productivity is advancing more rapidly than population. The period of war was a sad exception and yet the unheard-of economic waste of that period, while yet the general standard of living suffered comparatively little, furnished a remarkable proof of the general truth. In all civilized communities there is created in every normal year a surplus of production over consumption, a surplus which, as increased capital, can be made to enhance continually the general standard of economic prosperity.

This is a fact of immense significance. It opens up a prospect full of hope. It points to a time, in the quite near future, when a recognized minimum of material comfort shall eliminate the sordid destitution in which multitudes are living today. The philosopher Godwin held the view that in the truly scientific age half an hour's work a day would suffice for the satisfaction of material needs. We may think such a statement absurd and Utopian, but it is worth while reflecting that probably some such minute fraction of modern industrial activity is in many directions as productive as the whole weary day of work which our ancestors of not many generations back endured. The spindles of Lancashire to-day produce as much as would have required the services of two hundred million men unaided by machinery. Of course needs grow with the power of satisfying them. Need is the hydra which whenever one head is cut away grows two new ones in its place. If it were not so, there would be in the world to-day no poverty and little wealth.

Let me dwell for a little on this hydra character of human needs. It has an important application. When an original need is satisfied, two new possibilities of satisfaction are revealed. When, for instance, men have provided for their need of food their former desire may go out towards a finer diet, not more food but different, or it may be diverted into some different channel altogether. When all the primary organic needs of men are satisfied, men may either refine on these, seeking their more luxurious fulfillment, or they may pass to the satisfaction of what we may call higher needs, cultural needs. Usually, of course, both directions are pursued together, and the character of a civilization is defined by the degree of stress it lays upon one or the other, Capua went one way and Jerusalem another; Florence went one way and New York another. In every case the foundation is the economic one, the satisfaction of the primary needs. In Aristotelian terms, there must be life before there can be the good life — or the luxurious life. Man is economist before he is either stoic or epicurean. Hence, man's increasing productivity, his increasing control over the material environment, opens out two great avenues of life. Being liberated from the pressure of organic necessities, he may be carried by the very momentum of the previous effort to satisfy these into the ever more intensive pursuit of their endless varieties of refinement. If he follows that way, and that alone, his liberation is illusory. As the power of satisfaction grows, custom and habit turn into necessity what was formerly otiosity. The pressure of necessity is restored, with the difference that a hundred necessities have taken the place of a few. I do not mean to imply that the refinement of organic needs is not itself a process of great cultural significance, but only that the complete engrossment in these prevents that greater liberation of the spirit which the enjoyment of intrinsic interests can bestow. This is the other great avenue which man's economic mastery prepares. Here is the greater emancipation, in the spirit of free devotion to ends in themselves worth while, in the pride not of possession but of the quality of life, in the satisfaction of workmanship and art, in the understanding of men and in the appreciation of nature, in the sense of fruition through the exercise of all man's faculties. These are the treasures laid up in heaven which thieves never break through to steal, for taking does not impoverish nor does withholding enrich. This is the living bread which can be distributed among the multitudes and grows the more it is divided.