The strength and weakness of socialism

Front matter

•ECONO COPY, I8«t.

Chap. Copyright No.

Shelf..HX-l(5

Part I. The Nature Of Socialism. Chapter

I. Socialism in a more General Sense Distinguished

from Socialism in a Narrower Sense 3

II. The Elements of Socialism 9

III. Definitions of Socialism 19

IV. The Socialistic State 29

V Some Misapprehensions Concerning the Nature of

Socialism 37

VI. The Origin of Socialism 50

VII. The Progress of Socialism 56

VIII. The Evidences of an Alleged Irresistible Current of

Socialism 73

IX. Socialism Contrasted with other Schemes of Industrial Change , 85

X. The Literature of Socialism 96

Part II. The Strength Of Socialism. Chapter

I. Introductory Remarks 113

II. The Strength of Socialism as a Scheme of Production 116

III. The Strength of Socialism as a Scheme for the Dis-

tribution and Consumption of Wealth 138

IV. The Moral Strength of Socialism 145

V. Socialism as a Promoter of Art 157

VI. Socialism and Present Problems 162

VII. Services which the Agitation of Socialism has Rendered 166

Part III. The Weakness Of Socialism. Chapter Paqb

I. Introductory 175

II. Alleged, but not Valid, Objections to Socialism . . 181

III. Socialism too Optimistic with Respect to the Future,

and too Pessimistic with Respect to the Present . . 188

IV. The Danger of the Domination of a Single Industrial

Principle, and of the Inevitable Concentration of

Dissatisfaction under Socialism 197

V. Socialism a Menace to Liberty 206

VI. Objections to Socialism as a Scheme of Production . 215 VII. Objections to Socialism as a Scheme of Distribution

and of Consumption 233

VIII. Other Objections to Socialism 244

Appendix

Suggestions for Social Reform . . 253

Part I. The Nature Of Socialism

SOCIALISM AND SOCIAL REFORM.

Chapter I

SOCIALISM IN A MORE GENERAL SENSE DISTINGUISHED FROM SOCIALISM IN A NARROWER SENSE.

The word socialism, which has come into use in the present century, has already acquired a variety of meanings. It seems necessary to any clear thought that we should, first of all, distinguish between socialism in a large but not altogether vague sense, and socialism in a more technicpJ and more precise sense. Socialism in this large sense frequently has reference, in a general way, to the views and aspirations of those who hold that the individual should subordinate himself to society, maintaining that thus alone can the welfare of all be secured. Socialism in this more general sense implies the rejection of the doctrine of selfishness as a sufficient social force and the affirmation of altruism as a principle of social action. Socialism, in this broad sense of the word, means that society is not a mere aggregation of individuals, but a living, growing organism, the laws of which are something different from the laws of individual action. Aristotle was a socialist in this sense of the word, which, it may be remarked, is a true sense of the word ; for he maintained that you never could arrive at the whole by a mere addition of the units comprising it, and consequently that the welfare of society could not be secured through exclusive attention to individual claims. The prosperity of the whole, however, he maintained, implied the prosperity of all the individuals which it includes. In other words, this sage of antiquity thought we must proceed in our treatment of social questions from the standpoint of society, and not from that of the individual.

** The state is, by nature," says Aristotle,^ '' clearly prior to the individual and to the family, since the whole is of necessity prior to the part. . . . The proof that the state is a creation of nature, and prior to the individual, is that the individual, when isolated, is not self-sufficing ; and therefore he is like a part in relation to the whole. But he who is unable to live in society, or who has no need because he is sufficient for himself, must be either a beast or a god."

The great thinkers in economics and politics in all ages have been socialists in this general sense of the word, and opposed to them has been a small sect of individualists, who reject the conception of the state as an organism, and believe that the standpoint of the individual is sufficient, both in science and in practice. Two definitions of socialism, as here understood, may be helpful to the reader. The first is taken from an address on Socialism by Dr. Westcott, the present bishop of Durham. It is used to describe, as the author says, not merely a theory of economics, but a theory of life, and is given in the following words : —

** Individualism regards humanity as made up of disconnected or warring atoms. Socialism regards it as an organic whole. . . . The aim of socialism is the fulfilment of service ; the aim of individualism is the attainment of some personal advantage — riches, place, or fame. Socialism seeks such an organization of life as shall secure for every one the most complete development of hie

1 Aristotle's Politics, Book I., 2, §§ 12-14.

SOCIALISM IN A MORE GENERAL SENSE, b

powers ; individualism seeks primarily the satisfaction of the particular wants of each one, in the hope that the piu*suit of private interests will, in the end, secure public welfare."

And further on in the same address Dr. Westcott asserts that "the goal of human endeavor is the common well-being of all alike, sought through conditions which provide for the fullest culture of each man as opposed to the special development of a race or a class, by the sacrifice of others in slavery or serfdom, or necessary subjection ; '^ and he speaks of this as the central idea of socialism. He maintains, however, that " it does not follow that the end can be reached only in one way.''

Socialism is then not restricted necessarily to state activity, but it becomes equivalent to affectionate regard for others in society, and the systematic attempt to improve others. It is used as the opposite of individualism, which then means a selfish and inconsiderate exaltation of the individual.

The second definition of socialism to which reference is made, is that given by Prof. Adolph Wagner, the celebrated professor of political economy in the University of Berlin. Defining socialism in a more general sense as the opposite of individualism, he says : —

** It is, therefore, a principle which regulates social and economic life according to the needs of society as a whole, or which makes provision for the satisfaction of those needs, whereas, individualism is a principle which, in social and economic life, places the individual in the foreground, takes the individual as a starting-point, and makes his interests and wishes the rule for society.''

The use of the word socialism in the large sense just described is a legitimate one, for it serves to designate a class of thinkers, and to distinguish them from those who hold very different views. Socialism and individualism are two different philosophical systems. The only objection to the use of the word socialism to designate that social philosophy which is contrasted with individualism in the broadest sense, is that socialism has a narrower meaning, to be described presently, which has become prevalent. Thus, if a writer declares, "I am a socialist ! " he is more likely to be classed with Karl Marx than with Aristotle.

The word socialism has, however, other general uses which seem to be altogether wanting in any scientific precision of meaning, and which should therefore be rejected. It is employed to designate in such a vague manner a tendency or attitude of mind, that it lacks all metes and bounds. It has, for example, even been used to designate the thoughts and efforts of those who concern themselves with social affairs. Manifestly, in this sense, it would include a large amount of the individualistic as well as the socialistic philosophy. One writer^ has called socialism the economic philosophy of the suffering classes. Doubtless he himself would not claim for this statement the character of a scientific definition; for socialism is not the only economic philosophy which has been or may be embraced by those spoken of as the suffering classes. We might likewise call anarchy, or voluntary co-operation, or Mr. Henry George's single tax, the economic philosophy of the suffering classes. The radical improvement of the lot of the propertyless majority has been declared to be the material content of socialism. In addition to the objections already urged to the previous statement, it may be said that it is not necessary to view socialism as a class problem, although it must be 1 Dr. von Scheel.

SOCIALISM IN A MOllE GENERAL SENSE, 7

admitted that it is so viewed by most social democrats in Germany. Socialism may be advocated by an artist from the artistic standpoint, or by a theologian from a religious standpoint. The true aim of the best socialism, it seems to the writer, is that general social amelioration which proposes to sacrifice no class, but to improve and elevate all classes. It does not necessarily mean the abolition of classes, although under any system of socialism other class distinctions would prevail than those which now obtain.

While each honest and careful definition of socialism tells us something, there is a whole class of definitions which must be simply rejected as dishonest.

For example, when one says that socialism is that system which swallows up individual liberty, subordinating entirely the individual to society, it is plain that the so-called definition is no definition, but a condemnation of that which is to be defined. Then there are certain popular and inaccurate ideas which need not occupy our time. There are those who call any general social upheaval and widespread turning things upside down, socialism, although this upheaval manifestly may be as well anti-socialistic as socialistic. Then there are those — and we meet them very commonly — who call whatever they regard as an exaggeration of the social principle, socialism, especially if it takes the form of state activity. Thus, whether the ordinary man calls the government ownership and management of the telegraph socialism or not, will depend upon whether he approves it or not. That kind of governmental activity which is not liked by any particular person is apt to be called by that person socialism. Manifestly we can make no progress in scientific discussion with such va«rue and unscientific ideas.

8 SOCIALISM AND SOCIAL llKFOiaL

The word socialism, as generally employed, has a far narrower meaning than socialism in the broad sense already described. It calls to mind an industrial society which, in its main features, is sufficiently clear and precise. It is not a theory which embraces all departments of social activity, but is confined to the economic department,^ dealing with others simply as connected Avith this and influenced by it. This socialism is frequently designated as " scientific socialism." It is with this socialism, which presents a theory of industrial society based upon radical social reconstruction, that the present work deals.

1 Cf. Prof. Anton Menger's work, Das Recht auf den vollen Arbeitsertrag, p. 2.

THE ELEMENTS OF SOCIALISM.

CHAPTER II. THE EliEMENTS OF SOCIALISM

Socialism, when analyzed, is found to embrace four main elements. The first of these is the common ownership of the material instruments of production. It is not stated precisely how this common ownership is to be brought about, or exactly what form it is to take. Opinions may and do differ about the practical steps which are to be taken to secure the desired end, and also about the nature of the collective organization in which this ownership is to be vested. But no one can be called a socialist in the modern technical sense who does not accept the doctrine of the common ownership of the material instruments of production. The collectivity, that is, society as a whole, is to take the place of individuals and private associations of individuals as owners of land and capital, in order that the advantages of ownership may accrue to the whole, and not merely to a part of the whole. The private receipt of rent and interest in the economic sense then ceases, for rent and interest are the remuneration of ownership.

It is not difficult to understand what this postulate of socialism, namely, the socialization of the material instruments of production, means. It is simply necessary to exercise one's imagination, and to picture to one's self the extension of that which already exists in a comparatively small way. The post-office in the United States is already socialized. It is owned by the people as a whole, and all share in many ways in the advantages of this common ownership. The telegraph in most countries is a part of the post-office, and it is owned by the collectivity. Kailways in many countries are public, not private property. Forests are to a considerable extent collective property. All these kinds of wealth are instruments of production ; and if that process which has made of these instruments collective property is continued until substantially all the land and all the capital have been socialized, we shall have realized the first demand of socialism.

It is said substantially all land and capital, because it is held that it is not necessary that the common ownership should be absolutely all-inclusive. It is a weakness of the extremists to insist on all — inclusiveness in common ownership, which much damages their cause. What is necessary is that the collective ownership should become dominant in such manner as to control all other ownership and confine it within narrow limits. All the great instruments of production, like telegraphs, telephones, railways, forests, arable lands, and large manufacturing plants, must become collective property; but socialism does not imply that it is necessary to restrict individuals in the acquisition of the instruments of production on a small scale, — for example, a wheelbarrow or a cart. Socialism, then, presented in the strongest form, does not proceed so much negatively as constructively. Society is to acquire the instruments of production ; but individuals, for the most part, are not to be restrained, except indirectly, by positive social action.

Emphasis has been laid by repetition upon the word material as qualification of the instruments of production. This means that man is excluded. For the socialist claims that under socialism man will, for the first time, become free. Man has, in times past, been owned as a slave, and the socialists claim that the wage-earner is even now a wage-slave, and their purpose is to free man.

Attention must be called, also, to the statement that it is the material instruments of production which are to be owned in common, and not all wealth. That wealth which is not designed for further production can still remain private property under socialism. This means wealth used for enjoyment rather than for production; for example, the furniture of one's house, family plate, heirlooms of all sorts, pictures, books, clothing, and many other forms of wealth which can easily be enumerated. The ground for the distinction becomes obvious enough on reflection. The design of socialism is the abolition of the private receipt of rent and interest. It desires to abolish private property only in so far as it enables one to gather an income through the toil of others without personal exertions ; for that the socialists call levying a tribute upon the labor of others.

The second element in socialism is the common management of production. Not only are the material instruments of production to be owned in common, but they are to be managed by the collectivity, in order that to the people as a whole may accrue all the beneflts of management; that is, all those gains of enterprise called profits, as distinguished from interest, and in order that the management may be conducted in accordance with the public need, rather than in accordance with the advantage of private captains of industry. Production is to be carried on to satisfy our wants for material tilings, and not for the sake of private profits. The distinction is undoubtedly a marked one. Production now ceases when those who manage it are unable to derive profits therefrom. This is a necessity under modern or capitalistic production; but under a socialistic regime, production is not stopped so long as wants clamor for satisfaction, and until all wants are satisfied there can, of course, be no real over-production. The distinction between common ownership and common management, that is, management by representatives of the people responsible to the people, is made clear in a moment by one or two simple illustrations. Eailways have been sometimes owned by the people in their collective capacity, and operated by a private company. There are those, indeed, who advocate common ownership of all the railways in the United States, with private operation. Land which is owned by the collectivity is frequently cultivated by private individuals. What socialism wants, then, is not merely common ownership, but also a common or collective management.

This common management of production means that the collectivity must furnish work for all who desire it. As the socialistic state assumes the charge of production, leaving only very minor functions to individuals, it rests upon it, of course, to make the industrial society all-inclusive. Indeed, the possibility of socialism once granted, there can be no difficulty about this. Every one is naturally assigned to some function which will make him socially useful; and the problem of the unemployed is inconceivable, as production is no longer conducted for exchange, but for consumption, and the greater the production the more ample will be the means for the satisfaction of all wants. Should it be possible at any moment to produce more than men really desire to consume, it would merely be necessar}^ to shorten the length of the working day. It would not only be true, however, tluit all could lind work, but all would have to work, as, with common ownership, the possibility of income without personal exertion would be cut off. How many could find employment in private service, it is not easy to say. Under socialism, we should expect a social organization of medical attendance and the supply of medicines, which would be simply carrying further tendencies already at work ; and }'et some might prefer to employ private physicians. Should the members of the socialistic society be willing to give part of their income in return for private medical services, there is no reason why they should be hindered in so doing. Similarly, religious services might be maintained by private contributions, and in the churches there could be large numbers of preachers outside of public employment. Possibly, also, room could be found for remunerative employment, of a private character, of a great many persons in the aggregate, who would concern themselves with the smaller branches of production. Yet, if socialism works as well as it is claimed it will, there would naturally be a preference, altogether apart from any compulsion, for public employment. We see that great public hospitals, at the present time, encroach somewhat on the individual practice of ])hysicians, and that public schools, in many, places, drive out private schools, although the law interposes no obstacles in the way of their success.

The tliird element is the distribution of income by the common authority ; that is, tlie income of society, or the national dividend, as it is frequently called : and it is that part of the wealth produced by society which may be used for enjoyment, after the material instruments of production have been maintained and suitably improved and extended. The common ownership and management of the material instruments of production necessarily results in ownership of the national dividend by the collectivity, in the first instance, just as now those who own and manage industry have the ownership of the products of industry, and from these products satisfy the claims of those who have participated in their production. It remains for the collectivity to distribute all the wealth produced for consumption among all the members of society.

^ As there is provision of work for all in the public service, so there must be provided an income for aD. But this provision of income for all reaches even further than the ranks of the toilers. There must always be in society some who are physically or mentally incapable of toil, and socialism contemplates the provision of an income for these also. The idea of socialism in this respect is that of mutual insurance. We are all insured from our birth against contingencies incapacitating us from earning a livelihood ; and provision is made for the satisfaction of our wants, even if we cannot render a personal return.

We are now brought face to face with what we may, perhaps, call the chief purpose of socialism ; namely, distributive justice. While socialists have desired to bring about a better industrial organization to increase wealth, and while they even lay emphasis upon the vast additions to the national dividend which, according to them, socialism would bring, it can scarcely be too much to say . that almost, if not quite invariably, considerations concerning justice in distribution have given them their initiative.

Yet what is justice in distribution ? While all agree that the present distribution is unjust, wide differences of opinion exist as to what is, after all, that justice in distribution which is to be the aim of the new society. A learned jurist, and at the same time an avowed socialist, claims that the socialistic schemes of distribution may be divided into two classes ; namely, distribution which aims to satisfy needs, and distribution which aims to accord to each one the full product of his toil. This would hardly seem to be sufficient to cover all socialistic plans of distribution, and perhaps it is better to approach the subject from a somewhat different standpoint. We can distinguish at least four schemes of distributive justice. One is the distribution which aims to secure absolute mechanical equality, that is, equality in quantity and kinds of goods. All must have food, clothing, shelter, education, and, in fact, all good things, so far as this is possible, in like quality and quantity. If distinctions in clothing are made foi age and sex, this is the most which can be tolerated.^ Emphasis is laid upon the equality to be carried out in all details — equality is the aim and end of this sort of distribution. A later idea of distributive justice is that which apportions reward to merit. It has been proposed that society should be organized in hierarchical form, and that in this hierarchically organized industrial society positions should be assigned according to capacity, the highest positions going to the greatest capacity ; and that reward should be in proportion to capacity. There could thus be room for quite as many gradations in

1 This was the view of Baboeuf. See tlie author's Frencli and German Socialism, where the other views of distribution are also described.

society as at present, but their basis would be personal, and not inherited rank or property.^ A still later idea of distributive justice is that which assigns the product in proportion to needs, recognizing the inequality of needs, while calling upon each one to render service in proportion to his strength of body and mind. Double strength, then, means double duty, but no greater claim on that account upon the national dividend; for the larger claim upon the national dividend must be based simply upon greater need.^ The fourth idea of distributive justice, and that which seems now to prevail generally among the more active socialists, is equality of income; not a mechanical equality, but an equality in value.

Each one, according to this idea, is to receive an equal value as his income ; but these values may be represented by goods and services the most diverse. There are those who claim that this last distribution accords both with the demand that distribution shall be according to needs, and that it should accord to each one the full product of his toil. Por they hold that equal values will enable every one to satisfy all rational needs, and that the services of all who participate in production, according to their strength have substantially equal value. But whatever idea in regard to distributive justice is once adopted, society is to carry it out.

The fourth element in socialism is private property in the larger proportion of income. It thus becomes at once apparent that modern socialism does not propose to abolish private property. Quite the contrary. Social ism maintains that private property is necessary for personal freedom and the full development of ouf facul-

1 This was the view of the St. Simonians.

2 Louis Blanc's idea of distributive justice.

ties. The advantages of private property are claimed by the advocates of the existing social order as arguments for its maintenance ; but socialism asserts that society, as at present constituted, is unable to secure to each one the private property which he requires. Socialism proposes to extend the institution of private property in such manner as to secure to each individual in society property in an annual income, which shall be, so far as practicable, sufficient to satisfy all rational wants, and to protect all from those attacks upon personal freedom which proceed from the dependence of man upon man. The instruments of production do not exist for their own sake, but for the sake of products for consumption, which again have as their destination man's needs. Now, while private property in the instruments of production is to be reduced to its lowest terms, it is to be extended and strengthened in the products for the sake of which the instruments exist. Attention must be called to the expression, ^^ the larger proportion of income.'' Income is derived from the use of property. Even at present the amount of j^roperty enjoyed in common is in the aggregate large. Public parks, public galleries, public schools, public highways, are illustrations which readily occur to one. All these institutions yield an income enjoyed freely by all in proportion to needs and capacities ; for income as just stated means use or enjoyment. We have at the present time in the United States, in these things, something which may be called true communism. Naturally, under socialism, as the thoughts of men would be more directed to the common welfare, and the inclination of men to enjoy things in common would be greatly strengthened, there would be a very large increase in the number of things

18 SOCIALISM AND SOCIAL IlEFOUM,

enjoyed in common, and thus yielding a common income. Public libraries would unquestionably be greatly increased ; and while no sane socialist would propose to prohibit private ownership of libraries, a great increase in public libraries might perhaps diminish the desire to have private libraries. Possibly the same would be true with regard to galleries of art and museums ; and it could not fail to be true with respect to grounds for pleasure and recreation. There would be thus a use of more things than at present in common ; and thus there would be an absolute increase, and probably also a relative increase, in the common income, and private income would be correspondingly diminished. There is a tendency, even at the present time, to increase very considerably the number and importance of those things that are enjoyed in common ; and socialism would simply carry further this tendency and accelerate it. Nevertheless, the greater proportion of the national dividend would, even as at present, still be private income.

CHAPTER III. DEFrNTTIONS OF SOCIAUSM

It is well to give especial attention to definitions in any subject tliat belongs to moral or political philosophy, because definitions give us the central ideas of their authors. A few significant definitions of socialism, in the narrow sense with which this work is concerned, will be given in the present chapter, in order, on the one hand, that the reader may contrast these definitions with the analysis of socialism given in the preceding chapter ; and on the other, that he may, by comparison, see the points most significant in the program of socialism as they present themselves to the minds of different persons.

First of all, the results of the analysis of socialism may be brought together in a definition which would read somewhat as follows : Socialism is that contemiila ted si/stem of industrial society ivhich proposes the aholition of private property in the great material instruments of production, and the substitution therefor of collective property; and advocates the collective management of production, together with the distribution of social income by society, and private property in the larger proportion of this social income.

Two of the most noteworthy writers on socialism who are not themselves socialists are Dr. Schaffle, whose works, " The Quintessence of Socialism " and " The Impossibility of Social Democracy/' have attracted so much attention, and Professor Adolph Wagner, who has so successfully attempted the utilization of the results of socialistic thought, without the acceptance of anything like its entire program. Both these writers have given definitions of socialism which well deserve attention. That of Dr. Schaffle is given in a description of the real aim of socialism, and reads as follows : —

'' To replace the system of private capital (that is, the speculative method of production, regulated on behalf of society only by the free competition of private enterprises), by a system of collective capital, that is by a method of production which would introduce a unified (social or 'collective') organization of national income on the basis of collective or common ownership of the means of production by all the members of the society. This collective method of production would remove the present competitive system, by placing under official administration such departments of production as can be managed collectively (socially or co-operatively), as well as the distribution among all of the common products of all, according to the amount and social utility of the productive labor of each.''