Cornell university Library 
 HN 31.C54 
 
 
 
 
 
 
THE LIBRARY 
 
 OF THE 
 
 NEW YORK STATE SCHOOL 
 
 OF 
 
 INDUSTRIAL AND. LABOR 
 
 RELATIONS 
 
 AT 
 CORNELL UNIVERSITY 
 
Library 
 
 The original of tliis book is in 
 tine Cornell University Library. 
 
 There are no known copyright restrictions in 
 the United States on the use of the text. 
 
 http://www.archive.org/details/cu31924002692253 
 
THE QUEST OF 
 INDUSTRIAL PEACE 
 
PREFACE 
 
 The chapters of this book are the record of an 
 inquiry into the elements of the ever-recurrent 
 industrial strife, and of their action and re- 
 action on each other. An analysis of the 
 contentions so decisively in conflict is followed 
 by a brief exposition of the chief social and 
 industrial adventures of the past. Then there 
 is a statement and a criticism of the theories 
 and proposals so eagerly advocated to-day. 
 An endeavour has been made to exhibit the 
 complex problems and the involved issues, 
 moral and psychological, economic and political, 
 which have foiled the enthusiastic idealists 
 of the past, and are preventing the assent of 
 the more thoughtful minds of the present day. 
 The two closing chapters engross a message 
 and a method, stated in the briefest possible 
 way, which seem to the writer to point out the 
 only path of industrial peace for those who 
 are sincerely willing to seek it. 
 
 The basis of these chapters was a Course of 
 Lectures delivered to the students of the 
 
vi THE QUEST OF INDUSTRIAL PEACE 
 
 General Assembly's College in Belfast. The 
 writer desires to express his sense of the honour 
 conferred upon him, and his thanks to the 
 Committee, and especially the convener, the 
 Rev. A. F. Moody, B.D., of Belfast, for an 
 exceeding courtesy, and to record also his 
 indebtedness to the President and the Professors 
 of the College for their cordial reception and 
 generous appreciation. 
 
 Glasgow, May 1921. 
 
CONTENTS 
 
 I 
 
 THE ELEMENTS OF THE INDUSTRIAL STRIFE 
 
 PASE 
 
 A just and stable social order — ^The recurring conflict of 
 ideals — ^The elements in the present strife : (1) The 
 modern industrial development ; (2) The changed ideal 
 of the standard of life ; (3) The quickened social con- 
 science ; (4) The possession of political and economic 
 pov er — ^The determining dynamic .... 1 
 
 II 
 
 THE ECONOMIC JUSTIFICATION OF CAPITALISM 
 
 Capitalism and Collectivism — ^The historic emergence of 
 Capitalism — Its economic justification in (1) The pro- 
 duction of wealth ; (2) The development of efficiency ; 
 
 (3) The power to meet the complex modern civilisation ; 
 
 (4) The conservation of the family — Private property 
 
 the basis of a wise economic order .... 22 
 
 III 
 
 THE MORAL VALUES OF CAPITALISM 
 
 The term ' capitalist' — Capitalism and its moral imperatives : 
 (1) A personal liberty ; (2) Sufficient and potent in- 
 centives ; (3) A disciplining individual responsibility ; 
 (4) The promotion of the higher interests of life . 39 
 
X THE QUEST OF INDUSTRIAL PEACE 
 
 MARXIAN SOCIALISM— (cimW.) 
 
 PAOS 
 
 Marx's four positions; (3) The class war— The crowd 
 consciousness — ^The response to the call to the class 
 war— The interests of the proletariat— The protest 
 against the giving of ' orders ' — The exploitation of 
 labour — The exploitation, by capital and labour, of 
 society — The two methods of the class war ; Evolution 
 and Revolution — The modem sympathy with violence, 
 and its political results ; (4) Marx's goal ; the dictator- 
 ship of the proletariat — The protest of Marxian 
 'Revisionists' — ^Its economic injustice — ^Its political 
 unwisdom — Its historic consummation in an autocratic 
 and wasteful tyranny 186 
 
 XI 
 
 ANARCHISM, SYNDICALISM AND GUILD SOCIALISM 
 
 The breakaway from Marx : (1) Anarchism and its Methods 
 — Propaganda by deed — Its distinctive apostle, Bakunin 
 — ^The two insuperable difficulties ; (2) Syndicalism — 
 Its ideal and early history — Sorel's conceptions — ' The 
 General Strike' — Its doctrinaire constitution — Its re- 
 cognition of the necessity for a renewed spirit; (3) 
 Guild Socialism — ^Its ideal and method — State ownership 
 — The unresolved impracticables — Its inner materialism 
 — Its social and political perils — Its denial of democracy 204 
 
 XII 
 
 THE NATIONALISATION OF INDUSTRY 
 
 Nationalisation and Socialisation — The seven suggested 
 spheres — ^The conditions of every possible Nationalisa- 
 tion : (1) The Postal Service ; (2) The Railway System 
 — Its economic waste and political peril; (3) The 
 
CONTENTS xi 
 
 PAGE 
 
 Miuiug Industry — It« uneconomic demand and its 
 methods of violence; (4) The Nationalisation of the 
 land — Laud not a commodity hut a tool — The initial 
 impediment to its Nationalisation — The ownership to 
 the cultivator — The historic judgment passed upon 
 Nationalisation .... ... 226 
 
 XIII 
 
 THE GATEWAY OF PEACE 
 
 The failure of the quest for Peace — Justice and mercy the 
 first necessities — The method of our supreme Teacher — 
 His values — His estimate of the place of wealth — His 
 attitude toward systems of industry — His demand for 
 regenerated character — Industrial peace and a changed 
 spirit — Apostolic counsels to industry — The historic 
 proof of the power of the Christian dynamic . . 246 
 
 XIV 
 
 AN INDUSTRIAL COVENANT 
 
 The modern trend to a covenant — The signs which favour 
 its adoption — Its four postulates : (1) The sphere of wage- 
 earning industry ; (2) The acceptance of Capitalism ; 
 (3) Co-operation of capital and labour; (4) Propor- 
 tionate reward — Its seven articles : (1) Equitable dis- 
 tribution ; (2) Labour the first charge on industry ; 
 (3) Then a fixed dividend to capital ; (4) The division 
 of surplus profit ; (6) The labourer also a capitalist ; 
 (6) Association in management and conduct ; (7) A 
 Board of Industry — The prospective results — ^The final 
 issues of righteousness, peace and joy .... 271 
 
THE ELEMENTS OF THE INDUSTRIAL STRIFE 
 
 An organised social order in which justice shall 
 reign and a stable peace prevail is an axiomatic 
 necessity of civilisation. To be just it must 
 attain the well-being of the community, and 
 give to every member of it the opportunity of 
 a free and joyous life. To be stable it must rest 
 upon the goodwill of the majority of those who 
 live under its shelter. Any autocracy or dic- 
 tatorship, either of a personality or a class, has 
 only one fate — ^to be overthrown. A secure and 
 beneficent human society must be based on a 
 ' social contract.' To determine its terms, to 
 adjust them to changing conditions, and to en- 
 force them, constitute the never-ceasing prob- 
 lem. As knowledge enlarges, tastes refine, and 
 moral imperatives become more sensitive and 
 more compelling, ideals change. Discontent 
 with the existing social order arises. This dis- 
 content finds expression in new demands, and 
 a conflict with the existing economic and 
 poUtical order is inevitable. 
 
 This discontent and strife are the ominous 
 features of our industrial life. The claims 
 
 A 
 
2 THE QUEST OF INDUSTRIAL PEACE 
 
 which are made assail the economic methods 
 and the political fabric. The first obligation 
 is to analyse the elements which are working 
 within this discontent. There is a call for an 
 inquiry, with a sympathetic interpretation, into 
 the wrongs against which protest is made. We 
 must distinguish between what is of reason and 
 what is of passion in these demands. There are 
 economic laws which cannot be wisely or safely 
 broken to satisfy any claim. There are ideals 
 which are the sentimental dreams of romantic 
 imaginations. Yet we must be fearless in 
 facing every demand, and adjusting the social 
 order to righteousness, offend whom that may. 
 We begin by passing in review these elements of 
 the industrial strife. 
 
 I 
 The first element is the economic and social 
 issues of the modern industrial development. In 
 the limited and undeveloped life of primitive 
 days human necessities were few and simple. 
 An intermittent and self-imposed exertion in 
 the untamed spaces of an ample world satisfied 
 the common wants. A small number of im- 
 written but clearly recognised distinctions be- 
 tween mine and thine formed the code of law. 
 A few customs and etiquettes regulated all 
 intercourse. But as men began to multiply 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 3 
 
 on the earth, to touch each other's lives more 
 closely, and deal with each other's possessions 
 more directly, great changes took place. The 
 desert was redeemed from its barrenness. 
 Populous cities were built. Life became not 
 only more intense, but more exigent of comfort 
 and of refinement, occupations more differenti- 
 ated, modes of subsistence more precarious. 
 The necessity of a more delicately articulated 
 industrial, economic, social, and political order 
 appeared. This necessity arrested the dis- 
 cerning thinkers of the intellectual Greek world, 
 and led Roman law-givers to their large-minded 
 jiirisprudence. Throughout the centuries it 
 has quickened both to thought and action many 
 of the noblest minds, and they have expressed 
 their ideals in those Utopias in which men would 
 dwell together in peace. In our own day young 
 men are seeing visions and old men are dreaming 
 dreams as they are pressed upon by the necessity 
 of adjusting the social and political order. 
 
 This long and slow-stepping change has be- 
 come overwhelmingly rapid in the last one 
 hundred and fifty years. Adam Smith's Wealth 
 of Nations, published in 1776, was the sober 
 and measured reasoning of a patient thinker 
 who stood on the threshold of this industrial 
 development, and looked forward with a 
 prophetic glance. He realised, with a clear 
 
4 THE QUEST OF INDUSTRIAL PEACE 
 
 prescience, what was coming in the industrial 
 and economic spheres. He laid down the 
 principles on which men must carry on a 
 world-wide commerce if the new possibilities 
 of attaining wealth were to be seized. Had 
 he always kept in view the companion truth, 
 that the most precious wealth of a nation is 
 the well-being of its men, women, and children, 
 he would have proved himself a prophet of a 
 wiser counsel. We need not set it down to 
 his discredit that, while he foresaw the far- 
 reaching potentialities of the economic forces, 
 he did not descry the social conditions of the 
 industrial development which had begun. He 
 was a man of his own age, and labour unrest, 
 as we know it, was not within his view. 
 
 A brief recapitulation will recall the marvels 
 of this century and a half of industrial develop- 
 ment. The lavish use of coal, and in later 
 days of oil and gas and electricity, to provide 
 power and transport has altered all produc- 
 tion. The manufacture and employment of 
 complicated and ingenious machinery, the lay- 
 ing down of a network of railways and tram- 
 ways, the building of fleets of ocean steamers, 
 have transformed both industrial and com- 
 mercial Hfe. They have brought the argosies 
 of the East in exchange for the manufactures 
 of the West. When we remember the work 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 5 
 
 of the inventor, the skill of the engineer in 
 harnessing the undirected forces of nature, the 
 discoveries of the chemist and metallurgist, 
 and the organising genius of the captains of 
 industry, we realise that labour has become the 
 slave of the dynamo, of the car, and of the 
 aeroplane. Men have attained, in actual ex- 
 perience, the possibilities of the swift flight of 
 Prince Housain's carpet. 
 
 But these industrial and economic elements 
 have had other results. These massed in- 
 dustrial forces have outclassed the country mill 
 and closed the village workshop. They have 
 built the factory and the foundry, have dredged 
 the rivers until the largest vessels pass into the 
 heart of great communities, and walled in the 
 docks which are the clearing-houses of every 
 manufacturing district. They have erected 
 the engineering works and spaced out the ship- 
 building yards where thousands pass the hours 
 of their day of toil. They have been squeezing 
 out the single trader, unable to carry on his 
 small business in competition with the prompter 
 dispatch, larger turnover, and lessened cost in 
 working of the multiple shop and the compre- 
 hensive establishment. As a consequence they 
 have built the city with its narrow streets, its 
 many-storied tenements, its densely populated 
 districts. The city of Plato's imagination was 
 
6 THE QUEST OF INDUSTRIAL PEACE 
 
 a clean, smokeless, and roomy little country 
 town. In the modem city this industrial 
 development has polluted the air, darkened the 
 light, contracted the number of the rooms in 
 the dwelling, and robbed the, children of even 
 a sight of the green fields. It has turned the 
 majority of men into wage-earners, enlarged 
 the number of the rich, and ministered to the 
 ease and pleasure of their lives. In that way 
 the disparity between the richer and the poorer 
 has been made more visible, and the conditions 
 of dependence and insecurity have haunted the 
 minds of the workers, and aroused, in some 
 quarters, a bitter resentment. 
 
 The picture must not be painted, as it is by 
 some hands, in unrelieved colours. This in- 
 dustrial development has lightened the burden 
 of daily toil, shortened the hours of labour, and 
 enlarged the common life. It has furnished the 
 weU-doing wage-earner's home, himg pictures 
 upon his walls, made his bed soft with comfort, 
 and given him a liberty in spending which he 
 would have considered a wasteful self-indul- 
 gence in earlier days. The destitution of half a 
 century ago is unknown, and legislation has 
 been called upon to make it impossible. The 
 word ' pauper ' has passed out of speech, not 
 only because of its stigma, but because there is 
 no need for its use. The artisan wage-earner 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 7 
 
 would be insulted if he were classed among ' the 
 poor.' If only those who receive a weekly wage 
 would disdain sloth and waste and improvi- 
 dence and drunkenness, not to speak of the 
 sadly prevalent vices of betting and gambling, 
 their social condition would be so advantaged 
 as to leave no ground for complaint except that 
 some other drinks out of a fuller cup.^ 
 
 Yet with all allowance it is abundantly clear 
 that the industrial development has issued in 
 wrongs which should be remedied. It has 
 created conditions which require amendment. 
 It has brought about disparities which provoke 
 men to revolt. It is evident that the labour 
 unrest and the consequent strife have been 
 aroused by these consequences, so evident in 
 every large industrial community, and that the 
 problem is one of restoring peace. 
 
 II 
 The second cause is the changed ideal of life. 
 That ideal can be broadly stated in the demand 
 for a fuller, freer, more leisured and larger life. 
 The industrial development has provided the 
 arena of the strife ; the changed ideal has 
 fashioned the demand and brought about the 
 
 ' A clear and fall account of the consequences of the industrial 
 development is to be found in The Town Labourer by J. L. and B. 
 Hammond with, however, too little recognition of the amount of 
 destitution due to waste, sloth and drunkenness. 
 
8 THE QUEST OF INDUSTRIAL PEACE 
 
 conflict. This demand is expressed in many 
 simple concrete forms. We hear it in the 
 claim for increased wages, shorter hours of 
 labour, a higher status for the manual worker, 
 and a larger share in the control of the in- 
 dustry. This demand, it must be noticed, is 
 the outcome of an educational advance. 
 Broadly speaking, every man to-day is edu- 
 cated when compared with the man of his class 
 half a century ago. In many countries there 
 were thousands who could neither read nor 
 write. Large numbers of the people seldom 
 thought of buying a book. Many did not see 
 a daily newspaper. The best informed had 
 only a little book-shelf with a few treasured 
 religious classics. To-day the whole world is 
 reading — ^something. The news sheet brings 
 the record of the world's doings to every man's 
 door. The trade journal makes him acquainted 
 with the technique and the commercial interests 
 of his occupation. The speaker at the public 
 meeting, the political pamphlet, and the dis- 
 cussion at the societies or unions, to which he 
 may belong, enlarge his knowledge, quicken his 
 imagination, and provoke his desire. 
 
 When this fact is kept in mind it will be seen 
 why the new ideal of the larger and fuller life 
 has been expressed in a claim for equality. 
 Through all the demands for higher wages, more 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 9 
 
 leisure, a better social status, and a larger share 
 in control, this thought of equality beats at the 
 very heart of them all. Of the three words of 
 the great political revolution— liberty, equality, 
 fraternity, each of which has its own appeal 
 — equality is the most potent to-day. But 
 equality is one of the most indefinite and least 
 explored of terms. It sometimes means merely 
 a political equality, which is an actual realisa- 
 tion, in so far as it can be expressed in statutes. 
 It sometimes means an equality of reward and 
 of possessions. Such an equality is impossible. 
 It is unjust. Equality may be a denial of 
 equity, and equality must never be attained at 
 the cost of justice. It is being realised that 
 the man who does the dirty, disagreeable, and 
 perilous work of the world should receive a 
 higher reward than the man who has some soft 
 and easy post. Equality would be unjust also 
 in the case where one man has spent years in 
 training himself for a specialised occupation, 
 while another has received a full reward as 
 soon as he could use a shovel. The man who 
 submits to a long training is entitled, as 
 Marshall declares, to ' deferred pay.' ^ 
 
 ' The Corn Law Rhyme of 1832 set this truth In an epigram : 
 
 'What is a Communist? One who has yearnings 
 For equal division of unequal earnings. 
 Blunderer, pilferer, or worse, he is willing 
 To put down his penny, and pocket my shilling. 
 
10 THE QUEST OF INDUSTRIAL PEACE 
 
 Sometimes this demand for equality means 
 equality of status. This equality is absolutely 
 impossible. No social order can distribute 
 status by enactment. The bit of work which 
 even an average man can do will never give 
 him the status which is attained by a master 
 in any branch of human endeavour. A teacher 
 who instructs pupils in the miJtiplication table 
 will never have the status— whatever he may 
 claim as his salary — of the man who is an 
 expert in natural philosophy. Status depends 
 on gifts and powers, on aptitudes and qualities, 
 which cannot be scheduled. There is only one 
 equality which can be recognised in a social 
 order without injustice. That is equality before 
 the law, which implies equality of opportimity. 
 No one can deny the absolute righteousness of 
 such equalities. The whole trend of legisla- 
 tion has been directed toward their attainment. 
 Any such inequality requires only to be pointed 
 out that it may be recognised and amended, if 
 it be an inequality before the law or in the 
 face of opportunity. The truth is that this 
 demand for equality is a protest rather than 
 a claim. It is a protest, because inequality 
 seems to conflict with the ideal of a full and free 
 and leisured life for all. It has led, in practical 
 issues, to a desire to pull all men down to a 
 common level. That desire has never been 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 11 
 
 translated into the terms of actual life. It 
 never can be so rendered. A Labour leader has 
 no intention, and even no pretence, of being on 
 an absolute equality with any one of the 
 thousand who make him their delegate at a 
 governing council. The claim for equality is 
 simply an unthinking expression of the demand 
 for a larger and fuller life. That is an ideal full 
 of guidance and of inspiration, but to pursue 
 it by the path of equality — except equality of 
 opportunity — ^is to walk in a land of bondage 
 and poverty and final disillusionment. 
 
 There are two remarks in regard to this 
 higher ideal of life which are in order. The 
 first is that the ideal has been too narrowly 
 conditioned by being confined to the sphere 
 of production. It is the equality of the man 
 as a laboiu-er, not of the man as a man. All 
 the legislation, so responsive to the hoarse cries 
 of the street comer, and aU the protests and 
 claims which are urged in the writings of those 
 who are moved by the thought of this larger 
 and fuller life, concern themselves with the man 
 who is a producer, and especially a producer 
 of the means of subsistence. Whenever we 
 lift our eyes and think of what a man is, even 
 in the things of this life, we leave behind us 
 this arithmetical conception of equality. We 
 rise to the thought that manhood should not 
 
12 THE QUEST OF INDUSTRIAL PEACE 
 
 be content with a law-made equality, but 
 should aspire to an excellence in the things 
 which are open to all. 
 
 The second remark is that the whole ideal 
 of a larger and fuller life is vitiated because it 
 is so completely materialistic. What Kant 
 condemned as 'the serpent's trail' of the 
 pursuit of earthly happiness, is over it all. It 
 seems to believe that a full and free and ample 
 life depends upon the delights that minister to 
 the senses. It seems to think that a man's life 
 consists in the abimdance of the things that he 
 possesses. It has not much more than a sneer 
 in some quarters for those aspirations and 
 delights which have evoked the highest and 
 purest energies of himianity. Mr. H. G. WeUs, 
 echoing many voices, writes with cheap scorn 
 of ' the consolations of the little Bethels.' He 
 implies that the working classes endured the 
 hardships of the Victorian era because their 
 minds and hearts were anodyned by the teach- 
 ing of their humble places of worship. Lenin 
 set this truth more insolently when he said that 
 ' religion is the opium of the poor.' But those 
 who sang the doxologies, as they still sing them 
 within worshipping walls, did not dream that 
 they required any consolations for having 
 missed the luxuries of the rich. They had 
 learned in whatsoever state they were to be 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 13 
 
 content. They knew that man does not live 
 by bread alone. They had east out all greed 
 and envy and hate. Their ideal of life was not 
 rendered into any claim for equality, or status, 
 or possessions.^ So that, what is wrong with 
 this new ideal of life is not that it is too high, 
 but not high enough. If it included all that a 
 man ought to be, and aU towards which he 
 should strain, it would rally to its reaUsation 
 many who reclaim against the materialism of 
 its desires. 
 
 ni 
 The third cause of the industrial strife is the 
 quickened social conscience. If the industrial 
 revolution provided the arena, and the higher 
 ideal was rendered into the demand, the 
 quickened social conscience has furnished the 
 dynamic. It is not sufl&ciently realised that 
 the ethical conceptions are the ruling motives 
 in this strife. In our day the social conscience 
 is quick and keen regarding the moral obliga- 
 tions of the individual to society, and of society 
 to the individual. The presence of men and 
 women who are well-bom and well-endowed in 
 the Labour Conferences is due to this qidckened 
 social consciousness. Its sense of obUgation 
 
 > Mrs. Beatrice Webb sets a truer aspect in her testimony to 
 'the debt which English Democracy owes to the magnificent 
 training given by Protestant Dissent in the art of self-government.' 
 
14 THE QUEST OF INDUSTRIAL PEACE 
 
 has become so sensitive that all public morality 
 is sometimes regarded as nothing more than 
 the service of man. Even professed Christian 
 teachers have been found to set down ' social 
 service ' as the most potent dynamic. 
 
 Now this quickening of the conscience is due 
 to the teaching of Jesus. There are writers 
 and speakers who make defiant and sometimes 
 abusive protest against indebtedness to the 
 Christian ideal. There are newspapers, and 
 even schools in which the Christian ethic, and 
 especially its spiritual basis, are scouted. But 
 the proof that the quickened social conscience, 
 which is condemning the wrongs of our in- 
 dustrial life, and inspiring the claims of the 
 manual workers, is due to the teaching of Jesus 
 is clear and conclusive. 
 
 For one thing, this industrial unrest and strife 
 are to be found only within Christendom, or on 
 its borders and fringes, where the influence of 
 the Christian moral ideal has been felt. There 
 is no Labour unrest among the industrial classes 
 of the untouched heathen races. Only when 
 they have been educated by Christian teachers, 
 and have reaUsed, often too dimly, the ideal of 
 manhood and womanhood as seen in Jesus, does 
 this discontent and unrest arise in their hearts. 
 In South Africa and in India, where Christian 
 missionaries have been at work, those whom 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 15 
 
 they have taught are rising up with the de- 
 mands of a higher ideal of life. These demands 
 are not always wise, and not always timely, 
 but they have been inspired by consciences 
 baptized into the mind of Christ. And those 
 who are willing to listen to them, and are wil- 
 ling to grant them in such proportion and in 
 such time as seem to be prudent, are all men 
 and women who have the social conscience 
 which is quickened by the teaching of Christ. 
 
 For another thing, there is the evidence in 
 the writings and speeches of the advocates of 
 the many forms of Socialism. It is a common, 
 and a just criticism, that none of these advo- 
 cates deal successfully with the proof of the 
 economic wisdom of the scheme they propound. 
 Few convince any one of the practicability of 
 the social system they outline. Fewer still 
 have been able even to visualise their panaceas 
 for our industrial strife. They cannot con- 
 vince each other that their new social order will 
 work. As a rule, the fatal flaw of all these 
 dreams is a reliance upon some Utopian or 
 even quixotic incentive. Some are bold 
 enough to declare that men and women can 
 be so inspired by the motive of service for the 
 nation, or the community, that they will con- 
 tinue to choose and to toil in the most straining 
 and nauseous occupations with a high abandon- 
 
16 THE QUEST OF INDUSTRIAL PEACE 
 
 ment of delight. Those who write or speak 
 in that way are not in contact with realities. 
 
 As a consequence they fall back from the eco- 
 nomic to the moral argument, and they appeal 
 to the quickened Christian social conscience. 
 They assert that whether this be practicable or 
 not, it ought to come to being. They argue 
 that the demand for higher wages, or more 
 leisure, or a better status, are not mere de- 
 mands for a bigger share, or for the means of 
 more indvdgent spending, but are dictated in 
 the court of conscience within. It is this 
 ethical ideal which feels the sense of wrong, 
 inspires the passionate conviction of the wiser 
 and nobler-minded leaders, gives to some phases 
 of SociaUsm an attractive charm, and makes it, 
 in some narrow and heated minds, their whole 
 religion. But the truth is that they are moved 
 by a conscience quickened by Christ. 
 
 For a third thing, there is the fact that many 
 who view labovir unrest with suspicion, and 
 have the conviction that many of its demands 
 are economically imreasonable and industrially 
 impracticable, are moved by a sense of ethical 
 obligation. They feel keenly the wrongs which 
 are bound up with the present social order. 
 They are smitten with self-reproach when they 
 look into the causes of industrial strife. The 
 same pressure of moral obligation, which has 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 17 
 
 made so many, who are unwilling to curtail 
 individual liberty, become keen advocates of 
 the prohibition of the liquor traffic, has led 
 them also to a deep sympathy with the ' under 
 dog ' in industry. They are willing to make 
 sacrifices, and even to suffer impoverishment, 
 if by any adjustment of the social organisation, 
 a ftdler life, an ampler leisure, and a more 
 abiding happiness could be attained as the 
 common lot of men. Whenever any proposal 
 can be proved to have potentialities for the 
 common good, and to be practicable, under the 
 inescapable conditions of life, it can be assured 
 of the tremendous dynamic of the social con- 
 science quickened by Christ. 
 
 IV 
 
 The fourth cause of the industrial strife is 
 the possession of political power. If the indus- 
 trial development has provided the arena, and 
 the new ideal of life has fashioned the demand, 
 and the quickened social conscience has fur- 
 nished the dynamic, the possession of political 
 power has given the weapon of attack. 
 
 Discontent is as old as Cain. His grievance 
 may be described as that of a lower status than 
 was given to Abel. There is a noble discontent 
 which is a pregnant source of man's upward 
 calling. But there is an ignoble discontent 
 
18 THE QUEST OF INDUSTRIAL PEACE 
 
 which may become a mean and degrading pas- 
 sion. Both in its higher and lower phases 
 discontent has played a great part in himian 
 history. Where it has been discontent with 
 oneself and one's service, it has been an im- 
 pulse toward a higher ideal. Where it has been 
 merely discontent, because of the disparity be- 
 tween the advantages enjoyed by one's neigh- 
 bour, and those enjoyed by oneself, it has been 
 a retarding passion. This latter discontent had 
 once no language but a cry, and no method 
 but a wild and reckless revolt. In England 
 Wat Tyler in one century, and Jack Cade in the 
 next, inspired by the teaching of Piers Plow- 
 man, resorted to force. Sadly and bitterly they 
 were taught that force is no remedy. To-day 
 there are some who are eager to adopt the same 
 rough handling of the social order. But a true 
 democracy is wiser. It beUeves in the govern- 
 ment of the people, for the people, and by the 
 people. It relies not upon force, but upon the 
 use of the weapon of political power. 
 
 Democracy and its methods require dis- 
 crimination before they can receive approval. 
 There may be a representative democracy, in 
 which those set in authority speak and act in 
 freedom. There may be a delegated democracy 
 in which the selected members merely register 
 their mandates. There may be a mob de- 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 19 
 
 mocracy, subject to gusts of sudden passion, 
 and ever and again echoing the cry * Crucify 
 Him, Crucify Him ! ' when some once popular 
 personaUty refuses to further their ambitions. 
 It is this mob democracy which speaks when 
 one of its writers declares, ' If those who have 
 held the power in the past believe that because 
 they have held it they must always do so, they 
 must be prepared for violent action to wrest 
 it from them. People will not be content with 
 merely political power— they will strive until 
 they acquire economic power.' That sentence 
 reveals the inwardness of the present strife 
 and prophesies one of its issues. A brood of 
 insurgent desires is being wilfully nourished and 
 the unthinking are being urged to violence. 
 The extremists among Trade Union leaders are 
 as authoritative as any autocrat, as self-willed 
 as any oligarchy. A Council of Action is 
 simply an oligarchy luider a new name. Be- 
 hind the declared purpose of the extremist to 
 remedy the wrongs of the manual worker there 
 lies, as is now seen, an eagerness to use in- 
 dustrial discontent as a means to overturn the 
 present political order by violence. The first 
 issue of such a policy, were it successful, would 
 be the enthronement of a pitiless bureaucracy. 
 Its ultimate realisation, as has been proved, is 
 the Russian Soviet. It is believed that the 
 
20 THE QUEST OF INDUSTRIAL PEACE 
 
 common sense of the people and the love of 
 f airplay will reject the methods of violence. It 
 is doubtless true that every nation will learn 
 in bitter experience that to mingle trade and 
 politics is harmful both to industry and the 
 State, and sets narrow bounds to the well- 
 being of men. We may trust the forecast 
 which declares that among the nations of 
 Christendom, and especially among those which 
 have wrought out an enfranchising poUtical 
 constitution there will not be a widespread re- 
 sort to organised violence and that the indus- 
 trial strife will be appeased by constitutional 
 methods, with an issue of a juster order and a 
 securer peace. 
 
 That conclusion is based upon the thesis that 
 of the four elements of industrial strife the 
 quickened social conscience will be dominant in 
 the end. Economic laws compel obedience to 
 their iron rule. Every ideal of hfe undergoes 
 the judgment of history. Violence may suc- 
 ceed in its first onset but it leads only to im- 
 poverishment and to a tyranny which is never 
 long endured. But no method of enforcing a 
 demand can find a steadfast approval unless 
 justified in the court of the conscience of the 
 average man. A strike which has been con- 
 demned by the social conscience has no chance 
 of ultimate success. One advocate of Socialism 
 
THE ELEMENTS OF INDUSTRIAL STRIFE 21 
 
 sets the truth in simple terms—' Only one force 
 is powerful enough to take away selfishness 
 from everyday life, and that force is intense 
 religious enthusiasm. All other ideals will re- 
 main for ever too weak to tame the beast in 
 man.' That is the root problem. Every sin- 
 cere experiment to realise a new social order has 
 failed because it has not succeeded in taming 
 the beast in man. The truth may be expressed 
 more simply by saying that it is only a new 
 spirit which can create a new social order. That 
 new spirit, so far as men yet know or need to 
 know, is the spirit of Christ. He alone has 
 shown men the way of pea,ce. 
 
II 
 
 THE ECONOMIC JUSTIFICATION OF 
 CAPITALISM 
 
 Every industrial order belongs to one or other 
 of two systems of production, distribution, and 
 exchange. These two are here named Capital- 
 ism and Collectivism. Capitalism may be 
 defined as wealth which has been saved and 
 stored, and is now expended in maintaining, 
 aiding, and rewarding labour, under private 
 ownership and control. Collectivism is the 
 system in which all wealth employed in in- 
 dustry is held under a public or common owner- 
 ship and control. Collectivism, therefore, is 
 used as an inclusive term for such systems as 
 Commimism, Syndicalism, Nationalisation, Co- 
 operation, or any modification of National 
 Guilds. This commvmal ownership and control 
 may be that of a labour organisation, or of a 
 community, or of the State. Industrial strife 
 is the conflict between the methods of Capital- 
 ism and Collectivism. The first question that 
 meets us is the economic justification of 
 Capitalism. 
 
 Capitalism began when the dwellers in the 
 
 18 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 23 
 
 fields of a sparsely-peopled world began to 
 accumiilate herds of cattle. The word ' capi- 
 tal ' supplies a key to the first stage of its 
 history. It is derived from capvt, a head, and 
 its plural, capita. The first wealth was the 
 possession of so many ' head ' of cattle. In 
 these early ages cattle were the most valuable 
 and the most convenient form of capital. When 
 a man's cow calved, he became possessed of 
 ' surplus value,' although how much labour was 
 stored in that increase of capital is not a sum 
 in arithmetic. As a man's stock of cattle in- 
 creased, he dug his well to supply them with 
 water, and stored their hides for future use. As 
 his flocks enlarged, skill and foresight, thrift 
 and labour, the construction of shelters and 
 folds, the risk and adventure of going farther 
 afield, were required, and there was a conse- 
 quent enrichment. Land was won from the 
 wilderness. Trees were felled and seasoned. 
 Tools were fashioned and skilfully adapted to 
 economise toil and time. Hides were tanned, 
 flax was grown, and wools were woven. In this 
 way a man became a capitalist. 
 
 There came a day when one man gave to 
 another the use of his field, or bullock, or reap- 
 ing hook, receiving some portion of the product 
 which was thus made more abundant. When 
 this return was given, ' rent ' was paid, and 
 
24 THE QUEST OF INDUSTRIAL PEACE 
 
 ' interest ' was rendered. In the long ascent of 
 man, and under the conditions of an enlarging 
 and more complex civilisation this directness 
 of intercourse could not be maintained. Pos- 
 sessions began to be represented by tokens, 
 because of their ease and security in distribu- 
 tion and exchange. A piece of stone, a notched 
 stick, a few dainty shells, a bit of precious metal 
 fashioned into a coin, and finally a scrap of 
 inscribed paper — our most common form of 
 exchange — ^are not wealth. They are merely 
 tokens. ' Money ' is entirely composed of these 
 tokens of a wealth which cannot be passed 
 from hand to hand. The capital of to-day is 
 the finely differentiated development of this 
 capital of the earliest ages. No one dreamed 
 in the past that this natural, indispensable, 
 and most convenient economic method, which 
 was based on the right of private possessions, 
 did wrong to any man. The one evident wrong 
 was to break its code of laws, or to violate 
 the honourable fulfilment of its obligations. 
 
 Capitalism must have had a certain reason- 
 ableness, or it would not have grown. It 
 must have had obvious advantages, or it would 
 not have received the sanction of history. It 
 must have an economic justification, or it 
 would not have been continued. That econo- 
 mic justification we shall now consider. 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 25 
 
 I 
 
 The first line in this justification is the proved 
 power of Capitalism in the production of wealth. 
 The power to produce wealth will remain one of 
 the tests of an industrial system. It is not the 
 only test, but when we are reminded, to use the 
 heated language of an inaccurate writer, that 
 under Capitahsm ' Labour is bought and sold 
 as an article of commerce, so that the workers 
 are degraded to a condition of poverty and 
 wage-slavery,' we shall remember that it is a 
 great virtue that Capitalism produces abun- 
 dance of wealth. The statement that too much 
 wealth may be produced, can be left to the 
 judgment and common sense of men. For in 
 truth the only hope for the attainment of a life 
 free from excessive toil, with abundance of 
 leisure and large opportunity, is the increase of 
 wealth. Wherever the wealth of a community 
 is limited, either in old civilisations or in new 
 and undeveloped lands, men are always on the 
 verge of destitution. The only possibility of phy- 
 sical well-being for all is to have goods produced 
 in abundance. It is the consumer's first interest 
 — and all men are consumers — ^that the market- 
 place should be stored with abundant wealth. 
 
 The enormous production of goods — ^the things 
 which can be eaten and drunk and worn and 
 
26 THE QUEST OF INDUSTRIAL PEACE 
 
 employed to minister to human well-being— 
 imder Capitalism stares every one in the face. 
 The statisticians cover their pages with the 
 figures of the stupendous increase of the wealth 
 of the world. They tabulate the increase not 
 of the money values, which may be a sign of 
 poverty, but of those real possessions which 
 enrich and gladden life. These possessions are 
 not to the largest extent held and enjoyed by 
 the rich. They can be estimated in their money 
 value by the millions deposited in Savings 
 Banks, and the even larger sums in Co-operative 
 Societies, and Insurance Companies. They 
 have a more concrete proof in the larger and 
 fuller supply of the comforts and luxuries of 
 life. The white loaf on the table, the warm and 
 well-cut clothing of the children, the furnishings 
 of the home, have a quality and richness not 
 dreamed of two generations ago. The life of 
 the average working man, when there is no 
 waste and no profligacy, is full of an ease and 
 enjoyment denied to persons of means when the 
 last century began. He has longer holidays, 
 shorter hours of toil, and multiplied social re- 
 creations. These are the portion of labour 
 because of the abimdant production of wealth 
 under Capitalism. There may be accusations 
 laid against some of the methods employed, 
 but this supreme function cannot be denied. 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 27 
 
 II 
 The second line in its justification is that 
 Capitalism secures and develops the efficiency of 
 labour. Labour is helpless without capital — as 
 helpless as an engine without steam, or a knife 
 blade without a handle. But only as capital 
 is increasingly stored, and abundant, and under 
 personal control, can it efficiently secure and 
 develop labour. Some unthinking speakers de- 
 clare that all that is required by labour is ' the 
 raw materials of nature.' But whatever may 
 have been true about ' the raw materials of 
 nature ' in the dawn of history, the phrase has 
 no meaning to-day. Everything labour now 
 works upon is a part of the store of capital. 
 Brain and hand, thrift and resource and sacri- 
 fice have already made what may have been 
 once ' the raw materials of nature ' into capital 
 for the use of labour. Land was useless so long 
 as it was desert, or swamp, or rock-strewn hill- 
 side. When a claim is made for a division of 
 the land, or a raid is carried out on a farm with 
 its drained fields and costly dykes, on the ground 
 that land is one of the raw materials of nature, 
 these acts are based on a thoughtless untruth. 
 If there be any open, untamed spaces labour can 
 take possession of them without any one re- 
 claiming, to discover how much labour can do 
 
28 THE QUEST OF INDUSTRIAL PEACE 
 
 without capital. Even water is of no use until 
 it has been stored and conducted to the 
 labourer's hands at the expense of capital, and 
 so become capital itself. A deposit of precious 
 metal is so much blue, or brown, or yellow 
 earth until capital has been expended upon it. 
 To secure and develop the efficiency of labour 
 is a function of capital. 
 
 This efficiency is most skilfully and most 
 economically directed under private ownership 
 and control. The capitalist is inspired by a 
 large number of potent incentives, and some of 
 these are flawless in their nobiUty. He may be 
 a patriot with a desire to benefit his country- 
 men. He may be a wise-minded lover of 
 humanity, as Robert Owen was at the beginning 
 of his career, and as Lord Leverhulme desires 
 to be. Or he may be inspired by self-interest. 
 But self-interest is not selfishness, nor need it 
 pass to that degradation. ' Thou shalt love thy 
 neighbour as thyself,' not more than thyself, is 
 the finely balanced command. Self-interest is 
 as necessary as self-preservation, which is 
 simply its first line of action. Self-interest be- 
 comes selfishness when it wrongs the interests 
 of others. A man who promotes the efficiency 
 of labour advances not only his own interests, 
 but the interests of those who co-operate with 
 him. The perfect adaptation of his equipment, 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 29 
 
 the watchful superintendence of the conduct of 
 the work, and the goodwill of those whom he 
 employs, are the interest of the capitalist and 
 of those who serve with him. 
 
 There are features of this efficiency under 
 Capitalism which require to be emphasised. 
 One of these is the power of a swift and im- 
 trammelled initiative. Only the individual 
 capitalist, or a small directorate, can take that 
 prompt and daring action required by a chang- 
 ing situation, a fresh opportimity, or a 
 threatened disaster. This power of initiative 
 has advanced the interests of the whole com- 
 munity in ways which are often overlooked. 
 Advocates of State Socialism and of Nationalisa- 
 tion ignore the fact that the enterprises which 
 they wish the State to control were begim and 
 developed under private initiative. The gas 
 and water companies, the early tramway 
 systems, the dock and harbour developments, 
 and a large number of the civic improvements 
 which Socialism desires to place under public 
 control were brought to efficiency by the fore- 
 sight, skill, and energy of an individual mind. 
 Waste both of capital and labour, with a con- 
 sequent loss to the general well-being are the 
 inevitable consequences of a loss of private 
 initiative. 
 
 Another feature is the resourcefulness and 
 
80 THE QUEST OF INDUSTRIAL PEACE 
 
 economy in management and adaptation. The 
 public outcry and the private grousing about 
 the hide- bound methods and red-tape pro- 
 cedure of State departments should have cast 
 any ignorant and shallow approval of State con- 
 trol out of men's minds. The saddest pages of 
 the past few years of history are those which 
 reveal the sloth and incompetence of public 
 management. Even imder the pressure of 
 war, which might have stirred any man out of 
 an almost criminal apathy, careless blundering 
 continued. The Government was compelled to 
 ' fire ' controller after controller, to reconstruct 
 boards of management, and at last to call in 
 individuals, and to clothe them with the power 
 of the capitalist, so as to save not only the 
 resources, but the life of the nation. 
 
 The most striking feature of this efl&ciency is 
 the prevention of waste. It is the most dis- 
 tinctive cause of shame to find that in a nation 
 with such supreme business abilities as ours, 
 the waste of men and of means, and the reck- 
 less spending, and as reckless buying, has swollen 
 the national debt by hundreds of miUions be- 
 yond any possible need. The word ' squander- 
 mania ' is the keen-eyed popular description of 
 this shameful waste. But the waste was as 
 scandalous in the slacking and shirking of the 
 employees of these departments, and still more 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 31 
 
 vexing in the frequent instances where those in 
 authority furthered the interests of friends and 
 relatives at the cost of the State. Beyond these 
 outstanding instances of waste, there was the 
 slow pace of all employees, because no overseer 
 with a keen eye for economy cared to check 
 them. A Member of the House of Commons, 
 whose Socialism has now suffered some wear 
 and tear, stood up to maintain that men will 
 work harder and more steadfastly if they were 
 to work for the State, and not for the capitalist. 
 He was reminded of the lounging and easy-going 
 employees at Whitehall. The public report 
 declared that his face flushed in confusion. 
 Capitalism secures efficient labour. 
 
 ui 
 
 A third line in its justification is that it meets 
 the variety and complexity of modern civilisation. 
 The advocates of Collectivism do not face the 
 whole breadth of life when they are dealing 
 with the problems of production and distribu- 
 tion. They focus their thoughts almost en- 
 tirely on the conditions and necessities of a 
 crowded city or an industrial centre. The 
 problem of agriculture, the largest and most 
 important industry in the realm, is passed by 
 either in silence or with a meagre attention. 
 But human life is a much more varied and com- 
 
32 THE QUEST OF INDUSTRIAL PEACE 
 
 plex adventure than the production and distri- 
 bution of its first necessities. There are 
 supreme interests of humanity whose variety 
 and complexity demand more than any form 
 of Collectivism can give. There are ideals and 
 hopes and joys which are little affected by the 
 question of wages and status. Literature and 
 art, research and discovery, and, above all, the 
 truths and obligations of religion are the objects 
 of their devotion. There are thousands of men 
 and women who care not at all what share they 
 have in the world of political ambition, or even 
 of economic and social well-being. They are 
 stirred by a nobler passion. Only as such 
 men are free, even at great cost to their 
 worldly comfort, can they exercise them- 
 selves in the variety and complexity of 
 modern life. That freedom is possible only 
 under Capitalism. 
 
 Beyond these questions which are simple and 
 entirely social, there is the wide range of inter- 
 national relationships both in commerce and in 
 politics. There is also that patriotism which 
 may become an ennobling passion although it 
 sinks too frequently to a selfish antipathy. 
 This wider horizon has been descried by the 
 more far-seeing of collectivists. The holding 
 of conferences in the various capitals of the 
 world, and even the founding of the three Inter- 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 33 
 
 nationals with their meetings in London, New 
 York, and Geneva, are witnesses to the fact of 
 the variety and complexity of modem civilisa- 
 tion. But the disastrous failure even to keep 
 peace within these conferences, partly through 
 personal antipathies, and partly through 
 national hatreds, has proved that no solution 
 can come from such methods. Nations are not 
 artificial unities which can be scored out as a 
 line can be blotted in a treaty. They have 
 their own individualities, their own methods, 
 their own ideals. A world-wide Socialism will 
 enslave not only the individual industry, but 
 the national life. As a simple fact the business 
 of the world cannot be carried on, and the pro- 
 gress of the world cannot be continued, without 
 the wit and the wisdom of leaders of industry 
 conserving freedom both for the nation and the 
 citizens of the Empire. 
 
 This problem of the variety and complexity 
 of life has been met by a suggestion which few 
 can consider with any seriousness. That is 
 that a common ' pool ' of the product of labour 
 might be made, out of which ' a subsistence 
 dividend ' might be given to every individual. 
 In this way one man might devote himself to 
 artistic endeavours, another to intellectual in- 
 terests, another to an ascetic and lonely reUgious 
 life, and another to no work at all. Mr. Dooley 
 
34 THE QUEST OF INDUSTRIAL PEACE 
 
 poured his witty scorn upon this absurd sug- 
 gestion in the comment that he would employ 
 himself in feeding the swans in Central Park. 
 Some of the less hare-brained Socialists shrink 
 from the full contention that men might draw 
 their dole in perfect idleness. Others are willing 
 to pay a certain larger sum than the subsistence 
 dividend to those who would work. No other 
 beyond its writer has any confidence in Mr. 
 Wells's bland statement that, imder these con- 
 ditions, no man would be idle, and that every 
 one would be inspired with a passion for work. 
 But no advocate of this Utopian suggestion 
 has ever faced the obligation of maintaining an 
 industrial and economic order under such con- 
 ditions. For one thing it is nakedly unjust. 
 For another, it is corrupting to the idler who 
 will eat bread he has not earned. For a third, 
 it is almost incredible to believe that honest 
 men will continue to produce and to share the 
 product with those who will lounge through a 
 whole day, or for themselves be meanly content 
 with a pauper dividend. This kind of talk is 
 dying down. The keenest-minded SociaUsts 
 are silent, or, if not silent, are compelled to 
 admit that Capitalism does face the variety and 
 complexity of life— but as they allege at too 
 great a cost to things of greater value. 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 85 
 
 IV 
 
 A fourth line in its justification is that it 
 conserves the well-being of the family and the 
 home. This line depends for its acceptance on 
 those who value home and family life. With 
 many coUectivists the individual and not the 
 family is the vmit of the social order. That is 
 one of the most fundamental blunders. 
 Throughout aU life the family is the real unit, 
 and the only sufficient unit. A bear robbed of 
 her whelps, a hen with her brood under her 
 wing, an eagle whose nest is assailed, a woman 
 whose child is imperilled, present the proofs 
 that the family is the unit, both according to 
 nature and to spirit. In religious thinking the 
 family is the foundation of the State. The 
 Hebrew always thought of himself and ' the 
 children which God had given him ' as the 
 social unit. Jesus Christ reaffirmed this truth 
 with a stronger emphasis, and both the cradle 
 at Bethlehem and the home at Nazareth give it 
 significant confirmation. 
 
 But no social order can receive the assent of 
 those who have recognised the truth and grace 
 of the family imless it promotes and conserves 
 its well-being. An iijdustrial order must en- 
 able the head of the household to provide for its 
 needs. These needs are not merely food and 
 
36 THE QUEST OF INDUSTRIAL PEACE 
 
 clothing. Men and women have conceptions 
 of duty and of destiny, of the unseen and the 
 eternal, and of the obligations they impose. 
 One of the noblest moral passions finds exercise 
 in the ordering of the life of the home, the 
 maintaining of its atmosphere of trust and 
 affection, the provision for the wants and the 
 whole well-being of the children. That can be 
 attained only under the freedom which Capital- 
 ism can give, and the resourcefulness in action 
 which a father and mother can take in a perfect 
 devotion. 
 
 The broad historic proof that Collectivism is 
 inimical to the family can be seen in the fact 
 that every operative form of Collectivism has 
 denied the right of the home, as the Christian 
 ideal dictates, to persist. Rousseau, the potent 
 prophet of Socialism, committed his five chil- 
 dren, as soon as they were born, to the care of 
 a public institution. The communists of the 
 past, with their phalansteries, held that children 
 were the common property of the industrial 
 settlement. Some modem Socialists have gone 
 even farther.^ They have demanded that 
 Christian marriage shall be discountenanced, 
 and have even declared the woman's right to 
 promiscuous intercourse. The most common 
 form is to be found in the project of committing 
 
 ' Cf. Marx, Gommunist Manifesto, p, 19. 
 
ECONOMIC JUSTIFICATION OF CAPITALISM 37 
 
 the offspring to the care of institutions where 
 trained nurses and teachers shall bring up the 
 children. These counsels are supported usually 
 by women who are childless, else this proposal 
 would never be put on paper. But the most 
 emphatic proof is given by the regulations of 
 some of the Russian Soviets. They drew up 
 elaborate regulations for ' the use of the woman ' 
 with consequent public provision for the care 
 of the progeny. The simple peasant rebelled 
 against laws which outraged every pure and 
 holy feeling, and he craved and held possession 
 of the land — ^the highest form of capital — simply 
 because he maintained the right to a family and 
 home. But instinctively, as well as logically. 
 Collectivism knows that the family is fatal to 
 its ideal. 
 
 One of the reasons why the family is bound 
 up mth Capitalism is to be found in the neces- 
 sity for freedom, not only in the possession and 
 use, but in the disposal of wealth. The in- 
 heritance of wealth is one of the rights and 
 obligations of the father and mother. Every 
 family has the indefeasible right not only to 
 employ its possessions in the provision for the 
 family life, but to leave them as legacies to the 
 children whom they have brought into the 
 world. This is one of the focus-points of 
 resistance to Socialism which is supported not 
 
88 THE QUEST OF INDUSTRIAL PEACE 
 
 only by the Christian, but by the universal 
 conscience. To deny the right of inheritance 
 would be to take away a powerful and purifying 
 incentive with disastrous economic conse- 
 quences. There would be a slackness in 
 endeavour, and a shirking from any labour 
 beyond a provision for the needs of the day. 
 Men insure their lives, practise frugality and 
 thrift, and exercise a self-control which is en- 
 nobling, to make some provision for those they 
 may leave behind them. To conmiit to the 
 care of public authorities some maimed, or 
 delicate, or weak-minded child would be to 
 most men an xmbearable anguish on a dying 
 bed. Nothing more induces a manly inde- 
 pendence, a watchfulness in personal habits, 
 and a consequent steadfastness and diligence 
 in all life's duties and labours, than this pro- 
 vision for one's own household, with the fore- 
 thought implied in meeting the vicissitudes of 
 life. It is a supreme and final justification of 
 the private ownership and control of wealth 
 that it conserves the well-being of the family, 
 provides a home in which there may be a true 
 discipline of character, fosters a loyal love and 
 fellowship, and affords some security for the 
 days which every wise man fears. 
 
Ill 
 
 THE MORAL VALUES OF CAPITALISM 
 
 Capitalism, as a system, has an easy economic 
 justification. It produces abundance of wealth. 
 It promotes the efficiency of labour. It meets 
 the complex necessities of an ever more deli- 
 cately organised civihsation. It conserves and 
 enriches the life of the family and the home. 
 All of these have their own moral justification, 
 but there is a further field in which the moral 
 values of Capitalism are supreme. It is not 
 to be contended, for reasons we shall afterwards 
 consider, that these moral values are always 
 attained. There is nothing perfect vinder the 
 sun. But the affirmation is here made that 
 Capitalism has the power to advance the moral 
 interests of men, to mould the character of the 
 individual, and to minister to the upward 
 calling of the race. 
 
 I 
 Before setting down these moral values we 
 must define the term capitalist, and rescue it 
 from an unjust scorn. A dispassionate defini- 
 tion declares the capitalist to be the possessor 
 
 89 
 
40 THE QUEST OF INDUSTRIAL PEACE 
 
 of private property which he employs, or lends 
 to others to employ, in industrial enterprise, 
 receiving a share of the product. From the 
 heated speeches of some who condemn Capital- 
 ism it would be thought that the capitalist is as 
 vicious in character as an adulterer, or a welsher 
 at a race meeting. He is commonly conjured 
 up as a bloated ' profiteer ' who has battened 
 on the enslavement and degradation of helpless 
 labour. Others use the term capitalist more 
 guardedly to describe a master of industry, who 
 takes a callously selfish share of the product as 
 his return for his skill, oversight, and risk. 
 With a still greater moderation others include 
 those who lend the wealth they have saved, or 
 inherited, to an employer of labour, or to the 
 State, receiving dividends, but having no share 
 in the active industries which are carried on, 
 or the services which are given. Strangely 
 enough some of these accusers are found among 
 the courteous Fabians,^ or the more urgent 
 syndicalists, who are Uving in ease on dividends 
 they denounce as unjust. University gradu- 
 ates enjoying fellowships secured by endow- 
 ments make protest against the baseness of 
 
 ' The word Fabian has been taken from Qnintus Fabius Maxi- 
 mus, a member of a distinguished Roman family, who was sur- 
 named Ounctator, i. e. ' the delayer,' because of his cautious pro- 
 cedure while he was consul about 230 b.c. He was a strenuous 
 opponent of all aggressive policies, and was noted for his prudence 
 and courage. 
 
THE MORAL VALUES OF CAPITALISM 41 
 
 Capitalism. August Bebel and William Morris 
 are only two out of many more, who have spent 
 years in denouncing the capitalist, to leave 
 behind them ample wealth to their children. 
 Mr. Keir Hardie did not die a poor man. He 
 consented to own property before the end. At 
 a meeting of the Independent Labour Party 
 the speaker was a charming and accomplished 
 lady. She had risen from an elaborate dinner 
 at the most expensive hotel in the city, and had 
 driven to the hall where the meeting was held 
 in a costly motor. She appeared, dressed in 
 the height of fashion, to denounce the capitalist 
 as a thief and a murderer ! A defence of these 
 things may be attempted by saying that all 
 such persons will adapt themselves to the social 
 state, when once it is founded. But a cause 
 which does not impel a man to live for it, and 
 after its ideal, without waiting for its millen- 
 nium, does not carry conviction on its face. 
 
 The true capitalist is not by any necessity to 
 be included among any of these who degrade 
 the term, any more than the true labourer is to 
 be included among the shirkers. The capitalist 
 is any one who possesses wealth used in in- 
 dustry. To the number of those who are 
 usually so denominated, we must add the 
 depositors in Savings Banks, the shareholders 
 in co-operative stores, building societies, and 
 
42 THE QUEST OF INDUSTRIAL PEACE 
 
 large supply agencies, the small-holders and 
 the proprietors of little farms, where every 
 square yard is a precious heritage, the traders 
 with single shops of their own service, and the 
 holders of shares and debentures in any joint 
 stock company. These are the vast majority 
 of the capitalists. When we consider how they 
 have been increased in the last few years by the 
 millions who have invested their frugal savings 
 in the Government Stocks, we realise that the 
 term capitaUst should include the great mass of 
 the people. One effect of this is that the two 
 words bourgeoisie and proletariat have lost any 
 distiactive meaning, if ever they were anything 
 more than absurd fictions. The question we 
 are discussing, therefore, is the moral value of 
 being a possessor and controller of private 
 property, employed in the production of wealth. 
 The affirmation is that Capitalism yields a moral 
 discipline, with which there is bound up the 
 well-being of humanity. 
 
 II 
 The first moral discipline of Capitalism is 
 that it requires and secures a personal liberty. 
 Liberty is a word which most men use according 
 to their liking. With Rousseau it meant free- 
 dom from law. Many among ourselves think 
 of liberty as doing what one pleases without 
 
THE MORAL VALUES OF CAPITALISM 43 
 
 regard to the interests or convictions of others. 
 Some use the term to mean a wilful and self- 
 determined fashioning of one's life without 
 regard to the laws or customs of the organised 
 society whose protection they claim and enjoy. 
 There are others, who are so self-centred in 
 their individualism, that they interpret liberty 
 as a right to defy all the conditions which 
 civilisation imposes. They have not realised 
 the truth of Dr. Johnson's penetrating saying, 
 ' There is no condition of life in which we can 
 escape from the conditions of life.' Yet one 
 may read and hear men and women declaring 
 that when a man finds himself under the law 
 that he must eat his bread in the sweat of his 
 face, and must keep times and hours and accept 
 wages, so that others may not be deprived of 
 their opportimity of work, his liberty has been 
 taken away. 
 
 The truth about liberty can be reached only 
 by making distinctions. A man's personal 
 liberty, in a world like ours, can be absolute only 
 in thought. It may have large room for ex- 
 pression in speech. It can seldom be entirely 
 uncontrolled in action. That is licence and 
 lawlessness. Each individual's personal Uberty 
 is always conditioned, not only by the rights 
 and liberties of others, but by the obligations a 
 man has to others, and to the community. It 
 
44 THE QUEST OF INDUSTRIAL PEACE 
 
 is also limited by the general conception of a 
 man's own moral well-being. The attempt to 
 commit suicide is a moral and a legal crime. 
 To impose one's individual conception of life 
 and obligation on others is a tyranny. To use 
 force, if that conception is not accepted, is the 
 supreme political wrong. When a Trades Union 
 supports a section of the community by a sym- 
 pathetic strike which imperils the general well- 
 being, it is following the exact course of the 
 autocrat of the past. No one is entitled to play 
 the highwayman and to hold up the passengers 
 in the public coach for his own gain. John 
 Milton in his Areopagitica, that noble defence 
 of one indefeasible liberty, sets down the truth 
 when he writes, ' This is not the liberty for 
 wJiich we can hope, that no grievance ever 
 should arise in the commonwealth — ^that, let 
 no man in this world expect : but when com- 
 plaints are freely heard, deeply considered, and 
 speedily reformed, then is the utmost bound of 
 civil liberty attained that wise men look for.' 
 
 To come to concrete examples of what this 
 rightly-defined liberty means in the sphere of 
 industry, we may say that it includes the right 
 to possess property and to use it in any way 
 that does not conflict with the well-being of 
 society ; to sell and to buy with a freedom from 
 hampering and limiting conditions ; to work or 
 
THE MORAL VALUES OF CAPITALISM 45 
 
 not to work as a man may incline, if he will take 
 the consequences and remember that it in- 
 cludes the right to starve ; to accept or to 
 refuse conditions of work he thinks unjust ; to 
 strike along with his group of workers as a 
 protest against unfairness ; and also to lock out 
 those who have worked for him, and with him 
 if they refuse to accept the conditions agreed 
 upon, or attempt to impose conditions he be- 
 lieves to be fatal to the success of the industry. 
 Only under Capitalism can such a personal 
 liberty be secured. A personal liberty, as with 
 aU true freedom, must leave a man free to 
 exercise his wiU toward the whole environment 
 of life, imder the conditions which have just 
 been considered. Every man finds himself with 
 relationships toward men not only as fellow- 
 workers or as employers, but as friends and 
 acquaintances. He finds himself with still 
 more delicate obligations, especially toward 
 those of his own household. He is compelled 
 to realise that he has an equally obligatory 
 relationship toward the State. Beyond these 
 relationships, which can all be defined more or 
 less sufficiently by statute, he has relationships 
 toward a multitude of interests, and above all 
 toward the unseen, and yet most potent, influ- 
 ences of the spirit. But in no one of these 
 spheres, whether it be in the sphere of work, or 
 
46 THE QUEST OF INDUSTRIAL PEACE 
 
 of more tender obligations, or more command- 
 ing interests, is he at liberty unless he has 
 possessions. The man who has no possessions 
 has no freedom in his mode of private life or of 
 public duty. To act so as to express himself, 
 to co-operate so as to relate himself, and to 
 serve so as to respect himself, he must have a 
 share, under his own control, of the possessions 
 possible to life. Burns set the truth in his own 
 pregnant way when he declared that he desired 
 possessions, 
 
 ' Not for to hide it in a hedge. 
 Nor for a train-attendant, 
 But for the glorious privilege 
 Of being independent.' 
 
 The man who is simply a creature of the State 
 or a member of a modem Trades Union which 
 controls his whole industrial action, does not 
 possess a personal liberty. The events of these 
 last years, when men with wives and families to 
 support have been compelled to strike, so that 
 they spent weeks in fear and anxiety, and 
 found themselves impoverished, give ample 
 proof that private possessions and personal 
 liberty go hand-in-hand. But the man who is 
 not frugal and fore-thoughtful, who has nothing 
 which he can spend sparingly and save for ' the 
 rainy day,' and, therefore, cannot become one 
 of the many millions of capitalists, cannot 
 
THE MORAL VALUES OF CAPITALISM 47 
 
 secure a personal liberty. He can be nothing 
 more than a serf fed and clothed by the State. 
 The moral discipline of this power of possessions 
 need not be argued. There are races which are 
 sometimes sneered at for their frugality. These 
 are the same races who are admired for their 
 caution and foresight. These are also the races 
 which are dominated by a passion for liberty. 
 They have learned that without personal 
 property, without a little store on which a man 
 may fall back in time of need, a personal liberty 
 cannot be maintained. A man might be made 
 secure against actual want by some weekly dole, 
 but a weekly dole binds a man even to the place 
 of his abode, and holds him like a hound on the 
 leash of the State. It is only by liberty, and 
 the perils of liberty, that those races which are 
 dominant on the earth have reached their moral 
 and intellectual pre-eminence. 
 
 Now against all liberty Collectivism always 
 strikes with all its force. Mr. Sidney Webb, in 
 his Fabian Essays, makes a declaration which 
 lays bare the truth. ' We must abandon the 
 self-conceit of imagining that we are inde- 
 pendent units.' He regards the State as an 
 organism in the same way as the human body is 
 an organism. Its imits are ' cells ' or ' atoms.' 
 We know little about the amount of personal 
 liberty possessed by a cell or an atom, but we 
 
48 THE QUEST OF INDUSTRIAL PEACE 
 
 know that it is not the liberty due to manhood. 
 Mr. Webb leads on with perfect logic to the 
 conclusion that as against the State neither 
 labour nor capital have any right except that 
 of bare maintenance— the right of the cell in 
 the body. We can see at a glance how this 
 works out in practical life. A workman could 
 not change his labour at will. He could not be 
 free to take any course which those in authority 
 would not approve. He could not use any 
 possessions to advance any cause. He could 
 not support a free press, not only because he 
 would have no capital, but because no Socialist 
 State would allow the expression of opinions 
 perilous to its own life. The individual would 
 be under a continual regimentation. Mr. Keir 
 Hardie used to argue that as there was an army 
 of warfare, there should be also an army of 
 industry. Every man who has served knows 
 the amount of personal liberty allowed in an 
 army. The logical and historic issue is con- 
 scription for industry. The Russian Soviet, 
 the first thorough-going example of such a 
 State, has given, in its merciless methods, a 
 bitter and disillusioning proof, even to per- 
 sonally conducted Socialists on a visit to 
 Moscow, that Capitalism alone secures per- 
 sonal liberty. That is one of its supreme 
 moral values. 
 
THE MORAL VALUES OF CAPITALISM 49 
 
 m 
 
 The second moral discipline is that it supplies 
 a varied and potent moral incentive. In morals 
 motive is all important. If men would live and 
 act only from high and \mselfish motives, a fair 
 and beneficent economic order would evolve as 
 naturally as a stalk of corn from the seed. But 
 a man seldom acts from the highest motive, and 
 still more seldom from a single motive. A 
 motive may not be the highest in the hierarchy 
 of motives, and yet may be entirely worthy. 
 The overlooked truth is that the incentives of 
 life must be adequate to human nature as it is, 
 and must be comprehensive enough for all life's 
 circumstances. Now and again in an hour of 
 rare inspiration, every man will act from a single 
 heroic motive. Now and again there appear 
 men and women who live out their lives under 
 the dynamic of one noble passion. Yet both 
 history and common knowledge of ourselves 
 declare that men act from many motives, and 
 that every motive which is pure and purifying 
 is a required incentive in life. 
 
 When we look at this matter in a simple 
 concrete way the truth lies clear. We have only 
 to realise what a piece of work is a man, to take 
 a just and accurate view of human nature, and 
 to keep in mind how complex is the mingling 
 
50 THE QUEST OF INDUSTRIAL PEACE 
 
 of the natural and the spiritual within him, to 
 realise the necessity for a whole series of incen- 
 tives. He has a body, and the motive of the 
 supply of its necessities is not base. It is the 
 first imperative of Kfe. He has a mind and a 
 heart and a soul, and all the affectional and 
 emotional and mystic desires demand their 
 wise and healthful satisfaction. He is a spirit, 
 and all the intimations and visions of the inner 
 world meet and control and delight his longings 
 and desires. Whether he be Alexander on his 
 throne, or Diogenes in his tub, he is a complex 
 being, living in an appealing world, and moved 
 by necessary, varied and potent incentives. 
 
 Capitalism alone supplies these motives, for 
 Collectivism would not have allowed Diogenes 
 to own even his tub. Capitalism demands that 
 every man shall work, and shall not receive a 
 weekly dole, and, therefore, makes work a 
 necessity, reaUsing that all men need this 
 imperative. Capitahsm condemns the idle, 
 whether the idle rich or the idle poor, even more 
 severely than Collectivism. It is so intent on 
 production that it regards the man who has 
 no share in some production as a waster of its 
 substance. Capitalism brings all the incentives 
 that bear upon tender affection and upon high 
 ambition, to rouse the will to steadfast action. 
 It follows the wisdom of the Old Testament 
 
THE MORAL VALUES OF CAPITALISM 61 
 
 proverbial philosophy in holding out the rewards 
 of honesty, frugality, and foresight. It opens up 
 positions of power and authority to skill and 
 abiUty and willing toil. It moves men to high 
 adventure, to quick resource, to dangerous risks. 
 It realises that man does not live by bread alone, 
 and therefore comes with alluring promises 
 of more than bread. All of these are worthy 
 motives, and in being moved by them, human 
 nature is purged and purified and perfected. 
 
 A reply to this is sometimes made that 
 Collectivism adopts a higher, less selfish, and 
 even more potent scheme of motive. It de- 
 clares that an ' ideal ' is an incentive for which 
 men should live and work. It is asserted that 
 if private profit and personal advantage were 
 eliminated, men could be given the ideal of 
 ' social service ' and be moved by that to a rare 
 assiduity and strenuousness. They would 
 willingly ' do hard, dull, unpleasant work ' at 
 high pressure. In the language of another 
 collectivist, it is maintained that, if Capitalism 
 were abolished, men would be moved by a new 
 moral passion for toil because of ' an ideal of a 
 common State from which private property has 
 been eliminated and free service is given.' 
 This position seems to be accepted chiefly by 
 men and women who are not down among the 
 people. One does not often find it on the lips 
 
52 THE QUEST OF INDUSTRIAL PEACE 
 
 of those who move the masses. It can be con- 
 futed by three facts which can be stated briefly. 
 The first of these is that no ideal is broad 
 enough, or deep enough, for the whole of life, 
 and for the conditions of life. The motives of 
 earning a man's daily bread, of the personal 
 care of those who are dependent upon him, of 
 the conception of his place in the intimate 
 relationships of life, will always and most justly 
 occupy a chief place in the motives yielded to 
 by the human heart. The incentive of a fair 
 and lovely Ufe for those upon whom a man's 
 affections are placed wiU always be dominant, 
 as they ought to be. The outlook of every even 
 unthinking man, and much more of the thought- 
 ful, upon the vicissitudes of Ufe and his ha\mt- 
 ing anxiety about those events and issues which 
 no State or community can touch, will always 
 make him sensitive toward those personal 
 obligations with which an ideal of a State has 
 little or nothing to do. Kipling put the matter 
 in his own vivid way when he said that the 
 average man was strongly motived by the well- 
 being of the ' missus and the kids.' Burns 
 touched the quick when he wrote : 
 
 ' To make a happy fireside clime 
 
 To weans and wife, 
 That 's the true pathos and sublime 
 Of human life' 
 
THE MORAL VALUES OF CAPITALISM 53 
 
 The second fact is the fallacy of the complete 
 sufficiency of any mere ideal to move the will. 
 An ideal may present itself, clear, alluring, up- 
 lifting, and yet have no potent dynamic amid 
 the tasks and adventures and sorrows of the 
 years. Men are not always obedient to the 
 heavenly vision. They do not always follow 
 the gleam. They continually make the great 
 refusal, and miss the highest. Books have been 
 written with a wisdom as deep as Bacon's, and 
 a moral insight as keen as Heine's, but their 
 writers have not been motived by their own shin- 
 ing ideals. We all must confess that we have 
 been thrilled by the appealing grace of being 
 just, honourable, pure, true, and of attaining 
 a character of moral loveliness and of good 
 report, yet we have not sought it imfalteringly. 
 All men have times when they see the better 
 and choose the worse. Too often Mr. Hyde 
 overcomes Dr. JekyU in the end. The truth is 
 we need more than a high ideal for the stress 
 and strain of hfe. ' When I would do good 
 evil is present with me,' wrote one man who had 
 made the endeavour to fashion his life xmder 
 the power of an ideal. He found that the only 
 sufficient dynamic was a moral passion evoked 
 by a love which nothing could quench. 
 
 The third fact is the fatal one. All these 
 assertions that a man needs only to be given 
 
54 THE QUEST OF INDUSTRIAL PEACE 
 
 security in life, and to have Capitalism elimin- 
 ated, and a high ideal alluring him on, and then 
 he will play a strenuous and victorious part in 
 life, rest upon a false view of human nature. 
 This theory of the inherent goodness of human 
 nature is full of fascination. It has enough 
 truth in it to deceive any one who does not read 
 history, or will not look at human nature 
 steadily and see it whole. There is much 
 good in human nature, but the mixtiire of the 
 evil is, as Browning said, ' a marvel and a 
 curse.' It was the theory behind Owen's 
 position that a man's character depended en- 
 tirely upon his circumstances. It is the con- 
 ception behind the plaintive declaration that 
 when the modem workman falls below his own 
 ideal of truth and honour and justice, he is 
 simply ' a victim of his surroimdings.' It is 
 the thought lurking in the minds of those who 
 lay the blame of the moral evils of our cities 
 chiefly upon the environment, as if the country 
 village knew nothing of moral debasement. 
 No one denies the power of the environment or 
 the obligation to amend it, but the deeper truth 
 is that human nature is biased to evil, and that 
 a man not only has power over his environment, 
 but is able to transform it. That truth is 
 written large in history. It is proved by 
 present-day experience. It is written both in 
 
THE MORAL VALUES OF CAPITALISM 55 
 
 the records of capital and the annals of labour. 
 What is needed is the moral incentive, the 
 varied and potent motive, bearing in upon 
 human desire and will, and that is given freely 
 under Capitalism. 
 
 IV 
 
 The third moral discipline is that it calls into 
 exercise a personal responsibility in the use of 
 possessions. This is the unique moral value of 
 Capitalism. Liberty provides the sphere of 
 moral progress. The motives which appeal to 
 human nature supply the dynamic. Responsi- 
 bility calls forth choice, and prompts to fore- 
 thoughtful action. No doubt there is more 
 temptation to be faced under Capitalism, simply 
 because personal responsibility is continually 
 in action. But temptation comes to be 
 mastered, and in its mastery to rise from a 
 lower to a higher moral character. It is in 
 the use of possessions that this moral endeavour 
 is exercised. 
 
 If we examine the daily life of the labourer 
 this truth lies in clear light. Every working 
 man is called upon, as he ought to be called 
 upon, to save a portion of his earnings. At 
 once forethought, frugality and self-denial 
 are practised. Even if his wage be scanty— a 
 remark out of place to-day— there remains the 
 
56 THE QUEST OF INDUSTRIAL PEACE 
 
 responsibility of dealing with so limited an 
 income, and frugality and seK-denial are exer- 
 cised. If this seem to some sybarites an evil 
 fate, it must be remembered that a toil-worn 
 self-denying man is on a higher moral plane 
 than a weU-fed, heedless pensioner of the public 
 purse. The races which exercise not only an 
 industrial, but a political and moral power in 
 the world have been discipUned through the 
 barrenness of their lands, and the sternness of 
 their endeavours to keep the wolf from the door. 
 They were called upon to exercise a cautious 
 foresight and a constant frugality. As they 
 redeemed their land from the moor and the 
 wilderness, they rose into a moral nobility, 
 unknown to those who were cradled in the lap 
 of ease. The hardy Northerner, compelled to 
 remember the coming of winter, has a moral 
 vigour imknown among the lazzaroni who 
 lounge in slothfulness in the villages of 
 southern Italy. Not only does this sense of 
 responsibility in the use of possessions react 
 upon a man's own moral nature, but it impels 
 him to serve the interests of his fellow man and 
 of the commimity. Such a man is a strength 
 to every commonwealth, and an asset to the 
 State. Citizenship, in its finest phases, is 
 impossible without a free use of a man's own 
 possessions. 
 
THE MORAL VALUES OF CAPITALISM 57 
 
 An even higher moral standard is within a 
 man's reach. He may attain the grace of 
 liberality. We cannot give to others, and 
 cannot practise the generosities and hospitali- 
 ties of life, much less send the timely relief to 
 those in need, unless we have the use of private 
 possessions. No possible scheme of public 
 charity will ever take the place of the private 
 and personal gift. Even were it possible the 
 whole moral atmosphere wo\ild lose its genial 
 and kindly tone. The Greek ethical teachers 
 understood this truth and realised that the 
 poor, i.e. those who are in need of gracious help, 
 shall be always with us. Aristotle writes, with 
 his characteristic insight, ' It is clear, then, that 
 the better plan is for the property to be held 
 separately, while the produce is common. 
 Besides even for the pleasure of the thing it 
 makes an unspeakable difference to regard a 
 piece of property as one's own. Indeed it is 
 probably no mere chance that makes each of 
 us hold himself first in his regard. It is human 
 nature. But being a self-lover is rightly blamed. 
 By this is not meant loving oneself, but doing 
 so too much ; just as we speak of the man who 
 is a money lover, since all love what belongs to 
 them. But to support and succour friends, or 
 guests, or comrades, is a very delightful thing, 
 and this requires our having property of our 
 
58 THE QUEST OF INDUSTRIAL PEACE 
 
 own. The community idea robs us of the 
 virtue of generosity in the use of property.' 
 
 {Politics, ii. 5). 
 
 One thing more. The control of private 
 property affords the power, and stimulates the 
 will, to further the higher interests of life. The 
 thoughts of collectivists are busy only with 
 the question of industry and with the toil of 
 the manual labourer in the large city or in the 
 crowded industrial centres. They are so eager 
 to make him secure, and to reduce disparity 
 between some who have more and some who 
 have less, that they seem willing to sacrifice 
 every interest in life, that there may be an 
 equal dividend. They seem to forget that 
 ' the Ufe is more than meat.' They seldom lift 
 their eyes to those great causes that stir men 
 to the depths, in whose furtherance manhood 
 reaches its highest stature. Under the scheme 
 of life sketched out by some collectivists a 
 man could not hang a picture on his wall, or 
 place a costly book on his shelves, or possess a 
 lovely fabric from the loom. He would re- 
 quire to go to a picture gallery, or to the cheer- 
 less hall of a public library, or to some museum, 
 where delicate embroideries were on view 
 within glass frames. They are blind to those 
 
THE MORAL VALUES OF CAPITALISM 59 
 
 simple delights of having a home within whose 
 rooms one's own ideals of art and of skill can 
 be possessed and exhibited. They have no 
 conception of the deep joy the man has who 
 has bought some valued bit of furniture, at the 
 cost of sacrifice, and in the open market.. 
 
 There are causes still more closely allied to 
 liberty and even more potent to satisfy the 
 quenchless desires of the heart. The Protest- 
 ant desires to advance what he conceives to be 
 the pure religion of Jesus Christ. The Roman 
 Catholic is eager to extend the power of that 
 worship, whose chief bishop is the Pope. The 
 Mohammedan is a keen propagandist among 
 the dark-skinned races. The atheist has his 
 meeting-place, and his journal in which he 
 advocates, with notable energy, his denial of 
 the convictions of believing men. No one of 
 these sacred interests can be committed to the 
 care and support of a State. It would be the 
 desecration of the holiest instincts were men 
 to be deprived of possessions which they 
 could use in furthering these great causes. So 
 that, in all the spheres in which possessions can 
 be used, men rise into 
 
 ' Self-reverence, self-knowledge, self-control,' 
 
 and this moral assent is possible only under 
 Capitalism. 
 
IV 
 
 THE INDICTMENT AGAINST CAPITALISM 
 
 Every justification of Capitalism may be de- 
 scribed, to its prejudice, as the plea of an 
 advocate holding a brief. It is open to the 
 criticism that the case against Capitalism has 
 been lightly touched, if not ignored. We shall, 
 therefore, consider the indictment against it, 
 and shall set it in the terms commonly used by 
 collectivists. 
 
 I 
 The indictment opens with the assertion that 
 while production under Capitalism may be 
 large, it is attained by the economic impover- 
 ishment and industrial enslavement of the 
 labourer. It maintains that production is 
 inevitably carried on imder unjust and re- 
 pressive methods, and that the distribution of 
 the product violates both equality and equity. 
 It passes on to the charge that employment is 
 often exhausting and degrading and always 
 irregular and insecure, with consequent injury 
 to the well-being of the worker. That leads on 
 to a protest against capital sitting soft in ease 
 
 60 
 
THE INDICTMENT AGAINST CAPITALISM 61 
 
 of mind with an abundance which it wastes in 
 selfish indulgence, while labour lives hardly, is 
 meanly housed, and even insufficiently fed. 
 It consummates in the statement, as a last 
 and bitter wrong, that the labourer is a wage- 
 slave deprived of the due status of manhood. 
 
 Three comments on this indictment are in 
 order — ^the first is that the charge and the 
 statement of the consequences are overdrawn. 
 Half a century ago the condition of the manual 
 labourer was a scandal. It roused the protest 
 of every compassionate spirit. But no man 
 who is aware of the weekly sum coming into 
 the homes of the manual workers, and no man 
 who is intimate with the relationships of labour 
 and capital, will accept this highly-coloured 
 picture as true to-day. The shop windows of 
 every market town, the enjoyment of the 
 delicacies of hfe, and the pleasures taken in 
 the times of ample leisure, make some of the 
 charges ridiculous. There are evils, such as 
 the insufficient, insanitary, and sometimes in- 
 decent housing. Some of the reasons for this 
 state of affairs are due to the labourer himself. 
 He will not pay for his housing as he will pay, 
 to select one item of his bill, for his liquor. 
 But the fact that the modem demand is not 
 based on the poverty or the distressed con- 
 dition of the labourer, proves that the old and 
 
62 THE QUEST OF INDUSTRIAL PEACE 
 
 mean conditions have passed away. To-day 
 the demand is made because of the claim to a 
 free and ftill and enriching life. 
 
 The second comment is that this mean con- 
 dition is due, at times, to causes that are 
 strangely ignored. These are recorded in the 
 annals of the police courts, and make up the 
 news of the evening papers. Sloth, waste, 
 and indulgence in even grosser passions are 
 too evident causes of poverty and destitution. 
 Every riverside and factory district will dis- 
 play, in the same common entry, homes of 
 cleanliness, comfort, and taste, and homes of 
 squalor, destitution, and misery. The same 
 weekly wage comes into them all, but in the 
 one case the inmates practise vicious habits ; 
 in the other there is thrift and care. These 
 miserable homes are not due, in any great 
 measure, to the environment. They consti- 
 tute the environment. There are quite as 
 many men and women living as evil lives in 
 other quarters of a great city, only they are 
 not so openly seen, and the residts of their 
 heedless profligacy are not so instant. To 
 those who mistake the effect for the cause, in 
 the case of environment, there is the decisive 
 reminder that the best life the world has known 
 came out of Nazareth. 
 
 The third comment is that, in the drawing of 
 
THE INDICTMENT AGAINST CAPITALISM 63 
 
 the indictment, no account is taken of the real 
 charge against Capitalism. That is the dis- 
 parity between the economic condition of the 
 different classes of our social order. Out of 
 that sense of disparity there comes the con- 
 demnation of wagery, the complaint of a loss 
 of status, the accusation of serfdom, and the 
 demand for equality as an absolute right. Out 
 of it also there rises, like a mist from a marsh, 
 the envy which brings forth greed and hate 
 and suspicion. This root of discord we shall 
 consider more fully. Meanwhile it must be 
 set down that this disparity is no necessary 
 part of Capitalism. It must also be realised 
 that there never has been, never can be, never 
 should be, a complete equality of possessions. 
 Men are not equal, either at their birth, or 
 after it. Their work is not equal, and their 
 authority and reward can never be equal. 
 Under any economic and industrial order there 
 shall always be some set in authority over 
 others. In so far as that authority or reward 
 are luijust, amendment is inevitable. But the 
 need of such amendment is not supported by 
 an indictment so recklessly drawn. 
 
 With these three comments on the state- 
 ment of the indictment we pass on to examine 
 its contentions. These can be condensed into 
 four counts. 
 
64 THE QUEST OF INDUSTRIAL PEACE 
 
 n 
 
 The first is that Capitalism is motived by 
 profit, not by use, and is, therefore, necessarily 
 oppressive to labour. The argument is that an 
 industrial system which would produce only 
 for use would be under no temptation, because 
 it would have no opportunity to wrong the 
 labourer of his share in production and dis- 
 tribution. 
 
 This count rests on the fallacies that profit 
 and use are opposed to each other, and that 
 profit is the amount which has been extracted 
 from both the producer and the consumer. 
 The truth is that the capitalist's first and con- 
 troUing motive is production for use. On no 
 other ground can he expect to secure customers 
 for his product. He need not attempt to pro- 
 duce a commodity for which there is no de- 
 mand. If he produces a superabimdance his 
 profit is gone. If he does not produce a supply 
 which satisfies the demand, the prices rise, and 
 others step in immediately to satisfy the call 
 of the consumer. There are iron laws of pro- 
 duction. The capitalist must supply the actual 
 wants of the community, and must meet, not 
 only the purchasing power, but the taste of 
 the consimier. The capitalist's first aim must 
 be use, not profit. We shall look at this point 
 
THE INDICTMENT AGAINST CAPITALISM 65 
 
 with illustrations, leaving open the question 
 of what happens because of the capitalist's 
 resultant aim of profit. 
 
 That profit and use are complementary can 
 be shown in decisive instances. Some twenty 
 years ago wire manufacturers found that the 
 German factories were making a lighter and 
 cheaper wire than they were producing. The 
 shrewd German mind had discerned that this 
 lighter wire was sufficient for the purposes re- 
 quired. It was in demand for wire fences in 
 the British colonies. The British makers found 
 their goods left on their hands, and their 
 profit gone until they adapted their product 
 to meet the need and the purse of the con- 
 sumer. English tool manufacturers were made 
 uncomfortably aware that G^erman traders 
 were selling a rude but serviceable knife to the 
 West African negroes. Its cost was about one- 
 haK of the knife, of better steel, and finer finish, 
 made in Sheffield. But the price of the Ger- 
 man knife was within the purchasing power of 
 the African native, and he left the costlier 
 British knife in its maker's store. There is a 
 record of the rough, yet fairly efficient bucket 
 which was produced in German factories to 
 supply the wants of the natives of the Congo. 
 The British manufacturer foimd his stronger 
 but dearer bucket left on his hands. Plainly 
 
 E 
 
66 THE QUEST OF INDUSTRIAL PEACE 
 
 the capitalist must produce for use, and to 
 meet the bujdng power of the consumer, or he 
 must make no profit at all. 
 
 This clear evidence is met by the statement 
 that if the producer would keep only use in 
 mind, and would take no profit, the product 
 would be supplied at a still cheaper rate to the 
 consumer. There are stiU labour leaders to 
 be foimd vending this specious fallacy. There 
 are still writers who seem to be persuaded that 
 Capitalism is a costly system of production and 
 Collectivism will, in some miraculous way, 
 satisfy the needs of the commimity at less 
 cost to labour, and with more profit to the 
 labourer than capital. It cannot be too often 
 reiterated that the private producer always 
 supplies the consumer more cheaply, more 
 accommodatingly, more promptly, than any 
 public board or State-controlled factory. The 
 reasons for this are, in part, that the private 
 producer is always intent on enlarging the 
 number of his customers, and, therefore, is 
 eager to lower his prices to meet their power to 
 purchase. In the late war, simply because the 
 private producer was under public control, the 
 prices of goods soared to a height which not 
 only deprived large mmibers of a sufficient 
 supply, but compelled the ' index figure ' of the 
 cost of living to rise to a height which has 
 
THE INDICTMENT AGAINST CAPITALISM 67 
 
 threatened the commercial well-being of the 
 nation. The ' profiteer ' would never have 
 been known, and would have had no oppor- 
 tunity of seizing his so often excessive profit, if 
 Capitalism had been allowed its freedom and 
 resourcefulness. 
 
 This fact that Capitalism secures the well- 
 being of the consumer at the least possible 
 profit can be illustrated by three modern in- 
 stances. Some years ago a newspaper, which 
 contained world-wide and up-to-the-hour news, 
 was beyond the purchasing power of the 
 people. The average man was compelled to 
 content himself with an evening paper in which 
 many of the items were taken from the morn- 
 ing issues. Mr. Harmsworth (the first of the 
 name) realised that by organisation and man- 
 agement he could give the news of the world to 
 every working man at an early morning hour. 
 With a circulation of a million copies every 
 working day— 312,000,000 copies a year— he 
 could so reduce the cost as to sell at the price 
 of the lowest coin of the realm. He published 
 the Daily Mail, in three centres, with a profit 
 on each copy which could be stated only in a 
 row of decimals. The consumer would not be 
 more cheaply supplied if the element of profit 
 were to be eliminated. 
 
 For many years the cotton industry was 
 
68 THE QUEST OF INDUSTRIAL PEACE 
 
 chiefly confined to certain districts because of 
 their humid atmosphere, and especially to the 
 areas of Lancashire and West Yorkshire. This 
 limitation of area prevented the extension of 
 the industry and increased the cost to the con- 
 sumer. An inventor patented a process of 
 damping the cotton artificially, so that it could 
 be manufactured anywhere within the king- 
 dom. The other conditions were abimdant 
 labour and cheap transport, with the result 
 that the whole cost of cotton to the consumer 
 has been lessened. It is clear that the incen- 
 tive of profit works out to the advantage of the 
 consmner, for, indeed, producer and consumer 
 are not enemies, but co-operators in spite of 
 their seemingly diverse interests. 
 
 A third instance is chosen because of the 
 public clamour which arose when the last 
 dividend (1920) of the profits of Messrs. J, and 
 P. Coats, Ltd., were declared. This firm, with 
 its head office in Glasgow, is a combine of the 
 many maniifacturers, both in England and 
 Scotland, engaged in the spinning of thread. 
 It was formed for the express purpose of lessen- 
 ing the costs of production and distribution. 
 A rigorously economical management by a 
 board of competent directors resulted in the 
 employment of fewer agents and smaller clerical 
 staffs, and a skilful adaptation of machineries. 
 
THE INDICTMENT AGAINST CAPITALISM 69 
 
 The wages and salaries were increased. But 
 the sales, because of lowered prices, were so 
 large that the profits exceeded the forecast of 
 the promoters. The notable fact is that the 
 price of the thread was less than before. Even 
 the price during the war did not rise in a pro- 
 portion that might have been expected. Yet 
 the sum of the profits in this last dividend 
 seemed to be open to a charge of gross profiteer- 
 ing. The company invited a public inquiry, 
 and the loud protest was stilled. It was proved 
 that the sewing cotton was supplied to the 
 consumer at a price which left little or no 
 margin at all, for the profits came, to a great 
 extent, from the export trade. It is a fallacy 
 to think that the user would be advantaged if 
 the incentive of profit were to be taken away. 
 The fact that the manufacturer must keep both 
 use and profit in view works out to the con- 
 sumer's gain". 
 
 Ill 
 The second count in the indictment is that 
 capital is theft. This is the charge which is 
 made with a note of passion in the voice, and 
 moves some men to violence. It makes its 
 appeal to the quickened conscience of which 
 we have spoken. It is as old as Proudhon, who 
 expressed it in his famous phrase that ' pro- 
 
70 THE QUEST OF INDUSTRIAL PEACE 
 
 perty is robbery.' Although it was silenced 
 for years by the stiU unanswered reasoning of 
 Bastiat in his Harmonies of Political Economy, 
 it is the eager contention of the collectivists 
 to-day. It appears in the Marxian doctrine of 
 ' surplus value,' in the reasonings of the Fabian 
 Society, and in the arguments of the syndical- 
 ists. But capital, gained as a reward for ser- 
 vice, whether it be the service of a man's hand, 
 or of his brain, or of his goods, is not theft. 
 It is thrift, or a due reward of costly hours of 
 toil, or a return for skiU, resource, or inventive 
 genius. It is the honourable increment gained 
 by putting one's possessions at the disposal of 
 another, to his advantage. 
 
 Look at the matter in the simplest instances. 
 A working man saves five shillings a week and 
 lends it to the Savings Bank or to the State. 
 An overseer shows his ability in management 
 and direction, and out of his consequently 
 larger acknowledgment, saves twenty shillings 
 a week which he invests in some business. A 
 manufacturing firm builds a larger, airier, and 
 more wisely adapted factory, so that they in- 
 crease their output, lessen its cost, and gain a 
 larger profit. A man expends his accumula- 
 tion of savings in lodging and clothing those 
 who are draining a swampy moor, so that its 
 soil yields a harvest. Each receives a propor- 
 
THE INDICTMENT AGAINST CAPITALISM 71 
 
 tion of the product, or it may be a few acres 
 of the land as his reward. On what ground can 
 it be said that such capital is theft ? When 
 capital has been gained dishonourably, or dis- 
 honestly, whether by a workman who slacks 
 and shirks, or by an employer who does not 
 give a fair value in what he supplies, they are 
 both thieves. But capital honestly gained, 
 whether by personal service or the loan of 
 possessions, is not theft. 
 
 Passing from this direct charge, with its 
 rhetorical statement, we find it meeting us in 
 the position that however capital may be 
 gained, the taking of interest on capital is the 
 source of the wrongs denounced in the indict- 
 ment. We may leave aside the contention that 
 all usury is sin. The Hebrew scriptures 
 afl&rmed that view only when interest was 
 taken from a fellow Israelite. The New Testa- 
 ment writers have no hint either that property 
 is theft, or that the reward of the trader using 
 his possessions is unjust, or a source of wrong. 
 Yet some believe that if interest and rent were 
 abolished the evils from which labour suffers 
 would pass away. That is really a foolish 
 imagination. If every man were brought to 
 the common level of a labourer to one em- 
 ployer—the State — ^no one of the wrongs against 
 which protest is made would be lessened. Toil 
 
72 THE QUEST OF INDUSTRIAL PEACE 
 
 which is difficult and disagreeable woxdd con- 
 tinue. Subordination of man to man, which 
 seems to be a red rag to some, so that they will 
 not even be courteous in intercourse lest they 
 seem subservient, would continue. Disparity 
 in status and inequahty of reward in some 
 form would persist. It is not the taking of a 
 just interest, or of a fair rent which produces 
 the wrongs of our social order. The evil is 
 deeper, not to be expelled from the body 
 politic by an adjustment of a system, but by 
 a healing of the soul. 
 
 Face to face, however imwillingly, with 
 these truths the groimd is taken that interest 
 received by a shareholder who has never even 
 seen the workers who toU for the company, or 
 the buildings in which they labour, is the real 
 injustice. But what is that interest ? It is 
 simply the debt of the labourer for the tools 
 with which he works, or for the wealth which 
 has employed and rewarded in advance the 
 skill and resource which directs his labour and 
 puts its product upon the market.. One man 
 lends another the house he has built, the boat 
 he has fashioned, the tools -he has brought to 
 perfection of efficiency and finish. He has 
 given the opportunity for a larger return with 
 a greater ease of toil. Surely the labourer is 
 entitled to make some return, and that return 
 
THE INDICTMENT AGAINST CAPITALISM 78 
 
 is interest. In the same way under the more 
 complex conditions of modem civilisation the 
 shareholders in a manufacturing industry, an 
 engineering company, or a shipping line with 
 a fleet of ships, give the use of the articles they 
 possess, and keep in fitness and order. As 
 they further the labour, promote the comfort, 
 and even provide the pleasure of the persons 
 who use them, they are entitled to interest. 
 To take a larger view, the work of the world 
 would be hindered, its intercourse would be 
 narrowed, and the field of labour would shrink 
 to the pettiest area, if men with possessions 
 could not employ them and adventure them, 
 in projects whose compelling motive is interest. 
 This accusation against capital is made with 
 more rigour in regard to rent. Sometimes it 
 is urged under the plea that land ought not 
 to be in the possession of any private person. 
 A stronger reason might be pleaded for the 
 position, that no other than private persons 
 should own the land, for it is wise that men 
 own the tools with which they work, and land 
 to the largest extent is simply a tool. It is 
 true that those who own the land should be 
 compelled to use it for the public good. But 
 private ownership and control has been proved 
 to be the idtimate wisdom. Even a mimicipal 
 farm, closely scrutinised, is not so profitable 
 
74 THE QUEST OF INDUSTRIAL PEACE 
 
 as one whose fields are under its cultivator's 
 
 eye. 
 
 ' He, who by the plough would thrive, 
 Must either hold himself, or drive.' 
 
 This charge is deepened in its condemnation 
 by an addition which has nothing to do with 
 the real indictment that property is theft, 
 although it increases the prejudice against 
 rent. That is that lands were given by the 
 arbitrary act of a king, or at the caprice of a 
 king's favourite minister, or seized by a bold 
 enclosure, or a successful raid, or a daring 
 squatter's occupation. All these condemnable 
 circumstances, so often beyond the reach of 
 proof, are wholly beyond any equitable remedy. 
 But let them stand as being accurate, and ask 
 if the taking of rent for the use of such lands 
 is a mode of theft, and a source of injury. 
 
 Let it be assumed then that the lands of a 
 country like our own are held iinder a title 
 which we regard as imjust, or at least un- 
 worthy. We must remember that the reward 
 and even the methods of acquiring land were 
 not condemned three hundred years ago, as 
 they are to-day. It was then an open and 
 untamed, and largely wilderness country. 
 Legal possession was not gained or held imder 
 clearly -defined, or even wisely-ordered, statutes. 
 But it is an impossible contention that ser- 
 
THE INDICTMENT AGAINST CAPITALISM 75 
 
 vices which some reprobate, while others ap- 
 plaud, ought not to be rewarded, because some 
 men judge them to be unworthy. A grant of 
 land to a courtier, or even to a courtesan, may 
 rouse an antipathy to their descendants, and 
 seem to be open to the charge of unjust pos- 
 session. To-day, there are millions of men 
 who hold that the distiller and brewer and 
 publican are a curse to the country. There 
 are even larger millions who declare that boxing 
 is a brutal and demoralising sport. Yet no 
 man would insist that the possession of lands 
 which the distiller has bought with his gain, and 
 the prize-fighter possesses through purchase 
 with his stake, should be denied a due rent, 
 even although they have gained possession by 
 the methods of the tiger and the ape. Many 
 of those who declaim at street corners against 
 the holders of land on the ground that it was 
 given or gained without moral desert, would 
 flame into indignation if the publican were to 
 be stripped of his wealth, or the prize-money 
 taken from the pugilist, on the ground that 
 both were thieves in exacting a rent from their 
 land, because it had been acquired by un- 
 worthy and degrading services. 
 
 But these contentions, and, as a consequence, 
 the replies which are made to them, are really 
 beside the mark. Most of the present pos- 
 
76 THE QUEST OF INDUSTRIAL PEACE 
 
 sessors of lands have bought them. Only in 
 rare cases do the lands remain in the possession 
 of the descendants of those who acquire them. 
 Even in such instances they have been en- 
 riched both by the expenditure of care and of 
 means so as to make them more productive 
 and more beautiful. The great majority of 
 the present owners have purchased their 
 estates, or their farms, or their little holdings, 
 by the rewards of their labour, or by the use 
 of their capital. As often they have gained 
 their lands by their energy and toil, their 
 prudence in management, their power of ad- 
 ministration, their genius in art, or science, or 
 literature, their services to the nation or to 
 the State. When they ask that the user of 
 their land, in which their honest gains have 
 been stored up, and by which he is making his 
 living and his profit, should give them a share 
 of the product, their stipulation is one of the 
 most evident honesty. That is rent. If the 
 rent be excessive and capricious, its owner, the 
 capitalist, is unjust. If it be less than a due 
 share of the product, as it has been in the past 
 few years, the user of the land is unjust. If 
 the tiller of the soil extracts an undue propor- 
 tion of its value, or suffers it to become im- 
 poverished, he commits a further injustice. 
 But both interest and rent are the rightful due 
 
THE INDICTMENT AGAINST CAPITALISM 77 
 
 of capital from those who employ it to render 
 their labour more productive and their lives 
 more gracious. It may be true that a better 
 system of land ownership and of land tenure 
 should be devised. It may be as true that a 
 more efficient service and supply of the whole 
 varied needs of the community should be given 
 by land, and by those responsible for its culti- 
 vation. In no direction are our present laws 
 less adequate than in their deahng with the 
 whole situation both of ownership, and con- 
 servation, and control of land. But looking at 
 the indictment against capital we reach the 
 conclusion that as interest from capital honestly 
 gained under the law of the land, is entirely 
 honourable, so rent charged for the use of 
 land is entirely worthy. Capital, in itself, is 
 not theft, and its fair reward is its honest 
 right. 
 
THE INDICTMENT AGAINST CAPITALISM 
 
 {continued) 
 
 Of the four counts in the indictment against 
 Capitalism the first, that it aims at profit, not 
 at use, deals with the controlling motive. 
 The second, that capital is theft, deals with 
 the alleged method of the gain of capital. 
 The third count deals with the resultant of 
 these two charges. It is affirmed that Capital- 
 ism compels a competition which is both 
 economically wasteful and morally depressing 
 to labour. This third count is supported by 
 declarations that the numbers engaged both in 
 the management of production and the mode 
 of distribution are needlessly large ; and that 
 they absorb a share of the product which is 
 due to the manual worker. It is also asserted, 
 with a keener passion, that competition tends 
 to overdrive the labourer, for he is regarded as 
 only a part of the machinery. The final 
 allegation is that competition issues in over- 
 production, due to the hustled pace of the 
 competitors, so that a periodic cycle of dull 
 trade sets in, when labour suffers the horror of 
 
 78 
 
THE INDICTMENT AGAINST CAPITALISM 79 
 
 destitution with a criminal result of moral 
 deterioration. 
 
 I 
 
 When we examine this charge of the economic 
 wastefulness of competition, we mark that the 
 evidence is usually taken from a limited area. 
 It is chiefly drawn from the public services, not 
 from actual production. The most notable 
 instances are taken from transport. Two rail- 
 ways carry goods to the same area ; a single 
 line is sufficient. The wagons of one company 
 deliver goods to stations on another; they 
 return empty. Several shipping firms possess 
 fleets of vessels, maintain office establishments 
 and waste money in advertisements ; a single 
 agency could conduct the service. Three milk 
 carts supply one street ; one only is required. 
 Similar instances are produced from other 
 departments of service. 
 
 In so far as there is really waste no defence 
 can be made, or ought to be made, under any 
 system. But the excess of employees and the 
 over-supply of goods are not articles of faith, 
 nor are they methods, approved by Capitalism. 
 Waste either in production, or management, or 
 transport, spells bankruptcy to the capitalist. 
 Here the charge lies rather against Collectivism, 
 for costly management is one of the besetting 
 
80 THE QUEST OF INDUSTRIAL PEACE 
 
 sins wherever the watchful superintendence 
 of Capitalism is withdrawn. It cannot be too 
 often pointed out that neither the production nor 
 the distribution of the product are as efficiently 
 carried on under Collectivism as under Capital- 
 ism. Would the milk supply, the sea-borne 
 traffic, the railway service be as promptly, as 
 regularly, and as courteously carried on as at 
 present ? Would the oversight and manage- 
 ment be as economically conducted ? Would 
 the lessened supply of transport, as is here 
 assumed, be to the advantage either of com- 
 merce, or of the public ? A third distinction 
 may be set in the statement that if the same 
 weight and variety of goods are to be carried, 
 the same number of passengers to be accommo- 
 dated, the same amount of cargo to be shipped, 
 the same amount of milk to be supplied, the 
 number of men employed, and the actual 
 manual labour needed cannot be lessened at all. 
 These are the ultimate questions in transport, 
 and they indicate that the elimination of com- 
 petition would rather increase than diminish 
 waste. 
 
 But the allegation turns to stress the 
 heightened cost in management, through com- 
 petition. Here again the charge is made 
 through ignorance. The cost of transport has 
 been shown to be a singularly small item in the 
 
THE INDICTMENT AGAINST CAPITALISM 81 
 
 price of goods, although somewhat large in 
 the carriage of passengers, because of their 
 demands for increasing comfort. The cost 
 of the management of transport is a decimal 
 figure of the whole. Take one decisive in- 
 stance. The cost of the carriage of fish, 
 including the charges for management, from 
 Aberdeen to London, amounts to no more 
 than three farthings a pound. It is the wages 
 bill for labour which enormously increases the 
 price. The labour of building and repairing 
 the boats, of keeping the nets in order, and of 
 catching and curing the fish absorbs the vastly 
 greater part of the price paid in the market. 
 But beyond such statistical proof the broad 
 truth is that management under Capitalism, 
 both in production and distribution, is less 
 wasteful than under any public board or State 
 department. One of the scandals of the 
 present day is the paralysing cost of the public 
 services. To reduce the superfluous staffs, or 
 to reach any moderation in the salaries paid to 
 the officials, seems to be almost impossible. 
 But the keen oversight of the capitaUst en- 
 sures that no labourer or. overseer is on the 
 pay sheet who is not required. His whole 
 interest is devoted to cheap production, and 
 the slacking, loitering, and malingering which 
 are universal features of bureaucratic control. 
 
82 THE QUEST OF INDUSTRIAL PEACE 
 
 are instantly checked. Beyond this truth of 
 the actual working of competition in making 
 for economic gain, there remain the obvious 
 facts that private management is more resource- 
 ful, more willing to make ventures, more eager 
 to expedite delivery, more instant in its service 
 of the consumer, and above all, more keen-eyed 
 in the discovery and prevention of waste. 
 
 n 
 The charge that competition is economically 
 wasteftd is being less publicly, or steadfastly, 
 urged. No one of the instances stands the 
 test of a close examination. As usual the 
 opponents of competition fall back on the 
 other feature of their indictment — ^that it is 
 morally wasteful. The contention is that com- 
 petition between capitalists tends to oppress 
 the labourer. It depresses wages because of 
 what Lasalle called ' the iron law of sub- 
 sistence,' by which he alB&rmed an inevitable 
 tendency of wages to fall to a level which 
 would keep the labourer alive, and no more. 
 That rhetorical Une has now been scored out 
 of the indictment. But it is still contended 
 that competition will always deny the labourer 
 the free and full Ufe which is his due, and will 
 grind him between the upper mill-stone of the 
 employer's greed and the nether mill-stone of 
 
THE INDICTMENT AGAINST CAPITALISM 83 
 
 the consumer's apathy. The conclusion is 
 that labour is both oppressed and depressed, 
 and that competition compels capital to com- 
 mit these wrongs. The final charge is that 
 competition may not waste wealth, but it 
 wastes men. 
 
 What is the truth about competition ? 
 There may be a competition which justly 
 suffers a moral condemnation. Many pages 
 of the statute book of the realm are filled with 
 enactments to regulate competition. The 
 Trades Union system has been organised to 
 check any self-willed practice. But the ambi- 
 tion to increase possessions on the part of men 
 or of nations, the impulse to excel a rival, and 
 the desire for pre-eminence are native passions 
 of the heart, and no law can prevent their 
 issue in competition. Yet in every passion 
 and every energy there is a low and base plane 
 of action, and there is a high and noble one. 
 Since competition is inevitable, so long as men 
 remain what they are, and cannot be eliminated 
 from any social or industrial order, the only 
 remedy from the evils which may be bred by 
 its exercise, is to purify the passions which 
 find their sphere of action in its expression. 
 
 One clear-sighted coUectivist has discerned 
 and faced this truth with candour. Mr. G. R. 
 Stirling Taylor in The Guild State (p. 93) writes 
 
84 THE QUEST OF INDUSTRIAL PEACE 
 
 in this decisive way. ' There were many brave 
 people amongst us who tried to prove, and 
 believe, that competition was altogether evil, 
 and that we could do without it. As a theory 
 for latter-day saints there was a great deal of 
 truth in our brave arguments. As a practice 
 for present-day sinners we were trying to bury 
 our heads in the sand. The gentle prick of 
 competition develops an energy in man.' This 
 is a wise and convincing correction of much 
 wild speaking and headlong writing. Mr. 
 Stirling Taylor sees that many of the diatribes 
 against competition draw lurid pictures that 
 are false to the facts, and that to-day com- 
 petition has only ' a gentle prick.' He reaUses 
 that many are not looking out with clear eyes 
 upon the world of industry, for, in his words, 
 they are burying their heads in the sand. He 
 does not pass on to the full and enriching gain 
 of competition. It not only develops energy, 
 as he asserts, but it imparts interest to life, and 
 zest to labour, and by enriching the mind and 
 quickening the spirit is an element in the 
 moral development of the race. Even were 
 the world to become the home of ' latter-day 
 saints ' they would require, and they would 
 rejoice in, the whole round of competition,, 
 but they would transmute it into a noble 
 emulation. They would not discard the pliant 
 
THE INDICTMENT AGAINST CAPITALISM 85 
 
 garment of competition for the straight jacket 
 of a limited endeavour. 
 
 The pregnant blessing of competition appears 
 in every sphere of human activity. The games 
 of life cannot be played with zest and their 
 achievements cannot be attained without com- 
 petition. Two youths strip for the hundred 
 yards sprint. Two county elevens pass out 
 to the cricket field. Two football teams stand, 
 ranged in due order, between the goals. Two 
 rowing crews await, tense, eager, confident, the 
 word of the starter. Two yachts, each em- 
 bodying a national patriotism, hover at the 
 starting point. Every nerve of the men 
 engaged in the contest is tingling with delight. 
 Every heart is thrilling with the passion to 
 excel. In the competition, patience, endurance, 
 courage, self-discipline, indeed the whole 
 development of manhood, are attained. 
 
 If public games seem to some only a part of 
 the idle play of life, into which competition 
 may be allowed to enter, let us consider some 
 of the highest achievements of human en- 
 deavour. Two choirs compete at a Musical 
 Festival. Two students enter the lists for a 
 scholarship. Two artists strain to receive the 
 recognition of the Royal Academy. There are 
 rewards to the successful competitor much to 
 be coveted. There is public applause and an 
 
86 THE QUEST OF INDUSTRIAL PEACE 
 
 endurinjg fame. There are substantial money 
 prizes. There is the prospect of a further 
 advance in skill and power and a personal 
 pre-eminence. All of these are the potent 
 dynamic which competition creates and fosters. 
 By the exercise of these quickened energies 
 skill is perfected, the world is enriched, and 
 the worker himself is gladdened and ennobled. 
 Who would condemn or banish such 
 competition ? 
 
 In the sphere of industry it is as inevitable, 
 as indispensable, and as salutary. Two 
 farmers compete with each other to place their 
 potatoes on the market in the first days of 
 summer. Two fishing fleets in the North Sea 
 scan the fitness of their equipment, watch 
 the signs of the weather, and keep note of 
 their distance from the port of dehvery, that 
 they may land their fish in time for the earliest 
 dispatch, and lay them first among the com- 
 petitors in the fish market. Two firms main- 
 tain a constant rivalry as to which shall pro- 
 duce the finest carpets, the most durable and 
 artistic tweeds, the most powerful engines, the 
 swiftest and most seaworthy ships. Life is 
 lived at its fullest under such conditions, and 
 these conditions can be attaiaed only under 
 Capitalism. 
 
 But it may be protested, although not 
 
THE INDICTMENT AGAINST CAPITALISM 87 
 
 accurately, that in all these aspects of com- 
 petition the ordinary man has been overlooked. 
 It is the man with the hammer in his hand 
 who is oppressed by any competition. Is 
 that accurate ? Every decent workman, 
 unless he is a sluggard and a shirker, has 
 an interest in the quality and serviceableness 
 of the products in whose manufacture he is 
 engaged. Every agricultural labourer, every 
 weaver, every fisherman, has his interest 
 aroused and his energy developed, and his 
 will disciplined by his share in skilful and 
 excelhng production. Ship carpenters and 
 engineers have confessed to the throb of 
 personal pride on the day when the ocean 
 liner, in whose building they had been engaged, 
 passed down the ways at her launching, and 
 sat at rest upon the water. They eagerly 
 declared that she was the finest ship of her 
 class afloat. There is much toil that cannot 
 fail to be monotonous. There is no escape 
 from drudgery. The man who sits at a desk, 
 cramped and chilled, with his muscles stiffened 
 and weary, has often wished he had a hammer 
 or a pick in his hand. But with him, as with 
 others, ' the gentle prick of competition ' has 
 given the stimulus he required. His passion 
 to excel has quenched the lower impulse of 
 his weariness. There may be an abuse of 
 
88 THE QUEST OF INDUSTRIAL PEACE 
 
 competition, as there may be an abuse of any- 
 thing else in the world, but it remains, and 
 shall remain, a moral force in the history of 
 the freedom and progress of humanity. The 
 controlling condition of lawful competition 
 is that competitors must ' play the game.' 
 That is what is required also in industry. 
 
 There is, however, one direction in which 
 we may look, and mark the moral degradation 
 of the labourer. That is to be foimd in the 
 laws and conditions imposed by Trades Unions 
 to check competition. The command that a 
 man shall lay only a few hundred bricks a day, 
 and all other similar limitations, degrade a 
 living, thinking, eager-minded man into a 
 machine. They rob him of his power of 
 initiative, diill his mind, and tame his spirit. 
 The willing acceptance of piecework and of 
 squad work, with their record of large output, 
 and the perfect willingness to work overtime, 
 are symptoms of the rebellion of manhood 
 against these cramping and limiting conditions. 
 It has been proved that since the miners had 
 begun to work on the new conditions of in- 
 creased payment for increased output, they 
 had become both healthier and happier men. 
 The element of competition had infused a new 
 joy into their work. It is open to conjecture 
 that one reason for the unhappiness in so many 
 
THE INDICTMENT AGAINST CAPITALISM 89 
 
 of the homes of labouring folk, for their jBock- 
 ing in thousands to football matches, and for 
 the indulgence in drinking bouts on the part 
 of those of weaker will, is due to these tram- 
 melling laws by which the workman has been 
 reduced to keep the pace of a machine. That 
 is not the only reason for this loss of personal 
 interest. But whether that be due to the 
 oppression of a capitalist, or the repression of 
 a Trades Union, there is urgent need of relief. 
 Whatever will quicken interest, develop energy, 
 and add to the zest of toil ought to be encour- 
 aged, and competition has its part to play 
 there. All the petty and selfish rules which 
 fence a man about in his daily work, prevent 
 the progress and evolution of the race. There 
 is an upward calling which the spirit hears and 
 responds to in freedom. His response may 
 cost him strain and toil, but the development 
 of his personality is attained in no other way. 
 Browning bids men ' strive, and never mind 
 the throe.' He describes, with his usual vivid- 
 ness, the degradation of those who try to 
 escape from the arena of struggle and contest, 
 and pictures them as cattle 
 
 ' Tame, in earth's paddock, as her prize.' 
 The Hebrew poet anticipated Browning when 
 he likened such men to ' the beasts that perish.' 
 Competition is a moral force. 
 
90 THE QUEST OF INDUSTRIAL PEACE 
 
 III 
 The fourth count in the indictment is that 
 Capitalism imposes serfdom on labour. Here 
 we rise into the sphere of morals. It has 
 become increasingly clear in these discussions, 
 that the real focus of appeal is in the moral 
 obligations. Here, then, the terms of the 
 indictment ring with protest. There are de- 
 clarations against the mean dependence, the 
 suppliant bearing, the lost manhood, and the 
 servile mind which Capitalism is said to im- 
 pose on labour. Rousseau's familiar sentence, 
 ' Man was bom free and yiet is everywhere in 
 chains ' is the weU-wom text of the opponents 
 of Capitalism. It was a heated saying in 
 Rousseau's dark day, and it is repeated as 
 though it had still the value of a steadfast 
 truth. This protest passes on to demand the 
 independence of the employee as against the 
 employer, the complete liberty of choice in 
 regard to conditions, with a consequent self- 
 respect. These demands consummate in the 
 declaration that no man shall have any obli- 
 gatory relationship in industry except to the 
 State, and the conclusion is that only under 
 that relationship can personality be developed 
 and ennobled. Without such altered con- 
 ditions Capitalism is said to impose what is 
 
THE INDICTMENT AGAINST CAPITALISM 91 
 
 termed, with an overdrawn rhetoric, ' serfdom ' 
 on labour. 
 
 The first question to ask in regard to these 
 allegations is — are they warranted by the facts ? 
 Is labour, under Capitalism, in serfdom ? 
 Are employers of labour tyrants ? Have they 
 power to deal with their workmen as their 
 selfish greed dictates ? Can they make rules 
 which limit the free conditions under which 
 any industry can be carried on ? Dare they 
 treat their workmen in a way which injures 
 their independence, or lessens their self-respect? 
 Have they power, or any means of exercising 
 a wilful power, over the opinions and actions 
 of their employees ? Can they, of their own 
 counsel, adopt and impose the methods, or 
 the hours of work, within their own gates ? 
 No one would attempt to affirm that any of 
 these statements represents the facts of the 
 case. 
 
 But there is a sphere where the charge of a 
 condition akin to serfdom does exist. The 
 action taken by Trades Union leaders in issu- 
 ing orders to their members, the happenings 
 which are universal in a labour strike, the 
 coercion exercised on so many unwilling workers 
 by those who are placed in power, present a 
 case where independence and manhood are 
 sacrificed. The numbers of men, who are 
 
92 THE QUEST OF INDUSTRIAL PEACE 
 
 compelled to strike and to suffer against their 
 will, who dare not utter one word of protest, 
 who have as little liberty as a gang of convicted 
 criminals at work under a warder, present true 
 instances of serfdom. The ' blackleg ' who 
 dare not attempt to approach the gate of a 
 shipbuilding yard in the exercise of his wUl, is 
 a serf indeed. More blameworthy still is the 
 fact of the large numbers who, technically 
 unskilled, are quite competent to attend some 
 machine, and yet are banned by the Trades 
 Union official when they beg leave to earn 
 their daily bread. A greater scandal is the 
 fiat which has gone forth against men becoming 
 ' trainees ' and, by a briefer apprenticeship, 
 becoming enrolled in the regular ranks. Even 
 men who have fought for their country's free- 
 dom, and have lost years of their Uves, have 
 made an vmsuccessful appeal against the 
 tyranny of the Trades Unions. These Trades 
 Unions have done great service in the past to 
 both capital and labour. In their recent 
 developments they have become oligarchies 
 which impose a distinct serfdom on labour, 
 both within their own ranks and without. 
 
 This broad indictment of serfdom tmder 
 Capitalism does not stand, and the charge is 
 stated, therefore, in a wiser and more careful 
 form. It is admitted that Capitalism does not 
 
THE INDICTMENT AGAINST CAPITALISM 93 
 
 make the working man ' a serf ' in the strict 
 sense of the term. That word, borrowed from 
 a past feudalism, was too ridiculous to be used 
 by men who claimed to be reasonable. The 
 new term ' wagery,' i.e. the receiving of a 
 weekly wage from an employer, is the basis of 
 the workman's enslavement. From some 
 writers one would gather that if the term 
 ' wage ' could be disused, for the term ' pay,' 
 or better still ' salary,' there would be no 
 degradation in receiving it. Others have 
 suggested that if the wage were given at longer 
 intervals, and without counting the days or 
 hours which are worked, as is the case with a 
 salary, it would become honourable. They 
 seem to be unaware that the grievances felt 
 by most salaried persons are that the intervals 
 of receipt are too long, and that too little 
 account is taken of hours and days, while over- 
 time has no place, or at least a very minor 
 place, in the scale of reward. 
 
 Why should there be any sense of degrada- 
 tion, any loss of self-respect, any conception 
 of enslavement in receiving wages ? The 
 writer knows all that needs to be known about 
 receiving wages, and he knows almost as much 
 about receiving a salary. He never felt any 
 degradation or enslavement, or loss of self- 
 respect, if only he felt sure that he had given 
 
94 THE QUEST OF INDUSTRIAL PEACE 
 
 a fair day's work for his wage, and had earned 
 his salary by diligence and fidelity. Why does 
 a trader have no feeling of dependence in 
 taking money across the counter ? Why does 
 a lawyer or a doctor, in taking a fee for 
 service, stand without being abashed or feel- 
 ing degraded ? Each has been paid what is 
 nothing more nor less — name it as one may— 
 than a wage. Why should a working man, 
 who has produced some article by the skill of 
 his hands, feel any loss of respect in receiving 
 a just reward for his labour ? There is one 
 Sphere of action in which this sense of degrada- 
 tion and lost self-respect and unrealised per- 
 sonality might be felt. When men with good 
 wages eat bread subsidised out of public taxes, 
 or bum coals at less than their cost of pro- 
 duction, or refuse to pay their rent when an 
 economic increase is demanded, and their 
 wages have risen in an even higher degree, 
 they ought to have a sense of degradation, and 
 they ought to suffer a lost self-respect. What 
 a man has earned he ought to receive, through 
 whatever channel it comes, as his right. He 
 ought to lose his independence if he is willing 
 to become, what would have been termed, two 
 generations ago, ' a pauper.' 
 
THE INDICTMENT AGAINST CAPITALISM 95 
 
 IV 
 
 Let us rise from this discussion of details, 
 and from these arguments against Capitahsm 
 which are no longer urged by the more experi- 
 enced and wiser coUectivists. Let us get down 
 to the ultimates behind this fourth count of 
 the indictment against Capitalism. One of 
 these ultimates is the belief that if one indi- 
 vidual works for another individual, and is 
 paid by him he is in a dependent, subservient, 
 and even menial condition. That is a totally 
 false idea of the relationships of life. At its 
 root it is a morbid egotism displaying itself 
 in a stupid and unworthy self-assertion. The 
 thought that if one gives ' social service,' as 
 it is called, he may escape this sense of depend- 
 ence, and may keep his self-respect, does not 
 face the actual conditions of service at all. To 
 consider that by giving out tickets at a booking- 
 office window, or going messages in a uniform 
 for a civic corporation, or carrying cakes in a 
 public tea-room ensures self-respect, is to 
 refuse to realise the truth. To go on to de- 
 clare that if one serves a captain of industry 
 in a shipbuilding yard, or a merchant in his 
 office or packing room, or the mistress of a 
 home in her house, he or she suffers degrada- 
 tion and approaches serfdom, is simply an 
 
96 THE QUEST OF INDUSTRIAL PEACE 
 
 inverted snobbery. Service is not only the 
 obligation, but the law of life. Only he who 
 serves is noble. The questions he should ask 
 are, not whom he serves, but whether he 
 serves in a cause of human need, and with the 
 utmost fidelity. This conception is not only 
 condemned by the law of life, but by the law 
 of Christ. The man who disdains to give those 
 services which minister to the whole round of 
 human needs, has never reahsed what is 
 highest and noblest in life. ' I am among you 
 as one that serveth,' said the noblest spirit 
 who ever walked in perfect freedom on our 
 earth, and He stooped to wash His disciples' 
 feet. At His feet to-day aU the world kneels. 
 When will men realise that there is no escape 
 from obedience and subordination on the part 
 of one man to another, under any possible 
 social or industrial order ? There must be 
 those in authority who give orders. There 
 must be those with oversight who direct the 
 actions of those who obey. There must be 
 those who have responsibility, and, therefore, 
 must make choices and decisions. It is some- 
 times urged that men would willingly obey 
 any one who had been elected by the workers 
 to a position of responsibility and authority. 
 It is difficult to understand why this thought 
 should be cherished, or why obedience to an 
 
THE INDICTMENT AGAINST CAPITALISM 97 
 
 authority so chosen, is honourable, but obedi- 
 ence to a master of industry degrades. The 
 experience of those who work for officials 
 affords no proof that thereby independence or 
 self-respect are attained. An official in a 
 public department, the manager of an under- 
 taking which is under civic control, the ruling 
 authority in any co-operative tmion, is always 
 more autocratic and less approachable than 
 the master of a large enterprise, whose interest 
 is bound up with the goodwill and the respect 
 of his workmen. Any one who has served 
 imder an ofl&cial in a State department, or 
 under an ofl&cer appointed by popular suffrage, 
 finds his personality unregarded, his mode of 
 life unheeded, except in so far as that may 
 impair his efficiency, and his unquestioning 
 service sternly demanded. He is little more 
 than a cog in the wheel. The only solution 
 for any infringement of a wage-earner's inde- 
 pendence or self-respect Hes in altered men, on 
 both sides of the service, and not in any 
 possible system. The wise-minded and well- 
 minded capitalists — and these men abound — 
 treat their workmen with a fairness, a con- 
 sideration, and a sympathy too httle recog- 
 nised. Most working men are aware that 
 they can rely upon their fair and impartial 
 decision when two branches of one industry 
 
 a 
 
98 THE QUEST OF INDUSTRIAL PEACE 
 
 disagree. The master understands the con- 
 ditions under which he must run his business. 
 He will not give any workman the slightest 
 reason for asserting that his personality will 
 be challenged or degraded, or his true liberty 
 curtailed. He is ever on the outlook to recog- 
 nise, to commend, and to reward ability and 
 integrity. The men who complain of depend- 
 ence, or degradation, or enslavement, are often 
 those who are the wilful inefficients on the roll. 
 These four counts in the indictment of 
 Capitalism are not supported by the evidence, 
 and are refuted by a patient review of the 
 conditions of any industrial order. Yet there 
 remain the wrongs which prevail. Labour 
 unrest has its causes, and these, so far as they 
 can be amended, demand instant dealing. 
 We must not, in fair thinking, cry down a 
 demand because it has been based on false 
 premises, and wilful conclusions. The claim 
 for a fair share of the good things of this present 
 life, for more security and leisure and comfort, 
 and for a fuller and freer and nobler life, as the 
 just portion of the masses of the people, must 
 be met. That new spirit, that quickened 
 conscience of which we have spoken, is rightly 
 sensitive to every accusation of wrong-doing, 
 whether on the part of CapitaUsm or of 
 Labour. Above all, it is keenly touched by 
 
THE INDICTMENT AGAINST CAPITALISM 99 
 
 any conviction of inequality which can be, 
 or ought to be, removed. But that does not 
 lead to, or justify, the assertion that Capital- 
 ism, as an economic and industrial order, is 
 the cause of these wrongs. Capitalism does 
 not necessarily issue in these imfaimesses and 
 inequalities. That is the root fallacy of 
 Collectivism. The evils of our present social 
 order are not due to the system of Capitalism. 
 They are the crimes of the capitaUst — and of 
 other men. 
 
VI 
 
 THE CRIMES OF THE CAPITALIST— 
 AND OF OTHER MEN 
 
 Capitalism has an economic justification and 
 yields supreme moral values. It supplies that 
 abundance of wealth which is the necessity of 
 a free and full and joyous life. It arouses 
 energy, stimulates initiative, and provokes in- 
 ventiveness and resource. It provides an in- 
 centive to ability and skill. Its elasticity of 
 method enables it to deal with the varied needs 
 of a complex civilisation. It adapts itself to 
 the intricate conditions of exchange, and pro- 
 vides the only known solution for the problems 
 of international economic intercourse. Its 
 moral values are seen in its maintenance of 
 personal liberty, its dependence upon individual 
 responsibility, and its appeal to imperative 
 motives. The fact that it ' grew ' and is no 
 artificial scheme of fantastic theorists is the 
 proof that it is consonant with human nature. 
 Its ideals may require to be purified ; its 
 methods to be amended ; its motives to be 
 ennobled. That is the truth of all things 
 
 100 
 
THE CRIMES OF THE CAPITALIST 101 
 
 -under the sun. But so long as human needs 
 remain what they are. Capitalism is justified by 
 economics. So long as human nature remains 
 what it is, Capitalism is justified by morals. 
 
 Yet there remain the wrongs so evident in 
 our social order. These wrongs, as we have 
 seen, are greatly lessened in this present time 
 and are being continually redressed. For these 
 wrongs are not evils necessarily bred by the 
 system of Capitalism— if so varied and elastic 
 a method can be called a system. They are the 
 growths from those roots of evil out of which 
 there spring most of the wrongs of life. In all 
 relationships, and in every organisation there are 
 the rude, the covetous, the envious, the venge- 
 ful. They infest a Trades Union as pitiably 
 as a Chamber of Conmierce or a University 
 Senate. The capitalist is not a sinner above 
 all men that are on the earth. Yet there is no 
 doubt but that there are capitalists who have 
 seized the opportunity, given them by their 
 possession of capital, to commit crimes which 
 ought to be denounced and punished. The 
 possession of power and of authority whether 
 of a capitalist, or of a labour leader and his 
 followers, always tempts to wrong. We shall, 
 therefore, consider the crimes of the capitalist. 
 But we shall not forget, as no man should forget, 
 that they are also the crimes of other men. 
 
102 THE QUEST OF INDUSTRIAL PEACE 
 
 I 
 
 The first crime is that the capitalist not only 
 seeks a profit but that he exacts an unjust 
 profit. The proof of this is usually drawn from 
 production. An article is given the appear- 
 ance of a strength and durability it does not 
 possess. Shoddy is manufactured and dressed 
 to pass for fresh and honest wear. A higher 
 price is demanded than yields a fair return for 
 the labour employed. Advantage is taken of 
 a rising market to fix a higher price on goods 
 which have been bought when a lower rate 
 prevailed. No doubt a certain allowance must 
 be made to cover the risk of a fall, but the large 
 increases can seldom be justified. They are a 
 species of theft. 
 
 Or again, the market may be ' cornered ' so 
 as to produce a false scarcity. Fish have been 
 thrown into the sea lest their abundance should 
 lower the price. Supplies of wheat have been 
 withheld so as to exact a ransom in their cost 
 to the consumer. Sugar has been delayed in 
 delivery for the purpose of increasing its price. 
 Land has been kept empty and idle in the 
 hope of an enormous increment. In another 
 direction men and women have been set to 
 work at ' sweated wages.' The pieceworker's 
 price has been meanly cut, because the em- 
 
THE CRIMES OF THE CAPITALIST 108 
 
 ployer thought he was making too large a 
 wage within the week. The attempt to intro- 
 duce a large number of apprentices, and the 
 proposal to employ ' diluted labour ' have 
 been opposed, partly because men realise that 
 the capitalist was using these methods of exact- 
 ing an unjust profit. These all are crimes. 
 During the European War these criminals had 
 their opportunity, and the word ' profiteer ' 
 was coined to stigmatise the wrong done not 
 only to the labourer, but to the community. 
 
 The same guilt can be proved in the area of 
 the distribution of wealth. When profits began 
 to rise many employers paid no spontaneous 
 heed to the wages of employees. They refused 
 to share their larger income with those who 
 were fellow workers with them. They met 
 every appeal either by a refusal, or by the 
 slightest possible increase. Companies have 
 paid an enormous dividend after every en- 
 deavour to disguise their profits by placing 
 a large sum to reserve and spending freely in 
 renewals, without considering the claim of 
 labour at all. Supply stores have enlarged 
 their premises and ' watered ' their stock and 
 yet kept their staffs at the lowest minimum 
 which they would accept. Mine-owners and 
 mining companies have prospered, but they 
 have seldom or never willingly shared their 
 
104 THE QUEST OF INDUSTRIAL PEACE 
 
 profits with their workers, and have yielded 
 only when in fear of violent reprisals. Farmers, 
 as is attested by the declaration of their estates 
 at death, have made fortmies while resisting 
 the demands of their ill-paid labourers. Had 
 capitalists been wise, and had they had regard 
 to their own interest, and still more had they 
 been moved to justice, they would have resisted 
 these temptations, and not been classed as they 
 must be among those who have committed 
 crimes both against labour and the community. 
 That these are just charges can be proved 
 in the simplest possible way. The only witness 
 one need call is the Chancellor of the Exchequer, 
 The graduated income tax — a tax every one 
 should pay— is based on the principle that one 
 man has a larger income than another. But 
 when the severe toU of death duties was im- 
 posed, and above all, when the expressly and 
 significantly named Excess Profits Tax was 
 instituted, there was set on the Statute Book 
 the declaration that great wealth had been 
 gained at what the conscience conceived to be 
 an unjust profit, i.e. a profit larger than should 
 have been taken. This is not the inevitable 
 result of Capitalism. There are capitalists 
 whose hands are clean. But there are many 
 more who have committed this crime of the 
 unjust profit. 
 
THE CRIMES OF THE CAPITALIST 105 
 
 II 
 The second crime of the capitaUst is heedless- 
 ness of the well-being of the labourer. He has 
 not asked, and has not cared to ask, about the 
 labourer's home. He has not inquired as to 
 whether comfort or cleanliness or decency 
 were possible within his narrow house. He has 
 not been ashamed that the sun could not shine 
 into the street where his workmen's children 
 played. As a class capitalists have taken 
 almost no account of the manner of life ob- 
 served by their employees when they left the 
 gates of their factories. Such friendly interest 
 is not so easy as it was in primitive days when 
 an employer had a few workmen with whom 
 he lived in social intimacy. But more ought 
 to have been done, and more can be done, 
 than to bestow a little patronage, or to give 
 a sympathetic subscription. It must not be 
 forgotten that the slum and the mean home 
 are not entirely due to the capitalist's lack of 
 interest and want of care. It seems impos- 
 sible for men who are living in the midst of 
 it to take due account of the improvidence 
 and sloth and drunkenness, which do more 
 to impoverish and degrade labour than any 
 neglect on the part of capital. In every con- 
 gested area there are homes whose shining 
 
106 THE QUEST OF INDUSTRIAL PEACE 
 
 windows, bright firesides, and clean thresholds 
 form the index of a life of high purpose 
 in an atmosphere of purity and peace. Yet 
 this does not exonerate the capitalist from 
 that heedlessness to the well-being of the 
 labourer which has been one great cause of his 
 degradation, as it is one source of his bitterness 
 of spirit. 
 
 This heedless apathy and selfish neglect are 
 not universal. There are names justly 
 honoured because, when riches have increased, 
 they have set their hearts on the well-being 
 of men. It is the eternal praise of Robert 
 Owen that in his successful and happy capitalist 
 days, he made the well-being of his workers 
 his primary aim. Like every other man who 
 has followed the same ideal, wealth also was 
 attained. In modern days a visit to Boume- 
 ville, or to Port Simlight, would exhibit the 
 same truth. A study of the methods of the 
 Cleveland (Ohio) Garment Manufacturers' 
 Association would convince the most hardened 
 of the wisdom of caring for men's well-being. 
 (C/. Samuel Crowther, The World's Work, 
 September 1920.) To go farther afield, a 
 visit to the Buckingham and Gametic Mills 
 in Madras would persuade the most unwilUng 
 that a care for the well-being of the worker is 
 burdened with blessing. The numbers of men 
 
THE CRIMES OF THE CAPITALIST 107 
 
 who wait at the gate eager for employment under 
 so wise and humanitarian management are the 
 sufficient proof of its many-sided wisdom. 
 
 How rare is this course of conduct I How 
 common is the crime ! John Stuart Mill, 
 Ricardo, Bastiat, and Malthus uttered their 
 warnings. It was the burden of Ruskin's 
 pathetic indignation and of Carlyle's fiercest 
 scorn. Charles Dickens and Charles Reade 
 set both the criminal and the man he had 
 wronged upon the stage. To-day it is the 
 angry passion in the hearts of many who have 
 been moved to more than protest. One of 
 the leaders of the socialistic movement re- 
 ferred, on every occasion on which the writer 
 heard him speak, to the experience which made 
 him a socialist. When a boy of twelve years 
 of age he served a shopkeeper whose premises 
 he opened in the early morning. After an 
 hour of wearying labour he attended his master 
 in his home to receive the orders for the day. 
 He went into a breakfast-room, found the 
 family gathered round a well-stored table, 
 while he stood hungry and shivering. That 
 sent a current of bitterness through his blood 
 which never ceased to flow. The boy resented 
 the master's heedlessness of his widowed 
 mother and himself. That is one of the crimes 
 of the capitalist. 
 
108 THE QUEST OF INDUSTRIAL PEACE 
 
 The blackest line in this charge is to be 
 found in the capitalist's frequent and ignorant 
 neglect of the out-of-work labourer. When 
 the country is passing through a period of dull 
 trade, or when the manager of some large 
 enterprise finds that his stocks are too heavy, 
 the labourers are discharged. Even when 
 they are of saving habit this discharge brings 
 hardship. When they spend, as they have 
 been doing, almost every penny they earned, 
 they hear the baying of the w^olf at their door. 
 Some capitalists are wise enough to give 
 partial employment, and others have been 
 known to keep their furnaces and their factories 
 in operation at a loss. But many employers 
 have no care as to the labourer's home, or 
 the well-being of his family. As a conse- 
 quence many men and women become a prey 
 to evil habits. They nourish a dark-minded 
 and even venomous ill-will. They feel that, 
 having made their contribution to their 
 employer's well-being, he ought not to be 
 neglectful of theirs. This evil has been so 
 great in time past that the State has been 
 compelled to step in and, with an endeavour 
 after impartial justice, has compelled both 
 capital and labour to contribute a share of 
 relief. The Health Insurance Act and the 
 Unemployment Insurance Act are evidences. 
 
THE CRIMES OF THE CAPITALIST 109 
 
 as they are confessions, that a wrong done by 
 the capitahst must be remedied by a preventive 
 law. What an opportunity has been missed ! 
 It would have been a means of sweetening the 
 atmosphere of society, of uplifting humanity, 
 as well as of unspeakable blessing to himself, 
 if the capitalist had been mindful of the well- 
 being of the labourer. He would have ful- 
 filled that counsel of Christ, enshrined in the 
 parable of the vineyard, when He gave the 
 penny not only to those who had justly earned 
 it, but to those who, though willing to work, 
 had given only one hour of the day. 
 
 in 
 The third crime of the capitalist is not the 
 possession of wealth but its spending in selfish 
 indulgence. If wealth were modestly possessed 
 and wisely used, and, above aU, if it were spent 
 in the furtherance of moral ends, not only 
 would envy and greed be exorcised from men's 
 hearts, but the man of wealth would become 
 a man of noble character. Few object to a 
 man's prosperity in the things of this life if 
 that be gained through his skill, industry, and 
 foresight. The average honest working man 
 who spends his strength in the use of his tools 
 is aware of the toil and strain, the resource 
 and watchfulness which his employer contri- 
 
110 THE QUEST OF INDUSTRIAL PEACE 
 
 butes. He recognises that any man who has 
 a difficult and hazardous occupation— whether 
 that be hazardous to his health of body or 
 peace of mind — ^is entitled to a higher reward 
 than the man who has a ' soft job,' or one which 
 merely strains his muscles. Consequently a com- 
 petent captain of industry, it is recognised, may 
 earn and possess wealth which a slacker and 
 shirker has not earned, and should not possess. 
 But if wealth, however gained, is squandered 
 in selfish indulgence, a just condemnation 
 follows. It is here that there is presented the 
 vexing contrast between man and man. The 
 first question always is — ^Why should one man 
 lie soft and suck the sweets of life, and another 
 man endure hardness ? Why should one man 
 waste wealth in display, and in the gratifica- 
 tion of appetite, when another man has to 
 practise the most rigid economy ? This first 
 question leads on to the second, as to whether 
 any man has a right to spend at the bidding 
 of a selfish wilfulness. Even those who remem- 
 ber that ' a man's life consisteth not in the 
 abundance of the things which he possesseth ' 
 are roused to a moral indignation against all 
 self-indulgent spending. But to men who be- 
 lieve that a rich and free and full life is depend- 
 ent on self-indulgent spending the sight of the 
 capitalist adorning his women folk with costly 
 
THE CRIMES OF THE CAPITALIST 111 
 
 attire makes them flame with indignation. 
 The weekly journals, which are little more than 
 pages of fashion plates, the costly entertain- 
 ments which entail a wasteful and vulgar 
 display, the elaborate country houses with 
 all their attendant luxuries and their some- 
 what selfish desertion of the masses emphasise 
 the disparities. As a consequence they have 
 no hesitation in counting this self-indulgent 
 spending as the supreme crime of the capitalist. 
 It is not too much to say that if the capitalist 
 would use his possessions for the great causes 
 of life, and would spend his surplus wealth in 
 a wise and measured method, the charge 
 against him would lose its bitterness, and even 
 its point. But looking broadly out upon 
 society no one can deny but that many capital- 
 ists sin not only against labour, but against 
 society, and against their own souls. 
 
 IV 
 
 If these be the crimes of capitalists they are 
 the crimes of other men, and especially of 
 labour. When labour adopts the ' ca' canny ' 
 policy it is as criminal as capital.'^ This policy 
 has been motived sometimes by the fear of 
 
 1 This Scottish term should be written ' Caw canny.' To caw is 
 to turn a wheel. Canny means slowly, cautiously. The figure of 
 a man wilfully turning a wheel slowly and cautiously is a perfect 
 one for a slacker in labour. 
 
112 THE QUEST OF INDUSTRIAL PEACE 
 
 being overdriven — a needless fear to-day. It 
 has been practised for the seemingly generous 
 purpose of making the work go round a larger 
 number of men, or for the less honourable 
 desire of keeping a job going as long as possible. 
 It has been defended as a shrewd method of 
 limiting profits, under the conception that if 
 more goods are produced profits are increased. 
 All these have both an economic and a moral 
 condemnation. If too much time is taken to 
 produce an article its cost is increased. In 
 that event the consiuner is exploited, less is 
 bought of the article produced, work becomes 
 scarce, and the labourer not only pays more 
 for his own supply, but lessens the demand for 
 his labour. Abundant production does not 
 increase the capitalist's profits, xmless he can 
 be sure of a market. With abundant produc- 
 tion the market becomes stocked, but the price 
 falls,! T(vhile, consequently, demand increases 
 and sales are greater. So that the ' ca' canny ' 
 policy impoverishes both the producer and the 
 consumer, and is one of the factors which is 
 
 ' Under-consumption, not over-production, due to soaring 
 prices, or to stagnation of industry through war or famine or 
 speculation, or the caprices of taste and fashion, is the true cause 
 of a glutted market. Who ever knew of an over-supply of the 
 necessities of life and comfort, unless in the case of some such 
 exceptional and accidental circumstance as an enormous catch of 
 herrings or a sudden ripening of perishahle fruits? Let a ware- 
 house advertise a thirty per cent, reduction in prices and its 
 counters are thronged, even in hard times. 
 
THE CRIMES OF THE CAPITALIST 118 
 
 producing the unemployment of to-day. To 
 use the common proverb, the worker is cutting 
 off his nose to spite his face. 
 
 Let us take a few simple instances in proof. 
 The price of clothing and of footwear went up 
 enormously after the war. Consumers wore 
 their garments and their shoes longer, and 
 were content to have articles they would once 
 have discarded renewed and repaired until 
 tailors and bootmakers were going idle. The 
 milk producers endeavoured to increase the 
 price of milk. But thousands of gallons were 
 left to become sour at the railway stations. 
 In the building trade, where only three hundred 
 bricks a day were laid, and where the slacking 
 when men were employed by day labour 
 was a scandal, the cost of housing has risen 
 until the cry of the homeless is pitiable. This 
 is largely due to this brainless policy of '<;a' 
 canny.' But it is even more worthy of a 
 moral condemnation. Men who condenm the 
 capitalist because he works for profit, as they 
 affirm, and not for use, seem unable to under- 
 stand that the labourer is guilty of the same 
 crime in the most distinctive way. The man 
 who declaims against the capitahst because 
 he charges more than he should, who flushes 
 with anger if a provision dealer, by the skilful 
 use of ' the grocer's thumb,' gives him fifteen 
 
114 THE QUEST OF INDUSTRIAL PEACE 
 
 ounces for a pound, or a linen draper, whose 
 yard stick measured only thirty inches, wiU 
 yet complacently ' ca' canny ' and fail to see 
 that he is standing in the dock beside the dis- 
 honourable capitalist. The labourer is worthy 
 of his hire, as the capitalist is worthy of his 
 reward. But if the labourer does not give 
 honest value for his hire, his hire is robbery. 
 If the reply be made, as Mr. Cole makes it, 
 that because of the crime of the capitalist, no 
 one ' has the right ' to make an appeal to the 
 labourer, the answer to that moral obliquity is 
 that, although one man is a thief, another is 
 not given the right to steal. Labour is com- 
 mitting the same crime as the capitalist. It 
 has done so from the first wicked and slothful 
 servant, and it wiU do so as long as men are 
 found who wiU be wicked and slothful. 
 
 But, again, to take the second charge, 
 labour is as much intent on its own wealth and 
 as heedless of the well-being of others, and, 
 especially of the employer, as capital. The 
 incessant demand for higher wages without 
 regard to the question as to whether the higher 
 wage can be paid ; the insistence of one trade 
 for an increased return for its labour apart 
 from the well-being of other trades ; the 
 lightning strike to enforce a demand, which 
 may not only impoverish a capitalist, but 
 starve a whole community, is surely as black 
 
THE CRIMES OF THE CAPITALIST 115 
 
 a record of crime as any that the capitalist has 
 ever committed. When it is accompanied by 
 a refusal to submit the claim of a higher wage 
 to an impartial tribunal, there is surely an 
 added wrong to the first selfish offence. Or 
 when labour is guilty of shirking, or of slacking, 
 or of dealing wastefuUy with the goods or the 
 tools committed to its care, there is again 
 an accusation of wrong to be made. The 
 three charges made against labour by Jesus 
 were disloyalty, wastefulness, and sloth. Even 
 when the labourer thought that he served ' an 
 hard master ' Jesus gave him no warrant for 
 retaliating by committing a crime against the 
 master. Here again, if we have high words 
 for the crime of the capitalist, we ought not 
 to allow the labourer to escape as just a 
 condemnation. 
 
 In the third accusation the capitalist has 
 also his companion in crime. The labouring 
 man with a margin above his daily wants is as 
 guilty of self-indulgence as the man of means. 
 Those who belong to ' the new poor ' have 
 this impressed upon them every day. A walk 
 along a great thoroughfare, where industry 
 spends its gains, creates an increasing amaze- 
 ment. Costly provisions, rich and rare fruits, 
 expensive confections, and the daintiest 
 luxuries from the ends of the earth are freely 
 purchased. The makers of furs and of ex- 
 
116 THE QUEST OF INDUSTRIAL PEACE 
 
 travagant footwear find that the prices of theii 
 goods are seldom questioned. The costliest 
 of all articles of consumption — alcohol — ^is freely 
 bought, and lavishly used. One item of ex- 
 penditure which is spared and grudged is rent, 
 and another, which is taxes, is paid almost 
 with a protest. The sum spent in eating and 
 drinking, in holiday excursions, motor drives, 
 and picture palaces has reached, in cases which 
 are without number, the cost of three days' 
 wages. 
 
 The average socialist seems to be unaware 
 of these wasteful and self-indulgent spendings 
 on the part of labour. He continues to make 
 the plea that those who toil with their hands 
 are still deprived of the necessities and com- 
 forts of life. One writer declares that 'the 
 family income is far short of the family require- 
 ments,' and can add that ' under CapitaUsm 
 the physical pleasure of a good meal, served 
 under proper conditions, is not possible to the 
 working man.' One wonders where he lives, 
 and whether he keeps his eyes open to the facts 
 of the case. If he is aware of these self-indul- 
 gent spendings he seems vmable to reahse that 
 they are precisely the crime of the capitalist 
 repeated by labour. No man is willing to pass 
 any severe condemnation upon another man's 
 spending so long as he harms no one by it, and 
 will take the consequences of his liberty. It 
 
THE CRIMES OF THE CAPITALIST 117 
 
 may be regarded as imprudent, and as showing 
 a want of foresight and of self-control. It 
 would be impossible under the regimen of a 
 socialistic system which would weigh out every 
 commodity in its own scale. But if such 
 imprudent and selfish spending is one of the 
 crimes of the capitalist, it is equally a crime 
 on the part of other men. 
 
 V 
 
 The vital question that remains is the pre- 
 vention of these social, economic and industrial 
 crimes. There are three methods which are sug- 
 gested, and each has its own advocate. One is 
 the abolition of Capitalism. In this demand 
 many Socialists are thorough-going. They would 
 abolish all forms of private ownership. Others 
 wish to sweep away the large capitalist, with 
 his supporter, the dividend-receiver. Others 
 seem to suggest a certain datum line below 
 which the possession of private property would 
 be allowed. Others seem to desire that some 
 industries should be imder State control, but 
 others might be left — and especially agricul- 
 ture — ^to private ownership and management. 
 The demand for abolition is supported by the 
 plea that it is the system, not the capitalist, 
 who is to blame. One writer declares, ' They 
 consider that the capitalist is as much the 
 victim of his system as the unemployed, and 
 
118 THE QUEST OF INDUSTRIAL PEACE 
 
 that he has to conform to its evil pressure in 
 the same way as the poverty-stricken have to 
 do. The results are not the same, but they 
 are products of the same social mechanism.' 
 This talk of a man being a ' victim ' of a system 
 woiJd excuse Caiaphas and Pilate, and pardon 
 every pope and peer who has fostered a gross 
 wrong. It denies moral responsibility, and it 
 affirms that in a sphere of life, where wrongs 
 are abundantly evident, the wrong-doer is 
 not to be blamed. The foimtains of self-deceit 
 are deep, and both the capitalist and his neigh- 
 bour may not see themselves as they are, but 
 no man can be allowed to declare that the 
 employer, when driven by greed or ambition, 
 or stress of competition, who oppresses his 
 employee, can be called a ' victim.' If there 
 be a wrong done by one man to another, 
 through whatever system or agency, the 
 wrong-doer is to be condemned. There is no 
 ' system ' which will purge greed and envy 
 and supercilious contempt out of men's hearts. 
 The man who would abolish Capitalism to put 
 Collectivism in its place, whether under the 
 control of the State or of a trade bureaucracy, 
 would find that the pride and cvmning of men 
 can devise means, under any system, of attain- 
 ing their own private advantage, personal 
 pre-eminence and dominating power. These 
 are real grievances, but they cannot be remedied 
 
THE CRIMES OF THE CAPITALIST 119 
 
 by the abolition of the capitaUst. Yet it is 
 easy to predict that every penny of unjust 
 profit, and every day of selfish rule, shall be 
 either exacted or wasted in a day of reprisal 
 and retaliation. And it can equally be affirmed 
 that any action on the part of labour designed 
 to attain its own material advantage, will issue 
 in its impoverishment and the narrowing and 
 embittering of the lives of working folk. 
 
 The second method is the policing of the 
 capitalist. That is the method sanctioned 
 throughout the whole civilised world. Among 
 all the nations of Christendom, there has been 
 a steady progress of the movement towards 
 the control of the capitalist in order to attain 
 the amelioration of the conditions of life among 
 the people, and to secure a larger share of the 
 wealth of the world as their portion. The 
 time and the energy of the parliaments of the 
 nations have been absorbed in framing laws 
 which deal with hours of labour and the sharing 
 of the profits. They have grappled with the 
 more intricate problems of the health, the 
 unemployment, and the old age of the labourer. 
 It is a conviction of the modern mind that the 
 policing of capital is a primary and urgent 
 obligation of government. In the articles of 
 the League of Nations formed at the close of 
 the European War, the thirteenth deals dis- 
 tinctively with the duty and the method of 
 
120 THE QUEST OF INDUSTRIAL PEACE 
 
 policing the capitalist. The principles and 
 the ideals to be kept in view have been given 
 a clear statement in the Covenant of the 
 League. It has become part of the common 
 consciousness, so that any act of oppression 
 on the part of an employer, or any excess 
 profit on the goods he supplies, or any dis- 
 regard of the rights of the community, is 
 visited with severe penalty, while the whole 
 trend of taxation is directed towards the 
 limiting of his gains and his privileges. The 
 average opinion of to-day would go farther, 
 and will doubtless demand the policing of the 
 labourer, as well as of the capitalist. The 
 men who will not allow another man freedom 
 in his work, who will prevent those who en- 
 deavour to preserve the mines during the time 
 of strike, who refuse to allow dumb animals to 
 be rescued from destruction, not to speak of 
 other and more deliberate breaches of civilised 
 law, have given proof that the policing both 
 of the capitalist and the labourer must remain 
 an obligation of the State. 
 
 With this conclusion every one, except it 
 may be a supporter of Anarchism, will agree. 
 In private life it is never questioned. No one 
 proposes to abolish the magistrate and the 
 policeman. No one refuses to put a lock on 
 his door or a snib on his window. No trader 
 
THE CRIMES OF THE CAPITALIST 121 
 
 will dispense with his cash register, and no 
 one proposes to disband the guardians of the 
 city's order and security. Yet every man 
 realises that something more is required than 
 the power of the magistrate and the edict of 
 the law. Those who have looked thoughtfully 
 into all that policing implies are aware that no 
 policing can prevent wrong, unless and until 
 it is the expression of the moral consciousness 
 of the people. As Canon Barnett has said, 
 ' After all it is the spirit which is in the people, 
 and not the law, which is the most important. 
 If, as has been said, every one were Christian, 
 there would be no need of Socialism ; and until 
 every one is Christian, Sociahsm will be 
 impossible' {Life, vol. ii. page 272). Every 
 one will endorse this wise statement, and agree 
 with that other pronouncement of this brave 
 spirit, ' I am a Socialist in so far as I desire 
 for every one equality of opportunity, an equal 
 chance of a healthy life, and of enjoying the 
 best gifts to this age.' The questions of the 
 abolition of the capitalist and of the policing 
 of both capital and labour would have no 
 moment, if only righteousness and mercy had 
 become the ruling passion of both the man who 
 is in authority and the man who is under it. 
 They would walk together in a way of peace. 
 
VII 
 
 UTOPIAN COMMUNISM 
 
 The demand for the abolition of Capitalism 
 has usually been fashioned into the more posi- 
 tive propagandism of some form of Collectivism. 
 Most frequently that demand has been little 
 more than a protest and demmciation of 
 evident evils without any practical proposals 
 for their remedy. But ever and again some 
 dominating mind has attempted to outline 
 a method or system of Collectivism in which 
 the ideal would be reahsed. The first of these, 
 both historically and logically, is Utopian 
 Communism. 
 
 I 
 The term Communism is used in its strictest 
 meaning, not as an alternative term for Col- 
 lectivism. Communism may be defined as 
 an ideally constituted society composed of 
 individuals who have consented to Uve and 
 work together, and to share with each other 
 the produce of their collected capital and 
 common labour— on an agreed basis. It is 
 
 122 
 
UTOPIAN COMMUNISM 123 
 
 the basis which has differentiated one com- 
 mune from another. That basis has some- 
 times been reUgious, as in the instance of the 
 imperfect and short-hved Communism of the 
 early Christian Church. ' The multitude of 
 them that believed were of one heart and of one 
 soul : neither said any of them that ought of 
 the things which he possessed was his own; but 
 they had all things conmion ' (Acts iv. 32). At 
 other times the basis has been civic, as with 
 those communal cities of mediaeval Europe 
 when the traders combined to establish guilds 
 into whose number only citizens were admitted. 
 Sometimes the basis has been political, as in 
 the case of the short-lived Paris commune of 
 1870. In more modern days the agreed basis 
 has been almost entirely economic, with an 
 occasional blend of other ideals. Utopian 
 Communism was based on the ground of its 
 economic justice. 
 
 This conception has fascinated many of the 
 noblest minds and inspired an arresting litera- 
 ture. Plato in the Republic and in the Laws, 
 outlined the first draft of the Utopian com- 
 mune. His unit was a small state, such as he 
 saw in a Greek city, and his ideal was the 
 equality of social condition, and, therefore, 
 of education and intercourse among its citizens. 
 His commune was placed under the care of 
 
124 THE QUEST OF INDUSTRIAL PEACE 
 
 ' guardians ' and affirmed a common owner- 
 ship of possessions and a common distribution 
 of the product. He solved the sexual relation- 
 ship with a rigorous Pagan logic by including 
 the woman under the possessions of the man. 
 He is the intellectual ancestor of all those 
 Socialists who have risen above a merely 
 economic demand, and writers of the Ruskin 
 school eagerly confess their debt to him. 
 
 A long interval of many hundred years passes 
 before another remarkable attempt to visualise 
 a commune was made. That may have been 
 due to the fact that during the predominance 
 of Rome in Church history the religious Orders, 
 with their monasteries and convents which 
 fascinated sympathetic minds, afforded them 
 the opportunity of practising the communistic 
 life. It was, therefore, amidst the storm of 
 the Reformation that Sir Thomas More (1478- 
 1535) wrote his Utopia. The word means 
 Nowhere, and reveals the fact that More, 
 with his sturdy good sense, knew that he was 
 building a castle in the air. In Utopia all 
 possessions are held in common, and the 
 results of productive labour in which every one 
 must share, are distributed not equally, but 
 equitably. There would be no need of money, 
 and its use is forbidden. Social classes would 
 pass away, and all intercourse be maintained 
 
UTOPIAN COMMUNISM 125 
 
 on one level of status, marked by the fact 
 that all meals would be taken in common. 
 More was not an economist, and never even 
 raised the questions involved in successful 
 production. He was intent on a distribution 
 which would not excite envy or provoke pro- 
 test. Two features of his ideal life show how 
 widely he differed from the majority of Com- 
 munists. He maintained the sacredness of the 
 marriage relationship and refused to allow a 
 community of wives, but he left unsolved the 
 problems which arise in connection with the 
 maintenance of the family. A stranger dis- 
 crepancy is his stipulation of a class of slaves 
 ' to render all the uneasy and sordid services,' 
 that is, the dirty and disagreeable work of the 
 community. Here More confesses that two 
 of the inexorable problems of a social order 
 remain unsolved in Utopia. His lasting fame 
 is due to a wise discontent with the depressed 
 condition of the common folk of his time, a 
 far-seeing conception of the value of education, 
 the necessity of sanitary reforms, and a lessen- 
 ing of the hours of labour for the toiling people 
 of the time. 
 
 Plato's Republic and More's Utopia are the 
 prototypes of a long succession of similar works 
 of imagination. Among these we may mention 
 Campanella's (1568-1639) City of the Sun, 
 
126 THE QUEST OF INDUSTRIAL PEACE 
 
 Bacon's (1561-1626) Nova Atlantis, Harring- 
 ton's (1611-1677) Oceana, Fenelon's Voyage 
 dans Vile des Plaisirs ; in more modem days 
 Morris's (1894-1936) News from Nowhere, 
 Bellamy's (1850-1898) Looking Backward, and 
 Blatchford's Merrie England, published in 
 1894. These are all interesting as fiction and 
 suggestive as forecasts, but they are out of 
 touch with present-day problems, and make 
 no contribution toward their solution. 
 
 II 
 Utopian Communism remained a succession 
 of dreams without any attempt to realise it. 
 The two revolutions, industrial and political, 
 at the close of the eighteenth century gave it 
 a new opportimity. The industrial revolution 
 created the crowded populations with their 
 misery of condition, squalor of habitation, and 
 consequent moral degradation, and these 
 aroused the sympathy of all with respect 
 for manhood. The poli':ical revolution, with 
 its watchwords— Liberty, Equality, Fraternity 
 —aroused latent forces of compassion and of 
 desire for the well-being of the toiling masses, 
 and quickened both purpose and hope for 
 their amelioration. One result of this altered 
 arena and changed mind was to be seen in 
 the measures of social and political reform 
 
UTOPIAN COMMUNISM 127 
 
 inaugurated in every country of western 
 Europe. In England there were movements, 
 sometimes purely political, sometimes philan- 
 thropic, which were aimed at relieving the 
 oppression and depression of the working 
 classes, and the opening of a wider opportunity 
 to the workers and their children. The 
 Chartist movement and Christian Socialism 
 were two symptoms of the quickened con- 
 science and the new desire for the uplifting 
 of the depressed classes and the amelioration 
 of their industrial condition. But the most 
 distinct outcome was the demand for a new 
 social order, and that demand was expressed 
 in Utopian Commimism. The names of those 
 associated in these experiments are many, but 
 three stand out as representatives of different 
 phases of its ideal. These three are St. Simon, 
 born in Paris in 1760 ; Fran9ois Charles 
 Fourier, born in Besangon in 1772 ; Robert 
 Owen, born at Newtown, Montgomeryshire, 
 North Wales, in 1771. 
 
 St. Simon advocated a Communism which 
 was timid and undiscriminating. He was not 
 a systematic thinker, and he had not daring 
 enough to outline a definite and thorough- 
 going system. He was concerned chiefly with 
 the betterment of the poor. His aim, expressed 
 in a statement which became the watchword 
 
128 THE QUEST OF INDUSTRIAL PEACE 
 
 of his followers, is clear. ' The whole of 
 society ought to strive towards the ameliora- 
 tion of the moral and physical existence of the 
 poorest class. Society ought to organise itself 
 in the way best adapted for attaining this end.' 
 He demanded the ' reorganisation of society 
 in the interests of the depressed classes by the 
 power of the State.' He was not much moved 
 by the sense of disparity between the rich and 
 the poor, for he was concerned not to despoil 
 the rich but to enrich the poor. He took no 
 part in any conflict between capital and 
 labour. He was a deeply religious man, and 
 was moved to protest against the entrenched, 
 exclusive, and heedless Christianity of his 
 time. His disciples, moved and inspired by 
 his appeal for social service and the better- 
 ment of the poor, established a society in 
 Paris to express and reaUse his aim. This 
 society had a common purse, lived in brotherly 
 social intercourse, and, as they were all culti- 
 vated and intellectual people, took up a Fabian 
 attitude toward the social problems of the day. 
 It had a brief and troubled existence, for it 
 never faced the practical conditions of life in 
 a world of stern reahties. It was finally broken 
 up by two dissensions. St. Simon taught a 
 doctrine of subordination to authority derived 
 from his inherited Roman Catholicism. But 
 
UTOPIAN COMMUNISM 129 
 
 the new wine of his teaching had made men 
 heady and assertive, and they refused to yield 
 such submission. The second dissension was 
 created by his insistence on a strict view of 
 the relationship to the sexes. St. Simon con- 
 tinued to hold the high doctrine of the Church 
 of Rome in regard to marriage and chastity. 
 His more loyal disciples adhered, but those 
 dissented to whom the commune was more 
 than the family. Historically the Utopian 
 Communism of St. Simon is merely an interest- 
 ing but hopeless experiment. 
 
 Fourier was a communist with more definite 
 ideals. He advocated the formation of what 
 he named a phalange, composed of about 
 four hundred families, with the aim of an 
 establishment of two thousand souls. This 
 estabhshment was called the phalanstere. The 
 staple industry was agriculture, and each 
 phalange had a portion of land allotted to its 
 members for cultivation. Every worker could 
 choose his own employment and might pass 
 on from one task to another by giving due 
 notice. He solved the troublesome problem 
 of the doing of the dirty work of the com- 
 munity by declaring that some had a natural 
 aflfinity, indeed a fondness, for ' cleaning up,' 
 and they would willingly discharge the func- 
 tions of the scavenger ! He did not believe 
 
180 THE QUEST OF INDUSTRIAL PEACE 
 
 in a dead level of possessions, for he posited, 
 as some more modern Socialists do, a minimum 
 of subsistence to every member, with a further 
 distribution to men with capital and with 
 gifts, who would be willing to labour. He 
 attempted to solve the problem of sex and the 
 family by abolishing marriage, and relying 
 entirely on the free exercise of sexual passion 
 to lead finally to a state of harmonious relation- 
 ship between woman and man. 
 
 Only two phalanst^res were established in 
 France, and only one of them during Fourier's 
 lifetime. Both were short-lived, and when 
 they broke up their promoters reclaimed from 
 any further advocacy of Utopian Communism. 
 But Fourierism caught the imagination of 
 many in the United States of America, and 
 several attempts were made, with important 
 modifications, to estabUsh settlements based 
 on Fourier's system. The abimdance of cheap 
 land, the adventurous spirit of men in the 
 new commimity, and the practical genius 
 of the people favoured such experiments and 
 over forty establishments were founded. Of 
 these only two are interesting. 
 
 The settlement at Brook Farm was organised 
 in 1841. Its aim was to gather into one com- 
 munity a number of educated and intellectual 
 men and women who held transcendental views 
 
UTOPIAN COMMUNISM 131 
 
 of human nature and romantic ideals of human 
 life. A tract of land was taken in West 
 Roxbury, Massachusetts. The statement of 
 its object reveals its fine idealism. ' To ensure 
 a more natural union between intellectual and 
 manual labour than now exists ; to combine 
 the thinker and worker, as far as possible in 
 the same individual ; to guarantee the highest 
 mental freedom, and to do away with the 
 necessity of menial services ; and to prepare a 
 society of liberal, intelhgent and cultivated 
 persons whose relationship to each other would 
 permit of a more simple and wholesome life 
 than can be led amid the pressure of our com- 
 petitive institutions.' The Brook Farm Settle- 
 ment is famed for the number of outstanding 
 literary men who joined it. While it may be 
 open to the charge of a certain exclusiveness 
 and, therefore, of affording no fair test of 
 Communism, yet, if ever a community was 
 given materiel in the character of those who 
 composed it which would secure its success, 
 that was found at Brook Farm. It proved 
 utterly unworkable. As Emerson is reported 
 to have said, in a sentence which some modem 
 writers should remember, ' He who will write, 
 must not dig.' The settlement passed into 
 a completely Fourieristic industrial phalange. 
 But after a further six years' experiment, the 
 
132 THE QUEST OF INDUSTRIAL PEACE 
 
 proof from absolute failure was clear that 
 Utopian Communism is merely Utopian. 
 
 The other settlement on the Fourier system, 
 which has had a history, was formed at Oneida 
 Creek, New York State, in 1847. It was 
 founded on a religious basis and composed of 
 a select company of devout people with a 
 high regard for the useful commandments. 
 Its leaders, John Humphreys Noyes, and 
 afterwards Jonathan Burt, were influenced 
 by the Communism referred to in the Book of 
 the Acts, and proclaimed themselves ' Bible 
 Communists.' The settlement at first was 
 agricultural, but agriculture requires more 
 liberty and more personal industry than any 
 rigid method can afford. Eventually the 
 community began to manufacture, and by the 
 industry, frugality and foresight of its members, 
 it prospered and grew in numbers. The 
 members lapsed into some tenets, especially 
 in regard to the inescapable sex question, 
 which shocked the consciences of their neigh- 
 bours. But their success as a productive 
 community tempted them and proved their 
 undoing. They became a close corporation, 
 admitting no outsiders, and finally deserted 
 Communism, and formed themselves into a 
 joint stock company with a capital of £120,000. 
 This new company has continued to prosper, 
 
UTOPIAN COMMUNISM 133 
 
 and its manufactures are known over the 
 whole of the United States, but its business is 
 carried on entirely on a capitalistic basis. 
 The clear conclusion is that not only will such 
 Utopian Communism as Fourier attempted 
 fail to solve the problems of labour, but it 
 cannot continue to exist. 
 
 in 
 Robert Owen is the most notable of the three. 
 He began work at the age of nine, became the 
 manager of a cotton mill in his twentieth year, 
 and a partner of an important spinning firm 
 when he was twenty-four years of age. He 
 joined his father-in-law, David Dale, in the 
 ownership and management of the mills at 
 New Lanark on the Upper Clyde. The social 
 condition of the operatives and of their chil- 
 dren moved him to compassion and roused 
 his practical mind to action. He founded 
 infant schools, opened a store for the supply 
 of honest goods at a reasonable price, improved 
 the comfort of the homes of the people, and 
 inculcated habits of order, cleanliness, and 
 thrift. But he was not content with this 
 measure of improvement, and from being a 
 philanthropist and reformer he became a 
 commimist. In his first book, A New View of 
 Society, or Essays on the Principle of the 
 
184 THE QUEST OF INDUSTRIAL PEACE 
 
 Formation of the Human Character, he sounded 
 the keynote of his after-teaching and effort. 
 He held that a man's character is made, not 
 by him, but for him. It has been formed by 
 circumstances over which he has no control; 
 he is not a proper subject either of praise or 
 blame. This led him to the conclusion that 
 the secret of the right formation of a man's 
 character is to place him under the proper 
 industrial, social, and moral influences from 
 his earliest years. His method rests on the 
 conception that the problem of a new social 
 order is largely, if not entirely, a problem of 
 environment. He does not go so far as to 
 declare that the environment is all in all, 
 but only that it is the ruling factor in the 
 formation of character, and that a fitting 
 environment can be given only under 
 Communism. 
 
 The practical measures which he adopted 
 are marked by definiteness, simplicity, and a 
 certain rigour. In sympathy with Fourier he 
 formed commimities of about twelve hmidred 
 persons, to be settled upon an area of land of 
 about one thousand acres. The community 
 would live in a large building in the form of a 
 square, with a public kitchen and a common 
 eating room. Each family would have its 
 own private apartments, with the care of the 
 
UTOPIAN COMMUNISM 135 
 
 children until the age of three. Then they 
 would be taken from their parents and trained 
 and educated by the community. As time 
 went on he also began to entertain lax views 
 on the question of marriage. ' Owen's denunci- 
 ation of marriage is inspired by his perception 
 that the social structure of the old immoral 
 world was based on the family, and that the 
 breaking up of the family system was an 
 essential preliminary to the institution of the 
 new moral order.' ^ As a man of a somewhat 
 fanatic temperament he lessened his influence 
 and hindered the acceptance of his views by 
 a fierce and aggressive hostility to the ac- 
 cepted religious ideal of his day. Yet in this 
 he was also inspired by a clear perception 
 that religious idealism was hostile to that 
 methodised secularism on which he based his 
 commime. 
 
 In 1825 he succeeded in visualising his ideas 
 by establishing a commune at Orbiston, near 
 Glasgow, under the able leadership of Abraham 
 Combe, an ardent disciple. In the same year 
 he founded a second commune, at the begin- 
 ning under his own oversight, at New Harmony, 
 in the State of Indiana. Both of these com- 
 munes, as the projects of a man with a superb 
 genius for organisation, had a measure of 
 
 1 Cf. Podmbre, lAfe of Robert Owen, vol. i. p. 138. 
 
136 THE QUEST OF INDUSTRIAL PEACE 
 
 success at the beginning. In the end they 
 were disastrous and heart-breaking failures. 
 There is no more pathetic reading than the 
 story of his strenuous and embittered life. 
 His Autobiography is the record of a man with 
 a strong, clear, courageous mind, an intense 
 and definite character and an tinfaltering will, 
 with the fantastic and autocratic disposition 
 which accompanies such a personality, who 
 failed in all he attempted when he passed from 
 the method of Capitalism to that of Collec- 
 tivism. Towards the close of his life he 
 abandoned his confident secularism, became a 
 spiritualist absorbed in table rappings, and 
 busied himself in the issue of sympathetic 
 journals. He died a poverty-stricken and dis- 
 illusioned man. 
 
 IV 
 
 The record of Owen's Communism is interest- 
 ing in itself. But its real importance is its 
 witness to the causes of the failure of Socialism. 
 His own. words include the best exposition of 
 the fallacies involved in his ideal. In an 
 address at New Harmony, in 1887, he dis- 
 closes the situation. ' I tried a new course, 
 for which I was inclined to hope, that fifty 
 years of political liberty had prepared the 
 American people to govern themselves ad- 
 
UTOPIAN COMMUNISM 137 
 
 vantageously. I supplied land, houses, and 
 the use of much capital. The experience 
 proved that the attempt was premature to 
 invite a number of strangers, not previously 
 educated for the purpose, who should carry 
 on extensive operations for their common 
 interests, and live together as a common 
 family. I afterwards tried, before my last 
 departure hence, what could be done by those 
 associated through their own choice and in 
 small numbers. To these I gave leases of 
 large tracts of good land for ten thousand 
 years at a nominal rent, and on moral con- 
 ditions only. Now, upon my return, I find 
 that the influences of the individual system 
 are so powerful that these leases have been, 
 with few exceptions, appUed to individual 
 purposes and individual gain, and, in conse- 
 quence, they must return once more into my 
 hands.' Owen attempted to re-order the com- 
 munity so as to permit of ' separate families,' 
 and to allow a place to individual action. 
 That compromise also failed, and the so-called 
 New Harmony ended in disaster and strife. 
 
 We need not expect Owen to confess the 
 failure of his scheme too exphcitly. The 
 exacter truth is put succinctly in a letter from 
 his grand-daughter in the London Daily Tele- 
 graph of 8th October 1908 ;— 
 
138 THE QUEST OF INDUSTRIAL PEACE 
 
 ' My grandfather had an income of £40,000 
 a year, and he spent the whole of his fortune 
 on his experiments, dying without a pound in 
 his pocket. Thus the colony was entirely free 
 from debt, and money could be provided. 
 He was a noted administrator, and the spot 
 was exceedingly well chosen, for the village 
 had been well laid out and planted by the 
 former German owners. The surrounding 
 lands were well watered and exceptionally 
 fertile. There was water power and an exit, 
 viz., the Wabash, Ohio, and Mississippi Rivers. 
 Nevertheless an experiment begun under these 
 favourable auspices failed in three short years. 
 When he shared his fortune equally with his 
 neighbours, both he and many of his neighbours 
 came to grief, because only the noblest among 
 them were willing to work eflBciently, when 
 the pressure of daily need was removed.— 
 Yours sincerely, 
 
 A Grand-daughter of Robert Owen.' 
 
 The broad lesson from these failures had been 
 taught so securely that many supposed that 
 never again would any one attempt to found 
 a Utopian commune. Yet, in 1893, William 
 Lane, of English birth, American education, 
 who had become a journalist in Australia, 
 propounded a scheme for founding a commune 
 
UTOPIAN COMMUNISM 139 
 
 in a new country. The Labour Party of 
 Australia was discredited because of the 
 enormous losses it had inflicted upon the 
 people. The socialists in their number had 
 hotly denounced what they called ' wage- 
 slavery ' and demanded emancipation. Lane's 
 commune seemed to promise a fulfilment of 
 their hopes. Money was subscribed, a favour- 
 able location was found in Paraguay, and 
 the Government of that state gave a cordial 
 welcome to the settlers and assigned them 
 six hundred square miles of magnificent land. 
 To give room and scope for the experiment 
 the Government bought out the squatters who 
 had prepared some portions of this vast estate. 
 The men and women who embarked upon 
 the enterprise were considered, both by their 
 character and their mode of life, singularly 
 adaptable, and the mpvement began with 
 every hope of success. Yet troubles emerged 
 very shortly after the company set sail. The 
 question of discipline aroused a constant 
 rebellion, for they had not learned that in 
 any organisation some must give orders and 
 some must obey. When they were settled 
 some of the members demanded the right to 
 visit neighbouring villages for drink. They 
 were expelled as having broken the laws of 
 the commimity. But the still greater diffi- 
 
140 THE QUEST OF INDUSTRIAL PEACE 
 
 culty of fulfilling the rule of this ' New 
 Australia ' — ' One for all, and all for one ' — 
 proved the final undoing. In actual fact each 
 man was determined to do no more than his 
 fair share of work for the common cause, and 
 as it was found that a few hours' work would 
 not procure abundance for all, many refused 
 to undergo the strain of a full day's toil. 
 Failure dogged the actions of William Lane, 
 although a whole-hearted and generous 
 enthusiast, from the beginning. Some fresh 
 recruits from Australia enabled a second colony 
 on a renewed grant of land to be established. 
 Here again disaster swiftly overtook the settle- 
 ment, and these Utopian communists were 
 taught that even with a gift of land, an ideal 
 climate, and a patronising Government, if 
 men will not work steadily, with some self- 
 denial, and under an oversight which must 
 be obeyed, economic impoverishment and 
 moral disaster are the inevitable issues.^ 
 
 V 
 
 Utopian Communism has an historic interest, 
 but its chief value is its testimony to the 
 reasons of failiire. These reasons apply to 
 every method of Commimism. First among 
 
 * Cf. Where Socialim Failed, by Stewart Grahame. 
 
UTOPIAN COMMUNISM 141 
 
 them is the fact that it failed to solve the 
 problem of sufficient production. The Utopian 
 Communists had fixed their mind on a fairer 
 distribution. They were moved by a sympathy 
 for those who suffered from the inequality in 
 the social conditions of men. They acted in 
 the belief that if equality in distribution could 
 be attained, production in ample and willing 
 abundance would be the inevitable result. 
 They seemed never to realise the two truths 
 that equality in distribution is seldom equity 
 of distribution, and that the incentive which 
 the average man requires to induce him to 
 toil steadily and with a compelling interest, 
 is a personal reward. To this source of failure 
 all the sentimental socialists may attribute 
 the disasters which have overtaken their 
 experiments. To this day the proposal to 
 give all an equal dividend, whether it is 
 earned or not, the refusal to compel men who 
 are lazy and selfish to work, the insistence 
 that the man of energy and the man of sloth 
 shall receive the same regard in the com- 
 mxmity, leave both the problem of distribu- 
 tion and of production imsolved. Greed, envy, 
 hate, find a larger opportunity in Utopian 
 Communism than under Capitalism. Let one 
 man believe that another has been given 
 a better portion of land, or a more agreeable 
 
142 THE QUEST OF INDUSTRIAL PEACE 
 
 occupation, or a larger share of the comfort 
 of life, and he will sulk, become discontented, 
 and rebel. These moral blemishes brought 
 both Owen's and Lane's well-meant schemes 
 to disaster, and they operate through the 
 whole round of socialistic endeavour. 
 
 A second reason for the failure of Utopian 
 Communism has been its attitude toward 
 the home and the family. This may seem 
 not to be an inherent part of a collectivist 
 social order. But as we have seen, and as 
 most thorough-going collectivists reaUse, the 
 family remains the permanent impediment to 
 the realisation of a commune, whether it be 
 of a few individuals, or of the State. Col- 
 lectivism demands that the unit must be the 
 individual. The family, which is really the 
 only possible conmiune, maintains that the 
 true unity is that of the man and the woman 
 and the child, and the only possible phalan- 
 st^re is the home. The family is not based 
 merely on instincts, although were that so, 
 such instincts cannot be ignored. The family 
 is based upon dominating and sacred passions, 
 and its obUgations as sanctioned by conscience. 
 Every form of Communism which is built 
 upon the individual as the tmit, will find the 
 family asserting rights and duties which will 
 break up any attempt to disregard them. No 
 
UTOPIAN COMMUNISM 143 
 
 economic or industrial scheme will be stable, 
 or will endure, unless it can find a place for 
 the family, can maintain and protect the 
 chastity of man and woman, and can enable 
 the man and the woman to set up a home in 
 which their independence of their neighbours 
 can be realised, and the atmosphere of tender 
 affection can be generated. 
 
 The most instant and imminent of the failure 
 of Utopian Communism is in its artificiality. 
 It does not recognise the facts of life. It fails 
 to understand the conditions of production 
 and distribution. The autocrats, who have 
 been its leaders, have never discerned either 
 the moral or the practical necessities of the 
 human spirit. They have been bemused by 
 the idea that they could construct a frame- 
 work into which they could pack and squeeze 
 all human activities. The Marxian socialists, 
 and especially Engels, pour scorn on ' Utopism.' 
 August Bebel in his Charles Fourier, sets it 
 more simply and decisively. ' The great pro- 
 gress of our race is that the Utopians have 
 died, or are dying out. Among the masses 
 they find no foothold. Even the simplest 
 workman feels that nothing can be set up 
 artificially, that what is to be must develop, 
 and must develop with and through the whole, 
 not separated and isolated from it.' There 
 
144 THE QUEST OF INDUSTRIAL PEACE 
 
 is the fatal flaw in all the schemes which 
 attempt, either by some closely jointed 
 framework or by some method of violence, 
 to set up a system of Collectivism, and to 
 impose it on the free spirit of the human 
 personality. 
 
VIII 
 
 THE CO-OPERATIVE MOVEMENT 
 
 When Utopian Communism died silence fell 
 on all around its grave. Its advocates realised 
 that however fair might be their dream the 
 method was impracticable. They perceived 
 that in the industrial order there is a greater 
 need of intelligence, capacity, and character 
 than of capital. They were taught that no 
 Communism can cope with the manufacturing 
 and agricultural industries with success. The 
 word Communism fell into bad odour, and 
 that odour clings to it still. Yet the dream 
 did not entirely fade away and eager spirits 
 began to think out a new method of realising 
 it. That endeavour took final shape in the 
 co-operative movement. 
 
 From one aspect co-operation may be de- 
 scribed as a limited and controlled Capitalism. 
 From another it is held to be a wiser applica- 
 tion of the principles of Collectivism. It may 
 be more accurately thought of as a hybrid, but 
 if its dominant ideals be considered it must 
 be finally classed as an imperfect Collectivism. 
 
146 THE QUEST OF INDUSTRIAL PEACE 
 
 The founders of the co-operative movement 
 cherished the aims of the early communists, 
 but refused to follow the path of their practice. 
 They reclaimed against the imposition of any 
 moral or psychological test on those seeking 
 membership. They refused any mode which 
 would make them an isolated sect in the com- 
 munity. They based themselves entirely on 
 an economic basis, and with a true instinct they 
 chose a name to express their agreement 'to 
 work together ' for their own economic advan- 
 tage. They organised societies to distribute 
 the chief necessities of life, employing their 
 own capital and labour, and sharing the 
 resultant gain. Distribution of the profit was 
 made not on a basis of equality, but on the 
 proportion of each member's contribution. 
 They did not desire to expropriate the wealth 
 of the capitalist, but they set themselves to 
 do without him. 
 
 I 
 The history of the co-operative movement 
 is the best exposition of its aims and methods. 
 The dynamic in the minds of its founders was 
 the moral passion of giving the workman a 
 freer and fuller life by affording him a larger 
 share in the results of the co-operation of 
 labour and capital. Their conceptions owed 
 
THE CO-OPERATIVE MOVEMENT 147 
 
 their force chiefly to Robert Owen. He pro- 
 claimed to his generation what men should 
 never be allowed to forget, that a stable in- 
 dustrial order can be attained only by a man 
 looking not only on his things but on the things 
 of others. The real legacy of Robert Owen 
 was this passion for social well-being, and the 
 name socialist is honoured by being first borne 
 by this Greatheart among men. His ameliora- 
 tive measures among his work-people had 
 aroused the interest of all classes. New 
 Lanark became a place of pilgrimage to all 
 social reformers. They marked its order, 
 cleanliness and moral elevation. They did not 
 know how severe and at times how detailed 
 was the regimen under which that model 
 community lived. They did not realise, as 
 Owen himself did not fully perceive, that the 
 social well-being of the two thousand men 
 and women gathered round the mill at New 
 Lanark was due to the authority and rule of 
 a wise, strong-willed, benevolent autocrat, 
 and not to a new industrial order. The failure 
 of his developed methods as a communist 
 shook men's faith, but his postulates had made 
 a deep impression. When he maintained that 
 character is dependent most largely on environ- 
 ment he took up a position which history and 
 psychology refute. But when he taught that 
 
148 THE QUEST OF INDUSTRIAL PEACE 
 
 a healthful and gracious life was ultimately 
 dependent on character he proclaimed a truth 
 which suffers constant neglect. The founders 
 of the co-operative movement caught the 
 contagion of his moral ideal and limited them- 
 selves to what seemed of first necessity and of 
 inunediate practicability in his aims. 
 
 The movement began with the founding of 
 small societies which bought household pro- 
 visions wholesale to retail them at the lowest 
 possible price. They made a feeble attempt at 
 production by encouraging their members to 
 supply them with such articles as an artisan 
 could make in his leisure hours. They called 
 their httle estabhshments ' Union Shops,' and 
 of these over four hxmdred were opened be- 
 tween 1828 and 1834. This movement failed, 
 sometimes because of mismanagement, some- 
 times because the enthusiasm of the members 
 died out, and sometimes because the 'shop' 
 became a private business concern as its 
 capital accumulated. As a consequence the 
 eager spirits in the movement set themselves 
 to reorganise their societies. They saw the 
 need of ' a better method.' This better method 
 was adopted in England first at Rochdale, 
 and its success has been the shining example 
 followed by co-operative societies everywhere. 
 
 The features of this better method are easily 
 
THE CO-OPERATIVE MOVEMENT 149 
 
 recognisable. The first is the law of the small 
 beginning. The Rochdale Equitable Pioneers 
 was founded in 1844. Twenty-eight poor men 
 gathered a capital of £28 in small subscrip- 
 tions, and opened a little shop in Toad Lane, 
 Rochdale. They described their aim as that 
 of 'founding a self-supporting community.' 
 They succeeded in the one practical point of 
 setting up an efficient society for the distri- 
 bution of the common necessities of life. In 
 the same way a handful of poor weavers 
 established a baking business at Ghent, in 
 Belgium. They began in a cellar with eighty- 
 five francs of subscribed capital, and an 
 equipment of an old kneading-ti-ough, an old 
 shovel, an old oven, and a big basket to carry 
 the loaves. The notably successful agricul- 
 tural co-operative movement of Denmark also 
 began in a humble way, and has gradually 
 developed into a well-organised society whose 
 products are exported to every neighbouring 
 country. As interesting and confirming has 
 been the Schultze-Delitzsch co-operative banks 
 in Germany. They were opened with a small 
 share-capital, subscribed by fifty persons, and 
 they have extended from town to town and 
 play an important part in the life of the people. 
 In this regard co-operation has followed that 
 law, which shrewd capitalists sometimes neglect, 
 
150 THE QUEST OF INDUSTRIAL PEACE 
 
 that a great enterprise must have small begin- 
 nings. This feature carries a most important 
 corollary that any attempt to transfer exten- 
 sive and complex industries by any swift or 
 violent movement, from one method of organis- 
 ation to another, is certain to fail. 
 
 A second feature of the co-operative move- 
 ment was the public spirit and imselfish service 
 of the early founders. In this we can realise 
 the true power of an ideal. An ideal has a 
 tremendous dynamic in creating an enthusiasm 
 at the beginning of any enterprise. Its power 
 is increased if there is a battle to fight or some 
 single and definite purpose to serve, or if scorn 
 and persecution be the portion of those who 
 cherish it. Men and women have endiu*ed 
 suffering, faced the misery of limiting condi- 
 tions, accepted disagreeable and even dirty 
 work in founding a movement or in carrying 
 on a struggle for liberty or maintaining a 
 cause which promised newness of life. But 
 this ideal is not a sufficient source of energy 
 when the object has been gained or the quieter 
 pace of an unhindered progress must be kept 
 or the battle goes against those who fight. As 
 Plato divined, an ideal must not only persist, 
 but must become enriched in beauty and en- 
 larged in scope. If the co-operative move- 
 ment will recover the ardpur and the chivalry 
 
THE CO-OPERATIVE MOVEMENT 151 
 
 of its origin, it must enlarge and renew its ideal. 
 Did its ideal embrace a further point of vision 
 and appeal to a still nobler self-denial, it might 
 add another chapter to its history. 
 
 A third feature has been the sound common 
 sense and economic wisdom which thought 
 out the method adopted in Rochdale, and has 
 developed the enterprise. The goods were not 
 only soTUid, but of high quality. The stores 
 were well equipped and scrupulously clean. 
 The service was prompt and courteous. The 
 whole business was based on payment of cash 
 over the counter. The goods, except in the 
 case of heavier articles, were not delivered to 
 the customers and the cost of transport was 
 saved. The provisions of a co-operative store 
 are not cheaper than, they are seldom so cheap 
 as, those supplied by the private trader, but 
 the quarterly dividend to the shareholders has 
 seldom failed, and that is the confirming 
 economic result of the commercial method 
 adopted. 
 
 The history of the movement records the 
 enormous growth in the membership and the 
 increase in the capital of the society and the 
 wealth of the shareholders. It has been 
 declared that one-third of the retail provision 
 trade in Great Britain is in the hands of co- 
 operative societies. In some districts the 
 
152 THE QUEST OF INDUSTRIAL PEACE 
 
 majority of the better paid artisans are 
 customers at the stores. Only the very poor 
 and the well-to-do are outside their member- 
 ship. Still more striking is the fact that their 
 assets and reserves are now coimted by millions, 
 so that recent legislation has endeavoured to 
 include the income from these millions as 
 entitled to bear share of taxation. Still more 
 remarkable has been the organisation of the 
 Wholesale Co-operative Societies, so often 
 housed in fine buildings, buying in every 
 market in the world and managed by directors 
 with an ability such as would make any 
 business successful. The turnover of these 
 societies is approaching £18,000,000 a year. 
 There is room for regret that the co-operative 
 movement tends to crush out the small trader. 
 The small trader, with his personal attention, 
 independent position and aU the incentives 
 which make for initiative and resource, is an 
 asset to the social and political life of the 
 coimtry. Yet no one can deny the gain, both 
 moral and economic, from the successful work- 
 ing of a co-operative movement. 
 
 n 
 This interesting record has more than ful- 
 filled the expectation of the early co-operators, 
 but it has not realised their most ardent hopes. 
 
THE CO-OPERATIVE MOVEMENT 153 
 
 Broadly speaking, co-operation has succeeded 
 only in distribution. It has failed in produc- 
 tion. The real reason of its failure is that in 
 distribution it is capitalist in its constitution, 
 but in production it becomes collectivist, and 
 Collectivism always spells economic failure 
 in production. 
 
 As a consequence of the attempt on the 
 part of co-operative societies to enter the field 
 of production a division has been created. 
 There are now two kinds of co-operation, and 
 they do not dwell in complete amity. The 
 first is distributive, or consumers' co-operation 
 exhibited in the large and wealthy stores. 
 The second is productive or industrial co- 
 operation exhibited in the factories and work- 
 shops. Distributive co-operation follows the 
 Rochdale method in exact detail. Membership 
 is gained on payment of an entrance fee. The 
 shares are valued at £l each, which may be 
 paid on joining the society, or out of subse- 
 quent dividends. A record of each member's 
 purchases is kept by issuing counters to the 
 amount of every purchase. At the end of 
 every quarter, after pajang a limited interest 
 on each member's capital, the surplus is paid 
 back to the purchaser as a dividend on the 
 whole amount purchased. In some societies 
 non-members receive a small share of the 
 
154 THE QUEST OF INDUSTRIAL PEACE 
 
 surplus. In others they receive nothing, so 
 that every purchaser who is not a member 
 contributes to the dividend of the society. 
 In virtue of the dividend the co-operative 
 society encourages thrift, and is practically 
 a branch Savings Bank. The housewife saves 
 almost imconsciously, and the dividend comes 
 in opportunely to meet the demand for the rent. 
 But productive or industrial co-operation 
 cannot adopt this method, and in consequence 
 has had a most chequered history. Some 
 societies have failed ; others have succeeded ; 
 few have grown large. The number of 
 societies which are only productive is singu- 
 larly few. That has not been for want of 
 capital, for in most cases both the capital and 
 the credit of a wealthy co-operative store 
 has been behind the productive society. The 
 true reasons of failure have been the less eager 
 resource and power of initiative and the 
 inability to take risks and make ventures, as 
 compared with Capitalism, with the conse- 
 quent result of a higher cost in production. 
 But a further reason lies in the labour questions 
 which trouble the movement. Friction be- 
 tween the management and the worker occur 
 here as in all production. The tasks which 
 the oversight of a great factory brings with 
 it, where day by day decisions have to be 
 
THE CO-OPERATIVE MOVEMENT 155 
 
 made, plans formed, and orders given, always 
 give an opportunity for difference and dis- 
 content. The manager is in a sense the 
 employee of those whom he manages when 
 they are shareholders, and he is liable to be 
 called to account at the meetings of the society 
 by any worker who cherishes a grudge against 
 him. He is dependent for his position upon 
 the favour and even temper of the employees, 
 and he is open to temptations, which need not 
 be named, such as do not assail an independent 
 employer. As a consequence productive co- 
 operation has not solved this problem of 
 industry. It has not been able to place its 
 goods on the general market. Its only en- 
 tirely successful factories and workshops are 
 ' tied ' establishments, which supply the 
 Wholesale Co-operative Societies to which they 
 usually belong. 
 
 This dualism has been exposed by a keen 
 division of opinion, and cause of debate in 
 recent co-operation. As a rule distributive 
 co-operation pays a dividend only to the 
 shareholder as a purchaser at the store. 
 Productive co-operation has made the demand 
 that the workers shall share in the control, the 
 responsibility, and especially the profits of the 
 society. It argues that in true co-operation 
 labour should have the interest of receiving 
 
156 THE QUEST OF INDUSTRIAL PEACE 
 
 a share of the dividend. The reply is made 
 that the profit comes from the purchases of 
 the consumer and is largely due to the higher 
 price which he pays for the sake of the dividend, 
 and it is further afl&rmed that the producer 
 has received his due share of the profit in his 
 wage, and that wage is adequate. The pro- 
 ductive co-operator replies that the favour 
 of the producer is essential, and that if he is 
 divorced from the control of the management 
 he is as much at the mercy of the shareholders 
 as the ordinary workman is at the mercy of 
 the capitalist. He sums up his argument 
 by declaring that if he is not given a share of 
 the product he is deprived of a necessary and 
 potent incentive. He falls back on one of 
 the clear arguments from capitalistic resource 
 and endeavour. So that it appears that while 
 distributive co-operation has succeeded when 
 it has confined itself to certain broad lines of 
 domestic supply, it has failed in industrial 
 production both to produce a large and varied 
 quantity of goods, and to produce them at an 
 economic cost. 
 
 Ill 
 The question that emerges i&— How far 
 can the Co-operative Movement be regarded 
 as an avenue of progress to a settlement of 
 
THE CO-OPERATIVE MOVEMENT 157 
 
 the industrial problem and thereby bring in 
 peace ? Is there any possible adaptation of 
 its method which can include the whole diffi- 
 cult round of the industrial order ? The 
 answer must be left to history, but the 
 outlook does not lend itself to an affirmative 
 reply. 
 
 To begin with, co-operation is capitalist in 
 its inner being, and the inner being always 
 determines a movement in the end. A co- 
 operative society is in reality a joint stock 
 company with an unUmited number of small 
 shareholders. The large munber of its mem- 
 bers are attracted, not by any theory of the 
 State or of production, and not by any desire 
 to aboUsh the capitaUst, but rather to share 
 his gain. They are drawn by ' the lure of 
 the dividend.' Were the dividend to fall to a 
 few pence, or to fail in any year, the directors 
 know that they would meet trouble. The 
 customers would desert the stores and return 
 to the small trader where their wants would be 
 personally recognised. There is nothing blame- 
 worthy in this attraction of a fair and honest 
 dividend, and so long as it remains essential 
 to the method co-operation must be included 
 under Capitalism. That inclusion, as we shall 
 see, is a fact of supreme importance, and the 
 method of the dividend may have much light 
 
158 THE QUEST OF INDUSTRIAL PEACE 
 
 to throw on the terms of peace between capital 
 and labour. 
 
 It must be further pointed out that the co- 
 operative movement has succeeded only as a 
 part of a capitalistic industrial order and by 
 the help of wage-earners. If there were no 
 great ship-building yards, no engineering shops, 
 no spinning and weaving mills, and no trans- 
 port companies paying wages to thousands 
 of employees, and giving them freedom to buy 
 where they please, co-operation would never 
 have come into being. There seems no pos- 
 sible path for a co-operative society from its 
 place in a wage-earning community to one in 
 which the people would no longer have wages 
 to spend. If every industry were to be Con- 
 trolled by a pubUc authority, and financed 
 by the State, both freedom of purchase and 
 freedom of demand would be extinguished. 
 The only two possible issues, it would appear, 
 from the abolition of the present industrial 
 order are either that co-operation will be flimg 
 to the scrap-heap along with every other form 
 of dividend-paying Capitalism, or be taken 
 over as a going concern by the State with the 
 immediate result of abolishing the small share- 
 holder and his dividend. Which of these issues 
 is the more acceptable may be left to the judg* 
 ment of the co-operator. 
 
THE CO-OPERATIVE MOVEMENT 159 
 
 One third critical remark is that co-operation 
 has succeeded, even in distribution, only in 
 ' the small and handy trades,' and only in 
 the larger centres of population. The making 
 of boots and shoes, the baking of bread, the 
 manufacture of gas, the carrying on of the 
 enterprises of printing and similar trades, 
 have afforded a field for productive co-opera- 
 tion in connection with distribution. But all 
 the greater industries, such as the manufacture 
 of cloth and the weaving of wool and cotton, 
 the building of ships and of costly machinery, 
 the shipping and export undertakings of the 
 country, have been beyond its power. It has 
 entered only the domestic sphere. There are 
 great adventures to be undertaken only by 
 large capitalistic firms who leave the directors 
 an ample liberty, or by municipalities or by 
 the State, both of whom can take the money 
 of the people exacted by taxation to finance 
 their undertakings and even to pay their 
 losses. It seems clear that the co-operative 
 movement of itself is not in the line of 
 progress toward a solution of industrial unrest. 
 
 IV 
 
 But the question remains, and recent events 
 have made it critical — Can co-operation be so 
 
160 THE QUEST OF INDUSTRIAL PEACE 
 
 adjusted as to march in the ranks of the 
 whole-hearted coUectivists ? 
 
 There is a three-fold answer to this question. 
 There are some who maintain that co-operation 
 is carrying out a function of education so that 
 its members will yet become pure and simple 
 coUectivists. These believe the day will come 
 when the co-operative movement will lead its 
 members to surrender their capital to the 
 State, turn their back on dividend-earning, 
 and refuse to remain partners in an isolated 
 shareholding company. There may be some 
 who are coUectivists first and co-operators 
 afterwards, but the present evidence rather 
 tends to prove that any assaiJt on the dividend 
 and on the freedom enjoyed by the co-opera- 
 tive shareholder would discover his antipathy 
 to CoUectivism. 
 
 A second answer is that co-operators are 
 being animated by the communistic spirit, 
 and that its members are being inspired by a 
 sense of solidarity with the manual workers, 
 to which they belong, and that the movement 
 can be transformed into a battaUon in the 
 army attacking the present industrial order. 
 But such an adjustment involves not only 
 economic but social and poUtical opinions. 
 It would aUenate many who cherish a personal 
 liberty. It would lose the sympathy of the 
 
THE CO-OPERATIVE MOVEME>rr 161 
 
 vast majority of the members of the Christian 
 Church. It would assail the existence of those 
 almost numberless smaller societies, chiefly 
 composed of working folk, which have been 
 formed to promote their social and domestic 
 well-being. Take a proof of this from the 
 President's address at a recent annual meeting 
 of the Independent Order of Oddfellows held 
 at Coventry on October 1920. 'The day 
 which sees voluntary service die,' he declared, 
 ' spells ruin to our societies. I am convinced, 
 however, that there is no fear of this happen- 
 ing, and there are signs that an increasing 
 interest is being taken in the development of 
 our work. We are far more than mere insur- 
 ance societies. The spirit of brotherhood and 
 love that binds us together is a valuable asset 
 in the day when we are faced with industrial 
 strife.' The speaker represented a member- 
 ship of nearly seven millions organised into 
 seventy-three societies, and this protest may 
 remind our time of the large numbers of greatly 
 silent, yet well-balanced and firmly-resolved 
 men and women who are opposed both from 
 their principles and their sympathy to any 
 movement which would abolish those volun- 
 tary societies to which co-operation belongs. 
 
 A third answer is that the co-operative 
 societies might form an alliance with Trades 
 
162 THE QUEST OF INDUSTRIAL PEACE 
 
 Unions to their mutual benefit. The Trades 
 Unions would encourage their members to 
 join the societies, and they would invest their 
 funds as part of their working capital. The 
 societies on their part would supply the wants 
 of a larger portion of the community, and that 
 would be an invaluable soxirce of strength in 
 the event of a general strike. But apart from 
 the economic hindrances, such as the locking 
 up of strike funds in the capital of the co- 
 operative stores, and the equally absurd idea 
 of the stores supplying provisions, largely on 
 credit, during a strike, the moral diflficulties 
 render this course almost an imposisibility. 
 Managing directors do not consent to put 
 halters round their own necks. Successful 
 men seldom commit suicide. The last thing 
 a shareholder will do is to imperil his dividend. 
 But to join the ranks of the political collectiv- 
 ists the co-operator must be inspired with a 
 resolve to sacrifice what he has hitherto valued, 
 to give up his dividend, surrender his little 
 capital, and transform his society into a pro- 
 pagandist agency. The average co-operator 
 may be willing to see the individual wealthy 
 capitalist abolished, and he may have no room 
 for the small trader in his scheme of things, 
 but he is not willing to abolish himself. The 
 conclusion rather is that the method of distri- 
 
THE CO-OPERATIVE MOVEMENT 168 
 
 bution adopted by co-operation, in which every 
 man shares in the profit by a proportionate 
 dividend, will receive more attention and be 
 given a due place in an industrial order wherein 
 peace shall prevail. But that is not collec- 
 tivism. 
 
IX 
 
 MABXIAN SOCIALISM 
 
 Utopian Socialism was condemned by the 
 judgment of history. But its fermenting yeast 
 found expression in Chartism and in Christian 
 Socialism in England, and leavened the minds 
 of such thinkers as Proudhon and Louis Blanc 
 in France. It aroused the energies and 
 quickened the imaginations of a band of 
 speculative young radicals in Germany who 
 engaged in critical assaults on the State and 
 its functions. From this group, with some 
 indebtedness to the socialistic thinkers both 
 of England and France, there came Heinrich 
 Karl Marx, who laid the basis and outlined 
 the methods of modern Socialism. 
 
 I 
 Marx was born in Treves, in Rhenish Prussia, 
 in 1818. His father, a Jewish lawyer, was 
 baptized into the Christian Church in 1824, 
 a step often taken to escape the disabilities 
 of Hebrew birth. After his course at the 
 Grammar School at Treves, he passed in 1835 to 
 
 184 
 
MARXIAN SOCIALISM 165 
 
 the University of Bonn, and then to BerUn, 
 taking in 1841 the degree of Doctor of Philo- 
 sophy. His Radical opinions shut the door 
 on his ambition to become a lecturer and then 
 a professor, and he entered the ranks of the 
 journalists. In the advocacy of his opinions 
 he found himself engaged in a never-ceasing 
 struggle with the censors of the press. Com- 
 pelled to leave Germany in 1844 he fled to 
 Paris, where he made the acquaintance of 
 Proudhon and of Heine. The French govern- 
 ment had no more toleration for him than 
 the Prussian, and he was compelled to find a 
 refuge in Brussels. There he was joined by 
 Friedrich Engels, the son of a wealthy cotton 
 spinner, and a member of a firm with a factory 
 in Manchester. Engels became his disciple 
 and married his daughter. He brought Marx 
 into contact with English Socialism, and that 
 led to his settlement in London. There he 
 lived many years, sometimes in great financial 
 straits. His undaunted and self-denying life 
 might have led him to question his theory of 
 the supreme power of economic conditions. 
 His courage and loyalty to conviction are a 
 signal proof that material circumstances are 
 not so determining in the social order as he 
 proclaimed them to be. 
 
 His first publication, written in collaboration 
 
166 THE QUEST OF INDUSTRIAL PEACE 
 
 with Engels, was a scathing criticism of the 
 speculative Radicalism of his former friends, 
 with the ironic title of The Holy Family. His 
 second work. The Misery of Philosophy, was a 
 rejoinder to Proudhon's Philosophy of Misery. 
 It was his habit to declaim against his former 
 associates with savage and contemptuous epi- 
 thets. When he fled to Brussels he joined a 
 communistic society of German working men 
 which had fostered conspiracy, but had now 
 become educational and propagandist. It had 
 been renamed the League of the Communists. 
 For this League he wrote in 1848, along with 
 Engels, the Communist Manifesto, Not until 
 1867 was there pubUshed in Hamburg the 
 first volume of his great work — Capital. This 
 was an economic exposition supported by a 
 labyrinth of statistics chiefly drawn from 
 English sources. His design was to publish 
 four volumes, but he died in 1886, leaving 
 behind him a large number of manuscripts. 
 Selections from these, edited by Engels, were 
 published in a second, and then in a third 
 volume at a date so late as 1895. Marx's 
 Capital has been called the Bible of Socialism. 
 It ought rather to be called the Talmud, for 
 it is as difiicult to read and often as tedious and 
 contradictory as that famous Hebrew com- 
 ment and exposition of the Old Testament 
 
MARXIAN SOCIALISM 167 
 
 literature. The real scripture of Marxian 
 Socialism is the Communist Manifesto. It is 
 the New Testament, or at least the Sermon 
 on the Mount, of this great apostle. To read 
 it along with the vehement pages which close 
 the first volume of Capital is to find both the 
 aims and the methods of Marxian Socialism 
 set in clear light. 
 
 11 
 Looking back at the emergence of Marx, we 
 can realise the debt which modern Socialism 
 owes to him. He discerned that the Socialism 
 of an isolated, self-centred community held no 
 solution for the problems of industry. He 
 saw that the Co-operative Movement could not 
 solve the problem of production. ' We recom- 
 mend workmen,' he wrote, 'to embark on 
 co-operative production rather than on co- 
 operative stores. The latter touch only the 
 surface of the economic question of to-day, 
 the first strikes at its fotmdation.' He insisted, 
 therefore, on a more comprehensive view of 
 the action of industrial and economic forces. 
 He set himself to construct a deeper philosophy 
 of the social order. He conducted an investiga- 
 tion to explain the relationships of capital and 
 labour as these were expressed in the social 
 conditions. His thesis was that the present 
 
168 THE QUEST OF INDUSTRIAL PEACE 
 
 social and political order was based upon and 
 developed by the economic necessities of life. 
 His object was not to supply a programme to 
 Socialism, or to outline a method, so much as 
 to lay down a basis of principles on which the 
 demand for a change in the constitution of 
 society could be founded. He took the theory 
 of Socialism out of the arena of a narrow, limited, 
 and merely local expression, and gave it a com- 
 manding place in the economic and pohtical 
 thought of the civilised world. 
 
 The mind of Marx can be disclosed almost 
 completely in two short paragraphs from the 
 Communist Manifesto. That condensed and 
 passionate appeal opens in this way—' The 
 history of all hitherto existing society is the 
 history of class struggles. Freeman and slave, 
 patrician and plebeian, baron and serf, guilds- 
 man and journeyman, in one word, oppressor 
 and oppressed, standing constantly in opposi- 
 tion to each other, carried on an iminterrupted 
 warfare, now open, now concealed ; a warfare 
 which always ended either in a revolutionary 
 transformation of the whole of society, or in 
 the common ruin of contending classes. . . . 
 Modern bourgeois society, springing from the 
 wreck of the feudal system, has not abolished 
 class antagonism. All society is more and 
 more splitting up into two opposite camps— 
 
MARXIAN SOCIALISM 169 
 
 into two great hostile classes — ^the bourgeoisie 
 and the proletariat.' These last two terms he 
 borrowed, shrewdly appreciating the French 
 gift of appellation, from Louis Blanc. 
 
 The Manifesto proceeds to denounce the 
 system of Capitalism, and to set forth, in a 
 succession of paragraphs, its outgrowth of 
 evils, and to call for its abolition. Many of 
 these short paragraphs are unbalanced in 
 their thinking and turgid in their language. 
 Some of the accusations are ridiculous, and 
 are not repeated even by his most convinced 
 supporters. Marx's habit of bitter and un- 
 measured diatribe injures his own case here as 
 elsewhere. But the Manifesto concludes with 
 an appeal which has been more potent than its 
 argument. No other piece of writing has been 
 more effectual in arousing the passions of greed 
 and hate. As it is repeated to audiences it 
 goes to some men's heads like strong wine. 
 ' The Communists disdain to conceal their 
 views and their aims. They openly declare 
 that their ends can be attained only by the 
 forcible overthrow of all existing conditions. 
 Let the ruling classes tremble at a Communist 
 revolution. The proletarians have nothing to 
 lose but their chains. They have a world to 
 win. Proletarians of all lands— unite.' 
 
 The exposition of the positions set down in 
 
170 THE QUEST OF INDUSTRIAL PEACE 
 
 savage and striking language in the Manifesto, 
 and maintained with elaborate and detailed 
 arguments in Capital, can be condensed into 
 four doctrines. The first is a doctrine of 
 history— the materialistic interpretation of its 
 determining forces. The second is a doctrine 
 of economics— the law of surplus value. The 
 third is a doctrine of method— the class war. 
 The fourth is a doctrine of government, or 
 politics, in the new social order— the dictator- 
 ship of the proletariat. 
 
 in 
 In supporting the materialistic interpreta- 
 tion of history Marx pointed out that hitherto 
 Socialism had been based on certain theories 
 of man and his rights, and of the consequent 
 functions and obligations of society. On these 
 theories the early communists had logically 
 based a Utopian social order. They were 
 great-hearted dreamers moved by an ideal of 
 justice and a passion of sympathy. But Marx 
 began by tracing the historic evolution of the 
 relationships in the social and industrial order. 
 He came to the conclusion that the political 
 order had been based on a material basis, and 
 that the constitution of every State had been 
 framed by those in the possession of power for 
 the purpose of securing and developing their 
 
MARXIAN SOCIALISM 171 
 
 economic advantage. Not some inspiring 
 ideal, not a spiritual passion, but the conditions 
 imposed by the material basis of life, had 
 determined the laws and fashioned the govern- 
 ment of the social and political order. It 
 might appear that men were inspired by a 
 high idealism. Idealism had its place, and 
 mystic conceptions of life and of labour might 
 be held. But they were not the conditioning 
 forces ; they were the conditioned. The domi- 
 nant and determining forces were the economic 
 and material, without which life could not be 
 maintained. These were wrought out in the 
 political institutions of every succeeding epoch. 
 Marx illustrated and applied this thesis to 
 the social order of his own time. His argu- 
 ment and his exposition of it may be condensed 
 into the simple statement that the social 
 order depends on tools. History is a record 
 of the power and action of tools. A change 
 or a development or adaptation of tools 
 changes the constitution of society. ' By 
 hammer and hand do all things stand ' is one 
 of his concise sayings. But the hammer in 
 the hand was changed, he pointed out, for the 
 ingenious machine which acts at a touch. 
 That brought in a new era of industry whereby 
 the whole order was altered. The invention 
 of the steam engine, of the spinning jenny. 
 
172 THE QUEST OF INDUSTRIAL PEACE 
 
 of the hot blast, of the cotton gin, changed the 
 methods of industry, brought about the in- 
 dustrial revolution, and shall finally alter the 
 constitution of society. The manual workers 
 cannot own these complex and costly tools. 
 They belong to the capitalist, and he uses them 
 to yield him wealth. But therein lies his 
 power, and he uses that power to develop and 
 adjust the economic and social order in his 
 own interest. The result is that the workers 
 are oppressed in their industrial condition, 
 and depressed in the social scale, until society 
 is divided into the two contending elements 
 of the bourgeoisie and the proletariat. 
 
 To the criticism that these restdts are not 
 in accordance with reason, Marx replied that 
 they are inevitable. In the language of his 
 early master, Hegel, he declared, ' The real 
 is the rational.' Any constitution of society 
 which did not express and secure the material 
 basis of life, and did not inevitably adapt itself 
 to the dominant forces of the time, would be 
 unreal. The masters of the tools, whoever 
 they might be, would always make the laws 
 which govern the use of the tools, and always 
 extract from the product the profit of their 
 using. The broad conclusion is that the con- 
 stitution of modem civilised society has been 
 fashioned and will be fashioned by these 
 
MARXIAN SOCIALISM 173 
 
 material conditions. The proletariat, there- 
 fore, must get command of the tools. Then 
 they will construct the economic and political 
 order after their will. As a consequence 
 Capitalism must pass away, and every en- 
 deavour to adjust it so as to conserve its 
 existence and mastery would issue in the end 
 in its abolition. 
 
 The only question to put and to answer here 
 is this — Is this materialistic reading of history 
 accurate ? Marx himself found it difficult 
 of proof. His disciples were compelled to 
 modify it in terms which are a virtual denial. 
 ' There are,' Engels confesses, ' innumerable 
 forces thwarting one another, an endless group 
 of parallelograms of forces, from which one 
 resultant — ^the historical event— is produced.' 
 Bernstein makes a more candid admission. 
 ' He who to-day employs the materialist theory 
 of history is boimd to employ it in its most 
 developed, not its most original form, i.e. he 
 is bound in addition to the development and 
 influence of the productive forces and the 
 conditions of production, to make full allow- 
 ance for the ideas of law and morals, the 
 historical and religious traditions of every 
 epoch, the influences of geographical and other 
 circumstances of nature, to which also the 
 nature of man and his spiritual disposition 
 
174 THE QUEST OF INDUSTRIAL PEACE 
 
 belong.' That is simply a carefully phrased 
 denial of Marx's doctrine of history. 
 
 The disproof of this interpretation is simpler 
 and more conclusive than Marx's followers are 
 willing to allow. It is inaccurate because of 
 the false conception of man on which it rests, 
 Marx regarded man as Hobbes conceived of 
 him in the Leviathan, as an animal, or as those 
 frankly-spoken French writers who allude to 
 la bete humaine. But man is not merely an 
 animal who uses tools. His physical wants 
 do not determine his history. He can enter- 
 tain noble thoughts, practise costly self-denial, 
 achieve splendid chivalries. He can pass out 
 to crusades in which he will despise not only 
 materialistic considerations, but life itself. 
 Every martyr is a denial of an economic reading 
 of history. The social organism is only th« 
 man written large. Without doubt the 
 materialistic forces play their part. Man can- 
 not live without bread, but he cannot live 
 by bread alone. Every noble company of 
 men who have made history, such as, to quote 
 the simplest instances, the Society of Friends, 
 the Scottish Covenanters, or those heroic lovers 
 of civil and religious liberty who founded 
 New England at the cost not only of material 
 well-being, but of life itself, afford the his- 
 toric proof that any interpretation of history, 
 which gives economics more than a subordin- 
 
MARXIAN SOCIALISM 175 
 
 ate place in the framing of a social political 
 order, is false to the facts. It is based on an 
 inaccurate conception of human nature. It is 
 affirming that the clay, and not the potter, deter- 
 mines the shape of the vessel on the wheel. 
 
 A broader and still more conclusive proof 
 of this fallacious doctrine can be drawn from 
 a historic time-view. There have been nations, 
 as there are men, whose lives and laws have 
 been determined almost entirely by material- 
 istic motives. The history of their social 
 order and political constitution is the record 
 of a struggle for wealth and its power. What 
 has been their fate ? They seemed to be 
 predestined to a splendid and enduring pre- 
 eminence, but they have all passed away. 
 Babylon, Assyria, Persia, Macedonia, are * dust 
 and ashes, dead and done with.'* In one 
 supreme instance, that of Rome, Gibbon, 
 Marx's master in history, has delineated the 
 certain issue and inescapable ruin of any 
 State whose constitution has been determined 
 by materialism. In his Decline and Fall he 
 traces the gradual deterioration of the moral 
 fibre of the Roman people. He points out 
 that the old ideals were abandoned and the 
 worldly policies of the emperors were matched 
 by the cries of an idle and profligate populace 
 
 > Cf. Ruskin's fin* exposition which evoked Browning's line in 
 at. Mark's Sett. 
 
176 THE QUEST OF INDUSTRIAL PEACH 
 
 for ' bread and games.' He pointedly sets out 
 the reasons of the judgment which overtook 
 both rulers and people. ' The counsels of 
 princes are more frequently influenced by views 
 of temporal advantage, than by considerations 
 of abstract and speculative truth ' (vol. i. 
 p. 541). By ' abstract and speculative truth,' 
 Gibbon means those high and serious moralities 
 which have held the minds and inspired the 
 counsels of every great State which has wrought 
 out the weU-being of men. When these are 
 disregarded for some ' temporal advantage ' 
 the death warrant of the nation is written. 
 ' The people which have no vision perish.' 
 When an impassioned devotion to a spiritual 
 order and the impartial moral justice which 
 it dictates are not given the chief place in 
 the ordering of men's hves and the fashioning 
 of their laws, the sentence of judgment, as 
 history unequivocally declares, goes forth. 
 The truth has been set unforgettably in a 
 prophetic coimsel couched in solemn words, 
 ' Love not the world, neither the things that 
 are in the world ; for all that is in the world, 
 the lust of the flesh, and the lust of the eyes, 
 and the pride of life, is not of the Father, but 
 is of the world ; and the world passeth away 
 and the lust thereof, but he that doeth the will 
 of God abideth for ever.' 
 
MARXIAN SOCIALISM 177 
 
 IV 
 
 Marx's second doctrine is the law, or pro- 
 perly speaking, the theory of surplus value. 
 The present capitalistic order was marked, he 
 maintained, by certain economic and industrial 
 facts. The first was the inevitable antagonism 
 of the interest of capital and labour. The 
 second was, that imder Capitalism men stood 
 toward each other under one or other of the 
 economic relationships of buyer and seller. 
 As a consequence they were compelled into an 
 attitude of dependence or independence. This 
 second assertion has no reality in regard to 
 labour. It may seem to be true that the 
 seller is dependent on the buyer. It is as true 
 that the buyer is dependent on the seller. 
 Every human relationship involves a certain 
 mutual dependence. The man who buys an 
 oiuice of tobacco across the coimter, or a book 
 in a stationer's shop, or seeks the services 
 of another as a lawyer, or a doctor, or an 
 architect, brings about this relationship of 
 buyer and seller. In each case one man sells 
 his power to work, for a definite time, under 
 definite conditions and at a definite wage. 
 But neither is really dependent upon the other, 
 and beyond that fact there is the truth that 
 each has a life which touches wide issues— 
 
 M 
 
178 THE QUEST OF INDUSTRIAI. PEACE 
 
 issues that are not determined by the mere 
 fact of being either a buyer or a seller. We 
 shall meet this cant and whine, based upon a 
 contemptible pride, again and again. What 
 is set down here and now is that Capitalism 
 does not, as Marx affirmed, bring the seller 
 into any limiting dependence on the buyer. 
 
 But his third assertion is the vital one. He 
 maintained that the capitaUst not only buys 
 labour as a mere commodity for a certain 
 price — a wage — but that he sells its product so 
 as to yield him a profit to which he has no right. 
 The product of labour, the argument runs, 
 has a three-fold value. There is the use-value 
 — ^the price it will bring in the market. There 
 is the labour- value — ^the cost of the maintenance 
 of the labourer in correspondence with his 
 socially developed habits and necessities. 
 There is the wage-value— the actual sum paid 
 to the labourer. The difference between the 
 wage-value and the labour-value Marx named 
 ' the surplus value.' This surplus value be- 
 longs to the labourer, but has been taken by 
 the capitalist to his own enrichment. It is 
 the pivot of the whole system of Capitalism. 
 It belongs to the labourer because the only 
 source of value, as Marx mistakenly main- 
 tained, is the labour which has been wrought 
 into the goods. The raw materials taken to 
 
MARXIAN SOCIALISM 179 
 
 a factory have little or no value, but when 
 labour is expended upon them and they 
 become finished goods, they acquire a use- 
 value. Since this value was wholly given by 
 labour, but is seized by the capitalist, labour 
 is ' exploited,' made a mere article of merchan- 
 dise, and robbed both of independence and 
 reward. 
 
 Marx endeavoured to lead the type of his 
 argument by affirming certain consequences of 
 this exploitation of the surplus value. He set 
 it forth in a four-fold indictment. To begin 
 with, there was the remorseless competition 
 by which the labourer is over-driven and 
 oppressed. There was again the concentra- 
 tion of industries, with the massing of workers 
 into congested areas, and a consequently in- 
 creasing dependence on their masters. There 
 was, as a third effect, the accumulation of 
 wealth in ever fewer hands. And the fourth 
 effect was the recurrence of periodic crises, in 
 which labour was threatened with destitution 
 and even starvation. All of these four affir- 
 mations have been negatived, and even 
 rendered ridiculous, by the history of industry 
 since Marx died. He was so confident of their 
 truth that he summed up the indictment with 
 his concise declaration, ' With the constantly 
 diminishing of capital magnates, who usurp 
 
180 THE QUEST OF INDUSTRIAL PEACE 
 
 and monopolise all the advantages of this 
 process of transformation, there is not only 
 the mass of misery, oppression, servitude, 
 deterioration, exploitation, but also with it 
 there is the revolt of the working class con- 
 stantly increasing, and taught, united, and 
 organised by the mechanism of the capitalist 
 process of production itself.' 
 
 It would not be worth while to discuss this 
 doctrine of surplus value were it not for the 
 fact that it still holds the minds of great masses 
 of unthinking and fierce-passioned men. It 
 has been discarded by most Marxian teachers 
 even in a greatly modified form. His disciples 
 have been busy with explanations which explain 
 it away. Its initial fallacy is that the surplus 
 value of any article can be ascertained, and its 
 second blunder is the assertion that value has 
 been given to the finished goods chiefly, if 
 not solely, by the labour spent upon them. 
 But there are articles of high value to whose 
 production labour has made only a small 
 contribution. There are other articles upon 
 which costly labour has been spent, yet they 
 have no value in the market-place at all. Be- 
 yond these simple truths there is the evident 
 fact that no man can determine how much of 
 the surplus value belongs to the individual 
 labourer, and the division of the amount of 
 
MARXIAN SOCIALISM 181 
 
 value in the product is an impossible problem 
 in arithmetic. Marx attempted to escape these 
 difficulties by positing that the amount of 
 labour was ' the socially necessary labour 
 spent on goods, measured according to time.' 
 Had Marx spent a few hours in any factory 
 or ship-building yard, he would not have set 
 down so hopelessly unmeaning a definition. 
 The foreman of any industrial work if asked 
 to explain what Marx stated to be ' the total, 
 social, surplus value ' of the goods produced, 
 would sit down in amazement at such an un- 
 real question and so utterly impossible a 
 calculation. 
 
 But the absolute confutation of this fallacy 
 is to be found in an examination of value — an 
 examination Marx and his disciples never 
 attempt. Value is dependent on two things. 
 One of these is the whole cost of production. 
 That includes not only what is called ' manual ' 
 labour (although indeed all men, from the 
 employer with his pen to the office boy who 
 delivers the letters, use their hands) but in- 
 cludes also management, inventive genius and 
 directing ability. In one passage Marx seems 
 to include these elements in production, but 
 in his argument and appeal he sees only the 
 man with the hammer in his hand. But value 
 is also dependent, not only on the mere price 
 
182 THE QUEST OF INDUSTRIAL PEACE 
 
 of production in terms of labour, but upon 
 capital and all that capital requires for its 
 maintenance, repair, and reproduction. The 
 simplest man can see that the value of goods 
 is vastly more than the labour which has been 
 put into them. Their chief value may often 
 be due to powers and to advantages which 
 have never touched the article with the hand 
 at all. 
 
 The second fact which constitutes value is 
 demand. It does not matter how much labour, 
 or management, or skill, or expenditure of 
 capital has been put into the product, if there 
 be no demand for it. A costly machine, 
 eclipsed by a new patent, has no value at all. 
 A ship which cannot get a cargo must be 
 laid up to waste in idleness. It has no value 
 because there is no demand for its service. A 
 diamond cut by the most skilful worker in 
 Amsterdam is not worth the price of a cup of 
 cold water to a man smitten by thirst in the 
 desert. Value is given not only by use, but 
 by scarcity. The goods manufactured from 
 raw material may be piled high within the 
 warehouses, but if tast» or fashion change, or 
 an inability to buy them be wanting, their 
 value shrinks to an extent that threatens their 
 holder with bankruptcy. So that both be- 
 cause of the imreality of the term ' surplus 
 
MARXIAN SOCIALISM 183 
 
 value,' and because of the dependence of value 
 on demand, this theory of surplus value is an 
 absurd fallacy. Had Karl Marx been some- 
 thing more than an onlooker and a journalist, 
 he would have been more able to understand 
 the facts behind value, and would have, as 
 his followers have done, discarded this absurd 
 economic doctrine. 
 
 Yet, as is very evident to-day, this doctrine 
 is eagerly maintained by ignorant advocates, 
 and has seized upon the mind of masses of men 
 whose only reading is found in the journals 
 which still maintain the theory. What gives 
 it force is the truth at which Marx was aiming. 
 That truth is the unfair distribution of the 
 product. Labour alone is merely embodied 
 power. Any surplus value above the cost of 
 production is not due to labour alone. But it 
 is true that capital has frequently taken more 
 than its share, and management has enjoyed 
 a larger proportion of the reward, than it was 
 entitled to. We must not forget that if 
 capital and management and direction some- 
 times take too large a share of the profit, at 
 other times they suffer all the loss. Plainly 
 what is needed is not only a fair, but a more 
 evident justice in the distribution of the pro- 
 duct. In the day when the capitalist and 
 director of labour will be as willing to be 
 
184 THE QUEST OF INDUSTRIAL PEACE 
 
 just to labour, as labour should be willing 
 to be just to capital, we shall find a more 
 righteous distribution of the product and the 
 profit, and we shall stand on the threshold 
 of industrial peace. 
 
X 
 
 MARXIAN SOCIALISM— (confoMMcd) 
 
 Upon his philosophic doctrine that the con- 
 stitution of the social order is determined by 
 material conditions, and his economic theory 
 of surplus value, Marx based his demand, 
 outlined his method of attaining it, and fore- 
 casted the goal to be reached,, so as to make the 
 social order secure. The demand was for the 
 socialisation of the means of production, dis- 
 tribution and exchange through the possession 
 and the control of the State. That would 
 issue in the abolition of Capitalism and of 
 landlordism, but most notably and desirably 
 in the emancipation of labour. His most 
 impassioned contention had been that Capital- 
 ism had exploited labour, and the first fruits 
 of the new social order and its well-being would 
 be the freedom of the labourer from the 
 control of the capitalist. 
 
 In Marx's teaching this emancipation had 
 an idealistic and a materialistic aspect. In the 
 ideal aspect its aim was the social independ- 
 ence of the labourer and the securing of the 
 
 185 
 
186 THE QUEST OF INDUSTRIAL PEACE 
 
 rights of his personality. He would become 
 the subject in industrial production, and not 
 one of its means. In the other aspect his 
 economic and industrial subordination would 
 be abolished, and the control of production 
 would be placed in his hands. We shall not 
 at this stage discuss the question as to whether 
 this control is a possibility in the modem 
 conditions of industrial life, or whether such 
 control is advisable with a due regard to the 
 just interests of the consumer. Such problems 
 do not seem to have occurred to a mind so 
 arbitrary and confident, and to a spirit so bitter 
 as his. Kautsky, his most thorough-going 
 recent expositor, educated by the experience 
 of nearly half a century after Marx's death, 
 confesses his honest doubt. ' If in this struggle 
 we place the socialist way of production as 
 the aim, it is because, in the technical and 
 economic conditions which prevail to-day, 
 socialist production appears to be the sole 
 means of attaining our object. Should it be 
 proved that we are wrong in so doing, and that 
 somehow the emancipation of the proletariat, 
 and of mankind, could be achieved solely on 
 the basis of private property, or could be most 
 easily realised in the manner indicated by 
 Proudhon, then we would throw Sociahsm 
 overboard, without in the least giving up our 
 
MARXIAN SOCIALISM 187 
 
 object, and even in the interests of the object.' 
 {Dictatorship of the Proletariat, p. 5.) 
 
 But Marx was rigorous in his demand, and 
 that rigour, without alternative, determined 
 his method— the class war, and became ex- 
 pressed in his goal— the dictatorship of the 
 proletariat. 
 
 I 
 In the class war Marx summoned the forces 
 of labour to an assault on capital. As we have 
 seen, he declared that society was divided 
 into two classes— the bourgeoisie and the pro- 
 letariat. These two terms do not express 
 social realities. It is not accurate to say that 
 in any order of society there are only two 
 classes. Many other interests and convictions 
 classify men and women. As if dimly con- 
 scious of this fact, Marx set himself to create 
 a class consciousness, which would inspire all 
 who are not in the ranks of the employing 
 capitalists. This ' crowd ' consciousness is a 
 tremendous dynamic. It may be morally 
 higher or morally lower than that of the great 
 majority of the individuals who make up the 
 crowd. A passionate appeal by some popular 
 demagogue may excite a crowd to an act of 
 violence of which they are afterwards ashamed, 
 or it may move them to go forward to heroic 
 
188 THE QUEST OF INDUSTRIAL PEACE 
 
 and chivalrous enterprise. We realise that in 
 the sphere of industry the thousands employed 
 in a riverside shipbuilding yard, or the still 
 greater numbers of a Trades Union, can be 
 roused to take a course of action which few 
 of them would adopt in a calm and self- 
 possessed mood. Marx, of set purpose, set 
 himself to create this antagonistic class con- 
 sciousness, so that no compromise between 
 capital and labour would be possible, and the 
 only mode of action become a class war. 
 
 There are reasons why this call to a class war 
 has been responded to by men and women 
 with different moral ideals and even diverse 
 spiritual impulses, although it must be noted 
 that a class war reacts upon every moral ideal 
 and every spiritual conviction. One reason 
 for the response is that aU men are disposed to 
 accept what seems to favour their interests. 
 The manual workers had long felt that their 
 lives were determined by material conditions. 
 They realised that their homes, pleasures, 
 activities, and many of their ways of life were 
 under the dominance of an economic deter- 
 minism. They did not understand that every 
 life, the life of the capitalist as much as of the 
 labourer, is conditioned by great facts of 
 existence which no system can alter. To 
 enlarge a saying of Emerson, ' Things are in 
 
MARXIAN SOCIALISM 189 
 
 the saddle, and they ride mankind.' The 
 manual workers were aware that their power 
 over conditions had greatly increased. The 
 nineteenth century had seen, decade after 
 decade, labour working for shorter hours with 
 a larger reward. Yet those in the ranks of 
 labour were told in fierce language that they 
 were suffering exploitation, and they were 
 easily roused to an antagonism to the wage- 
 paying class, when assured that their interests 
 would be favoured and secured. 
 
 A second reason for this sympathy with a 
 class war lies in the acceptance of the Marxian 
 doctrine that the manual worker creates all 
 values, and that, therefore, under this doctrine 
 of ' surplus value ' the capitalist oppresses 
 and depresses the labourer. It is true that 
 Marx, when he attempts definition, does not 
 limit the term labourer to the meaning of 
 ' manual worker.' ' By labour power, or 
 capacity for labour, is to be understood the 
 aggregate of those mental and physical capa- 
 bilities existing in a human being, which he 
 exercises when he produces a use-value of any 
 description ' {Capital, vol. i. p. 145). But in 
 his argument, as with the great majority of 
 coUectivists, Marx keeps in view only the 
 manual labourer and his wrongs. The average 
 socialist is unwilling to pay any special price 
 
190 THE QUEST OF INDUSTRIAL PEACE 
 
 for brains, because he has not yet realised 
 their contribution in production. We have an 
 illustration of this biased mind, produced by 
 the class consciousness, in the experience of 
 the European War. Numbers of soldiers in 
 the ranks held scornful views of the work of 
 the Staff. They understood their own most 
 honourable sacrifice, but did not realise how 
 necessary is the work of the Staff both for 
 saving life and for carrying on a successful 
 war. In the same way many workers seem to 
 think that the man who wields the hammer, 
 or holds the plough, or uses the broom, is the 
 real labourer, while the work of direction and 
 management is easy and imimportant. This 
 false conception has added an acid tincture to 
 the class consciousness, and given an unjustifi- 
 able argument to the popular demagogue. 
 
 The third reason is more important than it 
 seems. It is the objection on the part of some 
 who labour to be given ' orders.' The real 
 division in the popular mind, represented by 
 the two rhetorical labels bourgeoisie and pro- 
 letariat, is between those who 'give orders,' 
 and those who ' obey orders.' One may be 
 tempted to incline to anarchism so far as to 
 wish that ' orders ' disappeared from human 
 relationships, but that is to cry for the moon, 
 and a true and sane view of the work and the 
 
MARXIAN SOCIALISM 191 
 
 worker could dismiss this petty thought. Yet 
 it has been successful both in rousing antagon- 
 ism, and in giving birth to a number of foolish 
 attempts to escape this economic necessity. 
 One of these suggestions is that the worker 
 should pass from one position in the ranks of 
 industry to another, and, thereby, would give 
 orders on one day and obey orders on the next. 
 That idea was once advanced by Lenin, when 
 he declared that aU a man requires to fill any 
 post is an ordinary education, and that manage- 
 ment is simply bookkeeping. He no longer 
 cherishes this delusion, if he ever entertained 
 it. He has appointed autocratic and skilful 
 overseers, has chosen diplomatic ambassadors, 
 has gathered roimd him a permanent band of 
 despots, and has conscripted men for the army 
 and for the harder and dirty work of the com- 
 munity, from which they have no release. 
 This objection to obey orders is one of the 
 false and fallacious arguments of the Marxian 
 socialist. But a lie, as Thackeray has said, 
 when once the breath of life has been breathed 
 into it, is as potent as a truth, until men have 
 suffered for acting on it. If the accoimt of 
 suffering in the past, and of the suffering yet 
 to be endured could be made up, because of 
 this stupid and fallacious assertion, it would 
 amaze mankind. 
 
192 THE QUEST OF INDUSTRIAL PEACE 
 
 But these reasons, which are all based upon 
 this charge of exploitation either of labour, 
 or of its reward, or of its subordination, are 
 really beside the mark. The true ' exploita- 
 tion ' is not of labour, but of society. It is 
 the exploitation of the consumer which is the 
 real wrong. The consumer is continually 
 exploited and deprived of his freedom, not 
 only in demand but in use, both by labour and 
 by capital. His necessities are taken advan- 
 tage of both by those who give orders, and by 
 those who obey them. The capitalist who 
 becomes a profiteer, who makes a comer, who 
 raises prices, and the wage-earning labourer 
 who strikes and refuses to supply the coal, or 
 the transport, or the food, are both guilty of 
 exploitation. The real wrong in the social 
 order is the appropriation by individuals, 
 both the employer and the employee, of socially 
 created values. Now and again it is true that 
 the employee is exploited, and now and again 
 it is true that the employer is exploited, and 
 compelled to a dependence on, and subordina- 
 tion to a Trades Union, or to the caprice of an 
 individual workman. But in both cases the 
 final burden is borne by the consumer, and too 
 often both capital and labour combine in his 
 exploitation. One would think at times that 
 the real reason for any kind of production was 
 
MARXIAN SOCIALISM 193 
 
 to give work to the labourer, and profit to the 
 capitahst, with the result that the consumer 
 is left entirely out of account, and Uves in 
 dependence upon them both, and sometimes 
 in fear of their action. 
 
 11 
 
 Class war, therefore, when analysed^ is seen 
 to be a contest between employer and employee 
 in regard to the predominance and the profit 
 of each. The question which emerges is the 
 mode by which this war is to be waged. 
 One mode is by evolution ; the other by 
 revolution. 
 
 In the mode of evolution the features of the 
 present system, so far as possible, are to be 
 adapted towards the abolition of the capitalist 
 class. In many of Marx's writings that seems 
 to be the method that he favours, and some of 
 his arguments assert that Capitalism is digging 
 its own grave. There are passages in which 
 he forecasts the transformation of the depart- 
 ments of Capitalism into those of a coUectivist 
 state. At as late a date as 1872, in the Con- 
 gress of the International, at The Hague, he 
 declared himself willing to consider the mode 
 of evolution, through political change. ' We 
 do not assert that the way to reach this goal 
 is the same everywhere. We know that the 
 
 N 
 
194 THE QUEST OF INDUSTRIAL PEACE 
 
 institutions, manners, and customs of the 
 various countries must be considered. We do 
 not deny that there are countries, like England 
 and America, and if I understood your arrange- 
 ments better, I might even add Holland, where 
 the worker might attain his object by peaceful 
 means, but not in aU countries is this the case.' 
 It must be borne in mind that Marx had spent 
 many years in England, before he uttered that 
 mediating statement. Yet when we remember 
 the ringing sentences in the Manifesto — ' Com- 
 munists disdain to conceal their views and 
 aims. They openly declare that their ends 
 can be attained only by the forcible over- 
 throw of all existing conditions,' we realise 
 that Marx's convinced mode, and at least his 
 foreseen alternative, was revolution, not evo- 
 lution. 
 
 That is the mode resolutely adopted by Lenin. 
 ' At the present time the bourgeoisie and the 
 opportimists within the Labour movement are 
 co-operating in this work of adulterating 
 Marxism. They omit, obliterate, and distort 
 the revolutionary side of its teaching— its 
 revolutionary soul— and push to the foreground 
 and extol what is, or seems to be, acceptable 
 to the bourgeoisie.' (Lenin, The State and 
 Revoltdion, p. 1.) The truth is that while 
 Marx's teaching may be summed up in the 
 
MARXIAN SOCIALISM 195 
 
 words, ' Persuade and amend if you can ; if 
 not, give a knock-out blow,' most modem 
 Marxians have become assured that evolution 
 is the wiser mode, and the historic illustration 
 of the outcome of revolution in Russia has 
 enlightened and convinced many of the most 
 wilful-minded of Socialists. For it is clear 
 to most men that revolution is a mode of 
 violence which issues in bloodshed, economic 
 paralysis, and industrial beggary. It is as 
 clear to all who know the history of the nobler 
 civilisations that revolution, which is a blow 
 struck by a minority, is a denial of democracy. 
 It may be stated with confidence that, within 
 British dominions and in the United States of 
 America, the people are not willing to make a 
 bonfire of the home and of every ancient 
 institution, in order to clear the ground for a 
 new building whose plans have never yet been 
 drawn. 
 
 It must be recognised, however, that there 
 is a certain sympathy with this mode of revolu- 
 tion, and there are reasons for it which should 
 be noted. One of these is the psychological 
 influence of the European War. The method 
 of war used in those five years of awful strife 
 has bred a certain sympathy with violence. 
 Men have become wilhng to strike a swift and 
 instant blow tmhindered by either its wisdom 
 
196 THE QUEST OF INDUSTRIAL PEACE 
 
 or its morality. That blow may be an act of 
 assassination, a strike which wovild starve 
 millions of innocent people, or a repudiation 
 of the national debt which would wither the 
 credit of Great Britain in a single night, and 
 fiU the streets with masses of hungry and 
 unemployed. But men do not think of these 
 things. All their thoughts are held in thrall 
 by that method of war which swept the 
 German despotism out of Europe, but they do 
 not consider the curse it entailed. 
 
 Another reason is a lost patience with 
 parliamentary institutions and methods. 
 ' Freedom slowly broadening down from pre- 
 cedent to precedent ' seems to broaden too 
 slowly for many men's hot desires. They are 
 suspicious of the power of the capitalist in 
 parliamentary government, and even more 
 jealous of the leaven of Capitalism in the 
 hearts of the leaders of Collectivism, and 
 especially among the members of the Labour 
 Party who have taken office under the Govern- 
 ment. As a consequence all extremists are 
 eager to use the hot blast of passion, and to 
 hound on a minority to kindle a fierce fire 
 which will burn up the present social order. 
 
 But the barriers against revolution, in all 
 enlightened communities, are too strong to 
 be thrown down. In the hour when reason- 
 
MARXIAN SOCIALISM 197 
 
 able and patient-minded men realise not only 
 the fact that revolution is always, and only, 
 the mode of a minority, and that its issue is 
 never a stable peace, and its method always a 
 ruthless cruelty, it will be abandoned. In the 
 day when men realise that a new social order, 
 if it is to come, must ' grow,' and be registered 
 in laws and ordinances, it will be cast out of 
 men's minds. The first blow in a revolution- 
 ary assault has always roused the people to 
 the defence of parliamentary institutions. But 
 beyond that, the witness of history is decisively 
 a condemnation against swift, sudden, and 
 violent revolution. The blaze of the French 
 Revolution of 1798 has not yet faded from the 
 heavens. The chaos which followed the events 
 in France of 1848 taught even Marx a lesson 
 which he never quite forgot. The creation of 
 the Russian Soviet, with its inhuman cruelties 
 and tyrannical enactments, has shed an in- 
 tense light on the methods of violence. English- 
 speaking peoples continue to believe in parlia- 
 mentary government on a democratic basis. 
 As Kautsky has said, the final distinction 
 between the two methods of evolution and 
 revolution is that between a democracy and a 
 dictatorship. The class war, with its goal 
 of a dictatorship, is seen to be the broad road 
 to impoverishment, enslavement, and tyranny, 
 
198 THE QUEST OF INDUSTRIAL PEACE 
 
 and there can be no peace in industry, even no 
 steadfast industry at all, tmtil the passions 
 which surge behind the class war have been 
 purged out of men's hearts. 
 
 Ill 
 When we consider the goal to be attained 
 by the class war, so that the demand made by 
 Marx may be realised, we wonder that such an 
 ultimate was ever stated. The dictatorship 
 of the proletariat is a phrase which carries its 
 condemnation on its face. The world will 
 never submit in quietness to any dictatorship. 
 It is amazing to find men who make a fierce 
 protest against tyranny proposing to give to 
 a class the right of dictatorship. When it is 
 remembered that this claim is made because 
 the class is composed of manual workers the 
 amazement is deepened. Bernstein, the most 
 courageous Marxian, makes a convincing pro- 
 test. ' Is there any sense, for example, in 
 maintaining the phrase of the dictatoi^hip of 
 the proletariat at a time when, in all possible 
 places, representatives of social democracy 
 have placed themselves in the arena of parlia- 
 mentary work. The dictatorship of the classes 
 belongs to a lower civilisation. Apart from 
 the question of the expediency and practica- 
 bility of the thing, it is to be looked upon as a 
 
MARXIAN SOCIALISM 199 
 
 reversion, as political atavism. The whole 
 practical activity of social democracy is directed 
 towards creating circumstances and traditions 
 which shall render possible and secure a tran- 
 sition, free from convulsive outbursts, of the 
 modem social order into a higher one.' {Evolu- 
 tionary Socialism, p. 146.) 
 
 This conclusive political objection is sup- 
 ported by the economic facts. It rests upon 
 the conception that the change from a capitalist 
 to a collectivist order is merely the writing in 
 of the name of the State in the column where 
 the names of individual owners appear. It 
 asserts that the State would carry on the 
 industry of the coimtry, both in its national 
 and international aspects, with more wisdom 
 and more profit, and with most beneficial 
 results to the well-being of the whole com- 
 munity. But all this ignores what a dictator- 
 ship really means. Quite apart from the fact 
 that it would take away from the individual 
 the chief incentive both for effort and for 
 economy, it fails to realise that State manage- 
 ment and State trading are never economical 
 methods of carrying on any industry. Beyond 
 this it seems to forget that industry is no longer 
 a self-contained national interest, but must 
 face the whole world of supply and demand. 
 Still more forbidding is the truth that a die- 
 
200 THE QUEST OF INDUSTRIAL PEACE 
 
 tatorship has no time to persuade, but must 
 command, and even commandeer both labour 
 and capital. The dictatorship of the pro- 
 letariat might strip the capitalist bare, but it 
 woidd harness the labourer to a place in the 
 pack of dogs who draw the sledge of the State, 
 now with the whip of force and again with 
 the lash of hunger. The average, honest- 
 minded, working man has only to realise the 
 economic issues of a dictatorship to reassert 
 his protest against it. 
 
 There is a modem proof of all this which is 
 fatal as soon as it is perceived. A dictatorship 
 of the proletariat centres upon and focuses 
 into a bureaucracy. A bureaucracy is the 
 most self-sufficient, the most dominating, and 
 the most wasteful mode of government. A 
 bureaucracy is always impelled by the supreme 
 motive of entrenching itself in power, and of 
 increasing both its wealth and its ease. The 
 average tax-payer of this country realises that 
 the bureaucracies imposed upon it during the 
 war cannot be dislodged, even by strenuous 
 assaults, and they seem intent on keeping 
 their well-paid seats of privilege, in spite of 
 public protest and parliamentary appeal. That 
 is the most glaring truth in the history of the 
 Russian bureaucracy under Lenin and Trotsky. 
 Mr. Ramsay Macdonald, after his visit to 
 
MABXIAN SOCIALISM 201 
 
 Russia, wrote, ' The Moscow Executive has 
 formed itself into a Council of Cardinals, and 
 arming itself with the powers of excommunica- 
 tion, has proceeded to rule the State.' That 
 is the issue of this specious claim for the 
 dictatorship of the proletariat. As with every 
 other College of Cardinals, the only persons 
 who are given a free and full and privileged 
 life are the Cardinals themselves. As soon as 
 the average man realises that this dictatorship 
 holds such a weapon in its hand its doom will 
 be sealed. 
 
 IV 
 
 As we review Marxian Socialism its true 
 features stand out in clear light. The dictator- 
 ship of the proletariat is a political tyranny. 
 The class war is a denial of the dictates of 
 human brotherhood. The theory of surplus 
 value is an economic and stupid ignorance. 
 But the real and basic wrong, the moral and 
 spiritual darkness, is to be foimd in the doc- 
 trine of the materialistic interpretation of 
 history. That reveals Marx's estimate of 
 values, and his deep and fierce antipathy to 
 the supremacy of the moral values of life. It 
 is the doctrine of a spiritual apostasy, holding 
 in its bosom the denial of the realm, and the 
 power, of the spirit of man. There is no 
 
202 THE QUEST OF INDUSTRIAL PEACE 
 
 economic industrial doctrine which is so com- 
 pletely anti-Christian as that of Karl Marx. 
 When he wrote ' Law, morality, and religion, 
 are merely so many bourgeois prejudices, 
 behind which as many bourgeois interests are 
 concealed,' he reveals how intensely hostile 
 he was to the Christian moral ideal. Marx 
 was a de-hebraised Hebrew, and as history 
 declares with imfaltering witness, there is no 
 more sordid apostate among men. The reason 
 why the name of Christ who, in times gone by, 
 was claimed as one who was sympathetic with 
 the socialistic ideal, is now never mentioned, 
 is this — ^that Marx has conquered the hearts of 
 men with his materialistic conception of Ufe. 
 Men who look into a blazing furnace lose aU 
 power of discerning the glory of a simrise. 
 Men whose ears are fiUed with the clang of 
 tools lose all power to hear the finer harmonies. 
 Men whose appetites are stirred up for gross 
 delights lose all taste for purities. So also 
 Marx's arousing of the passions of material 
 greed has extirpated the nobler affections of 
 the soul. Yet we must not forget that what 
 has given Marxian Socialism its entrance into 
 the minds of labouring men has been the 
 undoubted wrongs they have suffered. Those 
 wrongs, as Marx saw them, have been greatly 
 altered both in their incidence and spirit. 
 
MARXIAN SOCIALISM 203 
 
 The details he engrosses in Capital are no 
 longer accurate, and have no bearing on the 
 case to-day. Yet it must be kept in mind 
 that, until justice and a recognition of the 
 personahty of every individual man, and of 
 the obligations both of capital to labour, and 
 of labour to capital, become both the law and 
 the habit of every realm, men will be accessible 
 to these economic and political fallacies, to 
 their own undoing and to that of the State. 
 No ' system ' of industry can bring in peace. 
 What is needed is a brotherly co-operation in 
 impartial justice and discriminating mercy, 
 and that can come only through the great 
 Personality, who has taught men both righteous- 
 ness and peace. That is not a vague aspira- 
 tion. It is the only method to which history 
 has set its seal. 
 
XI 
 
 ANARCHISM, SYNDICALISM, AND 
 GUILD SOCIALISM 
 
 The demand of the unfaltering Marxian 
 socialists is State Socialism in its uncompromis- 
 ing form. From this full demand a large 
 number of those who claim the name of 
 socialist have broken away. Some of his 
 immediate disciples have called for a revision 
 of his principles. Engels, his most intimate 
 friend, revised and softened his extreme posi- 
 tions. Bernstein questioned his postulates, 
 and refused to sanction some of his methods. 
 Other advocates of large changes in the present 
 social order have passed on to more definite 
 positions. But all of these unite as being 
 anti-capitalist, and as unwilling to trust en- 
 tirely to an enfranchised democracy. They 
 differ from Marxian Socialism in their con- 
 ception of the State. They realise as Schaffle 
 has pointed out, that State Socialism may 
 aspire to social freedom, but it must always 
 deny the freedom of the individual to live out 
 his own individuality, and to develop himself 
 
 204 
 
ANARCHISM, SYNDICALISM, SOCIALISM 205 
 
 according to his own ideals. So they affirm 
 that any regimentation of the individual must 
 be exercised, not by the State, but by a man's 
 associates in labour. These currents of thought 
 have broken into three streams — ^Anarchism, 
 Syndicalism, and Guild Socialism. 
 
 I 
 
 Anarchism is a term to which Proudhon gave 
 currency in his What is Property P published 
 in 1840. The word derived from dv contrary 
 to, and dpxq authority, must not be identified 
 with anarchy, although a statement of its 
 method and a list of its crimes would almost 
 justify such an interpretation. It is a demand 
 for a social order based on freedom, and, 
 therefore, on a protest against authority. 
 Monarchy, oligarchy, hierarchy, and even 
 patriarchy are disowned. A democratic re- 
 public is also outside the pale, for it implies 
 government by authority. Anarchism, with 
 its demand for the absolute freedom of the 
 individual, and its refusal to accept the govern- 
 ment of the State, stands in face-to-face opposi- 
 tion to Marxian Socialism. 
 
 It lays down three postulates. The first is 
 the attainment of a social order, not by obedi- 
 ence to law, but by free agreement between 
 associations of workers, constituted for the 
 
206 THE QUEST OF INDUSTRIAL PEACE 
 
 supply of the necessities of a modem civilisa- 
 tion. The second is the assurance that, under 
 this principle of free association, the individual 
 would enter with uncoerced will into a loyal 
 share in all the social activities. He would 
 take an entirely ethical conception of his life, 
 his work, and his fellow men. He would not 
 be damaged or degraded in his personality, or 
 oppressed in his liberty. Neither a capitalist 
 monopoly nor a body of State dragoons would 
 give him orders. In the free exercise of his 
 powers he would develop his faculties, realise 
 his manhood and, in his emancipation, attain 
 to peace. The third postulate is that this 
 voluntary association in labour would develop 
 into an interwoven network of labour groups 
 who would promote the other social interests 
 of life — sanitary, educational, artistic— and 
 this would consummate in a complete associa- 
 tion for the fulfilment of international 
 relationships. 
 
 To these three postulates some anarchists, 
 if not all, add a method. They advocate 
 violence as a means ' of effecting the changes 
 necessary to introduce this free and harmoni- 
 ous industrial and social order.' This is not 
 an inevitable constituent of Anarchism. It 
 is adopted by some only as ' propaganda by 
 deed.' It may be the assassination of an 
 
ANARCHISM, SYNDICALISM, SOCIALISM 207 
 
 emperor, or the expulsion of a State bureau- 
 cracy, or the adoption of a general strike, but 
 these deeds of violence would ' advertise ' the 
 ideal of the anarchist, and remove the impedi- 
 ments to its realisation. 
 
 Anarchism has had an ancient history. It 
 appeared among the Epicureans and the Stoics 
 who made protest against the unfaltering 
 authority of Plato's Republic. It reappeared 
 among the Anabaptists after the Reformation. 
 The passion for liberty so captivates some 
 minds as to blind them to its conditions and 
 its perils. But modern Anarchism is a pro- 
 duct of the eighteenth century. It made its 
 voice heard in the French Revolution, and 
 found a sympathetic advocate in England when 
 Godwin expounded it in his Inquiry concern- 
 ing Political Justice in 1793. As might be 
 expected, Proudhon gave it, in 1840, his assent 
 in his protest against Communism. In the 
 United States it has broken out in sporadic 
 fires, but the strength of the democratic con- 
 victions of the people have stamped it out. 
 It has received its systematic exposition from 
 Max Stimer in his Individual and Property, 
 in 1840. But its most notable advocate was 
 Bakunin (1814-1876), who became Marx's re- 
 lentless opponent. There is evidence that a 
 personal rivalry and a keen antipathy animated 
 
208 THE QUEST OF INDUSTRIAL PEACE 
 
 them both. In the embittered conflict, at 
 the Hague Congress of the International in 
 1872, Bakunin and his followers were out- voted 
 and expelled by the Marxian party. His 
 anarchist theories found a congenial soil only 
 in his native Russia. Under the pitiless 
 government of the Czar they seemed to be, 
 to the cruelly oppressed people, the only pos- 
 sible protest against a despotism. Anarchism 
 has received intense and vivid exposition in 
 Russian literature, and especially in the works 
 of its well-known noveUsts, who use a story 
 to denounce a wrong and to advocate a political 
 change. Their most distinguished propagand- 
 ist was Prince Kjopotkin, who died in January 
 1921, almost eighty years of age, a disappointed 
 and forgotten man. 
 
 Anarchism has never been brought to the 
 test of experience. Men are assured that 
 the judgment of history would approve the 
 condemnation passed so universally both by 
 reason and conscience. It accepts a view of 
 the goodness of human nature which neither 
 psychology nor the experience of life allows 
 the ordinary man to hold. Its method of 
 freedom seems to most men the broad way of 
 individual licence and social degradation. 
 Anarchism has never even suggested a method 
 of dealing with the passion-driven or the 
 
ANARCfflSM, SYNDICALISM, SOCIALISM 209 
 
 criminal, or with the man who will use his 
 freedom to indulge propensities which are 
 selfish and self-indulgent. Few practical 
 minds can be assured that Anarchism has an 
 economic justification. A society dependent 
 upon the inconstant, easily-tempted, and en- 
 tirely self-directed will of the individual, holds 
 out little prospect of such steadfast co-opera- 
 tion as wiU provide the necessities of life. A 
 social order imder Anarchism seems to most 
 men only a hazier and more visionary Utopia. 
 
 The fallacy at its base is its misapprehension 
 of the meaning and the power of freedom. 
 It assumes that a perfect freedom has a 
 regenerating and inspiring force. But freedom 
 has no positive ethical content. It really 
 means opportunity. A man who is free, is 
 free both to do evil and to do good. The 
 individual must be given this freedom, or he 
 can be neither evil nor good. But a social 
 order cannot be based on the condition of the 
 untrammelled freedom of every individual 
 within it. The first requisite of any social 
 order is some agreement on its ethics and 
 economics, to which the individuals must 
 consent to be conformed. Without this agree- 
 ment Anarchism, as has been historically 
 proved, becomes anarchy. Every man does 
 that which is right in his own eyes. A civilisa- 
 
210 THE QUEST OF INDUSTRIAL PEACE 
 
 tion, which is a social order based on impartial 
 justice, security, toleration, and agreement as 
 to what is right, is impossible luider an Anarch- 
 ism which declares that, given freedom, men 
 may do as they will. Paul preached such a 
 perfect liberty to Christian men, but it was a 
 liberty only for those who had accepted Christ, 
 were indeed slaves to Him—' imder law to 
 Christ.' But Anarchism beUeves that, given 
 liberty, men will come to agree in what is 
 good and labour imselfishly for it. There is 
 no proof but rather abundant disproof of 
 such a conception. The chief interest of 
 Anarchism to-day Ues in its protest against 
 the despotism of Marxian Socialism— not in 
 its affirmations. 
 
 II 
 Syndicalism is a social order based upon the 
 organisation of the workers of various trades, 
 or groups of related trades, to carry on industry. 
 The term is derived from the French word 
 Syndicat, which means an organisation of 
 labourers. Under Syndicalism there would 
 be no capitalists and no masters, but freely 
 associated groups of workers who would carry 
 on and control all industries. These groups 
 would federate volimtarily into larger wholes, 
 and would finally combine to form a national 
 
ANARCHISM, SYNDICALISM, SOCIALISM 211 
 
 society. In one aspect it is a return to Marx, 
 for it rejects the interpretation of Marx by 
 the Revisionists, who deny that Marx com- 
 mended revolutionary methods. It reaffirms 
 the class consciousness of the proletariat, and 
 advocates the use of violence in order to 
 remove the impediments to the creation of an 
 industrial order in which the workers would 
 bear authority, but it refuses to give to the 
 State that supremacy which Marx demanded. 
 The Syndicalists are assured that, under this 
 system, the labourer would enter into freedom, 
 reahse his personality, and enjoy a full and free 
 life — a. life open to the worker, and to no one 
 else. 
 
 This theory is a product of revolutionary 
 France, and finds its supporters chiefly among 
 the people of the Romance countries. One of 
 its inspiring personalities has been PeUoutier, 
 who is in succession to the schools both of 
 Proudhon and Bakunin. Its most courageous 
 expositor is Georges Sorel, whose Reflections on 
 Violence, with its illuminating prefatory letter to 
 Daniel Halevy, gives the clues to the denials, 
 ajB&rmations, and demands of Syndicalism. 
 
 This theory had its source and spring in a 
 sense of disappointment at the failure of all 
 ameliorative attempts to better the condition 
 of the workers and to give them independence. 
 
212 THE QUEST OF INDUSTRIAL PEACE 
 
 It admits that the working classes have had 
 their social and economic conditions vastly 
 improved during the second half of the nine- 
 teenth century. It recognises that their wages 
 have increased, their dwellings become larger, 
 roomier, cleaner, and their comforts and 
 pleasures been greatly multiplied. But it de- 
 clares that their emancipation and self-realisa- 
 tion seem as far off as ever. As a consequence 
 the syndicalists, about the dawn of the present 
 century, came to the conclusion that no 
 market-bargaining and no parliamentary action 
 would attain the end. The worker must be 
 given economic power, and be set in the seat 
 of authority. Sorel discerned that one power- 
 ful weapon had been forged, but had not been 
 fully used. That was the method of the 
 strike. There had been strike after strike, 
 and certain advantages had been secured, but 
 the great aim had not been achieved. He 
 gave the counsel to adopt the General Strike, 
 that is to assail the present order by a universal 
 uprising of labour, to seize the means of liveli- 
 hood, even although that must be done by a 
 minority, and the capitalist class would be 
 compelled to abdicate.^ The wealth of the 
 capitalist, the form of government he had 
 
 > Sorel's conception of the power of this weapon of the Strike, 
 as with all unthinking Labour leaden, overlooked the truth that 
 it hag no power in a time of declining induatry. 
 
ANARCHISM, SYNDICALISM, SOCIALISM 213 
 
 fashioned, and the religions which buttress his 
 position would be swept away. Government 
 by Syndicats, in the interests of the workers, 
 would come into being. He counsels the 
 necessity of the inspiration of the worker with 
 a deeper passion for his own well-being. He 
 bids the worker beware of the intellectual 
 power and subtlety of the middle classes, and 
 of the adroit methods of parliamentary action. 
 If the syndicalist policy, he maintains, were 
 carried out, the State would be abolished and 
 the workers set in authority so as to recon- 
 struct the social order in the interests of the 
 workers alone. 
 
 Syndicalism can hardly bear the results of 
 an exposition. Not only is it doctrinaire, 
 as French theories are apt to be, but it loses 
 sight of the greatness of the issues at stake, 
 and of the meaning of ' the day after ' a 
 revolution by force. It has no perception of 
 the complexities of the problem of modern 
 industry. The increasing technicality, the 
 need of constant adaptation, the scrapping 
 of old methods and machineries, the ever- 
 enlarging area of world-wide enterprise, and 
 the international relationships involved, are 
 left out of account in this swift and fierce and 
 clean-cut method of reorganisation. It does 
 not realise that no one method can be adapted 
 
214 THE QUEST OF INDUSTRIAL PEACE 
 
 to all industries. It does not seem to be in 
 sight of the problems created by the ever 
 continuing growth of the population in the 
 industrial centres. France is the land of the 
 petite culture, with its village and county town, 
 and the syndicalist seems to be always and 
 only thinking of Normandy. He does not 
 perceive that there are departments of service 
 in our modem civilisation which cannot be 
 classified into groups, and cannot be squeezed 
 into compartments, so that, even were a 
 minority to seize the capital and the organisa- 
 tions of trade by force, there are many indus- 
 tries which cannot be enrolled in any strait- 
 jacket scheme, and there are multitudes of 
 men and women who will never consent to 
 the action of a press-gang, which allocates 
 their work and their place. Violence is never 
 the first chapter of a stable history. Constitu- 
 tions and organisations cannot be made with 
 a saw and a hammer. 
 
 One other critical remark is more fatal than 
 it may seem. Sorel faced a truth which has 
 been often overlooked, but he did not obey 
 its demand. That truth is that a social order 
 can come into being, and grow into power, only 
 as it is inspired by a new spirit. Sorel realised 
 that only a passion which has become a religion 
 has dynamic enough for his purpose. He 
 
ANARCHISM, SYNDICALISM, SOCIALISM 215 
 
 perceived that ' the epic state of mind ' was 
 required for the emancipation of the worker. 
 But he conceived that an assault on society, a 
 class war, would regenerate the soul. With 
 Nietzsche he believed not so much in a war for 
 a good cause, as in ' a good war in any cause.' 
 He instanced the fact that at the call of war 
 men rose up in heroic action, that Mahomet 
 breathed a relentless and fearless passion in 
 his followers until they died in heaps, and that 
 in a more prosaic way, inventors toiled and 
 strained in their effort to overcome the obstacles 
 to their designs. But Sorel forgot that in 
 reality a war merely quickens a spirit which has 
 already been born, that Mahomet lured his 
 followers by promises of sensuous delights, and 
 that the inventor is inspired, not by the diffi- 
 culties, but by the hopes which throb in his 
 heart. No passion can become a lasting 
 religion which is not baptized into unselfish- 
 ness. When a passion does become a religion, 
 it will not make class distinctions, and, in this 
 twentieth century, it will not be easily led to 
 violence or to sanction a general strike to the 
 starving of women and children. The Christian 
 ethic may not be accepted by syndicalists as 
 they think out their methodical and ruthless 
 methods. But it has so enhghtened the con- 
 science of humanity, that both Syndicalism 
 
216 THE QUEST OF INDUSTRIAL PEACE 
 
 and the way to it are impossible within 
 Christendom. 
 
 in 
 GuUd Socialism is the English fonn of 
 Syndicalism, with some marked distinctions. 
 Anarchism finds its advocates chiefly among 
 men of the Russian type of mind. Syndical- 
 ism appeals to those who inherit the ideals and 
 the modes of thought of the Western conti- 
 nental peoples. But Guild Socialism, with its 
 notes of compromise and practicabiUty, is 
 germane to the mind of the Anglo-Saxon. 
 All three have an inward relationship. Anarch- 
 ism would abolish the State because it resents 
 external authority. Syndicalism would de- 
 velop the Syndicats imtil, by their voliuitary 
 federation, they could fulfil the function of the 
 State. Guild Sociahsm would confederate all 
 the groups of workers and conmiit to them the 
 control of industry. But it would retain the 
 State and allot to it all pohtical functions. The 
 citizens of a world-wide empire, who have 
 been bred to the traditions and trained in the 
 methods of parUamentary government, cannot 
 conceive that the justice, security, and tolera- 
 tion which a civiUsed community requires can 
 be maintained apart from the authority of the 
 State, 
 
ANARCHISM, SYNDICALISM, SOCIALISM 217 
 
 The name of Guild Socialism has been taken 
 from the somewhat different ideal of the 
 medieval guilds which were associations of 
 craftsmen and traders carrying on business on 
 their own account. The root ideas in both 
 cases are a special care for the interests of each 
 trade or guild, and a jealous guardianship of the 
 independence and privileges of the members. 
 For that reason it aims at a social and poUtical 
 order in which each industry shall have com- 
 plete control and management of its own pro- 
 duction and distribution. To avoid small 
 guilds, the formation of related industries into 
 large groups is advocated. The confederation 
 of these large groups would form the final 
 authority for the control of labour. The State 
 would not pass away, for it would become the 
 most important of the groups as it fulfilled a 
 specific political function. Its relationship to 
 the guilds would be the ownership of the 
 means of production, without right of un- 
 solicited entry into the management of the 
 industry. 
 
 The first problem, it is recognised, is the 
 transformation of the present capitalistic order 
 into this dualism involved in Guild Socialism. 
 The most inviting way is by the development 
 and co-ordination of the existing Trades 
 Unions. They would be enlarged so as to 
 
218 THE QUEST OF INDUSTRIAL PEACE 
 
 include the oversight of all labour. The com- 
 plement of this step would be to transfer the 
 ownership of the wealth of the capitalist to the 
 State. The only justification for the capitalist 
 is that he shall fulfil a function, but in and 
 by such transference his function would be 
 gone. The result would be the abolition of 
 'the master,' the freeing of the wage-earner 
 from dependence and subordination, so that 
 the worker could express himself and develop 
 his personality. It is to be noted that the 
 justification of Guild Socialism on the part of 
 most of its advocates is this ethical ultimate, 
 and that, it must be remembered, is the real 
 driving force of all the theories and projects 
 which are aiming at industrial equilibrium in 
 the hope of attaining social and political 
 peace. 
 
 When we examine this project, for it is 
 nothing more than a project, some obvious 
 difficulties appear. One of these is the assump- 
 tion that the transference of the capitalistic 
 order would be not only a possibility but a 
 simple and easy possibility. It would be a 
 revolution, and revolution lends itself to 
 rhetoric, but the forces it employs and the 
 forces it arouses come to a conflict which is 
 really war. From some references the writers 
 seem to think that it would be no more 
 
ANARCHISM, SYNDICALISM, SOCIALISM 219 
 
 difficult or serious than the changing of the 
 scenery between the acts of a play. Another 
 feature to be remarked is that the advocates 
 of Guild Socialism, like other socialists, keep 
 their eyes on the manufalCturing industries 
 and ignore those which require a more indi- 
 vidual and personal oversight, and leave out 
 of account still more completely the far-flung 
 interests and delicate relationships of a world- 
 wide commerce and a world-wide finance. As 
 much to be questioned is the conception of 
 human nature which is assumed. It seems to 
 be accepted, that if the workers were ' emanci- 
 pated ' and placed in the seat of control, they 
 would slough off all the faults and evil habits 
 and vices so sadly prevalent. The guildsman 
 would become loyal, eager, resourceful, with- 
 out personal rivalry or striving for pre-emin- 
 ence. A moral miracle has never been wrought 
 in that way. Nor would Guild Socialism, in 
 which, as in every other order, some would 
 command and some would obey, be able to 
 promise that such a decisive change in human 
 nature could he so simply achieved. 
 
 But apart from these initial impediments 
 which are the real barriers to its acceptance by 
 practical men, there are other and deeper 
 objections. One is a denial of the idea that a 
 man's life and liberty, and the realisation of his 
 
220 THE QUEST OF INDUSTRIAL PEACE 
 
 personality, can be stated and fulfilled in the 
 exercise and conditions of his labour. That 
 is really a reversion to the Marxian conception 
 that a man's life is dependent on the manage- 
 ment of his tools and the enjoyment of the 
 product of his labour. The centuries have 
 taught that the secret of well-being lies in 
 deeper satisfactions than can be given by a 
 man's daily work, be that what it may. There 
 is no subtler degradation than that of the man 
 who realises and expresses himself, entirely 
 and absorbingly, in the work of a business. 
 His higher instincts are atrophied, and the 
 whole roimd of nobler interests lie beyond 
 his care. 
 
 Another objection is that to commit the care 
 and oversight of any industry or trade to a 
 Guild leads that Guild to be motived by a 
 selfish regard for the interest of its members 
 without care for the well-being of the com- 
 munity. As a consequence each Guild would 
 be tempted to promote its own specific interests 
 against those of the other Guilds. That has 
 been proved in the now historic fact that the 
 three largest Trades Unions, viz. the miners, 
 the transport workers, and the amalgamated 
 engineers, formed a Triple Alliance and 
 threatened to organise a strike which would 
 impoverish the State and starve the workers 
 
ANARCfflSM, SYNDICALISM, SOCIALISM 221 
 
 in other industries. It received a more de- 
 cisive proof in the withdrawal of the transport 
 workers and the amalgamated engineers from 
 the miners when the action of the miners in 
 calling a strike without a goodwill toward 
 negotiation was disapproved. Each Guild for 
 itself would tend to become the potent, if un- 
 written law. Ruskin makes his protest against 
 this historic fact and its inevitable repetition. 
 Speaking of the decay of the ancient Guilds, he 
 writes, ' I perceive the real ground of their 
 decay to have lain chiefly in the conditions of 
 selfishness and isolation which were more or 
 less involved in their vow of fraternity, and 
 their laws of apprenticeship. I must warn 
 you very earnestly against the notion of co- 
 operation as the policy of a privileged number 
 of persons for their own advantage. You 
 have this land given you for your work that 
 you may do the best you can for all men ; and 
 more in the spirit of a body of monks gathered 
 for missionary service, than of a body of 
 tradesmen gathered for promotion even of the 
 honestest and usefullest trade.' {Fors Clavigera, 
 Letter btxix.) 
 
 A still greater objection hes in the peril, 
 indeed the certainty of a more disastrous con- 
 flict. If a Guild or a number of Guilds were 
 to take action, which the State carrying out 
 
222 THE QUEST OF INDUSTRIAL PEACE 
 
 its political function would refuse to sanction 
 on the ground that it imperilled the wealth of 
 the community, a conflict in the most acute 
 form would arise. By the theory the State 
 is the owner of the wealth and, therefore, of a 
 certain amount of power. The conflicts we 
 have to-day are ultimately between the State 
 and capital, or the State and labour. But these 
 conflicts are amenable to law because neither 
 capital nor labour have been placed in the 
 privileged and almost omnipotent position 
 which Guild Socialism would bestow on labour 
 through the Guilds and on capital through the 
 State. An even subtler source of dispeace 
 lies in the fact that since the Guild and all 
 guildsmen have their interest focused merely 
 on labour, the immediate incentive to save 
 capital would be taken away. Each Guild 
 would be eager to have the use of as much 
 capital as could be secured from the State, with 
 the obvious result that the general wealth of 
 the community would be imperilled. If, under 
 present conditions, capital is not saved but is 
 wickedly preyed upon by officials, how much 
 greater would be the waste and selfish appropri- 
 ation of the possessions of the State to advance 
 the interests of conflicting Guilds. 
 
 One other objection must be noted. Guild 
 Socialism claims to be based upon democratic 
 
ANARCHISM, SYNDICALISM, SOCIALISM 223 
 
 principles. But can a democracy take any 
 real part in the administration and manage- 
 ment of industry ? To appoint men to a 
 Board of Directors, to form a committee who 
 would be in touch with the details of pro- 
 duction and distribution, to appoint shop- 
 stewards, have all a measure of excellence, and 
 they have been adopted. But such approaches 
 to oversight do not constitute management 
 and control. Management is leadership, and 
 leadership requires technical knowledge, a rare 
 and supreme ability and a power both of fore- 
 sight and of decision in every hour of the day. 
 Such authority can be given under a democracy. 
 But as is so clearly set down in the constitution 
 of the United States, when once it is given it 
 must be obeyed. There would be, as in every 
 Other constitution, those who give orders and 
 those who obey them. As long as this remains 
 one of the facts of life it must be accepted, and 
 the sooner men abandon that false and snob- 
 bish ideal that to serve degrades and enslaves, 
 the sooner will men cease to form and advo- 
 cate fantastic ideals. It can be said without 
 offence that the majority of the advocates of 
 Guild Socialism are drawn from those members 
 of the community who are not busy either in 
 the industry or the commerce of the country. 
 They belong to the educated and soft-handed 
 
224 THE QUEST OF INDUSTRIAL PEACE 
 
 class. They are not intimate, by daily life, 
 with the manual labourer, and are imaware 
 that he is not moved by an abiding passion 
 for a greater share in the control of industry 
 or by high-flying theories of the State and its 
 relationship to industry. The average work- 
 ing man has no use for the term ' wage-slavery.' 
 He desires a more evident justice, a more 
 assuring security in life, a larger share of the 
 product and an ampler leisure, and his practical 
 mind has realised that these desirable things 
 are not to be given by any scheme of hfe which 
 some man constructs in his study. Any one 
 living in close contact with working folk is 
 aware that the emancipation they wish is 
 not from leadership and oversight, but from 
 that fear and hardship of conditions of work 
 and reward which the present laws may be 
 fashioned to secure. Even were it true that 
 men did believe that true freedom is to be 
 found in a self-assertive control of the con- 
 ditions of industry, the truth lies rather, as 
 Sorel declared, that freedom is of the spirit, 
 and is found in the great offices of the mind 
 and the soul as the Christian ethic maintains. 
 A man may serve in the humblest of vocations 
 all life through, and yet be a freeman as the 
 most imperious autocrat never has been. 
 
XII 
 
 THE NATIONALISATION OF INDUSTRY 
 
 The discussion of Nationalisation has suffered 
 from some misconceptions of its essential 
 features. It is sometimes regarded as Socialisa- 
 tion. One of the reasons for this confusion is 
 that many of its advocates are socialists, and 
 they are eager and urgent in their demand 
 because they regard Nationalisation as a 
 strategic move in their assault on Capitalism, 
 and an instalment of their programme, which 
 would pave the way to their goal. But 
 Socialisation means the State ownership of the 
 capital, and its management and control of 
 aU the industries in production, distribution, 
 and exchange. NationaUsation surveys a more 
 limited field. It advocates the ownership of 
 the capital by the State only in certain large 
 activities, but it does not always pass on to 
 the demand that these shall be controlled and 
 managed by State officials. There are rail- 
 ways in India, for instance, which belong to 
 the Government, but they are worked by a 
 company which lease them from the State. 
 
226 THE QUEST OF INDUSTRIAL PEACE 
 
 Another confusion is made between Nationalisa- 
 tion and Municipalisation, and an argument 
 is drawn from the success of civic to that of 
 national enterprise. Apart from the simple 
 necessities and direct control in the limited 
 area of a city, the problems differ in their 
 complexity. But many others, who are keenly 
 opposed to Socialism, entertain the conviction 
 that Nationalisation can be wisely and profit- 
 ably adapted to some departments of public 
 service and common supply. 
 
 I 
 
 At the outset we shall consider the spheres 
 of industry or activity for which Nationalisa- 
 tion has been proposed or suggested. They 
 are seven in number. These seven include 
 the Post Office, with its related services ; the 
 railway system, the mining industry, the 
 ownership and cultivation of the land, and 
 the shipping services, the banking system, and 
 the liquor trade. 
 
 Three of these — ^the liquor trade, the banking 
 system, and the shipping services, may be ruled 
 out as being beyond the present horizon. 
 Were the State to attempt to carry on the 
 liquor trade, it might mitigate some of the 
 present abhorrent evils, but it would fasten 
 the traffic round the neck of the nation with a 
 
THE NATIONALISATION OF INDUSTRY 227 
 
 twice - riveted chain. Even the attempt to 
 nationalise such a traffic would arouse the 
 consciences of millions of sober-minded men 
 and women and lead them to a perilous revolt. 
 As was shown in Scotland in the past year the 
 division of opinion is intensely keen, and the 
 trend of the national mind is rather towards 
 a limitation, if not a prohibition of the traffic, 
 so that its nationalisation is quite impracticable. 
 The banking system is also out of the picture. 
 In spite of some suggested advantages, the 
 possession of some private capital and the 
 elasticity in its use afforded by the present 
 method of banking, are invaluable. Beyond 
 this administrative gain it must be remembered 
 that finance is more than a national interest. 
 London remains the commercial focus of the 
 world. Nationalisation would confer on a 
 National government not only powers which 
 would limit freedom, but would shut the door, 
 simply because of the possession of these 
 powers, on a world-wide banking business. 
 A banking system under the control and 
 espionage of any National government might 
 write its international investors off its books. 
 
 To these two debarred departments we must 
 add the shipping service. The highway of 
 the sea is open. Harbours give a welcome to 
 every flag. Competition is as healthful as it 
 
228 THE QUEST OF IKDUSTRIAL PEACE 
 
 is inevitable. The oversight of such a service 
 requires personal care, initiative, resource, the 
 swift decision to make ventures and to take 
 risks. The supply of vessels and of equipment 
 and the need of manning them, often by 
 foreigners and in foreign ports, require manage- 
 ment which cannot be confined within the red 
 tape binding of a national department. The 
 discussion, therefore, centres upon the postal 
 and the railway services, and ownership and 
 control in mining and agriculture. 
 
 As we consider these four departments of 
 industry some distinctions appear. The first 
 condition is that Nationalisation can be applied 
 to service rather than to production. The 
 manufacture of iron or steel, cotton or wool, 
 machinery or tools, and even of the multi- 
 tudinous household requisites, necessitates such 
 a variety of method, and is called upon to face 
 so many different customs and tastes, that no 
 system of Nationalisation yet conceived could 
 be adapted to the situation. The second 
 condition is that the service given must bear 
 the impress of a common utility and necessity. 
 One reason why education has become national- 
 ised is that it is merely a service, and a service 
 whose necessity and method have in great 
 measure received a common consent. But 
 Nationalisation cannot be applied to the pro- 
 
THE NATIONALISATION OF INDUSTRY 229 
 
 vision of luxuries, the gratification of individual 
 tastes, or the supply of commodities which 
 would provoke a selfish indulgence, or seem, 
 to great numbers, to waste the national wealth. 
 Nor can it be applied to the fulfilment of 
 religious or artistic or literary demands, for no 
 common agreement can be reached in these 
 imperative but most distinctive activities. A 
 thorough-going Socialism is helpless when it 
 faces such problems of life and endeavour. 
 
 The third condition is that Nationalisation 
 is possible only for a supply or a service in 
 which a monopoly can be maintained. If the 
 service is one which private enterprise is 
 allowed to undertake, it will do so, and it will 
 compete with, and present the success of 
 National management. The proof that 
 private enterprise can give such service more 
 cheaply has never been questioned. In the 
 same way Nationalisation cannot be continued 
 unless its monopoly be secured not merely 
 by law, but by the power of the State to 
 finance its cost, and to prevent any other 
 supply of its services. These conditions seem 
 to limit the spheres of Nationalisation to the 
 postal and railway services and to mining and 
 agriculture. 
 
280 THE QUEST /)F INDUSTRIAL PEACE 
 
 n 
 When we consider the Postal and its related 
 services we find them cited as conclusive 
 evidence for the success of Nationalisation. 
 But the evidence for this statement is seldom 
 examined. When looked at closely it is clear 
 that the Postal Service has not really been 
 nationalised. It depends to an amazing degree 
 on private capital and enterprise. The mails 
 are carried on railways, transported in ships, 
 sorted and delivered, in many instances, by 
 means of private agencies, and in vehicles and 
 premises which are privately owned. They 
 are carried along roads which have been made 
 and are kept in order by Town Councils and 
 County authorities. Were the whole system 
 to be actually nationalised, and to dispense 
 with all hired or unhired private service, letter 
 writing would become a rare and costly luxury. 
 Beyond that the Post Office system could not 
 have attained its present efficiency if it had not, 
 along with every other experiment of National- 
 isation and Municipalisation, stepped into an 
 inheritance bequeathed by the resourcefulness 
 of the private enterprise of the past. Any one 
 who will read the life of William Dockwra, a 
 London merchant of the seventeenth century, 
 will understand both the debt of the present 
 
THE NATIONALISATION OF INDUSTRY 231 
 
 system to the past, and the certainty that, 
 even yet, private enterprise would be cheaper 
 and more efficient than a nationahsed service. 
 It is sometimes forgotten that in spite of 
 its legacies and endowments the Postal Service 
 seldom pays its own way. The deficits of the 
 past few years have been due in great measure 
 to the enormous increase in the wages of em- 
 ployees. But the multiplication of officials 
 in administration — men and women treading 
 upon each other's heels, rendering little or no 
 service, and drawing large salaries — must bear 
 no small part of the blame. Sir Henniker 
 Heaton, the acknowledged expert, declared 
 that he could provide a world-wide postal 
 service at a penny an ounce, and deliver a 
 letter anywhere within the realm at a good deal 
 less than a halfpenny, and no one of Heaton's 
 averments failed in actual proof. This in- 
 creased costliness, so largely due to inefficient 
 management and heedless extravagance, is 
 even more apparent in the telegraph and tele- 
 phone services. Both of these were more 
 efficient, and both paid their way, under 
 private ownership and control. Now their cost 
 is making them so prohibitive that the plain 
 man cannot use them at all. The more recent 
 proposals imply that a telephonic communica- 
 tion will cost about three pence, if not more, and 
 
282 THE QUEST OF INDUSTRIAL PEACE 
 
 be secured only after enduring insolent dis- 
 courtesies. While it must be admitted that a 
 proportion of these increased charges is due to 
 the all-round cost of supply, yet a large per- 
 centage is owing to the wasteftJness of public 
 management, and to this darkest feature, that 
 there is a public purse into which officials may 
 freely dip. Thereby, the user of the service 
 pays over again through the taxes imposed by 
 the Chancellor of the Exchequer. 
 
 We have room for one other fact which is 
 strangely overlooked. The Postal Services are, 
 as we have seen, not really an example of a 
 pure nationalism. But it is even more de- 
 structive of a plea for Nationalisation that 
 they are dependent for their customers and 
 their supply on the present capitalistic order. 
 Those who use them are wage-makers and 
 wage-earners. Large industries conducted by 
 able and energetic men and staffed by thou- 
 sands of workers, who can spend their large 
 earnings after their pleasure, pay the major 
 part of the cost. Were Nationalisation to be 
 extended, and the workers in every industry 
 to become servants of the State, the basis on 
 which the whole system rests would be de- 
 stroyed. The revenue, coming so largely from 
 perfect freedom in earning and spending and 
 saving, would almost disappear, and the whole 
 
THE NATIONALISATION OF INDUSTRY 238 
 
 Post Office system, being non-productive, 
 would be a heavy burden on the community. 
 The Postal Service is the simplest and most 
 manageable of all. It has advantages in being 
 a common necessity and a sure monopoly. 
 But it does not prove itself a convincing witness 
 for Nationalisation. 
 
 Ill 
 When we turn to the Railway System there 
 is no need to recapitulate these objections 
 which seemed to refute, or at least discount, 
 the evidence adduced from the management 
 of the Post Office. The economic argument 
 against the transfer of the railways to the 
 State is as irrefutable, but it is confirmed by 
 other features which do not emerge in so 
 simple, so manageable, and so largely tooUess 
 a service as the Post Office. Railway trans- 
 port requires a more costly equipment and a 
 more skilled, technical and watchful manage- 
 ment, and, above all, it gives opportunities for 
 the waste both of labour and materials which 
 the Post Office does not afford. These features 
 become an actual source of danger to the State 
 because of the vast army of men and boys 
 who have become a distinct caste in the com- 
 munity, and because their action involves 
 every other national industry. The peril to 
 
284 THE QUEST OF INDUSTRIAL PEACE 
 
 the State from a nationalised railway system 
 has never been faced. Yet no one should 
 forget the railway strike in which, under 
 demagogue leadership, the army of railway 
 servants, in many cases most unwillingly, 
 were led out to a costly and losing battle 
 against the public good. It was a ' lightning 
 strike,' with the briefest possible notice. The 
 strikers were beaten, as they deserved to be — 
 the public conscience will always cow and 
 defeat a class interest in the end. But that 
 strike opened men's eyes to the tremendous 
 peril of nationalising the Railway Service, 
 and especially a service which is in a position 
 to seize industry by the throat. 
 
 The storm did not last long in Britain, but 
 it lasted long enough to show the consequences 
 to the State of Nationalisation, and to reveal 
 the ugly alternative when a struggle of this 
 kind becomes violent. In Nationalisation the 
 State government becomes a party to the 
 dispute. It is a judge in its own cause, with 
 no appeal to any other mediator. And it is 
 compelled to employ force on its own behalf 
 as a last necessity. Look at a simple proof 
 of this. The railway strike in Victoria, 
 AustraUa, in 1903, compelled its Government, 
 largely a Labour Government, to pass the 
 Railway Outlaws' Act, providing that railway- 
 
THE NATIONALISATION OF INDUSTRY 285 
 
 men leaving their work, without fourteen days' 
 notice, were to be subjected to a fine of £100, 
 or a year's imprisonment, besides losing their 
 pensions and retirement allowances, and all 
 rights which they enjoyed by reason of their 
 position as Government servants. They were 
 excluded from Government employ, except 
 by special intervention of the Railway Com- 
 missioners. The Act also made it illegal to 
 collect or distribute strike ftinds, pimished 
 intimidation of, or interference with, all men 
 on duty, and empowered the police to break 
 up any meeting of strikers attended by more 
 than four people. The strikers surrendered 
 unconditionally, and most of them, after a 
 time, were gradually taken back at the dis- 
 cretion of the authorities. 
 
 Mr. Tom Mann makes the following com- 
 ment in The Transport Worker for March 1913. 
 'The strikers were beaten to ashes. Then 
 came the brutality of the Government ; never 
 in my history have I known such merciless 
 treatment of the men who acted as the strike 
 executive. For seven years they were refused 
 work, although they appealed repeatedly. After 
 seven years the Government relaxed to this 
 extent that whereas they were the highest 
 paid men on the railways, they were now 
 allowed to apply for work under the depart- 
 
286 THE QUEST OF INDUSTRIAL PEACE 
 
 ment only as casual labourers. I was cured 
 for ever of any such superficiality as State- 
 owned railways.' 
 
 Two conclusive positions are reached. One 
 is that Nationalisation of such a key-service 
 as the railways involves the certainty of 
 strife, and the final issue of that strife is the 
 uprising of the State in its force — ^and the 
 State here is merely the general mass of the 
 consumers, combining as they feel the pitiless 
 consequences of a selfish strike — ^to put its 
 employees down with a merciless penalty. 
 The second conclusion is that this fine talk 
 about a new spirit being engendered when 
 men are no longer employed by a master, but 
 are under merely a State authority, is hide- 
 ously untrue. It is as imtrue in industry, as 
 it is in the civil service of Downing Street. 
 What is needed is the new spirit to begin with, 
 for it is not the tree that creates the root, 
 but the root that, creates the tree. The only 
 method of efficiency, freedom, and industrial 
 peace is to leave the Railway Services to be 
 managed under private control. The State 
 should not venture upon trading, but should 
 be the watchful guardian of the common good, 
 and the just arbiter between contending claims. 
 
 This discussion consummates on the question 
 — ^Is the Nationalisation of the railways an 
 
THE NATIONALISATION OF INDUSTRY 287 
 
 economic proposition ? Here the figures are 
 conclusive. There is no country, with the 
 possible exception of Prussia, which has not 
 incurred a heavy loss when the railways have 
 been nationalised. This country did not 
 realise the cost and the frequent losses incurred, 
 because every deficit fell upon the shareholders. 
 Millions of the capital invested in railways gave 
 no return, and in few cases the dividends rose 
 above two to three and a half per cent. The 
 shareholder saved the State, the commerce 
 of the country, and the individual members 
 of the community. But wherever the railways 
 have been nationalised, not only has the 
 service been less efficient and less elastic, but 
 the rates have increased, and the almost 
 universal deficits have been borne by the tax- 
 paying community. The increased fares have 
 limited the travelling and, therefore, the health 
 and joy of the people. They have enormously 
 increased the price of the necessities of life. 
 But the most condemning fact has been the 
 increased burden in the taxation of the country. 
 The figures available for the years 1910-11 
 give incontestable proof. In Italy, Austria, 
 Hungary, Switzerland, France, Serbia, Belgium, 
 and Canada Nationalisation was tried. In 
 every case the loss was severe and the industry 
 of the country suffered. The Prussian railway 
 
288 THE QUEST OF INDUSTRIAL PEACE 
 
 system, under the drastic military discipline 
 of the Prussian Government, made a small 
 profit. But its employees were fewer and were 
 compelled to work for long and often exhausting 
 hours. Its service was less varied and less 
 efficient, for the British railway service supplies 
 country villages whose need the Prussian 
 Government would not consider. It was 
 among the less rapid of services, and its officials 
 were seldom considerate or courteous. But 
 most convincing of all, the earnings per mile 
 were only £1449 per annum, as against the 
 British earnings of £2074 per mile. Beyond 
 this, in that year the Prussian Government 
 paid in taxes only £750,000, while the British 
 railways paid £5,396,189. Still more condemn- 
 ing is the fact that the Prussian returns show no 
 adequate provision for the renewal of the plant 
 and rolling stock. The conclusion is unavoid- 
 able, and is never questioned by those familiar 
 with the commerce and travel of the covmtry, 
 that both in the interest of industry and of the 
 workers the sooner the bureaucratic control 
 of the Government passes away the better it 
 will be for the railway service. 
 
 IV 
 
 The economic waste, ethical demorahsation, 
 and political strife attendant on the Nationalisa- 
 
THE NATIONALISATION OF INDUSTRY 289 
 
 tion of the public services increase when this 
 method is applied to production. The loss 
 would be incredibly great, and as we have 
 learned, the strife tends to develop into a civil 
 war. When we consider the mining industry, 
 and remember that coal is the chief source of 
 our motor power, we understand this peril. 
 To allow a Guild to make the producer of coal 
 its chief care and concern, whatever happened 
 to the consumer, is a risk not to be dared. But 
 to invest the State with the ownership and 
 control of the mines would make the people 
 dependent on a bureaucratic management 
 whose inefficiency, blundering, and waste have 
 passed into a proverb. The most serious issue 
 is the reckless and selfish demand for wages. 
 This demand swells far beyond that paid to 
 other workers in lesser trades, and farther 
 beyond the power of industry to support. 
 This power to enforce a wilful demand for 
 increased wages is one of the reasons why men 
 cry out for Nationalisation. It is supported 
 not merely by a lightning strike, or by violence 
 in the streets, as at the present time, but by 
 the organised power of the ballot box over 
 fearful and ambitioiis politicians. The poli- 
 tician is always quick to feel and to dread the 
 hot breath of the demagogue. He becomes 
 adroit in winning votes by what are virtually 
 
240 THE QUEST OF INDUSTRIAL PEACE 
 
 bribes. He makes easy promises which must 
 be kept to the public expense. But tinder 
 NationaUsation he would be almost helpless 
 against a threatened assault and, as we have 
 found in education, he would yield to the 
 demand of a caste to the impoverishment of 
 the public well-being. 
 
 What would be the result ? Either that 
 the whole commerce of the country would be 
 throttled, or if the reckless demand were 
 resisted and a stem strife entered upon, in- 
 dustry would dwell in silence for many months 
 and abiding poverty and bitter misery would 
 ensue. The weapon of a strike in the hands 
 of the nationalised industry could be met 
 only by a people wiUing to starve rather than 
 to yield. Already the effect of the past years' 
 yielding is seen. The cost of household and 
 manufacturing coal has checked the progress 
 of industry, and begun to leave the fireside 
 cold. The miners of the United States, less 
 reckless than those of the United Kingdom, 
 are sending coal past our coasts to Denmark, 
 Sweden, and Norway. Many industries at 
 home are on half time. Ship-builders and 
 engineers are cancelling orders. The miners' last 
 demand, made in conjunction with a lessened 
 output, has resulted in a prohibitive price, 
 while the wages have soared to a height which 
 
THE NATIONALISATION OF INDUSTRY 241 
 
 encourages a profligate spending. But the 
 bargain was successfully completed because 
 Nationalisation in fact, though not in name, 
 had been accomplished under the stress of war. 
 Now it is repudiated and the battle is set.^ 
 
 There is no need to deal at length with the 
 case of the Nationalisation of the land, but 
 there are features in the case of agriculture 
 which are peculiar to itself. Every far-seeing 
 and experienced agriculturist knows these 
 peculiar features and understands his business 
 too well to encourage the experiment of 
 Nationalisation. The employees are aware, 
 although willing to listen to men who promise 
 them a larger share, that Jack-in-office methods 
 cannot be applied to a calling so dependent 
 both on a constant and individual watchful- 
 ness and on capricious seasons. All who 
 cultivate the soil recognise insuperable im- 
 pediments to the Nationalisation of their 
 business. Land is not merely a commodity. 
 It is a tool. It is the chief organ of production. 
 It is recognised and agreed that as far as 
 possible the user of the tool should be the 
 owner of it. What is most urgently needed 
 is not a single owner, the State, and not a 
 large owner, the landlord, but a multitude of 
 
 ' Since this was written the Railway Strike has given convinc- 
 ing proof of every position maintained. 
 
 Q 
 
242 THE QUEST OF INDUSTRIAL PEACE 
 
 owners. There is no industry in which sub- 
 division and differentiation of ownership is 
 more required. Jesse Collings called for three 
 acres and a cow, and therein he showed sound 
 common sense. The large estates should be 
 broken up. The broad acres of uncultivated 
 land which are kept for pride and show and 
 luxury should be put under the plough. The 
 pasture lands should be reserved, not for deer, 
 but for sheep. There are millions of acres of 
 moor and wilderness, of heather and bracken, 
 of hillside and glen, which can be reserved 
 for game and become the refreshing and renew- 
 ing haunts of the weary. But above all, the 
 men who till the soil should own it, if its full 
 virtue and value is to be given to man. With 
 millions of small owners there will be given 
 greater stability to the national life. The realm 
 will be filled with a multitude of happy and 
 healthful homes, and the pursuit of the most 
 beneficent occupation known to man would 
 give a yield in men and women who would be 
 a real asset to the wealth of the land. The 
 men who turn their faces to land Nationalisa- 
 tion are upon a broad way at least to destruc- 
 tion. They would make the cultivator of the 
 soil a serf of the State. They would realise 
 Lenin's fiercest dream— a dream too wild even 
 for the enslaved peasants of Russia. 
 
 One other incident of the demand requires 
 
THE NATIONALISATION OF INDUSTRY 243 
 
 notice, but one would hope no more than 
 mention. That is the initial cost of the 
 Nationalisation of the mines and the land. 
 Confiscation has been suggested by some of 
 the more reckless extremists. No moral justi- 
 fication can be pleaded for such violent robbery. 
 Its practical effects make every thoughtful 
 and foreseeing man dismiss it with decisive- 
 ness. Politically it would mean national ruin. 
 The Government which would consent to 
 confiscate any portion of its people's posses- 
 sions, would inctir a penalty whose curse would 
 lie long on the land. Its credit would perish 
 in a night. Its currency would become so 
 many scraps of paper in the market. What is 
 the value of the currency of any nation which 
 has even trifled with the repudiation of its 
 debts ? Its traders would not be trusted. 
 Its impoverished millions would shake the 
 dust of its earth from their feet, and seek their 
 homes under a government which respected 
 common honesty. Even partial confiscation, 
 such as is proposed under a capital levy, would 
 shatter confidence. The trade of the country 
 would languish and the poor be found in the 
 streets of every city crying for bread. The 
 American proverb that, when fools monkey 
 with the machine plain folk get hurt, would be 
 realised as a bitter truth. 
 
 But if the thought of confiscation be 
 
244 THE QUEST OF INDUSTRIAL PEACE 
 
 abandoned and compensation be considered, 
 the price, at twenty-five years' purchase, would 
 be prohibitive, even if mining and railway 
 bonds were issued bearing only a three per 
 cent, interest. The only method is the en- 
 couragement of those who till the soil to buy 
 from those who own but do not cultivate, by 
 a long and wisely-arranged system of transfer, 
 which would be equitable to the landowner 
 and equitable to those who enter upon private 
 possession. Such a method would tend to 
 encourage both industry and thrift on the 
 part of those who work the mines and cultivate 
 the soil, and it would gradually liberate a 
 capital which could be employed in industries 
 and in providing profitable employment for 
 millions of the people. We can rest assured 
 that in spite of some unworthy suggestions 
 on the part of Mr. Snowden, Mr. Hyndman, 
 and Mr. Ramsay Macdonald, the conscience 
 of the coimtry will not sanction a wrong even 
 if it be in some men's judgment a reprisal for 
 another and a condemned system of ownership 
 and control. 
 
 The evils of Nationalisation here indicated 
 are neither theorisings nor prophecies. The 
 recent war has given them so severe a proof 
 as to sober and to silence some once clamant 
 advocates. In a time of war much may be 
 
defensible and unendurable in a time of peace. 
 Conscription, both of capital and labour, to 
 some extent, may then become a necessity. 
 But the stupid inefficiency, the political schem- 
 ing, the scandalous squandermania, the hosts 
 of employees holding soft jobs and treading 
 on each other's heels, the limpet-like clinging 
 to offices with extravagant salaries, the wangling 
 for position and privilege, with the consequent 
 enormous burden of debt and of impoverishing 
 taxation, has opened men's eyes. From the 
 tyranny and waste of a bureaucratic National- 
 isation men are turning to the efficiency, 
 elasticity, economy and freedom of private 
 enterprise. What is needed is not a system 
 with its cast-iron oppression, and its easy 
 opportunities for waste and corruption, but a 
 quickened conscience for righteousness both 
 on the part of employer and employed. The 
 way of righteousness is the only path of 
 peace. 
 
XIII 
 
 THE GATEWAY TO PEACE 
 
 The quest of industrial peace has been in 
 vain. From the earliest visionary Utopia to 
 the latest idealistic and sometimes fantastic 
 theory of social order, the record is dark with 
 disappointment and almost tragic with a costly 
 enlightenment. The experiments which have 
 been actually made have been condemned by 
 the judgment of history. As Carlyle wrote to 
 Spedding, 'Experience of actual fact either 
 teaches fools, or else abolishes them.' The 
 more recent theories set forth by confident 
 advocates have not secured the consent of the 
 conscience or the reason of men. The feverish 
 advocacy of violence by so many of their 
 sponsors is the mark and counsel of despair. 
 Even among nations with a universal franchise, 
 their advocates discern that they cannot con- 
 vince the minds of those who recognise the 
 wrongs of our social order and make protest 
 against them, and cannot enlist the sympathies 
 of those who are eager to welcome any method 
 which is according to justice and truth. Yet 
 
 246 
 
THE GATEWAY TO PEACE 247 
 
 it can be safely set down that whatsoever of 
 justice and truth lies in the heart of these 
 experiments and ideals, will be fulfilled, sooner 
 or later, in some wiser, honester and more 
 reasonable way, and that fulfilment may be 
 wrought out through sacrifices which some 
 are not yet willing to face. 
 
 The foregoing chapters are an attempt to 
 set down the causes of the failure of the past 
 experiments and the rejection of the present 
 theories. Among these causes five stand out 
 as co-operant and pre-eminent. To begin 
 with they have been economically unsound. 
 Economic law is as absolute as any other. 
 Unlike moral law, it keeps time by the clock, 
 because it deals with material things. It is 
 not prophecy but arithmetic which forecasts 
 the hour of a wastrel's poverty. They have 
 also been politically oppressive. Both social 
 and personal freedom have been denied. They 
 have had low or insufficient motives. They 
 have made an appeal to the interests, the greed, 
 or even the sloth, of a class, and have ignored 
 the incentives which meet the whole round of 
 human desire. Still more fatal has been their 
 inaccurate draft of human nature. They have 
 not remembered that man is ' a being of large 
 discourse, looking before and after.' The 
 culminating error has been, either by intention 
 
248 THE QUEST OF INDUSTRIAL PEACE 
 
 or by unthinking blunder, their materialism. 
 They have been based on the conception that 
 in things seen and temporal are to be found 
 the true, full, and all-sufficing satisfactions of 
 life. 
 
 The position maintained here is that there 
 is only one gateway to peace, and that is not 
 economic, or political, but ethical. The 
 solution of aU social problems and the end of 
 all industrial strife are reached by an obedience 
 to the supreme moralities. Righteousness must 
 be the controlling aim, the master of the 
 method, and the test of the motives. As a 
 Hebrew poet has written in immortal words, 
 ' Righteousness and peace have kissed each 
 other ; truth shall spring out of the earth, and 
 righteousness shall look down from heaven. 
 Yea, the Lord shall give it, and our land shall 
 yield her increase.' 
 
 I 
 The supreme teacher of righteousness in our 
 modern civilisation is Jesus Christ. There are 
 many who protest against some of the claims 
 which are made for Him, and these claims are 
 not to be pressed here and now. But there 
 are few voices raised against His moral ideal. 
 By almost universal consent it is agreed that 
 were His teaching and His life rightly under- 
 
THE GATEWAY TO PEACE 249 
 
 stood and unfalteringly followed, there would 
 be, as was promised at His coming, peace on 
 earth to men of goodwill. It is significant that 
 His last bequest was peace. It is no daring 
 claim to make that the gateway of peace is 
 to be found in the understanding of His mind, 
 and the following of His method. 
 
 Christ's ethical ideal of the social order has 
 been set in the term— the kingdom of God. 
 In the Sermon on the Mount He explained it 
 to be righteousness ; or the doing unto others 
 what men would that others should do to 
 them ; or more inwardly, the doing of the will 
 of the Father. One of His disciples, in a fine 
 interpretation, declared this kingdom to be 
 ' righteousness, and peace, and joy in the Holy 
 Ghost.' It was analysed in an appeal to 
 Western minds as a moral condition of being 
 true, honourable, just, pure, expressed in words 
 and deeds of loveliness and of good report. 
 It may be defined broadly as the rule and 
 realm of God in the hearts and lives of men, 
 wrought out and expressed in their agencies, 
 institutions and governments. Christ's im- 
 perative counsel follows, ' Seek ye first the 
 kingdom of God, and all other things shall be 
 added unto you.' When this righteousness is 
 sought and foimd and obeyed, we shall be 
 standing at the gateway of peace, and that 
 
250 THE QUEST OF INDUSTRIAL PEACE 
 
 joy, for which men hunger, will be greeting 
 them on the way. 
 
 This ethical ideal alters all life. The altera- 
 tion it makes can be set down in definite notes. 
 The first of these notes touches the values in 
 life. A man's values are the disclosure of 
 his inner mind. They reveal his supreme 
 desire, that gain or achievement which is the 
 prize of life, his summum honum, or chief 
 good. It is in His values that Christ stands 
 out in contrast and in correction to the minds 
 of our time. On one point He was in agree- 
 ment with many of the nobler thinkers who 
 have been captivated by the prospect of a 
 new social order. Indeed their inspiration 
 is one of His legacies. That is His intense 
 compassion for the disadvantaged, the outcast, 
 the publican and the harlot, the man who is 
 down. Christ set a supreme value on manhood, 
 and had a moving passion for human well- 
 being. But when men laboured for the meat 
 that perisheth, when they sought Him for 
 the sake of the loaves and fishes, when they 
 were eager to make Him a king that they might 
 bring in a social order with an earthly content. 
 He declined at once. For those who believed 
 that a man's life consisted in the abundance 
 of his possessions, who craved ease and idle 
 leisure and sense-gratifying enjoyment, who 
 
THE GATEWAY TO PEACE 251 
 
 contested with others for authority and power 
 and the chief seats of honour. He had nothing 
 but condemnation. He was not overcome by 
 the temptation of ' the kingdoms of this 
 world.' He did not crave a share of the 
 purple and fine linen and sumptuous fare of 
 the rich. His passion was for righteousness. 
 For that He lived and for that He died. ' Let 
 this mind be in you which was also in Christ 
 Jesus, who being in the form of God thought 
 it not a prize to be equal with God, but made 
 himself of no reputation and took upon him 
 the form of a servant, and was made in the 
 likeness of men.' 
 
 Because of Christ's values He had only a 
 spiritual evaluation of the meaning and purpose 
 and work of life. He did not concern Himself 
 about a new environment, but about new 
 inward impulses. He did not talk about 
 wages ; He talked about hearts. He strove 
 to make men discontented with themselves 
 and their moral condition, but to be content 
 with whatsoever state they were in. To Christ 
 the world was not a stage where a man may 
 play a high part before men's eyes ; not a feast 
 at which he may sate himself with the delights 
 of appetite ; not a garden in whose paths he 
 may walk and gather fruits for which he has 
 not laboured. The world is a school where a 
 
252 THE QUEST OF INDUSTRIAL PEACE 
 
 man may learn righteousness ; a battlefield 
 whereon he must fight the good fight of faith ; 
 a wilderness through which he is a pilgrim to a 
 spiritual destiny. It is not too much to say 
 that did every man, whether richer or poorer, 
 master or servant, hold Christ's estimate of 
 values the gateway of industrial peace would 
 not be hard to find. 
 
 This note of values is in accord with, and an 
 interpretation of, the place of wealth. Christ 
 did not condemn wealth, but He placed no high 
 value upon it. ' The Son of man hath not 
 where to lay his head.' He was content to 
 be homeless, and to be dependent on the gifts 
 of others, without a grudging glance or an 
 envious throb. He taught that wealth was a 
 peril, and a peril greater than poverty. ' How 
 hardly shall they that have riches enter into 
 the kingdom of God ! ' On the rich man who 
 did not see the beggar at his gate ; on that 
 successful worldUng who proposed to pull 
 down his bams and build greater; on that 
 young ruler who turned back from the narrow 
 way because of his possessions. He passed a 
 withering judgment. He had none of the 
 modern bitterness against the rich. But His 
 ruling thought about wealth is that its only 
 value lies in its stewardship. He taught that no 
 
THE GATEWAY TO PEACE 253 
 
 man should count his wealth his own — ^he 
 was simply a steward who was dealing with the 
 possessions which belonged to Another. A 
 great and high life could be lived without it, 
 and, therefore, He did not set that value upon 
 wealth, and upon what wealth can give and 
 attain and achieve, which is one of the ob- 
 sessions of our modern mind. It should go 
 without saying that, were wealth regarded as a 
 stewardship, and were its possessions realised 
 to be so perilous on the one hand and so im- 
 potent on the other, there would not be such 
 a hunger for it or such a corroding envy of 
 those who own it, and spend it so often to their 
 own undoing. 
 
 II 
 A second note to be drawn from Christ's 
 ethical ideal is His attitude toward systems 
 and institutions and organisations. Christ did 
 not advocate the adoption of any articulated 
 social order. The Utopian communists, from 
 Plato to the last founder of a brand-new South 
 American settlement, the fiercer Marxian 
 socialist with his lust for revolution, the 
 syndicalists. Guild socialists, and nationalisers 
 aU put their faith in new systems. Some 
 organised environment, they seem to believe, 
 will re-order human life, and lead or compel 
 
254 THE QUEST OF INDUSTRIAL PEACE 
 
 men into a stable equilibrium, if not to a 
 fellowship and brotherhood. But Christ did 
 not propose schemes of economic, or social, or 
 political order. He made no attempt to ex- 
 press in a constitution, and work out into an 
 organisation, any method of carrying on in- 
 dustry. He did not teach that one social 
 order should be stereotyped, and imposed on 
 east and west, on north and south. He left 
 such a detail, as He left many other details, 
 to be one of the other things, ' added imto 
 you ' when the righteousness of the kingdom 
 had been accepted, and obeyed. Let men be 
 willing to do to others as they desire others 
 to do to them. Let them be true and 
 honourable, just and pure. Let them look 
 not only on their own things, but also on the 
 things of others. Then systems, and methods, 
 and social orders would aU grow in accordance 
 with the inner spirit and outer methods of 
 righteous men. All systems depend largely 
 on racial characteristics, climatic conditions, 
 geographical distribution and ineradicable 
 tastes. But if men are just and pure they 
 will be co-operative and sympathetic. If they 
 submit themselves to the sovereignty of a 
 righteousness whose highest grace is love, all 
 petty ambitions, all self-interest, all base in- 
 dulgence, all oppression of man by man will 
 
THE GATEWAY TO PEACE 255 
 
 cease, even though it be at the high price of 
 sacrifices such as only righteousness and love 
 are willing to pay. 
 
 For that reason it can be said that Christ 
 had no concern with any system of the posses- 
 sion, or any method of the control, of wealth. 
 Whether men should adopt Capitalism, or 
 Collectivism, or work out some compromise 
 between them, had no interest to Him. His 
 teaching distinctly denies that the wrongs 
 from which men suffer are bred by systems 
 or by methods. The wrong method and the 
 wrong system are bred by the evil men. From 
 His teaching it is quite evident that it was of 
 no interest to Him as to whether a man should 
 reap his own com, or get some other one to 
 use the sickle and receive a wage for his 
 service. In His day CapitaUsm was the un- 
 questioned method, and it may be said that 
 He was compelled to use the accepted facts 
 of the time without thereby approving of 
 Capitahsm. But against such an inference it 
 must be remembered, that there is no hint 
 of condemnation of Capitalism, and that His 
 counsels assume not only the righteousness 
 of CapitaUsm, but its value as a means of moral 
 discipline. In such parables as the labourers 
 in the vineyard, the treasure hid in a field, 
 the pearl of great price, the talents, the shepherd 
 
256 THE QUEST OF INDUSTRIAL PEACE 
 
 and the sheep, He emphasises the fact that the 
 possession of private property and the use of 
 wealth as capital are just and inevitable 
 conditions of industry, fidelity, and loyalty 
 to high ideals. In the parable of the labourers 
 in the vineyard He draws a pen portrait of a 
 capitalist, and it is most evident that were all 
 capitalists as just, as wise, as solicitous for 
 the well-being of those who serve them, we 
 would be already passing through the gateway 
 of industrial peace. 
 
 Ill 
 A third and most distinctive note in the 
 application of Christ's ethical ideal deals with 
 the method of the realisation of a better social 
 order. All the wiser advocates of any system 
 of Collectivism realise that more is needed than 
 a skilfully devised plan. They have all been 
 on the margin, at least, of demanding a new 
 spirit and a new character. But they have 
 differed as to the creation of that spirit and as 
 to its source. All the wiser thinkers under- 
 stand that it is vain to draw plans for a temple 
 when there are no worshippers to enter its 
 walls, and foolish to imagine a new social 
 order without men changed in heart to become 
 its citizens. But Christ stands on the other 
 side from those who are prosecuting the 
 
THE GATEWAY TO PEACE 257 
 
 socialistic movement. Some of these postulate 
 the inherent goodness of human nature. Others 
 believe that a class war would generate a new 
 spirit. Others maintain that a high ideal 
 would react upon the mind and will of men. 
 Others believe that an environment of liberty, 
 or ease, or self-willed independence would, 
 as by a miracle, change the inner heart of 
 humanity. Jesus set all these shallow 
 sophistries aside. Not only by His stem de- 
 nunciations, not only by His protests, not only 
 by His demands, but by His express statement 
 He taught the truth which aU men know, by 
 the witness of their own actions, to be the 
 truth. ' Out of the heart proceed evil thoughts, 
 murders, adidteries, fornications, thefts, false 
 witness, blasphemies ; these are the things 
 which defile a man.' Because they defile the 
 man they corrupt his life. They degrade his 
 ideals. They make a mock of all system and 
 method. 
 
 The most convincing proof of this simple 
 and indubitable truth, is to be found in the 
 recantation of Robert Owen in an address at 
 New Harmony, his American commune, de- 
 livered in the autumn of 1837. ' I have tried 
 Socialism, tried it patiently and thoroughly, 
 and it has failed ; failed utterly and miserably 
 as the basis to nm a colony or community upon. 
 
258 THE QUEST OF INDUSTRIAL PEACE 
 
 It has failed because it omitted to take into 
 account the differences between the characters 
 and constitutions of men, failed because it 
 omits to supply an incentive for developing 
 the best out of an individual. We have had 
 a healthy climate, a fruitful land, no rent 
 charges, no interest on capital, no rates, no 
 taxes, unlimited resources, our own laws to 
 make, and only adults to provide for, and yet 
 it has failed. I have been grievously educated 
 in the human being. There are some men 
 who will receive everything and yield nothing. 
 All men receive greedily and yield grudgingly.' 
 {New Harmony Gazette, vol. iii.) There was 
 the high ideal, the inspiring endeavour, the 
 ideal conditions of life, the most appealing 
 environment. Yet it failed, and Owen was 
 ' grievously educated in the human being.' 
 He found what every other has found, that the 
 way into a better social order is by a change of 
 heart. 
 
 Christ said that this change of heart and this 
 newness of spirit must come ' from above.' 
 With such a declaration, if interpreted liberally, 
 all men will agree. Even Sorel is standing 
 before that truth. Only spirit can quicken 
 spirit. Every man who has been moved to a 
 passion for higher things has himself been 
 enkindled by some other, perhaps the mother 
 
THE GATEWAY TO PEACE 269 
 
 who bore him, or some simple man who 
 taught him righteousness. Never has it been 
 by a prospect of gain, or a new social order, 
 or a high ideal. It has always been by some 
 personality, whose spirit touched the heart 
 and will of a man predestined to leadership and 
 action. It would not be just to Christ to leave 
 this brief statement of His first demand 
 without remembering that for Him the state- 
 ment ' from above ' meant the power of the 
 Spirit of Gk)d. That determines not only the 
 method by which social betterment can be 
 introduced, but the dynamic by which it can 
 be perfected. Only the man bom again can 
 ' see the kingdom of God.' Only the man 
 bom of the spirit, and wholly devoted to its 
 righteousness, can enter into it. Only the man 
 who accepts its laws can receive the potent 
 djmamic. Social service, the service of man, 
 the enthusiasm of humanity, name it as you 
 wiU, has its own value. But that is not the 
 distinctively Christian motive. The most 
 noted Christian servant of man set the supreme 
 Christian motive in a single sentence, ' For 
 we preach, not ourselves, but Christ Jesus 
 as Lord: and ourselves, your servants, jor 
 Jesus' sakeJ' When men accept His ideal of 
 righteousness and enter into His mind, estimate 
 life with His values, and keep His open mind 
 
260 THE QUEST OF INDUSTRIAL PEACE 
 
 as to systems, with His inexorable demand 
 for a change of heart, they will be, at the 
 least, not far from the gateway of industrial 
 peace. 
 
 IV 
 
 In any brief exposition of the mind and 
 method of Christ there are two difficulties in 
 its application to modem life. One is that 
 Christ's teaching, most naturally, was in the 
 Eastern or Oriental fashion, not by thesis and 
 argument as the Western mind appreciates, 
 but by figure and symbol and aphorism. The 
 second difficiJty is that, as we have seen, 
 Jesus assumed and accepted the method of 
 Capitalism, and, to a remarkable extent. His 
 counsels imply the possession and use of 
 personal property. It is for that reason, 
 chiefly, that modern Socialism has not only 
 thrown over the Christ of the Gospels, but 
 sometimes blasphemes Him. But in the 
 Epistles these two difficulties disappear. The 
 Church of Christ made its way into the West, 
 and the Epistles, with the Book of the Acts, 
 were written almost entirely by men of Western 
 birth and training. Beyond that fact the 
 members of the Church were drawn largely 
 from the ranks of the poor— from the labouriag 
 classes. Therefore we turn to inquire into the 
 
THE GATEWAY TO PEACE 261 
 
 teaching of the Acts and Epistles, and to see 
 how these Western writers, thinking of poor 
 men, sometimes slaves, coimselled labour, and, 
 in their counsels, conveyed the mind and 
 method of Christ. As we shall see, they faced 
 the same problems as we face to-day, and 
 their quest was also the quest of industrial 
 peace. 
 
 It one were to collate all their teaching upon 
 the relationships of capital, and labour, and 
 the social order, most men would be amazed 
 at its weight and directness. Warnings and 
 admonitions aboimd. Injunctions to masters 
 and to servants are distinctive. The use and 
 misuse of wealth and the sins of the rich and 
 the poor are all noted. But one sentence 
 gives a most detailed message, and this 
 sentence, though addressed to labour, had 
 its application to all men. It is a golden 
 sentence packed with appeal. ' Let him that 
 stole steal no more ; but rather let him labour, 
 working with his hands the thing which is 
 good, that he may have to distribute to him 
 that needeth.' Examine the five counsels in 
 that appeal. 
 
 The first is the counsel to moral integrity. 
 ' Let him that stole steal no more.' Moral 
 integrity, righteousness, as Christ taught, is 
 the basis of any stable society. You cannot 
 
262 THE QUEST OF INDUSTRIAL PEACE 
 
 build an Al empire with C3 men physically, 
 and you cannot bxiild an Al social and 
 industrial order with C3 men morally. The 
 criminal, the man who is wilfully dishonest, 
 who gives short measure, uses unjust weights, 
 mocks at the moral commandments, cannot 
 be a stone in the walls of an enduring State. 
 No skilfully planned system or shrewd regtda- 
 tions which control hours and wages and 
 reward, not even ideal conditions, are of any 
 avail, if those who are called to live iinder 
 them, or by them, are thieves. It is difficult 
 to write with patience of the profiteer whose 
 selfish use of his opportunities was a scandalous 
 sin against society and against God. Every 
 penny he extracted shall yet be" taken from 
 him. But we must pass an equal con- 
 demnation on the shirker and slacker, on 
 the man who did not give a mil day's honest 
 work for a full day's wage, who adopted the 
 ca' canny policy under a miserable delusion 
 as to its economic results. We need waste 
 no time with these and similar offenders. 
 They are all thieves, and the writer in this 
 passage is repeating the mind of Christ when 
 he cries, ' Steal no more.' Moral integrity, 
 that is the changed heart and right spirit, is 
 the first necessity. 
 
 The second is the counsel to diligence in 
 
THE GATEWAY TO PEACE 268 
 
 labour. ' Rather let him labour.' The dignity 
 of labour was at one time an assured truth. 
 The praises of the village blacksmith and of 
 the hardy fisherman were recited by the chil- 
 dren, and Carlyle's tribute to 'the toilwom 
 craftsman, that with earth-made implement, 
 laboriously conquers the earth and makes her 
 man's ' was read with a thrill of admiration. 
 But to-day it does not seem to be so honourable 
 to earn one's bread in the sweat of one's face. 
 The envied are ' the idle rich,' the most immoral 
 and most pitiable of creatures, mere cumberers 
 of the ground. The idle poor are not higher 
 in the moral scale. Yet the cry is heard for 
 few hours of work, and many hours of idle 
 leisure. Proposals are made whereby men 
 shall fulfil their calling and discharge their 
 obligation to the community in four days a 
 week, and three hours a day, that they may 
 spend the rest in an ease which is likely to be 
 after the fashion of the animal. There are 
 some confident teachers who would not call 
 on men to labour at all, unless that happened 
 to be their mind, but would give them a dole, 
 and make them the idle paupers of the State. 
 The economic madness of any such method 
 wovdd quickly appear. The law that if a man 
 will not work he shall not eat, and the truth 
 that a man shall not eat what his neighbour 
 
264 THE QUEST OF INDUSTRIAL PEACE 
 
 has earned, are simply honesty in action. By 
 the lack of steadfast diligence in labour it is 
 always the poor, the disadvantaged, the 
 weaker who suffer. The moral issues are even 
 more disastrous. ' Satan finds some mischief 
 still for idle hands to do,' enshrines a neglected 
 truth. ' Idleness is chief mistress of vices all.' 
 To fill one's day with labour is to find health 
 of body, strength of mind, cheerfulness of 
 spirit, and to be ennobled by the discipline of 
 the soul. No man need be called upon, or 
 shall be called upon, to a limiting and burden- 
 ing toil, but the path of noble living demands a 
 steadfast diligence in laboiir. 
 
 The third is the counsel of production. 
 ' Working with his hands the thing that is 
 good.' A man may be busy enough. He 
 may allow his vocation to engross his energies 
 and dominate his mind and heart, so that his 
 higher aptitudes wither and his tenderer affec- 
 tions die. Or, he may busy himself in an 
 occupation which is evil. A good man will 
 not keep his goodness if he works at a bad 
 trade. In Paul's day, as in our own, there are 
 some industries which are base in themselves. 
 The bookmaker, the betting tout, the keepers 
 of houses and of clubs which shelter vice are 
 making gain out of the evil passions of men. 
 Others are busy labouring at work which is 
 
THE GATEWAY TO PEACE 265 
 
 base in its purpose. When men print indecent 
 books, or publish papers which live by reporting 
 the scandals of society, or when they produce 
 goods which are not honest but are faked so as 
 to deceive the unwary, or when they minister 
 to the tastes and habits of an immoral class, 
 they are not working at that which is good. 
 One flagrant instance is to be found in the trade 
 in intoxicating liquors. Its prohibition or 
 restriction may seem to some to be an in- 
 trusion on liberty, and a limitation of the good 
 cheer of life. But its sadly evident issues, as 
 every man finds his conscience condemning, 
 prove the liquor traffic to be a thing that is not 
 good. Whatever ministers to the pure 
 necessities of body and mind, of flesh and 
 spirit, whatever makes it easier for the weaker 
 to stand in truth, and the poorer to be brought 
 into a more gracious realm of life, whatever 
 will lift men's hearts above that pitiful 
 materialism, which is the moral drug of our 
 time— these are the things which are good. 
 
 The fourth is the counsel of private property. 
 ' That he may have.' Here there is the 
 vindication of personal property without quali- 
 fication or stint. And here, with equal 
 simplicity, there is set down the possession 
 of property as a motive to labour. This 
 motive has the consent of both the Hebrew 
 
266 THE QUEST OF INDUSTRIAL PEACE 
 
 and the Christian scriptures. A Hebrew dared 
 not and could not aUenate his inheritance. In 
 the New Testament a mistaken and short- 
 Hved attempt to have all things in common 
 broke down. It was never accepted by the 
 community, and it is never supported by the 
 teaching either of Jesus or His disciples. 
 Peter's reproach to Ananias gives the theory 
 an express denial. ' Whiles it remained was 
 it not thine own ? And after it was sold was it 
 not in thine own power ? ' His words are an 
 echo of his Master's who rebuked the envy of 
 the labourers in the vineyard and their com- 
 plaint against the capitalist, by the question, 
 ' Is it not lawful for me to do what I will with 
 mine own ? ' Private property, with the right 
 to dispose of it as one will, is a true incentive, 
 for it provides for the use of a man's talents, 
 the exercise of his powers, and the moral 
 discipline of his will. A strong, free, reliant 
 character is not possible apart from the posses- 
 sion of private property. 
 
 The fifth counsel is the unselfish use of 
 possessions. ' To distribute to him that 
 needeth.' Here we reach the deepest source 
 of the discontent and strife of our time. No 
 one can condemn too strongly the basely 
 selfish use of the possessions of hfe. We all 
 mark the extravagant and wasteful eating and 
 
THE GATEWAY TO PEACE 267 
 
 drinking, the regardless life of frivolous and 
 flippant pleasures, the rich and gaudy apparel 
 of the richer classes, sometimes, in the case of 
 their women, as shameless as it is ridiculous. 
 To turn the pages of a society paper, and to 
 mark the entirely self-centred and frivolous 
 life which so many lead, is to realise how 
 sternly this apostolic rebuke falls upon them. 
 We need not wonder that certain types of 
 minds are filled with envy, and that hate begins 
 to poison their hearts, and the cry for equality 
 is heard upon their lips. It must not be 
 forgotten that these same transgressions are 
 evident among wage-earners, and that all 
 classes fail in this distribution to him that 
 needeth. If only men used their possessions 
 unselfishly, not simply by way of charity, but 
 with a nobler interpretation of human need, 
 for the interest and well-being of their fellow 
 men and their country and for the uplift of 
 universal humanity, much of the clamour 
 against the possession of private property 
 would be heard no more. 
 
 There is one instance in which the writer is 
 convinced a signal and ennobling gain might 
 be made. Pi'oposals have been mooted to 
 confiscate a large portion of our impoverishing 
 national debt. The softer-sounding method 
 of a capital levy has its advocates. Both of 
 
268 THE QUEST OF INDUSTRIAL PEACE 
 
 these are dishonest and dishonourable. If 
 adopted they would shake our national credit 
 so that men would no longer trust the State 
 or trust each other, and industry would 
 wither at its root, and destitution stalk through 
 the land. But this Christian counsel commends 
 a better way. It would be noble and ennobling, 
 it would be wise and the teaching of wisdom, 
 it would be economically sound and politically 
 prudent, were every holder of the War Loan, 
 from the depositor in the Savings Bank to the 
 richest investor to make some surrender of a 
 portion of what he has invested in the National 
 Debt, and thereby reduce it and its exacting 
 burden of interest by a notable amount. That 
 would be an application of the fine saying, ' from 
 each according to his abihty— to each according 
 to his need.' That is not a complete or a suffi- 
 cient maxim for distribution. ' To each accord- 
 ing to his desert' is the primary and comple- 
 mental truth. But there are occasions when 
 there ought to be shining examples of self- 
 sacrifice, and this would be after the example 
 of Christ. The whole world would be thrilled 
 and quickened to faith and hope by such a 
 distribution ' to him that needeth.' 
 
 This gateway to peace may seem too strait. 
 There are minds which may mock at this claim 
 for righteousness as the source of peace. 
 
THE GATEWAY TO PEACE 269 
 
 Others may consider it only as a dream. But 
 there is a time to dream, for the vision comes 
 at the hour of the dawn of a better day. 
 
 ' Dreamer of dreams I We take the tsMnt with gladness. 
 Knowing that God, beyond the years we see, 
 Has wrought the dreeim that comits with you for madness 
 Into the texture of the world to be.' 
 
 This supreme truth is no idle dream, for it has 
 been ' wrought into the texture of the world ' 
 that has been. Even in those hapless experi- 
 ments and impossible theories which we h^ve 
 considered, the one appealing note has been 
 the endeavour after righteousness, as that was 
 conceived by their advocates. The renewal 
 of a distraught and disordered society has 
 always been attained through a return to the 
 gateway of justice and truth. Mr. F. B. 
 Lecky, in his History of Europe in the 
 Eighteenth Century, has given a vivid descrip- 
 tion of the condition during its closing years.^ 
 ' Millions of fierce and ardent natures were in- 
 toxicated by dreams of an impossible equality 
 and of a complete social and political re- 
 organisation. A tone of thought and feeling 
 was introduced into European life which could 
 lead only to anarchy and at length to des- 
 potism, and was fatal to that measured and 
 ordered freedom which can alone endure. Its 
 
 > Vol. iii. pp. 145-46. 
 
270 THE QUEST OF INDUSTRIAL PEACE 
 
 chief characteristics were a hatred of all con- 
 stituted authority, a habit of regarding re- 
 bellion as the normal, as well as the noblest 
 form of political self-sacrifice, a disdain for all 
 compromise, a contempt for tradition, a desire 
 to level all ranks and subvert all establish- 
 ments, a determination to seek progress, not 
 by the slow and cautious amelioration of 
 existing institutions, but by sudden, violent, 
 and revolutionary change. Religion, property, 
 civil authority and domestic life were all 
 assailed, and doctrines incompatible with the 
 very existence of government were embraced 
 with the fervour of a religion.' Bitter ex- 
 perience of the inevitable issues educated the 
 thinking mind of those who, as in the case of 
 Wordsworth, had been carried away by un- 
 founded hopes. But it was the revival of 
 evangelical religion which brought men of all 
 ranks and classes back to the gateway of 
 righteousness as taught by Christ and saved the 
 community. The enthusiasm for the religious 
 life extirpated the base passions of greed and 
 hate and the lust for power. There is no other 
 way. ' The work of righteousness shall be 
 peace ; and the effect of righteousness quietness 
 and confidence for ever.' 
 
XIV 
 AN INDUSTRIAL COVENANT 
 
 Peace on earth to men of goodwill — ^and to 
 no other. A man of honest mind may have 
 his own deep reaction against the evils which 
 sadden and corrupt men's lives, and is entitled 
 to make his urgent protest against all wrong. 
 But until he has purged himself of a selfish 
 hostility to his fellow men he cannot pass 
 through the gateway of peace. It is well to 
 believe that such goodwill, in spite of the bias 
 of human nature, is possible to every man. 
 The most callous profit-monger and the most 
 violent demagogue inciting his fellows to 
 violence, may be purged of bitter and degrad- 
 ing passion, and be brought to look upon each 
 other with a compassion, which may pass into 
 a desire. It may be ventured that the course 
 of the present most troubling industrial history 
 will correct, and even extirpate, much of the 
 prevalent selfishness, and bring men to a state 
 of mind in which they shall be intent on doing 
 justly and loving mercy in the social and 
 industrial order. 
 
 27X 
 
272 THE QUEST OF INDUSTRIAL PEACE 
 
 I 
 
 Every observer of the trend of thought and 
 desire can perceive that this ideal is before all 
 men's minds. What is sought is an industrial 
 covenant. This word covenant has had so 
 tragic and ill-omened a history that it is used 
 with hesitation. Yet the conception holds the 
 solvent of strife. The covenants of the past 
 have failed because they have sought the 
 selfish triumph of a cause or a dogma ; or 
 because they have engrossed limiting and 
 chafing details among their articles ; or because 
 they have been imposed, as if absolute and 
 final, by force. The covenant which shall 
 attempt to achieve impartial justice, broad 
 freedom, and wise toleration, will commend 
 itself to the conscience of humanity, and 
 translate righteousness into the terms of 
 peace. 
 
 The signs of our times reveal a state of the 
 public mind which is favourable to the adoption 
 of such a covenant. There is the constant 
 claim on the part of all who are engaged in 
 industry, and are eager in the strife, that they 
 are impelled by unselfish motives. The 
 capitalist declares that he is moved by his 
 sense of the economic soundness and moral 
 advantage of his method. The labour orator 
 
AN INDUSTRIAL COVENANT 273 
 
 denies the charge that he is seeking merely 
 material betterment, and maintains that his 
 aim is a nobler life for all. So completely has 
 the ethic of Christ leavened all men's minds 
 that it can be said of every one, whatever 
 side he may take, that he would resent the 
 charge of seeking his own profit or securing 
 his own advantage, or even endeavouring 
 to promote the well-being of some at the 
 unjust cost and unrighteous deprivation of 
 another. 
 
 Another hopeful sign is the universal con- 
 viction that this industrial strife, with its 
 impoverishing losses, its entail of suffering 
 and its deepened bitterness of revengeful 
 feeling, must pass. Every strike has a by- 
 product of injury, sometimes its only product, 
 both to the strikers and the struck. The wail 
 of its helpless victims can be heard by all who 
 have ears to hear. It is being realised that 
 hitherto the issue of every strike has been at 
 best an armistice, or at worst a truce, between 
 more vengeful and more hostile men. The 
 modem appeal for employers and employees 
 ' to get together ' and the persistent advocacy 
 of all manner of compromise, and every possible 
 mode of reconciliation, are further proofs that 
 men are sick to death of the present way of 
 dealing between those who represent capital 
 
274 THE QUEST OF INDUSTRIAL PEACE 
 
 and those who represent labour, and are eager 
 for a new basis of agreement. 
 
 There is one third symptom which has more 
 promise than any other. That is the con- 
 sciousness that in this strife the true and 
 ultimate aim of industry has been obscured, if 
 not ignored. The air is filled with the clamour 
 of the fierce debate between capital and labour, 
 and the still keener conflict between Capitalism 
 and Collectivism. One would sometimes think 
 that the chief good — ^the real aim — ^is the 
 conserving of the power and profit of the 
 capitalist on the one hand, and the ease, 
 comfort, and independence of the worker on the 
 other. At times, from the discussions, it 
 could be believed, that the end to be reached 
 is to prove the economic soundness of the 
 capitalistic method, or that the real reason 
 for industry is to give pleasant work and pay 
 abundant wages, to those who are willing to 
 handle the tools. But the ultimate aim, we 
 are being taught, is the general good of the 
 community, the well-being of the people, the 
 supply of the wants of the consumer. That 
 should include the betterment of all the 
 citizens of the realm, the advancement of the 
 civilisation of our time, and the provision of a 
 free and fair life for all. It should include the 
 creation of opportunities, in which every one 
 
AN INDUSTRIAL COVENANT 275 
 
 may freely advance in knowledge, in skill, 
 and in independence, but not in any truculent 
 and small-minded demand to be completely 
 independent of his neighbour, or indifferent 
 to his obligations to the community and the 
 State. Did men always keep in mind the 
 ultimate good of the community, they would 
 not overcharge and fleece the people in a time 
 of distress, nor would they demand a wage 
 which requires a State subsidy, and imperils 
 the whole manufacturing industry of the 
 country, nor would they callously insist that 
 the coal mines of the country should be ruined 
 by flooding. These are base actions, and are 
 lapses from the true end and aim of industry — 
 this well-being of the community — and they 
 are breaches of the unquestioned Christian 
 ethic of our time. 
 
 II 
 
 Every covenant is based on certain pos- 
 tulates. These postulates, as here set down, 
 have been approved, as the writer thinks, 
 by history, and by the discussions referred to 
 already. Only a brief note of supporting 
 proof is added to each of them here. 
 
 The first postulate is that this must be a 
 covenant only for wage-earning industry. It 
 must not touch those spheres of life which lie 
 
276 THE QUEST OF INDUSTRIAL PEACE 
 
 outside the production, distribution, and ex- 
 change of wealth. It must not presume to 
 enter upon political questions, and use its power 
 to effect changes in the constitution of the 
 country. It must not attempt to bring the 
 art, the science, the literature, all of them so 
 dependent upon individual initiative and 
 personal ability, within its scope. Much more 
 decisively it must not dare to touch the 
 religious life of the members of the common- 
 wealth. These spheres of human interest and 
 moral passion are so complex, so delicate, so 
 much differentiated, so inwrought with the 
 life of the spirit of man, that no covenant set 
 down in articles should ever have attempted, 
 or dare now attempt, to embrace them. The 
 Scottish Covenanters failed because they 
 sought to embrace the whole round of life, 
 to dictate not only to the mind and the con- 
 science, but to the manners and habits of the 
 people. Only in the sphere of industry can 
 this covenant be concluded. 
 
 A second postulate is that the method of 
 Capitalism must be accepted, however it may 
 require to be adapted to new ideals and 
 changing circumstances. It may be that 
 Nationalisation can be applied to a few de- 
 partments of labour. But these must be 
 services required by the whole commimity, 
 
AN INDUSTRIAL COVENANT 277 
 
 and must never be income-producing industries. 
 It may also be accepted, with more certainty, 
 that municipalisation will be adopted for some 
 of the lesser requirements of a limited area. 
 But it must be noted that, in so far as these 
 have succeeded, they have been based upon a 
 capitalistic system, and have, therefore, been 
 able to borrow capital and pay dividends to 
 the citizens, who have loaned the results of 
 their thrift and foresight. Broadly speaking. 
 Capitalism must persist. It has proved itself 
 the only practicable method by its efficiency, 
 its economic soundness, its stimulation of 
 initiative, enterprise, inventiveness and re- 
 source. It has shown its power to promote 
 and conserve the moral qualities of freedom, 
 responsibility, and frugaUty. It has given, 
 and it alone can give, the due incentives re- 
 quired by humanity. To entrust industry to 
 the State is to adopt a method of impoverish- 
 ing wastefulness, to enthrone an incompetent, 
 supercilious, and oppressive bureaucracy, and 
 to throw the burdens of mismanagement and 
 scandalous carelessness upon the shoulders of 
 the ratepayers. The early history of Socialism 
 has made all partial Collectivism ridiculous. 
 The later history of State Collectivism, whether 
 by organised departments, or by a fully de- 
 veloped Soviet has checked all but ' the wild 
 
278 THE QUEST OF INDUSTRIAL PEACE 
 
 men ' in their advocacy of Collectivism. 
 Moscow has taught them also to speak with 
 less scornful and more guarded arguments. 
 Capitalism fulfils the demand that, to use a 
 popular word, it must ' function ' in industry. 
 It does fulfil a function, not in the narrow sense 
 of a man with a tool in his hand, but in the 
 truer and broader sense of giving a service to 
 industry. That service is not simply the 
 watchful and skilful oversight of the master 
 of industry who has risked his capital in the 
 business, but the service of those who have 
 loaned their private possessions for others to 
 use. The man who hires a conveyance, or 
 engages a cycle, or a boat at a riverside resort, 
 is not such a fool as to rail against their owners 
 when they ask a return for the use, and for the 
 wear and tear, of their property. It is only 
 when he thinks of the man who has lent ' in 
 cash ' the amount of wealth which is svmk in 
 the motor, or the cycle, or the boat, and 
 demands a dividend, that he grows resentful 
 and abusive. It is not easy to see why so 
 many men, themselves so often living on 
 dividends, rail against Capitalism. The 
 capitalist may require to be restrained, and 
 that is fast being carried out, but Capitalism 
 must persist. 
 A third postulate is that capital and labour 
 
AN INDUSTRIAL COVENANT 279 
 
 must adopt a relationship of co-operation. 
 Any review of the past will discern that that 
 has been the one dominant feature of all 
 successful industry. The Co-operative Move- 
 ment bases its whole endeavour on that single 
 foundation stone. It has been the refusal to 
 co-operate which has ruined every commune, 
 and blocks the way of Marxian Socialism, and 
 of every other which seeks to place a class in 
 the seat of power, or to introduce a dominating 
 guild. It must be remembered that, with 
 Capitalism, competition shall remain. But 
 it is an idle and groundless idea that com- 
 petition can ever be eliminated as a fact and 
 force in human life. It is indispensable in 
 industry. Some men may desire the existence 
 of a Lotus-eater's paradise, where there is 
 no spur to energy, no quickened emotion, no 
 urgent call upon a man's strength of will and 
 power of faculty. That means the degradation 
 of manhood, the paralysis of the nobler moral 
 impulses, the ceasing of the ascent of man in 
 his upward calling, even the corruption and 
 ruin of our civilisation.^ But when capital 
 and labour become co-operant, the evils of 
 competition will pass away. It will remain ' a 
 gentle prick to progress ' between nation and 
 
 ' A frank and convincing statement of the value of strenuous 
 irork is to be found in The American Bra, by H. H. Powers. 
 
280 THE QUEST OF INDUSTRIAL PEACE 
 
 nation, industry and industry, factory and 
 factory, skill and skill, finish and finish. The 
 efforts after high repute, excellence of quaUty, 
 increase of usefulness, and the achievement of 
 loveliness shall continue. These shall ever be 
 the most worthy objects of competition. Along 
 with these there wiU be, inevitably, the accom- 
 paniment of a further reward for those who 
 prove the more competent among their fellows, 
 who put forth more energy in their work, and 
 exhibit their power to excel. But when labour 
 and capital co-operate, the whole conduct 
 of the methods of industry, with aU the de- 
 batable questions of hours and wages, of work 
 and reward, including the regulation of com- 
 petition, must come imder a common review, 
 where every interest wiU be represented, and 
 every failure to do justice be exposed and 
 condemned. 
 
 The fourth postulate is that reward must 
 bear a proportion not only to the toil and 
 strain, but to the value, of the function fulfilled. 
 This proportion can never be set down in 
 arithmetical terms. There are rewards that 
 men will always desire which are not material, 
 and cannot be estimated or paid for in current 
 coin. Yet there must be actual payment, 
 with a due proportion to service, so as to be 
 both the recognition and the reward of this 
 
AN INDUSTRIAL COVENANT 281 
 
 higher value. The man who gains five talents 
 more must be rewarded, as the man who has 
 wasted his talent should not be. Equality 
 is not always justice. ' From each according 
 to his ability ' is one part, but only one part, 
 of the law. ' To each according to his desert ' 
 is an equally cogent line. It would outrage 
 justice if a man who had ability but would not 
 exercise it, should receive an equality of reward 
 with a man of diligence. Or if a man, having 
 had ability, should waste his power of work by 
 profligate living, and yet should still demand 
 an equal reward with a sober and industrious 
 fellow-worker, equity would be mocked. The 
 third line, so often quoted, ' To every man 
 according to his need,' is a law, not of industry, 
 but of mercy and charity, and there should 
 be room in the conduct of industry for both. 
 But nothing can be more paralysing to enter- 
 prise, stifling to ennobling ambitions, and 
 enervating to the high resolves of brave and 
 unselfish men than to see a wilful slacker, or 
 an acute dodger, or an inefficient workman 
 receiving, on the ground of equality, the 
 payment or the promotion due to energy, 
 ability, and skill. For the same reason there 
 would be a damping down of the willingness 
 to take risks, to adopt inventions, to be frugal 
 and economical and self-denying, if there were 
 
282 THE QUEST OF INDUSTRIAL PEACE 
 
 no rewards which recognise the value of the 
 function fulfilled by capital. This postulate 
 lays down the rule that proportion of reward 
 shall continue, and that no dead and deadening 
 level is to be thought of. At the same time 
 this proportion must not only be just. Its 
 justice must be made evident in open court 
 and common covmcil. 
 
 Ill 
 These four postulates, however they may be 
 expressed, or may require to be defined, must 
 be accepted before there can be industrial 
 peace. The covenant, or treaty, or agreement, 
 or whatever term may be used, must deal only 
 with the sphere of industry, accept the method 
 of Capitalism, adopt co-operation between 
 capital and labour, and realise the truth, 
 imposed by the constitution of human nature, 
 that reward must be fairly proportionate to 
 desert. These are merely canons of justice, 
 and they have the sanction of wisdom. They 
 have received the verdict of the judgment of 
 history, and even Lenin has shown that he 
 has been taught that they mark out the path 
 of prosperity and peace.^ In English-speaking 
 countries they are really axiomatic and are 
 
 ' Cf. Pour la Russie, March 31st, 1921. Lenin's speech to the 
 Tenth Congress of the Communist Party. 
 
AN INDUSTRIAL COVENANT 283 
 
 universally recognised. What is required is 
 their application in the articles of a covenant 
 of peace. 
 
 The vital and determining considerations 
 in industry have been expressed as ' produc- 
 tion, distribution and exchange.' But it may 
 be questioned if exchange, in its modern de- 
 velopment, lies within the sphere of industry 
 at all. It has no place in the claims of labour, 
 and has never been included in any definite 
 demand. Exchange, in every sense of the 
 term, is too delicate and complex to be brought 
 under rules. It is too world-wide and inter- 
 national, too deeply involved in problems of 
 tariffs and duties, of credit and currency, to be 
 the subject of merely industrial legislation, 
 much less the sphere of any socialistic move- 
 ment. It is too intimately affected by geo- 
 graphical considerations and racial habits and 
 tastes to be included within the scope of a 
 definite and delimiting covenant. Of the other 
 two spheres of industry production may be 
 the more difficult to regulate, but distribution 
 is the more immediate and urgent question. 
 The distribution of goods is really a part of 
 production, but the distribution of the profits 
 of industry is where the battle always begins, 
 and there the conflict is fiercest. In the 
 articles which we now outline we begin with 
 
284 THE QUEST OF INDUSTRIAL PEACE 
 
 the questions involved in distribution. If 
 agreement can be reached in this regard the 
 problems of production may be resolved. 
 
 I. The first article of a covenant of peace 
 should be that there must be a fair and 
 equitable distribution of the profits of 
 industry. 
 
 The words ' fair and equitable ' may seem to 
 be too vague and colourless to be of any 
 service in the articles of a covenant. But 
 these words must be taken as a keynote, and 
 subsequent articles will make them definite, 
 and interpret their meaning. The absolute 
 necessity for this fairness and equity is the fact 
 that stares every one in the face to-day. Who 
 can say that the distribution of profits has been 
 fair and equitable ? The capitalist has taken 
 remorseless advantage of the rise and fall of 
 markets. He has exploited the necessities of 
 a time of war. He has resisted demands for 
 a rise in wages, when that ought to have been 
 given. As a consequence he has not only 
 amassed wealth but has lived a privileged and 
 even luxurious life. This can be seen in the 
 sudden and enormous increase of wealth in 
 almost all industries. In the manufactures of 
 iron and steel, of woollen and cotton goods, 
 in the leather industry, in the supply of the 
 
AN INDUSTRIAL COVENANT 285 
 
 common necessities of life, and notably in 
 shipping and in engineering, vast profits have 
 been made. Every employee is well aware 
 of the inflated prices charged for the goods 
 he makes or sells. In some trades enormous 
 reductions are being made, and yet some of 
 these reductions do not entail a loss. What 
 other result can this have but a deep resent- 
 ment on the part of workmen against those 
 who have been able to receive high dividends, 
 put large sums to reserve, and ' water ' the 
 capital, at the same time as they were refusing 
 to share their profits with their employees. 
 
 The most distinctive proof of the necessity 
 and primacy of this article is to be fou!nd in the 
 coal strike of the spring of 1921. Some of the 
 demands then made were sympathetic with, 
 if not inspired by, Russian Sovietism. Others 
 were aimed at the constitution of the State. 
 Others were really urgent upon a larger share 
 both of the profits, and of the ease of life on 
 the part of the capitalist. But the heat and 
 venom of the strife were generated by a sense 
 of unfairness and of inequity. The claim for 
 a wage which could be paid only by an unjust 
 State subsidy, the insistence on a national pool, 
 and even the stupid, wasteful, and violent 
 stoppage of the pumping at the mines, were 
 motived by a vengeful hostility against mine- 
 
286 THE QUEST OF INDUSTRIAL PEACE 
 
 owners, who had not had regard to a fair and 
 equitable profit. It was openly confessed by 
 many strikers that what seemed to be acts of 
 sabotage were designed to waste the enormous 
 gains, made evident by the large dividends, 
 received by the coal-masters. The first article 
 of a covenant of peace must be a fair and 
 equitable division of profits. 
 
 II. The second article should be that the 
 first charge on the product of industry 
 shall be the due reward of labour. 
 
 That is a necessity, for the labourer must 
 live if he is to work. But his life must be a 
 fairly full and free range of days, with a sense 
 of comfort and of enjoyment both in his labour 
 and in its reward. It cannot be right for one 
 man to live in a self-indulgent ease, and for 
 another equally industrious, to be continually 
 on the verge of want. That reward must be 
 gained by honest toil, and it must not come out 
 of the pocket of any other citizen. It must 
 be a profit which is the yield of the industry. 
 But it must be fair and equitable not only in 
 regard to the profit of capital, but in regard to 
 the laws of economics. It must be such a 
 reward as the industry can bear, and therefore, 
 any claim for any one industry to receive a 
 national subsidy, or any attempt to exact wages 
 or conditions of work which limit or injure 
 
AN INDUSTRIAL COVENANT 287 
 
 other industries, is not the due reward of 
 labour. It is a selfish exaction, and is 
 neither fair nor equitable. Yet the mainten- 
 ance and security and comfort of the labourer 
 must be the first charge on the profit of the 
 industry. 
 
 III. The third article should be that capital- 
 after all running costs, including re- 
 pairs, insurance, taxation, and 
 renewal of machinery, with all ex- 
 penses of management, oversight and 
 advertising have been met — shall 
 receive a fixed and tax-free dividend. 
 
 The amount of that dividend is not easy to 
 settle, and while it would be fixed, it would 
 require to be open to revision. The suggestion 
 might be considered that its amount should 
 be double the current bank rate — averaged 
 throughout the year— for that, in view of a 
 further provision to be stated below, would be 
 regarded as fair and equitable. This fixed 
 dividend is no novel conception. It has the 
 sanction already of the large commercial enter- 
 prises. The dividend both on Preference Stocks 
 and on Debentures is a fixed dividend, and the 
 capitalist takes his chance of a further dividend, 
 or of none at all, according to the prosperity of 
 the enterprise. The capitalist manager or 
 overseer will be paid for his work and service, 
 
288 THE QUEST OF INDUSTRIAL PEACE 
 
 as directors already are remunerated. He 
 will be rewarded for his risk by this dividend. 
 But beyond that those who have invested their 
 capital, without giving personal service, would 
 be entitled to share this common profit, justly 
 earned by the risk and use of their savings 
 and sacrifices. 
 
 IV. The fourth article should be that any 
 surplus profit, after labour has been 
 remunerated and capital has been paid 
 the fixed dividend, should be divided 
 between the capitalist and the labourer, 
 in the proportion of twenty-five per 
 cent, to labour, and seventy-five per 
 cent, to capital.^ 
 
 That proportion seems fair and equitable. 
 Labour is made secure of its reward in any 
 and every event. Labour cannot afford to 
 take risks. Profit-sharing, at one time greeted 
 with acclaim, has always broken down because 
 labour cannot, and will not, share the losses. 
 So that when capital takes the risk not only 
 of the failure of a dividend, but it may be of 
 utter loss, it must also receive the larger share 
 of any surplus. It must also be requited for 
 those years in which the dividend may be 
 
 ' The proportion here is a suggestion only. It may not seem 
 just. It may not be just in some industries. It is the only real 
 reward which capital can secure. 
 
AN INDUSTRIAL COVENANT 289 
 
 ' passed ' by a more abundant reward in the 
 years of prosperity. The fat years must always 
 pay for the lean. 
 
 The advantages of such an article are 
 evident and manifold. No lon,ger will the 
 capitalist be charged with unfair and ex- 
 tortionate exaction. No ' longer . would any 
 demagogue declaim Marx's stupid doctrine 
 of ' surplus value.' Beyond these important 
 results it is clear that capita^ and labour would 
 ba^e a common interest in the prosperity of the 
 business. There would be no requirement of 
 the policing either of capital or labour, and no 
 need of watchful, suspicious, and accusing 
 foremen. The overseer wo^ild be the kindly 
 and acceptable leader on the shop floor. Every 
 man would be under the inducement of a 
 sufficient motive to do his best. The slacker 
 and shirker would be resented by his fellow 
 worker, and the incompetent would no longer 
 be regarded with favour, although neither 
 mercy nor charity would be denied him. 
 Above all, goodwill and fellow feeling would 
 be engendered, and these are large elements 
 both in productivity and in profit. It is not 
 too much to say that this habit and vice of 
 striking, not merely for what seem to be large 
 issues, but for every supposed infringement 
 of a rule or a right, would be extirpated, and 
 
290 THE QUEST OF INDUSTRIAL PEACE 
 
 the loss and bitterness which seem to outsiders 
 so needless, would not be suffered. 
 
 V. The fifth article should be that every 
 worker shall be at liberty to invest his 
 savings in the industry in which he is 
 employed. 
 
 This article is simply an endorsement of a 
 practice already observed. It is the article 
 on whose working the well-deserved success 
 of the Co-operative Societies depends. It has 
 been adopted in many industries and by a large 
 number of the more liberal-minded employers. 
 They allow not only a bonus on the turn-over 
 of each department, which is simply a share 
 in the dividend, but they encourage their 
 employees to invest their savings in the 
 business at a fixed and liberal rate of interest. 
 During the past few years some industrial 
 firms have requested loans from their em- 
 ployees, even for small sums, which are secured 
 on the whole capital and profits of the business, 
 and for these they have paid eight per cent. In 
 reality these employees have become the de- 
 benture shareholders of the company. The 
 result has been an added interest in the 
 prosperity of the business, a quickened appre- 
 ciation of the value of wise management and 
 efficient oversight, and a deepened sense of 
 
AN INDUSTRIAL COVENANT 291 
 
 security and of self-respect, which, we are 
 assured, are so ardently desired. Beyond these 
 notable gains there has been a marked advance 
 in habits of punctuality and courtesy and of 
 sobriety and frugality, inspiring both manhood 
 and womanhood to a loyal citizenship of a great 
 State. 
 
 VI. The sixth article should be that labour 
 must be associated with capital in 
 the carrying on of the industry. 
 
 This article reaffirms the third postulate 
 that there should be co-operation between 
 capital and labour. This conception, and the 
 claim behind it, have been wronged by the 
 thoughtless use of a misleading and mis- 
 chievous term — ^the term ' control.' Control, 
 whether on the part of capital or labour, is a 
 word which must be disused. It is a blow at 
 liberty. Capital must neither control labour, 
 nor be controlled by labour. Industry cannot 
 go on if labour is to dictate to capital. It 
 cannot be efficient, or wisely ordered, or 
 economic, unless there is management with 
 responsibility, untrammelled initiative, and 
 therefore, authority. Under the articles 
 already set down the management would be 
 continually under review by the employees, 
 and their conduct of the business would be 
 
292 THE QUEST OF INDUSTRIAL PEACE 
 
 put to the test of experience. But the office 
 must not be controlled by the shop floor, or 
 the warehouse department. The hands must 
 not guide the head, although the hands must be 
 considered, or both will suffer. As a matter 
 of fact control of any kind, in spite of meticu- 
 lous and nagging rules, has failed.^ 
 
 It may be further ventured that if capital 
 should not exercise control, labour does not 
 really desire it. What labour wants and 
 really strikes for, is a fair and equitable wage, 
 reasonable hours of labour, well-considerfed 
 and solicitous conditions, in which the personal 
 touch is evident. Beyond these, and as 
 urgently, every working man is eager for 
 security, and for a measure of independence 
 and a recognition of his partnership in pro- 
 duction, whereby he may keep his self-respect. 
 He does not desire to be involved in the 
 management and the oversight. He is well 
 aware that the average working man has no 
 competence for the methods of the coimting- 
 house, and cannot share in the conduct of the 
 commercial interests of the business. He is 
 equally aware that every large enterprise must 
 have leaders, who are men of power and of 
 
 ' Cf. The frontier of Gontrol. A Stxidy in British Workshop 
 Polities, by Carter L. Goodrich. This careful volume gives wit- 
 nesi, perhaps unwittingly^ of the absurdity and the constant 
 irritation of the petty attempts at labour ' control. ' 
 
AN INDUSTRIAL COVENANT 298 
 
 oversight, and that there must be those who 
 give orders and those who obey. What he 
 wants, and wants rightly, is an association 
 with the interests of the business, and a regard 
 for his service, which is as indispensable as 
 that of the directors at its head. The privates 
 in a battalion are quite well aware that they 
 cannot do the work of the Staff, and have no 
 desire, however keenly they may criticise, and 
 may often have a just criticism to make, to be 
 called into consultation on either tactics, or 
 strategy, on advance or withdrawal. 
 
 This association of industry, which is not 
 control, must be recognised. An element in 
 this recognition is that of co-operation, so far 
 as possible, and publicity in all that any one 
 associated in production ought to know. A 
 master of industry injures himself and hinders 
 the progress of his business if he does not win 
 the confidence and goodwill of his employees, 
 and that can be done only by openness both of 
 mind and hand, and especially by pubUcity. 
 The directors should have delegates from the 
 workmen, sitting at their meetings, at stated 
 times of the year. The inner circle of the 
 oversight should take counsel with these 
 delegates before any step affecting conditions, 
 or hours, or wages is taken. At least twice a 
 year, as is the case in commercial affairs. 
 
294 THE QUEST OF INDUSTRIAL PEACE 
 
 some statement should be issued to the em- 
 ployees engrossing the history of the past six 
 months, and the prospects for the future. If 
 objection be made that other competing firms 
 might be tempted to take advantage of such 
 confidence, two replies are sufficient. As a 
 rule these other firms are quite well aware of 
 any important steps about to be taken by their 
 competitors. And if there would be loss, that 
 would be more than compensated by the 
 loyalty and goodwill of their workmen. Once 
 a year a full statement of the working of the 
 firm should be issued. This would be in- 
 evitable, if the foregoing articles were accepted 
 and adopted, and its result would be not 
 merely an increased output, a larger profit, 
 but a harmony between labour and capital 
 which would make the carrying on of an 
 industry a supreme satisfaction in life. To- 
 day it is a constant anxiety, sometimes a 
 sleepless, because profitless, care. 
 
 VII. The seventh article should be that the 
 articles of this covenant of peace, 
 and their interpretation and enforce- 
 ment, shall be committed to a Board 
 of Industry, consisting of thirty 
 members — ^ten representing labour, 
 9>ppointed by the Trades Union ; 
 
AN INDUSTRIAL COVENANT 295 
 
 ten representing capital, appointed 
 by a confederation of employers ; 
 and ten representing the consumer or 
 general public, appointed by the 
 Government. 
 
 This should not be a Department of the 
 State. It should have no power to grant, or 
 to promise money, or even to suggest a subsidy. 
 Taxation, and the imposition of any financial 
 burden, must have their initiative and entire 
 control within the House of Commons. But 
 this Board of Industry would exercise a 
 constant oversight in the sphere of industry. 
 All questions which were likely to occasion 
 dispute, every claim for increase of wages, 
 and every proposal to reduce wages, would 
 first be laid before the members of the Board 
 in common council. All that pertained to the 
 conditions and hours of labour, with all that 
 seemed to affect the rights and liberties both 
 of employer and employee, would be brought 
 before this court. So that any action taken 
 either on behalf of labour, or on behalf of 
 capital, without having first been submitted 
 to the investigation of this court and to 
 the arbitrament of its members, would be a 
 defiance of the law. The obligation of 
 publicity, the right of taking evidence, the 
 
296 THE QUEST OF INDUSTRIAL PEACE 
 
 liberty to make inquiry and examine witnesses, 
 and to order a secret ballot, would be among its 
 lawful privileges. 
 
 IV 
 
 It is not too daring to venture the assertion 
 that were the four postulates accepted, and 
 the first six of these articles recognised as a 
 method of translating justice into terms of 
 peace, the seventh article could be set in 
 operation. The powers it confers are advisory, 
 consultative, interpretative and judicial. 
 These are the peculiar and potent offices 
 needed at the threatening of strife. This 
 Board of Industry would be a clearing-house 
 for all claims, a court of appeal in all dispute, 
 and a special jury when charge and counter- 
 charge were made. 
 
 By common admission this is what men are 
 feeling after to-day. The most admirable 
 Whitley Councils prefigure it, though they 
 seem to be too limited in scope and in power. 
 Every joint meeting of employers and em- 
 ployees, and every Commission appointed by 
 the Government, with even the suggestion, 
 so rarely adopted, of delegates from labour to 
 the Conferences of capital, all seem to be 
 aiming at this more definite and more per- 
 manent consultative court. Such a Board of 
 
AN INDUSTRIAL COVENANT 297 
 
 Industry avoids the appointment, so often 
 futile, of a special Commission, with members 
 already ranged on two sides and facing each 
 other in bitter debate, if not in personal 
 animosity. The Sankey Commission did 
 almost irreparable harm. Not only was there 
 the unprecedented wrong of allowing members 
 of what was virtually a jury to enter the 
 witness box, but there was the embittering 
 outbreaks of personal taunt and unrestrained 
 accusation, which only deepened the strife 
 between the contestants. The permanence of 
 the membership of the Board of Industry, 
 and the third mediating constituent, would 
 give a measure of impartiality. 
 
 There may be an objection drawn from the 
 cost of such a permanent Council. But if it 
 coiJd, to any appreciable extent, fulfil its 
 function, the cost would be actually and com- 
 paratively a most moderate sum. It would 
 not be more costly than the succession of im- 
 potent and partisan Commissions which have 
 been appointed, and if it succeeded in averting 
 strikes, or even in mitigating their severity 
 by reaching a decision which could be accepted, 
 there would be prevented not only the im- 
 mediate loss, because of the cessation of 
 production, but the incalculable loss of 
 trade to the whole community, together 
 
298 THE QUEST OF INDUSTRIAL PEACE 
 
 with the allaying of suspicion and hate and 
 revenge. These also have their economic 
 value. 
 
 A broad review of the other advantages of 
 such a covenant and such a Board of Industry 
 make them both to be objects of keen desire. 
 Their action would secure that a wasteful and 
 vengeful strike would not be hastily under- 
 taken. It would lift all industrial questions 
 out of the instant arena of politics, and prevent 
 their being used as an instrument for domina- 
 tion, either by majorities or minorities. It 
 would prevent the xmjust profits and the 
 insolent pride of the capitalist turned profiteer, 
 and it would check the blinding of the mind 
 and the arousing of the passions of working 
 folk by ignorant and ambitious demagogues. 
 It would increase the wealth of the people 
 even more than has been done by the institution 
 of Savings Banks and Co-operative Societies, 
 and give them both a larger area of interest. 
 Beyond these advantages the existence of a 
 Board of Industry, constituted with a member- 
 ship enjoying first-hand knowledge and fresh 
 evidence, and above all composed of men 
 whose first interest is peace and goodwill, 
 would prevent any too swift and too rigid 
 decision, and their power to interpret and to 
 amend the articles of the Covenant would keep 
 
AN INDUSTRIAL COVENANT 299 
 
 them in correspondence with the necessities 
 of the case. 
 
 One of the finest minds of our generation has 
 declared that righteousness, peace and joy are 
 the three most desirable things in the world. 
 The order must be observed. There must 
 first be righteousness, and then peace. After 
 these, and not until these have been attained, 
 can men enter upon joy. Every observer of 
 the times is aware that what throbs within 
 the hearts of all men on both sides of the strife, 
 who are not self-seekers or place-hunters, is a 
 desire for these three things, and especially for 
 the third— the joy of life. The appeals which 
 uplift all men are those that touch a fuller and 
 freer, more secure, and more joyous round of 
 days. The noble passion for the social well- 
 being of all has never ceased to move every 
 honest-minded man since Ruskin proclaimed 
 it in his prophetic message. The counsel is 
 clear that the first obligation is to be just, and 
 the second is to seek the things that make for 
 peace. Then, and not until then, can any 
 method or project or system, or any increase 
 of wealth or of ease, minister to joy. But when 
 righteousness and peace are met together the 
 new heaven over men's heads and the new 
 earth under their feet will be found at the 
 dawning of the new day. But it must not be 
 
800 THE QUEST OF INDUSTRIAL PEACE 
 
 forgotten that the only abounding joy is not 
 in the flesh, and in the sating of its desires, 
 but in the spirit. Have the men who are 
 crying in every market-place, and in the ears 
 of the people for merely earthly satisfactions, 
 understood this truth ? 
 
 Printed in Great Britain by T. and A. Constablb Ltd. 
 at the Edinburgh University ProGs 
 
Cornell University Library 
 HN 31.C54 
 
 The quest of industrial peace. 
 
 3 1924 002 692 253