Correction (1933)

From the October 1933 issue of the Socialist Standard

The Origin of Unemployment Insurance.

In an article in the September issue. "Do Social Reforms Kill Socialism?" it was implied that Unemployment Insurance was directly borrowed from Germany. This appears not to have been the case. Health Insurance was directly borrowed from Germany, and the working of the Health Insurance system there was known to those who introduced Unemployment Insurance in England, but although the practice of Governments making payments to the unemployed was, of course, known, the principle of insurance had not been applied to it. In a Liberal Party publication, “A Nation Insured," written by Leo Chiozza Money, and published in 1911, it was stated that "in unemployment insurance Britain is leading the way."

This correction does not affect the argument contained in the article.

Ed. Comm.

Fiscal fatuity. (1908)

From the September 1908 issue of the Socialist Standard

Mr. Chiozza Money is a ‘cute man ; but he nods at least as often as Homer. Just now he is engaged in making “One Hundred Points for Free Trade,” or rather, one hundred points against Protection, in the Daily News. This is one of them :

“The Protectionist theory is that imports, especially imports of manufactures, cause want, unemployment, and pauperism.

Well, every year India imports large quantities of manufactured goods, and nearly all of them are imported from the United Kingdom.”

***

Mr. Money might have found—it would have been a difficult job, but he might have found—a happier example. In India the people die literally like flies from “want, unemployment, and pauperism” and their results. The onus is on the Free Trader to explain the absolute unredeemed impotency of Free Trade in “our great dependency.”

***

The Protectionist is of course in no better case. He has to explain why “want, unemployment and pauperism” are rampant in every industrial country where his pet nostrum is in operation. Protectionist and Free Trader are alike unable to face the facts. They have to resort to all sorts of mean and pitiable dodges to escape facing facts. From a working-class standpoint there isn’t the worth of a tinker’s anathema between them or their precious systems.

***

Poverty is the result of certain definitely ascertained causes. Fiscal schemes do not remotely affect those causes. The workers are poor because they have no control of the product of their labour and are, therefore, robbed of the great proportion of it. Free Trade or Protection may, in certain cases and under certain conditions, result in a particular trade or trades receiving a fillip. To that extent there might be more work available. But that would also necessarily mean more robbery. And the workers are poor because they are robbed.

***

Besides, the fillip must in the nature of capitalist things die down. Supply would overtake and outstrip available demand. There is not a single commodity in general requisition that the present machinery of production could not satisfy the effective demand for several times (often hundreds of times) over. Given the fillip and competitive machinery would be working at breakneck speed to be first in the market with the goods. Result : overproduction, slump, unemployment, starvation and the miseries necessarily attendant thereon.

***

The process is characteristic of free trade and protected countries indifferently. If the worker is employed he is robbed. That is the unalterable condition of his employment. He must make a profit for his master. If he is not employed he starves. In either case he is no more than a pawn in the competitive game. He is dependent upon the fluctuations of the market—upon the employer who works him at top speed until he has produced too much, and then throws him off until the surplus is exhausted.

***

The waste, necessarily the accompaniment of this competitive game, is only obviated under capitalism through monopoly. With one source of supply the output may be regulated to the demand. But Free Trader and Protectionist alike shriek (publicly) against monopoly, and howl dismally against waste. They are just mean dodgers or abnormal ignoramuses—they want to eat their cake and have it. The trust (monopoly) is the perfection of production. The trust stage is inevitable. It will produce most economically. It will save labour. It will mean more unemployment. And it is inevitable—Free Trade or Protection notwithstanding.

***

Mr. Money’s note has lured me into an article. I am sorry ; but I am a victim of circumstances. I intended no more than a par. But the fiscal folly of the Free Trade Moneys and the Zollverein Wilsons always cause me to curse privately and slam publicly. They are so dam silly ! The whole point is that “want and unemployment and pauperism” are inevitable under capitalism ; that although Free Trade or Protection may conceivably give an impetus to a certain trade it cannot absorb the available labour, and even if it could, labour would still be robbed ; that there is no explanation of the poverty problem other than that given by the Socialist; that there is no solution other than that offered by the Socialist.

***

The working class of every capitalist country in the world is in a state of chronic “want, unemployment, and pauperism” because it does not own the wealth it alone produces. It doesn’t own the wealth because the land and machinery of production are owned by the capitalist class. It never will own its product until it owns and controls this land and machinery. And it never will own and control the land and machinery until it thoroughly understands its own position and the conditions of change, and has organised its forces for the specific object of effecting that change.

***

The work of the Socialist Party as against Tariff Reformer, Social Reformer, Fiscal Laissez Faireian, or what not, is, therefore, the education and organisation of the working class for the overthrow of capitalism through the capture of the powers of government in order to secure the product of labour from being annexed by the capitalist class. Virtually the working class is in possession of the machinery of production since the whole process from top to bottom is in working-class hands. The workers now require to assert their possession and secure it, and at the same time the result of their toil, by the control of the fighting arms through political conquest. Simply that.

Alegra.

Shall We Work Harder? (1909)

From the August 1909 issue of the Socialist Standard

Mr. W. H. Lever, M.P., writing in the Anti-Socialist says,

“The more consideration I give to the aims and objects of the Socialists the more I am confirmed in my opinion that Socialism cannot possibly achieve social betterment and increased social happiness.

“Whatever poverty we have to-day is entirely due to the fact that the world is not producing sufficient commodities to satisfy the world’s requirements. Not until we have a greater production of all that goes to make for social well-being shall we have a more even distribution of social well-being and comforts and less poverty.”

Now to see if poverty is due to an insufficiency of wealth to meet the world’s requirements.

Mr. Chiozza Money informs us in his “Riches and Poverty” that the annual aggregate income of the United Kingdom amounts to, roughly, £1,700,000,000 or £40 per head of the population, or, assuming that each family on the average consists of five persons, £200 per family.

But is the annual income so distributed that each family receives £200 per annum, or a proportionate sum according to its number ? The answer is obvious to any member of the working class. About half the wealth produced (and corresponding income), or £830,000,000, is taken by about 1 million persons, each with an income of over £160 or, again assuming that each of these persons is the head of a family of live we get 5 million people, while the other half, or £880,000,000, is taken by 38 million persons, all of whom are in receipt of less than £160 per family yearly. But if we extend our investigation a little further we shall find that 1,250,000 persons enjoy an aggregate annual income of £585,000,000. At one end of the social ladder we have ”one third of our population living on the verge of hunger,” while at the other end we have 250,000 persons, or with their dependents, 1,250,000 persons, enjoying an aggregate income of about £450 per head or £2,250 per family.

Yet Mr. “Millionaire” Lever informs us that he is of the opinion that we must first increase the amount of material wealth before we can “achieve increased social betterment.” 

Increase the means of wealth production to any extent you like and it can be shown that the workers would be where they are to-day—in poverty. (An instance is recorded in our issue of March last under the heading “A Cutting Cutting” where a surplus of textile products provided a splendid opportunity for a lock-out of the operatives and a little more starvation.) The introduction of new and cheaper methods of production, and therefore, means of producing wealth in greater abundance, to-day only results in the throwing out of employment many of the workers engaged in the particular industry in which the new methods are introduced, an increase in the army of the unemployed, greater poverty and misery for the workers. True, a reduction in the time necessary for the production of the necessaries of life means the cheapening of the cost of living ; but a fall in the cost of living results in the cheapening of the production and maintenance of the worker. The continued and enhanced competition of the workers for jobs soon reduces wages to the new cost of subsistence, while a decrease in wages results in the increased exploitation of the worker, a greater amount of surplus-value or profit for the employers, and an even greater disparity between the two classes. So then, while the means of production and distribution remain in the hands of a small section of the community, any new inventions that may arise to lessen the time necessary for the production of wealth only results in increased affluence and luxury for the few while the great bulk of the people remain in a perpetual state of poverty.

Not until the whole of the means and implements of production and distribution are owned and controlled by, and in the interest of, the entire community, will the great mass of the people enjoy the advantages that accrue from an improvement in the means of wealth production. Then, and not until then, will every new invention be hailed as an advantage to all, either to reduce the collective labour of the community or to increase the comforts and opportunities of its members.

If then, it is possible to produce sufficient wealth to satisfy the requirements of the whole community under the present wasteful competitive system, how much more within the bounds of possibility will it be under a system where competition for existence will be entirely eliminated and where industry will be so organised that only that labour which is absolutely necessary for the production of wealth will be expended, where the large army of people now engaged in the advertising trade, as travellers, policemen, soldiers, man-‘o-warsmen, workhouse officials, flunkeys, judges, lawyers, clerks, priests, and a host of others would be employed in useful, productive labour. These trades and professions arise out of and are necessary under a system based upon the private monopoly of the means of life, and will disappear with their transformation from private to social property.

Mr. Lever continues “The natural order of social progress must inevitably be first to produce material comfort, followed by intellectual, moral and social advancement.” It is something for a member of the capitalist class to recognise the necessity for satisfying the material wants and requirements of the community before any improvement in the intellectual and moral status of the people can be effected. When the means of decent living are assured to all, then and only then will the great mass of the people be elevated from the physical, intellectual and moral enslavement in which they are enveloped to-day. The means of life can only be assured to the whole of society by the demolition of Capitalism and the establishment of Socialism. This can be achieved when the workers get to understand their true class position, see the necessity for the change and determine to emancipate themselves from the slavery in which they exist to-day, brush aside the idea that “Socialism will not come in our time,” and realise the fact that as soon as the workers, who outnumber the other class by about eight to one, understand and determine to have Socialism, they will get it. As the late Lord Salisbury once said, “Nothing can go against the voice of the people.”

So then, join the S.P.G.B. immediately you understand and agree with its principles, and make one more pillar in the foundation of the Socialist Republic.

H. A. Young

Profit versus Wages. (1908)

From the May 1908 issue of the Socialist Standard

Many railway stocks have (1) been deliberately watered, and (2) risen in price on the market, so that while railway men are badly paid, the present holders of the stocks are apparently making small profits. Many railway companies have enlarged their ordinary capital by the delightfully simple process of multiplication by two. £100 of original stock has been changed into £100 of “preferred” and £100 of “deferred.” This has not been done behind the scenes, but boldly and with the permission of our rich men’s parliament. As a consequence it is made to appear that the net receipts of railways are only about 3½ per cent. of their “paid up” capitals. But the nominal capitals have not been “paid up” ; and even in so far as the original capital is concerned much of it is unreal. Thus the magnitude of the injustice which they suffer is hidden from railway servants. They risk their lives for the public every day and what do they get for it? In 1904, the 27 leading railway companies paid in wages only £29,000,000 or only 25/- per employee per week ! These 27 companies own nearly all the railway lines, employ nearly all the railway servants and make nearly all the profits assessed by the Inland Revenue Commissioners. And what do these profits amount to ? As I have shown, they amount to nearly £40,000,000 per annum, or far more than is paid in wages in one of the most dangerous and most useful of all occupations. 

– Chiozza Money, M.P., in “Riches and Poverty.”

The Socialist Forum: A question of gold and prosperity. (1931)

Letter to the Editors from the December 1931 issue of the Socialist Standard

A question of gold and prosperity.

Editor of Socialist Standard.

Sir,—Your notion that the relation between gold and trade depression is “an illusion,” and that it can be “easily dispelled” is erroneous. The relation is not, as you seem to imagine, such that the stock held by individual countries can secure their prosperity in face of world depression. The relation is between the rate of increase of the world’s stock of gold as against that of other primary products, and the statistics for the period 1850-1913 show that when this relative gold supply was increasing primary prices rose, and that when it decreased their prices fell—vide the figures and chart of Professor Cassel and Mr. Kitchin re-published in the first interim report of the Gold Delegation of the League of Nations. The ill effects of a downward trend of prices upon industry and employment are well established, and the relation between gold and trade depression is now only disputed by those who are concerned to maintain a deflationary policy, or who are ignorant of Professor Cassel’s work.

Geoffrey Biddulph.

Church Street, S.W.7.

October 18th, 1931.

Reply:

Mr. Biddulph “corrects” a notion which we do not hold. That he attributes it to us can only be due to careless reading of the article in question. We made it quite clear that we were concerned (as indeed, we always are) with the main problem of the workers, not with the problems of different sections of the capitalist class.

The difference between Mr. Biddulph and ourselves can be illustrated from his notion that rising prices, due to an increasing supply of gold, mean prosperity. We do not deny that prosperity may come to the manufacturing and trading capitalists : but what of the workers?

The table to which Mr. Biddulph refers us, and from which we have ourselves quoted recently, shows a very great increase in the world supply of gold from 1890 to 1914. Do we, then, find the workers prosperous? In 1901 Mr. Seebohm Rowntree found a third of the workers below a very meagre level of existence which he called the poverty line. In 1903 Sir Henry Campbell-Bannerman endorsed Rowntree’s findings and declared that “about 30 per cent. of the population is living in the grip of perpetual poverty.” In 1904 Sir Leo Money (then Mr. Money) ascertained that 96 persons out of every 100 died owning less than £100, while the other 4 out of every 100 possessed an average of over £9,000 each. He found that about one-seventieth of the population owned far more than half of the entire wealth of the United Kingdom.

If this is what Mr. Biddulph means by-prosperity—i.e., prosperity for the few—we do not dispute it. But we repeat our statement that the main problems of the workers have nothing to do with the supply of gold.

Ed. Comm.

Building trade’s decline. (1914)

From the September 1914 issue of the Socialist Standard

A leading article with the above heading was published in the “Daily Chronicle” of Saturday, July 11th, 1914. This article is remarkable for the damaging information against the private ownership of the means of life, and for the “tender-heartedness” shown by this capitalist politician. Mr. Chiozza Money, M.P., the author of the article, has, as usual, condemned the economic and political state of the country, and switches the attention of working-class readers to Parliament—the saviour of the people—the place from which can issue the commands, the admonitions, the laws to make it so that all shall be well for the working class in the “better times” that are coming under capitalism.

Mr. Money says: “Between 1901 and 1911 an army of men passed out of the building trade in England and Wales, and that in spite of an increase in population of three and a half millions. Whereas in 1901, the population being 32,500,000, the Census showed 1,042,864 men employed in building and works of construction, in 1911, the population having advanced to 36,100,000, the number of persons employed in building and works of construction fell to 946,127. Three more years have elapsed, and in the interim, there is reason to fear, the number of persons employed in the industry has been stagnant or even subject to further decline. . The decline in employment is therefore a very serious thing for the nation, merely regarding the matter from the point of view of engaging our people in worthy occupations. When, however, we remember the nature of the industry concerned, we have to deplore in the figures referred to, not merely a decline in a noble employment, but a decline in the consumption of buildings, and especially of buildings in their aspect as the homes of our people.” Noble employment! Ye gods! So noble that the State has taken pity on those employed in the building trade to the extent of seven shillings unemployed benefit and ten shillings on sick ; so noble that they swarm like bees about a big job, and try to get the “glad eye” of the foreman ; so noble that when in work they have to speed up and compete one against the other—”Brothers” in the branch, and Brutes on the job.

We of the Socialist Party can tell where a great many of the builders’ “hands” have gone. Many have been forced to seek the shelter of the “Homes” provided for those broken on the wheel of industry—the workhouses ; many have “downed tools” for good, and walk the streets of “Old England” with “dull-eyed melancholly.” Hundreds have packed up and gone to distant lands with, the hope of getting “the staff of life” easier, and of securing a better prospect for their children. They have left this “tight little island,” blessed with hundreds of Acts of Parliament passed in the interest of the working class—so we have been told—left the land “blessed” with the history of “great men” who have looked after those who worked in “noble occupations.” “The Salvation Army” can account for some who have “got out and got under” ; in the workshops of the “Blood and Fire” brigade they have tasted the sweets of capitalism.

Mr. Chiozza Money has criticised the workings of capitalism, and we must try and “better the instruction.” Let us quote again. “It is fundamentally important that Britain should be rebuilt. It is by far the most important social question. The inside of a house matters much, and the outside of a house matters no less. Between their interior and their exterior aspects, buildings for an industrial nation become the framework of the lives of the majority of its people. They either let in or keep out the sun. They either form beautiful and healthy cities or environ town populations is ugliness and misery. They either make or mar our lives. Let no man imagine that by securing himself in a decent home he has rid his own person or his own family of the curse of bad housing. A house can never be an individual thing or a private thing. . . The private investor has failed and is failing to give the nation the houses which it needs. With the money which has been invested abroad in the last four years by British investors every slum in this country could have been wiped out, and when I say this I use the term ‘slum’ to include not merely the most squalid streets, but to cover about one-fifth of all the town dwellings of the country.”

What is the “remedy” of this capitalist M.P. ? It is to make it the duty of local authorities to “house their people well,” and to assist them with “supplies of cheap capital.” We can understand Mr. Money very well in his insidious way of keeping working-class attention still longer fixed on the lips and promises of the capitalist politicians. We understand from his wail that this social mess in the shape of “houses” is because of naughty capitalists ; much “good” will result when the “good” capitalists predominate. We, of the working class are according to this capitalist prize-fighter—the children of those who house us, of those who feed and clothe us, who pay us wages, and kill our brothers and sisters in Factory, Mill, and Mine, and fine themselves, through a manager, £24 for murdering over 400 miners in a pit in “gallant little Wales.”

Mr. Money wants our capitalist fathers to be more thoughtful for their children; but Mr. Money is in that section of capitalist politicians who raised the load line to suit the ship-owners; who ticketed and numbered the proletariat to suit the masters, and who have mucked about a “Home Rule Bill” for over 30 years while the workers have been stifled in slums—and polish their tools in case something turns up.

“Cheap Capital” to house the workers. Very well. The only way to attain this desired end of capitalist “goody goodies” is to exploit the working class more and more—and improved methods of hastening the wealth production under capitalism will swell the unemployed army, will crowd the workers in the slums, and make them fit instruments to produce wealth for “Cheap Capital.”

We, of the Socialist Party think that it matters everything to preach to the workers that they are wage-slaves; that their so-called decent homes hang together by but a slender thread ; the evolution of a rotten system of wealth production will scatter many home nests of those who think they are safe.

So, then, we are framed in by slums, by unemployed men, by starving children, by factory hells, by want of the necessaries of life in the midst of plenty. We want bread and it is difficult to get—but the steam plough is working. We want decent houses—but the workmen are not allowed to build. We want life, freedom, the obstacles hewn out of our path to get food, clothing, and shelter after the working of our brain and muscle—and some of greatest obstacles in the path of the toilers of the world are those who preach that we are “but little children weak” and they—the “great intellects” who will some day do us some good.

Look to Parliament and see there the agents of the capitalist class, who spin silky words about and around our social sores. When the delegates of the class-conscious workers sit in Parliaments of the World, the days of the “kind perishers” will be numbered.

S. W.

Some publications: Riches and Poverty. (1906)

Book Review from the March 1906 issue of the Socialist Standard

Riches and Poverty, by L. C. Chiozza Money, 5/- nett.

A valuable book. A very valuable book—up to a point. A most effective arrangement of startling figures. An armoury of facts for the propagandist,—facts which the Socialist can use to most excellent purpose. A really splendid compilation of comparative tables so clearly set out that the wayfaring man, though a fool, can see he is being robbed. But the wayfaring man will not see the figures unless they are extracted for him and reproduced in some cheaper publication. The book is too dear.

That is the first criticism we have to offer. Its price puts it out of the range of the possibilities of the purse of that portion of the proletariat who purchase such publications for perusal.

The second criticism is that the book is only valuable up to a point. That point is reached where the tables leave off. After that point the book is still interesting as showing how close a man can sail to the Socialist position without being forced to concede that nothing short of Socialism can suffice to effect that change in the distribution of wealth which Mr. Money desires; as shewing how a man may cut the ground clean from under him and yet proceed apparently indifferent to the fact that he is dancing upon nothing. Mr. Money’s work frequently conveys the same impression. It is as though he sets out with the best of intentions determined that he will not again be baulked in his purpose ; determined to argue his case logically from effect to cause and to put his findings upon record, only to find that a something or somebody lies in wait within that radius which marks the utmost limit of the area over which the capitalist scribe may operate, to prevent his further advance and by the exercise of a power against which he has never apparently prevailed, to turn him back by a painfully circuitous course to the point from which he started. What that something is may be a matter of conjecture—to some. Those unfamiliar with his work might ascribe it to Mr. Money’s lack of knowledge. But we do not share that view. Whatever else it may be it is not ignorance. But it is always successful in its endeavours to head Mr. Money off.

And so it comes about that having compiled valuable data for the Socialist, having given an excellent summary of the national balance sheet and, which is almost equally valuable, shewn how he has arrived at his figures for the different items, having formulated an unanswerable indictment of the present system and made quite clear—by inference—that the system is absolutely rotten at its base and that things as they are can only be materially improved by the destruction of the foundations and the erection of an entirely new social edifice upon a new foundation,—having done this he peters out in a recital of petty-fogging and miserably inadequate proposals, none of which go down to root causes and all of which when realised would, therefore, hardly make any appreciable impression upon the problems they were designed to solve.

The consideration of these proposals occupy one half the book. They are not valuable suggestions. They are not new. They may all be found in the programmes of the many reform organisations whose existence and whose work operate so disastrously to the confusion of the working-class mind. Our concern is for a clear working-class mind. The working class must understand their position and the reasons why that position is so hazardous and unhappy. Because the emancipation of the working class must be the work of the working class themselves. And if they are inveigled into the belief that Mr. Money’s “remedial” measures matter, they are led into a mental bog from which they must extricate themselves before they can organise their strength for the overthrow of the system which causes their misery. While they are doing that they are wasting time and expending their force uselessly.

Therefore, while gladly admitting the value of Mr. Money’s statistics, we consider the last half of his work highly mischievous. He should issue it in two volumes—the statistical part for sale at a few pence; the other part at a few pounds. We make him a present of the suggestion and hope he will act upon it.

A. J. M. Gray

Editorial: Anticipating Beveridge (1942)

Editorial from the December 1942 issue of the Socialist Standard

Writing in advance of the issue of the Beveridge Report on Social Insurance, amidst the deafening clamour that has heralded that much boosted publication, we confidently predict that from a working-class standpoint it will be one of the ripest political red-herrings of our generation. It is one of those occasions when the Socialist prophet cannot go wrong.

In justification of this discordant note in the almost universal harmony we can point to the limited scope of the inquiry, and the well-known anti-Socialist views of the author. The outstanding social problem of our age is the poverty of the working-class. It is not the result of unemployment or of illness, or of industrial accident, or of inadequate powers of wealth production. It exists side by side with great wealth and affects the employed as well as the unemployed worker. It is the result of the private ownership by the capitalist class of society’s means of producing and distributing wealth. The facts of this concentration of ownership in the hands of a small minority of the population are well enough known, and Sir William Beveridge is, of course, quite well aware of them. Nor is it a new story. To go back no further than 1904 we have the telling statement of Sir Leo Money: “It is probably true that a group of about 120,000 people who with their families form about one-seventieth part of the population, owns about two-thirds of the entire accumulated wealth of the United Kingdom.” With perhaps some slight modification, that estimate is still true as other, later, investigators have shown. Sir William Beveridge and others like him may answer that they do not believe it necessary or practicable to abolish the system of society which rests on that foundation, but why is that fact about the basis of the capitalist system excluded and deliberately excluded from this and every other official “investigation” into the poverty problem of the working class? And why should the workers allow themselves to be side-tracked by inquiries into poverty which start off by excluding the major factor in the case? In an address to the Fabian Society on November 21st, 1942, Sir William, according to a press report (Sunday Express, November 22) urged the need for “thorough unbiased investigation and discussion,” but he had already stated the scope of the inquiry so as to exclude any investigation into capitalism itself. The problem, he said, “is that of discovering how to combine the proved benefits of private enterprise at private risk . . . with the necessity of national planning in the aftermath of war.” In short he, and those who selected him for the investigation, are only concerned with the problem of alleviating some of the secondary evils of capitalism.

Those who chose him knew what they were doing. They took no chances. Throughout his public career Sir William Beveridge has been a defender of capitalism, confining his diligent inquiries to fields which exclude the question of a frontal attack on the capitalist system. His concern has never been with the problem why are the working class poor, but always with the problem of providing for the periods when the worker’s income from the sale of his labour power ceases. As he wrote in 1924 in his “Insurance for All and Everything” (published by the Daily News, Ltd.) :

“The problem is not that of guaranteeing an income at all times to everybody irrespective of his work and services. That way lies Communism. The problem is the narrower one of giving security against all the main risks of economic life to those who depend on continuous earning, of arranging that part of what such persons earn by their work shall take the form of provision for themselves and their dependants whenever their work is interrupted or stopped by causes beyond their control.” (Page 31.)

In other words, Sir William, accepting the system which gives the privileged class their property-income without the necessity of working, limits his examination to the problem of legislating for the propertyless class. It is all right though for the capitalist to have an “income at all times irrespective of his work and services.”

On occasion Sir William Beveridge has attempted to justify his bias for capitalism and its inequality. He did so in a speech on November 10, 1942 : “To concentrate on absolute equality of incomes for all men is an unpractical and a wrong aim. It attaches excessive importance to material things and treats envy as our master passion” (News-Chronicle, November 11, 1942). Of course nobody ever suggested anything so unpractical as trying to build a social system on private ownership of the means of production and “absolute equality of incomes,” but we need not here go into that caricature of Socialism. What is of interest is the slick defence of our millionaire-pauper system with the ethical argument that to aim at equality attaches excessive importance to material things, and treats envy as our master passion. It was ever the trick of those who have material things monopolised in their control to deprecate the sin of envy in the dispossessed. What, we might ask, of the greed of those whose motto is “What we have, we hold”?

In conclusion, we may quote a passage from Sir Leo Money’s “Riches and Poverty” (1904). Commenting on the way in which reformers of his day ignored the facts about inequality, he used a description which might well be applied to Sir W. Beveridge and othere of his kind : —

“Our most ardent reformers discuss their plans without reference to the economic framework of the society which they propose to reform. As a result we get a vast amount of misdirected effort, a dreary outpouring of vague and empty rhetoric . . . and a succession of timorous proposals for reform ludicrous in relation to the nature and magnitude of the problems with which they seek to deal.”

Something will perhaps result from the Beveridge proposals after they have been discussed elaborately to the exclusion from many workers’ minds of the real poverty problem, and after being scaled down in the customary way. Thus they will serve the main purpose of those who instituted the inquiry, but unless the workers themselves speedily attack the problem of the achievement of Socialism, another ten years will find a new and vain inquiry being started to clear up the mess left behind by Beveridge.

Facts for Socialists. (1907)

From the June 1907 issue of the Socialist Standard

The contention of the Socialist that the whole working class is sweated is amply proved by the evidence of even our opponents. The National Anti-Sweating League, organised in a vain attempt to deal solely with the worst effects of capitalism, provides in its “Report of the Guildhall Conference on a Minimum Wage,” information from which may be deduced not alone the futility of the League’s attempt to destroy effects without removing the cause, but also the fact that the description given by the Socialist of the position of the working class is not in the slightest exaggerated.

Mr. Stephen Walsh, M.P., in the course of a paper on “Present Steps towards a Minimum Wage”, said:

“The average wage paid by the employer in 1888 was 5s. a day for the collier in the Federation area. Even in the great lock-out in 1893, when the colliers’ earnings had been uplifted by 40 per cent., the collier could not be earning more than 7s. a day. That might be considered to be a big figure compared with other unskilled trades. But the trade was of a very fluctuating character. It must be remembered that the men were not working more than nine days in the fortnight—in the Midlands, pits were not worked more than three or four days a week. That means that the average wage of the coal hewer comes out at about 28s. a week—a figure borne out by statistics of the money paid in compensation claims. That is the very best class of workman.

“It was in 1894 that a Conciliation Board was formed consisting of twelve representatives from each side, with an independent chairman, who was called upon in the event of disagreement. In 1893 the employers asked for 25 per cent. reduction, and it will be remembered what a terrible lock-out ensued, causing suffering not only to the men but to the public. In 1894 the Conciliation Board was formed, and the men assented to a 10 per cent. reduction. In 1894-96 the Board continued. It lapsed for two years, was revived in 1898, and has since been renewed at periods of three years.

“Although the men have this means of defending themselves, they are still earning, roughly, about 28s. a week. Women and boys are very largely outside the union. The girls working on the surface are also not in the union. In fact, it may be said that something like 80 per cent. of the surface hands are not in any organisation, with the consequence that in negotiations with the employers the men are constantly told that these people must be excluded from consideration. The growing youth cannot have his wages determined by the Board, but they are fixed by the employer’s estimate of his usefulness.

“Girl labour on the surface has existed for more than 30 years, and Lancashire especially suffers from it. A few pits in the south-west district and a large number in Scotland also employ girl labour. Thirty years ago girls were paid anything from 1s. 4d. to 2s. 6d. on the pit banks, and they were working, certainly, not longer hours than at present—even shorter hours in Lancashire. The chances are that a woman will now earn from 1s, 3d. to 2s., 1s. 8d. being about the average. As the working hours are about nine and a half per day the wage cornea out very little better than 2d. an hour. It might be said that the work did not require much skill or physical energy. Cleaning the dross is not heavy work, and pushing the waggons has been done away with. But many of the women are exposed to the inclemency of the weather. The fact remains, too, that these girls are earning less than they did 30 years ago, and have to depend partly for a living upon the earnings of fathers and brothers in the mine. In no case, if we take Lancashire, are the women working, even in good years, more than nine days a fortnight; and a wage of 6s. 9d. a week, with a reduction for the club of which she is a member, is utterly insufficient for a woman’s subsistence wage. Twenty-eight shillings a week paid to a collier are practically wages paid to him and his girls, so that their combined wages may eke out a family living.

“Whereas twenty years ago day wage men were earning 4s. to 5s. a day we find that to-day little more than 40 per cent. is suggested to have been placed on their wages.

“I can only say that this apparent improvement in the men’s position is very illusory ; the generosity of the employer has not been applied. As a matter of fact, when the increased hours of work and the higher price of fuel, household commodities and house rent are considered, the day hands in the mine are in a worse condition than they were eighteen years ago.

“Although one of the most powerful of the trade organisations has been endeavouring to establish a minimum wage for the coal mining industry in the federated area, it has so far not succeeded in doing so. An attempt has been made to abolish the piece rate but there is the risk of inviting competition and bringing in the unemployed compelled by physical necessity. It has been generally found that if a man leaves work in a mine the man who takes his place earns sixpence a day or so lower than the wages his predecessor received. Again, the mining tonnage rate is no indication of the earning capacity of a man. The diversities are so infinite that it is impossible to say what a man can earn on a particular tonnage rate, and so the decision is left to the caprice of the official in the mine.

“We have, however, established over large areas not the mere field rate but price lists and working conditions that have focussed and crystallised payment for varying conditions in the mines. But there is a large section of the mines in which this particular work has not been done.

“Nevertheless, 18 years of continuous effort has failed to delete the present wages system, failed to establish a minimum wage. I can only ask the Conference to consider if a great organisation numbering well over three hundred thousand workers has failed to do this what must be the task of establishing a minimum wage in an industrial body which is hardly organised at all.”

Mr. L. G. Chiozza Money, M.P., in dealing with “Sweating in relation to the National Dividend” said :

“The existence of an enormous number of poor people in what is reputed to be a wealthy country is vaguely known and as vaguely wondered at. It should be the endeavour of everyone who is interested in any one or all of the many phases of poverty to acquaint himself specifically with the best information which is available as to the actual amount of poverty which exists, and as to the facts relating to the manner of distribution of wealth which makes poverty so common. Armed with this material, those who sympathise with the sweated can show with near approximation what amount of underpayment of labour exists throughout the country as a whole, and the criminality of gross underpayment in view of the available resources of the nation.

“By the National Dividend we mean the aggregate of all the incomes, large and small, of the people of the United Kingdom. We can form an approximately correct idea of its extent by adding to the incomes of the income tax paying classes, as ascertained by the Inland Revenue authorities, an estimate of the total amount of wages and small salaries earned by those who have not the pleasure of paying income tax. I give a brief account of how I arrived at the income of the British people in 1904.

“First I take the gross assessment to income tax for 1903-4 which is nearly £903,000,000. I correct this, on the one hand, by deducting items which are not real income, such as the cost to a landlord of repairing his house, etc., and, on the other hand, for amounts of income which ought to come, but which do not come, under the attention of the authorities. These various corrections, with the details of which I do not burden this paper, reduce the £903,000,000 of gross assessment to £830,000,000, which figure represents the net income enjoyed by the income tax paying classes.

“Now that disposes of an enormous amount of income, but only of a very small number of people, for the income tax is levied upon those who are in receipt of upwards of £160 a year, so that we have not got very far in point of population. Below the income tax line we have to deal with not only the whole of what are commonly called the manual labour classes, but with those other orders of poor people who, in a very real sense, are working men, viz., small tradesmen, clerks, shopmen, travellers, canvassers, teachers, agents, small farmers, inn-keepers, lodging house keepers, civil servants, pensioners, and so forth. From a close examination of the census records I have arrived at the conclusion that there are about three millions belonging to those occupations who earn less than £3 a week. How much do they earn on the average ? I have gone over that very carefully and believe that their average earnings cannot be placed higher than £75 a year, ranging from the 8s. or 10s. a week of the office boy to the £3 a week of the superior clerk. Accepting this estimate tentatively, we get as the income of this particular part of the working population £225,000,000.

“It remains to deal with the greatest bulk of all, viz., the manual workers commonly so-called, including, in addition to all those engaged in agricultural, industrial, and domestic service, soldiers, sailors, policemen, and postmen.

“Those, using the census of 1901 as a basis, I estimate to number 15,000,000, men, women, boys, and girls, in the year 1904. Unfortunately, we have not in this country, as we ought to have, a permanent and continuous census of wages. We are very neglectful in the matter of records, and the only official census of wages which we have ever made was got out in 1886 by the Board of Trade. I have used this as a basis and allowed for the changes of wages which have taken place since that date.

“In 1886, the average wage, giving due weights to the respective proportions of men, women, and children, was only 17s. 6d. per week. In 1904, allowing for the general rise in wages in the interval, it amounted to 20s. 6d. per week. It should be borne in mind that this figure represents rates of wages and not earnings. If we want earnings we must make an allowance for idleness from whatever cause arising, whether from sickness, accident, lock-out, strike, weather, slack time, total unemployment, or drink. Allowing for these things, we cannot assume that the average wage is earned for more than 44 weeks out of 52 weeks in such a year as 1904—20s. 6d. a week for 44 weeks means £45 in the year.

“But we have to consider that not all those who figure in the census sheets as manual workers can be counted as normal workers. There is the great army of casuals, ne’er-do-wells, aged persons, men and women broken in health, and last, but not least, those employed in what are called sweated industries. I do not think that, of the 15,000,000 manual workers, we can estimate these most unfortunate of the industrial army at less than one-fifteenth of the whole, or say, 1,000,000 persons. The earnings of these 1,000,000 persons I estimate at £25,000,000 per annum, or an average of about 10s. per week per person.

“The remaining 14,000,000 manual workers I assume to draw the average earnings of £45 a year already referred to, which amounts to £630,000,000. With the £25,000,000 of the unfortunate 1,000,000 persons we arrive at £655,000,000 as the total earnings of the manual labourers in 1904.

“We have now got out the aggregate income of the United Kingdom, made up as follows :—

(a) Those with over £3 a week… £830,000,00

(b) Those with less than £3 a week (Manual workers £655,000,000 plus, lower middle classes,

£225,000,000) ……£880,000,000

……………….£1,710,000,000

“It will be seen that the income respectively above and below the income tax line of £3 per week is almost equal in amount. £830,000,000 lies above the line ; £880,000,000 lies below the line.

“The important consideration now arises, how many people enjoy these respective amounts of income—how many people in our nation of 43,000,000 people have over £3 per week? This important question I have been able to answer, and as the method of obtaining the answer has survived a great deal of both friendly and hostile criticism, it may be taken as being as nearly accurate as is needed for a proper judgment to be formed in the matter. The number of income tax paying individuals is, as nearly as possible, one million. It follows that nearly half of the income of the nation is possessed by one million people, who, if each of them be taken as a representative of a family of five, stand for only 5,000,000 people in the nation of 43,000,000 people. The second half of the national dividend is shared up by the balance of the nation, viz., 38,000,000 of people.

“These are exceedingly significant and extraordinary facts, but even more significant and extraordinary is the further calculation which I will now put before you.

“I have been able to split up the one million income tax payers at the £700 a year line. Between £160 a year and £700 a year there are 750,000 taxpayers, representing 3¾ millions of people, who take only £245,000,000 out of the £830,000,000. The balance of the £830,000,000 is £585,000,000, and this enormous sum is the annual income of only 250,000 taxpayers, who represent with their families not more than 1¼ million of the entire population. Broadly speaking, one-thirtieth of the entire population take more than one-third of the entire national dividend of the country. To put it in another way, 1¼ million people take in rent and interest a sum as large as the entire earnings of the manual labour classes, who, with their dependents, number 30,000,000 of people.

“The 250,000 taxpayers who take nearly £600,000,000 worth of income, include in their number, of course, the owners of practically all the factories, docks, warehouses and workshops of the country. The small number of income tax payers will, perhaps, not seem so surprising if it is remembered that there are only 100,000 factories in the whole of the United Kingdom, while the total number of factories, workshops, docks, wharves, quays, and warehouses registered in the United Kingdom does not amount to more than about 250,000.

“There is much talk of small shareholders, but as a matter of fact, shareholders, both large and small, are remarkably few. There is a firm in the City—Messrs. George S. Smith and Son—who collect all shareholders’ names, and make an alphabetical list of them for advertising purposes. Mr. George Smith informs me that there are only 500,000 names on his lists, which are practically complete, so that of the 1,000,000 people above the income tax line, only one-half are shareowners. The whole of the railway stock of the country is owned by only 180,000 people.

“It would be the easiest possible matter, if I had time, to put before you hundreds of current balance sheets, and to show you by existing examples the manufacture in detail of the contrasting elements of Riches and Poverty, which I have already shown you in the gross. The process is going on every where around us, and I hold that it is futile to talk about remedies for sweating while we consent to methods which produce poor people who, in their turn, are catered for by the supply of sweated products. The poor are the chief customers of the sweater.

“I do not propose to place many examples before you, but content myself by presenting several striking ones which may be taken as illustrative rather than exceptional. I have examined for 1904 the balance sheet of Messrs J. Lyons and Co., who employ a very large number of young girls at low wages. I find that the Company’s gross profits on trading for that year are £474,000, while salaries, wages, rents, rates, repairs, horse-keep, maintenance, etc., only come to £327,000. There was, therefore, a net profit of £147,000. I don’t know exactly what salaries and wages come to, but it is clear from the balance sheet that they were less than the £147,000 worth of profit. Thus the sleeping partners got more than the working partners.

“The case of the Newcastle-on-Tyne Electric Supply Company Limited is even clearer. I have the balance sheet for 1905 which shows that the people of Newcastle paid the Company £145,000 for Electric current, etc., and that the Company paid for rent, coal, etc., only £37,000 ; for wages only £34,000, leaving a profit of £74,000. Here the sleeping partners took far more than the working partners.

“Take again the National Telephone Company’s balance sheet for 1904. The public paid the Company £2,000,000, and the total outlay for rents, wages, materials, management, etc., was £1,150,000 leaving a net profit of £850,000. It is perfectly clear from these figures that the sleeping partners took far more than the working partners.

“I should like it to be particularly observed that when I refer to wages in connection with these balance sheets I mean not only wages for manual labour but for mental labour also.

“I repeat that it is unnecessary to multiply examples but these lamentable contrasts between profits and wages are a common-place of limited ability balance sheets.

“It is the fact that the underpayment of labour is deliberately counted upon which makes it possible for company promoters to promise large dividends. Thus, in a gas company prospectus issued in the public press in 1905, it was deliberately calculated that labour, manual and mental, would cost less than £2,000 per annum, while nearly £6,000 of profit per annum would result from the operations.

“It should not be forgotten, also, that ursury grows by what it feeds on. As soon as the big dividend is realised, ursury can claim its capital value in the stock market and the rise in value of the shares, instead of adding to the remuneration of the worker, actually becomes a weapon to be used against him. This, again, I may illustrate. I wrote in the Daily News of the 30 per cent. dividends and the low wages of Messrs. Lyons and Co. An indignant shareholder immediately wrote to me to point out that: “Most of the shareholders have paid £6 or £7 per share, and so get a return of not more than 5 per cent.”

50 Years Ago: The Coal Strike (1963)

The 50 Years Ago column from the April 1963 issue of the Socialist Standard

A million miners are out on strike. From the ferment around us one might think they were asking for the mines. Every foul epithet and calumny is being hurled at them by the hireling Press. It is they who are unpatriotic; it is they who are ruining the trade of the country; it is they who are bringing the people to starvation. No one suggests that the mine-owners, who cling so tightly to the last atom of profit which they can screw out of those who go down into the pits, are culpable.

Of course not. Is it not only fair and just that capital should have its reward? And who can say that the mine-owners are any too well recompensed for his risk and his labour? Not the capitalist papers, certainly.

These drew many fancy pictures of the fabulous wages and astonishing luxury of the miners, and marvelled that there was anything left for the owners at all. Yet within a week of the men ceasing work the Press rang with the cries of the miners' starving wives and children, and Mr. Chiozza Money, M.P. showed from the Income Tax returns that in the last nine years the owners had made over 200 million pounds out of the unpaid labour of the workers!

It is said that the granting of the minimum wage would only cost £50,000 a year, which is less than 1 per cent of the profit the masters take, and a very minute fraction of their capital. It is a pregnant demonstration of what the meaning of the word “Patriotism" is on the masters' lips when they plunge the country into such misery for the sake of so insignificant a morsel of dividend.

From the Socialist Standard, April 1913.

Has British trade a future? (1926)

From the December 1926 issue of the Socialist Standard

(Continued from last month).

“Mr. Suma is to study the business conditions in East Africa, whose ports have never been visited by Japanese mercantile ships. The N.Y.K. and the O.S.K. have opened the new East Africa service in April with a view to promoting the business between Japan and East Africa. The Navy has advised the Foreign Office to send an official to East Africa in order to study customs, local circumstances, and economic conditions there aboard one of the warships, which the Navy Office has scheduled for the cruise along East Africa. The Foreign Office has been selecting the official since. The squadron is to leave Japan early next month, and will come back in January next year.” (“Osaka Mainichi,” 30/5/26.)

The “Bombay Chronicle” of July 23rd, 1926, quotes the “Japan Chronicle” of April 8th, 1926, to the following effect :—

“The “Asaki” reports that the scheme of the Foreign Office to further Japan’s economic development in Persia and the South Seas is making fair progress. The Supplementary Budget for the fiscal year 1926-27 includes an item relating to investigations into trade development in the South Seas involving Yen 24.299, and another item bearing on similar investigations in Persia and neighbouring countries to Yen 56.204. With regard to the investigation into economic conditions in Persia and neighbouring countries, it was started soon after Mr. Obata, Ambassador to Turkey, arrived at his post some time ago, and, judging from the results of the sample exhibition of Japanese exports which was held at Constantinople, it is hoped that it is not altogether impossible for Japanese goods to be exported to the Balkans, Asia Minor, Persia and Afghanistan, to the amount of Yen 100.000.000 a year. At a conference on investigations with trade development, which is to be held at Constantinople for ten days from the 20th inst., it is expected that recommendations to be submitted to the Foreign Office will be considered and adopted. These recommendations will furnish valuable materials for reference for those Japanese traders who wish to export their goods to those countries. In the meantime the Government is contemplating establishing Consulates where they are required for trade purposes.

As regards trade development in the South Seas, the Foreign Office is to call in Tokyo a conference of Consuls appointed to Calcutta, Batavia, Singapore, Bombay, Sydney, Manila, Hongkong, Haifong, Saigon, Rangoon and Bankok, at which will also be present the officials of the Departments concerned and business men chiefly interested in the South Seas’ trade. At this conference matters relating to Japan’s economic development in those districts will be thoroughly studied.”

At the moment, India is feeling very seriously the effect of Japanese competition, and the Bombay Millowners’ Association has submitted a statement to the Muf Board showing how they are hit by the competition of Japan. Extracts from this report are published in the “Bombay Chronicle” for July 20th and 23rd, 1926. The following excerpts are taken from the extract:—

“Japanese competition was severe, and in certain instances Japanese goods were offered at prices lower than the cost price of similar goods manufactured in India. . . .

…. The mill industry is suffering from the unfavourable rate of exchange with Japan and highly organised Japanese competition.

Japan, owing to her larger production of yarn and piece-goods for export has a much better balanced trade than India.

In piece-goods the position is much more unfavourable to India, the value of India’s piece-goods export trade to China being only about one-tenth of what it was ; Japan’s trade has increased forty or fifty-fold.

What strikes one most in considering the growth of Japanese competition is the amazing rapidity with which her imports into this country have gone up. It may be broadly stated that in 1914-15 the total imports of Japanese yarn into India were less than a million pounds, while in 1924-25, i.e., about ten years later, the quantity imported was more than 32 times the figure of 1914-15. Again, in piece-goods, the quantity imported in 1914-15 was about 16 million yards, and in 1925-26 it had risen to nearly 220 million yards.

. . . . . . . . . . . . .

It is this extraordinary rise every year in Japanese imports which fills with dismay the minds of everybody who has a stake in the cotton mill industry of the country. If the Japanese imports go on increasing at the present rate one hesitates to contemplate the plight in which the cotton mill industry of the country will find itself in about five or six vears’ time.

. . . . . . . . . . . . .

It is forgotten that not only is Japan dealing severe blows to Indian manufacturers in Indian markets, but she is making rapid inroads in the export markets. In the words of the Administration Report of the Bombay Presidency for 1923-24, “Since 1917 China has been practically a closed market for Indian piece-goods, owing mainly to the expansion of the indigenous textile industry and to the rigour of Japanese competition.”

India has practically lost her export trade in yarn, and since this yarn has necessarily to be utilised in manufacturing cloth, it is of the utmost importance to develop the export trade, but here again Japan with the unfair advantages she is enjoying over India is proving a very formidable rival, for not only has she ousted India from the Chinese market, but is rapidly capturing her foreign markets, e.g., Egypt, East Africa, etc.”

There is a pretty kettle of fish for Chiozza Money to stew ! The above quotations only deal with one branch of Japan’s activities, but it must be remembered that she produces the bulk of the world’s silk; that she is conscious of her shortcomings in the coal, iron and steel industries; and is making strenuous efforts to remedy them; that she has a cheap and almost unlimited supply of labour to call upon; and that in the matter of factory legislation, particularly with regard to hours of labour and female and child labour, she lags far behind the other advanced countries.

Japan’s neighbour China is in the industrial melting-pot. China is making strides in the way of producing to meet her own needs, and when she too commences to make a serious attack on the world’s markets— well, there will need to be some “reductions in the cost of production” to meet the twin eastern commercial menace !

To come down to the position from the worker’s point of view, we can see in the struggle for markets a terrific development in machine-production and elimination of human assistance in the production of goods. This would be very acceptable if the workers owned the machines, but as the employers own them, it means the elimination of jobs. Without jobs, no wages; and without wages, no bread—or the workers must decide that it is time they reaped the multitude of advantages accruing to those who own and control the means of production.

Gilmac.

Has British trade a future? (1926)

From the November 1926 issue of the Socialist Standard

A month or two back Chiozza Money wrote a series of articles for the “Daily Chronicle” on the “World Race for Trade.” On May 21st, he describes a visit paid to Sheffield where he inspected Cammell Laird’s works. He found that the efficiency of these works was equal to anything he had seen in America, and yet there is any amount of plant idle, in some instances the works were only working at half capacity.

In dealing with this question of idle plant, he makes the following observations :

It all comes to one word—Markets. There are the Dominions and India, but they are markets not reserved to us. Moreover, in 1926, the world is out of joint. We have to wait for better times. That those better times will come we may rest assured. The world must, sooner or later, need a much greater supply of iron and steel than it now calls for. The efficiency of Sheffield will not always go unrewarded. 

Now it is all very well to “rest assured,” but it is much better to know a little of the possibilities of the assurance being well-founded.

In a further article on June 7th, he says :

Foreign competition is increasing and will increase. The expanding markets for which we may legitimately hope will demand less of crudely manufactured and more of artistic productions. Intense and growing foreign competition will make it necessary for British exporters to increase their efforts, and for British manufacturers to adopt every good economic device.

He then goes on to urge that trade unions should welcome the adoption of the best-known machinery and improvements in methods of work. He tacks on to this the well-worn recommendation for a friendly co-operation in economic endeavour between employers and workers.

He makes three main points : (1) that a world-wide expansion in trade is coming shortly; (2) that if English manufacturers reduce their costs of production they will get a large share in it; (3) that an increase in trade makes it possible for the workers to claim a larger share of the product.

We will take a few quotations from different sources that have a general bearing on the questions raised.

As Chiozza Money has concerned himself very much with America, the following quotation from the “Christian Science Monitor” is very apt. We quote it at length, as the points raised are so interesting.

Absorption of surplus production presents one of the outstanding difficulties of the American manufacturer according to Alvin K. Dodd, of the Department of Domestic Distribution, Chamber of Commerce of the United States, speaking at the thirteenth annual convention of the Society of Industrial Engineers here [Philadelphia].

The former necessity of meeting the existing demand has been succeeded by the question of making a demand for the over-supply, he said. Growth in population, he continued, is only about 16 per cent. above that of 1913, and, if we accept 30 per cent. as the increase in facilities, for manufacture, a capacity exists seriously in excess of what might he called the normal demand on pre-war rate of production.

The result of this is seen, he declared, in exaggerated forms of competition, extraordinary displays in advertising, extraordinary costs, unusual growth in methods of distribution, and. finally, the latest expedient, instalment selling which is not appeased by anything less than the payment of next year’s income for this year’s product.

With the situation of America as stated above, unable to get rid of a large excess of production, and itching to find fresh outlets for her goods, the race for the satisfaction of the possible expanding market ingoing to be keen.

Let us take another quotation.

Walter T. Layton, Editor of the “Economist,” makes a contribution to the discussion in the “Manchester Guardian,” of April 20th last, from which we take the following extract :—

In these circumstances are we most likely to find the much-needed expansion of our foreign trade in the markets of Europe or of the Empire? It must be admitted that the prospect of attaining free trade within the Empire or of making it self-sufficient is not very promising. India, which is much the largest of the Imperial markets, is evidently determined to maintain some measure of protection against British manufactures. Canada, whatever may happen in the political field, is destined to come increasingly within the economic sphere of influence of the United States—a significant sign of which is the fact that Canadian enterprise is no longer financed mainly from London, but from New York. Even Australia is determined to foster her iron and steel, textile and other industries and to keep out British goods as fast as she can replace them at home. The ties of Empire are very real and lasting ones, but no one can look at the map of the world and truthfully say that the British Empire is a natural economic unit or that Great Britain. can find a complete outlet for her economic activities in the Empire.

According to the above, and the source should be authoritative, the Empire does not hold out much hope to the English manufacturer in the event of a general expansion of trade.

Let us go farther afield. Let us probe into the condition of the Eastern lands of mystery and hope, and see what prospects for the European manufacturer exist there.

Japan has learnt much from the West, and turned her knowledge to good account. The “Osaka Mainichi,” June 30th, 1926, has an article on Japan’s growth in prosperity from which we take the following information :—

In 1887, eighty-four per cent. of the foreign trade of Japan was handled by foreign merchants. Of the imports, eighty-five per cent. was handled by foreign firms. During 1894-5, the native firms commenced to increase in activity, and by 1900 they handled thirty-five per cent. of the exports and thirty-nine per cent, of the imports. The Russo-Japanese War of 1904-5 was a great impetus for an enormous expansion of the foreign trade of Japan, and the increasing influence of Japanese traders. But the Great War of 1914-18 was the real opportunity of the Japanese merchants.

Taking advantage of the world demand for silk and cotton piece goods, more than 10 Japanese firms went to the extent of establishing their branches in Wall Street and Madison Square, where almost prohibitively high rents were demanded, and conducted their business, paying high cable rates. The activities of the Japanese merchants then alarmed the Americans, who may be generally classified as amateurs in foreign trade.

The Japanese view of the American foreign traders is worth noting. “Amateurs” ! !

Of late years there has been an enormous development in trustification. The slowing down of European manufacture for foreign markets and for ordinary products in the home markets gave Japan her chance. There was an enormous expansion in Japanese manufacture and trade, and a wild scramble among the producers. Small firms grew rapidly and joined with large corporations.

The post-war panic and the following years of depression caught many of the Japanese corporations in the swirl. Some were driven into bankruptcy along with many private firms. Later, when things were on the mend again, the tremendous earthquake gave them a further set-back. Since the earthquake, things have steadily improved, and Japan is turning greedy eyes abroad for an outlet for her surplus population and surplus goods. At the present date the bulk of Japanese foreign trade is handled by native merchants. The trust companies have greatly developed, and are preparing a stronger attack upon the markets outside of Japan.

The Japanese have learnt other things, besides manufacturing and trading, from the West. They have learnt how to cover commercial aspirations with a halo of sanctity, as witness the following quotation from the Editorial in the paper mentioned above :

We repeat here that the object of overseas expansion of a nation is to open up the natural resources of the undeveloped lands, and to spread the civilisation in uncivilised regions. Any country which contravenes this common principles of humanity should at this opportunity realise the fundamental mistake of shutting the doors of the country to foreigners.

Japan’s neighbour, China, could say a lot on the first part of the quotation, while the last part is a knock at Russia, for “In Asia, there is a vast undeveloped territory of fertile soil in Russian Siberia” !

The harbour facilities of Japan have been greatly improved lately, and the number of ports open to foreign trade increased up to forty-one, of which by far the most important are Yokohama, Kobe and Osaka.

The way the Japanese set about capturing foreign trade is German in its thoroughness. The following quotation will illustrate how they do it :—

The Foreign Office has decided to send Mr. Vakichiro Suma, one of the administrative officials belonging to the Office, to East Africa by either the Asama or the Yakumo of the Japanese Training Squadron, which is to cruise along the East African coast via Turkey, Malta, Marseilles, Barcelona, and Cape of Good Hope, for the first time.

Gilmac.

(To be concluded next month.)

Fifty Years of “Progress” ! (1925)

From the December 1925 issue of the Socialist Standard

The Economic Position of the Workers.

(Concluded from last issue)

We have now seen how pauperism has grown over the last 50 years and how the workers have become poorer during the latter half of that period, and it is time to ask whether the capitalist class have shared that poverty. On the contrary we find that in respect of the wealth produced this country has grown continually richer up to 1914. Sir W. Beveridge (Econ. Journal, Dec., 1923) gives the following figures of Real Income per head of the population, after allowing for the movement of prices. The figures represent, therefore, a statement of the production of “real” wealth, not merely money prices :—

1860 £26.0

1870 £29.6

1880 £34.1

1890 £40.0

1900 £45.9

1910 £46.9

He clearly explains that while more wealth was being produced it was only the workers who suffered, their loss being the gain of the propertied class.

“From 1900-1913 we lived on a rising tide. This also is an element favouring capital as against labour, profits, rather than wages.”

And again :

“The smooth development of Victorian days was broken, but the characteristic of the time was inequality of fortune rather than general misfortune ; discontent rather than poverty; a gain by capital in relation to labour, by profits in relation to wages, by some classes of workmen at the expense of others, even more than a check to our progress as a nation.”

Least of all was the poverty of the workers due to natural causes:

“Europe on the eve of war was not threatened with a falling standard of life because nature’s response to further increase in population was diminishing. It was not diminishing; it was increasing. Europe on the eve of war was not threatened with hunger by a rising real cost of corn ; the real cost of corn was not rising ; it was falling.”

A. L. Bowley (“The Change in the Distribution of the National Income, 1880-1913”) estimates the division of the national income as between “Property” and “Wages” at 37½ per cent, and 62½ per cent, respectively; and, further, that this percentage was nearly constant over the period. In this he differs from Mulhall (“Dictionary of Statistics”), who considered that in 1881 the percentage going to property was only 21 per cent. Sir Josiah Stamp (Statistical Journal, July, 1919) estimated the then percentage of “Property” at 32 per cent.

It is, however, necessary to point out how misleading is the classification used by all the above. An enormous number of workers are not engaged in the production and distribution of wealth at all, but are simply employed as personal servants or as profit “snatchers” out of the field of production proper.

Thus the services of the cook and the gardener and the valet are obviously enjoyed only by their employer, the property owner.

Yet in the above classification their wages go to swell the proportion of the “workers.”

If we follow the more useful method adopted by Sir Leo Chiozza Money, the picture is presented in another light. He shows how much of the wealth produced actually goes to the workers who produce it.

He estimates the wealth produced in 1913 at £2,150 millions, and says :—

“The manual workers, who, with their dependents, accounted for about two-thirds of the entire population, took about one-third of the entire national income, while the income-tax payers, with their dependents, forming only about 5,000,000 of the population, drew nearly as much as the remaining 41,000,000.” (Fifty Points about Capitalism, p. 13.)

The remaining portion went to the 4,000,000 clerks, shopkeepers and assistants, small farmers, etc. He considers that the division remained in 1924 approximately what it had been in 1913.

The exploitation of the workers is well illustrated from another angle by the statement made by Mr. Spencer. Liberal M.P. for Bradford, and quoted from the Daily News (New Leader, October 19th, 1923) : —

“If you look at the returns of the profits of this firm (Saltaire, Ltd.), you will find that by good management and skill they made a profit of £137 per head on each of their workpeople. Sir Isaac Holden,. Ltd., the woolcombers, made a profit of £140 per head of their workpeople last year. …”

Here we see how the workers’ wages could be doubled out of the wealth they produce.

We may notice here how the same process of declining real wages and increasing profits has gone on in America.

“In the period from 1897 to 1915, when real wages were falling in spite of an enormous increase in national production, business profits far outran the rise in the general price level. . . . From 1897- 1913 railroad and industrial stocks advanced about 100 per cent. . . . Moreover, this was a period in which huge corporate surpluses were being set aside out of profits.”—(American Economic Review, March, 1925.)

WHO OWNS “YOUR COUNTRY”?

As for the distribution of capital (as distinct from that of annual income), Professor Henry Clay (Times, March 24th,1925) wrote : “It is probably safe to say that over two-thirds of the national capital is held by less than 2 per cent, of the people.” As he also pointed out, such inequality was unknown in eighteenth century England.

WASTE OF WEALTH.

Last of all we come to the question of our wasted powers of production. While the workers grow poorer, it is becoming ever easier to produce the things they lack. Labour, land, machinery, etc., exist in excess of society’s needs, and only capitalism forbids the production of wealth for the use of those who do not possess legal rights to property in the means of life.

Sir Leo Chiozza Money estimates that 1923 production was from 15 per cent. to 20 per cent. less than that in 1913 (New Leader, January 4th, 1924), and shows (“Fifty Points,” p. 44) that in 1907

“counting as a man a male worker aged 18 years and upwards, there were only 4¼ million engaged in producing. . . . The remaining 10,000,000 workers were engaged in transport, or commerce, or professions. When allowance is made for the useful workers amongst these, it is clear that the nation has to support millions of persons condemned by the capitalist system to be non-producers.”

To this add the enormous increase in numbers of unemployed and the still greater increase in powers of potential production due to inventions, etc., and we can then realise how the workers’ actual position compares with what economic conditions would permit it to be under another system of society.

If we take a few typical industries we shall see how great the development is, and also what are the effects of greater efficiency under this system. Thus Mr. Coppock, giving evidence in March, 1925, before the Court of Inquiry presided over by Lord Bradbury, stated that whereas 3,000 million bricks were laid in 1914 by 73,671 bricklayers, in 1921 5,000 million bricks were laid by only 57,170 bricklayers. More efficiency and its accompanying less employment are threatened in still greater degree should a proposed bricklaying machine prove commercially profitable.

“The Triangular Construction Company, of Imber Court, Surrey, have given the first public trial to a simple piece of machinery, invented by Major W. H. Smith, its managing director, which, worked by one skilled bricklayer and a labourer, can erect the walling of houses at a rate equivalent to the laying of 15,000 bricks a day.”—(Daily News. October 21 si, 1925.)

In the agricultural industry of America, it is stated by T. G. Risley, Solicitor of the U.S. Department of Labour, that :—

“the American farm labourer produces an average of 12 tons of cereals per year, while the foreign farm labourer only produces 1½ tons of cereals per year. … In 1920 there were 1,500,000 fewer men on farms in America than in 1910, yet the crops produced were one-third greater in 1920.(O.B.U. Bulletin, Winnipeg, October 1st, 1925.)

In the automobile factories in the U.S.A. the following startling progress has occurred. The figures represent the average number of cars produced per worker per

annum in the various years : —

1899 1.66

1904 1.80

1909 2.47

1914 7.17

1919 8.97

1921 11.15

1923 16.11

They are taken from a report to the Department of Labour submitted by M. W. La Fever.

Almost every capitalist country and every industry could furnish evidence of like developments, and were the achievements of the most advanced countries applied all round, the task of producing all the reasonable requirements of the world’s peoples would be incredibly simple. Our powers of production are, in fact, as Sir Leo Chiozza Money puts it:—

“Our working power is not less, but far greater than our needs.”—(Triumph of Nationalisation, p. 18.)

ABOLISH CAPITALISM.

But these powers cannot be used to the full and freed from the hindrance of periodic crisis and depression, and the unemployed cannot be allowed to produce because the machinery of production is in the hands of the capitalist class or Governments and Municipalities controlled by them. Only the abolition of private ownership can remedy the evil for the workers. Failure to take this necessary step, and every year’s delay in doing so, leaves the workers faced with certain increase of unemployment, certain increase of insecurity, and certain worsening of their condition relative to that of the employing class, because of the inevitable growth of society’s powers of producing wealth. Although for a time, during the early expansion of capitalism, the workers were able to secure a rising standard of living, the tendency in all the leading capitalist nations, including the Colonies of the British Empire, has been for “real” wages to fall since the opening years of this century. While the level in this country may still be higher than that of 1870 (The L.R.D. figures would place it at about the level of 1880), there is no prospect of an improvement in any but the most backward areas of the capitalist world. Furthermore, unemployment and pauperism, “speeding up” and insecurity, have definitely operated to worsen the workers’ condition in relation to what it was fifty years ago. Lastly, and most important of all, while the workers have been getting worse off, the means of producing wealth have developed by leaps and bounds. If poverty in 1870 was a phenomenon which many well-meaning observers found incomprehensible, its existence in 1925 is a crime absolutely indefensible, and if only the workers realised, absolutely unnecessary.

Edgar Hardcastle