CHAPTER XI. STATE SOCIALISM.

I. State Socialism and English Economics.

State socialism has been described by M. Léon Say as a German philosophy which was natural enough to a people with the political history and habits of the Germans, but which, in his opinion, was ill calculated to cross the French frontier, and was contrary to the very nature of the Anglo-Saxons. Sovereign and trader may be incompatible occupations, as Adam Smith asserts, but in Germany, at least, they have never seemed so. There, Governments have always been accustomed to enter very considerably into trade and manufactures, partly to provide the public revenue, partly to supply deficiencies of private enterprise, and partly, within more recent times, for reasons of a so-called "strategic" order, connected with the defence or consolidation of the new Empire. The German States possess, every one of them, more Crown lands and forests, in proportion to their size, than any other countries in Europe, some of them, indeed, being able to meet half their public expenditure from this source alone; and besides their territorial domain, most of them have an even more extensive industrial domain of State mines, or State breweries, or State banks, or State foundries, or State potteries, or State railways, and their rulers are still projecting fresh conquests in the same direction by means of brandy and tobacco monopolies. But in England things stand far otherwise. She has sold off most of her Crown lands, and is slowly parting with, rather than adding to, the remainder. She abolished State monopolies in the days of the Stuarts, as instruments of political oppression, and she has abandoned State bounties more recently as nurses of commercial incompetency. She owes her whole industrial greatness, her manufactures, her banks, her shipping, her railways, to some extent her very colonial possessions, to the unassisted energy of her private citizens. England has been reared on the principle of freedom, and could never be brought, M. Say might not unreasonably conclude, to espouse the opposite principle of State socialism, unless the national character underwent a radical change. And yet, while he was still writing, he was confounded to see signs, as he thought, of this alien philosophy obtaining, not simply an asylum, but really an ascendancy in this country. It appeared to M. Say to be striking every whit as strong a root in our soil and climate as it had done in its native habitat, and he is disposed to join in the alarm, then recently sounded at Edinburgh by Mr. Goschen, that the soil and climate had changed, that the whole policy, opinion, and feeling of the English people with respect to the intervention of the public authority had undergone a revolution.

Mr. Goschen had, in raising the alarm, shown some perplexity how far to condemn the change and how far to praise it, but he was quite clear upon its reality, and was possessed by a most anxious sense of its magnitude and gravity. "We cannot," said he, "see universal State action enthroned as a principle of government without misgiving." Mr. Herbert Spencer took up the cry with more vehemence, declaring that the age of British freedom was gone, and warning us to prepare for "the coming slavery." M. de Laveleye, who is unquestionably one of the most careful and competent foreign observers of our affairs, followed Mr. Spencer, and although, being himself a State socialist, he welcomed this alleged new era as much as Mr. Spencer deprecated it, he gave substantially the same description of the facts; he said, England, once so jealous for liberty, was now running ahead of all other nations on the career of State socialism. And that seems to have become an established impression both at home and abroad. The French Academy of Moral and Political Sciences has devoted several successive sittings to the subject; the eminent German economist, Professor Nasse, has discussed it—and with much excellent discrimination—in an article on the decline of economic individualism in England; and it is now the current assumption of the journals and of popular conversation in this country, that a profound change has come over the spirit of English politics in the course of the present generation—a change from the old trust in liberty to a new trust in State regulation, and from the French doctrine of laissez-faire to the German doctrine of State socialism.

But this assumption, notwithstanding the currency it has obtained and the distinguished authorities by whom it is supported, is in reality exaggerated and undiscriminating. While marking the growing frequency of Government interventions, it makes no attempt to distinguish between interventions of one kind and interventions of another kind, and it utterly fails to recognise that English opinion—whether exhibited in legislative work or economic writings—was not dominated by the principle of laissez-faire in the past any more than in the present, but that it really has all along obeyed a fairly well-defined positive doctrine of social politics, which gave the State a considerable concurrent rôle in the social and industrial development of the community. The increasing frequency of Government interventions is in itself a simple and unavoidable concomitant of the growth of society. With the rapid transformations of modern industrial life, the increase and concentration of population, and the general spread of enlightenment, we cannot expect to retain the political or legislative inactivity of stationary ages. As Mr. Hearn remarks, "All the volumes of the statutes, from their beginning under Henry III. to the close of the reign of George II., do not equal the quantity of legislative work done in a decade of any subsequent reign." ("Theory of Legal Duties and Rights," p. 21.) The process has been continuous and progressive, and it suffered no interruption in the period which is usually supposed to have been peculiarly sacred to laissez-faire. On the contrary, that period will be found to exceed the period that went before it in legislative activity, exactly as it has in turn been itself exceeded by our own time. On any theory of the State's functions, an increase in the number of laws and regulations was inevitable; it was only part and portion of the natural growth of things; but such an increase affords no evidence, not even a presumption, of any change in the principles by which legislation is governed, or in the purposes or functions for which the power of the State is habitually invoked. A mere growth of work is not a multiplication of functions; to get a result, we must first analyze the work done and discriminate this from that.

Now, in the first place, when compared with other nations, England has been doing singularly little in the direction—the distinctively socialistic direction—of multiplying State industries and enlarging the public property in the means of production. Municipalities, indeed, have widened their industrial domain considerably; it has become common for them to take into their own hands things like the gas and water supply of the community which would in any case be monopolies, and their management, being exposed to an extremely effective local opinion, is generally very advantageous. But while local authorities have done so much, the central Government has held back. Many new industries have come into being during the present reign, but we have nationalized none of them except the telegraphs. We have added to the Post-Office the departments of the Savings Bank and the Parcels Post; we have, for purely military reasons, extended our national dockyards and arms factories since the Crimean war, but without thereby enhancing national confidence in Government management; we have, for diplomatic purposes, bought shares in the Suez Canal; we have undertaken a few small jobs of testing and stamping, such as the branding of herrings; but we are now the only European nation that has no State railway; we have refrained from nationalizing the telephones, though legally entitled to do so; and we very rarely give subventions to private enterprises. This is much less the effect of deliberate political conviction than the natural fruit of the character and circumstances of the people, of their powerful private resources and those habits of commercial association which M. Chevalier speaks of with so much friendly envy, complaining that his own countrymen could never be a great industrial nation because they had no taste for acquiring them. In the English colonies, where capital is more scarce, Government is required to do very much more; most of them have State railways, and some—New Zealand, for instance—State insurance offices for fire and life. These colonial experiments will have great weight with the English public in settling the problem of Government management under a democracy, and if they prove successful, will undoubtedly influence opinion at home to follow their example; but as things are at present, there is no appearance of any great body of English opinion moving in that direction.

But while England has lagged behind other nations in this particular class of Government intervention, there is another class in which she has undoubtedly run far before them all. If we have not been multiplying State industries, we have been very active in extending and establishing popular rights, by means of new laws, new administrative regulations, or new systems of industrial police. In fact, the greater part of our recent social legislation has been of this order, and it is of that legislation M. de Laveleye is thinking when he says England is taking the lead of the nations in the career of State socialism. But that is nothing new; if we are in advance of other nations in establishing popular rights to-day, we have been in advance of them in that work for centuries already. That peculiarity also has its roots in our national history and character, and is no upstart fashion of the hour. Now, without raising the question whether the rights which our recent social legislation has seen fit to establish, are in all cases and respects rights that ought to have been established, it is sufficient for our present purpose to observe that at least this is obviously a very different class of intervention from the last, because if it does not belong to, it is certainly closely allied with, those primary duties which are everywhere included among the necessary functions of all government, the protection of the citizen from force and fraud. To protect a right, you must first establish it; you must first recognise it, define its scope, and invest it with the sanction of authority. With the progress of society fresh perils emerge and fresh protections must be devised; the old legal right needs to be reconstructed to meet the new situation, or a new right must be created hitherto unknown perhaps, unless by analogy, to the law. But even here the novelty lies, not in the principle—for all right is a protection of the weak, or ought to be so—but in the situation alone; in the rise of the factory system, which called for the Factory Acts; in the growth of large towns, which called for Health and Dwellings Acts; in the extension of joint-stock companies, which called for the Limited Liability Acts; in the monopoly of railway transportation, which called for the regulation of rates; or in the spread of scientific agriculture, which required the constitution of a new sort of property, the property of a tenant-farmer in his own unexhausted improvements.

This peculiarity of the industrial and social legislation of England has not escaped the acute intelligence of Mr. Goschen. Mistrustful as he is of Government intervention, Mr. Goschen observes with satisfaction that the great majority of recent Government interventions in England have been undertaken for moral rather than economic ends. After quoting Mr. Thorold Rogers' remark, that these interventions generally had the good economic aim of preventing the waste of national resources, he says: "But I believe that certainly in the case of the Factory Acts, and to a great extent in the case of the Education Acts, it was a moral rather than an economic influence—the conscientious feeling of what was right rather than the intellectual feeling of ultimate material gain—it was the public imagination touched by obligations of our higher nature—which supplied the tremendous motive-power for passing laws which put the State and its inspectors in the place of father or mother as guardians of a child's education, labour, and health." ("Addresses," p. 62.)

The State interfered not because the child had a certain capital value as an instrument of future production which it would be imprudent to lose, but because the child had certain rights—certain broad moral claims—as a human being which the parents' natural authority must not be suffered to violate or endanger, and which the State, as the supreme protector of all rights, really lay under a simple moral obligation to secure. Reforms of this character are naturally inspired by moral influences, by sentiments of justice or of humanity, by a feeling that wrong is being done to a class of the community who are placed in a situation of comparative weakness, inasmuch as they are deprived—whether through the force of circumstances or the selfish neglect of their superiors—of what public opinion recognises to be essential conditions of normal human existence. Now, most of the legislation which has led Mr. Goschen to declare that universal State action is now enthroned in England has belonged to this order. It has been guided by ethical and not by economic considerations. It has been employed mainly in readjusting rights, in establishing fresh securities for just dealing and humane living; but it has been very chary of following Continental countries in nationalizing industries. When therefore Mr. Spencer tells M. de Laveleye that the reason why England is extending the functions of her Government so much more than other nations "is obviously because there is great scope for the further extension of them here, while abroad there is little scope for the further extension of them," his explanation is singularly inappropriate. England has not been extending the functions of Government all round, but she has moved in the direction where she had less scope to move, and has stood still in the direction where she had more scope to move than other countries. And it is important to keep this distinction in mind when we hear it so often stated in too general terms that we have discarded our old belief in individual liberty and set up "universal State action" in its place.

But those who complain of England having broken off from her old moorings, not only exaggerate her leanings to authority in the present, but they also ignore her concessions to authority in the past. English statesmen and economists have never entertained the rigid aversion to Government interference that is vulgarly attributed to them, but with all their profound belief in individual liberty they have always reserved for the Government a concurrent sphere of social and economic activity—what may even be designated a specific social and economic mission. A few words may be usefully devoted to this English doctrine of social politics here, not merely because they may serve to dispel a prevailing error, but because they will furnish a good vantage-ground for seizing and judging of a principle of government which is to-day in every mouth, but unfortunately bears in every mouth a different meaning—the principle of State socialism.

It is commonly believed that the English doctrine of social politics is the doctrine of laissez-faire, and our economists are continually reviled as if they sought to leave the world to the play of self-interest and competition, unchecked by any ideas of social justice or individual human right. But in truth the doctrine of laissez-faire has never been held by any English thinker, unless, perhaps, Mr. Herbert Spencer. Mr. Spencer's first work, "Social Statics," was an exposition of the theory that the end of all government was the liberty of the individual, the realization for every citizen of the greatest amount of liberty it was possible for him to enjoy without interfering with the corresponding claims of his fellow-citizens. The individual had only one right—the right to equal freedom with everybody else, and the State had only one duty—the duty of protecting that right against violence and fraud. It could not stir beyond that task without treading on the right of some one, and therefore it ought not to stir at all. It had nothing to do with health, or religion, or morals, or education, or relief of distress, or public convenience of any sort, except to leave them sternly alone. It must, of course, renounce the thought of bounties and protective duties, but it must also give up marking plate, minting coin, and stamping butter; it must take no part in building harbours or lighthouses or roads or canals; and even a town council cannot without offence undertake to pave or clean or light the streets under its jurisdiction. It is only fair to say that Mr. Spencer refuses to be bound now by every detail of his youthful theory, but he has repeated the substance of it in his recent work, "The Man versus The State," which is written to prove that the only thing we want from the State is protection, and that the protection we want most of late is protection against our protector.

This theory is certainly about as extreme a development of individualism as could well be entertained; and though it has been even distanced in one or two points by Wilhelm von Humboldt—who objected, for example, to marriage laws[7]—no important English writer has ventured near it. The description of the State's business as the business of protecting the citizens from force and fraud, has indeed been familiar in our literature since the days of Locke, and isolated passages may be cited from the works of various political thinkers, which, if taken by themselves, would seem to deny to the State any right to act except for purposes of self-protection. John Stuart Mill himself speaks sometimes in that way, although we know, from the chapter he devotes to the subject of Government interference in his "Principles of Political Economy," that he really assigned to the State much wider functions. When we examine the writings of English economists and statesmen, and the principles they employ in the discussion of the social and industrial questions of their time, it seems truly strange how they ever came to be credited with any scruple on ground of principle to invoke the power of the State for the solution of such questions when that seemed to them likely to prove of effectual assistance.

The social doctrine which has prevailed in England for the last century is "the simple and obvious system of natural liberty" taught by Adam Smith; but the simple and obvious system of natural liberty is a very different thing from the system of laissez-faire with which it is so commonly confounded. Its main principle, it is true, is this: "Every man," says Smith, "as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man or order of men. The Sovereign is completely discharged from a duty, in the attempting to perform which he must always be exposed to innumerable delusions, and for the proper performance of which no human wisdom or knowledge could ever be sufficient: the duty of superintending the industry of private people and of directing it towards the employments most suitable to the interests of the society." ("Wealth of Nations," book iv., chap. ix.) But while the Sovereign is discharged from an industrial duty which he is incapable of performing satisfactorily, he is far from being discharged from all industrial responsibility whatsoever, for Smith immediately proceeds to map out the limits of his functions as follows: "According to the system of natural liberty, the Sovereign has only three duties to attend to—three duties of great importance, indeed, but plain and intelligible to common understandings: first, the duty of protecting the society from the violence or invasion of other independent societies; second, the duty of protecting, as far as possible, every member of the society from the injustice or oppression of every other member of it, or the duty of establishing an exact administration of justice; and thirdly, the duty of erecting and maintaining certain works and certain public institutions which it can never be for the interest of any individual or small number of individuals to erect and maintain; because the profit could never repay the expense to any individual or small number of individuals, though it may frequently do much more than repay it to a great society."

The State is required to protect us from other evils besides the evils of force and fraud—infectious diseases, for example, are in the context mentioned expressly—and to supply us with many other advantages besides the advantage of protection. Some of these advantages are of a material or economic order, and others of an intellectual or moral. The material advantages consist for the most part of provisions for facilitating the general commerce of the country—such things as roads, canals, harbours, the post, the mint—or provisions for facilitating particular branches of commerce; and among these he instances the incorporation of joint-stock companies endowed by charter with exclusive trading privileges; and the reason which, according to Smith, entitles the State to intervene in this class of cases, and which at the same time prescribes the length to which its intervention may legitimately go, is that individuals are unable to do the work satisfactorily themselves, or that the State has from its nature superior qualifications for the task. The intellectual or moral advantages which Smith asks from the State are mostly provisions for sustaining the national manhood and character, such as a system of compulsory military training or a system of compulsory—and if not gratuitous, still cheap—education; and it is important to mark that he asks for these measures, not on the ground of their political or military expediency, but on the broad ground that cowardice and ignorance are in themselves public evils, from which the State is as much bound, if it can, to save the people, as it is bound to save them from violence or fraud. Of military training he observes: "To prevent that sort of mental mutilation, deformity, and wretchedness which cowardice necessarily involves in it from spreading themselves through the great body of the people, would deserve the serious attention of Government, in the same manner as it would deserve its most serious attention to prevent a leprosy or any other loathsome and offensive disease, though neither mortal nor dangerous, from spreading itself among them, though perhaps no other public good might result from such attention besides the prevention of so great a public evil." ("Wealth of Nations," book v., chap. i.) And he proceeds to speak of education: "The same thing may be said of the gross ignorance and stupidity which in a civilized society seems so frequently to benumb the understanding of all the inferior ranks of people. A man without the proper use of the intellectual faculties of a man is, if possible, more contemptible than even a coward, and seems to be mutilated and deformed in a still more essential part of the character of human nature. Though the State was to derive no advantage from the instruction of the inferior ranks of people, it would still deserve its attention that they should not be altogether uninstructed." Compulsory military training and a system of national education would no doubt be conducive to the stricter ends of all government; the one would strengthen the defences of the nation against foreign enemies and the other would tend to the diminution of crime at home; but Smith, it will be seen, explicitly refuses to take that ground. The State's duty in the case would be the same, though no such results were to follow, for the State has other duties to perform besides the maintenance of peace and the repression of crime. It would probably be admitted, he thinks, that it was as incumbent on the State to take steps to arrest the progress of a "mortal and dangerous" disease as it was to stop a foreign invasion; but he goes further, and contends that it was equally incumbent on the State to arrest the progress of a merely "loathsome and offensive" disease, for the simple reason that such a disease was a mutilation or deformity of our physical manhood. And just as the State ought to prevent the mutilation and deformity of our physical manhood, so the State ought to prevent the mutilation and deformity of our moral and intellectual manhood, and was bound accordingly to provide a system of military training and a system of popular education, to prevent people growing up ignorant and cowardly, because the ignorant man and the coward were men without the proper use of the faculties of a man, and were mutilated and deformed in essential parts of the character of human nature. At bottom Smith's principle is this—that men have an original claim—a claim as original as the claim to safety of life and property—to all the essential conditions of an unmutilated and undeformed manhood, and that is really only another expression for the principle that lies at the foundation of all civil and human right, that men have a right to the essential conditions of a normal humanity, to the presuppositions of all humane living, to the indispensable securities for the proper realization of our common vocation as human beings. The right to personal liberty—to the power of working for ends of our own prescribing, and the right to property—to the power of retaining what we have made, to be the instrument of further activities for the ends we have prescribed for ourselves—rest really on no other ground than that the privileges claimed are essential conditions of a normal, an unmutilated and undeformed manhood, and it is on this broad ground that Adam Smith justifies the State's intervention to stop disease and supply education.

Smith held but a poor opinion of the capacities of Government management, and especially of English Government management, which, he asserted, was characterized in times of peace by "the slothful and negligent profusion that was natural to monarchies," and in times of war by "all the thoughtless extravagance" that was peculiar to democracies; but nevertheless he had no hesitation in asking Government to undertake a considerable number of industrial enterprises, because he believed that these were enterprises which Government with all its faults was better fitted to conduct successfully than private adventurers were. On the other hand, Smith entertained the highest possible belief in individual liberty, but he had never any scruple about sacrificing liberty of contract where the sacrifice was demanded by the great moral end of Government—the maintenance of just and humane dealing between man and man. For example, the suppression of the truck system, which is sometimes condemned as an undue interference with freedom of contract, was strongly supported by Smith, who declared it to be "quite just and equitable," inasmuch as it merely secured to the workmen the pay they were entitled to receive and "imposed no real hardship on the masters—it only obliged them to pay that value in money which they pretended to pay, but did not really pay, in goods." It was only a just and necessary protection of the weaker party to a contract against an oppressive exaction to which, like the apothecary in "Romeo and Juliet," his poverty might have consented, but not his will. Precisely analogous is Smith's position concerning usury laws. Usury laws are seldom defended now; for one thing, money has become so abundant that the competition of lender with lender may be trusted to as a better security for fair and reasonable treatment of borrowers than a Government enactment could provide. But Smith in his day was strongly in favour of fixing a legal rate of interest, because he thought it was necessary to prevent the practice of extortion by unscrupulous dealers on necessitous clients. His views on truck and usury show that he had no sympathy with those who contend that the State must on no account interfere with grown-up people in the bargains they may make, inasmuch as grown-up people may be expected to be quite capable of looking effectively after their own interest. Smith recognised that grown-up people were often in natural circumstances where it was practically impossible for them to assert effectively not their interests merely, but even their essential claims as fellow-citizens; and that therefore it was the State's duty to come to the aid of those whose own economic position was weak, and to force upon the strong certain responsibilities—or at least secure for the weak certain broad, positive conditions—which just and humane dealing might demand.

Now, in these ideas about truck and usury, as in the proposals previously touched upon for checking the growth of disease or cowardice or ignorance, is not the principle of social politics that is applied by Smith precisely the principle that runs through our whole recent social legislation—factory, sanitary, and educational—the principle of the State's obligation to secure the people in the essential conditions of all normal manhood? German writers often take Smith for an exponent, if not for the founder, of what they call the Rechtstaat theory—the theory that the State is mainly the protector of right; but in reality Smith's doctrine corresponded pretty closely with their own Kultur-und-Wohlfahrtstaat theory—the theory that the State is a promoter of culture and welfare; and if further proof were wanted, it might be found in the fact that in his doctrine of taxation he departs altogether from the economic principle, which is popularly associated with the Rechtstaat idea, and is supposed to be a corollary of it, that a tax is a quid pro quo, a price paid for a service rendered, and ought therefore to be imposed on individuals in proportion to the service they respectively receive from the State; and instead of this economic principle he lays down the broad ethical one, that a tax is a public obligation which individuals ought to be called upon to discharge in proportion to their respective abilities. The rich cannot fairly be said to get more good from the State than the poor; they probably get less, because they are better capable of providing for their own defence; but the rich are able to do more good to the State than the poor, and because they are able, they are bound.

Such is the social doctrine of Adam Smith, and it is manifestly no doctrine of rigid individualism, calling out for freedom at any price, or banning all interference with the natural play of self-interest and competition. The natural liberty for which the great English economist contended was not the mere ghost of liberty worshipped by Mr. Spencer. An ignorant man might be free, as an imprisoned man was free, within limits, but he was not free within normal human limits. He had not the use of his mind; he was wanting in an essential part of his manhood. First make him a man—a whole, complete, competent man, fit for man's vocation—then make him free. There is a common metaphysical distinction between the formal freedom of the will and the material freedom of the will. The drunkard, the lunatic, is formally free, for he exerts his choice, but he is materially enslaved. The difference between liberty according to Mr. Spencer and liberty according to Adam Smith is something analogous. The liberty Smith desires is a substantial liberty; it is clothed with a body—a definite body of universal human rights—which the State is bound to realize as it would realize liberty itself. The reason of his difference from the laissez-faire theory of Mr. Spencer, which is so often erroneously attributed to him, is that he takes a much broader and more practical view of the original moral rights of individuals than such ultra-individualists are accustomed to do. While they hold that the State is there only to secure to individuals reality and equality of freedom, he holds it is there to secure them reality and equality of all moral rights. He would supply all alike, therefore, with certain material securities—the material conditions necessary to secure their moral rights with equal completeness,—and he would protect them in the enjoyment of those conditions against the assaults of poverty and misfortune no less than the assaults of murderers and thieves. But beyond this line he would refuse to go; if he stands clearly out in advance of the laissez-faire position of equality of legal freedom, he stands equally clearly far short of the socialistic position of equality of material conditions.

Now this doctrine of the great founder of English political economy has been substantially the doctrine of his successors as well. It would be beyond my present scope to trace the history of the doctrine of social politics through the writings of the whole succession of English economists, nor is it necessary. I shall choose a representative economist from the group who are generally reckoned the most narrow and unsympathetic, who are accused of having shifted political economy off the broader lines on which it had been launched by Smith, who are counted the great idolaters of self-interest and natural law, and the scientific associates of the much-abused Manchester school—viz., the disciples of Ricardo. Ricardo himself touches only incidentally on the functions of the State, but he then does so to defend interventions, such as minting money, marking plate, testing drugs, examining medical candidates, and the like, which are meant to guard people against deceptions they are themselves incompetent to detect. Moreover, he was a strong advocate for at least one important extension of the State's industrial rôle—he would establish a National Bank of issue with exclusive privileges; and it is not uninteresting to remember that in his place in Parliament he brought forward the suggestion of a system of Government annuities for the accommodation of working men, which was introduced by Mr. Gladstone half a century later, and has been denounced in certain quarters as that statesman's first step in socialism, and that he was one of a very small minority who voted for a Parliamentary inquiry into the social system of Robert Owen.

But if Ricardo is comparatively silent on the subject, we fortunately possess a very ample discussion of it by one of his leading disciples, J. E. McCulloch. When Ricardo died, James Mill wrote to McCulloch, "As you and I are his two and only genuine disciples, his memory must be a point of connection between us;" and it was on McCulloch that the mantle of the master descended. His "Principles of Political Economy," which may be said to be an exposition of the system of economics according to Ricardo, was for many years the principal textbook of the science, and will still be admitted to be the best and most complete statement of what, in the cant of the present day, is called orthodox political economy. McCulloch, indeed, is more than merely the expositor of that system; he is really one of its founders, the author of one of its most famous dogmas, at least in its current form, the now exploded doctrine of the Wages fund; and of all the adherents of this orthodox tradition, McCulloch is commonly considered the hardest and most narrow. There are economists who are supposed to show a native generous warmth which all the severities of their science are unable to quell. John Stuart Mill is known to have come under St. Simonian influences in his younger days, and to have been fond ever afterwards of calling himself a socialist; and Professor Sidgwick, in our own day, is often credited—and not unjustly—with a like breadth of heart, and in publishing his views of Government interference, he gives them the name of "Economic Socialism." But in selecting McCulloch, I select an economist the rigour of whose principles has never been suspected, and yet so striking is the uniformity of the English tradition on this subject, that in reality neither Mill nor Mr. Sidgwick professes a broader doctrine of social politics, or goes a step further, or more heartily on the road to socialism than that accredited champion of individualism, John Ramsay McCulloch.

McCulloch's "Principles" contains—from the second edition in 1830 onward to the last author's edition in 1849—a special chapter on the limits of Government interference; and the chapter starts with an explicit repudiation of the doctrine of laissez-faire, which was then apparently only beginning to come into vogue in England.

"An idea," says McCulloch, "seems however to have been recently gaining ground that the duty of the Government with regard to the domestic policy of the country is almost entirely of a negative kind, and that it has merely to maintain the security of property and the freedom of industry. But its duty is by no means so simple and easily defined as those who support this opinion would have us to believe. It is certainly true that its interference with the pursuits of individuals has been, in very many instances, exerted in a wrong direction, and carried to a ruinous excess. Still, however, it is easy to see that we should fall into a very great error if we supposed that it might be entirely dispensed with. Freedom is not, as some appear to think, the end of government; the advancement of the public prosperity and happiness is its end; and freedom is valuable in so far only as it contributes to bring it about. In laying it down, for example, that individuals should be permitted, without let or hindrance, to engage in any business or profession they may prefer, the condition that it is not injurious to others is always understood. No one doubts the propriety of a Government interfering to suppress what is or might otherwise become a public nuisance; nor does any one doubt that it may advantageously interfere to give facilities to commerce by negotiating treaties with foreign powers, and by removing such obstacles as cannot be removed by individuals. But the interference of Government cannot be limited to cases of this sort. However disinclined, it is obliged to interfere in an infinite variety of ways and for an infinite variety of purposes. It must, to notice only one or two of the classes of objects requiring its interference, decide as to the species of contract to which it will lend its sanction, and the means to be adopted to enforce true performance; it must decide in regard to the distribution of the property of those who die intestate, and the effect to be given to the directions in wills and testaments; and it must frequently engage itself, or authorize individuals or associations to engage, in various sorts of undertakings deeply affecting the rights and interests of others and of society. The furnishing of elementary instruction in the ordinary branches of education for all classes of persons and the establishment of a compulsory provision for the support of the destitute poor are generally also included, and apparently with the greatest propriety, among the duties incumbent on administration" (p. 262).

He allows State ownership and State management of industrial works, wherever State ownership and management are more efficient for the purpose than private enterprise—in other words, where they are more economical—as in the cases of the coinage, roads, harbours, postal communication, etc. He would expropriate land for railway purposes, grant a monopoly to the railway company, and then subject it to Government control in the public interest; he would impose many sorts of restrictions on freedom of contract, freedom of industry, freedom of trade, freedom of property, and freedom of bequest; and, what is more important, he recognises clearly that with the growth of society fresh interferences of a serious character will be constantly called for, which may in some cases involve the application of entirely new principles, or throw on the Government work of an entirely new character.

For example, he is profoundly impressed with the dangers of the manufacturing system, which he saw growing and multiplying all around him, and so far from dreaming that the course of industry should remain uncontrolled, he even ventures, in a remarkable passage, to express the doubt whether it may not "in the end be found that it was unwise to allow the manufacturing system to gain so great an ascendancy as it has done in this country, and that measures should have been early adopted to check and moderate its growth" (p. 191). He admits that a decisive answer to this question could only be given by the economists of a future generation, after a longer experience of the system than was possible when he wrote, but he cannot conceal the gravest apprehension at the preponderance which manufactures were rapidly gaining in our industrial economy. And his reasons are worthy of attention. The first is the destruction of the old moral ties that knit masters and men together.

"But we doubt whether any country, how wealthy soever, should be looked upon as in a healthy, sound state, where the leading interest consists of a small number of great capitalists, and of vast numbers of workpeople in their employment, but unconnected with them by any ties of gratitude, sympathy, or affection. This estrangement is occasioned by the great scale on which labour is now carried on in most businesses; and by the consequent impossibility of the masters becoming acquainted, even if they desired it, with the great bulk of their workpeople.... The kindlier feelings have no share in an intercourse of this sort; speaking generally, everything is regulated on both sides by the narrowest and most selfish views and considerations; a man and a machine being treated with about the same sympathy and regard" (p. 193).

The second reason is the suppression of the facilities of advancement enjoyed by labourers under the previous régime. "Owing to the greater scale on which employments are now mostly carried on, workmen have less chance than formerly of advancing themselves or their families to any higher situation, or of exchanging the character of labourers for that of masters" (p. 188). For the majority of the working-class to be thus, as he expresses it, "condemned as it were to perpetual helotism," is not conducive to the health of a nation. The third reason is the comparative instability of manufacturing business. It becomes a matter of the most serious concern for a State, "when a very large proportion of the population has been, through their agency, rendered dependent on foreign demand, and on the caprices and mutations of fashion" (p. 192). That also is a state of things fraught with danger to the health of a community. McCulloch always treats political economy as if he defined it—and the definition would be better than his own—as the science of the working of industrial society in health and disease; and he always throws on the State a considerable responsibility in the business of social hygiene; going so far, we have seen in the passages just quoted, as to suggest whether a legal check ought not to have been imposed on the free growth of the factory system, on account of its bad effects on the economic position of the labouring class. We had suffered the system to advance too far to impose that check now, but there were other measures which, in his opinion, the Legislature might judiciously take in the same interest. It is of course impossible, by Act of Parliament, to infuse higher views of duty or warmer feelings of ordinary human regard into the relations between manufacturers and their workmen; but the State might, according to McCulloch, do something to mitigate the modern plague of commercial crises, by a policy of free trade, by adopting a sound monetary system, by securing a continuance of peace, and by "such a scheme of public charity as might fully relieve the distresses without insulting the feelings or lessening the industry of the labouring classes" (p. 192).

As with commercial crises, so with other features of the modern industrial system; wherever they tend to the deterioration of the labouring class, McCulloch always holds the State bound to intervene, if it can, to prevent such a result. He would stop the immigration of what is sometimes called pauper labour—of bodies of workpeople brought up in an inferior standard of life—because their example and their competition tend to pull down the native population to their own level. The example he chooses is not the Jewish element in the East End of London, but the much more important case of the Irish immigration into Liverpool and Glasgow; and while he would prefer to see Government taking steps to improve the Irish people in Ireland itself, he declares that, if that is not practicable, then "justice to our own people requires that measures should be adopted to hinder Great Britain from being overrun with the outpourings of this officina pauperum, to hinder Ireland from dragging us down to the same hopeless abyss of pauperism and wretchedness in which she is sunk" (p. 422). This policy may be wise, or it may not, but it shows very plainly—what appears so often in his writings—how deeply McCulloch's mind was penetrated with the conviction that one of the greatest of all the dangers from which the State ought to do what it well can to preserve the people, was the danger of falling to a lower standard of tastes and requirements, and thereby losing ambition and industry, and the very possibility of rising again.

"This lowering of the opinions of the labouring class with respect to the mode in which they should live is perhaps the most serious of all the evils that can befall them.... The example of such individuals or bodies of individuals as submit quietly to have their wages reduced, and who are content if they get only mere necessaries, should never be held up for public imitation. On the contrary, everything should be done to make such apathy be esteemed discreditable. The best interests of society require that the rate of wages should be elevated as high as possible—that a taste for comforts and enjoyments should be widely diffused, and, if possible, interwoven with national habits and prejudices. Very low wages, by rendering it impossible for increased exertions to obtain any considerable increase of advantages, effectually hinder them from being made, and are of all others the most powerful cause of that idleness and apathy that contents itself with what can barely continue animal existence" (p. 415).

And he goes on to refute the idea of Benjamin Franklin, that high wages breed indolent and dissipated habits, and to contend that they not only improve the character and efficiency of the labourer, but are in the end a source of gain, instead of loss, to the employer. But, although the maintenance of a high rate of wages is so great an object of public solicitude, it was an object which it was, in McCulloch's judgment, outside the State's province, simply because it was outside its power, to do anything directly to promote, because while authority could fix a price for labour, it could never compel employers to engage labour at that price; and consequently its interference in such a way would only end in injury to the class it sought to befriend, as well as to the trade of the country in general. Still, McCulloch is far from wishing to repel the State's offices or the offices of public opinion in connection with the business altogether. In the passage just quoted he expressly makes an appeal to public opinion for an active interference in a direction where, he believes, its interference might be useful; and as for the action of the State, he approves, for one thing, of the legalization of trades unions, and, for another, of the special instruction of the public, at the national expense, in the principles on which a high rate of wages depend.

In regard to the Factory Acts, while he would have the hours of labour in the case of grown-up men settled by the parties themselves, because he thought them the only persons competent to settle them satisfactorily, he strongly supported the interference of the Legislature, on grounds of ordinary humanity, to limit the working day of children and women, because "the former are naturally, and the latter have been rendered, through custom and the institutions of society, unable to protect themselves" (p. 426); and he seconded all Lord Shaftesbury's labours down to the Ten Hours Act of 1847, to which he objected on the ground that it involved a practical interference with all adult factory labour. On the other hand, he was in favour of the principle of employers' liability for accidents in mines and workshops, because there seemed no other way of saving the labourers from their own carelessness, except by making the masters responsible for the enforcement of the necessary regulations (p. 307).

But McCulloch's general position on this class of questions is still better exemplified in the view he takes of the State's duty on a matter of great present interest, the housing of the poor. Here he has no hesitation in throwing the principal blame for the bad accommodation of the working-classes of that day, for the underground cellar dwellings of Liverpool and Manchester, the overcrowded lodging-houses of London, and the streets of cottages unsupplied with water or drainage, on "the culpable inattention of the authorities." Mr. Goschen vindicates the legitimacy of Government interference with the housing of the people, on the ground that it is the business of Government to see justice done between man and man. When a man hired a house, Government had a right to see that he got a house, and a house meant a dwelling fit for human habitation. The inspection of houses is, according to this idea, only a case of necessary protection against fraud, like the institution of medical examinations, the assaying of metals, or the testing of drugs; and protection against fraud is admitted everywhere to be the proper business of Government. McCulloch bases his justification of the intervention on much broader grounds. Government needs no other warrant for condemning a house that is unfit for human habitation but the simple fact that the house is unfit for human habitation, and it makes no difference whether the tenant is cheated into taking the bad house, or takes it openly because he prefers it. In fact, the strongest reason, in McCulloch's opinion, for invoking Government interference in the case at all, is precisely the circumstance that so many people actually prefer unwholesome houses from motives of economy.

"Such cottages," he says, "being cheap, are always sure to find occupiers. Nothing, however, can be more obvious than that it is the duty of Government to take measures for the prevention and repair of an abuse of this sort. Its injurious influence is not confined to the occupiers of the houses referred to, though if it were, that would be no good reason for declining to introduce a better system. But the diseases engendered in these unhealthy abodes frequently extend their ravages through all classes of the community, so that the best interests of the middle and higher orders, as well as of the lowest, are involved in this question. And, on the same principle that we adopt measures to guard against the plague, we should endeavour to secure ourselves against typhus, and against the brutalizing influence, over any considerable portion of the population, of a residence amid filth and disease" (p. 308).

The last clause is remarkable. The State is required to protect the people from degrading influences, to prevent them from being brutalized through the avarice or apathy of others, and to prevent them being brutalized through the avarice or apathy of themselves. It is not what many persons would expect, but here we have political economy, and the most "orthodox" political economy, forcing people to go to a dearer market for their houses, in order to satisfy a sentiment of humanity, and imposing on the State a social mission of a broad positive character—the mission of extirpating brutalizing influences. Yet, expected or not, this is really the ordinary tradition of English economists—it is the principle laid down by Smith of obliging the State to secure for the people an unmutilated and undeformed manhood, to provide for them by public means the fundamental conditions of a humane existence.

McCulloch's position comes out more clearly still in the reasons he gives for advocating a compulsory provision for the able-bodied poor, and a national system of popular education. With regard to the impotent poor, he is content with saying that it would be inhumanity to deny them support, and injustice to throw their support exclusively on the benevolent. A poor-rate is sometimes defended on what are professed to be strictly economical grounds, by showing that it is both less mischievous and less expensive than mendicity; but what strikes McCulloch is not so much the wastefulness of private charity in the hands of the benevolent as the injustice of suffering the avaricious to escape their natural obligations. Few, however, have much difficulty in finding one good reason or another for making a public provision for the impotent poor; the crux of the question of public assistance is the case of the able-bodied poor. A provision for the able-bodied poor is practically a recognition in a particular form of "the right to labour," and the right to labour resounds with many revolutionary terrors in our English ears, although it has, as a matter of fact, been practised quietly, and most of the time in one of its most pernicious forms, in every parish of England for nearly three hundred years.

Now on this question McCulloch was a convert. He confessed to the Committee on the State of the Poor in Ireland, in 1830, that he had changed his views on the subject entirely since his previous evidence in 1825. He had formerly been, he said, "too much imbued with mere theory, with the opinions of Malthus and Townsend"; but he had become a firm believer in the necessity and the public advantage of a legal provision for the able-bodied poor, and he strongly recommended the introduction of such a system into Ireland, in the first instance as an instrument of individual relief, but also as an effectual engine of social improvement. He gives the reasons for his conversion partly in his evidence, and partly in a more systematic form in his "Principles of Political Economy." First, Malthus had attributed to the Poor Law itself effects which really sprang from certain bad arrangements that had been engrafted on the English system of relief, but were not essential to it—viz., the allowance system, and the law known as Gilbert's Act, which deprived parishes of the right to refuse relief except in workhouses, and forced them to provide work for paupers, if paupers desired it, at or near their own houses. These two arrangements, in McCulloch's opinion, converted the English provision for the able-bodied poor from what we may term a wise and conditional right of labour into an unwise and dangerous one. In the second place, he had come to see that a legal provision for the poor, instead of having, as was alleged, a necessary tendency to multiply pauperism, had in reality a natural tendency to prevent its growth, because it gave the landlords and influential ratepayers a strong pecuniary as well as moral interest in producing that result. Its effect was thus to establish in every parish a new local stimulus to social improvement, and it was on account of this effect of a Poor Law that McCulloch thought it would be specially beneficial to Ireland, because there was nothing Ireland needed more than just such a local stimulus. In the third place, he had become more and more profoundly impressed with the increasing gravity of the vicissitudes and fluctuations of employment to which English labourers were subject since England became mainly a manufacturing country, and that unhappy feature of manufacturing industry was his principal reason for invoking legislative assistance. A purely agricultural country, he thought, might be able to do without a Poor Law, because agricultural employment was comparatively steady; but in a manufacturing country a Poor Law was indispensable, on account of the long periods of depression or privation which were normal incidents in the life of labour in such a country, and on account of the pernicious effect which these periods of privation would, if unchecked, be certain to exercise upon the character and habits of the labouring classes, through "lowering their estimate of what is required for their comfortable and decent subsistence." ("Political Economy," p. 448.)

"During these periods of extraordinary privation the labourer, if not effectually relieved, would imperceptibly lose that taste for order, decency, and cleanliness which had been gradually formed and accumulated in better times by the insensible operation of habit and example, and no strength of argument, no force of authority, could again instil into the minds of a new generation, growing up under more prosperous circumstances, the sentiments and tastes thus uprooted and destroyed by the cold breath of penury. Every return of temporary distress would therefore vitiate the feelings and lower the sensibilities of the labouring classes" (p. 449).

McCulloch quotes these words from Barton, but he quotes them to express his own view, and their teaching is very explicit on the duty of Government to the unemployed in seasons of commercial distress. In such seasons of "extraordinary privation" the State is called upon to take "effectual" measures—extraordinary measures, we may infer, if extraordinary measures were necessary—for the relief of the unemployed, not merely to save them from starvation, but to prevent them from losing established habits of "order, decency, and cleanliness"; from getting their feelings vitiated, their sensibilities impaired, so that they were in danger of remaining content with a worse standard of living, and sinking to a lower scale in the dignity of social and civilized being. In a word, it is held to be the duty of the State to prevent, if it can, the temporary reverses of the labouring class from resulting in its permanent moral decadence; and as the object of the State's intervention is to preserve the dignity, the self-respect, the moral independence and energy of the labouring class, the manner of the intervention, the choice of actual means and steps for administering the relief, must, of course, be governed by the same considerations. "The true secret of assisting the poor," says McCulloch, borrowing the words of Archbishop Sumner, "is to make them agents in bettering their own condition, and to supply them, not with a temporary stimulus, but with a permanent energy" (p. 475).

The same principles come out even more strongly in McCulloch's remarks on national education. He says, "the providing of elementary instruction for all classes is one of the most pressing duties of Government" (p. 473); and the elementary instruction he would provide would not stop at reading and writing, but would include even a knowledge of so much political economy as would explain "the circumstances which elevate and depress the rate of wages" (p. 474). It was the duty of Government to extirpate ignorance, because, "of all obstacles to improvement, ignorance was the most formidable"; and it was its duty to establish Government schools for the purpose, because charity schools impaired the self-respect and sense of independence which were themselves first essentials of all social improvement.

"No extension of the system of charity and subscription schools can ever fully compensate for the want of a statutory provision for the education of the public. Something of degradation always attaches to the fact of one's having been brought up in a charity school. The parents who send children to such an institution, and even the children, know that they have been received only because they are paupers unable to pay for their education; and this consciousness has a tendency to weaken that state of independence and self-respect, for the want of which the best education may be but an imperfect substitute. But no such feeling could operate on the pupils of schools established by the State" (p. 476).

There is no question with McCulloch about the right of the State to take steps to forward the moral progress, or to prevent the moral decadence, of the community—or any part of the community—under its care; that is simply its plain and primary duty, though there may be question with the State, as with other agencies, whether particular measures proposed for the purpose are really calculated to effect it.

After this long, and I fear tedious, account of the opinions of McCulloch, it would be needless to call more witnesses to refute those who so commonly accuse English economists of teaching an extreme individualism. For McCulloch may be said to be their own witness; they hold him up as the hardest and narrowest of a hard and narrow school; one of the ablest of them, Mr. J. K. Ingram, who writes McCulloch's memoir in the Encyclopædia Britannica, going so far as to accuse him of exhibiting "a habitual deadness in the study of social questions to all but material considerations." We have adduced enough to disprove that statement. The reader of McCulloch's writings is constantly struck to observe how habitually his judgment of a social question is governed by ethical rather than economic considerations, and how his supreme concern always seems to be to guard the labouring poor from falling into any sort of permanent decadence, and to place them securely on the lines of progressive elevation. But perhaps a word may be required about the Manchester school. Mr. Ingram states—and again his statement probably agrees with current prepossessions—that McCulloch occupied "substantially the same theoretic position as was occupied at a somewhat later period by the Manchester school" (Encyc. Brit., art. "Political Economy"). We have seen what McCulloch's theoretic position really was, and it is certainly not the Manchester doctrine of popular anathema; it is not the Manchesterismus of the German schools. But the Manchester men can scarcely be said to have properly had anything in the nature of a general theoretic position. They were not a school of political philosophy—they were a band of practical politicians leagued to promote particular reforms, especially two reforms in international policy which involved large curtailments of the rôle of Government—viz., free trade with other countries, and nonintervention in their internal affairs; but they were far from thinking that, because it would be well for the State to abstain from certain specific interferences, it would be well for it to abstain from all; or that if the State had no civilizing mission towards the people of other countries, it had therefore no civilizing mission towards its own. Cobden, for example—to go no farther—was a lifelong advocate of a national system of education; he was a friend of factory legislation for women and children, and, with respect to the poor, he taught in one of his speeches the semi-socialistic doctrine that the poor had the first right to maintenance from the land—that they are, as it were, the first mortgagees. The Manchester school is really nothing but a stage convention, a convenient polemical device for marking off a particular theoretical extreme regarding the task of the State; but the persons in actual life who were presumed to compose the school were no more, all of them, adherents of that theory than Scotchmen, off the stage, have all short kilts and red hair. And as for that theory itself, the theory of laissez-faire, it has never in England been really anything more than it is now, the plea of alarmed vested interests stealing an unwarranted, and I believe an unwelcome, shelter under the ægis of economic science. English economists, from Smith to McCulloch, from McCulloch to Mr. Sidgwick, have adhered with a truly remarkable steadiness to a social doctrine of a precisely contrary character—a social doctrine which, instead of exhibiting any unreasonable aversion to Government interference, expressly assigns to Government a just and proper place in promoting the social and industrial development of the community. In the first place, in the department of production, they freely allow that just as there are many industrial enterprises in the conduct of which individual initiative must, for want of resources or other reasons, yield to joint-stock companies, so there are others for which individuals and companies alike must give place to the State, because the State is by nature or circumstances better fitted than either to conduct them satisfactorily; and in the next place, in the department of distribution, while rating the moral or personal independence of the individual as a supreme blessing and claim, they have no scruple in calling on the State to interfere with the natural liberty of contract between man and man, wherever such interference seems requisite to secure just and equitable dealing, to guard that personal independence itself from being sapped, or to establish the people better in any of the other elementary conditions of all humane living. We sometimes take pride at the present day in professing a distrust for doctrinaire or metaphysical politics, and we are no doubt right; but that reproach cannot justly be levelled against the English economists. They were not Dutch gardeners trying to dress the world after an artificial scheme; that is more distinctive of the social systems they opposed. Their own system indeed was to study Nature, to discover the principles of sound natural social growth, and to follow them; but they had no idea on that account of leaving things to grow merely as they would, or of renouncing the help of good husbandry. They had, as we have seen, a positive doctrine of social politics, which required from the State much more than the protection of liberty and the repression of crime; they asked the State to undertake such industrial work as it was naturally better fitted to perform than individuals or associations of individuals, and they asked the State to secure to the body of the citizens the essential conditions of a normal and progressive manhood.

Now this doctrine—which may be called the English doctrine of social politics—seems to furnish a basis of considerable practical value for discriminating between a wholesome and effective participation by Government in the work of social reform, on the one hand, and those pernicious and dangerous forms of intervention on the other, which may be correctly known by the name of State socialism.

 

II. The Nature and Principle of State Socialism.

Few words are at present more wantonly abused than the words socialism and State socialism. They are tossed about at random, as if their meaning, as was said of the spelling of former generations, was a mere affair of private judgment. There is, in truth, a great deal of socialism in the employment of the word; little respect is paid to the previous appropriation of it; and especially since it has become, as has been said, hoffähig, men press forward from the most unlikely quarters, claim kindred with the socialists, and strive for the honour of being called by their name. Many excellent persons, for example, have no better pretext to advance for their claim than that they also feel a warm sentiment of interest in the cause of the poor. Churchmen whose duties bring them among the poor are very naturally touched with a sense of the miseries they observe, and certain of them, who may perhaps without offence be said to love the cause well more than wisely, come to public platforms and declare themselves socialists—socialists, they will sometimes explain, of an older and purer confession than the Social Democratic Federation, but still good and genuine socialists—merely because the religion they preach is a gospel of moral equality before God, and of fraternal responsibility among men, whose very test in the end is the test of human kindness—"Inasmuch as ye did it not to one of the least of these My brethren, ye did it not to Me." But socialism is not a feeling for the poor, nor yet for the responsibilities of society in connection with their poverty; it is neither what is called humanitarianism, nor what is called altruism; it is not an affair of feeling at all, but of organization, and the feeling it breathes may not be altruistic. The revolutionary socialists of the Continent, for instance, are animated by as vigorous a spirit of self-interest and an even more bitter class antagonism than a trade union or a land league. They fight for a particular claim of right—the utterly unjustifiable claim to the whole product of labour—and they propose to turn the world upside down by a vast scheme of social reconstruction in order to get their unjust, delusive, and mischievous idea realized. The gauge of their socialism, therefore, must, after all, be looked for in their claim and their remedy, and not in the vague sympathies of a benevolent spectator who, without scrutinizing either the one or the other, thinks he will call himself a socialist because he feels that there is much in the lot of the poor man that might be mended, and that the rich might be very properly and reasonably asked to make some sacrifices for their brethren's sake out of their abundance. The philanthropic spectator suffers from no scarcity of words to express his particular attitude if he desires to do so; why then should he not leave socialists the enjoyment of their vocable?

There is often at the bottom of this sentimental patronage of socialism the not unchivalrous but mistaken idea that the ordinary self-interest of the world has been glorified by economists into a sacred and all-sufficing principle which it would be interfering with the designs of Providence to restrict, and that therefore it is only right to side with socialism as a protest against the position taken by the apologists of the present system of things, without being understood to commit one's self thereby to the particular system which socialism may propose to put in its place. But while the economists think very rightly that self-interest must always be regarded as the ordinary guide of life, and that the world cannot be reasonably expected to become either better, or better off, if everybody were to look after other people's interests (which he knows nothing about) instead of looking after his own (of which he at least knows something), they are far from showing any indifference to the danger of self-interest running into selfishness. On the contrary, they have constantly insisted—as the evidence I have already produced abundantly proves—that where the self-interest of the strongly placed failed to subject itself spontaneously to the restraints of social justice and the responsibilities of our common humanity, it was for society to step in and impose the restraints that were just and requisite, and to do so either by public opinion or by public authority in the way most likely to be practicable and effectual. Another thing our sentimental friends forget is that the socialists of the present day have no thought of substituting any other general economic motive in the room of self-interest. If they had their schemes realized to-morrow, men would still be paid according to the amount of their individual work, and each would work so far for his own hand. His daily motive would be his individual interest, though his scope of achievement would be severely limited by law with the view of securing a better general level of happiness in the community. The question between economists and socialists is not whether the claims of social justice are entitled to be respected, but whether the claims which one or other of them make really are claims of social justice or no. Still, so firm is the hold taken by the notion that the socialists are the special champions of social justice, that one of our most respected prelates has actually defined socialism in that sense. The Bishop of Rochester (now of Winchester), in his Pastoral Letter to his Clergy at the new year of 1888, takes occasion, while warning the younger brethren against the too headlong philanthropy which "scouts what is known as the science of political economy," to describe socialism as "the science of maintaining the right proportion of equity and kindness while adjudicating the various claims which individuals and society mutually make upon each other." In reality, socialism would be better defined as a system that outsteps the right proportion of equity and kindness, and sets up for the masses claims that are devoid of proportion and measure of any kind, and whose injustice and peril often arise from that very circumstance.

If bishops carry the term off to one quarter, philosophers carry it to another. Some identify socialism with the associative principle generally, and see it manifested in the growth of one form of organization as much as in the growth of another, or at most they may limit it to the intervention of the associative principle in things industrial, and in that event they would consider a joint-stock company, or a co-operative store, or perhaps a building like Queen Anne's Mansions, or the common-stair system of Scotland, to be as genuine exhibitions of socialism as the collectivism or anarchism of the Continental factions or the State monopolies of Prince Bismarck. But a joint-stock company is no departure from—it is rather an extension of—the present régime of private property, free competition, and self-interest; and why should it be described by the same name as a system whose chief pretension is to supersede that régime by a better? Another very common definition of socialism—perhaps the most common of all, and the last to which I shall refer here—is that socialism is the general principle of giving society the greatest possible control over the life of the individual, in contradistinction to the opposite principle of individualism, which is taken to be the principle of giving the individual the greatest possible immunity from the control of society. Any extension of the authority of the State, any fresh regulation of the transactions of individual citizens, is often pronounced to be socialistic without asking what the object or nature of the regulations may be. Socialism is identified with any enlargement, and individualism with any contraction, of the functions of government. But the world has not been made on this socialist principle alone, nor on this individualist principle alone, and it can neither be explained nor amended by means of the one without the other. Abstractions of that order afford us little practical guidance. The socialists of real life are not men who are bent on increasing Government control for the mere sake of increasing Government control. There are broad tracts of the individual's life they would leave free from social control; they would give him, for example, full property in his house and furniture during his lifetime, and the right to spend his income, once he had earned it, in his own way. Their scheme, if carried out, might be found to compel them to restrict this latter right, but their own desire and belief undoubtedly is that the individual would have more freedom of the kind then than he has now. They seek to extend Government control only because, and only so far as, they believe Government control to be necessary and fitted to realize certain theories of right and well-being which they think it incumbent on organized society to realize; and consequently the thing that properly characterizes their position is not so much the degree of their confidence in the powers of the State as the nature of the theories of right for which they invoke its intervention. And just as socialists do not enlarge the bounds of authority from the mere love of authority, so their opponents do not resist the enlargement from the mere hatred of authority. They raise no controversy about the abstract legitimacy of Government encroachments on the sphere of private capital or of legal enlargements of the rights or privileges of labour. There is no socialism in that; the socialism only comes in when the encroachments are made on a field where Government administration is unlikely to answer, and where the rights conferred are rights to which labour can present no just and reasonable claim.

It will be objected that this is to reduce socialism to a mere matter of more or less. The English economists, it will be said, practised a little socialism, because they allowed the use of State means to elevate the condition of the working classes, or to provide for the wants of the general community; and the Continental Social Democrats only practise a little more socialism when they cry for a working-class State or for the progressive nationalization of all industries. But in practical life the measure is everything. So many grains of opium will cure; so many more will kill. The important thing for adjusting claims must always be to get the right measure, and the objection to socialistic schemes is precisely this, that they take up a theory of distributive justice which is an absolutely wrong measure, or else some vague theory of disinheritance which contains no measure at all. They would nationalize industries without paying any respect to their suitability for Government management, simply because they want to see all industries nationalized; and they would grant all manner of compensating advantages to the working class as instalments of some vague claim, either of economic right from which they are alleged to have been ousted by the system of capitalism, or of aboriginal natural right from which they are said to have been disinherited by the general arrangements of society itself. What distinguishes their position and makes it socialism is therefore precisely this absence of measure or of the right measure, and one great advantage of the English doctrine of social politics which I have expounded, is that it is able to supply this indispensable criterion. That doctrine would limit the industrial undertakings of the State to such as it possessed natural advantages for conducting successfully, and the State's part in social reform to securing for the people the essential conditions of all humane living, of all normal and progressive manhood. It would interfere, indeed, as little as possible with liberty of speculation, because it recognises that the best way of promoting social progress and prosperity is to multiply the opportunities, and with the opportunities the incentives, of talent and capital; but, while giving the strong their head, in the belief that they will carry on the world so far after them, it would insist on the public authority taking sharp heed that no large section of the common people be suffered to fall permanently behind in the race, to lose the very conditions of further progress, and to lapse into ways of living which the opinion of the time thinks unworthy of our common humanity. Now State socialism disregards these limits, straying generally far beyond them, and it may not improperly be defined as the system which requires the State to do work it is unfit to do in order to invest the working classes with privileges they have no right to get.

The term State socialism originated in Germany a few years ago to express the antithesis not of free, voluntary, or Christian socialism, as seems frequently to be imagined here, but of revolutionary socialism, which is always considered to be socialism proper, because it is the only form of the system that is of any serious moment at the present day. State socialism has the same general aims as socialism proper, only it would carry out its plans gradually by means of the existing State, instead of first overturning the existing State by revolution and establishing in its place a new political organization for the purpose, the Social Democratic Republic. There are socialists who fancy they have but at any moment to choose a government and issue a decree, as Napoleon once did—"Let misery be abolished this day fortnight"—and misery would be abolished that day fortnight. But the State socialists are unable to share this simple faith. They are State socialists not because they have more confidence in the State than other socialists, but because they have less. They consider it utterly futile to expect a democratic community ever to be able to create a political executive that should be powerful enough to carry through the entire socialistic programme. Like the Social Conservatives of all countries, like our own Young England party, for example, or the Tory Democrats of the present generation, they combine a warm zeal for popular amelioration with a profound distrust of popular government; but when compared with other socialists, they take a very sober view of the capacity of government of any kind; and although they believe implicitly in the "Social Monarchy of the Hohenzollerns," they doubt whether the strongest monarchy the world has ever seen would be strong enough to effect a socialistic reconstruction of the industrial system without retaining the existence for many centuries to come of the ancient institutions of private property and inheritance.

All that is at least very frankly acknowledged by Rodbertus, the remarkable but overrated thinker whom the State socialists of Germany have chosen for their father. Rodbertus was always regarded as a great oracle by Lassalle, the originator of the present socialist agitation, and his authority is constantly quoted by the most eminent luminary among the State socialists of those latter days, Professor Adolph Wagner, who says it was Rodbertus that first shed on him "the Damascus light that tore from his eyes the scales of economic individualism." Rodbertus had lived for a quarter of a century in a political sulk against the Hohenzollerns. Though he had served as a Minister of State, he threw up his political career rather than accept a constitution as a mere royal favour; he refused to work under it or recognise it by so much as a vote at the polls. But when the power of the Hohenzollerns became established by the victories of Königgrätz and Sedan, and when they embarked on their new policy of State socialism, Rodbertus developed into one of their most ardent worshippers. Their new social policy, it is true, was avowedly adopted as a corrective of socialism, as a kind of inoculation with a milder type of the disease in order to procure immunity from a more malignant; but Bismarck contended at the same time that it was nothing but the old traditional policy of the House of Prussia, who had long before placed the right of existence and the right of labour in the statute-book of the country, and whose most illustrious member, Frederick the Great, used to be fond of calling himself "the beggars' king." Under these circumstances Rodbertus came to place the whole hope of the future in the "Social Monarchy of the Hohenzollerns," and ventured to prophesy that a socialist emperor would yet be born to that House who would rule possibly with a rod of iron, but would always rule for the greatest good of the labouring class. Still, even under a dynasty of socialist emperors Rodbertus gave five hundred years for the completion of the economic revolution he contemplated, because he acknowledged it would take all that time for society to acquire the moral principle and habitual firmness of will which would alone enable it to dispense with the institutions of private property and inheritance without suffering serious injury.

In theory Rodbertus was a believer in the modern social democratic doctrine of the labourer's right to the full product of his labour—the doctrine which gives itself out as "scientific socialism," because it is got by combining a misunderstanding of Ricardo's theory of wages with a misunderstanding of the same economist's theory of value—and which would abolish rent, interest, profit, and all forms of "labourless income," and give the entire gross product to the labourer, because by that union of scientific blunders it is made to appear that the labourer has produced the whole product himself. Rodbertus, in fact, claimed to be the author of that doctrine, and fought for the priority with Marx, though in reality the English socialists had drawn the same conclusions from the same blunders long before either of them; but author or no author of it, his sole reason for touching the work of social reform at all was to get that particular claim of right recognised. Yet for five hundred years Rodbertus will not wrong the labourers by granting them their full rights. He admits that without the assistance of the private capitalist during that interval labourers would not produce so much work, and therefore could not earn so much wages as they do now; and consequently, in spite of his theories, he declines to suppress rent and interest in the meantime, and practically tells the labourers they must wait for the full product of labour till the time comes when they can produce the full product themselves. That is virtually to confess that while the claim may be just then, it is unjust now; and although Rodbertus never makes that acknowledgment, he is content to leave the claim in abeyance and to put forward in its place, as a provisional ideal of just distribution more conformable to the present situation of things, the claim of the labourer to a progressive share, step for step with the capitalist, in the results of the increasing productivity given to labour by inventions and machinery. He thought that at present, so far from getting the whole product of labour, the labourer was getting a less and less share of its products every day, and though this can be easily shown to be a delusive fear, Rodbertus's State socialism was devised to counteract it.

For this purpose the first requisite was the systematic management of all industries by the State. The final goal was to be State property as well as State management, but for the greater part of five centuries the system would be private property and State management. Sir Rowland Hill and the English railway nationalizers proposed that the State should own the lines, but that the companies should continue to work them; Rodbertus's idea, on the contrary, is that the State should work, but not own. But then the State should manage everything and everywhere. Co-operation and joint-stock management were as objectionable to him as individual management. He thought it a mere delusion to suppose, as some socialists did, that the growth of joint-stock companies and co-operative societies is a step in historical evolution towards a socialist régime. It was just the opposite; it was individual property in a worse form, and he always told his friend Lassalle that it was a hopeless dream to expect to bring in the reign of justice and brotherhood by his plan of founding productive associations on State credit, because productive societies really led the other way, and created batches of joint-stock property, which he said would make itself a thousand times more bitterly hated than the individual property of to-day. One association would compete with another, and the group on a rich mine would use their advantage over the group on a poor one as mercilessly as private capitalists do now. Nothing would answer the end but State property, and nothing would conduce to State property but State management.

The object of all this intervention, as we have said, is to realize a certain ideal or standard of fair wages—the standard according to which a fair wage is one that grows step by step with the productive capacity of the country; and the plan Rodbertus proposes to realize it by is practically a scheme of compulsory profit-sharing. He would convert all land and capital into an irredeemable national stock, of which the present owners would be constituted the first or original holders, which they might sell or transfer at pleasure but not call up, and on which they should receive, not a fixed rent or rate of interest, but an annual dividend varying with the produce or profits of the year. The produce of the year was to be divided into three parts: one for the landowners, to be shared according to the amount of stock they respectively held; a second for the capitalists, to be shared in the same way; and the third for the labourers, to be shared by them according to the quantity of work they did, measured by the time occupied and the relative strain of their several trades. This division was necessarily very arbitrary in its nature; there was no principle whatever to decide how much should go to the landowners, and how much to capitalists, and how much to labourers; and although there was a rule for settling the price of labour in one trade as compared with the price of labour in another, it is a rule that would afford very little practical guidance if one came to apply it in actual life. At all events, Rodbertus himself toiled for years at a working plan for his scheme of wages, but though he always gave out that he had succeeded in preparing one, he steadily refused to disclose it even to trusted admirers like Lassalle and Rudolph Meyer, on the singular pretext that the world knew too little political economy as yet to receive it, and at his death nothing of the sort seems to have been discovered among his papers. Is it doing him any injustice to infer that he had never been able to arrive at a plan that satisfied his own mind as to its being neither arbitrary nor impracticable?

Now this is a good specimen of State socialism, because it is so complete and brings out so decisively the broad characteristics of the system. In the first place, it desires a progressive and indiscriminate nationalization of all industries, not because it thinks they will be more efficiently or more economically managed in consequence of the change, but merely as a preliminary step towards a particular scheme of social reform; in the next place, that scheme of social reform is an ideal of equitable distribution which is demonstrably false, and is admittedly incapable of immediate realization; in the third place, a provisional policy is adopted in the meanwhile by pitching arbitrarily on a certain measure of privileges and advantages that are to be guaranteed to the labouring classes by law as partial instalments of rights deferred or compensations for rights alleged to be taken away.

It may be that not many State socialists are so thoroughgoing as Rodbertus. Few of them possibly accept his theory of the labourer's right—which is virtually that the labourer has a right to everything, all existing wealth being considered merely an accumulation of unpaid labour—and few of them may throw so heavy a burden on the State as the whole production and the whole distribution of the country. But they all start from some theory of right that is just as false, and they all impose work on the State which the State cannot creditably perform. They all think of the mass of mankind as being disinherited in one way or another by the present social system, perhaps through the permission of private property at all, perhaps through permission of its inequalities. M. de Laveleye, indeed, goes a step further back still. In an article he has contributed on this subject to the Contemporary Review, he uses as his motto the saying of M. Renan that Nature is injustice itself, and he would have society to correct not merely the inequalities which society may have itself had a share in establishing, but also the inequalities of talent or opportunity which are Nature's own work. Accordingly, M. de Laveleye describes himself as a State socialist, because he thinks "the State ought to make use of its legitimate powers for the establishment of the equality of conditions among men in proportion to their personal merit." Equality of conditions and personal merit are inconsistent standards, but if they were harmonious, it would be beyond the power of the State to realize them for want of an effective calculus of either.

Few State socialists, however, profess the purpose of correcting the differences of native endowment; for the most part, when they found their policy on any theoretic idea at all, they found it on some idea of historical reparation. In this country, socialist notions always crop up out of the land. German socialists direct their attack mainly on capital, but English socialism fastens very naturally on property in land, which in England is concentrated into unnaturally few hands: and a claim is very commonly advanced for more or less indefinite compensation to the labouring class on account of their alleged disinheritance, through the institution of private property, from their aboriginal or natural rights to the use of the earth, the common possession of the race. That is the ground, for example, which Mr. Spencer takes for advocating land nationalization, and Mr. Chamberlain for his various claims for "ransom." The last-comer is held to have as good a right to the free use of the earth as the first occupant; and if society deprives him of that right for purposes of its own, he is maintained to be entitled to receive some equivalent, as if society does not already give the new-comer vastly more than it took away. His chances of obtaining a decent living in the world, instead of being reduced, have been immensely multiplied through the social system that has resulted from the private appropriation of land. The primitive economic rights whose loss socialists make the subject of so much lamentation are generally considered to be these four: (1) the right to hunt; (2) the right to fish; (3) the right to gather nuts and berries; and (4) the right to feed a cow or sheep on the waste land. Fourier added a fifth—which was certainly a right much utilized in early times—the right of theft from people over the border of the territory of one's own tribe. Let that right be thrown in with the rest; then the claim with which every English child is alleged to be born, and for which compensation is asked, is the claim to a thirty-millionth part of the value of these five aboriginal uses of the soil of England; and what is that worth? Why, if the "prairie value" of the soil is estimated at the high figure of a shilling the acre per annum, it would only give every inhabitant something under half a crown, and when compensation is demanded for the loss of this ridiculous pittance, one calls to mind what immensely greater compensations the modern child is born to. Civilization is itself a social property, a common fund, a people's heritage, accumulating from one generation to another, and opening to the new-comer economic opportunities and careers incomparably better and more numerous than the ancient liberties of fishing in the stream or nutting in the forest. The things actually demanded for the poor in liquidation of this alleged claim may often be admissible on other grounds altogether, but to ask them in the name of compensation for the loss of those primitive economic rights—even though it was done by Spencer or Cobden—is certainly State socialism.

Mr. Chamberlain's famous "ransom" speeches are an example of that. There was nothing socialist about the substance of his proposals. He expressly disclaimed all sympathy with the idea of equality of conditions; he hesitated about applying the graduated taxation principle to anything but legacies; he explicitly said he would do nothing to discourage the cumulative principle in the rich, or the habit of industry in the poor; he asked mainly for free schools, free libraries, free parks, and other things of a like character; but then he asked for them as a penalty for wrong-doing, instead of an obligation of ability—as a ransom to be paid by the rich, or by society generally, for having ousted the poor out of their aboriginal rights. Mr. Chamberlain merely pled for useful social reforms in a socialistic spirit.

The favourite theory on which the German State socialists proceed seems to be that men are entitled to an equalization of opportunities, to an immunity, as far as human power can secure it, from the interposition of chance and change. That at least is the view of Professor Adolph Wagner, whose position on the subject is of considerable consequence, because he is the economist-in-ordinary to the German Government, and has been Prince Bismarck's principal adviser in connection with all his recent social legislation. Professor Wagner may be taken as the most eminent and most authoritative exponent of the theory of State socialism, and he recently developed his views on the subject afresh in some articles in the Tübingen Zeitschrift für die Gesammten Staatswissenschaften for 1887, on "Finanz-politik und Staatsozialismus." According to Wagner, the chief aim of the State at present—in taxation and in every other form of its activity—ought to be to alter the national distribution of wealth to the advantage of the working class. All politics must become social politics; the State must turn workman's friend. For we have arrived at a new historical period; and just as the feudal period gave way to the absolutist period, and the absolutist period to the constitutional, so now the constitutional period is merging in what ought to be called the social period, because social ideas are very properly coming more and more to influence and control everything, alike in the region of production, in the region of distribution, and in the region of consumption. Now, according to Wagner, the business of the State socialist is simply to facilitate the development of this change—to work out the transition from the constitutional to the social epoch in the best, wisest, and most wholesome way for all parties concerned. He rejects the so-called "scientific socialism" of Marx and Rodbertus and Lassalle, and the practical policy of the social democratic agitation; and he will not believe either that a false theory like theirs can obtain a lasting influence, or that a party that builds itself on such a theory can ever become a real power. But, at the same time, he cannot set down the socialistic theory as a mere philosophical speculation, or the socialistic movement as merely an artificial product of agitation. The evils of both lie in the actual situation of things; they are products—necessary products, he says—of our modern social development; and they will never be effectually quieted till that development is put on more salutary lines. They have a soul of truth in them, and that soul of truth in the doctrines and demands of radical socialism is what State socialism seeks to disengage, to formulate, to realize. It is quite true, for example, that the present distribution of wealth, with its startling inequalities of accumulation and want, is historically the effect, first, of class legislation and class administration of law; and second, of mere blind chance operating on a legal régime of private property and industrial freedom, and a state of the arts which gave the large scale of production decided technical advantages. In one of his former writings, Professor Wagner contended that German peasants lived to this day in mean thatched huts, simply because their ancestors had been impoverished by feudal exactions and ruined by wars which they had no voice in declaring; and he seems to be now as profoundly impressed with the belief that the present liberty allowed to unscrupulous speculators to utilize the chances and opportunities of trade at the cost of others is producing evils in no way less serious, which ought to be checked effectively while there is yet time. So long as such tendencies are left at work, he says it is idle trying to treat socialism with any cunning admixture of cakes and blows, or charging State socialists with heating the oven of social democracy. State socialists, he continues, comprehend the disease which Radical socialists only feel wildly and call down fire to cure, and they are as much opposed to the purely working-class State of the latter, as they are to the purely constitutional State of our modern Liberalismus vulgaris, as Wagner calls it.

The true Social State lies, in his opinion, between the two. What the new social era demands—the era which is already, he thinks, well in course of development, but which it is the business of State socialism to help Providence to develop aright—is the effective participation of poor and rich alike in the civilization which the increased productive resources of society afford the means of enjoying; and this is to be brought about in two ways: first, by a systematic education of the whole people according to a well-planned ideal of culture, and second, by a better distribution of the income of society among the masses. Now, to carry out these requirements, the idea of liberty proper to the constitutional era must naturally be finally discarded, and a very large hand must be allowed to the public authority in every department of human activity, whether relating to the production, distribution, or consumption of wealth. In the first place, in order to destroy the effect of chance and of the utilization of chances in creating the present accumulations in private hands, it is necessary to divert into the public treasury as far as possible the whole of that part of the national income which goes now, in the form of rent, interest, or profit, into the pockets of the owners of land and capital, and the conductors of business enterprises. Wagner would accordingly nationalize (or municipalize) gradually so much of the land, capital, and industrial undertakings of the country as could be efficiently managed as public property or public enterprises, and that would include all undertakings which tend to become monopolies even in private hands, or which, being conducted best on the large scale, are already managed under a form of organization which, in his opinion, has most of the faults and most of the merits of State management—viz., the form of joint-stock companies. He would in this way throw on the Government all the great means of communication and transport, railways and canals, telegraphs and post, and all banking and insurance; and on the municipalities all such things as the gas, light, and water supply. Although he recognises the suitability of Government management as a consideration to be weighed in nationalizing an industry, he states explicitly that the reason for the change he proposes is not in the least the fiscal or economic one that the industry can be more advantageously conducted by the Government, but is a theory of social politics which requires that the whole economic work of the people ought to be more and more converted from the form of private into the form of public organization, so that every working man might be a public servant and enjoy the same assured existence that other public servants at present possess.

In the next place, since many industries must remain in private hands, the State is bound to see the existence of the labourers engaged in private works guaranteed as securely as those engaged in public works. It must take steps to provide them with both an absolute and a relative increase of wages by instituting a compulsory system of paying wages as a percentage of the gross produce; it must guarantee them a certain continuity of employment; must limit the hours of their labour to the length prescribed by the present state of the arts in the several trades; and supply a system of public insurance against accidents, sickness, infirmity, and age, together with a provision for widows and orphans.

In the third place, all public works are to be managed on the socialistic principle of supplying manual labourers with commodities at a cheaper rate than their social superiors. They are to have advantages in the matters of gas and water supply, railway fares, school fees, and everything else that is provided by the public authority.

In the fourth place, taxation is to be employed directly to mitigate the inequalities of wealth resulting from the present commercial system, and to save and even increase the labourer's income at the expense of the income of other classes. This is to be done by the progressive income-tax, and by the application of the product of indirect taxation on certain articles of working-class consumption to special working-class ends. For example, he thinks Prince Bismarck's proposed tobacco monopoly might be made "the patrimony of the disinherited."

In the fifth place, the State ought to take measures to wean the people not only from noxious forms of expenditure, like the expenditure on strong drink, but from useless and wasteful expenditure, and to guide them into a more economic, far-going, and beneficial employment of the earnings they make.

Now for all this work, involving as it does so large an amount of interference with the natural liberty of things, Wagner not unreasonably thinks that a strong Government is absolutely indispensable—a Government that knows its own mind, and has the power and the will to carry it out; a Government whose authority is established on the history and opinion of the nation, and stands high above all the contending political factions of the hour. And in Germany, such an executive can only be found in the present Empire, which is merely following "Frederician and Josephine traditions" in coming forward, as it did in the Imperial message of November, 1881, as a genuine "social monarchy."

In this doctrine of Professor Wagner we find the same general features we have already seen in the doctrine of Rodbertus. It is true he would not nationalize all industries whatsoever; he would only nationalize such industries as the State is really fit to manage successfully. He admits that uneconomic management can never contribute to the public good, and so far he accepts a very sound principle of limitation. But then he applies the principle with too great laxity. He has an excessive idea of the State's capacities. He thinks that every business now conducted by a joint-stock company could be just as well conducted by the Government, and ought therefore to be nationalized; but experience shows—railway experience, for example—that joint-stock management, when it is good, is better than Government management at its best. Then Professor Wagner thinks every industry which has a natural tendency to become in any case a practical monopoly would be better in the hands of the Government; but Government might interfere enough to restrain the mischiefs of monopoly—as it does in the case of railways in this country, for example—without incurring the liabilities of complete management. Professor Wagner would in these ways throw a great deal of work on Government which Government is not very fit to accomplish successfully, and he would like to throw everything on it, if he could overcome his scruples about its capabilities, because he thinks industrial nationalization would facilitate the realization of his particular views of the equitable distribution of wealth. It is true, again, that Wagner's theory of equitable distribution is not the theory of Rodbertus—he rejects the right of labour to the whole product; but his theory, if less definite, is not less unjustifiable. It is virtually the theory of equality of conditions which considers all inequalities of fortune wrong, because they are held to come either from chance, or—what is worse—from an unjust utilization of chance, and which, on that account, takes comparative poverty to constitute of itself a righteous claim for compensation as against comparative wealth. Now, a state of enforced equality of conditions would probably be found neither possible nor desirable, but it is in its very conception unjust. It may be well, as far as it can be done, to check refined methods of deceit, or cruel utilizations of an advantageous position, but it can never be right to deprive energy, talent, and character of the natural reward and incentive of their exertions. The world would soon be poor if it discouraged the skill of the skilful, as it would soon cease to be virtuous if it ostracized those who were pre-eminently honest or just. The idea of equality has been a great factor in human progress, but it requires no such outcome as this. Equality is but the respect we owe to human dignity, and that very respect for human dignity demands security for the fruits of industry to the successful, and security against the loss of the spirit of personal independence in the mass of the people. But while that is so, there is one broad requirement of that same fundamental respect for human dignity which must be admitted to be wholly just and reasonable—the requirement which we have seen to have been recognised by the English economists—that the citizens be, as far as possible, secured, if necessary by public compulsion and public money, in the elementary conditions of all humane living. The State might not be right if it gave the aged a comfortable superannuation allowance, or the unemployed agreeable work at good wages; but it is only doing its duty when, with the English law, it gives them enough to keep them, without taking away from the one the motives for making a voluntary provision against age, or from the other the spur to look out for work for themselves.

It will be said that this is a standard that is subject to a certain variability; that a house may be considered unfit for habitation now that our fathers would have been fain to occupy; that shoes seem an indispensable element of humane living now, though, as Adam Smith informs us, they were still only an optional decency in some parts of Scotland in his time. But differences of this nature lead to no practical difficulty, and the standard is fixity of measure itself when compared with the indefinite claims that may be made in the name of historical compensation, or wild theories of distributive justice, and it makes a wholesome appeal to recognised obligations of humanity instead of feeding a violent sense of unbounded hereditary wrong. At all events, it presents the true equality—equality of moral rights—over against the false equality of State socialism—equality of material conditions; and it is able to present a better face against that system, because it recognises a certain measure of material conditions among the original moral rights. For this reason the English theory of social politics is the best practical criterion for discriminating between socialistic legislation and wholesome social reforms. The State socialistic position cannot be advantageously attacked from the ground of Mr. Spencer and the adherents of laissez-faire, who merely say, Let misfortune and poverty alone; whether remediable or irremediable, they are not the State's affairs. The two theories nowhere come within range; but the English theory meets State socialism at every point, almost hand to hand, for it admits the State's competency to deal with poverty and misfortune, and to alter men's material conditions to the extent needed for the practical realization of their full moral rights.

 

III. State Socialism and Social Reform.

On this English theory of social politics, the State, though not socialist, is very frankly social reformer, and those schools of opinion, which are usually thought to have been most averse to Government intervention, have been among the most earnest in pressing that rôle upon the State. Cobden, I presume, may be taken as a fair representative of the Manchester school, and Cobden, with all his love of liberty, loved progress more, and thought the best Government was the Government that did most for social reform. When he visited Prussia in 1838, he was struck with admiration at the paternal but improving rule he found in operation there. "I very much suspect," he said, "that at present for the great mass of the people Prussia possesses the best Government in Europe. I would gladly give up my taste for talking politics, to secure such a state of things in England. Had our people such a simple and economical Government, so deeply imbued with justice to all, and aiming so constantly to elevate mentally and morally its population, how much better would it be for the twelve or fifteen millions in the British Empire, who, while they possess no electoral rights, are yet persuaded they are freemen!" So far from thinking, as the Manchester man of polemics is always made to think, that the State goes far enough when it secures to every man liberty to pursue his own interest his own way, as long as he does not interfere with the corresponding right of his neighbours, the Manchester man of reality takes the State severely to task for neglecting to promote the mental and moral elevation of the people; the chief end of Government being to establish not liberty alone, but every other necessary security for rational progress. The theory of laissez-faire would of course permit measures required for the public safety, but what Cobden calls for are measures of social amelioration. Provisions for the better protection of person and property, as they exist, against violence or fraud, make up but a small part of legitimate State duty, compared with provisions for their better development, for enlarging the powers of the national manhood, or the product of the national resources. The institution of property itself is a provision for progress, and could never have originated under the system of laissez-faire, which now makes it a main branch of State work to defend it. In the form of permanent and exclusive possession, it is undoubtedly a contravention of the equal freedom of all to the use of their common inheritance, committed for the purpose of securing their more productive use of it. It interferes with their access to the land, and with the equality of their opportunities, but then it enhances and concentrates the energies of the occupants, and it doubles the yield of the soil. It promotes two objects, which are quite as paramount concerns of the State as liberty itself—it improves the industrial manhood of the nation, and it increases the productivity of the natural resources; and institutions that conduce to such results are not really infractions of liberty, but rather complements of it, because they give people an ampler use of their own powers, and create, by means of the increase of production they work, more and better opportunities than those they take away.

Now the lines of legitimate intervention prescribed by the necessities of progress, and already followed in the original institution of property, will naturally, when extended through our complicated civilization, include a very considerable and varied field of social and industrial activity, and this has been all along recognised by the English economists and statesmen. While opposed to the State doing anything either moral or material for individuals, which individuals could do better, or with better results, for themselves, they agreed in requiring the State, first, to undertake any industrial work it had superior natural advantages for conducting successfully; and second, to protect the weaker classes effectively in the essentials of all rational and humane living—in what Adam Smith calls "an undeformed and unmutilated manhood"—not only against the ravages of violence or fear or insecurity, but against those of ignorance, disease, and want. Smith, we know, would even save them from cowardice by a system of military training, and from fanaticism by an established Church, because, he said, cowardice and fanaticism were as great deformities of manhood as ignorance or disease, and prevented a man from having command of himself and his own powers quite as effectually as violence or oppression. Laws which give every man better command and use of his own energies are in manifest harmony with liberty, and for the State to do such industrial work as it has special natural advantages for doing is conformable with the principle of free-trade itself, which has always prescribed to men and nations as the best rule for their prosperity, that they should concentrate their strength on the branches of industry they possess natural advantages for cultivating, and give up wasting their labour on less productive employment. Mr. Chamberlain is certainly wrong in thinking over-government an extinct danger under democratic institutions, a mere survival from times of oppression which haunts the people still, though they are their own masters, with foolish fears of over-governing themselves. In reality, the danger has much more probably increased, as John Stuart Mill believed, for if we cannot over-govern ourselves, we can very easily and cheerfully over-govern one another, and a majority may impose its brute will with even less scruple than a monarch; but however that may be, those who tremble most sincerely for the ark of liberty cannot see any undue contraction of the field of individual action in an extension of authority for either of the two purposes here specified, for the purpose of undertaking industrial work which private initiative cannot prosecute so advantageously, or of making more secure to the weaker citizens those primary conditions of normal humanity, which are really their natural right. The first of these purposes is quite consistent with the principles of men like W. von Humboldt, who contend that the best means of national prosperity is the cultivation to the utmost of the individual energy of the people, and who are opposed to Government interference because it represses or supplants that energy. They welcome everything that tends to economize and develop energy, to place things in the hands of those that can do them best, and generally to increase the productive capacity of the whole community. They believe that machinery, division of labour, factory systems, keenest conditions of competition, however they may at first seem to contract men's opportunities of employment, always end in multiplying them, and, because they increase or economize the productive powers of those actually employed, really expand the field of employment for all. Now Government management would of course have a like operation wherever Government management effected a like economy or increase in the productive powers of society, and would really expand the field of individual initiative which it appeared to contract; and those who believe most in individual energy and its power of seeking out for itself the most advantageous new outlets, will find least to complain of in an intervention of authority which releases men from work ill-suited to their powers to do, and sends them into work where their powers can be more fruitfully occupied.

The second purpose of legitimate intervention seems even less open to objection from that side. The State is asked to go in social reform only as far as it goes in judicial administration—it is asked to secure for every man as effectively as it can those essentials of all rational and humane living which are really every man's right, because without them he would be something less than man, his manhood would be wanting, maimed, mutilated, deformed, incapable of fulfilling the ends of its being. Those original requirements of humane existence are dues of the common nature we wear, which, we cannot see extinguished in others without an injury to our own self-respect, and the State is bound to provide adequate securities for one of them as much as for another. The same reason which justified the State at first in protecting person and property against violence, justified it yesterday in abolishing slavery, justifies it to-day in abolishing ignorance, and will justify it to-morrow in abolishing other degrading conditions of life. The public sense of human dignity may grow from age to age and be offended to-morrow by what it tolerates to-day, but the principle of sound intervention is all through the same—that the proposed measure is necessary to enable men to live the true life of a man and fulfil the proper ends of rational being. A thoughtful French writer defends State intervention for the purpose of social amelioration as being a mere duty of what he calls reparative justice. Popular misery and decadence, he would say, is always very largely the result of bad laws and other bad civil conditions, as we see it plainly to have been in the case of the Irish cottiers, the Scotch crofters, and the rural labourers of England, and when the community has really inflicted the injury, the community is bound in the merest justice to repair it. And the obligation would not be exhausted with the repeal of bad laws; it would require the positive restoration to the declining populations of the conditions of real prosperity from which they fell. But though this is a specific ground which may occasionally quicken the State's remedial action with something of the energy of remorse, it is no extension of its natural and legitimate sphere of intervention, and the State might properly take every measure necessary for the effectual restoration of a declining section of the population to conditions of real prosperity on the broad and simple principle already laid down, that the measure is necessary to put those people in a position to fulfil their vocation as human beings. Hopeless conditions of labour are as contrary to sound nature, and as fatal to any proper use of man's energies, as slavery itself, and their mere existence constitutes a sufficient cause for the State's intervention, apart from any special responsibility the State may bear for their historical origin. Even the measure of the required intervention is no way less, for if its purpose is to preserve some essential of full normal manhood, its only limit is that of being effectual to serve the purpose. The original natural obligation of the State needs no expansion then from historical responsibilities to cover any effectual form of remedial action against the social decadence of particular classes of the population, whether it be the constitution of a new right like the right to a fair rent, the adoption of administrative measures like the migration of redundant inhabitants, or the provision of wise facilities for the rest by the loan of public money.

It is plain, therefore, that we have here within the lines of accepted and even "orthodox" English theory a doctrine of social politics which gives the Government an ample and perfectly adequate place in the promotion of all necessary social reform; and if we are all socialists now, as is so often said, it is not because we have undergone any change of principles on social legislation, but only a public awakening to our social miseries. The Churches, for example, while they left Lord Shaftesbury to fight his battles for the helpless alone, have now shared in this social awakening, and show not only a general ardour to agitate social questions, but even some pains to understand them; but the Churches did not neglect Lord Shaftesbury fifty years ago, because they thought his Factory Bills proceeded from unsound views of the State's functions, but merely because their interest was not then sufficiently aroused in the temporal welfare of the poor, and with all their individual charities they responded little to the grievances of social classes. We are all socialists now, only in feeling as much interest in these grievances as the socialists are in the habit of doing, but we have not departed from our old lines of social policy, and there is no need we should, for they are broad enough to satisfy every claim of sound social reform.

It is only when these lines are transgressed that, strictly speaking, socialism begins; and though it is hopeless to think of confining the vulgar use of the word to its strict signification, it is at least essential to do so if we desire any clear or firm grasp of principle. The socialism of the present time extends the State's intervention from those industrial undertakings it is fitted to manage well to all industrial undertakings whatever, and from establishing securities for the full use of men's energies to attempting to equalize in some way the results of their use of them. It may be shortly described as aiming at the progressive nationalization of industries with a view to the progressive equalization of incomes. The common pleas for this policy are, first, the necessity of introducing a distribution of wealth more in accordance with personal merit by neutralizing the effects of chance, which at present throw some into opulence without any co-operation from their own labour, and press thousands into penury in spite of their most honest exertions; and second, the advantage society would reap from the mere economy of the resources at present wasted in unnecessary competition. Both pleas are, however delusive; it is neither good nor possible to suppress chance, and if competition involves some loss, it yields a much more abounding gain.

A sense of the blind play of chance in all things human lies indeed beneath all work of social relief. "Hodie mihi, cras tibi," wrote the good Regent Murray over his lintel to avert the grudge of envy, and the same feeling of the uncertainty of fortune quickens the thought of pity. Men reflect how much of their own comfort they owe to good circumstances rather than good deserts, and how much more bad circumstances have often to do with poverty than bad guiding. To change these bad conditions so far as to preserve for every man intact the essentials of common progressive manhood is a proper object of social work. But while mitigating the operation of chance to that extent is well, to try and suppress its operation altogether would be injurious, even if it were possible. For there is no pursuit under the sun in which chance has not its part as well as skill, and skill itself is often nothing but a quick grasp of happy chance. To discourage the alert from seizing good opportunities on the wing, by confiscating the results and distributing them among the languid and inactive, is the same thing as to discourage them by like means from exerting all their industry in any other way. It violates their individual right with no better effect than to cripple the national production. They are entitled to the best conditions for the successful use of their individual energies, and the best conditions for the use of individual energies are the true securities for national progress. The sound policy is not the greater equalization of opportunities, but their greater utilization. It may be right to make ships seaworthy and their masters competent navigators, but if one of them gets delayed in a calm or disabled by a storm, while another has caught a fair wind and is carried on to port, it would answer no good purpose to equalize their gains for the mere correction of the inequality in their opportunities. It would relax in both masters alike the supreme essentials of all successful labour—activity, vigilance, enterprise. State action with respect to the quips and arrows of fortune ought to go as far but no farther than State action with respect to the crimes and hostilities of men, or with respect to evil forces of nature like those of infectious diseases—it ought to content itself with effectually protecting the primary conditions of sound manhood against their outrages. It may do what it can, not merely to relieve the unfortunate in their extremity, but to prevent their coming to extremity, to arrest, if possible, their decline, to check or soften the trade fluctuations that often swamp them, and to facilitate their self-recovery; but, when it goes on to suppress or equalize the operation of fortune, it destroys the good with the evil, and even if it removed the tares, would find it had only spoiled the harvest of wheat. The present industrial system has its defects, but it certainly has one immense advantage which would be forfeited under socialism—it tends to elicit to their utmost the talents and energies alike of employers and employed. The languor of the "Government stroke" and the slow mechanism of a State department are unfavourable to an abundant production. The general slackening of industry, and the extinction of those innumerable sources of active initiative which at present are so busy pushing out new and fruitful developments, are too great a price to pay for the suppression of the evils of competition. To effect some economies in the use of capital, we damage or destroy the forces by which capital is produced, and really lose the pound to save the penny.

Even from the standing-point of a good distribution of wealth, if by a good distribution we mean, not an equal distribution of the produce, however small the individual share, but, what is surely much better, a high general level of comfort, though considerable inequalities may remain, then an abundant production is still the most indispensable thing, for it is the most certain of all means to that high general level of comfort. Even in those agricultural countries where this result is promoted by a land system favouring peasant properties, the result is largely due to the fact that occupying ownership is itself the best condition for high production; and if we compare the principal modern industrial nations, we shall find labour enjoying the best real remuneration in those where the rate of production is highest, where employers are most competent, machinery most perfected, and labour itself personally most efficient. And, on the other hand, while the general level of comfort rises under a policy that develops productivity even at the risk of widening inequality, the general level of comfort always sinks under the contrary policy which sacrifices productivity to socialistic ideas and claims.

We have practical experience of the working of socialism in various forms, and under the most opposite conditions of culture, and the experience is everywhere the same. Custom in Samoa, for example, gives a man a pretty strict right to go to his neighbour and requisition what he wants, or even to quarter himself in the house without payment, as long as he pleases. No one dares to refuse, for fear of losing credit and suffering reproach. Originating as a well-meant refuge for the distressed, the system has become still more a subterfuge for the lazy, and Dr. Turner sums up his account of it by saying, "This communistic system is a sad hindrance to the industrious, and eats like a canker-worm at the roots of individual and national progress." The disheartening of the industrious has an even worse effect than the encouragement of the indolent; the more they make, the more subject they are to the imposition. The English agricultural labourers belong to a very different state of society from the savages of Samoa. They are of an energetic race, which if it does not positively love work, has probably as little aversion to it as any nation in the world, and seems often really to delight in the hardest exertion; but in England the effect of giving the poor a similar socialistic right was precisely the same as in Samoa. While we are supposed to have been advancing in socialism with our Factory Acts, we were really retreating from it in our Poor Law. The old English laws which for centuries first fixed labourers' wages, and then made up the deficiencies of the wages, if such occurred, out of the poor rates, were certainly socialistic, and the commission that inquired into their working sixty years ago reported that their worst effect had been to make the labourers such poor workers that they were hardly worth the wages they got. The men were by law unable to earn more if they worked more, or to lose anything if they worked less, and so their very working powers drooped and withered. As most modern socialists put their trust entirely in the old motive of self-interest, and propose to pay every man according to his work, their only resource against such a result would be a stern system of poor-law administration, like the English, and that would of course involve a departure from their favourite ideal of furnishing the dependent poor with as decent and comfortable a living as the independent poor gain for themselves by their work. The change from Samoa to rural England is probably not so great as the change from rural England to Brook Farm and the other experimental communities of the United States, companies of cultivated and earnest people, coming from one of the best civilized stocks, and settling under the favourable material conditions of a new country for the very purpose of working out a socialist ideal. Yet in these American communities, socialistic institutions led to precisely the same results as they did in England and in Samoa, a slackening of industry, and a deterioration of the general level of comfort. No doubt, as Horace Greeley said, who knew these communities well, and lived for a time in more than one of them, there came to them along with the lofty souls, who are willing to labour and endure, "scores of whom the world is quite worthy, the conceited, the crotchety, the selfish, the headstrong, the pugnacious, the unappreciated, the played-out, the idle, the good-for-nothing generally, who, finding themselves utterly out of place, and at a discount in the world as it is, rashly conclude that they are exactly fitted for the world as it ought to be." But the proportion of difficult subjects would not be larger in Brook Farm or New Harmony than it is in the ordinary world outside, and in these communities they would be under the constant influence of leaders of the highest character and an almost religious enthusiasm. If the new and better economic motives, which romantic socialists like Mr. Bellamy always assure us are to carry us to such great things as soon as the suppression of the present pecuniary motive allows them to rise into operation—if the love of work for its own sake, the sense of public duty, the desire of public appreciation, could be expected to prevail anywhere to any purpose, it would be among the gifted and noble spirits who founded the community of Brook Farm. But the late W. H. Channing, who was a member of the community and looked back upon it with the tenderest feelings, explains its failure by saying: "The great evil, the radical, practical danger, seemed to be a willingness to do work half thorough, to rest in poor results, to be content amidst comparatively squalid conditions, and to form habits of indolence."[8]

The idleness of the idle was one of the chief standing troubles in all the socialistic experiments of the United States. Mr. Noyes gives us an account of forty-seven communistic experiments which had been made under modern socialist influences in the United States and had failed, while Mr. Nordhoff, on the other hand, furnishes a like account of seventy-two communities, established mainly under religious influences (fifty-eight of them belonging to the Shakers alone), which have been not merely social but economic successes, some of them for more than a hundred years; and one is struck with the degree in which the idler difficulty has contributed to the failure of the forty-seven, and in which the continual and comparatively successful conflict with that difficulty by means of their peculiar system of religious discipline has aided in the success of the other seventy-two. Mr. Noyes is himself founder of the Oneida community, and bases his descriptions of the rest on information supplied by men who were members of the communities he describes, or on the materials collected by Mr. Macdonald, a Scotch Owenite, who visited most of the American communities for the purpose of describing them. No causes of failure are more often mentioned by him than "too many idlers" and "bad management." Not that industry was relaxed all round. On the contrary, it seems to have been a peculiarity of the Owenite and Fourierist communities, that the industrious wrought much harder (and in most of them for much poorer fare) than labourers of ordinary life. Macdonald was surprised at the marvellous industry he saw as he watched them, and would say to himself: "If you fail, I will give it up, for never did I see men work so well and so brotherly with each other." But then a little way off he would come on people who "merely crawled about, probably sick (he charitably suggests), just looking on like myself at anything which fell in their way." A very common feeling among members of these communities seems to have been that they were far more troubled with idlers than the rest of the world, because their system itself presented special attractions to that unwelcome class. "Men came," says one of the Trumbull Phalanx, "with the idea that they could live in idleness at the expense of the purchasers of the estate, and their ideas were practically carried out, while others came with good heart for the work." The same testimony is given about the Sylvania Association. "Idle and greedy people," says the writer of this testimony, "find their way into such attempts, and soon show forth their character by burdening others with too much labour, and in times of scarcity supplying themselves with more than their allowance of various necessaries, instead of taking less." Idle and greedy people, no doubt, did get into these communities, but these idle and greedy people constitute, I fear, a very large proportion of mankind, and the point is that socialistic institutions unfortunately offer them encouragement and opportunity. The experience of American communism directly contradicts John Stuart Mill's opinion, that men are not more likely to evade their fair share of the work under a socialistic system than they are now. That difficulty in one form or another was their constant vexation. The members of Owen's community at Yellow Springs belonged in general to a superior class; but one of them, in stating the causes of the failure of that community, says: "The industrious, the skilful, and the strong saw the products of their labour enjoyed by the indolent, and the unskilled, and the improvident, and self-love rose against benevolence. A band of musicians insisted that their brassy harmony was as necessary to the common happiness as bread and meat, and declined to enter the harvest field or the workshop. A lecturer upon Natural Science insisted upon talking only while others worked. Mechanics whose day's labour brought two dollars into the common stock insisted that they should in justice work only half as long as the agriculturist, whose day's work brought only one." The same evil, according to R. D. Owen, contributed to the fall of New Harmony; "there was not disinterested industry," he says, "there was not mutual confidence." A lady who was a member of the Marlboro' Association in Ohio, a socialistic experiment that lasted four years and then failed, attributes the failure to "the complicated state of the business concerns, the amount of debt contracted, and the feeling that each would work with more energy, for a time at least, if thrown upon his own resources, with plenty of elbow-room, and nothing to distract his attention."

The magnitude of this difficulty only appears the greater when we turn from the forty-seven socialistic experiments which have failed to the seventy-two which have thriven. The Shakers and Rappists are undoubtedly very industrious people, who, by producing a good article, have won and kept for years a firm hold of the American market, and being, in consequence of their institution of celibacy, a community of adult workers exclusively, every man and every woman being a productive labourer, the wonder is they are not wealthier and more prosperous even than they are. Their economic prosperity is based, as economic prosperity always is and must be, on their general habits of industry, and the natural tendency of socialistic arrangements to relax these habits is in their case effectually, though not without difficulty, counteracted by their religious discipline. Idleness is a sin; next to disobedience to the elders, no other sin is more reprobated among them, because no other sin is at once so besetting and so dangerous there, and the conquest and suppression of idleness is a continual object of their vigilance, and of their ordinary devotional practice. Mr. Nordhoff publishes a few of their most popular hymns, and one is struck with the space the cultivation of personal industry seems to occupy in their thoughts. "Old Slug," as they delight to nickname the idler, is the "Old Adam" of the Shakers, and a public sentiment of hatred and contempt for the indolent man is sedulously fostered by them. As they not only work, but also live under one another's constant supervision, and within earshot of one another's criticism, they more than replace the eye of the master by the keener and more sleepless eye of moral and social police. And if all this discipline fails, they have the last resource of expulsion. They easily make the idler too uncomfortable to remain. "They have," says Mr. Nordhoff, "no difficulty in sloughing off persons who come with bad or low motives." They exercise, in short, the power of dismissal, the last sanction in ordinary use in the old state of society. Not that they make any virtue of strenuous labour. They work moderately, and avoid anything like fatigue or exhaustion. They frankly acknowledged to Mr. Nordhoff, once and again, that three hired men taken in from the ordinary world would do as much work as five or six of their members. Their wants are few and simple, and they are satisfied with the moderate exertion that suffices to supply them; but they will tolerate no shirking of that in any shape or form, and this alone saves them from disaster. The experiences of these successful Shaker and Rappist communities serve, therefore, to show, even better than the experiences of the unsuccessful Owenite and Fourierist communities, the gravity that the idleness difficulty would assume in a general socialistic régime, which possessed nothing in the nature of the power of dismissal, and in which we could not calculate either on the formation of an effective public opinion against idleness, or on its effective application if it were formed. The men who founded the unsuccessful communities were far superior to the Shakers in business ability and education, and they had more money to begin their experiments with, but where they failed the Shakers have succeeded through the indirect economic effects of their rigorous religious discipline. But the evidence is as plain in the one case as in the other as to the natural, and even powerful, effect of socialistic arrangements in relaxing the industry of many sorts and conditions of men.

The same sources of evidence prove with equal clearness the development under socialistic institutions of two other concurrent causes of decline. I have already quoted Mr. Channing's statement that the Brook Farm community showed a disposition to be content with comparatively squalid conditions of life. Mr. Nordhoff would probably not use the word squalid of anything he saw in the Shaker and Rappist communities he describes, except perhaps in certain instances of the state of the public streets; and in some points, such as the scrupulous cleanness of the interior of their houses, he would set them far above their neighbours—you could eat your dinner, he says, off their floors. Still the people he found everywhere content, if not exactly with squalid, certainly with poor and dull and rough conditions of life, much poorer, duller, and rougher than they might easily be. They enjoyed equality, security from harassing anxiety for the morrow, abundance even for their limited wants, independence from subjection to a master, but they were weak in the ordinary springs of progress. The spirit of material improvement was not much abroad among them. Give me the stationary state of society and contentment, you may exclaim; but then even this stationary state is only maintained in these sequestered communities by the constant play of peculiar religious influences which cannot be counted on everywhere, and it would soon change into a declining state in the great seething world outside if it were not effectively counter-worked by the most powerful incentives to progress. Now the same equalizing social arrangements which destroy one of the most essential of these incentives by guaranteeing men the results of industry without its exertion, enfeeble a second by predisposing them to rest content with the lower conditions of life to which they are reduced.

A third cause of decline to which the American experience shows socialistic institutions to be incident is a certain weakness in the management, produced sometimes by divided counsels, sometimes by the delay involved in getting the sanction of a Board to every little detail of business, and sometimes by a difficulty which we find also shattering similar experiments in France, that men were raised to the Committee by their gifts of persuasion rather than their gifts of administration. Well-meaning persons, with a great itch for managing things, and a great turn for bungling them, for whom there is, under the present order of society, a considerable safety-valve in philanthropy, contrive in a socialistic community to get appointed on the Council of Industry, and play sad havoc with the common good. While they preached and wasted, the really practical men who, with better power of talk, might have confounded them, could only sulk and grumble, and eventually lost heart in their work, and all interest and confidence in the concern. This had much to do, according to Mr. Meeker, an old Fourierist, with the ruin of the North American Phalanx, one of the most important of the transatlantic experiments, and it was the main cause apparently of the downfall of the community of Coxsackie—"They had many persons engaged in talking and law-making who did not work at any useful employment; the consequences were that after struggling on for between one and two years the experiment came to an end." A socialist State would probably have as many difficulties with this bustling but unsatisfactory class of persons as a socialist Phalanx, nor would the evils of divided counsels and departmental delays be a whit milder; and the extension of State management to branches of work for which it had not otherwise some sort of special natural qualification would have the same kind of ruinous operation.

In spirit and effect, therefore, as may be palpably seen from these actual experiments, the equalizing institutions of socialism stand quite apart from the very restricted use of State management and the remedial or invigorating legislation that a sound social policy prescribes. When England is accused of heading the nations in the race of State socialism, because England has nationalized the post and telegraph service, and passed a series of factory and agrarian Acts for the protection of the weaker classes of the people, the accusation is made without proper discrimination. It is not the frequency of the intervention, but its purpose and consequences that make it socialistic. If the post is better managed by the State than by private initiative, if the factory and agrarian laws merely reinstate weaker classes in the conditions essential for a normal human life, and neither seek nor produce that equalization of the differences of fortune or skill which is fatal to any high and progressive general level of comfort, then there is no State socialism in it at all. State management is not pushed beyond the limit of efficiency, nor popular rights beyond the positive claims of social justice. Let us go a little further into detail.

 

IV. State Socialism and State Management.

What are the conditions of efficient State administration? The State possesses several natural characteristics which give it a decided advantage as an industrial manager, some for one branch of work, some for another. It has stability, it has permanency, and it has—what is perhaps its principal industrial superiority—unrivalled power of securing unity of administration, since it is the only agency that can use force for the purpose. On the other hand, it has one great natural defect, its want of a personal stake in the produce of the business it conducts, its want of that keen check on waste and that pushing incentive to exertion which private undertakings enjoy in the eye and energy of the master. This is the great taproot from which all the usual faults of Government management spring—its routine, red-tape spirit, its sluggishness in noting changes in the market, in adapting itself to changes in the public taste, and in introducing improved methods of production. Government servants may very generally be men of a higher stamp and training than the servants of a private company, but they are proverbial, on the one hand, for a certain lofty disdain of the humble but valuable virtue of parsimony, and, on the other, for an unprogressive, unenterprising, uninventive administration of business.

Now the branches of industry which the State is fitted to carry on are of course those in which its great fault happens to have small scope for play, and in which its great merit or merits have great scope for play; those, for example, which gain largely in efficiency or economy by a centralized administration, and suffer little harm comparatively from a routine one. That is the reason Governments always manage the postal service well. In post-office work the specific industrial superiority of Government carries its maximum of advantage, and its specific industrial defect does its minimum of injury. The carrying and delivery of letters from one part of the empire to another require, for efficiency, a single co-ordinated system, and, on the other hand, those operations themselves are of so unvariable and routine a character that little harm is done by their being carried on in a routine spirit; they involve so little capital expenditure—the entire capital of the department in England is only £80,000—that the opportunity for waste and corruption is slight; and being conducted much more largely under the public eye than the affairs of other departments of State, they are consequently subject to the constant and interested criticism of the people whose wants they are meant to satisfy. The same reason explains why Government dockyards and arms factories are always managed so unsatisfactorily. There is, on the one hand, no need in them for any higher unity of administration than is wanted in any ordinary single business establishment; but, on the other, progressiveness and adaptability are of the first moment, routine and obstruction to improvement being indeed among their worst dangers. Then the risk of prodigality and corruption is high, for their capital expenditure is great, and the check of public criticism very distant and ineffectual. So exceptional a business is the post, that the telegraphs, though managed by the same department, have never been managed with the same success. They were bought at first at a ransom, they have involved an increasing loss nearly ever since, and the public have to pay practically as much for their telegrams—perhaps more—than the public of the United States pay to their telegraph companies. Even in the postal department, Government administration shows the usual official slowness in adopting much-needed and even lucrative reforms. Of this, a good example occurred only the other day. It was not until a Boys' Messenger Company was already in the field and doing the work, that the Postmaster-General was brought to recognise, as he said, "the desirability of providing a more rapid means of transmitting single letters for short distances and under special circumstances than at present exists."

It ought of course to be acknowledged that State management in England is tried under the very worst possible conditions, inasmuch as it is tied to the fortunes and exigencies of political party. No business could be expected to thrive where the supreme control is placed in the hands of a good parliamentary debater, who knows nothing about the special work of the department he undertakes; where, even at that, this inexperienced hand is changed for another inexperienced hand every three or four years; where policy shifts without continuity, to dodge the popular breeze of to-day, or to catch the popular breeze of to-morrow; and where the actual incumbent of office, is always able to evade censure by throwing the responsibility on his predecessors, who are out of office. Well may a sagacious man like Mr. Samuel Laing, with large experience of administration both in the affairs of State and of private companies, exclaim: "I often think what the result would be if the railway companies managed their affairs on the same principles as the nation applies to its naval and military expenditure. Suppose the Brighton Board were turned out every three years, and a new Board came in with new views and a new policy, and new men at the head of the locomotive, traffic, and other spending departments, how long would it be before expenses went up and dividends down?" If State management is to succeed—if it is to have fair play—it must be entirely divorced from party fortunes, while subject, of course, to the criticism of Parliament, under some system like that adopted in Victoria for the management of the railways. In such circumstances the question of the advisability of Government assuming the management of any industry, is a question of balancing the probable gains from the greater unity of the administration against the probable losses from its greater inertia.

There are some exceptional branches of industry in which Government does better than private persons, because private persons have too little interest to do the work well, or even to do it at all, and there are others in which the State's very want of personal interest is its advantage instead of its drawback. Forestry is the best example of the first sort. One generation must plant, and another cut down, so that the present owner is often unwilling to incur the expense of a speculation of which he is unlikely to live to reap the fruits; but the natural permanence of the State leads it to do more justice to this important branch of production, and experience everywhere shows that State forests are more productive than private ones. In Prussia and Belgium they are nearly twice as productive. The average annual produce of all forests in Prussia (including State forests) is 0.36 thaler per Morgen, but the produce of State forests alone is 0.66 thaler per Morgen. In Belgium the produce of all forests is 19.33 francs per hectare, and of State forests 34.42 francs.[9] The erection of lighthouses is also a public service, which falls to the State because of individual inability; it cannot be undertaken in any way to make it remunerative to private adventurers.

The best example of an industrial work for which the State's want of personal interest is its advantage is the Mint. Nobody would trust the stamp of a private assayer as he trusts the stamp of the Government, because the private assayer could never succeed in placing his personal disinterestedness so absolutely above the suspicion of fraud. The policy of the official attestation of the quality of commodities is often disputed on the ground that it discourages improvement above the pass standard, but it is never doubted that if a brand is wanted, the brand to command most confidence is the brand of the Crown. Our own Government, out of the infinity of commodities offered for sale, attests none but six—butter, herrings, plate, gun barrels, chains, and anchors—articles in which the dangers of deterioration probably exceed the chances of improvement, and in the case of some of these six there is a strong feeling abroad that the State's intervention is doing more harm than good. Scotch herrings have suffered lately in the German markets, because they were worse cured than the Norwegian, and the herring brand was blamed for the unprogressiveness of the cure. This class of interventions, therefore, is neither numerous now, nor likely to become very numerous in the future.

A more important class of undertakings in which the State's industrial advantage lies in its superiority to the temptations of self-interest, is that of industries which naturally assume something of the character of a monopoly, and in which self-interest lacks both the check on its rapacity, and the spur to its activity supplied by effective competition. It is true of more things than railways that when combination is possible, competition is impossible, and the growth of syndicates, trusts and pooling arrangements at the present day has led to considerable agitation for State interference, especially in the case of commodities like salt and coal, which are necessaries of life. Our experience of these things is as yet limited, but so far as it has gone it seems to show that the public dangers dreaded from them are apt to be exaggerated. The combinations fear to raise the price to the public so high as to provoke competition, and in most cases in America have not raised it at all, drawing their advantage rather from the reduction in expense of management, and the saving of capital; and the State would not be likely to manage industries producing for the markets any better than, or even so well as, the more keenly interested board of private directors. But if the balance of evidence seems against public management in this class of monopolies, it stands, I think, decidedly in favour of public management in another and not unimportant class. The gas and water supply of towns is a monopoly, and though the point is not undisputed, it appears to answer better on the whole in public than in private hands, because the management has no interest to serve except the interest of the public. Experience has not been everywhere the same, but usually it has been that under municipal control the quality of the gas has been improved and the price reduced. But this is municipal management of course, not State management, and the difference is material, inasmuch as municipal management, in the case of gas and water supply, is the management of the production of things of general consumption under the direct control of the very people who consume them, so that it is constantly exposed to effective public criticism, perhaps as good a substitute as things admit of for the eye of the master. The natural defect of public management is so mitigated by this circumstance, that probably of all forms of public management, municipal management is the best, and when applied to branches of production that tend to become monopolies at any rate, it answers well. The question is entirely different with proposals that are sometimes made for converting into municipal monopolies branches of production—such, for example, as the bread supply of the community—which are carried on by individual management under effective competition. To do as well as joint-stock management uncontrolled by competition is one thing; to do as well as individual management subject to competition is another; and so long as public management replaces nothing but the former class of enterprises, which are in any case a sort of natural monopolies, it will never contract the vast field of individual enterprise to any very serious extent.

When we pass from municipal monopolies to State monopolies, the problem becomes more grave. The two largest current proposals of this kind are those of land nationalization and railway nationalization. The former proposal, though much more noisily advocated than the other, has incomparably the weaker case. For apart altogether from the mischief of making every rent settlement a political question, and looking at the matter merely in its economic aspect, land, of all things, is that which is least suited for centralized administration, and yields its best results under the minute concentrated supervision of individual and occupying ownership. The magic of property is now a proverbial phrase; it is truer of land than anything else, and it merely means that for land interested administration is everything, comprehensive administration nothing, that the zeal of the resident owner to improve his own land knows no limit, whereas the obstructive forces of routine and official inertia have nowhere more power to blight than in land management. In Adam Smith's time, as he mentions in the "Wealth of Nations," the Crown lands were everywhere the least productive lands in their respective countries, and the experience is the same still. It is so even in Prussia, in spite of its economical and skilled bureaucracy. Professor Roscher says it is a common remark in Germany that Crown lands sell for a greater number of years' purchase than other lands, because they are known to be less improved, and are therefore expected to yield better results to the energy of the purchaser, and he quotes official figures for 1857, showing that the domain land of Prussia had not risen in value so much as the other land in the country. Great expectations are often entertained from the unearned increment, though there is not likely to be much of that in agricultural land for years to come; but what is a much more important consideration for the community is the earned increment, and under State management the earned increment would infallibly decline. Of course, this does not exclude the necessity of strict State control, so far as required by justice, humanity, and the growth and comfort of the general community. Under land nationalization here I have not considered schemes which do not give the State any real ownership in the land more than it at present enjoys, or, at any rate, place no real management of the land in its hands. The rival schemes of Mr. A. R. Wallace and Mr. Henry George are really only more or less objectionable methods of increasing the land-tax.

The question of a State railway is not so easily determined. There are certainly few branches of business where unity of administration is more advantageous, or where the public would benefit more from affairs being conducted from the public point of view of developing the greatest amount of gross traffic, instead of from the private point of view of making the greatest amount of net profit. A railway differs from other enterprises, because it affects all others very seriously for good or ill; it may for the sake of more profit give preferences that are hurtful to industrial development, or deny facilities that are essential to it. A private company may find it more profitable to carry a less quantity at a high rate than a greater quantity at a low, and it cannot be expected to run a line that does not pay, though the general community might benefit greatly more by the increase of traffic which the line creates than covers the loss incurred by running it. Now it is impossible to exaggerate the importance of having a public work like a railway, which can help or hinder every trade in the land, conducted from a public point of view instead of a private, and the present discussion in this country on rates and fares points to the desirability of changes to which private companies are not likely to resort of their own accord, nor the railway commission to be able to compel them. But, on the other hand, it is equally impossible to exaggerate the risks of the undertaking. The post office, with its capital of £80,000, is a plaything to the railways with their capital of £800,000,000, and their revenue little short of that of the State itself. The operations are of a most varied nature, and only some of them could be exposed to effective criticism. The mere transaction of purchase excites in many minds a not unreasonable fear. If Government made a bad bargain with the telegraph companies, it would be sure to make a worse with the railway companies, who are fifty times more powerful; and besides, it would very likely have to borrow its money at a higher figure, for though it could borrow two millions at 3 per cent., it could not therefore borrow eight hundred millions, for the simple reason that the number of people who want 3 per cent. is limited, most holders of stock preferring investments which, though more risky, offer a prospect of more gain. If in trying to balance these weighty pros and equally weighty cons one turns to the experience of State railways, he will find that as yet it affords few very sure or decisive data, because it varies in the different countries and times, and has been very differently interpreted.

Of the Continental State railways, those of Belgium and Germany are usually counted the most favourable examples. But Mr. Hadley, in his excellent work on Railway Transportation, shows that the State lines of Belgium were conducted in an extremely slovenly, perfunctory way until 1853, when private lines began to increase and compete with them, and that though the low rates which this competition was the means of introducing still remain after the private lines have been largely bought out, there has been, on the other hand, latterly a decline in the profits of the State system, an increasing tendency to slackness and inertia in the management, and growing complaints of creating posts to reward political services, and manipulating accounts to suit Government exigencies. In Germany the rates are certainly low and the management economical, but complaints are made that less is done for the encouragement of the national resources, and unprofitable traffic is more severely declined than by the private railways. On the whole, probably the best State railway system is that of Victoria; charging low rates, self-supporting, offering every encouragement to industrial development; and the opinion of England will probably be largely determined by further observation of that experiment.

The sister colony of New Zealand has made a successful experiment in another department of industrial enterprise, life insurance, for which Government management indeed is highly adapted, because, in the first place, it is a business in which absolute security is of the last consequence, and there is no security like Government guarantee; and in the second, it is a business in which the calculations of the whole administration are virtually matters of mechanical routine. The Government office was only opened in 1871, under the influence of a widespread distrust of private offices, caused by recent bankruptcies, and it now transacts one-third of the life insurance business of the colony; it has probably tended to encourage life insurance, for while there are only 26 policies per 1000 of population in the United Kingdom, there are 80 per 1000 in New Zealand, and its management is much cheaper than that of any other insurance company in the colony, except the Australian United. The proportion of expenses to revenue in the Australian United is 13.66 per cent., in the Government Office 17.23, and in none of the other companies (whose gross business, however, is much smaller) is it under 43.02.

Adam Smith thought there were only four branches of enterprise which were fitted to be profitably conducted by a joint-stock company. We have seen in our day almost every branch of industry conducted by such companies, and an idea is often expressed that whatever a joint-stock company can do, Government can do at least quite as well, because the defect of both is the same. The defect is the same, but Government has it in larger measure. Joint-stock management is certainly much less productive in most industries than private management. The Report of the Massachusetts Labour Bureau for 1878 contains some curious statistics on the subject. There were then in the Commonwealth of Massachusetts, 10,395 private manufacturing establishments, employing in all 166,588 persons, and 520 joint-stock manufacturing establishments, employing 101,337 persons, and the private establishments, while they paid a much higher average rate of wages than the joint-stock, produced at the same time not far from twice as much for the capital invested. The average wages per head in the private establishments was 474.37 dollars a year, and in the joint-stock was 383.47 dollars a year; while the produce per dollar of capital was 2.58 dollars' worth in the private, and 1.37 dollars' worth in the joint-stock, and though part of this difference is attributed to the circumstance that private manufacturers sometimes hire their factories and companies do not, the substance of it is believed to be due to the inferiority of the joint-stock management. Anyhow, that circumstance could have no influence in producing the very marked difference in the wages given by the two classes of enterprise, and the higher wages would not, and could not, be given unless the production was higher. If all the industries of the country, then, were put under joint-stock management, the result would be (1) a general reduction in the amount produced, and (2) a consequent reduction in the general remuneration of the working classes, and the general level of natural comfort; and the result would be still worse under universal Government management. One of the labourer's greatest interests is efficient management, and if he suffers from the replacement of individual employers by joint-stock companies, he would suffer much more by the replacement of both by the State, excepting only in those few departments of business for which the State happens to possess peculiar advantages and aptitude.

 

V. State Socialism and Popular Right.

The limits of the legitimate intervention of the public authority with respect to the moral development of the community are prescribed by a different rule from those with respect to its material development. Efficiency is still, indeed, a governing consideration, for perhaps more measures for popular improvement fail from sheer ineffectuality than from any other reason. The history of social reform is strewn thick with these dead-letter measures. There is a cry and a lamentation, and a feeling that something must be done; and an Act of Parliament is passed containing injunctions which no Act of Parliament can enforce, or which address themselves to mere accidental circumstances, and leave the real causes of the evil entirely unaffected. And there would be no impropriety in describing impracticable or ill-directed legislation of this kind as being socialistic, for, besides the old association of socialism with impracticable schemes, impracticable legislation is always unjust legislation, and unjust legislation for behoof of the labouring class is essentially socialistic. Every State interference necessarily involves a certain restriction of the liberty or other general rights of some class of persons; and although this restriction would be perfectly justifiable if it actually secured the prior or more urgent right of another and perhaps much more numerous class of persons, it is injustice, and nothing but injustice, when it merely hurts the former class without doing any good to the latter. It may hurt both classes even—well-meaning meddling often does; but what I desire to bring out here is that labour legislation, which may have been entirely just and free from socialism in its intention, may be unjust and full of socialism in its result. We may therefore, without any fault, include under the head of State socialism that common sort of proposal which, without urging any wrong claim, merely asks the State to do the wrong thing—to do either something it cannot do at all, or something that will not answer the purpose intended. It is socialistic not because it is impracticable, but because it is unjust.

Since well-meant legislation may thus become urgent, and therefore socialistic for want of result, it is plain that the efficiency of the intervention is a very important consideration in determining the State's duty with respect to popular rights. But the primary consideration here is the extent of the moral claim which the individual, by reason of his weakness, has upon the resources of society, and it is upon that consideration that the division of conflicting political theories on the subject turns. All the several theories are agreed that the enlargement of popular rights, when the enlargement is required by a just popular claim, is entirely within the proper and natural province of the State; where they differ, and differ seriously, is partly in their views of the justice of particular elements in the popular claim of the time being, but more especially in their whole conception of the nature and extent of the popular claim in general. There are still some persons to be found contending that there are no such things as natural rights, and there are plenty who cannot hear the words without a sensation of alarm. But it is now generally admitted, even by those who adopt the narrowest political theories, that legal rights are merely the ratification of moral rights already existing, and that the creation of new legal rights for securing the just aspirations of ill-protected classes of the people belongs to the ordinary daily duties of all civil government. Mr. Spencer very readily admits that some of the latest constituted rights in this country—the new seamen's right of the Merchant Shipping Act, and the new women's right of the Married Women's Property Act—are perfectly justifiable for the prevention in the one case of seamen being fraudulently betrayed into unseaworthy ships, and in the other of women being robbed of their own personal earnings. But then the new rights which he would most condemn—the right to public assistance, the right to education, the right to a habitable dwelling, the right to a fair rent—are quite as susceptible of justification on the ground of natural justice as either the right to a seaworthy ship or the right to one's own earnings. Mr. Spencer's theory errs by unduly contracting men's natural claim. They have a right to more than equal freedom; they have a right, to use Smith's phrase, to an undeformed and unmutilated humanity, to that original basis of human dignity which it is the business of organized society to defend for its weaker members against the assaults of fortune as well as the assaults of men. That is what I have called, for the sake of distinction, the English theory of social politics. On the other hand, socialism unduly extends this claim. The right to fair wages is one thing; the State could not realize it, but it at least represents no unjust aspiration; but the right to an equal dividend of the national income, claimed by utopian socialists, including Mr. Bellamy at the present day, and the right to the full produce of labour claimed by the revolutionary socialists, and meaning, as explained by them, the right to the entire product of labour and capital together, are really rights to unfair wages, and the whole objection to them is that they are at variance with social justice. If we keep these distinctions in view, we shall be able to discriminate between interventions of authority which are innocent, and interventions which are tainted with State socialism. Take an illustration or two, 1st, of interventions for settling the claims of the poor in society in general, and 2nd, of interventions for adjusting the differences between one class and another, between employer and labourer, between landlord and tenant, and the like.

1. Under the first head, the most important question is the question of public assistance. Prince Bismarck created a considerable European sensation when he first announced his new social policy in 1884, by declaring in favour of the three claims of labour, which have been so commonly regarded as the very alpha and omega of social revolution—the right to existence for the infirm, the right to labour for the able-bodied, and the right to superannuation for the aged. "Give the labourer," he said, "the right to labour when he is able-bodied; give him the right to relief when he is sick; give him the right to maintenance when he is old; and if you do so—if you do not shrink from the sacrifice, and do not cry out about State socialism whenever the State does anything for the labourer in the way of Christian charity—then I believe you will destroy the charm of the Wyden (i.e., Social Democratic) programme." These three rights are really two, the right of relief when one is sick and of maintenance when one is old being only different phases of the right to existence. Now the right to existence and the right to labour are in themselves both perfectly just claims, but the construction Prince Bismarck gave them passed decidedly over into State socialism.

The right to existence is seldom called in question. Malthus, it is true, said a man had a right to live only as he had a right to live a hundred years—if he could. He might as well have argued that a man had a right to escape murder only as he had a right to escape murder for a hundred years—if he could. It is really because he cannot that he has the right—it is because he cannot protect himself against violence that he has a right to protection from the State, and because, and as far as, he cannot protect himself against starvation that he has a just claim upon the State for food. And his claim is obviously bounded in the one case as in the other by the ability of society. If society cannot protect him, it is of course absurd to talk of any right to its protection, but if society can, society ought. To suffer a fellow-citizen to die of hunger is felt by a civilized community to be at least as just a disgrace to its government as it would be to leave him a prey to the knife of the assassin, or to the incursions of marauders from over the enemy's border. But as the State furnishes protection against human violence by its courts of justice, and against disease by its sanitary laws, so it furnishes protection against famine and indigence by its legal provision of relief. The claim of the perishing stands on the same footing as any other claim which is an admitted right of man to-day; it is a claim to an essential condition of normal manhood—to existence itself. But then, if the right to existence must be admitted, it can only be admitted where the individual is, for whatever reason, unable to make provision for himself, and it can only be admitted in such measure and form as will not discourage other individuals from trying to make independent provision for themselves before their day of disability comes, because that, in turn, is the way prescribed by normal manhood and true human dignity.

What State socialists claim, however, is not the right to existence, but the right to decent and comfortable existence—the right to the style of living which is customary among the independent poor. The labourer ought, in their eyes, to be treated as a public servant, and his sick pay and his pension ought both to be commensurate with the claims and dignity of honest labour. Now it is of course impossible not to sympathize much with this view, but the difficulty is that if you make assisted labour as good as independent labour, you shall soon have more assisted labour than you can manage, you shall have weakened the push, energy, and forethought of your labouring class, you shall have really done much to destroy that very dignity of labour which you desire to establish. The State may probably, with great advantage, do more for working-class insurance than it at present does. It could conduct the business of the burial benefit and the superannuation benefit better than any private company or friendly society, because it could offer a surer guarantee and the business is routine; Mr. Gladstone's excellent annuity scheme has remained sterile only because it has not been pushed, and the canvasser and collector are indispensable in working-class insurance. But the socialist proposal is that the State ought to give every man a pension after a certain age, irrespectively altogether of his own contributions. Mr. Webb is one of its most recent advocates, and, according to the useful figures he has taken the trouble to obtain, there are in the United Kingdom 1,700,000 persons over sixty-five years of age, of whom 1,300,000 contrive to pension themselves, either by their own savings or the assistance of their families, while the remaining 400,000 are supported by the rates at an average cost of ten guineas a year. Mr. Webb's proposal is that in order to save the feelings of the 400,000 dependants you are to make the other 1,300,000 persons dependants along with them, and give ten guineas a year all round. But you cannot make a public dole a pension by merely calling it a pension. A pension is a payment made by one's actual employer for work done—it is wages, and the man who has earned his own pension, or has provided it by his own saving, feels himself and is an independent man. It is right to maintain the 400,000—whether out of national or parochial funds is a detail—but sound policy would rather aim at raising the 400,000 to be as the 1,300,000, than at lowering the 1,300,000 to the level of the 400,000. With Mr. Webb it is not a question of giving the 400,000 better allowances than they receive at present—which might be most reasonably entertained—but it is a mere question of not suffering them to be looked down on by the 1,300,000 who have fought their own way, and that is not possible, nor, with all respect for them, is it, from a public point of view, desirable. It is right to support those who cannot support themselves, but it is neither right nor wise to remove all distinction between the dependent poor and the independent.

But the line between State socialism and sound social politics in the matter of public assistance may perhaps be better shown in another branch of Poor Law administration—the right to labour for the able-bodied. The socialist right to labour is the right of the unemployed to get labour in their own trades and at good or current rates of wages. That is the right which Bismarck substantially admitted in his famous speech. He said there was a crowd of suitable undertakings which the State could establish to furnish the unemployed with a fair day's wage for a fair day's work. It is also practically the right which prevailed in England between 1782, when Gilbert's Act abolished the old workhouse test, and 1835, when the new Poor Law restored it. Gilbert's Act gave the able-bodied poor the right (1) to obtain from the guardians work near their own residence and suited to their respective strength and capacity; (2) to receive for their labour all the money earned by it; and (3) if that sum fell short of their requirements, to have the difference made up out of the parochial funds. The effect of that, as we know, was, that public relief became too desirable, the dependants on it multiplied, the poor rate rose, the wages of labour fell, the very efficiency of the labourer himself withered, and the new Poor Law reverted to the workhouse test, which, harsh though it was considered to be, was in reality a necessary defence of the character and comfort of the labouring class from further decadence.

To provide the unemployed with work in their own trades is only to increase the evil you wish to remedy, for the very existence of the unemployed shows that those particular trades are slack at the time, that there is no demand for the articles they produce, and consequently any attempt by the State to throw fresh supplies of these articles on the already over-stocked market can have no other effect than to increase the depression and turn out of employ the men that are still at work. Paying relief work at the common market rate of wages is attended with the same objection. The remedy only aggravates the disease, and what ought to be merely the labourer's temporary resource against adversity tends to grow into his regular staff of life. Relief wages, while sufficient for the family's support, should remain below the current rates so as to give the labourer an effective inducement to seek better employment as soon as better employment can possibly be obtained. The true and natural defence against misfortune is the man's own personal exertion and provision, and the purpose of the public intervention is to stimulate and assist, not to supplant, that vis medicatrix naturæ.

But under these limitations a right to labour is a just claim of the unfortunate. It is admitted in the English Poor Law, and it is admitted in the Scotch parochial practice, which constructively considers want of employment a form of sickness or accident, and it requires in both countries to be better realized than it is. 1st: although it is unadvisable to give every man work at his own trade, and although the choice of trades for relief purposes is attended with as much difficulty as the choice of those for prison labour is found to be, yet certainly the circle of relief trades ought to be extended beyond stone-breaking and oakum-picking. Socialists themselves are among the foremost in complaining of the competition of prison labour with honest labour, although they fail to see that precisely the same objection attends the competition of relieved labor in public workshops with unrelieved labour in regular private employment. The kind of work most free from objection on this score would probably be the production of articles now imported from abroad, and there are a great many trades in which, while we make most of their products at home, we import particular articles or sorts of articles for one reason or another. Some of these might be found suitable for the purpose in view. Or the men in the public workshops might be employed in making a variety of things used in public offices, imperial or local. 2nd: what is even more important, a distinction ought to be made between the industrious poor and that residuum of confirmed failures for whom the stoneyard test is really intended, and the former ought not to be made to feel themselves any way degraded in their work, their small remuneration being trusted to act as a sufficient preventive against their permanent dependence on the public for employment. 3rd: then a third and most important requisite is to supplement the public provision of work with a public provision of information about the demand for labour over the country from day to day, so as not merely to support the men in adversity, but to facilitate their restoration to their normal condition of prosperity.

For we ought to recognise that though the problem of the unemployed is not, as many persons imagine, one of increasing gravity in our time—although, on the contrary, if we go back thirty years, sixty years, or a hundred years, we always find worse complaints and more distressing sufferings from that cause than at present, yet it is certainly a constant problem. The unemployed we have always with us, and even their numbers vary less from time to time than we are apt to suppose. Trades dependent on fine weather are, of course, slack in winter, but then trades dependent on fashion are slack in summer, while there are some large trades—such as the shoemakers—that are made brisk by bad weather. Even a general commercial crisis which throws the workpeople of many trades idle, makes those of others busy. The building trades are always busy in bad times, because money and labour are then cheap, and the opportunity is seized of building or extending factories, and laying down plant of every description. It was so to a very remarkable extent during the Lancashire cotton distress of 1862; it was so all over England in the depression of 1877-78, and the same fact was observed again in Scotland, and commented upon by the factory inspector in 1886. Other trades are brisker in a crisis for less happy causes, e.g., the bakers for the melancholy reason that the working classes are more generally driven from meat to bread. These natural corrections or compensations elicited by the depression itself prevent the numbers of the unemployed from growing so very much larger in a crisis than in ordinary times that their case would not be overtaken satisfactorily by the general systematic provision of relief work, if that were once established. The excess is met now so effectually by a few special local efforts, that we have sometimes far fewer able-bodied paupers in bad years than in good. The number of able-bodied paupers was very much less in the bad years 1876-1878 than in the good years immediately after them, or in the still better years immediately before them. The problem being, then, so largely constant from season to season, and from cycle to cycle, ought clearly to be solved by a permanent and systematic provision.

The same principle which governs this right to labour—the principle of preventing degradation and facilitating self-recovery—governs other social legislation for the unfortunate besides the Poor Law. It lies at the bottom of the homestead exemptions of America, and our own prohibition of arrestment of tools and wages for debt, and our occasional measures for cancelling arrears. It is the principle laid down by Pitt when he said that no temporary occasion should be suffered to force a British subject to part with his last shilling. He had a right to his last shilling, because he had a right to an undegraded humanity. The last shilling stopped his fall, and perhaps helped him to rise again.

Many persons will admit the right to public assistance, because it seems limited to saving men from extremities, who will see nothing but socialism of a perilous sort in other public provisions, for which popular claims are advanced. Schools, museums, libraries, parks, open spaces, footpaths, baths, are certainly means of intellectual and physical life, which keep the manhood of a community in normal vigour; but, it will be asked, if the State once begins to supply such things, where is it to stop? Is free education to go beyond the primary branches? What length are you to go? is the question Mr. Spencer always raises as a bar to your going at all. But the same question of degree can be raised about everything, about the duties Mr. Spencer himself imposes upon the State as really as about those he refuses to sanction. In the matter of protection, for instance, how many policemen are we required to detail to a district? Or how great an army and navy are we to maintain? During the excitement about the Jack the Ripper murders there was much clamour about the police being too few, and we are subject to periodical panics as to our imperial defences, in the course of which no two persons agree in answering the question, what length are we to go? The question can only be settled of course by measuring the length of our necessities with the length of our purse, and the same class of considerations rules in the other case, the importance and cost of the given provision to a community of such education and culture, together with the impossibility of getting it adequately supplied without public agency. The opinion of the time may vary as to what is essential for a whole and wholesome manhood, and its resources may vary as to what may be easily borne to supply it; but the same variation takes place with respect to the duties of national defence, or the administration of justice. The objection is therefore nothing more or less than the very ancient and famous logical fallacy with which the Greek sophists used to nonplus their antagonists. As in other affairs, the problem so far will settle itself practically as it goes along, and the important distinction to bear in mind is that to give every man the essential conditions of all humane living is a very different kind of aim from giving every man the same share in the national production, or a lien on his neighbour's luck or industry or alertness.

2. From rights realizing general claims of the unfortunate on society at large, let us now pass to rights realizing special claims of certain weaker classes of society against certain stronger classes. The most typical examples of this sort of legislation are the intervention of the State between buyer and seller, between landlord and tenant, between employer and labourer, for the judicial determination of a fair price, a fair rent, or fair wages, or for the regulation of the conditions of labour, and tenure of land. Professor Sidgwick declares the Irish and Scotch Land Acts, which provide for the judicial determination of a fair rent, to be the most distinctively socialistic measures the English Legislature has yet passed; but in reality these Land Acts are not a bit more socialistic than the laws which fix a fair price for railway rates and fares, and much less socialistic than the old usury Acts which sought to determine fair interest. Such interferences with freedom of contract as these are, of course, only justifiable when the absence of effective competition places the real power of settlement of terms practically in the hands of one side alone, and conduces, therefore, inevitably to the serious injury and oppression of the other. Parliament controls railway charges because the railway companies enjoy a monopoly of most important business, and might use their monopoly to wrong the public, and when Parliament is asked, as it sometimes is, to discourage corners, rings, syndicates, or pooling combinations, it is on the ground that these various agencies are attempts, more or less successful, to exclude competition for the purpose of exacting from the public more than a fair price. On the other hand, the reason why we have given up fixing fair interest now is because we have come to see that competition, being very effective among money-lenders, fixes it far better for us without the intervention of the law, and, of course, an unnecessary interference with freedom of contract is nothing but pernicious. But, although for ordinary commercial loans the competition of lenders is a sufficient security for the fair treatment of borrowers, it affords no protection against extortion to the very necessitous man, who must accept any terms or starve. His poverty leaves him no proper freedom to make a contract, and the law still condemns oppressive rates of usury, to which, as the Apothecary says in "Romeo and Juliet," the poor man's poverty, but not his will, consents. In such a case, accordingly, an authoritative prescription of fair interest is only a necessary requirement of justice and humanity.

The public determination of fair rent stands on precisely the same ground. The rent of large farms, like the interest on ordinary commercial loans, may be safely left to be settled by commercial competition, because large farms are taken by men of capital as a business speculation, and landlords cannot exact more rent than the farms will bear without driving capital out of agriculture into other branches of production, and so reducing the demand for that class of farms to an extent that will bring the rent down to its proper level again. But the rent of small holdings, like the interest on loans to persons in extremity, is ruled by other considerations. Cottier tenants, between their numbers and their necessities, are continually driven into offering rents the land can never be made to pay, and thereby incurring for the rest of their days the burden of a lengthening chain of arrears little better than Oriental debt-slavery. Other work is hard to find; the land being limited in supply is a natural monopoly; and the State merely steps in to save the tenantry from the injurious effects of their own over-competition for an essential instrument of their labour, and, through their labour, of their very existence. The interference, therefore, is perfectly justifiable if the machinery it institutes can carry out the purpose efficiently, and there is this difference between a court for fixing rent and a court for fixing the price of bread, or beer, or labour, that it is only doing work which in the natural course of things is very usually done by periodical and independent valuation, instead of by the ordinary higgling of the market. It has always been the custom on many large estates to call in a valuator from the outside for the revision of the rents, and a valuator appointed by the Crown cannot be expected to do the work any less effectively than a valuator appointed by the landlord. Moreover, the tendency of opinion seems to be towards the simplication of the process by some self-working scheme, a sliding scale for apportioning an annual rent to the annual production.

State intervention in the determination of the rate of wages is often proposed either for the purpose of settling trade disputes on the subject, or for the purpose of suppressing what is called starvation wages and fixing a legal minimum rate. As for arbitration in trade disputes, the object is, of course, in no way socialistic, for it is strictly allied with the ordinary judicial work of the State, and a public and permanent tribunal would probably answer the purpose much better than a private and merely occasional one; for even although it might not be able to enforce its judgments in all cases by compulsion on the parties, it would be more likely than the other to command their confidence and secure by its moral authority their voluntary submission, and this authority would increase with the experience of the court.

In certain cases compulsory arbitration seems to be required. There are trades in which the public interest may require strikes to be prohibited, in order to prevent a whole community suffering grave privations, perhaps being starved of its supply of a necessary of life. The Trades Union Act imposes express restrictions on combinations among the labourers at gas and water works, and the recent railway strike in Scotland, which not only paralyzed trade for a time, but stopped the supply of coal to whole districts in the middle of the severest winter of the last part of the century, suggested to many minds the propriety of similar interference in railway disputes. But if the State interfered to stop the strike, the State must needs in equity interfere to decide upon the cause of quarrel. And happily these are the very cases which are best fitted for compulsory arbitration, because the trades concerned are not subject to the market fluctuations to which other trades are liable, and are therefore better suited for fixed settlements of definite and considerable duration.

But what socialists claim is a universal determination of normal wages, so as to give every man the full product of his labour, as the full product of his labour is understood upon their theory. For the present, however, they are content to ask for at least the establishment of a legal minimum rate of wages; in fact, an international minimum rate of wages and an international eight hours working day are the two demands on which their agitation is in the meantime most strenuously concentrated. In their recent policy they have reverted to the kind of remedies they used to speak of with such lofty disdain as mere palliatives, and have only preserved their separate identity from other reformers by asking for these palliatives in their least practicable form. An international compulsory minimum wage is impossible, for even a national one is so, and that is the only objection, but a very sufficient one, to the proposal. If you could wipe out starvation wages by passing an Act of Parliament, let the Act be passed to-morrow, for starvation wages is surely the worst and most exasperating of all the enemies of humane living. To starve for want of power to work is bad; to starve for want of work is worse; but to work and yet starve, to work a long, long day without obtaining the bread that should be its natural reward, is a third and worst degree of misfortune, for it mocks the fitness and equity of things, and seizes the mind like a wrong. If it is right to suppress starvation by law, it would seem more right still to suppress starvation wages; and if the socialist contention were in the least true, that in consequence of the "iron and cruel law" all wages are starvation wages, and all work sweaters' work, that work and starve is the inevitable rule under the present system of things, there would be no good answer to their demand for the abolition of the present system of things. But as a matter of fact working and starving is the condition of only exceptional groups of workpeople, and the right to a minimum wage, in the sense of a wage above starvation point, would have no bearing on the great majority of the labouring classes, inasmuch as they stand already on a considerably higher level of remuneration.

Ought the State, however, to fix a legal minimum of wages for the protection of the exceptional groups of workpeople to whose situation such a measure might have relation? The objection to this course comes less from want of justice in the claim than from want of power in the State to realize it. The fixing of a legal minimum rate of wages is a task which it is beyond the State's power to accomplish, except by paying up the minimum out of its own funds; for, though the law fixed a minimum to-morrow, it could not compel employers to engage workmen at that minimum; and if employers found it unprofitable to do so, the only effect of the legislation would be to throw numbers of men out of work, and make their maintenance at the legal minimum an obligation of the public treasury. Of the results of paying wages out of the rates we have had plenty of experience. To suppress starvation wages in this way by direct statute is merely impossible, however, and there would be no taint of socialism in it, if it could be done. Much less can the like objection be made against any milder remedies. The only danger is that they would not prove effectual, and would address themselves to false causes. Take the sweating system of the East End of London, in which, bad conditions of labour always going together, we find starvation wages combined with long hours and unwholesome work-rooms. Two of the favourite remedies are the abolition of sub-contracting and the prohibition of pauper Jewish immigration; but neither of these things is the cause of sweating. The sweating contractor of the East End is not a sub-contractor at all; he is the only contractor in the business, and even if he were a sub-contractor, we know that sub-contractors often pay far better wages than the chief contractor can, because they know their men better, and get better work out of them.

A temporary increase in the Jewish immigration may occasion a temporary aggravation of the difficulty, but the permanent causes lie elsewhere, and even in the way of aggravation a matter of a thousand Jews more, or a thousand Jews less, cannot play an all-important part in a system affecting some hundred thousand workpeople. Sweating is no more incident to Jewish labour than to English labour. The cheap clothing trade of Birmingham is certainly in the hands of Jews, yet sweating is—or at least was when the factory inspector reported in 1879—absolutely unknown. The wages, he said, were good, the hours were not long, and there were no overcrowded dens. On the other hand, sweating has not only been for years endemic in the East End of London, but has even appeared in a very acute form, apart from any alien influence, in the tailoring trade in Melbourne, the paradise of working people, as it is sometimes not unjustly denominated. The sweating there was conducted largely by ladies who took in bands of learners, and, according to the evidence before the Shopkeepers' Commission, of 1883, every second house in some of the suburbs was a shop of that kind. There was an excessive influx of labour into that trade, because little other work could be found for women who entertained, as they do generally in that colony, a prejudice against both factory labour and domestic service. On the other hand, this overflow was diverted in Birmingham into other channels by the comparative abundance of light employments the district afforded. But apart from temporary or local circumstances that serve to aggravate things or alleviate them, the tailor trade is everywhere naturally subject beyond all others to over-competition: (1) because the work can be done at home; (2) because it can be learnt in a few weeks or months well enough to earn starvation wages in a long day at some sorts of work; (3) because it needs as little capital for the contractor to start business as it needs training for the operatives; and (4) because the operatives being scattered about in their own homes, or in small workshops here and there, have a natural difficulty in coming to any concerted action that might otherwise mitigate the effects of the over-competition, and if there is any general remedy for sweating, it must deal with these causes. To replace homework by common work in wholesome workshops, as far as that can be done, might interfere with what some poor persons found a convenient resource, but would do no harm to the working class generally. The work it was less convenient for some to do would be done by others. The change would remove at once one of the evils of sweating—the unhealthy work-places—and it would contribute to remove the others, first by facilitating combination, and second by improving the personal efficiency of the labourer and the amount of his production. Dr. Watts, of Manchester, speaking from long experience, tells us in his "Facts of the Cotton Famine" (p. 44) that "men often care more about being employed in a good mill (i.e., a mill with plenty of room, air, and light) than about the exact price per pound for spinning, or per piece for weaving, for they know practically what is the effect of these conditions upon the weekly wages." Various measures have been suggested which have some such end in view—the compulsory registration of the contractor's workrooms and his outworkers, the requiring him to provide workshops for all his hands, the joint liability of the clothier with him for the wholesomeness of the workplaces, the erection of public workshops where workpeople may be accommodated for hire; they may be open to various objections—and there is no space to indicate or discuss them here—but if they are effectual for the purpose contemplated, that purpose saves them at least from the reproach of socialism.

The international compulsory eight hours day is attended with like difficulty. The eight hours day is no necessary plank of socialism, though socialists have at present united to demand it. Rodbertus, the most learned and scientific of modern socialists, always contended that the normal working-day ought not to be of uniform length, but should vary inversely with the relative strain of the several trades, and Mr. Bellamy, under his system of absolute equality of income, makes differences in the hours of labour answer the purpose of regulating the choice of occupation, and preventing too many persons running into the easier trades, and too few into the harder. Nor, indeed, apart from the element of universal compulsion, has the eight hours day anything of socialism in it at all. In some trades it is probably a simple necessity for protecting the workpeople in normal conditions of health; but above all its sanitary benefits it would confer upon the workpeople of every trade alike the much grander blessing of admitting them to a reasonable share of the intellectual, social, domestic, religious, and political life of their time. If the State could bestow upon them this sovereign blessing without forcing them to accept a reduction of wages, which might deprive them of things even more essential for their elevation, and which would only breed among them an intolerable discontent, by all means let the State declare the glad decree. But experience shows that in matters of this kind the State—and especially the democratic State—is a very limited agent, and cannot successfully enforce its decrees upon unwilling trades. In certain special cases, when the short day is demanded for the purpose of averting admitted dangers to health, as with the miners, or for the safety of the public, as with the railway service, there is a recognised stringency of obligation which is exceptional; but in the great run of trades the question is virtually one of mere preference between an hour's leisure and an hour's pay, and in these circumstances a law has too little moral authority behind it to be practically enforceable by penalties in the absence of decided working-class opinion in its favour in the affected trades. In Victoria more than fifty separate trades have obtained the eight hours day without any parliamentary assistance, and almost the only remaining trades which do not yet enjoy it are the very trades which have been protected by an eight hours Factory Act since 1874. As soon as the Act was passed, the operatives, men and women both, petitioned the Chief Secretary for its suspension, and it has remained in suspended animation to this day. A democratic government cannot risk incurring the discontent of a body of the people merely to prevent them from working an hour more when they want to earn a little more. California has had an Eight Hours Act on the statute-book for even a longer period, but it has remained a mere dead letter, because employers began to pay wages by the hour or the piece, and the men found they did not earn so much in the short day as they used to earn in the long. The same thing has happened in others of the American States, and the friends of the eight hours movement in that country are beginning to think that the reason their long and often hot struggle has hitherto been so fruitless is because they have been wasting their strength in political agitation when they ought to have been cultivating and organizing opinion among the working class themselves trade by trade. The weakness of statutory eight hours movements has generally flowed from two sources. One is that what their promoters really wanted was not shorter hours, but more wages. Numbers of them sought only to shorten regular time in order to lengthen overtime, and numbers more got themselves persuaded that a general reduction of hours was the grand means of effecting a general rise of wages, either by removing the competition of the unemployed, or in some other way; and it has often been only the few—always the very élite of labour—who fought for the eight hours day because they valued the leisure enough to make, if necessary, some little sacrifice for so noble a boon. When, therefore, wages, instead of rising, begin to get reduced, general disappointment is inevitable, and they get reduced—and reduced lower than they otherwise might be—through the second weakness of such movements, which is simply this, that a trades union which is not strong enough to get an eight hours day by their own unaided efforts, without the assistance of the law, is not strong enough to prevent their wages from sinking, and in this matter the law can do nothing to help them. The eight hours day can only be an abiding possession if it come through the successive growth of opinion and organization in one trade after another. The history of the movement in Victoria is the history of such successive triumphs of opinion and organization; as soon as a trade has come to want the eight hours day earnestly enough to be willing to sacrifice something for it, the trade has always got it. In the result they have had to sacrifice very little; scarce one of them suffered a fall of wages by the change, for the simple reason that there was no serious fall in their daily production. The difference between the ten hours day and the eight hours day in Victoria was not two hours, but only three-quarters of an hour, for—at least in the important trades—the old day was ten hours, with an hour and a quarter off for meals; and in eight hours with only one break the men probably did near as much as they did before in the eight hours and three-quarters with a double break. Still, most of the trades took twenty or five-and-twenty years before they ventured to join the movement; and though no country in the world is so much under the control of working-class opinion as Victoria, the proposal of a general legal eight hours day which has repeatedly come before the Legislature has never been carried into law.

In one sense the eight hours day is the least socialistic of all reforms proposed in the interest of the working class, for it is impossible to make the other classes of society pay for the boon. It may not, perhaps, be quite certain that there will be anything to pay for it at all, for many people assure us production will suffer nothing by the change, and some promise us it will be even increased. But one thing at least is certain: if there is anything to pay, it is the working classes themselves who in the end will and must pay it. The reduction can make no great difference to employers, except on running contracts, or where for any reason they refuse to keep their plant in use by an extra shift, for in the matter of wages they will do under an eight hours system exactly what they do now—pay the men for the amount of work they get out of them and no more; and as they thus produce their goods at the old cost, they can export them at the old price. It need not, therefore, have any permanent effect worth speaking of on the general trade of the country. But if the men do less, their wages will be less too,[10] and nothing can long keep them what they were. This wages question is the eight hours question; and while it is a question for the men more than for the masters, it is essential they should keep clear of all misconception in deciding it.

There is no way of getting ten hours' pay for eight hours' work except by doing the work of ten hours in the eight. An Eight Hours Act would give working men no new power to raise the rate of wages; and if they cannot by combination get twelve hours' pay for ten hours' work to-day, they cannot by combination get ten hours' pay for eight hours' work to-morrow. It is, indeed, a very current delusion, that a restriction of production must increase wages by necessitating the employment of the unemployed, whose competition tends at present to prevent wages from rising. But that effect could only occur if the same demand for commodities remained, and although that might be the case if the restriction were confined to a single branch of industry, while all the rest continued to produce as much as before, it would not be so if the restriction were carried out simultaneously all round. The various trades are one another's customers; the commodities one supplies constitute the demand for the labour of the others; and if the supply is reduced all round, the demand will be reduced all round. To say there is at any moment a fixed amount of work that has to be done whatever the produce of the labour, is, as Professor Marshall very happily observes, to set up a Work Fund Dogma exactly analogous to the old Wages Fund Doctrine of the schools, and, he might have added, a dogma even more dangerous to the prosperity of the working-man. Yet the idea is abroad; it appears in the trade-union policy of "making work"—that is, making work for to-morrow by not doing it to-day; it is a kind of mercantilist delusion of the present century, by which each trade is to cut some advantage for itself out of the sides of the others until they all come to practise the trick in turn and fall to mysterious ruin together.

If the eight hours day is to raise wages, it will not be by limiting production, but by improving it. That the productivity of labour is capable of improving—nay, that it is certain to improve to such an extent as to earn by-and-by more wages in an eight hours day than it now does in a ten—is scarce matter of doubt. Apart from the influence of machinery and invention, there is a great reserve of personal efficiency, especially in English labour, still capable of development. Mr. Nasmyth, the inventor of the steam-hammer, said that he noticed when watching his men at work, that most of them spent at least two-thirds of their time, not in working, but in criticising their work with the square and the straight-edge, which the few dexterous workmen among them almost never required to use. An increase of dexterity might, therefore, make up for a reduction of the day in these trades even to four hours. But the present question is about the probable effect of the reduction itself upon the efficiency of labour, and experience certainly does not justify those who declare that it would increase the daily product. The effect of a reduction from ten hours or nine to eight is, of course, an entirely different question from the effect of a reduction from twelve or thirteen to ten, because the last two hours' labour in a very long and exhausting day may bear little comparison with the last two hours of a shorter day; and of the exact effect of the particular reduction from ten to eight we possess but scanty evidence, though much might easily be obtained, one would think, from establishments that run, as many do, ten hours in summer and eight hours in winter, or ten hours in busy times and eight hours in slack. We have some American evidence of this sort, but it is very contradictory, a few employers saying that quite as much work was done in the eight hours as in the ten, and others that as much would have been done had the men made a better use of their leisure, while several more complained that the men really did less, and that their energies were positively slackened under the short hours—this also perhaps being a result of the use they made of their leisure. In Victoria the production seems to have been reduced a little, but really so little as to have no very perceptible results, and the leisure is used so well that the working class have made a distinct rise in the scale of being, and have developed a remarkable love of outdoor sports, and spare energy enough to produce some of the most famous cricketers and scullers in the world. There are some trades in which it is possible for production to diminish and yet wages to remain the same, because the difference can be thrown into the price of the product. These are trades supplying a commodity in general and necessary demand of which the consumers will stand a very considerable rise in the price before they will seriously shorten their purchases. Coal is a good example of such a commodity, and the miners are therefore very happily situated for the adoption of an eight hours day. They are more able than most other trades to prevent such a measure from resulting in any fall of wages, and consequently a legal enactment on the subject is less likely with them to create subsequent disappointment, and remain dead letter. They need State help in the matter less than most trades, for they are strong and well organized; but an Eight Hours Act would be more easily enforced among them. Very few trades, however, are in this exceptional position. On the whole, the risk of material loss incurred by the reduction is slight compared with the certainty and greatness of the moral gain; the material loss will, in any case, be soon made up by industrial improvements, if things progress as they are doing; and if the reduction is more likely to come through the union and organization of the trades themselves rather than by either national or international action, the trades at least need have no serious fear to make the venture.

The idea of settling questions of this kind by international action, which was started at first from the side of the employers as a convenient obstructive, but has since been taken up with great zeal by the young German Emperor and the socialists, is obviously delusive. It ignores the possibilities of the case, for who, in the first place, is to adjust the complicated details of this international handicap, and if they were adjusted, who is to enforce them? No country is likely to be very strict in enforcing those parts of the settlement by which it lost some point of advantage, and those are the only parts for which any such settlement was wanted at all. Besides, international labour treaties are quite unnecessary. Experience all over the world shows that a short-hour State suffers nothing in the competition with a long-hour State. When Massachusetts became a ten-hour State, her manufacturers never found themselves at any disadvantage in competing with those of the neighbouring eleven-hour States of New England, and they would have still less to fear from rivals who employed, not the same Anglo-Saxon labour as they did themselves, but the less efficient labour of Germany or France. The ten-hour day was its own reward. It improved the efficiency of the workpeople to the degree where, in concert with improvements in the management, also due to the shortening of the day, the product of ten hours in Massachusetts was equal to the product of eleven elsewhere. If the same result were to follow the adoption of an eight hours day, which, however, has still to be tested by experiment, there is of course no more reason why one country should wait for another in adopting the eight hours day than in adopting the policy of free trade.