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CAUFOR.^IA
LA JOUA, CALIFORNIA
VII
SAN DIEGO
51
ECONOMIC DEMOCRACY
2007
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ECONOMIC DEMOCRACY
BY
MAJOR
C.
H.
DOUGLAS
W.C.
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CONTENTS
PAGE
7
-
19
37
57
CHAPTER FIVE
CHAPTER SIX
73 79
CHAPTER SEVEN
CHAPTER EIGHT
CHAPTER NINE
93
119
129
-
CHAPTER TEN
CHAPTER ELEVEN
-
141
CHAPTER TWELVE
149
FIRST
EDITION
COPY
RIGHT
19
PREFACE
Written
for the
War
conditions,
book
is
an attempt to dis-
we
call
is
now
attacked
and
of
afterwards
to
indicate
the
probable
direction
sound and
vital
reconstruction.
My
its
methods demands
but
matter
to
I
contains
its
has
excuse
presentation
form.
am
indebted to
my
friend
(in
Mr. A. R. Orage,
first
New Age
appeared)
C. H.
DOUGLAS.
CO., LTD.,
Economic Democracy
CHAPTER ONE
THERE
as
it
now so strong
The
constituent
who
human
activity,
and
most particularly so in that of economics, where the tracing back to first principles of the dogmas used for everyday purposes
requires, in addition to
some
little
aptitude
and research, a laborious effort of thought and logic very foreign to our normal methods. It thus comes about that modification
in the creed of the orthodox
is
both
;
difficult
and
conducive
to
exasperation
since
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because the form
for the substance
is
commonly mistaken
not clearly seen
it is
why
may
in course of time
become a
habits
Of such
a character are
many of our
and speech to-day. Because from the commercial policy of the nineteenth
of thought
century
has
quite
clearly
sprung
great
quite honestly in
many
cases,
would
and drain the sea to make a factory. On the other hand the Social Reformer, obsessed as well he might be, with the poverty and degradation which shoulder the very doors
of the rich,
to
is
the
Industrial
Revolution note, or assume, that the conditions he deplores did not exist then, at
any
rate,
in so desperate a degree
all
and
the
condemn
history
business
as
abominable.
in
has occurred
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such a clash of apparently irreconcilable
ideas as has at this time
of
and
discredited
general
unrest,
together
with
the
it,
immense range of
is
ment is imminent. As a result of the conditions produced by the European War, the play of forces,
usually
only
visible
to
expert
observers,
regarded none of
efforts
made
to
conceal the
of
definitely resulted
;
and there
Economic Democracy
is
little
will
be pro-
may be
it
well
more
salient features of
is
of
And
here
we
are
first
principles
to
an
unconscious,
its
To
of
course,
The
infinite
combi-
will,
form
But of the many attempts which have been made it is quite possible that the definition embodied in the majestic words of the American Declaration of Independence, " the inalienable right of
man
to
life,
Economic Democracy
liberty
still
is
unexcelled,
is yet far from complete justificaand if words mean anything at all, these words are an assertion of the supre-
its
birth
;
tion
macy of the individual considered collectively, over any external interest. Now, what does this mean ? First of all, it does not mean anarchy, nor does it mean exactly what is commonly called individualism,
which generally resolves
to
itself into
a claim
to
force
the
individuality
of
others
subordinate
the
itself
to the will-to-power of
self-styled
it
individualist.
And most
collectivism
emphatically
in
does not
mean
is
to
economic and
of
initiative
such control
every
that
by
its
exercise
and mechanism
that
by
their
tage, that in
common
Economic Democracy
complete independence,
whether he
will
may
most
definitely
economic
"
it
is
simply
to
hypocrisy,
conscious
or
unconscious,
which
made
shall
be forthcoming.
seems clear that only by a recognition of this necessity can the foundations of
society be so laid that
built
no superstructure
as
fail,
the superis
structure
capitalistic
society
most
unquestionably
are honey-
combed with
decay.
Systems were made for men, and not men for systems, and the interest of man which is self-development, is above all
systems,
whether theological,
political
or
economic.
Economic Democracy
CHAPTER TWO
ACCEPTING
clear
this
statement
it
as
that
all
the
furtherance
it.
of
the
principles contained in
If a State
system
can be shown to be inimical to them it if social customs hamper their must go continuous expansion they must be modi;
fied
if
That
It is
is
to say,
of the
no appeal, the exploitation of a public opinion which at the present time for is frequently manufactured interested purposes, and other attempts to shift the centre of gravity of the main issues
;
8
these are
Economic Democracy
all
is
which
it
If,
therefore,
and while co-operation is the note of the coming age, our premises require that it must be the co-operation of reasoned
tion
;
assent,
of
any
however
superficially
attractive.
There
is
from
the date of the publication of " The Origin of Species " the theory of the " survival
of the
as
fittest
hardship
and although such books as Mr. Benjamin Kidd's " Science of Power "
why
own
to
interest
and consequently
well-fitted
survive.
Economic Democracy
may and
in
community, we may begin our inquiry by noticing that one of the most
serious causes of the prevalent dissatisfaction
and disquietude is the obvious survival, success and rise to positions of great power, *' of individuals to whom the term '* fittest could only be applied in the very narrowest
sense.
And
in
it
admitting
is
the justice
of
the criticism,
to
question
the
soundness
of
Darwin's
is
theory.
Such
an
admission
simply
evidence that the particular environment in which the " fittest " are admittedly
surviving and succeeding
is
unsatisfactory
in the
mind
ment cannot be
effect
To what
the
systematic organisation
connected with
of
biological
statement
of
the
law
10
Economic Democracy
effort
in
with
well-defined
principles,
ceeded
source
from
Germany,
although
their
;
may very possibly be extra-national and while these principles have been accepted and developed in varying degree by the governing classes of all countries, the dubious honour of applying them with rigid logic and a stern disregard of by-products, belongs
without question, to the land of their birth.
as a claim for
which is externally imposed on him which it is not necessary or even desirable that he should understand in full and the forging of a social, industrial and political organisation which will concentrate control of policy while making effective revolt completely impossible, and leaving its originators in possession of supreme power.
Economic Democracy
11
some
external organisation,
from which there is no appeal (as if the State had a concrete existence apart from which those who operate its functions),
the
exploitation
of
" public
opinion
'*
all
features
to the
commended
by a claim that the interest of the community is thereby advanced, and its results in Germany have been nothing
than appalling.
of a
less
istics
nation
population
of
65 millions have been completely altered in two generations, so that from the home of idealism typified by Schiller, Goethe, and Heine, it has become notorious for bestiality and inhumanity only offset by a
slavish
discipline.
Its
statistics
of
child
war
12
Economic Democracy
down were becoming by far the gravest problem of the German medical profession.
Its
all
honour,
and
the
external
influence
of
which
quite
inevitably
all
cul-
history.
The comparative
by an
the
essential
rapidity
with
which
of
characteristic
Teutonic
these
race,
and
the
in
attempt to
embody
principles
Anglo-Saxon
imminence of a determined effort to transfer and adopt the policy of central, or, more correctly, pyramid, control from
to the
the nation
it
more fortunate. Thus far we have examined the psychological aspect of control exercised
through
to its
power.
confront
moment
The
material side.
Inequalities of circumstance
vicious
Economic Democracy
circles of
13
unemployment, degradation and unemployability, the disparity between the reward of the successful stock-jobber and the same man turned private soldier, enduring unbelievable discomfort for eighteen-
pence per day, the gardener turned pieceworker, earning three times the pay of the
skilled
and demand.
it
is
clear that
settled
principle
been abandoned, and mere expediency has taken its place. The attitude of statesman and officials to the people in whose interests they are supposed to hold office, is one of scarcely veiled antagonism, only tempered by the
solidation of power, has
fear
of unpleasant
consequences.
In the
supremacy of patron-
widespread resentment,
levelled
than
In
14
Economic Democracy
In the interim report
Industrial
:
Commission on
Unrest,
the following statement occurs " There is no doubt that one cause
of labour unrest
is
that
workmen have
promises
come
to
regard
the
and
dis-
In industry
itself,
between the forces of Capital and Labour, on questions of wages and hours of work, is daily becoming complicated by the introduction
status
of fresh
issues
such as welfare,
it
and
discipline,
and
after
is
universally
convulse
one
trade
another,
have
matter of contention.
cleavage
is
evident
in
the
acrimonious
squabbles
between
the
file
and the unskilled, the rank and and the Trade Union official.
skilled
Economic Democracy
15
Although the diversion of the forces of industry to munition work of, in the
it
is
markets was of
the
fiercest
world was
apparently overproducing
in spite of the
on the verge of starvation (Snowden and Syndicalism), and a great majority whose only interest in great groups of the luxury trades was that of the wageSocialism
earner.
The home
classes
.affected
only
that
realised
work
and
of
plexity
production,
paralleled
comby the
is
life,
16
Economic Democracy
sieve through
go
for
all
ideas, scruples
We
satisfaction
with
not
only
the
material
results of the
economic and
to
political systems,
and and it will be noticed in this enumeration of social evils, which is only so wide as is necessary to suggest principles, that emphasis is laid on what may be called abstract defects and miscarriages of justice, as well as on the material misery and distress which accompany them.
which
is
hostile
moral
;
progress
intellectual
expansion
The reason for this is that the twin evil (common more or less to all existing organised Society) of servility
is
poverty, as has
all
been
clearly
recognised by
shades of
Socialism.
Poverty
is
in
itself
phenomenon, but servility (not necessarily, of course, of manner) is a definite component of a system having
a transient
Economic Democracy
centralised control of policy as
its
17
apex
and
is
while
the
development of self-respect
to
it
condition
any
is
real
improvement
is
in
environment,
challenged.
thereby
to the standard
we have
agreed to accept,
however,
it
seems
primary requirement, and to the extent to which these qualities are repressed, social and economic conditions stand condemned
as undesirable.
Now
ised or
it
and
is
certain
for
conditions,
the
of
ideal
organisation
specific
the
attainment
end.
one
only
and
is
material
The
effective force
be attained
will,
human
and
keep
if
an organisation of
the
will
this character
component members focussed on the objective to be attained, the collective power available is
can
of
all
its
18
For this reason the advantage accruing from the use of it for the attainment of one concrete objective,
other form of association.
such
of a
as,
let
National
supply
but
every
particle
of
is
show
that
it
system of administraof
tion
for
the
purposes
governing the
that
it is
in opposition to every
when
so used,
and for this reason it is vital to devise methods bv which technical co-ordination can be combined with individual freedom.
To
is
crystallise the
in respect of
any undertaking, centralisation the way to do it, but is neither the correct
of
method
deciding
what
to
is
do
to
or
of
it.
who
do
Economic Democracy
CHAPTER THREE
WE
conditions
real
are
thus
led
to
inquire
into
possible,
of
which can be charged the development of servility on the one hand, and the discouragement of possibly more desirable characteristics on the other, and
to
in this inquiry
it
is
danger of mistaking
further,
to
and,
beware of
seeing
only
really con-
For instance, that from the misuse of the power of capital many of the more glaring
defects of society proceed
in
is
certain,
but
claiming that in
itself
is
ministration of industry
almost cer-
20
Economic Democracy
disease,
and taking no
facts.
It
is
differentiate
in
this
it.
The
account
administration
of
capital
its
by
it,
capital,
progress,
and
the
possibilities of material
betterment based on
would never have achieved the rapid development of the past hundred years and still more important at this time, only the control of capital, which on the one hand has degraded propaganda into one of the Black Arts, has, on the other, made possible
;
the
Campaign of the
or
early
nine-
teenth
century,
the
parallel
activities
The very
itself
agitation carried
on against
capitalism
Economic Democracy
21
The capitalistic system in the form in which we know it has served its purpose, but and may be replaced with advantage
;
in
any
social
first
necessity is to provide some bulwark against a despotism which might exceed that of the Trust, bad as the latter has become. In
baby with the bath water, and, by discarding too soon what is clearly an agency which can be made to operate both ways, make democracy even more unsafe for the individual than it is
tip out the
mocracy it we do not
is
a matter of real
urgency that
at present.
The
danger
which
at
the
moment
more than
any extension of individual enterprise is the Servile State the erection of an irresistible and impersonal organisation through which the ambition of able men, animated
;
lust
may
ment of their fellows. Under such a system the ordinary citizen might, and probably
22
Economic Democracy
freed
modern
is
thought.
The
is
of
would be well to
large
profit-
preserve
and
revive.
The
its profits
making limited company which distributes over a wide area is already rapidly
displacing the family business and, as will
it is
be seen,
aspect of
lie.
its activities
worst features
the
enemy
is
which Prussianism, with its theories of the supreme state and the unimportance of the individual (both of which are the absolute negation
to servility, of
complement
of private enterprise)
is
and that
nationalisation of
the
means of
Economic Democracy
livelihood, without the provision of
23
much
more
effective safeguards
been publicly evolved, leaves the individual without any appeal from its only possible employer and so substitutes a worse, because
which
It
more powerful, tjiranny for that it would destroy. is a most astonishing fact that the ex-
men
and women in such departments as the Post Office, where real discontent is probably more general, and the material and psychological justification for it more obvious, than in any of the more modern industrial establishments, has not been sufficient to impress the public with the futility of mere nationalisation. This is not in any sense
a disparagement of the excellent qualities ot
large
it
numbers of Government
facility
officials
is
remarkable
be
hypnotised by a phrase.
that
It is
notorious
the
State
Socialists
of
Germany,
c
commonly known
as the
Majority Party,
24
Economic Democracy
Junkerdom
in carrying out
its
plans for a
Prussian world
hegemony
while in our
own
each other
is
simply
is,
power, the
in a
numbers of shareholders, but frequently directed by one man and this process is quite clearly a stage in the transition from
;
This
power of
capital
Economic Democracy
25
has
its
:
activity
huge
stores, of
and in every case is commended to the reason by the plea of economic necessity and efficiency. But behind this lies always the will-to-power, which operates equally through politics, finance or industry, and
always towards centralisation.
of view be admitted, that to the individual
difference
tion.
it
it
If this point
make very
little
what name
is
given to centralisa-
added have no
One
of the
more obvious
of
effects of the
in
concentration
credit-capital
few
its
contribution
26
Economic Democracy
Although
economics
of
we
of the increasing
employment
machinery
phenomenon
it
is
may be
method by which this illusion is produced, and it is probably not possible to do so in better words than those used by Mr. J. A. Hobson in his " Democracy After the
War":
Where
the product of industry and
commerce
is
so divided
relatively
power of the masses sets a limit on the home market for most staple commodities. The staple manufacturers, therefore, working with modern mechanhigh, the small purchasing
ical methods, that continually increase the pace of output, are in every country compelled to look more and more to export trade, and to hustle and compete for markets in the
backward countries of the world. Just as the home market was restricted by a distribution of wealth which left the mass of people with inadequate power to purchase and consume, while the minority who had the purchasing power either wanted to use it in other ways or to save it and apply it to an increased production which still further congested the home markets, so likewise with the world markets.
. .
Closely linked with this practical limitation of the expansion of markets for goods is the limitation of profitable fields of investment. The limitation of home markets implies a
Economic Democracy
Because capitalism per se
operates
in
is
27
largely the
economic
its
sphere,
is
some
wealth
examination of
methods
of
necessary.
The
accumulation
financial
profit is
merely one
it is
money, but
is
in
associated to
mind
it is
in this sense
word
is
here employed.
is
The
capitalistic
system
based fundamentally
involves
a
on the
supply
financial
and
demand, which
legiti-
state-
ment which is becoming increasingly discredited, and is negatived in the limitation of monopoly values, by common consent,
in
respect
of
public
utility
companies,
Proceeding
from an economic
system
28
Economic Democracy
product for a
senting
its
sum
payment
various
money
in
its
credit,
which,
medium which
of,
has reached
no matter
what
it
is
made
it,
people want
exchange
Walker,
p. 6).
**
for
his
Industry,"
So long
it
definition
holds good,
is
an absolute
lien
on the services
whole stock of
of credit,
in
definition,
financial
wealth,
by the
be
to balance
of the
world's
;
Economic Democracy
29
and generally
it
is
assumed
by the creation
of credits broadly representing the mobilisation value of these assets either in esse
But
for reasons
which
will
be evident in
the creation of
form of
bank
credits,
and
which the accountant calls capital, but which are in fact merely a function of
figures
prices.
The
effect of this
is,
of course,
to
decrease
progressively
or,
the
purchasing
services
power of money,
concentrate
others,
in
other words, to
the
lien
on the
of
which money
gives, in the
hands of
30
Economic Democracy
methods operate
we
see, is pro;
and
we may
ated,
is
fairly
making system
proceeding
in
industry
another
in
development,
its results,
apparently
contradictory
During the period of transition between individual ownership and company or trust management, and under the stress of competition for markets, it became of vital
importance to cut
commodities, not
a means to this
selling price of
intrinsically as
;
them
Economic Democracy
31
and the incorporation of the worker into a machine-like system of which every
ship,
part
is
may
The
able
extent,
been attained
^the
scientific
management systems
Mr. Frank
higher
than
existed
methods have commonly been accompanied by systems of payment-by-results, such as the premium-bonus system in its various forms as adapted by Halsey, Rowan, Weir, etc., round which has raged fierce controversy
a bait for the worker these
As
profit,
they
.32
Economic Democracy
were unable to take into account the operation of broad economic principles. It is no part of the argument with which we are
concerned to discuss such systems in
but
detail,
any
unprejudiced
and
sufficiently
technical consideration of
them
the
will carry
immediate
was undoubtedly
and so apparently to delay the concentration of wealth, it was correctly recognised by the worker that his real wage tended to bear much the same ratio, or even to fall, in comparison with the cost of living, since the purchasing power of money in terms of food, clothes, and housing fell faster than his wages rose.
to raise earnings
As the mechanical
rose,
strife
efficiency of production
therefore, discontent and industrial became accentuated, and an unstable equilibrium was only maintained by the operation of such factors as have become known under the names of " ca'canny," restriction of output, etc., and before the war the operation of piece-work systems
in large industrial engineering
works almost
Economic Democracy
33
and piecework earnings, generally ranging between It is not necessary 1.25 and 1.5 to 1. to discuss the ethics of such an arrangement
local ratio
between time
rates
it
is
merely
necessary
to
note
that
the
settled policy of
could get in
its
own
over
out-
exercise
its
control
own standard of
put
irrespective
of time.
The
situation
created
by the demand for munitions of all kinds during the war has, of course, profoundly
modified this attitude, with
the
result that a temporary very large increase
in real earnings
of
commodities
but
is
is
war,
it
unquestionably
fall
as
economic
actual
comes
scarcity.
ineffective
apart
from
34
Economic Democracy
Quite apart, therefore, from
all
questions
of
one
mechanical
requiring
operation
skill,
devoid
of
interest,
little
and having
money The
to escape
from
it.
he
part of a
machine
which he is not interested. His foreman and departmental heads are, from the largeness of the undertakings, almost inevitably
out of
human touch
all
the
well-known
phenomena
bureaucratic
in
all
these
things
is
the
nucleus of a
centrifugal
movement
of formidable force.
Nor
life..
is
this
The
Economic Democracy
35
and capitalism
pointed out.
of the will-to-power
By
has
been
made
operative
which
would
on the
ability of authority to
dictate the
But
it
is
doubtful
whether there ever was a time when this threat was held more lightly, and the disregard of consequences so widespread.
is
It
not
either
military
industrial
is
regarded
opposite
with
is,
complacency
the
exact
of
world
is
instinctively
an
anachronism,
minds of
Economic Democracy
CHAPTER FOUR
WE
the
are,
therefore,
faced
with an
movement towards
control, backed
centralised
by strong arguments as to
efficiency
increased
and
consequent
economic necessity of organisation of this character (and these arguments receive support from quarters as widely separated as, say, Lord Milner and Mr. Sidney Webb),
and, on the other hand, a deepening distrust
of such measures bred by personal experience
and
observation
of
their
effect
on
of
the
the
its
individual.
powerful
to
minority
to
community,
position
determined
the
that
maintain
relative
majority,
is
assures
no alternative between a pyramid of power based on toil of ever-increasing monotony, and some while a form of famine and disaster
the
world
there
38
Economic Democracy
dissatisfied majority
throw off the hypnotic influence of training and to grapple with the fallacy which it feels must exist somewhere. Now let it be said at once that there is no evasion of this dilemma possible by the
introduction of questions of personality
is still a bad system no matter what changes are made in personnel. The power of personality is susceptible of the same definition as any other form of power, it is the rate of doing work and the rate at which a given personality can change an organisation depends on two things the magnitude of the change desired, and the size of the organisation. As it is hoped
a bad system
to
make
complex purpose of
is is
civilisation pro-
Prussian
one instance.
a
structure
Pyramidal
to
organisation
designed
sooner
or
later
becomes
all
other
Economic Democracy
considerations to
tion.
its
39
For
are
this
which make
control
those
which
make
it
most
operations
of
the organisation in any external interest, and the progress to power of an individual under such conditions must result either
in a complete acceptance of the situation as
he finds
it,
or a conscious or unconscious
sycophancy quite deadly to the preservation of any originality of thought and action.
It
at this
how
dissimilar their
name, favour
and
it
is
name
it,
we may
its
eventual performance.
40
Economic Democracy
which have arisen from modern industrial and political systems in the light of this
centralising tendency,
it
is
instructive to
turn for a
moment
respect
to the examination of in
them with
displaced,
to
those
they
have
and without covering afresh the ground which has been sufficiently well traversed by the exponents of National Guilds, Syndicalism and other systems of
industrial self-government,
it
may be
well
was
largely
marked
in principle
by the separation of the workman from the ownership of his tools and the control of
his business policy.
the equipment was handicraft of a tradesman was of the simplest the practically selling price of the product was
All craft
;
direct
and
practically the
whole of
it
was
available
and
Economic Democracy
41
So
far as
assumption,
was
within
the
craft
unemployment at all comparable to that with which we are too familiar, and, at any rate, within
guilds no involuntary poverty or
maintained
considerable
pride
in
his
work
and
independence.
of machinery
came the
;
on payment
for
this
his
services.
The
money
development from
stage,
though the
by the enterprising man who both worked himself and directed the work of others, to the larger factory in which the function of the craftsman ceased to be exercised by
the employer,
tion
who
and management
42
liability
Economic Democracy
company
the
management, and the direction of policy, became still further separated, has been logical and rapid, and this development carries with it changes
craftsman,
of a fundamental character.
Behind
acquiescence of the
human
and
this
an objective.
classes into
By
mere agents of a function, it has been possible to obtain the more or less complete co-operation of large numbers of individuals in aims of which they were completely ignorant, and of which had they been able to appreciate them in their entirety, they would have completely disapproved, while at the same time Education and Ecclesiasticism have combined to foster
the idea, that so long as the orders of a
superior were obeyed, no responsiblity rested
on the
It
is
individual.
not,
of
course,
suggested
that
commercial
policy
has
been
deliberately
Economic Democracy
43
far
from
it
nor
is
it
indivi-
develop-
but since
has been
accompanied by a growing subjection of the individual to the machine of industrialism, it is quite unquestionable that the whole process of centralising power and policy and alleged responsibility in the brains of a few men whose deliberations are not open to discussion whose interests, largely
;
many
respects
opposed
control,
is is
to those
and whose
can be victimised
ditions
selective
process.
When
it
is
further
considered
power fall to men whose very habit of mind, however kindly and broad in view it may be and often is in other directions, must quite inevitably force them to consider the individual as
44
Economic Democracy
for a policy
mere material
whether of
politics
Along with this development has gone a parallel change in the status of the individual. The apprentice, the journeyman and the the master were all of one social class apprentice or journeyman dined at his master's table and married his own or some
;
the standard of
of
therefore
without,
course,
being
identical,
was comparable
as
between various
standard
grades.
siderable to
The
it
involved a
common
which
everyday
difficulties
could
be
referred.
and a comparison of the conditions produced by them with those existing in our industrial districts in more recent years, has led reformers of the type of William Morris
and John Ruskin to idealise this period and to place to the debit of machinery and quantity-production all the miseries and
ugliness visible in the
manufacturing North.
Economic Democracy
mistaken, and here again
a
45 met by
effect
:
we
are
confusion
is
between
cause
and
there
no virtue in taking ten hours to produce by hand a necessary which a machine will produce in ten seconds,
absolutely
thereby releasing a
human
being to that
it
is
essential
;
that
freedom maintenance
achieved.
of
life
should
mere thereby be
with this
How,
dilemma
that the
then,
?
are
we
to
deal
It
advancement gained
and and
that
men
an5rthing
hammer
But while progress in the replacement of manual effort by machinery seems both natural
chisel or a spinning wheel.
and
beneficial,
it
is
and intellectual revolt against the conditions which have grown up alongside this material progress is fundamental and
spiritual
46
Economic Democracy
mere
betterment
ists alike in
has
been
one
to
of
grudging
compromise,
of humanity
methods
and partly no doubt from a settled conviction that nothing but compromise was
possible
;
is
based
and that all critics are and dreamers, or else are solely actuated by a desire for the sweets of office. It is most important to recognise that there are two distinct problems involved one technical, the other in this dilemma psychological, and it is just because the psychological aspect of industry has been
either
cranks
confused
with
and
subordinated
to
the
we
There
for the
we
are rapidly
attaining
command
of the
means
Economic Democracy
a purely technical nature, and
47
it
may be
methods
system
which
has
the
modern
to
industrial
developed
deal
with
the
organisation of large
commercial success.
Very broadly the main difference lies between what may be defined as the military and the functional systems of control, or some combination of the two, and these involve an interesting difference of conception.
As we have
seen,
the
development of
been very largely a practical application of the economic proindustrial activity has
position in regard to the division of labour ; the *' military " organisation conceives a
large business or a
Government Department
as
man
could do on a small
organisation
character
would be
48
Economic Democracy
in
the
aggregate,
achieve
it
left its
mark
on
civilisation
it
is
easy
to
distinguish
civil
servant, or even
development due to the unbalanced exercise of one set only of perhaps many
the
abilities
resident in the
human
unit, is a
A
to
its
little
furthest limits
is
pyramid control in
it
is
the
number
is
grade, until
function
Economic Democracy
the apex, are definitely characteristic of
49
it.
The
next step
is
becomes the head of a separate Httle pyramid, each of which as a whole furnishes the unit composing a larger pyramid in every
;
case,
however,
eventually
concentralising
in
one
life.
ment
Firstly,
there
is
fundamental in-
equality
of
opportunity.
approaches
that there
certain
is
it
it is,
is
ment Department, or great industrial undertaking. There is no doubt whatever that the intrigue which is a commonplace in
such
undertakings
has
its
roots
almost
50
Economic Democracy
and contributes
in
no
in-
Another
proceeds
detail
is
objection
which
becomes
knowledge.
This
difficulty is recogofficial
and
intelligence
departments which,
Having these points to some extent in mind, American industry has developed what is most unquestionably a very
important modification of principle
control
that
that
is
one function
say
time-keeping.
In
methods
and with
still
The
the effect
on
narrow a function as
so-called scientific
is
demanded by much
Economic Democracy
is
51
very
little
does
contain
germ of an
industrial
could
be removed, and
it
is
form
of
organisation
produces
its
own
type of personality.
It will
in
the industrial
:
a double
problem
to
to solve
mechanism
productive
purposes,
and to restore personal initiative. The proposition which is being urged from orthodox capitalistic quarters as a means of dealing with this situation is a
little
ingenuous.
It consists of
an intensi-
fication policy
way,
all
exaggerated,
usually
are
disappear,
at the
and
it
is
summed up
*'
moment
for
in the
phrase,
We
fair
statement
of this
demand
unlimited
52
1.
Economic Democracy
We
must pay
for the
war and
for
betterment schemes.
2.
Taxes must come from profits and earnings, which are parts of one whole. 4. High earnings, high profits, and low labour costs, and low selling and competitive costs, can only be combined if
3.
increased output
5.
is
obtained.
High earnings will mean wider markets. this is a very specious argument a large number of people, whose instincts warn them that there is a fallacy somewhere,
Now
have not
felt
effective criticism of
since
is
some
practical
knowledge of technique
involved.
The
major
portion
of
the
securities
representing
their
title
and the
All this
Economic Democracy
is
53
it
is
of
all,
let
it
be admitted that a
to
have to be done,
firstly,
reinstate the
provide
of
quantity
These
goods
in the
be furnished for
money
to
main be supplied by
mean more
is
on public
salaries
money
and
will
be distributed in wages,
profits,
which
(at
will
and other conditions are favourable) to buy more goods, or, conversely, save more money, and eventually enjoy more leisure and freedom.
so long as labour
deserves, because
on
it
54
Economic Democracy
If
is
it
true
which
stands behind
cartels, trusts,
make this analysis it is unavoidable that we should enter into some detail with regard to the accountancy of manuorder then to
facturing
;
distribution of wealth
an
initial restriction
on the
and that
at in
in consequence
contention of the
argument,
but
is
an
equalisation
purchasing
the
power.
is
amount
be bought with the sum of money available, and it is clearly a function of price. It is
a widely spread delusion that price
is
simply
Economic Democracy
free competition
55
limit,
being fixed
profit
by
will
plus
the
minimum
which
in
ment
this
to produce.
important to bear
it
mind,
a
because
is
frequently
will
assumed that
bring
mere
glut
of goods
irrespective
in
down
prices
quite
of
any
all
intrinsic
economy involved
the result
large
scale production.
absorbed,
may be
exactly
into
must go
succeeding costs.
Cost
is
the accumulation
power
price
eflfective at
the
moment
is
of purchase.
Where competition
is
restricted
by Trusts,
considers
politic to charge.
Economic Democracy
CHAPTER FIVE
LOOKED
is
at
from
is
this
standpoint
the
it
fairly
clear that
kernel of
cost, since
the
it
problem
factory
is
company
all
equally or
was done by
its
the firm
etc.,
salesmen,
was
their salaries.
We
complete
profit-sharing
Capitalism in
its
us assume,
make
a complicated
engineering product,
and would absorb considerable quantities of power and light, lubricants, etc., much of
58
Economic Democracy
which would be wasted and would inevitably produce a certain amount of scrap the value of which would be less than the material in the form in which it entered the works. The machinery would wear out, and would have to be replaced and maintained, and generally it is clear that for each unit of production there would be three main divisions of factory cost, the " staple " raw material, the wages and salaries, and a sum
;
upkeep on the whole of the plant, which might easily equal 200 per cent, of the wages and salaries. As the plant became more
automatic
by
improvements
in
process,
the ratio which these plant costs bore to the cost of labour and salaries would increase.
The
would be the addition of these three items staple material, labour and salaries, and plant cost, and with the addition of selling charges and profit, this would be the selling price. As a result of the operations of the undertaking, the wealth of the world would
therefore,
:
Economic Democracy
59
all
the material
total
the
factory,
and the
sum
represented
product.
amount
profit
or
dividends,
would be
less
and by a
considerable
sum
(representing purchases
on
and if this is true in one factory it must be true in all. Consequently, the total amount of money liberated by manufacturing processes of this
price of the product,
nature
is
This difference
is
due to the
is
growing with the time required for manufacture, during the same time the money distributed by the manufacturing
steadily
process
is
through
sumption.
immediate
con-
make
this clear.
steel bolt
60
Economic Democracy
might require in the blank about eleven and a half pounds of material representing,
say, 3s. 6d.
The
The wages value of the total one penny. man-hours expended on the conversion from the blank to the finished nut and bolt might be 5s., and the average plant charge 150 per cent, on the direct time charge,
i.e.^
7s.
6d.
The
15s.
factory
cost
would,
7s. 6d.,
therefore, be
lid., of
which
or just
charge.
Of
cent., or
this
plant
charge
probably
75 per
about
5s. 7d., is
represented
by the sum of items which are either afterwards wiped off for depreciation and consequently not distributed at
all at
that time,
which payments clearly must be subsequent to any valuation of the articles for which they are paid, and so do not affect the argument. Without proceeding to add selling charges and profit it must be clear that a charge of 15s. lid. on the world's purchasing power has been created,
organisation,
Economic Democracy
of which only 6s.
lOd.
is
61
distributed
in
and that if the effective demand exists at all in a form suitable for the liquidation of this charge, it must reside in the
sideration,
banks.
total increase in
we must
are
that
There
two sources remaining loan-credit, is to say, purchasing power created by the banks on principles which are directed
solely to the production of a positive fin-
ancial result
Now
as
loan-credit
as
consumer
such,
because
has
consumption
In
consequence
become the
any
will
financial or
an
inflation of figures.*
62
Economic Democracy
An
is
additional
factor
also
comes
into
on a
credit basis.
In the case of
commodities
in general retail
rise
demand, the
limit,
price tends to
become
by an
in-
works,
when completed,
ot
credit.
expansion
This process
in
purchasing power.
The
reason
the
decrease
in
the
would be suggested by these considerations is, of course, largely due to intrinsic cheapening ot processes which would, if not defeated by this dilution of
so great as
the
consumer's
purchasing
faster
power,
have
There are thus two processes at work an intrinsic cheapening of the product by better methods, and an artificial decrease
;
Economic Democracy
in purchasing
63
is
power due
to
what
all
in effect
waste and
consumer.
this
And
it
is
clear
that
under
the volume of production the larger will be the absolute value of the waste which the
consumer has
or
no,
to
pay
for,
whether he
credits
will
because as the
bank
are
and repaid out of prices, each article produced dilutes, by the ratio of its book price
to
all
These
perfectly
by the
is
has to be liquidated.
Already there
the
is
not very
much
left
of
argument for the innate desirability unspecified and intensified manufacturing under the existing economic system, but more trouble yet is ahead of it. While the ratio of plant charges to total
of unlimited,
64
Economic Democracy
wages and salaries cost is less than 1 1 over the whole range of commodities, a general rise in direct rates of pay may mean
:
purchasing
their
power
the
of
in
those
this
who
way.
obtain
remuneration
But
of
when
by
increased
application
every general increase in " direct " labour may mean rates of pay of
of
an actual decrease
consumer
products
is
only
interested
in
ultimate
and
overhead
charges
do
not
represents a
an access of wealth
and to everyone concerned, no matter what its description and utility^ so long as by any method it can be sold and wages distributed in respect of it, will, therefore, be seen to be a dangerous fallacy based on an entirely wrong conception,, which is epitomised in the use of the word
to the country
"
Economic Democracy
65
Manufacturing of
in
the
conversion
of
is
it
one
only
advantageous
serves
a
to
the
extent
that
sub-
definite
requirement
it
of
human
all
evolution.
In any case,
shares with
useful effort
" useful
and sane
wealth
human requirement
is
served
the
and standard of living of the community may thereby be enhanced. If the effort
is
money
attached
to
The
fore
clearly
attaches
concrete
money
money
66
Economic Democracy
the
broadest sense,
misdirected effort
which appears in cost forms a continuous and increasing diluent to the purchasing
value of effort in general.
Now
that,
at
it
has
already
been
emphasised
moment, economic questions are of paramount importance, because the economic system is the great weapon of
the
the
that
will-to-power.
if
It
will
be
obvious
duced
in other words,
machinery could be made effective in reducing to a very small fraction of the total
man-hours
quired
for
available,
the the
man-hours
world's
re-
adapting
natural
humanity
resources to the highest requirements of the " deflation " of the problem
The
technical
is
is
now
But
it
waste
money
Economic Democracy
value
attached to
67
is
it,
of remuneration must
sum
respect
of
of
the
economic
is
system that
and physical,
directed to the
may be absorbed
;
in
what is frequently toilsome, disagreeable to the end that a and brutalising work
device for the distribution of purchasing
in
is
existence.
The
since
the greater
organisation
of
the
to carry as
on
with
it
we have
all real
just seen, a
complete negation
of
progress.
factor of the
The common
tion
lies
whole
situa-
in
68
Economic Democracy
that
ficially
arti-
industrialism
not
its
progressive
objective
is
but re-
actionary, because
financial
an obsolete
most
effective
two-fold
the
removal
of
limitations,
and the
satisfaction
we
see,
sum
distributed
made
on the Capitalistic system, and is of small and diminishing importance as compared with the delusive accounting system which accompanies it, and which acts to reduce consistently the purchasing power of effort, it is, nevertheless, of prime importance as furnishing the immediate " inducement to produce," which is a false inducement
Economic Democracy
in that
69
it
may just
as probably be waste.
by wealth we mean the original meaning attached to the word i.e.^ " well-being,"
If
:
its
use for
life),
for the moral value of factory and bears no relation whatever to the value obtained by cost accounting.
made out
Further,
if
is
under-
will
in the con-
itself.
Having
issues
in
involved,
may be
desirable
to
summarise the conclusions to be derived from a study of the methods by which the
price of production
is
They
70
1.
Economic Democracy
Price cannot normally be less than
Cost includes
all
expenditure on pro-
duct.
3.
all
expendi-
dends as well as
account,
also
expenditure on factory
previous
representing
con-
sumption.
4.
Since
it
includes
this
expenditure,
and dividends.
These
the
represent
the
community
of
real
therefore,
only
distribution
the surplus
subsistence,
expenditure
has
materials
consumed
The
all
this
quently, in price.
6.
The
only
effective
demand
of the
71
few per cent, of the price value of commodities, and is The remainder of the Home cash credit.
a
effective
demand
is
is
controlled
and
the industrialist, in the interest of production with a financial objective, not in the
interest of the ultimate
It will
consumer.
signifi-
on the
in the control
of credit
Economic Democracy
CHAPTER SIX
will
IT
only
difficulties
we were
prior
to
the
may be contended
is
frequently
stated, that
at
even
their
statistics
minimum maximum
still
point
and
in
the
Nation
at
its
is
activity
Industry,
there
Re-
Bowley has
Kingdom
annum
mean,
is
if
to
10,000,000 heads
of families,
annum
per
family,
assuming
that
distribution
did
not
The
criticised
figures
;
themselves
in
have
the
been whole
but,
any
case,
74
Economic Democracy
argument is completely fallacious, because it takes no account whatever of loan credit, which is by far the most important factor
in
the
distribution
of production,
as
we
is is
What
it
does
show
effort
the
purchasing
power
of
its
productive power.
But
it
may be
advisable to glance at
some
the
and to
specific
realise
of most
of the
in
instances,
must be borne
mind
and
services,
i.e.y
payment
for
if
work
in
progress.
In other words,
production
or
superfluous
articles
in
order
that
useful
may be
distributed.
the ex-
the
to
increasing
necessity
of
Economic Democracy
age
the colossal
75
quite unob-
a waste
which
war only
occurred in the
moment when
a culminating
exhibition of organised sabotage was necessary to preserve the system from spontaneous
combustion.
The
that of
simplest
**
this
process
is
the elaboration
of every action in
so as to involve the
maximum
efficiency
and
the
in
human
an elaborate organisation and etiquette probably requiring two assistants and half a
wipe " a damaged water pipe, which could, by methods with which he is perfectly familiar, be satisfactorily
day, in order to
'*
such
as
the
operation
of
an
automatic
76
Economic Democracy
tool, are
machine
simple instances of
this.
Httle higher
up the
his
scale of complexity
new model
of
particular
speciality,
We then begin to touch worn out. immense region of artificial demand created by advertisement a demand, in
is
the
many
cases,
as purely
hypnotic in origin
mesmerised subject
All these are
instances which
the point.
much
of which,
tem,
is
quite
useless
;
in
is
increasing
the
amenities of
life
there
the burden of
armaments and the waste of materials and equipment involved in them even in peace
time
;
Economic Democracy
radically
finally,
77
and,
defective
social
system
but by no means
least,
the cumula-
and increasingly paid for by the raw material which forms the vehicle for the export of
further labour.
All these
of
wealth
of
money
fall
in
seems powerless to dispel an obsession which obscures the whole object and meaning of scientific progress and places the worker and the honest man in a permanently disadvantageous position in comparison with the financier and the rogue.
;
It is
money
is
a
;
stable
ratio
and its money value is a problem which demands a very early solution, and must clearly result in the abolition of any incentive to the capitalisation of any form of waste.
between the use value of
effort
78
Economic Democracy
The tawdry
service,
variety,
in the clearest possible manner that it is much better to " do " your neighbour than
to
do sound and
lasting
work.
The
offering
maximum
distribution,
is
de-
ment
of society fully.
Its
very existence
in
depends
on
constant
increase
the
and
supply.
Economic Democracy
CHAPTER SEVEN
the preceding endeavour to marshal
IF into
some
it
situation as
exists at
will
be evident
is
which
at the
we
are faced
in every aspect of
human
between
life.
It is
the
agelong
struggle
freedom
the
and and
which
all
command
system,
political
opportunity
and even, apparently, economic necessity, is ranged on the side of authority and ultimate authority is now exercised through finance. This antagonism does, however,
;
appear
at the present
80
side, or
Economic Democracy
the other
certain
is
inevitable
either
its
it
seems
perfectly
that
at
a pyramidal
organisation,
having
apex supreme
power, and
at its base
complete subjection,
which
is
more complete
be
decentralisation
known
portance
the
as
it
will
substituted
for
external
authority.
all
The
issue transcends in
:
im-
others
the development of
human
is
it
far as
with the
of
measure of co-ordination
by the displaceis
centralised finance.
The
which
implication of this
will
a challenge,
become more
definite as
its
time
right
Economic Democracy
81
practical difficulty
becoming almost insuperable, even in the cases where an honest effort is made to arrive at some solution. The various movements for the
reward and individual
effort
is
grant of a
minimum
to
mand
work "
draw pay) are all symptoms " of the breakdown of the financial " law of supply and demand in its application to economic problems.
Still
the
and the
amount of energy devoted to games. There is absolutely no concrete difference between work and play unless it be in favour of the former no one would contend that
it is
inherently
more
interesting or pleasurball in
able, to
in-
92
Niagara.
Economic Democracy
will
own
expense,
The
whole
;
difference in
is,
of
course,
is
psychological
the
acceptable
there
is
some voice
in control,
and there is an avoidance of monotony by the comparatively short period of the game, followed by occupation of an entirely different order. But the efficiency of the performance as compared with the efficiency of the average factory worker is simply incomparable any factory which could induce for six months the united and concentration enthusiastic of, say, an amateur football team would produce quite
astonishing results.
Now,
it
may be emphasised
is
here at once,
that there
absolutely
;
efficiency as a cult
brighter,
probably a
Economic Democracy
things
in
83
way. In time
the
best
possible
mum
is
enunciathat the
tion
a very different
conception of efficiency than the narrow " business " meaning commonly attached
to the word,
and
in
consequence
it
is
the
ments of society to attack any demand for improved conditions as simply an attempt to substitute sloth and incapacity for energy While, therefore, a reand capability. adjustment of system and, above all, a
complete
necessary,
reconsideration
it
of
objective
is
probable that the basis of such changes must be economic, tvith political
is
and financial systems auxiliary rather than definitive, and it is certain that a revision of economic policy, to be stable, must result in higher economic efficiency, even though the very aim of that higher efficiency is to reduce economic problems to a very
subordinate
position.
And
the
higher
84
Economic Democracy
We
tions
proposed.
There
is,
on the one
by
and
this
a purely artificial
on the other hand, the growing real demand, first for food, clothing and shelter and then for participation in the wider life which modern progress has
there
is,
And
made
possible,
money.
And
means the defeat of the will-to-power by the will-to-freedom, and in this reconciliation
is
involved a modification of
economic distribution.
Economic Democracy
85
left
Now
world
real
if
there
it
is
any sanity
proper
it
in the
at all,
demand
is
of
to say, there
must be
first
a production of necessaries
;
sufficient to
All financial
;
if
then finance
has
fails,
and
will
be replaced.
It
week of the time of every fit adult between the ages of 18 and 45 would provide for a
uniformly high standard of physical welfare
the
that
is
exact
figures
it
is
perfectly
distribution
facture
the real
86
is at
Economic Democracy
present quite intolerably unsatisfactory.
There is no need to assume that the whole machinery of business as we know it must be scrapped in fact, the machinery of
;
business, as machinery,
is
highly efficient
but
it
that
no
it
up
dis-
tribution
on
purely
artificial
grounds.
administrative
organisation
is
antagonistic
the
individual,
it
seems
look
evident that
tralisation
of control
that
we must
would be
for interested
purposes.
already seen, alongside the
of
political
As we have
concentration
and
industrial
is
power
forms.
already beginning to
show
itself in
various
of this force
will
be observed that
at
the
Economic Democracy
87
moment
it
is
organisation
in
be
new
forms,
such as the
To
will
effective,
however, against
tion
have
is
to
come
decentralised
of
economic power
necessary.
Among
forms
file is
the the
more important
in industry,
in
these
movement
councils
men's
politics,
from
any special policy for the furtherance of The apprewhich they may be used.
which the movements are by the reactionary capitalist is based far more on a recognition of the difficulties such a scheme of organisation offers to successful corruption and capture than to any regard for the specific items in the
hension with
regarded
policy
it
may
for the
moment
represent
dele-
88
Economic Democracy
by exactly the methods best understood by those with whom they have to deal. As the Shop Steward movement is the most definite industrial recognition from the Labour side, of the necessity for decentralisation, some examination of the The actual general scheme is of interest. details of the organisation vary from place to place, trade to trade, and even day to
day
;
production
of actual
as the nucleoli
political
is
both
industrial
and
power
not exercised
The shop
trial
steward
is
*'
"
is
rather
than
that
to say, he represents a
body of men
who produce an article, rather than a section who perform one class of operation for
widely different ends
;
but there
is
nothing
Economic Democracy
89
ism being
initiates
He
is
on the basis and forms a link of first-hand information, between the decentralised industrial unit and other units which may be concerned.
general
discussion
The
that the
whom
is
;
normal
occupation
and
remuneration
of
representatives
they represent
secured.
The
official
concerned
has, in theory,
the direction
from the bottom upwards inThe individstead of the top downwards. ual shop stewards are banded together in a shop stewards' committee, which has
again only just as
much
authority as the
it.
90
It
is,
Economic Democracy
of course, obvious that the per-
manent success of any arrangement of this character depends on a common recognition amongst the individuals affected by the
organization, of certain principles as " con-
In short,
administer
would
be
impossible
to
any such principles unless the general body of employees had a general appreciation of the fundamental necessities of the
design.
arrangements of this or
simply
provide
of
a
any
other
description
for
mechanism
the
administration
are not,
an
agreed system
they
and cannot
is
Where, of course,
confusion
of
it is
function
that
the
shop
steward claims control not only of the conditions of production, but eventually of the
terms
is
of
distribution.
This
confusion
is
not
Economic Democracy
necessarily
91
permanent,
It is
undesirable.
wealth, whereas
is
that production
tance of the
community not
as
workers,
but as a community, and as such the community is most clearly the proper though far from being the legal, administrator of it.
Economic Democracy
CHAPTER EIGHT
economically,
it
is
made
The
starting point
is
clearly a reasonably
Now
articles
the
production
difficulties
of
these
presents
no
.whatever.
purposes
of
destruction,
the
actual
has
been confined
blockaded,
facilities for
it
either
to
countries
effectively
distribution.
In
fact,
is
most
significant
that
94
sense)
Economic Democracy
production
has
been
enormously
standard
of
The
explanation of this
is
The
payments made in wages have increased, prices and the production of luxuries have been partly controlled, and sabotage has disposed of useless product, and so kept
up wage
distribution.
is
The
it
to
make
produced
under
and equally
for these
social
to necessity,
purposes
structure,
may
determine the
inasmuch as a complete success would be the most powerful incentive to the adoption of similar methods in less
fundamental directions.
Profiting
made
of the results
it
may be
Economic Democracy
95
Now
it
at the
may be
are
these
broadly
defined
that
of the
separate,
he
is
price,
supply
he
is
concerned
almost
;
with product.
On
is
of which, qua producer pure and simple, are broadly summed up in the word " con-
tentment."
The consumer
bution
effort.
;
is
interested
is
in
distri-
the producer
concerned with
sumer
are frequently
96
Economic Democracy
make
it
easier
to
define the
powers
to
each.
necessary to emphasise
it
for
purchasing
sufficient
power
in
money,
is
good and
production.
We
faintly
say,
and
it
is
only
contested,
that
that
it
is
pays the
that
it
is
who
is
primarily concerned in
parties, is so novel to
large
it is
that
to the world-wide
being
made
it
to
reconstitute society
on these very
principles.
will
Economic Democracy
lines
97
presented by the dissatisfaction of the worker with his conditions of work, and the
not
less serious
and
ultra-
may be modernism.
called mediaevalism
and
Mediaevalism
seems
to
is
claim
that
all
mechanical
inherently
his
progress
delusive
;
that
unsound mankind
very
constitution
compelled,
and is by under
In
by unaided
support of
skill
of
hand and
it
eye.
its
contentions
points to the
Golden Age
want was comparatively unknown, and green woods stood and clear rivers ran where the slagheaps and chemical works of Widnes or Wednesbury now offend the eye and pollute the air. When arts and crafts made industry almost a sacrament, and faulty execution a social and even a legal offence when the medium of exchange was the Just Price, and the idea of buying in the cheapest and
England, for example,
real
;
when
98
Economic Democracy
if it
existed,
was
and punished by
heavy penalties.
While appreciating the temptation to compare the two periods to the very great
disadvantage of the present,
it
does not
seem possible
we
are in a cul-de;
sac from which the only exit is backwards and it is proposed to make an endeavour to show that there is a way through, and
that
we may
such
retaining
in
addition
a solution which
may be
this,
described as Ultra-
Modernist.
In order to do
abstract
it
certain
assumptions
are
are
made.
are
They
are as follows
(1)
The
existing
difficulties
the
Economic Democracy
99
the
is
form
of
pyramid.
modern riddle of the sphinx because power over food, clothes, and housing is ultimately power over life. (2) So long as the structure of Society
persists personality simply reacts against
it.
it
merely
by
(3) It
ment of
is
a confusion of ideas.
will
sonality
only
become
through changed
(4)
social structure.
of Society
over individuality.
tive of
any change
is
to give individuality
maximum
100
Economic Democracy
it
seems
clear
that
the
first
is
and
give
probably
the
of
most
important step
control
to
individual
of the necessaries
life
on the
What
are these
terms
in
What
is
the last
little
conthere
sideration
must make
;
it
clear
that
one description
potential
effort
over a
If this
be admitted,
and
it
is
seriously
deny
it,
it
effort into
time
what
we may
^ is
call
the time-energy
unit.
Now, time
is,
number
of
human
timeis
Economic Democracy
101
and shelter, is clearly dependent on process and by getting free of this debt with the
;
minimum
is,
time, he clearly
so
much
the richer in
the use to be
But, and
made
it is
vital to
to say, a process
improved must, by the operation of a suitable economic system decrease the time-energy units demanded from the com-
which
is
will
theorem
stood
complete condemnation of
as
payment by
;
results
is
that
to say,
The primary
102
Economic Democracy
life
^
i.e.^
necessaries of
as
above defined,
have
food,
clothes
and
shelter,
an
important
characteristic
which
differentiates
them from
;
in
other
words,
the
average
human being
requires as a
a definite
groundwork
number
which to sleep and work, and the variation between the minimum and the maximum
quantity of each that he can utilise with
This
(it
fact
renders
it
perfectly
feasible
plished)
^to
estimate
the
absolute
pro-
the
present
of
to
mechanical
and
those
units
scientific
development
;
produce
foodstuffs
and
the
time-energy
approximately available.
Accuracy in these
Economic Democracy
estimates
is
103
there
is
unnecessary,
since
so
**
large
that
it
is
only the
failure
effective
demand "
which
under
has
existing
circumstances
over-production.
prevented
superficial
The
make
most
this obvious.
There
is
good ground
for
stating that
all
adults
between the ages of 18 and 40. Exactly the same principle is applicable
to the provision of clothing
and housing,
as
distinct
and the
of
these
**
staple
*'
commodities
from the
to put the
exploitation
effort "
necessary
made
all
and
that
the
human
effort specifically
eliminated.
The
exact figures
104
Economic Democracy
work per head per day is ample for the purpose of meeting consumption and depreciation of all the factors of modern life under normal conditions and proper
three hours'
direction.
Now, such
a line of policy
is
clearly
it
based
on co-ordination of
sation of initiative.
design, but
evolves
radical decentrali-
firstly definite
pro-
of
output
to
programme
vision
produced.
The
the pro-
more extended
There
is
State idea, to
They
Economic Democracy
105
seem
such
problem
is
power that no incentive is necessary because no resistance is possible, or, alternatively, that the mere creative
irresistible
any thought of personal benefit. In regard to the former idea, it may be said that quite
apart from
its
fundamental objection
;
it
is
quite impracticable
latter that
it is
and
in regard to the
the
creative
same channels
economic
is
Under
fail
much
and
performance of the immediate task seems both practically and morally sound.
First
of
all,
necessary
106
Economic Democracy
which
is
the
amenities
of
civiHsation
are
payment by financial manipulation (profit), payment by time (salaries and time- rate wages), and payment by results (piecework in all its forms), and
of three varieties
;
it
first
fullest use.
Payment
by
financial
manipulation,
profit (other
quite
definitely anti-social.
tralise
all
operates to neu-
by diluting the medium of exchange, and by this process it will quite certainly bring
about the downfall of the social order to
which
it
belongs,
largely
through
the
Payment by time
reasons
;
fails
for
two
practical
it
is
Economic Democracy
107
any
relation to the
assumption that
Because of the
genuine
for
it,
and the
a fixed value.
first
clearly penalises
initiative
demand
policy of
rates
for
the
it
of the second,
The
Trade Unions
it
in regard to time
has used
action
;
its
organised
power
for
aggressive
and while
such a policy
may be sound and justifiable under existing conditions it clearly offers no promise of social peace.
Payment by
results or
piecework
may be
it
considered as the
final effort of
itself.
an outworn
system to justify
Superficially,
seems
of
its
increase
the
individual
time-energy units
and the
whole value of
contention
is
increased efficiency.
If this
much
greater
108
Economic Democracy
Ages admitted
in such books as
*'
The
it.
Six
Hour Day
that,
just
no
method or
dexterity, so
there no funda-
Consequently,
conditions, either
(1)
all
piecework
systems
Large
classes
of
workers
earn
money
which bear no ratio to equally meritorious efforts on other bases of payment. If any effort is made to unify the basis on a large scale the purchasing power of money becomes completely unstable,
or
(2)
piece rate
is
any urgent incentive to change of method as an excuse for cutting the rate and
earnings,
"
The
Six
Lord
Lever hulme.
Economic Democracy
is
109
no relation to either real or effective demand. or (3) The price will be cut periodically by dubious management, a constant state of friction engendered, and the whole affair surrounded with an atmoshaving
phere of suspicion.
These results are logical, and to blame any special interest for any of them is beside
the point.
The
ogy and economics, are not considered at with the result that all in such systems the victims make, so far as Trade Unions on
;
on the
own
the
arrangements
protection
against
more
forms of
service.
;
scientific
management, or lukewarm
We
we
have
now
programme
expenditure
of necessaries with a
minimum
of time-energy units.
We
110
substitution
Economic Democracy
of
by natural forces through the agency of machinery and we require is the clear path to this end to co-relate to this a system which will
effort
;
human
distribution
of
possible.
The
may
which represent an
Just Price
(1)
:
Natural
resources
are
common
common
means
also
should
be
property.
(2)
The payment
to
be made to the
the
sum
necessary to enable
him
to
buy
produce
to the
them.
(3)
The payment
to be
made
to be based
on the
rate of decrease
Economic Democracy
of
111
human time-energy
units
resulting
from the improvement, and is to take the form of an extension of facilities for further improvement in the same or
other processes.
(4)
Labour
is.
is
not
exchangeable
to prove these
rests
product
No
attempt will be
since
made
propositions
equity.
It
their
validity
on
of them
tribution
would
of
radically
the
dis-
personnel
in
any
system
of administration.
While the distribution of the product of industry is fundamentally involved, and the inducements to vary the articles produced are clearly modified to a degree which would
profoundly
alter
the
industrial
situation,
no extension
sense
It
is
implied or induced.
that these principles
may be argued
embodi-
112
Economic Democracy
ment but it is, nevertheless, well to bear in mind the imminence of an economic breakdown (as a direct result of the inflation of currency by the capitalisation of negative
;
new economic
system, having
it.
may be
it
(1) that
which
is clearly
an
to
owners.
But
is
it ?
reference
the
accounting process
make
it
clear
that
for
many
the
articles
produced,
and
of
representing,
sort,
some
but
plant
it
is
clearly entitled to
fact that
Economic Democracy
of
its
113
met
the
practicable
evolution
of
better
conception
of
the
community based on
may be worth
which
to
consideration, as a
Let us imagine the theories of rent and wages to be swept away and discredited,
the
existing
industrial
plant
to
be
to
the
property
operating
of
the
community and
technical
be
with
efficiency.
We
with
similar
communities.
without
affecting
programme
is
possible
the
power
to
draw on
the
114
Economic Democracy
to
do work,
of of
its
is
clearly
subject to the
control
real
owners through
Let
us
organisation,
the
agency
this
credit.
imagine
collective
credit
be the
necessary organisation to
to pass upon,
and
if
desirable to
sanction,
any private
involves
respect
any control
once
any
undertaking
Under
community
extent
necessary)
and
it is
every
individual
comprised within
equal
share of product.
in the position of to
an
Bondholder
entitled
an
equal
The
distribution of the
Economic Democracy
product
115
is
adjustment of prices to
bondholder, and
the dimensions of
will
able but
of time-energy units
disposal of the
is
by the
time-factor,
and
let all
adults
on
entering
productive
let
industry
be
so
graded, and
work
production,
(It
and
will
the
success
of
that
the
the
as
proposals.
be
to
noticed
right
strongest
incentive
judgment
116
regards
Economic Democracy
facilities for trial exists here.)
Let
for to
each
say,
class
of
employment
to
that
is
proved
will
ability
render
special
service
to
be
the
qualification
for
facilities
render service,
but
will
Now,
it
will
under these conditions absolute equity both personal and social. All improvement in
process
at the
is
to
the
general
benefit,
while,
same time, the psychological reward of specific ability is exactly that which common experience shows to be the most
perfectly
satisfactory.
No
;
questions
of
lem of administration at all and increased of manufactured product is either bought by increased efficiency or longer working hours while simplicity
complexity
;
of
life
members
Economic Democracy
117
increase
decrease
efficiency,
programmes of
etc.,
production
to
and
in
without
function.
interfering or having
interfere
direction
Economic incentive
pletely,
competition other
and with
it
war.
Economic Democracy
CHAPTER NINE
WHILE
to
much
higher development
progress
is
necessary
is
But a transition period is highly desirable, and as the present structure is susceptible of change by metabolism, it may be well to consider one of the numerous expedients
available to that end.
purchasing
if
power
is
is
absolutely
at all,
essential
industry
to
be kept going
the
is
first
that
wages on the grand scale is simply childish. Given a minimum percentage of profit and a fixed process, under
the existing economic system the real wage,
120
Economic Democracy
proportion of product,
;
in the sense of a
is
steadily
decreasing
fact
and nothing
will
alter
that
except
change of process
tem
real
(permanently).
Even
taxation
of
any
the
sum
duction, even
if
not buy
it,
existent values.
There
is
no doubt what-
first
is
the problem
that what
is
commonly
by the
banker
is
administered
by him primarily
property.
is
most
definitely
it
communal
it
In
its
essence
is
is
the estimate of
has
Economic Democracy
121
mankind has been subjected which have no relation whatever demands of existence, and the
to
fetters
to the real
allocation
Now
it
a measure of the reserve of energy belonging to a community and in conthat real credit
sequence
drafts
on
this
reserve
should
he
If this be borne in mind, together with the conception of " Production " as a con-
it
will
be seen
com-
munal
It
of converted material.
remains to consider
country
how
is
these abstract
So
hand
far as this
concerned, the
the National
may be
War Debt
in all its
122
Economic Democracy
should be clearly under-
forms, although
it
stood that
all
Some
the debt
The 8,000,000,000
which
tion
in
round numbers
for
have
(apart
been
subscribed
its
war
purposes represents as to
major por-
from
about
1,500,000,000
re-lent)
services
dered
the
and paid
sums paid for munitions of all kinds, payment of troops and sums distributed in other pensions and doles. Now, the services have been rendered and the
munitions
loan
expended,
a
lien
activities
consequently,
the
represents
the
future
on of the community,
with
interest
to
say,
the
holders
to
ment, for
for
services
an indefinite period
return
to the Loan.
What
Economic Democracy
Disregarding holdings under
; 1,000
123
and
and financial undertakings who obtained the money to buy by means of the creation and appropriation of credits at the expense of the community through the agency of industrial accounting and bank
large industrial
,
finance.
It is
is
Eventually, to have
any meaning, the loan must be paid off in purchasing power over goods not yet produced, and is, therefore, simply a portion
of the estimated capacity of the nation to
do work which has been hypothecated. Whatever may be said of subscriptions out of wages and salaries, therefore, there
is
as
loan
represents
the
capitalisation
its
it
owners
simply
it
communal
credit transferred to
private account.
124
Economic Democracy
put the matter another way
To
every shell
made and
all
afterwards fired
aeroplane
lost,
built
the stores
stolen or
an entry in his
at 5
books which he
loss
of the
directly
Now,
to
anyone who
should lend,
respect,
and that
Capitalist
in
this
as in
the
usurps
the National
Debt
as
it
stands
is
simply
is
clearly a dis-
Economic l>emocracy
125
Now,
is
which
widely discussed,
is
;
be recognised
a bankers'
that credit
a
let
communal, not
possession
by the same methods suggested in respect of a capital levy so that no holding of over to the end that, 1,000 is permitted
;
with 50 per
power.
And
on
the
a
further, let
production be costed
factory 'cost
all
payments through a credit agency the manner of procedure to this end is described hereafter. Let all payments for materials and plant be made through
;
by making
the Credit
Agency and
addition
let
let
plant increases
be
in
running
debt be
to
the
existing
equally
proper depreciation.
of the
to
Let the
selling price
the
demand by means
fixed
of a
depreciation
rate
on the principle
126
Economic Democracy
let
all
manu-
and agriculture be done, with broad limits, to a programme. Payment for industrial service rendered should be made somewhat on the following lines Let it be assumed that a given production
:
output, which
is
The
would be rated as responsible for a programme over a given time such that this efficiency would be a maximum when
centre
to, say, a
it
standard
is
On
of
this rating
clear
the
amount
can
money
available
for
charges
be
estimated
by
Now
suitable
let
this
sum be
allocated in
proportion
between
the
various
and
to
let
a recognised claim to
promotion be assured
Economic Democracy
127
in
Now,
which a rise
Firstly, there is
is
an immediate
and,
fall
in prices
cumulative,
consequently,
in the purchasing
is
power of money.
effective
Secondly, there
widening of
demand
of
all
financial distribution.
There
is
a sufficient
is
communal
and there is incentive There is the mechanism to efficiency. by which the most suitable technical ability would be employed where it would be most
the agency of credit
;
\iseful,
portion
the
machinery
of
economic
from the processes of production would restore individual initiative, and, under proper conditions, minimise the
distribution
effects of bureaucracy.
possibilities of a
will,
therefore,
128
Economic Democracy
posed
It
structure,
and
is
clearly
the
control
of primary importance.
at this point,
view the
maximum
initiative
final
elimination
either
personal
Economic Democracy
CHAPTER TEN
considering the inadequacy of a mere
IN extension
distributing
of manufacturing production
a modification of the
unaccompanied by
system,
it
in
any
manufacturing
process
enters
a charge
rendered
towards
may be
sidered
and re-appears in the price, for certain items which are really useless, but which form a step the final product. These items conveniently grouped under the
relation to
more complex
cases they
product, although in
many
may
final
product.
if
For instance,
for
lighting,
is
electric
power,
used
final
human
if
used to drive
in the sense in
which the
term
is
130
Economic Democracy
should be obvious that a semiis
Now,
it
of no use to a
consumer
product
if
it
is
used
as
an
ultimate
it
ceases to
come under
the heading
of a semi-manufacture.
an
asset to
products
(which
is
whole object of
and with certain reservations represents an increase of credit-capital but not of wealth. This conception is of the most fundamental importance.
If
we concede
its
validity, a transfer of
between one undertaking and another is measured by a transfer of real credit, and
like
financial
credit
transfer
is
most
Clearing-house.
its
opera-
and Com-
Brown and
Economic Democracy
131
Company who make boots, and Messrs. Robinson who sell them, and let us imagine
that
basis
all
of
commission or
salary
costs,
profit
on
all
labour
and
an
arrangement
which is, however, quite immaterial to the main issue. Messrs. Jones receives raw hides of the datum value of j{jlOO which require semimanufactures value ;500 to turn out as leather, together with the expenditure of
500
in
wages
and
salaries.
Messrs.
by the usual methods from any source which seems to them desirable, and on receipt of the invoices, turn these into the Clearing-house, which issues a cheque
factures
in
amount
The
by
it.
Clearing-house writes up
all
capital
sums issued
is,
The
500.
132
profit
at
Economic Democracy
on
this,
the
factor}'^
;550,
owing
to the
Clearing-house.
Messrs.
Brown who
them from Messrs. Jones, and other supplies from elsewhere amounting to 500, and similarly transmit
for boot-making, order
to
the
Clearing-house,
which
issues
cheque for jl,650 to Messrs. Brown, who, in turn, who pay Messrs. Jones
a
;
retain
;600
to
the
Clearing-house.
Messrs. Jones
are
their
disposed
now own
of
arrangements
respect
of
quantity
made
a profit of 10
,
the leather
boots,
salaries
profit
on
They
receive an order
:
Messrs.
from and
Messrs. Robinson's
own
out-of-pocket cost,
Economic Democracy
133
is
j300 paid
by a
cheque from the Clearing-house for ^2,200 + ^300, ;2,2(X) of which goes to Messrs. Brown, who pay off their debt of 1,650
and
Now
power
sactions
salaries
released
these
tran-
is that represented by wages, and a commission on them, and that no goods have been yet released to consumers against this purchasing power. These sums thus distributed will be largely
expended by the recipients in various forms of consumption, and it is only their joint surplus which will assist in providing an
effective
stock.
for
Messrs.
Robinson's
adjustment.
Let us
invoice,
now
a document
we may
call
a retail clearing
in
its
description
bill
paid
the
let
by the purchaser of an
it
article
;
for
and
134
retail
Economic Democracy
clearing invoice
is
accepted by the
be
we have
and are
of
as
distributed the
left
means of purchase
Brown,
the
cost
Jones
is
or
Robinson,
charged to capital
account.
price be
?
ment
of
average
depreciation
,
of
the
capital assets
of the community
stated in
is
the
money
terms of the
of the
article.
the price
which
it
the
this to
our example
Economic Democracy
135
sum
is
month amounts
into
to
,2,500,
invoices
turned
total
the
Clearing-house
sum. This means that services have been rendered and remunerated by the payment over an indethat
finite
per month
and the product of these services distributed in one month. But the token value
has
a
general
it
purchasing
power,
conse-
quently,
value.
The
rate
equal to the
or
if
it
general
of depreciation,
be
Let us assume
this to
be 40 per
for
imagine that of
community
one
month 60 per
a subsequent period.
price of a pair of boots
Then
the selling
40 per cent,
number
136
Economic Democracy
or would be I of comof
pairs produced)
mercial cost.
in
respect
invoices
own
sum against
cheque originally sent them (out of which they paid Messrs. Brown) recovering the remaining 40 per cent, from the actual purchasers of the boots, and re-imbursing
the
the Clearing-house
who
by
after balancing
Messrs.
down
their
own
credits
that
amount.
financial
credit-capital of the
say,
community
estimate
that
is
is
to
the
to
of
potential
capacity
deliver
goods
written
which
up by 60 per
cent,
of
j2,500,
an accounting reflection
From
factures
semi-manu-
become simply a form of tool power, and are subject to the same treatment as manufacturing plant they are a form of
;
capital assets to
There
is
abso-
Economic Democracy
lutely
137
no difference
in
in
principle
between
a
tool
the
treatment
this
manner of
which wears out in five years' time and a unit of energy which is dissipated in a few
minutes in driving the
tool.
We
turers
employment, by which
are
semi-manufacto
treated
as
;
additions
comas
munal
capital account as
subject to writing
down
they are
actually
consumed
ultimate products.
In order to be effective
take the form of a
a
the writing
cancellation
down must
of
credit-capital,
process
which is done quite simply and automatically by the application to the capital account
of retail clearing invoices in the
manner
which
is
of industry.
is
would be desirable, since the writing down would be done at somewhat longer intervals.
separate
such
assets
138
Economic Democracy
have
We
now
is
where there
effective
direct
relation
as
between
distinct prices.
demand and
relation
prices,
from the
Let us
now imagine
all
single
adjustable
tax applied to
to
the suitable
In existing
present
without
affecting
such a tax would pay the interest on the War Loan many times over. Let
this purpose, the
War Loan
tions
is
from Clearing-house
transfers.
It
would be
while
met by an increased
similar
result.
distribution,
would have a
arrangement
Such
an
to effect, in fact,
from a purely competitive world system to one exhibiting in concrete form the demand for
a transition
Economic Democracy
139
beyond
It
all
proletarian revolt.
may, perhaps,
of pointing
at
this
juncture,
be
extent
out that
affects
no
financial
facts
;
system
by
is
itself
concrete
indicated
the
provision
of
the
right
incentive
to
waste
and
only
is
achieved
brought nearer to
ciples
reality.
Had
the prin-
underlying these
suggestions
been
a
the
war,
we should have
experienced
steady
decrease
of purchasing
power by
have
en-
would
misunderstanding
rate
of
facts
which
quite
now
similar
threatens catastrophe.
The
depreciation
would,
in
manner
which we are familiar in the case of the Bank rate, have been raised at
to that with
140
suitable
Economic Democracy
intervals
to
the neces-
we
arisen.
Economic Democracy
CHAPTER ELEVEN
THE
mankind
society
disaster
;
awful
tragedy
of
waste
and
1919 has brought about a widespread determination that the best efforts of which
is
much
to
would be, if not impossible, unlikely and the major focus of this determination has found a vehicle in the project commonly known as the League of Nations. The immense appeal which the phrase has made to the popular and honest mind
has
lip
made
it
dangerous to
it
;
fail in
is
rendering
certain
service to
but
it
fairly
waged
for the
em-
142
Economic Democracy
The
economic and
culmination
control,
the
policy
all
the evils,
which increasing centralisation of administrative power has shown to be inherent in a power basis of society, would reach in that event their final triumphant climax. But there is no final and inevitable relation between the project of international unity and the policy of centralised control. Just as in the microcosm of the industrial organisation there is no difficulty in conceiving a condition of individual control of poHcy
in the
common
interest,
so in the larger
League of Free Peoples is entirely dependent on the structure by which those interests which individuals
effect of a
and
have in
action.
common
Now,
Economic Democracy
143
it
in vain,
has been
worid to-day is economic, and that the economic system with which we are famihar is exthat the basis of
in the
shown
power
It
League of Nations
is
en-
final survival
which we know
fall
of this
different
superficial
international
organisation.
A
would
survey of the
position
no doubt suggest that the triumph of central control was certain that the power of the machine was never so great and that, whether by the aid of the machine-gun or mere economic elimination, the scattered opponents to the united and coherent focus of financial and military power would within
; ;
finally disappear.
details
144
Economic Democracy
made
that a pyramidal
organisation,
though
is
the
of
all
from within.
We
the
industrial
is
economic
organisation
at
present
com-
demand
involves
as
an instrument by means
is
of which production
failure
distributed.
This
an
in-
the
necessity
of
to
highly de-
further exports.
Now, we
it
is
fairly
clear
are
now
consider-
becomes
the
product
consumed
inside
Economic Democracy
145
The
ances, with
capitaHsation
of
overhead
medium
particular, more and more and as a result individual discontent becomes daily a more formidable It must be evident menace to the system. therefore that an economic system involving forced extrusion of product from the community producing, as an integral component of the machinery for the distribution
of wages
in
ineffective
of purchasing power,
is
entirely incompatible
economic competition
an
effective
war.
Conversely,
by the installation of the cooperative commonwealth in its place makes of war not only a crime, but a blunder. Under such a modification of world policy, inter-change of commodities would
of society, and
take place with immeasurably greater free-
dom
than
at
present,
but on principles
146
Economic Democracy
Trade.
now
struggles
the
privilege
of
con-
verting
raw
material
less
into
manufactured
developed countries.
industry
would
largely
demand waiting
much
case
;
for immediate
consumption than
is
now
the
in
provision
of
distinctive
production.
ceases to
it
of
in pro-
Economic Democracy
gress,
147
i,e.y
employment.
As
a consequence,
this
most important
interests,
field
of constructive
opposing
concerned with an
for nothing.
something
The
inevitable
compromise
no sense a settlement of such questions, any more than the succession of strikes for higher pay and shorter hours, which are based on exactly the same concan be
in
Examples of the same class of difficulty might be multiplied indefinitely, but enough has probably been said to indicate the disruptive nature of the forces at work.
state
To
and misdirection of opinion will make a period of power control inevitable, in order to unite public opinion against it, would be to venture into a form of prophecy for which there is no present justification but it is safe to say, that whether after the lapse of a few months, or of a very few years, the conception of a world governed by the
;
148
Economic Democracy
be
finally
its
dis-
policy
reduced to impotence.
Economic Democracy
CHAPTER TWELVE
AS
are
its
of unrest
to analyse,
and
it
as far as possible
to simplify, the
common
prime movers,
power
capitalistic sys-
and the control of all causes by far the most immediately important and therefore that the distribution of economic power back to the individual is a fundamental postulate of any radical improvement. While this, it would seem, is indisputable, it must not be assumed that by the attainment of individual economic independence, the social problems which are so menacing, would immediately disappear. The re-
tem of
price
fixing,
is
of
proach
is
who
150
insist
Economic Democracy
on the economic basis of society that in them materialism is rampant, and in consequence the bearing of sentiment on these matters is overlooked, and the immense and decisive influence on events which is exerted by such factors is very apt to be ignored. There is a germ of truth in this ;
but
of
if
such
critics will
popular
sentiment,
will
of
economic power
in
this
be seen to predominate
matter
also,
whether
considered
particularly
by
"
those
is
who
that
*'
public opinion
power in public affairs. Assuming that in some sense this may be true, it becomes of interest to consider the nature of this public opinion and the basis from which it proceeds, and it will be
the
decisive
and propaganda.
Now,
In
Economic Democracy
all
its
151
admirable features,
is
nevertheless
an open and unashamed claim to special privilege based on purchasing power and on nothing else and with a sufficient number
;
of exceptions,
efficient
its
product
is
pre-eminently
as
distinct
in
its
own
interest,
from that of the community. It is one of the most hopeful and cheering features of the present day that this defect is increasingly deplored by all the best elements comprised within the system and
;
is
to
But by far the most important instrument used in the moulding of public opinion is
that of organised propaganda either through
moving or otherwise, or the making of speeches and in all these the mobilising capacity of economic power is without
;
doubt immensely
important.
if
not preponderatingly
considered that the expression " of opinion inimical to " vested interests
it is
When
152
Economic Democracy
tremendous difficulty, while a platform can always be found or provided for advocates
of
an
extension
of
economic
privilege,
first
and
in fact
now
is,
recognised,
and
this
from the improper influences which operate their immense capacity for to distort
good.
The
pages
policy suggested
is
in
the foregoing
essentially
at pointing the
way, in so far as
possible
fettered
comsame
aspects of the
of credit
;
by
decentralised
local
authority
the
placing
of the
control
of
Economic Democracy
153
On such
section
the
of
the
Press
would lack
remain
objective.
still
the
task
the
is
concerned, and
it
and democratic
better society
Thus out
154
Economic Democracy
break
a
Dawn
Dawn which
at the best
must show the ravages of storm, but which holds clear for all
to see the promise of
a better
Day.
156
Cecil Palmer
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157
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