GIFT OF i/e V & ', / t00L To My Friend, PERCY WERNER, ESQ. Whose Criticism Has Greatly Aided Me In This Work. COPYRIGHT 1922 BY WILLIAM PRESTON HILL Made in the United States of America ,-> A timely inquiry into: The effect of labor-saving machinery on production, the wages of labor, the distribution of wealth, and the source of the labor fund; together 'with a discussion as to the sagacity or short-sightedness of the indi- vidualist and collectivist points of view, and the wrong or right road to progress By DR. WM. PRESTON HILL ALBA COMPANY 4541 Gibson Ave. St. Louis, Mo. 1922 : : : C: ' INTRODUCTION. Social unrest and discontent among the masses of the people are very evident today among all the civilized nations of the world. Many competent obseivers have ascribed this to the great war, which unsettled the minds of multitudes of people and strengthened the tendency to violence and disorder. But even before the war, there had been for many years a gradual increase of unrest among the workers of all civilized nations. This was due to a variety of causes, some of which date back to the great French Revolution. That mighty upheaval was brought about by the intellectual movement! of the eighteenth century which had slowly but surely undermined the faith of the masses of the people in revealed religion and in the divine right of kings and nobles. This pro- cess had been going on for several generations un- til it had completely sapped the foundations of the old feudal system and it needed only a spark to cause its overthrow. These two beliefs were the moral foundation of the old regime which secured it unquestioning obe- dience on the part of the people and gave it that stability which comes only from the perfect harmony between social consciousness and political and eco- nomic systems. We must clearly recognize the fact that ever since that great revolution which profoundly unsettled INTRODUCTION 5 the minds of men, that stability has not existed in our modern society and there has been a rising tide of democracy all over the world, and a constant agitation of new ideas of all kinds, good, bad, or indifferent, constructive or destructive, judicious or impracticable. These ideas now find eager listeners among all the people. The tremendous development of power- driven machinery has concentrated large masses of industrial workers in cities. This has brought large numbers of them into daily contact with each other where they can discuss the prob- lems of the day. It has increased their mental alert- ness, improved their education, facilitated their ac- cess to sources of information, enabled them to form effective unions and fraternal societies to protect their interests and increase their solidarity and, above all, has multiplied production many fold, which as a natural consequence has also greatly increased wages. All these factors combined have considerably in- creased the social influence and political power of the masses of the people, but it has also filled them with new ambitions and new desires and has opened their ears to the whisperings of discontent and the grotesque flattery of demagogues. Coincident with this, there has been a concen- tration of enormous wealth in the hands of a few and an increase in the class of the idle rich enjoying 522*48 6 INTRODUCTION unearned incomes who have not always used their good fortune with moderation, dignity, or good sense. All this seems unfair to those whose shoulders bear the brunt of industry and who contribute real toil for the wages which they receive out of pro- duction. It was easy therefore for agitators to point out that there are special privileges in our present eco- nomic system which discriminate against the pro- ducing masses and that the workers could by acting collectively abolish these and thereby increase their own prosperity. Also they could secure for them- selves the full product of their labor by having the state controlled by them, own and operate all the means of production and distribution. This pro- gram is attractive and has considerably fanned the smoldering embers of discontent. It is a part of the thought in the background of much of our in- dustrial warfare. f This presents a real danger today which cannot be lightly cast aside. It is extremely foolish for us to attempt to ignore these changed conditions. Judg- ing from the widespread social unrest, our period must be regarded as one of change and it is inevi- table that considerable readjustment must take place in our institutions before we reach that complete harmony between the social consciousness of our people and the established order, which is required to produce stability. INTRODUCTION 7 The question is, in what direction shall the read- justment take place? When we consider the tre- mendous importance of the issues at stake and the immense mass of human happiness or misery de- pending on a right solution of them, even the most careless thinker will perceive the necessity of not jumping at any hasty conclusion. Every true man owes it to himself and his chil- dren to study this question without! prejudice one way or the other and to get at the facts as near as possible. Arguments that are not sustained by the facts- are mere rhetoric and amount to nothing what- ever. We want the facts and in this treatise I have endeavored to present authentic facts and figures and to quote the references where they can be seen an.d let the reader form his own conclusions. We have been too careless in the past in accept- ing plausible eloquence as the truth. This is a mis- take. It is easy enough to criticize the existing order of society; cur institutions in actual operation on a large scale are before us and we have grown fa- miliar with them and easily recognize defects which develop from time to time and which have to be corrected, to meet changing conditions. But how to do this, presents a much more difficult problem. What direction shall the remedy take? Shall it be towards greater collectivism or towards greater freedom of individuality? In what direction do the interests of the working classes lie? 8 INTRODUCTION Can these defects be best eradicated by the com- plete overthrow of the present structure of society? We must find out, first, whether the present sys- tem has such fundamental defects that it is unwork- able without great detriment to the masses of the people. Second, we must find out whether we can- not remedy these defects by the procedure provided by the present system of government for such changes. Third, we must know exactly what we are going to put into its place. We must thoroly satisfy our- selves that the new system has advantages which justify the change and is itself free from other de- fects perhaps just as bad. In short, before overturning the present system we must test the new system with the facts avail- able before us. The history of revolutions in other countries and recently in Russia has convinced every thoughtful man that no matter how justified a revolution may be at the time, it is nevertheless a mighty convul- sion and for the time being at least brings a whole nation face to face with appalling ruin and misery in which millions of people are sure to perish. We cannot afford therefore in a matter of such tremendous consequences to make any mistake that can possibly be avoided by a careful examination of the facts beforehand. Moreover, history has clearly demonstrated that until a fundamental change takes place in the minds INTRODUCTION 9 1 of the people, any progress can be no more than temporary and superficial and therefore a forcible revolution would prove to be not only premature but useless. Progress may seem too slow to suit many impatient minds, but to be permanent it has to be sustained by the public opinion of the great masses of a nation and this changes very slowly. Moreover, we know by experience that in the long run, in spite of all obstacles, public opinion does prevail and the ideas of one age become the law of the next. Our present system of law is the out- growth of the conception of right and justice which prevailed among our ancestors and there is no doubt whatever that the general ideas of equity of the present generation will become the law of the next. It is a certainty, capable of demonstration, that if any considerable modification of the existing ideas of equity should take place among the peo- ple of a nation, it would only be a question of time until that change would be reflected in their laws. Our present system of law is the basis of the estab- lished order now, but the law of the future is even now being created in our very midst by the prevail- ing ideas which recommend themselves to the gen- eral mass of our people at present. No matter how irrational, impracticable or incon- sistent some of these ideas may seem to some of us, they are nevertheless a real force to be reckoned with and which may prove irresistible in the future. 10 INTRODUCTION It is important therefore that full and free dis- cussion shall take place on these subjects, in order that true education shall be obtained and sound opinions formed. False ideas must be met in their own field of thought and confronted with the facts. It is a profound mistake to believe that they can be suppressed by force, policemen's clubs or jail sentences. Force is powerless against an idea. It only advertises it. Ideas can only be overcome by other ideas more truthful and rational. This is the reason for this treatise. I have considered it my duty to contribute to the best of my ability to clear up these ideas. In discussing the question of Socialism vs. Indi- vidualism, the first question that arises is, what is socialism? How do we define it? This is a question difficult to answer, because socialism is a general term which embraces widely conflicting views. Broadly speaking, however, we can say that so- cialism is the opposite to individualism. Socialism means the abolition of the individual private owner- ship of property and replacing it with the common ownership of property by having the title of all property vested in the state. It means a great in- crease of collective action by which the state will own and operate all the means of production, dis- tribution and exchange, thus subordinating individ- ual action almost entirely to the mass action of the whole people. INTRODUCTION 11 The central idea is that the people shall seek their welfare by collective rather than by individual action. The means to accomplish this is, that the working people shall by collective action take pos- session of the Government, establish their own dic- tatorship and use the power of Government thus acquired to accomplish their ends. The chief of which is predicated on the proposition "that all wealth is produced by labor and therefore should belong only to those who toil in its production and that the worker shall receive as wages the full prod- uct of his labor without any profit being deducted from it by anyone." There are numerous shades of opinion among those classed as socialists differing from each other in some detail. To discuss socialism broadly it is necessary to begin with Karl Marx because all socialists until very recently have been) directly or indirectly his followers and have based themselves on his teach- ing. When I began writing this treatise, I was imbued with many radical ideas and I felt impelled to dem- onstrate their truth. But when I came to dig into the facts I was much surprised to find them quite different from what I had believed them to be. Facts are stubborn things which cannot be ignored and will not down at our bidding. Loyalty to the 12 INTRODUCTION truth makes it my duty to give the results of these researches to the public. WM. PRESTON HILL, 4541 Gibson Ave., St. Louis, Mo. The great English scientist, Thomas Huxley, said: "Sit down before a fact like a little child; be prepared to give up every preconceived notion; fol- low it wherever or to whatever it may lead you or you shall learn nothing/* CHAPTER L KARL MARX, THE FOUNDER OF SOCIALISM. Karl Marx in collaboration with Engels may be called the founder of "the International socialist movement," and his work "Capital" has become the bible of the socialists. I say bible because mul- titudes have accepted it with a sort of semi-religious exaltation. In that state of mind, faith is the con- trolling emotion and reason is not active. The general impression of his followeis is thaf Marx was the creator of his ideas and a sort of in- spired prophet. This sentiment has been best ex- pressed by Achille Loria, professor of political econ- omy at the University of Turin, and the foremost protagonist of socialism in Italy. In his work on Marx he says: "Whatever judgment we may feel it necessary to pass upon the doctrines it enunciates it will remain for all time one of the loftiest sum- mits ever climbed by human thought; one of the imperishable monuments to the creative powers of the human mind." To any serious student this statement can only appear to be a wild exaggeration. The truth is that Marx showed little creative power of his own, because few of his ideas were original with him. Most of the ideas set forth in his "Capital" or in any of his other works were discussed at length 14 SHADOW OR SUBSTANCE by : writers who preceded Marx many years, even back as far as Plato, especially by the English writers Godwin, Hall, Thompson and Hodgskin. Even his much-discussed theory of surplus value was origi- nated by William Thompson and thoroly elucidated in his book* published in 1824, when Marx was only 6 years old. In some of his earlier works Marx mentions these English writers and shows that he was fully ac- quainted with their works; but in his "Capital" he does not give them credit for the ideas he bor- rowed from them. Moreover, Marx when he was 30 years old in January, 1 848, in collaboration with Engels issued the famous "Communist Manifesto." Engels had been in business in Manchester where he had become acquainted with the English socialist writers, had in the main adopted their doctrines, and of course he must have acquainted! Marx with them in writing the manifesto. Marx spent all the balance of his life, up to the time of his death 35 years later, in writing his prin- cipal book, "Capital," and left it unfinished at his death. Comparing it with the "Communist Manifesto," we find that altho "Capital" contains an immense Inquiry ii>to the Principles of *the Distribution of Wealth most Conducive to Human Happiness, by William Thompson, jLongman & Co. London, 1824. SOCIALISM OR INDIVIDUALISM 15 mass of details more or less relevant not contained in the Manifesto, yet the latter contains all the essen- tial principles contained in the former except one, the theory of surplus value. "Capital" only gave those ideas more body and weight by multiplying examples and illustrations. So that in 35 years Marx only added one idea, which he found good and borrowed from William Thompson's work, to the ideas he had at 30 years ot age. Most of his time for 35 years was spent in the British Museum patiently and laboriously digging up facts to strengthen his indictment against the ex- isting order of society. The conclusion is frresistible that Marx formed his ideas when he was a young man and spent all the balance of his life, not to learn anything new or to discover the truth but sim- ply to dig up facts to strengthen the opinions he already held and to prove his case. But nevertheless Marx and Engels for the first time assembled a compact, coherent body of social- ist doctrine sufficiently plausible to dominate the minds of multitudes of men, and issued it just at the right moment, in January, 1 848, only a month before the revolution broke out in Paris. They thus became the founders of the modern socialist move- ment and Marx with his "Capital" became its prophet. "Capital" is almost entirely a terrific indictment of the institutions existing at the time Marx began 16 SHADOW OR SUBSTANCE its writing in the early days of power-driven ma- chinery with its extreme and irresponsible individ- ualism. Marx devotes page after page, chapter after chap- ter of almost the entire book to the facts he ac- cumulated to prove that what he calls "Capitalism" is damnable. It is this constant repetition over and over again which exercises its hypnotic spell on the minds of its readers and goads them into fury until finally they are in a frame of mind to say, "Away with this horror, we are ready to accept anything in its place/ Out of this interminable mass of horrible exam- ples, Marx scarcely condescends to devote a few paragraphs to prove that socialism would be a good thing for the new order of society. He assumes the role of a prophet and predicts that socialism must come inevitably, good or bad. whether the people want it or not. He prophesies that capitalism will break down by the sheer force of its own evils, and that then socialism will rise up in its place just as the butter- fly, at a certain stage of its development, emerges from the debris of its previous existence as a chyrs- alis. The Materialistic Interpretation of History. His prediction is founded on what he calls the "Materialistic Interpretation of History," by which he seeks to show that the origin of all our ideas, SOCIALISM OR INDIVIDUALISM 17 philosophies, laws, institutions and even religions can be traced to the material economic conditions in which th^ people have lived. This is a generalization much too broad to stand the test of scrutiny and reason. No doubt the eco- nomic conditions have had considerable influence in shaping our laws and institutions, but on the con- trary it can with equal truth be said that ethical ideas and religions have also had a profound influence in shaping the economic structure of society. It is in the domain of thought that the change' first takes place which determines what the future society shall be. It was the advent of the new religion, Christian- ity, which at first made its way slowly among the slaves, the lowly and the oppressed, which over- threw the old pagan society and determined the future of the Roman world. It was the ethical teachings of Confucius and Laotsze, 2000 years ago which determined the fu- ture structure of China. It was the religion of Mahomet that shaped the destinies of the greater part of Africa, Asia Minor and Hindustan. And finally, it was not the economic conditions of the Middle ages which produced the reformation, but on the contrary it was that intellectual revolt which was the real creator of our modern conditions. 18 SHADOW OR SUBSTANCE Whatever opinions one may entertain of Luther's doctrine, I think that every one will agree that, when he nailed his thesis on the door of the church, he started something which profoundly altered the in- stitutions of Europe. Marx showed a strong inclination to prophesy in his book and there is no doubt that he sincerely believed that all the phenomena of human society could be grasped and the future predicted like a simple mathematical equation, but time has demon- strated that he was wrong both in his premises and conclusions. He was a false prophet who predicted many things, none of which have ever happened in the way he expected. The Law of the Concentration of Capital. He announced this law, and basing himself on that, he predicted that capital would concentrate ; frelf in constantly fewer hands, that the number of capitalists must diminish as the magnitude of enter- prises increased, that the smaller capitalists would be continually broken and driven into the ranks of the proletariat, until, in the course of time there would be numerically only a few large capitalists left on the one hand against the great mass of the working class on the other. He predicted that the same process would take place in land ownership. All these arguments Marx founded on the sup- posed "iron law of wages*' which he accepted from Ricardo, the English economist, as the gospel truth, SOCIALISM OR INDIVIDUALISM 19 out which time has demonstrated to be false and which has been discarded by all leading economists today as untenable. It is true that big businesses have grown bigger, but yet the number of shareholders in them has continually increased instead of diminishing. More- over, the number of smaller firms, instead of being wiped out, has also increased enormously and new ones are being added every day. So that the actual number of capitalists has mul- tiplied many hundred times instead of dwindling to a few as Marx predicted. Also the wage earn- ers who were, according to Marx, going to remain inevitably at the bare level of subsistence and even sink lower and lower, have instead benefited greatly by the general increase of wealth, and their wages and general well being have been enormously im- proved. So that many classes of workers have in- comes greater than most teachers, preachers, pro- fessors, lawyers, bookkeepers, clerks, etc., and con- sider themselves well off, by comparison. The Law of Class Conflict. Marx also announced this law, by which he claimed that the economic interests of the work- ing classes were sharply opposed to that of the capitalist class, and he predicted that this would continually become more and more pronounced un til every man would be either wholly the one or wholly the other. He claimed that the working 20 SHADOW OR SUBSTANCE class, overwhelming in numbers, would be forced by the imperative urge of their economic class in- terests, to combine, first locally, then nationally, then internationally. Then Marx said they will be victorious. Nationalities will disappear. The work- ers will then decree that all land and capital shall be owned in common (to-wit: All private proper- ty shall be confiscated by the state). There will then be only one class left in the world, the working class, and all men will then be (like the heroes in a novel) happy and free forevermore. This is his vision of Utopia. I believe that we can easily dem- onstrate that in the socialist state men will be neither free nor equal, and that they will be actually less free and less equal than they are under the present system. Marx did not prophesy correctly in this respect. The sharpness of the class warfare, far from increas- ing, has not been even maintained and has tended to diminish. There is no clear-cut line of division between capitalists who have everything and work- ers who have nothing. There are many intermediate classes between the very rich and the poor. There are hundreds of thousands of small employers, store-keepers, etc., who are not capitalists to any extent, neither do they belong to the working class altho they work, and there are other thousands of workers who are to some extent capitalists or own their own home or other property, and thousands SOCIALISM OR INDIVIDUALISM 21 of others who own some landed property or farms who cannot be classed as either capitalists or pro- letarians. Altogether it is impossible to divide the people into two sharply distinct groups. Even in Germany, where Marx's theories found the most adherents, the enormous and general in- crease of wealth just before the war among all classes of the people compelled his followers to re- vise their belief in this part of his prophecy. Moreover, nowhere has nationalism tended to give way to internationalism among the workers, as the late war has shown conclusively. And it is precisely in the countries with the greatest develop- ment of capital that the workers command the highest wages and the general mass of the people enjoy much greater and more general well-being than in the countries with less capitalism. It is rea- sonable to believe that the still further development of capital, in any nation, will still further increase the general welfare therein. Therefore capitalism is in no danger of breaking down of its own weight, and when socialism came accidentally, it came into Russia, the least devel- oped capitalist country, and as a result of the com- plete break-down of all civilization due to the war, and not as a result of the high development of cap- italism. 22 SHADOW OR SUBSTANCE The Advent of Communism in Russia. Finally, when communism triumphed in Russia, it was not due to the over development of capital, but actually to the destruction of it and the complete collapse of their economic life due to the terrible strain of the war. Communism followed in the wake of the war even as those other twin scourges of the human race, famine and pestilence, have always followed it, and for the selfsame reasons. And communism, far from restoring the economic life of the nation and bringing back prosperity and happiness to its people, has actually fanned the flames of pestilence and famine into a mighty con- flagration in which millions of people are even now perishing. It has aggravated the ordinary distress usual after a war into an appalling catastrophe, and it has done it for the reasons I shall point out and which could have been easily predicted by any thoughtful man and which were in fact actually pre- dicted by several great writers long ago; notably by Pierre Joseph Proudhon, a French philosopher and writer of great originality, in his * "Resume of the Social Question'* and in his "General Idea of the Revolution of the Nineteenth Century ;** also by Herbert Spencer, the renowned English philos- opher, in his "Coming Slavery,'* and by Frederick Mathews, an English writer, in his 'Taxation and the Distribution of Wealth,*' published just before the war. CHAPTER II. COMMUNISM. After his terrible indictment of capitalism Marx offers us a remedy. He said his program can be stated in a single sentence: The dictatorship of the proletariat, abolition of private property and communism. Many people believe that there is considerable difference between bolshevism, communism and so- cialism and that socialism, for instance, does not aim at complete communal ownership and operation of all property. It is true, that there are very many different shades of opinion among socialists on this subject, and that there are some of them who only advo- cate that the state shall own and operate the most important means of production and distribution with which the great mass of the people come into contact, and shall leave a considerable amount of private property in individual ownership. And there are wry many others who have no sharply defined and clear cut ideas on this ques- tion and simply deceive themselves and others with hazy, indefinite notions and assertions. But Marx himself had no illusions on this point. He knew, as everybody who has studied the ques- 24 SHADOW OR SUBSTANCE tion fundamentally knows, that it is impossible to confiscate the major part of all the property of a nation and at the same time leave here and there scattered portions of it in private hands. Two Systems of Property Ownership. Speaking fundamentally and on broad general lines, there are only two great systems of property ownership possible. First, ownership by individ- uals; and second, communal ownership by the state, community, municipality, group or tribe. The system of property ownership which now prevails in all the civilized nations (except Russia under bolshevism), is the ownership of property by individuals, with the occupation, operation and use of the same by individuals. It is well for readers to keep this definition in mind' and to grasp its full meaning, because much of the discussion of this subject hinges on that point and is made simple by a clear understanding of this fundamental. I am aware that even under the present system we have invented ways by which several individ- uals can own a piece a property together, as when several persons combine to buy a property and have it conveyed to them jointly, each one owning thereafter an undivided interest in the same; and we also have a modified form of family ownership where a property is conveyed to a husband and wife jointly for life with the remainder in their children SOCIALISM OR INDIVIDUALISM 25 after death; and we have ownership in common by large groups of individuals where they form a cor- poration with thousands of shares and the corpora- tion owns and operates large properties. In all the above instances, the individual's right is recognized and he can separate his interest from the group by selling it. We also have under the present system true com- mon ownership by groups of individuals banded together for a mutual purpose, such as religious and monastic orders and various co-operative or be- nevolent societies in which the ownership is in the society and the right of the individual is not recog- nized only in so far as he is a member of that so- ciety. The difference of nation-wide communal own- ership from all the above is considerable, because under it the individual's right is so completely lost sight of as to be practically obliterated. Under it the individual has no feeling of ownership what- ever. Therefore when Plato, the original Utopian, and all those who have followed him, decided that pri- vate property and the selfishness which usually ac- companies it, was responsible for many of the evils of society, they did not have much to choose from. The only alternative to private property, as they thought, was common property, and all Utopians from Plato down to Marx, Bakunin and Kropotkin have had to make the same choice. 26 SHADOW OR SUBSTANCE But in modern times we have discovered that there can be two variations of these two systems of property ownership in regard to its occupation, use and operation. The first is that we can have the title of prop- erty held by individuals and at the same time have the same occupied, used and operated by the com- munity. It is evident that this variation can in the very nature of things only be a temporary expedient when a transition from private to public ownership is being made. The second variation is to have the title of the property vested in the community as a whole and have the same used, operated and occupied by in- dividuals under temporary leases, grants or licenses. This last variation has been especially advocated by Henry George, limited, however, to property in land only. He urged that the rights of individuals td the occupation and use of land remain undis- turbed just as it is at present, but that the actual ownership should be practically resumed by and be vested in the state, representing all the people, using the power of taxation as a weapon to accom- plish this purpose. I have discussed this at length in another work. Marx, therefore, when he decided with Plato and all the other Utopians that private property must SOCIALISM OR INDIVIDUALISM 27 be abolished, naturally had to choose the same alternative which they all did, namely, common property. He did not attempt to analyze it. His mind was so filled with hatred of the existing order th'xt he took it for granted that the opposite system must be the true one and he devoted only a few para- graphs to announcing that it must come. If he had devoted the same energy to analyzing communism that he did to discovering bad exam- ples of capitalism, he would have been less en- thusiastic about his Utopia. Property and Communism. When a man exerts himself to produce something, the motive that impels him is the desire to use or possess the thing produced. This product is what we might call the natural reward for his labor. He feels and the common opinion of mankind has rec* ognized that this should/ be his as against all the world. This is the basis of private property and this desire to produce and possess things is one of the elements of our human nature and has been the mainspring of civilization. In property every man finds the proportionate recompense which justifies his labor. We speak of liberty and property together because a man could not be free if he is not allowed to own that which 28 SHADOW OR SUBSTANCE M produces and to freely sell or exchange it for other things which he wishes. To be free means that a man owns himself, that his powers of mind and body are his very own, as against all the world and that from this ownership of himself by himself, springs his right to own the things which he has made a part of himself by his labor. A slave under the law of slavery does not own himself, he is declared by that law to be the prop- erty of another man, his master, and therefore he did not own the things which his labor produced. In economic terms' a slave was defined to be a per- son who was forced to labor for another and to give up to him all the products of his labor. The ownership of property therefore is the very foundation of our whole economic structure and in its broad simple terms is easily understood. But when we come to trace it through all the com- plexities of our modern industrial system, the con- nection between a man's work and the things he produces is not so clear and definite. In the factory a man works for another man, the 1 owner of the enterprise, who pays him wages for his labor and keeps the actual product for him- self, out of which he of course hopes to and usually does make a profit. SOCIALISM OR INDIVIDUALISM 29 The Theory of Surplus Value. It is this profit that Marx objected to. He claimed that it represented the power of exploita- tion which the employer had by reason of his mo- nopoly of capital and land which enabled him to take the lion's share of the production and that the laborer was forced by his poverty to sell his labor for a pittance barely sufficient to keep him alive. In short, that the laborer was practically what he called a wage-slave (differing but little from a chattel-slave); inasmuch as he was forced to work by the pressure of his economic condition, and that nearly all the product of his labor did not belong to him but became the property of the cap- italist employer, who thus became rich by appro- priating the fruits of the labor of all those who worked for him. This, according to Marx, represented the eco- nomic ascendency of capital, the power it has to squeeze unearned income from the toil and sweat of the workers while at the same time it sinks them into hopeless poverty. This is briefly stated, his theory of "Mehrwert" or surplus value, which he adopted from William Thompson. This contention, at the time Marx made it, was partially true, but he was mistaken in ascribing it to the possession of both capital and land by the employers. Capital in itself has no tendency what- ever to depress the wages of workmen, because it 30 SHADOW OR SUBSTANCE multiplies the enterprises which must have work- men and often employs thousands on a single acre of space and thus directly relieves the pressure of population on land. But the monopoly of natural resources does tend to depress the wages of the laboring classes, be- cause the moment all natural resources pass into private ownership, it shuts them out from the pos- sibility of working for themselves. They then no longer have any choice left. They must work for someone who will employ them or starve. Under these conditions they no longer can make the free, uncoerced bargain about their employment which they would be able to make if they had the alter- native of making a living for themselves on some natural resource. This condition does undoubtedly exert indhect economic pressure on the masses of the people. But Marx failed to figure out that the workers would more than offset this disadvantage by setting up a monopoly of their own by theif unions. A labor union is a monopoly pure and simple, because it restricts the supply of that particular kind of labor, and, by forcing collective bargaining, pre- vents any individual from accepting less than the scale of wages fixed by the union, also by the union- label, by solidarity with other unions, boycotts and other violence against non-union workers it is able to maintain an effective control of its particular field SOCIALISM OR INDIVIDUALISM 3A of labor and force the employers to pay wages higher than would obtain under competition. The true test of a monopoly is the fact that it compel* those who deal with it to pay it tribute in a price which is greater than that which they would pay if the monopoly did not exist. Monopoly, as the French philosopher Proudhon so wisely remarked, is what everybody strenuously objects to when somebody else has it, but which each one strives as hard to secure for himself. The laboiing classes, therefore, met the disad- vantages which they suffered from the monopoly of the land by setting up a more direct and effective monopoly of their own. They were aided in this by the further development of capital, which mul- tiplied the industries requiring labor and made the labor unions more powerful and by making a more intensive use of land lessened the power of land monopoly. Nevertheless, Marx formulated a plausible and alluring theory that seeks to find the blame for our great; inequalities of wealth, and other social ills, in our economic structure itself. It plays on that trait of human nature that makes us inclined to blame everybody and everything else rather than ourselves for our condition. It must be indeed very soothing to multitudes of people to believe that they are poor not because they are ignorant, lazy, shift- 32 SHADOW OR SUBSTANCE less, inefficient or stupid, but because of the work- ing of some mysterious economic forces beyond their control. And it is also no doubt very attract- ive to believe that all we have to do, is to change that complicated structure instead of ourselves, and we will all immediately enjoy the blessings of pros- perity forever more. Nothing to Lose but Their Chains This is the powerful appeal that Marx held out to his followers. With dramatic force he said, "Workers of the world, unite; you have nothing to lose but your chains, and a world to gain." This thrilling slogan sounded plausible enough in some countries like Russia, where an unintelligent despotism seemed to hold the laboring masses, fig- uratively speaking, in economic serfdom, but it was utterly false even there. The millions of Russian workmen have found out that they had much more to lose than the fetters of the Czar. Millions of them lost their lives, millions lost even the small measure of comfort, security and steadiness of em- ployment which they had under the Czar. Millions found out that in the chaos of revolution even the bread of their wives and children disappeared and left them to perish from chronic hunger and dis- ease. Millions lost even the little liberty they had under the Czar of choosing their own time, place and kind of work and place of residence and found SOCIALISM OR INDIVIDUALISM 33 the new and heavier chains of drafted compulsory labor and the tyranny of petty dictators forged upon them. Decidedly the workmen even of Russia had much to lose besides their supposed chains. The workers of more highly developed industrial nations would have much more to lose. They are the chief ben- eficiaries of the industrial plant of a nation and the more highly developed) this is, the better is their general condition. But, on the other hand, they also have more to lose from a breakdown of this industry. Some figures on the ownership of wealth in the United States recently compiled are instructive on this point. It shows that the farmers of this coun- try, numbering 6,561,502, own $41,000,000,- 000.00 That 5,250,000 persons own homes and other real estate in villages, towns and cities esti- mated at $20,000,000,000.00. Fifty million people individually and through in- surance companies, trust companies, savings banks, fraternal societies and other forms of ownership own the railroads, electric lines and other public utility companies. According to the latest report of the Comptroller of Currency of the United States, there were: Savings Accounts In national banks 8,109,242 In mutual savings banks 9,445,327 34 SHADOW OR SUBSTANCE In stock savings banks 1,118,583 In postal savings department 466,109 In trust companies 4,035,422 In state (commercial) banks 8,184,163 A total of 31,358,846 savings accounts in the United States or an average of more than one to each family, with a total deposit of $5,500,000,- 000.00 and there are also 4,500,000 of sharehold- ers in building and loan associations, whose ac- counts are growing by regular deposits every month, and which at maturity will amount to over $10,- 000,000,000.00. There are other thousands who are buying gilt- edge securities on the installment plan; or paying off mortgages by monthly payments. It took just 1 00 years to brin^ the total num- ber of individual savings accounts up to twenty- two millions (1916). But in five more years nine million more accounts were added. The 1921 sav- ings census quoted above was taken during the low point of the depression. There are 2,000,000 who own stock and bonds in industrial enterprises such as United States Steel Corporation, tire and auto companies, etc. Sev- eral million people own United States Government bonds issued during the war and other state, county and municipal bonds.* *I have chosen the above facts from the U. S. Census because it is well known to be reliable and impartial. Those who wish SOCIALISM OR INDIVIDUALISM 35 And this is not all; millions of dollars are in- vested in highways, which belong to all the people, and millions in our school system, in public parks and buildings, swimming pools, baths, libraries, hos- pitals and many other forms of public property which are owned by all the people and is for the use and benefit of all alike. It is perfectly evident from these facts that this country belongs to the many and not to the few. It is however true that a disproportionate share of our national wealth is owned by a comparatively small percentage of our people. In this connection some wild statements have been repeated so often that they have come to be accepted as the truth, namely, that one per cent of our people own ninety per cent of the na- tional wealth. This is so manifestly absurd that it needs no refu- tation. The actual facts are sufficiently serious, however, without exaggeration. They show that about 10 per cent of our people own between 60 and 65 per cent of the nation's wealth. This is a problem that will require our most careful consid- eration. It is not so much the wealth accumulated by the genius and hard work of the original founders of the fortunes which is detrimental. to pursue this line of thought further should reati "Income in the United States," published by the National Bureau of Eco- nomic Research, and they will find much more evidence of the same nature, and better digested and brought down to and in- i eluding 1919, whicfa is {en years later than the census fro.ni which iTiave quoted. A careful reading 6F that treatise will " convince anyone that I have been very moderate and modest in choosing my facts. 36 SHADOW OR SUBSTANCE The harm comes from the tendency to create huge trust estates self perpetuating under able man- agement which continue to shield the beneficiaries from every vicissitude of fortune and even from the consequences of their own folly or incapacity. This too frequently has had the result of creating a class of luxurious idlers of little benefit to themselves or to the nation. It is probable that we will have to revise to some extent our laws regulating the transmission of prop- erty from one generation to another, and also our inheritance taxation so as to bring about a better distribution of wealth and at the same time bring this class back within a reasonable time to the necessity and stimulation of useful work. This will be in reality a blessing to them instead of a hardship. The original American idea that there should be only a few generations from shirt sleeves to shirt sleeves is not a bad one. We can accomplish this with our present laws without any disturbance whatever to our productive industry. I refer only briefly to this phase of the subject be- cause it would take too much space to treat it fully. It has been ably discussed by several writers, no- tably by Harlan E. Read. Without subscribing to some of these extreme views, the facts which they present are worthy of careful study and considera- tion* *The Abolition of Inheritance, by Harlan E. Read. McMillan & Co., New York. SOCIALISM OR INDIVIDUALISM 37 After all, up to the present time, most of the wealth which has fallen into the hands of the com- paratively small number seems to be the superlative result of the tremendous energy and youthful exub- erance of our nation developing our very great nat- ural resources. We cannot afford to put a damper on this or repress it in any way. Our only con- cern need be that conditions of great inequality shall not be perpetuated for generations by careless, short-sighted or unwise laws. But the share of wealth owned by the 90 per cent of our people, though apparently small when ex- pressed in percentages, is nevertheless a very sub- stantial sum of about 80 billions. This is as great as the total national wealth of most of the other great nations of the earth and about as great as our total national wealth was 20 years ago. It is extremely absurd, therefore, to tell the over- whelming majority of the people of this country that they have nothing to lose from the overthrow of the existing industrial system. Marx's idea was that the few whom he called the exploiters were the only ones who could lose anything. I will take up this matter of exploitation a little later. Just now I wish to follow Marx's plan to secure to the workers the full product of their labor. 38 SHADOW OR SUBSTANCE Labor Under Communism. Under communism every worker will work for the state and the state (not he) will own the prod- uct and will distribute it according to the needs of the people. This will be done as the chief officials judge it to be for the best. The great idea, of course, will be that nobody shall be allowed to make a profit and that, in this way, all that the people produce will go back to them without any rake-off subtracted by parasitic capitalists. Therefore all the commodities, food, clothing, etc., will be placed in the storehouses of the state and distributed to the people by cards or otherwise according to their merits, or more often according to their needs. But who is going to decide all this? Who shall determine what kind of work the people shall do. what kind of commodities the state is most In need of, what kind of production shall cease in order that other more necessary articles be produced? All these extremely complicated problems in a na- tion of 100,000,000 people require a tremendous grasp of details far beyond the capacity of any one man or group of men. It would require a very large organization with ramifications everywhere to keep in touch with the needs of the nation. Marx says that of course we will elect these rep- resentatives of the people, who will have charge of all this. Very well, let us concede for the moment that we will elect good men, which we have not SOCIALISM OR INDIVIDUALISM 39 always done, and that they will do their best, which they seldom do. Now, factory production cannot go on efficiently and smoothly if every man is left free to select his own task and do it as he likes. There must be overseers in command who shall see that every man does what he is told and does it in co-ordina- tion with the other workers. In an army we have an officer for every dozen or so privates, but an army is a simple organization compared to a great industry. A foreman, in the latter, must not only have the power to make his men do the allotted task, he must also determine the fitness of his men for the job given them. These foremen, of course, cannot be elected by the men immediately under them, because in that case they would have no authority whatever. They must be appointed by the chiefs higher up. To control millions of workers we will have to have more than a million of petty foremen, under the command of greater chiefs higher up, and over all will be the great national leaders. We begin to see the outlines of a powerful organization. Now the men working under these petty fore- men must obey orders or the whole scheme fails. If they refuse, or do it badly, they cannot be dis- charged, because there is no place to discharge them to, under communism; they must therefore be com- 10 SHADOW OR SUBSTANCE pelled to do it by punishment in some way. The condition of the ordinary individual under com- munism therefore will be that he will belong to a group under a foreman who will determine what he is fitted for, what he shall do and how he shall do it, and with power to make him do it by punish- ment and fix his compensation according to his es- timate. Moreover, he will have no way to get any- thing except from the state and if his food card is withdrawn from himself and his family he and they will surely starve. He would also have to live where another boss shall appoint. Socialist writers have cheerfully informed us that under socialism there will be no sore-eyed book- keepers nor husky, able-bodied shoemakers. If I, for instance, desired to devote myself to medical science and the petty boss over me decided that I was only fit to dig ditches, I would have to dig ditches or starve. Would I in that case do it wil- lingly or well? If then he decided that I was not worth much as a ditch-digger and that I must re- ceive no more than I deserved, what would I have NOTE This is not mere imagination. It actually oc- curred. Dr J. "William Lambie a native of Hammond, N. Y., graduated in dentistry at the University of Pa., settled in Russia 33 years ago. He became wealthy as the dentist of the late Grand Duke Michael. After the Revolution, the Bolsheviki confiscated all his for- tune and put him into jail for months. Then on releasing him, because guiltless, they decided that his services as dentist were not needed and they put him to work scrubbing floors, a poor scrubman, he gets barely suf- ficient to maintain life. His sister, Mrs. S. C. Mc- Lennan of Syracuse, N. Y. through our department of State is trying to secure his release and return here. SOCIALISM OR INDIVIDUALISM 41 in life that the slave did not have? Under these conditions will the common man be free or will he come under the definition of a slave? And if this petty boss conceives a grudge against him (as we know they sometimes do), will he not have the power to satisfy his spite and will he fail to do it? Will the common worker be on an equality with his petty boss or all the other bosses? Communism therefore is compelled to resort to compulsory labor, to an industry determined and dictated by political bosses, to an arbitrary and capricious distribution of goods, to a predetermined and arbitrary mode and place of living and to the tyranny of millions of petty bosses either appointed or elected by ballot. Marx's piomises therefore were to make the working people equal, independent and free by abolishing private property; but the actual result of his scheme has been to substitute for it a system that establishes universal slavery and the most in- tolerable inequality and injustice. But this is not all. The most immediate and dis- astrous result of communism is to strangle produc- tion. Communism Strangles Production. When we destroy a man's ambition by making it impossible for him to own anything of his own or 42 SHADOW OR SUBSTANCE to get ahead in any way, no matter how hard he strives, we at once take away from him the incen- tive to work. He becomes an unwilling worker, with all which that implies. Homer, the ancient Greek, said: 'The day that makes a man a slave takes half his worth away." Under communism the good will of his boss is more important to a worker than anything he can do for himself. This was the economic defect of slavery. Slaves did not produce with intelligent, willing hands. Moreover, great industries are usually built up by the courage, energy, perseverance and thrift of some one man. Such men are the product of an environment of liberty, of individual initiative and struggle against circumstances and competitors. They are spurred on by ambition to secure a great reward, and under our existing system they some- times get it (if they succeed), but we say nothing ot those who fail. Communism could never develop such exceptional men because it offers them nothing to stimulate their ambition and the whole atmos- phere of government control and regulation is fatal to individual enterprise and energy. If in spite of all handicapa under communism such a man should appear, he would still have over him some political boss who has been elected more by popularity than by merit and whose product is eloquence rather than goods. But without these captains, industry languishes SOCIALISM OR INDIVIDUALISM 43 and production dwindles. Moreover, they are the very ones who, according to Marx, were exploiting the working class and getting rich by making a profit out of their labor. "Away with them, he says. Com- munism must destroy these enemies of trie people in order that the workingman shall at last get all the product of his own labor." That is what actually happened in Russia. They murdered thousands of these factory owners, man- agers and experts and drove other thousands into exile, under the delusion that only those who work with their hands were producers, and they put the workingmen in charge of the works. And then they discovered that the ignorant agi- tator could not run the factory, that production did not thrive, that the surplus disappeared as if by magic and quickly reduced the individual worker to a starvation basis. And when H. G. Wells, the English writer, formerly a socialist, and who still calls himself a collectivist, went there two years later in order to admire; their system, the leaders admitted to him (that which indeed they could not hide), that all the people in the nation were in des- perate need of everything, food, clothing, shelter, transportation and all the necessities of life. Many perfectly disinterested travelers have noted that there has been an almost complete disappear- ance of all household goods, even bedsteads, mat- tresses, bed clothing, etc., as if a marauding army 44 SHADOW OR SUBSTANCE had sacked the whole country. But badly as they needed all these things, they needed these very industrial managers and experts to take charge again of production and transporta- tion and re-establish efficient methods and the problem was, how to bring them back under com- tnunism. And then a year later an accidental drought brought on the catastrophe. This should have been expected and foreseen, because Russia has always had periodic droughts, but, under the government of the Czar, the peasants produced large surpluses of food for export, and transporta- tion was sufficiently effective to carry the surplus of other sections into the stricken territory and tide it over till the next harvest. But under bolshevism, the peasants got tired of being plundered out of their crops and had ceased to cultivate except for their own immediate needs, and thus even before the drought the whole na- tion was on a hunger basis and the drought con- verted it into actual famine and literally drove mil- lions of people headlong from their homes in a des- perate search for food. The scenes of horror which took place in that terrible famine have appalled the entire world and would tax the descriptive powers of Dante himself. Note: Many of the American relief workers reported! that at every station far away from the SOCIALISM OR INDIVIDUALISM 45 seat of the famine, they were besieged by thousands of miserable people begging for a crust of bread, and that in the famine area itself the people had resorted to cannibalism. This has forced even the fanatic leaders to re- tract a part of their communism and confess that they did not know *'it was loaded." They now hold out the beggar's hand to the hated capitalists and ask them to come and save Russia from the terrible abyss into which they have plunged her. Bolshevism the Main Cause of the Catastrophe* There are many who sincerely believe that this catastrophe in Russia is not the inevitable result of the socialist revolution, but was produced by other causes, such as the world war, the civil wars, the al- lied blockade, etc. These no doubt contributed their share of destruction, but they were small fac- tors when compared to bolshevism itself. The official platform and statutes adopted by the communist Internationale and reported in the Isvestia, the official organ of the Soviet, demon- strates this beyond a shadow of doubt. It reads as follows: "The victory of socialism over capitalism, as the first step to communism, demands the* accomplish- ment of the following tasks by the working people as the only revolutionary class. 46 SHADOW OR SUBSTANCE 'The first is to lay low the exploiters and first of all the bourgeoisie as their chief economic and po- litical representatives; to completely defeat them; to crush their resistance. "Only a violent defeat of the bourgeosie, the con- fiscation of their property, the annihilation of the entire bourgeois government from top to bottom, parliamentary, juridical, military, beaurocratic, ad- ministrative, municipal, etc. Only such measures will be able to guarantee the complete submission of the whole class of the exploiters. "The preparation of the dictatorship of the prole- tariat demands the replacing of the old leaders by communists, in all kinds of proletarian organiza- tions. "It is necessary to remove all the representatives of the labor aristocracy, or such bourgeois work- men, from their posts and replace them by even inexperienced workmen, in sympathy with the ex- ploited masses. The dictatorship of the proleta- riat will demand the appointment of such inexperi- enced workmen to the most responsible positions, otherwise the labor government will be powerless." Here you have the program of destruction in all its simplicity. The dictatorship of the inexperienced, the ignor- ant and the incapable and the complete destruction of all the bourgeois, which means all the class which has intelligence and has therefore accumulated any SOCIALISM OR INDIVIDUALISM 47 property, much or little. The moment such a program is decreed in a nation, with the abolition of private property, then the whole nation is turned from production into looting, murder and destruction. All the prison doors were of course opened, because all the crim- inal classes were simply offenders against the bour- geois government and morals, and were regarded favorably by the Bolsheviki. These criminal classes were turned loose with the sanction of the new law to plunder those who had anything. They were of course reinforced by all those who were only restrained formerly by fear of punishment. Pro- duction of course ceased almost at once, because who would care to work at some hard task when it is more interesting and profitable to plunder the enemies of the new revolution, and these of course were all those who had any property. For instance coal mines ceased to be operated under that system because digging coal is very irksome labor and no- body will do it except under necessity. In a cold country like Russia, fuel soon becomes scarce when production ceases, but the communists need not suffer when they can seize the personal property of the bourgeoisie and burn up their tables, chairs, bedsteads, etc. Moreover all semi-public property at once ceases to belong to anybody in particular and can be seized 48 SHADOW OR SUBSTANCE by the first who comes along. Thus thousands of freight cars on sidings everywhere were destroyed to provide fuel for the people and even wooden blocks were torn up from the streets for that pur- pose. Transportation was, of course, immediately de- moralized under such conditions, and all the social activities which depended on it were broken down along with it. Communism Destructive to Agriculture. But the most direct effect of the Bolshevist scheme was on agriculture and we can quote Lenin himself on that point as published in The Isvestia, the official organ of the Soviet leaders. The introductory declaration of the communist party resolution on this subject is illuminating. It reads as follows: "No one but the city industrial proletariat, led by the communist party, can save the laboring masses in the country from the pressure of capital- ism and landlordism.'* How they propose! to do this is explained further on as follows: "The revolutionary proletariat must proceed to an immediate and unconditional confis- cation of the estates of the landowners/* After the proletarian coup d*etat not only the confiscation of the landed estates shall become ab- solutely necessary but also the banishment or intern- SOCIALISM OR INDIVIDUALISM 49 ment of all the landowners." "The proletarians must put up with a temporary decline in production so long as it makes for the success of the revolution." But this decline of production did not prove to be temporary at all. It was found to be a perma- nent feature of Bolshevism and it got worse and worse and by the spring of 192 1/ conditions had become so acute that Lenin addressing his followers before the all-Russian communist convention said: "We must take most immediate, most urgent, most extreme measures for the improvement of the condi- tions of the peasantry and the raising of itsi produc- tive forces." "The trouble with our peculiar military commu- nism consisted in that we practically took from the peasants all the superfluous foodstuffs and even sometimes part of what the peasant really needed for himself, for the needs of the army and the work- ers in the cities." He also spoke of the lack of farm animals which prevented the transport of firewood, our chief fuel, by the peasant's horses. Any sane man of ordinary intelligence could eas- ily have foreseen that the banishment or imprison- ment of all farmers who knew anything about farm- 50 SHADOW OR SUBSTANCE ing, the confiscation of all their property and the commanded ing of their farm animals would surely paralyze the greater part of agricultural production. Also that you could not expect the peasants to continue to produce, when they were robbed of even what was necessary for their own needs and of the grain necessary for seed. No surer scheme could possibly have been de- vised that would so quickly reduce the whole nation to a hunger basis. But the interesting thing is that the Bolsheviki themselves foresaw it, but thought it would be only temporary; and that Lenin himself now admits it. The communist leaders found it comparatively easy to prod the; city workmen in the back with soldiers' bayonets but the peasants in the country were far too numerous and scattered to be reached by that gentle manner of persuasion. It would have taken millions more of soldiers in the red army to reach the 1 40 millions of peasants and this sheer physical fact compelled the communists to conceed that the peasants must be allowed to work indi- vidually in their own way. Annual Production the Main Wealth of a Nation. John Stuart Mill demonstrated that the main wealth of a nation consists almost entirely of its an- nual production. The little accumulated personal property and permanent improvements of the past SOCIALISM OR INDIVIDUALISM 51 are wholly insignificant when compared to the an- nual production. When a people therefore is turned from this an- nual production to loot and consume the little ac- cumulation of the past, it is soon dissipated and the whole nation is quickly reduced to abject misery from cold, hunger and disease. In their abysmal ignorance these bolsheviki imagined that because some so-called bourgeois and a few aristocrats lived in comfort on their incomes that all they had to do was to take it away from them and then all the people could enjoy the same ease. They failed to realize first that this class constituted only an infinitesimal small number compared to the immense mass of the people and that if all the incomes of all the aristocrats and bourgeosie combined should be distributed among the people it would only contrib- ute a small addition to the income of each one of the many millions of workers. And second that the wealth of the privileged classes consists mainly of paper titles which enables them to receive a share of the annual production and that when this annual production ceases all this wealth disappears as if by magic. In other words, the main trouble in Russia was not so much the wealth enjoyed by a small class as the fact that the whole nation suffered from poverty due to scanty production. If the great masses of the people had received every bit of the annual 52 SHADOW OR SUBSTANCE production of the nation they would still have been miserably poor and the total elimination of the in- comes of the wealthy class would have been scarcely noticed in the total result. The main struggle, therefore, of the Russian people, considering them as a unit, was against the forces of nature and their hard environment. In this struggle they were great- ly aided by the guidance and intelligence of the small wealthy class which unquestionably contrib- uted fully as much to the total result as they re- ceived from it. The masses destroyed this class in order to seize what they had, but in doing so, they lost by the diminished efficiency of production in- comparably more than they gained. It is perfectly evident that the introduction of such a system in the United States even now would precipitate a greater catastrophe than it did in Rus- sia because we are a more highly developed indus- trial nation and more of our people are dependent for existence on the regular processes of produc- tion and distribution. The population of the whole Russian Empire just before the war, was according to the Czar's census of 1910 and the estimates of increase up to 1914 about 1 78,000,000. It was estimated that the pop- ulation of Russia had shrunk about 10,000,000 by reason of the world war and by the decrease in births and increase in death rate, so that at the out- break of the Revolution it was about 168,000,000. The Russian Soviet authorities took a census of SOCIALISM OR INDIVIDUALISM 53 Russia and of the federated republics and terri- tories under their control in August, 1920. The results of this census were reported in the third Rus- sian census publication by M. W. Mikhailovsky, director of the central statistical bureau of the cen- sus, and also by Dr. A. N. Syssin, head of the Peo- ple's Health Commissariat of the Soviet Govern- ment. These facts were translated and republished in the "Epidemilogical Intelligence'* published by the Health section of the League of Nations and also reviewed in the Public Health Reports of our Gov- ernment (Washington, D. C.). Dr. Syssin compiled the official total population of Russia and all fed- erated republics and territories under the Soviet regime or affiliated with it, in August, 1920, about three and one-half years after the Revolution* as 131,546,000. This is about 36,450,000 less than the estimate in 1 9 1 7. A part of this shrinkage was due to the loss of territory suffered by Russia after the war which made Finland, Esthonia, Lat- via, Lithuania and Poland independent states and annexed Bessarabia to Roumania and also took away part of Trans-Caucasian territory. The loss of population from this source was in round figures about 18,450,00, which, deducted from the 36,- 450,000, leaves about 18,000,000 actual shrinkage of population in the territory ruled or controlled by the Russian Communist Soviet. A part of this shrinkage is accounted for by the emigration of millions who made their escape into 54 SHADOW OR SUBSTANCE foreign countries. M. Mikhailovsky estimates this loss at between two and three millions of people. He also esti- mates that about one million lost their lives in the civil wars and commotions by murder and other violence. The figures of the census which give the males as 61,029,000 and the females at 70,517,- 000, or an excess of about 9,500,000 females over males, are highly suggestive of wholesale violence and disorder, which naturally kills off the males faster than the females. This leaves a shrinkage from natural causes, such as disease, starvation, etc., of about 15,000,000 in the population of Soviet Russia in the H/z years of Communist rule up to August, 1920. The official figures given by both Dr. Syssin and M. Mikhailovsky abundantly ex- plain this loss. They show by the vital statistics compiled all over Russia that the death rate in 1920 had reached the awful figure of 55.8 per 1 000 of the population, as against a death rate of 25.4 per 1000 before the war. And at the same time the birth rate, which be- fore the war had been as high as 45 per 1 000, had shrunk in 1920 to 24.6 per thousand. So that the deaths were more than twice as great as the births. This shrinkage of about 30 per 1000 of pop- ulation every year computed over the entire pop- ulation of Soviet Russia would show a loss of about 3,930,000 people a year, and abundantly explains the decrease of 15,000,000 population in about 3 vears of Soviet Rule. SOCIALISM OR INDIVIDUALISM 55 More than half the .deaths were due to infectious diseases, of which typhus fever accounted for 27.4 per cent, pneumonia 9.1 per cent, tuberculosis 6.5 per cent, dysentery 4.6 per cent and starvation 4.4 per cent. The city of Orel is a typical example of the shrinkage of population. It had in 1913 a pop- ulation of 97,200 and in 1920 the population was 63,800, or a loss of 33,400, which is more than one-third. In 1920 the births in that city num- bered 1044 and the deaths 3559, which caused a loss of 2515 and showed that they were dying more than three times as fast as they were being reproduced. These vital statistics are simply ap- palling. The old, the infirm, the young children, the feeble and the invalids all die in increasing numbers under these conditions. Since this census was taken, the great famine in the Volga region took place, in which millions per- ished by actual starvation and the population re- verted to cannibalism in many places. Also three great epidemics took place, one of typhus fever in which Dr. Copeland, who visited the stricken area last summer, estimated that there had been millions of cases of typhus with a large percentage of mortality, another of Asiatic Cholera and dysen- tery and another of influenza with its accompanying pneumonia. All these reaped their harvest of death. Only the strongest individuals are able to survive in the acute conditions of misery which pervail. The 56 SHADOW OR SUBSTANCE population of Petrograd which was over 2,000,000 before the war, had shrunk to about 600,000 in 1921 and all the other cities except Moscow, the capital, were falling into similar decay, actually dy- ing before our eyes. This process is continuing and Russia is reverting to a primitive peasant nation such as it was in the 1 6th century. Under that con- dition it will not be able to support more than about 40,000,000 people in the whole empire and all the other 100,000,000 people will be superfluous and have to die by misery, disease, famine, pestilence, murder or cannibalism. And yet the friends of Soviet Russia are trying to persuade us that all is well in this wonderful Utopia and that we should make haste to imitate them and get into the same con- dition. In the United States 1 00,000,000 people are able to live only because of the regular process of pro- duction and distribution. The sudden interruption of these and the destruction of our modern indus- trial organization would undoubtedly condemn mil- lions upon millions of our people to death in some form or other. Under a more primitive peasant or- ganization our country would support only a scant 20,000,000 people and the other 80,000,000 peo- ple would be superfluous and have to perish. Such a result would be the most appalling catastrophe that has ever taken place in human history, and yet there are a few deluded radicals who are thought- lessly and carelessly trying to bring it about. SOCIALISM OR INDIVIDUALISM 57 To apply a well known parable: "And Satan (personifying the powers of evil) took a people up on a mountain and spread before them a mirage of wealth and luxury and said, "All these are yours if you will bow down and worship me." But Jesus, in a similar situation, replied: "Get thee behind me, Satan; what does it profit a man to gain the whole world if he lo.ses his own soul?" This greatest of ethical teachers knew that the victim only imagines that he is going to gain the whole world when he sacrifices his own soul for it* In reality he is being double crossed by the forces of evil, and he loses not only his own soul, but every- thing else along with it, and reaps a harvest of death besides. The Russian Bolsheviki, however, yielded to the temptation and reached out for the ignis fatuus of plunder, and behold! the mirage vanished and the alluring plunder turned like the apples of Sodom to dust and ashes at their touch. But some radicals may object that they do not desire to go to the extremes of the Bolsheviki and that they only desire to bring about their system by moderate steps. In other words, they will make it less painful by cutting off the dog's tail an inch at a time instead of at one stroke. The Inevitable Result of Revolution. Let no one deceive himself on this point. When a revolution is under full headway it is inevitable that it will go to the utmost extremes. In a gen- 68 SHADOW OR SUBSTANCE eral state of popular excitement it is certain that the most excited will come out on top. The orators who advocate moderation, restraint and common sense, will not be considered eloquent. They will likely receive rotten eggs and brickbats rather than applause, and the frenzied paranoiacs or dema- gogues will be acclaimed as the real leaders. The name Bolsheviki means those that demand the max- imum, the extremists. When the Czar was over- thrown by the revolt of the army, it was not only his government that was overthrown, it was the whole authority of law, the basis of the whole so- ciety. Everybody felt at once that he was free from all the restraints imposed on him previously. The whole of Russia became a debating society on every street corner, and it was inevitable that final- ly those who were most frenzied and who prom- ised the most should be carried into power by the populace. No workman could understand why he should work now that he was free. They were compelled to work under the Czar, then what was the use of being free if they had to work just the same after getting rid of the Czar? All taxes ceased to be paid because the tax gath- erers were regarded as the agents of the Czar and the new government had to sustain itself by issues of unlimited paper money. The weak Kerensky and his colleagues imagined that they could hold the revolution in moderation SOCIALISM OR INDIVIDUALISM 59 while they built up the new government, but it was an idle dream. The only way that this could have been done was to at once! sternly restore the su- premacy of tba law and they were partly unwilling and partly unable to do that. The parlor radicals, who talk so lightly of rev- olution, should seriously reconsider their conclu- sions. A revolution which merely transfers polit- ical power from one group to another must not be confounded with one which completely sweeps away all the authority of law on which the whole social structure rests. Such a revolution, once set in motion, gathers momentum and is not easily checked until the whole nation is hurled into the abyss. As the great philosophic historian Macau- lay pointed out, once a nation is started on that downward course there is nothing to stop it except the accidental appearance of a superman. Either a Caesar or Napoleon will seize the reins of power and restore order or else both civilization and lib- erty will perish and we will be as fearfully ravaged by the barbarians of the twentieth century as Rome was in the fifth. With the only difference that the Huns and Vandals who ravaged Rome came from without while our barbarians will come from within our very midst, for in the vicinity of our finest edi- fices, within the very shadow of our noblest cathed- rals lurk savages fiercer than any who followed Genseric and barbarians more terrible than those led by Attila. CHAPTER HI. CAPITALISM. Exploitation or Construction. When law and order are restored in Russia, if men with capital, energy and enterprise will go into Russia, buy the ruined factories, organize industry into efficient working order and get the people to work steadily at a wage which conditions will jus- tify, leaving, of course, a profit for themselves, will they be exploiting or benefitting the working peo- ple? Is the man who takes that risk and undergoes that worry, trouble and personal effort entitled to a profit or not? Does the profit come out of the worker or does it come out of the greater efficiency of industry? Does a system which enables a worker to work at a wage greater than he could make working for himself, exploit or benefit him? Less than twenty-five per cent of the world's people live in fully developed capitalist countries and it is precisely in these that the wages are high- est and that the general well being of the people is incomparably better than in the balance of the world. . Capital multiplies the productive power of human labor, it expresses itself in power-driven machinery and efficient industrial development, and gives a SOCIALISM OR INDIVIDUALISM 61 nation an abundance of everything conducive to human welfare. Will anybody contend that the workers are not benefited by this as much or more than any one else? Workers Benefited by Capitalism. According to the United States Census Reports of 1910, Vol. VIII, page 129, there was then used by the manufacturers of this country power-driven machinery amounting to 18,675,376 horse-power, which was their property. It is estimated that this machinery did work equivalent to that of 90,000,- 000 men working by hand. That report also tells us that these manufacturers at that time had 6,500,000 working men employed by them. So that the manufacturers may be said to have had about 1 4 times as many mechanical workers with steel nerves and muscles working for them as they had human workers. Did the man- ufacturers get 1 4 times as much of the product as their human employees? This would be the case if they got the full benefit of their ownership of their steel machines. But this is far from being the true fact. Instead of getting fourteen times as much, the return to the manufacturers was only about half as much as the wages they paid to their working people. In fact, the return to the capitalist manufacturers was only about twelve per cent on their invested 62 SHADOW OR SUBSTANCE capital. When we consider that machinery be- comes worn out and obsolete in a few years and has to be scrapped on an average every ten years, and as John Stuart Mill said in his political economy that capital is kept in existence from age to age not by preservation but by perpetual reproduction, and that every part of it is used and destroyed gen- erally very soon after it is produced, we cannot consider a return of twelve per cent annually as anything more than sufficient margin to secure the continuous reoroduction of the machinery worn out and the development of the new machinery required by invention. The truth is that this margin is so small that all the manufacturers have to exercise unusual vigi- lance, prudence and foresight to keep it on the right side and it is also the reason why so many of them fail. How long would this margin last, if instead of the trained experts who now manage the factor- ies, we would turn the management over to politic- ians elected by ballot? How long would it take walking delegates, whose specialty is eloquence rather than work, to turn this margin into a deficit? Would the laborers even if they took over the factories and worked for themselves be able to get along with less than this twelve per cent margin? Let us compare them to farmers, who are mostly now working for themselves, and yet the power they use in production in the shape of mules, horses, oxen, tractors, etc., has cost them much more than SOCIALISM OR INDIVIDUALISM 63 twenty per cent. We cannot avoid the conclusion, therefore, that the lion's share of the benefit from power-driven machinery has gone to the work- ing classes and that by far the greater part of it, has gone into increased wages for them. Fortu- nately, we can prove this by actual facts beyond the possibility of doubt. England's Condition in 1850 and 50 Years Later. Let us compare the condition of England in 1 850, when Karl Marx began writing his ''Capital" and when production by power-driven machinery was just getting under full headway, and its condition fifty years later, and we find that there was a very remarkable progress in all the arts, sciences, indus- try and transportation. Numberless factories were developed, production multiplied many fold, and the railroad transportation system was created and developed to a high efficiency. Transportation by water was also practically re-created by the build- ing of immense iron steamships, and great seaports were constructed. All this was progress in a high degree. Now what was the effect of all this on the work- ing masses of the people? Judged by every standard, the general well be- ing of the masses of the people was very much better in 1901 than it was fifty years before. If the general level of wages in 1851 be taken as the standard and placed at 1 00, then we find that 64 SHADOW OR SUBSTANCE by comparison the general level in 1901 would stand at 181.7, or an increase of 81.7 per cent, and in a great many industries, wages had more than doubled. The deposits of the savings banks deal- ing with the working classes increased from 29,- 000,000 pounds sterling in 1851 to 257,000,000 pounds sterling in 1901, an increase of 800 per cent. The friendly societies, which had barely started in 1850 and which had reached a capital of only 14,000,000 pounds sterling in 1877, had increased to 45,000,000 pounds sterling in 1901. The great co-operative societies built up exclu- sively by the working classes, which were mere in- fants in 1850, had increased to 8,500,000 pounds sterling in 1883, and still further increased to 45,- 350,000 pounds sterling in 1909. Inhabited houses increased from 3,278,039 in 1851 to 6,260,852 in 1901, showing a very con- siderable increase of families occupying separate houses. The marriage rate is a fair index of increased prosperity; it was 1413 per 100,000 in 1851 and 1615 per 100,000 in 1901. But the clearest demonstration we have that pov- erty had decreased, is the poor law statistics. These show that the percentage of paupers in 1859 was 41.8 per 1000 and that it decreased to 22.6 per 1000 in 1905. All these facts are found in the En- cyclopedia Britannica of 1910 under the titles of SOCIALISM OR INDIVIDUALISM 65 England and Charity and Charities and in the cen- sus reports of Great Britain, 1851 and 1901. This is the clearest demonstration that the work- ing classes of England were greatly benefited by the development of power-driven machinery in those fifty years, and this was in spite of the fact that dur- ing that same period the population of England increased from 17,927,607 in 1851 to 32,327,643 in 1901, in an area of 58,324 square miles, or from 307 to the square mile in 1851 to 557 per square mile in 1901. Under ordinary conditions this enormous increase of population in that limited area would have had a tendency to greatly in- crease the pressure of population upon the land and to aggravate the condition of the masses and to accentuate pauperism, but this was entirely over- come by the tremendous development of industry and the benefits which it brought to the working classes. False Statement in Propaganda. A great deal of the propaganda of discontent in this and other countries has been based upon the careless thinking and preposterous statements of ignorant agitators which nobody has taken the trou- ble to contradict with the true facts. One of the most common statements made and repeated every- where by soap box orators until it has passed for the truth is that the wage workers in this country produce about six times as much as they receive in wages and that the capitalist class receives as its 66 SHADOW OR SUBSTANCE share this enormous percentage of the product, and the United States Census is given as authority for this statement. The True Facts From U. S. Census. On page 1 29 of Vol. VIII of the United States Census Reports of 1910 we discovered how ab- surdly false this statement is and also how it origi- nated. It gives total production of manufacturers in 1909 as $20,672,051,870.00 Total expenses of manufactur- ers in producing said prod- uct $18,454,089,599.00 Gross balance remaining to manufacturers $ 2,217,962.271.00 The total expenses are divided up as follows: Paid out for the raw materials used in above production.... $1 2,1 42,790,878.00 Wages paid to wasre-workers engaged in this production.. 3,427,037,884.00 Salaries, etc., and other over- head expenses 2,884,260,837.00 Total : ..$1 8,454,089,599.00 Now while it is true, as we see above, that the gross product is about six times, in value, the wages paid to the wage working class, yet it is utterly false to draw the conclusion that the capitalists received that as their share. Before that gross product can be produced at all, the raw materials must be bought and paid for, all the other expenses have to be met SOCIALISM OR INDIVIDUALISM 67 and the wages of labor have to be paid. The cap- italist owners therefore receive as their share only the net return after all these expenses are deducted from the gross product. The ignorant, dishonest or careless soap box agi- tator never stopped to analyze these figures and either overlooked or ignored these necessary items of expense and jumped to the conclusion that the wage working class were creating six times as much wealth as they were receiving in wages. To do that they would have had to create it out of nothinsr, whereas the true facts are that the en- tire manufacturing: plant took: Raw material worth $12,142,790,878.00 And converted it into finished product worth $20,672,051,870.00 And therefore added a value to the raw material amount- ing to $ 8,530,660,992.00 In creating this additional val- ue, however, and in selling the product certain unavoid- able expenses had to be met. Taxes paid to federal, state and municipal governments.. $ 351,309,449.00 Rent for buildings, factories and warehouses 106,573,661.00 Work paid for under contract 1 78,645,635.00 Other expenses, rent of offices and salesrooms, rent of ma- 68 SHADOW OR SUBSTANCE chinery, royalties, use of pat- ents, insurance, advertising; traveling expenses, salesmen and all other sundry exp 1,309,157,125.00 Total of these expenses $ 1,945,685,870.00 Deducting expenses from the..$ 8,530,660,992.00 We have the net value added bv manufacture 6,584,975,122.00 This net value added by the process of man- ufacture was divided as follows: Wages paid to the wage earning class $3,427,037,884.00 Salaries to other classes of em- ployees, clerks, salesmen, managers, engineers, book- keepers, experts, officers of corporation, superintendents, etc $ 938,574,967.00 Total wages and salaries pd.$4,365,61 2,85 1 .00 Return to capitalist owners.... $2, 2 1 7,962,281 .00 To analyze the above figures graphically in per- centages we find that the total product of man- ufacture is made up as follows: 60% goes to raw material; 21 % to wages of labor and salaries of employees; 8% to other sundry expenses, such as taxes, rent, insurance, adv. and selling. 89% is the total in expenses, and that the owners get 1 1 % of the total production as profit. SOCIALISM OR INDIVIDUALISM 69 But this 11% of the total product represents about 12% on the total capital invested, which was about $2,000,000,000 less than the annual production. It is perfectly evident from the above figures that the owners of the factories, far from receiving the amazing returns claimed by the socialists, are actually receiving a return which is only about one- half that paid to all their employees. This return represents only about 1 2 % on the capital invested in the factories. Moreover, on page 1 30 of the same volume the census statistician informs us that this return given above did not take into account the depreciation of the plant and buildings because it was too difficult to compute it fairly in all the different individual cases and that this return would have to be con- siderably reduced if allowance were made for this depreciation of plant. In other words, the owners of the factories out of their return of 1 2 % had to take care of de- preciation and the continual reproduction, repair and replacement of their machinery and plant. It is perfectly evident that this margin is no more than sufficient to accomplish this purpose satisfactorily for any length of time, taking into account periods of depression.* * Author's Note: See "Income in the United States," published by The National Bureau of Economic Research, for further facts on this same line of thought, and brought down to a more recent date up to and including 1919. 70 SHADOW OR SUBSTANCE It is also perfectly evident that viewed broadly, over a long period of time, that the lion's share of the benefit of power-driven machinery has gone to the laboring classes in increased wages, and that they could not have secured more of the benefit ifj they themselves had owned the factories from the beginning. Socialist State Must Have a Surplus. Even a complete socialist state could not get along without accumulating a surplus. The surplus namely, that part of production not consumed each year and saved to be reinvested, is very im- portant to a nation and it would be just as im- portant to a socialist government as it is under cap- italism. Without it you cannot advance one step; no new improvement to transportation, to a road, to a farm, to a river, to a harbor or to a factory can be made without a surplus. If the owners have not saved up a surplus themselves to make the im- provement, they must borrow somebody else's sur- plus. But the surplus must be available some- where before the improvement can be made. The nation that would consume all it produces year by year would be headed straight to ruin. It could not build a highway, a canal, a new railroad, or any other new improvement. The Bolsheviki delega- tion at Genoa proclaimed loudly that Russia was stuck and could not start up again without a loan. What does this mean in plain language? It means that her surplus was all gone, all exhausted, stolen SOCIALISM OR INDIVIDUALISM 71 or destroyed and that they wanted to borrow the surplus accumulated by outside people in order to stait up again. So that even a socialist state would have to save up a surplus in order to be able to maintain its in- dustry, its transportation, and its general condition up to the requirements of advancing civilization. To do this it could not possibly pay to its working classes all that they produced, and it would un- questionably have to deduct fully as much as is now deducted under capitalism. In that case the worker could not possibly get all that he produced and could not get more than he receives under capitalism. But undei the socialist regime this surplus would have to accumulate in the hands of the political chiefs at the head of the government. Does anybody with any experience believe that these politicians would prove more honest than the ones we are now familiar with? Surplus Under Capitalism. Under capitalism this surplus accumulates in the hands of the ones who own the factories. They take care of it because they think they own it, whereas it more often owns them, and they reinvest it in new enterprises which benefit the whole nation. From the point of view of national welfare, this saving and reinvesting the surplus by the so-called wealthy people is of the utmost importance and 72 SHADOW OR SUBSTANCE overshadows by far their role of spenders on them- selves, which is insignificant by comparison. Even the ostentatious and foolish spending of a few idle rich, tho condemned by all serious minded people, is not without some measure of social util- ity in the long run. It appeals to thousands of people who regard it as the acme of pleasure and fills them with the am- bition to get rich themselves and thus stimulates them to extra effort and to save in order to reach that supposed happy state. These efforts are ben- eficial to production as a whole and increase the na- tional income. Moreover it quickly separates the fools from their money and passes it into more use- ful hands. CHAPTER IV. EXAMPLES FROM CHINA, THE PHILIPPINES AND INDIA. The Condition of China. Let us compare this country with China, where capitalism has never developed beyond the most primitive stage. China has a fertile soil and great natural resources, but they have few tools, poor transportation and little machinery. In consequence production is feeble and wages are necessarily low. Because, 1st us not forget, the wages of labor are paid out of what labor itself produces and when, therefore, production is small, wages must also be small. Now, would it rob the laborers of China, if cap- ital should go in there and develop efficient power- driven machinery, production and transportation? Will they be exploited when they produce sixty times more than at present and receive forty-eight times as much wages? The Development of the Philippines. We have the answer in the Philippines. Ameri- cans with capital, brains and enterprise went in there, though our government did everything it could to discourage them. They took the primeval jungle, useless to man or beast, drained and cleared 74 SHADOW OR SUBSTANCE it and constructed perfect concrete highways through it, built splendid villages with neat cot- tages in which prosperity, cleanliness and thrift have taken the place of poverty, squalor and shift- lessness, substituted pure artesian waterworks for polluted wells and springs, built factories, club houses, concrete school houses and theaters and es- tablished scientific cultivation, taught the workers how to really work and multiplied their wages many times. Of course, they did it to make a profit for themselves. But is there any other way that we could have gotten them to work for those Filipinos? Are they not entitled to their reward? Did they not benefit the Filipinos even more than themselves? Is this exploitation? Marx says yes, but the experience of mankind says no! I prefer to call it enlightened self interest, which is better and more durable than benevolence; and a system which puts a superior man under the impulse of this enlightened self-interest to practically toil for the benefit of a multitude of his fellow creatures, and elevate and civilize them, cannot be lightly condemned. It may not be perfect, but it is far from being the worst system. Workers in India. A letter from Calcutta, India, has just come to my notice, in which the writer describes the wrap- ping of a small bundle weighing about ten pounds, for shipment to the United States. Nine men were sent to do this job. One man packed the box SOCIALISM OR INDIVIDUALISM 7" and sewed on the burlap; two men helped him, one on either side, to hold the corners; each one of these had an assistant standing by to relieve him if he got tired or had to go out. They were ap- prentices learning the trade. Another man was the painter, waiting to paint on the address, and be- hind him stood his assistant carrying his little tin of paints (three inches in diameter) and a palette three inches by six inches. Over all these stood the Babu or foreman giving his orders, and in addition there was a durwan or watchman to keep them from fighting and from stealing anything. It took those nine men six hours to finish the job that one American packer by himself would have accom- plished easily in an hour. Is it any wonder that the wages in India are only a few cents a day? They produce almost nothing and therefore receive almost nothing as wages. It is worth about 75 cents to pack that box. But this 75 cents has to be divided among nine men and each one receives only a few cents for his labor. If one man can do it by himself in an hour, he is a valuable man to his employer, and can command five times as much in wages as the nine combined. Now if we wished to elevate the condition of those workmen in India, the first thing we would have to do is to educate and train one of the nine so that he could do that job by himself, say, in five 76 SHADOW OR SUBSTANCE hours. Then the employer could afford to pay him wages of one dollar a day, which would be un- precedented for that country. But the labor leaders down there would object that this would throw the other eight out of employment. This is per- fectly true. It would deprive the other eight of the job of doing almost nothing and receiving almost nothing as pay, and if we stopped at those partic- ular eight it would be a hardship on them. But if we extended the process all over India, it would be a different story. The thousands of trained workers earning one dollar a day would soon have many wants. They would no longer be satisfied to go almost naked with only a rag around their loins. They would want to protect their feet with sandals and their bodies from the scorching rays of the sun. Instead ot having less than five dollars* worth of house- hold goods to each family as now, they would want a little comfortable bedding and a few articles of convenient furniture. Instead of living in miser- able hovels scarcely fit for beasts, they would de- sire a more comfortable habitation. Instead of al- most starving on a few grains of rice, they would want better food. The other eight thrown out of employment, if also trained efficiently, could pro- duce something worth while and receive suitable wages in keeping with their increased production, because wages are paid only out of production and nothing else. Then their purchasing power and SOCIALISM OR INDIVIDUALISM 77 wants would keep pace with their increased wages and there would be an active demand for all kinds of commodities and millions of workers would be kept busy at good wages in producing them. This increased production all over the nation would ne- cessitate better buildings, better factories, better transportation, better facilities for distribution and all the other facilities of what we call civilization. All this would require a surplus, but this surplus would be there because it would be steadily ac- cumulated from the profits of all those great works. To D^oduce all these things millions of workers would have to be emoloyed and there would be an active demand for laborers of all kinds. There would be an actual scarritv of labor instead of mil- lions of unemploved. This scarcitv of labor would automatically advance wages, which would neces- sarily keep pace with increasing production. This tremendous increase of production in the whole na- tion would radiate prosperity on every hand, but first and foremost it would be reflected in the in- creased well-being, physical, moral and spiritual of their working classes, who would unquestionably get the lion's share of it. In fact, the improve- ment could not take place at all if they did not get the greatest part of it. It has to start with them and is based on them. What, then, may I ask, keeps the workmen of India from enjoying this prosperity? What keeps them in a poverty so terrible that our imaginations can scarcely picture it? 78 SHADOW OR SUBSTANCE The answer is ignorance, pure and simple. It is impossible in a short space to show all the ramifi- cations of it. To go back to my illustration (which, it must be understood, I use only in a broad, gen- eral sense) . Those workmen imagine that they are cheating their employer by compelling him to em- ploy nine men to do the work that one could easily do. In their stupidity they cannot see that they are also compelling him to pay to all the nine the same wage that one man should get. By the rules of their guild, which compel nine men to produce onlv what one man could do, they limit each one of the nine men to receive only one-ninth of the wages which one man ought to receive. They limit their workers to one-ninth of a real man's production, but they also reduce them to one-ninth of a real man's wages. In a word, they are simply cheating themselves and standing in their own light. I have no doubt that they would kill the enter- prising worker who tried to do a real man's work, on the ground that he was a detriment to the union, and there is no doubt that they would break up any labor-saving machinery that anybody tried to in- troduce in the belief that it would take work away from them. We can well laugh at the stupidity of these Hindus, but let us not congratulate ourselves too much, because the workmen of more civilized lands are not altogether free from the same kind of stupidity. More than once our workmen have de- SOCIALISM OR INDIVIDUALISM 79 stroyed or refused to use labor-saving machinery for the same reason, and our labor unions every- where, especially in the building trades, have tried to limit the output of work so as to compel their employers to employ two men to do the work that one could easily do. They seem ignorant of the economic law (as inexorable as the law of gravity) that if two men do only the work of one, it will onlv be a question of time when the two together will only receive one man's pay. Either the cost of living and the rents will ero un, so that the value of their dollar will onlv be fifty cents, or thev will stand idle most of the time. It is imoossible for an emplover to pav his workmen more .than triev produce without going broke himself and ceasing to be an employer. The workers who imagine that they can increase their wa^es bv limiting nroduction, sabotaere and other destructive methods, are as ignorant as the Hindus I have mentioned and are simply cheating themselves. The opposite course of increasing production is the true way. The man who discovers a way by which one man can do the work which now requires two will surely increase wages. This is the way that wages were increased in the past. It .was the in- vention of labor-saving machinery which did it. On the other hand, if we should suddenly destroy all the labor-saving machinery in this country, pro- duction would immediately dwindle to a small frac- 80 SHADOW OR SUBSTANCE tion of its present volume and wages would, of course, have to shrink in proportion. As our people would not quickly adjust them- selves to the chronic misery of the Hindus, millions of them would perish. Labor-saving machinery, therefore, is what stands between us and indescrib- able disaster. But labor-saving machinery is the result of sur- plus. It is surplus that builds it up and reproduces it when worn out. Surplus stands in relation to labor-saving machinery as the parent does to the child. No surplus, no labor-saving machinery. But surplus is capitalism. It is only another name for it. But the socialists say we are not going to destroy labor-saving machinery, we are only going to ap- propriate it. Perfectly true, but they have de- nounced the surplus and have proposed to abolish it. This would also soon indirectly cripple labor- saving machinery. As Shylock said in Shake- speare's play: "You take my life, if you do take from me the means by which I live." But recently the socialists say we must maintain the surplus in order to maintain the efficiency of pro- duction. In that case the worker would get nothing more than he does now and the only change that they would make would be in those who would hold and handle the surplus. Under the present SOCIALISM OR INDIVIDUALISM 81 system it falls in the hands of those who develop exceptional genius, management, ability or industry by a process of natural selection. Under socialism they would be the walking delegates elected by the workers. I fail to see how that would improve conditions in the least. If there is anything that ex- perience has clearly demonstrated in this country, it is that the iudgment of the masses in electing of- ficials by ballot is exceedingly poor. Our elected representatives have usually been those whom any prudent man would not entrust with his own busi- ness. How then can we expect the surplus to be any safer or better managed in their hands ? One word more in regard to exploitation. Some radicals have asserted that American cap- ital must not be allowed to exploit weaker people like the Mexicans, Chinese, Filipinos, Hindus, etc. How is it possible to exploit the Hindus in their present condition? They have nothing that any- body can take away from them and have them con- tinue to live. If American capital went there to make a profit (which is what they mean by ex- ploitation), it would first have to get them to pro- duce something. It would have to improve their methods of production, transportation and distri- bution so that they would have a surplus worth while. Would not this benefit the Hindus more than anybody else? This leads me to ask the ques- tion, "What is the chief thing that stands in the way of progress the world over?" The answer ia. 82 SHADOW OR SUBSTANCE "Lack of intelligence/' or, in one word, ignorance. The evil passions of envy, jealousy, malice, hatred, prejudice, perversity and greed are contributing factors, but in a broad sense ignorance is more or less the mother of all that evil brood. CHAPTER V. POLITICAL DEFECT OF SOCIALISM. But the most fatal defect of socialism, I have yet to mention. All the difficulties I have pointed out above are economic, there remains the political de- fect, which is the greatest of all. AH those who have read the preceding pages will perceive that the first political effect of socialism is to increase enormouslv the power of the state. It multiplies bv manv times the number of people directly em- ploved by the state and therefore dependent on the state for their salaries, their emoluments and authority over those under them. In every branch of industry, transportation or agriculture in every hamlet in the land, there will be swarming thou- sands of commissars directly under the control of the head officials of the state. In Moscow alone there are over half a million petty officials of the Soviet Government on the payroll. And the Soviet has more employees than any other government on earth has ever had. Every one of these petty officials will be interested in holding his job, because to lose it means to get re- duced into the same condition as the people under him. Self preservation alone will make him cling to power as a drowning man grasps at a straw. They can therefore be relied on to support the chiefs higher up with fidelity and zeal and they will 84 SHADOW OR SUBSTANCE form a political machine, the like of which has never before been seen on this earth. Political Change Impossible Under Socialism. As the individual voters under them are abso- lutelv at their mercy and can be injured or bere~ fiteoT bv their favor, there is no doubt that the partv in power will remain there as lon< as th^v like. The fact is that I fail to see whv thev should even waste the time to hold an election. Thev ronld "?t as well register the result beforehand as tbev used to do in Mexico, under Diaz. Moreover, with the abolition of private propertv, everv news- paper, everv rmntinor press and everv other means of communiratin*? ideas to the people, becomes the propertv of the state and it becomes impossible for anvbodv opposed to the government to e'et anv- thinpr printed or circulated. Ill-advised activity against the head-men would be no doubt followed by the arrest and disappearance of the agitator and nobodv would be the wiser except a few near friends or relatives, because! no news of it would ever leak out. The only newspapers, books or pamphlets published will be under the control of the head officials of the government and they will give the people whatever they see fit to mould their opinions. The opposition can never be heard un- der that scheme. Preachers, teachers, doctors, law- yers, etc., will all be officials of the government and hold their jobs under the pleasure of their chiefs. Has any machine as powerful as that ever been seen SOCIALISM OR INDIVIDUALISM 85 on this planet? This is the reason that it has been impossible to oust Lenin, Trotsky, and their clique in Russia; in spite of all their crimes. They are many times more powerful than the Czar ever was. Marx and Engels foresaw this difficulty and tried to meet it by maintaining that the state, as we know it, will have ceased to exist and that the so- cialist state will be more democratic and more un- der the control of the people. I fail to see how. Admitting that the socialist state might start out as a democracy with the best intentions, would it re- main faithful to its original ideals? Has anybody ever had power on this earth without abusing it sooner or later? The first founders of the move- ment might be honest, well meaning altruists, but they would in due course of time be succeeded by a Napoleon, a Cromwell or a Ceasar and they in turn by a Nero, a Caligula, or a Heliogabolus, and nobody could ever dislodge them except by assas- sination. The Split Between Marx and Proudhon. This was the point which caused the split be- tween Proudhon and his disciple Bakunin on the one hand and Marx and Engels on the other. Proud- hon told Marx plainly that his system would estab- lish a despotism that would make every other one that has ever preceded it on this earth pale into insignificance when compared to it. Time has dem- onstrated that Proudhon was right and that Marx 86 SHADOW OR SUBSTANCE was wrong and the Bolsheviki in Russia have de- veloped as atrocious a tyranny as ever disgraced this planet. Considering all the facts which have come to our knowledge from perfectly disinterested observers and from sources even favorably inclined to the Bolsheviki, it is perfectly evident that the Bolsheviki have been much worse than even the unintelligent despotism of the Czar's regime, and it is doubtful if there has ever been in the past a government at the same time so tyrannical and so inefficient as the present Russian Soviet. Judging it by the ordinary standards of civilized nations, we find instead of security of life, of per- son, freedom of individual effort and the enjoy- ment of the fruits thereof that wholesale robbery, rape, and murder are the daily vicissitudes of life in this boasted Utopia. Both Bertrand Russell and H. G. Wells, the English radicals and former Socialists and the American relief workers all reported that conditions in Russia were awful. There is chronic continuous hunger among all the people. Tram- ways have practically ceased to operate in the cities. The railroads are crumbling into ruin from lack of necessary repairs. The streets are decayed, torn up and impassible. The sewerage systems have collapsed, the water pipes have been bursted by the cold of winter and filth and unsanitary condi- tions are prevalent everywhere and the great masses of the people are suffering hideous and frightful misery. SOCIALISM OR INDIVIDUALISM 87 There is no such thing as the slightest personal liberty in Russia today. The peasant is forced to yield much of his crops to the state without receiv- ing any equivalent therefor except worthless paper roubles. Moreover, he is drafted to compulsory labor and forced to do the most menial work of the crudest kind. The workman in the cities is bound to his factory or mine, his remuneration is fixed by his overseer, the commissar of the state. He can- not move without a permit from the labor bureau controlled by the state. He is forbidden by the Bolsheviki from even going on a strike which is considered an act of rebellion against their au- thority, and every one of their labor unions have been suppressed and abolished by these tyrants. Corruption is rife among officials who are bribed constantly to do anything. Even food, the life- giver, is not handled on a just and fair basis, but used as a weapon in social and political struggles. Then on top of all this they have the infamous and dreaded Tcheka, or extra- ordinary commission of justice with unlimited and arbitrary power. It searches houses at its pleasure, it raids market places, it arrests citizens on mere suspicion and maintains a list of so-called suspicious persons and puts them into jail on the slightest provocation. It keeps men and women for months in solitary con- finement without even preferring any charge against them. It tries, condemns and executes them, with- out so much as the victim knowing what it is for or 88 SHADOW OR SUBSTANCE having the slightest opportunity to defend himself. This Tchecka is far more terrible and irresponsible than the revolutionary tribunals were in the French Revolution and its like has never been seen any- where else on this earth. There is no political freedom in Russia today. Not only the bourgeois parties are under the ban, but even all the outspoken radical parties, the men- sheviki, the social revolutionists, the social-demo- crats, etc., are all deprived of any means to make a political campaign, they are forbidden to issue any newspapers, magazines, pamphlets and leaflets or to call any open meeting of any sort. The claim by the friends of Soviet Russia that Bolshevism is the government chosen by the Russian people is ridicuously false. Numerically the com- munists only muster a few hundred thousand mem- bers which is less than one-half of one per cent of the population of Russia. The Bolsheviki broke up and dispersed by violence, the Douma which had been elected as a constituent assembly in a free and unhampered election and which was fairly repre- sentative of the Russian people and for that very reason was overwhelmingly against the bolsheviki. It is a fact admitted by the Bolsheviki themselves that if a free and impartial election were held in Russia at the present time they would be in a hope- less minority and that is the very reason that they do not and will not have such an election. SOCIALISM OR INDIVIDUALISM 89 Lenin and the Bolshevist leaders have always frankly declared that they do not believe in the democratic rule of the majority of the people. They have openly expressed their contempt for the peo- ple, whom they call ignorant, unenterprising and "lethargic." They have relentlessly put into prac- tice Lenin's "Theory of Minority Revolution and Minority Rule." Wherever, by some chance, an important Soviet has been elected with a majority against them, or has had the temerity to vote against them, they have promptly suppressed it with an iron hand. Yaroslav, a large industrial city north of Moscow, and Krasnoyarsk, another important place, elected Soviets with Mensheviki and Social Revolutionary majorities against the Bolsheviki. Lenin promptly pronounced them Counter-Revolutionists and unfit for self-government and abolished their Soviets al- together. Every attempt in those places to organ- ize self-government after that was sternly suppressed in blood. The dictatorship of the proletariat therefore does not mean self government by the majority of the people or government deriving its just powers from the consent of the governed; it means the tyranny of a comparatively small minority over the balance of the nation. It does not establish a free repres- entative, republican, or democratic form of govern* ment as the western nations understand it; it establishes the oligarchy of a small ruling class, not 90 SHADOW OR SUBSTANCE much more numerous than the ruling class of the Czar's regime, but far more energetic and more closely organized and exercising a more relentless tyranny. A small minority which forces its will upon the majority of a nation must always be tyrannical be- cause that is the only way it can accomplish its purpose. The Ray of Hope in That Terrible Condition. But we must not imagine that there is no silver lining even to that apparently terrible situa- tion. The great philosopher Goethe said that the best proof we have of a supervising intelligence in the universe is that He is able to turn eventually into good what man has intended as evil. No doubt from the present Bolshevism a better condition may eventually emerge in Russia, even as from the ter- rible frenzy of the French Revolution a new French nation developed with higher principles of justice and equality; because one of the results of the French uphpeaval was the dividing up of the land of the nobility and clergy amongst the peasants who were the real cultivators of the soil and the creation of a nation of peasant proprietors. The same land distrbution has taken place in Russia and in time these new peasant owners, who are the immense majority of the people of Russia, may perhaps learn how to establish a new government devoted to law and the ordinary processes of civilization which will be more progressive and liberal than the old re- SOCIALISM OR INDIVIDUALISM 91 gime of the Czar. It will take, however, a long time to accomplish this, because the Russian peasants are on a much lower plane of civilization than the French peasants of the French Revolution, and it is probable that they will go through a long period of reversion to a purely peasant nation. The greatest contribution of the Bolsheviki to mankind therefore, will have been the clear demon- stration of the utter impracticability of communism. CHAPTER VL GENERAL CONSIDERATIONS AND SUMMARY So far I have confined myself mainly to discuss- ing the immediate effect of socialism on the working classes, but there is a broader and more general side to this question, in the ultimate effect of social- ism on individuality. The Importance of Individuality. The human race has progressed in the past main- ly by the development of exceptional individuals whose genius has increased our power over the forces of nature. The free scope of individuality is of the greatest importance to the future progress of the race. Any system therefore which subordinates the in- dividual to the state and makes us all conform to a standard regulation, and fit nicely in our respect- ive little grooves, is bound to restrict the free de- velopment of individuality and is certain in the long run to diminish the chances of exceptional genius being produced. - This will ultimately dry up the springs of progress. The higher standard of living, higher wages and the general distribution of com- forts among civilized people are in a broad gen- eral sense entirely due to the progress of industry which in turn has been based mainly on inventions and discovery by men of genius. Any future bet- SOCIALISM OR INDIVIDUALISM 93 terment in the condition of the people and increase in their wages can only come about in the same way. Strikes and fighting about the relative share that shall go to this or that group may temporarily change the distribution of the industrial income, but it will only be temporarv and will be more or less nullified by the increased cost of living. The Real Road to Prosperity. Anv real permanent ^ain will onlv come bv im- provements in industrial methods, bv inventions and bv the discovery of new forces and resources wnich will increase production as a whole and therefore the total national income. ^ therefore which puts an obstacle in the path of industrial progress is not going to ultimately benefit the masses of the people. Yet, strange to sav, the working classes have always fought against their best interests by refusing to use labor-saving inventions and sometimes de- stroying them and interfering with prosperity in every way possible, by strikes, boycotts, sabotage, and inefficiency and curtailment of work and other practices. Wages even now would be considerably higher if it were not for the industrial incapacity of most of the workers. 94 SHADOW OR SUBSTANCE It is difficult to imagine what our national wealth would be if every worker were efficiently trained in a suitable vocation and honestly did the best that was in him. I firmly believe that our present wages would seem small by comparison with what they would then be. Private Property Necessary to Civilization. For these reasons which I have pointed out there is now an almost unanimous agreement among all those who have studied the question at all that any attempt to entirely abolish private property must prove a flat failure because it conflicts with the fundamental traits of human nature. We now perceive more clearly than ever before that the love of self is yet, as it always has been, the moving principle of the immense majority of individuals and the motive that alone impels them to voluntary and sustained exertion; and this must be recognized as the necessary foundation of every community, big or little. The desire to own and possess material things, in short, the desire for private property, is inherent in most individuals, and is the mainspring of civ- ilization; and opportunity for its gratification must be retained in any social system. It is the keystone of the arch and when it is removed the whole edi- fice crumbles into ruin. It is indeed strange that anyone should ever have doubted this for a mo- ment. SOCIALISM OR INDIVIDUALISM 95 Communism a Failure Everywhere. It is not alone in Russia that communism has broken down by itself of its own inherent defects and has had to be abandoned even by its most fa- natical adherents; the same has taken place every- where else on this earth where it has been tried on a large or small scale. Even under the most favorable conditions, as in the great communistic colony of Paraguay, South America, where the natural resources were so abun- dant and accessible that all human wants could be easiW satisfied, communism failed and had to be abandoned. Moreover, these verv same Colonists, who were in abiect misery and privation as long as thev practiced communism, became prosperous and well to do when they abandoned it and adopted in- dividualism. The same took place in the communistic state established by Gen. Zapata and his follow- ers in two of the states of Mexico and the same took place even in the small communistic societies which were established in many places in this coun- tr>1 about the middle of the last century. These communities were very favorably situated and their membership was voluntary and in many cases was selected with some care to secure people who had the proper co-operative spirit; and yet they all finally proved failures. The same result has been noted practically everywhere except in the monas- tic orders, where the religious enthusiasm of the 96 SHADOW OR SUBSTANCE members and the severe discipline imposed on them by a hierarchy has been able to overcome the in- herent defects of communism. Socialism Repudiated in Europe Generally. The fact is that socialism is being repudiated everywhere all over Europe where socialists have been in power. For over three years socialists have been in nowe^ in German v, and they have been compelled by the sheer force of circumstances not onlv to re ; ect anv further socialization but also to undo m^ch of the state socialism established by th** former Kaiser's government. The difficulty with an industry operated bv the stpte, is that it does not have to be a success. When it foils to meet its expenses, the state can simply fall bark on the taxpavers to contribute more taxes to its maintenance. In this respect it is like the son of a rich father when he goes into business, he feels that he can fall back on the old man to help him out when the business does not pay, and consequently he does not exert himself to make it pay and it rarely does. A private business is on a real competitive basis, it must pay or go broke, and when it goes broke, it has nobody to fall back upon and it simply disap- pears and makes way for someone else who can make it succeed. The universal poverty of the Germans brought about by the war compelled the strictest economy in SOCIALISM OR INDIVIDUALISM 97 every line of production and distribution and all the industrial social and commercial forces were mobil- ized with that end in view. A commission headed by Karl Kautsky, the undisputed leader among the living theoretical socialists, and in which sat the well-known socialists, Rudolph Hilferding, Prof. Emil Lederer, well-known socialist writer; Paul Um- breit, the chief of all the socialistic labor unions; the formerly rabid socialist, Wilbrandt, professor of po- litical economy at Tubingen University; Otto Hue, the coal miners* leader, and Otto Cohen, the social- ist secretary of the labor unions, examined the whole subject impartially from every angle and unani- mously came to the conclusion that nationalization was only the replacement of one employer, the cap- italist, by another employer, the state, and that in actual practice the state as an employer is inefficient, dilatory and wasteful. Moreover, the commission decided that if in the future any coal owner showed more than ordinary efficiency, he should be allowed bonuses on top of his profits and that these bonuses should not be less than the extra profits which he would have reaped under free capitalism. What becomes then of Marx's famous theory of surplus value, the confiscation of which formed the central doctrine of socialism? Moreover, Marx is now bitterly assailed and re- pudiated on all sides. Prof. Wildbrandt of Tu- 98 SHADOW OR SUBSTANCE bingen University, who only three years ago was rabidly in favor of the state owning everything, now says: "Marx must be repudiated." And Rudolph Wissell and Robert Schmidt, both socialist minis- ters of industry, declared that **the Erfurt program is an absurdity and that the socialist program must be revised in accordance with real economic facts," which means that Marx must be repudiated. So within only three years, a complete revision of German socialism has come. The explanation is that the most zealous, most ingenious of German socialist statesmen could not find any effective sub- stitute for the incentive to energy and efficiency which under the capitalistic system is supplied by the motive of individual gain. So that a government by socialists, of socialists and for socialists has denationalized and handed over to private management most of the complex state socialistic schemes of the Hohenzollern regime, the railroads, railroad construction and repair shops and other vestige of state socialism, and brought about the unwilling conversion of the socialists themselves. It is perfectly evident, therefore, that whatever evils we may complain of in our existing institu- tions, we cannot hope to make conditions any bet- ter by forcibly destroying the institution of private property. SOCIALISM OR INDIVIDUALISM 99 The Steady Growth of Co-operation. But, on the other hand, we must not overlook the fact that the human race, from the earliest pe- riods of its existence on this planet, has been mov- ing slowly but continuously and steadily towards an ever greater association of individuals together for common purposes. To find the genuine simon-pure individualist we must go back to the primitive savage wandering alone in the primeval forest. From thalj time to the present day the movement away from extreme individualism towards an ever greater development of the social man has been unceasing. There has also existed a tendency to hold an ever increasing amount of property by the state for the benefit and use of its people. For instance, at one time the highways even were private property. Now they belong to all the people and are free for their use, and we also have the public parks and buildings, the recreation, tennis, golf, foot and base- ball grounds, swimming pools, baths, schools, li- braries, hospitals and many other forms of pub- lic property owned by all the people and held for their common use. Qur endowed colleges and universities and our great charitable foundations are a species of semi- public property usable by any citizen under pre- scribed conditions. 100 SHADOW OR SUBSTANCE Many of our fraternal orders in this country and others, such as the Circulo des Dependientes in Cuba are examples of co-operative ownership and effort, and they hold considerable property in trust for their members. Finally, the great co-operative societies, notably the Rochdale in England and others in Europe, are magnificent examples of hun- dreds of millions of property held co-operatively and of hundreds of millions of business done yearly in that way. In fact, the Rochdale association is said to be one of the largest financial institutions in the world. Co-operation Destroyed by Graft. But co-operation to be successful must be volun- tary. Plato, the original Utopian, pointed this out. His ideal was a willing co-operation of citizens in- telligent enough to realize its advantages to them- selves as well as to others. When people are too stupid or perverse to co-operate it is impossible to make them do it by force. Force does not make them real co-operators, it simply converts them into slaves, none the less so because they would then be the slaves of a system rather than of one master. This is the underlying fallacy in the program of socialism. They preach fluently about the beauties and advantages of the co-operative commonwealth and how much better we would all be if we would co-operate fully in all our social activities and at the SOCIALISM OR INDIVIDUALISM 101 same time they advocate accomplishing this' by force. Force and willing co-operation are utterly incom- patible. When one comes in, the other goes out. Every intelligent man fully realizes the advantages of co-operation and admits all that the socialists say about it but they also know very well that it is im- possible to make men co-operate willingly by force. Moreover the success of these co-operations de- pends entirely on their being able to secure intelli- gent, efficient, and above all, honest managers, and this can only be done in a community where there is respect for and willing obedience to the laws, and this in turn, ia the result of just laws impartially and promptly enforced. Such a condition prevails in England and in some other European countries. These societies on the other hand have not succeeded in this country, be- cause the laws have not been enforced and our ju- dicial system has become undermined with polit- ical influence and honeycombed with graft, and there has in consequence grown up a general dis- respect for the law and a relaxation of the moral fibre of the people. As Henry George said: **In a corrupt democracy the tendency is always to give power to the worst. Honesty is handicapped and unscrupulousness commands success, and where men are habitually seen to raise themselves by cor- rupt qualities from the lowest 'ranks to positions of 102 SHADOW OR SUBSTANCE wealth and power, tolerance ot these qualities final- ly becomes admiration and finally corrupts all the people/' This is our condition today. Here per- sons do not hesitate to plunder institutions under their charge because they are sure that they have a good chance to escape all punishment. Violence is Anti-Social. For the social organism to function femoothly we must have a considerable development of the so- cial qualities in its citizens and we must reduce to a minimum the anti-social crimes which are in reality a revolt against the authority of all the peo- ple and their civilization. Dishonesty is the friction in the social mechan- ism and we cannot hope to achieve a more perfect social condition until most of our citizens are willing to accept and obey the laws which the composite state has made for the guidance of all its members. It is the height of absurdity therefore for any- body to expect to usher in a higher social condi- tion by wholesale violence, plunder and murder. These crimes will lower instead of elevating the social consciousness of those who commit them. When the Bolsheviki turned loose in Russia an orgy of loot, lust, murder and all sorts of Crimea of violence they were not traveling towards a higher social order, they were in reality swiftly sinking into barbarism. Not the least of their crimes was SOCIALISM OR INDIVIDUALISM 103 the suppression of highly successful co-operative so- cieties and the confiscation of their property, which proved conclusively that they were enemies of real progress. To develop a higher social order we must have developed among our citizens the qualities of kind- ness, gentleness, good will, honesty, sincerity, rev- erence, fraternity and equality. These qualities are the result of ages of education, religion and peaceful development. They are a slow evolution and in the very nature of things they cannot be achieved by the anti-social crimes of violence. Co-operation Will Increase. With these reservations, however, it is reason- able to suppose that the age-long tendency of the human race towards an ever increasing co-opera- tion will continue for many ages in the future and that some time a way will be found for men to en- joy all the benefits of association with their fellows without losing their individual freedom of action or their individuality. Also that a way will be found for a very con- siderable extension of associated ownership of prop- erty which will probably include all natural re- sources and monopolies without at the same time interfering with man's individual freedom to exert himself for his own benefit and to acquire the things he desires for himself alone. 104 SHADOW OR SUBSTANCE Inconsistent Rights* Finally, we must call attention to the fact that the two fundamental rights claimed by socialists are: 1st. The right of the laborer to the full product of his labor. 2nd. The right of every individual to subsist- ence. These two rights are inconsistent with and fun- damentally opposed to each other and could not by any possibility be realized at one and the same time. --v^. If either one of these rights were conceded, it would necessarily and immediately involve the de- nial of the other ,as anyone can readily figure out for himself. The right of the individual to sub- sistence even when not earned temporarily or per- manently by himself, necessarily involves the tak- ing away from others of a part of their production and therefore is a denial of their right to the full product of their labor. Marx's entire contention was based on the right of the laborer to the full product of his labor. We have shown above that there is no practical way by which this can be accomplished even under a communist state. Altho seemingly just in the ab- stract, concrete conditions make it practically im- possible of complete realization. Every individual SOCIALISM OR INDIVIDUALISM 105 has to concede a small part of his rights to the com- munity in which he lives, in return for the benefits and protection he derives from his association with them. He also has to surrender a part of his per- sonal liberty, in order to accommodate himself to living in contact with his fellow men in a settled community. If he wishes to enjoy absolute per- sonal liberty to do whatever he likes, and to have everything he makes for himself alone, he must go away by himself into the wilderness far away from everybody else. The moment he wishes to live in contact with his fellow men he must accommodate himself to the equal rights and equal liberty of other human beings and this cannot be done without sur- rendering a part of his rights and liberty. It is very strange, however, that Marx and his followers who are so insistent on the one hand in claiming the individual's right to every particle of the product of his labor, should, on the other hand, be the very ones who are advocating the total sub- ordination of all the individual's rights and liberties to the state. In asserting their fundamental claim of the in- dividual's right to the full product of his labor they are extreme upholders of the individual's rights and therefore extreme individualists, but when it comes to carry out their theory they are extreme collectiv- ists and are perfectly willing to sacrifice all the rights of the individual to the welfare of the state. Incon- sistency could scarcely go to a greater length. 106 SHADOW OR SUBSTANCE Practically whatever advance has been made by the human race towards the recognition of either of these rights, it has been rather towards conced- ing the individual's right to subsistence and to his claim on his fellowmen for aid in sickness and dis- tress than towards the other one, and this is due to the growth of the ideas of mercy, charity, kind- ness and benevolence among the masses of civi- lized people, which are the virtues we have justly regarded as the ones advocated principally by the Christian religion. Nearly 2500 Years Ago Aesop taught the world some homely truths by means of his simple fables which rnnny people would do well to study again at the present time. In one of these he pictured the strike of the hands of the human body against the stomach. He said that the hands became discontented with their lot and said to one another, We suffer all the hard knocks of the struggle every day and do all the work, in order to feed the lazy stomach which does nothing but enjoy itself with the food we provide. Let us stop feeding it and enjoy our ease like it does.** So they went on a strike and refused to convey any food to the stomach. But in a day or two, the hands became weak unto death and were glad to resume feeding the stomach which they discovered to be not so useless after all. A nation is an organism to all intents and purposes similar to the human body. While its component parts are SOCIALISM OR INDIVIDUALISM 107 not so intimately associated together as the parts of the human organism, nevertheless they are suffi- ciently interrelated and dependent on each other, tKat one part of it cannot destroy the other without committing suicide itself. UNIVERSITY OF CALIFORNIA LIBRARY BERKELEY Return to desk from which borrowed. This book is DUE on the last date stamped below. ICLF (N) APR12 1954 LU D LD DEC 18 1962 14May'60C&l r - MAYl 196C LD 21-95m-ll,'50(2877sl6)476 YB 07819 UNIVERSITY OF CALIFORNIA LIBRARY