Letters to the Editor
THE INDUSTRIAL METHODS OF THE UNITED STATES [To the Editor of the SPECTATOR.] SIR,—TO an American reader, one of the interesting things about the Spectator is the frequent discussion of industrial methods in the United States compared to those of Great Britain. Usually these articles have to do with our high wages, business efficiency, financial prosperity and the like. While one's patriotic sensibilities arc somewhat flattered by the laudatory tone of most of these items and one enjoys being told that his nation is an industrial paragon, may I be per- mitted to raise the question as to whether an exaggerated view of the prosperity of your wealthy young cousin does or does not tend to promote Anglo-American understanding ?
My opinion is that it does not, and therefore, without in the least contradicting any of the articles which have appeared in this periodical, I should like to point out some supple- mentary facts which should be considered. These facts are : (1) We do have a serious problem of unemployment; (2) Real wages in the United States are not high ; and (3) Our in- dustrial methods are far from efficient.
At the time of writing we are supposed to be floating on a wave of prosperity. Be that as it may, there are probably between one and one and a half million persons unemployed. At least, the unemployment figures from 1902 to 1917 show that such a number is to be expected at the peak of the business cycle, and twice or three times that number in periods of depression. For comparison with your country, we find that two years ago the unemployed per 1,000 of population were 19.9 in the United States and twenty-five in Great Britain. (Industrial Survey, March 9th, 1925, published by the National Industrial Conference Board, an organization of employers' associations.) While the manifestations of this situation may not be so acute as in England, surely no one can say that we have solved the problem of unemployment ?
Many Englishmen have recently visited the United States to discover, among other things, the secret of high wages." While there are conspicuous examples of establishments which do appear to have discovered some such secret, a broad view of the wage-earners throughout the country gives quite a different tone to the picture. Without going into statistics, perhaps I can depict the situation best by pointing out that about 50 per cent. of the wage earners in the United States receive less income than is required for a standard of living described as a " minimum health and decency " level. (This statement is based on data found in Income in the United States, by the National Bureau of Economic Research, and the Cost-of-Living surveys conducted by the National Indus- trial Conference Board.) However this condition may compare with that of other countries, it certainly shows that the average American worker is far from rolling in wealth and that actual poverty is far too prevalent.
As to the much advertised " American efficiency," the only serious investigation into this subject of which I am aware came to quite a different conclusion. Waste in Industry is the title of the report of a committee of the Federated American Engineering Societies, often called " the Hoover Report." The general conclusion reached was that the average American firm is less than half as efficient as the best firm in that parti- cular trade. In other words, all the firms of an industry, good, bad and mediocre, waste on an average more than twice as much as the most efficient firm in that industry. Of all the forms of waste which the investigators found, over 50 per cent. was directly attributable to management, less than 25 per cent. to labour, and the rest of the waste to outside causes. Certainly, a nation where such a small proportion of industry is carried on according to the best known practices does not deserve to be called efficient." • While it cannot be denied that in some respects America happens to be better off than many other nations, yet, with the foregoing and other similar facts in mind, should you not regard this country rather as a fellow-struggler than as a successful exemplar of economic perfection ?--I am, Sir, &c., JOSEPH Coat-RN SMITH: Colby College, Waterville, Maine, U.S.A.
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