LETTERS TO THE EDITOR.
ON THE WRONG TRACK.
[To TEIE EDITOR. OF Tile "SP genTOR.1 SIR,—By a gradual process of exclusion, Mr. Chamberlain in his second Birmingham speech has arrived at certain entirely sound principles, and all good men—even Free-traders, Little Englanders, and the members of the present Government—
will, I am sure, wish him "God-speed" if he will make these his irreducible minimum. They are, briefly, that imports and exports, even increasing ones, are not the sufficient tests of national prosperity ; that the growth of material wealth is not the goal of the national endeavour; that" the greatest happiness of the greatest number" is a "great, laudable aspiration"; and that a "greater reform "—one which would do more for the industrial population than all the efforts of the parties to which Mr. Chamberlain has belonged—is constant employment at fair wages. So far as I know, these are principles for which economists have been contending for the last half-century at least. But the words which 'chiefly caught my eye in that remarkable speech are these :—
"When the tide of prosperity recedes, as it always has done and must again, and when a time of depression follows, we shall find that it will be impossible, without a change, to find employ- ment for the constantly increasing population of these islands."
I desire as a Free-trader to express and emphasise my entire agreement with these words, and, what is more, to say, with
all the gravity of a responsible teacher of economics,. that Free-trade by itself will never secure constant employment for all the people of a country. It is time that statesmen should see that, not England alone, but all civilised nations are faced with new circumstances and a new problem.
What is the source and reason of our great and growing material wealth,—these hundreds of millions of income flowing into the consumption of the nation every year, not in money, but in things and services for the support and joy of life ? It is that year by year the production of wealth becomes more organic,—more finely differentiated and divided, more economically integrated. What does this organising involve ? That "machinery," in all its multitudinous forms, is set to do the work that it alone can do ; that man is set to do the work which he alone can do; and that where the two can do and have been doing the same kind of work, machinery is substituted whenever the point is reached that it can do the same kind and amount and quality of work more economically. This is the course which industry has followed when led and guided, as it has been, by the brains of men specialising as "employers," who make their living by the constant rearrange- ment and substitution of the most economic factors; that is, the factors which turn out the largest output at the least cost,— for, to employers, factors are factors and nothing more. They will substitute machinery for man or man for machinery just as either subserves this result. This does not involve that fewer men, on the whole, are employed,—quite the reverse ; but it does involve that, unlese men are trained and made capable either of doing the exclusively human services which other men demand, or of working in collaboration with machinery, there is really no place for them in the industrial organism— the working world—of to-day. It is not in the very least, as Malthus proclaimed, that "at Nature's mighty feast" there is no seat for them, because "population tends to press on subsistence "; it is rather that they have not conformed to the terms of the invitation, and shown their certificate of being providers of the feast. as well as guests at the board. In short, the more perfect the organism—the more capable of turning out wealth—the less room is there for the person who is not able, by capacity, education, or technical skill, to find a necessary place in it. And Mr. Chamberlain is quite right in his suggestion that the time to judge of national prosperity is not when the tide is running strong. For when prices are good and profits good the rigidity of the organism is relaxed,—as, when the herring come on the coast, boats lying rotting on the beach are hurriedly rigged up and take the water. But, when the herring leave, the fishing trade falls back to the boats which can be "worked economically."
It is very hard. Children do not ask to come into the world. When they do come, at the imperious call of an in- eradicable instinct, they find themselves too often under the tutelage, for long, helpless years, of parents who think nothing of their future, or even wilfully make use of them in selfish ways, sending them prematurely into work that adds to the family income at the cost of stunting the young limbs and cramping the young intellect, and that among surroundings of slum life more fit for hogs than for children. And then they find that there is "no room." Nobody wants them. No employer can be blamed for not wanting them. The only conceivable place for them just now is the rendering of such services of hewing of wood and drawing of water as machinery still allows them, and that sphere becomes every day more contracted. For they are incapable of rendering the exclusively human services which society demands in larger and larger amount. This is the problem of our days,—what to do with that world of men and women outside of, and unfit for, the highly skilled and highly efficient organism which is making the millions of our national wealth. Cali they be left to the Poor Law ? No. For seventy years we have been gradually working out the principles of 1834. We have reduced the able-bodied pauper—who was the main object of concern in 1834—to the smallest limits. We have recognised the national duty of pro- viding for the sick, the insane, the aged ; and recognised it so fully that our Poor Law expenditure is double what it was when the able-bodied were the chief cause of the expense. But, so long as the unemployed keep above the margin of "destitution," the Poor Law can do nothing. Charity, indeed, does something, but what response has it to the entirely reasonable and honourable cry : "We don't want charity ; we want work" 13 And work is what we cannot give them.
It is not my intention in this letter to do more than state the problem. But surely the very stating of it brings out the fact that neither Free-trade nor any possible Protection can solve it. Alike in Five-trade countries and in Protected countries the constant endeavour is after further perfecting of the organisation of production and distribution, and it is this organisation that has left us with the great reserve forces who live in hope of being called out for active service, and never get the summons.—I am, Sir, &c., [Whether we agree or disagree with Professor Smart's remarkable letter, we must all admit that the problem of bow to make those who are, or at the moment appear to be, industrially superfluous fit into our social organism is a very difficult one. We trust that Professor Smart's letter will receive the attention it deserves, and that his brother-economists will subject it to a searching criticism. Though Free-traders, we take no exception to Professor Stuart's declaration that Free-trade by itself will never secure constant employment for all the people of the country. What we urge that Free-trade does, and that Free-trade
alone can do, is to provide the most favourable conditiond for securing constant employment. Free-trade is the only economic foundation upon which constant work can be estab- lished. And for this plain reason. Free-trade by facilitating: and so increasing, exchanges increases wealth. Protection, under whatever alias, produces waste and diminishes wealth. Therefore, wherever the solution of the problem of unem- ployment lies—we do not doubt that it lies to a great extent in moral considerations—the policy of free exchange must be the primary condition, the sine qua* non. That accepted, other considerations have to be examined and employed. We appreciate greatly Professor Smart's letter from the economic side; but it is equally valuable from the political. It would be most dangerous to allow the public to imagine that Free-trade is alleged by its advocates to be a certain preventative against unemployment, for if that notion were to prevail the first period of serious depression in the labour market would be used as an argument for Protection. "You see," the Protectionists would cry, "what a fraud is Free- trade. The Free-traders swore it was a certain cure for un- employment, and just look at the number of people out of work. It has been proved to be a sham." Free-trade is no panacea, no remedy for idleness, and will not enable the world to do without a sound industrial organisation. It is, however, as we have said, the base on which a sound social system on the economic side can alone be built up.—En. Spectator.]
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