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ECONOMICS

FOR BOYS AND GIRLS

BY

ALAN DANE

B.Sc. (Econ.) ; Lecturer in Economic*, Training" College of St. Mark
and St. John, London. Stanway School, Dorking. Formerly
Assistant Master of the Demonstration School of
the Froebel Educational Institute

LONDON

GEORGE ROUTLEDGE & SONS, LTD.

BROADWAY HOUSE : 68-74, CARTER LANE, E.G.

PRINTED IN GREAT BRITAIN BV
MACKAYS LIMITED CHATHAM

CONTENTS

PART I ECONOMY IN SPENDING
Ax HOME

CHAPTER PAGE

1 Aladdin's Lamp . . . . .3

2 A Job for Anyone's Mother . . . 10

3 A Job for Anyone's Family ... 17

4 One Family and Another ... 27

5 A Difficult Economy . . . -36

IN THE, : MARKET

* '-.: ''...-- :;-. ,>

6 The Magic Purse . . . -45

7 Is it Money we really want ? . . -56

8 Where do Goods come from ? 66

9 Where to look for the real Aladdin's Lamp 74

PART II ECONOMY IN PRODUCTION
ROBINSON CRUSOE ON HIS ISLAND

10 A Day on a Desert Island ... 83

11 Thinking It Out 91

12 Making a Store ..... 99

Vi CONTENTS

CHAPTER PAGE

13 Another Shipwrecked Party . . . 109

14 Round Pegs and Square Pegs . . 116

15 Agreements ...... 127

OUR POPULATED WORLD

16 The Road of Production . . . 136

17 Sign Posts to Guide Us ... 145

18 A Bend in the Road .... 155

19 A Mountain on the Way . . . 164

20 Rules of the Road . . . . 174

21 The " Road " Becomes a " Railroad " . 186

PART I
ECONOMY IN SPENDING

WHICH SHALL I CHOOSE?

CHAPTER i
ALADDIN'S LAMP

HAVE you ever thought what you would have done
with Aladdin's Lamp ? You will remember that it
was a magic lamp, and when the possessor rubbed it, a
fairy or genie appeared, ready to bring anything or to
do anything which the owner of the lamp demanded.

What are Your Wishes ?

What would you have asked for ? Probably a great
number of things would leap to your minds at once.
A motor-car, a bicycle with 3-speed gears, a camping
outfit for the holidays, a cricket bat, a pair of boxing
gloves, boots and shoes, beautiful clothes, a set of the
books which you most enjoy reading. There is hardly
any end to the things we should like if we start really
thinking about thehi. There is certainly no end to the
things we should like, if we include all the things we
should like to give to other people. Turn this book
over now and make a list of all the things you would
ask the genie to bring you. See how many you can
write down in five minutes ; then compare your list
with those of your friends.

Did any of you ask for a mediaeval castle, complete
with battlements and turrets, courtyards, knights in
armour, horses and pages! Or a cottage by the sea,
where you can bathe all day in the summer, or a fast
aeroplane to take you there for the week-ends, if you
live in London or Manchester or Birmingham, right
away from the coast ? Or you might ask for your

4 ECONOMY IN SPENDING

private ice-rink or your own football or hockey ground.
You have only to rub the lamp, and that is not very
difficult.

There is no necessity to ask for money from your
genie, because you would only have to go out to the
shops to spend it, and it would be much easier to ask
for the things you want to spend your money on. It
would save the trouble of going to the shops, and even
if you did, you might find they had not got what you
wanted. In fact, I should very much doubt whether
they could provide you with the mediaeval castle, and
I am sure they could not produce a live pterodactyl,
(ask someone to tell you what that is, if you don't know),
and that is one of the things I should certainly ask the
genie to bring, as I have always wanted to see one, but
am not very likely to do so now. So things are really,
in the long run, much more worth having than money.

Once I asked a girl what she would like, if all her
wishes could be granted, and she asked whether she
might ask for good health. I think that was something
much more sensible than the fast aeroplane or the
camping outfit or the live pterodactyl, for that matter.
A shop certainly is not any good in that respect, and,
though money does help, it does not always succeed in
getting you good health.

Only Three Wishes.

There was nothing very difficult about making a
list of the things you wanted. The difficulty was to
know where to stop. Suppose, however, that, when the
fairy appeared, he (or she) said : " Well, you can have
three wishes, but only three, and you cannot ask for
money as one of the wishes ! " You would need now
to be very careful.

I expect you know the story of the old man and his
wife who were allowed three wishes. The old man
did not stop to think. He asked at once for a jam

ALADDIN S LAMP

roly-poly gwidifigi-, His wife was so annoyed, that
she wished it would stick on the end of his nose.
And as she had forgotten the fairy was standing by,
ready to grant her wish, up rose the roly-poly pudding,
and on to the end of the old man's nose it plumped
itself. So there was only one thing to do affer IHaf7
and the last wish had to get the pudding off his nose
again. So in that way they wasted all their three
wishes, by not being careful and thinking out first
what they really wanted most.

Look through the lists of things you have made, and,
leaving out money, if you originally wished for it
(because it is not really one wish at all, but a great
number of wishes, since it can buy a great number of
things), try to write down the three things you would
ask for, if you were only allowed three wishes. You
will not find this so easy as in the first case, where your
genie allowed you all the things you wanted.

What will you have to do ? Obviously, you must go
through your list very carefully , and choose those things
which strike you as the most exciting or pleasant or
beautiful or desirable in some way or other. Actually,
by only being alto wed three wishes, you have been
ratione^ in the things which you were allowed to have.
Sometimes in times of great national difficulty or
danger, as during the Great War, the country runs short
of some very important conm^ciity, like meat or bread
or sugar or milk, and then, to give everyone a fair share
of what little there is, the Government has to step in
and say that nobody may buy more than a certain
quantity. That is called rationing people, and the
amount which they are allowed to buy is their ration.

This time, three wishes was your ration of wishes.
Since you could not have all the things you wanted,
you had to choose those which were most desirable to
you. You had to ration yourself. This you did by
asking yourself such questions as : " Which do I really

6 ECONOMY IN SPENDING

prefer, a pair of boxing gloves or a football ? " "A
new pair of shoes or a fox-terrier puppy ? " " A motor-
car or a cottage by the sea ? " " A meccano jget or a
camping-outfit ? " Often it is very difficult to decide,
and we find, sometimes, that we have chosen the wrong
thing, and that a new pair of shoes might really have
been more satisfactory than the fox-terrier puppy,
because the puppy ate up most of what remained of
our old and only pair.

Think First.

The great thing to remember is not to rush to make
our choices without first thinking over the matter.
Because, if we do rush, we may waste our wishes on
something we don't really want.

Suppose, for instance, somebody some rich uncle
came along and gave you a present of five pounds,
or ten shillings, or a shilling, even. Just before
you received the money, you might have been
thinking of a camera. You might rush out with
your ten shillings, and buy the camera, there and
then, on the spur of the moment. It might, of course,
be just what you wanted, and you would remain com-
pletely satisfied. But you would, nevertheless, have
been foolish, if you had not stopped to think first, before
you spent the money. After all, it might well be that
you would have to make that ten shillings last a long
time. Perhaps it was your only rich uncle who gave
it you. Perhaps you would not see him again for six
months or longer. That ten shillings then would have
to last six months. You could not always be taking
photographs, but during that six months you could
buy a new pocket-knife, and a box of paints, and a new
cricket bat, and still have some money left for sweets,
chocolates, or books.

It would be just the same if you had been
given one shilling or five pounds. It is really

ALADDIN'S LAMP 7

the same idea as with the three wishes. This
time you are rationed in money which we saw was
like a number of wishes, because you can buy a number
of different things with it instead of being rationed in
wishes. The more money you are given, the greater
number of wishes you can grant yourself. But in the
end you are rationed as to the number of things you
can buy with it. One day, five pounds will all be
spent, and one day even five million pounds would all
be spent, though it would take most of us a long time
to do it.

The important thing that you must bear in mind
is that, because you are rationed as to the number of
things you can get with your wishes, or with your
money, you must always think carefully what you will
do with your money or with your wishes before you use
either. If you have a shilling, and you feel that you
like hard-boiled eggs better than anything else in the
world, you must spend it all on hard-boiled eggs.
Probably that will cure you of your feeling. If
you have all hard-boiled eggs, you cannot have any-
thing else you cannot have a pencil-box or an orange
or a bus ride into the country. Whatever you do get
will mean that something else must be given up for it.

Economy.

So you must think about it first. The reason is,
that you want to make your shilling do the most useful
things it can for you ; just as your genie had to do the
most useful things for you that you could find for him.
You want your shilling to go the farthest way it can,
and to buy you those things which you really want
most of all. If you spend it all on ice-cream on Monday,
you will not have any more, perhaps, till Saturday ;
and then you will be sorry all Tuesday and Wednesday
and Thursday and Friday as well. Or if you spend it
all on ice-cream, think out all the things you gave up

8 ECONOMY IN SPENDING

for that ice-cream, which you might have bought with
your shilling. Was the ice-cream really " worth "
those things which you gave up ?

Making a shilling, or ten shillings, or five pounds,
or three wishes or 300 wishes go the farthest way
they can is called Economy. You do this because
you want to get the best value out of your money.
You can only get the best value out of your money by
thinking out well in advance what you really want,
and then seeing that you use just enough and no more
of your money for these wants and not for any passing
fancies. When you do this, you are economising.

It is really a very exciting and fascinating game
which everybody plays all their lives. Some play
it much better than others. Some people have
much bigger sums to economise with than others
have. They often find it much more difficult to
economise so well as people who have very little money,
and they often do it very badly, and then wonder why
they did not get much satisfaction out of spending their
sums of money. That is largely because they do not
think out properly in advance how to spend their
money.

Using your money, then, in order to buy yourself
what you really want in the least expensive way,
after the most careful thought you can give it, is the best
economy for you. You may find that you do not spend
all your money at once. If you have ten shillings,
perhaps you will spend five shillings to-day, and then
keep five shillings in case some brilliant idea strikes your
mind next week. Or you may wish to keep all your
money, because you may be going away for a holiday
next month, and you may want some money to spend
at the seaside or in the country. That is called saving
your money, so that you can enjoy it by buying things
later on. Or you may save it for a rainy day. If you
are a keen cricketer, you may like to keep a little money,

ALADDIN'S LAMP 9

in case you break your cricket bat. Or perhaps, if
you are fond of someone, you may spend some of your
ten shillings or all your ten shillings on that person.
Whether you spend your money or save your
money, or give your money away, you must always
economise with it. You must always think out as
carefully as you can as many of the different ways as
possible in which you can use it, and then decide to
use it in those ways which you are sure will give you
more satisfaction than any other ways. If you are
sure that to buy 12 hard-boiled eggs is the only use to
which you really want to put your shilling, then buying
12 hard-boiled eggs is your best economy of that shilling.
Second thoughts, however, will probably bring you to a
different conclusion.

Summary. If we had everything we wanted, there
would be no need to choose between things. Every-
body is rationed with regard to the amount of money
with which he can buy things. Therefore he must
think over carefully what things he really wants most of
all. This done, he should use his money to get these
wants if he can with the least expense. In this
way he " economises " his money. Using his money
for things not wanted so much, or using more money
than is necessary, is " wasting " money. Economising
money might mean not-spending, i.e., saving money,
if he decides that he wants to save.

Written work. Make a list (not more than 12
examples in each list) of :

(a) The things you would like to do.

(b) The places you would like to visit.

(c) The people who lived in past times whom you

would like to meet.

Then ration yourself to only three items in each list.
Put a tick against the three out of each list which you
would choose.

CHAPTER 2
A JOB FOR ANYONE'S MOTHER

Incomes.

Aladdin's Lamps are all very well, but they are
usually hard to find. Even rich uncles have a habit of
disappearing, or of finding other interests than their
needy nephews and nieces. So most of us have to put
up with what is called an income to provide for our
wants. That is a sum of money which comes in more
or less regularly. In some cases, a certain sum of money
may come in every month, or perhaps every three
months, or six months or even 12 months. Very
often your income is paid to you at the end of the week.
If it is paid to you weekly, your income has to last
you all the next week, and if it is paid to you every
six months, it has to last you the following six months.

Now, since their income is paid to them in most
cases, at regular intervals, your parents have to plan
ahead carefully how they will use this money. If
they did not look ahead at all, they would perhaps find
that they would spend the whole week's money in three
days, and then they might find they had not got any-
thing for the milkman or the baker or the butcher either,
for that matter, during the following four days.
Usually, therefore, your father and mother decide how
much is to be set aside for such expenses as rent and
clothing and coals and lighting, and how much is to
be spent each week on your food. That amount will
naturally depend on the size of the income to start with,
as well as on the size of the family. The money for

IO

A JOB FOR ANYONE S MOTHER II

food and for materials for the house is usually given
over to the mother, if the father earns the income,
and then it is her job to spend that money every day.
This is what is known as " housekeeping."

Housekeeping.

Some people think this is quite an easy thing to do.
Like most things, however, it depends on how you do it.
It is certainly not very difficult to go into a shop and
ask for a pound of sausages, or half-a-dozen oranges.
Nor was it very difficult, as we saw in the first chapter,
to spend your shilling entirely on ice-cream or hard-
boiled eggs. All you have to do is to go into the shop
and ask for them. But you should remember, if you
do spend all your shilling on ice-cream, or even part of
your shilling on ice-cream, you have to give up some-
thing else that you might have bought instead. The
proper thing to do is to sit down and think first.

That is just what a good " housekeeper " must do.
If she buys a pound of sausages, then she has to give
up something else. So she must first of all ask herself :
" Do I really want those sausages more than anything
else ? " Perhaps on second thoughts she will decide
that a piece of fish would be more satisfactory. Or it
may be that she will decide to have half a pound of
sausages and a tin of sardines. Now, when your
mother's money must last a certain length of time let
us say a week there are a whole week's meals which
have to be thought out in advance. The money has
to be planned, first of all, so that it lasts out the whole
week. It would be no good having big meals on
Monday and little meals on Tuesday and Wednesday,
and then a big meal again on Friday perhaps. Secondly,
as far as the money will allow, the good housekeeper
will try to buy a variety of food, because the same
dish get& very .boring, and it is better for your health
to have different things to eat, if you can afford it.

12 ECONOMY IN SPENDING

Amounts of Things.

There are a great number of other things to bear in
mind. The better the housekeeper, the more she will try
to fit in her expenditure on any special food with all the
expenditure on other foods. She must not get too much
tea, if her family is going to drink cocoa as well. If she
buys a lot of meat, they may have to go without fish.
If she buys jam, then perhaps they must give up manna-
ladejDa; something else. In other words, the thoughtful
housekeeper must continually " economise/' She must
keep on thinking out carefully how far her money is to
go ; what is the best way she can use that money ;
and which ways will give her family more satisfaction
than other ways. To do all this, she keeps asking her-
self what they must give up, if she spends her money
on one lot of things rather than on another. Having
decided what things she really does want to buy, she
then sees that the things she cannot have must be gone
without, that week at any rate, and off to market she
goes.

Before we follow her to market, however, it would be
a good plan for you to put yourself in her place, and to
see if you can plan out her expenditure yourself.

Let us imagine that your family consists of your
father and mother, a brother or sister and yourself.
There are four of you, then, in all. It would not be
very difficult to write down all the things you would
like to eat and drink during that week when you are
housekeeping. But if you ordered all the things you
would like, your father would not be very pleased when
he saw the bill. It would be like Aladdin's Lamp
without the genie. If we could have all we wanted
without any effort on our part, or without paying for
it, there would be no need to economise. You can try
writing down all the things to eat which you would like
to have, during a whole week, if you had not to bother
about paying for them. See how many you can manage

A HOUSEKEEPER'S JOB

14 ECONOMY IN SPENDING

to think of in three minutes. Compare them with those
of somebody else, and see if many of the things are the
same.

Prices of Things.

Now imagine that you are doing your mother's job
for her, to give her a change or a rest, and suppose that
your father gives you i to spend on food which must
last all four of your family the whole week. Try to
write down how you would spend your money now. I
think you will find that it is very much more difficult
than you may have thought. In order to make your
i go as far as possible to " economise " as well as
you can to spend your money so that your greater
wants are satisfied and not unimportant ones you will
find that you have got to know the prices of a great
many things. It is no use saying you would like to
have sausages for breakfast, unless you know how much
sausages are going to cost you. Because you may find
that four sausages one for each of you will cost you
more than you want to spend, and that you would
prefer to keep the money and buy kippers for your tea
instead.

Choosing between things.

In either case, whether it is sausages or kippers which
you are going to buy, you must know the prices of both
sausages and kippers before you can decide. You
must know a great deal more, too. We saw that we had
to economise, because if we buy any one thing, we have
to go without something else. Therefore, to economise
really skilfully, we ought to know the prices of all the
things we may go without. Those things are called
alternatives. Anything which we could have bought
instead of the sausages is an alternative. It might be
eggs or bacon or sugar ; or even a turkey, if we think
of a great many pounds of sausages.

A JOB FOR ANYONE'S MOTHER 15

During the next two weeks, you should try to find out
the prices of as many of the things to eat and drink
which you think you might want to buy, if you were
acting as housekeeper to your family, as we have
imagined. Then consider how much of each thing you
will buy. Remember that there are four of you, and you
are being given a fixed sum of money to spend. It need
not necessarily be i. If there are a number of you in
a class, and you like to decide on a larger or a smaller
sum to spend, you can just as easily do so ; but you
should all fix on the same sum, so that you can compare
your lists together. You might also try to make the
list for yourselves, without anyone's help, beyond
finding out the prices of the different things you may
buy. When you have made them out, you should
bring them together with those of your friends, and then
you can tick the things and the amounts which you all
decide are the best, (considering the limited amount of
money you have to spend), and you can write down on
your list those things which you left out, but which
you feel ought absolutely to have been included.

Summary. People are usually only able to spend
their incomes. A part of this income must be spent
buying food for the family, or " housekeeping." A
good housekeeper thinks out, not only what food is most
needed for the house, but considers also what are the
prices of that food, and what she must give up to get it.
Things she must give up are called alternatives. When
she has fully thought this out, she uses her money to
buy as much of her greatest wants as possible. Thus
she economises her money.

Written work. This is a list below of a part of our
nation's housekeeping. In the year 1930, our country
spent, either nationally or locally, the sums of money
shown against the different items. The total comes to

l6 ECONOMY IN SPENDING

570 millions. If it were necessary to cut down the
total by 100 millions, how much would you cut off
the different items, and which items would you cut and
by how much ? Give reasons to support why you
think your decisions are the right ones.

Object on which money was Amount

spent. spent.

Army . . . . . . . . 32 millions

Navy 43

Air Force . . . . . . 16 ,,

Education . . . . . . 104

Housing 37

Old Age and Widows* Pensions 72 ,,

War Pensions .. .. .. 49

Health Insurance . . . . 39

Hospitals.. .. .. .. 12

Lunacy 5

Unemployment Benefits . . 102 ,,

Poor Relief . . . . . . 43

Law and Justice . . . . 16 ,,

Total 570

CHAPTER 3
A JOB FOR ANYONE'S FAMILY

Family Expenses.

Some of you will have made out your lists for the
week's food expenditure for your family of four. You
must now think about a wider range of things, on which
all families have to decide how to spend their incomes.
As you all know, there are many other ways in which
money must be spent than merely on food. Each
family, we saw, has a limited income, and parents have
to decide how to spend that income to satisfy their
more important wants in the least expensive way,
that is, in the most " economical " way.

Now what a family would like to have, and what it
can have, are obviously two very different things. We
saw that Aladdin's Lamps and rich uncles do not often
come our way, so we must do the best that we can
with the income we have for the time being.

It would be good practice if, where there are many
of you together, you arranged yourselves in couples.
Each couple would represent a father and a mother of
the family ; it does not matter which you pretend to
be, as both are equally important, and you can both be
father and mother at the same time, if you prefer.
Then you must consider what you would do with all
your income, just as you did for the food expenditure.
Only, in this case, you need only put down the ten most
important things on which you spend your money.
Arrange them in their order of importance, and do not
try to say how much you would spend on each, as that
c 17

l8 ECONOMY IN SPENDING

is yet rather too difficult. You must choose between
different things, but you need not say how much oi
each thing you choose.

At the end of this chapter is a list of some of the
most necessary items for which, whenever possible,
every family should try to put aside some of its money,
Do not look at it, until you have made out your own
list. When you have done this, turn to page 25 and
look at my list.

Group 1. Necessities.

It is difficult to think of any family not being able to
provide the things in the first group of our list. These
are called the bare necessities. It is very sad to think
that there are people who have to go short of food or
heating, or who cannot afford to buy new clothes when
their old ones are worn out, or who have to leave their
homes because they cannot pay their rent. It is never-
theless true that a great many unhappy people in
England are still in this position. Their numbers in
proportion to the total population have very greatly
declined in the last 100 years, though there is still
room for much more improvement.

I think every one of you will have included Food
in your list. You would be very unthoughtful parents
if you had forgotten that item. I do not suppose many
of you left out Fuel and Light. Fuel, of course, includes
coal and gas and, in those houses which use it, electricity
for heating. Sometimes oil is used for heating. Fuel is
necessary also for cooking, and a good " economical "
housewife will remember, when choosing her food, that
some kinds of food and cooking like plum-puddings
will require much more heating than others, and there-
fore need more expenditure in fuel stuffs. I think we
can say that light is a necessity nowadays. It would not
have been considered to be so not so very long ago, when

A JOB FOR ANYONE S FAMILY IQ

most people had to go to bed very soon after it was
dark, because the lighting materials were so scarce and
so expensive. Nor is light considered a necessity to-
day in Russia and in some other lands.

Sufficient Clothing is certainly needed by us all.
What we may consider sufficient, of course, depends
upon what we have been used to have. If we have
been lucky in having a large income to spend, we might
think a good deal more in the way of clothes is necess-
ary to us than other people might think. Probably it
would be better, therefore, for other people to judge
what is " necessary " for us. It is quite certain, how-
ever, that clothing should be sufficient for all members
of the family, so that they shall be protected from cold
in winter, or from too great heat in summer, and so
that it shall keep out the wet on rainy days. Most
of us also require that our clothes should look pleasing,
and, if possible, even beautiful. This is quite right,
and it is very desirable that clothes should please us
in that way. It is, however, not exactly a necessity
that they should do so.

Laundry and Cleaning materials, like all forms of
washing, are a necessity in these days because, unless
clothes and linen and bodies and rooms and pots and
pans are kept clean, dirt breeds disease and illness and
ill-health ; and all reasonable actions on our part to
prevent these are a necessity as well as a duty.

Rent and Rates must be paid by all families. Some-
times they are paid together, as is usual when people
live in flats instead of in houses ; sometimes they are paid
separately. Rent is what you pay to the landlord who
owns your house. If you own your own house, it means
that you have paid a lump sum of money for it. Hence
your income (what comes in to you every week or three
months or year) is so much less, because that lump sum
of money would have brought you in interest, if you had
lent it to a business man (invested it) instead of buying

20 ECONOMY IN SPENDING

your house with it. This is really just the same, then,
as paying rent to another man who owns your house.
Rates are sums of money paid to the local authority,
the Town Council or County Council where you live.
They have to be paid by all householders for the services
the Council performs on their behalf. I shall not
tell you what those services are at present. It would
be a good thing if you could find out for yourselves in
the meantime. For instance, have you ever thought
where the water for your bath comes from ? or who
supplies it ?

All these ways of spending the family income, then,
are the most important, and therefore come first.
Until you have set aside enough money for these, you
cannot begin to think of a motor-bicycle or a holiday
at the seaside, or a set of your favourite author's books,
or a nice comfortable armchair ; because you would
get no real enjoyment from your holiday or from your
armchair if you had no proper clothes, or not enough
to eat.

As far as our list is concerned, then, you cannot think
of bicycles or books and such things as yet. You have
a real responsibility on your shoulders, and you have to
think about the welfare of your whole family as well as
of yourselves. There are a great many things more
important than holidays or motor-bicycles.

Group 2. Further Expenses.

In the first place, among the expenses which come
immediately after bare necessities is insurance. Most
people nowadays are insured. That means that they
pay a small sum of money weekly or monthly or yearly
in return for a lump sum later on, or for certain services.

For instance, sometimes you have to be insured
bylaw, under what is called the State National Health
Insurance Scheme. You have so much deducted
weekly from your wages, and, when you are ill, the

A JOB FOR ANYONE'S FAMILY 21

State arranges for a doctor to look after you
free of charge. You are also often insured against
unemployment, accident and old age. The advan-
tage is that, because nobody can ever be sure
whether or not he or she may be ill or have an accident or
lose his job, by paying a little money every week, you
can be sure that you will have the means of getting well
again, of paying the doctor's fees, of being helped by
receiving an income (even though a small one) if you
are out of work, or having an income (only a small one),
if you have an accident and become an invalid. In
this way your life becomes more secure ; ~and if you
suffer any of these unfortunate chances, you do not
become a burden on anyone else, and your life is happier
than it otherwise would be.

Many men feel it is their duty as well as their
wish to insure their lives, so that if they die, so
much money is given to support their wives or children.
By giving up so much income now, the family gains
the feeling of relief from uncertainty regarding the
future. Unless families are rich and own a large amount
of property, it is always a most serious thing for all the
members if the father of the family dies or has a long
illness.

Again, many people insure their property against
fire or burglary or other accidents, as, however careful
you are, you can never be quite sure that a fire may not
break out in or near your house and destroy all your
belongings ; and it is better to pay a little every week,
even though you never have a fire, than to run the risk
of losing all your property, which you could not afford
to replace.

Insuring your life in the way I have just explained
is one way, and a very good way, of saving money. If
their income is large enough, most people save some-
thing for the future. This is for many reasons. Partly,
just like insurance, it makes your whole life more

22 ECONOMY IN SPENDING

secure. It is all very well enjoying life for 40 years,
but if you are likely to live 60, and if you are not likely
to be able to go on working more than 40 years, you
must have some money to fall back on for the extra
20 odd years. So you decide to save for that future
time when you can no longer earn money. The State
helps you in this by giving an Old Age Pension to all
people over 65 who have belonged to their National
Health Insurance Scheme.

You may save up, also, not for your old age, but for
something in the much nearer future. If your family
wants a summer holiday, you must put aside a little
money all the year round to make it possible for you
and your family to go away ; or you may save up for
a good plump turkey for Christmas ; or for a wireless
machine or for a piano. All large expenses outside the
ordinary weekly or monthly ones need saving to make
them possible. Very often clubs exist, holiday clubs
or Christmas clubs, to which you pay your saved
money each week. This makes it more difficult for
you to spend your savings before you have got what
you originally intended to buy. How much you will
decide to save is a difficult question, and depends
chiefly on the size of your income.

Then there are other expenses which must be met, if it
is at all possible. Nowadays many men live a long way
from their jobs, and many women live a long way from
the market where they buy their daily goods. Even
though the shop people come round to the door, it is
often better and cheaper for the mother to go to market
herself. To walk or to bicycle to your work is often
tiring. Sometimes the man lives too far away to make
even that possible. It means getting up earlier in the
morning, and if work is hard and tiring, a good night's
rest is necessary to help him to do well during the day.
So some money must be used to pay the Fares charged
by the railway companies or by the tram or omnibus

A JOB FOR ANYONE S FAMILY 23

companies, who provide the transport to get the father
to business, or the mother to market. If you were very
poor, you would not be able to afford this, and you
would either have to walk or try to get a house nearer
your job. So, it is not quite a bare necessity, though it
is very nearly one.

Next there are what are called Household Renewals.
That means re-newing, or making new, those things
which wear out or which get spoilt or lost. Things do not
last for ever. Kettles get thin and begin to leak ;
gtj^oken ; cloths and towels wear into
taps lose their washefsltfter^
ever the reason may be, you have to make them new
again. If you can, you mend them ; if you cannot do
that, you must buy new ones. That means that you
must always allow a little money every week to be
spent on renewing your goods and tools. It is rather
like saving ; but it is different in this way : that you
save for something extra or unforeseen, but you put
aside renewal money for what you ordinarily must
have and must use. All businesses do the same thing ;
they create what is called a Reserve Fund for this
purpose.

If there are children in your family, you must think
about their Education. A great deal of education is
now provided free by the State, but it is always possible
to spend your own money on your children's education
also, if you can afford it. In this way, you can buy the
means of their taking special classes which would assist
them in any special way, which you thought might
be helpful or enjoyable for them in later life. You
can provide the money for them for a certain kind of
engineering class ; or a drawing class ; or ordinary
school work of a higher standard than that at which
the State's free education ends ; or dancing ; or dress-
making ; or jfiinglX- You might even help your
children to get books or papers or pencils so that they

24 ECONOMY IN SPENDING

can help to educate themselves. In whatever way you
decide to do it, you will probably feel that it is a real
necessity and an expense which must be met, if you
possibly can afford it. Many men and women who
have educated themselves have even found it is a bare
necessity. By that, I mean they have definitely cut
down their food or their clothing beneath what most
people consider the lowest figure to keep a person in
health, in order to buy themselves or their children the
means to obtain knowledge and learning. Whether
they are right to do so is a question each person must
decide for himself or herself.

Lastly, there is always the possibility of sickness in
your family, however careful you are. The Health of
your family is one of the most important things which
you must bear in mind. (Happily, the nation as a whole
suffers far less.from serious outbreaks of illness than in
bygone days, y Nevertheless, a certain sum of money
should be set /aside for such times, though it is to be
hoped that they will come very seldom. Even though
medicine is usually provided free under the National
Insurance Scheme, there is always extra expense for
food and heating and lighting needed in times of ill-
ness.

You should now take my list and compare it with
your own list of the ten most important things which
you should provide out of your income for your family.
Tick off those on both lists which are the same. Con-
sider whether the remaining items on your list, without
a tick, have a better claim to be on the list than the ones
on mine without a tick. You will see that there are no
specially enjoyable expenses on my list. Although we
have talked about holidays, I have not yet included
them. Nor have I put in visits to the cinema, nor
books, nor footballs, nor picnics in the country, nor
visits to the Zoo. That is because I feel that you ought
to decide first how much you should spend on the bare

A JOB FOR ANYONE'S FAMILY 25

necessities or the further expenses. And the reason
for that you must look for in the next chapter.

List of Family Expenses.

Group i Necessities. Food. Clothing. Rent. Fuel.
Laundry or Cleaning.

CLOTHING

RE NT

CLEANING

j

OTHERS

UE.L AND
L*1CHT

FAMILY EXPENSES

Group 2 Further Expenses. Insurance. Fares.
Household Renewals. Education. Health.

26 ECONOMY IN SPENDING

Summary. Other expenses occur for the family
beyond buying food. These expenses satisfy different
wants. The most pressing wants are called necessities,
and good economising uses the family income to satisfy
these wants before others less pressing.

Written work, At the end of this chapter you have
read my list of the ten most important items on which a
family should spend its income. What do you consider
the ten next most important items on which they can
spend their money ? Supposing, of course, that the
family income is large enough to buy the things.
Arrange your list in order of importance.

CHAPTER 4
ONE FAMILY AND ANOTHER

UNLESS you can buy a certain amount of food, have
a certain warmth and cleanliness of house and clothing,
and be protected against wet and damp, you will not
be able to keep in good bodily health. Sufficient food,
sufficient housing, sufficient warmth and cleanliness are
the actual necessities to preserve life. That is the
reason why I said at the end of the last chapter, that
you should place expenditure on those things before
any of the more pleasurable or more interesting or more
exciting forms of spending your income.

A Bare Living.

Broadly, what we considered as the sum of money
needed to buy the bare necessities and the further
expenses is known as the Subsistence Level. That is,
it is the smallest sum which is needed just to keep a
family alive, and to prevent it from getting weaker in
mind or in body.

It is difficult to say what is that actual weekly
sum of money for a person to-day. That depends
on a great many circumstances. For instance, a
man needs more food than a woman, because food
builds up energy and power, and a man usually has to
spend or to give out more energy and power in his daily
work than a woman. Similarly, a growing boy or
girl of 15 will require more food than a child of 6 or
10, because he or she is bigger and needs more. Then
again, if you live in the country, you may have a garden

27

28 ECONOMY IN SPENDING

to your house, or at any rate an allotment, near at hand,
in which you may grow vegetables, which help you to
meet the food bill. Or you may live in a town where
there is very little housing accommodation near the big
factories, so that rents are high and the money needed
for mere subsistence is, therefore, higher than it would
be in other districts. If you live in a cold, blgak district,
your weekly money should be a little higher than in a
warm sheltered one, because you will need more coal
in winter and warmer clothes.

Food for a Family.

In a rough and ready way, it is possible to estimate,
that is, to work out, the smallest amount of money
weekly which is needed for a family just to exist. Of
course you would have to say how big your family is.
When expert and experienced men or women make
this calculation, they generally take as the basis of
their figures what is called a Standard Family. That
is a family of five people. It includes, of course, a
father and a mother and three children under the age
of 16. These experts have also calculated, by investi-
gating, or examining, the weekly budgets of a large
number of families, that before the War, in 1914, nearly
two-thirds of their total incomes were spent on food.

On the opposite page is a table of food for a week,
which was considered necessary for a Standard Family
in 1914.

Remember that five people have to live on this food,
and that it must last a week. How much fresh milk
will each member of the family get every day, if five
people share g\ pints in a week ? Would it amount to
half a glass ? And then bear in mind that you can't
make a milk pudding without some milk, however
stocjgy it may turn out. Perhaps one of the children
is only a baby. That will mean more milk to be bought,
but less meat. Do you think that would balance out ?

ONE FAMILY AND ANOTHER 29

Weekly food for a Family in 1914

Ib. s. d.

Bread and flour 33! 424

Biscuits, cake . . . . . . 05!

Meat sold by weight and sausages 7! 4 io-|

Bacon . . . . . . . . i 12

Other meat and fish . . . . i o

Lard, suet, etc. . . . . . . i o 7!

Eggs No. : 13 ii

Fresh milk . . . . Pints : 9^ i 4!

Condensed o i|

Cheese Lb. : i o 7l

Butter if 2 oj

Margarine . . . . 02^

Potatoes 15! o n

Vegetables . . . . . . 07

Fruit (fresh) 05

Rice and tapioca . . . . Lb. : i| 4i

Oatmeal . . . . . . ,, i o 2|

Tea ... f i 2\

Coffee o ij

Cocoa . . . . . . . . 3i

Sugar .... .. .. 6 11

Jam 05

Syrup . . . . . . . . 01

Pickles . . . . . . . . o i

Other food . . . . . . 9l

Meals out . . . . . . . . 06

24 ii

The Cost of Food.

The total cost of all these things in 1914 was 243. nd.
You should all find out for yourselves how much it
would cost to buy the same things to-day. You can
do this by enquiring at the actual shops where you buy
the things, or by asking your parents or anyone likely

30 ECONOMY IN SPENDING

to give you an accurate account. You can compare
your results one with another, and see how near they
are to each other.

The Government now, through the Ministry of
Labour, makes an estimate (that is a calculation)
of the money needed to buy these things every
month. It also adds what is required for our
Standard Family for such things as Rent, Fuel and
Light, Clothing, Insurance, Fares and Sundries. The
total is known as the Cost of Living.

If the amount of money needed to buy the
same things is greater one month than before,
it is said that the Cost of Living has " gone up."
Or it may be that the Cost of Living may " go
down." If twice as much money were needed
to buy the same things, the cost of living would have
risen 100% that is, it would have been doubled. You
should work out, if you can, how much per cent., greater
or less, is the cost of these articles of food which you
calculated for to-day, compared with the 243. nd. which
they cost in 1914. Has the cost of living risen or
fallen? You should check it with the Government
figures which are published in most newspapers once a
month, or in the Ministry of Labour Gazette. It is
not very difficult to find these figures if you ask people
to help you.

How Families Spend Their Money.

Not very long ago, 1 an enquiry was made into the
incomes of different people, and how they spent those
incomes. In other words, how they economised.
These were actual incomes and actual expenditure, not
those merely of a " standard family." The results
obtained showed some very dreadful facts. In other

1 These figures were analysed by Mr. G. L. Schwartz and are
published in full in The Listener of July I5th, 1931, by whose kind
permission these extracts have been made.

ONE FAMILY AND ANOTHER 3!

words, there were some people whose incomes were
definitely below that of subsistence level. There were
also a great number of people whose incomes would be
at just about the subsistence level. I am giving you here
five of these budgets. You will see for yourself what
economy these people were driven to use, and how
necessary it was that they should practise the very best
possible economy, because they could not afford to
waste a single penny.

Income.

s. d.

Case A. An Ex-Service man Unemployed 23 o

,, B. A Country Labourer . . . . 39 o

C. A Postman . . . . . . 48 2

D. A Miner . . . . . . . . 60 o

E. A Policeman 102 6

Each of these different people had families to support,
but, as the ages of the people in their family differ, we
must try to make some proper allowance, so as to be
able to compare those families when we want to know
how much food each family requires. To do that, we
can employ the following method, which is used to
reduce the food-requiring values of each individual to a
percentage of a grown-up man. This is the table which
permits us to do this, and which is used by experts in
these enquiries :

An adult (grown-up) man requires i-o ration of food.

woman 0-83 as much food

as a man.

A boy over 14 years 1*0 ,,

A girl over 14 years 0-83

A child between 10 and 14 07

6 10 0-6

o 6 0-5

nl'i

1 5! Alt' \N

HOW MUCH THEY NEED TO EAT

ONE FAMILY AND ANOTHER 33

We see that a man and woman together = i-o + 0-83
adult men = 1-83 of what food two men need. When
we make these allowances for all the individuals, adults
and children, in the five families whose budgets we are
investigating, we find the following results :

Case A. The Ex-Service Man needs

food for . . . . 3 -49 adult men.
B. The Country Labourer needs

food for . . . . 3-68

,, C. The Postman needs food for 2-33 ,, ,,
,, D. The Miner needs food for 5-23 ,, ,,
E. The Policeman needs food

for 3-33

We are now in a better position to compare these
families. If we divide the income, as shown on
page 31, by the number of adult people in each
family, we find how much money there would be
for each person in the family, if all the members
were adult men. This is necessary as, obviously,
a family of grown-up children needs more food and
clothing than a family of young boys and girls between
6 and 10. If we do this, then we get the following
results :

Income available for each individual of family, if all
persons were adult men,

s. d.
Case A. Each adult man has . . 59 per week.

99 -*^ 99 99 99 * * -^ / 99 99

{*> 99 99 99 99 ^O O ,, ,,

J-^ 99 99 99 99 H ^ ,, ,,

99 -E*' 99 99 99 99 3^ 9 " **

34 ECONOMY IN SPENDING

We see, then, that the members of the ex-Service
man's family (A) are insufferably badly off. Remem-
ber, this is their total income for all purposes, not only
for food. There is not much difference in the position
of the country labourer and the miner, because,
although the miner's wage is larger (see page 31), his
family is considerably the larger too (see page 33).
The postman is twice as well off as the country labourer
from the point of view of meeting his needs, although
his money wages are by no means double the country
labourer's. And the policeman is much better off than
the others, because his wage is larger.

Summary. Every family needs a minimum of food
to keep up bodily health and strength. The money
just to buy this is known as the Subsistence Level.
It varies as the prices of foodstuffs go up and down.
This variation is called the Cost of Living. In consider-
ing how much this money needed for subsistence is for
any single family, we must consider who are the members
of the family, because young children need less money
for food subsistence than grown-ups. We can compare
any family with a " standard family " on whose needs
the cost of living is worked out.

Written work. Either : i. A certain man's wages
in money in 1924 were 455. His wages to-day are
now 405. The cost of living to-day, however, is
only 80% of what it was in 1924. Is the man
" better off " or " worse off " to-day compared with
1924?

Or : 2. A man and his wife put aside 2os. a week
for their food in 1924. To-day they have three children.
One is aged 12, one is aged 8, and the other is aged 3.
They now set aside 303. a week for the whole family's

ONE FAMILY AND ANOTHER 35

food. Supposing that the prices of foodstuffs have not
changed, and that the food is divided among the
family according to the table on page 31, do the man
and his wife get as much to eat now as they did in
1924?

CHAPTER 5
A DIFFICULT ECONOMY

Now let us look and see how each of these individual
families in the last chapter actually economised. If
you look back at Chapter III, you will remember
what were the items which must be first borne in mind
in dividing up the family income weekly into different

ITEMS OF EXPENDITURE

kinds of expenditure. You should consider the incomes
of these actual families, and think for yourself how you
would spend the money available for the different
families.

How did they themselves divided their money
resources between the possible uses to which they could
put them ? In other words, how did they actually
economise their money ?

After dividing up their expenditure in different ways,
we can compare their choices in the table on the opposite
page.

A DIFFICULT ECONOMY 37
Family Spending.

ITEMS OF EXPENDITURE WEEKLY OF 5 DIFFERENT
FAMILIES.

A. B. C. D. E.

Rent and Rates . . 6/6 7/6 6/- 9/9 24/4

Food ...... io/- 18/8 23/6 30/- 31/8!

Clothing and Laundry 2/6

Fuel and Light . . 2/- 5/- 6/4 3/10 4/8

Cleaning Materials . . i/- 6d. 2/6 5 d.

Insurance . . . . i/- 3/10 2/8

Husband's Expenses 2/6 5/- 4/3 2/6
Amusements, News-

papers, etc. . . 1/9 i/-

Savings . . . .

Holidays . . . .

Fares . . . .

Charities . . . . 3/3

School fees . . . . 1/6
Miscellaneous, includ-

ing doctor's fees,

household renewals,

Not classified . . . . 3/1 3/6 8/7 31/5

Now you should be able to see that good economy is
not a very easy job to tackle. I expect you will at once
see that there are a great many things which you think
ought to be in the lists, but which are not there.

For instance, there is no money allowed for clothing in
A's family. What do they do when their boots wear
out ? Nor is any money allowed for fares by any of the
families, unless it is taken out of the " not classified "
group, which refers to the money which is spent on odds
and ends of different kinds. Do you ever upset the
crockery and break a plate or dish ? Where will the

38 ECONOMY IN SPENDING

money come from to buy a new one ? How do A, B and
D families find money to buy one another Christmas
presents, or to pay the licence for the dog ? Somehow
or other the money has to be found, and it can only be
found by foregoing that is, by doing without some-
thing else.

What they " do without/'

What can they do without ? Broadly, either they
must stop paying their rent, and, if they do that, they
risk losing their house and being turned out into the
road ; or they must put less aside for insurances, and
if they do that, illness may find them with little or no
means of buying the medicines or holidays they require ;
or they must spend less on their food. This is perhaps
the easiest source of economy. Do you think it is the
wisest ?

Food Needs.

The answer to that question will depend, of course,
upon how much is already being spent on food in rela-
tion to the number of persons who have to live on it.
Not long ago (1931), it was calculated that a grown-up
person or adult man needed at least about one shilling's
worth of food per day to keep himself in bodily health
and strength. That is, of course, 73. per week per
adult. Some people in 1933 thought 53. io|d. was
enough ; we will assume 73. a week is a more correct
figure.

Let us now consider again our five different
individuals and their weekly budgets. If we accept
is. per day as our minimum standard for food expendi-
ture, then we should find that the smallest amount
which each of our five families should spend on food
can be calculated as follows :

A DIFFICULT ECONOMY

Equivalent
no. of adult

men in family X

Case A 3-49 x

B 3-68 x

C 2-33 x

D 5-23 X

E 3-33 X

Expenditure

needed for

i adult man

i /
7/-

39

Expenditure

needed for
the family

24/5
25/9
16/4

36/7
23/4

The last column shows us what each family should
spend on food alone. Why is the amount needed by
the miner so much greater than that required by the
postman ?

Let us now put down, side by side with the amount
each family requires to spend in food to keep in proper
health, the amount it actually does spend. We then
have this table :

Amount actually Amount

spent on food required

Family, per week (cf. for food per

page 37). week (as
above).
Unemployed
ex-Service

man . . io/- 24/5
Country

labourer 18/8 25/9

Postman 23/6 16/4

Miner . . 30/- 36/7

Policeman 3i/8 23/4

Amount spent

gr eater (+) or

less ( ) than

amount required

per week.

-14/5

+ 7/2
- 6/7
+ 8/4*

We pointed out on p. 34 how terribly low was the
income of the unemployed ex-Service man. You can
see now what that means in terms of the food which he
has to go without and which he needs as a bare
minimum to keep his family in health.
The postman and the policeman are both able to buy

40 ECONOMY IN SPENDING

more than a bare sufficiency of food. The country
labourer and the miner, however, do not get enough.
We must be careful to remember that the country
labourer is jnuch more likely to be able to grow some of
his food, such as vegetables, for himself in his garden,
than the other families unless, at any rate, they have
allotments. This is often not easy in big towns. This
food grown on his own land would not be shown in the
table, and to that extent his position may be just a
little better off than it appears.

This is not necessarily typical of these different kinds
of workers. There are many labourers in the country
and many miners who do get sufficient food, although it
is true that, at the present time, wages are low in both
these kinds of work. There may be postmen and
possibly even policemen who do not get sufficient food,
though I do not think it is at all likely, and there would
be very special reasons to account for it. The cases
we have taken are particular cases and not intended to
represent other people in the same kind of job.

For a great many years since the War, which ended in
1918, there have been a large number of men who,
however hard they have tried, have been unable to find
work. These men and their families have had to live
on a small income provided for them by the State.
A man and wife might receive, in full relief, about
26s. per week.

In 1934, there are still over two million men and
women and their families in this condition. You do not
need much imagination, when you consider the difficult-
ies of economy in this chapter, to realise the tragedies
of their homes.

We can see then that if they were hard pressed to it,
the postman and the policeman might economise on
their food if they were really very keen to save up some
money for a holiday, or a motor-bicycle, or some new
furniture. That is because the money they do spend on

A DIFFICULT ECONOMY 4!

food and other necessities and further expenses is above
the minimum which they need. You are in a position to
decide now yourselves, whether economy in food would
be wise economy for either the unemployed ex-Service
man, or for the country labourer, or for the miner.

When there is very little money to spend, you must
make every penny go as far as it is possible. In other
words, when there are a great many wants, and very
little means of satisfying them, we should be very
careful to see that nothing is wasted. In the matter
of food, this is particularly important. We require food
to give us strength and warmth and energy. Now,
some kinds of food give us far more strength and
warmth than other kinds. For instance, meat bones
boiled down for soup, swedes, fish and chips, cocoa
and margarine are all fairly cheap and are very nourish-
ing. Although cheap, however, they are often beyond
the means of the unemployed families. Calculations
on these lines were made by certain scientists and
doctors, who came to the conclusion that 5s. io|d. per
week was sufficient in 1933 for an adult man's food, to
keep him in proper strength and warmth. Possibly
this may be true for one week. But if you consider a
man living week after week on exactly the same food
and with little or no variety, I think that most people
would agree that he would become ill in the long run
from very distaste at seeing always the same dishes
of food. In other words one must use one's imagina-
tion and consider not only the body value of the food,
but also the effect of the food on the mind.

We must remember, then, that the best economy,
when buying food, is not only to think of the quantity
of food, but also to think of the quality of food. For
the same amount of money, spent on food, a good
housewife can buy, perhaps, double the amount of
strength- and health-giving properties as compared with
those bought by a bad housewife. We should call the

42 ECONOMY IN SPENDING

good housewife, then, an economical one, because she
gets what she wants with the smallest possible amount of
expenditure of her scarce housekeeping money.

True Economy and . . .

The same principle of economy can be seen in a great
many ways of life. Why do owners of factories put in
machinery in their works ? Because they find that
machinery will turn out more goods very often than the
men who would otherwise be employed ; and it costs
less of their scarce money, in the long run, to buy
machinery than to employ the labour, taking into
account the greater number of goods the machines turn
out, compared with what the men can make without
them. Why do you usually take the shortest way to
go to school ? Because you want to get there with the
smallest possible amount of expenditure of time and
effort. You are economising your scarce time and
strength. You have only got 24 hours to each day,
and even the strongest of us get tired after doing a
certain number of different things.

False Economy.

You should, however, always be careful to consider
whether your economy will bring you what you really
want. If it does not do so, it will be false economy.
If you want a good pair of socks, do not use the cheapest
wool with which to knit them. You will not use much
of your scarce money, it is true ; but you will not get
what you want. What you or your brother will get
instead, will be a bad pair of socks, which will go into
holes, probably, the first time you wear them. Then
you will have to pay more in the end to buy wool with
which to darn them.

A man may want to make a lot of money, and he may
drive all the workers in his factory to speed up their
output. This may succeed for a short while, but soon

A DIFFICULT ECONOMY 43

the workers will strike, or they will leave his factory
because they dislike being over-pressed. Then the
stoppage of work may result in his losing more money
than ever he made or was likely to make by " speeding-
up " the machines. This man economises badly in his
use of his men's work. He does not get what he really
wants, because he does not look far enough ahead.
What he thinks is economy is only false economy.

Some of the most important problems of modern
society are concerned with this very same problem of
true and false economy. We say that factories and
machine work are good because they make us all richer.
No one can deny that we are better housed and fed and
clothed as a result of this kind of production. But
men and women are not so happy in their work as they
used to be before the machines did so much of it. If
our object what we really want is to be rich, then
factories and machine work are " good economy " of
our work and of our time. But if what we really want
is to be happy, rather than to be rich, then it is not so
certain that machines (at any rate, machines used as
they are now) are " good economy." You must give
the matter much more thought.

This is what is meant by the old saying : " Penny
wise, pound foolish." Though really it is the unwise,
not the wise, penny which costs the foolish pound.

Summary. In these examples of family expenditure,
many things which one usually considers " necessary "
cannot be bought. They have to be " foregone " for
something still more necessary. The smallest money
expenditure needed for a family's food is found by
multiplying the amount of money needed by one adult
man by the number of adult men in the family. Some
of our families are forced to " forego " some of the food
needed for a bare subsistence. This is always the worst
form of cutting down expenditure, if it can possibly be

44 ECONOMY IN SPENDING

avoided. The idea of economy, making some scarce
article "go as far as possible " in getting your wants
with the least amount of waste is present in many ways
of life. False economy means spending money (or
not spending money), but not getting what you want.

Written work. Do you consider the use of more, or
the use of less machinery would make for a better
" economy " of our work and time at the present

moment ?

ECONOMY IN THE MARKET

CHAPTER 6
THE MAGIC PURSE

IN this chapter we are going to try to understand some-
thing of the meaning of money. To do so, we will go
on a shopping expedition in the market.

Off to Market

Imagine that you live some way away from a village
or town, and that you want to buy enough food to last
you a week. You belong to a family of father, mother
and three children, and, as you are about to buy the
week's food, we will suppose that you are either the
father or the mother. Almost certainly you will be
the mother, but as it is just possible that the father
must come instead, we will call you the " housekeeper."

On page 46 is a list of some of the things you will decide
to buy, their prices, and the amounts of each thing
which you will need to feed your family during the
week. Together with these different things I have put
down the shop at which you will probably get them.

I expect there will be a great many other things you
would like to add to the list ; but I am afraid you have
not very much money, so you must be content with the
food included in the list. On the other hand, this list
is not the smallest amount of food, nor the cheapest
amount of food on which your family could live. It is
just an average or ordinary list of things which a family
might buy.

You must remember that the prices of things are

45

46 ECONOMY IN SPENDING

A WEEK'S FOOD FOR THE FAMILY.

Shop and

Quantity

Money

Goods.

bought.

spent.

Price.

Baker :

Bread and Flour

30 lb.

4/2

i |d. per lb.

Biscuits

I

8d.

8d. ,,

Cake

I

i/-

i/- each

Butcher :

Beef

3lb.

3/~

i/- per lb.

Mutton

3 ..

3/

i/-

Suet

i

8d.

8d.

Sausages

i

1/6

1/6

Dairy :

Eggs

12

1/6

i^d. each

Milk

12 pints

2/6

2|d. per pint

Butter

2lb.

2/~

i/- per lb.

Grocer :

Cheese

lib.

8d.

8d.

Bacon

I M

i/-

i/-

Margarine

i

6d.

6d.

Oatmeal

i

2d.

2d.

Rice

i

3d.

3d.

Tea

i

i/-

i/-

Cocoa

i tin

8d.

8d. tin

Sugar

61b.

i/3

2|d. lb.

Jam

i

i/-

i/-

Greengrocer :

Potatoes

12 lb.

1/6

iid.

Cabbages

3

6d.

2d. each

Oranges

6

6d.

id.

Apples

3lb.

6d.

2d. per lb.

Pot Herbs

2

6d.

3d.

Total spent . . so/-

THE MAGIC PURSE 47

always changing, or fluctuating from day to day ; so,
what is true of the prices of goods now might not be at
all true of prices next month or next year. Perhaps,
when you read this chapter, you will find that the
prices on page 46 are very different from actual ones
in the shops. The total amount of money you will
spend, however, as housekeeper on your family's food for
the week will be exactly 303. in this case.

There are five shopkeepers altogether. At the end
of the day, when you have bought all your things, your
305. will belong to these five shopkeepers.

Shopkeepers and Housekeepers.

If possible, it would be a very good thing if you pro-
ceeded to act the buying and selling of these goods. I
will imagine you can do so in your different classes or
with your friends. Let us suppose that there are 15 of
you. Put aside five of your boys or girls as shopkeepers.
Let each one choose to be the head of one shop.
If there are very many of you, he or she may each
need an assistant. All the rest of the class will be
housekeepers. I shall presume that there are five
shopkeepers and ten housekeepers. Each housekeeper
must have 308. of imitation money, made up of notes,
silver and coppers. No more and no less than 308.
If you cannot get imitation money in your school,
you can make it for yourselves out of paper and pieces
of cardboard cut into round shapes.

When the housekeepers have got their money, they
should make a shopping book, and in it write down a
list of all the things they are to buy, from the list just
given on page 46.

Now the shopkeepers must have enough food for all
the people coming to buy. Again, no more and no less.
He does not want food left on his hands, and he does
not want to lose a chance of selling any. As we have
supposed there to be ten buyers, each shopkeeper

48 ECONOMY IN SPENDING

must have ten times the amount of the quantity of
goods bought in my list. If there are 20 buyers he will
want 20 times the amount of each food. The shop-
keepers can easily make packages to represent these
goods, if they use their imagination during a few
days.

The baker, then, will have ten packages representing
30 Ib. of bread and flour each, ten packages for i Ib. of
biscuits each, and ten cakes. The butcher will have ten
packages of meat, each of which will be 3 Ib. of beef ;
ten packages of mutton, each of which also will be 3 Ib. ;
ten packages of suet, each for I Ib. ; and ten packages of
sausages, each for i Ib. In the same way the dairyman,
the grocer and the greengrocer can prepare the pack-
ages they will need to sell.

Market Day.

On January ist, then, market day will open. Along
come the housekeepers.

With the money in their purses, the housekeepers
will make their purchases. When they have bought
anything, they cross it off the shopping-list, which they
are carrying round with them. They pay the money
over to the shopkeeper, who puts it in a safe place.
Some housekeepers will be faster than others. Some
will chat more than others with their friends. Some
shopkeepers will be smarter in giving their goods
over the counter than others. Some will be quieter
than others, in order not to waste time, because when
there is much noise everything has to be said twice to
them. Some may even be more polite than others,
both as housekeepers, when asking to buy goods, and
also as shopkeepers when selling the goods asked for.

When each housekeeper has got everything on her
list, home she goes, and she counts up all she has spent.
If she has made no mistakes, it must obviously come to
exactly 305.

THE MAGIC PURSE 49

The shopkeepers close their shops, when they have
sold all their goods, and count their money.

All the housekeepers together will have spent 303. X
10 = 3oos. = 15.

All the shopkeepers together will have taken
obviously exactly 15. I shall leave you to find out

IN THE MARKET, FIRST DAY

Some

how much each of the shopkeepers has taken,
will have taken more than others.

If you are acting this with your class or with your
friends, and if there are 20 housekeepers, the total
money spent must be 305. X 20 = 6oos. = 30. It does
not matter how many housekeepers there are. But
whatever their number, the total money spent must
E

5O ECONOMY IN SPENDING

equal the total money taken by the shopkeepers. Also
at the end of the day, all the goods are in the house-
keepers' larders, and all the shops are quite empty. If
you do not find that this is so, you will know that some-
body has made a mistake.

Next Week.

Now, the week goes by, the food is eaten, the shop-
keepers send for more, and on January 8th the house-
keepers set off again for market.

Each one sets off with 305. again in her pocket.
Each shopkeeper orders in exactly the same stock of
goods as before.

But on the way to market, a strange thing happens.
Some old enchantment from ancient days is at work.
Whether it is the work of a good fairy or a bad fairy,
I am not going to say, and a great many people might
hold different opinions on that question. What
happens, however, is that when the housekeepers get
to market, they find that their 305. has turned into
6os.

If you are acting this scene, each housekeeper must
have two purses now, with 305. in each, instead of only
one.

Each shopkeeper, however, has only the same amount
of goods as before, neither more nor less.

The housekeepers are at first so delighted to find that
they have twice as much money as before, that they
quickly dash to the shop counters to buy as many things
as they can. They see visions of large parcels, bulging
larders and piled-up platefuls of food for the coming
week.

Now, if you think a moment, you will see that
the last two columns of money spent in our table on
page 46 are no longer of any use to us, since the
housekeepers have in some miraculous fashion got 6os.
to spend instead of 305., or is. for every 6d. ; or 6d. for

THE MAGIC PURSE 51

every 3d. ; and so on ; and they do not need to worry
now if they spend more than the fixed amount in column
four, page 46, on each kind of goods which they buy.
Instead of our saying how much they must spend, we
will let them buy as much of each kind of goods as they
like, and also spend as much on it as they like.

IN THE MARKET, SECOND DAY

(What is the difference between this picture and the
one on page 49 ?)

" On what shall I spend my extra 305. ? " each one
excitedly asks herself. Perhaps it will be on more
meat for the mid-day meal ; or on more jam for the
children, or on more bacon for breakfast. Whatever
it may be, she will make an attempt to buy more of it
than she bought before.

52 ECONOMY IN SPENDING

Something in their manner will show the shopkeepers
that all the buyers have a good sum of money to spend
more, in fact, than a week ago. What do you think
the shopkeepers will do ? Remember, they only have
a fixed amount of goods to sell.

Let us suppose the grocer sells more bacon to Mrs.
Brown to-day than he did last week. If he had ten
pounds of bacon to start with, he may find Mrs. Brown
has taken 2 lb., and Mrs. Jones 3 Ib. In fact, he has
only 5 lb. left, and he sees eight more customers still
coming to buy bacon, each one of whom had i lb. each
last week.

Perhaps, too, those eight housekeepers will see the
small stock of bacon left on the counter. " Good
gracious ! " they may think, " I mut hurry up and get
my bacon. At this rate, I shall be left without any.
No rashers for breakfast. If that happens, I shall never
hear the last of it from my family ! "

So each one will begin eagerly trying to induce the
shopkeeper to sell some of his bacon to herself, rather
than to the others.

Now if the shopkeeper sees eight housekeepers each
trying to buy i lb. of bacon when he has only 5 lb.
altogether ; and if eight housekeepers are each trying
to buy i lb. of bacon when there are obviously only 5 lb.
left on the counter : what will the housekeepers do to try
and get what they want ?

You must see for yourselves what conclusion you will
come to if you are acting this. Remember the shop-
keeper can't get in more stocks of food till next week.
Remember the housekeeper may spend as much as she
likes on any special article.

What the Extra Money Does.

Will not the result be that the shopkeeper will put up
the price of each pound of bacon to try to stop people
buying too much of his stock (and also to get as much

THE MAGIC PURSE 53

money for his stock as possible). Also the housekeeper
will offer more money than she gave before for a pound of
bacon, to try to tempt the shopkeeper to sell it to herself
and not to anyone else.

In other words, will not the result of the greater
supply of money in the magic purses be to raise the
prices of goods ? And as the day goes by, and the stocks
of shopkeepers run out, and housekeepers get more and
more frightened of being left without bacon, or eggs,
or beef, or jam or something important, will not the
prices of these things rise higher and higher ?

Of course, the shopkeeper must not ask too much, or
the housekeeper will buy something else, and the shop-
keeper will then be left with some of his goods unsold,
which will be bad business.

Do you think, at the end of the day, that the prices
of everything will have risen equally ? or do you think
the prices of some things, which seemed to be sold
out quickly at first, or which housekeepers think are
especially important, will rise to a higher level than
those of other things ?

1 hope, when the housekeepers went shopping, that
they took their shopping lists with them. This week,
I want them to write down both the actual amount of
each kind of goods which they buy, and the total money
which they spend on each of these goods, and also the
prices of these goods.

For instance, if they buy 2 Ib. of bacon at is. 6d. a
lb., and eggs for 2s. 6d., they would write down :

Bought. Total money spent. Price.

12 eggs 2/6 2|d. each

2 lb. bacon 3/- 1/6 per lb.

and so on for everything else that they buy.

Even the most exciting day must end some time ;
even the busiest market must finally close ; and even
the fattest purse must at last be empty.

54 ECONOMY IN SPENDING

At last the sun sets, all the shopkeepers have finally
sold all their goods, or else all the housekeepers have
spent all their money. These two things need not
both happen. The shopkeepers may sell out all their
goods before the housekeepers have spent all their
money. Or the purses may be empty before all the
goods are sold. What does it depend on ? It depends
on how high the prices rise. Think this out for your-
selves.

What the Housekeepers Bought.

Homeward, however, go the housekeepers. Some are
delighted. They think of how much more food their
families will have during the coming week compared
with the past one.

Some are puzzled. In spite of the magic purse, they
are not sure that they have more goods than last week.
They have a different " selection," but until they get
home and can look at it, they are not quite certain
whether it is a better selection than last week's.

And some are sad. In spite of the magic purse, they
have definitely less goods. There will be less for their
family to eat now than last week. How could it have
happened so ? They see that prices were high, they
were slow at buying in the market, and others bought
up the things before their price went up. They shake
their heads in disappointment. Perhaps it was not a
good fairy's work, after all, they think to themselves.

How many of you were glad ? How many were
uncertain ? and how many were sad ?

Over the shops the dusk falls and the lights spring
up as the shopkeepers put up their shutters. They
count their money. Have they, all together, got more
or less or the same amount compared with what they
got the preceding week ? Are they pleased or dis-
satisfied ? I do not think it is difficult to say.

THE MAGIC PURSE 55

Summary. In a market some people buy and others
sell goods. Goods pass from shops to housekeepers,
and money passes from housekeepers to shops. Every-
thing bought and sold has a price. If housekeepers
come to buy goods with more money than before, the
prices of these goods will rise. It will also change the
kind of goods which each person will buy, and the
amounts of goods which each person will buy.

Written work. Write a description of a shopping
expedition in which the housekeepers arrived at their
market, and found that they only had half the usual
amount of money as compared with what they ordin-
arily had. Describe what you would expect to happen
not only to the people but to the prices of things in the
market.

CHAPTER 7
IS IT MONEY WE REALLY WANT ?

At Home again.

During the week after the occasion of the magic
purses, I am afraid a great deal of trouble occurred.
When the housekeepers reached home, they naturally
had to tell their families what had happened, and those
who heard that there would be less for them to eat
for the next seven days were, rather naturally, not at
all pleased. Moreover, they could not understand why
it was that, although there had been twice as much
money to spend, they were actually worse off than
before.

In fact, they showed their displeasure so strongly,
that the housekeepers felt something must be done
about it. So, after a day or two, they called together
a meeting of all the housekeepers who had gone to the
market, to discuss what had occurred.

On a certain afternoon all the housekeepers met
together, and each one brought her shopping list with
her, as I suggested in the last chapter.

If you have been shopping yourselves, one of you
must invite all the other housekeepers to meet you.
Then you must appoint leaders, who shall do exactly
what these housekeepers did.

Each housekeeper wrote down the kind of goods
bought by her ; the prices which she paid ; the total
amount for each goods which she bought ; and lastly
the total amount which she spent in each shop. You

56

IS IT MONEY WE REALLY WANT ? 57

can draw up a list like the one on page 53. They then
added together the total amount of each kind of
goods bought by all the housekeepers ; and the total
amount spent on each kind of goods by all the house-
keepers.

While the housekeepers are doing this, the shop-
keepers should also hold a meeting to discuss their good
fortune. Each is duly delighted at taking so much
more money than in the previous week. There may be
some argument as to which shopkeeper came off best.
So, to settle the dispute, each shopkeeper writes down
the total amount of money taken by him on January
ist, and the total amount taken on January 8th. Then
one of them is chosen to write down the totals for
each shop for the two dates.

Prices again.

After a good deal of discussion, the two meetings
finally draw up their lists. I cannot say what your list
was, as every list would be different. Here is the list,
however, for my housekeepers who went to market, and
we can take this as an example. In the last column you
will see the average price paid for the total of any kind
of goods. This you will get by dividing the total
money spent on bread (say) by the number of Ib. of
bread. So :

5os. -T- 300 Ib. gives 2d. per Ib. = the average price
of bread.

Actually, some housekeepers may give more than the
average, and some housekeepers may give less. Per-
haps one may pay 2|d. or 3d. a Ib. for bread, but others
will only pay i^d. or ifd. so that the average works
out at ad. This is the same as saying that the average
height of 20 boys and girls is four feet, but some may

58 ECONOMY IN SPENDING

be only 3 ft. 6 in., and some may be as much as
4 ft. 6 in.

TEN HOUSEKEEPERS' LISTS OF PURCHASES FOR JANUARY

STH.

Total

Total

Approximate

Shop and

Goods

Money

average price

Goods.

bought.

spent.

paid.

Baker :

Bread

300 Ib.

5<V-

2d. per Ib.

Biscuits . .

10

2O/~

^ 1 >*

Cakes

10

3/~

3/- each

IOO/-

Butcher :

Beef

30 Ib.

6o/-

2/- per Ib.

Mutton . .

30

6o/-

2/~ 99 if

Suet

10

I0/-

I/-

Sausages . .

10

3<V-

3/- ,, ,,

i6o/

Dairyman :

Eggs

I2O

40/-

3}d. each

Milk

120 pints

6o/-

6d. per pint

Butter . .

20 Ib.

40/-

2/- per Ib.

Grocer :

140

Cheese

10 Ib.

9/2

i id. per Ib.

Bacon

10

I4/-

i/4l -

Margarine

10

7/6

9<1. ,, ,,

Oatmeal

10

2/4

2|d.

Rice

10

3/~

3s "

Tea

10

20/-

2/~* >|

Cocoa

10 tins

IO/-

i/- per tin

Sugar

60 Ib.

3<>/-

6d. per Ib.

Jam

10

40/-

4/~ * *t

I36/-

IS IT MONEY WE REALLY WANT ? 59

LISTS OF PURCHASES (CONTINUED)

Total

Total

Approximate

Shop and

Goods

Money

average price

Goods.

bought.

spent.

paid.

Greengrocer :

Potatoes . .

150 Ib.

20/-

i|d. per Ib.

Cabbages

30

IO/-

4<i. each

Oranges . .

60

I2/-

2 x d

ZoU. ,,

Apples

30 Ib.

I2/~

4fd. per Ib.

Pot Herbs

20

IO/-

6d. ,,

TOTAL SPENT AT ALL SHOPS 6oo/~ = 30.

You will not, of course, find that your average prices
are the same as these. Nor will you find the total
amounts spent on any kind of food, nor the total amount
spent in any shop are the same as these. That is
because everyone's wants are different. Also, as I
said in the last chapter, you may find some of your
housekeepers are left with some money in their purses,
although all the goods were sold. Or perhaps the shop-
keepers may have asked too high a price for their goods,
so that although you spent all your money, you could
not buy all the goods. It does not make any difference
to the argument. But I have just chosen the simplest
case where all the money is spent and where all the
goods are sold out.

In spite of the magic purse which doubled their
money, these housekeepers, then, had nothing left in
their purses at the end of the day. You remember
there were ten of them, and each had 305. originally,
which was changed by magic into 3 each. All
together they had had 10 X 3 = 30, all of which had
been spent in the shops.

60 ECONOMY IN SPENDING

The Things they Bought.

Accordingly, they turned their attention to the first
three columns of their list. What had they got for
their magic money ? Money buys things. They had
spent all their money. What had they got ? Here
was the list of the things they had taken home. Some
had been able to buy more than others had, but setting
all the things together, which belonged to lucky and
unlucky buyers, the totals were shown in columns
2 and 3.

Now these totals happened to be exactly the same
totals as those for the goods bought on January ist.
That was the day, you remember, when each house-
keeper only took 305. to market, and when no magic
occurred to change their money <and calculations.
You can prove this by asking the shopkeepers how many
things they sold on that date, and comparing this list
with theirs.

Below you will see their list for January ist, as it
would have compared with the list I have just given
you, on page 58, for January 8th.

TEN HOUSEKEEPERS' LISTS OF PURCHASES FOR

JANUARY IST.

Total Total Approximate

Shop and Goods Money Price

Goods. bought. spent. paid.
Baker :

Bread . . 300 Ib. 41/8 iJld. per Ib.

Biscuits . . 10 6/8 8d.

Cakes . . 10 io/- i/- each

58/4

Butcher :

Beef . . 30 Ib. 3O/~ i/- per Ib.

Mutton .. 30 30)- i/-

Suet . . 10 6/8 8d.

Sausages . . 10 is/- 1/6

81/8

IS IT MONEY WE REALLY WANT ?
LISTS OF PURCHASES (CONTINUED)

Total
Money

6l

Shop and
Goods.

Dairyman :
Eggs
Milk
Butter

Total
Goods

bought. spent.

Approximate
Price
paid.

120

120 pints
20 Ib.

2O/-

6o/-

i|d. each
a|d. per pint
i/- per Ib.

Grocer :

Cheese

10 Ib. 6/8

8d. ,

Bacon

IO I0/-

i/~ ,

Margarine

10 5/-

6d. ,

Oatmeal . .

10 1/8

2u. , ,,

Rice

10 2/6

3d- .

Tea

IO I0/-

I/~" > >f

Cocoa

10 tins 6/8

8d. per tin

Sugar

60 Ib. 12/6

2^d. per Ib.

Jam

10 IO/-

-*/"*"

Greengrocer :
Potatoes . ,
Cabbages
Oranges . ,
Apples
Pot Herbs

651-

150 Ib.

30
60
30 Ib.

20

i5/-
5/-
5/-
5/-
5/-

2d. each
id.
2d. per Ib.
3d.

TOTAL MONEY SPENT

35h
3oo/- =

It took a little time to realise that no more goods,
as a whole, had been bought, because each of the

housekeepers had bought a different amount of goods
from each of the others on January 8th, whereas they
had all bought the same amount as one another on
January ist.

62 ECONOMY IN SPENDING

Better or Worse ?

" I feel very pleased with things/' Mrs. Brown finally
said. " My larder is full of food. In fact, I think I
have nearly twice as much of everything this week
compared with last week. I know I have quite twice
as many eggs and certainly twice as much meat/'

" Well, I am not quite sure, myself, how I stand/'
said Mrs. Smith. " I've got more bacon and more
bread and more vegetables, but I haven't got so much
milk, which is a great nuisance, as the children need it
in this cold weather. Also I haven't so much beef.
When I came to the butcher's, I found he was asking
just on 2S. 6d. a Ib. for it. An iniquitous price ! So,
of course, I couldn't afford to buy very much at that
price. When next Sunday's joint comes on the table,
everybody must have a smaller helping. However,
they can have an extra rasher of bacon with their
breakfasts. Perhaps that will make up for it. I can't
really say how I've done this week. I suppose things
just balance up against one another, and we're about
the same as usual."

" Well, you may be, but I'm certainly not the same
as usual," replied Mrs. Jones. ''I'm definitely worse
off less tea, less milk, less meat and less vegetables.
When I got to market, I went to see my married sister
to tell her about our great luck with these magic
purses. We stayed chatting all the morning together,
and in the afternoon, when I got to the shops, what
did I find ? The price of everything was so high that
my magic money could hardly buy anything. What was
the use of buying a great lot of oatmeal and rice, when
I couldn't get a proper joint of meat and a proper cut
of bacon ? Rice pudding and porridge for the week is
not very popular with my family, I can tell you ! "
So the discussion went on.

Finally, one of the housekeepers, who had hitherto
spoken very little, stood up.

IS IT MONEY WE REALLY WANT ? 63

Or . . . Just the Same ?

" The fact of the matter, as I see it, is this," she said.
" Some of us are better off, and some are worse off,
and some are about the same. But taken all together,
we are just exactly the same as we were last week, because,

NLY
RICE

LEFT*

THE LATECOMER

if we put all our food together on the table, we haven't
bought any more or any less from the shops, than we
usually do. I can't see that this magic money has done
us any good. It's only upset things, so that we don't
know where we are."

" That's very true," said Mrs. Brown, who had spoken
first, " and on second thoughts I'm not so sure I'm
even so very pleased myself. You see, my folk at home
are very pleased with things just now, but what will
they say, if the magic money does not come along next
Saturday, and I only bring home the same amount
that I did in ordinary times. I shall hear some
grumbling, then, I'm afraid. They'll think because
I've done it once, I can always do it ! Besides, even if
the magic does happen, I may be late in the market

64 ECONOMY IN SPENDING

that day, or you may be quicker than I, and then I shall
be as badly off as Mrs. Jones is this week."
" What shall we do about it, then ? "

Was it worth it ?

" Well," said the quiet housekeeper, " my plan is
that we don't use this magic money. Suppose that it
did happen again. If we all agree not to touch it, we
shall go back to the old ways, which did please everyone
fairly and equally on the whole, although there wasn't
such a very great deal for everyone."

" Well, we certainly did know pretty well what we
were going to get, and we could make plans for the
week."

" This week is all topsy-turvy. I couldn't get any
cheese, so I have to give my family porridge for supper
instead, and that means more cooking in the evening,
when I've got a lot of other things to do. I agree.
Let's decide not to use this money."

" And so that we shall all do the same thing, and
none be better off than the rest, if we get the magic
money, we'll make a big heap of it, and throw it in the
river ! "

" That does seem rather funny, though," said Mrs.
Robinson. " It can't be very economical to throw
away good money like that. It sounds very wasteful
to me."

" I think that depends on what we really want,"
replied the quiet one. " It isn't money at all that
matters in the end, is it ? We can't do anything with
the money, unless we spend it or save it. If we save
it up for a rainy day, the same thing will happen in the
end, when a rainy day comes and we do spend it, as
has happened to us this week. If we spend the money
now, then all these troubles crop up, and taken all
together, we aren't better off in the goods we buy as
we agreed just now. I think the proper economy is to

IS IT MONEY WE REALLY WANT ? 65

try to get what we really want, with as little waste as
possible ; and as we want the old certain ways of living,
and as the magic money doesn't bring more goods for
us all, in any case, I say we must not use this strange
and magic money."

So, after a good deal more argument, the meeting
finally decided that that was the best thing to do.
Things had not turned out so well as they had hoped.
It was certainly very disappointing, after thinking they
were so much better off, but they felt that it was better
than having all the trouble which the magic purses had
brought with them. Do you think they were right ?

Summary. Although everybody's money together
may increase, it will not buy more goods as a whole,
if the amount of goods does not increase, too. The
prices of goods rise. Some people will be able to buy
more goods, perhaps, but others will then get less than
before. This makes people's lives uncertain and
difficult, because it is goods, not money, which really
satisfy wants in the end. Goods, not money, are what
finally give people real wealth. To refuse increased
quantities of money may be good " economy," if people
all together are considered, because their wants are
more easily satisfied if the increase is refused by all.

Written work. There is an old story of a King called
Midas, who turned everything that he touched into
gold. Write an imaginary account of a day in your
life when everything that you touched turned into
paper i notes. Can you draw any conclusion from
your story about what being " well-off " means ?

CHAPTER 8
WHERE DO GOODS COME FROM ?

Back in the Shops.

In the last chapter, we left the shopkeepers making
a list of the amounts of money which each had taken
over his counter, on January 8th, as compared with
January ist. When they had finished making their
lists, their result was something like this :

Total money Total money
taken on taken on
Shop. Jan. ist. Jan. 8th. Increase.
Baker . . 58/4 ioo/- Nearly twice.
Butcher . . 81/8 i6o/-
Dairyman 6o/- *4/- Nearly 2.\ times
Grocer . . 65 /- 136 /- About twice
Greengrocer 35/- 64/-

T\-k4-/jl TY1^MK^X7

taken . . 15

3 J us t twice

If you look at the figures, you will see that they have
all done very well for themselves. Four of them have
practically doubled their money receipts on the week.

One of them, the Dairyman, has taken nearly 2\
times as much money compared with the earlier week.
Naturally he was the most pleased of all.

" This is pretty good," said he. " Nearly 2\ times
as much money for just the same goods. I must think
what I had better do next."

When he got home, however, he was not quite so
pleased with everything, because he found that his

66

WHERE DO GOODS COME FROM ? 67

wife had been to market with the other housekeepers,
and that she had been one of the slow shoppers, who
had found the price of everything so high that she had
not been able to buy her Sunday joint. The Dairyman
was rather annoyed at this. However, he soon cheered
up.

" I tell you what I'll do," said he to his man. " I'll
buy another cow. With the price of milk as high as
it is just on 6d. a pint (see page 58) I shall soon make
my fortune, and then my wife can buy all she wants,
whatever the prices are ! "

How the Extra Money upset things . . .

So, on Monday, off he went, and bought a fine cow,
for which he paid a lot of money.

However, in the middle of the week, you remember,
the housekeepers met and decided that it would be
much better for them all not to use the magic money.
When they came to market on Saturday, January I5th,
each one only brought the 305., which they had had on
January ist. The result was that they could only spend
the old sum of 2s. 6d. each on milk (see page 61). So,
although the Dairyman had more milk to sell, the house-
keepers could not buy it. The result was that he had
to lower his price very much to about id. a pint to sell
part of it, and even then he had some left on his hands.

" It doesn't seem to me the new cow is much use to
me," he thought that evening. So next Monday, he
sold it back to the man from whom he had bought it.
He did not get quite as much as he had given for it,
as the farmer who sold it to him said that he ought to
know his own mind, and that it was a lot of bother for
nothing.

Luckily, not very much harm was done, as in this
case there was only one cow. If there had been 100
or i ,000 or 10,000 dairymen, all of the same opinion
as our dairyman, and all of them suddenly buying cows,

68 ECONOMY IN SPENDING

you may see that their losses on selling them again
might have been very great.

. . . and still more things.

Not only would their losses have been very great,
but also the losses and trouble and general uncertainty
of the farmers from whom they bought their cows.
Faced with the sudden demand for cows, the farmers
might have decided that it was worth while trying to
rear more of them. Many of them, therefore, might
have ordered materials with which to build barns, straw
and hay for bedding and fodder, or bought roots and
cake for winter food. They might even have rented
an extra piece of pasture.

When the time came when the dairymen saw that
they could not sell their milk at a price which made it
worth their while, they would stop buying cows, and
they would want to sell them, just as our man did.
Then the farmers would stop buying roots and cake
and straw and sheds. This would mean that all the
hay merchants and cake merchants and root-growing
farmers would find that their plans were all unnecessary,
and that nobody wanted the extra cake or roots or
fodder which they had been getting together.

In this way, a great deal of wasted time and wasted
effort might have occurred. All of it in the first place
was caused by the magic money which had suddenly
and mysteriously come into being ; money, you remem-
ber, which was of no use to people, except to buy goods,
and which, when spent on goods, upset not only the
calculations people had all made for buying, but also
the calculations others had all made for selling, and
for producing the goods which they intended to sell.

What would have happened if the housekeepers had
spent the magic money ? Would the dairymen and
the farmers have been upset then ? Perhaps somebody
might have asked this question.

WHERE BO GOODS COME FROM ? 69

There are two possible answers to this.

In the first place, we can imagine that, although all
the prices of everything rise, as we saw they did, the
shopkeepers do not order in more goods. Then the
result would be that, although each housekeeper had
more money on January I5th, she could only buy the
same amount of goods with it as she bought on January
ist ; then, although she might get more goods, others
would get less ; so that all together they would be
neither better off nor worse off, as we have already seen
on January 8th.

How can the Shops get more Goods ?

In the second place we can imagine that, as the
prices of everything rise, the shopkeepers do order in
more of everything. Would not everyone be better
off in that case ? Everyone would have more money,
but there would also be more goods to buy with that
money.

To understand what would eventually happen in this
case requires rather a long answer, and most of it must
be left to the next chapter and also to Part B
Economy in Production.

For the moment, however, you must ask yourself
" Where do goods come from ? "

It is quite true that the shopkeeper may order more
goods to come to his little market or village or town.
To whom does he send ? If he is a greengrocer, he
will probably send to a large wholesale merchant. If he
lives near London, these merchants mostly sell their
vegetables to the shopkeepers from a place called
Covent Garden. If you walk round there at any time,
you will see large boxes of oranges and apples, bananas,
cabbages and carrots.

Now obviously this wholesale merchant does not grow
all these things in London ! From whom and from
where does he get them in his turn ? For the most

70 ECONOMY IN SPENDING

part, the wholesale merchant buys his fruits and
vegetables from farmers at home, or from big shipping
companies or from other merchants, who import (buy)
the goods from farmers in foreign lands. Sometimes
these farmers are called planters, but they are just like
farmers, in that they are the men who see to the actual
growing of the foodstuffs.

So, in the long run there is a chain of production
which runs from field and farmer to our housekeepers'
larders. In many cases it is something like this :

pig

{

Danish pig farmer

I
Danish Co-operative Society

I.
English importing merchant

;

English wholesale firm

I
English shopkeeper

I
English larder

I
English breakfast-table.

The commodity may be pigs turning into bacon on
our plates ; or raw cotton turning into shirts on our
backs ; or coal turning into heat in our grates.

These first goods from which are made all the goods
we buy in shops are called Raw Materials, or Primary
Products ; and they exist at the very beginning of
each separate Chain of Production.

Now to come back to our magic money. If all people
in all markets had more money together, the prices of
shopkeepers' goods would rise ; the shopkeepers order

FROM PIG TO BACON

72 ECONOMY IN SPENDING

more goods from the wholesale merchants ; their prices
rise ; the wholesale merchants order more from the
importers ; their prices rise ; the importers order more
from the first producers, and their prices rise.

What, then, has been the effect of the magic money ?
Is it not very much the same for the sellers of goods as
it was for the housekeepers who bought the goods ?

All our shopkeepers and all other shopkeepers in
every other market in the land are trying to buy goods
from all the different people in the Chain of Production.
The high prices are passed on to the very end of the
chain. So that no special market, unless it were very
clever, might get any more goods with its money, because
prices have all risen. Also no special merchant gets
more money for his goods, because the merchant from
whom he first bought those goods has also raised his
prices.

Somebody makes them.

And what do we find at the end of the chain ? We
usually find some raw material or primary produce
which exists in the land. These extra goods which we
want to buy, in order that we shall be " better off,"
often come from other goods which have to be made or
produced by farmers or miners or cotton growers, or
by some class of individual working on or in the land.
They may, however, be made by people in factories, or
in offices, or in hospitals, or in their own homes, though
the things which they use come mostly from the land.
How are these people, in their turn, going to produce
more of these extra goods ? I must leave the answer
to this question to the next chapter.

Summary. Increases in money, leading to increases
of prices, lead to increases in orders of shopkeepers.
If the increase in money is withdrawn, then the new
goods produced cannot be bought, and the shopkeepers

WHERE DO GOODS COME FROM ? 73

and producers have wasted time and money and labour.
If the increase in money continues, sellers of goods will
order more foods from other sellers, and these orders
are passed right back along a long chain of production,
until they reach some first producers. Each seller of
goods, along the chain, however, raises the price of the
goods which he sells, because there is more money
being offered for his goods. We cannot yet see in what
way more goods, as a whole, will be forthcoming.

Written work. Either : i. Make a Chain of Pro-
duction in a similar manner to the table on page 70
for any three of the following commodities : Butter
shoes chairs books chocolate .

Or : 2. Make a pictorial Chain of Production for
any one of the same goods, in a similar manner to the
picture on page 71.

Or : 3. Consider carefully whether you would be
better off if, supposing everyone in the world used gold
for money :

(a) You discovered a gold-mine in your back

garden.

(b) Everyone in England discovered gold-mines in

their back gardens.

(c) Everyone in the world discovered gold-mines

in their back gardens.

CHAPTER 9

WHERE TO LOOK FOR THE REAL ALADDIN'S

LAMP

Summing it up.

Let us just consider for a moment where we have
got to and what conclusions we have reached.

In our discussion of the market, and the effects of
having suddenly twice as much money to spend as usual,
we can put these conclusions into two groups :

GROUP A. MONEY AND GOODS.

1. That because we have many different wants, we
should think out carefully at all times what we really
want most, and that we should then try to get it with as
little expenditure as possible : that is, we should econ-
omise in the means we have of satisfying our different
wants.

2. That a sudden increase of money upsets the plans
of people trying to buy goods with which to satisfy
their wants.

3. That the sudden increase of money was no help
to all the people considered together in the market,
because there were no more goods to buy. Therefore
prices rose.

4. That it is goods, therefore, which are required
with the money, either at once by spending the money
now, or later if the money be saved now.

5. That it is goods not money which will, in the long
run, make all people " better " or " worse off."

74

THE REAL ALADDIN'S LAMP 75

GROUP B. MONEY AND PRODUCTION.

6. That a sudden increase of money in our market
only would increase the profits of the shopkeepers
(these are called retailers), who would then try to order
more goods.

7. That if the sudden increase of money for any
reason stops, all the plans of the shopkeepers and of
the people from whom they buy goods are upset, and
a great deal of loss and confusion occurs along the
Chain of Production.

8. That if the increased money continues to be
spent in the market each week, the shopkeepers order
more goods, and people in our market will be better off.

9. But although people in our special market would
be better off, because there would be then more goods
in our special market, nobody need be better off if all
markets together had more money, since the prices of
all goods along the Chain of Production would go up.
Accordingly the greater amount of money for all and
each market would only buy the same old amount of
goods as before.

10. That to get more goods for everyone, so that
everyone will be better off, means that they must be
produced or made by someone. How this last difficulty
is to be overcome is the problem we must now consider.
All we can see at present is that the extra money alone
is " no use," if we think of everyone together.

More Goods . . .

To tackle the question of how goods can be increased,
we must first notice two special points.

. . . and Services.

The first is that we can spend our money not only
on goods, which we can touch, but also on those which
we cannot touch. I will suggest one of this group

76 ECONOMY IN SPENDING

omnibus rides. You cannot touch a 2d. bus ride. Of
course you can touch the bus, but you do not buy
the bus for 2d. You only buy a ride for a mile or
two in it. This sort of thing, which you buy, is called
a service. Think of as many services as you can. Give
yourself three minutes in which to make a list of them,
and then compare your list with those of your friends.

You can produce or make services just as you can
the pigs or raw cotton, or coal, or other raw materials
which, we saw, lie at the beginning of most of the
things which we buy. If more men train to become bus
conductors and bus drivers, we are helping to produce
more bus services.

The Flow of Production.

The second point is that the production of these
goods and services is always going on all the time. It
never stops. Production is a continuous process.

Every day some men are building ships. Some men
are digging in the fields. Some women are cooking
food. Some women are spinning cotton. Every night
some men are driving railway trains. Some men are
printing newspapers. Some women are singing at
concerts. Some women are nursing the sick.

This production of goods and services goes on day
by day, week by week and year by year. It is like a
great river. Instead of water flowing by us, we see
ships, wheat, cooked meals, yarn, railway trains, news-
papers, songs, trained care and attention.

Your money is like a bucket. It gives you the power
to draw out some of the things you require from that
great river of production. Your money does not give
you the river in the first place. That is why I have
tried to impress on you the difference between your
few housekeepers having more money in one market
only ; and everyone having more money in all markets.

If only you or a few of you have more money (bigger

RIVER OF PRODUCTION-/*

THE CONTINUOUS FLOW OF GOODS AND SERVICES

78 ECONOMY IN SPENDING

buckets), you can draw up more goods and services
out of the river of production, and there is then just a
little less left for all other people. But if everybody
has more money (bigger buckets) you cannot all of you
together get any more goods and services than there
were in the river to start with. This is obvious, because
rivers will flow at the same rate whatever the size of
the buckets which may be used to draw water from
them.

Swelling the River.

To be " better off " in the sense of having more
goods and services meant, we saw just now, that more
of these goods and services must be " produced " by
someone. In other words, we must .think of the river
of production becoming wider or deeper or flowing more
fast.

To say that we have more goods and services means
not so much that we have ten eggs instead of five eggs,
but that we have ten eggs a week instead of five eggs
a week ; or two coats a year instead of one coat a year.
It can mean, however, that we have one heavier coat,
instead of one lighter coat each year ; or one beautiful
dress, instead of one ugly dress each year ; or motor-
bicycle rides instead of push-bicycle rides each month ;
or four weeks' holidays instead of two weeks' holidays
each year. At the same time, of course, everything else
we were accustomed to having remains as good as
before. That is what we mean when we say " other
things equal." Obviously, we may not be any better
off by having two eggs instead of one egg for breakfast,
if we have to go without our bacon. In that case
" other things " would not be equal, and we might be
really worse off, if we preferred bacon to eggs.

Now, when we say that the river of production needs
to become wider or deeper or to flow more fast, we mean
that the quantity or quality of goods and services

THE REAL ALADDIN *S LAMP 79

produced must be increased, or improved, or that a
different kind of goods must be made, which will please
us better than the old kind.

We usually think that production is greater to-day
than it was 100 years ago, because we have things and
services now which never existed at all in those days.
Wireless is one, and good drainage is another. How
many more can you suggest ? On the other hand,
there are some things which our great grandfathers
had, which now we do not have. One was riding in
coaches, which, although slower and much more uncom-
fortable than riding in trains, was more interesting and
more exciting. In this way it is not at all easy to say
how much production has increased or improved in the
past 100 years.

How is it done ?

// we want to make the river of production larger,
i.e., to increase the flow of goods and services, how can it
be done ? If we can find out the answer to this, we shall
discover something very much more important than
finding how to double the amount of money, that is,
the number of paper i notes which ordinarily exists
in the country.

Any bank or government can do this just by printing
more of them. You should by now realise that this
need have no effect at all on giving people more goods
and services, and that it is likely to have the reverse
effect by upsetting consumers' wants and producers'
orders.

Ordinary rivers are increased in size or rapidity by
rains which fall from the heavens above. Our river of
production only depends upon the rains of heaven in a
small degree. For if the seasons are kindly, if the sun
shines brightly when it is most needed ; if the snows
melt at the right moment ; or if the winds blow
strongly in winter or warmly in spring, seed sown

8O ECONOMY IN SPENDING

will spring up more strongly and the harvest in summer
will be greater than otherwise. But apart from this
kind of consideration, the river of production depends
upon the efforts, the bodies and the minds and good sense
of those people who help to feed it. Those people are
all those who produce in some fashion the goods and
services of which the river is formed.

How shall these people best assist in increasing the
output of goods and services ?

If we can discover this, we shall have found the real
Aladdin's Lamp.

Unfortunately, or perhaps more truly, fortunately,
we cannot pick up an Aladdin's Lamp anywhere with-
out looking for it. Moreover, it is quite a long search
that is needed. It will take us the* whole of our next
section : Economy in Production.

Summary. If we need to be " better off " in goods,
i.e., to have more or better goods, these more or better
goods must be produced. Production is a continuous
process. Money does not produce things. It only helps
you to get what you or somebody else has produced.
To understand how production can be increased, we
must consider the next section : Economy in Production.

Written work. Either : i. Make a River of Pro-
duction suitable for :

(a) Life in Ancient Britain.

(b) Life in the time of Queen Elizabeth.

Or : 2. What inventions in the last 50 years have
greatly altered the goods or services to be found in the
River of Production ?

PART II
ECONOMY IN PRODUCTION

SHIPWRECKED ON THE ISLAND

ROBINSON CRUSOE ON HIS ISLAND

CHAPTER 10
A DAY ON A DESERT ISLAND

Shipwrecked.

Have you ever thought what you would do, if you
were wrecked on a desert island ? I expect nearly
everybody would say " Yes/' I think, however, it
would be nearer the truth if everybody said " No."

That sounds rather surprising. Most of you will say
at once : " But we've read Robinson Crusoe, or the
Swiss Family Robinson ; " or else you will say : " What
about those stories of bold, bad pirates with their
treasure hidden on an unknown island in the Pacific ?
Haven't we all read those ? Don't we know exactly
what we should do in their place ? "

That is all very well. But that is reading about
what other people did on these islands. It is not
thinking out for yourself what you would do. Besides,
in the case of the Swiss Family Robinson, the story
never played quite fair, because, if ever they wanted
some extra tool or implement, they were always able
to return to the ship, which was conveniently nearby,
and which had nearly everything they wanted on it.
In the case of the pirates, when you come to think of it,
they seldom actually lived on the island. They gener-
ally jumped out of their boat, dashed up to the third
palm tree N.N.E. of the long lagoon, stuck their spades
into the ground, and were routed by the hero, just in
the nick of time, who then proceeded to march the
survivors straightway on to his own boat, where they
were put in chains. So they did not have much chance
to make any great plans for living on the island.

83

84 ECONOMY IN PRODUCTION

So what would you do ?

If you began to think more carefully about it, you
would, perhaps, ask me a few questions first. For
instance, has the ship gone down or is it moored on the
beach ? How much is the island really desert ? Is
there water ? Are there stones and rocks ? Are there
trees ? Is there any fruit ? Is it hot or cold ? Well,
I am afraid I cannot answer them all properly, I will
say, however, that the ship has sunk. You really are
shipwrecked. The island is not a real desert. It is
rather a pleasant island, at least ten miles long and five
wide just how pleasant, you can decide for yourselves.
You have on you the clothes you stand up in, and
perhaps a good big jack-knife, but that's about all.
Also you are the only survivor.

Now what would you do ?

It is Monday morning at eight o'clock. The sun has
been up two hours. It is warm, with a gentle breeze
blowing. You wake up under a shady tree from a deep
sleep into which you fell on being washed ashore last
night.

Think it out.

It would be a good thing for you to take at least a
quarter of an hour to think what you would do during
the first week or month. Or, you can discuss the matter
with your class, and one of you can make a list of all
the things which the majority of you decide to be the
best. Or, you can all write a description of your
first week as a shipwrecked sailor. In any case, think
it out for yourself before you proceed to read any
farther.

What you will now read is an account of how one girl
of 12 years old decided she would spend her days. I
will confess I had already had some talks in class with
her on the problem. You will see this from her last

A DAY ON A DESERT ISLAND 85

remark ; but all the details are entirely her own
invention.

" HOW I WOULD SPEND A DAY ON A DESERT ISLAND/'

" / have just been wrecked on a desert island out in the
Pacific, unluckily miles from anywhere. My ship, the
' Seagull,' had been in a very bad squall, and had been
driven on to some hidden rocks near to the island, and
I had been the only survivor of the wreck. I had a
few provisions, enough to last about two days.

<f This island is only about five miles square, being a
desolate waste of sand dunes with a few palm trees
which bear coconuts and a few banana trees. As soon
as I reached the beach, I went in search of water.

" After I had discovered a small spring of water, I
explored, and on the way I gathered some bananas and
coconuts, and went back to my provisions. On the
way back I discovered a very sheltered hollow in the
dunes which was sheltered from the winds. I then
moved my provisions into this hollow.

" My next move was to build a hut ; so, with the aid of
my knife, I made a chopper out of wood and managed
to collect some wood with which I made a hut, which
would at least last for about a month or two. Then I
kindled a fire. I made the flame by two flint stones,
which I had found on my exploration. With the wood
I obtained, I made a raft, and a fishing line with some
wood and string I had in my pocket. My supply
of food would last a long time, for I could get plenty of
fish.

" Every day I kept a constant look-out for passing
ships, and I hoisted my shirt to the top of one of the
palm trees. Many weary days followed. The only
amusement I could find was drawing pictures or writing
in my diary on the sand.

" After about two months, when my stores were getting

86 ECONOMY IN PRODUCTION

low, and winter was approaching, one day at sunset, I
sighted a big sailing yacht. As quick as lightning, I
scaled one of the palm trees, and signalled with all my
might. I was seen, and I was rescued.

" And many days afterwards I printed a book on the
best way to economise in time on a desert island."

I think most of you will agree that our shipwrecked
sailor was a very sensible fellow. He kept his head.
He made the best of a bad job. He thought out whui
he wanted, and he didn't waste time.

Time on the Island.

He didn't waste time.

There is nothing very extraordinary in that sentence,
is there ? Wasting time. I think most of us have
heard this phrase a good many times. Sometimes we
say it to ourselves, and sometimes other people are kind
enough to say it to us. / suppose it means that we
are using our time to do some things which are not so
important as other things which we might be doing.

As our sailor was on a desert island, he could not
waste money. He had not got any to waste, and even
if he had, it would not have been any use to him, would
it ? But if you think a moment, when we talk
of wasting money, we mean that we are using our
money to buy some things which are not so important,
or so desirable, to us, as other things which we might
buy instead.

Is not wasting time exactly the same idea as wasting
money ? Some people say Time is Money. But that
is using words in a very limited and shallow manner.
Time is a great deal more than money. When people
say Time is Money, they mean that if you use as much
of your time as possible to make money, you are likely
eventually to become a rich man or woman. That is
probably true, if you use enough of your time.

iS ONLY 20 SHILLINGS WITH WHICH TOBUY

MONEY

A DAY is ONLV 24nouRs INWHICHTO

. . . AND TIME

88 ECONOMY IN PRODUCTION

Time can be used for vastly more, and sometimes
vastly more important things, than making money ;
important though making money may be.

There is a sense, however, in which it would be true
to say that Time is like Money. Do you remember
how in Chapter I, a benevolent genie was summoned
to give you anything you wanted ? You made a list
of all the things for which you would ask. That was
very nearly the same as having unlimited money, a
bottomless purse. (Not quite the same, because money
can't buy health or wisdom or a good temper.) Another
genie might be called up who might give you the power
to do anything you wanted. What would you do ?
Sail round the world ? Build a palace ? Practise to
become a cricketer to play in the Test Matches ?
Study your favourite subject in all the Universities of
Europe ? Become a great actor ? Write a poem ?
Irrigate the Sahara ? Swim the Channel ? Explore
Central Asia ? You could choose each in turn, one
after another. The genie would give you your chance.

After deciding in Chapter I on all the things you
would have, you were " rationed " to only a few things.
You had to choose between the things you wanted
most and the things you wanted less urgently. That
was the same as having a limited amount of money to
spend. Your money was not everlasting, but to some
degree it was scarce. That is the condition with regard
to money in which people actually live in this world.

Scarce Time.

Now that is exactly the same condition with regard
to Time, in which people actually live in this world.
To some degree Time is scarce. Nobody can do all the
things he or she may wish to do, because there is not
enough time. Our genie could only give us the chance
to do all we wanted in a fairy story in which " we lived
happily ever afterwards." As we cannot live happily

A DAY ON A DESERT ISLAND 89

forever afterwards, our Time is, as it were, rationed for
us. So we have to choose between doing those things
which we want to do most urgently and doing those
things which we want to do less urgently. We cannot
do all the things we may want, just as we cannot buy
all the things we may want.

In this sense, then, Time is like Money. They are
both to some degree scarce. That is why it is possible
to talk of wasting time. If we had unlimited time, we
could not waste it.

Time and Wants.

Our shipwrecked sailor had had a good deal of experi-
ence in this problem on the desert island. He dis-
covered that he had a great many wants. As there
was no one to help him, he had to satisfy those wants
himself by his own energy and activities, by the skill
of his hands and by the sweat of his brow. He soon
found that if he gave up too much of any of his days to
any special job like making a raft, the sun went down
on his labours, and he discovered that he had no food
for supper. He had used up all his scarce day on one
job, and then he found that his stomach was so empty,
that he would have been wiser to have spent less of his
time on the raft, which could well have waited a day
or two longer, and more of his time on getting food for
supper, which could hardly wait at all. By breakfast
next day, his need for food was so great, that he quite
decided that he must ask himself carefully what were
his most pressing wants, before deciding how to spend
his scarce time each day.

That is why the shipwrecked sailor in the story which
you have just read wrote a book, when he got home, on
how to economise time.

Summary. Time is very similar, on a desert island,
to money in our present surroundings. Time is scarce

90 ECONOMY IN PRODUCTION

just as money is scarce. Proper economy should not
waste time in doing things which do not give you what
you most want, as much as doing other things which
do give you what you most want. On a desert island,
you can only have the greater part of your wants
satisfied by doing jobs that will satisfy those wants.
You can't buy things. We can call this producing
things for ourselves. So we can think of economy in
production. This requires thoughtful planning ahead.

Written work. Make a list of as many as possible
of the different ways in which you spend the time of a
24-hour day, from midnight one day to midnight the
next day. Then arrange the different ways in which
you spend the time, in order of importance, i.e., put
those ways of spending the time at the top which seem
to you to be most important, and which you could
least well do without.

CHAPTER n
THINKING IT OUT

IN the last chapter, we saw that our shipwrecked
mariner decided that the best thing to do, first thing
in the morning every day, was to think out carefully
how to spend his time. (Has it struck you that that is
another phrase in which time and money are compared
in a like manner ? You " spend time " and you
" spend money ".)

In fact, every morning you can think of our sailor as
Robinson Crusoe standing under a palm tree with a
ring of question marks round his head.

What do we want ?

Each of these different question marks would repre-
sent something different on which he might spend his
time. In the last chapter, we saw that there were a
great many things which he would obviously want to
do. As there were so few things provided by Nature
on our desert island, he would have to make nearly
everything he wanted for himself. As most of you will
already have realised, he must build his own canoe,
pick his own bananas and coconuts, catch his fish, make
his tools, light a fire, build his hut, look for water, as
well as a great many other things.

As Crusoe has no store or ship from which he can
take the things which he requires, we see then that
everything must be provided by his own work or labour.

9*

Q2 ECONOMY IN PRODUCTION

Even the coconuts cost him some labour, because, until
he has picked them oft the trees, they are no use to him
for eating.

Having things and Doing things.

We can see then that there is some connection
between making a list of the things we want to have,
and making a list of the things we want to do. Because,
if we want coconuts, we shall want to climb up the
trees to pick them. If we want a hut to sleep in, we
shall want to spend some of our time building one. I
do not say that we shall necessarily give any of our time
to do those things. We shall only do those things like
picking coconuts or building huts if we want the
coconuts or the hut enough.

Some of Robinson Crusoe's day then will be spent in
providing the things he wants to have by working in
some way to get them.

Spending our Day.

Out of 24 hours, however, he will not spend the whole
time in work. Too little work is a mistake, but too
much work is just as bad. If you have been really
honest in thinking out what you would like to do as a
shipwrecked mariner (see page 84) you may have
included in your list one or more of these pastimes :

Swimming in the lagoon (or in the sea).

Sun bathing.

Sleep.

Running about for exercise to keep fit.

Exploring the island.

Sitting about.

Some of you may think these are good ways, and some
of you may think these are bad ways of spending your

THINKING IT OUT 93

time. But, whichever they are, they certainly are
different kinds of ways of spending your time.

I do not think you can really call any of these ways
work or labour, unless perhaps exploring is such. It
is rather difficult to say exactly whether or not explor-
ing is labour. It rather depends on your motive, or
your intention in exploring. If you are doing so
just to amuse yourself, as you might spend a pleasant
day in the country walking in the woods to see what
they are like, you would not say exploring was work.
But if you were trying to find some stones on your sandy
island with which to make a flint axe, I should say it was
very much like work. Or if you went searching round
partly to see if there were any flints, and partly because
you were tired of sitting about and doing nothing, then
exploring would be both work and amusement at the
same time.

Work and Play the same and . . .

Most things that we do are a mixture both of work
and of amusement. There is really no hard-and-fast
line between the two activities. There is very little
" work " which is not enjoyable to some person,
although we all have enormously different tastes. I
may like planting cabbages and you may hate it, and
you may like selling cheeses and I may hate doing so.
Whatever we do, we usually enjoy it, at least for a
while. In other words, we get more amusement out
of doing some work than out of doing no work at all.
In fact, it is far " harder " to do no work all day and
every day, than to do some work. You have only to
think how sad and wretched are the lives of unemployed
men and women. This is not only because they have
so little money to spend, but very largely also because
they have so much time to spend, but have so few
ways in which to spend it.

94 ECONOMY IN PRODUCTION

Work and amusement then are and should be, quite
rightly, mixed up together. The more people work on
jobs which they enjoy, the happier everyone will
be.

In what way can we separate work and amusement ?
Is there any purpose in keeping these activities apart ?

Work and Play different.

There is one very definite difference to be seen.
When we work, we work partly with some other pur-
pose in view than the mere joy of working. As we go on
working, the fun of working grows less, because we
gradually get (more) tired or (more) bored ; but the
other purpose remains as fixed in our minds as ever
it was.

I may be a coal miner. If I am a good skilled man,
I may enjoy using my muscles in the best and most
efficient way. But I also dig the coal partly to get
coal to heat the house and cook the food, or partly to
earn a wage to buy the food and pay the rent. If I am
a typist, I type letters, partly to send news needed
for my business and partly to earn money as the coal
miner does.

If I dance on the village green, however, I dance
for joy ; I dance for dancing's sake (unless I am a
dancer by profession and am giving a " show "). I am
amusing myself without any other purpose in view. If
I swim in the sea or the river, I do it only because I
like swimming. If I play tennis or golf or football
or hockey, I do it for the fun of the thing, unless
I am a professional, in which case it would be
" work."

Robinson Crusoe, then, can either work or he can
play, i.e., amuse himself on his island.

If he sleeps, he does so because he likes it or because
he must. If he sits and dreams, he does it because he

THINKING IT OUT 95

likes it. If he swims for pleasure, he can do it because
it is enjoyable and for no further reason. Or he can
spend his time eating the fish he caught or the coconuts
he picked. In that case, he is doing so just because he
is hungry and eating pleases him. In all these ways he
is spending his time and getting nothing in return for
it beyond the sheer fun of it.

Scarce Time again.

If Crusoe builds himself a hut or collects his bananas,
or makes a hammer, he is spending his time and getting
something in return for it other than the fun of doing
it. He is giving up his time doing the jobs which
help him to get those things which he wanted to
have.

It is best to call the first group of activities those
that are done for the fun of it only spending or leisure
or consuming ; and the second group of activities, work-
ing or producing. In between these two groups come
those done with mixed motives, like exploring or
exercising.

Robinson Crusoe, then, must choose broadly between
how much of his time he will give up to pure enjoyment,
in spending pure and simple, or in consuming ; and
how much time he will give up to work or labour or
producing things.

Also he must choose between the forms of enjoyment
on which he will give up his spending- or leisure-
time ; and between the kind of things on making which
he will give up his working- or producing-time.

The Choice.

At the beginning of this chapter, we said that Robin-
son must think things out carefully every morning.
Here is a picture of him after a little thought, showing

ECONOMY IN PRODUCTION

9 6

what are the different possibilities between which he
must choose in deciding how to spend his day :

Sleeping ?

Swimming ?

Si ttiog in
Sun?

Axe
or Specie.?
,Ge(rlring
COCOA
or w<xter?

AXcxKing
Sl'ore i.e.

HOW CRUSOE SPENDS HIS DAY

There is no special order in which I have put these
different ways of spending his time. Robinson Crusoe
himself felt they were all muddled up too much, so he
finally sorted them out in his mind, rather in the
fashion in the next diagram :

THINKING IT OUT 97

SPENDING OF CONSUMING OF LEISURE.

Ploy
Amusement's?

Rest- <\nd Sleep?
Finding or M.AKing
Food <&.nd DrioK ouid
things which do not'

g <x Shelter <md
s which do l>sh ?
Tools.?

WORKING OR PRODUCING

If you look back at our account of Crusoe's working
day (see page 85), you will see that all the things which
he did can be fitted into one or other of these headings.

You will see, also, that it is not a very easy thing to
choose between all these different activities. The
problem is the same as that which we have seen in all
situations where economy is needed.

Crusoe has a limited amount of time. His hours are
scarce. Only 24 in each day. What he must do is to
spend them in the best way. To do this, he must not
give up too much time to any one kind of action. For if
he does, he will have to go without something which he
will want more strongly. Too much sleep means too
few bananas. Too long exploring means he cannot
make that hammer which he wanted for his hut. Too
H

98 ECONOMY IN PRODUCTION

long work means too little fun. Too much fun means
not enough to eat. In every case he must choose how
much time is to be spent in each different way. He
must not waste time either by sleeping all day or
eating all day or working all day. In fact, he must
economise his time.

Summary. We must think out carefully first what
are our different wants, since we must spend some of
our scarce time in producing goods to satisfy these
wants. Spending our time on jobs which give us some-
thing over and above the enjoyment got from doing
the job we can call Work or Production. Spending time
on doing things only for the enjoyment of doing them
we can call Leisure or Consumption. Since time is
scarce, we must choose between so much producing
and so much consuming, as well as between the different
ways of producing and of consuming. However you
spend your time, you have to go without something
else, which you might have done or made with that
time. Here again the need for economy.

Written work. Take the list of ways in which you
spent your 24-hour day, which you made for the
Question on Chapter 10. Write as nearly as possible
the amount of time which you spend on each different
way. You decide now that you will spend two hours
a day extra on your work. How will you find the time
for that extra two hours ? Give reasons why you
decide to cut down any of the different ways of spending
time, and why you decide to cut them down by any
special amount.

CHAPTER 12
MAKING A STORE

HAVE you at any time ever made a store of things ?
It may have been pencils or chestnuts, or chocolates
or pennies. Most people lay up a store of things
some time or other. Whatever it may have been, I
expect you felt it was a desirable thing to collect
together a number of things more things than you
could make use of at any particular moment.

When you do this, you are really saving. You are
saving up things which you may want later on. You
will see that I have included saving as one of Robinson
Crusoe's ways of spending his scarce time. He might
spend an hour or two each day making a store of things.
It is exactly the same when you spend some of your
time in autumn looking for " conkers." Instead of
rushing into the roads and searching the ditches every
time you want one, you may spend some of your time
deliberately looking for them, because you know that
later on you will be able to make use of them, even
though at the moment you do not need them.

If you look back to Chapter 3, page 21, you will
remember that saving by the family was done with
money. They set aside a part oi their income every
week for some special occasion ; perhaps for a sudden
illness, or for an extra holiday ; or to help one of your
relations ; or to buy a wireless set.

In Chapter 7 we saw that money is useful ultim-
ately because it buys the things we want. Saving,
money, therefore, is useful because later on we get

99

100 ECONOMY IN PRODUCTION

these things with the money, whether they be medicines,
or holidays, or wireless sets.

In the same way, our shipwrecked sailor cannot
put aside money with which to buy things later on,
because he has not got any, and if he had, it would
be no use on an uninhabited desert island. But he can
put aside something else which he has got. He can
put aside his time in collecting the things he may want
later on.

Now why should Crusoe want to take up some of his
time in this way ? Why not live happily from day to
day, picking his coconuts and eating them as he wants
them ?

The Uncertain Future.

The reason is that you never know what may
happen. He may have been wrecked on an island far
from the ordinary trade routes of passing ships. He
may tie his shirt to the tree on the island, but, hope as
long as he may, the rescuers may never hove in sight
and see that shirt. The years may go by. Crusoe
may become an old man. Too old, alas ! to climb up
the coconut tree any more. Too old to catch the fish
in the sea or the fish in the lagoon. Too old to cut
down the hard mahogany trees with his stone hammer.

What can he do ?

Unless he is to perish, he should foresee the future,
and make a store of coconuts against these years, or a
store of wood to light his fire, when his arm is no longer
strong. I fear a store of fish would not be a great
success. That is one of the advantages of saving money
rather than things. You can save your money and
turn it into a nice piece of cod, when you are 70, but
if you came to store your cod the result is not so
good !

In making a store, then, of things, coconuts or
wood, Crusoe will really be providing for the future. He

MAKING A STORE IOI

has realised that to be wise, he must think not only of
to-day but of to-morrow as well. He must provide
not only for the needs of to-day, but for those of next
week.

There is another method by which he can take heed
of the future. That is, by not consuming too much of
his things to-day.

Greed and . . .

Imagine that there is a small lagoon on his island.
Our shipwrecked mariner soon discovers it. He sees
a few nice plump-looking fish. " Ha ! " he may think.
" This looks better. I'm sick of bananas for breakfast,
coconuts for lunch, and bananas again for supper.
Here is a pleasant change." He makes a boat, and he
makes a spear, and he soon catches a fine fish for
breakfast. He is so pleased, that the next day he does
the same ; and so on every day for a month, until
there are no fish left. He was very greedy, and there
were not very many fish to start with.

Then he sits down, along with his coconuts and
bananas, to repent at leisure (he had a good deal of
leisure, you remember). " If only I hadn't eaten all
the fish they might have had a chance of breeding,"
he thinks. " Then in a little while the young fish
would have grown up and provided me with a good
tasty supper. Now there is nothing but wretched
bananas again ! "

Thrift.

Actually, then, if he had thought of providing for
the future, he would have gone more slowly with his
consuming in the present. " Saving " in the sense of
thinking of time to come may not be just making a
store, but it may be just not spending too much on the
present. It is rather like the old story again of not
being able to eat your cake and have it at the same time.

102 ECONOMY IN PRODUCTION

Only now we say : " You can't eat your fish now and
eat it in the future." You can either eat it now or
you can eat it in the future. Or you can eat half now
and half in the future. You have to think whether you
would prefer to have it at this moment of time, or
through (during) time to come.

There are big advantages, as you will see, to be
gained from making a store. Some people, however,
start off by seeing the advantages of saving, and then
get so enthralled by the business of saving, that they
forget what they originally saved for. They lose all
good sense in life, and become misers.

Why Should We Save ?

The reason we have seen so far in making a store
was that it made our future life better in some way, and
that later on we were going to enjoy what we had saved
now. But misers become unable at any time to enjoy
what they save.

There is another purpose and result of saving. That
is to save ourselves time and trouble. Not in the present,
but in the future.

Look at the map of our island.

You will see that in the S.W. corner there is a planta-
tion of mixed banana trees and coconut trees. Neither
of these trees, thinks Crusoe, will make very attractive
wood for his hut. Up in the N.E. corner, however,
ten miles away, is a mahogany tree plantation. Away
in the east is the fish lagoon, but he has not yet built
a canoe, nor made a spear, so he cannot get any fish,
and there is no other kind of food in the island, so far
as he can see.

" Well, there's nothing for it ! " he thinks. " I
must have my banana breakfast early, walk over to
the mahogany wood, cut down what I want, and bring
it back to make my hut under the shadiest coconut
tree. It will be a tough job, but once it is done, it will

MAKING A STORE

103

save my walking ten miles from the mahogany wood
to the banana grove every day before I can have break-
fast ! " So off he set every morning after an early
meal. He hacked wood all day, and carried it back in
the evening to the bananas and coconuts.

" Phew ! " he thought one sultry evening. " This
is a wearisome business. I must think whether there's

THE ISLAND AT FIRST

some plan which will help me to get on with this a bit
more quickly. All my time and energy are taken up
walking to and fro."

The mahogany trees were especially hard and some-
times he had scarcely any wood to carry back.

" This is a hopeless job," he thought. " I really
must do something about it/'

That night he lay on his back for quite a while. He
was so tired, that his banana supper had not agreed too
well with him, so that he had not gone to sleep. At
last, suddenly, he thought of a plan.

104 ECONOMY IN PRODUCTION

" Why on earth didn't I think of it before ? " he
said to himself, just as he slipped into sleep.

Next day, he spent all day picking bananas
and coconuts. He made a big bundle of them, and
in the evening he trudged over to the mahogany
wood.

" Those will last me ten days/' he said to himself.
" I can sleep over here, and I needn't walk back to the
banana grove until they're all finished."

In this way, you see, he had saved up ten days 9 worth
of bananas. That gave him the chance of getting on
with his work, without the ten-mile journey twice a day.
The purpose and the result of saving the bananas was
to save him a vast amount both of time and of unnecess-
ary labour, and he was able to get on.with his hut much
more quickly.

While our Crusoe was saving himself time and trouble
in this way, he was really saving up something else
at the same time. This brings us to the third purpose
of saving.

When he saved bananas, the bananas did not change.
They remained, quite naturally and quite properly,
bananas. One or two of them may have got slightly
bruised, when he carried them over to the mahogany
wood, but that could not be helped. They were still
bananas.

But the wood he saved did not remain wood. What
happened to it ?

There's no magic about this. We have, unfortun-
ately, passed away from the days of Aladdin's genie.

The wood became a hut.

Crusoe worked on it, and hammered it, and cut it
and carried it, and dug it into the ground, and it did
eventually become a hut, which kept off the baking
sun and the violent rainstorms, and the coconuts which
had occasionally dropped on his head at night, very
much to his annoyance.

MAKING A STORE 105

Something New.

But the wood only became a hut, because he had first
saved up the means of making it into the hut. Unless
he had got together a lot of wood, Crusoe could not have
made it at all. That is where saving comes in. You
make a store, and then with the store you make some-
thing different, something which, before, you had not got
at all. If it had remained " just wood " he would
have used it for making a fire, and if he had burnt up
all his wood in this way, he would not have got the hut.

Of course, he did not have such big fires every night,
as if he had burnt all he cut down ; but he felt it was
worth while to do with a little less fire now, so as to
have something better and different the hut in the
future.

(Of course he could have done the same with the
bananas, and the coconuts. He might have saved up a
couple of bananas and a coconut one day, and mixed the
milk from the coconut with the banana to make a fruit
trifle. That would have been something different, too
but unfortunately he did not think of it.)

The importance of the hut (unlike the fruit trifle)
was that it went on giving satisfaction, not once, but
every night he slept in it. In fact, all the time till it
was blown down by a gale. It gave satisfaction
through (or during) time, instead of once only, like the
wood he burned on the fire. But before he could
change things to do this, he had to save up the things
first.

Something Useful.

As time went on, Crusoe saw that there were a good
many other things he could make with his wood.
Things which he could use in his work. He made, not
only a hut, but a bow and arrows. After that he made
a spear. With these things, he was able to catch fish
in much less time, Or he was able to catch far more fish

IO6 ECONOMY IN PRODUCTION

in the same time as before. It comes to the same
thing. // saved him time and trouble, or else it gave
him far more things for the same amount of time and
trouble. Suppose he caught ten fish in one hour, with-
out the spear. With the spear he could catch 30 fish
in one hour. Or he might catch ten fish in 20 minutes.
Or even five fish in ten minutes. He could do which-
ever he preferred.

Also he shot birds with his bow and arrows, and
thus got different food from the earlier vegetarian diet
of which he was getting rather bored. These useful
things are called Tools.

By saving up his wood, then, he was able to make
tools, which helped him in all the ways we have already
seen ; i.e., these tools in their turn saved him time and
trouble, or gave him more things than before, and also
they helped him to have different things from those
he had originally had. But before he could have the
tools, he had to save the things with which he could
make them.

Economy in Saving.

Now in saving, there is always need for economy
of the right kind. We have already seen that he might
only think of the present, and eat up all the fish in the
pond, leaving none for the future. That would have
been bad economy of saving his fish : too much for the
present, and too little for the future.

It is possible, however, that he might have thought
so much of the future, that he went for a whole six
months without eating any fish at all. " All the more
for me later on," he said to himself. But at the end of
six months, a ship might have appeared on the scene,
caught sight of his shirt on the coconut tree, and rescued
him from his lonely island. No doubt Crusoe would
have been duly thankful, but he could not have helped

MAKING A STORE 107

thinking that he might have had some of the fish to eat,
after all, during that six months. Actually he had
made a bad economy of saving again. Too little
consumed in the present and too much set aside for the
future : more than could actually be enjoyed.

On another occasion he might have used all his day
carving and making a good sharp spear. When night
came, he might find that he had forgotten to collect
any wood to make his fire. Perhaps rain fell, and the
result would have been a wretched, cold, wet night.
That would again have been bad economy. He would
have chosen too much time for providing for the future
and not enough for the immediate present. Too little
saving will make us spendthrifts. Too much saving
may make us misers.

The object of right saving, then, is to divide up your
time and your labour and your things, so that you have
just the right balance between present and future. In
other words, to spend your scarce time and scarce
goods wisely between present and future. When you
do this, you economise not in time and goods now
(this was the problem in the last chapter) but you
economise through or during time ; you economise
between now and later on.

Summary. Some time and labour can and should
always be put aside for saving, i.e., providing for the
future. This makes the future more secure. Saving
can also be carried out by not consuming what we have
at present. Saving, or making a store of things, may
save us time and trouble. It may give us different
things from what we originally had. Saving also can
result in having useful tools with which to work. These
tools save time and trouble, they provide more for the
future, and they give us different things, too. As time
and goods are scarce, one must divide up carefully one's
scarce time and scarce goods between doing things for

IO8 ECONOMY IN PRODUCTION

the present and doing things for the future. That is
economising " during " time.

Written work. Saving helps to give us the tools
and machines which help us in our work. Make a list
of any tools or machines, which help work, and which
are used in your own town or village. Make a separate
list for the tools which are used by hand ; and for the
machines which are used by some means of power other
than hand, whether water, steam, gas or electrical
power. Describe what your lives would be like without
the machines, which are used by power.

CHAPTER 13
ANOTHER SHIPWRECKED PARTY

ONE night our shipwrecked sailor was sleeping peace-
fully in his hut. His bow and arrows and his spear
lay beside him. A pile of coconuts for the next day's
breakfast was stored up beside him.

Suddenly, he was awakened in the dark. A wild
wind had arisen, and a branch had fallen from a tree
on to the roof of his hut. He sat up and listened.
The waves were roaring and crashing a hundred yards
away on the beach. The coconuts were flying about
in all directions.

He was just about to lie down and to try to sleep
again, when a strange noise, unlike any that he had
heard for many months since he had been on the island,
caught his ear. Was it possible ? Surely he was
mistaken. He lay down again.

" Imagination/' he thought, " or the wind whistling
in the leaves."

He lay back ; but just at that moment, once again
the sound startled him. He jumped up and, pushing
against the wind, he ran down to the sea. There, sure
enough, was a party of half a dozen men, wet, ragged,
weary and exhausted, but alive ! Their small boat lay
broken on the beach.

The next day he heard their story, of how they had
been forced to the lifeboats in a great storm, driven far
out of their course, and washed up on the island by the
hurricane of the previous night.

Crusoe showed them round the island.

109

110 ECONOMY IN PRODUCTION

" Not so bad," said one.

" Have to put up with it," said another.

" Ought to be enough for us all, I suppose/ 1 said a
third.

So they decided that they must make the best of
things, and get on with the job of settling in, until
another ship rescued them.

Each for himself.

Crusoe found life, naturally, very much more enjoy-
able than it had been. The men told yarns in the
evening ; they worked together during the day ;
they bathed and swam in the sea, and sat about in the
sun on the sand. Life was certainly a bit monotonous,
but it was a great improvement on the solitary past.

They decided that the fairest plan for everybody was
to divide up the banana and coconut trees, and the
mahogany trees as well (of which there were in all a
good many), among the seven inhabitants of the island.
Each man had a certain number allotted or shared out
to him.

They next decided that they must each have a hut.
The first night in the storm, they had all crowded into
Crusoe's hut. But there was only room, comfortably,
for one, and it was no use trying to make it do for seven.
So, as soon as they had got their bearings, Crusoe
showed them how to make an axe, how to pack up a
store of bananas for a week or so, and where the mahog-
any tree plantation was situated. After a few days,
the six men were to be seen all busily cutting down
wood, and carrying it over to the banana grove, where
each one was preparing to build a hut for himself.

After the second week of this, they came back one
evening with the wood they had laboriously cut,
and found Crusoe frying a nice piece of fish on a wooden
skewer over the fire. They were all feeling rather
sorry for themselves.

ANOTHER SHIPWRECKED PARTY III

" This wood-cutting business is all very well, but my
back feels as if it were pulled out with ropes to-night,"
said one.

" So does mine," said another. " Look at George ;
he's the only one of us that can stand up straight. But
then he's cut wood all his life, before we started on this
pleasure trip ! "

" Pleasure trip ! " said a third. He was a little
chap called Bill. " If that's what you call lugging
these great lumps of wood ten miles on your back, my
next pleasure trip will be watching the cranes load up
the ships in London Docks. I wasn't built for a crane
myself, like Fred or Harry here. It's all right if you've
carted orange boxes on your head all your life but I
haven't ! "

" Hullo, mate," said one of them finally, " that
smells good ! Where did you get your fish ? I'm
about sick of bananas for breakfast, bananas for lunch,
bananas for supper. I think I'll see if I can do some-
thing in that line to-morrow ! "

" That's a good idea," said Fred. " I'm going to do
the same. I want a bit of change " ; and the others
all agreed.

Fish.

So the next day Crusoe took them down to the
lagoon, and showed them how to cut and shape a spear,
and how to harpoon the fish. They spent a good deal
of time making these tools, but eventually they were
ready. However, when they all appeared round the
lagoon, they made so much noise, and their shadows and
movements were so continuous, that the fish took fright
and retired to the bottom of the water.

At the end of the day, the men looked rather ruefully
at one another.

" We don't seem to have had much luck, do we ? "
one of them said.

112 ECONOMY IN PRODUCTION

" No, that we don't," said another, " all except
Jack here, that is. He's done pretty well. How did
you manage it, Jack ? "

" Well, I don't think much of your spears, when it
comes to fish," he said. " Look ! I'll show you.
This is what I do," and he lay on his stomach by the
lagoon, and proceeded to show them how to slip his
arm carefully into the water, until his hand lay under a
plump fish. Then, with a flash he jerked his hand up,
and the fish was lying on the land.

" All very well for you," said George, " but that
takes a bit of learning ; I can see that. Anyhow, this
wasn't too good a day. We shall have to do some-
thing about it."

That night they discussed the position. Jack was
feeling pretty cheerful, as he sat round by his fire eating
fish, but the others had so little, that they had to make
up with bananas, of which they were, of course, heartily
tired.

They appealed to Crusoe.

" Well, what about coconuts ? " he asked. " It
would be a change, at any rate."

Huts and . . .

The others agreed, though not very enthusiastically,
and they were just settling down for the night under
the trees, when the sound of splitting and rending came
from Crusoe's hut. A moment later he appeared in
the doorway.

" There it goes again," he said. " That wretched
beam never keeps in place ; the roof's pushed the
corner-post right out and I shall have to sleep under
the trees to-night, and take the roof all down, and put
a new side post in again to-morrow. It's always doing
that."

44 And not much wonder, too. Look at the size of
your roof, man ! You've got all the weight in the

ANOTHER SHIPWRECKED PARTY

113

wrong place. I'll show you what to do about it in the
morning. If you go on like that, it'll come down on
top of you one night, and you'll be found brained to
death. 1 '

" All right, Tom," said Crusoe. " You lend your
skill on this job."

THE SAME JOB FOR ALL

" We don't seem to be getting on very rosily at the
moment," said Bill as they dropped off to sleep.

Coconuts.

The next day the sun shone pleasantly as usual, and
off they all went to pick the coconuts,
i

114 ECONOMY IN PRODUCTION

When evening came, they re-assembled round
Crusoe's hut. They looked a sorry company. Their
hands were torn and bleeding ; their knees were
skinned ; their clothes were in ribbons. Fred had a
great lump on his head, from tumbling off a branch and
knocking himself badly. Harry had sprained his
wrist in a fall.

" All right for featherweights, but not much good
for us," they said. " Where's Bill ? "

At that moment Bill came in sight.

He was loaded with coconuts, so many that he could
hardly carry them, in spite of tying them together with
ropes of fibre which he had wound together.

He walked into the ring of men. %

" Hullo, mates ! " he said. " Been having a scrap
together to pass the time ? Or has a band of pirates
attacked the troops ? You don't look very bright and
merry."

The only reply he got was a series of grunts and
growls.

" Eight-stone-nothing-monkey-up-a-stick. You're
all right up a tree, it seems, but don't be too funny
about it," was the only reply he got.

That night, Robinson Crusoe lay thinking about the
day's doings.

" We can't go on like this," he thought to himself.
" We're getting a bit too irritable with one another.
I seem to have got on all right by myself, because I'm
something of a handy all-round man. But these chap?
are trained fellows, and although they can each do osie
or two things really well, they can't do half the tjs&gs
they need to do. I must think out something J& help
things."

Just as he fell asleep, he thought of a plan.

What is yours ?

ANOTHER SHIPWRECKED PARTY 115

Summary. When a lot of people have to work
together, their abilities to do different jobs vary. The
total time a number of men have now for producing
goods and services or for saving is the addition of all
the times which each man can give separately. This
presents both a problem and a possible means of further
" economy."

Written work. In what ways do you think people
differ especially from each other ? How do you think
the differences will affect the kind of work which they
will want to do ?

CHAPTER 14
ROUND PEGS AND SQUARE PEGS

MORNING came, and as a Frenchman once said, " What
troubles are not eased by the dawn ? " Even those on
the island seemed less annoying in the cool air of the
early day. The new party was just preparing to set off
on another round of arduous laboufs, when our Crusoe
hove in sight.

" Here ! Hi ! " he shouted to two of them, who
were already some way off, " come back ! I've got
something to say to you all."

They gathered round.

" Now look here," Crusoe began, " yesterday was a
bit of a wash-out "

" Ay, it was that/ 1 said Ted. (He came originally
from Huddersfield before he was shipwrecked.)

" and the days before yesterday weren't a

great deal better either," Crusoe went on. " On
Monday, Fred nearly broke his thumb with the mallet,
trying to make his hut. On Tuesday, Ted falls into the
lake, and gets himself half-drowned, fishing, and would
have been quite drowned, too, if Jack hadn't pulled
him out. Wednesday, Harry mistakes his leg for a tree
stump, and tries to chop it down. On Thursday, Bill,
being only a little fellow, strains his back carrying logs ;
and yesterday, Jack tumbled off the tree, and wouldn't
have been here at all, if he hadn't fallen into a prickly
cactus standing handy nearby. If we go on like this,
we'd better build a hospital and have done with it.

116

ROUND PEGS AND SQUARE PEGS 117

Apart from accidents and injuries, we're all getting so
fed up that, if this weren't going to be a hospital, it'd
be more like a public bear-garden."
He paused and looked round.

The Plan.

" Now my plan's this," he continued : " we're none
of us too good at all the different jobs we've got to do,
but each one of us is a pretty good hand at one at least
of those jobs."

" That's right," said Jack ; " so we are now ! "

" Take George, now. He doesn't give exactly a
striking performance climbing up the coconut trees,
does he ? But he's mountains better than the whole
lot of you put together when it comes to cutting them
down ! Give him an axe, and I reckon you can't find
a man to beat him.

" Look at Fred and Harry, on the other hand.
They're more like a couple of oak trees themselves.
They aren't long enough in the arm to do so much
damage with an axe as George can, but they're just
built for carrying the logs. Put twice as much on
their backs as you other chaps can carry, and they
still come in grinning.

"Then we've got Bill and Jack and Ted. Bill's
all right. Send him up the trees. You saw him last
night. Fresh as a daisy. Ted's our first-class car-
penter and builder. He can put up a hut while you're
standing round looking at it, wondering which end of
the wood is going to knock your head first.

" And Jack's our fisherman. He's as useful in the
water as you chaps are out of it."

Crusoe paused.

"Well, that's all right, but what about it ? You
haven't told us much more than last week's news, so
far as I can see," said one of them.

Il8 ECONOMY IN PRODUCTION

Each for Everybody.

" Why ! Don't you see ? " said Crusoe ; " it's like
this : each one of us is first-class at one job, but not
a great catch at all the other things. Give each one
the job which he can do, and let him do it all the time."

The men sat and thought about this.

" Well, that's all very well," said Fred after a while,
" but if I spend all day and every day humping the
wood cut down by George, how am I going to get any
food for myself ? As we manage now, every third day
I spend getting food for the other days, when I'm away
up in the mahogany plantation."

" But don't you see," said Crusoe. " Bill will spend
all his working time getting food ; and as he will be
able to get far more than he wants' for himself, he'll
give some of his food to each of you chaps."

" Well yes but will he ? " asked Jack.

" Why should I bother to get food for them as well
as for myself ? " said Bill.

" Why, of course, it's like this : you'll spend your
day getting coconuts and bananas for all of us ; and
Jack will get fish for all of us, too, including you ; and
Fred and Harry here will carry logs for all of us, and
for you, too, because you're only a little chap ; and
George will cut them down for you ; and Ted will make
you a hut. If you don't get food for them as well as
for yourself, nobody will get your fish or build your hut
or do any of those things for you, which you obviously
can't do for yourself. Everybody does the thing he
best can, and then we exchange the things among us,
or we exchange the jobs, if it's like carrying some-
thing."

" So we'll just be doing those things we're used to
do, and the things we can't do, somebody else will do
for us ? "

r " Well, if it means that I'll not have to go scrambling
and scrumbling up those coconut trees any more, I'm

CRUSOES

PLAN

A DIFFERENT JOB FOR EACH

120 ECONOMY IN PRODUCTION

for it," said Harry. " I vote we give the plan a try-
out, and see how it works."
So after a little more talk, off they went.

Results.

After a week, they assembled one warm evening at
the entrance of the first hut finished by Ted. Every-
body was cheerful. They told stories and sang songs,
and they agreed that life was much more pleasant than
it had been before.

" Well, Crusoe, your plan's turned out pretty well, it
seems," said one of them finally.

" That's true," said Jack. " I don't dream of
carrying mountains on my head any longer ! Things
are altogether much easier nowadays!"

" And what's more, we seem to get much more of
everything more bananas, and more coconuts, more
fish and more wood," said Harry, " and a hut up in a
week, instead of what looked like a couple of months,
as far as mine seemed likely."

" That's why we're sitting about so cheerful to-
night," said Bill. " We get more of everything, and
we enjoy ourselves better while we're getting it"

" Yes, and we don't have to waste so much time
making things to work with," said Fred. " Half our
days were spent, it seemed, making wooden axes ; but
now George just makes his, and we don't each have to
waste time making one for ourselves."

" A right daft lot of chaps we were, too ! " said Ted.
" Why, what was the use of each of us having an axe
for the wood, and a spear for the fish, and a hammer
for the pegs and goodness knows what next ! when
we were only using them about half an hour each day ?
And then they lay about idle all the rest of the time !
Now we can manage with only one axe between the seven
of us, instead of seven axes which one hardly ever wanted
to look at. Think of the time we save there 1 "

ROUND PEGS AND SQUARE PEGS 121

" Here's another thing ! " said Jack again. " Now
I'm spending all my day down by the lake tickling the
fish, I find I can do it a sight better than I did ! Time
and again the big wary ones used to slip through my
fingers and get away, but now I manage to land about
every other one at least ! "

" How's George getting on ? " asked Crusoe.

" Well, I reckon I'm getting into these hard-grained
trees a bit now," said George. " I never worked on
such tough stuff before in all my life ; but I'm beginning
to get the feel of them now ; it's a case of knowing how
the grain runs, and when to twist your wrists as you
hit it ! I guess you']l be getting some better planks
of wood soon, when I've had a bit more practice. Now
I'm on the job full time, I'll be getting the right skill for
the job, so to speak."

" Well, that's all right," said Crusoe, " and while
you've been at it this week, I've found something on the
island. I'll show you, to-morrow ! "

A New Idea.

So the next day they decided to have a day off, and
as they had all been getting on so well with their jobs
during the week, and as Bill and Jack had provided
plenty of provisions, they set off to a more hilly part of
the island, which hitherto they had not properly
explored. They walked up a sort of dry ravine for a
few miles, and when they came near the top of the hill,
they found a biggish lake.

On the far side, flowing towards the sea, was a
stream. It ran down through a rocky path and dis-
appeared, so far as they could see, over a cliff into the
sea, which was very near this side of the island.

The men gazed around.

" Nice place for a picnic," said Ted at last.

" Not so bad," said Crusoe, " but that's not why I
brought you up here. You see this stream ? "

122 ECONOMY IN PRODUCTION

" Yes," said the others.

" And you see this bank and these rocks ? "

" Yes."

"And you see where the water flows from the lake
down into the sea ? "

" Yes."

" And you remember the pathway cut in the hill
which we walked up ? Now taste this water ! " Crusoe
suggested.

The others did so gingerly.

" Well, it isn't tea," said Fred. " What's the matter
with it ? "

" There's nothing the matter with it 1 " replied
Crusoe. " That's just the point. Don't you see now ?
If we dammed up the place where that stream flows
out yonder ; and if we cut away this low bank of earth
and moved these rocks ; and if we dug it down deep
enough, the water would run down the ravine past our
huts I "

" Well, what'd be the use of that ? "

" What use would that be ? Why, this is the use :
what do you do when you want some fresh water ?
You have to walk a couple of miles to that little pond
in the sandhills. And what is it like ? Warm and
dirty, unless it's just been raining. But this water
will be running water, because it will come from this
lake up here. That means it will be clean water ;
and what's more, it will come right by your door, almost
as if the local Water Board had brought it there in a
lead pipe ! "

" And we won't have to walk two miles each time
our throat's a bit dry," said Harry.

So off they went.

George cut down some wood, and Ted, who was the
carpenter, made it into wooden spades, and before long
the stream was flowing merrily within 20 yards of their
huts.

ROUND PEGS AND SQUARE PEGS

123

Here is a map of the island after they had finished.
Compare it with the one on page 103.

The Island's Inventor.

The night it was finished, they gave Crusoe a vote
of thanks. Jack made a speech on their progress, and
at the end he said :

" Now, Crusoe, on your advice we've divided our

THE ISLAND LATER

labour up, so that each one of us specialises, as you
might call it, in one job, so that he'll soon be a master
of it. We're now all square pegs in square holes, or
round pegs in round holes on this island. But we've
been thinking for some days what is the best thing for
you to do, as we can see you're a bit of a handy man,
and good at most jobs to which you lend a hand, so it's
difficult to choose for you.

" So my mates and I have come to the conclusion
that you ought to be a sort of free-lance inventor and
explorer. It was your idea to think of our each doing

124 ECONOMY IN PRODUCTION

these specialist jobs, and it was you who thought of
bringing the water to our throats, instead of having to
take our throats to the water. That being the case,
we've decided, if you're willing, to keep you in food and
wood and fire, and Ted is going to make you a proper
hut, if you will agree to be our specialist inventor.
When you've got a good idea, you bring it along to us,
and we'll see what we can do with it. If it saves us
time and trouble like these last plans of yours, we
reckon it'll be well worth our while and yours
too ! "

After that they celebrated the occasion with an
extra large meal of fried fish 'and bananas, and Crusoe
was formally installed as the island's inventor.

It would take too long to describe his different inven-
tions ; and in any case, I think it would be better if
you tried to think out what ideas you could have
produced yourself, if you had been in Crusoe's place.
After all, you never know in what fix you might one
day find yourself.

Economy Again.

Now you may well ask : what has all this to do with
Economy ? If you think back to Chapter n, you will
remember that our shipwrecked sailor all alone on the
island, had a limited amount of time to spend each
day. He had to economise that time, so that he did
not spend too much in any one single job or pastime,
because if he did, he would have to go without some-
thing which he would find he had really wanted more
strongly.

When our six fellow-men were wrecked on the island
along with Crusoe, there were seven people in all who
could produce (albeit very unskilfully) any of the things
possible on the island, bananas, coconuts, wood, carry-
ing, fishing, thinking, exploring and so on. These
seven men were our total Labour-force.

ROUND PEGS AND SQUARE PEGS 125

At first all the men, that is all the Labour-force,
did a little bit of all the jobs, and most of them did
them badly, too.

After a time, they found that the Labour-force was
made up of all sorts of different abilities and powers.

George was tall and long in the arm ; Fred and
Harry were strong ; Ted was clever with his hands ;
Bill was nimble and good at climbing ; Jack was a
fisherman ; and Crusoe was a thinker. These seven men,
then, with these different abilities, had to supply all the
different things they wanted. So they found that
they wanted, very naturally, to get most of the jobs
done as quickly and as easily as possible especially
those for which they were least suited so as not to
waste their scarce time and scarce labour.

Therefore, they decided that they must economise
their labour. They had a limited scarce amount of
labour seven men and they chose that labour
that man to do that job which he could most easily
and happily perform. Crusoe became the inventor,
Jack the fisherman, Ted the carpenter, George the
woodman, Bill the climber and Fred and Harry were
the porters. By each working on the job for which he
was most fitted, they, all together, spent far less of their
time and labour in getting what they wanted.

Summary. The time and labour which all people
have for producing things and services can be used
most profitably to make those things it will " go the
farthest " if each man does the job for which he is
best suited. This is called the best Division of Labour.
By this means, more goods can be produced with the
least labour ; less tools are needed ; skill is increased,
and hence jobs are done more quickly still. This
enables wants to be filled with the least waste. It is,
therefore, one of the best methods of economising scarce
time and scarce labour in production.

126 ECONOMY IN PRODUCTION

Written work. In what ways is labour economised
by specialisation in :

(a) Your own home.

(b) Your school.

(c) Your own town or village ?

CHAPTER 15
AGREEMENTS

Trouble on the Island.

As time passed by, on the island, the custom grew
up that the inhabitants met together in the evenings
over supper to discuss the day's events, and to consider
whether there were any special difficulties to meet.

Usually there was nothing of particular importance
to relate, but one evening after an especially wet month,
Crusoe noticed that all his friends were looking gloomy
and out of temper.

" What's up, Bill ? " he asked the man nearest to
him.

The little man appeared unusually weary.

Wasting Time.

" Well," said he, after considering a moment. " It's
like this. As you all know, I've agreed with you chaps
to supply you with so many coconuts on condition that
you do certain things for me in return. That was because
I can climb up the trees better than any of you can.
But I didn't agree that I'd go on getting that number
of coconuts and climbing the trees if you break off all
the lower branches to use as firewood now the colder
nights have come. It takes me just about double the
time now to get up those trees, and if you can't think of
something better about it, you'll have to do without
coconuts, as I've had just about enough of skinning
my knees 1 "

127

128 ECONOMY IN PRODUCTION

" All right, Bill," replied Crusoe. " We'll think it
over, and see what we can do about it. In the mean-
time, what's the matter with you, George ? "

George was angry.

Misusing Things.

" One of you chaps has been using my axe again.
He's blunted the edge, and split the haft, and it'll take
me all to-morrow and the next day to put it right.
Why should I have all that bother because you haven't
the sense to use it rightly ? It's no good telling him to
put it right, because if he did try, it would end up more
like a saw than an axe, most likely J It isn't the first
time this has happened either. You've all had a go
with it at different times, and each time, it seems, is a
bit worse than the one before ! "

Wasting Things.

The fish in the pond were troubling Jack.

" It's all very well to talk about having enough sense
to use your axe rightly," said he, " but you can make a
new axe even if it does give you a bit of trouble. But
how about having a little sense with your fish-pond ?
You're all so greedy just now, for fish, that even after
I've supplied you with what I settled to give you in
exchange for the jobs you do for me, you must go down
yourselves, and sit there catching more and more for
yourselves. How long do you think you can go on like
that ? Do you think the fish will just fall from the
skies into the pond for you to catch ? During the
last three months, it has taken me nearly half as long
again to get your fish, as it used to do ! You may make
a new axe, but you can't go on taking fish for ever out
of the pond, at that rate, and expect to find enough
there next day ! "

AGREEMENTS I2Q

Wasting Labour.

When it came to Ted's turn, he was likewise upset.

" There doesn't seem to be much proper order on
this island," said he. " What's the good of a man
cutting up that timber all into right lengths for making
different things, and stacking it away, and then for
some of you to come along and take it, just as you
please, without asking me first which you'd better
have ? "

" None of you know," he went on, " how to put two
pieces of wood together, which is bad enough. But,
when you come to use this wood for your firewood, all
I can say is that I shan't do any more extra work of
this kind at all, if it goes on ; I shall just do what I
settled to do as my proper share, but if you want any
extra lengths for your odd jobs, you'll have to cut it
all for yourselves ! "

Agreements.

" Well, Fred, what about you and Harry ? " Crusoe
asked at last. " What's your complaint ? "

" I don't know that we've exactly got any of our
own as yet," said Fred. " Humping the logs goes on
pretty well as it always has ; though, when it has
rained as it has this last month, the path gets all broken
up and it's heavy going then. I don't know whether
it's right for us two to have to keep it all in order when
we all of us use it.

" Now we each agreed to do a certain amount
of work for all the others, in return for a certain
amount of work from them. Now, if the work
becomes more difficult, as it has for Bill, climb-
ing up his trees ; or, if the fish become scarcer
in the pond so that Jack can't get as mny for
us as he did, I can see that we shall have to revise the
amounts of work that we can expect from either of
them. That is, we must agree that in future, say, I
K

130 ECONOMY IN PRODUCTION

can't expect more than two coconuts a day from Bill
instead of three, in return for what I do for him carry-
ing these logs here. That seems all very well and
good. There's a good reason for making the change. "

Breaking Agreements.

" But," he went on, " supposing that some of us
want to make a change without a good reason ? How
about it then ? What should we do if George says one
day that he is only willing to hew down one tree a week
instead of two ? If we all start doing that we shall all
end up by doing nothing at all for anyone else, and
that won't be very rosy for us. In fact, it won't be
any better than the state of things that we were in
before we began to divide our labour up among our-
selves. It seems we ought to have some idea on that
matter, otherwise we shan't know where we stand ; and
it's no proper thing to do work unless you know pretty
well what you're going to get in exchange for that
work ! "

Nobody 's Job.

" Before we think out what to do about this," said
Crusoe, after a pause, " have you noticed how dirty
the water is in our drinking stream ? These rains
have washed so much mud and sand down the stream,
that it is all silted up in places ; and to get some clean
water again, the bed of the stream ought to be well dug
out."

" So that's that ! " said Bill. " What do we do
about it now ? "

" Sleep on it," said Crusoe. " I'm tired, and there's
a lot that needs thinking out over all this."

Next evening he had arrived at some conclusions.

" I've thought it over," said he. " As far as I can
see, there are a good many agreements needed among
us, and the details we must think out as we go along.

AGREEMENTS 131

But these are the chief points that strike me as import-
ant :

" Firstly, we want to satisfy our wants with as little
of our scarce time as possible."

Private Property in Tools.

" Therefore, we don't want people to use other
people's tools and harm them because then we have to
waste time and labour putting those things right again.
Therefore, I say you should agree that certain things
belong to certain people, who have complete right over
them. They should be their Private Property. After
all, you own your clothes in that way. Your shirt and
trousers are your private property, and the hut which
Ted has made for each of you is also your own property.
So it is just carrying on the same idea if you make your
tools, your axes and knives, or the things you make
with them such as Ted's timber lengths, your private
property too. The special object in doing so will be
to economise your labour by saving waste."

Private Property in Things.

" Secondly, you should agree, I think, to give control
over the fish-pond to Jack, and control over the coconut
plantations to Bill. They have to get their living by
working there. They know far more about them than
any of the rest of us. If we make the pond Jack's
property, and make the coconut trees Bill's property,
that will give them this control, and then the same
rules will apply to anyone who interferes with them, as
it would to anyone borrowing George's axe, and break-
ing the haft.

" In that way, we shall economise the fish and not
catch them all, otherwise Jack would lose his job and we
should in the end lose our fish.

" Or, as far as Bill is concerned, we shan't lose our
coconuts by making it too difficult for him to climb up

132 ECONOMY IN PRODUCTION

the trees, because we shall make the trees his property.
In helping him to climb the trees more easily we shall
economise in Bill's time, and that will give us more
coconuts for every hour that he spends on his job."

One or two of them were not quite sure about giving
the pond over to Jack, and the coconut trees to Bill as
their own private property.

" Can you think of any better way ? " asked Crusoe,
" to prevent Jack's fish, and Bill's time being wasted ? "

Should it be Everybody's Property ?

Ted thought it might be possible for everyone to own
the pond, just as everyone owned the river, but for
nobody to be allowed to interfere with it, without
Jack's permission. He said he thought that might
prevent Jack from catching the fish in his spare time
and eating them himself. Jack said that he didn't
feel very flattered at this suggestion, and that he was
tired of fish in any case, and much preferred coconuts.
But after they had discussed it at some length, they
decided that if they all owned the pond and the coconut
trees together, somebody would have to be appointed
to act as permanent overseer, in order to see that no
one broke the rules concerning them. As they could
not spare a man for this purpose they thought it was
simpler, for the time being, to leave the pond and the
coconut trees as private property for Jack and Bill.
As both their jobs depended on their treating the fish
and the trees properly, the others could depend fairly
well on Jack and Bill not to abuse their privileges.

Crusoe, however, thought there was something in
what Ted had said, and he promised to think it over in
the future.

" What shall we do if someone breaks the rules ? "
asked George, who was still feeling rather sore about
his axe.

" Well, if anyone does break the rules," replied

AGREEMENTS 133

Crusoe, " he must come up before the lot of us, and
explain why he did so ; and if he can't give us a good
reason, he must put things right in some way, if possible,
in his spare time. If he can't or won't put it right, we
must think out some suitable punishment to prevent his
doing it again. That will probably take a good deal
of planning out, I reckon," he added.

Everybody's Job.

" Thirdly," went on Crusoe, " about the water from
the stream. We all benefit equally from that water.
We all want it clean, but no one particularly wants to
dig the banks to keep it clean, because we don't get
anything in exchange for the work as we do when we
chop the trees or build the huts and so on. The longer
we leave it, however, the worse it will become, and the
more difficult to get it right in the end, as the banks
will all fall in, if we don't do something about them.

" Therefore, I think it is only right if we all agree to
dig out those banks between us. There are seven of us,
so we can take a day each in turn. If there were more
of us, we might put a man on specially to do the job all
the time. But we can't spare anyone from our other
jobs. So I think it will economise our labour best if we
each give a day's work to it. Of course, it will mean a
little less fish and coconuts and logs and timber work
for us, but it will keep the water decent, and it will
save us a vast lot of bother in the long run."

The men talked it over for some time and finally
they all agreed to carry out Crusoe's suggestions.

When that was settled, Crusoe said :

Upholding Agreements.

" Now we come to the last point, which Fred raised.
What are we to do if someone wants to change the
amount of work which they do for the others, when

134 ECONOMY IN PRODUCTION

they have once agreed to do a certain amount, and
when there is no good reason for making that change ?

" The best plan that I can suggest is that we all state
exactly how much work we agree to do in exchange for
how much work from everyone else. If we declare
this openly, then we shall know what we consider right
and proper. If a good reason occurs why that amount
of work should be altered, then whoever wants it altered
must put forward his reasons in public before all the
rest of us. If we all think *that the reason is sufficiently
good, then we will allow the change to take place.
If not, then the change cannot be made/'

" But suppose he still refuses to work at the old
rate ? " asked Fred, who had first seen the difficulty.

" Then he must be forced to carry it out, if it is for
work that he should already have performed. If he
still refuses he must be punished. If it is for future
work, which he did not promise to do at any special
moment, he can, of course, offer to do less or more if he
wishes. But then any of us can also offer to do less or
more too, because we are free men and not slaves ;
and we can always live on the island without our
neighbours' work if we can't come to any agreement
with them about how much we shall do in exchange for
one another. If we all start doing this, of course, in the
end we may find that we shan't get any agreements
with one another at all, so we must think carefully
before we do start to alter our working agreements with
one another, otherwise we shall all be where we were
before we divided our scarce labour among ourselves."

In this way, they decided on these agreements, which
they considered were necessary so that production
should go on smoothly on their island, and so that they
should not waste their scarce time, labour or property.

They had come to the conclusion that if they made
certain rules, regarding the way in which they worked
and lived together, then their wants would be more

AGREEMENTS 135

economically satisfied than would be the case if they
had no rules.

Finally, to cut a long story short, one of Crusoe's
inventions led to their rescue by a passing ship, and
home they all came in due time.

Summary. The satisfaction of wants by the best
Division of Labour cannot be carried out unless there
are certain rules and agreements, made and kept by
everyone concerned. Firstly, people must be allowed
to own certain things for themselves in order to prevent
waste of labour, time and property. This is called
having Private Individual Property. Secondly, every-
body must agree to take a share in jobs, or to own
property together, from which everyone together
benefits, but which cannot be left to any single person.
Lastly, agreements, concerning their work or goods,
once made between people, must be faithfully carried
out. To uphold these rules, people must meet together
regularly, and take common action, and, if necessary,
award punishments against offenders.

Written work. Either : (i) Make a list of a
dozen of the things which you own for yourself which
you consider to be the most important of all the things
which you own. Then make a list of a dozen of the
things which your father or mother own, and which
you consider to be the most important of their things.

Or : (2) Who " owns " : (a) The roads ; (6) the
fields ; (c) town parks or village greens ; (d) railway
lines ; (e) your school ; (/) your trams if there are any
where you live ; (g) the water in the taps ; (h) a coal
mine ; (i) a museum ?

Or : (3) Who employs and pays : (a) A dustman ;
(6) a postman ; (c) a coal miner ; (d) a sailor ; (e) a
doctor ; (/) a milkman ; (g) a policeman ?

OUR POPULATED WORLD

CHAPTER 16
THE ROAD OF PRODUCTION

THE last we saw of our shipwrecked party was their
happy rescue by a passing ship. Home they came
once more. Let us hope that their forced holiday on
the island had not proved entirely valueless.

When the joy of their return to the world of cities
and villages, streets and byways, factories and work-
shops, families and population hati somewhat died
down, perhaps they thought sometimes about their
ways of living on the island, and whether those ways
might teach them anything of use to the populated
world which they had regained.

Summing up again.

Doubtless they sometimes met together and talked
things over, discussing old times. As they did so,
gradually certain facts stood out concerning their life
on the island. We can write down a short list of what
those facts might be, in something after this fashion :

1. They all had a limited amount of time to do things

in, even on the island. Their time was scarce.

2. If they used their time badly, if they economised

their time badly, they would give up too much
time to things which were not very important,
and not enough time to things which were
more important. They must spend their
time wisely.

3. To spend their time wisely, they had to plan out

firstly the things which were really important

136

THE ROAD OF PRODUCTION 137

to them, and secondly how to get those
things.

4. By spending their time on certain kinds of work,

they could make different things which they
wanted. What they were able to have depended
on what they did with their time.

5. The different ways of spending their time could

therefore be grouped together broadly in
three ways : Spending, consuming or enjoy-
ment was one ; labouring or producing was a
second.

6. And saving or providing for the future was a third.

7. Saving gave them different things from those

provided by Nature on the island. It gave
them more things in the future. Also it saved
their time or trouble, and again gave them
more things, because of the useful tools which
they were able to make.

8. Saving for the future, however, meant having

less in the present, because their time for
doing things was scarce. Good economy
meant that they must strike the right balance
between doing things for the future, and doing
things for the present. They had to economise
through or during time.

9. The different people on their island made up their

labour force or their supply of labour, with
which they could do things.

10. As their total supply of labour and time to do

things was limited or scarce, they all had to
economise it so that they did not use too much
for any special job (just as Crusoe by himself
had to economise his labour and time) ; and
they found that they could economise it best
by using the right man for the right job ;
that is, by a good division of scarce labour.
n. This good division of scarce labour made them

138 ECONOMY IN PRODUCTION

specialists, increased their skill, saved them
time and trouble, gave them more of everything,
and reduced the number of tools required.
12. Good Division of Labour could only be carried
out if certain rules and agreements were
upheld by everyone concerned. The chief of
these rules were, firstly, the ownership of
Private Property ; and secondly, the Common
Action of everyone together to do jobs, and
to own property which could not satisfactor-
ily be done or owned by individuals.

When they had drawn up this list and written all
the points down as above, one of them asked what
they should call it. After some 4i scuss i n on the
matter, Crusoe finally suggested that they should call
it " The Island's Economy/' because it showed the
different ways in which they economised on the island
and the reasons for so doing.

They all agreed to this, and then someone else said :
" What about the Economy of this Populated World
of ours, where we live now ? How do we all manage
it here ? "

When they came to consider this problem, they soon
found it was a very complicated process indeed, so
complicated that they did not really know where to
begin, till at last Crusoe said :

" Let's see if our island economy can't teach us how
to look at it. It may help us if we try to see where
things were the same, and where they were different
from our present world."

So they set themselves down to work along those
lines, and this is something of the conclusions to which
they came.

Many People

First of all, they saw that they must consider, not
how one person, nor half a dozen persons, economised

THE ROAD OF PRODUCTION 139

in time and labour, but how many thousands and
millions of people did so. On page 96 we saw Robinson
Crusoe faced with many different ideas in his head as
to how to spend his day, and you will remember how
he had to choose between those ideas. These different
ideas were really different wants, either different
things he liked to have, such as bananas, nuts or axes,
or different things he wanted to do, such as sleeping,
eating, working or sitting in the sun.

When the six shipwrecked sailors appeared, we took
it for granted that their ideas, or wants, were much the
same as Crusoe's. This was not really quite true, but
as they were on a desert island, we were able to pretend
that it was so, because there were so few things which
they could get, that they had to be as contented as
possible with what there was. Ted might have wanted
a wireless set, and Harry a motor-bicycle, but as there
was no chance of getting either of those things, they
all had to be content with coconuts, fish and wooden
huts.

Many Wants.

In the world in which we live, however, there is some
chance of getting endless different kinds of things, from
kangaroos to cauliflowers, from aeroplane rides to seats
at a circus. All these endless different things, which
people can choose to buy or to make, correspond to
the endless different wants that different people have.
You may want kangaroos ; I may want cauliflowers ;
you may want aeroplane rides ; I may want the seat
in the circus. We will buy them, if we can, and some-
one will make them if possible.

This, then, is the first great difference between the
island and the populated world. On the island we can
think of everyone as looking and thinking very much
like Crusoe on page 96. In the populated world, we
can still think of each different person asking himself

140 ECONOMY IN PRODUCTION

the same question as Crusoe " What do I want to do
or to have ? " but we must think of each person often
answering them in a very different way from any other
person, because there is such an enormous variety of
things which can satisfy their different wants.

For instance, these might be the answers of Mr. X,
a gardener, and of Mr. Y, a motor-car manufacturer,
when they ask themselves what they want to do with
their day. (See illustrations on page 141.)

It should be quite plain that the things which Mr. X
wants are very different from the things which Mr. Y
wants. Mr. X wants footballs, running shorts, encyclo-
paedias and spades. Mr. Y wants seats at the cinema,
chauffeurs, iron and steel and copper^fittings for invent-
ing motor-car parts, and people to clean and work in
his factories and offices. When you come to think of
the food and drink that they want, it is obvious that
their wants may be still more varied. Perhaps X likes
onions and Y hates them. Perhaps Y likes lobster and
X cannot bear it.

Not only does Y differ from X, but Z differs from
Y and X, and A differs from Z and Y and X and so
on and so on and so on. Except in a few simple ways,
everybody's likes or wants seem to be quite different
from everyone else's ; and their powers of enjoyment
of these wants, so far as we can tell, may be utterly
different for each different person.

Crusoe and his friends soon realised, then, that,
in this populated world there is an enormous variety
of various wants or desires.

They saw, however, that somehow or other, a good
many of these wants do get satisfied. Mr. X did get his
onions, Mr. Y did get three hours' fun at the cinema.

Next, if they looked into Mr. Z's household, they
might have seen that he was so poor, that, although he
wanted a beefsteak for dinner, he could not afford to
buy it. Or, if they went to Mrs. A's establishment,

THE ROAD OF PRODUCTION

141

QcucK run tor

exercise

1 hoxjr tore&d

1J$ hours
football

on Pla^fs

I hours worK
Overtime to
rponey for c
wireless set.

And to buy
the tools he

4 hours

Rest &r>c18hours
Sleep,
8 hours
worK. for
Food <vnd DrinK *tc.

J.

id to p\y
Rent for his
bouse

3 hours At

No
Exercise ^

4 hours
study on

<\nd for

^ hours Rest

sleep,

6 hours worK
for food <sncJ
DrinK

<Nod to hfcy Ret)l
for l)i$ bouse

At>d to

pAy for up Keep
of his factories

they might have found that she was so rich, that her
horrid little Fido was eating the beefsteak which Mr. Z.
could not afford to buy.

It is quite true that there are many cases that what

142 ECONOMY IN PRODUCTION

many of us would consider to be foolish and silly wants
do get fulfilled, and that what we think are strong and
urgent wants do not get satisfied. But in spite of these
there are vast numbers of ordinary sensible wants, or
cheerful wants, or artistic wants, or kindly wants which
do get satisfied too. Our system satisfies people's
wants. If we do not approve of those wants, our job
is to change people's wants, rather than to prohibit
people from satisfying those wants.

How does this happen ? How do so many people
get what they want ?

The answer at first is quite simple.

They go to the shops or the cinemas, or the buses
or the seaside hotels and they buy \vhat they want.

Where do they get the money with which to buy
these things ?

Either from what they earn, or from what they have
saved, or from what people have given them.

But how do the things get into the shops, or the
cinemas, and how do the buses get on to the roads ,
and how do people come to let rooms to visitors in sea-
side hotels ?

Many Jobs to Satisfy the Wants.

These things come about, of course, because people
produce or make them. It is people's jobs to make
things which they and other people want. When they
work for their living, they go into some job, like furni-
ture making. They are paid for the work they do. The
furniture is sold to other people, and part of the money
for the furniture is set aside to pay the wages for the
man who makes it. With that money he can buy
his food, his drink, his clothes and other things, that he
wants. It is the job of other people to make this food
and shelter and drink for him.

How Money Helps.

It is exactly the same as the way in which our seven

THE ROAD OF PRODUCTION 143

men lived on the island, except that, instead of exchang-
ing fish for coconuts, money provides the means of buy-
ing different things to satisfy different people's different
kinds of wants ; and money provides the payment for
the jobs which produce the different things which
satisfy those wants.

The Road.

There is a road, then, which links different people and
their wants to the means of satisfying those wants.

Here is a simple view of this road :

Different People

have
Different Wants

satisfied by
People in Different Jobs

who make
Different Goods or Services

to fill
Those Wants.

We shall see later on that there are difficulties
over which, or through which, the road at present
must pass. We shall see also, however, that there
are signs and guides, which help to keep the right
goods on the road. If this method succeeds
in helping the right goods to reach the right
people, we can say that we are economising the scarce
time and scarce labour of our populated world.

Summary. In the populated world there is much
greater variety of things which can satisfy people's
wants than on a desert island. Wants differ very
greatly, as regards each person from any other person,

144 ECONOMY IN PRODUCTION

except for a few simple things. People's powers of
enjoyment are also very different from one another's.
Nevertheless, a vast amount of these varying wants do
get satisfied in our world. This is because people do
the jobs which, in the end, produce things or services
which satisfy other people's wants. This is made
easier, because people work for money, and buy things
with money. This is another difference in life in our
populated world from life on an island. A system
which brings the right goods and services to fill the
wants of the right people, with the least waste of time
and labour, will be the most economic system.

Written work. Make a list ef the dozen most
important things which you want to have or which
you have already got. Against each thing write down
the name of the job or jobs needed to make that thing,

e.g..

Wants. Jobs to fill wants.

Bicycle . . Iron and Steel Manufacture.
Rubber Plantation Work.
Aluminium Manufacture.
Hide Industry.
Bolt and Nut Industry.

When you have finished your list compare it with that
of someone else, so that you can have some idea of how
like or unlike your wants may be.

CHAPTER 17
SIGN-POSTS TO GUIDE US

LET us see first what sign-posts are set up to guide the
right kinds of goods and services along the Road of
Production.

In the first place, how do men and women know
what jobs are required to satisfy other people's wants ?
It was not so easy for Crusoe alone on an island always
to be sure whether he wanted coconuts or fish, and
therefore to know whether to climb the coconut tree,
or to set out fishing. It is obviously much more
difficult for Mr. X to know whether to grow onions or
carrots in his garden for Mr. Y, because he does not
himself know whether Mr. Y prefers onions or carrots.

How can he find out ?

Prices.

The method which has slowly grown up in our popu-
lated world, where people work to satisfy the wants of
others, is known as the Price System. Since people
work for money, and buy goods or services with money,
there has slowly developed a vast number of prices
which act as indicators or sign-posts to tell people
what sort of goods need to be produced. Now when
you know what sort of goods are required, you have
some idea of what sort of jobs are needed to make those
goods.

For instance, let us suppose people are making ice-
skates and tennis racquets. Ice-skates are sold for
355., and tennis racquets for 2. Then perhaps people
get tired of tennis and a craze for ice-rinks sets in.
L 145

146 ECONOMY IN PRODUCTION

People want to skate in summer as well as in winter.
What goods need to be produced now ? Obviously
more skates and fewer tennis racquets. How are people
who make these things to know this ?

They are told this by the movement in prices. If
people want more ice-skates than they used to, they
will give more money to get them than previously. If
people want less tennis racquets than they did, they
will not offer so much money as before.

The price of skates will perhaps go up to 455. a pair.
The price of a tennis racquet may fall to 305. only.

Now producers, people who make things, are always
watching these prices. The prices are the sign-posts
which tell them what to do.

When they see that skates have gone up in price, and
that tennis racquets have gone down in price, many of
the tennis racquet makers will stop making racquets,
and will begin to make skates instead. There will then
be fewer tennis-racquet-production jobs, and more
skate-production jobs.

Is not this what was required ? People's wants
changed from racquets to skates, and now people's
jobs have changed, too, from racquet-making to skate-
making. Along the Road of Production now are passed
more skates and fewer racquets to fill people's changed
wants.

We can set this sign-post, therefore, between people's
wants and the goods made. (See illustration on page

Movements of prices lead people into the right jobs,
that is, into those which will turn out the things which
other people most want to have. We see that the sign-
post stands on the Road of Production in this way :

Different People have Different Wants shown by Differ-
ent Prices of Goods which guide People into Different
Jobs to make Different Goods and Services to fill
those Wants.

SIGN-POSTS TO GUIDE US

Production of Goods. People's Wants.

147

PRICES DIRECT PRODUCTION

Or we can set it up, starting with the goods produced,
like this :

Goods-

-Production-
Jobs

PRICES/

-Wants ^People

Goods follow the jobs producing them ; the jobs
follow the price signs ; the price signs follow people's
wants.

You must, of course, remember that the world of people
wants a vast number of things besides tennis racquets
and ice-skates. Everything that people want, however,
has a price, unless there is so much of it, that we can
all have all we want, without anyone having to bother
to make it.

Since practically everything has a price, people

148 ECONOMY IN PRODUCTION

make things are constantly watching the movements
in prices which tell them whether or not they should
change the jobs which they are doing and make some-
thing else instead.

If other things keep the same, it is a movement of
price upwards, which makes people produce more of
those things, and a movement of price downwards
which persuades people to make less of that thing.

Here is a picture of the prices of bacon and of eggs,
and an imaginary idea of the numbers produced.

i/z

lb

too PICS

lO'OOO EGGS

The two sides of the balance weigh just the same
amount. Then if people want more bacon than eggs,
up goes the price of bacon and down comes the price
of eggs, thus :

ECQS

Producers will now hasten to put more pigs into the
balance on the pig side, and less eggs in the balance on
the egg side. This will bring down the pig side and
bring up the egg side.

We do not know what the final prices will be, but we

SIGN-POSTS TO GUIDE US

149

can guess that they are almost certainly different
from the original ones.

Perhaps they are like this :

It is the movement in the prices of things which
eventually guides people to the jobs they will under-
take.

But exactly why do people change their jobs, if the
prices of goods alter? You have seen that the prices
show people's wants; but if I have a nice little poultry
farm, why should I bother to stop collecting my eggs
and go and buy some pigs and a sty, just because
people's tastes have changed from boiled eggs to fried
bacon ? I may like looking after my hens much better
than cleaning out the pig-sty. Why should I change
my job, after all ?

The answer to this question brings us to our second
sign-post.

Profits.

People work only partly to enjoy themselves, and
only partly to make things for themselves. They work,
mostly, by making and selling other things to other
people, to earn money to buy other things for them-
selves.

Now, if the price of bacon goes up, people who have
pigs to sell will make more money (if the cost of
feeding and looking after the pigs remains the same
as it was). If the price of eggs goes down, people who

150

ECONOMY IN PRODUCTION

have hens will make less money (if the cost of feeding
and looking after the hens remains the same). There-
fore, since people go into jobs to earn money, with which
to buy things for themselves, they will get more money
by giving up hens and going in for pigs ; and then they
can buy more things for themselves, since they have
more money ; or they can save the extra money.

People will get, therefore, more money, if they take
on the jobs shown by the price movements which follow
after people's wants, than if they ignore those price
movements. Since people work largely for money,
this is another reason for getting the right jobs done,
and the right goods put on the Road of Production.

The money which people might* earn in this way by
keeping pigs or poultry is often called their Profits.
If the price of bacon goes up, we say that the Profits
of pig owners have increased.

It is these Profits, then, which guide men and women
into the jobs which provide for people's wants. We
can set up Profits as another sign-post between wants
and goods, thus :

Production of Goods. People's Wants.

WHAT PRICES AND PROFITS DO

SIGN-POSTS TO GUIDE US 151

The farmer decides whether to keep pigs or poultry
according to his profits, which will depend on the
movement of prices, brought about by people's wants.

We can see where the Profits sign-post can be set up
along the Road of Production :

Different People

have
Different Wants

shown by

Different Prices of Goods

which determine

The Profits

which guide

People into Different Jobs

to make
Different Goods and Services to fill those Wants.

You can see for yourselves where the new sign-post
would stand along the Road of Production, if you
start from the goods produced. It should not be very
difficult to place it on the right spot.

There is one more sign-post which we can still put
on the road.

Wages and Salaries.

Some of you may say : " How do the ordinary
workers know what jobs to take up ? They don't
work for profits. They work for wages and salaries.
The Profits sign-post can't be of any help to them."

That is quite true. Most people do not own
businesses of their own, whether farms or factories or
shops. They work for other people who own them,
or they work for the State, and they are paid Wages
and Salaries for their trouble. These wages are
usually fixed in some way before they take on the job.

Let us suppose that our skate-factory-owner finds
that his profits are increasing since the price of skates
has gone up. What will he do ? We saw that he

152

ECONOMY IN PRODUCTION

would increase his output of skates. To do this, how-
ever, he must have more workers. Now people ordin-
arily do not want to change their job, except for some
good reason. That reason may be (as we saw for the
Profit earners) an increase in the money which they
earn for their work.

Therefore, to get more workers for his factory, the
factory owner must offer higher wages to attract them
from some other job. This he can do, because he is
himself earning higher Profits, so he can afford to pay
out more in the form of higher wages to his workmen.
It is really just the same thing as when people want
bacon more than eggs ; they offer more money and give
higher prices for bacon. If factory owners want more
skate-makers than tennis-racquet-makers, they will
offer more money and give higher wages to skate-
makers.

Along the Road of Production, then, we can set up
one more sign-post. Starting from the goods pro-
duced we see :

/>

WAGES/

Goods ^Production-
Jobs

u\

PROFITS/

\

PRICES/

\

People's
Wants.

SIGN-POSTS TO GUIDE US 153

Sometimes, as when a man employs no workmen, but
does everything for himself, the wages sign-post is
left out. Such cases are doctors, some actors or
actresses, small farmers with their families, Punch and
Judy showmen, one-man shopkeepers, gipsies and so
on. Much more usually, however, some labour is
employed at a wage or a salary.

These are not the only sign-posts which help to guide
the right goods and services along to the right people,
but they are perhaps the most important.

Economy in our Working Time.

If you think back to Crusoe on his island, you will
see that the main problem is very much the same for
him as it is for all of us in our populated world.

Crusoe had to consider how to divide up his scarce
time in doing different things to satisfy his different
wants.

We have so far just considered what indications or
guides there are for showing us how to divide up the
total working part of our scarce time, that part of our
day which we all give to our jobs and for doing which
we earn money. When we divide up our working days,
as we can call them, so that the different jobs, which
we perform, produce the goods which satisfy our own
and other people's greatest wants, with the least
expense of time and labour, we are economising our
working days in the best way.

How we spend the other part of our scarce time, the
leisure and rest part, is a problem which our own minds
must settle for ourselves, just as Crusoe's mind did for
himself on his island.

Summary. Prices help to show what wants people
have. This helps to tell other people what to produce,
since they sell their goods for money prices and there-
fore get money to buy things to satisfy their own wants.

154 ECONOMY IN PRODUCTION

Prices of things will rise if people want those things
more than they did. People who produce those
things will make higher profits. Since people work for
money (as well as for enjoyment), they will move to
jobs where money profits are higher than before. Pro-
fits are earned by people who work on their own
account, or who employ labour. If employers need
more workers to work in their factories, they offer
higher wages to attract these men and women to their
jobs. When the working time of the total labour
supply of our populated world produces the things
which most satisfy people's wants, for the least expense
of that time and labour, then that scarce labour is
being best economised.

Written work. Either : (i) In the last ten years
people have wanted wireless sets very much more than
before that time. What signals have been set up on
the Road of Production so that these wireless sets could
be made to satisfy the wants of people ?

Or : (2) In the last ten years people have wanted
coal much less than formerly. What signals have
been set up on the Road of Production to prevent un-
needed coal being mined ? What effects has this had
on the coal miners ?

CHAPTER 18
A BEND IN THE ROAD

You must bear in mind what was said in Chapter 16
about people only being able to buy things with money,
and people working to earn money with which they can
buy the things that they want. It is not a quite true
statement. Some people get things by making them
for themselves, as a gardener grows his vegetables,
and some people work for love or for interest. But
what we have said is very nearly true. Most of the
things which we need, do have to be bought by us
from someone else with money.

Now we saw in Chapter 17, that when people
want things more than before, they offer more money
for those things, and the prices of those goods will rise.
Look back again at page 148, and see the price-balance
of bacon and eggs. The effect of the higher price of
one kind of goods is to encourage the greater production
of those particular goods and the smaller production
of something else.

We have now, however, to consider a very bad^bend
in our Road of Production.

Many people very often want more of some goods but
they have not got the money with which to buy it. The
want is there but not the money. Obviously, there-
fore, they cannot offer more money ; and so the price
of those goods cannot go up ; therefore the signs
cannot be sent down the road to encourage the pro-
duction of the things which they want.

Now that might not matter, if everybody had equal
wants, and had an equal amount of money to spend.

155

156 ECONOMY IN PRODUCTION

Because, if everyone thought wisely about how to
spend what money they did possess, you would get
just those prices that would cause the right goods to
be produced, considering scarce labour-force and scarce
goods to begin with.

Unequal Wants.

In the first place, however, everybody has not got
equal wants. Some people " want " things very much
more intensely than other people do. Their capacity
for, and power of enjoyment is not only different from
those of other people, but also actually greater. We
cannot know this for certain, as there is no yard-measure
or weighing scales by which we can compare people's
wants or enjoyments. From ordinary observation,
however, we can see that some people appear to have
a greater power of enjoying the ordinary things of this
life than other people have.

To get exactly the right goods produced and sent
along the road to the right people, we should need to
know what is the power of enjoyment of each person
(i.e., how much they really " want " things), and then,
if Mr. A wanted things in general more than Mrs. B,
then Mr. A should have more money to spend. It is
much the same as saying that, if one child is more
hungry than another, he should have more food given
to him. In that way, Mr. A would have more influence
on prices than Mrs. B, and there would be a greater
possibility of having the things produced which he
wants, than of having the things produced which Mrs.
B wants.

We cannot know, however, what powers of enjoy-
ment people have when they are compared with one
another. There is at present no means of measuring
how much one person wants something against how
much another person wants something. Think this
pver for yourself.

, A BEND IN THE ROAD 157

Unequal Spending -Power.

We must turn now to the second reason why prices
are not properly influenced or controlled by people's
wants. This is because everybody has unequal amounts
of money to spend, and we cannot say for certain that
those amounts are in proportion to their wants.

We have just seen that if Mr. A wants things more
than Mrs. B, it seems reasonable that he should have
more money than Mrs. B to spend. But if Mr. A wants
things only just as much as Mrs. B, it is reasonable to
suppose that they should have only just as much money
to spend. Then they will both have the same amount
of general influence on prices, and both will have the
same amount of influence on getting the things pro-
duced which each wants.

Here is a diagram which shows what I mean :

CASE I

HICH CAN

BE.
RODCICE

>\ONEY

BAG BAG WANTS

Mr. A and Mrs. B are trying to pull the goods to
themselves which they want. The sizes of their
figures show the sizes of their wants.

I have drawn Mr. A the same size as Mrs. B, because
they both want things as much as one another. The two
Z's represent their money-bags, which, in this case, are
the same size, because they also have equal amounts to
spend.

They are having a tug-of-war. They send their
wants to their money-bags, and their money-bags pull
at the goods which people can make, by influencing

158 ECONOMY IN PRODUCTION

the prices and profits and production jobs which I have
not shown, but which you will remember from Chapter
16.

It is the size of the money-bags which affects their
power to influence prices, and therefore to pull the
right goods to themselves, i.e., it is the money-bags
really which are having the tug-of-war, and not the figures
themselves.

This was quite a fair tug-of-war, because wants and
money-bags were equal in size on both sides.

However, if Mr. A wants things twice as much as
Mrs. B, then I can draw him twice as large, thus :

CASE 2

But since his money-bag is still the same size as Mrs.
B's money-bag, Mr. A has no more chance of satisfying
his greater wants than Mrs. B has. This is not such a
fair tug-of-war as the first case, and we do not get such
a desirable production of goods.

If Mr. A wants things more than Mrs. B, and has
more money to spend than she has, then we have this
state of affairs :

CASE 5

A BEND IN THE ROAD 159

Here, Mr. A's money-bag is larger than Mrs. B's, and
so he has more chance of pulling the goods he wants to
himself as compared with Mrs. B's chances. We can
say that this is a " fairer " tug-of-war again than Case 2.

i.e., Unequal Incomes*

Now, when we consider the money which people can
spend in our populated world, we notice at once how
enormously different are the sums of money which people
possess. Most people live on what is called their income
(see page 10) ; that is, the amount of money which they
receive during a certain length of time, a week, a month
or a year.

These incomes are vastly different in size.

There are some very rich people and some very poor
people ; and a great many " in-between " people,
whose money incomes are still very different from one
another's. You may consider 300 a year and 600
a year as both " in-between " incomes, but they are
certainly very different from one another.

Accordingly, the money-bags in our tug-of-wars only
show in a small degree the difference in size of the money
incomes which actually exist.

We certainly have no reason to believe that people's
wants are as different from one another as their real money-
bags. It may be true that rich people really " want "
or " need " things more than poor people ; though if I
were a rich man, I should be ashamed to admit it. It
may be true that poor people " want " things more
than rich people. It is impossible to say for certain
at present. Perhaps a day will come when we shall
know these things, but it has not dawned yet.

What we can be pretty sure of is, that we cannot
suppose that the size of the money-bags which people
at present possess is in proportion to their wants in
general, and that certainly nobody has yet proved that
this is so.

l6o ECONOMY IN PRODUCTION

We can see, then, a further possible condition for our
tug-of-war :

CASE

Mr. A and Mrs. B both have equal wants and are
drawn, therefore, the same size ; but Mr. A's money-bag
is far greater than Mrs. B's ; therefore Mr. A gets far
more goods produced for his wants than Mrs. B can.
Most people would agree that this is not good " econ-
omy." It means that Mr. A gets his large motor-car
(perhaps a " small " want) before Mrs. B gets her gas-
cooker in her kitchen (perhaps a " big " want).

You can think of other possible conditions of wants
and money-bags for yourselves. Perhaps Mr. A's
wants might be smaller than Mrs. B's, and yet his
money-bag might be bigger. This would be even
more unfair than Case 4.

Economy is Upset.

What will all this mean to our economy and scarce
time and scarce labour ?

Will it not mean that because the size of peoples
incomes is not in proportion to the size of their wants,
therefore the wrong kind of goods is then produced ?
Unless the size of money-bags equals the size of wants,
on both sides of the tug-of-war, goods may be made and
sent along the Road of Production to people whose
wants are much smaller than those of other people who
have great wants, but have little money with which to
satisfy them.

A BEND IN THE ROAD

161

It is not unlike an invasion of Crusoe's island by a
tribe of natives who forced our shipwrecked sailors to
spend their time and labour in collecting bright-looking
pebbles on the beach, instead of building huts and
catching fish for themselves.

All this comes about because the wrong signals are
put up on the Prices and Profits sign-posts. These
wrong signals are caused by prices following, not people s
wants, but people's wants permitted by the money they can
spend.

We can see how this bend may misdirect goods along
the Road of Production. Here is a plan of the Road
showing these bends :

WANTS OF
DJFFERCNT, I
PEOPLE Jl

pirfE&cNT

SIZES OF

DIFFERENT

1

DIFFERENT. DJFfERENT.DiFFEKENT. DIFFERENT

PEOPLES'

WANTS

PRICES NvAQES > JOBS
t OF GOODS $ PROFITS

> i
GOODS $

SERVICES
PRODUCED

DIFFER* NT SIZES
OF DIFFERENT
PEOPLES* INCOAXES

We can explain the diagram in this way : Different
people have wants which cannot be compared with
those of other people. These wants can only affect
prices through the money which they possess to fill the
wants. Only the wants allowed by the incomes will,
therefore, pass along the Road of Production.

Equal Incomes.

Could we say that a more " economical " set of goods
would be produced if everyone had equal incomes ?

Unfortunately we cannot say this for certain. The
reason, as explained on page 156, is that each person's
M

l62 ECONOMY IN PRODUCTION

wants are of different sizes from those of any other
person, and we cannot measure how different they
may be. Equal incomes might give us a situation like
that of the tug-of-war on page 158, Case 2.

Our system, in our populated world, is one which
tries to satisfy the wants of different people in so far
as they have the money to buy the things and services
for those wants. We can say that people should have
more equal incomes because we think that that would
be more right or more just or more pleasant ; but we
have no proof at present by which we can say for certain
that it would be more " economical " of our scarce
time or labour.

Although we cannot prove it, absolutely, we can say
that we do not think that at present we are getting the
most economical direction of our scarce time and labour,
when we consider how very unequal incomes are.
Hence there is a bend in the Road of Production. We
cannot straighten the bend completely till we can
measure the difference of people's feelings and wants.

Summary. Waste of scarce time, labour and goods
occurs because some people's desires for all goods are
greater than other people's, and there is no method of
measuring or knowing this. Consequently goods do
not necessarily get passed to the people in proportion
to their wants. Still more, since goods are bought with
money and not with wants, the fact that people have
unequal incomes makes it still more difficult to arrange
that goods pass to people in proportion to their wants.
We have no sure proof that more equal incomes would
mean a more " economical " use of our world's scarce
time and labour. If we decide to alter the size of
people's incomes so as to make them more equal, it
need not be because we think it more " economical "
(we cannot tell this), but because we think it is more

A BEND IN THE ROAD 163

desirable for some other reason, such as justice or
" fair play."

Written work. For what reasons, other than
considerations of economy, would you consider it desir-
able or not desirable that every family should have an
equal income ?

CHAPTER 19
THE MOUNTAIN ON THE WAY

Jobs again.

There is yet another great difficulty along our Road.

If you look again at page 152, you will see that goods
follow the jobs that produce them. The jobs either
follow the Profits sign-post directly, or they follow the
Wages sign-post which, in its turn, follows the Profits
one. When higher wages are offered for some jobs, we
saw that people turn into those jobs which offer them.
If lower wages are offered, they leave those jobs and
pass to the jobs which offer higher wages.

What we should have said, to be more accurate, was :
If higher wages are offered for jobs, people turn into
those jobs, if they can.

What does it mean to our Economy of Production,
if they can not do so ?

It means that the wants, which people have, cannot
be filled by the goods which will fill those wants.

Why?

Because we cannot get workers to produce or to make
those goods. The right signs may be sent all along our
Road, right up to the Wages sign-post. On this post
we hoist the sign asking for more workers to fill our
wants : i.e., the sign of higher wages.

Perhaps a crowd of workers comes up to look at the
sign-post. They see that they can earn higher wages,
if they can take the job. That would bring them in a
higher income, with which they could buy more goods
and services to satisfy their own wants. They would
be doing both themselves and the other people a good

164

THE MOUNTAIN ON THE WAY 165

service, if they do the work required. But they cannot
take the job. Therefore a break occurs in our Road of
Production. Our wants cannot, therefore, all be filled.

Can he Take the Job?

In order to be able to take a job which offers a higher
wage or a higher profit, a man must, of course, be able to
do the work. Not only must he have the will to do it,
but he must have either the brains or the physical
strength or some other quality which enables him to do
it.

Now when the workers come up to the Wages or
Profits sign-post, they may perhaps see a very high wage
offered for aeroplane flights to Australia, or for first-
class cinema actresses. Very few people, however,
have the nerve, skill and judgment to make a super
long-distance aeroplane navigator ; and very few have
the particular qualities which make a successful film
actress. Consequently the workers have to turn away
and go on with their old jobs, at the old lower wages,
and the people's wants for aeroplane flights to Australia
or for some kinds of film acting go very largely unsatis-
fied. " Very largely " not entirely because there
are a few people who can do those jobs, but not enough
by a very long way, to fill the public's wants. As
there are so few of these people, a very big notice must
be put on the sign-post, in the form of a very big wage,
in order to attract their attention ; otherwise some
other aeroplane company or film company would secure
their work instead.

Capacity.

Clearly, then, in order that jobs can respond to wages
or "profits " signals, people must have the capacity
to take the job. Having the capacity means having the
power to take a job.

l66 ECONOMY IN PRODUCTION

The capacities which are needed to help people to
take different jobs are shown on page 167 by a plan
of a mountain.

The higher you climb this mountain, the greater the
capacities or powers which you will need. The higher
you climb, the greater will be the wage which you will
earn.

What capacities or powers are required to climb this
mountain ?

If it were a real mountain, you would need a good
physique, a firm nerve, and a quick brain.

These are all qualities which will help anyone to
climb the Mountain of Capacity,^ as we may call it.
There are, however, other requirements as well, which
you may discover by studying the mountain.

On the left side of the mountain, at different levels,
are written those capacities which will help anyone to
climb up the mountain to that level.

On the right side of the mountain is shown whether
high or low or medium earnings can be got for the kind
of capacities shown on the left side.

On the mountain itself is shown the number of jobs
which can be filled at different stages and which corres-
pond to the kinds of capacities required.

We can think of many people starting at E. Their
object is to arrive at A, which is at the top of the
mountain, where they will earn the highest wage.
But very few people have the necessary capacities, so
that many people do not get farther than D. Some
reach C, and a few reach B. But only a very tiny
number ever reach A.

Also, it is sad to say, many people drop below E,
and a few even sink into the bog at F. At E people can
only earn just enough to keep them alive at
subsistence-level (see Chapter 2 again). At F, the bog,
they slowly and despairingly die.

If you read on the left side of the mountain the list

THEAOUNTAIN OF
CAPACITY

YOU MUST HAVE SOME AT

LEAST OF THESE CAPACITIES
TO ARR'lVE HERE

GREAT GIFTS- EXCELLENT
BRAINS, HARD WORK,GREAT
OPPORTUNITIES.

GOOD GIFTS. GOOD BRMNS
HARD WORK, GOOD
QPPORTUNITJES,
GOOD LUCK.

FAIR GIFTS, FAJR

&KAJMS, HARD WORK,

FAIR OPPORTUNITY

f AIR LUCK. J QUITE A LOT OF

JOSS CAN BE FILLED^

ORDINARY GIFTS. " ^ ^
ORoiNAtVf OPPORTUNITIES
HARD WORK* /
XllMS

VERY HIGH EARNINGS

ONLY VERY FEW JOBS
CAN BE FILLED HERE.

HIGH EARNINGS

NOT /V\ANY JOBS
CA1SI BE FILLED HERE

ORDINARY BRAl

POOH OPPORTUNITIES .
POOR QIFTS^NO LUCK,
POOR WORK.

SUBSISTENCE

A\EDIUA\
EARNINGS

ORDINARY
CARNiNCS

A GREAT /^\ANY
ARE FILLED HERE

FAR TOO
JOBS ARE FILL
E.B HERE:

to
o

1

<

IU

TO ARRIVE HERE
YOU MUST SUFFER
FROM EITHE.R:-

ILL HEALTH- LXajlME

NO OPPORTUNITIES.

DISHONESTY-

ItL UUCK-

BAD JUDGMENT-

l68 ECONOMY IN PRODUCTION

of capacities required for men to reach each level of
the mountain, they should be fairly clear.

Personal Gifts.

Good brains, good personal gifts (such as a strong
body, a courageous spirit or a sense of humour) and
hard work are qualities which everyone can under-
stand.

Without intelligence, health, courage and industry,
it is impossible to win success in a job, though a man of
ordinary powers can become a clerk, a secretary, a
shop assistant or a labourer. Without any of these
powers, a man would probably drop to subsistence-level
earnings, at the bottom of the mountain, or even fall
into the bog below it.

Opportunity.

What is meant by opportunity ?

Great opportunity, as you will see, helps us to reach
the top of the mountain, and thus to take the jobs
which offer the highest earnings.

Opportunity means the chance you may possess of
securing good education, or good training, of meeting
influential friends who will recommend you for jobs,
or of waiting till the one job which you want turns
up.

People very often do not differ so very much in the
strength of their bodies, or in the cleverness of their
minds. But they differ a great deal in the chances
which they have of developing these powers. Clever
boys of poor parents do not get the same chance of
learning to use their minds and bodies which clever
boys of rich parents possess. Often, they cannot go
to school for as long, even though the State does a
lot to help them with free education and with scholar-
ships. Their opportunities, therefore, differ. Some are
greater than others. A boy who must earn a living at

THE MOUNTAIN ON THE WAY 169

14 and who can only study at night is obviously not
so well fitted to take a job requiring learning later in
life, as a boy who can stay at school till 19.

A girl who, while still at school, has to spend her
evenings and week-ends in helping her mother to cook
and to wash, and to mind her younger brothers and
sisters, has not the same opportunity to do well at
school as a girl who can spend all her free time in
games, fresh air, extra study or in good fun. Conse-
quently, when she grows up, she will be less fitted to
take a good job not because she may not be so clever
originally, but because she has not had the opportunity
to develop her cleverness. She may have to become a
cook, instead of a lady-doctor. What she can earn
as a cook is much less than what she might have earned
as a lady-doctor. She cannot climb so far up the
Mountain of Capacity as others, because of her lack of
opportunity.

Furthermore, what the public may have wanted were
perhaps the services of lady-doctors, rather than those of
cooks. They showed this by putting up the signal of
higher prices or higher wages for lady-doctors than for
cooks. But as there were not enough girls who had
both the brains and the opportunity to become lady-
doctors, the jobs could not properly be filled. Conse-
quently, the signal was not taken off the sign-post,
and the wages or earnings offered for lady-doctors
remained high. Those few who could become doctors
received these high earnings. If our girl who became a
cook had had the right opportunity (let us suppose she
was clever and hard-working also), she could have
become a doctor, too, and the public's wants would
have been better satisfied by her doing so.

There is another difference in opportunity, caused
by the possession of different amounts of money.

If two boys grow up more or less equal in brains,
body, capacity for hard work and in education an4

170 ECONOMY IN PRODUCTION

training too, it may still be easier for one boy, who has
more money than the other, to climb higher up the
Mountain. His money will prove an extra capacity.
For instance, the money may enable him to travel
about the world and to visit different countries or differ-
ent cities, until he finds just the very post for which he
is fitted. Or, his money may bring him more into
touch with people who are also rich and who, being rich,
often have the power to give jobs to people. These
people, knowing him, are more likely to give it to him
than to the other lad, who is not known to them.

Or again, one boy, having money and having finished
his training, need not take the first job that offers
itself. He can wait and look about until a really good
one turns up. The other boy, with just as good per-
sonal qualities, but having no money, must take the
first job, in order to earn a living or to help his relations
at once. He may, if he is lucky, see the better job
when it is advertised, apply for it, and get it, but he is
very likely not to notice it, having just started work
himself. Or he may think, having already started,
that he had better not risk making a change.

In all these ways, opportunity causes a great differ-
ence in people's capacity to take the jobs for which
they may be suited.

Luck.

Lastly, there is Luck. What is good luck or bad
luck ? Frankly I do not know. Does it really exist ?
I think so, but I have never quite made up my mind.
I rather believe, however, that some people do manage,
through no apparent effort on their part, always to be
on the right spot at the right moment. They are the
men or women who catch the manager's eye when he is
in a good mood, and when he is vaguely looking for
someone to manage a new department. The unlucky
ones are those who catch a heavy cold just before an

THE MOUNTAIN ON THE WAY 171

important interview, or during an important examina-
tion, and who feel heavy and stupid, therefore, instead
of bright and intelligent.

Wasted Labour . . .

What is the result of this inequality of opportunity
to take jobs ?

Actually it prevents people from entering those jobs
for which they are most fitted. The man who could have
been a splendid architect now has to become a gas-
plumber. His real services are lost in our populated
world, because his work as an architect was more
required by the world than his work as a gas-plumber.
That is because an architect's work requires more
unusual powers of mind and artistic judgment and
observation than a gas-plumber's, and so there are fewer
people who have those powers.

If you think back to the picture on page 119, on the
desert island, you will see that each man was placed
finally on the job for which he was best suited. Sup-
posing, however, that Ted (who was the carpenter)
had been very poor, and had not been able to undergo
the expense of apprenticeship to learn his trade, he
might have become just a newspaper boy, then an
errand boy, and finally an ordinary labourer. His skill
as a carpenter would have been lost to the world, and
our island would have suffered by not having its huts
well built. We can say, then, that that would have
been a worse division of labour. The carpenter would
have become a labourer ; his real gifts, his best labour,
would have been wasted.

A good Division of Labour not only puts people
already trained in the jobs for which they are best
fitted, but it sees that everyone gets the right training
and the right opportunity to do the job which suits
them best. We have seen that this is often not the
case in our world.

172 ECONOMY IN PRODUCTION

A good division of scarce labour must give equal oppor-
tunities to all men and women, so that each one's special
gifts can be set to work on the right jobs.

. . . causes Unsatisfied Wants.

Below, you will see once again a part of our
Road of Production. I have not put it all in, as it is
getting so long. You can make a complete one for
yourself. The Road now has to pass over the Mountain
of Capacity. Only those wants can be filled which

FR9AV DIFFERENT DIFFERENT/
^ ,

KVCES WfcGtTV, C JL TTY / JOBS GOODS AND
WANTS OF COOLS PROFITS < > /MV ^ l V SERVICES

PRODUCED

THE BOO OF FAILURE

can meet people on the other side able to do the jobs
for them. And only those people can do the jobs to
fill those wants, who have the capacity to climb some
part of the way up the Mountain. Some wants, like
coal and cleaning, cooking and digging, find many
people more or less capable of meeting the occasion.
Other wants, like operatic singers, great business
organisers, or managers of railways, find very few
people able to fulfil them. Therefore, most of the coal
wants are filled, but not many of the business-organising
wants.

THE MOUNTAIN ON THE WAY 173

The problem for our world is to find the right person
to do the right job, and then to give him as good a
chance as anyone else of doing it.

Summary. The satisfaction of wants in the most
economical way is hindered by the lack of power of
individuals to take jobs which will make goods or
services to satisfy people's wants. This may be due to
lack of capacity or power to do a job. The capacity
to take a job will be given by good personal gifts, hard
work, good opportunities and good luck. It is very
seldom that anyone has all these qualities at the same
time. As such people are very scarce, they get a very
high wage paid them for their work. Differences in
opportunity occur owing to differences in education
and training when young, due to families having
unequal incomes. Hence, gifted individuals often have
to undertake poor work. This actually leads to an
uneconomic division of our scarce labour.

Written work. Can you suggest any ways in
which you think people might be given more equal
opportunities of training for jobs, than they have at
present ?

CHAPTER 20
THE RULES OF THE ROAD

So far, we have seen that the purpose of the Road of
Production in our populated world is to link up people's
wants with the goods and services, which satisfy these
wants.

The object of economy is to use as little as possible
of people's scarce time, labour and goods in satisfying
the wants. We must, therefore, avoid waste. But, in
order to keep the goods and services moving easily
along the Road towards the wants, however, we must
have certain Rules of the Road.

On the desert island, Crusoe and his fellow-men
discovered that they must make certain agreements in
order to economise their time and labour and goods
more satisfactorily (Chapter 15). They decided to
make certain goods the private property of certain
people ; to share certain kinds of work and goods
among themselves ; to uphold agreements once made
between one another ; and to hold general meetings
for discussion, for making rules, and, if necessary, for
meting out punishment to offenders. By doing these
things they avoided many kinds of wasteful actions
and behaviour.

In our populated world, we make exactly the same
kind of arrangements.

Private Individual Property

In the first place, we live, in England, in such a way
that any single person is permitted to have certain

RULES OF THE ROAD 175

things for himself, and nobody else may take, use or
harm those things. This is called owning Private
Individual Property. It is possible to own anything
from a castle to a mouse-trap. Some people own a
vast amount of things, and some only own the clothes
in which they stand. No one else, however, may
interfere in any way with anything that is " owned "
by another person.

In this way, many wasteful deeds are prevented, since
people are enabled to use their property in the way
that suits them best. In other words, they can use
their property in the way that satisfies their wants most
satisfactorily.

This can be seen in a number of ways.

Safeguards the Future,

If a man were to grow a sackful of potatoes, and any
other man, who desired, could take those potatoes away
from him, nobody, in the end, would take the trouble
to lay up a store of things. People's wants for the future
would not then be satisfied (see Chapters 3 and 12).
Nearly everything made or grown would be consumed
on the spot lest anyone else should take it away from
the grower or maker of the thing.

Avoids Waste,

Very likely it would be even worse than this. For
instance, you might be growing some tomatoes in a
frame. Just when they were ripe, you might decide
that you would pick them for the next day's dinner.
But in the night, if you had no rights over your own
property, someone else, with an eye on your tomatoes,
might come and take them for himself. The next
time when you grew them, you would probably pick
those tomatoes just before they were ripe in order to
make sure of getting them. Other people would, no
doubt, cut their cauliflowers before they were fully

176 ECONOMY IN PRODUCTION

grown. Farmers might get in their harvest before the
corn was quite ready. Everybody would have to eat
lamb and veal, because it would be unsafe to keep
your animals until they were old enough to be mutton
or beef. Someone else might take them then instead
of yourself. In this way much waste would occur,
since we do not want unripe tomatoes, or ungrown
cauliflowers, and we cannot afford all lamb and veal.

and helps Production.

In fact, after a time, it is difficult to see how pro-
ductive work could go on without private property
of some kind, since it would discourage people from
making anything more than they could use immediately,
since they would fear that it might be taken away from
them as soon as it was made.

We saw that Ted was faced with this problem on the
island, when people used his sawn-up timber lengths
for fuel, without asking his permission. He said that
if it went on, he would not cut any more lengths at
all. (See Chapter 15.)

Everybody's Property.

Consequently, in our world, we allow people to own
property. Some property, however, is owned not by
individuals but by everybody together. We usually
say then that the State or the Town or the Village owns
the property. This is quite different from the state of
affairs in which nobody owns it. Nobody " owns "
the sea (because there is so much of it) , and anyone can
get a bucketful of water from the sea for himself if he
wishes. Everybody in England " owns " the roads,
but that does not mean that you can dig up a lump of
pavement and use it for your garden rockery. When
the State or the Town " own " anything they arrange
special rules for the use of that thing, and they pay special

RULES OF THE ROAD 177

men or women to see that those rules are carried out.
We shall consider this again.

In the meantime, we can think of Private Property,
whether owned by one individual or by many persons
together, as being a method of controlling production
and life, in order to assist us to avoid waste and to help
us to economise more fully.

Private property is like a Policeman who shows the
traffic (our work and labour) which way to pass along
the road. The Policeman prevents the traffic from
straying about in the wrong way, and blocking the
most economic satisfaction of our wants.

Grouping Ourselves Together.

We can next consider the arrangements, in our
populated world, by which we agree to do certain things
in common together.

For this we combine together in certain groups, or
bodies of people. The most important of these, perhaps,
is called the State. There are, nevertheless, many
other kinds of groups of people such as the Town or
Borough, the County, and the Village or Parish. Some-
times they may be groups of workers called Trade
Unions ; or groups of Employers called Federations ;
or groups of religious-minded people called a Church.
You may be able to think of other kinds of groups of
people as well.

These groups are not formed with the idea of assist-
ing economy necessarily, but they all play some part
in so doing.

The State.

Let us consider the group called the State, so that we
can understand better how this economy is helped on
by the groups.

If you look back at Chapter 15, you will remember
that when Robinson Crusoe and his friends wanted

N

178 ECONOMY IN PRODUCTION

to make rules among themselves, they all met together
to discuss matters, so that they could all come to a
common agreement.

In Great Britain, there are roughly about 46 million
inhabitants, so it is impossible for everyone to meet
together in order to talk things over.

Government by the People.

Therefore people in different small districts arrange
to appoint one man or woman to represent the general
point of view or opinion of the people of their district.
Every few years they vote for this person, and the one
who is chosen by the greatest number of votes is sent to
London to the House of Commons, to meet the other
representatives from other districts. These people are
called Members of Parliament. All the Members of
Parliament can then meet in one large hall to discuss
the things which ought to be done. They put forward
the opinions of the people who have chosen them, and
they arrange how the land is to be governed.

This is called a Democratic System of Government,
because it depends in the first place on the will of the
people who vote for the Members of Parliament. The
State is controlled by the Government, which is itself
controlled by the people of the land. When the State
makes a law or a regulation, it is, in the long run, the
majority of the people who are making that law or
decision through their representatives.

How does this group called the State help people to live
and to work more economically in our world than they
could without the State ?

There are many ways in which this comes about.

The State Protects Private Property.

Firstly, just as the men decided on the island (see
Chapter 15) the State arranges what measures must
be taken to protect individuals' private property, and

RULES OF THE ROAD 179

what punishments must be given to those people who
break the laws or regulations concerning private
property.

In other words the State upholds laws and keeps order,
so that people can work in peace, and can own their
property without wrong interference from others. To
do this it employs the Police to prevent or to catch
offenders ; it sets up Courts of Law to judge accused
people and it arranges for juries to decide whether the
accused are guilty or innocent.

Owns Property,

Secondly, the State owns property itself, and it performs
many jobs which otherwise would not be done, or would
not be done sufficiently well by individuals working for
profit.

We saw that when the men on the island wanted their
fresh water stream to flow past their huts, they all went
together to help in digging the ground. This was
because it would have been too big a job for one person
to have done by himself, and because they were all
going to benefit by the result of their work. When the
work was finished, therefore, it " belonged " to them
all.

If you consider the world in which you live, there are
a great many things which have been made by the State.

This does not mean that all the 46,000,000 inhabitants
have helped to make them. It means that these things
have been made by people paid by the State. The money
to pay these people, however, comes from taxes, which
in some form or other are paid by nearly everyone in
the State. Therefore we can say that the things are
made by the State in the sense that the State pays for
them.

This property owned by the State includes such things
as bridges, roads, museums, post offices, the electric
" grid " system, London's transport and schools. There

180 ECONOMY IN PRODUCTION

are a great many other things so owned, and you could
give yourself five minutes or so to write down as many
more things owned by the State as you can think of in
that time.

Not only does the State own and make this property,
but it also carries on many kinds of work.

and Carries Out Jobs,

It may do the kinds of jobs which are of so great
importance that they cannot be left safely to individuals
to perform them, lest the jobs are not properly carried
out.

Examples of this kind of work are :

%

The preservation of order.
The defence of the country.
The care of the roads.
The care of the water system.
The care of the drains.
Post office work.
Education of children.
General health work.

If all these things were not properly carried on you
can imagine the confusion and difficulties that would
arise.

in a More Economical Way than Individuals.

Sometimes, the State performs jobs which can only be
run economically if they are controlled from one centre.
It was found that the traffic in London was becoming
so great that it was easier to avoid muddle and traffic
blocks, and, consequently, loss of time and labour,
if one central body controlled it all. Before then,
separate companies had worked buses, or trams, or
different sections of the Underground Railways. Once
a central body was formed, called London Transport,

RULES OF THE ROAD l8l

the State felt that its power over London's traffic, and
therefore over the people of London who use that
traffic, was so great that no single person or company
should be allowed to own or to work that transport.
Therefore the State decided that everybody should own
it, and so London's transport became State Property.

You will remember that on the island the fish-pond
was made Jack's property, and the coconut trees were
given to Bill so that they could look after the property.
In this way they were able to see that the goods were
not wastefully used. In the discussion on this, some of
the men suggested that Jack might use the pond waste-
fully in his own interests.

Should the State Own More Property still?

Many people to-day think that the State should own
more property than it actually does. They say that
some forms of property are not used in the most econ-
omical way by the people who own them, when the
State as a whole is considered. That is, just as you
could not allow people to own the roads, and to close
them if they wanted, so people should not be allowed to
own coal-mines and work them wastefully so that the
coal is made unnecessarily difficult to get in the future.
Or again, they say that private people should not own
land, since it is so necessary for the general well-being
of everybody. Therefore, these people suggest that
the State should own more property than it does, so
that it can protect everyone against waste which may
occur by private individuals owning it.

At the beginning of this chapter, we saw that private
individual property as a whole does prevent waste.
We must, however, admit that in some case State
Ownership of Property may avoid waste more fully
than individual ownership. It is a very difficult
question to decide just where private ownership of
property becomes harmful, but it is a problem which is

l82 ECONOMY IN PRODUCTION

causing much thought in all countries of the world
to-day. When people suggest the Nationalisation of the
Railways, or of the Coal-mines, they are advising that
the railways or the coal-mines should be owned by every-
one together, instead of by individuals or small groups of
individuals.

There is another important work carried out by the
State besides protecting property, owning property and
carrying out jobs.

The State Protects Agreements.

The State also must see that agreements made between
individuals are carried out. This was the point which
Fred raised on the island (see Chapter 15).

For instance, what is to be done about people who
agree to give a certain sum of money for a certain
piece of work or for a certain amount of goods, and
who afterwards refuse to pay up ?

When a greengrocer arranges to buy a dozen baskets
of strawberries, he naturally does not pay for them
until they are delivered. In order to make sure of
getting the strawberries, he may give an order to the
farmer some three months or more before they are ripe.
What can the farmer do if, after he has sent the straw-
berries, the greengrocer refuses to pay him for them ?

The arrangement, in our world to-day, is that when
two men are making an agreement about buying or
selling anything, whether goods or labour, they should
write on paper the terms of the agreement, and then
sign it with their names. This is known as a Contract.
If either of them breaks the agreement, the other can
take the contract to a Court of Law, and ask the Judge
to insist that it is properly carried out. If the case
is proved in his favour, the Judge will make an order
that the offender must give up enough of his money
to make the contract good.

What has this to do with Economy ?

184 ECONOMY IN PRODUCTION

Contracts Give Confidence and Security to Work.

Goods are made by people and exchanged with those
made by other people in order to satisfy wants with the
best division of scarce labour. This gives us the best
economy of our scarce labour (see Chapter 14). But
goods can only be made in this way, and exchanged
in this fashion, if people have faith, and feel security that
their agreements together will be honestly carried out.

If a man agrees to make a pair of shoes in exchange
for 100 cabbages, and then only is given 60 cabbages
for his pair of shoes, he will not work and exchange
his goods with that man again. If it happened many
times, he would prefer instead to make his own shoes
and to grow only just enough cabbages for himself.
If this took place, eventually there would no longer be
any division of labour, and much skill and effort would
be wasted. (See Chapter 13.)

Consequently, since men know that their contracts
can and will be upheld in the Law Courts, by the State,
confidence and faith exist among them to carry on
their work, to make agreements together and to divide
their labour in the most economic way among them-
selves.

The State, therefore, acts as a second policeman along
the Road of Production. It is the State who makes it
possible for private property to exist. You can, there-
fore, think of the State as a police inspector and of
private property as an ordinary constable.

Summary. In order that the satisfaction of wants
should proceed easily along the Road of Production,
it is necessary that certain Rules of the Road should be
laid down and kept. There are two chief traffic con-
trollers along the road, who act as Policemen to see that
these rules are not broken. The first is Private Individ-
ual Property, which prevents waste of labour and goods,
encourages production of goods and services to satisfy

RULES OF THE ROAD 185

our wants, and helps to safeguard our future wants.
The second is the State, which protects private pro-
perty, enforces law and order, owns property which
everyone needs but which cannot be allowed to
belong to individuals, carries out jobs which are
too difficult or too important to allow individuals
to do, or which can be done more economically
(i.e., with less time, labour and goods) by one
authority than by a number of smaller ones. Lastly
the State insists on contracts or agreements being
carried out, and so it gives confidence and security to
people, without which they would be unwilling to work
together.

Written work. Either : (i) Make a list of :

(a) Any property owned by the National Government
or by the Local Government in your neighbourhood.

(b) Any jobs paid by the National Government or the
Local Government in your neighbourhood.

Or : (2) Write an imaginary account of what
happened as a result of one of the following situa-
tions :

(a) The Government sent all its police on a week's

holiday.

(b) The Government closed its schools for seven

years.

(c) The Government sold its roads and bridges to a

private company.

(d) The Government decided not to employ any

dustmen or road sweepers.

(e) The Government refused to enforce any contracts

in its Courts of Law.

CHAPTER 21
THE " ROAD " BECOMES A " RAILROAD "

WE have now nearly finished our enquiry as to how
our populated world economises in producing things to
satisfy people's wants (see Chapter 16).

Saving Again.

Just when our council of rescued mariners thought
they had set down as many points as they could suggest,
one of them said :

" On our island, we used to make a store, and it
helped us in a good many ways, to produce things.
How about this store in our populated world ? Who
makes it, and how does it help everybody ? "

This question raised a good deal more discussion,
till, finally, they all arrived at something like these
general conclusions on the matter.

Making a store, they remembered, was really the same
as providing for the future in some way (see page 100).
This had been called saving, and could either come
about by working definitely to make something which
would be " stored-up," or by not consuming (not
spending) what they had already got.

The results of saving (see Chapter 12) were :

1. It made their future more secure.

2. It saved time and trouble in making or doing
things later on.

3. They could make new and different things by
means of the store.

4. They could make useful tools. These tools in

186

THE " ROAD " BECOMES A " RAILROAD " 187

their turn helped to save time, to save trouble, to give
them more than before, and to give them new things.

As their time and labour and things were limited on
the island, they had to weigh up, in their minds, how
much they wanted to have now, and how much they
wanted in the future. Then they had to economise
that time and labour and those things, between using
them for now and using them for the future. That is,
they had to use them in the way which satisfied their
wants during a period of time most fully.

Saving by People.

First of all, then, how does our populated world " save "
at all ?

Just as happened on the island, part of the work,
which people do, is done not to give them things or
money now, but to give them things or money in the
future. Also part of the things or money which people
already have is not spent, but is set aside, so that they
can have it later on.

Who does this saving ?

First of all, it is done by ordinary everyday people
like ourselves. They set aside part of their incomes
(see page 22). They do this in many ways. They can
do it by putting their money into the Post Office Savings
Banks, who look after it for them, or by putting it into
Banks, who sometimes give them something for it, and
in their turn lend it over to other people who want
money now ; or by buying Shares in companies who
pay them what is called interest or dividends for the
loan. When individuals save, it means they have less
now to spend ; but they will have more to spend in
the future.

Saving by Companies.

Secondly, saving is done by groups or bodies of
people. Such bodies are often called Companies.

l88 ECONOMY IN PRODUCTION

Perhaps they may be railway companies. Every day
the companies are paid money by people who use
their trains. The companies use some of this money
to keep up their lines in good order ; to replace machin-
ery or trains which are wearing out ; or to make new
and faster trains or to electrify old steam lines. When
the companies do this, they are saving ; they are pro-
viding for the future of their railways. If they did not
save, their trains later on would run more slowly or
have more accidents.

Saving by the State.

Thirdly, saving is carried out by a great group of
all people together, whom we Qall the State or the
Government or the Local Authority. The State raises
money by taxing people. A part of the people's money
is taxed or taken now by the State, who use it to make
things which will be useful for everyone, or nearly
everyone, later on. Such things may be schools, or
roads, or harbours, or bridges. It means that people
have less money to spend now (because some is taken
away now by the tax), but they or their children will
later on be able to enjoy the better education, the easier
traffic, or the better communications which the State
will provide.

How Saving Helps.

In what ways does this saving help our populated world?

Firstly, it makes our life in the future more secure.
If we had no great warehouses filled with food and raw
materials, a sudden drought or a foreign war might cut
off our supplies of those goods ; and we might starve
before we could find a new source from which to get
them.

Secondly, just as on our desert island, the saving
helps us to have new and different things. Because a
certain amount of food and goods (or, in our world, the
money to buy those things) is set aside and not eaten

THE " ROAD " BECOMES A " RAILROAD " 189

up or spent, it can be used to keep people specially for
inventing things (just as Crusoe was kept by his friends,
see page 124). Companies or Governments often pay
scientists and discoverers to invent new and better
ways of doing or making things. Museums and
hospitals and town councils pay learned men to make
experiments for them. Sometimes people save up
money for themselves, and spend it in trying to discover
things just for the joy of discovery.

The money spent by companies, or hospitals, or
individuals, or by any other person or institution, on
invention, means they have less to spend on other
things now, but they feel it is worth ,hile taking the
risk, since the new invention may be something of great
value for the present.

Among such new and different things as have resulted
from this saving are, of course, aeroplanes, anaesthetics,
sewing machines, wireless broadcasting, cinemas and
telephones. In fact, if you look round your homes,
there is really nothing which is not the result of saving
and invention on somebody's part, either recently or
thousands of years ago.

Thirdly, saving gives us not only things to enjoy in
the future, but things to work with in the future.
Useful tools and machines. Many new things made we
enjoy directly, like broadcasting. But many new
things we do not exactly enjoy in this way, as, for
instance, an electric magneto. But an electric magneto
helps us to do things, and to produce things more easily
than before. A machine for spinning cotton or woollen
yarn ; or for printing newspapers ; or for breaking up
roads, will save us time or trouble or will give us a great
deal more of what we had before.

Economy in Saving again.

Now, if our families saved every penny of their
incomes now, and lived at a bare subsistence-level, in

ECONOMY IN PRODUCTION

order to enjoy their money at some date in the future,
our health and powers of enjoynent, and that of our
children might be so injured, that neither we nor our
children might get any satisfaction out of the saved
money, even in the future. Too much saving would
have been carried out, and this saving would be wasted
in its real purpose.

If the State decides to build too many bridges, or
schools, or to clean up too many harbours or rivers,
they will have to take a very great deal from people's
incomes now in taxes. So much, in fact, that people
will have very little to spend now. Then they may feel
that their enjoyment of these schools, rivers and docks
later on will not really be worth* their having so little
to spend in the present. The State has saved too much.

If companies spend too much money now, on setting
up new machines, new factories, or new railway lines,
people will get tired of waiting till these machines and
factories turn out goods which they can enjoy, and they
may finally refuse to buy these machines and factories,
and spend their money on things to eat and drink and
wear instead. Then the machines and factories,
which the companies have made, lie idle and unwanted.
This is again because too much saving has been done,
and the results of it are wasted.

On the other hand, if everybody spent all their
income now, old age will come and find them penniless ;
if the State makes no provision for the future, new
children will be born who will have no schools to which
to go. If companies make no provision for the future,
railway lines will wear out, and become dangerous,
and factories will fall down through lack of repair.

Just as Crusoe and his mates had to strike a right
balance between spending in the present and saving
(which is really spending in the future), so we in our
populated world must do the same. It is our wants,
our needs, our desire for things now ; and our wants

THE " ROAD " BECOMES A " RAILROAD "

and needs and desires for things in the future, which tell
us how much spending to do now, and how much saving
to do now.

Like Crusoe, then, once having decided how much
spending and how much saving we think we want, we
must economise our scarce time and labour and money,
so that we do not spend too much now and have too
little later on, and do not spend too little now and have
more than we can properly enjoy later on. That is,
as we have seen, we must economise our scarce time,
labour or money during time.

Quicker Satisfaction of our Wants.

Lastly, how does this saving affect our Road of Pro-
duction ?

Actually it does something which seems to change the
road into a railway line.

The railway line helps to join up people's wants to
the goods which satisfy those wants vastly more quickly
than the old road did.

Just as railways in real life increase the speed with
which people or goods can pass from one place to
another, so inventions, useful tools and factories, which
result from saving, permit goods and services to be sent
to people's wants more quickly and more cheaply.

These wants may, of course, be the desire for music
in the home, easy transport, good education or tinned
food. If the people want something, saving, leading to
inventions and so to new machinery, helps those wants
to be satisfied in the future more quickly than if there
had been no saving.

Signs on the New Road.

What of the sign-posts which we saw are put up along
the road to guide Production ?

We do not know exactly what signs will be required
when saving takes place, and when inventions and new

192 ECONOMY IN PRODUCTION

machinery occur. Instead of higher prices, higher
profits and higher wages having to be hoisted on to the
sign-posts, the invention may come along and give
people what they want for lower prices. This is because
the things can now be made more quickly and more
easily because of the machinery or the invention.
Therefore it costs less in time or labour or money to
make these things.

One of the most obvious examples of this is the fall
in the price of motor-cars in recent years. This fall
has come about, not because people do not want motor-
cars so much as before but because new inventions
are constantly being made to produce cars more easily.

This naturally pleases people very much because, if
motor-cars are cheaper, they have more money left
after buying one, to spend on satisfying their other
wants.

Saving, therefore, which leads to inventions and to
useful tools and to machinery changes the speed along
which goods and wants pass to one another along the
Road of Production. As this happens, different and
often lower prices are set up on the sign-posts, and this
will make for different profit signs and different wage
signs. It is a very difficult problem to say whether
higher or lower profits or higher or lower wages will be
the result of the saving.

Where do " More Goods " come from ?

Now we are in a position to give some answer to our
question in Chapter 9 on page 80. Where can we look
for the real Aladdin's Lamp, which will help us to have
more goods and services than before with which to satisfy
our wants ?

We saw in Part I, Chapters 6 and 7, that more
money alone only raised the prices of goods and
services. At the end of Chapter 9 we saw that the

THE ROAD BECOMES A RAILROAD 193

River of Production of goods and services depended upon
the efforts, bodies, minds and good sense of those people
who help to feed it.

These people can increase their production, firstly,
by dividing up their scarce time, so as to give more
time to the working part of their day (see page 95). But
if they do this, it means, of course, that the leisure
part of their day will have to be smaller.

It is of the utmost importance to remember here
what are the really important things in life. Goods and
services of all kinds are extremely necessary, especially
to those people who have very little of them. But
good health, games, singing and knowledge, bathing
in sea or river, friendship and walks in the country,
laughter and dancing, hobbies and crafts are extremely
necessary also.

If we give up more of our leisure time to gain more
goods and services, we may have to give up many of
these other things too, since many of them can only be
got in our leisure time.

We have to ask ourselves whether it is really worth
while doing so.

Secondly people can increase their production by
setting more men and women on to invent things with
which to work. To do this, saving must be carried out
in some form, so that the inventors can have money to
live on while occupied in their work. (See pages 104,
123 and 189.)

Thirdly, we can have more goods and services by
saving up and making useful tools and machines with
which to work. These machines save time and labour,
and give us far more than we had before. (See pages
105, 106 and 189.)

In saving to help invention, as in saving to help make

useful tools, etc., we must give up having or enjoying

things now 9 in order to have more in the future. Or, we

must work harder or longer now in order to have more

o

194 ECONOMY IN PRODUCTION

in the future. In that case, we have to give up part of
our leisure time now.

Lastly, we can have more by arranging our scarce
time and labour in ways that use it most efficiently,
or that reduce waste. This is really a kind of inven-
tion the invention of a. good organisation of Production.
In Chapters 13, 17, 18 and 19, we saw some
of the ways in which waste occurred. In Chapter 19
we saw that more equal opportunities for everyone would
give us a better division of our scarce labour. That would
mean that the same amount of time and effort spent
in working would satisfy more of our wants than before.

In Chapter 20, we saw that we can only go on work-
ing to satisfy our own and other people's wants if we
made certain agreements, rules and laws affecting our
conduct with one another. We have to set aside some
of our scarce property and labour to uphold those rules ;
but we do so to avoid wasting much more of that scarce
property and labour, which would happen if there were
no rules and no one to enforce those rules.

When we work longer or more vigorously, or when we
save for machines or invention, we have to give up
either part of our leisure time now, or part of our
enjoyment of goods and services now.

So the real Aladdin's Lamp, which consists of more
work, more invention, more machines and better
organisation (a kind of invention) has to be paid for,
after all. We pay for it when we give up our leisure or
our present consumption of things. The Lamp shines
so that we can see our way to having more goods and
more services, but we must provide the will to walk on
down that way, if we want more of those goods. And,
if we decide to do so, we must be careful not to give up
something really more precious.

One of our " wants," for instance, may be to work in
pleasant cheerful surroundings at a good, steady rate,
but not under undue strain, and not at too intense a

THE " ROAD " BECOMES A " RAILROAD ' 195

speed. If we wish to have more of all kinds of goods,
it may be possible, perhaps, to have them, only by using
machinery at such a speed that men and women can
find no happiness in their work, and no strength to
enjoy their life outside their work. We must then
choose (see Chapter i) which of our wants is the greater.
More goods or better conditions of work ? It may be
possible one day, with further inventions, to have both
these desires, but at present it seems that we must
choose between them.

The Road of To-morrow.

If we think of the Road of Production to-day as a
railroad, owing to all these new inventions constantly
occurring, how shall we think of the Road of Production
of the Future ?

Will it not resemble something like a Great Airway ?
(See page 196.) As long as people's bodies and brains
still remain keen and active, new inventions and new
machines will yet be made to bring people's wants ever
more swiftly to their goods.

If we know what we want, then the more easily and
the more simply we satisfy those wants, the better
have we economised our scarce time and scarce labour
and scarce things.

Remember that, whatever we do, economy should
play its part. Whether we spend, whether we work,
whether we play or whether we save, there is some
consideration in which we must economise.

In this life of ours, we cannot have all we want to
have. We must choose between the things which we
want. We cannot do all that we want to do. We
must choose between the things which we want to do.
We can choose wisely, or we can choose stupidly. It is
our own responsibility to see that we choose wisely.
But once having made our choice, we can see to it that
we economise in carrying it out.

INVENTIONS SPKD UP THE SATISFACTION OF QUA WANTS

THE R d AD Of PRODUCTION

THE ROAD OF PRODUCTION YESTERDAY, TO-DAY AND

TO-MORROW

THE " ROAD " BECOMES A " RAILROAD " 197

We must always try to use, in the least wasteful way,
the means by which we can have our choices, whether
that means is our time or our labour or our money.
Often we may not be sure as to what the least wasteful
way may be ; but it is always our job to find out.

When we remember, too, what we give up when we
economise, whether we economise well or badly, this
should help us to choose what we really want, and with
our eyes open.

Summary. Good economy of our scarce labour,
time and goods in the populated world should set aside
some of each for satisfying our future needs as well as
our present needs. This is carried out in different ways
by individuals, by companies and by the State. Some
of the results of saving will be to give us greater security
in the future ; to help us to have more things ; to save
time and trouble and to have new and different things,
by making it possible to keep men and women exploring
and inventing, and by making more tools and machines
with which to work. Care must be taken so that our
scarce time and labour and goods are not wasted by
saving too much or by saving too little. They must all
be economised to strike the best balance between enjoy-
ment now and enjoyment later on.

If we want more goods and services (the answer to
Chapter 9), we can have them by working more,
inventing more, by making more machines and by
finding a better organisation. But if we do any of
these things, we must either give up part of our leisure
time now or part of our consumption of goods and
services now. Be careful that you think it is really
worth while.

For the future, we expect wants to be filled ever more
and more quickly and more fully, owing to the inventive
spirit in man.