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MAGAZINE

GEORGE GUNTON, EDITOR

VOLUME

NEW YORK

POLITICAL SCIENCE PUBLISHING Co.
34 UNION SQUARE

GUNTON'S MAGAZINE

VOL. XVI JANUARY, 1899 No. i

ECONOMICS AND PUBLIC AFFAIRS

Frontispiece . . . William Stanley Jevons

Shall the Treaty be Confirmed ? i

The Anti-Expansion Movement .'.... 5

Some Valuable Wage Statistics ... 11

Practical Defects of Socialism, — Frederick H. Co.\- . 20

Wealth and Its Production,—^. //. McKnight . . 26

Distinguished Economists: VII — Jevons . «g
Editorial Crucible : The President and the South— Dirty
streets and the Grip — Federation of Labor versus
socialism — McMaster on colonial policy — Poor outlook

for currency reform — A warning to new trusts. . . 31

Civics AND EDUCATION

Teaching of Economics in Schools,—//: Hayes Robbins 35

Civic and Educational Notes: Hazing abolished at

Princeton — Where education is not wasted ... 46

SCIENCE AND INDUSTRY

Decline in Railway Rates and Profits, — John Moody 48

Science and Industry Notes: Electricity and rapid

transit — The low price of cotton . . . . 54

CURRENT LITERATURE

Bohm-Bawerk on Karl Marx . . . . . 56

Additional Reviews : Christian Rationalism — Municipal

Reform in the United States ;,;. .... . 6l

Among the Magazines: Wasteful economy— Tolstoy's

plan of redemption — Enlightened selfishness . ... 63

GUNTON INSTITUTE WORK

Free Trade and Protection in Practice — (Class Lecture) 66

Work for January

Outline of Study . . . •;.."• . . ; 73

Required Reading . . . .. . . ;.-• 73

Suggested Reading . . . . . ^ . 73

Notes and Suggestions . . ... * 74

Local Center Work . . . . . . . 79

Question Box .... ...... . . . 80

Copyrighted, iSq8

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Rochefoucauld's Maxims. J
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Egyptian Literature.
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White's Natural History o
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Essays in Astronomy.

De Tocqueville's Democrac;
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WILLIAM STANLEY JEVONS.

GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

SHALL THE TREATY BE CONFIRMED?

Before the treaty of peace signed in Paris by the
Spanish and American Commissioners can become bind-
ing as the decision of the United States, it must receive
the approval of the United States Senate. Thus far it
embodies the demands of the United States as repre-
sented by the President and Cabinet. On about every
point the Spaniards were compelled to yield to the de-
mands of the American Commissioners. Before this
number reaches our readers, probably, this epoch-
making treaty will be in the hands of the Senate for
its confirmation or rejection.

There are two motives which will find expression
in the Senate in opposition to confirmation. One is the
motive of party opposition . There is a certain group in
the Senate which, for mere party motives, consider it a
•duty to oppose whatever the administration approves.
In certain quarters this is called good politics, but it is
never suspected of being good statesmanship. This
sentiment is not confined to either political party. Un-
fortunately there are in both parties those to whom such
an attitude seems the highest political duty. From
that source a certain amount of opposition to the treaty
is sure to come. Happily there are in both parties,
however, senators who are capable of viewing this ques-
tion from the broader standpoint of national policy.
Some of these look with grave apprehension upon the
whole policy of territorial expansion, particularly the
acquisition of the Philippines. They regard this as

2 GUNTON'S MAGAZINE [January,

a dangerous departure from what has hitherto been the
American Doctrine and the traditional policy of the
United States. To such statesmen as Senator Hoar, for
instance, the annexation of the Philippine Islands to-
the United States is the beginning of the downfall of"
the Republic.

The belief that this apprehension is well founded,,
and that the policy of imperialism which the treaty in-
volves is a very doubtful departure, the consequences,
of which may act disastrously upon the Republic, is.
manifestly gaining ground, but the practical question'
presented to the Senate is not whether territorial ex-
pansion per se is a wise or unwise policy, but whether
under the circumstances the Treaty of Peace should be
confirmed or rejected. That foreign imperialism should
not be a part of the policy of the United States may be
taken for granted. Only undigested sentiment, mere
impulse born of military victory, will ultimately be
found to support that idea; but the question for the
Senate to determine — at least that portion of the Senate
which is opposed to imperialism — is, would the end
desired be accomplished or even aided by the defeat of
the treaty ? There is a certain naturalness in the fact
that during the war the sentiment in favor of taking
from Spain her colonial possessions grew apace, with
the success of the American arms. Conquest is always;
the first impulse of the conqueror. Under the pressure,
also, of the villainy of many of Spain's actions, not the
least of which was the blowing up of the Maine when
on a peaceful visit to a Spanish port, it was inevitable
that the sentiment in the United States should grow in
the direction of taking from Spain whatever the suc-
cess of our arms put in our possession. On the strength
of this more or less transient sentiment, the administra-
tion has acted in favor of expansion and has compelled
Spain to acquiesce. Thus the Republic is committed

i899.] SHALL THE TREATY BE CONFIRMED? 3

to the new policy, at least to the extent of owning
Porto Rico and the Philippine Islands.

This is all a mistake from our point of view, but
the practical question to be decided by the Senate is,
Would the rejection of the treaty remedy the mistake ?
From the mere partisan point of view of embarrassing
the administration, to defeat the treaty might be "good
politics; " but from the point of view of statesmanship,
loyalty to the nation, maintaining the dignity of the
Republic and the respect of the civilized world, the
defeat of the treaty by the Senate would be a grievous
blunder. Whether we like it or not, the war has been
fought, the victory won, and despite our opposition
Porto Rico and the Philippines have been ceded to the
United States. It is too late now to say we will not
have the Philippines. If the Senate should reject the
treaty it would simply re-open the wrangling and per-
haps hostilities. It would prolong the state of war and
prevent the resumption of peaceful relations, which is
so much to be desired alike for commercial, political
and humane reasons.

To reject the treaty because it accepts the Philip-
pines would involve giving the Philippines back to
Spain. Neither the American people nor the civilized
world would approve of such a course. If adopted, it
would belittle the United States in the eyes of the
world. Whatever mistake has been made in demand-
ing the Philippines, and especially in giving twenty
million dollars for them, has become history, and to
reject the treaty now would not put us, nor the Fili-
pinos, where we were before. If, instead of paying
twenty millions for the Islands, we had insisted that
Spain pay for the destruction of the Maine and the ex-
penses of the war, and demanded the Philippines as
security for this indemnity, we might have been in an
entirely different position; but the government of the

4 GUNTON'S MAGAZINE

United States demanded the territory and the terms
have been conceded.

During this time Spain has lost all her authority over
the people of the Philippines. If, now that the whole
status has been changed on the assumption that the
Islands would come under the United States' authority,
we reject the proposition, we simply add confusion and
chaos to the situation. Neither the dignity of the
United States, due regard to the Filipinos, nor respect
for the civilized world will permit us to take that step
at this late stage of the proceedings. Spanish impotence,
American skill and vigor, hesitating statesmanship, and
the fates all seem to have conspired to put the Philip-
pines under the authority of the United States. The
die is cast; the Philippines are ours, and the defeat of
the treaty could do nothing but aggravate the situation,
belittle the nation, and make a rational, statesmanlike
policy less possible. From every point of view it is
manifestly the duty of the Senate to confirm the treaty,
not because territorial expansion is good policy for the
United States, but because the defeat of the treaty will
not now remedy the mistake. True statesmanship will
seek to remedy whatever mistakes have been com-
mitted, not by defeating the treaty but in so shaping
the plans under which the new possessions shall be gov-
erned as to avoid the evil of making imperialism a per-
manent feature of the Republic's policy.

THE ANTI-EXPANSION MOVEMENT

Public opinion against the policy of territorial ex-
pansion is making rapid headway throughout the
country. An organized movement has been started for
agitating the subject and educating public opinion
against the tendency toward imperialism. A few weeks
ago an Anti-Expansion League was organized in Massa-
chusetts, and now similar organizations or branches of
the same are already established in over thirty states.
This is a wholesome and, if properly conducted, may
be an important movement in political education. The
subject of territorial expansion has never been ade-
quately discussed by the American people. It has, so to
speak, been sprung upon the nation as the accident of a
successful war, and, under the impulse of patriotic
enthusiasm and military victory, our acquisition of new
territory has been accepted as the finger-post of destiny
pointing to a policy of imperialism for the United States.

The dangers to domestic interests in this policy
have received practically no public consideration. A
well organized national movement for the discussion of
the subject would be a great step in the political edu-
cation of the nation. In order to be effective, however,
and not to do more harm than good, it is important that
the movement be kept entirely free from any third
party political taint. It is also necessary, if the move-
ment is to have any lasting effect, that it be not entirely
negative, mere protest against what has already taken
place, such as urging the defeat of the treaty in the
Senate.

In the first place, it is highly important in the or-
ganization of such a movement that its personnel and
leadership should be beyond suspicion. Such names,
for instance, as Edward Atkinson, Carl Schurz, John G.
Carlisle and Grover Cleveland, as vice-presidents and

5

6 GUNTON'S MAGAZINE [January,

conspicuous directors of trie movement, are well calcu-
lated to prevent it from creating any real national en-
thusiasm. If the movement is dominated by such
persons the American people may very naturally be ex-
pected to view it with suspicion, and, instead of aiding
it, will be likely to support the administration as rep-
resenting the movement of patriotism and true Amer-
ican interests. The American people cannot be made,
and ought not'to be made, suddenly to forget the ex-
perience this country passed through from 1892 to 1896
under the leadership of this type of statesman. The
names of Cleveland and those immediately associated
with him properly stand in the American mind for
national disintegration and industrial disaster, paving
the way to political disruption. Nor can they easily
forget his unconstitutional effort forcefully to overthrow
a republic and re-establish a semi-savage monarch in
Hawaii. If the anti-expansion movement is to bear the
evidence or in any way justify the suspicion that it is a
third party or a new Cleveland party movement, with a
free trade, un-American background, then it may be
expected to fail.

We are now well under way towards a period of na-
tional prosperity. The cloud of industrial distress, busi-
ness disaster, enforced idleness and bankruptcy, is lifting,
and the sunshine of national progress and prosperity
is again upon us. For some time to come, at least, the
American people will not readily enthuse over any move-
ment which even remotely may be suspected of bringing
in its train the destructive doctrines of Clevelandism.

For this reason the Anti- Expansion League should
make its purpose and methods explicit and construc-
tive. It should be wholly educational in its aims, and
entirely free from any taint of political party organiza-
tion. It must not merely oppose the Treaty of Peace.
"That is too much of an accomplished fact for its defeat

THE ANTI-EXPANSION MOVEMENT 7

now to aid the anti-expansion cause. To be of real
-service to the nation, besides opposing the doctrine of
expansion and imperialism, the League must advocate
a constructive policy for the treatment of the new pos-
sessions which have, accidentally as it were, fallen
into our hands. Our treatment of these will probably
shape the policy for the future, and go far to establish
the doctrine upon which the United States will here-
after act.

Thus far, unfortunately, the expression of this
movement has lacked all constructive character. It is
in the form of a protest. It is this very characteristic
that is most likely to create suspicion. As already sug-
gested, the conspicuous names among the vice-presi-
dents and leaders of the movement are notorious for
their " anti " or protesting proclivities. They are
known to the public as anti-administration, anti-protec-
tion, anti-Monroe Doctrine, and anti almost everything
that is distinctly American. For this reason pains
should be taken to make it clear to the public that this
movement is not a mere free trade, anti-Monroe Doc-
trine movement in disguise. It should be explicit in
the formulation of its purposes, with as little unknown
quantity in its make-up as possible. In short, it must
be clearly non-partisan in character, thoroughly Ameri-
can and patriotic in its spirit and tone, and construc-
tively protective towards domestic industries and inter-
ests, and democratic in its colonial policy propositions.

In order to give the movement a national charac-
ter it should be freed from all ambiguity and suspicion.
It must stand for something definite and constructive,
both in home and foreign policy. For instance, on the
question of the form of government to be introduced
in Hawaii, Porto Rico and the Philippines; — Shall
they be made territories of the United States on the
same basis as Arizona and New Mexico, with the as-

I GUN TON'S MAGAZINE [January,

sumption that they may be admitted to statehood in
any convenient emergency, or shall they be made into
colonies, governed by an extra-constitutional form of
government and kept so distinct as to be entirely sep-
arable and if necessary be disposed of by treaty to any
other nation or nations, or given independent govern-
ment? The state of mind of the American people on
this matter is of vital importance, as it may form the
traditional policy regarding the whole subject.

On the question of the '• open door " it is quite im-
portant that a wholesome educational campaign be con-
ducted. The people of the United States may easily
be induced to establish the policy of the open door in
the Philippines and other foreign possessions, but if
that is used as the entering wedge for introducing the
open door in the United States, it would become a mere
free trade movement whose influence could only be
detrimental to business, and would really strengthen
the expansion sentiment.

Some of the anti-expansion organs, like the Boston
Herald, the New York Evening Post and others, have al-
ready begun to present this view as showing that an-
nexation of the Philippines necessarily overthrows the
doctrine of protection, at least so far as trade between
the United States and these new territories is con-
cerned. This seeming effort on the part of those
who are conspicuous in the origin of the anti-expansion
movement suggests and to some extent warrants
the suspicion that there is danger that the movement
may be used more for the purpose of destroying our
present protective policy than for educating the Ameri-
can people to the dangers of imperialism.

It may not be the conscious purpose of anybody to
make this movement really serve the objects of a free
trade league, but there are many reasons whyj sus-
picions of this tendency may arise. For the sake^of

1899.] THE ANTI-EXPANSION MOVEMENT 9-

the useful influence of the League, in the direction of
sound political education and arresting the tendency of
public opinion toward territorial expansion as a national
doctrine, it is of the utmost importance that it be entirely
educational in its character, and definitely constructive
in its programme. The people of this country are not
ready for any more disrupting experiments in our in-
dustrial policy. A distinct colonial policy, with the
view of giving self-government to the new territories
as soon as possible, which would make the maintenance
of our protective policy for the United States and the
" open door" for the new territories rational and feasi-
ble, would find wide popular support.

We are not justified in assuming that the adminis-
tration is committed to an imperial policy, but rather
that we have come into possession of foreign territory
as an unavoidable incident to a justifiable war. The
President's address at Atlanta clearly shows that the
administration is following rather than leading events
in that direction. The President's statement of the
government's position has the ring of patriotism and
popularity when he asks: —

1 ' If, following the clear precepts of duty, territory
falls to us and the welfare of an alien people requires
our guidance and protection, who will shrink from the
responsibility, grave though it may be ? Can we leave
these people who, by the fortunes of war and our own
acts, are helpless and without government to chaos
after we have destroyed the only government they have
had ? After destroying their government, it is the
duty of the American government to provide for them
a better one. Shall we distrust ourselves; shall we
proclaim to the world our inability to give kindly gov-
ernment to oppressed peoples whose future by the vic-
tories of war is confided to us ? We may wish it were
otherwise, but who will question our duty now? "

I0 GUNTON'S MAGAZINE

To this sentiment no progressive American can object.
This is exactly the kind of appeal to the heart and
enthusiasm of the American people that would lead
them to endorse the administration in whatever seemed
necessary. The real work of the Anti-Expansion League
is not to antagonize this sentiment, but to utilize it. It
is not to humiliate the administration by trying to de-
feat the treaty in the Senate, which is now practically
impossible, but intelligently to discuss the policy the
American government should now pursue regarding the
control of this foreign territory as an involuntary duty
thrust 'upon us. Our duty is so to direct affairs as to
enable each of these possessions to become self-sustain-
ing as soon as possible. "We may wish it were other-
wise," says the President, "but who will question our
duty now ?" Our duty is clearly not to flood the Senate
with petitions against confirming the treaty, but to cre-
ate a public opinion throughout the country which,
through addresses, discussions in the newspapers and
petitions to congress, shall inform those responsible for
shaping our national policy that the American people
are for protecting and developing the industrial possi-
bilities and social life of the people of the United
States; that we are not fired with the spirit of conquest
and imperialism; that there is no real desire among our
people for mere territorial expansion, but that the real
interest and impulse of the American people is to raise
the standard of our own civilization, rather than to ex-
tend the area of our political authority.

If the responsible leaders of this new movement will
at the outset take the steps to make its objects clear and
entirely free from any third party free trade flavor, it
may do a most important educational work, and save
us from entering upon a foreign policy which might be
full of danger to the Republic.

SOME VALUABLE WAGE STATISTICS

The bi-monthly Bulletin issued by the United States
Department of Labor very frequently contains industrial
information of great significance and permanent value.
It summarizes in easily understandable form the results
of investigations that are continually being made, under
the direction of the department, into the economic con-
ditions which form the raw material of our great -social
and political problems. Modern social life is so com-
plex, and touches the individual on so many sides, that
a large number of distinct problems are developed out
of these varied relations and the data of these problems
naturally become the objects of special investigations.
Some of these investigations have been very exhaustive,
on such subjects as Industrial Depressions, Convict
Labor, Strikes and Lockouts, Working Women in Large
Cities, Cost of Production, Industrial Education, Eco-
nomic Aspects of the Liquor Problem, Compulsory In-
surance in Germany, etc., and the results have been
published in bound volumes. Other reports, of a nar-
rower scope but often very significant, covering such
matters as the work of the various state bureaus of labor
statistics, legal decisions affecting labor, results of labor
arbitration systems, the negroes and Italians in various
cities, slum problems in cities, labor of women and
children, factory inspection, public baths in Europe,
• etc., are made public through the medium of the bi-
monthly Bulletin.

The September number of this publication contains
the results of an investigation of wages in certain Amer-
ican and European cities. The data cover a period
of twenty-eight years, and are classified according to
trades and occupations. This detailed method not only
.gives us more accurate results than a general lumping
of averages, but permits much more definite and intel-

n

GUNTON'S MAGAZINE

[January,

ligent comparisons, both of wages in our own and for-
eign cities and of wages to-day and in former periods. A
few general averages are given, but it is shown just
what facts are included in these averages, so that we
may know to what extent, if any, comparisons are pos-
sible. For instance, a summary of wages in twenty-five
representative trades in certain cities of the United
States and England, and in Paris and Liege, is given,
and, while these are not comparable with each other,,
each statement may be taken by itself as showing the
trend of wages between 1870 and 1896 in these respec-
tive groups. The wages are expressed in all cases on
the gold basis, so that any element of error due to cur-
rency inflation during the '/o's is eliminated. The
reason these figures for the different cities are not com-
parable with each other is that they represent a different
number of wage quotations in each case.

We give here the daily wages for six different
years since 1870 inclusive:

1870

1875

1880

1885

1890

1896

12 cities in the U.
S. , representing
255 wage quota-
tions

$2.20^

$2.24X

$2.34

$2.47>C

$2.52^

$2-45#

3 cities in Great
Britain, 27 wage
quotations

1.30

1.38

1-37*

i-39#

1.41*

1.49

Paris, 21 wage
quotations

1.06

i.nX

I.2IX

i.«4#

i-3iX

1-33

Liege, n wage
quotations

•59K

.63^

.62^

.63*

•63X

•66*

The general trend, it will be seen, is upward, and
so these data are merely illustrative, in one more way,
of the whole tendency of wage movement throughout
at least the latter part of this century, in countries
using modern industrial methods. The only marked ex-
ception is in the United States since 1892. The highest

•i 8Q9-]

SOME VALUABLE WAGE STATISTICS

point, i. e.y $2.56, was reached in that year, since which
time, tinder the disastrous influence upon business of
the so-called tariff reform policy, wages in these cities
.and trades have steadily declined, reaching $2.43^ in
1898, which is lower than at any time since 1881. It
is well known that wages in large cities are always
much less easily forced down than in small towns or in
the country, but even in the cities, according to this
showing, the industrial depression due to that experi-
ment in partial free trade put back our wage conditions
fully a decade.

The wage statistics classified by trades admit of
comparison city with city, because they show the pre-
vailing rates of wages in the specific trades and localities
year by year. The figures given in the Labor Bulletin
•cover twenty-five trades and occupations in each of
twelve cities of the United States, two in England, and
in Glasgow, Paris and Liege. In two of the more im-
portant of these trades we give below the wage figures
for six different years since 1870, in New York, Philadel-
phia, Chicago and San Francisco, in the United States,
and London, Glasgow, Paris and Liege in Europe :

BRICKLAYERS

New York.

Phil'a.

Chicago.

San
Francisco.

London.

Glasgow.

Paris.

Liege.

1870

$3.l6X

$2.96^

$2.78X

$5-00

$1-53

$1.13^

$i.o6X

1875

2.98^

3.33X

2.22^

5-00

i.59#

i.38X

!iSK

1880

3.I2X

2.553^

3-50

4.00

1.593*:

I.2IX

.64

1885

3.84

3.363^

4.00

5.3534:

i.59#

I.2IX

.64

1890

4.00

3.773^

4.OO

5.83X

I.5934:

I.46#

.64

1896

4.00

3.79

4.OO

5.00

i.68tf

i-55#

.64

CARPENTERS

1870

$2.87^

$2.42

$2.I2<4:

$3.85X

$1.53

$1.1234:

$ .20#

1875

3.0434:

2.40^

1.96^

3-61

I. tjg3/

1.4634:

• 24X

1880

3-4034:

2.18

2. 2O

3.35

L5934:

.1234:

•37%

1885

3-48X

a.8oj5-£

2.3534:

L5934:

.293<

•5534:

.78

1890

3-48X

2-74^

2.2934:

3.24

1.5934:

•38X

• 78^

1896

3.49*

2.77X

2.54

3.213*:

L5534:

.81

14 GUNTON'S MAGAZINE [January „

In some of these instances the rise in wage rates is.
very marked, and may be considered evidence of the
effectiveness of good organization. These two trades y
in fact, carpentering and bricklaying, as a rule are well
organized, and it is by virtue of this fact chiefly that
the rates can be and are maintained at such figures as
$4.00 in New York and Chicago and $5.00 in San Fran-
cisco, for bricklayers, and $3.50 in New York and $3.22
in San Francisco, for carpenters. The only city which
does not show an actual rise in nominal wages is San
Francisco, but undoubtedly the reason for that is the
rapid cheapening in the cost of living on the Pacific
Coast during the last two decades. A general fall in
prices since 1870, due to reduced cost of production,
has of course taken place throughout the whole country,
but in San Francisco and cities of the far West there
has been a considerable additional reduction due to the
opening of that country and establishment of easy com-
munication with the East. Therefore, the maintenance
of the San Francisco wage rate for bricklayers continu-
ously at $5.00 from 1870 to 1896 iindoubtedly means an
increase in real wages quite as large as the rise in the
nominal wages in New York from $3. 16% to $4.00 dur-
ing the same period. It will be noticed that carpenters"
wages in San Francisco declined somewhat during this
period; in other words, the carpenters, for some local
reason — perhaps less effective organization — were un-
able to keep up the rate in face of the exceptional
cheapening of the cost of living in that city. But as a
result of that reduced cost of living, together with the
general fall in prices throughout the country, it is prob-
ably true that there was an actual increase in the real
wages of San Francisco carpenters, despite the fall in
the nominal day rate.

In order to give a little more complete idea of the
general movement of wages in various city trades, we

I899-]

SOME VALUABLE WAGE STATISTICS

present the figures for three different years between
1870 and 1896, for blacksmiths, compositors, house
painters, teamsters and common laborers.

BLACKSMITHS

1870

1885
1896

New
York

$2.24^
2.62^

2-45

Phil' a
$1.86

2.32X
i.78#

Chic' go

$2.51^
2.88

2.8oX

San
Fr'ncs'o
$3-803^
3.48
3-I6X

Lond'n
$1.46*

I-54X
1.6214:

Gl'sgow

$1.09^
1.2134:
1.48

Paris
$1.19^
1-3034:
i-7iK

Liege

$.68^
•78X
•89X

COMPOSITORS

1870
1885
1896

2-53
3-03
3-14

2.58X
2-7itf

2.31

2.88^
3.00
3.00

3-41^
3-49

3-35X

1.46
1.46
I-54X

i.nX

I.3I34:
1.38

1.1534:

I.25X

1.25^

.64
.82

.79%:

HOUSE PAINTERS

1870
I885
1896

2-43^
3.3034:
3-50

2.39

2.77X

2-72X

1.66

2.67^
2.61

3-72
3.00

2.83X

I.43X
i.5i
1.48

1.19
1.33
1.38*

i.o6X
1-35
1.35

.55

.65K
.64

TEAMSTERS

1870
1885
1896

i.69X

2.11^

2.0734:

i.37#

I.73X
I.72X

i.74#

2.02^
2.02^

2.63^
2.6234:
2.37

1.18^4:

1. 21

1.263$:

.55^
.55^
•59X

COMMON LABORERS

1870

1885
1896

1.76*'
i.68tf

i.56#

1-2934:
1.50
1.50

1.56^
1.50
1.50

2.OO
2.OO

I.7I34:

.863^
.8634:
•96X

•53X
.5334:
• 52^

There are several interesting points to be noted in
these tables. In the first place, the relatively low
wages paid common laborers in comparison with the other
occupations reflects both the general lack of organiza-
tion and inferior living standards of the class.

San Francisco wages show the same downward
tendency in each of these five occupations as in the case
of carpenters, and probably for substantially the same
reasons. There is another cause, however, which un-
doubtedly has a good deal to do with this uniform
decline. The carpenters, blacksmiths, painters, etc. , who •
first went out to San Francisco, in the '6o's and '/o's, were
in a sense the pick of the eastern workingmen ; they
were the more energetic, enterprising and independent:

*i87i.

If) GUNTON'S MAGAZINE [January,

men of their class, and their services being needed in
San Francisco, were able to establish and maintain a
comparatively high rate of wages, perhaps higher even
than the difference in the cost of eastern and western
living at that time alone would account for ; but when
the great Pacific railways were put through and the
West was no longer an isolated community, a more
average grade of artisans and laborers rapidly migrated
to that section and rendered unnecessary the services
of the most expensive employees in the various trades,
or at least so increased the number of less expensive
laborers that the dearer group was not sufficiently
large in proportion to maintain the high rate in the face
of a rapidly diminishing cost of living.

It should be remembered, however, that the wage
quotations for 1 896 do not fairly represent the trend of
wages since 1870, either West or East, for the reason
that the long industrial depression since 1 892 put wages
back in almost all employments. This applies not only
to San Francisco but to each of the other American
cities shown in these tables. Blacksmiths, for instance,
in New York City, were paid $2.92^ in 1892; $2.84 in
Chicago; $2.15 in Philadelphia and $3.22^ in San
Francisco.

The exceptionally low rate for blacksmiths in
Philadelphia in 1896 is not representative of the wage
conditions in that trade and city during the last few
years. Indeed, it happens to be the lowest quotation
in the whole series of twenty-eight years shown in the
Labor Bulletin table. The rate during the last ten years
has averaged in the neighborhood of $2.20. In 1889
it was $2.32, which was practically the high water mark.
In 1897 it was $2.05%;. It would not be correct, there-
fore, to assume that even the nominal wages of black-
smiths in Philadelphia have declined since 1870, for
such is not the case.

i8Q9.] SOME VALUABLE WAGE STATISTICS 17

It should also be remembered, of course, that the
increases in money wages shown in most of these
citations do not represent the whole truth of the matter,
for the reason that the fall in prices, which amounts to
an increase in actual wages, is not shown in these
tables. Were this cheapened cost of living embodied
in the above figures the rise in wages would be much
more marked.

Perhaps the most interesting feature of all is the
comparison between wages in American and European
cities, which comparison, in specific trades, is entirely
legitimate. In London, it will be seen the wages are
about one-half those in New York in most of the cases
shown. In Paris the difference in favor of New York
is even greater, and in Liege the wages are as a gen-
eral rule from two-thirds to three-fourths less than in
the American cities quoted. A small part of this
difference is due to cheaper house rent, and a part prob-
ably to lower prices for some of the necessaries of life.
Nevertheless, much the greater part of the difference
in wage rates represents an actual difference in the
standard of living of the respective groups of laborers
in these foreign as compared with American cities.
That is to say, while it is entirely true to claim that the
cost of living is less in Paris and Liege than in New
York or Chicago, the greater part of this simply repre-
sents a much narrower range of consumption. That is,
a large number of the commodities that are habitually
used by American workingmen are entirely beyond the
reach of the French and Belgian laborer, and hence do
not enter into his cost of living, simply because he
does not make use of them at all; and this difference in
the cost of living is exhibited throughout the whole
range of the laborer's consumption, viz., in a less var-
iety and poorer quality of furniture in the house, fewer
comforts, less expenditure for recreation, amusement or

l8 GUNTON'S MAGAZINE [January

education, not much literature, an inferior dietary,,
clothing — if not actually inferior, at least worn very
much longer before discarded. As to house rent,
the apparent money advantage of the foreign laborer
generally represents very inferior living accommodations.
Investigations into the conditions of the laborers' homes
in Europe demonstrate this very clearly. Not only are
the homes much less attractive in themselves but they
are decidedly inferior in point of sanitation and other
requirements of decency and health to the average
American home. Furthermore, rent is only one item
of expenditure, and even though considerably larger
in this country, it forms relatively a much smaller
feature in the total expense of living. For instance, it
would be grossly incorrect to say that if American
wages were double the European, and American rents
also twice as high as the European, therefore the two-
conditions would be equivalent. To illustrate : a composi-
tor in Liege at about 80 cents a day would get, if
steadily employed, in the neighborhood of $20.00 per
month. A compositor in New York at $3.14 a day,
would get between $75.00 and $80.00 a month. There-
fore, if the rent in Liege was $8.00 per month and in
New York $16.00, this item would consume two-fifths,
of the entire income of the foreign employee, and only
about one-fifth that of the American. Indeed, the
New York compositor could pay in rent an amount
equal to the entire income of the foreigner and still
have $55.00 or $60.00 per month left to live on.

This difference in the scope, variety and breadth of
workingmen's living conditions is an actual difference
in the elements that make up civilization, and hence in
civilization itself. Public policies which tend to promote
and protect the economic forces that make and main-
tain superior wage conditions in any country, are trust-
worthy and sure instruments of progressive civilization.

1 899.] SOME VALUABLE WAGE STATISTICS 19

To allow the unrestricted competition of the inferior
with the superior never permanently improves con-
ditions in the place where the inferior originates, but
only serves to undermine and drag down whatever
higher standards have anywhere been attained. The
problems of social and economic conditions can only be
solved each in the spot where it arises, and whenever
or wherever any such problem is once solved, or a step
taken towards its solution, the fruits of that solution
must be absolutely secured, or that forward step given
a firm and solid footing. Only so can any others hope
to come up to the same advanced level and thus share
in the new and better order. In the broadest kindness
there must often be an element of sternness and resol-
ute setting up of bounds and limits ; the greatest re-
sponsibility civilization imposes upon the American
Republic is that it shall not, through any false or mis-
directed sentimentality, put in jeopardy any of its high
achievements for the race, whether in respect of indus-
trial or political conditions, or the wages and social
standards of its great laboring population. The day
when the upward movement in wage conditions, of
which the foregoing tables are indices, is permanently
stopped will, if it comes, be the day of arrested progress
for the nation.

PRACTICAL DEFECTS OF SOCIALISM*

FREDERICK H. COX

There is a widening gulf between workingmert
and employers, an arraying of civilized man into two
opposite industrial camps. This is especially true in
continental Europe. Many are incredulous of danger,
but Europe was as incredulous of a coming second
French commune as of the first. What is to be the out-
come? What will remedy the industrial ills that
threaten a great social conflict? The answer most fre-
quently heard to-day is that all present tendencies
point to socialism. So far, however, from that being
the correct solution, socialism can only be an experi-
ment— a dangerous experiment — with vast and costly
possessions and with civilization itself. Socialism is to
be respected for aiming to correct existing faults, but it
would be so severe a remedy, if it did abolish certain
purely industrial inequalities, as to blight all the other
and higher phases of civilization.

In common fairness, socialistic tendencies should
not be made to include tendencies to anarchism. The
two are entirely distinct. Nevertheless, socialists
themselves are not agreed on any one plan of action.
Two leading policies are advocated: first, (after social-
ism has been voted in, peacefully if possible) propor-
tional distribution of productions to each man according
to the appraised value of his labor, called "scientific
socialism "; second, equal distribution, and the nation to
own all the means of production, i. e., everything ex-
cept private homes.

The first miscalculation in this plan is on the possi-
bility of voting in peacefully a change of basis of our
whole legal system of property rights and industrial

* Part of address delivered in Association Hall, Boston, Mass.

20

PRACTICAL DEFECTS OF SOCIALISM 21

and social organization. They may try to call revolu-
tion evolution, but how is it possible to appropriate all
buildings except dwellings, all tools, and all means of
production, peacefully? Even if socialism were actually
voted in, two things would be necessary really to es-
tablish it. For one thing, the men just out-voted would
be in a far more desperate fighting mood than were
creditors who recently feared that unlimited coinage of
silver would confiscate a portion of their loans. Would
not these excited non-socialists, in their business houses
and workshops, lock the doors and resist ejection? At
least a hundred million people have inherited the old
English common law that even the poorest man, if
charged with no crime, may lock his door and bid defi-
ance to all the forces of the crown, or of a republic.

Then, suppose England and all other wealthy
countries were not socialized as soon as Spain, for in-
stance, in whose bonds these nations have millions in-
vested. Or, take this country; Europeans have hun-
dreds of millions invested in American lands, railroads
and factories. Europe declared war against the French
revolutionists merely to help a king, and it is the policy
of all Europe not to allow confiscation of their citizens'
property in foreign lands. We could not avoid wars by
paying these debts with gold and silver confiscated
from our people, because this would be only one-tenth
enough, and a good part of it would be taken out of
the country by its owners before it could be seized.
Our money represents a part of all our wealth, but only
a part, and only represents. The real property, to the
utmost extent possible, would be moved from the coun-
try while the states were, one by one, amending their
constitutions to bring about this would-be-called "evo-
lution."

How could a socialistic committee decently select
the invalids who should be excused from work? Even

22 GUN7VN'S MAGAZINE [January.

our public charities are deceived and drained by many
who are merely indolent rather than incapacitated. At
best there would be a mixture of favoritism, mistaken
kindness and cruelty. More than in the army, more
than in slavery, all such infirmities as nervous diseases
and other complaints of %whose genuineness physicians
cannot determine unless the individual can be believed,
under socialism could not be judged with any certainty,
and enormous deceptions would take place. If, on the
other hand, each person's word were not taken, what a
number of innocent victims in one generation even
would be tortured by the cruel dictum: "Work or
die!" If the people's word were taken, what a multi-
tude of paupers!

The three-hour work-day proposed by socialism
would have to be eight or ten for all merely to live.
Accumulations of wealth for colonizing and evangelizing
the world, for inventions, feats of engineering and pub-
lic improvements, would be impossible. How would
socialism then meet famines, floods, volcanoes, earth-
quakes, fires, or anything requiring great labors and
great capital to repair the loss ? From whence would
come the capital, the guaranty of risks, and the individ-
ual enterprise for all the great new undertakings on
which the world's progress and improvement depend?

Under the present system production has been
great enough to meet all possible contingencies, but
distribution is perhaps faulty. Let us look at social-
ism's plan of distribution. The greatest socialist minds
have discarded the theory of equal distribution for what
they call scientific socialism. But how will the feroci-
ous equality sentiment, which is always the mainspring
of socialism, endure the differences of treatment neces-
sary in a system of distribution according to appraisement
of various kinds of work? What would be the result of
saying to one division of laborers : < < Here is a six-hour

i899.] PRACTICAL DEFECTS OF SOCIALISM 23

labor-note for your three -hours' work," and to another
having worked as hard and as long: " Here is yours
for three "? Yet this is what scientific socialism pro-
poses. If there is discontent at unequal distribution
to-day, what will happen if the promised paradise
brings worse despotism and nepotism? The elective
-system serves not to prevent, but to increase, favorit-
ism. If an official would not favor his electors against
their adversaries, he would be given the pick and
shovel. Unbearable injustice, leading to constant revo-
lutions, would follow any attempt to place in the hands
of officials elected by popular vote the right of determin-
ing the relative value of and pay for each man's work.
And then, officials will necessarily be many fold
more numerous than to-day. An office-holder's great
fear would be that his post might be considered useless
and abolished. For defence he would swell the impor-
tance of his duties from the first. Formalities would be
increased, and with them the number of officials. No
one would dare propose combining growing offices and
-discharging superfluous officials for the sake of economy
and efficiency. The higher departments would shrewd-
ly fix the wages of labor until they had built up a polit-
ical machine more corrupt and powerful than the world
has yet known. Department officials would favor their
own workmen at the expense of good service, that
their department might run smoothly. But the nation's
income is limited, and discrimination as to pay
would cause bitter feeling between departments; and
seesaw quarrels would rage in the same department if
each were paid according to the appraised value of his
labor. Fraternal feeling never supplants self-interest
among great numbers; witness the disastrous French
commune of 1848. Out of an attempted non-competi-
tive system comes internal competition, -dissension, cor-
ruption and spying surveillance.

24 GUNTON'S MAGAZINE [January,

But passing over the dangers of foreign wars, in-
ternal revolutions, bitter dissensions, the difficulties of
satisfactorily distributing labor forces, of organizing
agriculture, of herding animals, of the thousand human
activities ignored by socialism, this gigantic artificial
scheme, if it worked at all, could not possibly last.
Although the law would not permit the use of any sur-
plus possessions for productive purposes, gifts and in-
heritances could not be long prevented, nor gratuitous
loaning. All interest would of course be usury and
punishable; but there have always been usury laws,
and yet most states have now abandoned them because
they are not enforceable. How can the state prevent a
saving man from loaning and having the interest
merged with the principal? A needy man will gladly
give a hundred-dollar note to get ninety dollars, and
cannot prove his creditor guilty of usury, nor does he
dare try, for he may need to borrow again. What
could prevent a man from buying more than his neces-
sity required of grain or other staple provisions, in an-
ticipation of a coming scarcity, later selling them at an
increased price? Usury, speculation and smuggling
have flourished in all countries; and half the American
distilling is done by forbidden moonshiners.

Socialism must inevitably have one of three re-
sults;— work as planned, run back to individualism, or
bring about a dead equality, with men as unprogressive-
ly equal as savages. This last alternative would be the
outcome of equal distribution or communistic socialism.
Under such a system, of course, there would be no luxu-
ries. Luxuries, however, are the signs of progress.
When the skins of animals were used for clothing, in
Europe, the first cloth was made to cover a Bavarian
prince. To-day cloth is no luxury. Nearly all the
modern conveniences of life and many of the necessi-
ties—much of our food, even— began as luxuries:— mod-

1 899.] PRACTICAL DEFECTS OF SOCIALISM 25

erti buildings, cottages, hotels, stoves, clocks, all furni-
ture, books and all printed matter, tea, coffee, pepper,
sugar, common potatoes — a thousand such things.
Had it not been for luxuries man would still be living
in caves and huts. Is progress finished? Are the
great and good things brought through individual free-
dom exhausted? Some dreamer has thought so, doubt-
less, in every one of the last two thousand years of
almost continuous advance.

Communistic socialism, with the government man-
aging everything except the home, would yet restrain
the wants of the home; it would repress individual de-
sires, liberty of the press, and even freedom to teach in
schools anything disliked by the ruling authority. No-
criticism of abuses with government running the print-
ing industry! No cartoons upon bosses! The doctrines
of the reigning state taught everywhere by the reign-
ing state! Rights of assembly would be prevented by
the government refusing use of halls, land or any place
where associations could meet to criticise the universal
association. Under such socialism, with the emulation
of profits gone, luxuries, changes, new discoveries,
progress and liberty abolished, there would come
equality at last, but a stagnant equality which by
natural law would become retrogression and finally
barbarism. Civilization is a progression, with changes,
innovations and freedom to rise above mere equality.
Nomadic tribes in Asia have been socialized quite
perfectly for centuries. If, therefore, socialism suc-
ceeds in barbarous communities, let it be tried in some
section of partitioned China, for instance, and not in
any modern nation where it would simply undo the civ-
ilization developed from the experience of ages.

WEALTH AND ITS PRODUCTION*

A. H. M'KNIGHT

The term " wealth " has been variously defined by
-economists, some giving it a more and some a less ex-
tended signification than it has in common parlance. I
shall take it to mean those transferable material things
that have a utility and value created by human effort.
This definition, it will be seen, excludes human facul-
ties, skill and energy, which are sometimes embraced
in the term; and also those useful things whose utility
is a gift of nature. Skill and intelligence are very de-
sirable; but they are personal, intransferable, and can-
not be wealth. To call them wealth is to confound
wealth with man. Again, sunshine and air are very
useful; but they are also free, and hence have no value.
Any article to fall in the category of wealth must be at
once material, transferable, useful, and valuable.

Four factors participate in the production of wealth
— Land, Labor, Capital, and Natural Forces. Only
'three of these factors are commonly given, natural
forces being either omitted or treated as synonymous
with capital. Although we are enabled to harness
many of the forces of nature only by means of capital,
yet the two are quite different, and I have thought it
best to make a distinction between them.

Land, as the term is here used, means the earth's
surface, together with those things that are inseparable
from it. Labor is the expenditure of human energy,
and capital is wealth employed in the production of
other wealth. By natural forces is meant "all natural
agencies outside of man and land." Some of these
forces — e. g. the light and heat of the sun — are gratui-
tous; while others— such as heat and electricity — can be
-employed only by the use of capital.

^Portion of Gunton Institute Thesis ; Course of 1897-98.

26

WEALTH AND ITS PRODUCTION 27

A producer is one who creates utility. To give an
article utility is to make it capable of satisfying human
wants. This it can do only when it is within reach of
the consumer. Every effort, then, that brings an ar-
ticle nearer the consumer adds to its utility; for it in-
creases its power of satisfying want. Wealth is pro-
duced when it is prepared for consumption, and he is a
producer who, in any way, aids in this preparation. It
is a mistake to suppose that only those who till the soil
or labor in the workshop are producers. The teamster
in the backwoods settlement who hauls the produce to
market is as much a producer as is the farmer who tills
the soil. The lawyer at the bar, the teacher in the
schoolroom, the minister in the pulpit, — these must be
counted in the ranks of producers. That great class
known as the * 'middle-men" are not robbers. They
create utility, — and are, therefore, producers of wealth.

Man creates nothing material. His part in the pro-
duction of wealth is to place materials so that the forces
of nature can act upon them and bring about the de-
sired result. Man puts things into new positions, forms
new combinations and relations; and nature does the
rest. A plain stick is carved into an ornament, a rough
piece of iron is made into watchsprings, bricks and
mortar or marble and cement are fashioned into a pal-
ace, seed is sown and brings forth grain, — in all these
cases man has only brought existing particles into new
positions and relations; and every improvement made
in machinery, and every invention, is but to facilitate
this process.

Desire is the incentive, and some good the object,
of all human effort. Men produce wealth in order that
they may satisfy their wants. . . . The number of
wants a people has and its ability to satisfy them deter-
mine its state of civilization. Primitive man's wants
were few, and he used simple methods of production in

28 GUNTON'S MAGAZINE

satisfying them. Land, labor, and natural forces were
the factors he employed. His wants were principally
of a physical nature. Nearly his whole time was taken
up in maintaining life and protecting his progeny, and
but little opportunity was had for cultivating the mental
and moral elements of his being. But new wants arose,
and new methods of production were necessary to sat-
isfy them. An ungratified want will soon die. Man's-
ability to satisfy his wants is dependent upon his power
to command wealth. Wealth is the staff of civiliza-
tion, and material progress is at the foundation of all
progress. . . .

Man becomes dear as wealth becomes cheap.
Wealth can be cheapened only as its cost of production
is lowered. The cost of production can be reduced
only by harnessing new forces of nature. These natural
forces are harnessed by means of better organization
and capital. Capital is expensive and can be employed
to a great degree only in producing for large numbers..
The masses consume in order to satisfy their wants.
Wants are developed by social opportunity, which can
be had only with leisure and wealth. Therefore, to-
increase and cheapen the production of wealth and to-
promote progress we must increase the leisure and
wealth of the masses.

DISTINGUISHED ECONOMISTS
VII — WILLIAM STANLEY JEVONS

Stanley Jevons represents the datum line between
the old school of economics and the new. His theory
of political economy, which was published in the early
'70*8, was an attempt to reduce economics to an exact
science by the use of algebraic formulae. He was one
of the earliest English writers openly to attack the
Ricardo-Mill school. His book, "Theory of Political
Economy," like most economic works at that time was
•chiefly devoted to the discussion of value.

The point of view on value, introduced by Jevons,
was neither cost nor quantity but utility. He first,
however, made a real contribution in brushing away in
-a somewhat impatient but most vigorous fashion the
rubbish that had hitherto been worked over in econom-
ic writings about the different kinds of value, as value
in use, natural value, market value, value in exchange,
all of which he showed, with a wholesome clearness,
was unnecessary clutter. What from the time of Adam
Smith had been laboriously written about as value in
use Jevons showed, with a clearness not to be mistaken,
is simply utility or usefulness, and not value at all. He
pointed out in a convincing manner that value is
neither more nor less than a ratio of exchange ; that it is
not a quality or attribute of a thing but simply the ratio
oetween two things.

His book was largely devoted to an elaborate dis-
cussion of utility as the motive for all economic action.
Utility being the quality for which all things are de-
sired, is, according to Jevons, the basis of exchange.
He affirms that the value of commodities in any market
tends to uniformity, not on the basis of their cost of
production but on the basis of the utility of the article
to the consumers. Since every article has a different

29

30 GUN TON'S MAGAZINE

utility to almost every consumer, some Saving a much
stronger desire than others for the same thing, the final
utility is the utility to those to whom it is least desira-
ble, who are willing to give the least for it. The

theory is that what those will give for the article to
whom it is least useful, or least attractive, fixes the
price for the whole market, because the least that some
will give for it is the most that all will pay.

This " final utility " or " marginal utility " doctrine,
which has been considered at length elsewhere*, has
become the basis of what is known as the Austrian
School, and has received considerable approbation
among the younger economists of this country. To
belong to the new school has almost become a fad in
certain quarters; but the Austrian economists have not
kept the doctrine as simple and clear as Jevons left it.
The more the " final utility" theory is discussed the
more clearly it appears that it contains very little that
will be a permanent contribution to the science. In
reality the great kernel of economic truth that was in
the Ricardian theory of rent, — the doctrine of marginal
cost, — is likely after all to prove the true law of value.

The new school which branched off with Jevons,
however, has done much to liberalize the discussion of
the subject. It has given respectability to economic
protestantism. It is no longer necessary to be ortho-
dox in economics in order to be respectable or to obtain
a hearing. The crude statement of supply and demand
as the solvent of all value phenomena, and laissez faire
as the controlling formula for public policy, have been
exploded and really relegated to the rear. If the work
of Jevons and the new school accomplishes nothing but
this, it has justified its existence, and for that we should
be thankful.

*See "Principles of Social Economics," by George Gunton, pp.
184-199. Also, " Practical versus Metaphysical Economics," in GUN-
TON'S MAGAZINE for February, 1897.

EDITORIAL CRUCIBLE

IN HIS VISIT to Atlanta the President said a great
many things which will go far to reduce the last rem-
nant of sectional feeling in the ex-confederate states.
The suggestion that possibly the graves of confederate
soldiers in the national cemeteries should be cared for by
the government the same as those of the federal sol-
diers seems to have touched a responsive chord through-
out the South. And as if to complete the work of
touching, almost before the President gets back to
Washington a bill is introduced to grant pensions to
confederate soldiers. To say the least, this is injudici-
ous. The real friends of the South, who are desirous
of burying all offensive references to the confederate
cause, would better go a little slow on the confederate
pension business.

MORE THAN one hundred thousand people in New
York City are suffering from the Grip. This is the reward
for having put the care of its streets in the hands of
Tammany. Heaps of mud and impeded gulleys, with
the daily contributions of refuse from one end of the
city to the other, are ample cause for epidemics. There
never was a time when filth would not create disease.
It scourged Europe with the ' * Black Death " in the
fourteenth century; it has several times depopulated
London and other large cities with cholera, smallpox,
yellow fever and other malignant diseases. It occasion-
ally prostrates one of our southern cities. It annually
mows down those who are not immunes in Cuba. What
filth, neglect and sanitary incompetence does in all
other times and places it will do also in New York.
With the minimum opportunity, Tammany can be re-
lied upon to guarantee pestilence every time.

31

32 GUNTON'S MAGAZINE [January,

THE ANNUAL CONVENTION of the Federation of
Labor recently held at Kansas City did great credit to
the labor cause in putting itself clearly on record against
socialism. It has been a part of the scheme of socialists
everywhere to join "the union," not because they be-
lieved in the work of unions but in order to get posses-
sion and control of the organization for socialistic pur-
poses. At the convention in Kansas City, Mr. Gom-
pers, who has always been definitely opposed to social-
ism in the unions, led the attack on the socialists, and
succeeded in getting resolutions passed declaring that
the object of the Federation is strictly to improve the
conditions of the wage class, and in no sense to organ-
ize a political movement for the overthrow of the wage
system. In doing this Mr. Gompers has' rendered a
real service to the cause of organized labor everywhere.
Let the trades-union movement get thoroughly infected
with socialism, and the whole community will be
against it. The hope of friendly aid for labor legisla-
tion will then be gone. Those who try to convert the
trades-union movement into a socialist propaganda are
the real enemies of the wage class.

IN THE Forum for December, Prof. J. B. McMaster
makes a valuable contribution to political literature,
under the title of * ' Annexation and Universal Suffrage. "
It is a complete review of the history of expansion and
territorial government in the United States. Prof.
McMaster shows beyond question, both from practice
and interpretation of the constitution, that the new ter-
ritories need not in any way be governed under the
constitution, — that they can be, as all our territories
have been, governed by Congress wholly independently
of the constitution. We are under no obligation, there-
fore, either traditionally or constitutionally, to make the
new territories any part of the United States. Prof.

i899.] EDITORIAL CRUCIBLE 33

McMaster shows that they can be and ought to be gov-
erned by political institutions adapted to the people,
without any regard to the institutions of the United
States. This is good sense, besides being good politi-
cal doctrine. The idea of annexation, in the sense of
making the new territories a part of the United States,
should not be tolerated for a moment. The new pos-
sessions should be treated as distinct colonial political
communities, and not as territories waiting to be ad-
mitted to statehood at the first political emergency.

HON. JOSEPH H. WALKER, present Chairman of the
Committee on Banking and Currency in Congress, has
been speaking rather plainly regarding the status in
Congress on currency legislation. No one knows the
real inside conditions on this subject better than Mr.
Walker, and few really understand the money question
as well. Mr. Walker predicts that * ' There will not be
any currency reform legislation or any general banking
or currency legislation passed by Congress before 1904."
This means that neither the present Congress nor the
one elected this year, nor the present administration,
will do anything effectively to improve our banking and
currency system.

If this be true it is a calamity, and yet the Presi-
dent's Message and the reports of the Controller of the
Currency and the Secretary of the Treasury, seem fully
to justify Mr. Walker's prediction. The Secretary of
the Treasury's recommendation for a reform in the
banking system is frankly antagonized by the Controller
of the Currency. Thus the President's two Secretaries,
occupying opposite positions on this important subject,
neutralize each other. If this be true, the nation will
have good cause to be disappointed with the Republican
administration and everybody knows what happens to a
party with which the nation is disappointed.

34 GUNTON'S MAGAZINE

THE WORK of industrial consolidation seems to be
" going bravely on." The pottery manufacturers have
completed a trust organization; the tin plate manufac-
turers have done the same thing. This is in accordance
with the natural trend of events; but it is to be hoped
that these new trusts will not lose their heads and try
to use their larger corporate power for uneconomic
purposes. It frequently happens that in the organiza-
tion of a trust there are a few persons near the center
of authority who do not know any better than immedi-
ately to use their new power to put up prices, or do-
some other absurd, uneconomic thing which is sure ta
bring down upon them the indignation of the commun-
ity and much unjust criticism, and sometimes mischiev-
ous and harassing legislation. The community is
justified in antagonizing any new mode of industrial
organization or introduction of any new methods which
result in raising the prices of the products. Capitalists
are justified in any effort at improved organization for
the purpose of increasing the success and enlarging the
profits of the business, but to be economically justified
they must obtain their increased profits out of econo-
mies and better methods resulting from their new or-
ganization, not out of higher prices. In a few instances
the folly of increasing profits by forcing up prices has
been tried, as in the case of the copper trust, the nail
trust, the cordage trust, etc., and they have failed; not
only failed to maintain their higher prices and larger
profits, but even in maintaining the principal invested
in the business. It is to be hoped that the pottery
trust and tin plate trust will not commit the fault of
using their larger corporate power even temporarily to
increase prices, and thus justify the growing antagon-
ism to capital, which may some day legislate them all
out of existence.

Civics AND EDUCATION

TEACHING OF ECONOMICS IN SCHOOLS

Some years ago the state of New York made the
teaching of physiology and hygiene compulsory in the
public schools, and almost all the states require temper-
ance instruction of some sort. The justification for this is
that ignorance of the laws of health is a menace to the
public welfare so grave as to warrant drastic and thor-
ough-going measures for its removal. The evil results
of this ignorance affect, or may affect, not only the
children themselves but the whole community. Further-
more, the danger increases as our population becomes
more dense and civilization more complex. Within the
last few decades our towns and cities have multiplied in
number and quadrupled in size, and with the crowding
together of families in tenements have come sanitary
problems that do not exist in rural communities. Un-
clean and slovenly habits, however disgusting in them-
selves, are after all less dangerous where people lead
an out-of-door life and there is an abundance of land
and running water and fresh air to counteract the effects
of insanitary living conditions. If disease is develop-
ed there it cannot become an epidemic. The very is-
olation of farm life constitutes a natural quarantine
almost as effective as the edicts of a Board of Health. A
pig sty in the door yard of a farmhouse is not admirable,
whether from the viewpoint of fragrance or scenery,
but it may not kill anybody; whereas the same institu-
tion in the rear area of a tenement house might develop
a pestilence within a month.

And then, the very complexity, the haste and
worry, the high pressure and nervous tension of modern
life, have made education in the laws of health abso-
lutely imperative. If such a pace were to continue

35

36 GUN TON'S MAGAZINE [January,

without any counterbalancing restraints, a few gener-
ations would show marked racial deterioration. We
have been forced to see the necessity of rest, of recre-
ation, of travel and outdoor exercise, and not only see
it but establish the habit of it in those who are growing
up, before they get into the whirlpool of business and
social and public affairs. So it was a wise statesman-
ship that prompted compulsory education in the laws of
health, and the more the emphasis is laid on this all-
important object, rather than on mere technicalities of
physiology and anatomy, the more completely will the
real purpose of this policy be realized.

Now, we are fast reaching a point where the same
necessity ought to be recognized in regard to another
and equally important subject. We are most seriously
in need, in this country, of wise training for citizen-
ship, and not only for citizenship but for capacity to
meet and deal intelligently with the social and econom-
ic problems that touch us on every hand. In fact, the
case is very similar to that of health instruction. It is
only since our national life became so complex and
many-sided, and our whole industrial system reduced
to a sort of clock-like machine with all the parts depen-
dent upon each other, that the necessity for education
in economic and social questions has arisen. Just as
sanitary knowledge was not vitally important when
most of the people lived apart from each other and na-
ture was the universal scavenger, so a knowledge of the
laws that control in the great business, social and polit-
ical world was not greatly required when industry was
simple and crude, and trade limited, and families made
nearly everything they needed by their own labor. A
calamity suffered in one place expended its force there,
and hurt practically nobody but those directly affected.
Now, however, a mistake, or a disturbance, or a wrong
tendency, or a degrading influence in society, is felt

1899.] TEACHING OF ECONOMICS IN SCHOOLS 37

throughout the community. Nobody, whether he re-
alizes it or not, entirely escapes some measure of the
result. And, this is a far better, far more healthful
condition than the old. Formerly, if a few families
were wiped out by disease, or a man failed in business
or lost his position, or another had his wages reduced,
or whole communities were living in poverty and deg-
radation, why, it was their own affair and nobody else
was particularly affected by it one way or the other.
Therefore the conditions that caused these misfortunes
could be neglected, and were neglected. Society
would do nothing to correct these evils, simply because
society was not injured by them.

But to-day it is far different. Business failures
react on large groups of investors, and disturb credit
everywhere. Men thrown out of employment form a
class of unemployed, and either develop into paupers
and tramps, to be supported by all the rest, or become
revolutionists. A reduction of wages is no longer an
individual matter but applies to whole groups of em-
ployees, and the cause of one man or one set of wage
workers is taken up by vast labor organizations, because
they feel and know that if anywhere a backward step is
permitted the whole labor cause is weakened. In the
same way, if a community permits great masses of
population here and there, especially in the great cities,
to exist in ignorance and hardship, and grow embittered
and resentful and vengeful, and does nothing to start
them on the road out of their poverty and degradation,
then it will have ignorant and vicious demagogues
elected to public office and fanatical laws aimed at
property, destructive of business prosperity. This is
exactly as it should be, because it makes it impossible
for one part of the community to neglect the unfortunate
lot of the other and still remain in security itself. It
makes wise philanthropy and wise statesmanship not

38 GUNTON'S MAGAZINE [January,

only desirable but absolutely imperative. One part of
the nation cannot progress indefinitely while the other
lags farther and farther behind. Of old it was not so,
but to-day we must stand or fall together.

And so it is that we have come now to the point
where a better and more universal understanding of
these problems is a solemn and urgent necessity. If
we would keep our nation on the high road of progress
we must know how to make the track safe and keep up
steam in the engine, — yes, and understand the mechan-
ism of the engine itself.

These problems are not far-away, abstract matters.
They touch us on every side. The very word " econo-
mics " doubtless has come to suggest a lot of remote,
dry, perplexing and bothersome matters that have no
part in common everyday life and offer nothing prac-
tically useful. This feeling is due to the way in which
the subject has been presented and taught and talked
about in our colleges and text books, and on lecture
platforms. In reality, no subjects come nearer the
everyday life of the people than those covered by this
much disliked and misunderstood " economics." Every
young man about to choose a business or profession
needs an economic education ; needs to know the laws
of prices and wages, and the conditions of business
success, and the public policies that will make for his
own prosperity and the prosperity of the community on
which he depends. Or, if he is going to become a sal-
ary- or wage-earner, he needs to know the laws of
wages and the philosophy of labor organizations, their
objects and methods. To an increasing extent this is
becoming true, also, of young women, — those who are
earning independent livelihoods and form a growing
portion of the wage class, having common interests
with reference to wages and hours of labor and working
conditions. They need to know that these interests can

1899-] TEACHING OF ECONOMICS IN SCHOOLS 39

be materially helped by acting together, according to
correct methods, and by creating public opinion in
favor of wise laws in their behalf.

Furthermore, in this day and age voluntary phil-
anthropy is more widespread than ever before. People
are even seeking for opportunities either to bestow
charity or to aid in practical reform movements. It is
of the highest importance that all such efforts should
be guided by intelligent understanding of what things
really help and what may, on the other hand, actually
hinder the work they are trying to do. Probably the
.greater part of the money contributed and expended
for charitable purposes to-day is worse than wasted, be-
cause it actually increases the very evils it seeks to re-
move; and this does not apply merely to soup kitchens
and indiscriminate alms-giving but very largely to the
organized charity societies themselves. Half of the
amount given in charity, if spent on sound economic
education with the result of diverting the other half to
the support of movements and agencies that really
make for social progress, without pauperizing those
whom they touch, would go far towards transforming
the whole situation.

No, these things are not far-away and abstruse.
Every pauper who knocks at your door represents a
great social problem that you ought to understand. So
does every insanitary tenement, every sweatshop, every
dirty street, every corrupt public official, every child
turned away from overcrowded schools, every unwise
or dishonest public policy. Every reduction of
wages, wherever it occurs, represents some economic
condition that you ought to understand. Every
improvement in public conveniences and service, or in
methods and results of industry or trade, has an eco-
nomic cause, and you ought to understand how such
tendencies can be helped along. Every political disas-

40 GUN TON'S MAGAZINE [January,

ter, resulting in the success of unprincipled men or
dangerous policies, represents a bad social or political
condition, and you ought to understand that condition
and know what forces can and should be aided in
breaking up the stereotyped indifference of the people
and starting the current of progress toward better
things.

How shall this understanding be obtained ? Only
by education. In the case of adults, about all the op-
portunity that is offered in this direction is in the col-
leges and universities, and there the type of teaching is
still so largely shaped by the negative, "let-alone"
ideas of the English classic school that in many cases
the courses might better be omitted entirely, and the
young men left to deal with the practical problems of
life in the light of their own common sense, even if
they do make some mistakes. Give us men who be-
lieve in the possibility of doing something and are will-
ing to work towards it, even half blindly, rather than
mental paralytics, as it were, who have come out of col^
lege so drilled in the dangers and drawbacks of all pro-
gressive action that they simply stand aside from the
onward work of the world, critical, cynical, indifferent.
The education of the future on these subjects must be
positive, wholesome and optimistic. It must not take
up any problem except with the view of suggesting
some practical and effective way of solving it. There
is a movement in the colleges in this direction, fortu-
nately, but the number of people reached by these in-
stitutions is altogether too limited to give the results
needed to-day. Much more could be accomplished by
the University Extension plan, or local study clubs.

But most important of all, perhaps, is the necessity
of introducing the study of these subjects in the public
schools. Economic instruction, of a kind and degree
adapted to the different grades, of course, ought to be

TEACHING OF ECONOMICS IN SCHOOLS 41

made a part of our whole educational system from top
to bottom. The public schools reach almost the entire
population, and there it is that first impressions are
made and ideas formed. Is it any wonder that most
grown people have so little comprehension of these sub-
jects, as composing an actual science, when not one
word has been said about them in all the years of their
school life? And, is it any wonder that the ideas of
most people on social economics are so confused, chaotic
and indefinite when they have been practically pro-
hibited from learning anything about it until they are
suddenly thrown into practical life and meet some phase
of it every day. It is made clear to them in school that
the subjects they do study are governed by general
principles or laws, but they are practically left to as*
sume that the industrial and social and political affairs
that will absorb their thought and attention throughout
life are governed by accident, luck or chance. There
is a really serious lack here in our educational system,
that demands earnest and careful attention.

Although it may not be either feasible or desirable
to make economic instruction imperative, as in the case
of physiology and hygiene, yet public sentiment ought
to be developed as rapidly as possible in favor of intro-
ducing it in the public schools. It is entirely practica-
ble. Civil government and elementary economics are
already taught in many of our high schools, and we
have now a working organization in New York state
urging that civics be taught in the common schools.
The subject is broad enough to permit of gradual devel-
opment throughout the entire school course, in forms
adapted to the different grades. In all subjects taught
in schools it is found that as we go down from the upper
to the intermediary and primary grades the instruction
must deal more and more with concrete things, rather
than with abstract ideas. This of course would apply

42 GUNTON'S MAGAZINE [January,

also to whatever was attempted in the way of industrial,
social and political education.

Strange as it may seem, the kindergarten, dealing
with the very youngest group of all, recognizes the
principle that no great important side of life should be
omitted from a scientific system of education. These
tots, scarcely out of the nursery, are shown, as a part
of their very play, how certain fundamental industries
are conducted; how agriculture is carried on, how people
buy and sell, how railroad trains are run, and even how
elections take place. When a public holiday comes
around they are told its meaning, and made familiar
with the flag and, as simply as possible, with a few of
the great events with which it is connected.

Now, is it not an anomaly that from the time a
child leaves the kindergarten until he enters college he
learns practically nothing more on all this class of sub-
jects? In the very next grade, the primary, instruc-
tion could be continued in regard to the more simple
and obvious phases of industry and trade, and as soon
as the study of history and geography is begun it could
and should be accompanied by industrial history, de-
scriptions of conditions of work and ways of living in
different countries, and the effects thereof on the gene-
ral character of the people. Certainly this would be no
more difficult of comprehension by pupils of ten than
the instruction already given to children of no more
than seven or eight years of age in regard to the effects
of alcohol and narcotics, impure air, bad drainage, etc.,
upon health. At a little later stage, industrial history
could be given with more of a philosophical element in
it; that is, with the constant purpose of showing the
causes of the great industrial changes that have taken
place, especially since the Middle Ages, and the effects
of industrial conditions upon the home life, the intelli-
gence, religion, and political rights of the people.

T899-] TEACHING OP ECONOMICS IN SCHOOLS 43

The possibilities of this sort of instruction were
demonstrated in the School of Social Economics before
it was merged into the Gunton Institute. One large
•class of boys and girls, fifteen, sixteen and seventeen
years of age, was given regular lectures in industrial
history, showing the relation of industry to social and
political life and including descriptions of old and new
methods of industry, the great inventions and changes
of the last hundred years, the rise of the factory system,
and wage system, the labor movement, and so on. It
was made plain from the experience there that pupils
•considerably younger would have been able to compre-
hend and profit by practically the same course.

The other class, ranging in ages from sixteen to
•eighteen, and some nineteen, received regular instruc-
tion in economics, covering the principles of social
progress, wealth, 'capital, prices, wages, profits, rent,
interest, money and banking; also, such public policies
as taxation, protection, free trade, factory laws, etc.
They even went into analysis of proposed social re-
forms, such as socialism, single tax, free silver and the
like.

These latter topics would undoubtedly be too ad-
vanced for any grade of grammar school work, but
they should be made an important feature of the high
school curriculum. In the higher grades of the gram-
mar schools, however, scholars might have instruction
in the forms of civil government and also a course in
industrial history fully as comprehensive as was given
to the younger class in the School of Social Economics.
Pupils of that age also ought to be old enough to learn
what a bank is, what a corporation is, what law is, why
we need laws and how they are enforced. They ought
to be taught patriotism and the meaning of good citizen-
ship; ought to know what good city government de-
mands in the way of clean streets, plenty of schools,

44

GUN TON'S MAGAZINE [January^

parks and libraries, honest elections, honest officials.
At the George Junior Republic, near Freeville, New
York, it has been shown that young boys and girls, even
from the slums of New York, not only are able to com-
prehend such matters intelligently but can even govern
themselves and carry on a little republic almost inde-
pendently of adult help. Furthermore, at this age,
scholars might be shown in a rudimentary way the
great simple principles which determine the wages of
the different sorts of laborers they see at work all about
them, and the laws that fix the prices of the things they
see displayed in the stores, and also could have ex-
plained to them the influences in domestic and village
and city life, and in the nation, that are wholesome and
ought to be encouraged, and those that are not and
should be opposed.

Does this require too high an order of talent in
teachers? Not if the subject is reduced to a system and
a proper variety of text books prepared, with reasonable
regard to the capacity of different grades, and the whole
embodied in the educational process just like any other
subject now so included. Teachers would not be able
to give instruction even in such subjects as geography,
history, physiology and the simple natural sciences but
for the fact that these are established topics to which
the best thinkers in educational work are devoting their
time and study, and on which the best text books that
money can procure are being written and used. But,
if this new line of instruction should really mean that a
somewhat higher grade of talent in teachers is neces-
sary, then so let it be, and the community ought to be
ready to pay the higher salaries necessary to procure it.

Of course, it must be admitted that the chief value
of the instruction that could be given to children of
from twelve to fifteen years of age would be as a prep-
aration for continued work of the same sort in high

.1899.] TEACHING OF ECONOMICS IN SCHOOLS 45

.schools and beyond. But even with the great mass of
children who get no farther than the grammar school ,
it ought to be possible to lay the foundations for clear
ideas on many of the economic problems they will en-
counter later in life. In whatever is taught up to this
time, the emphasis could be laid on certain fundamen-
tal ideas in such a way as to leave impressions, at least,
that will be developed by experience into clearer think-
ing and more intelligent conduct than would otherwise
have been possible.

The civilized world agrees that young persons
must learn how to write, to read, to count, and
must know the principal facts about the earth and its
people, and the chief points in the history at least of
their own country. But men had to live and get a liv-
ing before writing or reading or mathematics were
known, and before geography meant anything more
than forest trails and rude stockades, and before there
were any historians other than savage cairn-builders, or
nature herself, writing her own story and blotting out
man's. Those were the times when men lived, fought
and labored each for himself and against the other.
But men needed to understand each other, and lan-
guage appeared, and each generation taught it to the
next. They needed to trade with each other, and
mathematics appeared, and was handed on down.
They needed to live together, and government ap-
peared, and was learned by the young men from the
fathers. And now we have to come to the point where
we have to work together for the very means of life, and
we are interdependent, and none can exist alone. This
is the last and most important step of all, and only lately
have we been rinding out how thus to work together for
the best and completest good of all. To teach what we
have so far learned is the next and present duty.

H. HAYES ROBBIN

CIVIC AND EDUCATIONAL NOTES

The students of Princeton University have almost
unanimously abolished hazing, and appointed a perma-
Hazin abol- nent committee to enforce this prohibi-
ished at tion. Coming from an institution so-

Princeton near the top in athletics, this action shows
a growing appreciation of the difference between legiti-
mate manly sport and brutal rowdyism. Numerous-
other colleges had, morally at least, set this example
prior to the action of the Princeton students, but there
are yet many others that ought to be in line. Within a
few months, for instance, the public has had occasion
to know that Columbia is somewhat in need of the
same reform that has been instituted at Nassau.

Contact with superior conditions or superior types
of people, when these superior conditions and types are
Where not set off by superstition or despotism

Education is in unapproachable groups by themselves ,
not Wasted is a pOwerfu] incentive to progress and
improvement. It is for this reason that we find, what
at first glance seems a surprising thing, that there is a.
very widespread and earnest ambition for education
and important position in life among the children of
the East Side poor in New York City. The work of
the mission societies and social settlements does much,
of course, to stimulate this wholesome discontent and
ambition. The consequence is seen nearly every fall
when the children of the East Side apply almost en
masse for admission to the public schools, and a con-
siderable number of them regularly have to be turned
away for lack of accommodations.

How serious a matter this is cannot fully be real-
ized until one comes to study and understand the laws
and methods by which the progress of civilization goes.

46

CIVIC AND EDUCATIONAL NOTES 47

on. It is precisely the function of wise public policy
or private philanthropy, first, to introduce into these
sections elements which will create ambition and dis-
content with inferior conditions, and then, when the
movement for something better has been started among
these people, to furnish them opportunities for acquir-
ing the education they desire, and aid them in estab-
lishing better living conditions. What encouragement
can workers for social elevation in the slums have when,
after all their efforts to stir up desires for something
better among these people, the opportunities for such
progress are not furnished by the municipality?

Last winter the present city government of New
York blocked the construction of new school houses, on
the ground that the debt limit of the city had been
passed. This fall, therefore, the Board of Education
included its estimate for new school houses in the an-
nual budget, to be raised by taxation. The Mayor, in
order to dodge this, and gain to his administration the
humbug credit of keeping down the tax-rate, see-saws
again on the matter and cuts out $10,000,000 requested
by the Board for some twenty-eight schools, explaining
that this will have to be covered sometime in the future
by bond issues! Doubtless, when the question of issu-
ing bonds for these school houses is brought up, it will
again be discovered that the debt limit prevents it.

If ever there were cause for discouragement over
the prospects of municipal progress in this country it is
when we find, here in the metropolis, an administration
hostile, apparently, even to one of the simplest funda-
mental functions which good city government ought to
perform, and this purely to make political buncombe
for campaign purposes. There is one cause for gratifi-
cation at least, namely, that this utterly narrow-minded,
selfish and backward type of governmental policy was
not, in the recent election, extended to the state as well.

SCIENCE AND INDUSTRY

DECLINE IN RAILWAY RATES AND PROFITS
JOHN MOODY

The evolution of commerce and industry during
the past generation is perhaps more interesting to the
student of economic science than any other phenomenon
in the whole range of progress. The vast increase in
the world's wealth, brought about chiefly by the labor-
saving inventions and discoveries of the present age, has
been peculiarly far-reaching in its effects, and has
wrought significant changes in all walks of life. But it
is to be noted that the general tendency of change has
been distinctly from a lower to a higher plane, from less
to more civilization. Wealth of all kinds is more read-
ily accessible ; it is cheaper and within the reach of
many, where formerly it was only at the command of a
few. All the many changes in the methods of produc-
tion have tended to cheapen wealth, through lowered
cost, and consequently have given us lower prices.
With lower prices (or less nominal return on capital) in-
terest rates (also return on capital) have naturally fallen
in about the same ratio.

Now there is a generally prevailing impression that
the actual return on capital has materially decreased
during the past fifteen or twenty years. It is constantly
pointed out and used as an unanswerable argument that
whereas the capitalist could formerly put out his funds
at an average rate of 6 per cent, to 8 per cent. , he can
now barely realize 3 or 3^ per cent. Hence, it is said,
his income has been practically cut in two. But the fact
is forgotten that while nominally his rate of income has
been much lessened the actual return on his money has
by no means fallen in the same ratio. The real value of

48

DECLINE IN RAIL IV A Y RA TES AND PROFITS 49

wealth is always to be ascertained by its buying power,
and it requires but little examination of the subject to
see that the investor's 3^ per cent, to-day will produce
about as much real value (in commodities) as 7 per cent,
formerly would. Prices and interest rates being practi-
cally identical and governed by the same law, they have
fallen in about the same ratio. They have both fallen
by reason of cheapened cost of production, chiefly
brought about by the world-wide use of labor-saving
appliances and methods.

This economic movement has been nowhere more
conspicuous than in this country. Everywhere in the
United States the nominal rate of return on capital has
tended downwards and is still aiming in that direction.
Perhaps nowhere has this tendency been more con-
spicuous than in the railway world; and it is here,
where I have been at special pains to gather facts and
and illustrations, that the movement can be more clearly
shown and proven ; for the railways are affected by the
changes and vicissitudes of all trades and industries
from one end of the land to the other. Being, as they
are, like the bloodvessels of the body, a vast network of
vital strings which enter into and are affected by the
condition of every part and section of the body itself,
nothing connected with commerce, industry or enter-
prise can fail to affect them either favorably or adversely.
Many industries are directly intertwined with others,
some are indirectly connected and still others are in no
way dependent on or connected with any other; but the
railways are directly connected with and dependent on
the success of practically every other form of industry.

The rate of return on money invested in the rail-
ways has radically decreased during the past fifteen or
twenty years. I have selected seventeen of the largest
railway systems of the country and figured out the aver-
age net return on capitalization (stocks and bonds) in

50 GUNTON'S MAGAZINE [January,

1880 and 1897. In 1880 this was 10. i per cent.; in 1897
it was 4.6 per cent. While these figures are only
approximately accurate, as the stocks of some of the
companies only partially represent actual cash paid in,
yet the downward tendency is clearly shown.

A statement of this kind causes many to conclude
immediately that the railways are on the whole about 5 5
per cent, less profitable than they were seventeen years
ago. Nominally they are, but measured in real wealth
they are actually earning about as much as when they
returned 10 per cent, upon their capital in 1880. In
fact in this period wealth itself has been cheapened to
just about this extent. The average buying power of
money for everything (except labor) has increased in
the same ratio. This does not mean that gold, the
measure of value, has appreciated per sey as the silver-
ites claim. . If this were so the price of labor as well as
of other commodities would also have fallen. As a
matter of fact, however, the price of labor, like that of
some other commodities independently affected, has
risen materially. This is well; for the welfare of the
community depends almost entirely upon the buying
power of the dollar in its relation to human labor.

This wealth-cheapening tendency is, to my mind,
a purely economic one and is therefore inevitable. The
average investor in railway properties who complains
because his return does not equal that of a dozen years
ago is simply butting against a stone wall. To ask for
8 per cent, today because he received it fifteen years
%o, is practically asking for twice as much as he
received then. Possibly it costs him more to live now,
but he lives better, has more comforts and gratifies more
wants. If he lived today precisely as he did then, he
would often find himself with far more cash on hand
than he now has. Statistical records prove this clearly-
enough for the satisfaction of the most skeptical.

1 899.] DECLINE IN RAIL IV A Y RA TES AND PROFITS 51

A careful analysis cannot but justify one in the
conclusion that it has been largely due to the overlook-
ing of this world- wide economic movement — this ten-
dency to a nominal decrease in return — that so many
of our railroads have been forced into bankruptcy dur-
ing the last half dozen years. There have been in
many cases other, though principally temporary, causes
which have operated to the detriment of various railway
lines, but a brief examination of the subject will prove
this to have been the underlying one. The great rail-
way companies of this country were originally bonded at
from 6 to 10 per cent., many with long time obligations
not maturing for years to come. In those days finan-
ciering of this kind was looked upon as extremely con-
servative, for in view of the prosperous condition of the
country, its rate of growth and future possibilities, even
the least sanguine could not fail to see visions of enor-
mous returns not only on cash actually invested but also
on securities which represented little more than ' « good
will " and voting power. And for a time these predic-
tions seemed to be verified. But capital being attracted
by abnormal profits, abnormal extensions in building
took place, cutting down profits through increased com-
petition and less profitable expenditures. And during
all this time the economic forces which I have referred
to were at work ; freight and passenger rates were stead-
ily declining year after year while the costs of operating
were reduced in a far less degree, and interest charges
remained practically the same. Then began the move-
ment for self -preservation, which many companies sought
in consolidation, hoping thereby to achieve economies in
management, lessen disastrous competition and so in-
crease net returns. Great gains were made in this way,
but as the world-wide tendency of profit still continued
downwards, while interest chajges could be in no wise
materially reduced, a limit was soon logically reached.

52 GUNTON'S MAGAZINE [January,

By this time many of the large companies had
abandoned dividends and were struggling keenly to
keep themselves solvent and take care of current obliga-
tions. Many were sailing far too closely to the wind,
and occasionally when special causes entered in, such
as poor crops, bad management, or a particularly heavy
bonded debt, disaster was the only outcome and receiv-
erships became all too plentiful. Then came the panic
of 1893 with its attendant disasters, and the end of the
following year found more than fifty thousand miles of
railway in the hands of the courts.

While the direct cause of this condition of things
was the general financial collapse which overspread the
land during the panic, it will be found that very few of
the railroads would have been forced actually to assign
had it not been for the fact that while the percentage of
return on their capital had steadily tended to decrease,
their interest charges had remained practically rigid and
could not be reduced. This is proved by the figures
furnished by the Inter-State Commerce Commission re-
ports, which show that passenger rates fell from 2.349
cents per passenger mile in 1888 to 2.004 cents in 1895,
a decline of fifteen per cent. ; and freight rates, which
in 1888 averaged i.ooi cents per ton mile, in 1895 were
but .839 cents, a decline of nearly 20 per cent. As
compared with this, " Total deductions from Income,"
or fixed charges exclusive of dividends, increased from
$2,242 per mile in 1889 to $2,396 in 1895.

Thus, we trace the primary cause of railway disas-
ter in this country to the single fact that through
the inevitable working of economic forces and through
no apparent fault of their own many companies found
themselves paying far above the current rates of inter-
est on the bulk of their loans. This condition of things
was in the majority of cases unavoidable and could not
have been foreseen, but it was undoubtedly the im-

1899- ] DECLINE IN RAIL WA Y RA TES AND PROFITS 53

portant factor in the railway crash of a few years ago.

Since this time a complete revolution has taken
place in methods of railway finance. The finances of
more than 60,000 miles of railway have undergone reor-
ganization or readjustment since 1893, and in many rad-
ical changes which have been made the falling tendency
of interest and freight rates has constantly been kept in
view. From organizations with burdens that handicap-
ped them at every turn, nearly all have got down to
a modern business basis with outstanding obligations
funded at 'something near the prevailing interest rates,
and with provisions for further reductions in charges in
the future. This is as it should be, for although we
may not expect any more receiverships at present there
is nothing to indicate that rates will not fall still lower
in the years to come. Combinations in and the pooling
of rates, even if finally legalized, are but temporary ex-
pedients, as the inevitable working of economic law has
proved again and again.

How far this economic movement which is so evi-
dent all around us will continue, it is impossible to say.
It is clearly governed by cost, but concentration of
effort and economy of operation have a limit somewhere,
and the point of minimum cost must one day be reached.
But to say where that point is would be the merest
speculation. Causes are constantly operating and will
continue to operate, to an extent which it is indeed diffi-
cult to guess. See the revolution which has taken place
in the methods of street railway transportation during
the past few years. On every side we see new ideas
and new methods of production and distribution devel-
oped every day, and what kind of a civilization will
finally evolve out of the present progressive but rapidly
changing state of society no man can tell.

SCIENCE AND INDUSTRY NOTES

A table recently published in the Railroad Gazette
reveals some interesting facts in regard to surface and
Electricity elevated railway travel in New York
and Rapid City. Since about 1 891 there has actually
been a decline in the amount of travel on
the elevated railways, and an increase in that on surface
lines. During the years 1895 and 1896 this increase in
surface railway travel was very marked, rising from
about 265,000,000 to 380,000,000 per annum. • This has
taken place since the wholesale abolition of horse cars
and consolidation of street railway lines. Elevated
railway travel declined between 1891 and 1897 from
about 213,000,000 to 1 8 2, ooo, ooo passengers per annum.
It is to be hoped that this is an indication that New
York City will not be defaced by any more of these
hideous, unsightly, noisy and dirty overhead structures.
If the remarkable improvement in the quality and effi-
ciency of surface road accommodations results in head-
ing off the necessity for extension of the overhead sys-
tem, this achievement will not be the least among the
vast benefits that electricity has conferred upon the
populations of large urban centers.

Little by little the truth that prices ultimately rest
upon the cost of production and are not governed merely
The Low by supply and demand gains recognition.

Price of Even in the case of the low price of cot-

ton, which has almost universally been
attributed to excessive supply, the fact is finally being
developed that at bottom of this declining price there
has been a steady reduction in the cost of producing raw
cotton. On this point Bradstreefs says, in summarizing
the results of an investigation made by the Journal of
Commerce: —

54

SCIENCE AND INDUSTRY NOTES 55

" The answers received indicate that there is a gen-
eral consensus of opinion to the effect that the reduced
price of cotton does not imply any setback to the gen-
eral business prosperity of the South. It is recognized
that the cost of producing the staple has been materially
lessened during the years of steadily-falling prices, the
cost of production in some sections being only one-half
of what it was ten years ago. The belief is expressed
that 5 -cent cotton will, as a rule, leave a moderate profit
to the grower."

It would seem as though the fact that along with
the steadily declining price of raw cotton its production
has increased year after year, ought to have been evi-
dence enough that reduction in the cost was the real
factor that made the lower prices possible, rather than
mere over-supply. Had it been over-supply alone,
without a diminished cost, all the cotton producers
would have gone into bankruptcy or else ceased pro-
ducing. It is this same law which has operated in the
-case of wheat and of silver; both of these products have
been steadily declining in price and yet their produc-
tion has increased year by year. In other words,
.although the operation of the law is often more obscure
and more frequently interrupted in the case of agricultu-
ral than of manufactured products, it does at bottom
operate just the same, and is the primary cause underly-
ing all great price changes.

CURRENT LITERATURE

BOHM-BAWERK ON KARL MARX*

Few books published since the middle of the cen-
tury have caused more disturbance in economic thought
than Karl Marx's " Kapital." Marx is the prophet of
"scientific socialism," and his " Kapital " is the Bible
of the revolutionary movement throughout Christen-
dom. It impeaches the integrity of modern industrial
institutions and charges that the profitable increment
in all capitalistic enterprise consists solely in the rob-
bery of labor, and as a logical consequence declares
that the only means of securing labor against this eco-
nomic plunder is the overthrow of the economic struc-
ture of society which permits of private ownership of
capital in productive industry.

While Marx's book is a formidable attempt to state
a complete body of economic doctrine scientifically
verifying the charge that the profits of modern industry
are robbery of labor, the foundation tenet in his whole
system, and without which his whole structure would
fall, is his theory of " surplus value." Take this away
and the whole Marxian system is but an empty railing
against society; leave this in, and, whatever defects his
reasoning may contain, his main charge that modern
industry rests upon robbery remains intact.

The peculiarity of Marx's critics — and their name is
legion — has been that they have attacked every part of
his system except this one, which is its foundation.
Under the title " Karl Marx and the Close of his Sys-
tem," Dr. Bohm-Bawerk has published a book of two
hundred and twenty-one pages, which the author evi-
dently thinks has demolished the whole Marxian doc-

*Karl Marx and the Close of his System. By Eugen v. Bdhm-
Bawerk. 221 pp. $1.60. The Macmillan Company, New York. 1898.

56

BOHM-BA WERK ON KARL MARX 57

trine. In view of Dr. Bb'hm-Bawerk's reputation the
title of the book creates high expectations, but a care-
ful reading of the entire volume dooms the reader to
one more disappointment. The book is written in the
author's best style, the criticisms are carefully elabo-
rated, and convey an evident intention to be fair. The
space is largely devoted to Marx's third volume, which
has not been translated into English. He shows very
clearly that Marx at times was loose in his reasoning
and inconsistent in his statements. He does this suc-
cessfully by pitting Marx against himself. All this is
very cleverly done, but the same thing is possible to a
considerable extent with almost any author. Bohm-
Bawerk's own works might without difficulty be sub-
jected to this process, as the Bible has been so many
times, yet without having any appreciable effect upon
its authority and influence.

Dr. Bohm-Bawerk has written a very interesting
review of Marx's book, but it cannot in any sense be
regarded as a refutation of the Marxian doctrine. The
objection to his criticism is that it attacks only the de-
tails of Marx's doctrine and leaves the vital part un-
touched. In the first chapter our author states Marx's
theory of surplus value, much of it in Marx's own
words, taking the literal illustrations Marx uses. If
there is any fundamental error in the Marxian theory it
is exactly at this place and in this chapter, because it is
here that Marx, by a process of statement and illustra-
tion, attempts to show how, by doubling the hours
without doubling the pay of the laborer, one hundred
per cent, of surplus value is created out of unpaid wages.

This is all cited by Dr. Bohm-Bawerk without the
slightest challenge. He takes it for granted, and then
devotes the remainder of his criticism to showing that
certain subsequent reasonings are not consistent with
this proposition. But all this is comparatively unim-

.58 GUN TON'S MAGAZINE [January,

portant. If Marx's main proposition is conceded,
whether he reasons correctly on all the details of his
doctrine or not is of little account. If his theory is true
that under the capitalist system the surplus value is
created by and only by "exploiting" the laborer, the
Marxian doctrine will stand; the socialist movement
will continue ; all criticisms will be essentially impotent
as long as this foundation proposition remains intact.

In following Marx, however, through a labyrinth
of subtle statements Dr. Bohm-Bawerk has revealed
many of his own errors. For instance, he quotes ap-
provingly Marx's admission that the average profit
enters into the "price of production" of commodities,
and the value. This is indeed inconsistent with Marx's
fundamental proposition, but it is an error. Marx was
wrong in this assumption.

Profits are surplus, not cost of production. As to
average profit, there is no such thing. There is in soci-
ety neither an average rate of profit nor a tendency
toward an average rate. Profits are the constantly vary-
ing increment of production, differing with almost every
individual enterprise. There is a tendency to uniform-
ity of price for the same thing in the same market, but
not to uniformity of profit, except in a purely static so-
ciety. It is this constant variation of profit which is
the direct result of constant variation in cost, per unit
of product, due to improved devices in machinery and
management, that constitutes the economic progress of
society, and so long as industrial progress continues
profits will be a constantly varying increment.

In making this admission Marx but fell into one of
the errors of the old school, from which our author is
evidently not entirely emancipated. It is not surpris-
ing that Marx should retain many of the errors of the
early English economists, as it was from their writings
that he studied the subject. The real question for the

1899-] BOHM-BA WERK ON KARL MARX 59

-critic of Marx to decide is not, has Marx retained some
of the old school errors, but is the doctrine that is pecu-
liar to his system defensible ? Much in Marx's doctrine
is old and much of the old is erroneous. The part
which is entirely new, and that which is the basis of all
the social propaganda for a social revolution, is the
proposition that "surplus value," or the profits of in-
dustry, are the robbery of labor. That proposition was
not in the old literature. That is the doctrine that is
peculiar to Marx. That is the theory that is being pro-
mulgated by the socialists who are demanding the over-
throw of established institutions and existing order of
society; and that is the doctrine that is still left un-
touched.

The kernel of error in Marx's theory comes from
the incorrect statement of the labor-cost principle, which
he took bodily from Ricardo, viz., that the value is de-
termined by and proportionate to the quantity of labor
•expended in the production. It was by strictly adhering
to this that Marx worked his trick of exploitation. The
real error Marx committed at this point was in following
Ricardo and confounding the quantity of labor with the
•cost of labor. If Marx had substituted in his original
theory the cost of labor for the quantity of labor he
would have been entirely right, but he would not have
been able to show that profits are exploitation of the
laborers. He could not have discovered that by doub-
ling the number of hours the laborer worked per day
he created a surplus value equal to the wages paid.
•Our author points out that ' ' The day's product of the
sculptor, of the cabinet maker or the violin maker or
the engineer, etc., does certainly not contain an equal
value, but a much higher value, than does the product
of the day laborer or a factory hand, although in both
the same amount of working time is embodied." Of
course not. This is one of the blunders that Marx was

60 GUNTON'S MAGAZINE

led into by the false assumption just referred to of
making labor time instead of labor cost the basis of value ;
but in pointing out this inconsistency Dr. B hm-Bawerk
does nothing really to impeach and offset that part of
the Marxian theory.

The work is an interesting criticism of Marx, and
makes many valuable points against the socialist proph-
et, but it is characterized by a wonderful amount of
cock-sureness which is not at all cock-sure. Many
propositions are taken for granted and reasoned upon
as if they were self-evident, which are old school errors
equal to any that enter the socialist theory. Marx's
theory of surplus value is a false theory. It rests upon
a trick of statement which has its foundation in an er-
roneous Ricardian postulate. On that trick of state-
ment, which contains a perfect somersault of reasoning,
Marx bases his entire theory; but that very trick of
statement and somersault of reasoning is passed over
and practically taken for granted in the book we are
now considering.*

Dr. Bohm-Bawerk has given us an interesting criti-
cism of Karl Marx's third volume, but he has not given
" The Close of his Svstem."

* For a complete analysis of this fundamental error in the Marxian
doctrine see Gunton's " Principles of Social Economics," p. 251. So far
as we know, his theory of " surplus value " has not been successfully
met anywhere else in economic literature.

ADDITIONAL REVIEWS

CHRISTIAN RATIONALISM. By J. H. Rylance,
D.D. Thomas Whittaker, Publisher, Bible House,
New York. 1896. 220 pp.

Strong in logic, modern in tone, and wholly admi-
rable in spirit. The author writes with the quiet reserve
power of one who has thought very earnestly and
deeply about the place and function of religion in a
world fast coming under the conscious control of scien-
tific knowledge. It may be said that in his conclusions
Dr. Rylance rises to a plane above that of the mere
controversialist, radical or conservative. Frankly con-
ceding that most of the theological concepts of the past
must give way before the new light of to-day, he still
maintains that creeds and institutions are no more than
the outward expression of a permanent religious ele-
ment in man, and therefore that no possible harm can
come by continual readjustment of theology to the in-
telligence and needs of successful eras of progress.
Writing from within the precincts of the orthodox
church his discussion of such topics as free thought,
reason and faith, and the like, is particularly fair,
courteous and reasonable, yet without the mere il mush
of concession." Pervading every page, indeed, even
though in the background, one is conscious of the
author's dignified and unshaken confidence in the per-
manence of the idea and forces which organized re-
ligious effort represents.

Such a book cannot fail to exert a good influence.
It is one of the signs of a movement whereof there are
many indications all about us to-day, that we are com-
ing up out of the controversialist era into larger things,
— out of speculation into accomplishment, out of mere
dissension and sparring into a harmonious coupling of
the forces of religion and science in large-minded,
creative work for the progress of humanity.

61

62 GUNTON'S MAGAZINE

MUNICIPAL REFORM IN THE UNITED STATES. By
Thomas C. Devlin. G. P. Putnam's Sons, N. Y. 174 pp.

The tone of this book is the more gratifying be-
cause it is very different from that which characterizes
much of the literature on this subject. Three-fourths
of everything that is written on municipal reform
is either overburdened with mere cynical criticism or
devoted to building up some impracticable theory of
non-partisanship. Mr. Devlin, judging from his book,
is neither a partisan nor a politician, but he recognizes
the necessity of organization in order to accomplish
anything in public affairs. Throughout his discussion
he lays the emphasis on the particular reforms that
ought to be introduced in municipal government, urg-
ing the necessity of a public opinion strong enough to
carry through these measures and see that they are en-
forced. Speaking of the function of reform societies or
movements, the author takes almost exactly the posi-
tion that has often been advanced in these pages:

" The local reform societies which will hasten the
desired reforms in the government of cities will be
those which can lay aside the bickerings and strife of
local politics; which can discard the old idea that re-
form necessitates complete destruction of that which is;
which can recognize good in many present officials,
whose personality is proof against the bitter accusations
of ignorant gossipers or defeated politicians and whose
co-operation would materially advance the best interests
of cities; and which link themselves with larger orders
and profit from the thought of the most advanced
students of the subject."

On the matter of expenditures for municipal im-
provements, salaries for capable officials, elections, civil
service, etc., Mr. Devlin is also in line with sound
principles of political science. His book is a whole-
some contribution to the literature of civic progress.

AMONG THE MAGAZINES

In the December Review of Reviews, Dr. Albert
Shaw, writing about the late Col. George E. Waring, says:
' ' His conduct of the department was al-
Wasteful ways £rom the standpoint of the Board of

Health rather than from that of the fiscal
authorities. He saw clearly that the city can never
afford to spend money grudgingly when the result of
such expenditure is shown in a decided reduction in the
rate of sickness and death." On this point Col. Waring
was fundamentally right. It is a poor economy that
sacrifices either human life or civilization to a low tax
rate. The utter failure of the street cleaning depart-
ment in New York during the recent snow-storm is a
sample of how this latter idea of " good husbandry"
works. For a whole week the streets of the second
city in the world were in a condition that would have
been disgraceful in any western boom town.

Littelfs Living Age quotes an article from the Speaker
(London) on " Tolstoy's Plan of Redemption." There
Tolstoy's is a peculiar fitness in the description

Plan of applied to Tolstoy in this article, as the

Redemption most pathetic figure in Europe. One
indeed reads his wild and utterly unfeasible scheme for
the abolition of nations and patriotism not so much with
a sense of indignation, or even of amusement, as of
regret at the manifest and pathetic decline in the mental
attributes and grasp of the man who only a few years-
ago made a world-wide and deserved reputatiori in the
field of literature. Tolstoy's plan of putting an end to
war by having the peasants and artisans in all nations
simply refuse to be drafted into the service, thus leav-
ing governments without support, is well referred to by
the commentator in the Speaker as something that could

63

64 GUNTON'S MAGAZINE [January,

only be conceived in a "most childlike mind." It is
the idea of ' * whole races acting like a few visionaries
in defiance of fundamental instinct." The doctrine of
non-resistance practically applied would simply mean
progressive overthrow of all the higher and finer things
that have been developed in the progress of civilization,
by the lower, coarser and more brutal elements below.
Maintenance of higher standards involves, and always
will, a certain amount of conflict with the lower, or so
long as the lower itself is not raised to the higher level.
As the article in the Speaker says: "War is horrible,
many wars are unjust, and patriotism is often foolish;
but this is only to say that human nature is very imper-
fect. It cannot be reconstructed on a wild plan which
leaves out all the elements that have played the strong-
est part in the human evolution."

In the Charities Review for December Mr. John H.
Patterson, President of the National Cash Register

Company, describes in detail the im-
SelfifhnessC proved conditions and opportunities for

employees that have for some time been
established in his factories at Dayton, Ohio. We have
personally visited the Dayton establishment and Mr.
Patterson's description in this article does not exagger-
ate in any way the very excellent, humane and enlight-
ened policy that has been followed. This applies not
only to the attractiveness and sanitary conditions of the
factories themselves, but to hours of labor, literary and
social facilities, mutual aid societies, etc. In summing
up his article Mr. Patterson says:

"The results are found in the increased intelligence and higher
character of the employees; the happy home life which is evident
everywhere in the building and in the community; the freedom of
thought and action, and the higher class of citizenship which is seen in
the entire community. On the part of the company there is the
highest satisfaction with the result of its efforts. The cost of produc-

1899.] AMONG THE MAGAZINES 65

tion has been gradually reduced and the character of the workman-
ship constantly improved. The company believes that its experiment
has paid, and its officers are satisfied not only to continue the methods
begun, but to have constantly in view additional changes that may
prove helpful. Because its principles are such as may be applied in
every home and every business with co-operation and mutual interest,
because it pays the investor, the policy here outlined will endure for
the years of the future."

Although Mr. Patterson says that this policy pays
him financially, we fear that it requires a greater de-
gree of public spirit and goodwill than can be perma-
nently relied on as an incentive for all other employers
to go and do likewise. It is possible, however, to
create a public sentiment that shall demand the gradual
establishment throughout the community of improved
conditions, at least in regard to sanitation and hours of
labor. This would relieve any particular employer
from the competitive disadvantage imposed by expen-
sive improvements or concessions which might not be
as feasible in all cases as Mr. Patterson found them at
Dayton. This does not in any way detract from the in-
dividual merit of the Dayton experiment; in fact, it is
one of the best possible influences tending to create a
public opinion favorable to rational and progressive
labor legislation.

INSTITUTE WORK

CLASS LECTURE
FREE TRADE AND PROTECTION IN PRACTICE

Few subjects have been discussed more during the
nineteenth century than the relative merits of free
trade and protection, yet few subjects are less clearly
understood. It is generally assumed, and very often
asserted by those opposed to protection, that free trade
is the natural policy ordinarily pursued by communities,
and that protection is a kind of arbitrary afterthought,
born of local selfishness and altogether abnormal.

This is not at all in accordance with the history of
industrial society. Historically, protection is the oldest
element in government. Government itself came into
existence to fill the need of protection. Nomadism
needs no government, because the nomad has practically
nothing to protect. With the advent of economic indus-
try, where present effort is expended for future product,
security became necessary. Every social institution
evolved for the enforcement of order, rights of life and
property, integrity of contract, security of the household,
right of religious opinion, and the right to select one's
business and own the product of one's labor, is an appli-
cation of the principle of protection.

In the whole evolution of societary institutions the
application of this principle has always been necessary,
presumably, at least, to protect the new and superior
against the old and inferior; to protect morality against
immorality, intelligence and freedom against ignorance,
barbarism and despotism. So with industry; with the
very earliest evolution of manufacture and commerce
came the practice of protection; first to protect the
goods of producers against marauding highwayry, and

66

FREE TRADE AND PROTECTION IN PR A CTICE 67

next to prevent the people of one community from
making invasion upon the trade of other communities.
So that, historically protection is one of the first princi-
ples of industrial and political society.

People generally do things first and then learn to
understand why they do them. So that, while protec-
tion is an inseparable principle of complex society, the
economic philosophy of protection is quite modern.
Not more so, however, than the philosophy of the
evolution of political and ethical institutions.

The strong does not need protecting against the
weak, but the function of civilization is to guard the
week against oppressive contact with the strong. The
superior is not always the strongest. It is the strongest
at the point at which it is superior, but its very
superiority in one line is likely to make it weak or in-
ferior in another. For instance, a highly cultivated
citizen is very much superior to "Sharkey" or " Fitz-
simmons," but in the matter of personal self-defense,
where the use of muscle is required, he would prove to
be inferior. The reason for this is that his very
superiority as an educated, cultivated person has led to
the disuse of biceps as a means of personal protection.
He is a part of a highly complex society, and as he be-
comes more social and ethical in character, the function
of personal protection is relegated to society, through
its police organization , so that personally he is less fit
to defend himself than was his predecessor in the time
of Moses.

But it is a part of the process of civilization that in
proportion as the higher faculties develop and the lower
faculties go into disuse, the intellect devises social
means to take their place. It is for this reason that
armies, navies, police organizations, courts of justice,
and the whole judiciary institutions of society have
come into existence. It may, therefore, be taken as a

68 GUNTON'S MAGAZINE [January,

general rule throughout society that the higher the
civilization the less the individual capacity to compete
with or defend one's self against the lower civilization;
that protection of the higher against the lower is neces-
sarily a collective, societary function.

In the application of tariffs to industrial competi-
tion between nations this principle obtains as complete-
ly as in the protection to persons. No tariff is neces-
sary to protect lower and inferior methods of pro-
duction against higher and more advanced methods; but
it constantly occurs that the more advanced methods
may need protection against the lower, or less ad-
vanced, for the very reason that the competitive power
of the lower or less advanced is made irresistible by
its use of an element in production which higher civ-
ilization, solely because it is higher, cannot obtain.

That element is cheap labor. The higher civilization
makes possession of this productive element inaccessi-
ble, while in the lower civilization it is abundant. In
such cases, individual producers in the higher civiliza-
tion have lost the capacity to compete with those in the
lower, not because of any inferiority in themselves, but
because the higher civilization in which they live ren-
ders that cheap labor element unprocurable. Protec-
tion against this lower quality, therefore, cannot be
furnished by the individual producer, and hence should
and must be furnished by the collective action of so-
ciety through a protective tariff.

Without having any very intelligible philosophy
on this point, this is what communities and nations
have always done. England, which is now cited as the
greatest free trade country in the world, having abol-
ished protective tariffs on imports, though it still re-
tains many other forms of protection, for centuries
maintained a most vigorous application of the protec-
tive principle. During the early history of her factory

1899.] FREE TRADE AND PROTECTION IN PR A CTICE 69

system England's protective duties were practically
prohibitive. She wanted to supply her people with the
manufactured products from her own looms and spin-
dles. Through the rapid development of invention and
perfection of machinery, however, by the middle of the
century England was able by her machine methods to
produce most kinds of manufactured commodities
cheaper than continental countries, notwithstanding her
higher wages. When she had reached the stage that
the i economies resulting from improved machinery
more than offset the greater cost due to higher wages,
and enabled her to produce at from ten to twenty per
cent, less cost than continental countries, political pro-
tection in the form of tariffs became unnecessary.

To enter foreign markets, and not keep foreigners
out of her own market, was now her policy, from the
point of view of national expansion. This led, very
naturally, to the repeal of tariff duties which had ceased
to be protective. In order to further aid in this direc-
tion, she removed the duties from food stuffs, that
laborers might live as well on less money and hence
work for lower wages without being poorer, and thus
further enable English producers to compete in foreign
markets.

In the United States the whole process of applying
the protective principle to industry has been different,
and solely because the social basis of our national life was
on a different plane. The United States was a trans-
plant from the cream of English civilization, which
gave a much higher social standard and consuming
power per capita than in England or any other country.
But like England, for the development of a rounded-
out national life, we needed manufactures. We needed
manufactures because the social needs of our people
required manufactured products for consumption, and
also because the diversification of occupation among

70 GUNTON'S MAGAZINE [January,

our people required manufacturing industries. We had
the market for manufactured products, and we needed
the manufacturing industries.

The only way we could expand and diversify our
manufacturing industries was, not like England by pro-
curing foreign markets, but in securing our home
market. Herein our very strength in civilization (high
social status) was our weakness in point of competition.
We could not procure the cheap labor of which England
had an abundance, because of our high standard of
living. Consequently the inability of the individual
producers in the United States to protect themselves
against the competition of Europe had to be superseded
by a social action through application of a protective
tariff. The effect of tariff protection in this country
was in many respects similar to the machine protection
acquired by England, which previously had needed
tariff protection. It secured the American market for
American producers. It practically said to the world,
all who compete in the American market must pay the
equivalent of American wages. If they do not pay it
in wages at home, they must pay it in tariffs on coming
here, thus putting the American producers on an equal
competitive footing in our own market with the pro-
ducers of other countries. This furnished assurance to
the capitalistic instinct, and factories could with safety
be erected and large capital invested in improved ma-
chinery to manufacture for an assured market at home,
which was the best in the world. The consequence,
was that when this security was obtained, capital and
science were applied to production and superior methods
were rapidly evolved, so that instead of the products in.
this country being very much dearer, by virtue of the
high wages here and the duty on imported goods, they
have been steadily reduced, by the use of improved
machinery, until in many lines of industry, despite

i899.] FREE TRADE AND PROTECTION IN PRACTICE 71

our higher wages, products are cheaper here than
abroad.

This is one of the practical effects of protection. It
is true in every line of social growth that the first stages
of protection are an added expense, but it is also true
that the thing protected more than compensates for the
cost of its protection, ultimately making protection less
expensive than non-protection. In other words, it
makes civilization cheaper than barbarism. The pro-
tection of intelligence and morality leads to the elimi-
nation of crime and disorder, and encourages altruism
and intellectual activities which, expressed in science
and art, give society many times more in value in a
hundred ways than protecting it costs. It is on the
principle that schools are cheaper than jails and poor
houses. With the protection of industries, when ap-
plied on this principle, the result is the same. The
protection of the higher social group from the drag-
down influence of the lower secures the opportunity for
applying intellect and science, which ultimately fur-
nishes the same things cheaper than barbarism can pro-
duce them.

What has been said of protection in regard to the
importation of goods is true in regard to the immigration
of laborers. Laborers in advanced countries should be
protected against the industrial competition and social
innovations of laborers from lower wage countries.
The capitalists of every country are justified in seeking
protection against competition with lower wage coun-
tries, either by development of superior machinery or
political intervention through tariffs, but should never
be permitted to protect themselves in competition by
having recourse to the introduction of socially lower
(cheaper) laborers from other countries.

There is one mistake very generally made in discuss-
ing this subject, which it is important for students to

?2 GUNTON'S MAGAZINE

avoid. It has become habitual for both the advocates of
protection and the advocates of free trade to assume that
because tariff protection encourages industry under some
circumstances it will necessarily do so under all circum-
stances; that because it has worked well in America it
could be applied with the same beneficial results to all
other countries. The free trade advocate, with even more
assurance, asserts that because the abolition of duties
on imports worked well for England, it can be adopted
everywhere with equally good results. Both these pro-
positions are unscientific, unphilosophical and essen-
tially false. Protection can only be beneficial to any
group or nation when the collective intervention of so-
ciety is needed to protect industries against innovation
of lower social types and the products of lower wage
conditions. Protection is not needed to prevent con-
tact or competition with higher types, either of social
life or industrial methods. In reality, the scientific ap-
plication of the principle of protection to industry for
every country is to make the wages of its own country
the basis of all competition in its own market. The
products of all countries whose wage costs are lower
than its own should be subject to a duty at least equal
to the difference in the labor cost, so that products
from other countries could never enter that market
without paying the equivalent of the labor cost of its
own country. If this principle, which is abundantly
illustrated in the history of every country, is clearly
comprehended as a basis of industrial intercourse be-
tween social groups or nations, the issue between pro-
tection and free trade would cease to be a subject of
confusing controversy, and become a simple question of
practical statesmanship.

WORK FOR JANUARY

OUTLINE OF STUDY

The curriculum topic " Foreign Policy" is divided
into three sub-heads, — Territorial Policy, Protection,
and Free Trade. The first of these was covered in our
work last month. The remaining two form the subject
of study for January, as follows:
b Protection.

1 The protective principle in society.

2 Theory and history of tariff protection.

3 Practical effect of protection.

4 Export bounties.

5 Restriction of immigration.
c Free Trade.

1 History of free trade.

2 Theory of free trade.

3 Practical effect of free trade.

4 The reverse interest of P^hgland and the United States.

REQUIRED READING

In " Principles of Social Economics," Chapter III
of Part IV. In GUNTON'S MAGAZINE for January, the
class lecture on * * Free Trade and Protection in Prac-
tice," also, the Notes on Required and Suggested Read-
ings. In GUNTON'S MAGAZINE for November, article
on "England's Future Policy." In GUNTON INSTI-
TUTE BULLETIN No. 14, lecture on "The Open Door in
the Philippines."

SUGGESTED READING*

In Taussig's "Tariff History of the United States,"
Chapter I under title Protection to Young Industries as ap-
plied in the United States, and Chapters I to V inclusive

* See Notes on Suggested Reading, for statement of what these
references cover. Books here suggested may be obtained of publish-
ers as follows, if not available in local or traveling libraries :

The Tariff History of the United States, by F. W. Taussig,
LL.B., Ph.D. : G. P. Putnam's Sons, New York. 344pp. $1.25. In-
dustrial Evolution of the United States, by Hon. Carroll D. Wright:
Flood & Vincent, Meadville, Pa. 362 pp. $1.00. National System of

73

74 GUNTON'S MAGAZINE [January,

under title The History of the Existing Tariff — 1860-
1890. In Carroll D. Wright's " Industrial Evolution of
the United States," Part II. In List's ''National System
of Political Economy," Chapters VII, VIII, XVI and
XVII, of Book II. In Denslow's * 'Principles of Economic
Philosophy, "Chapters XIV and XV. In Wood's ' 'Political
Economy of Natural Law, " Chapter XIX. In Trumbull's
"Free Trade Struggle in England," Chapter IX, to end
of the book. In Bastable's "Theory of International
Trade," Chapters VIII and IX. Also, the whole of Sum-
ner's "Protection in the United States," (64 pp.) In
Bastiat's " Sophisms of Protection," Chapters XII and
XX of Part I. Curtiss's "Protection and Prosperity" is
a voluminous collection of historical and statistical data
on the subject of tariff protection throughout the civil-
ized world, particularly in England since the early mid-
dle ages, and including the experience of the United
States. No particular chapters are suggested, but the
book would be useful for general reference purposes.

Students might well re-read in connection with this
month's work the class lecture on ' ' Theory of National
Development, "in the October Magazine.
NOTES AND SUGGESTIONS

Re quired Reading. Thus far this season we have been
considering general principles, chiefly. Last month, in

Political Economy, by Frederick List. (Translated from the German.)
Out of print. May perhaps be found in local libraries. Principles of
Economic Philosophy, by Van Buren Denslow, LL.D. Cassell & Co.,
New York. 782 pp. $3. 50. The Political Economy of Natural Law,
by Henry Wood. Lee & Shepard, Boston. 305 pp. $1.25. The Free
Trade Struggle in England, by M. M. Trumbull. Open Court Pub-
lishing Company, Chicago. 288 pp. 75 cts. The Theory of Interna-
tional Trade, by C. F. Bastable, M. A., LL.D. The Macmillan Co.,
New York. 184 pp. $1.25. Protection in the United States, by W.
G. Sumner. G. P. Putnam's Sons, New York. 64 pp. 75 cts. Soph-
isms of Protection, by M. Frederic Bastiat. G. P. Putnam's Sons,
New York. 398 pp. $1.00. Protection and Prosperity, by George B.
Curtiss. Quarto, 864 pp. May perhaps be found in local libraries,

1899.] WORK FOR JANUARY 75

taking up the question of territorial expansion, we be-
gan the study of the concrete problems of government,
and in our January work we reach topics of even more
direct practical interest, — protection and free trade. It
is unfortunate that the issue between these two radi-
cally hostile policies has heretofore been so interwoven
with party politics as to keep the discussion on a rel-
atively mediocre plane instead of on the high level of
unprejudiced philosophical investigation. It is even
more unfortunate that only the free trade side of the
question has been presented from the standpoint of a
general scientific principle, the protectionists making
very little attempt to urge their doctrine as anything
broader than a practical expedient for gaining certain
material advantages. The GUNTON INSTITUTE believes,
on the other hand, in the theoretical soundness of tariff
protection, under certain conditions, as a part of a gen-
eral and absolutely essential protective principle running
through all society. This principle, briefly stated, re-
quires protection of higher against lower standards of
social life and civilization, as an indispensable condition
of progress. Tariffs are only one phase of the many
lines of policy that may be necessary in application of
this principle, and they are only necessary in the case
of nations having more advanced social standards than
exist in other and competing countries.

It is from this broad standpoint of general principle
that the question of international trade is discussed in
the chapter assigned in " Principles of Social Economics."
It is in proving the social, rather than merely material,
importance of manufacturing industries and of high
wages that Professor Gunton really establishes, probably
for the first time, a scientific basis for tariff protection
of higher against lower industrial civilizations. He
shows in what ways a tariff policy may actually stimulate
the forces that make for higher wages, points out the

76 GUNTON'S MAGAZINE [January,.

principle that should govern in the laying of customs-
duties, and discusses the effect of tariffs on prices,
profits, and industrial development. This chapter is-
one of very great importance and should be carefully
studied and freely debated in local center meetings.
Any questions bearing upon it, if sent to Professor
Gunton, will receive prompt attention.

In the magazine article on " England's Future
Policy," it is shown how, strictly in harmony with the
protective principle, England was able to dispense with
tariff duties fifty years ago and how she is now again
approaching a period in which restoration of that
policy will be necessary.

In the Bulletin lecture on ''The 'Open Door' in the
Philippines," Professor Gunton points out that since the
protective principle only requires guarding of the higher
against the lower, no tariff system is needed in the
Philippines, but that for some time to come they would
benefit most by actual free trade. This is an exceptionally
important lecture, because it brings out more clearly
than ever the fact that the protective principle is univer-
sal in society, even though its application may under-
varying circumstances call for directly opposite policies.

Suggested Reading. Professor Taussig, in the first
chapter suggested in his book, discusses the " infant
industry " argument in its relation to the early protec-
tive policy in this country. In the other chapters he
traces the history and to some extent the effects of tariff
legislation from the Morrill " war tariff " of 1861 to the
McKinley law of 1 890.

The reading suggested in Col. Wright's " Indus-
trial Evolution of the United States " shows the develop-
ment of American industries, the course of wages and
employment, etc., in two great periods; the first, from
1790 to 1860, and the second from 1860 to 1890. The
statistical information here given will be found, in:

.i899.] WORK FOR JANUARY 77

many respects, quite closely related to the tariff history
traced in. Prof. Taussig's book.

Frederick List, a German economist, born in 1789,
was practically the first conspicuous writer on the sub-
ject to oppose the free trade doctrine of the English
School. He developed a theory of protection, not in-
deed complete or fully embodying its basic principles,
but in the main philosophically sound. A great part
of his argument is extremely able, particularly in the
•chapters we have suggested, showing the relation of
manufacturing industry to personal, social and political
development, and the effects of tariff duties in stimu-
lating the growth of manufactures. The details of
some of his propositions on this latter point are not in
line with sound public policy, especially from the
standpoint of to-day; this, perhaps, is not surprising.
But List's title to distinction rests upon the fact that in
a period when practically all the accepted economic
doctrine of Europe centered around free trade, he stood
out and developed an opposing theory which was in its
root ideas sound.

One of the chapters suggested in Denslow's " Prin-
ciples of Economic Philosophy " takes up a series of
familiar arguments in the writings of English-school
economists on free trade, and presents the contrary view
from the standpoint both of theory and experience.
The other chapter suggested deals with the technicali-
ties of protective tariff policy as applied in the United
States, and its various effects.

Chapter XIX in Wood's "Political Economy of
Natural Law " is suggested chiefly because it gives the
view of a writer whose standpoint with regard to most
public policies is that of the extreme Spencerian « ' no-
government-interference " idea. Nevertheless, he
mildly approves some degree of tariff protection as a
means of sustaining higher wage levels, and his eco-

78 GUN TON'S MAGAZINE [January,

nomic reasoning here is if anything superior to that of
most avowedly protectionist writers. That he takes a
very narrow view of the whole subject, however, is
clear from his remark that protection ' * lacks the basis
of a universal principle. The question of an American
tariff is only a question of American expediency." As
we have before pointed out, it is highly superficial
reasoning which says that a principle is not universal
unless it calls for the same policy under all conditions
and circumstances. If this test holds, then there is no
universal principle anywhere in nature.

The. last ten chapters (149 pages) in Trumbull's
" Free Trade Struggle in England " gives the history
of the Anti-Corn Law movement in England during
the few years just preceding its final triumph in 1 846.
It is written strictly from a free trade standpoint.

The first chapter suggested in Bastable's " Theory
of International Trade " presents and supports the free
trade theory, and the second attacks several of the
standing protectionist claims. In the latter chapter
the purely materialistic nature of the economic reason-
ing for free trade is most marked. The socially civiliz-
ing effects of diversified industries, considered as out-
weighing many times the economic loss which a tariff
may temporarily cause, is entirely ignored. It is as
though, to use an extreme illustration, some mathema-
tician should set about to prove by elaborate computa-
tions the admitted fact that public schools and police
systems cost money , and then urge that these institutions
therefore involve economic waste and vicious paternal-
ism, and should be abolished!

Professor Sumner, of Yale, is one of the conspicu-
ous American exponents of free trade. His little book,
above suggested, contains five lectures delivered in
New York in 1876, dealing with the tariff problem in
its relation to American conditions.

i899.J WORK FOR JANUARY 79

Bastiat's ' 'Sophisms of Protection" is a standard
free trade work, written in a popular and easy style but
largely based on certain of the classic economic dogmas
of a half century ago which advanced scientific discussion
has discarded. This is particularly true of his reasoning
in Chapter XII, where he discusses wages as governed
by supply and demand. In Chapter XX he makes the
protectionist theory stand for an idea which is in reality
wholly foreign to it, i. e., that tariffs are intended to
protect human labor against machine power of superior
efficiency. This is incorrect. The real purpose of a
tariff policy in its earliest stages is to develop instead of
prevent machine methods of production, in the place of
hand labor, and when the machine methods of any two
or more competing countries have become practically
equal a tariff should only protect the higher labor cost
which may exist in any of these countries as compared
with the others. Such a tariff then operates to protect,
not inferior methods of production, but superior social
standards.

LOCAL CENTER WORK

For debates in study club meetings this month we
would suggest: Resolved, That under certain condi-
tions protective tariffs are a necessary application of the
protective principle in society. Resolved, That the
social advantages of diversified artistic industries justify
the temporary cost of tariff taxation. Resolved, That
tariff taxation is an unjust burden on the consumer.
Resolved, That the free trade theory is morally superior
to the protective.

Papers on: Why England adopted free trade:
Sketch of American tariffs: How a protective tariff
may stimulate wages: How a protective tariff may
preserve higher wage standards: Is free trade in the
Philippines inconsistent with the protective principle?:

'ommittce of Selection :
THOMAS B. RHHD.
EDWARD HVHRETT HALE.
AINSWORIH R. SPOFFORD.
WILLIAM R. HARPER.
HOSSITER JOHNSON.

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GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

PROSPERITY AND SOCIAL EDUCATION

It is a fact as old as history and as universal as the
human race that social ideas arise directly or indirectly
out of the economic conditions of the people. Every
change in social and political institutions is the result
of a demand for better adjustment of the social machin-
ery to the needs of the people. It is for this reason
that prosperity creates optimism and adversity pessim-
ism. So long as prosperity continues, there is little
real danger of social disruption. It is when a period of
industrial depression arrives, with its train of social
disorders, that the social reaction sets in, with new
theories, suspicion of traditional leadership, and distrust
of existing institutions, sometimes resulting in revolu-
tions. That is what Lord Macaulay had in mind when,
in 1835, speaking of American institutions, he said:—

1 'Your fate I believe to be settled, though it is de-
ferred by a physical cause. As long as you have a
boundless extent of fertile and unoccupied land, your
laboring population will be far more at ease than the
laboring population of the old world, and, while that is
the case, the Jefferson politics may continue to exist
without causing any fatal calamity. But the time will
come when New England will be as thickly populated
as old England. Wages will be as low and will fluctu-
ate as much with you as with us. You will have your
Manchesters and Birminghams, and in these Manches-
ters and Birminghams hundreds of thousands of arti-
sans will assuredly be sometimes out of work. Then,
your institutions will be fairly brought to the test.

81

82 GUNTON'S MAGAZINE [February,

Distress everywhere makes the laborer mutinous and
discontented, and inclines him to listen with eagerness
to agitators who tell him that it is a monstrous iniquity
that one man should have a million while another can-
not get a full meal. . . . Through such seasons the
United States will have to pass in the course of the
next century, if not of this. How will you pass through
them? I heartily wish you a good deliverance. But
my reason and my wishes are at war, and I cannot help
foreboding the worst."

Under representative governments this is univer-
sally true. The character of the ideas and reforms
which come to the front in a period of adversity depends
very largely upon the character and extent of social ed-
ucation during the periods of prosperity. It is always
easier to lead ill-informed, indignant crowds in the di-
rection of disintegration and revolution than in the di-
rection of intelligent, constructive improvement, because
only feeling and passion are necessary for the former,
but intelligence, foresight and knowledge are necessary
for the latter. That is why so many of the peasant up-
risings in Europe have come in what have been called
"bad years," when crops failed and hard times prevailed.

The United States has recently passed through a
period of industrial depression and business catastrophe
which lasted long enough to permeate the condition of
every class in the community. This period of depres-
sion was exceptionally fertile in bringing to the surface
social ideas, particularly among the laboring population.
Social ideas or theories developed in this way are uni-
formly hostile to the industrial institutions and political
leadership under which the business depression exists,
that gives them birth. This is entirely, natural. Every
section of the country had its group of social ideas,
which, while they differed in detail, were essentially
the same in spirit and principle.

I899-] PROSPERITY AND SOCIAL EDUCATION 83

Thus, for instance, in the West and the South the
form of hardship which the industrial depression as-
sumed was financial. The economic and social ideas,
therefore, assumed a financial form, and as all the tradi-
tional methods of the country had been in the line of
individual effort and private ownership and direction of
industrial enterprise, in banking as well as in mining,
farming and other industries, the reform ideas in the
South and West were all in favor of government action
in financial matters. This finally expressed itself in a.
political movement in favor of the free coinage of silver,,
as a governmental or essentially socialistic means of
making money cheap, the price of farm products high,
and the farming population prosperous. In proportion
as these ideas were opposed by the capitalist, or more
successful, class were they more tenaciously adhered to
by those who believed them to be the means of remedy-
ing the industrial evils and bringing back prosperity.

In the eastern states the pressure of the hard times
was most severely felt by the wage-earners, through
enforced idleness and reductions in wages. They were
not borrowers of money and payers of interest, and con-
sequently did not feel the hardship from the financial
side of the situation; but they were wage-workers, and
felt the pressure of the hard times in smaller incomes or
enforced idleness. Hence to them the problem was
slightly different; but, acting on their feelings rather
than intelligent opinion, they too saw the cause of their
misfortunes in the fact that the employing class owned
the means of production. Like their comrades in the
West, they took on, as is always the case, the attitude
of distrust and suspicion, and finally believed that they
were being robbed. Hence they readily listened to
the explanation of their woes, that the productive
wealth of the community was privately owned by the
employing class. They were easily made to sympathize

84 GUN TON'S MAGAZINE [February,

with the idea, and ultimately believe, that the real
remedy for their depressed condition is some change in
the industrial structure of society which shall put the
wealth and means of production in the hands of the
community of which they are a part, and thus insure
them not only their share, but constant power to control
and appropriate whatever wealth is produced.

All this more or less definite formation of social
ideas and efforts at social reform was of a socialistic ten-
dency. The period of depression lasted a sufficient
length of time to give this social disappointment, dis-
trust and semi-sourness an opportunity to grow and
weld into at least a tentative public opinion, which ex-
pressed itself politically in the election of 1896 by cast-
ing over six million votes for a semi-socialist national
policy. Although this group of social ideas, produced
by four years of industrial disaster, did not culminate
in a definite political policy, it has left its impression
on public opinion in nearly all lines of economic, politi-
cal and civic thinking. That period of disaster was an
object lesson in two definite directions; (i) it demon-
strated beyond all doubt that a free trade policy in this
country, for the present at least, is disastrous to our
industrial prosperity; (2) it demonstrated that under
democratic institutions long periods of industrial de-
pression are dangerous to political stability and social
freedom.

The change of policy which was so imperative is
teaching another object lesson, viz: that with an intel-
ligently applied protective policy we have the condi-
tions of great industrial prosperity, and second, that
with prosperity, disintegrating, revolutionary social
ideas have much less chance to grow. We have had
one year of greatly improved business conditions; we
are now entering upon another which promises to be
still more prosperous, and the effect of the business

I899-] PROSPERITY AND SOCIAL EDUCATION 85

prosperity upon social ideas is already clearly notice-
able. For instance, in the western states prosperity has
been even more marked than in the East. The price
of wheat went up, — which at one stroke took prosperity
to the farmers. In the mining states industry has been
directed to the digging of gold instead of silver, and the
return of general prosperity has created a profitable de-
mand for other mining products, so that even from Col-
orado the news comes that .prosperity is again at the
high water mark. The increase of profitable produc-
tion in gold mining has far outweighed the decline in
silver mining.

The effect of this upon the minds of the people is
such that the demand for free silver, for which they
were willing to overturn the entire financial and busi-
ness conditions of the nation, has almost passed away,
become quite dormant. So much so that there is no
practical public interest in it that is likely in the near
future to result in a political expression. It is conceded
in the most rabid silver states that free silver will not
make an attractive issue for 1900. Populism, a phase
of the same social thinking, has also passed into a com-
paratively quiescent state with the return of prosperity.
This does not mean, however, that the people have
been intellectually convinced of the error of their
thinking, but only that their ideas were more the
result of feeling than of thinking. They have simply
become more quiescent as the return of prosperity has
relieved the social hardships that were so marked and
depressing from 1893 to 1897.

This experience ought to contain an important
lesson for the leaders of public opinion and public
policy in this country. The idea frequently expressed
by the superficial politician, that the return of pros-
perity solves and settles these social heresies, is a woful
mistake. It is scarcely less dangerous to society than

86 GUNTON'S MAGAZINE [February,

the disintegrating ideas themselves, because it tends to
close the eyes of public men to the true situation.
Industrial depression will create disrupting social ideas
and social policies, and the mere return of prosperity
does not abolish these ideas. At best it only lulls them
into quiet, perhaps to slumber till the next industrial
depression arrives, only to break out afresh with
increasing force and perhaps revolutionary effect.

In order really to save the country from the social
dangers of the period of depression we have just passed
through, two important lines of public activity must be
undertaken, — one by statesmen, and the other by the
educators of the nation. It should from now on become
the pronounced and unwavering purpose of state and
national legislators to inaugurate a policy of genuine,
rational improvement in the laborers' side of our indus-
trial life. Everything should be done which can be,
through legislation and public sentiment, to better the
conditions under which people work, protect them
against all forms of depressing innovation, and throw
the influence of state and municipal authority around
them in their wage conditions, workshop influences,
home environment and educational possibilities for
their children. In short, the period of prosperity
upon which we are now entering should be utilized
as a special opportunity to apply statecraft and the forces
of civilization directly and specifically to all the oppor-
tunities and influences which make for bettering the
economic condition and social life of the masses. This
would emphasize the prosperity, and tend directly to
sweeten the lives and stimulate the confidence of the
people in the beneficent influence of democratic institu-
tions and the genuineness of American statesmen and
leaders in public affairs.

On the other hand, in order that this prosperity and
statesmanship may have its proper effect, it is equally

1899-] PROSPERITY AND SOCIAL EDUCATION 87

important that the educators of the country contribute
to the result by a special, direct movement throughout
the country of industrial and political education. This
does not mean merely the multiplication of universities,
but it does mean multiplication of the opportunities for
rational discussion of industrial and social questions,
right among the great mass of the laboring classes
whose lives are directly affected by these questions and
whose ideas, thus developed, are going to direct the
character of public policy in the future.

The Spanish war, before we are finally through
with it, will probably cost a half a billion dollars. This
was expended in the effort to emancipate the people
of Cuba from the oppressive rule of Spanish despotism.
To all this nobody seriously objects. Neither those
who paid the taxes, nor the nations of the civilized
world which looked on, have raised a perceptible mur-
mur. It was done in the interest of civilization, and the
result, if it is accomplished, will be regarded as cheaply
obtained. But the significant point is this: — half of
that amount, expended in political and economic edu-
cation among the masses of our own American citizens,
would do twenty times as much for civilization, freedom,
progress, and the permanence of democratic institu-
tions, by elevating the social condition of the seventy-
five million of people in the United States.

The common school is the great democratic educa-
tional institution. It has been the saving factor in
our civilization. Institutions of higher education have
also grown apace, and been liberally supported by the
contributions and public spirit of the American people.
More recently, a marked addition to our educational
system is the kindergarten. We are reaching out for
the babes, scientizing their very play, and thus making
our educational system begin almost in the nursery.
All this is hopeful and inspiring, and shows that our

88 GUN TON'S MAGAZINE [February,

progress is not merely sordid materialism but that it is.
scarcely less educational than economic ; and this is in-
dispensable to the permanence of free institutions.

But there is one great and growingly important field
which our educational institutions have not adequate-
ly covered. The kindergarten and common school do a
grand work up to the time when the people leave for
the field and factory in pursuit of a living. With the
steady improvements in methods of teaching and sub-
jects of study, the education of American children
under fifteen may safely be trusted to our kindergartens,
and common schools. The college and university sys-
tem may be trusted adequately to furnish the higher
education to the small proportion who can avail them-
selves of it. But beyond the common school the great
mass of American citizens, who do the voting and upon
whose intelligence the solution of the great industrial,
social and political problems depends, have practically
no educational opportunity other than their experience
in the workshops, and newspaper literature. The com-
mon school does not as yet touch the problems with
which citizenship has to deal, and could do so only in
an elementary way; and the great mass of the laboring
people, out of whose lives and conditions these very
problems arise and in whose interest they must be
solved, do not reach the colleges.

For this our system of education makes no provis-
ion. We have developed free democratic institutions,
whose safety rests upon the political intelligence and
judgment of the masses; but have neglected to provide
the particular kind of education necessary for an intelli-
gent use of political power. The great laboring class,
constituting a vast majority of our citizens, have neither
time nor inclination to study an elaborate curriculum, in-
cluding the classics and higher branches of learning, but
what they need, desire, and as active citizens would

1899.] PROSPERITY AND SOCIAL EDUCATION 89

practically utilize, is a knowledge of the industrial,
civic and political problems which, are from year to year
rising to the plane of public questions for political
action in municipal, state and national affairs. This
group of subjects they do and will act upon, by virtue
of being citizens of a democratic republic. If no op-
portunity for systematic education in this field of knowl-
edge is offered, they will act, as they are acting, upon
the sense impressions created by personal contact with
the industrial conditions under which they live and
move and earn their living. That intelligence should
take the place of feeling and impulse in this sphere of
public activity is essential to the continued progress
and even safety of the Republic itself. Not only is
this the direction in which the next step in educational
evolution must be taken, but the step must be taken
now. Every year's delay is jeopardizing the symmetri-
cal development of our national life and civilization.

The work cannot with safety be neglected. In
every city of fifty thousand population and upwards, in
the United States, there should be established an organ-
ized movement for economic and political education.
Every city of considerable size, at least, should have a
permanent home for this work, with lecture rooms,
libraries, bureaus for judicious distribution of litera-
ture, and facilities for training teachers and students to
organize and conduct local clubs throughout the city
where the work should be going on. This work of pop-
ular industrial and political education should be as per-
manently established as the church and the common
school, and money contributed for it ought to be as eas-
ily obtained as contributions in the church collection
box. Every dollar expended in this way would be
more effective for good government, intelligent citizen-
ship, enlightened public opinion, and industrial and
political stability than any ten dollars expended in any

go GUNTON'S MAGAZINE

other direction. Nor ought there to be any difficulty in
procuring the requisite means for such a work. The
capitalists who are going to reap handsome profits from
industry during the next year might, and if properly
approached would, readily contribute to it. All that is
really needed is an earnest effort on the part of the
leaders of public opinion, in the press and in education-
al institutions, seriously to inaugurate this educational
system. If the capitalists of this country would, in the
next five years, contribute to this movement as liberally
as they contributed to the political funds to prevent a
catastrophe at the last presidential election, they would
probably postpone, and perhaps forever avoid, the disas-
ter which they came perilously near encountering in
1896.

The time has about gone by in this country when
election funds can be relied on to save the nation from
ignorant voting or the result of disintegrating and
disaster- creating social ideas. The more these ideas
are entertained and propagated, the deeper the convic-
tion becomes and the further are the laboring class,
who constitute the immense majority, removed from the
immediate influence of any mere use of money for
election purposes. If the country is to be saved from
the devastating influence of socialistic experiments, it
must be through wholesome, intelligent opinion among
the people and not by any method of coercion or
bribery by the employing class. Every millionaire in
the country ought, and doubtless would, if approached
by those in whom he had confidence, willingly contribute
to such a movement of democratic education. Probably
there is not a city in the country with a hundred
thousand population that would not erect a suitable
building for the conducting of such an effort for public
education. The year 1899 ought to see its practical
beginning in every large city in the United States.

IMPROVING OPINION ON THE PHILIPPINES

Public opinion regarding our relations with the
Philippines is undergoing a very wholesome modifica-
tion. The President's non-committal attitude has had
the effect of giving notice, as it were, that the disposi-
tion of the Philippines is an open question which can be
freely discussed within the Republican party as well as
without. Since this became plain, the discussion of the
question has been perceptibly more vigorous, more
American, and the tendency has been definitely in the
direction of a more philosophical and statesmanlike
disposition of the subject.

The opposition to the confirmation of the treaty has
also contributed to this result. While there are some
who, largely for mere party purposes, desire the defeat
of the treaty in the Senate, there is a strong patriotic
feeling throughout the country that, if a rational policy
is likely to be pursued, in the final treatment of the
Philippines, loyalty to the administration and the dignity
of the country require that the treaty be confirmed.
But if the administration and the Republican party and
Congress proceed upon the assumption that the Philip-
pines are to become a permanent part of the United
States — an imperial colony of a democratic republic — it
would be better that the treaty be defeated. The im-
pressionable attitude of the president, and the possibil-
ity that under certain circumstances rejection of the
treaty might have the endorsement of public opinion,
has manifestly had a greatly modifying effect upon the
whole tone of the discussion. Republicans of the stal-
wart type of Foraker are, while advocating confirmation
of the treaty, definitely taking the position that the
treatment of the Philippines should be, as far as feasi-
ble, like that to which we pledged ourselves before the
war in regard to Cuba, viz: that our control should be

91

92 GUNTON'S MAGAZINE [February,

temporary, and that in taking the Philippines under our
charge, which cannot very well be avoided under the
circumstances, our effort and object should be not to
make them permanently a part of the United States, but
to aid them in establishing the conditions which shall
make, in the shortest time practicable, self-government
possible.

This view seems to be rapidly gaining ground
throughout the country. Intelligent Democrats, as
well as Republicans, are acquiescing in and supporting
this as the proper attitude for this country to take. Of
course, this does not mean that we must not resist ag-
gression. It does not mean that in defending the
movement towards democracy in this western hemi-
sphere we may not have to follow the enemy into
Europe or Asia or Africa. It does mean, however, that,
except as accidentally called upon to pass over into
another part of the world in settling the rights of
American peoples for the opportunity of self-govern-
ment, our policy shall be to develop the conditions and
opportunities and influences for elevating and perfect-
ing democratic civilization in the Americas. In other
words, that it shall not be a part of the policy of this
republic ever affirmatively to intrude ourselves and
assume the responsibility of permanent political govern-
ment in either Europe, Asia or Africa; that our in-
fluence in those parts of the world shall be through
commercial intercourse and political friendliness, but
not by military or governmental authority.

Moreover, it is coming to be recognized by students
of political science and industrial evolution that, in order
to insure the development of a high type of national
civilization, there must be a large proportion of inten-
sive industry. All nations begin by being agricultural.
No considerable distinction and power can be acquired
by a nation until it passes into the next stage of indus-

1899-] IMPROVING OPINION ON THE PHILIPPINES 93

trial development, — manufacturing and commercial.
This secondary action of national growth, must be suffi-
cient to solidify the industrial sentiment of the country
by the inter-relation and dependence of the two types
-of industry, agriculture and manufacture. The United
States is now in just that stage. It has not yet quite
completed the solidarity of the nation. The last forty
years has been a period of unparalleled growth in the
second stage of nation building. Had we been half the
size, had the boundary line of our nation westward, for
instance, been the Mississippi, probably by this time we
would have reached that stage of symmetrical industrial
development; but we have another nation beyond. We
have spread out horizontally. What we now need, and
what we must have in order to secure a strongly devel-
oped nation, is growth upwards. A higher character
rather than greater numbers is our immediate necessity.
Any step in our national policy, therefore, which fur-
nishes an incentive, or even an opportunity, for the
United States further to spread itself horizontally, run
out into agriculture, mining and other ruralizing and
extractive industries, will take away the pressure and
incentive for the development of intensive industries
and the gradual solidifying of the national character,
which only local interdependence of industry can give.

Every addition to the United States of new terri-
tory with inferior population is an addition to the eco-
nomic crudities of our industries, and lessens the force
of the socializing and civilizing influences in the com-
munity.

Happily, this is beginning to be at least faintly
observed. The American people are beginning to
recognize that after all there is more to be done for
civilization, more opportunities to be secured by capital,
more welfare to be furnished to more millions of human
beings, by developing the possibilities of the United

94

G UN TON' S MA GA ZINE

States than in the acquisition of foreign territories
inhabited by barbarians.

From present indications, therefore, it looks as if a
thoroughly rational, patriotic and American attitude
would finally characterize the policy towards the
Philippines; that the treaty will be confirmed, but only
with a modification or distinct understanding that our
policy in the Pacific shall not be one of annexation or
permanent political authority. Our probable policy
will be to secure peace and order in the Philippines, and
arrive at a friendly understanding with the Filipinos-
that the country shall be theirs as soon as they indicate
their willingness and capacity to institute and maintain
a rational government which shall permit industrial
intercourse with other nations, and guarantee security
of persons and property, so that the influences of
industrial progress and modern civilization shall be
permitted freely to operate upon the condition and
character of the people.

If that is the policy we pursue, which is sub-
stantially the same as we have already announced for
Cuba, the influence of the United States upon modern
civilization will be many times greater than by the con-
quest of the islands, or even the purchase of them for
twenty millions from Spain and forcing them from the
Filipinos against their will. It would establish a new
departure in the policy of nations. It would at once
give the world warning that the United States is not to-
be trifled with, and establish the fact beyond question
that it stands for democracy, that it is a friend of
struggling freedom, and has no desires of conquest and
pillage in any part of the world. That would at once
make this nation feared by the quarrelsome and loved
by the peaceful of the human race. It would put the
United States, in statesmanship and humanity, as it al-
ready is in wealth, at the head of the world's civilization.

DISTINGUISHED ECONOMISTS
VIII — FRANCIS A. WALKER

Francis A. Walker marks the beginning of liberal
economics in the United States. He occupies a pecu-
liar and in some respects distinguished position in the
evolution of economic doctrines in this country. In
1876 he published his first important work, "The
Wages Question." This will always command a dis-
tinguished place for its author, not so much because of
its contribution of new doctrine as for its vigorous at-
tack upon old ones. "The Wages Question" really
broke the shell of Manchesterism in the United States.
In this work Dr. Walker made a successful attack upon
the wage-fund theory. This doctrine had already re-
ceived a staggering blow by Thornton (1870) but
Walker's attack was more extensive and conclusive, and,
coming only six years after Thornton's attack and Mill's
conversion, practically demolished the doctrine and
destroyed its popularity.

Another lasting contribution made by Dr. Walker
to wholesome economics, in his "The Wages Question,"
was his equally effective attack upon the doctrine of
laissez faire. Colton, Carey and other distinguished
American economists had advocated protection, but they
did not attack in any such effective manner the idea of
laissez faire as a principle in economics. Walker riddled
this, not merely theoretically but in an extensive analy-
sis of competition, showing the importance of the mo-
bility of labor to free and effective competition. In
following out this part of the subject Dr. Walker went
extensively into the condition of the wage class, showing
the laborer's inability under mere competition among
capitalists to secure an adequate share of the increasing
product of the community. This discussion was so lib-

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,96 GUNTON'S MAGAZINE

eral, and supported by such a wide range of facts, that
it gave respectability to the discussion of the wages
question as an economic proposition. It took, in fact,
the wages question out of the mere workshop vernacu-
lar and put it into scholastic economic literature.

Thus Dr. Walker really did three important things
by the publication of his "The Wages Question."
First, shattered the last remnants of the wage-fund
theory so as permanently to break its hold as a doctrine
in the United States. Second, opened a scientific war-
fare upon the doctrine of laissez faire, and thus gave
economic justification for practical popular resistance to
that doctrine as the basis of industrial policy in the
United States. And third, the book opened the door of
economic literature and class-room study to the wages
question as the laborers' problem. If Dr. Walker had
done nothing more, he would be entitled to a permanent
place among the economists of the United States.

Subsequently he published several economic works,
among which is his ' ' Political Economy, " now largely
used as a text-book in many of our leading colleges.
Being an ardent disciple of Ricardo, he was saturated,
as it were, with the principle of marginal surplus. With
great success he carried that principle, which to him
had become a dogma, from rents over to profits. His
handling of this was masterly, and, despite all the irteta-
physics of the Austrian side lights, this will probably
remain a part of impregnable economic doctrine. Yet,
strange to say, Dr. Walker was unable to carry this same
idea forward to interest. While the marginal principle
was so obvious to him that he almost grew impatient
with those who could not see it, the next and obvious
step, in applying it to interest, was to him Egyptian
darkness. He not only failed to see the application of
the law to interest, but he dogmatically denied its pos-
sibility.

EDITORIAL CRUCIBLE

THE DEATH of Mr. Dingley creates a void in the
councils of the nation which will be very difficult to
fill. Besides being intensely patriotic and public-spirit-
ed, he had the rare ability and disposition to obtain
knowledge and rationally apply it to public affairs. He
improved in this respect with every year of his public
life, until he became the authority for the House on all
important matters relating to tariff revenues, and ways
and means in general. His cyclopedic information,
laboriously gathered, coupled with his instinctive and
cultivated good sense and sound judgment, made him
the most valuable adviser to the Speaker and to the ad-
ministration that has sat in Congress during this genera-
tion. He was one of the few really influential public
men with whom the buzzing of a bigger bee in his
bonnet was conspicuous by its absence. To do what
was at hand, and be thoroughly prepared to do it well,
was the characteristic of Mr. Dingley's public life. It
was in that way that he became invaluable, not merely
as a Republican but as an American statesman. John
Bright's expressive statement at the death of Richard
Cobden, that * ' I did not know how much I loved him
until I lost him," will fittingly express the regard of
the American people for Mr. Dingley.

. THE TEXT of the new Porto Rican tariff has just been
promulgated by the President, and it specifically carries
out the doctrine of the open door. It puts the com-
merce of the United States on a substantial equality at
the Porto Rican ports with the commerce of all other
nations. The policy, of course, is not free trade for
Porto Rico; tariff is required for revenue. But it shows
that Porto Rico is not to be used merely for the com-
mercial accommodation of the United States. This is as

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98 GUNTON'S MAGAZINE [February,

it should be. There are many encouraging evidences,
that the administration is a good student of public dis-
cussion of national questions, and if it can find out what
the intelligent consensus of the nation really wants, it
will give it. That is what representative government
always should do. It is in marked contrast with an ad-
ministration which tried by executive influence to force
through an objectionable policy after it had been over-
whelmingly voted down by a general election, as in
1894. If the anti-expansion movement is intelligently
and constructively, as well as vigorously, pursued, we
may come out of the victory over Spain with ultimate
credit to ourselves and benefit to the peoples whom the
collapse of Spain's barbarizing rule has thrown upon
our hands.

No MORE THAN a leopard can change its spots can
the Spaniard conceal the characteristics of a pretentious
humbug. For a thousand years the Spaniards have
been ferocious brutes in victory, weaklings in battle,
and whiners in defeat. It is not surprising, therefore,
that Montero Rios, after having signed the treaty in
Paris, should display a lot of pretended righteous indig-
nation at the refusal of the American Commissioners to
entertain the idea of submitting the question of the
Maine's destruction to arbitration. The matter was in-
vestigated by a thoroughly reliable American Commis-
sion, which procured conclusive evidence that the bat-
tleship was blown up from causes placed in the harbor,
the control of which was absolutely in the hands of
Spanish officials; moreover, that the battleship was re-
moved from her anchorage and placed immediately over
the mine which destroyed her. The evidence is clear
to Americans that the Maine was destroyed by the
Spanish, whether it was done by the actual knowledge
and authority of the government or not. Since Spain

1899.] EDITORIAL CRUCIBLE 99

did nothing to prove her innocence she must bear the
suspicion and distrust in the eyes of the civilized world
that such a cowardly and brutal performance implies.

AGITATION is APT to lead to over-zeal of expression,
and frequently to the use of unwise adjectives. We are
likely to emphasize this only when we find inflamma-
tion in workingmen's speeches; but workingmen may
well be excused when bishops lose their heads. In his
letter to the anti-expansion meeting held in the Acad-
emy of Music in New York City, Sunday evening, Jan-
uary twenty-second, Bishop Potter charges the adminis-
tration's policy with being inspired by "greed of gain
and passion for bigness," and as "grotesque and hypo-
critical/' Such impugning of motives of those who are
in charge of the nation's affairs might be expected in a
meeting on the East Side, but it is discreditable to
Bishop Potter, and such expressions from such a source
can do the anti-expansion cause no good. The Presi-
dent and the Paris Commissioners may be mistaken.
They may take a wrong view of the true road to great-
ness in this country, as they undoubtedly do in this
instance; but it is not because of their "greed of gain,"
or because they are dishonest and hypocritical. Presi-
dent McKinley is not less honest than Bishop Potter,
and on many questions he has been much nearer right.
It is because we are opposed to expansion that we re-
gret to see an ti- expansionists, particularly educated
anti-expansionists, lose their heads and injure the cause
by saying what cannot be taken seriously.

MR. HENRY CLEWS has recently sent forth a note of
alarm from Wall Street regarding the effect of the in-
dustrial amalgamation and re-organization that is now
going on. He predicts that unless a halt is called, " It
would seem inevitable that these corporations must at

I00 GUNTON'S MAGAZINE [February,

no very distant day become a burning question in poli-
tics." There is a certain wholesomeness in Mr. Clew's
warning, but the danger is not in the process of re-
organization and amalgamation of productive enter-
prises into larger concerns. That is obviously the
tendency of the age and a part of real progress, and the
present is a period of special opportunity and incentive
in that direction. Whether these corporations will be-
come "a burning question in politics," or will constitute
a beneficent object lesson in economics, depends en-
tirely upon whether the re-organizations are conducted
on the line of improving the economic capacity to serve
the public better and more cheaply, or are used as mere
concentrations of power for profit-grabbing. To the
extent that this uneconomic policy is permitted to
characterize the present movement of industrial re-or-
ganization, and the profits made by a virtual tax on the
•community in higher prices, they will surely become
burning questions in politics, and, moreover, they will
become the subjects for caustic, socialistic handling by
the law-making powers. But if this movement is char-
acterized by economic sense and foresight, and the ben-
efits of the great economies and increased efficiency of
capital are shared with the community, in improved
quality and lower prices of products, there ought to be
no cause for alarm about the position of the corporations
or the community. But the warning cannot be too
often repeated that the combinations of capital must di-
vide their gains with the public, or they will surely be
put under the ban of " burning politics."

IN 1854 ENGLAND passed what is known as the "Half
Time Factory Act," which prohibited the employment
of children between the ages of ten and fourteen, more
than half a day at a time, attendance at school the other
lialf being compulsory. This was one of England's

1899.] EDITORIAL CRUCIBLE 101

first important steps in the direction of education and
humane factory legislation. The age of commencing
work for ' ' half-timers " has been raised from ten to
eleven, and it is now announced that a bill is soon to be
introduced into Parliament to raise the half-time age
limit another year, making it twelve, and probably rais-
ing the full-time limit to sixteen. This shows that
despite all the pressure of external competition, Eng-
land is marching on in her wholesome labor legislation.
The comparison between Lancashire in this respect
and the southern states in this country, with their eleven
and twelve hours a day, and no definite provision for
child education, is not creditable to this country. We
like to say big things about the United States, and in
many respects we can say big things with a good deal
of pride, but in respect to our factory legislation, so
far as the southern and several other states are con-
cerned, we are compelled to take second place to Eng-
land. Americans have little right to talk about the
" pauper labor" of England so long as women and chil-
dren are compelled to work eleven and twelve hours a
day, and the truck system remains in any state in the
Union, without the modifying influence of compulsory
education for factory children. In short, the hours of
labor and educational condition of the factory operatives
in the South is an economic scandal to the Republic.
Abolition of the truck system, the adoption of a ten-
hour factory law, and half-time schooling for factory
children throughout the South, is many times more
important a concern for this country than annexation
of the Philippines.

EVENTS WORTH NOTING

December 26, 1898. Iloilo, the second city in im-
portance in the Philippines, was taken by the insur-
gents two days after formal evacuation by the Spaniards.

December 28. Justin S. Morrill, Senator from Ver-
mont, died in Washington, at the advanced age of
eighty-eight. He had served in Congress continuously
since 1855, twelve years in the House and thirty- two
years in the Senate ; making the longest Congressional
career in our history. He was of the best old-school
type of dignified, upright American statesmanship.

January i, 1899. The formal surrender of Spanish
sovereignty of Cuba occurred in Havana; Governor-Gen-
eral Castellanos yielding the authority to Major-General
Wade, representing the United States, by whom it was
then transferred to Major-General John R. Brooke, Gov-
ernor of Cuba.

January i. A political crisis ' occurred in Samoa.
At the recent election of a native king, the chief Mataa-
fa received a majority, but the American Chief Justice
declared Mataafa ineligible and announced the election
of Malietoa Tanues. A battle followed in which the
Mataafa party triumphed. Chief Justice Chambers had
to take refuge on a British warship ; thereupon his office
was closed either by the German consul or the Samoan
government — reports differ on this point. The situa-
tion will probably necessitate revision of the Berlin treaty
under which Samoan affairs are now administered.

January 4.. Theodore Roosevelt, who on January
2nd was inaugurated Governor of New York, sent to
the legislature his first annual message ; the exception-
ally notable feature of which is the large space devoted
to labor legislation and enforcement of labor laws. He
recommends the Massachusetts conditional license
system as a method of dealing with the sweatshops,
and advocates increasing the number of factory

102

EVENTS WORTH NOTING 10

inspectors to fifty, and giving the Board of Factory
Inspectors authority to enforce labor laws.

January 5. A proclamation of President McKinley
to the Filipinos was issued at Manila; it announces our
intention to establish a liberal government, with all
possible popular rights, free commercial privileges, and
maintenance of existing municipal laws. In reply to
this Aguinaldo at once issued a manifesto, denying the
American right of sovereignty and calling on his
followers to stand for absolute independence.

January ij. Nelson Dingley, of Maine, chairman
of the Ways and Means committee in the House of
Representatives, died in Washington. Mr. Dingley was
nearly sixty-seven years of age, was twice Governor of
Maine (1874 and 1875), and had served in Congress
since December, 1881, with steadily increasing distinc-
tion and public usefulness. (See Editorial Crucible.)

January 18. United States senators were elected
in varioiis states as follows: Maine, Eugene Hale (Rep.);
Massachusetts, Henry Cabot Lodge (Rep.); Connecti-
cut, Joseph R. Hawley (Rep.); Missouri, Francis M.
CockreH(Dem.); Minnesota, Cushman K. Davis (Rep.);
Michigan, Julius C. Burrows (Rep.); — all to succeed
themselves. In New York, Dr. Chauncey M. Depew
(Rep.) was elected in place of Edward Murphy, Jr.,
(Dem.); and in Indiana Albert J. Beveridge (Rep.) was
chosen in place of David Turpie (Dem.)

January 19. A formal convention between England
and Egypt in regard to the Soudan provinces recently
reconquered under General Kitchener, was published at
Cairo. It provides for joint government of the Soudan,
under a Governor-General to be appointed by the Khe-
dive with consent of England. No foreign consular
agents may reside in the Soudan except by British per-
mission; and the convention entirely ignores the nom-
inal suzerainty of the Sultan of Turkey.

Civics AND EDUCATION

TWO REPUBLICS

Some months ago we promised to give in this depart-
ment a summary of the principal features of Swiss and
French political institutions. Our attention was par-
ticularly called to the subject by finding it treated at
some length in the last annual report of the United
States Commissioner of Education. In both France and
Switzerland civics is regularly taught in the elementary
public schools, and Commissioner Harris has included
in his report a translation of the text books used for this
purpose. It is encouraging to know that the importance
of education in the duties and opportunities of citizen-
ship, particularly in a democracy, is recognized in these
two old world republics, and recognized in the practical
way of making such instruction an inherent part of the
school system. In France the teaching of civics begins
with children as young as seven years of age. With
these the instruction is, of course, informal and simple.
With somewhat older pupils it deals with more specific
matters, and in the last two years of the course ' ' the
teacher discusses more thoroughly the political, admin-
istrative and judicial organization of France."

As a matter of information, we give a short sum-
mary of the political system, including methods of repre-
sentation and government, duties and functions of the
state, and popular rights, in these two republics, as
outlined in the translations referred to.

In the case of Switzerland a short history of the
development of Swiss political institutions is also given.
The germ of modern Switzerland, it is stated, was in
the league of three districts, Uri, Schwyz and Unter-
walden, in the thirteenth century. This league was
formed for common defence against outside enemies,,

104

TWO REPUBLICS 105

particularly Austria. In the fourteenth century several
important cities and districts, Lucerne, Zurich, Glarus,
Zug and Berne, joined the league, and later on others
were admitted, until Switzerland became a confedera-
tion of thirteen cantons, which maintained an inde-
pendent joint government down until 1798. Then the
system was changed in consequence of the French
Revolution. A strongly centralized constitution was
adopted, converting the old league of cantons into one
indivisible republic, made up of nineteen subordinate
districts. This worked so badly that in 1803 Bonaparte
partly restored the former status and established a Swiss
Federation of nineteen states, with increased individual
powers but still under a central authority stronger than
in the ancient confederation. After the fall of Napo-
leon a reactionary constitution came into effect, which
limited the popular rights and created great discontent.
The discontent took form in protests and uprisings of
various sorts, until in 1848 came a new constitution
which, enlarged in 1874, continues to the present day.

This constitution is modelled quite closely after
that of the United States. The national laws are abso-
lutely paramount, to any enacted in the various cantons.
A canton corresponds to a state in the American Union,
and Switzerland now has twenty- two regular cantons and
three half cantons. The union between the cantons is
not, theoretically at least, so strong as that between
the states of the American Republic. Switzerland is.
a confederation, and all rights of legislation not ex-
pressly granted to the central governing powers are
very rigidly retained by the different cantons. The
confederation has the power of carrying on all foreign
relations, declaring war and peace, regulating customs
and duties, etc. It protects the various cantons from
outside interference, and likewise protects individual
citizens of Switzerland from aggressions of officials in

io6 GUNTON'S MAGAZINE [February,

any of the cantons. Citizenship is hereditary, or may
be acquired by two years' residence in Switzerland. The
right to vote is possessed by all citizens over twenty
years of age.

Switzerland has a federal congress similar to ours.
The upper house is called the State Council, correspond-
ing to our senate; the lower house is the National
Council, corresponding to our house of representatives.
Together they make up what is called the Federal Con-
vention.

Members of the lower house are elected directly by
the people, one to every twenty thousand inhabitants.
The term of office is three years. Members draw a
salary of twenty francs per day. Members of the upper
house are elected by the cantons, two for each canton,
just as in this country we have two senators for each
state. Not all the cantons, however, elect their dele-
gates in the cantonal legislatures ; some of them do,
but others elect by popular vote. Each canton deter-
mines the salaries and length of term of its delegates.

The executive authority of Switzerland is vested in
a so-called Administrative Federal Council. This con-
sists of seven members, each one at the head of some
governmental department, similar to the cabinet officers
in this country. There is a very great difference, how-
ever, in the functions and method of election of our
cabinet officers and the Swiss federal council. The
members of the Swiss council are elected by the federal
convention and hold office for three years. The federal
convention also elects a chairman for this administra-
tive council, and he holds the title of president of the
confederation. This is as near as Switzerland comes to
having a chief executive officer in the sense that France
and the United States have a president. The Swiss
president, instead of appointing his cabinet, is himself
chosen by the same body that elects the cabinet. Per-

,899-] TWO REPUBLICS 107

laps it is in this feature more than any other that the
idea of a confederation, instead of a strongly centralized
republic, is maintained in Swiss institutions. This
chairman of the federal council, or president of the con-
federation, receives no greater salary than the other
members of the council. The term lasts only one year.
The seven departments presided over by these admin-
istrative officials are the Exterior, Interior, Justice and
Police, Army, Finances and Taxes, Industry, Agricul-
ture and Trade, Mail and Railroads.

Each canton has a legislature called the Cantonal
Council, corresponding somewhat to our state legis-
latures. The executive functions are administered by
a State Council, of several members, elected either by
the people or by the cantonal council. Each canton
has a superior court, district courts and minor courts,
-corresponding in a general way to the judiciary system
in our states.

Revision of the constitution is a much simpler
matter than in the United States. The federal council,
or any member of the federal convention, may propose
an amendment, and, if both houses of the convention
agree, the new article is submitted to the people, and
if accepted by a majority of the voters and a majority
of the cantons, becomes then a part of fundamental law.
If an amendment is desired by the people and the
federal convention refuses to submit it, a petition
bearing fifty thousand signatures will compel the. calling
of a national vote on the proposed article.

In Switzerland, laws passed either in the federal
-convention or by the legislatures of the various cantons
may, under certain conditions, be submitted to the peo-
ple for endorsement; that is, a law of the federal con-
vention must be referred to the people when so de-
manded by thirty thousand inhabitants or eight cantons.
In the cantons the custom varies. In most of them

io8 GUN TON'S MAGAZINE [February,

laws are regularly submitted to popular vote, but in
some this is done only when a certain number of quali-
fied voters so demand. In a few of the cantons the
right of initiating legislation is also possessed by the
people; that is, upon the demand of a certain number
of qualified voters, a given law must be introduced and
considered by the legislatures, or submitted to the
people.

There are no direct taxes levied by the federal
government in Switzerland. Its revenue comes chiefly
from duties and from the receipts of the postal tele-
graph service. The budget of estimated national ex-
penditures is submitted at the beginning of each year,
by the federal council, and must be approved by the
federal convention. The same system is followed by
the cantons with reference to local expenditures. The
cantons, however, have the right of direct taxation, and
their revenues are derived from that source and also-
from official dues and inheritance taxes. The more re-
cent tax laws embody the idea of progression, that is,
the rate increases in proportion to the amount of prop-
erty owned by the person taxed.

The recognized duties of the state in Switzerland
are quite extensive, and in some cases perhaps the gov-
ernmental functions extend over too far into fields that
ought to be left to private enterprise. Nevertheless,
the general principles laid down for the action of the
state with reference to promoting public welfare are in
accord with good political science. Among these duties
(and in Switzerland one of the highest) is public educa-
tion. The federal constitution compels each canton to
furnish adequate primary instruction, and attendance
upon these schools is compulsory. The federal govern-
ment itself, however, does little in the way of educa-
tion, beyond supporting a polytechnic school at Zurich.
The other duties of the state are enumerated as "Ad-

1899.] TWO REPUBLICS 109

vancement of political economy, protection of the labor-
ing class, promotion of health, preservation of nature,
and encouragement of art and science."

Under the first of these heads it is considered the
state's duty to encourage production, trade and com-
merce; and this, (while sound in general principle,) in
Switzerland is carried to the extent of distinctly pater-
nalistic and questionable measures, such as agricultural
bounties, public expositions, premiums to certain in-
dustries, public construction of dams, public operation
of telegraph and telephone service ; and now the propo-
sition to take control of the railways is being agitated.

Protection to labor is given through the medium of
laws establishing factory inspection, limitations of work-
ing hours, prohibition of child labor, accident indem-
nity, and regulation of hygienic conditions in factories.
Several experiments have been made also in the way of
granting state benefits for sickness and old age.

The state looks after the prevention of contagious
diseases, and of epidemics among animals. Cantons
are pledged to promote public health by educating
physicians, erecting hospitals and insane asylums, and
furnishing free medical attendance under certain con-
ditions.

Switzerland is certainly ahead of the United States
in respect of appreciating the value of forests and the
need of preserving them from annihilation. A special
department in each canton has charge of preserving
forests and mountain waters. It is also considered one
of the duties of the state to encourage art and science,
by establishing public libraries, art galleries, and the
like.

In Switzerland all citizens are equal before the law,
and every citizen has a right to have his cause heard by
state authority. The right of free speech is guaranteed,
and everybody can engage in productive industry ac-

io GUNTON'S MAGAZINE [February.

cording to his pleasure, exce.pt that licenses or certifi-
cates are required for the carrying on of certain busi-
nesses or practicing certain professions. Free worship-
is guaranteed, likewise the right of petition and of free
organization, political or otherwise. There is entire
liberty of the press, but it "must incur no breach of
honor."

In the matter of foreign relations Switzerland has
steadily pursued a policy of neutrality, and its neutral
and independent position is defined and guaranteed by
the powers of Europe. The little republic, therefore,
has often been an asylum for political fugitives. Switz-
erland sends to and receives from other countries, am-
bassadors, ministers and consuls, and maintains a tariff
system for revenue and protection.

In France the governmental system is much more
^highly centralized than in Switzerland. It is a thor-
oughly unified republic, and not a confederation of
semi-autonomous states. The various political divisions
in France are more for the purpose of convenience than
to reserve inherent rights to different sections of the
country. The central authority is supreme.

In general form, however, the French system is quite
similar to that of Switzerland and the United States.
There are three general divisions of governing authority,
the legislative, executive and judiciary. There is a Sen-
ate, corresponding to ours, and a Chamber of Deputies,
corresponding to our house of representatives. The sen-
ate has three hundred members, elected from the various
departments; they serve for nine years, one-third of the
senate being changed every three years. A senator
must be at least forty years of age; in the United
States the required age is only thirty.

Members of the chamber of deputies are elected
by universal suffrage, one to about each 100,000 inhabi-
tants or fraction thereof; each arrondissement has at least

I899-] TWO REPUBLICS in

one deputy. Deputies are elected every four years,
and must be at least twenty-five years of age. The
chamber of deputies has five hundred and eighty
members, and has the same legislative rights as the
senate, with the additional privilege of initiating finan-
cial measures, as in the case of the American house of
representatives. The chamber of deputies can be ad-
journed by the president of France, by advice of the
senate.

The president and his cabinet of ministers exercises
the executive authority. The president is elected by
the senate and chamber of deputies, in joint session at
Versailles. His term is seven years, and he has the
right of appointing all civil and military officers, con-
trols the army, is authorized to make peace, and pro-
mulgates the laws. He may declare war or negotiate
treaties with foreign powers, with the consent of both
chambers. Like the President of the United States, he
has the right to appoint his own cabinet members, but
the function filled by these ministers in the French
system of government is quite different from that of
members of an American president's cabinet. The
president of France generally selects his ministers from
among the members of the chambers ; they have a right
to the floor of the chambers, and are responsible for the
general policy of the government. As in England,
when measures proposed by the government are de-
feated, the ministry falls, and the president forms a new
cabinet. There are eleven ministers, in charge respect-
ively of the departments of the Interior, Foreign
Affairs, War, Marine, Justice, Public Instruction and
the Fine Arts, Public Works, Industry and Commerce,
Agriculture, Colonies, and Worship.

A Department is the largest political division in
France, corresponding in a sense to one of our states;
although, as we have suggested, the departments da

ii2 GUNTON'S MAGAZINE [February

not represent previously independent communities that
entered into a federation under the joint authority of
the republic. They are divisions established for polit-
ical convenience in the election of representatives and
administration of local affairs. Each department is
governed by a prefect, who is at once the agent of the
general government and a representative of the depart-
ment. Not only is it his duty to execute the laws of
his department, as in the case of a state governor in
this country, but he is charged likewise with execution
of the national laws in his district. His authority is
quite extensive, including approval of the department
budget, control of the expenses, examination of con-
tracts, etc. There is a local legislature in each depart-
ment, known as the General Council, containing as
many members as there are cantons in the department,
and exercising legislative powers that pertain to the
affairs of the department.

Departments are sub-divided into Arrondissements,
governed by a sub-prefect in much the same way that a
prefect governs a department. There is also a local
legislature in each arrondissement, composed of as
many members as there are cantons, though there
must be at least nine such members. This council is
charged with local legislation and with the distribution
of taxes among the various communes.

The commune is the smallest political division. It
is governed by a mayor and a municipal council hav-
ing from ten to thirty-six members, according to popu-
lation, elected for terms of four years. The mayor's
authority is extensive. He is chief of the municipal
police, and executes the ordinances of the municipal
council. He proposes the budget and nominates muni-
cipal officers.

Primary education is compulsory in France for all
children between six and thirteen years of age. They

i«99-] TWO REPUBLICS 113

must attend either public or private schools, or be
taught at home by some competent person. There are
commissioners of education in each commune, whose
duty it is to superintend and encourage school atten-
dance.

French citizens are guaranteed certain rights, in-
cluding the right to hold property and the right of
suffrage after attaining the age of twenty-one years.
No one can be compelled to pay taxes that have not
been legally voted.

The French system is distinctly less democratic
than that of either Switzerland or the United States.
The powers lodged in the executive department are
very extensive, so that the president of France in real-
ity exercises larger authority than the Queen of Eng-
land. England, though a monarchy in form, is much
more nearly democratic in spirit and in system of gov-
ernment than France. Switzerland is more democratic,
but exercises a range of public activities so broad as to
verge in some directions on socialism. In the United
States, although the general executive officer, the pres-
ident, exercises more actual power than the reigning
sovereign in England, yet he has not been entrusted
with so wide a range of authority as is given the chief
executive in the French system. In fact, though our
form of government is very similar to the French, both
England and Switzerland are much more thoroughly in
harmony with the vital spirit of our institutions.

CIVIC AND EDUCATIONAL NOTES

Columbia University has taken a step in the right
direction by establishing a department in practical road-
Instruction making, in connection with the engineer-
in ing and mechanical work of the Univer-
Road-making sity Scientific road-making has reached
a point of such importance, especially here in the East,
that the necessity of adequately testing the road ma-
terials available in different localities has suggested the
establishment of departments devoted to this purpose
in connection with educational institutions. Harvard,
however, is the only other university so far that does
work of this sort. It is understood that students taking
the engineering course at Columbia will hereafter have
an opportunity to receive instruction in practical road-
making, which is a line of education that has not here-
tofore been offered. Credit is due, by the way, to the
efforts that have been made by the organized wheelmen
of the country in promoting the cause of good roads.
It is said that the establishment of this department at
Columbia was first suggested and urged by the League
of American Wheelmen.

Down in North Carolina they are talking very seri-
ously of withdrawing educational opportunities, in large
Curtailing part, from the colored race. In other
Negro words, the proposition is to devote all

Education the money collected for educational pur-
poses from white inhabitants to the education of white
children, and let only that which is collected from
negroes be applied to educating negro children. This
scheme, which is speciously defended as " justice," is
in reality contrary to the principles of taxation that
apply almost universally in civilized countries, and can
only be considered as an effort on the part of the south-

114

CIVIC AND EDUCATIONAL NOTES 115

erners to escape a public duty. If the argument were
sound, it could be applied in every state in the Union,
not in reference particularly to colored children, but
with reference to the children of the poor everywhere.
Most of the taxes for public education are paid by the
well-to-do classes, who could educate their own children
if necessary, but the schools are open to the rich and
poor alike. There is no injustice in this, because it is
one of the means the state has to take to protect itself
from the danger of developing an ignorant population,
from whose follies, moreover, the rich would be the
chief sufferers.

One of the minor explanations given of this North
Carolina idea, however, really lets the cat out of the
bag. It is said that the negroes are getting so much
education that they all want to be ministers and lawyers
and doctors, and will not work in the fields; and that
there is a general demand for good field hands which is
difficult to supply. When we come to look at the figures
and see the meagre amounts spent on education, both
for white and black, in the South compared with the
North, we cannot help marveling that the colored race
there- should have such a predisposition toward the
learned professions that a mere skimming through the
very rudiments of education unfits them for practical
industrial labor.

The fact is, the North Carolina people are not really
afraid of any shortage of field hands, but what they do
not like is to see the tendency towards higher develop-
ment in the colored race, leading them to insist upon
higher wages for the work they do perform. The
planters would like to have the negroes remain in the
same condition of stolid ignorance and indifference that
they occupied before the war, because in that condition
they can be hired at almost any price and are not
troublesome about conditions of work or hours of labor.

n6 GUNTON'S MAGAZINE [February.

With the increasing degree of education, however, and
information about the outside world, it is natural that
they should be getting more troublesome and afflicted
with uncomfortable ideas of better wages and higher
social standards. Undoubtedly this is what lies at the
bottom of the proposition to deprive them of education.
The scheme ought to meet with most vigorous opposi-
tion, and, if public sentiment against it in North Caro-
lina cannot be made strong enough to defeat the scheme,
at least it ought to be headed off elsewhere without
delay. It is just the kind of a proposition that we
should expect to see heartily endorsed throughout all
the southern states. What little progress has been
made in the civilization of the colored race in the South
must be preserved and extended. The proposition
shows, anyway, how far we are as yet from a solution
of the southern problem, and does not offer very en-
couraging promise with reference to the far worse race
problems facing us in our new possessions.

Right in line with our article last month on
" Teaching of Economics in Schools," we find in a re-
Civics and cent number of The School Review some
Economics interesting information in regard to what
in Schools is aiready being done in that direction.
The Principal of the Hyde Park High School, in Chicago,
sent out a series of inquiries to a considerable number of
selected schools throughout the United States, asking
what instruction is given in civics and economics and
what are the the results obtained. Fifty replies were
received, thirteen being from grade schools and thirty-
seven from the higher secondary schools.

Of course, this has nothing of the character of a gen-
eral investigation of the subject, but it is a straw, per-
haps, indicating the tendency throughout the country
with reference to instruction in these subjects. It ap-

1899.] CIVIC AND EDUCATIONAL NOTES 117

pears that civics in some form is taught in all the
schools that reported; economics is not taught in any of
the thirteen grade schools, but is taught in thirty of the
secondary schools. In these secondary schools, however,
it is taught only after the second year's work. Some of
the replies in regard to the methods pursued in teach-
ing civics and economics are interesting; for instance:

<4In civics a text-book is used, but the general
method is discussion, very little of the so-called recital.
Boys are encouraged to bring to class matter they find
in magazines and newspapers bearing upon the topic
under discussion. Each student writes at least one
article each year upon some topic approved by instruc-
tors. These generally concern economic fact."

' ' In political economy the industrial history is de-
veloped and topics not considered in the text are pre-
pared. The views of other schools of economists than
that of their author are prepared."

" Economics, text-book and library work, supple-
mented by investigation and reports upon industries
and institutions of the pupil's own city."

One of the questions asked was, " What evidence
have you that the right civic knowledge given to pupils
in your school has resulted in better citizenship ? "
Among the answers to this were the following:

* * My graduates talk more temperately and intelli-
gently than many grown citizens."

" The fact that the children are interested in mu-
nicipal affairs through civics has carried earnest thought
to many of their homes."

' * Pupils think and believe more in the right di-
rection, which will doubtless work out in better living
at a later period."

1 ' The stand taken by the young men in state and
local politics and questions indicates that they were
started right in school."

nS GUN TON'S MAGAZINE

' ' Intelligent participation in public life by certain
graduates."

' * I think pupils are more tolerant of differences of
opinion, more interested in civic questions, and better
prepared to reason and judge concerning them."

Among some of the answers received from school
principals in regard to the general idea of instruction
on these subjects were the following:

"The subject has been so badly neglected that
many educators, statesmen, and philanthropists have
formed a national society — The Patriotic League — to
work for a reform in this direction, and hope all who
approve their action will join them."

' ' I think it is the great reason for which the schools
should be sustained: and the salvation of our nation
rests upon it more than people realize or will realize,
until educational people require that citizenship be
taught by a more generous history course in every
school."

' ' Some emphasis has been given to the fact that
schools fail in so far as their work must be undone in
the sphere of the citizen."

* ' The method must be adapted to the maturity of
the student. Civics can be comprehended by the
youngest high-school boy, and furnishes material for
growth in power for the oldest. The facts should be
taught objectively so far as possible."

These replies it seems to us indicate that there is
at least a rapidly growing interest in the subject of civic
education, and that the scanty experimenting already
done shows that very much larger, more thorough and
systematic work is feasible, desirable and necessary.

SCIENCE AND INDUSTRY

CUBA'S INDUSTRIAL PROBLEMS

On the first day of January Spanish rule in Cuba,
of nearly four centuries duration, came to an end.
With the formal transfer of authority in the Governor
General's palace, the last link connecting- the western
hemisphere of to-day with the early period of Spanish
discovery and exploration was broken. In the normal
evolution of civilization the old shell of despotic institu-
tions has gradually been outgrown, cracked and broken,
and now the last remaining vestige has been cast aside
and all America stands free and unhampered, facing a
future full of opportunities such as have never awaited
any other lands or peoples. Canada may be cited as
still under foreign dominion, but in reality Canadian
institutions are almost as free as our own.

The United States is now in possession of Cuba
and may remain so for a considerable time. Charged
with the responsibility of establishing a safe and just
government in the island, it may find that years instead
of months are necessary to the carrying out of this pro-
gramme. At the very outset it has a three-fold prob-
lem to face. It must re-organize the political system in
such a way as to promote the growth of self-govern-
ment. It must also reform and redeem the administra-
tion and sanitary conditions of the cities throughout the
island; and, finally, and perhaps most important of all,
it must take hold of the industrial problems now pre-
sented as the result of generations of official plunder
and years of civil strife.

The political reorganization of Cuba promises to be
a most perplexing matter. Nobody knows anything
about the capacity of the inhabitants for self-govern-
ment, and only by experimenting can it be determined

119

120 GUNTON'S MAGAZINE [February

just how far, with safety, they can be let into a share in
the direction of affairs. The attitude of the insurgents
is uncertain in the extreme, and if it shall appear that our
presence in the island is necessary for a long period, and
that we must pursue a stern and vigorous policy, it may
be that the rebel army in its disappointment will stir up
another revolution, transferring the point of attack from
Spanish to American authority, and thus bringing the
work of political and industrial reform to a standstill.
In the very nature of the case, many of the high ex-
pectations entertained by the Cuban population cannot
be realized. To them it has seemed that the simple
throwing off of the Spanish yoke would bring with it
not merely political independence, but steady and uni-
versal employment and a free hand with the public rev-
enues. A people of the social type and character of the
Cubans necessarily look upon government as a paternal
institution, charging almost all their wrongs to it, or
looking to it for employment and support.

This tendency has been shown already, in a very
violent way, in our experience in the matter of customs
receipts at Santiago. For several months after the
conquest of that city all the customs receipts there col-
lected were applied to municipal improvements right
on the spot, and the result was that thousands of
Cubans were immediately given employment by the
government. But of course, when we entered on the
work of reorganizing the whole island, the policy of
applying customs receipts to the expenses of the par-
ticular port where they were collected had to be aban-
doned. There was no more reason why all the duties
collected at Santiago should be spent there than that
the revenues collected at the port of New York should
be retained for the local expenses of that city. A cer-
tain proportion of the income was to be returned to-
Santiago, but not all of it, and the consequence was a

1899.] CUBA'S INDUSTRIAL PROBLEMS 121

prospective cutting down of the work of public improve-
ment and limitation of the field of employment. This
almost produced a revolution. The natives looked to
the American authorities for employment and support.

We began by giving them rations outright, next
by furnishing work to all who applied. Of course this
could not continue forever; but the very fact that the
curtailment nearly brought on an insurrection shows
the serious nature of the problem we are called upon to
face in dealing with this kind of people. They have
not yet really come into the stage of self-reliant, inde-
pendent, law-abiding citizenship. If discharged from
work for the city, their sole resort was to go to the hills
and practice brigandage on travelers. The outlook is
not encouraging, when we think of establishing a
democratic system of suffrage and putting the govern-
ment of the island and control of its finances and prop-
erty interests in the hands of people holding this sort
of idea of their personal responsibilities and relation to
the government. There is, however, some reason for
their desperate state of mind at the prospect of being
discharged from work, as we shall point out later on.

The work of reforming the cities, both from a po-
litical and sanitary standpoint, is another immense
problem. The regular order of affairs heretofore has
been systematic plunder of public revenues by Spanish
officials. Moneys collected for various public improve-
ments, even to maintain the ordinary indispensable
conditions of decency, have been diverted to private
purposes. So customary has this been that public sen-
timent even has become deadened on the subject, and
whatever public improvements are made now will be in
the nature of pure paternalism on our part, instead of
as the result of a popular demand carrying with it will-
ingness and capacity to help in the work of reform.
Most of the coast cities have fine harbors, but are un-

122 GUNTON'S MAGAZINE [Februar

provided with adequate piers for large shipping. The
work of loading and unloading has been done by light-
ers, and the construction of piers has been delayed
chiefly because, so it is said and is natural to suppose,
the Spanish officials have found it profitable to let the
lighterage business continue.

With regard to sanitation the conditions are fright-
ful, and the neglect has been criminal. We read the
reports of the late Colonel Waring and of General
Francis V. Greene, in regard to Havana, with amaze-
ment. Though the water supply is fair, there is practi-
cally no system of sewerage, and the public streets
themselves are made the chief repositories of the filth,
garbage, dead animals, and drainage of the city. Near-
ly every house has a cess-pool in its yard or cellar. It
is to these conditions that the periodical outbreaks of
disease in Cuba are due. The climate, during the rainy
season, is enervating of course, but not necessarily
productive of disease. Inhabitants of the rural regions
of Cuba are not afflicted by pestilences except as they
are communicated from the pest centers, where the
filth itself breeds, harbors and propagates disease.
Great sums of money will be necessary to remedy this
state of affairs and provide the large cities of Cuba with
proper sewerage and water supply systems, establish
rigorous and effective sanitary inspection, and enforce
sanitary regulations. Even if we continue to tax the
Cubans as heavily as did the Spaniards, the proceeds
will not begin to cover the necessary cost of the muni-
cipal improvements alone that are necessary. As we
have said, General Wood found that the entire customs
receipts at the port of Santiago were no more than enough
to inaugurate and keep going the reforms and improve-
ments needed in that one city. Practically nothing
could be realized from local taxation there.

If, therefore, we are to put these Cuban cities in

I899-] CUB AS INDUSTRIAL PROBLEMS 123

the condition which civilization and decency demand,
we shall have to appropriate money from our own
treasury for the purpose, or else prolong our period of
control there almost indefinitely. Certainly it will not
be safe to leave Cuba to herself and put the control of
affairs in the hands of the Cuban population so long as
the population is of the sort that the conditions now ex-
isting inevitably produce.

Industrially, the island is practically in chaos. What-
ever else is done, it is this end of the problem that must
be set right before self-government can be successfully
established. So long as the bulk of the inhabitants are
without means of regular and sufficient support, through
normal economic channels and without reliance on gov-
ernment, to put the political authority in their hands
would lead at once to unmeasured corruption and all
sorts of socialistic experiments. There is no lack of in-
dustrial opportunities in Cuba, and, under a strong and
safe government and freedom from civil warfare, the
island is capable of great development and steady pros-
perity. Its industrial future need not be confined en-
tirely to sugar-cane growing. When peace and security
are guaranteed there will be a large field for the culti-
vation of fruits, tobacco and coffee. Cattle herding is
likewise a profitable industry, and there are deposits of
iron which can be exploited much more thoroughly
than an present when adequate capital and enterprise
are applied. New railroads must be built and many old
ones reconstructed.

Nevertheless, sugar growing and manufacturing
will probably remain the chief industry of the island.
Doubtless in time the refining of Cuban sugar will be
done within the island, and nothing could be better for
the social development of the people than the growth
of just such manufacturing centers as this would give.
Cuba is the greatest cane sugar territory in the world.

124 GUNTON'S MAGAZINE [February,

Its annual production, of about one million tons, is
more than double that of Java. So admirably adapted
are the soil and climate of the island to this industry
that it has prospered even under the official plunder to
which it has been subjected by the Spanish government.
There is opportunity, furthermore, for extension of this
industry far beyond its present limits. Mr. Wilfrid
Skaife, a civil engineer who has been engaged in the
manufacture of sugar in Cuba, says, in the Engineering
Magazine, that " great tracts of land are available for
sugar cane which are yet a wilderness." A great deal
of modern machinery has been introduced for the manu-
facture of cane sugar, but the methods of planting and
harvesting are still very primitive. In this line, says
Mr. Skaife, "there is a crying need of machinery. The
planting of the cane is nearly all done by hand. There
are a few cane-planting machines, but little is known
about them. The weeding is done by hand in the ma-
jority of instances, and finally the harvesting is done
with a knife, and a laborious business it is. It takes five
hundred men per day to cut the cane alone on a large
estate, to say nothing of loading and teaming to the
railroad tracks; and the man who can successfully solve
the problem of a cane harvester has a large field to-
work in."

Besides machinery, the future development of the
sugar industry in Cuba demands an adequate system of
public roads, additional railroad lines, and, perhaps
most important of all, a period of peace and security to
property which will save the expense of protection
against marauders and insurgent uprisings. Says Mr.
Skaife: "Common roads for wheeled vehicles hardly
exist except in the near vicinity of the larger towns.
What is known as the Camino Real (Royal Road) is
merely a broad strip of country, sometimes fenced by
cactus and barbed wire and passable on horseback and

CUBA'S INDUSTRIAL PROBLEMS 125

~by ox-carts in the dry season. The only time, in fact,
in which hauling can be done to any extent is during
the long dry season, when the field roads made by the
:sugar and tobacco estates can be traversed by great two-
wheeled carts with four oxen. Two days of rain stops
traffic in all directions. The opportunity for the build-
ing of common roads is larger, and in most places there
is plenty of stone for the purpose."

How important the establishment of peace through-
out the island will be, in its saving to the sugar indus-
try, is shown by the statement of this writer that ''in
times of revolution, like the present, it costs an estate
thirty to fifty thousand dollars a year to defend its
fields."

In time, now that Cuba is rid of the repressing in-
fluence of Spanish rule, American capital and enterprise
will enter and develop new industries and extend the
scope and improve the character of those already exist-
ing. Eventually, there is no doubt, Cuba will become
a prosperous, self-reliant, industrious community, of-
fering adequate employment to labor and a good field
for profitable investment.

But that has to do with the future. The immediate
problem is pressing in the extreme, and cannot wait for
long-time economic forces to bring about results that
are immediately necessary. Prior to the outbreak of
the war a large part of the laboring population of Cuba
had been withdrawn from the fields and huddled to-
gether in pest camps near the cities. When the war
began all relief from America in the shape of supplies
and medical help was of course cut off, and the condi-
tion of these sufferers since that time has been even
worse than when the order of reconcentration was first
being enforced. The results have been two-fold.
First, the people themselves, or such of them as re-
main alive, have been reduced almost to physical

126 GUNTON'S MAGAZINE [February,

wrecks with neither ambition nor capacity to return and
re-establish themselves among the ruins of their former
homes. Second, the rural country, during this long
period of neglect, has become largely overgrown with
weeds and underbrush. The cottages, barns, imple-
ments and live stock have been destroyed, and it is im-
possible for these small farmers and laborers to go back
into this wilderness, unless provided for a considerable
period with the tools necessary to reclaim the land.

A voluntary organization known as the Cuban In-
dustrial Relief Association, which may be reached at
No. 30 Broad Street, New York City, has proposed a
plan for dealing with this situation, which has been en-
dorsed by the War Department, and seems to be a
feasible method of relieving the immediate emergency.
The plan is proposed by Mr. William Willard Howard,
a gentleman of considerable experience in Armenian
relief undertakings, and who has personally investi-
gated the conditions in Cuba. It was explained in de-
tail by him in an address delivered not long ago in
Plymouth Church. Two or three paragraphs from
this address will give the gist of the proposition.

' * In my investigation of the condition of Cuba I
was strongly impressed by the pride and sensitiveness
of the people, and I became convinced that in giving
aid to the Cuban poor we should be confronted by a
problem that would put to the test the measure of our
progress in civilization

1 ' What shall we do with the Cuban poor ? Shall
we, by temporary gifts of free soup and old clothes,
brand them as paupers in the eyes of the whole world ?
Now that we have placed them upon the threshold of a
new life as a self-governing people, shall we so degrade
them by indiscriminate charity that they may never
lift their heads as self-respecting people among the free
nations of the earth ? Our responsibility is overwhelm-

i8Q9.] CUBA'S INDUSTRIAL PROBLEMS 127

ing. Is our humanity as equal to its emergency as our
warships were to theirs ?

' ' My plan for dealing with the problem of the
Cuban poor is to help the poor to help themselves.
Instead of pauperizing gifts of food and clothes I
would give honest employment. The details of my
plan are simple and easily understood.

" i . A tract of good farming land should be se-
cured near a city or town where the need of the poor is
most pressing.

11 2. A thoroughly capable American should be
placed in charge of this land, with sufficient funds at
his disposal to give employment to a considerable num-
ber of men.

''3. This American should offer to the able-
bodied poor of the neighborhood day's work at plough-
ing, planting and cultivating this land. The workers
should be paid the full local market value for their
labor.

"4. Only the common food crops of the island
should be grown. When the crops come to maturity
they should be sold for cash in the best available mar-
ket. The money received should be turned back into
the fund and used again in the same way. This should
be continued until the need for this kind of relief no
longer exists.

"5. At the earliest practicable moment individual
workers should be assisted to return to their old homes to
begin their broken lives anew. This will be determined
solely by individual circumstances, and not by any
philanthropic desire to thrust them forth in crowds sim-
ply because the war is ended and Cuba is free. No in-
dividual should be sent to his old home until he is men-
tally, morally and physically capable of going. The
assistance given should not be in the form of a charity.
It may be, and should be, a plain business transaction.

I28 GUNTON'S MAGAZINE [February,

The giving of tools and seed and farm oxen and provi-
sions, as a charity, should under no circumstances be
permitted. The assisted farmer should be required to
repay, with interest, the full value of the assistance
given. This will not be looked upon by him as a hard-
ship, but as an ordinary business transaction such as he
has been accustomed to all his life. Nor will it in real-
ity be a hardship. The soil of Cuba is wonderfully fer-
tile, and, with ordinary diligence, farming is a profit-
able enterprise."

This proposition may, of course, impress one at
first sight as merely a form of charity in disguise. Per-
haps it is so, and yet there are times when even the call
for charity is imperative ; and the problem becomes one
of how to administer the relief so as permanently to
help and in no wise pauperize the recipients. Eco-
nomic forces will ultimately solve the industrial prob-
lems of Cuba, but at the immediate present there is
actual need of some philanthropy, and if we can have
philanthropy working through economic methods, so
much better. It would seem that these proposed colo-
nies in the vicinity of cities, which could be used as re-
storing agencies and distributing centers for reviving
the destitute population and sending them back to their
former homes, adequately supplied with means of sus-
tenance and work, all on the basis of rendering service
for whatever is received and accepting debt obligations
for whatever is furnished, partakes as little as possible,
under such circumstances, of the nature of charity. In
fact, from the recipients' standpoint there is no charity
about it at all, unless it be in the nature of the treat-
ment and interest in them which would be taken by the
managers of these farms. A little of that, however,
can very well be excused under the pitiable conditions
that now exist. In fact, there are no conditions under
which a little of ordinary humane consideration will not

I899-] CUB AS INDUSTRIAL PROBLEMS 129

make even the great interworking wheels of economic
society run more smoothly and last longer. It might
be, moreover, that in the end these colonies or farms,
if conducted on the basis proposed, would pay for them-
selves and reimburse those who now contribute to their
establishment; in which case the whole enterprise would
be economic in its results, if not wholly so in its incep-
tion.

It is an emergency proposition, made to meet an
emergency. As Mr. Howard says, " The rehabilita-
tion of Cuba will not be the work of a day. Five years
will not build up what five days can tear down. The
present condition of the cattle industry is a fair type of
the general state of Cuba. An impoverished cattle
grower, who lost nearly two thousand cattle at the
hands of the Spaniards and the Cuban insurgents, in-
formed me that it would require five years' time in
which to replenish, by importation, the depleted stock
of cattle throughout the island. The province of Matan-
zas, which had 260,000 cattle before the beginning of
the Cuban war, has now less than 5,000. . . . Last
February I rode over the devastated fields of a Cuban
planter who, before the war, was worth a quarter of a
million dollars, but was at that time working in a New
York hotel for twenty dollars a month. In another
district I rode through the ruins of a large plantation
house, the owner of which, a General in the insurgent
army, was dependent upon the kindness of a friend for
the support of his wife and children in New York. It
will not be questioned that these men will need bor-
rowed capital for the reconstruction of their estates ; yet
they are only typical cases. I believe that I am justified
in saying that fully ninety per cent, of the landowners
of Cuba are in the same unhappy situation. Until the
planters obtain money with which to set the ploughs in
motion the industrial life of the island will remain dor-

i3o GUNTON'S MAGAZINE [February

mant. Neither sugar mills nor tobacco factories will
be able to turn a wheel in the ordinary course of busi-
ness until the planters come with their crops. All
classes of workers, from ploughboys to factory hands,
will remain idle."

There is no question that the United States has a
duty to perform in rehabilitating industrial Cuba. Our
interference in the Cuban war, and expulsion of the
Spaniards, places upon us a responsibility which can-
not be escaped. The war was undertaken in the name
of humanity, but humanity does not consist merely in
destroying one political system and setting up another,
while doing nothing to relieve the conditions of the
people who have, through and because of all this strug-
gle and the previous period of rebellion, been reduced
to want and industrial helplessness. Our duty here is
prior even to any that awaits us either in Porto Rico,
Hawaii or the Philippines, because it was for the sake
of Cuba that the whole policy which has resulted in the
acquisition of these islands was undertaken. If it shall
appear that individual philanthropy is not sufficient to
establish and carry out some such form of industrial
relief as we have instanced, the government should be
prepared to take up the matter itself.

It may be said that to do so would merely point the
way towards numerous similar expenditures in^improv-
ing the conditions in all the other barbarian and semi-
barbarian communities we have acquired; but this is
one of the things that the expansion policy inevitably
involves. Only, in the case of Cuba, we can do it will-
ingly and with good grace, because we undertook the
war solely for the purpose of removing a tyrannical and
oppressive government and making progressive civiliza-
tion possible there, and we propose to give Cuba to
herself just as soon as it is practicable. In the case of
the other communities, however, the question is still

iS99.] CUBA'S INDUSTRIAL PROBLEMS 131

open and debatable. To assume the work of regenerat-
ing, at great expense, three other entirely distinct and
uncivilized communities, is indeed a most questionable
and dubious task, and one whose undertaking would prob-
ably mean diverting the resources, energy and atten-
tion of this nation from the paths of its highest useful-
ness to humanity.

With Cuba, however, the responsibility and duty
are plain and not to be evaded. The helpless popula-
tion must be provided with opportunities of working
themselves back to a condition of permanent self-
support. The cities must be purified, reconstructed
and honestly governed. Educational opportunities
must be provided. Finally, the population must be
gradually admitted to increasing measures of self-
government, in proportion to their proved capacity to
maintain order and secure popular rights, /until finally
the directing and guarding hand of the United States
can be withdrawn. Then, and then only, will our duty
to the island whose government we destroyed for the
sake of humanity, be discharged.

SCIENCE AND INDUSTRY NOTES

An important English ship-building firm, Short
Brothers, of Sunderland, have recently issued a report
on the results of seven years' experience
with the eight-hour system in their estab-
lishment. Under the old system the
men began work at six in the morning, took half an
hour for breakfast at eight o'clock, half an hour at noon
for lunch, and quit work at five. Many were unable to
endure the long hours, and large numbers of employees
regularly lost a portion of their wages each week from
forced absence from duty. Now the men get their
breakfast before beginning work. They start at half
past seven and finish at five. Under this plan they not
only do more work but the general operation of the
plant is much more economical. This has been practi-
cally the universal experience wherever the shorter-
hour experiment has been tried, either by voluntary
action, as in this case, or by uniform legal restrictions.

The Nicaragua Canal Commission, which has spent
ten months in making careful surveys and examinations
Report on °f the various routes proposed, submitted
Nicaragua a preliminary report to the State Depart-
Canal ment on December 29th. It finds " that

the construction of a canal across Nicaragua is entirely
feasible. The estimates for two of the best known
characteristic routes have been nearly completed.
These routes are known as the Maritime Canal Com-
pany's Route and the Lull Route. Their estimated
cost is approximately $124,000,000 and $125,000,000
respectively." The commissioners state that in their
opinion "the Lull Route is the more desirable, because
it is easier of construction, presents no problems not

132

SCIENCE AND INDUSTRY NOTES 133

well within good engineering precedents, and will be a
safer and more reliable canal when completed."

A full and exhaustive report is to be submitted in the
near future, and it is to be hoped that practical steps
will be taken by Congress without delay to secure the
construction of this canal, either by guaranteeing the
cost under proper conditions, or, if necessary, by
authorizing it as a public undertaking.

An illustration of the way in which the benefits of
advanced industrial civilization are extended to less
Genuine progressive countries has recently been

American furnished by a visit of European capital-
Expansion ists to some Of the great iron works in
this country. It is said that no less than a dozen great
plants, representing an investment of $100,000,000,
modeled after American establishments and using
American methods, will be erected in Germany,
France, Austria and Hungary. The cheaper and better
product that this will make possible will be of peculiar
benefit in the countries named, because they are very
large consumers of iron, not only in large buildings
and engineering works but even in the construction of
dwellings.

Thus, by developing our own possibilities in this
line at home, we have not only established a high type
of industry here but made it possible to extend better
methods of production to other countries. This is the
sort of practical American " expansion " that the world
needs. Had we been content to throw down all barriers
and refuse to develop our own possibilities, for fear
such action might be considered a species of selfishness,
we would not only have been far behind our present
standard to-day but would not have developed anything
capable of conferring any benefit upon others.

CURRENT LITERATURE

THE CITY WILDERNESS*

South End is the slum end of Boston. North End
is another slum section of the Massachusetts metropolis.
This book is devoted to a description of the life of the
slum inhabitants of South End. Each topic forms a
chapter, and is furnished by a different author, but al-
ways by an active worker in the district. The book is
another contribution to the municipal literature of the
country.

The third chapter is devoted to an analysis and re-
view of the nationalities and social character of the
population. It appears that the Irish are wonderfully
in the lead in the Boston slum population as compared
with all other foreigners. They about equal the native-
born. The Polish Jews, however, appear to be rapidly
gathering strength. According to the writer, the
power of the Jews to defy their environment, live right
on the same street and in the same house with the Irish
and negroes without apparently being at all affected by
them or having anything to do with them, is a quality
which gives the Jews the advantage over most of the
others in their ability to live and maintain their status
where others would decay and die. "They receive,"
says the writer (page 41,) " with pleasure everything
which is offered, except the religious teaching. To
this they seem to be entirely indifferent. ' I don't care
•what you teach my children at your Sunday School,'
said one Jewish woman. ' It won't make any difference
with them.' "

* The City Wilderness, A Settlement Study by Residents and
Associates of the South End House, Boston. Edited by Robert A.
Woods, head of the House. Houghton, Mifflin & Co., Boston and New
York. Cloth, gilt top, 311 pp. $1.50.

134

" THE CITY WILDERNESS" 135

" The Jew has a surprising power of endurance,"
says Mr. Bushee. " If employed under a hard master,
he still works on under conditions which would drive
the Irishman to drink and the American to suicide,
until finally he sees an opportunity to improve his con-
dition. Surely the modern Jew must have been the
' economic man ' upon which the ' dismal science ' was
founded." But this ability to endure dirt and squalor
does not appear to be at all encouraging to the student
of South End life.

The writer finally agrees that this problem is
largely a problem of immigration, which indeed all
students of municipal reform in this country must
recognize. It may sometime again be true in this
country, as it was fifty or more years ago, that
unlimited immigration may be helpful to the nation,
but to-day the great municipal problem which presents
itself to the American people demands, in order that we
may have an opportunity even to commence to deal
with it, that immigration shall be greatly restricted, and
it ought to be stopped for a few years at least. This is
fully borne out by the investigation of the " City
Wilderness " of Boston.

According to Mr. Woods, who writes a chapter on
"Work and Wages," legislation in Massachusetts has
gone far to stamp out the sweating system in Boston.
He says (page 87): "Massachusetts legislation against
the sweating system has practically abolished that in-
iquity in Boston; while the general legislation of the
State — including the limitation of the weekly hours of
work for women and minors to fifty-eight, the prohibi-
bition of child labor under the age of fourteen, and the
requirement of rather strict sanitary regulations — pre-
vents a low order of factory industry." This is indeed
very encouraging. New York may well take hold and
apply itself to the sweat-shop conditions of its own slum

i36 GUNTON'S MAGAZINE [February,

districts. The thing that has done so much to extin-
guish the sweat-shop in Boston is the law recently
passed by the legislature of Massachusetts forbidding
the use of any buildings for manufacturing without a
permit from the factory inspectors certifying to its fit-
ness to be used for such purpose. All buildings found
to be used for manufacturing without such permit were
violating the law, and without further evidence were
subject to the penalty. In his message to the legisla-
ture, Governor Roosevelt recommended the adoption of
this permit feature for New York City, and it is to be
hoped that the legislature will lose no time in convert-
ing the Governor's recommendation into law.

In the chapter "The Roots of Political Power" a
curious phase of South End life is revealed. It is what
the author designates as the "gangs," to which he says
almost every boy in the tenement-house quarters be-
longs. "The boy who does not belong to one is not
only the exception, but the very rare exception." In
an elaborate description of the make-up and manage-
ment of these gangs we are told that they meet on what
is called the "corner" (though it may be in the middle
of the block). They do all sorts of audacious things at
first, from "scrapping" with each other to molesting
pedestrians on the street. These gangs have one or
more leaders, who acquire their positions, like the pred-
datory chief, by being the best scrappers or the tough-
est fighters or the biggest bullies. In the history of
these gangs the author traces the evolution of the ward
boss. The one who can most successfully bully the
gang becomes the political boss of the ward. These
gangs of boys range from fourteen to sixteen years of
age up. When they begin to have more serious objects
than insulting pedestrians and annoying policemen,
they begin to have clubs. That is, they meet in a
room. Sometimes they hire an old house. One of the

I899-] " THE CITY WILDERNESS" 137

invariable features of these clubs is one or more balls or
dances during the winter, where the girls as well as the
boys can be invited in, and thus a social status and in-
fluence is established. From these clubs they move
into political action, deal out the patronage, make or
unmake candidates for public office, and ultimately
make their imprint upon the election machinery
of the state and nation, as well as the city.

All this shows that the work of education goes on
whether we will or no, and if it is not organized and di-
rected in the lines of wholesome ideas and responsible
conduct, it will organize itself for the destruction of all
that is decent in society. Wesley resolved that the devil
should not have the monopoly of good tunes. It is time
that public educators and students of political science,
leaders of public opinion and of public policy, should
resolve that the real effective methods for organizing
public action among the masses should not be monopol-
ized by the vicious and neglected elements of society.
If we would really effectively deal with the municipal
problems we must not descend upon the population with
the stilted methods of the successful and favored classes,
but we must approach them through the methods that
they themselves inaugurate, and with which they are
familiar, viz: through their club life, largely of their
own making. This is the direction in which the next
great step in popular education must be taken. If the
civic problems which are threateningly confronting us
are to be solved consistently with democratic institutions,
we must restrict immigration, repress the sweat-shops
and educate the people through the methods of their
social enjoyment. This is the way that educational
forces must reach the under-side population of our large
cities if Tammanys are to be abolished and the cities to
be a strength instead of becoming a menace to the Re-
public.

ADDITIONAL REVIEWS

YESTERDAYS IN THE PHILIPPINES. By Joseph
Earle Stevens. Charles Scribner's Sons, New York.
1898. 232 pp. $1.50.

The author lived in Manila during the years 1894
and 1895, and made several trips inland, as well as one
sea voyage to islands other than Luzon. He writes an
interesting narrative of his experiences, and description
of the country and people, though the latter it must be
said is somewhat superficial. The book consists of a
series of letters written in a semi-humorous fashion, as
is perhaps not surprising in the case of a young man
suddenly introduced to a series of violent and ludicrous
contrasts with the social conditions and customs of
Boston.

Mr. Stevens represented the only American firm
in the Philippine Islands, H. W. Peabody & Company,
of Boston, and that house closed up its business and
withdrew its representative two years ago. Mr.
Stevens was not infatuated with what he saw in the
Philippines, and on the question of annexation says, in
the introduction to his book:

" Do we want them? Do we want a group of 1400
islands, nearly eight thousand miles from our Western
shores, sweltering in the tropics, swept with typhoons
and shaken with earthquakes ? Do we want to under-
take the responsibility of protecting those islands from
the powers in Europe or the East, and of standing
sponsor for the nearly eight million native inhabitants
that speak a score of different tongues and live on any-
thing from rice to stewed grasshoppers ? Do we want
the task of civilizing this race, of opening up the jungle,
of setting up officials in frontier, out-of-the-way towns
who won't have been there a month before they will

wish to return ?

138

ADDITIONAL REVIEWS 139

* ' The Philippines are hard material with which to
make our first colonial experiment, and seem to de-
mand a different sort of treatment from that which our
national policy favors or has had experience in giving.
Besides the peaceable natives occupying the accessible
towns, the interiors of many of the islands are filled
with aboriginal savages who have never even recog-
nized the rule of Spain — who have never even heard of
Spain, and who still think they are possessors of the
.soil. Even on the coast itself are tribes of savages
who are almost as ignorant as their brethren in the in-
terior, and only thirty miles from Manila are races of
dwarfs that go without clothes, wear knee-bracelets of
horsehair, and respect nothing save the jungle in which
they live. To the north are the Igorrotes, to the south
the Moros, and in between, scores of wild tribes that
are ready to dispute possession. And is the United
States prepared to maintain the force to carry on the
military operations in the fever-stricken jungles neces-
sary in the march of progress to exterminate or civilize
such races ?

"The Philippines must be run under a despotic
though kindly form of government, supported by arms
and armor- clads, and to deal with the perplexing ques-
tions and perplexing difficulties that arise needs knowl-
edge gained by experience, by having dealt with such
problems before."

One interesting and surprising fact brought out in Mr.
Stevens' letters is the extreme fondness of the natives
for music. It appears that cheap pianos are found in
many even of the rude bungalows in and about Manila,
and the natives display no little skill and musical appre-
ciation in the use of these instruments. This at least
indicates an imaginative quality which is a hopeful sign
in any race.

But evidently this is almost the only redeeming

140

GUNTON'S MAGAZINE

feature. What our author says about the cost of living,
even in Manila, and the wages of the native servants
and laborers, indicates a general social condition that
will have to be very vigorously stirred up before even
the first movements of progress made an appearance in
the Philippine population. Mr. Stevens' valet cost him
$4.50 per month. "Where in the States," he asks,
1 ' could you rent a suburban house and lot, keep half a
dozen servants, pay your meat bill, your drink bill, and
your rent, all for less than a single dollar a day ? You
can scarcely drive a dozen blocks in a hansom, or buy a
pound of Maillard's for that money at home, and yet, in
Manila, that one coin shelters you from the weather,
ministers to the inner man, and keeps the parlor in
order.

" Our cook, for instance, gets forty cents each morn-
ing to supply our table with dinner enough for four
people, and for five cents extra he will decorate the
cloth with orchids and put peas in the soup. To think
of being able to get up a six-course dinner, including
usually a whole chicken, besides a roast, with vegetables,
salad, dessert, fruit, and coffee, for such a sum seems
ridiculous in the extreme."

Even in Manila, he says, the regular way of getting
rid of slops is to throw them into the street, and it is
necessary to hang garments high from the floor at night
to keep them from being carried off by the rats. In
some houses large snakes are kept in the attic as one
means of getting rid of the overwhelming plague of
rodents. Clearly, we have a lively time ahead in the
Philippines, if it shall prove to be the policy of the ad-
ministration to retain them and set up a permanent
colonial or territorial government there. We have them ;
there is no question about that, but it is not too late yet
to decide the question whether we shall keep them per-
manently and make them a part of the United States.

NEW BOOKS OF INTEREST

ECONOMIC AND SCIENTIFIC

Outlines of Descriptive Psychology, by George T.
Ladd, D.D., LL.D., Professor of Psychology in Yale
University. Illustrated. The Macmillan Co., New
York, $1.50. Not only profound in reasoning, but
practically and helpfully suggestive.

The Shifting and Incidence of Taxation, by Edwin R.
A. Seligman, Professor of Political Economy and
Finance in Columbia University. The Macmillan Co.,
New York. A complete revision and enlargement of
Professor Seligman's first work of this title. There is
considerable new matter on early English experience in
taxation; also on the Physiocrats, etc.

Economics, by Edward Thomas Devine, Ph.D. The
Macmillan Co., New York. 404 pp. $1.00. The au-
thor is General Secretary of the Charity Organization
Society of New York, and the book is intended both
for general reading and for class-room work in high
schools and colleges. The discussion is wholesome in
general, but not particularly vigorous on specific points.

CIVIC AND POLITICAL

Out 'of Mulberry Street; Stories of tenement life
in New York City, by Jacob A. Riis. The Century Co.,
New York. 269 pages. $1.50. A collection of epi-
sodes throwing light on characteristics of life in the
slum districts of New York.

The Government of Municipalities, by Hon. Dorman
B. Eaton. The Macmillan Co., New York. Mr. Eaton
was formerly United States Commissioner of Civil Ser-
vice, and naturally his treatment of the municipal prob-
lem is largely from the standpoint of Civil Service Re-
form.

First Lessons in Civics, by S. E. Forman, Ph. D.
American Book Co., New York. 192 pp. 60 cents. A
text-book adapted for use in upper grammar school

141

I42 GUNTON'S MAGAZINE

grades and first years in high schools. Recognizes the
need of reaching relatively young pupils with this sort
of instruction.

HISTORICAL AND DESCRIPTIVE

The Story of the Revolution, by Henry Cabot Lodge.
2 vols. Illustrated. Charles Scribner's Sons, New
York. $6.00. This is the history recently published
serially in Scribners Magazine. Although containing
little important new material, the method of treatment
is exceptionally fascinating.

Our War in Two Hemispheres, edited by Albert
Shaw, Ph.D. Review of Reviews Co., New York. 3
vols. , about i , 500 pages. This is a profusely illustrated
collection of writings by about thirty contributors, on
the history of the Spanish- American War.

The Porto Rico of To-day, by Albert Gardiner Rob-
inson. Charles Scribner's Sons. New York. $1.50.
The secondary title of this book is "Pages from a Cor-
respondent's Note Book, "indicating that the author was
a war correspondent in Porto Rico. The book describes
the people, customs, and the economic and commercial
conditions of the island; and is well provided with illus-
trations and maps.

In the Forbidden Land, by A. H. Savage Landor.
Harper & Bros., New York. 2 vols. $9.00. This is
a record of the author's now famous trip into the inte-
rior of Tibet, and his hazardous experiences in endeavor-
ing to reach the sacred city of Lhassa. Contains mate-
rial of value to scientific investigators.

Recollections of the Civil War, by Charles Anderson
Dana. Appleton & Co. , New York. 296 pages. $2.00.
This posthumous work will be welcomed quite as much
because of interest in the author's personality as in the
topic treated. It is a record of Mr. Dana's personal
experiences as war correspondent, and later as Assist-
ant Secretary of War from 1863 to 1865.

THE BEST IN CURRENT MAGAZINES

In the February Cosmopolitan, Editor John Brisben
Walker begins a series on " How an Empire was
Built"; Part I being on "Mohammed." An important
contribution is ' ' City Subways for Pipes and Wires, "
by Henry F. Bryant.

The New England Magazine for February has a
good illustrated article by Alfred S. Roe, on the his-
toric " Massachusetts State House."

James M. Scovel gives some interesting "Recol-
lections of Lincoln " in the February Lippincoti's.

In Gassier s Magazine for February James Barrow-
man writes rather optimistically on ' ' The Health Con-
ditions of Coal Mining," giving comparative statistics.

Senator Lodge begins a history of ' ' The Spanish-
American War " in the February Harper s. The usual
high standard in fiction and literature is maintained this
month by such contributors as W. D. Howells, Mar-
garet E. Sangster and Ruth McEnery Stuart.

There are two articles of special interest to socio-
logical students in The Chautauquan for February,—
"The English Poor Law and English Charities," by
by C. H. d'E. Leppington, and "Mill Operatives in
the South," by D. A. Willey.

The Panama Canal project is carefully discussed in
the February Engineering Magazine, by W. H. Hunter;
and Louis J. Magee writes on "America and Germany
as Export Competitors and Customers."

The Atlantic Monthly is running a series of attrac-
tively quaint " Reminiscences," by Julia Ward Howe;
contrasting strongly with a parallel autobiographical
series by the well-known anarchist, Prince Kropotkin.
The February number has a practical, sensible article
on "The Subtle Problems of Charity," by Jane Addams,
superintendent of Hull House settlement in Chicago.

143

INSTITUTE WORK

CLASS LECTURE
INTELLIGENT TAXATION

The problem of taxation is a very old one, and it
seems to become more difficult of treatment as society
grows in complexity. In simple society, where every-
body knows everybody else, the problem of taxation is
a comparatively easy one, because the objects for which
taxes are levied are easily understood by all, and the
simple conditions of industry and society create a com-
mon motive for the tax. With the growth of an infinite
variety of industrial, social and political interests, easy
solution of the question of taxation disappeared. The
multitude of motives that produce this difficulty are
obvious; some of which are disagreement as to the pur-
poses of collecting the taxes, and a mere selfish aver-
sion to paying for any purpose. Thus the effort to
evade taxes, especially for an object with which one
does not agree, as well as the lower motives which in-
spire people to pay only what they have to, make the
question of taxation in modern society an increasingly
difficult one.

In considering the principle of taxation, however,
it should be remembered at the outset that there are
two classes of taxes, levied for distinctly different ob-
jects. One kind is levied primarily and dominantly for
protection, the other for revenue. Of course, taxes for
protection should be levied solely with that object in
view; regardless of revenue. If protective taxes do not
protect, they are a failure. Some protective taxes may
yield revenue, others may yield none; but this is en-
tirely a secondary matter. Such taxes are a success or
failure according as they accomplish the object of pro-

144

INTELLIGENT TAXATION 145

tectibn intended. For instance, the ten per cent, tax
on the note circulation of state banks is a protective
tax. Its object is to protect the country against injuri-
ous inflation of the currency by unrestricted state bank
issues. The tax of ten per cent, made it unprofitable
for state banks to issue any circulating notes at all.
Thus it has yielded no revenue whatever, but it has
completely accomplished its protective purpose. The
tax on dogs is intended chiefly to restrict the number
of dogs. Incidentally, it yields some revenue. The
higher the tax, however, the more protective it is
against dogs and the less revenue it is likely to yield.
High license is another protective tax. It is primarily
intended to restrict the number of saloons, and has that
effect. It may increase the amount of revenue or not;
but this class of tax, whose object is not revenue but
the protection of society against some financial or social
evil, should be levied solely with reference to this pro-
tective feature, regardless of whether it yields more or
less revenue or any revenue at all.

The other kind of taxes are levied solely for the
purpose of raising public revenue. The object in levy-
ing this class of taxes, therefore, should be to obtain the
maximum amount of revenue with the minimum cost of
collection and inconvenience to society. In order to
get the maximum amount of revenue, then, taxes
should be levied in such a way as to make evasion im-
possible. In order to give the minimum amount of
cost in collection and inconvenience to the community,
they should be so levied as to involve the smallest pos-
sible amount of inquisitorial prying into the private af-
fairs of citizens, which is always objectionable and leads
to a multitude of devices for evasion, misrepresenta-
tion, perjury, and a whole list of unpatriotic and im-
moral practices.

The objection to existing methods of taxation is

i4i GUNTON'S MAGAZINE [February,

that for the most part they are arbitrary schemes de-
vised to catch special cases which seem not to contribute
their proper quota to public revenues, and are chiefly
fruitful in producing social friction and endless efforts
at evasion, resulting in relatively high cost and small
collections. Of this character are all taxes on income,
on personal property, on legacies, etc., because they are
highly inquisitorial, involving the prying into the per-
sonal affairs of individual citizens.

From what source, then, can revenues be most
equitably and economically derived. Clearly this can-
not be wages and salaries, since these incomes are the
necessary means of sustaining the social standard of
living, and consequently to impair that would be to im-
pair the social usefulness of the individual citizen. It
cannot be production, because to impair that is probably
to lessen industrial efficiency and thereby impoverish
the community. The only source from which revenues
can be drawn so as to impair neither the social useful-
ness of the citizen nor the productive efficiency of so-
ciety, is economic surplus; that is to say, the surplus
income of the community, which includes the rents,
interest and profit. This is the body of wealth which
is being created from day to day, over and above all
the expenses of production, — wages, salaries, raw ma-
terials, etc. This body of wealth in any community is
large or small according to the prosperity and progres-
sive industrial state of the community. It is the fund
from which capital is drawn for new investments and
new developments, because it can be so taken without
impairing the personal incomes upon which the standard
of living depends. It is, therefore, the source from
which public revenues can be drawn most equitably,
without impairing the economic efficiency or social
standards of the community. As a matter of fact, no
government under free institutions can collect in taxes

I899-] INTELLIGENT TAXATION 147

more than the equivalent of this aggregate surplus, be-
cause to do so would take from the wages and impair
the principle of productive investments, which would
soon cause a revolution. How, then, can taxes be
levied so as to draw the revenues from this fund of sur-
plus earnings of the community ?

There are two distinct methods of collecting public
revenues. One is by direct taxation, the other by in-
direct. It is commonly assumed that direct taxation is
the superior method, yet all experience controverts this
view. If taxes were directly levied upon the surplus
earnings of the community, from which they ought ul-
timately to be drawn, it would lead to all the devices of
evasion and opposition that accompany the income tax
and personal property tax. To levy taxes directly upon
rent or profits or interest enlists the antagonism of the
entire rent-collecting and profit-receiving class, to the
tax collector and to the public improvements for which
the taxes are expended; it also leads to unlimited in-
ventions of misrepresentation for the purposes of
evasion. This method of collection, therefore, necessar-
ily involves making the tax collector the most objec-
tionable inquisitor imaginable.

The psychological effect of the attempt to levy
taxes directly upon surplus earnings would be a real
stultification of industry. If profits, for instance, were
to be taxed directly in proportion to their amount, the
effect would obviously be to discourage efforts at profit-
making, since it would only be creating a fund for the
tax gatherer. Direct taxation, in fact, is the poorest
of all methods of collecting public revenues, because it
necessarily creates the maximum amount of antagonism,
resistance and evasion.

Indirect taxation, then, is the only feasible way for a
complex community to raise revenue for public expendi-
ture. As a matter of fact, almost everything in society is

148

GUNTON'S MAGAZINE

[February,

done better and cheaper which is done indirectly. Pro-
ductive force is much more effective when applied in-
directly through the medium of complex machinery
than when applied directly by hand labor. The best
judgment in the community on great problems of
state can usually be ascertained by indirection of voting,
through the various stages of political organization, as
the caucus, local and state party conventions, and ulti-
mately the legislature. Public opinion is developed, sift-
ed and matured by a process of indirection, through the
press and selected representatives. This is true of nearly
all forces operating in society. The very process of in-
direction tends to eliminate the crudities, reject the ob-
vious defects, and ultimately afford the greatest opportu-
nity for criticism, and the application of the best repre-
sentative intelligence.

What is thus true of the forces of production and
government is equally true of the collection of public
revenues. How, it may be asked, can we be sure that
taxes levied indirectly will ultimately come out of the
surplus earnings ? This is a question of the mobility
of taxes, which is least of all understood in connection
with the problem of taxation. Wherever taxes are
levied, we may be sure that they will be shifted as long
as shifting is possible. For the same reason that people
dislike to pay more than they have to, they will always
transfer the payment to others of whatever they can
In order to make taxes invisible, and their movement
as insensible as possible, it is necessary to levy them
at the point farthest from ultimate payment; in other
words, to levy them on the sources of production rather
than on the finished products, so that in the shifting they
will be spread over the entire product, and be sifted into
all the crevices of profits throughout the community.

The point of levying taxes, therefore, with the
maximum indirection, is at the source of production, or

i899.] INTELLIGENT TAXATION 149

on land and other real estate. There is only one way
by which taxes can be shifted, and that is through the
price of something that is sold. A tax on land would
immediately be transferred to the price of the crop,
and this because it is a part of the cost of producing
the crop, just as much as that which is paid for labor,
seed, implements or improvements. If, for instance, it
was on wheat, it would be transferred to the miller,
and the miller would shift it to the jobber, who would
see that it passed on to the grocer, who would not in
the least neglect to charge it up to the consumer.
Where will it stop ? is the question. It will stop at the
place where the thing is not re-sold. It is commonly
assumed that for this reason the consumer cannot
transfer it. If the consumer is a person who lives on
profits or rents, or other surplus income, he cannot
transfer it, because he sells nothing on to the price of
which he can put it. But, to the extent that the con-
sumers are wage or salary receivers, they can transfer
it, because they sell something into the price of which
it enters, viz: their labor. The price of flour or cloth-
ing, or of whatever enters into the cost of living, not
only can be but is put on to the cost of labor. If the
price of commodities should rise, wages would rise.
That is the experience of the world. Witness the
movement of prices and wages during the civil war.
When the money was depreciated, prices rose, and
when prices rose wages necessarily followed, and this
because of the simple fact that the standard of living is
the real force by which stipulated incomes, as salaries
and wages, are ultimately determined. So that, in
reality, a tax that is levied at the source of production
and has traveled through the community is paid by the
consumer whenever the consumer lives on profits, be-
cause he has no means of shifting it; but so far as the
consumers are wage and salary receivers (that is, live

i5o GUN TON'S MAGAZINE [February,

on stipulated earnings) they have the same means of
transferring it to the employers that the farmer had to
the miller and the miller to the shop-keeper and the
shop-keeper to the consumer. When it has reached
the employer it has reached the end of the circle and
the struggle for its final resting-place begins.

It may be asked, will not the employer re-transfer it
to the price of his products, just as the farmer did in the
first instance, or any of the intermediaries? No. The
process is not the same. The resistance is greater, and
in fact the conditions are altogether different. When
the price of sugar is increased by a cent-a-pound duty,
it is increased universally, all over the country at once,
and it is taken for granted by all who buy and sell and
use sugar that the duty must be added to the price, and
sugar will rise. In the case of the laborer transferring
the added cost of his living to the employer, it does not
come in any such universal or uniform manner. Indeed,
it comes very gradually and only in small spots at a
time. The laborer endeavors to transfer the tax, or in-
creased cost, to the employer through the demand for
higher wages, but he does so only after considerable in-
convenience, through pressure of inability to maintain
his usual standard of living, — in short, by his inability to
pay his bills without sacrificing some of the comforts or
luxuries he has hitherto enjoyed. If this came among
all laborers at once and in a uniform quantity, the em-
ployers might uniformly resist it or uniformly try to re-
transfer it on to the product; but since it comes piece-
meal, it reaches individual employers or concerns separ-
ately, first one shoe factory, then the general shoe in-
dustry. At another time it may be the carpenters in
one city, then in another, then in another, and so on.
This rise of wages is definitely a transfer of the em-
ployers' profits to the laborers for the time being.
They cannot permanently resist the rise of wages.

1899.] INTELLIGENT TAXATION 151

To this extent the tax has come right out of the
profits. If the employers attempt to transfer this rise
of wages, which is in reality the tax that has been
transferred, they come immediately in competition with
their own class in their particular group of industry.
In times of normal prosperity in progressive society,
there are some who have large margins of profit, while
others are near the no-profit point. Those who have
large profits, like the Carnegies in the steel industry,
when this pressure and contest comes, can afford the
slight rise in wages without even attempting to put up
the price of the product; while those who are making
no profit, or only a very slight profit, will have their
margin wiped out entirely. The contest begins for sur-
vival among the employers, and those who were at the
no-profit point, in order to remain in business, have to
re-organize their business on a more economic basis,
adopt better methods, call in science and invention, or
in some way create a new margin by economic devices.
Cotton cloth, for instance, has been reduced in price
from fifty to four cents a yard by exactly that process;
the pressure upon profits compelling the introduction of
cost-reducing devices which permitted the selling of the
product at a lower price and still leaving a margin of
profit. When this result comes, in the case of taxation,
nobody is the poorer and the community is the richer.

Thus it is that indirect taxes are most equitable,
most uniformly distributed throughout the community,
least offensive in collection, and are ultimately paid out
of the profits of the community; until the profit-receiv-
ers re-imburse themselves from nature by the use of
new methods, which is always an addition to industrial
progress and social welfare.

WORK FOR FEBRUARY

OUTLINE OF STUDY

This month we are to consider the subject of taxa-
tion. The curriculum topic is Number VI, as follows:
VI. THEORY AND PRACTICE OF TAXATION.
a Tariff taxes.

b How and when they affect prices, and when not.
c Direct and indirect taxes.
d Personal property tax.
e Income and legacy taxes.
f Influence of taxes upon wages.

REQUIRED READING

In " Principles of Social Economics," Chapter IV
of Part IV. In GUNTON'S MAGAZINE for February, the
class lecture on "Intelligent Taxation;" also the Notes
on Required and Suggested Readings.

SUGGESTED READING* -
In Seligman's "Essays in Taxation," Chapters I,

II, IV and V. In Adam Smith's "Wealth of Nations,"
Chapter II of Book V. In Ricardo's "Principles of
Political Economy and Taxation," Chapters VIII to
XVII inclusive. In Burgess* "Political Science and
Constitutional Law," Section 9 of Chapter VII and
Section 8 of Chapter VIII, both in Division II of Book

III. Lecture on " Ethics of Taxation " in GUNTON IN-

* See Notes on Suggested Reading, for statement of what these
references cover. Books here suggested, if not available in local or
traveling libraries, may be obtained of publishers as follows :

Essays in Taxation, by E. R. A. Seligman, Ph.D. The Mac-
millan Co. , New York. 434pp. $3.00. The Wealth of Nations, by
Adam Smith. G. P. Putnam's Sons, New York. 780 pp. $i.«5. The
Principles of Political Economy and Taxation, by David Ricardo. In
complete works of Ricardo, published by Chas. Scribner's Sons, New
York. $6.40. Political Science and Constitutional Law, by John W.
Burgess, Ph.D., LL.D. Ginn & Co., Boston. 1891. 2 vols. 337-404
pp. $5.00. Reports on Taxation in Foreign Countries', in U.S. Con-
sular Reports Nos. 99 and 100. (Nov. and Dec., 1888.) Can be found,
probably, in local libraries.

152

WORK FOR FEBRUARY 153

STITUTE BULLETIN No. 12 (Vol. I); lecture on 4 'Taxa-
tion versus Confiscation " in Bulletin No. 13 (Vol. I).
Also see Taxation Reports, in U. S. Consular Reports,
Nos. 99 and 100, 1888.

NOTES AND SUGGESTIONS

Required Reading. — To most people taxation is a
perplexing topic, not because they have any difficulty
in recognizing the tax collector when he comes around,
but because our tax systems are so confused and ap-
parently unequal, and because almost nobody has any
clear idea of how a just and scientific system can be
devised. The trouble comes, as in most cases of the
sort, from lack of a general principle on the subject.
Once let us get a clear understanding of how taxes are
shifted, throughout the community, and by whom they
are finally paid, and we are in a position to see what
general principles should govern in laying taxes so that
they shall be least burdensome and most just.

It is with this object in view that Professor Gun-
ton discusses the subject in the chapter assigned this
month. He first goes over the different theories that
have been held as to the just basis of taxation, — whether
it should be in proportion to the benefit received or to
the citizen's ability to pay the taxes. The first theory
defeats itself at the outset, because the very class that
most needs the protection and help of the state is least
able to pay taxes. Following out the other theory, that of
ability, he reaches the conclusion that the best system
is that which does not involve taking the tax out of the
necessary cost of living of any class in the community,
but draws it from the surplus wealth that is being con-
stantly created nTthe form of rent, interest and profits.

To place the tax directly upon any one of these
forms of income, however, is a most difficult and ob-
noxious matter. It necessitates inquisition into what
everybody looks upon as strictly personal and private

154 GUNTON'S MAGAZINE [February,

affairs. Therefore it arouses the greatest amount of op-
position to the taxation. When we come to look upon
taxation, moreover, as merely another form of consump-
tion, and therefore as actually beneficial to the extent
that it is spent upon wholesome and necessary public
improvements and services, it becomes important that
the community should not be continuously in arms
against this mode of expenditure, regarding it as an un-
mitigated evil.

Of course, no defence is to be offered for taxes that
are misapplied or stolen ; and the amount that is spent
merely in the official administration of public affairs
should be kept down to the lowest point of efficient ser-
vice. But the portion that actually goes into public
education, or sanitation, or adequate police protection,
or administration of justice, or cleaning of streets, or
good roads, or good water supply, is a benefit to the
entire community, and each individual's share of this
benefit is generally many times greater than anything
he could have obtained for himself personally by spend-
ing the relatively small amount he has contributed to
the public funds.

Two points, therefore, are clear. First, we want
to draw the taxation from the surplus revenues of the
business community, and, second, do it in such a way
as to permit necessary and reasonable public improve-
ments to go on without being crippled by violent oppo-
sition on the part of the public. How to do this is the
vital problem considered in this chapter, and the solu-
tion is found by analyzing the problem of how taxes are
shifted. As a general principle it is found to be true
that taxes falling upon anything that is regularly bought
and sold are transferred from the seller to the buyer.
Thus, taxes on land enter into the cost of producing
raw materials, and thus are carried along through all
the subsequent forms of manufacture, finally reaching

i899-] WORK FOR FEBRUARY 155

the consumer of the finished product; and such of the
consumers as are wage earners eventually transfer the
tax to their employers, in the form of higher wages.
Here the process ends, for the reason that these wage
increases reach the different employers at different
times, and no one of them is alone able to raise the
price of the commodity so long as his competitors are
unaffected by a similar demand for increased wages.
In the case of the first going around of the tax, however,
it starts with all the producers at once, and hence be-
comes an essential and necessary part of the cost which
goes to make up the price of each specific product.
Those who were already selling at the cost point are
still needed to supply a portion of the market demand,
and hence the price must rise to cover this new tax ex-
pense. This point is further elaborated in the class
lecture published in this number.

Thus, in the long run the normal, regular taxation
in the community comes out of the profits of capital.
A real evil is encountered, however, when the systems
or modes of taxation are violently changed year after
year. In that case the shifting process does not have
time to work around and transfer the tax on to surplus
wealth before the system is changed, and thus it is
paid at some of the intermediate points. This is chief-
ly true with reference to wages. The effect of taxes
levied at the source of production is to increase the
cost of the necessaries of life, but it is some little time
before this makes itself generally felt among the la-
boring class as an actual restriction in their standard of
living, and thus for a time the laborer does actually
lose by virtue of this taxation. If the tax is continued
as a regular thing, the final effect is a compensating
rise in wages; but if the tax is removed before the la-
borers' demands have become sufficiently unified and
strong, the rise does not come, on that account at least,

1 56 GUNTON'S MAGAZINE [February,

and they lose whatever they have been paying out in
the higher prices. It thus becomes a matter of great
importance that the tax system should be as uniform
and invariable as possible, and we ought steadily to
approach the point of levying taxes in the same way
and according to the same general principle.

In the class lecture the effect of tariff taxes upon
prices is discussed, and it is shown that the same gen-
eral process of shifting holds good here. It should al-
ways be remembered, however, in reference to all forms
of taxation, that the employer does not necessarily per-
manently lose by having to pay the tax in the end.
The pressure upon his profits is the incentive to new
economies in production, and the use of better methods-
whereby he may keep up the profitableness of his
business. This means that in the long run the taxes
come out of nature, in the form of increased production
of wealth.

Suggested Reading. — For a discussion of all the various
forms of taxation imposed both in ancient and modern
communities, as well as the theories upon which these
systems have been based, we know of nothing more
comprehensive than Professor Seligman's "Essays in
Taxation." The first chapter suggested in this book
deals with the historical development of various forms
of taxation, from primitive society down to the present.
The next discusses the general property tax, based on
the theory of ability, but radically defective in practice
because of the extreme difficulty of collecting taxes
on personal property. Chapter III deals with the single
tax, and this we have omitted, because it is a subject
discussed in next year's course on social economics.
Chapter IV treats of the problem of double taxation,—
that is, taxes on both real property and mortgages up-
on the same, or on corporation property and the corpor-
ate shares representing such property. This is simply

WORK FOR FEBRUARY 157

one more of the difficulties attending personal property
taxes. The fifth chapter treats of the inheritance tax,
and Professor Seligman inclines rather favorably to this
form as an additional way of applying the principle of
( 'ability" in the levying of taxes. The importance of
this sort of direct taxation, however, is greatly dimin-
ished in the light of the fact that all taxes eventually
come out of the surplus wealth of the community.

In none of these chapters does Professor Seligman
do much in the way of suggesting remedies for the de-
fects he points out in the various systems. The chief
value of his work, perhaps, lies in the clear exposition
of tax systems as they are, and of their many shortcom-
ings. Those desiring to make a more complete study
of the subject would do well to read the entire vol-
ume. The subsequent chapters discuss at length the
taxation of corporations, different kinds of public reven-
ues, recent reforms in taxation, etc.

The important feature in the reading suggested in
Adam Smith and Ricardo is their emphatic assertion of
the law that taxes on wages, or on commodities con-
sumed by laborers, have the effect of raising wages.
The laborers transfer the tax to their employers. There is
an important difference between Smith and Ricardo,
however, as to the final payment of the tax. Smith
asserts that the employer charges the increased wages
upon the price of his product, and thus that the consum-
ers and landlords finally pay the tax. Ricardo, on the
contrary, correctly maintains that the employer cannot
add the increased wages to the price of his goods; he
must pay the tax, represented in this wage increase,
out of his profits. The point Ricardo fails to make,
however, is that this very pressure on profits stimulates
the employer to introduce new economies and im-
provements in production, so that the tax is finally com-
pensated for by increased production of wealth. Per-

i58 GUNTON'S MAGAZINE [February,.

haps it is only natural that this fact did not strongly
impress itself upon Ricardo, since in his day the field
of machinery and capitalistic organization was still very
narrow and its possibilities little anticipated.

Smith and Ricardo agree that a tax on economic
rent cannot be shifted, because it is laid on surplus
revenue; it falls on the landlord. Neither, however,
could see that the same principle applies to profit,
which is simply another form of surplus revenue. The
difficulty with such taxes lies, not in the danger that
they will be shifted on to the consumers, but in the ex-
treme obnoxiousness of the direct personal tax, the ease
of evasion, and the popular hostility to public improve-
ments which this inquisitorial method of taxation be-
gets. These are the reasons why it is better to let the
tax come around by an indirect process; eventually it
is paid out of surplus wealth, and far more certainly
and economically than if it were directly levied on such
wealth in the first place.

The sections suggested in Burgess are not specially
significant, but they state briefly the powers of taxation
conferred by the constitutions of the United States and
Germany upon the national legislatures of those coun-
tries. Consular Reports Nos. 99 and 100 (1888) give
the then existing tax laws of nearly all foreign coun-
tries.

LOCAL CENTER WORK

Last month's topic, Protection and Free Trade, is
so closely interwoven with our study of taxation this
month, that the two can be merged to a large extent in
the work of local centers. We make the following
suggestions :

Address on Protection versus Free Trade, by local
lecturer or public man. Debates on: Resolved, That
the general property tax is impracticable and unjust;
Resolved, That tariff taxes are finally paid by the con-

i899-] WORK FOR PEBRUARY 159

sumer; Resolved, That all taxation should be levied di-
rectly on incomes; Resolved, That reasonable taxation,
wisely expended, is a public benefit and increases the
wealth and well-being of the community; Resolved,
That the laborers most of all are interested in a policy
of public improvements, and should not be misled by
appeals against taxation.

Also, some member might be appointed to conduct
a quiz on the month's work, or even on the whole sub-
ject up to date. There might be papers and discus-
sions on such topics as: Ultimate effects of tariff
taxes; Revenue and protective taxes; Direct or indi-
rect taxation — which is better? Public expenditures,—
the kind to encourage and the kind to restrict ; How to
avoid personal tax-dodging; How the custom of taxa-
tion developed ; What are income and legacy taxes ?
Should taxes be uniform or progressive in rate? Should
taxes be levied to confiscate wealth, or to support the
government and make public improvements?

QUESTION Box

The questions intended for this department must be accompanied by
the full name and address of the writer. This is not required for publica-
tion, but as an evidence of good faith. Anonymous correspondents will
be ignored.

Editor GUNTON'S MAGAZINE : In one of your re-
cent lectures you said that the State has absolute right
or authority over the individual in all matters. Is not
this a case of might making right ? For instance, if the
State exercises arbitrary authority over individuals on
all matters, does it not do so merely because it has the
power to do so, but often in violation of the real rights
of the individuals ?

N.W.I., New York City.

Of course it is true that the State exercises its author-
ity, however arbitrary, because it has the power to do
so, but besides having the power to do so it has the only

!6o GUNTON'S MAGAZINE

right there is to do so. Its right consists in the fact
that whether in the abstract it is wise or unwise, its
action is the action of the best obtainable consensus of
the community, which is the highest source of author-
ity. I did not say that the State was always right in the
sense of being wise, or even humane, but that it al-
ways has the right to act. There is a great difference
between these two things. We may differ, intelligent
people do differ, as to the legal and economic wisdom
of the decision of the Supreme Court on the constitu-
tionality of the income tax; but with our form of gov-
ernment nobody doubts either the wisdom or the right
of the Supreme Court to have the final word, and it has
the final word because it is the best devised obtainable
consensus of legal wisdom. If the decision of the Su-
preme Court of the United States is not to be final, shall
some lower court be final, and if so, which of the lower
ones, — the bottom local magistrate ? There is no stop-
ping place for final appeal between the top and the bot-
tom. That which is at the top as representing the most
competent consensus has, ought to have and must have
the power of final decision in all matters of law.

I repeat, we must not make the mistake of con-
founding the right to act with acting rightly. They
are not the same. The state has the absolute right to
act. It is for the people to see that it acts wisely, and
that must depend upon the education and intelligence
of the citizens in questions of public policy.

GUNTON'S MAGAZINE

VOL. XVI MARCH, 1899 No. 3

ECONOMICS AND PUBLIC AFFAIRS

Frontispiece .... fean Baptiste Say

The Era of Trusts 161

The Menace of Immigration ..... 166
Labor Laws in the United States . . . . 171
Distinguished Economists: IX — Say . . 180

dltorial Crucible: American locomotives for China —
Fulfillment of labor pledges — The Inter-Ocean and
Speaker Reed — Socialistic labor-union program — The
standard of living — Tom L. Johnson and single tax . 182

Events Worth Noting . . . . 18?

Civics AND EDUCATION

Municipal Socialism ....... 190

Civic and Educational Notes: How to utilize abandoned

city churches — Indian education . . . . ig8

SCIENCE AND INDUSTRY

The Ethics of Ticket Scalping 200

Science and Industry Notes: Electricity in agriculture

—Growth of electric railways — How to help agriculture . 211

CURRENT LITERATURE

'• The Standard of Life " , 214

Additional Reviews : Poems by Richard Rcalf—The

Philippine Islands and their People . . 2l8

New Books of Interest ... . . . . . 22O

The Best in Current Magazines . . 223

GUNTON INSTITUTE WORK

Common Sense on Money — (Class Lecture) . . 224

Work for March

Outline of Study ..... 234.

Required Reading . . ., . . 2Q4.

Suggested Reading . . . . . . 234

Notes and Suggestions . . .- . 2^6

Local Center Work . . . „ ; 230

Question Box . . , . „ . 24.O

Copyrighted^

JEANJ BAPTISTE SAY

GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

THE ERA OF TRUSTS

It is manifest, even to casual observers, that we are
entering upon an industrial era of trusts. Within a
year, and especially during the last six months, the ten-
dency towards re-organization and consolidation of a
number of smaller industries into large ones has
amounted almost to a stampede. Nothing like it was
ever known before since the origin of the factory sys-
tem. If this movement continues during the present
year at anything like the rate it has been going the last
six months, the leading industries of this country will
have taken on the trust form of organization. Whether
this movement will be permanent or will arouse public
opposition which will bring its defeat through legisla-
tive restriction, will depend almost entirely upon the
wisdom of the capitalists themselves.

The movement itself is an entirely natural one and
is wholly in line with economic progress, provided it is
not uneconomically directed. If these re-organizations
are conducted on sound business principles, as in the
adoption of new machinery, vis: to create profits by the
introduction of economies in administration and sharing
these profits with the community through a reasonable
lowering of prices, there will be no serious danger of polit-
ical molestation. But if the re-organization becomes a
speculative game to take advantage of an industrial sen-
timent for the purpose of monopolizing certain lines of
industry and ' 'gouging" the public by putting up prices,
to pay dividends on abnormal capitalization for pro-
moters' bonuses, a social opposition which will take on

161

T62 GUNTON'S MAGAZINE [March,

a political form is pretty certain to arise. There is al-
ready an antagonism to trusts, from sheer economic
prejudice, largely born of socialistic antagonism to cap-
ital and partly stimulated by popular aversion to the
new; but, on the whole, thus far trusts have been fairly
economic in their policy. In a few instances they
have departed from business principles and tried to
establish uneconomic monopolies, and in every such
instance they have come to grief. But this unwholesome
effort has created an unfavorable impression in the
public mind. All the trusts and large concentrations which
have become permanently established have contributed
very largely to the improvement of the products
they furnish, and greatly reduced the price.

It is characteristic of all these large concerns, which
have followed sound business principles and shared
their profits with the public by reducing the cost of the
product, that they are in the long run the most success-
ful establishments. Moreover, these concerns are rapid-
ly outgrowing public antagonism. The Standard Oil
Company, for instance, which was once very unpopular
and has been the subject of much hostile legislation, is
rapidly coming to be recognized as a legitimate con-
cern, making its profits out of economic improvements,
and properly conducted; and it is moreover being gen-
erally recognized that this concern, which is the largest
and oldest of the trust form, has for twenty years stead-
ily improved the quality and lowered the price of illu-
minating oil and by-products associated with that in-
dustry.

A number of the industries now going through the
process of re-organization are following the speculative,
monopolistic rather than the economic method of pro-
cedure. They are using the concentration of the indus-
try as a means not only to lessen the expense of produc-
tion but also to put up the price of the product to the

I899-] THE ERA OF TRUSTS 165

community. Now, this is not merely uneconomic but
it is against the public welfare and will not long be tol-
erated— and it should not. The result of this policy, if
it is pursued, will be to array the public through the
legislatures against the trust movement altogether, and
thus work great injury to the community in general.

With the return of prosperity the universal impulse
is again to make profits. Confidence has everywhere
been revived. The demand for goods is rapidly in-
creasing. New investments to supply anticipated de-
mands are being freely made. In short, all the signs
point to another era of prosperity. But the people have
become accustomed to the low prices established during
the era of depression, and it is more than probable that
any attempt to re-establish former profits by re-inaugu-
rating former prices would greatly check, if it did not
destroy, the present business boom. Profits once lost
by falling prices, except under the sudden pressure of
war or depreciated currency, can never be permanently
re-established by raising prices, but must necessarily
come through n£w_£mfit-c£eating methods, either in
the form of improved machinery oFmore economic type
of organization. Though not much understood, this,
fact is universally felt throughout the industrial world.

It is true throughout society that every class or
group has to suffer for the sins of its most injudicious
or hot-headed members. Trade unionists as a class
labor under suspicion and distrust, and encounter
considerable open opposition, because of the foolish
and ignorant acts of a few hot-headed leaders who be-
come conspicuous at the moment of a strike. So it is
with capitalists. A few mean, unreasoning, and perhaps
unthinking capitalists, who are only up to the level of
making business a grand game of grab, bring discredit
in the popular mind upon the whole employing class.
Laborers and their sympathisers in the community f ol-

x64 GUNTON'S MAGAZINE [March,

low the same rule that employers do toward labor unions,
and judge the whole class by their worst specimens.

This is true of the public attitude towards all new
movements, and the present trust movement will be no
exception. If a few concerns are unfortunate enough
to be under a leadership sufficiently short-sighted to
take advantage of the temporary opportunity the new
organization affords to tax the public by increased
prices, there is sure to be a vigorous crusade against the
new movement. It will not be confined to the few
indiscreet concerns that have not learned to recognize
the highest business success, but it will be directed
against capital and large organizations in general.

The tin-plate trust is one of these offensive examples.
This is an industry which practically could not have
existed in this country but for the legislative aid of the
public. Until the tariff — a very high one at first — was
placed upon foreign tin, the tin-plate industry had no
existence in the United States. It has been born and
nurtured by the protective aid the public has given it.
Its very existence is due to the good will and political
good sense of the United States. The tin-plate trust is
one of the " fool examples " of using the trust organiza-
tion to put up the price. Of course it would be unwise for
the public to hamper a really helpful industrial movement
because speculative ' 'grabbers" get temporary posses-
sion ; nor should a few mistakes of this kind be permitted
to be used effectively against the protective tariff as a
general policy. Nevertheless it would be perfectly safe
and the part of good policy for Congress to pass a law em-
powering and instructing the Secretary of the Treasury
to withdraw the protective duty from all products the
prices of which are raised by trust organizations. In
short, the moment a trust organization raises the price of
a product enjoying any degree of protective duty, it
should thenceforth be put upon the free list and become

1 899.] THE ERA OF TRUSTS 165

subject at once to world competition. If the or-
ganizers of trusts in any line have not economic
sense and public spirit enough to refrain from using
their concentrated power to tax the public by
increasing prices, the public shoiild at once with-
draw any protective advantage it has given to that in-
dustry. The primary object of protection is to make
it possible to stimulate the development of domestic in-
dustries; but when industries have become established
and proceed to take advantage of this protection for
monopolistic, price-raising purposes, they should at
once be thrown on their own competitive resources.
This would be in harmony with strictly economic policy,
and might have a wholesome effect upon the movement
of trust re-organization.

We should utilize the coming period of prosperity
to give to capital liberal profits, to laborers higher
wages, and to the~^uWic~BetteF^nd^cheaper goods. If
the benefits of the trust era are thus distributed it will
be an era of permanent advance in public welfare and
social harmony as well as in economic organization.

THE MENACE OF IMMIGRATION

One of the chief objections urged by the opponents
of protective tariffs is that they are in the interest of
capital and not of labor. While this statement is not
correct, and protection to domestic industries does bring
with it a benefit to the laborers as well as to the capital-
ists, it is true that the employing class and the pro-
tectionist party is much more eager to legislate restrict-
ing the importation of cheap labor products than to
restrict the influx of cheap laborers. Thus, when the
McKinley administration came into power, its very first
act was to pass a new protective tariff law. Within ten
days after the President's inauguration a special session
of Congress was called for the purpose of enacting a
new tariff law, and in four months the now historic
Dingley Law was enacted.

A bill was introduced to apply the same principle
of protection directly to the laborers, in the form of
restricting immigration. Last year this bill, known as
the Lodge Bill, passed the Senate, but is " hung up " in
the House and now will in all probability remain pigeon-
holed until the new Congress meets, and perhaps then
be again doomed to procrastination and postponement.
Protectionists in general, and the Republican party in
particular, have no right to complain if the workingmen
interpret this as an " unfriendly act. " If they really
believe in protection as a principle, and if they really
advocate protection primarily in the interest of labor,
their attitude towards measures specially designed to
afford protection directly to laborers, like the immigra-
tion restriction bill, certainly needs explanation. No
amount of ante-election eloquence or post-election ex-
planation will much longer be accepted by the working-
men for the party's attitude on this subject.

Free traders may properly be expected to oppose

166

THE MENACE OF IMMIGRATION 167

restriction of immigration. They do not believe in
restriction at all. But the Republicans pretend to be-
lieve in protection, and especially in protection to labor.
Protectionists pose everywhere as the enemies of cheap
labor, as the friends of high wages. They accordingly,
and properly, impose protective duties in order to secure
the opportunities of the American market to American
manufacturers. Then why not show the same eager-
ness and interest in securing the opportunities of the
American labor market to American laborers? If they
are really opposed to cheap labor, they surely ought to
support the policy which shall restrict the influx of the
cheapest, most benighted and poverty-steeped laborers
industrial life in Europe produces.

During the last few years American labor has not
suffered much from immigration. The policy of the
last administration was quite as effective in restricting
immigration as any statute law could be. There was,
indeed, a short time during Mr. Cleveland's second term
when the gates of Castle Garden swung outward, and
the tide of immigration was more than overbalanced by
the tide of emigration. But a new era of prosperity
has set in. The wheels of industry have begun to turn
with increasing speed. Industrial expectations are ex-
cited to a high pitch; all the signs point not only to a
return of prosperity but to a lengthened period of busi-
ness growth and expansion.

In the coming period of prosperity, capitalists will
be capitalists. They will seek to survive in the
struggle for profits and supremacy by having recourse
to any available means which will enable them to under-
sell. A part of this movement will be to resist the de-
mand of the laborers for shorter hours, better conditions
or higher wages, all of which demands mean, temporar-
ily at least, some increased pressure upon the employ-
ers' profits and competitive ability. If they are enabled

i68 GUN TON'S MAGAZINE [March,

to refuse these natural demands of American labor by
drawing unlimitedly upon the cheap labor of Europe,
they may be relied upon to do it. It is not that
employers desire to injure the laborers, but in the
normal competitive effort to hold their own in the* market
they will use whatever available forces will aid that end.

If the American capitalists are going to acquire
more wealth, as they should, they ought be compelled
to do so by the employment of American labor. If for
the next ten years protective legislation interposed as
effective a barrier to the immigration of cheap labor
as the tariff does to the importation of cheap products,
the first decade of the twentieth century would consti-
tute a new era for American labor. It would do more
to solve the economic and social problems which are
threatening political disruption than all the legislation
against trusts and combines could do in a century.
Moreover, in asking this the workingmen are asking
nothing unreasonable. They are asking only that the
established policy of the nation towards employers
should be extended to laborers.

A special reason for adopting such a measure is
that immigration has undergone a great change in
the character of immigrants. They are con;ing in in-
creasing proportion from the poorest wage-paying coun-
tries. For instance, in the decade i86i-'7O, Austria-
Hungary, Russia, Poland and Italy furnished only 1.05
per cent, of the total immigration, while Great Britain,
Germany and Scandinavia furnished 82. 10 per cent, of
the total immigrants coming to this country. In the
decade iS/i-'So, Austria-Hungary, Russia, Poland and
Italy furnished 6.44 per cent., and the number from
Great Britain, Germany and Scandinavia fell to 64.97
per cent. In i88i-'9o, Austria- Hungary, Russia, Po-
land and Italy furnished 17.65 per cent., and Great
Britain, Germany and Scandinavia only 63.38 per cent. ;

1899.] THE MENACE OF IMMIGRATION 169

while in 1898 the immigration from Austria- Hungary,
Russia, Poland and Italy rose to 57 per cent, of the
total, and Great Britain, Germany, Scandinavia and
France furnished only 33 per cent. Thus, during the
last decade the proportion of immigration from these
poorest countries has increased over 200 per cent. ;
while, during the same period, immigration from the
most advanced countries has fallen off nearly 50 per cent.

The character of the immigrants is also indicated
by the fact that, taken all together, the average amount
of money possessed by the 229,299 immigrants in 1898
was only $17.00 each. Remembering that the English
and German immigrants would have on an average
probably twice that amount, a very large proportion of
them were evidently almost penniless. In 1897, 39
per cent, of the immigrants (we have not the facts
for 1898) had no occupation — were practically vagrants,
and 23 per cent, of the total number over fifteen years
of age were illiterates, not being able either to read or
write. Most of these also were included in the 57 per
cent, coming from Austria- Hungary, Italy, Poland and
Russia. Practically none of the German and very few
of the English immigrants are now entirely illiterate.

The effect of this quality of immigration upon the
condition of American labor has already been keenly
felt. The Bureau of Statistics of Labor in New York
State investigated the subject in 1898, and the results
are given in the report, advance sheets of which are
just out. According to this report, 265 labor or-
ganizations, constituting 25.5 per cent, of the whole
number making returns, and representing 70,000 mem-
bers (39.8 per cent, of the whole) stated that they were
injuriously affected by the competition of immigrant
labor. In six years, it is reported by 1 54 organizations,
17,322 trades union laborers were displaced by immi-
grants. Ninety-seven unions, having a membership of

i7o GUNTON'S MAGAZINE

22,318, report that the term of employment of their
members was materially lessened, with a resultant de-
crease of wage earnings; 120 unions, representing
34,304 members, report that their wage rates were re-
duced by the competition of newcomers; while 137
unions, with a membership of 34,482, report that immi-
gration had no effect on union rates. Thus, about half
the members of the trades unions were, by this esti-
mate, injuriously affected by immigrant labor.

In the building industry alone, the largest part of
which of course is in New York City, 1 1 3 organizations,
with a membership of 27,862, engaged in 17 out of 26
trades, reported displacement of union men by immi-
grant laborers; 74 of these unions report that 9,815
members were displaced by immigrants; 34 organiza-
tions, with a membership of 6,832, report curtailed em-
ployment and reduced earnings; 33 unions, with 4,760
members, report reduced wage rates owing to immi-
grant competition.

The facts given in this report are elaborate and
convincing, showing not in a general way merely but
in thousands of specific instances in New York City and
State, that American trade union laborers have been
displaced, others had their working time curtailed, and
a large number their wages reduced, through the dete-
riorating influence of immigration. The evidence is
abundant and conclusive that against this inimical inflow
of foreign poverty American laborers have a social and
moral as well as industrial and political right to be pro-
tected. If the Republican party, which is now in a
clear majority in both houses of Congress, refuses this
legislation for the wage earners of the United States, it
can hardly expect their confidence and political support.
Its attitude on this question may very properly be made
the test of its interest and of the sincerity of its procla-
mations in favor of American labor.

LABOR LAWS IN THE UNITED STATES

Most people are unaware of the number and variety
of laws that have been passed in this count: y in behalf
of labor. Hardly a state in the North and West at
least has failed to do something1 in the way of restrict-
ing the hours of labor of women and minors, prohibit-
ing child labor, requiring wholesome factory conditions,
and the like. The commonly accepted idea is that our
legislation is largely controlled by, if not directly for
the benefit of, corporations and trusts. How wide this
is of the truth is seen by an even cursory examination
of the statute books throughout the country during the
last dozen or fifteen years. Generally there are a dozen
laws against capital to one in its favor, while the laws
directly intended to benefit labor interests are more
numerous than measures of any other single class.

It is very true that not all of these laws are properly
enforced. Some of the factory inspection and sweat-
shop laws, for instance, are hardly enforced at all in the
way intended, for lack of proper means, and sufficient
energy in the executive departments. Nevertheless, it
is a distinct sign of progress that public sentiment has
been sufficiently aroused to secure the passage of so
many wholesome measures for the protection of labor,
and, if they are not adequately carried out, it is chiefly
because the people themselves do not take pains enough
to show to the executive officers that public sentiment
will back them up in a vigorous policy of enforcement.

It has seemed to us a matter of considerable inter-
est to know exactly what laws do now exist in various
states with reference at least to hours of labor and em-
ployment of children. We have therefore made a
thorough examination of the reports of the United
States Department of Labor on these points, and are
able to give herewith the facts down to November, 1898.

171

i72 GUNTON'S MAGAZINE [March,

First, with reference to hours of labor. There are
three general classes of laws that have been enacted on
this subject. There have been laws restricting the
hours of labor on public works, state or municipal; laws
defining a legal day's work, unless otherwise contracted,,
and laws definitely limiting the hours of labor in factories,
mercantile establishments, etc. , to a certain number per
day or week. These latter laws, for constitutional
reasons, have generally been worded so as to apply only
to women and children, but the practical effect has been
in most cases to reduce men's hours to the same extent.
This is especially true where complex machinery is
used, and women and children perform certain indis-
pensable operations in connection with the running of
such machinery. When they stop work, the whole must
stop, and the men are released at the same time. Even
where the work of the men and women is independent,
the fact of shorter hours for the women has often been
a powerful aid to the men in demanding the same for
themselves. In concerns where most of the employees
are men, the labor unions have generally proved strong
enough to establish shorter hour systems without legal
help.

Laws limiting the hours of labor on public works
have been passed by Congress with reference to United
States government employees, and also by the legisla-
tures of nine states. The limit is eight hours in Cali-
fornia, Colorado, the District of Columbia (United
States employees), in Idaho (for manual labor), the city
of Baltimore (for mechanics and laborers), in Pennsyl-
vania (for mechanics and laborers), in Utah, and Wyom-
ing. Outside of the District of Columbia, eight hours
is the rule for all laborers and mechanics employed by
the United States government, and letter carriers are
to be paid on the eight hour basis. In Massachusetts
and Texas the limit is nine hours, and in New York

1899-]' LABOR LAWS IN THE UNITED STATES 173

State all public work is to be paid for on the eight
hour basis.

The laws denning the number of hours that shall
constitute a legal day's work unless otherwise contrac-
ted, really amount to very little. When employers
choose to prescribe longer hours it is assumed that the
employee, by virtue of accepting the position, agrees to
the longer system. In some cases perhaps it may serve
as a basis for recovering pay for overtime, but instances
of this sort are extremely rare. However, laws of this
sort exist in sixteen states, as follows:

Eight hours is a legal day's work, unless otherwise
contracted, in California, Connecticut, Illinois, Indiana,
Missouri, New York, Ohio, Pennsylvania, Wisconsin,
and Wyoming (for coal mine employees) : ten hours in
Florida, Maine, Maryland (for miners in Allegheny and
Garrett Counties), Michigan, Minnesota and New
Hampshire.

Several of the states have laws restricting the
hours of labor of street railway employees. These are
as follows:

California, twelve hours; Florida, thirteen hours;
Georgia, thirteen hours; Louisiana, twelve hours;
Maryland, twelve hours; Massachusetts, ten hours;
Michigan, ten hours; New Jersey, twelve hours; New
York, ten hours in cities of 100,000 and over; Pennsyl-
vania, twelve hours; South Carolina, twelve hours;
West Virginia, ten hours.

By far the most important laws are those which
definitely restrict the hours of labor in factories, work-
shops, etc., and provide penalties for working beyond
the limits established. These are the measures that
represent the real gist of the shorter hour movement.
The first of the sort were enacted in New England, but
they have been copied in most of the middle and west-
ern states. The South is still behind in this respect.

174 GUNTON'S MAGAZINE [March,

Only one southern state, and that not in the cotton
manufacturing region, has a ten hour law. It is very
largely for this reason that it has become important to
have a national uniform hour system established, which
will prevent any one section of the country, such as the
South, from having a competitive advantage over the
rest by reason, not of superior productive capacity, but
of inferior labor conditions. As we have said, most of
the laws limiting the hours of labor in factories apply
only to women and children, because it has been chiefly
for their protection that such laws were needed. In
the case of the men it has been left to the labor unions
to establish conditions which women and children have
not been able to establish for themselves.

In two states, Illinois and Nebraska, laws limiting
the hours of labor were passed but have been declared
unconstitutional. The Illinois law restricted the labor
of women and children to eight hours. The Nebraska
law prescribed eight hours as a legal day's work for
laborers and mechanics. Laws have been passed and
not overruled by the courts in twenty-three states and
one territory, as follows:

Georgia; from sunrise to sunset for all persons
under twenty-one years of age; eleven hours per day
for operatives in cotton or woolen factories.

Illinois; ten hours for children under sixteen
years.

Indiana; ten hours for women under eighteen and
all persons under sixteen; eight hours for children
under fourteen.

Louisiana; ten hours for women and for all
persons under eighteen years of age.

Maine; ten hours for women, and for boys under
sixteen years of age.

Maryland; ten hours for women, and all em-
ployees under twenty-one years of age, in cotton or

i899- ] LABOR LAWS IN THE UNITED STATES 175

woolen factories; ten hours for children under sixteen,
in any industry.

Massachusetts; ten hours, and not more than fifty-
eight hours per week, for women and for all persons
under eighteen years of age, in factories; and sixty
hours per week in mercantile establishments for all
under eighteen years of age.

Michigan; ten hours for women and for all persons
under eighteen years of age ; nine hours for boys under
fourteen and girls under sixteen.

Minnesota; ten hours for children under fourteen.

Montana; eight hours for stationary engineers.

New Hampshire; ten hours for women and for all
persons under eighteen years.

New Jersey; ten hours, and Saturday half holiday
after twelve o'clock noon for women and for all persons
under eighteen years of age, in factories; ten hours in
bakeries and candy shops.

New York; ten hours for women under twenty-one
and all persons under eighteen; ten hours on steam
surface and elevated roads, except where mileage sys-
tem of payment is used; ten hours for all brickyard em-
ployees; ten hours, or not more than sixty hours per
week, in mercantile establishments, for women under
twenty-one and boys under sixteen.

North Dakota; ten hours for women and for all per-
sons under eighteen.

Ohio; ten hours for all persons under eighteen
years of age.

Oklahoma; ten hours for women and all persons
under eighteen.

Pennsylvania; ten hours in factories and mercantile
establishments, for women and for all persons under
twenty-one years of age.

Rhode Island; ten hours for women and for all
persons under sixteen years of age.

1 76 GUNTON'S MAGAZINE [March,

South. Carolina; eleven hours for operatives in cot-
ton and woolen factories.

South Dakota; ten hours for women and for all
persons under eighteen.

Utah; eight hours in underground mines and in
smelters. This was the law whose constitutionality
was affirmed by the United States Supreme Court on
February 28th, 1898. Full review and comment on
this most important case was given in Guntoris Magazine
for November, — article, "Eight Hours and the Con-
stitution."

Vermont; ten hours for children under fifteen.

Virginia; ten hours for women and all children
under fourteen.

Wisconsin; eight hours for women and all children
under eighteen years of age. The penalty, however,
applies only to employers who compel work in excess of
these limits.

Hardly less important than restriction of the hours
of labor in factories is the matter of prohibition of child
labor. Statistics gathered by the United States De-
partment of Labor show that the employment of
children in this country has been steadily diminishing
for a number of years, not only relatively to population,
but actually in the number of children employed.
There is little doubt that this change is due almost
entirely to the legislation on the subject that has been
enacted during recent years. These laws have been of
two general classes, one designed to prevent children
from appearing in certain kinds of public exhibitions,1
the other intended to prohibit the labor of children
under a certain age in factories, and to secure their
attendance at the public schools.

The laws prohibiting children from taking part in
certain kinds of public exhibitions, or begging in the
streets, exist in twenty-three states and the District of

iS99.] LABOR LAWS IN THE UNITED STATES 177

Columbia, to wit: — California, Colorado, Connecticut,
Delaware, District of Columbia, Georgia, Illinois, Indi-
ana, Kansas, Kentucky, Maryland, Massachusetts,
Michigan, Minnesota, Missouri, Montana, New Hamp-
shire, New Jersey, New York, Ohio, Pennsylvania,
Rhode Island, Wisconsin and Wyoming. The age
limit in most of these cases is sixteen years, in some
fourteen.

Employment of children in various forms of pro-
ductive labor is prohibited as follows:

Alabama; under twelve years (in mines).

Arkansas; under fourteen (in mines), and boys under
sixteen who cannot read and write.

California; under ten years, in factories and stores.

Colorado; under fourteen years in factories, or in
any business during school hours; under twelve years
in coal mines, and under sixteen unless able to read
and write.

Connecticut; under fourteen years in factories and
stores, and under sixteen years unless able to read and
write.

Florida; under fifteen years unless with the con-
sent of parent or guardian.

Idaho; under fourteen years, in mines.

Illinois; under fourteen years in factories, stores,
offices, etc.

Indiana; under fourteen years in factories, iron
works and mines.

Iowa; under twelve years in mines.

Kansas; under twelve years in mines and under
sixteen unless able to read and write.

Louisiana; boys under twelve and girls under four-
teen, in factories.

Maine; under twelve years in cotton or woolen
factories, and under fifteen unless having had certain
previous schooling.

I7t GUNTON'S MAGAZINE [March,

Maryland; under twelve years in all except canned
goods factories.

Massachusetts; under fourteen years in factories
and stores, or in any business during school hours;
under sixteen unless able to read and write, or child is
attending night school.

Michigan; under twelve years in mercantile estab-
lishments, and under fourteen in factories.

Minnesota; under fourteen in factories, mines,
stores, etc. ; under sixteen unless able to read and write.

Missouri; under 14 years of age, in factories where
power machinery is used, or work is dangerous to health.

Nebraska; under twelve years in factories and
mines.

New Hampshire; under ten years in factories and
under sixteen years unless able to read and write.

New Jersey; boys under twelve years and girls
under fourteen, in factories and mines, and all under
fifteen unless having had certain previous schooling.

New York; under fourteen years in factories, and
under sixteen unless able to read and write and having
had one year's schooling; in stores, under twelve years,
and under fourteen except during school vacations,
and under sixteen unless able to read and write and
having had one year's schooling.

North Dakota; under twelve years in mines and
factories, and under fourteen years unless having cer-
tain regular schooling.

Ohio; under fourteen years, in factories, during
school sessions.

Pennsylvania; under thirteen years in factories or
stores, and under sixteen years unless able to read and
write.

Rhode Island; under twelve years in factories and
stores, and under fifteen years except during school
vacations, unless having had certain previous schooling.

1899.] LABOR LAWS IN THE UNITED STATES 179

South Dakota; under fourteen years of age in
mines during school hours; also in factories and stores
unless having certain regular schooling.

Tennessee; under twelve years of age in factories
and mines.

Utah; under fourteen years of age in mines and
smelters.

Vermont; under ten years of age, and under four-
teen unless able to read and write.

Washington; under fourteen years of age in mines,
and under twelve years in collieries.

West Virginia; under twelve years of age in mines
and factories.

Wisconsin; under fourteen years of age in factories,
mines and workshops.

Wyoming; under fourteen years of age in mines.

Employment of children under twelve years of age
is also prohibited in mines in the territories of the
United States.

Some of the above laws are accompanied by provi-
sions allowing local judges to suspend the law in cases
where the child's work is absolutely necessary for the
support of dependent relatives. In some other cases
child-labor is permitted during school vacations. These
exceptions, however, do not materially affect the scope
or application of the laws.

DISTINGUISHED ECONOMISTS
IX — JEAN BAPTISTE SAY

Jean Baptiste Say (1767-1832) really stands on the
threshold of modern political economy in Europe. He
is the conspicuous landmark between the physiocrats
and the commodity school represented by the English
economists from Adam Smith to Jevons. He was
really a convert and disciple of Adam Smith, and pub-
lished his first great work, "Treatise on Political Econ-
omy" twenty-seven years (1803) after the appearance of
"The Wealth of Nations."

Say, however, was quite a different type of man
from Adam Smith. The great Scotchman was a monu-
ment of good sense. He was an extraordinary observer
but he was not a systematic, orderly thinker. He was
philosophical, equal to large generalizations, but capable
of disorderly presentation. This was characteristic of
his great work "The Wealth of Nations," by which he
will forever be known to the human race.

Say's work shows much less of the observer, but
more of the logician and scientist. He struggled to
\| separate economics from political action, and make it
an abstract science. He divided his work into three
parts, — production, distribution and consumption.
While he did much to give order and precision to the
subject, he made it more of a physical than a social
science. He treated production, distribution and con-
sumption practically as three physical bodies operating
upon each other, regarding production of one class of
things as necessarily demand for another class.

This error to some extent flavored English litera-

. ture. It was repeated with considerable elaboration

by Professor Cairnes as late as 1874. All production is

really induced, not by other production, but by the

1 80

DISTINGUISHED ECONOMISTS :— SAY 181

social wants and desires of the people; and hence the%
real vitalizing force behind production, exchange and
distribution of wealth is what has now come to be,
designated as the standard of living.

In the absence of this, and with his absolute accept-
ance of the Malthusian theory of population and utter
repugnance to the paternal methods of mercantilism,
especially as applied in France before the Revolution,
Say was a bloodless advocate of laissez faire; not merely
as a free trader, but as believing that government was
good in proportion as it was negative and weak. To
him, laborers were so much force in production, and
could be considered in no other way. When there were
too many, economic law did its proper work by starving
a number of them out of the way. His countryman
and great admirer, Blanqui, says that he even favored
slavery on the ground thaf it was more economical to
use slaves than free men; but, in a later work, " Com-
plete Course in Political Economy," he modifies this.

However, Say's contribution to economic science i
was really to systematize it, separate it from politics
and paternalism, and reduce it to a study of economic
phenomena. In his hands, however, the science was
reduced to an emaciated skeleton without flesh and
blood and human sympathy and social psychology, a
degree of nakedness in which it never appeared in
England. But, with Adam Smith in England in 1776,
and Say in France in 1803, mercantilism and the narrow
agricultural physiocratic theories were essentially over-
thrown, never again to rise into prominence. In many
senses it may be said that Say systematized Adam
Smith, and, through the extensive use of the French
language, popularized English economics in Europe.

EDITORIAL CRUCIBLE

THE BALDWIN LOCOMOTIVE WORKS, of Philadel-
phia, has just closed a contract for building eighty-one
locomotives to be sent to China for the new railroad
being constructed in the Flowery Kingdom. These
•eighty-one American locomotives are to be the real mis-
sionaries of civilization. Nothing has occurred in a
hundred years which so significantly indicates that the
hardened crust of arrested Asiatic civilization is to be
broken as does this order for eighty- one locomotives to
snort defiance to superstition and demonstrate the effi-
ciency of modern civilized methods under the very
noses of fossilized Chinamen at home. Steam railroads
will make the way for steam factories, and, when factory
methods have been, fairly well established in the Chi-
nese Empire, real progress may be expected to set in.
However terrible and sacrilegious the railroad may
seem, the steam engine is the percursor of a new era
and ultimately of a new type of civilization for the
Mongolian race.

COLONEL ROOSEVELT'S conduct as Governor thus
far furnishes one of the rare instances of literal fulfill-
ment of promises made on the stump. When he was
speaking during the campaign he expressed pronounced
views on the labor question, freely conferred with the
more judicious leaders of organized labor, and in his
first message made two definite recommendations for
labor legislation. One was that the enforcement of
labor laws should be put under the Board of Factory
Inspection, and the other was an amendment to the law-
relating to sweatshops, designed more effectively to
extinguish that type of industry. On the third and
ninth of February respectively, these two measures
were introduced, by Mr. Costello. If political promises

182

EDITORIAL CRUCIBLE 183

were generally kept like this, public confidence in such
pledges would greatly increase. Co-operation in the
•support of this legislation will yield much more benefit
to workingmen than the organization of new political
parties all alone by themselves; and, if all candidates
for office would live up to their promises in the same
way, the temptation for workingmen to fritter away
their political influence in socialistic labor parties would
be very much diminished.

THE CHICAGO Inter-Ocean seems to have taken a
contract to hound Speaker Reed from his leadership
in the House, and ultimately from public life. Chicago
people are prone to undertake big things but there is a
point at which one would think even a Chicago man
would pause. Last summer the Inter-Ocean predicted
that Maine was turning its back on Mr. Reed, and
that he would not be re-elected to Congress; but some-
how the people of Maine did not get the word from the
Inter-Ocean. They did the extraordinary, and gave him
a bigger majority than ever. Now he is to be removed
from the Speakership by the coming Congress, and this
will so rile the Speaker that he will split the Republican
Party in two in the next general election, and so ruin
the country. It is important, according to the Inter-
Ocean, therefore, that Reed be killed off at once.

The Inter-Ocean used to be a very vigorous, sensi-
ble paper, but it seems to have become so Yerkes-ised
that it can only act in public affairs by attacking per-
sons. This is a misfortune. There is no doubt that
the Yerkes influence in Chicago is very great, and may
accomplish many things the history of which would
better never be written; but really, the Inter- Ocean
would better be content with something less than anni-
hilating Speaker Reed.

1 84 GUNTON'S MAGAZINE [March,

AT A RECENT meeting of the Central Federated
Trades in New York City, it was proposed that all
elements of workingmen unite ~to form a labor political
party. A resolution was passed adopting the following
platform :

First ; Public ownership and operation of all means of transpor-
tation.

Second; Public ownership and operation of the telegraph and
telephone systems.

Third; Public ownership of all gas, electric and water plants.

Fourth ; The strict enforcement of all labor and factory inspection
laws.

Fifth; The establishment of labor bureaus in the chief labor
centers of the state, under the control of trades unions.

This is about as poor a platform as could possibly
have been devised. Four out of the five propositions
are worse than good-for-nothing. The first three are
pure socialism, and the fifth is a simple absurdity. The
idea of the state establishing labor bureaus in all the
leading cities and putting them under the entire control
of labor unions cannot for a moment be taken seriously.
The public would never endorse fuch folly, and, if it
did, imagine the value of information collected by
bureaus controlled by organizations which could endorse
a platform like this. If this platform adequately
represents labor organizations it is evidence that they
are degenerating into the quagmire of political vagary.
In proportion as trades unions transform into socialistic
political organizations of this character is their economic
usefulness nearing its end.

IN A RECENT Bulletin issued by the Massachusetts
Bureau of Statistics of Labor, a table of comparative
wages in certain trades from 1870 to 1898 is given for
Boston and for twelve cities in the United States. The
result shows a general rise of the wage level in all the
cities. In reviewing the subject the Bulletin makes the
following significant observations: —

i899.] EDITORIAL CRUCIBLE 185

" The more this matter of the standardjc)f_living is
examined, the clearer it is seen that it touches the
prosperity and welfare, not merely of the worker, but
of society itself. The moral evils that flow from a low
standard of living are obvious. It is not qirite so obvious,
^but equally true, that it fosters economic evils as well."

This is sound economic doctrine, which is steadily
gaining acceptance. Twenty years ago the idea that
the standard of living was an important factor in wage
conditions and social welfare was regarded as putting
the cart before the horse, but, as scientific investigation
increases and social induction widens, it is gradually
coming to be seen that the true philosophy of social
progress is that improvement in wages, social condi-
tions, and political institutions depends largely upon
forces initiated by the social standard of living of the
people. It is beginning to be a demonstrable fact in
sociology that a high standard of living in a community
is the great source of productive economy as well as of a
higher grade of social morality and political integrity.
The market as well as1 the morals of' the community is
graded by the standard of living of the people. In the
long run a low-wage civilization is dearer than a high-
wage civilization. The road to the maximum economy,
lowest cost of production, and highest standard of in-
telligence and morality, is through good wages and a
high standard of living.

IT is PUBLICLY announced that Hon. Tom L. John-
son, formerly of Cleveland, Ohio, who has made a very
large fortune in the manufacture of steel rails, has re-
tired from money-making to devote his entire time to
propagating the single-tax doctrine. This has brought
upon Mr. Johnson some hypercritical comments; such,
for instance, as demanding that if he believes the gains
from private monopoly are robbery he should return his

186 GUNTON'S MAGAZINE

fortune to the public from whom he stole it. This is a
little severe, and hardly fair. Nevertheless, Mr. John-
son must remember that it is an essential tenet in Mr.
George's creed that unjustly acquired goods shall be
•confiscated, and if the original owners cannot be found
it shall go to the public; — age, custom, law, and the
other conditions which sanctioned the robbery, to the
contrary notwithstanding. Still, this is where Mr.
George was very weak, and Mr. Johnson seems rather
strong; he declines to give it up. And in this Mr.
Johnson is right; he would be not much short of a fool
to do so.

But what is Mr. Johnson going to do with it? Is
he going to pay for the propagation of the theory that
to remove taxes from everything but land would solve
the problem of poverty? If so, he would better have
continued to make good steel rails. They would be of
much more service to public welfare. Is he going to
spend his fortune in propagating the doctrine Mr.
George advocated when candidate for Mayor of New
York, viz: that surface railroads should be owned by
the city and run free for the public, — which of course
is only one step short of feeding and clothing the public
at public expense ? No, it does not seem possible that
hard-headed, money-making, horse-sense Tom L. John-
son would devote his energies and fortune to such uneco-
nomic and impracticable vagaries as these. Yet, what
else can he do if he insists on spreading the gospel of
Henry George ? Justice seems to demand that judg-
ment be suspended till Johnson is heard from.

EVENTS WORTH NOTING

February i. General Maximo Gomez, head of the
Cuban insurgent army, assented to propositions for pay-
ment and disbandment of the Cuban soldiers, submitted
to him by Special Commissioner Robert P. Porter in
behalf of President McKinley. It was agreed that the
United States should distribute to the Cuban soldiers
the sum of $3,000,000, not to be regarded as salary but
to facilitate disbandment of the army, and that General
Gomez proceed to Havana and co-operate with Govern-
or-General Brooke in carrying out this program.

February i. Since January 24th, inclusive, United
States senators have been chosen in various states as
follows :

New Jersey: John Kean (Rep.) to succeed James
Smith, Jr. (Dem.); Texas: C. A. Culberson (Dem.) to
succeed Roger Q. Mills (Dem.); Nevada: William M.
Stewart (Pop.); and, Wyoming, Clarence D. Clark
(Rep.) to succeed themselves; West Virginia: Nathan
B. Scott (Rep.) to succeed Charles J. Faulkner (Dem.);
Montana: William A. Clark (Sil. Rep.) to succeed Lee
Mantle (Sil. Rep.); Wisconsin: Joseph V. Quarles
(Rep.) to succeed John I/ Mitchell (Dem.); Washing-
ton: Addison G. Foster (Rep.) to succeed John L. Wil-
son (Rep.)

February 2. At a conference at Melbourne, the
premiers representing five of the colonies of Australia
reached an agreement which will probably lead to
political federation of the colonies at an early date.
Under the proposed plan there will be a Governor-
General representing the Queen of England, and seven
ministers associated with him in the executive depart-
ment. There will be a federal Parliament, with Senate
and House of Representatives; each colony will have
six members in the Senate, elected for six years; and in

187

i88 GUNTON'S MAGAZINE [March,

the House of Representatives there will be 64 members
elected for three years, 24 from New South Wales, 23
from Victoria, 7 from South Australia, 5 from West
Australia and 5 from Tasmania. Formal ratification of
the agreement of the premiers will of course be neces-
sary before Australian federation becomes a fact.

February 2. An American syndicate has within a
few days purchased several important railway lines in
the sugar-producing districts of Cuba; aggregating a
capital of about $10,000,000. This same syndicate has
purchased the principal line of coast vessels on the
north coast of Cuba.

February 4.. A severe battle occurred between the
Filipino insurgents, numbering over 20,000, and the
American troops in and about Manila, which was con-
tinued at intervals through the night and the next day.
The American navy in the harbor took part in the en-
gagement, and the insurgents were repulsed with es-
timated loss of several thousand killed and wounded.
The American loss was about 50 killed and 200 wounded.
The battle was brought on by repeated attempts of
several Filipinos to pass the picket lines of an American
regiment stationed at Santa Mesa; in accordance, prob-
ably, with Aguinaldo's pre-arranged program.

February 6. The Treaty of Peace between the
United States and Spain, agreed upon by the Com-
missioners at Paris, on December loth last, was ratified
by the United States Senate by a vote of 57 to 27. The
affirmative vote was made up of 39 Republicans, i In-
dependent, 10 Democrats and 7 Populist and Silver
senators; the opposition vote, 22 Democrats, 2 Republi-
cans, i Silver Republican and 2 Populists. The treaty
provides for relinquishment of Spanish sovereignty in
Cuba, cession to the United States of Porto Rico and
the other Spanish islands in the West Indies, also
Guam in the Ladrones, and the entire Philippine group;

1899.] EVENTS WORTH NOTING 189

tie United States to pay Spain $20,000,000, send home
Spanish prisoners, and secure release of Spaniards held
prisoners by the insurgents in Cuba and the Philippines.

February 10. The American army drove the Philip-
pine insurgents out of Caloocan, a town about four
miles north of Manila; our loss, four killed and 47
wounded. On the following day, the nth, the city of
Iloilo, capital of Panay, was captured by American
forces under General Miller, with little fighting, and no
losses on the American side.

February 13. The report of the War Investigating
Commission was made public. The most important
findings are: (i) That there was no corruption in the
conduct of the war on the part of War Department
officials; (2) That with few exceptions the refrigerated
beef furnished the soldiers was "pure, sound and
wholesome; " (3) That there was no neglect of duty on
the part of Secretary Alger, but that (4) " there was
lacking in the general administration of the War De-
partment .... that complete grasp of the situ-
ation which was essential to the highest efficiency and
discipline of the Army."

February 14. Mr. McEnery's resolution was adopt-
ed by the United States Senate (26 to 22) declaring
that by ratification of the peace treaty it was not in-
tended to permanently annex the Philippine Islands
"as an integral part of the United States," but to "pre-
pare them for local self-government," etc. The resolu-
tion, however, contains no intimation of eventually
withdrawing American in favor of local authority, as in
the case of Cuba.

February 16. Felix Faure, President of France,
died from apoplexy, in Paris. Two days later, Feb. 18,
the National Assembly, convened at Versailles, elected
in his stead Emile Loubet, President of the Senate, a
conservative Republican.

Civics AND EDUCATION

MUNICIPAL SOCIALISM

The movement for public ownership of industrial
enterprises, which, during the last few years, has
cropped out at different points along the whole line of
political agitation, from extreme populism to free trade,
has now begun to concentrate upon municipal affairs.
Public ownership of various economic functions, like
street railways, telephones, telegraphs, etc., is beginning
to take the form of an economic creed. It is probably
safe to say that no general movement in society was.
ever all wrong. There is "A soul of truth in things
erroneous." So, in the demand for extending govern-
ment authority in the direction of certain social-
economic functions, there is an increment of justification.

In this country, we can only expect that thing to
succeed which contains the inherent elements of giving
the maximum benefit for the minimum inconvenience,
independently of social prejudice, but solely from the
nature of things. History and economic principle,
therefore, and not sentimental imitation of England,
Germany, or other countries, is what must be relied on
to work successfully in a country like this, which has
no traditional superstitions to create highly flavored
presumptions and enthusiastic co-operation with un-
economic, paternalistic undertakings.

There is a ' * soul of truth " in both socialism and
individualism. There is a class of functions that can
be better performed by society than by individuals,
and conversely there is another class of functions that
can be better performed by individual effort than by
society. The division between these two classes of
functions is not arbitrary but evolutionary. In the
progress of society natural selection has drawn a fairly

190

MUNICIPAL SOCIALISM 191

distinct line of demarcation between them. Conspicuous
among functions that have passed to collective effort
are protection of life and property, by army, navy and
police force, charge of the public highways, popular
education, regulation of weights and measures, and
administration of justice. All these functions, which
are highly representative of the class of things that
have passed into collective management, have three
distinct characteristics : they are of very general interest,
they are impersonal in character and interest, and they
are essentially simple and permanent. The army, for
instance, is the very acme of simplicity and permanence;
it is impersonal, and of general interest. Individuality
is destructive of efficient army service. It is blind
obedience to a single voice that makes efficiency in
military service. The changes in the army are slight
and slow. For these reasons it is eminently fitted for
collective administration. This is essentially true, also,
of the care of highways, conducting of public schools,
management of police force, cleaning of streets, regula-
tion of weights and measures, administration of justice,
etc. All these functions are very largely impersonal and
affect all the community substantially alike. They can be
conducted by a collective, representative body, as well
and in some instances better than by individual authority.
The characteristics of the class of functions which,
have gradually passed to the sphere of individual effort
are radically different. They include such things as
the right of religious and political opinion, the right of
individual contract, fixing of wages, the pursuit of oc-
cupations, methods of business, and the conducting of
productive enterprises. In all these, the first essential
characteristic is that they are largely personal in their
character. The great interest of religious opinion is to
the individual. It is his concern and not the state's.
Hence he is more competent to decide it than anybody

i92 GUN TON'S MAGAZINE [March,

is to decide it for him. The consequences are his own,
and hence the responsibility should be, and as progress
advances is, his own. The same is essentially true of the
right to make individual contracts, freedom of political
opinion, and in fact of all the functions which have now
passed to the sphere of individual action.

So, too, with complex industrial enterprise. Wher-
ever success depends upon innovations and im-
provements involving quick and expert decision, it is
obvious that the best results can only be obtained by
individual control, because these features cannot be fur-
nished by collective action. Government is too ponder-
ous and slow to give a decision on anything of import-
ance in less than a year or two. This incompetence
increases as civilization advances and democracy supplants
despotism in government. If, for instance, the Czar of
Russia decides that electricity instead of steam shall be
used on the Russian railroads, he can order it and it will
be done. In this country it would be necessary not merely
to convince the President of the importance of revolution-
izing the motive power of the railroad system, but it
would be necessary to convince the people in the major-
ity of the congressional districts throughout the coun-
try, which might involve several presidential cam-
paigns, and take a quarter of a century to accomplish
what a Czar could decide in a day or two. Under private
ownership this transition can, and usually does, take
place even more quickly than under despotism, because
those who control the railroads are the ones who profit
most by the new, if it is a success, and lose the most if
it is a failure. Their knowledge and interest both con-
tribute to rapidity of decision and efficiency of the
movement.

In manufactures, where the form, method and type
of industry are constantly undergoing change (frequent-
ly quite radical,) collective authority would have the

1899.] MUNICIPAL SOCIALISM 193

maximum inefficiency, and it would be more inefficient
under democracy than under absolute despotism. In-
stances illustrating this could be given indefinitely.

The successes and failures in the conscious experi-
ments of collective action confirm this view. The his-
tory of co-operative or socialistic efforts in various eco-
nomic and social undertakings show that in proportion
as the undertakings have been general, simple and im-
personal in character, they have had comparative suc-
cess, and vice versa. Take English co-operation as an
illustration. In the line of conducting wholesale and
retail stores they have been successful. The buying
and selling of sugar, butter and cheese is a simple,
permanent process. All that is needed is integrity
and intelligence enough to buy wisely and sell honestly.
In this, collectivism has been a success, but wherever
it has assumed the function of complex productive ef-
forts, like manufacture, which was open to the competi-
tion of new methods and radical changes in machines
and methods of organization, collectivism has signally
failed. Its greatest success in this direction has been
in farming, because the industry is of the simplest
and most permanent character, with the least call for
expert and quick decision and sudden adaptation to new
conditions- Take the labor movement. Workingmen
have succeeded most signally in the trades-union organ-
izations, because the objects were simple and perma-
nent. To organize for more wages, shorter hours, ex-
clusion of children from workshops, and other simple,
direct economic changes, did not call for the exercise of
exceptional individual talent, and consequently they
have been a constantly increasing success; but wherever
they have branched out into undertakings of a complex,
tentative character, they have failed.

The further we pursue this inquiry the clearer it
becomes that efficiency in collective control can only be

i94 GUNTON'S MAGAZINE [March,

secured in proportion as the function is general, simple,
permanent and impersonal in character, and that in pro-
portion as it is complex, variable and competitive the
best results can be secured by personal control and re-
sponsibility for the benefits and losses of the undertaking

How far, then, should we go at present in the di-
rection of municipal socialism? Not a few of the inher-
ent difficulties of public control, except where absolute
permanence of character and method has been establish-
ed, come with the habitual and often disreputable work-
ing of the spoils system. In what direction and how
far can we at present extend public ownership in muni-
cipal matters? Municipal water supply, care of the pub-
lic streets, and the schools, are evidently in the stage
where they can safely be conducted under public con-
trol, although water supply is not yet a government
function in all municipalities in this country. In these
departments perfection of method has been sufficiently
developed to entrust the duty to collective authority.
Much improvement is yet to be made in the methods of
education, and discussion of comparative methods will
gradually evolve perfection in that direction.

But how is it in the case of the development of
rapid transit in New York City? It is more than prob-
able that if the surface roads had all been in the hands of
the city, as socialists and single taxers advocate, very
few of the great improvements that have been devel-
oped during the last few years would have been ob-
tained. Horses might have been superseded by elec-
tricity, but even that is doubtful if surface car lines had
been owned by the public in all cities, because the ap-
plication of electricity might not have been developed
at all, for want of sufficient incentive to call out the
costly experiments, and the great difficulty in getting
it adopted.

Having been developed elsewhere by private enter-

I899-] MUNICIPAL SOCIALISM igs

prise, however, electricity might have been applied
to surface railroads in New York, but undoubtedly it
would have been the overhead trolley system with all
its annoying inconveniences. Once that system was in,
it would have been practically impossible, for a long
time at least, to get the public of New York to expend
the millions necessary either to experiment with, or to*
apply after others had experimented, the later and im-
proved system of underground trolley. Whenever a
large sum of money is needed for a public enterprise
the taxpayers have to be converted; whereas, with pri-
vate enterprise, only the prospect of increased earnings
is necessary to bring a decision.

Compare the transition from horse cars to under-
ground trolleys in New York City with the im-
provement of the canals by the state government. The
canals have cost many times as much as was expected,
and the whole thing is now shown to have been ineffi-
ciently administered besides being scandalously corrupt.
The state is taxed inordinately for the improvement,
and now has to tax itself again before the work can be
finished. The whole transition in the street cars of
New York City has taken place without the public hav-
ing been taxed a penny., and, instead of the cost of
transportation having been increased, every move has
been a reduction in price by extending the transfer sys-
tem to other roads and avenues. The cable, which was
put in at an enormous expense, is now to be torn up to
substitute the underground trolley, simply because
there is a slight economy and hence better profits in
sight for the immense investment.

In this way, private enterprise is altogether more
efficient in the development and perfection of the best
methods than public ownership ever was, or in the na-
ture of things ever could be, and all because of the
capitalistic foresight, the complexity, need of expert

196 GUNTON'S MAGAZINE [March,

decision and power promptly to decide, which public
ownership never can give. The elevated railroads are
going to spend fifteen or twenty millions in a similar
improvement, but this will come without any increased
tax on the public.

The great advantage of having private ownership
during the process of development and perfection of
these public services is that the interest of the public is
placed over against the service of the corporation. In
other words, the public, not being called upon to make
the expenditure but only to pay individually for the
service, has all the incentive constantly to complain of
poor service and demand better, and thus bring a social
whip to bear upon the private concerns in question.
When approximate perfection is reached, it may be
feasible to transfer the control to the public; but, until
then, such transfer would tend to lessen the improve-
ments and keep back for an indefinite time the best ser-
vice to the public. Collective action in this matter can
be far more effectively exercised through legislative
authority to inspect, to demand improvements, and to
compel corporations to pay for charter privileges, than
by ownership or control.

The principle is the same in the case of tenement
houses. Much greater improvement can be secured by
capitalist ownership of tenement houses than by individ-
ual ownership by poor occupants. If the very poor
people in our great cities should own the vile quarters
they live in — even if they were given to them — it would
be a detriment to the progress of improvement in city
residential properties. The owners of the poor hovels
would become a resisting power to improvements, be-
cause they themselves would have to pay for the im-
provements. It is the experience of all boards of health
that they have the greatest trouble to get good sanitary
conditions into houses occupied by the owners. When

iS99.] MUNICIPAL SOCIALISM 197

the poor people are tenants, their interests are allied
with those of the public, and the board of health can
get complaints and co-operation from them, and they
will move out of the poor houses into better ones as fast
as they appear; and so, both the competitive mobility
of the tenants and the public spirit of the community
are brought to bear upon the owners of the miserable
tenement houses. Further, we can then get legislation
demanding sanitation and ventilation and modern im-
provements; whereas, if the poor people themselves
owned them they would vote against legislation enforc-
ing such improvements. The improvement that has
taken place in New York City under this pressure is
many times greater than it would have been if the poor
people had owned the vile places they lived in.

This is even more true of the great railroad sys-
tems, and of motive power for manufactures, throughout
the nation. The whole system of transportation is still
in its infancy. In all probability, if the power of com-
petitive experiment under private control is permitted
to continue, much of our railroad system, and the bulk
of the power for manufactures, will be furnished by
harnessing the great waterfalls of the nation to the pro-
duction of electricity. The thousands of millions of
dollars that will have to be devoted to experimentation
in order to harness the great waterfalls, and perhaps,
the tides of the ocean, to the work of running our fac-
tories and furnishing power for our railroads would not
in centuries, if ever, be furnished by public appropri-
ations. Nothing but the confidence born of personal
knowledge, and the hope inspired by profits yet to
come, will impel the undertaking which shall perfect
our railway system and give the maximum economy to
the processes of manufacture which are yet destined to
make an even greater revolution in motive power and
a wider contribution to civilization than came with the
substitution of steam for hand labor.

CIVIC AND EDUCATIONAL NOTES

The Church Extension Missionary Society of New
York City, including some twenty churches, is develop-
How to Utilize in£ a Plan for utilizing the down-town
Abandoned churches which have been for years
City Churches steadily declining, because of the uptown
movement of population, until now, if operated at all,
it has to be by outside help. This society proposes to
•establish kindergartens in the abandoned churches com-
ing within its sphere of authority, and several such
kindergartens have already been put in operation. This
is a most encouraging movement, both for the reason
that it shows the increasing disposition of the church to
take part in the solution of social problems, and also
because it furnishes the ideal solution of the problem of
what to do with the church buildings which the move-
ment of population has left without support, by convert-
ing them into headquarters for kindergartens, training
schools, social settlement work, meetings of labor organi-
zations, etc. These would be effective methods of rais-
ing the new class of population that has come in around
these churches, up to the level of their former congre-
gations. It is impossible to maintain these organiza-
tions on the old lines so long as the people now living
about them are of a type and character not in sympathy
with the customs or beliefs held by their former sup-
porters; hence it is necessary, in order not to aban-
don the churches entirely, to say nothing of restoring
their religious functions, that the new population shall
approach the standards of the old ; and the churches
themselves, by becoming centers of sociological work,
can be important instruments of that very change.

The United States Government now maintains 147

198

CIVIL AND EDUCATIONAL NOTES 199

Indian boarding schools, accommodating last year near-
ly 24,000 pupils. Commissioner Jones

Education savs that the results are excellent in
three per cent, of the cases, good or me-
dium in seventy-three per cent., and bad or worthless
in only twenty-four per cent. There is no denying
that this is a good showing; but it is more than likely
that whatever good effects on the character of the In-
dians come from this schooling are due more to the dis-
cipline and regular contact with the teachers, and thus
indirectly with civilization, than to any of the book-
learning that is imparted. We find this view confirmed
in the annual report of Miss Reel, national superinten-
dent of Indian schools. "The aims of the young Indi-
an," she says, "must be made higher; he must be
brought into touch and kept in contact with our civiliza-
tion. Where tribes of Indians have been surrounded
by a good class of white settlers the debasing effects of
camp life have been ended. The placing of Indian
boys and girls at service in families of farmers, although
for a few months only — the girls instructed in the prac-
tical economy of the family life, the boys in farming,
gardening, stock raising, etc., — has met with abundant
success at Carlisle, where the plan originated." She
places the emphasis, furthermore, on the need of indus-
trial rather than merely scholastic education, saying:
"I desire to emphasize the statements of numerous In-
dian educators that industrial training should have the
foremost place in Indian education, for it is the founda-
tion upon which the Government's desire for the im-
provement of the Indian is built. The consensus of opin-
ion of the superintendents at the last summer schools
says that too little attention is paid to this field of labor,
and it was insisted that large facilities for workshops
and teachers be provided, that this work, upon which
the civilization of the race depends, may not suffer."

SCIENCE AND INDUSTRY

THE ETHICS OF TICKET SCALPING

In primitive society it was considered good moral
conduct to ravage, plunder, abduct or kill, provided the
victims belonged to some other tribe. In the Middle
Ages it was thought no particular crime to defraud
or rob a Jew. Cheating and thieving were not in any
approved code of ethics among Christians, but in deal-
ing with Jews fraud was rather a sign of piety, — quite
one of the homely old solid virtues, in fact. If you
wanted to show a really devout abhorrence of a false
religion, why, steal something from a Jew; or, if you
were the government, confiscate his goods, — which is a
politer word and sounds more moral.

To-day it is thought by many a part of good citizen-
ship to "beat a corporation" whenever you can, on general
principles. Not entirely because they are dishonest;—
some of them are, more used to be, — but on the whole
there is quite as much square dealing and effort to be
fair in large business concerns as in the small, hard-
pressed, penny-chasing establishments; perhaps a great
deal more. But the great moral offense of a corpora-
tion is that it is rich, and succeeds. If it happens not
to be rich, still it handles large amounts of money, and
pays good salaries, and the officials do not grant con-
cessions until they are forced to (which is true), and so on.
Hence it is good morals to "beat a corporation"
whenever opportunity offers. Because it is a crirne for
them to fleece me, therefore it is virtuous for me to
fleece them in return. Wonderful, too, the ingenuity
and talent regularly devoted to this retaliatory art! If
in the complex working of the vast machinery of a
modern railroad system, for instance, individual cases
of injustice and arrogance arise, why, I am ethically

THE ETHICS OF TICKET SCALPING 201

justified in forging contract excursion tickets, and lying
to conductors. If the Union Pacific Road smashes a
trunk for John Smith and neglects to pay the full
amount of damage done, why, it is all right for me to
beat my way from New York to Philadelphia on the
Pennsylvania road if I possibly can; and really there is
a sort of moral satisfaction about it. If I get to Phila-
delphia undetected, I can feel that I have stood up and
been counted among the foes of corporate iniquity.

The moral indignation of the community against
railroads finds its largest expression probably in the
patronizing of ticket scalpers. Scalping is a sort of
providential instrument of justice, raised up on purpose
that men might not lack opportunity to promote good
morals by cheating railroad companies.

Coming down to plain speaking, irresponsible
ticket brokerage is either dishonest in itself or rests
upon breaches of faith of some sort. There could be
no business for the scalpers at all except by selling
tickets at less than regular rates, and they cannot get
hold of such tickets except through secret dealings with
certain roads publicly pledged to maintain regular rates,
or by purchase of tickets or passes from individuals who
have agreed not to transfer them. Perhaps the majority
of those who buy scalpers' tickets do not appreciate this
fact, or have allowed self-interest or prejudice very
largely to determine their point of view on the matter.
Not all scalpers themselves are deliberately dishonest.
Some of them do not resort to the grosser forms of
fraud, such as plugging tickets, changing dates and
forging signatures; but nevertheless the whole business
in its very nature involves and rests upon express vio-
lations of contracts between individuals and railroads,
or of understandings between different roads, or tinder-
handed evasion of the rates published for public infor-
mation in accordance with law.

202 GUNTON'S MAGAZINE [March,

The morals of people who deal in fraudulent tick-
ets, or avail themselves of such opportunities in full
consciousness of the nature of the transaction, will not
be improved by any law that can be passed abolishing
the scalping business. That may be admitted at once.
Nevertheless, it is good public policy to prohibit a bus-
iness or institution based upon admittedly dishonest
practices, just the same as it is good public policy to
enact statutes against fraud of any kind, and provide
penalties. It is justified not only for the sake of pro-
tecting the victimized parties, but also on the ground
of removing influences that tend to lower the standard
of public morality. This is the main basis of all the
laws against lotteries, prize-fighting, gambling dens,
foul literature, and degrading public exhibitions.

On the question of the economic effect of the scalp-
ing business, men may honestly differ, but it is an
astonishing thing that reputable journals should be
found arguing in favor of a confessedly dishonest bus-
iness because it is believed to promote competition. If
this line of argument is admissible, the public bullfights
and lotteries of Spain are justified because they bring
revenue to the government and diminish taxation.

In truth, ticket scalping is quite as indefensible on
economic grounds as on moral. The apparent gain to
the public is in reality wholly delusive. By inflicting
upon the railroads a secret and unpreventable loss, the
business is demoralized and regular rates are probably
higher, or reductions less frequent, by reason of these
unseen drains. In other words, it is probably true
that the general traveling public has to pay in higher
or longer-maintained rates a good part of what the
patrons of scalping offices gain by the use of illegiti-
mate tickets. Railroads not in bankruptcy, actual or
hidden, seek to adjust rates with reference to total cost
of service and fixed charges, and the estimated amount

.1899. J THE ETHICS OF TICKET SCALPING 203

of ticket sales; and the greater the cost or the fewer
the tickets sold, necessarily the higher the rates. Coun-
terfeit tickets sold by scalpers represent just so much
diminution of regular cash sales by the roads, and un-
questionably the constant effort is to make up for the
loss in some other way. Some of the principal com-
panies in New York State, for instance, lost nearly
$50,000 in 1896 on fraudulent tickets alone, that were,
unwittingly honored for passage by conductors.

Furthermore, scalping puts a constant and direct
penalty on the granting of reduced rates or special
privileges, because a considerable part of the scalpers'
business consists in the misuse of these very privileges.
There can be little doubt that cheap excursions, mileage
books, family commutation tickets and special rates to
public gatherings would be more numerous, and the
terms more generous, were it not for scalping abuses.
Normally, the fact of largely increased business is a
constant inducement to companies to grant these special
rates. This inducement is materially lessened by the
knowledge that part of the expected profit will be offset
by loss of regular fares that would otherwise be collect-
ed from passengers riding on the return coupons of ex-
cursion tickets originally bought by somebody else.
This point is perfectly plain. The reduced fare is
offered only on condition that the return coupon be
used by the original purchaser, but passengers going
only one way must pay regular fare. When this one-
way passenger uses the return coupon of another per-
son's ticket, the company gets, out of the whole trans-
action, only the price of one reduced rate excursion
ticket. Otherwise, it would get the price of that excur-
sion ticket, and also the full regular fare one way from
the second passenger; as is proper. It was only with
the object of persuading people to make the entire
round trip that the lower rate was granted at all. A

204 GUNTON'S MAGAZINE [March.

person wlio does not buy the whole ticket has no moral
or economic right whatever to the cheaper rate he is-
enjoying. In the language of Justice Clark, of the
United States Circuit Court, District of Tennessee:
" There is no process of reasoning, however strained,
which can, even as a matter of form, conceal this prac-
tical fact that the company is deliberately cheated out
of the value of the regular fare of every mile of its line
over which travel is made under color of one of these
void papers."

But it is urged that scalpers are a necessary means
of maintaining competition between roads, because the
largest part of the scalpers' business consists in handling
tickets secretly furnished them at cut rates by certain
of the competing lines, in violation either of express
agreements with other lines or in defiance of rates pub-
lished in accordance with the Interstate Commerce Law.

Now, a moment's consideration will show that this
process does not produce any of the effects of legitimate
economic competition. Economic competition consists
in open and avowed reduction of prices, and if the cut
is not a mere auction-sale sacrifice but is based on a
genuine reduction in the cost of production due to
economies and improved methods, all the competitors
must sooner or later follow, or leave the business; and
hence all consumers share equally in the advantage.

How is it in the case of scalpers' competition in
railroad tickets ? Just the reverse. There is no open
cut of rates. All the roads establish certain rates, and
publish them for the guidance of the public. Some of
the roads adhere to these rates; others pretend to, but
secretly furnish cut-rate tickets to irresponsible brokers.
The result is that two sets of fares are all the time in
force. Hence we have constant discrimination between
passengers who buy regular tickets and those who
patronize scalpers. It was chiefly to prevent this very

1899.] THE ETHICS OF TICKET SCALPING 205

evil of discrimination that the Interstate Commerce
Law was passed, requiring publication of rates and
.advance notice of changes contemplated by any road.

The public never derives any permanent benefit
from services rendered at less than cost. If we could
have enough auctions or forced sheriff sales to influence
the whole market for manufactured commodities, we
would have universal bankruptcy. Railroads that can-
not be made to pay even their legitimate costs ought
to go into receivership. The opportunity ought not to
exist for keeping up a continuous bankrupt sale, as it
were, merely in order that a certain set of managers may
remain in control; or if they do insist upon that policy,
let it be open and public. The result would very soon
show whether the road could be made a paying property
under the existing management; or whether it would
have to go into receivership and be reorganized on a
sounder basis. Under the present arrangement they are
enabled to perpetuate themselves, not by fairly under-
selling their competitors, but by taking a fraudulent ad-
vantage of them. For instance, these weaker roads
will enter into an agreement with all the others to
maintain certain rates, or, if they make no agreement,
they at least publish certain rates, in accordance with
law. Now, such of these roads as secretly furnish cut-
rate tickets to the scalpers deliberately take advantage
of the superior honor of their competitors. These lat-
ter lines agree to maintain certain rates and strive to do
so. The others, having tied their rivals up with this
sort of an agreement, ignore their own part in the under-
standing and, while pretending to adhere to published
rates, proceed to cut into their competitors' traffic
through the under-handed agency of the scalpers.

Now, if cut-throat competition is better than uni-
form and more slowly declining rates, why, let all rate
agreements between roads be prohibited. At least, let

206 GUNTON'S MAGAZINE [March.

them compete in the open. However desirable com-
petition may be, there is no moral defense for a system
which gives only a partial advantage to one portion of the
traveling public, at the expense of the other, and that
only by continuous violation of the Interstate Commerce
Law or of traffic agreements between roads.

Another point frequently made is that the holders
of unused tickets must suffer loss unless they can sell
them to scalpers. This is untrue. Every well man-
aged railroad company in the country redeems unused
tickets, or portions of tickets, and the bill now before
Congress prohibiting ticket-scalping makes such a re-
duction obligatory upon all railroads. In the case of re-
turn coupons of excursion tickets, the holder is refund-
ed the amount paid for the ticket less the regular fare
for the distance he actually travelled. Necessarily this
reduction is made through the general offices, because
local agents have no proper means of determining the
exact amount due on unused portions of tickets, and
neither have they any means of guarding against fraud
on the part of the person presenting the ticket for re-
demption. During 1896 the New York Central Rail-
road alone paid out nearly $32,00x3 in ticket redemptions.
On the other hand, scalpers seldom or never redeem
the tickets they sell. Passengers make use of scalpers"
tickets entirely at their own risk, and are absolute losers
if the fraud is detected by conductors.

But the immorality of this business does not apply
merely to the brokers and such of the railroads as-
make a practice of secretly disregarding agreed or pub-
lished rates. It offers a standing temptation to breach
of faith or participation in fraud on the part of the pub-
lic as well. It is often said that if a man buys a ticket
to a certain point, he has an absolute right to do with it
what tie will, and if he chooses to sell it to another it is
his privilege to do so. That is true enough with re-

1899.] THE ETHICS OF TICKET SCALPING 2^7

spect to full fare regular tickets. It makes no differ-
ence either to the companies or to the public what in-
dividual uses a ticket of this sort; but it is not true in
the case of tickets sold at a reduced rate and under the
express condition that they be not transferred. The
purchaser of such a ticket agrees, either by signing the
contract or by the very fact of accepting the ticket, that
in consideration of getting a special reduction he will
use the entire ticket himself, or at any rate not transfer
it to another. It is clear enough why the company
should make such a stipulation. It is under no obliga-
tion to make any reduced rate at all. It is simply a
matter of business, and if the passenger does not like to
accept the conditions of the special offer, he is at liberty
to buy a full fare ticket.

The railroad offers the reduced rate simply in order
to induce people to make a full round trip between cer-
tain points. If it could not do this without thereby re-
ducing all its regular one way traffic to the same basis,
it would not make the special rate at all. The only ob-
ject in granting the reduction is to call out new busi-
ness, or insure a return trip over the same line. To
secure this, it is necessary that the tickets be made non-
transferable. This is a perfectly fair business proposi-
tion. If you do not like it you need not take advantage
of it; but if you do, you are morally bound to live up to
your part of the agreement, the same as in any other
kind of contract whatsoever. The person buying such
a ticket merely buys the permission to ride between
certain points under certain conditions. He does not
buy an absolute right to that ride under all conditions,
simply because he does not pay what everybody else
has to for additional privileges. A man has no more
right to sell a conditional ticket which he has agreed
not to transfer than he has to ride in the drawing-room
car on an ordinary train ticket; or to ride on the plat-

2o8 GUNTON'S MAGAZINE [March,

form or engine, or to occupy half a dozen seats, or to
smoke in the regular coaches.

Suppose a man buys an excursion ticket at. a reduc-
tion of five dollars, on condition that he will not trans-
fer the ticket to anybody else. That is equivalent to
making a contract with the company that in considera-
tion of five dollars, value received, he will do or not do
certain things. What moral right has he to violate that
contract ? By selling the ticket he commits a deliberate
fraud upon the company, which in effect paid him not
to sell it. It is as if a man rented a house and grounds,
and in consideration of getting cheaper rent, agreed not
to keep animals or poultry on the place. He has not
bought any absolute right to do as he pleases on the
premises, but merely the right to live there under cer-
tain restrictions. Because he accepts those conditions
he gets a cheaper rent. If he wants the absolute right
to do as he will with the place, he must pay more rent,
or buy it outright.

Or, it is as if a man hires a saddle horse for the
season, and by agreeing not to use it for carriage driv-
ing gets it for considerably less money. It is just as
reasonable to argue that he has the absolute right to
use the horse for carriage driving as it is to say that a
man has a right to use a limited ticket which he has
agreed, in consideration of reduced fare, not to sell.

The case is exactly like that of commutation
tickets. Some people seem actually to believe that they
have a moral right to use a monthly commutation ticket
until all the rides are punched out, no matter when that
may be. They believe they are defrauded if any rides
are left unpunched, and the writer has known people of
unquestioned integrity to endeavor to use such tickets
beyond the time limit, and even to alter the date,
sometimes, justifying themselves on the plea that they
have paid for so many rides, and propose to have them

1 899.] THE ETHICS OF TICKET SCALPING 309

anyway. In reality they have done nothing of the sort.
What they have paid for is the privilege to ride a cer-
tain number of times within a given period of time. By
agreeing to that time limitation they obtain very great-
ly reduced rates, frequently two-thirds to three-fourths
less than what the regular fares would amount to during
the month. The company is under no obligation to
grant any such reduction at all. It does so with the
hope of securing a passenger for every week day in the
month. It could not possibly grant any such rate for
transient passengers, and if the time limit were not
enforced it would have to make a higher rate. The
matter is so clear as hardly to require argument. If
the commuter does not want to agree to surrender his
ticket at the end of the month, he can buy regular
tickets, the same as any other occasional passenger. It
is a perfectly legitimate and understood contract on
both sides. The company offers a large reduction on
tickets good one month only. If the traveler expects
to ride often enough to make the proposition profitable
to him, he accepts it and signs the agreement. If not,
he ought to know enough to buy single trip tickets
instead. He has not the slightest ground, either in
morals or in common sense, for claiming the right to
use a ticket of this character beyond its agreed limit.

In the case of purchasers of return coupons of iron-
clad excursion tickets, the fraud is direct and indefen-
sible. It involves the forgery of another's name, and a
lie, either outright or implied, to the conductor collect-
ing the ticket.

As to the grosser forms of fraud resorted to by the
more unscrupulous scalpers, little need be said, because
it is inconceivable that anybody not directly interested
should defend these. Nevertheless, it is fully proved
that the amount of dishonest tampering with tickets on
the part of scalpers every year is enormous. The ut-

2J«

GUNTON'S MAGAZINE

most ingenuity is displayed in plugging punched holes,,
altering dates, forging signatures, counterfeiting official
stamps, etc. Sworn testimony in abundance has been
laid before the Interstate Commerce Commission and
Congressional Committees illustrating these devices.
Most of the purchasers of such tickets are unaware of
the fraud, but if the conductor detects it the holder has.
no redress. He has simply been victimized, that is all.
Manipulation of the tickets in this manner is already
a criminal offence, but in the nature of the case it has
been practically impossible to convict anybody. This,
non-enforcement alone might not justify abolition of
ticket brokerage, were it not for the fact that the whole
business not only offers every inducement and tempta-
tion to fraud and breaches of contract, but provides the
one and one only safe and easy opportunity for the less,
reputable railroads to take secret advantage of the others,
or to violate the law in regard to publication of rates.
Moreover, its economic results are waste and discrimi-
nation.

The mere fact that abolition of scalping would be
a benefit to railroads ought not to affect the matter. If
it is morally and economically wrong it ought to be
abolished, no matter who benefits by its abolition. For
that matter, laws against stealing chiefly benefit finan-
cial institutions and rich people, but nobody argues,
against the laws on that account. Moreover, not all
the railroads want scalping abolished. Some of them
would be very hard pressed if they were obliged to do all
their business out in the open, with no secret advant-
ages. The more reputable companies have no means
of preventing these dodges on the part of those less
scrupulous. The roads desiring to carry on a legiti-
mate, responsible business must pay constant penalty
for so doing. It is always a part of good public policy
to make legitimate business possible at least, by pro-
tecting it from uneconomic and demoralizing influences.

SCIENCE AND INDUSTRY NOTES

The field of electricity as a source of motive power
is not necessarily limited to manufacturing industry.

On certain large estates in Germany suc-
Electricity - - .

in cessful experiments nave been tried in

Agncu ture operating pumps, threshing machines,

plows and other machinery by the electric power gen-
erated at a central station right on the estate. On the
Dahlwitz Farm, for instance, 250 acres are plowed per
annum, and the cost by electricity is considerably less
than by steam power. The method is rather peculiar,
but seems to have worked with entire satisfaction. A
motor, supplied with winding drums and carried on a
heavy wagon, is taken to the fields, and a rope runs from
one of the drums to a pulley at the opposite end of the
field, then back to the other drum ; to this rope the
plow is attached, and the plowman proceeds exactly as
though he were following a horse on the old fashioned
plan. It is said that experiments on the royal de-
mesnes, Sillium and Cloeden, have given similar re-
sults.

Some very interesting facts have been collected by

Electricity with reference to street railways in the United

Growth of States. It seems that in 1880 there were

Electric only 2050 miles of street railways in this

Railways country, and on substantially all of these

animal power was used. In 1890 we had 8123 miles of

street railway, of which 1260 miles were operated by

electricity. In 1897, according to estimates made by

the Street Railway Journal, we had 15,718 miles of

street railways, of which 13,765 were operated by

electric power. It is estimated that at the present date

we have about 16,300 miles, on 15,600 of which electric

power is used; and probably by the close of the century

211

212 GUNTON'S MAGAZINE [March,

we shall have 20,000 miles and very little animal power
used anywhere.

This is really a remarkable illustration of progress,
when we come to look at it. From 1880, when no
electric power at all was used in street railways, to 1898,
when almost all such roads are so operated, is only
eighteen years, and not only has the motive power been
revolutionized in that time but we have eight times as
many miles of roads as well. In all Europe, with
400,000,000 population, there are but 10,000 miles of
street railways, as compared with 16,000 miles for a
population of say 80,000,000 in this country. In other
words, one mile to every 40,000 inhabitants in Europe;
one mile to every 5,000 inhabitants in the United
States.

Agricultural prosperity is a question not of direct
encouragement to agriculture, but of better markets
How to f°r farm products. Now, agricultural

Help people are not the ones to furnish a mar-

Agriculture ket for agricultural products. The great
consumers of food stuffs are the employees in manufac-
turing industries, and, therefore, the great need of the
farmer is extension of manufacturing industries all
through the rural regions of the country. A writer in
the Manufacturers' Record urges this point, and, with
special reference to the South, suggests a scheme
whereby farmers themselves in that region would do
well to form joint stock corporations and establish
manufacturing industries, which would at the same
time create a demand for raw materials and bring fac-
tory laborers into the farm districts as consumers of
food stuffs. It is doubtful if farmers in the South have
sufficient surplus cash or time to devote to an outside
proposition like this and make it practically successful
on any very large scale. Something of the sort has

1*99-] SCIENCE AND INDUSTRY NOTES 213

been done in Minnesota, however, with reference to
creameries.

The important fact in the whole matter is, however,
that the factory is a necessary institution for the future
and continuing prosperity of agriculture. Solution of
western and southern problems will come largely by
the extension of manufacturing industries to those re-
gions. Probably, however, this will come more by out-
side capital being tempted into the field than by volun-
tary starting of enterprises by the present inhabitants.
It is in this way that the cotton industry of the South
is being built up. As the writer to whom we have re-
ferred says: "To encourage and promote agriculture
alone, without reference to the commercial and manu-
facturing interests, will be virtually not to encourage it
at all. To promote nothing but agriculture makes
farmers competitors of one another; to grow more prod-
ucts than can be sold is wasted work; to double the
products of the farm without providing markets for
them, is like erecting houses without a prospect for ten-
ants. The highest wisdom, therefore, suggests the
policy of increasing the number of productive consum-
ers who will engage in the manufacture of such articles
as the farmers need, and who will exchange these articles
for the products of the farm. This policy will give
constant markets to the farmers and to the manufac-
turer, without the intervention of anyone."

This point has an interesting connection with the
tariff question. Our protective system, by building up
and diversifying manufacturing industries, has tended
and is tending to create just this enlarging market for
farm products. It is because of this fact that the pro-
tective policy, so far from discriminating against farmers
and benefiting manufacturers at the expense of agricul-
ture, is a means of making the one possible and furnish-
ing a basis for the continued prosperity of the other.

CURRENT LITERATURE

THE STANDARD OF LIFE*

This book is made up, as are a great many books
nowadays, by the collection into one volume of articles
published separately, and often independently, in cur-
rent periodicals. The result is that it is a collection of
essays on kindred topics, rather than a treatise on a
single or even general topic. This is manifestly the
case with Mrs. Bosanquet's book.

Nevertheless, the vohime is very suggestive be-
cause it contains so many excellent things that seem to
have been bom of 'observation rather than of precon-
ceived theory. In her first chapter, "The Standard of
Life," from which the book takes its name, the author
suggests what is really a fundamental fact in all
societary life, viz: that the standard of life (that is, the
accepted standard of life) practically controls the action
of the citizen and largely of society itself. She also
brings out the idea, not sufficiently recognized, that in
the last analysis standard of life is closely associated
with employment. The fact which she does not elabo-
rate but which universal history teaches is that, for the
most part and especially in the more elementary stages
of progress, the social character, institutions and type
of civilization largely depend on the character of the
employment of the people. This is for the obvious
reason that the great mass of mankind devote most of
their time to getting a living, and hence the influences
which affect the intellectual, moral and social character
of the people and through these the institutions of the
country, are necessarily the forces with which they come

* The Standard of Life, and Other Studies. By Mrs. Bernard
Bosanquet, author of "Rich and Poor." The Macmillan Company,
London and New York. Cloth. 220 pp. Price $i. 50.

214

THE STANDARD OF LIFh 215

in contact incidentally, though perhaps regularly, while
going about their business. It is always the forces
which unconsciously operate with more or less silent
continuity that actually affect the lives and habits of
the people.

She endeavors to trace the existence of different
classes in the community as resulting from the different
social functions they perform or occupations they fol-
low. In proof of this general view she cites the life
of the Bulgarian peasant as given in Dicey 's ' ' The
Peasant State." This author gives an account of an
agent of an English mercantile firm who tried to in-
troduce his business in Bulgaria, and, though he had been
very successful elsewhere, had to report his utter failure.
" When asked for the reason of his failure, his explana-
tion was that the great mass of the people had absolutely
no wants which they could not satisfy for themselves."
In proof of this he gives a vivid description of how
the Bulgarian peasant lives. He says : — " The average
cost of a peasant's daily sustenance does not exceed
twopence. His food during the greater part of the
year consists solely of bread and garlic. Their only
beverage is water ; not that they have any objection to
beer or spirits, but because they object to paying for
them. Sheep-skins, provided in most cases from their
flocks, form the universal dress of the peasantry. The
clothes of both men and women are home-made. Com-
monly they only possess one suit, and they sleep at night
in the same clothes as those which they wore during
the day. Their beds are mattresses laid on the mud
floors of the rooms where they have their meals. On
these mattresses the whole family lie huddled together. "
This surely is an adequate explanation of why the
English merchants could do no business among the
Bulgarians. During the next few years some of our
American drummers will have similar explanations for

216 GUNTON'S MAGAZINE [March,

their failure to get liberal orders in the Philippines.
With this kind of life, having no new wants, the stand-
ard becomes stereotyped and progress almost impossi-
ble. Nothing can really force a higher standard of life
among the Bulgarian peasants which does not introduce,
in spite of them, diversification of industries. So long
as they all work alike and live alike they will feel and
think very nearly alike, and new ideas will be in-
tolerable innovation. In this our author has surely
struck a fundamental sociological truth, and if the book
had contained nothing else it would have been worth
publishing. She recognizes the fact that discontent is
a wholesome influence in society, — in fact, that it is the
initiatory force of progress. One of her criticisms of
the English public house (and it is an English book) as
the poor man's club is that it tends to " make its fre-
quenters comfortable for the time, without arousing a
desire for anything more." It is the contact with the
new that sets in motion forces which raise the standard
of life.

In her chapter on ' * The Psychology of Social Prog-
ress " the author also recognizes what is too frequently
omitted in sociological considerations, — the importance
of habit as a conservative force in society. What has
been habitual until it has become established, the
people will advocate. Not even monarchs can defy the
habits of their people. If a high standard of life and
civilization can, therefore, become general and habitual,
the energies of the entire people can be enlisted to
defend it, even by war or revolution if needs be.

In this chapter she also makes a very wholesome
suggestion which social reformers would do well to take
to their souls, viz: that successful reforms in society
must always be accomplished by engrafting small
branches of new on large trunks of old habits, institu-
tions and methods. She passes a very wholesome crit-

1859-1 THE STANDARD OF LIFE 217

icism on many of the reform efforts, particularly among
laboring class movements, which, as she observes, gain
their influence over the masses, "not by presenting
them with wider issues and stronger sympathies, which
would enable them to harmonize their lives with that of
the community, and so to share in as well as to advance
its progress; but by concentrating the attention of the
class upon its narrower self, and by exciting disintegrat-
ing emotions." This is the most vital criticism to be
made on all such movements as socialism, single tax,
populism, etc. The chief burden of the propaganda of
such movements is to turn the attention of the class not
upon its normal relations with society and the possi-
bility of its elevation and progress, but to make it brood
over its own disadvantages and look only to the disrup-
tion of society as a remedy. Every movement which
rests primarily upon this idea is a disintegrating rather
than an integrating force in the community. As the
author well says in the conclusion of this chapter : * ' The
growth of wider interests should mean, not the suppres-
sion, but the fuller development of narrower ones; and
what is needed in social as in individual life is the in-
troduction of organizing and not of disintegrating
ideas."

ADDITIONAL REVIEWS

POEMS BY RICHARD REALF, With Memoir by Rich-
ard J. Hinton. P\mk & Wagnalls Co., New York and
London. 232 pp. Four tinted photogravures. $2.50.

Richard Realf is an unfamiliar name to the present
generation, but was not at all so during the decade
after the close of the Civil War. He was an eloquent,
warm-hearted, eccentric genius, unfortunate in the pos-
session of a vacillating temperament and too impressiona-
ble character; but nevertheless he produced enough real-
ly creditable verse to warrant the task Mr. Hinton set
himself in preparing this compilation. It has been a
work of twenty years to gather the scattered materials
of Realf s literary career, and only recently has it been
possible to consider the work fairly completed. Realf
committed suicide in San Francisco, in 1878, the result
of long-continued domestic infelicities. The book is
very finely printed on heavy antique paper, with four
excellent tinted photogravures, and in a sense might be
called a testimonial to the unfortunate poet from his
friend.

THE PHILIPPINE ISLANDS AND THEIR PEOPLE. By
Dean C. Worcester. The Macmillan Co., New York.
Quarto. 529 pp. With map and illustrations. $4.00.

The author is Professor of Zoology in the Univer-
sity of Michigan, and has made two extensive tours of
the Philippine Islands, the last one extending from the
summer of 1890 until early in 1893. It is by far a more
comprehensive and apparently authoritative and reliable
description of the Philippines than any we have yet seen,
and is beautifully printed, on a fine quality of paper
and handsomely illustrated. The author travelled per-
sonally with a number of other explorers, and native
guides, through most of the principal islands in the

218

ADDITIONAL REVIEWS 219

archipelago, making careful notes and many photo-
graphs. His ability to speak with authority on this
topic has recently been recognized in his appointment
by the President as one of the special commissioners to
visit the Philippines and report on the conditions there
existing. He describes at length not merely the phy-
sical and geographical aspect of the Philippines, but
the character of the motley collections of people that
inhabit them, and the corrupt political machinery under
which affairs have been administered.

There is an appendix giving valuable statistical in-
formation on points of importance, such as climate,
agriculture, forest products, animals, fishes, etc., trans-
portation, minerals, labor and manufactures. " Cigars,"
he says, "are the only manufactured article exported
in any quantity. In fact, outside of the products of the
tobacco factories, the Philippines can hardly be said to
have any manufactures worthy of mention, although
fabrics of several sorts are woven on simple hand looms. "

What he says about wages is very interesting, not
merely because it happens to be in the Philippines 'but
because it illustrates some of the general laws that
govern wage rates everywhere. An interesting point
is that in any large enterprise in the Philippines, requir-
ing the employment of a great many men, labor is very
difficult to get; yet, despite this fact, wages are only
about four to eight dollars per month. In other words,
it is the laborers' standard of living and not the supply
and demand that determines the wages. This is so
completely true that even where the employers offer
the laborers higher wages to induce them to work, they
will lay off when they have earned a certain amount
and refuse to work until their accumulations are ex-
hausted. This tallies exactly with the experience of
Sir Thomas Brassey in building railroads in India, years
ago. "In some islands," says Professor Worcester,

220 GUJVTON'S MAGAZINE [March,

' ' laborers cannot be had at all, unless they are imported,
and in any event it is usually necessary to make them
considerable advances on salary account before they will
do any thing. " In the appendix he remarks that ' ' the
laborer is indisposed to exert himself unnecessarily, and
is apt to relapse suddenly into idleness when he has
accumulated a small sum in cash."

When we contrast this condition of affairs with the
fact that there is generally a considerable class out of
employment and seeking work here in the United States,
and yet wages are from ten to twenty times as high as
in the Philippines, where it is difficult to obtain labor,
it becomes plain that it is not mere supply and demand
of laborers that determines wages. This is one of the
points in the book of interest to economic students,
aside from the many others of more particular interest
to those who are studying the future of the Philippines
with reference to their possible connection with the
United States.

NEW BOOKS OF INTEREST

CIVIC AND POLITICAL

Democracy in America, by Alexis de Tocqueville.
Introduction by Daniel C. Oilman, president of Johns
Hopkins University. 2 vols. The Century Co., New
York. A new edition of this author's famous commen-
tary on American conditions as they were three-quarters
of a century ago. $5.

Anglo-Saxon Superiority. To What it is Due. By
Edmond Demolins, editor La Science Sociale. Translated
from tenth French edition. Charles Scribner's Sons,
New York. Cheaper edition, $1.00. Coming from a
Frenchman, this is a remarkably frank and discerning
analysis of the causes of Anglo-Saxon progress and the
relative decline of the Latin races.

NEW BOOKS OF INTEREST

221

HISTORICAL AND DESCRIPTIVE

The Beginnings of New England, by John Fiske.
Houghton, Mifflin & Co., Boston. A new illustrated
•edition of a standard historical work.

The Story of France, by Hon. Thomas E. Watson.
The Macmillan Co., New York. 2 vols. The former
Populist leader has turned his hand to historical work,
and the first volume of his history, covering the period
from the settlement by the Gauls to the death of Louis
XV, is now ready. Perhaps the feature of special in-
terest is the large place given to the conditions of the
laborers and common people.

Campaigning in Cuba, by George Kennan. The
Century Co., New York. i2mo. 268pp. $1.50. Mr.
Kennan was the Outlook's war correspondent in Cuba,
and was likewise associated with the Red Cross work.
His Siberian articles of a few years ago demonstrated
an exceptional capacity for such work as is undertaken
in this book.

The Story of the People of England in the Nineteenth
Century, by Justin McCarthy, M.P. 2 vols. Illus-
trated. 294+272 pp. $1.50 per volume. G. P. Put-
nam's Sons, New York and London, 1899. Mr. Mc-
Carthy records the industrial and social, more particu-
larly than the political, progress of England since the
close of the Napoleonic Wars; showing both the men
and the movements that have produced the develop-
ment in English civilization in this century.

LITER A TURE

The Life and Letters of Lewis Carroll, by S. D. Col-
lingwood. The Century Co., New York. 500 pp. 100
illustrations. $2.50. Lewis Carroll's real name was C.
L. Dodgson, and this biography is written by his
nephew. It consists largely of Carroll's letters to his
children, extracts from his diary, etc. , and it will have
a large sale if it reaches only a small percentage of those

222 GUNTON'S MAGAZINE

who have been entertained by the droll absurdities
of ' ' Alice in Wonderland. "

Ruskiris Letters to Rossetti and Others. Dodd,
Mead & Co., New York. $3.50. Brings one nearer to
the author's personality, but naturally is of less perma-
nent value than his direct contributions to the literature
of specific topics.

Biographical Edition of Thackeray. This new edi-
tion of Thackeray is now being published by Harper
& Bros., in thirteen volumes, uncut edges, gilt tops,
and finely illustrated, at $1.75 per volume. It is
unique in that it contains what is probably the nearest
approach to an authorized biography of Thackeray that
will ever be published, in the shape of an introduction
to each volume by his daughter, Mrs. Anne Thackeray
Ritchie. Eleven volumes are now ready. The March,
publication is " Denis Duval, Etc." and the April,
''Miscellanies."

The Works of William Black. -Harper & Bros., New
York. This is an illustrated library edition in twen-
ty-eight 1 2 mo volumes; cloth bound; most of the
volumes at $1.25 each, the set $33.50. Includes his
latest book, " Wild Eelin," $1.75. Since the death of
Black there has been extensive discussion of the
character and permanency of his place in literature, and
hence this complete edition of his works is timely.

The History of Japanese Literature, by W. G. Aston,,
late Japanese Secretary to the British Legation at Tokio.
D. Appleton & Co., New York. i2mo. Cloth. $1.50.
This is a new volume in Appleton's ' ' Literature of the
World Series. " The author makes it a special point to
bring out the individual characteristics of Japanese
literature, as distinct from the Chinese and Buddhist
influences embodied in it.

THE BEST IN CURRENT MAGAZINES

Professor Edmund J. James, of the University of
Chicago, contributed an exhaustive statistical article on
"The Growth of Great Cities," in Europe and the
United States, to the last bi-monthly issue (January) of
the Annals of the American Academy.

In the March Cosmopolitan, Speaker Reed has a
short article on "Richard Brinsley Sheridan," the
famous playwright of a century ago, author of " The
Rivals," " The School for Scandal," etc.

The third installment of Mr. Howells' novel "Their
Silver Wedding Journey" appears in theJMarch Harper s.
There is an interesting article on " English Character-
istics," by Julian Ralph.

George Ethelbert Walsh describes " An Electrical
Farm " in the New England Magazine for March, and
there is an illustrated article on ' ' Portraits of Walt
Whitman," which will interest all Whitman lovers.

Among the many good features in the March
Century is a contribution from James Bryce on ' ' British
Experience in the Government of Colonies," also
"General Sherman's Tour of Europe, "^as described in
extracts from his diary.

Professor John Fiske tells of ' ' Some Cranks and
their Crotchets," in the March Atlantic; and John
Burroughs writes on "The Vital Touch in Literature."

In the March Engineering Magazine, W. Henry
Hunter points out the ' ' Uncertainties and Difficulties
of the Maritime Canal Company's Project."

McClures has in its March number an article on
"Lincoln's Method of Dealing withj Men," by Ida M.
Tarbell, author of the Life of Lincoln which appeared
in McClure's two or three years ago.

Governor Roosevelt, Senator Hoar, and George
W. Cable are conspicuous contributors to the March

Scribner's.

923

INSTITUTE WORK

CLASS LECTURE
COMMON SENSE ON MONEY

In discussing money we hare at least three impor-
tant questions to answer. First, what is money ?
Second, how is the value of money determined ? Third,
what is the essential difference between metallic money
and paper money?

The so-called ' * sound money " advocates are in the
habit of regarding only standard coin as money, like
gold in gold-standard countries and silver in silver-
standard countries. This leads to the idea that the
money of a country must needs be metallic, and those
who are opposed to the gold standard at once say there
is not gold enough in the world to furnish money to do
the business of modern society, which of course would be
obviously true if only metals were money. But, these
same people insist that money is whatever is stamped
by the authority of the government as legal tender,
and that the value of this instrument is determined by
the government edict. The error in this is easily ex-
posed by the sound money people, and thus the con-
flict goes on, because neither is reasoning from clearly
stated facts in the case.

Now, if we will apply a little ordinary observation,
coupled with unbiased sense, to the subject, it will be
easy to see that money is not necessarily either the one
or the other of these two things. The best way to find
the character of a thing usually is to know what it does,
and why it comes into existence. Money came into ex-
istence solely to facilitate the exchange of commodities
when swapping or bartering became embarrassingly in-
convenient. If a person has an article that another de-

224

COMMON SENSE ON MONEY 225

sires, but that other has nothing that he can give in
exchange for it that the owner of the article cares to
accept, something mutually acceptable is required to
complete the transaction. In order to facilitate the ex-
change, therefore, if the party desiring the article has
nothing that its owner needs,, then this owner must be
given something that somebody else will take in ex-
change for things he does need.

The essential function of the money, therefore, is
to facilitate the exchange of consumable goods and ser-
vices. Hence it must be something that will always be
honored or accepted throughout the community as a
valid certificate of credit. Strictly speaking, then,
money is a circulating certificate of credit.

What the money is made of depends very largely
on the civilization of the community. Almost every-
thing conceivable has been used for that purpose, but
gold, silver and paper are the chief materials used in
modern society. Take the metallic coins, gold or sil-
ver, where they are respectively the standard money.
The gold or the silver is not the money. It is only the
material of which that money is made. Why is it made
of gold ? someone may ask, or of silver ? If we search
close enough into the history and facts of the case, we
shall find that it is because the people would not accept
as money, or token, of credit, anything which did not
have the full value of the property represented in the
money itself, so that, if the money was converted into
bullion, it would be worth just as much as the potatoes
or whatever for which it had been received. The gov-
ernment stamp on the money has nothing to do with
this, except that it guarantees, just as it does in the case
of weights and measures and the length of the yard-
stick, that in quality and quantity it is what it pretends
to be. The value of the gold or silver coin is deter-
mined by exactly the same means as is the value of the

226 GUNTON'S MAGAZINE [March,

potatoes or the shoes or coats for which it is given. It
will not buy more or less of a commodity because it
has the government stamp, except to the extent that it
gives confidence that it is not a fraud, and may to that,
extent remove a hesitancy to accept it. The govern-
ment stamp merely guarantees that the coin is genuine
metal of a certain weight and fineness.

As a matter of fact, however, in modern society,
and particularly in Europe and the United States, there
is metallic money which does not contain the full face
value it represents. This is true of all English silver
and copper coin, as it is of American dollars, half
dollars and subsidiary coins. Just why the silver dollar,
containing less than fifty cents' worth of metal, twenty
nickels containing only about ten cents' worth of metal,
and one hundred coppers containing only about eight
cents' worth of metal, all circulate as the equivalent of
the gold dollar containing 100 cents' worth of metal, is.
a question around which much confusion has arisen.
The fact that these silver, nickel and copper coins will
circulate at par with the gold dollar, when the metal in
these minor coins would not exchange for the metal in
the gold if they were not coined,. seems to lend color to-
the idea that the government stamp gives the value to.
the money, and indeed it is given as conclusive evidence
of this contention. In reality, however, the govern-
ment stamp does not do anything of the kind. The
uniformity of value between these different coins is the
result of economic and not political law. It is simply
a part of that universal law of prices which tends to-
make the price of competing portions of the same thing
uniform; as, for instance, in Worth Street where cotton
cloth from scores and hundreds of different factories all
comes into the same warehouses and will sell at the
same price, for similar grades, regardless of the differ-
ent conditions under which the output of the different

I899-] COMMON SENSE ON MONEY 227

mills is produced. This uniformity of price, for reasons
frequently explained in these pages, tends to gravitate
towards and is always very near to the cost of furnish-
ing the most expensive portion of the cloth needed. The
price does not vary according to the different costs of
production in the different mills, but it tends to uni-
formity at the cost of the output of a certain group of
the mills whose expense is the greatest, and this for the
obvious reason that these mills could not continue to
furnish the cloth unless the cost of their output was
covered in the price. What their cloth must bring the
similar cloth of the other mills will bring; and hence
the uniformity of price at the point of the most expen-
sive part of the necessary supply.

Now, the value of different coins is subject to the
same law. These coins, from the copper pennies to the
gold dollars, for the purposes of money fill the same
function and render exactly the same service, though
the cost of furnishing each class differs, the pennies
being the least, nickels next, silver next and gold the
dearest. So long as they all are required in the busi-
ness of the community, and circulate together, they
will all have an uniform value as money. It will not
be at the value of the coppers that they will circulate,
nor of the nickels, nor of the fractional silver, nor of
the silver dollar, because there is still another coin that
is circulating with them whose cost of production is
much greater, — the gold. Consequently, so long as.
they all are required in the circulation they will all have
the value of the dearest and hence be equal to the gold.
If the gold should for any reason be withdrawn, whether
by competition or law, the value of all the rest would
fall to that of the next dearest, which would be the
silver dollar. It is for this reason that in countries
where gold is not the standard money, and the dearest
standard money is silver, the silver dollar is worth only

228 GUNTON'S MAGAZINE [March,

what is equivalent to its bullion value. Thus the Mex-
ican dollar is now worth a little less than half the Amer-
ican dollar, though it contains a few grains more of
silver. The obvious reason for this is that the value as
money of the American silver dollar is determined, not
by its own cost of production, but by the cost repre-
sented in the gold dollar, which is the most expensive
of the group of coins used as money.

The question here is, why does the gold stay in
circulation when silver is so abundant and so much
cheaper? The only reason is that law has prevented
the coinage of enough silver to do the whole business.
Gold is needed, and, so long as gold is needed to make
up any portion of the general metallic money, the value
of all will be equal to that. If silver were admitted to
free and unlimited coinage there would very soon be
•enough silver to do the whole monetary business, and
gold would not be needed and would soon disappear. This
is by virtue of what is called the "Gresham Law," that
free coinage of cheaper metal will drive out the dearer.
In order to prevent this, it is necessary that the cheaper
metal be limited in coinage to an amount that will cause
the dearer (in this case, the gold) to be still necessary;
or else, if the cheaper metal is admitted to free coinage
it must be coined at a ratio at which it shall contain
enough metal to constitute the same bullion value as in
the dearer or gold dollar. If the metallic value of the
two is the same, neither will drive the other out and
they may be put in free competition with each other,
but if either one contains less metal value it will drive
the other out if admitted to free competition; which
would seem too simple and obvious not to be under-
stood. That is why, when the value of silver began to
fall, free coinage was impracticable unless we were will-
ing to depart from the gold standard. Nobody would
dispute for a moment that if free coinage were given to

1899. J COMMON SENSE ON MONEY 229

coppers the mints would soon be loaded up with copper
enough to furnish the entire metallic currency, and sil-
ver and gold would become unnecessary and disappear;
because in the meantime the profits on copper would be
so enormous that everybody would want to go into the
business.

Paper money is essentially different from any of
the coined money. Coined money circulates on its bul-
lion value, the value of the whole being governed by
the value of the dearest. Paper money is not property
money at all, but representative money. It does not
contain the wealth but represents it. The property is
not in it but behind it. It circulates instead of prop-
erty. The value of paper money, therefore, is deter-
mined by a different process than the value of inferior
coins. Representative money is really a circulating
certificate of credit. It passes from hand to hand
throughout the community solely on the confidence the
people have that it does represent its face value in
wealth. In order that this confidence may be kept up
it is necessary to test the paper money occasionally, —
indeed, quite frequently, — by calling upon the parties
who issue the paper or representative money to redeem
it in property. Any kind of property will not do for
this purpose. Potatoes, shoes, clothing, furniture, will
not be accepted in redemption for this money, for the
same reason that they could not be exchanged in trade.
The property that paper money represents must itself
be capable of doing the work of money; so that, when
a representative dollar is presented for redemption, the
redemption must be in metallic money, gold or silver,,
or whatever happens to be the standard of the commu-
nity in which the paper or representative money circu-
lates, because that is the only property that will itself
circulate.

There are two kinds of paper money; one that is

230 GUNTON'S MAGAZINE [March,

legal tender and one that is not. Legal tender money
is usually money issued by the government, as the
continental money of the American revolution and the
greenbacks of the civil war; considerably over $340,-
000,000 of the latter is still in circulation. The dis-
advantage of legal-tender paper money is that it is not
subject to redemption. It has to be accepted on the
faith of the government everlastingly, with the result
that there is danger of its going to a discount (which is
usually called putting gold at a premium) whenever the
credit of the government is disturbed. In the case of the
continental legal-tender currency, the government's
capacity to redeem was so doubtful that the value of
the paper money fell to one cent on the dollar, at which
price it was finally redeemed. The confederate money
during the civil war was another instance of the same
kind. It was made legal tender by law, and after Lee's
surrender it became absolutely worthless, because it
was issued as legal-tender money backed, not by prop-
erty and subjected to redemption in property money,
but by the edict of the government. The greenbacks
issued by the United States during the same civil war
were of the same character. They were not subject to
redemption in full value metallic money, but they rested
wholly on confidence in the government. Consequently,
their value rose and fell with the fortunes of the Union
army. When the Union arms were finally successful, con-
fidence in the government increased, but it was not pre-
pared to redeem its promises in full value property
money, and consequently the greenbacks were still at
a discount and remained so until 1879, when the govern-
ment agreed to redeem them in gold; and that moment
the confidence of the community rose and the value of
the greenbacks became the same as that of gold.

This shows that the government is powerless to
give value to representative money except to the ex-

1899-]

COMMON SENSE ON MONEY

231

tent that it stands ready to redeem it in full
value property money. For that reason it is safe to
•say that, except in national crises like revolution
and war, paper money should never be issued by the
.government as legal tender. That is properly the
function of banking. If all paper money is issued
by banks, and made subject to constant redemp-
tion or conversion into coin, then the issuing of
representative money becomes a business, subject to
business and economic conditions, which it is not prop-
erly the function of the government to assume.

One of the most important features in banking is
the ability of the banks to loan money cheaply to the
business community, under conditions that shall give
adequate security that the paper money thus issued and
loaned shall always be worth its full value in business
circulation. The cheaper this paper money can be
issued, the lower, with adequate security, can the rate
of interest be to borrowers. Our present national banks
are about as far as possible removed from this point of
ideal banking, because they are permitted to issue paper
money only on the deposit of government bonds which
cost from $11 5 to $120 for each $100 worth, and this
only gives the right to issue $90 of notes; so that, about
$120 or $125 has to be invested in order to secure the
right to issue $100 worth of bank notes. This makes it
very expensive, and consequently bank note circula-
tion is relatively diminishing, because it does not pay.

It is to remedy this that the present banking bills
before Congress have been introduced, one by Secretary
Gage, the other by the Banking Committee. It is a
settled principle, derived from the experience of cen-
turies, that in order to preserve the community from
money stringencies, and keep the rate of interest
reasonably low, paper money should expand and con-
tract with the commercial needs of the country. There

232 GUNTON'S MAGAZINE [March,

should not be such a large amount of paper money as
to create a redundance at certain times, when the mini-
mum amount is required, nor so small a volume as to
create a stringency at the period when the maximum
amount is needed. Universal experience has taught
that a fixed volume of currency, therefore, is sure to
furnish too much at some times and too little at others;
and, since government paper money does not contract
or expand according to business needs, but is fixed in
volume, like coin, and of doubtful value except as pub-
lic confidence in the government is wholly undisturbed,
it lacks the essential quality of good paper money.

To insure this elastic quality in the issue of paper
money it must not be legal tender, but must always be
subject to redemption either when doubt arises or de-
mand for its use diminishes. This can never be safely
accomplished through government issues, but only
through non-legal-tender bank issues. The principles
underlying good banking existed in the first and second
Banks of the United States, and in the Suffolk Bank of
Boston. They exist to a high degree in the banking
systems of Canada and of Scotland, and to a consider-
able degree in the Bank of England. Under these
systems the banks have the right to issue paper money
against the capital and assets of the bank, including the
deposits. In order to secure the community against in-
flation and the depression of the notes thus issued, the
banks must ever stand ready to redeem these notes in
gold whenever presented. Moreover, in order to give
the maximum security to this, the banks must not be
individual, segregated from each other, standing iso-
lated and alone, but must be co-ordinated, and the notes
of the banks in a common district be redeemed through
some selected strong bank as the redemption center.
All the banks receiving the notes of any other bank
should be able to send them every day to the redemp-

i899-] COMMON SENSE ON MONEY 233

tion center, which immediately calls upon the bank
issuing the notes to redeem them, and thus the test is
applied to the ability of the bank to redeem its notes
every day. The first failure to redeem a note closes
the bank, and puts all its assets and deposits in the
hands of a receiver, and they are held to redeem the
notes of the bank. Moreover, the capital of all the
joint banks in the district should be held to the security
of the notes of each of such banks, as under the branch
bank system. In this way all the banking capital of the
community is really behind every note that is issued,
and is a better security for the notes than any govern-
ment pledge could ever be under any circumstances;
because it is impossible for all the banks to fail at once,
unless the nation collapses.

If Congress passes a banking law with this feature
well developed, the United States will have as good a
banking system as there is in the world, — as good as it
had under the first Bank of the United States, estab-
lished by Hamilton. We may then expect that the
money question will pass out of politics; but until some
sound system of banking is adopted, which shall give
elasticity to the issue of paper money, and the security
furnished by constant coin redemption, we may expect
panics every time a little industrial disturbance arises,
and greenbackism, silverism, or other monetary agita-
tions returning into national politics, to the constant
menace of industrial stability and business prosperity.

WORK FOR MARCH

OUTLINE OF STUDY

Our March studies cover the subjects of Money
•and Banking, sub-divided in the curriculum as follows:

VII. Money.

a Metallic money.
b Paper money.

c History and theory of Bimetallism.
d History and theory of Monometallism.
e Free coinage of silver.
f Fiat paper money ; (Greenbacks).

VIII. Banking.

a Banking experience in United States.

1 New England Banks (The Suffolk).

2 First and Second Banks of United States.

3 State Banking system.

4 Sub-treasury system.

5 National Banking system.
b English Banking system.

c Canadian Banking system.

d Banking in France and Germany.

e Banking reform.

REQUIRED READING

In " Principles of Social Economics," Chapter VI
of Part II. In GUNTON'S MAGAZINE for March, class
lecture on " Common Sense on Money; " also Notes on
Required and Suggested Readings. In GUNTON IN-
STITUTE BULLETIN No. 22, lecture on " American
Social Reform Movements."

SUGGESTED READING *

In Del Mar's " History of Monetary Systems,"
Chapters I, V, VI and XX. In Jevons' '.' Money and
the Mechanism of Exchange," Chapters III to VIII

* See Notes on Suggested Reading for statement of what these ref-
erences cover. Books here suggested, if not available in local or trav-
eling libraries, may be obtained of publishers as follows :

History of Monetary Systems, by Alexander Del Mar, M. E. Effing-
ham Wilson, Royal Exchange, London, Eng. 511 pp. 155. net.
Money and the Mechanism of Exchange, by W. Stanley Jevons, M. A.,

234

WORK FOR MARCH

235

inclusive, and Chapters XII, XV and XXVI. In
Laughlin's " History of Bimetallism in the United
States," Chapters II and VII of Part I; also, the whole
{two chapters) of Part III. In Giffen's " Case Against
Bimetallism," Chapters I, II, VI and IX. In White's
11 Money and Banking," Book II. In Conant's " History
of Modern Banks of Issue," Chapters IV, V, XIII, XV,
XVI and XXIII. In Noyes' ' 'Thirty Years of American
Finance," Chapters VI to X inclusive. In the SOCIAL
ECONOMIST (now Guntons Magazine) articles on "Path
to Safe Banking and Currency," October 1893; and
" Our Banking and Currency Plan," January 1895.
Articles in GUNTON'S MAGAZINE as follows: "Retire
the Greenbacks Without Issuing Bonds," January 1896;
" Professor Gunton's Address," " Fallacies about Gold
and Silver," and " Some Questions on Silver Answered,"
September 1896; " Economic Effect of Appreciating
Money," October 1896; " A Texas View of Gold Ap-
preciation," December 1897. For concise description
and explanation of the monetary and banking systems
in the principal countries of the world to-day, students
are referred to the small volumes, " Monetary Systems
•of the World," by Maurice L. Muhleman, Deputy As-
sistant Treasurer of the United States ; and ' ' Banking
Systems of the World," by William Matthews Handy.

F. R. S. D. Appleton & Co. , New York. 350 pp. $1.75. The History
«of Bimetallism in the United States, by J. Laurence Laughlin, Ph. D.
D. Appleton & Co., New York. 258 pp. $2.25. The Case Against
Bimetallism, by Robert Giffen. George Bell & Sons, London, Eng.
.254 pp. $2.00. Money and Banking, by Horace White. Ginn & Co. , Boston
and New York. 488 pp. $1.50. A History of Modern Banks of Is-
sue, by Charles A. Conant. G. P. Putnam's Son's, New York and
London. 596 pp. $3.00. Monetary Systems of the World, by Mau-
rice L. Muhleman. Charles H. Nicoll, 189 Broadway, New York. 198
pp. $2.00. Banking Systems of the World, by William Matthews
Handy. Chas. H. Kerr & Co., Chicago. 190 pp. $1.00. Thirty
Years of American Industry, by Alex. Dana Noyes. G. P. Putnam's
Sons. 278 pp. $1.25.

236 GUNTON'S MAGAZINE [March,

NOTES AND SUGGESTIONS

Required Reading. The chapter assigned in ' * Princi-
ples of Social Economics " this month is on * ' Money
and its Economic Function." Professor Gunton first
makes a careful analysis of the nature of money and

defines it as ' * the medium through which

economic exchanges are facilitated by giving currency
to credit and substituting obligation for present pay-
ment." Thus money does not necessarily imply the
idea of a metallic coin ; indeed, the metal is simply a
sort of property guarantee accompanying the money,
and as civilization advances the proportion of money in
which this property security is necessary diminishes,
and a larger and larger proportion of exchanges are
effected by paper money and instruments of credit.
Mr. Gunton then goes on to discuss the merits of
various metals as standards of value, and points out the
essentials of a sound monetary system. Unfortunately
there is no chapter on banking in this book ; it is possi-
ble that one will be incorporated in future editions.
However, the class lecture in this number has a discus-
sion of the banking question, and there is considera-
ble historical matter along the same line in the Bulletin
lecture on " American Social Reform Movements."

Suggested Reading. Del Mar's ' * History of Mone-
tary Systems" is an exhaustive treatment of the origin
and development of money from the earliest times, in
the ancient civilizations, and then in various modern
countries up to the present day. Of the four chapters
we have designated, two treat historically of money in
ancient India and under the Roman Republic and
Empire ; the third discusses ' * The Sacred Character of
Gold," and the fourth (which is Chapter XX, the last
in the book) is on " Private Coinage." The chapter on
" The Sacred Character of Gold " is interesting, in that it
shows how, under Rome, the force of sacerdotalism and

I899-] WORK FOR MARCH 237

superstition availed to keep gold at a much higher ratio
to silver than it could have had under normal economic
conditions.

The chapters suggested in Jevons cover the func-
tions and early history of money, the use of various
metals as money, coins and coinage, and the way in
which money circulates; also, in Chapter XII the author
discusses the single and double standard, and disadvan-
tages of the latter; Chapter XV is on " The Mechanism
of Exchange," and treats of representative money,
checks, clearing houses, etc. In Chapter XXVI, the
last in the book, the author takes up the question of
"The Quantity of Money Needed by a Nation," and
shows that this is entirely an uncertain and varying
amount which nobody is capable of estimating or
determining. It is in a general way proportionate
to the population, complexity of business interests, and
volume of exchanges, but on the other hand is largely
dependent on the rapidity of circulation of the money in
use, and the proportion of exchanges effected by checks
and other private instruments. As the author says:
"So different, then, are the commercial habits of dif-
ferent peoples that there evidently exists no proportion
whatever between the amount of currency in a country
and the aggregate of the exchanges which can be effect-
ed by it." Manifestly this is true, and therefore it is
clearly impossible to prove that either a fall or rise of
prices is due to small or large supply of metallic
money in the community.

In Laughlin's "History of Bimetallism in the
United States," the chapters suggested treat of the first
establishment of coinage and a coinage ratio between
gold and silver under our constitution, and our early
experience with the two metals; then the so-called
"demonetization " of silver in 1873, its effects, and the
charge that it was done surreptitiously; finally, the

3 8 GUNTON'S MAGAZINE [March,

history of the Bland law of 1878, and a statement of
"The Present Situation" (1886), showing some of the
causes that keep the silver dollar at par with gold. The
economic cause for this maintenance of silver, however,
is more satisfactorily stated in the class lecture this
month.

"The Case Against Bimetallism," by Sir Robert
Giffen, the well-known British statistician and economic
writer, is a standard handbook of single gold-standard
argument. The chapters suggested cover, respectively,
"The General Case against Bimetallism," "Some Bi-
metallic Fallacies, " ' 'The Alleged Bimetallism of France,
1803-73," and "A Chapter on Standard Money." The
bimetallism which Giffen attacks is, of course, the
system of free coinage of two different metals; not the
bimetallism which prevails here, where the coins of one
metal are restricted in quantity.

Book II in White's " Money and Banking " gives-
the history of banking institutions in this country, from
colonial times down to the present, including the two
Banks of the United States, the wildcat era, and the
national banking system. Mr. White also describes the
functions of a bank, the clearing house, and the gen-
eral mechanism of exchange. The first part of this-
volume is devoted to a theoretical and historical discus-
sion of the money question, but, as this is well cov-
ered in our other readings, the section on banking
is more particularly recommended. This book and
Mr. Del Mar's "History of Monetary Systems" were
reviewed in GUNTON'S MAGAZINE for February, 1896.

The chapters suggested in Mr.Conant's book cover
the history of the Bank of England, the Bank of the
United States, the American National Banking System,
and a description of the excellent and famous Canadian
banking system. This last chapter is especially im-
portant. To study the Canadian system is almost in it-

1899.] WORK FOR MARCH 239*

self an education in sound principles of banking and
currency, and brings out in clear light the necessity of
substituting scientific banking for our own crude, ex~
pensive and inelastic system.

Noyes' ' 'Thirty Years of American Finance" is the
most recent history of our financial experience since
the Civil War. It begins with the inflation period,
covers the resumption of specie payments, subsequent
silver legislation, the panic of 1893, and government
bond sales, bringing the record down to 1896. The
reading we have suggested begins with "The Two Laws*
of 1890," and continues to end of book.
LOCAL CENTER WORK

Local Centers will find little trouble in preparing
programs on the money question. We would suggest:.

Papers on: Money — coin and credit; Private substi-
tutes for money; Facts about gold and silver; The
present monetary system of the United States; Theory
of bimetallism; Has gold appreciated and so caused
prices to fall? Probable effects of free coinage; What
causes scarce money, insufficient coinage or lack of
business confidence? Essentials of a sound money system?'
The two Banks of the United States; Evils of the sub-
treasury system; Defects of our national banking sys-
tem; The Canadian banking system; How should our
banking and currency system be reformed?

Debates on: Resolved, That a scientific banking and
currency system rather than free silver is the real rem-
edy for western and southern money hardships ; Resolved,
That the government should restore free coinage of
silver at 1 6 to i ; Resolved, That this country needs a.
reformed banking system similar in general to the
Canadian; Resolved, That the greenbacks should be re-
tired by the banks, and bank notes substituted.

It would be well to have the class lecture read and
discussed in the meetings; also selections from the:

24o GUNTON'S MAGAZINE

suggested readings; and certain members might con-
duct question tests on the lesson for the month.

QUESTION Box

The questions intended for this department must be accompanied by
the full name and address of the writer. This is not required for publica-
tion, but as an evidence of good faith. Anonymous correspondents will
be ignored.

Editor GUNTON'S MAGAZINE : Dear Sir : — I do not
understand your position that practically no civilization
or freedom is ever developed in agricultural countries.
How about our own country before the revolution of
1 776 ? Must there not have been great development to
have led up to an uprising out of which was established
the only permanently successful republic the world has
ever seen ?

S. R. H., Holyoke, Mass.

Our own country before the Revolution was stocked
with the products of centuries of town life in England.
New England has a background of manufacturing and
town life of several centuries, dating back at least to
Edward III. If you want a real specimen of agricultu-
ral influence with a traditional rural background take
the Russian peasantry, the English peasantry, the
French peasantry, or the peasantry, in short, of any
European country ; then you will have populations
whose whole life, practically, is drawn from agricul-
tural environments. But neither our western farmers
to-day nor the New England farmers of 1776 represent
a product of purely agricultural conditions. They are,
and were, a transplant from the best that four centuries
of town life and diversified industries could produce.

GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

TRADE UNION LEADERSHIP

During the last twenty years there has been an in-
creasing tendency to divide the labor movement into
revolutionary and evolutionary camps, represented re-
spectively by socialism and trade unionism. In Eng-
land, since the London dock laborers' strike in 1889,
under the leadership of the London Fabians socialism
has largely taken control of the trade union movement.
Nearly all the trade union leaders of distinction in Eng-
land are dominated with socialist doctrine, and under
the name of "The New Trade Unionism" they are
directing the trade union movement directly in the line
of socialist propaganda. The English socialists pride
themselves on being a little more practical than their
German brothers, in that they do not so openly advocate
socialism but rather advocate trade unionism and use
the unions for the purpose of socialism. In this country
the socialist movement has been chiefly under the lead-
ership of the Germans, of the Marxian School, who
have openly declared their principles, announcing as
their purpose the ultimate re-organization of society on
a socialistic basis.

The part of the labor movement which is historic
and evolutionary is represented by the trade unions.
In this country the trade union movement is repre-
sented by the Federation of Labor, which claims to
have a membership of three-quarters of a million. In
its annual convention the American Federation has pro-
claimed against socialism, and has thus far successfully
resisted the efforts of socialists to capture its organiza-

241

242 GUNTON'S MAGAZINE [April,

tion. Mr. Samuel Gompers has been elected president
more than once as the anti-socialist candidate. This
was conspicuously the issue upon which he was elected
at the last convention. Hitherto the trade union move-
ment has repudiated the doctrine that private property
is robbery and that all the tools and means of produc-
tion should pass to public ownership. On the contrary,
it has recognized the historic fact that trade unions are
the normal product "of industrial progress, and a natural
part of the modern organization of industrial society.
It recognizes the principle that the distribution of wealth
among the masses is through wages, and that the mater-
ial welfare, social elevation and political freedom of the
laboring classes is secured directly as wages rise, prices
of commodities fall, the working day becomes shorter,
and the social opportunities of the laborer widen and
multiply. The real function of the trade union, based
on this principle, is to devote itself to the accomplish-
ment of these specific results. It is contrary, therefore,
to the character, tradition and principle of trade unions to
become anti-capitalist organizations. Their function is
not to abolish or hamper capital, but constantly to secure
a greater and greater share of its products for labor.

In view of this principle and policy, it is not a little
surprising to find the president of the American Feder-
ation of Labor declaring editorially in its official organ,
the American Federationist, for an anti-capital platform
as "An American Internal Policy." In its March
issue Mr. Gompers gives his unqualified endorsement
to the following:

"Public ownership of public franchises.

"Destruction of criminal trusts.

"A graduated income tax.

"Election of [United States] senators by the people.

"National, state and municipal improvement of the
public school system."

I899-J TRADE UNION LEADERSHIP 243

.This platform appears to have been submitted by
the New York Journal. Regarding it Mr. Gompers
says: "In the five propositions submitted as an Amer-
ican internal policy, there is not a feature to which I do
not give my hearty and entire approval."

If the American Federation of Labor stands upon
this platform, it has ceased to be an economic organiza-
tion and has become the victim of socialism without
knowing it. This policy is neither good trade unionism
nor good labor movement; it is not even good social-
ism. It represents merely uneconomic nagging of cap-
ital. Socialism stands for a consistent policy, — the abo-
lition of private ownership of productive property. But
the platform here endorsed by the president of the
American Federation leads nowhere. Four of these
five propositions are based upon crude public prejudice
against successful business enterprise, mainly created
by sensational journalism and socialistic propaganda.
They rest on no sound principle of economics, sociol-
ogy or statesmanship, nor do they conform to any ra-
tional theory of public policy or social reform.

The first proposition, which declares for public
ownership of all railroads, telegraphs, telephones and
other enterprises which are operated through public
franchises, is out-and-out socialism. In advocating this
Mr. Gompers has gone over to the Sanial and De Leon
camp of Marxian socialists. It can be defended only
on the general doctrine that private ownership is rob-
bery, and that the public should own and control all
profit-making industries. Here is Mr. Gomper's de-
fense of this proposition :

" Certainly the lavish hand with which special privileges have been
granted to private corporations and the unscrupulous methods used in
obtaining and hedging about these privileges merit the contempt of
every American and should call forth such an indignant protest as to
compel the public ownership of such privileges and franchises."

Are the members of the federated trade and labor

244 GUNTON'S MAGAZINE [April,

unions expected to accept this sweeping, inexact and
unreasoned statement as sufficient cause for joining
populists, socialists, single taxers and political revolu-
tionists in voting for the public ownership of industry?
It is not to be denied that the applying of electricity to
local transit, gridironing the country with trolley lines
connecting cities, towns and hamlets with cheap and
rapid transit, has not been entirely free from questionable
methods. Improper influences may have been used to
secure franchises in some instances, but it is not pre-
tended that this is not exceptional, or that corruption
characterizes corporate existence in general.

On the other hand, the benefits of this movement
in improved and cheap service to the community are in-
calculable. But the astonishment is that Mr. Gornpers
should so far lose his balance as sweepingly to demand
the public ownership of these properties, to correct the
evils he speaks of. If the public officials throughout
this country are so corruptible that their conduct
" merits the contempt of every American," what might
we not expect if we put the entire conducting of in-
dustry in their hands? That would seem to be an ad-
ditional reason for entrusting them with as little power,
especially where business interests are concerned, as
possible. The community which cannot elect officials
with sufficient integrity honestly to award a contract or
grant a franchise falls a long way short of having in-
tegrity enough to own and conduct the entire property.

Such wholesale and indiscriminate condemnation
of corporate enterprise hardly comports with mature
conviction and thoughtful leadership.

The second proposition, " Destruction of criminal
trusts," savors of the nomenclature of yellow journalism.
It is practically stigmatizing all trust organizations as
criminal. This is not a little surprising, from the pres-
ident of the American Federation of Labor. No man

1899.] TRADE UNION LEADERSHIP 245

knows the importance of organization and integration
better than Mr. Gompers. The Federation of Labor is
a successful illustration of that principle. It is a com-
bination of the organized local trade unions through-
out the country, in all trades and industries, to increase
the economic and social effectiveness of every local or-
ganization. There are capitalists who are crude enough
and unintelligent enough to speak of this federation as a
criminal combination, but enlightened public opinion
ignores them as not a part of the competent consensus
on the subject. Mr. Gompers would be the first to say
that capitalists who talk in this way are either ignorant
or wantonly antagonistic to the natural tendency of
modern industrial conditions.

No, it is not true, — it is a bald, unwarranted assertion,
to say trusts are criminal, either legally, economically or
morally. There are fools among the organizers of capital,
and there are fools among the organizers of labor. Mr.
Gompers has many a time had to blush for the rash
ignorance of his comrades in times of excitement and
disturbance. Intelligent organizers of capital have to
blush — and suffer — for the economic idiocy of some who
become prominent in the management of trust organiza-
tions. There is a tendency in the community to estimate
the character of every group or class by the poorest
specimens, and thus the irrational, ill-informed capitalist
who arrays himself against trade unions and denies the
right of laborers to organize is too frequently taken by
laborers as the representative of the capitalist class,,
when he is nothing but a belated member.

On the other hand, employers and the public too
frequently insist upon judging all labor organizations
by the irrational conduct of a few hot-headed, impetuous
leaders who advocate all sorts of uneconomic folly. But
no man in America knows the injustice of this better
t an Mr. Gompers. He has suffered many a time*as

246 GUNTON'S MAGAZINE [April,

the atonement for this irresponsible and unrepresenta-
tive conduct. He, therefore, should be the last man
sweepingly to condemn as a criminal movement what
he knows to be a natural economic tendency. There
may be criminals in it, but the trust movement is a
natural economic movement towards more efficient
methods of production, the improving of the quality
and lowering of the price of all forms of consumable
commodities for the community. It is the movement
of applying the highest achievements of science and the
highest development of organizing skill to furnishing
the necessities, comforts and luxuries of life to the
public. On this subject he *ays:

" The measures intended for the regulation of the trusts have too
often been turned by a perversion of the law against the labor organi-
zations. One instance of this perversion of so-called anti-trust legisla-
tion has been manifest in the court-made law extending the power and
use of injunction."

This is indeed true, but, as has more than once
been pointed out in these pages, this extraordinary use
of the ' ' power of injunction " to prevent the right of
laborers to strike, by anticipating their action, is really
a boomerang from the anti-trust legislation. The
workingmen, the populists, the anti-capitalists gener-
ally, induced the politicians to pass a law against trusts,
granting the power of injunction. In this law the
laborers clamored to have manacles put on the limbs of
capital. Of course, it was not expected that the same
law would provide manacles for the limbs of labor, but
the capitalists were too alert not to see that there were
two edges to that sword, and they promptly used the
one against labor, which really threatened to jeopardize
the freedom of labor throughout the country. We are
by no means rid of the dangerous consequences to organ-
ized labor from this boomerang anti-trust legislation.
Of course, the workingmen did not know the gun was
loaded, but the capitalists soon discovered that it was.

1 899.] TRADE UNION LEADERSHIP 247

If laborers think they can make laws to restrict organi-
zation of capital that will not re-act upon themselves,
they have a great deal to learn in the line of social econ-
omy and human nature.

In support of the third proposition, "A graduated
income tax," Mr. Gompers says: "That a graduated
income tax is justified is attested by the increased val-
ues created by the community — the unearned incre-
ment." This is surprising in more ways than one.
First, because the income tax is itself a most uneconom-
ic and immoral method of levying revenues. Uneco-
nomic, because it has the greatest amount of waste and
expense for collecting the smallest amount of revenue.
Immoral, because it is inquisitorial, annoying, and
leads directly to all forms of lying and fraud, for eva-
sion. But to advocate a graduated income tax commen-
surate with increased values, or the growth of so-called
"unearned increment," is to apply the single tax doc-
trine to all profits. To apply the tax to incomes, grad-
uated so as to increase proportionately as .the income or
profits of industry increase, is neither more nor less
than confiscation of profits through the pretence of a
tax. Economically this is not quite so respectable as
socialism.

In support of the fourth proposition, " Election of
senators by the people," Mr. Gompers says: " That sena-
tors should be elected by the people and not by the
legislatures the merest tyro in the politics of recent
times is aware." The "merest tyro in the politics of
recent times " may be aware of this, but thoughtful
students of political science and practical statesmanship
are not. If the people cannot elect town officers,
boards of aldermen, or state legislatures with integrity
enough honestly to grant franchises, how is it to be ex-
pected that they would become suddenly intelligent
and virtuous in the election of United States senators ?

248 GUNTON'S MAGAZ1NE [April,

If candidates for the United States senate can corrupt
legislatures, they could corrupt delegates to political
conventions even more easily. The fact is, this plan
of popular election of the United States senators on the
ground of dishonesty of legislatures would be, if there
is truth in that charge, merely transferring the selec-
tion from one corruptible body to another. It is not a
reform; it is an impeachment of the integrity or the
capacity of the people to elect honest representatives,
and hence an impeachment of popular government.

There is an important conservative political principle
involved in the election of United States senators by
the legislatures instead of by the popular vote. The
founders of this republic saw that democracy needed all
the safeguards that conservative and diverse represen-
tation could give. This clamor — for that is what it
really is — to have the president and the United States
senators all elected by the direct vote of the people
simply means reducing the selection of the United States
government to market-place or mob opinion, which
would be fatal to stable government. To submit the
executive and both branches of the legislative govern-
ment to popular vote at every election would probably
lead to such unstable action as to jeopardize the vital
interests of the nation and destroy confidence in popu-
lar government.

Nobody knows better than Mr. Gompers the un-
certainty of a popular impulse among the working
people. He knows how difficult it is to get rational
conduct from the mass of the organization on the verge
of a strike. Passion overrules reason, and sentiment
sweeps the leaders off their feet; and he knows too that
when the rash act has been committed and the strike
has been inaugurated, against the judgment of the
leaders, it is just about as difficult to keep the same
men from indiscriminately rushing back and making

1 899.] TRADE UNION LEADERSHIP 249

the strike a failure. He knows how important it is that
executive officers should have authority to overrule
unpremeditated decisions, and hence it is one of the
rules of the organization that a strike inaugurated
without the consent of the central body shall not be
recognized. This has become necessary, in order to
invest a veto or conservative power in some part of the
movement, and thus not permit the first impulse of the
mass, which is seldom intelligent, to be final and
effective.

This is true, only in a far more important sense, of
our political institutions. The theory of our govern-
ment is that the popular will shall be represented in the
federal authority in three different forms. One is the
house of representatives, the members of which are
elected by the direct vote of the entire nation, through
districts determined by population. The term of these
is two years. The president is elected by popular vote
in a different form; that is, by states through represen-
tatives in the electoral college. His term is four in-
stead of two years. The United States senate was de-
signed to represent public opinion expressed in another
form, — by states, through their legislatures, which are
composed of the directly elected members of the assem-
blies and senates of the different states, making the
popular vote somewhat indirect. The term of senators
is six years.

Thus we have a system of government which
affords three different forms of expressing the public
will. This is the work of profound statesmanship.
To wipe it out and subject the whole government
at once to direct popular vote is a most serious
proposal. A change in this direction should not be
flippantly advocated, but should be a matter of the pro-
foundest consideration. There is doubtless room for
reform in the senate, but it is in the direction of a more

^50 GUNTON'S MAGAZINE

-conservative policy of admission of new states, not in a
change in the organic relation of the United States
.senate to the political constitution of the republic.

The fifth proposition, national, state and municipal
improvement of the public school system, calls for no
consideration, as it is a proposition that everybody
with any public spirit will approve.

Wage workers, and especially trade unions, whose
object of existence is to care for and promote the eco-
nomic interests of the wage classes, are not interested
in and cannot without great danger to their cause
.switch off into the advocacy of this class of propositions
^as an internal policy for this country. There is nothing
in them that is really important to the wage class. To
follow the advocacy of this platform is to chase a -will-o'-
the-wisp, pursue an economic mirage. It simply serves
to lead away from public consideration of the really vi-
tal questions in which the wage class is concerned, like
higher wages and shorter hours, and intelligent recog-
nition of the status of organized labor as a legitimate
factor in economic discussion and industrial policy. If
the trade union movement is going to be led by yellow
journalism into this kind of quasi-political and socialis-
tic quagmire, its usefulness as an economic organization,
and leader and defender of the interests and rights of
the wage class, will soon be ended. Semi-socialism,
impregnated with yellow journal antagonism to capital,
is the most disintegrating virus that could possibly be
injected into the labor movement. It possesses neither
the consistency of socialism, the intelligent cohesive-'
ness of trade unionism, nor the horse sense of ordinary
politics.

THE FUNCTION OF ART IN ECONOMIC
EVOLUTION

E. E. SPENCER, M. D.

Economic evolution is the progress of society from
poverty to wealth, from ignorant crudeness to social re-
finement, from barbarism to civilization. All that we
know of personal, social and political freedom, of the
growth of individual capacity, intelligence and integrity,
is dependent upon and included in economic progress.
Poverty is the source of weakness and the mainspring
of despotism. Poverty stultifies ambition, paralyzes
effort, and makes servile submission habitual and
characteristic. On the other hand, wealth strengthens,
broadens and vitalizes human life. It encourages
ambition, maintains effort, broadens the social horizon,
and inspires the hope of freedom. Nothing can give
freedom to a very poor people, nor can anything en-
slave a rich people. The . progress of any nation or
community, therefore, from poverty to wealth, is the
progress from slavery to freedom, from barbarism to
civilization.

What, then, is the function of art in this all-embrac-
ing and ever- widening evolution ? If we seek the
initiatory power that impels individual action and social
movement, the seed of new activity in any direction,
we shall find it in desire. Give a people new and diver-
sified desires, and nothing can suppress their activity or
prevent their progress. No sacerdotal authority or
political power can suppress the progressive impulse of
a people whose habitual desires are being diversified
and multiplied. And, conversely, no power can stimu-
late a people to activity and progress who have no new
desires. Take away the desire for any institution, prod-
uct, or association, and it will cease to exist. Con-

251

252 GUNTON'S MAGAZINE [Aprilr

scious action must have a motive. Doing is a means to
an end. We do things because we desire the result to-
be accomplished.

The function of art in economic evolution is to
supply a motive for doing. It is the social yeast. It is
the diversifier of taste and the creator of new wants.
Human wants may be classified as physical and social.
Purely physical wants, demanding sufficient food and
shelter to sustain life, can be satisfied on a plane not
much above the brute creation. All human wants above
those of the nomad, including intellectual, moral and
spiritual desires, are social wants as acquired by and
developed through experience in human association.
It is from these socially acquired wants and desires that
all the efforts and accomplishments of civilization have
come. The difference in the number, variety and qual-
ity of these social wants makes the difference between
the lowest savage and the highest civilizee.

The great propelling force in human progress, then,
is that which initiates and stimulates an ever-increas-
ing diversification of social tastes, and this is the func-
tion of art. It refines and expands the old and
introduces the new. The taste stimulated by the intro-
duction of the new and more beautiful is the germ of
a social force which is destined to develop an economic
interest which sets the world in action. The desire for
a more attractive form of anything habitually entering
into the social life of a people creates a demand for its
production, which sets the economic machinery in mo-
tion to supply it. At first it is produced at an enormous
cost, only for the very rich, but, by the force of imita-
tion and contact, what the rich have the less rich desire,
and its domain widens from the monarch or aristocracy
to larger social groups, until it reaches the masses and
becomes the market basis for profitable capitalistic pro-
duction.

-1899. ] ART IN ECONOMIC EVOLUTION 253

It is in this way that the multitude of things which
once were the exclusive enjoyment of the favored few
now contribute to the comfort and refinement of the
millions. Every step in the improvement of home
decorations from the mediaeval hovel without windows,
chimneys, or hinged doors, to the best appointed mod-
ern home, is the economic outcome of art and innova-
tion. This introduction of art into the social life of the
people has been the yeast of modern progress. Not
that all who use artistic products have artistic tastes.
The human race does things and learns about them
.afterwards. The great mass of mankind follows the
lead of a few. It is in this way that art has been the
great revolutionizer. In dress, manners, language,
personal bearing, morality, and even in sheer decency
of conduct, we do what custom demands.

The great cultivating force in society is not the
conscious teaching of lessons but the unconscious
habit of doing as others do. We learn by imitation and
refine by habitual repetition. Habit is the strongest
force in human society. It is stronger than religion or
governments. When a new desire created by artistic
invention becomes sufficiently general to be a social
want of a considerable class, it becomes an irresistible
•economic demand. It becomes a market force to which
capitalists, inventors, statesmen and merchants all re-
spond.

This social standard, thus established, has ever been
the great power through which social institutions are
sustained, modified or revolutionized. Art is the crea-
tor of discontent. Demand for new things, or better
things, or more things, or a greater variety of things, is
due to the force of social discontent. The evolution of
architecture from the simplest hut to the artistic modern
structure, which is now such a great force in social cul-
tivation and in economic development, has come in this

254 GUNTON'S MAGAZINE [April.

way. Modern sanitary appointments could never have
been developed from the deadening influence of huts with-
out windows or chimneys, and hewn blocks for furniture.

Thus it is that the great contribution, or function,
of art in economic evolution is to create the motives
for economic action, through the diversification and
refinement of taste for new and constantly increasing
variety of things and experiences.

The social and economic activity thus created con-
stantly tends, through the diversification of ideas and
experiences, to develop the intellectual and moral facul-
ties and broaden the view of social duties and human
rights. The greater the variety of experiences, the more
refined the judgment and acute the intellect, because,
like every other faculty, these grow with use. In the
multitude of experiences we evolve complex social
life, and the opportunities for frequent comparison be-
tween the better and worse results of experiments are
greatly increased thereby. Comparisons are made
with a constantly rising standard of social ideal. In
this way social problems are created and become mat-
ters of intense public concern, which in a simple state
of society would fail to create a ripple of attention.
Indeed, when houses had no chimneys, pestilence
could wipe out the population with no more resulting
public concern than attributing the calamity to an out-
raged providence. Sanitation and science have come
along with improved architecture, upholstered furniture,
carpeted floors and higher wages. Wherever art has
failed to introduce the discontent-producing forces
which lead to this diversification, poverty, pestilence,
superstition and despotism still prevail.

It is probably true in every domain of human activ-
ity that, if we build at all well, we build better than we
know. This seems to be especially true of artists. Of
course, artists love their art, but they seldom recognize its

1899- ] ART IN ECONOMIC EVOL UTION 255.

full social, much less its economic and political, signi-
ficance. Art gives smoothness, grace, poetry and culture
to human character. It softens, mellows and humanizes,
life; but it contributes its best to civilization only as.
these refining and elevating influences enter the daily
life of the social masses. Nothing, not even culture, is.
broad and liberal when it is limited to a small circle or a
narrow class. It becomes really altruistic and socializ-
ing only when it takes on the spirit of democracy and
touches the millions.

In reality, then, art serves its best purpose and
makes its best contributions when it is transferred from
the sphere of individual hand-labor effort to the world
of machinery and markets. It is then that it harnesses-
science and capital to its chariot, diversifies employ-
ment, increases and cheapens wealth for everybody,,
broadens social life, raises the price of human labor ,
and elevates the plane of civilization. In short, it is-
then that it makes wealth cheaper, man dearer, and
human life more worth living.

But it is this very tendency to extend the produc-
tion of art goods to the factory, and subject it to the
profit-yielding influence of the market, that artists com-
plain of. In his work "Culture and Anarchy," the
great apostle of culture, Matthew Arnold, declared that
machinery and wealth "have materialized the upper
classes, vulgarized the middle classes and brutalized the
lower classes," and all because it has made the wealth
that the art taste has brought into existence cheap and
abundant, and commercialized its production and dis-
tribution. Ruskin/in a similar strain, laments the sub-
stitution of machinery for hand work, because it com-
mercializes the product. He thinks that the great func-
tion of art is to cultivate an artistic sense in the doing,,
and, when the producer is not an artist but a mechanic,,
art is really dethroned and debased.

t256 GUNTON'S MAGAZINE [April

This is all a mistake. The idea that culture must
come through the process of doing, and doing in the
slowest and least productive way, is a radical error. It
is not so much by the act of making, but by the com-
fort and pleasure of having and being, that mankind is
improved. It is not in the process of producing art
products that society is improved; on the contrary, that
process may narrow and dwarf the individual. It is
the consumption of these products that broadens and
socializes. It is in the process of consumption that social
intercourse takes place, that the action and re-action of
mental and moral criticism results, and that the imita-
tion of the better and the elimination of the poorer is
constantly going on. It is mainly the experiences on
the consumption side rather than the productive that
broaden, mellow, elevate and refine human character.

The other view fails to recognize the dominant
principle in human progress, viz: that people learn by
-contact and imitation, and retain by habit. For this
reason, all progress towards art and refinement begins on
the outside and penetrates inward with repetition and
criticism. That is why, in the evolution of art, whether
in architecture, home decoration, clothes, personal
adornment, or manners, the crude and superficial always
precede the refined and thorough. So, when the use of
-art products is extended to a new social class, it is always
by the use of the loud, cheap and inferior forms. This
is not to be condemned as degradation of art, but rather
-as the beginning of art culture. It is through the in-
troduction of these crude, and, to the refined, repulsive,
forms of art product that the ultimate evolution of re-
fined taste, good manners, and social cultivation is made
possible. It is only in proportion to the frequency with
which these experiences are repeated that taste is im-
proved and real culture is widened. This influence
gradually shows itself in improved taste in domestic

I399-]

ART IN ECONOMIC E VOL UTION

257

-art. Every addition to the home improvement is a
tendency to substitute the more refined and genuine
for the crude and superficial, and with this the personal
bearing, manners, and general culture of the family is
improved. Every such step raises the standard of liv-
ing and constitutes an economic force that ultimates in
higher wages and the possibility of more wealth and
social well-being.

To say that because wealth is cheapened and intro-
duced to the poor in crude form, and furnished by fac-
tory methods, it materializes the upper classes, vulgar-
izes the middle classes, and brutalizes the lower classes,
is to misapprehend the whole trend of societary ad-
vancement. In truth, civilization did not really begin
to make any marked progress until art entered the
commercial sphere and touched a widening social class.
During the Middle Ages, when culture was confined to
the few, it made no impression upon mankind. The
range of its light for ages was only the range of star-
light in the night, and it produced no serious effect up-
on the wide darkness of the times.

The greatest benefit mankind has ever received
from the cultured classes has been, not as they in their
-self -satisfaction so confidently think, directly from their
ideas and fine sentiments, nor from their ability to crit-
icise Homer, or to appreciate beauty, or to moralize
deeply; but from quite another direction. It has been
their large consumption of the finest and most expen-
sive goods of their day, the best stuffs and foods,
houses, ships, tools, horses and cattle, and carriages, by
which they have profited mankind. Their large con-
sumption has led to increased and more diversified pro-
duction by workmen, and to the invention of new
kinds of industries whose pursuit was a living and
training to the masses. Where the cultured classes
were poor, as were the scholars of the monasteries in

258 GUNTOWS MAGAZINE [April,

the Dark Ages, they proved to have no effect whatever
upon the social movements of their time. The rich
rioted in sensuality and brutality, and the poor starved
in squalor and misery, both unhelped by culture and
untouched by it. The truth is, that even culture, when
poor, is nearly impotent in its effect upon the progress
of society. It is only rich culture that produces an ef-
fect worth considering, which effect is quite as much
the result of its wealth as of its culture. No rich com-
munity can stagnate altogether, and no poor one ad-
vance very much, and the reason for this is that when
culture is poor, art is produced for a small number; it
is produced exclusively by hand labor, and is limited to
a small circle. The smallness of its circle not only lim-
its the area of its influence but it begets a social conceit
and class exclusiveness which is itself inimical to broad
culture, social advance, and increasing human welfare.
Machinery further contributes to general progress
by giving to men increasing leisure and opportunities.
Hours of labor are shortened in machine-using countries
and multifarious interests created by new diversification
of industry, and, through these greater opportunities
and accompanying increased wealth, the laborers be-
come consumers not merely of the physical necessities
but of the comforts and art luxuries of civilization.
This increase of comfortable leisure is something that
no " sweetness and light," communing with itself in
solitude, ever chanced to think about and could not
promote if it did. To give the masses the resources of
leisure is beyond the reach of everything and every-
body, however well intentioned, except capitalistic
methods of furnishing aft products to the world. Noth-
ng else than the swift and inflexible fingers, tireless as
steel, multiplying production as the apple tree its blos-
soms, is able to cultivate square miles of corn and wheat
where formerly only acres were tilled, and to create

ISQ9.J AR'I IN ECONOMIC EVOLUTION 259

train-loads of goods where before only wagon loads
were possible, and to spread them over continents where
before they could scarcely crawl through the country.
Nothing less powerful than this materialized machinery,
this commercializing of art creations, could ever give
more than a few lonely scholars the time to cultivate
the " sweetness and light " that the Arnolds and Rusk-
ins represent. How, without this machinery, born of
the commercial spirit if you will, was the opportunity
ever to befall the masses to look for anything beyond
the daily grind for daily bread, lasting as it used to
fourteen and sixteen hours of the twenty-four every day ?
In slandering machinery and scorning the commer-
cial spirit, the Arnolds and Ruskins berate the best
agent for effecting their own purpose. They know not
what they do. They find fault with the very bridge
which is carrying humanity across the stream of
poverty, ignorance and vulgarity to the realm of
wealth, culture and freedom. Machinery and commer-
cialism, in countries where they prevail, have started
the whole body of people on the road to a higher state
of existence. Nothing of the sort has happened in non-
machine-using countries. The masses of China, for
instance, are still asleep. The Arab and Tartar are as
they were in the days of Solomon. The Russian is
drowsy in his ancient slumber, and the Moslem in his
poverty is still content in crying ' ' There is no God but
Allah and Mohammed is His Prophet." Through social
stupor and industrial neglect, Spain has fallen from her
seat. Italy is but just beginning to rouse. But Germany,
France, England and America are plunging deeper and
deeper into questions of how the poor shall be made
rich, the ignorant learned, the dull quick, the workman
prosperous, and the whole community happy. While
Mr. Arnold warbled like a lark in the heavens of his
culture, the click of the machinery which he abhorred

260 GUNTON'S MAGAZINE [April,

was working out a greater benefit to mankind than was
ever dreamed of in his philosophy.

JH^ It is only as wealth is cheapened and art can flow
freely into the homes of the millions that any real
progress in the nation and for the race is possible. It
is this fact and this fact only that has put the United
States at the head of the human race. It is this which
represents the difference between the United States and
Asia or Russia. It is because the creations of genius
have been commercialized for the masses that the
impulse of the whole nation is moved toward progress.

It is true that from the point of view of our Arnolds
and Ruskins the masses are crude and vulgar; but they
are virile, and in proportion as their social wants in-
crease and their consumption of wealth expands they
impart that virility to the life of the nation. They
are making the politics, the laws, wealth and liberty of to-
day. They are making human progress to hum on the
smoking axles of the times, where the university and
culture would let it drone helplessly on as it did before
machinery and commercialism took the human problem
in hand.

Exclusive culture may be beautiful to see — a rose of
civilization — but the savior of the people is the machin-
ery that makes wealth cheap and man dear. This is
not a criticism on culture or art, but only a criticism on
the contracted, non-social and un- democratic point of
view that artists sometimes take of the social aspect of
their function.

If culture were once to connect itself with the main
interests and greater questions of humanity it would
gain so much in solidity and power that it would be
able to be of far greater benefit. Were it once to mas-
ter the great machineries — the political, the economic,
the scientific, the social, — it would add to its own present
resources of grace and good breeding the qualities of

T899- J ART IN ECONOMIC E VOL UTION 261

fitness for life and its duties, fitness for leading and ad-
vancing" men. Then the people would have for their
leaders not the rude and one-sided mechanics who now,
by virtue of having the root of the matter in them and
being engaged in active deeds, are shaping the future,
but men of trained and comprehensive powers who
would be able to conduct the world forward without
the waste of blundering, the discord and rage, that now
attend the methods of progress.

The bitter contention which deforms and distresses
the course of affairs would give way to an orderly move-
ment of well-planned and resolved measures. Instead
of a progress slow, jolting and devious, like that of a
farmer's ox-cart over a stony field, we might have one
swift, smooth and direct like that of a flying express
over the ordered rails of scientific foresight and de-
termination. The routine cleverness and verbal facility
of our educated classes might then be joined to a stren-
uous and virile potency which would at once forward,
elevate and fraternize the whole social procedure, and
culture instead of crudeness become the leader of hu-
man progress.

DISTINGUISHED ECONOMISTS
X — FREDERIC BASTIAT

Frederic Bastiat, whose picture is presented as a
frontispiece in this issue, was one of the most brilliant
of French economic writers. Bastiat was born in 1801
and died in 1850. His career as a contributor to eco-
nomic literature was brief, beginning only about 1 844.
He was actively on the scene of the Revolution in 1 848-
49, and showed his greatest wit and brilliancy in com-
bating the socialism of his time.

As an economist he was a follower of Adam Smith
and Say, and an idolizer of Bright and Cobden. Bastiat
can hardly be called a scientific economist, though he
exercised a remarkable influence on economic opinion
in France. His views on value were largely taken from
Henry C. Carey, who also charged him with purloining
his argument on rent. He translated the leading
speeches of Cobden, Bright, Fox and other anti-corn
law leaders, into French, which gave the doctrines of
the Manchester School great popularity in France. His
"Sophisms of Protection" is regarded by many as the
most brilliant exposure of protective postulates ever
published. As a matter of fact, however, his brilliancy
was all on the surface. His treatment of the subject
was in a narrow groove, never broad enough to include
the social forces underlying productive expansion. He
was a lover of cheapness, but never understood how
economic cheapness was really developed. Bastiat
never saw the economic and social difference between
low prices caused by cheap labor and low prices caused
by improved machinery.

He was dominated by the idea that all interests in
the community were in entire harmony, and that they
centered upon the point of low prices — in short, that

262

DISTINGUISHED ECONOMISTS:— BASTIAT 263

the consumer's interest was the interest of the human
race. It made no difference from this view whether
the low price was due to slave labor or to improved
machinery, and this was the radical and fatal error in
his whole economic reasoning, — philosophy he could
hardly be said to have had. He insisted that all that was
necessary in order to get complete economic harmony
and low prices was absolutely free competition. What-
ever it was for any individual's interest to do was for
the interest of the community. From this view, if the
capitalists wanted to work laborers, as they did, an in-
definite number of hours, for unendurably small wages,
it was all in harmony with the interests of the com-
munity, because in making the laborers work long
hours for low pay they were able to give the public the
products at a lower price, and thus, according to
Bastiat and according to the whole school of laissez faire
economists, the laborers received, in cheap commodi-
ties, what they lost by low wages. Anything more
short-sighted and fundamentally fallacious it would be
difficult to conceive. This doctrine ignored entirely
the broad fundamental fact of all economic development
and social progress, that the very basis of cheap pro-
duction is not cheap labor but highly developed ma-
chinery, and that highly developed machinery can
never exist for supplying the wants of a community in
which exhausting labor at low wages, and consequent
simple life and small consumption, exist.

Bastiat came upon the scene of action when the
anti-corn law agitation of England was at its height.
He drank in a few narrow postulates of the Manchester
advocates, and mistook them for comprehensive eco-
nomic principles. Consequently, it may be said that
he was a brilliant dispenser of economic sophistry, but
added little or nothing to the solid science of economics.

EDITORIAL CRUCIBLE

THIS MAGAZINE has always advocated, and for
many years single-handed and alone, the economic
principle involved in trusts as a part of the natural
tendency of economic society, but from the first we
have insisted that the use of the trust power to put up
prices is uneconomic and contrary to public policy, and
should not be tolerated. In discussing ' ' The Era of
Trusts " in our last issue, we referred to the tin plate
trust as open to this criticism, and suggested that if the
trust continued this policy Congress would be justified
in putting tin plate on the free list. Our attention has
since been called to the fact that the rise in the price of
pig tin and steel plate, neither of which the trust pro-
duces, and an increase of wages, are the causes which
made the increase in the price of tin plate necessary.
Of course, if this is true it removes the ground of our
criticism. The trust cannot be held responsible for the
rise in the price of raw material which it is compelled
to buy, nor censured for the rise of price of its own
product which this makes inevitable, especially to the
extent that a rise of wages is the cause. While we are
unqualifiedly opposed to any monopolistic price-raising
action of trusts, we are equally desirous of doing no in-
justice. In the interest of fairness, therefore, which is
not too prevalent in discussing these subjects, we pro-
pose to make a thorough investigation of the tin plate
trust case and give our readers the result in the next
issue of this magazine.

IT is ENCOURAGING to note the fact that with the
returning prosperity in business is coming the news
from all parts of the country of increasing wages. The
cotton operatives of Fall River, Massachusetts, have
received an increase of twelve and one-half per cent. ,.

264

EDITORIAL CRUCIBLE 265.

which is a restoration of the reduction that took place a
little over a year ago. This is the more significant
because in the cotton industry Fall River leads New
England, and, after the rise of wages in Fall River was-
announced, a similar rise took place throughout practi-
cally the whole cotton industry of that section. Similar
news comes from the mining field. The united mine
workers of Pennsylvania, Ohio, Indiana and Illinois
have, since 1897, received an increase of thirty-three
per cent, in wages, and, what is even better, they have
obtained the eight hour work-day. The officers of the
union have just issued a buoyant proclamation asking
all the miners through that section to join in commemo-
rating the event as a conspicuous landmark in the
improvement of the miners' condition. It adds that the
eight hour day ' ' has not only proven a priceless boon
to our craft but is now also looked upon with favor by
our employers." This is real progress.

AMBASSADOR CHOATE'S remark in his first speech
in London, about our delight in " twisting the lion's
tail," and our disappointment that " he would not roar
at all " at the Venezuelan twist, seems to have disturbed
the sensitive nerves of the New York Times. In a very
serious editorial on the subject, with its full measure of
dignity, it asks: "Was the utterance of the Ambassa-
dor authorized? "

What matter whether it was or not? It was the
truth. There is not the least doubt that Mr. Choate's-
remark, indicating the mere political demagogy of Mr.
Cleveland's performance in the Venezuelan matter, ex-
pressed the good sense of serious-minded, patriotic
Americans, and certainly of the present administration.
A more blunderbuss, uncalled-for piece of public policy
was probably never indulged in by a responsible states-
man than that Venezuelan message. It was an appeal

266 GUNTON'S MAGAZINE [April,

to the lowest, jingoistic national prejudice, in the hope
of booming his chance for another term; but a more
brilliant performer in this line carried the Chicago Con-
vention. In this instance, at least, Mr. Choate was
clearly right, and if he was not authorized he certainly
will be endorsed.

As IF TO verify the adage that republics are un-
grateful, Mr. Samuel M. Jones, the socialistic mayor of
Toledo, Ohio, has been refused a renomination by the
Republican party; whereupon he has announced his in-
tention of running as an independent candidate. Mr.
Jones is an out-and-out socialist; he endorses the most
radical socialist doctrine. He has proclaimed, not only
in Toledo but in New York and other large cities, how
the people of his city are robbed by the private owners
of capital. The people of Toledo did not know how
badly off they were until Mr. Jones discovered their
condition while mayor of their city. They have had
Mr. Jones for one term, and it will be highly interesting,
therefore, to watch the outcome of the Toledo municipal
election. There is no ambiguity about his position. The
voters know him, and know his doctrines. If he is
elected it will be because the majority of the people of
Toledo are either believers in or very favorably im-
pressed by the principles of socialism, and are willing
to give him a trial. The votes Mr. Jones receives on
election day will indicate the state of the socialistic
mercury in Toledo, which it is fair to assume is not
radically unlike other American cities of 100,000 popula-
tion and upwards.

THERE ARE some public offices which may properly
"be filled for political reasons, provided the average
amount of ability is vouchsafed, but the superintendency
of the United States Census is a position that requires

T899-] EDITORIAL CRUCIBLE 267

•expert ability for that special kind of work. If there is
a man in the nation who has a known capacity in that
line, he ought to be appointed. Does ex-Governor
William R. Merriam, of Minnesota, possess any of the
known qualifications for that position ? If so, in what
position has he revealed these qualities ? The position
of Superintendent of the Census should not have been
given to any person who has not had previous ex-
perience and shown some talent in this direction. It
cannot be said that such persons were not available.
The bureaus of statistics in the different states furnish
material for this sort of work. Even S. N. D. North,
who was a candidate, has some known capacity for this
position, and the most experienced statistician in the
country, Hon. Carroll D. Wright, Commissioner of
Labor, was at the President's disposal. Therefore,
there was absolutely no need of giving the position to a
mere ex-governor, entirely without statistical or census-
taking experience. This was clearly a case where fit-
ness rather than politics should have determined the
selection.

THE SO-CALLED Cuban Assembly is apparently do-
ing its best to justify the conclusion that Cuba is not
capable of civilized self-government. The attitude of
this body toward General Gomez is worthy of the low-
est type of Spanish conclave under a Weyler dictator-
ship. In imprisoning General Toral and Admiral Cer-
vera, who are now awaiting a court martial which may
order them shot, the Spanish have at least the flimsy
excuse that these leaders were defeated in battle. But
the Cuban Assembly has not even this excuse for dis-
gracing General Gomez. Gomez was the Washington
of Cuba. Without him the revolution would have been
a farce, and Cuban freedom would have remained in
Spanish keeping. Whatever advantage Cuba has

268 GUNTON'S MAGAZINE

gained is primarily due to the patriotic sacrifice and
statesmanship of General Gomez. And yet, because he
was wise enough to accept the aid of the United States
in good faith, this firebrand assembly has voted him a
traitor, and some of its leaders demanded that he be
court-martialled and shot. Baser ingratitude was never
exhibited by untamed savages. The only encouraging
thought in connection with this disgraceful affair is that
this so-called assembly does not represent the character
and spirit of the Cuban people. If it did, they ought
to have been left under Spanish control. They would
be unworthy of deliverance. Short work should be
made of disbanding this self -constituted assembly, and
the administration of Cuban affairs should be trusted
entirely to American authority until, through the free-
ly expressed will of the Cuban people, a representative
government can be established.

Civics AND EDUCATION

GRAVE EVILS IN OUR PUBLIC SCHOOL
SYSTEM

W. F. EDWARDS

In the March, April, June and July (1896) numbers
of the A tlantic Monthly appeared four papers which are
based on answers to a list of questions sent out to teach-
ers by the editors. From these papers it appears that
partisan politics, church interference, personal friend-
ships and the influence of the agents of book com-
panies are the most potent factors working against the
best development of our schools. These conclusions
are drawn from a consideration of about twelve hun-
dred answers to the list of questions, which came from
all parts of the United States, and which show much
the same condition to obtain in nearly all of the states.
In the fourth of these papers entitled " Confessions of
Public School Teachers " are given the experiences of
six teachers who have occupied positions where they
were enabled to see the influences interfering with the
action of the governing boards of the schools in which
the}- were employed. Also, in the November (1898)
number of the same periodical, in a paper entitled
" Confessions of Three Superintendents" is given ad-
ditional evidence of these interfering elements.

These experiences, while quite commonly known
to and discussed by superintendents, principals and
teachers, are, I believe, not generally known to be
widespread and endangering our educational institu-
tions. There seems to be a general sentiment in places
where these. school boards are bad that " We have the
worst board anywhere to be found." If the citizens of
.any such place could take the time to look about they

269

27o GUNTON'S MAGAZINE [April,

would soon discover that there are other schools with
bad boards or boards doing badly because of outside in-
fluences of the kind referred to above. It is commonly
known that public office in general is subject to the de-
grading influences of " pulls" and the spoils system,
although it is not generally openly approved. Even
those who openly approve of the spoils system for other
public offices agree that it should not be applied in the
case of our schools; usually meaning thereby that no
political (partisan) qualification should be imposed on
our teachers.

These papers are based quite largely on data taken
from city school affairs and leave a sort of impression
that superintendents, principals and teachers are blame-
less and that the whole difficulty is largely due to the
governing boards. Much that has been charged to bad
boards has been due to bad presidents, superintendents
and principals. A bad board of education and a bad
president, superintendent or principal is a wretched
combination to have in charge of a school or college,
and is more common than one likes to admit. It is by
no means uncommon for school boards to excuse their
unseemly action by stating that they only followed the
recommendation of the superior officer of instruction.
The excuse is a good one, but when it has been given
repeatedly for the same superior officer of instruction it
becomes rather a confession than an excuse. Some of
the ways by which officers of instruction and members
of boards are "tied together" are illustrated by the
following examples which have come to the writer's
notice within a few months.

The board of regents of one of our state universities
chose for the president a man who had sent his appli-
cation to each member of the board and to other state
officials high in aiithority. The man was 'at the time
president of another state university, and writes Ph.

1899.] EVILS IN OUR PUBLIC SCHOOL SYSTEM 271

D., LL. D. after his name. Within two months after
his appointment several members of the board threaten-
ed to resign rather than to vote for the recommendations
of the newly chosen president. The " wires" to be
"pulled" had simply become crossed by outside in-
fluences to which both the board and president were
subject and amenable.

A member of the board of regents of one of our
state universities approached one of the instructors in
the university to persuade him to " pass " his son in a
certain course in which he had failed from neglect.
The instructor refused to do so, whereupon the regent
told him how much influence he had had in retaining
other instructors in the faculty and finally told the in-
structor that he had as much influence in his case. The
instructor resigned and went to another university. In-
fluential people resort to this method of forcing their
sons and daughters through school quite frequently.
Quite as frequently they are "passed" by the teacher
because the parents are known to be influential.

In one of our cities several teachers in good standing
with the principal of the high school were dismissed by
the board of education after the superintendent had ac-
cepted another position and resigned. The superin-
tendent denies having anything to do with it. Inquiry,
however, brought out that the election of members of
the board for several years had been a struggle to get
a board with sufficient interest in the schools to dis-
miss this superintendent; also that this superintendent
had obtained positions for near relatives in the schools,
and that he obtained a position for still another near
relative in the schools of which he had recently taken
charge.

In a recent investigation in another city it appeared
that several teachers contributed, through the superin-
tendent, to the campaign fund for electing members of

272 GUNTON'S MAGAZINE [April,

the school board. To the casual observer the election
appeared to be conducted largely on political party lines.
It also appeared as if the superintendent considered his
position secure in the hands of one political party only.
Perhaps the most significant thing about this investiga-
tion was the quite common remark: " Is that all there
is against the superintendent and teachers? "

In another school, when the principal was about to
retire to follow another profession, he was approached
by a prospective successor and offered a certain sum of
money if he would resign in favor of the would-be
principal. The principal was approached by letter,
which is very unusual. He took the letter to the chair-
man of the board of education. The board had agreed
on a successor but had not formally elected him. One
member of the board had informed the man that he
was chosen, it only remaining for the board formally to
elect him; but when the meeting was called he and one
other voted for the "boodler." It is unnecessary to
inquire into the circumstances leading these two men to
vote for this candidate.

In still another city, where the principal of the
high school had resigned, the board of education con-
cluded not to elect the teachers for the high school
until a principal was selected. Some of the best teachers
were not re-elected, because the new principal presented
the recommendations of the old principal but neglected
to state that he had changed several of the names in
order to secure places for his friends.

A few examples of abuse of power, taken from our
state institutions, will show that " higher education " is
subject to the same retarding and interfering influences
that obtain in city schools. These cases also show some
-of the dangers of the appointing power.

That it is easy for the appointing power to be
misled by outside influences is well illustrated in the

i8$9.] EVILS IN OUR PUBLIC SCHOOL SYSTEM 273

case of one of our agricultural colleges. There was a
vacancy in the board, to be filled by appointment by
the governor of the state, and the probability was
strong that a new president would be elected to take
charge of the educational affairs of the college soon after
the governor appointed a man to fill the vacancy in the
board. A politician who was a member of the state
legislature desired to have a certain friend of his become
president of the college, and knew that he could, in all
probability, manage the board if only he could secure
the appointment of the right man to this vacancy there-
in. He advised his political friends in the legislature,
who were of the same political faith as the governor, to
" wire " the governor to appoint his candidate. They
did so, and a few days later the governor received
letters from these and other politicians throughout the
state urging the appointment of this man. The man
was appointed and the governor afterwards stated that
he was not aware before that the man appointed was so
popular. In another case, when a governor was asked
why he appointed a certain man regent of the state
university, he admitted that he had never seen the man
and had only heard of him as belonging to "our party,"
until a few days before the appointment was made, at
which time he had received a communication from the

county people stating that they had not been

remembered in the distribution of offices and asking

him to appoint Mr. regent of the state university,

vouching for his fitness. In large cities the mayors
could be misled in much the same way, but in the
smaller cities where every one is more or less known to
every one else this could not so easily happen.

The extreme of bad effects that may follow from the
abuse of the appointing power is well illustrated in the
case of one of our state universities. A combination of
circumstances had made it possible for the recently elect-

274 GUNTON'S MAGAZINE [April,

ed governor, whose political faith was opposed to that
of his predecessor, to appoint four regents of the state
university from the ranks of his own party (full
board of regents was a board of seven members). These
four regents began to caucus in order that they might
control the vote of the board. Within a sixteen-month
period after their appointment the university had three
different presidents on its pay roll, besides an acting
president; twelve new members in a faculty of twenty-
two members, at the same time reducing the number
to twenty; the sister-in-law of one of these new regents,
and the governor's son, appointed to professorships in
the faculty (the latter not accepting); a professor, who
was retained in the faculty after the casting of seven-
teen ballots to determine whether he or another man
should have the position, dismissed in May and rein-
stated in the following July; two members of the faculty
removed to make a combination position for a member
of the state board of education, who confessed to mem-
bers of the board that he had made no special study of the
subjects he was to teach; a deal in the board whereby
the secretary of the preceding board of regents, who
was also registrar of the faculty, lecturer on forestry,
and instructor in local history, became professor of
American history and lecturer on forestry. One of
the new regents became secretary of the board of re-
gents, registrar of the faculty, and librarian of the uni-
versity, and the above mentioned sister-in-law became
a professor in the faculty. A year later the pro-
fessor of American history was dismissed, and a few
months still later was appointed professor of history,
it having been given out at the time that he was the
most desirable of seventy-seven candidates, although
several of the candidates had received instruction un-
der some of the ablest teachers in some of our best uni-
versities, while the professor of history was known to

i899-] EVILS IN OUR PUBLIC SCHOOL SYSTEM 275

have had no such training in any way whatever, but
was also known to be very familiar with the history of
political intrigue in that state. Every workman on the
campus was dismissed at the same time, and with, only
a week's notice, to be replaced by the political friends
and relatives of these four new regents. A ' 'normal
diploma" was established, to obtain which the students
were required to take two kinds of psychology and two
kinds of moral science, the one kind being represented
in the courses of one professor and the other kind in
the courses of another professor. The conditions for
graduation were changed four times, the students being
asked to change their work in the middle of a term so
as to conform to the new regulations concerning gradu-
ation. A religious row developed among the regents,
which became so intense that the use of fists was threat-
ened in one of the altogether too frequent meetings of
this board. Seven other regents were appointed, mak-
ing eleven that the governor appointed in a period of
less than thirteen months; and there were various other
absurdities too numerous to mention.

There was a wholesome feeling throughout the state
against the actions of this board, and two petitions
were sent to the governor requesting him to interfere,
which he did by removing three regents. This, how-
ever, was of little use, for there were deals and compli-
cations after this interference that indicated that the
governor was powerless, apparently, in the hands of
the politicians, and could not appoint the right kind of
men for educational affairs. Much of this arose from
having a multi-functioned political officer in the insti-
tution. A politician of the state, who was a member of
the state legislature, succeeded in getting a bill passed
which gave the university its first liberal appropriation.
As a result he was elected secretary of the board of re-
gents and of the faculty and also a member of the faculty.

276 GUNTON'S MAGAZINE [April,

Notwithstanding this, he ran on his party ticket for the
legislature and acted in the capacity of lobbyist for the
university appropriations every term after his first elec-
tion, thus putting himself in the position of lobbying
for an appropriation from which he drew a good salary.

Another illustration is that of one of our industrial
schools. A majority of the board of trustees of this
school were of one political faith, and were inclined to
use extreme measures to maintain this faith. They
dismissed several members of the faculty, apparently
because they were not of this same faith and were not
altogether in sympathy with their ideas on the money
question. The president was among the number dis-
missed. His successor was, as a matter of course, a
pronounced advocate of the political notions and preju-
dices of the majority of the board.

Another danger to be feared from the appointing
power is that which grows out of a misunderstanding
of or a wilful misuse of departments of political and so-
cial science in our institutions for higher education, and
the commercial courses including instruction on finance
in our commercial and other high schools. Everyone
is familiar with the case of Brown University and the
Chicago schools. In a conservative college of the
"middle west" a professor of political and social science
was ' 'dropped" from .the facility, nominally because the
"'hard times" had decreased the available funds of the
institution to such an extent that it was necessary to
curtail expenses in this way. Inquiry was made con-
cerning it, and it was found that the real reason was
that his courses did not meet the approval of the re-
gents. In the case of one of our state universities about
to employ a professor of political and social science,
members of the board of regents said to the president
of the university: "We will not try to interfere with
any other department, but it will be wise for you to

1899.] EVILS IN OUR PUBLIC SCHOOL SYSTEM 277

choose a man for this department whose political faith
and views on the money question accord with those of
the majority of the board." The board was appointed
by and were nearly all of the political faith of the gov-
ernor of the state. In another case a member of the
board of trustees of normal schools, in commenting on
the privileges of the president of one of the schools,
said: "I believe the president should practically appoint
all the members of his faculty, but that the board should
approve of or reject his appointments as a safeguard to»
the institution. For example, I may state that if he
wished to appoint a professor of political science who
believed in the free silver fallacy I should vote against
him for I consider that idea a simple heresy." In an-
other case where the political faith of the majority of
the board had been changed by recent appointments to
the board, and a new president was elected soon there-
after, it was given out as a sort of political slogan that
there would not be a "gold-bug" in the faculty within a
year, and at the same time that the university could be ex-
pected to amount to something when this had taken place.

These examples show that school affairs are man-
aged very much like ordinary political affairs and that
they are subject like other things to the influence of the
"get there" spirit of the times. The spirit of right
and of reform is still with us, as evidenced by the way
the people come to the rescue at times when there is
anything very serious threatening our schools or other
public affairs. The unfortunate circumstance is that
the people so soon forget these abuses and go on in the
same old way until another shock is produced by some
unsuspected outrage.

There are many difficulties between the present
status of things and an even approximate freedom from
bad influences tending to retard the development of
and actually prevent the highest efficiency in our schools,

278 GUNTON'S MAGAZINE

and colleges. We cannot hope that members of boards
of education will always be chosen with a sincere regard
to fitness only so long as civil service reform in other
public affairs is scarcely more than a subject for cam-
paign speeches in which each political party abuses the
other and accuses it of almost criminal rascality in mak-
ing appointments. We cannot hope that boards of
education will not be influenced by ''boodle" when
supplying books and other equipment for our schools so
long as boards of public works, city councils, and state
legislatures can be bought in this way. We cannot
hope that boards of education will not be subject to the
importunities of their friends and relatives in making
appointments, so long as public sentiment favors the
home-industry idea of making teachers, and permits the
schools to be filled with young girls as teachers because
their parents are needy and find this an easy way of
keeping their daughter in school until she has graduated
from the high school. We cannot hope that these
boards will not be influenced to some extent by the po-
litical faith of teachers as long as ' ' party " is the para,
mount thing in our political affairs. We cannot hope
that presidents and members of the faculties of our col-
leges and universities, and superintendents, principals
and teachers in our schools, will one and all be above
using political and religious prejudices and * ' boodle "
to influence members of governing boards as long as
they feel that these pernicious tools can be used. We
cannot hope that any definition of eligibility of mem-
bers or method of electing them, or any system of
boards, will free our schools from all these bad influ-
ences; we can only hope to prevent the introduction of
new evils and increase of the bad influences of the old
ones. Drastic remedies must be applied to our educa-
tional affairs if we would have our schools stand as a
safeguard to our democratic institutions.

CIVIC AND EDUCATIONAL NOTES

It may be interesting to many people to know that
over nine per cent, of the area of the three most popu-
Parks l°us boroughs of Greater New York, —

in Greater Manhattan, Brooklyn and the Bronx, —
New York consists of park land; in other words, the
parks cover 7,564 acres. In Manhattan and the Bronx
there are 44 parks and 9 triangular spaces. In Brook-
lyn there are 25 parks and 6 parkways, the latter aggre-
gating 20 y± miles in length. The two largest parks
are in Bronx borough, — Pelham Bay Park of 1,756 acres,
and Van Cortlandt Park of 1,132^ acres. The famous
Central Park in Manhattan borough comes next, with
nearly 840 acres; then Bronx Park, in the Bronx
borough, with 66 1^ acres; Brooklyn Forest Park, in the
town of Jamaica, within the city limits, 535 acres; and
Prospect Park, in Brooklyn, 516^ acres. The rest are
considerably smaller.

In Bronx Park a botanical garden is now in process
of construction, which will be a credit to the higher
educational, artistic and scientific life of the city. It is
to cover 250 acres in the northern part of the park, and
the thirteen buildings devoted to plant culture and bo-
tanical exhibits will cover a space of 45,000 square feet.
Heat is to be supplied from a central power house, and
a complete system of drainage and water supply is be-
ing provided. A large museum building is well ad-
vanced toward completion, and will probably be occu-
pied by the middle of the coming summer. This gar-
den when completed will make Bronx Park one of the
most attractive and interesting of all the parks of the
city, as in many respects it is already by virtue of wood-
land and landscape scenery of exceptional beauty.

Miss Jane Addams, in the February Atlantic, writes

279

28o GUNTON'S MAGAZINE [April,

an article on " The Subtle Problems of Charity," with a
Common practical common-sense insight into the

Sense in matter quite above what is sometimes, —

Chanty we might almost say generally, — ex-

hibited in the attitude of people engaged in organized
charitable work. Miss Addams is the head of the Hull
House settlement in Chicago, and tears away with no
gentle hand a mass of uninformed sentiment that
prevails in regard to the customs of the poor, and the
need and effects of certain kinds of charity. The well-
known improvidence and apparently senseless extrava-
gance of the poor, which usually rouse the amazement
or indignation of nearly everybody on first becoming
interested in charitable work, is shown by Miss Addams
to grow out of a perfectly natural and inevitable trait of
human nature, not peculiar to the poor at all but ex-
hibited in other forms in all classes of society. ' ' The
poor family," she says, " which receives beans and coal
from the county and pays for a bicycle on the install-
ment plan, is not unknown to any of us. But as the
growth of juvenile crime becomes gradually understood,
and the danger of giving no legitimate and organized
pleasure to the children becomes clearer, we remember
that primitive man had games long before he cared for

a house or for regular meals The parent who

receives charitable aid, and yet provides pleasures for
his child, and is willing to indulge him in his play, is
blindly doing one of the wisest things possible."

In other words, Miss Addams recognizes the fact
that social instincts are in some respects even stronger
than the craving for mere physical necessities; to the
extent, at least, that great masses of men will forego
what we would regard as the common necessities of life
in order to satisfy the craving for diversion, recreation,
knowledge, variety of experience, and social com-
panionship. This tendency, so universally denounced>

I899-] CIVIC AND EDUCATIONAL NOTES 281

is in fact an indication of a most hopeful saving quality
in the race, and one which can be utilized in behalf of
social progress when an appeal on the lower physical
and material plane would utterly fail. In this same fact
is seen the root cause of the failure of movements
designed to transfer large groups of population from
cities to farm colonies remote from the centers of
civilization. A certain number can always be sifted
out who will take advantage of these offers, and for
such these colony plans are perhaps a useful outlet; but
it will never be possible to overcome the cityward
trend of population, any more than it will be to abolish
the law of gravitation or the attractive power of a
magnet upon iron filings. It is a primary human
instinct, — this desire for the human companionship,
opportunity, and later the broader development, that
come from the association and interdependence of urban
life.

The great problem is not to disperse population
and drive it back to the land (which is a reverse step,
away from civilization) but to take hold of the evils
associated with city life and, as far as possible, eliminate
them. Extension of centers of population throughout
the rural regions, and regeneration of these centers
within themselves, is the really effective program of
civilization. As Miss Addams implies in her excellent
article, any method of attempting to remedy the condi-
tions of the city poor which does not rest upon apprecia-
tion of the legitimate and necessary nature of the social
and higher instincts must be mistaken, ineffective, and
even positively harmful.

SCIENCE AND INDUSTRY

LABOR CONDITIONS ON EUROPEAN RAIL-
ROADS

No discussion or reasoning about modern industry
is adequate which omits recognition of the labor
interest involved in the matter. It is a narrow view
which calls an industry successful merely because it
continues to exist, regardless of the conditions under
which it exists, especially as affects the employees. The
sweatshops are successful in a purely mercantile sense,
but they are a colossal failure from the standpoint of
humanity and social welfare. The early factory system
in England was a success, looked at solely from the
point of view of the employer and profit-maker, but the
word was not justly applicable to that system until
more than half a century of continuous philanthropic
and legislative effort to raise the operatives to the plane
of decent working conditions and opportunity for rest
and social life.

It would seem clear enough that success is a mis-
applied word when the meaning given it is so partial
and one-sided as to include only the commercial or
employer's side of the industry in question. Never-
theless, this is a very frequent error, and, strange to
say, it is frequently made by people who are genuinely
interested in social reforms designed to benefit the
laboring class.

Thus, in the argument for public ownership of our
steam surface railroad and telegraph systems, based on
the experience of certain European countries, statistics
are adduced to show that the operation of the state rail-
roads in Germany, France, Austria, Belgium and other
countries is successful from the point of view of profits,
while the charges to the public are no higher. This

282

LABOR ON EUROPEAN RAILROADS 283

might be conceded, and yet it would remain true that
our system was better if, as happens to be the case, the
remuneration to labor was higher in the United States.
In other words, if with cheaper labor they give no better
service or lower rates, there is waste or less efficient
management somewhere in their system.

It seems to be practically conceded that rates on
European railroads are, on an average, at least no cheaper
than in this country. There may be exceptions in the
case of certain kinds of local traffic, but these are practi-
cally offset by extra fees for various baggage and porter
services that are performed free in the United States.
On long distance freight business, particularly for grains
and other crude material, the rates are very much lower
here. Exact comparisons are difficult because of the
differences in the character of service, distances covered,
and absence of a common unit of service by which
variations could easily be measured. In the March North
American Review ', Mr. H. T. Newcomb, writing on
" The Opposition to Railway Pooling," says that: " The
average charges for railway transportation are, per unit
of distance, lower in the United States, especially for
freight, than elsewhere in the world." At any rate, it
is entirely fair to say that the average on all kinds of
business is not higher in this country than abroad.

Now, as to the remuneration and conditions of the
employees on European railroads: information on this
point is given in considerable detail in a recent Bulletin
of the United States Department of Labor, and the re-
ports of the Interstate Commerce Commission give the
corresponding facts for the United States, so that fairly
accurate comparisons can be made.

The French railways are not strictly government
institutions, but the relation between the state and the
railroads is very close, so that railway employees have
the status, in a sense, of public functionaries. Certain

284 GUNTON'S MAGAZINE [April,

financial obligations of the French roads are guaranteed
by the government, and in return the state exercises a
large measure of authority in the general conduct and
policy of the system. There were in the year 1896,
251,971 persons employed on the French railroads. In
the same year there were 826,620 employees on the
railroads in the United States. In- France, 80.54 per
cent, of all the employees received a daily wage of
$1.013 or under. In the United States, only 7.22 per
cent, of all the employees received a daily wage as low
as $1.00 or under. In France, 17.84 per cent, of all the
employees received between $1.015 and $1.978 per day.
The corresponding group in the United States, receiv-
ing between $1.01 and $2.00, included 78.98 per cent,
of all employees. In France, only 1.47 per cent, re-
ceived between $1.98 and $2.943 per day, while in the
United States 11.54 per cent, received between $2.01
and $3.00. In France, 0.15 per cent, received over
$2.945. In the United States, 2.25 per cent, received
$3.01 or over.

This does not represent the exact truth, however,
with regard to the total income of employees on French
railroads; in certain groups of service there are extra
forms of compensation. This is especially true in the
case of locomotive engineers and firemen, and the re-
port from which we are quoting cites the case of en-
gineers on the Eastern Railway who receive in premi-
ums and gratuities an amount averaging 69 cents per
day, which makes their total daily wage $2.10; while
the firemen receive extra amounts averaging 36 cents
per day, making their total income about $1.25 per day.
These, however, are the highest wages cited for en-
gineers and firemen in France, and the report observes,
after commenting on these extra sources of income,
that "the table clearly shows, however, the great pre-
ponderance of high wages in American as compared

i899.] LABOR ON EUROPEAN RAILROADS 285

with the French railway service. . . . The great
bulk of French wages are under 5.26 francs ($1.015) a
day."

In Belgium the railroads, or at least those from
which the figures in this report are taken, are owned
and operated absolutely by the government. The stat-
istics are given in somewhat fragmentary form, and it
is necessary to reduce them from annual to daily rates
(counting 300 working days to the year) in order to
make comparison with corresponding figures in the
United States. For station masters in Belgium the
daily rate was, in 1896, $1.62; station agents in the
United States received $1.73. The American average
is small because of the large proportion of insignificant
stations throughout sparsely settled regions. Black-
smiths and masons in Belgium received between 58 and
77 cents per day, and machine tool hands between 39
and 85 cents per day; nearly all of the latter, however,
getting less than 62 cents. In the United States the
employees most nearly comparable to these are machin-
ists, carpenters and * 'other shop men. " These received,
in 1896, $2.26, $2.03 and $1.69 per day, respectively.
Enginemen in Belgium received from 88 cents to $1.18
per day; in the United States an average of $3.65 per
day. Firemen and brakemen in Belgium received an
average of about 73 cents per day. In the United
States firemen received $2.06 per day, and trainmen
other than conductors $1.90. Ordinary laborers on the
Belgian roads received between 39 and 97 cents per
day, but 95 per cent, of them received less than 58
cents. In the United States the group classified as
" All other employees and laborers" received $1.65 per
day. The report, in commenting on the Belgian fig-
ures, says that they " must suffice to show the very low
rate of remuneration prevailing on the Belgian State
railways."

3«6 GUNTON'S MAGAZINE [April,

In Prussia also, the railroads are owned and oper-
ated by the government. The peculiar method of pre-
senting wage statistics in Prussia makes it very difficult
to give detailed comparisons. The rates of pay are
graduated according to length of service, and all that it
is possible to give is the minimum and maximum
amount paid or that may be paid under this arrange-
ment. There is no way of telling the number of em-
ployees at any particular rate.

Station masters of the first class begin with $571.20
per year, and may attain to $999.60 per year. Those of
the second class begin with $428.40, and may attain to
$714.00. Locomotive engineers begin with $285.60 and
may attain to $5 2 3. 60. Firemen begin with $214.20 and
may attain to $357.00. Conductors begin with $190.40
per annum and may attain to $285.60. Clearly, with-
out knowing the number of employees at various rates
between these top and bottom figures, it is impossible
to make definite comparisons with American wages. As
a rule, however, it will be seen that even the maximum
rates allowed are considerably less than the average in
the United States, with the possible exception of station
masters, a position that seems to rank somewhat higher
in Europe than "station agents" in this country. The
report, in commenting upon these figures, says that
they "show the average scale of wages to be compara-
tively low in Prussia."

It should be stated that on most of the railways of
continental Europe there are certain additional benefits
which, if expressed in money, would somewhat increase
the wage income of the employees. For instance, in
France there is a state pension fund out of which
superannuated employees may be paid, during the
balance of their lives, a certain proportion of their
previous salary. The age limit is from 50 to 55 years,
and required term of service from 20 to 30 years; vary-

I899-] LABOR ON EUROPEAN RAILROADS 287

ing on different roads. Employment, also, is quite
stable. Wages are continued in whole or in part during
temporary sickness, and a considerable amount of free
or reduced rate transportation is given to employees.
Allowances are also made for relief during disability
due to sickness or accident. Some roads give free
medical service to employees, and establish co-operative
stores.

In Belgium there is a pension and relief fund,
almost exclusively for the benefit of the men in the
lower and intermediate grades of employment. Out of
this fund grants are made for help in case of temporary
disability, also for free medicines and medical attend-
ance, burial expenses, and pensions in certain cases of
permanent disability. Considering the fact, however,
that the principal contributions to this fund are made
by the employees themselves, it is not exactly a labor
"bonanza." The government deducts 3 per cent, of
all wages not over 46 cents per day, and 4 per cent, of
all wages above that sum, to maintain this pension and
relief fund. The management of the fund, moreover,
is entirely in the hands of government ministers, and
grants from it are subject to ' ' the most minute regula-
tions."

In Prussia no special advantages are enumerated in
the report, although of course the employees come
under the operation of the national pension and labor
insurance system, which applies to all kinds of industry
throughout the empire.

In Saxony there is a relief fund which was origin-
ally maintained chiefly by contributions from the
government and by contributions from and fines im-
posed upon the employees. Now, however, the con-
tributions from the employees have ceased. There are
two pension funds, managed under the national pension
system of Germany, and to one of these all the railway

988 GUNTON'S MAGAZINE [April,

employees are compelled to belong, and contribute
weekly amounts ranging from 3.3 cents for employees
receiving less than $83.30 per year to 7.1 cents for
those receiving more than $202.30 per year. Member-
ship in the other fund is required only under special
conditions, and the contributions from the employees
range from 6.7 cents per week for those whose wages
are under 43.6 cents per day to 18 cents for those who
get more than 95.2 cents per day.

Many of these extra advantages on the continental
railways are shared by employees of American railways
without the intervention of law on the subject. For
instance, on most of the systems in this country a rea-
sonable amount of free transportation is granted to em-
ployees, and, except perhaps in the lowest grades of
service, wages are continued in whole or in part during
temporary disability due to sickness or accident. On
the large systems employment is comparatively stable,
and if for the country at large it is less stable than in
Europe, this is due to the newness of very large sections
of our country and the changeable nature of the traffic.
So large a portion of our total railroad mileage consists
of comparatively new lines, running through sparsely
settled sections of territory, that in the nature of the
case there cannot be that steadiness of business (and
hence of employment) that prevails in long settled,
fully developed communities such as the old countries of
continental Europe. The difference in stability of em-
ployment seems to be due to physical and geographical
causes rather than the character of the ownership and
management.

While it is true that some of the European systems
are in advance of our own in respect to insurance and
pension funds, it should not be forgotten that these ap-
ply, with the possible exception of France, not merely
to railroads but are a part of a general state labor in-

1 899-] LABOR ON EUROPEAN RAILROADS 289

surance system, particularly in Germany. Further-
more, considerable assistance of the sort furnished by
state pension and insurance funds in Europe is supplied
in this country by voluntary associations of employees.
One of the most conspicuous features of all our impor-
tant organizations of railway employees is an insurance
fund, and on some of the large systems the corporation
maintains and contributes to similar funds. Indeed, at
a recent convention of American railway superinten-
dents, the question of insurance and pension funds to
be inaugurated by the companies was thoroughly dis-
cussed, and it was found that the principal opposition
to such a plan comes from the employees themselves.
They apparently desire to retain in their own respective
organizations the power and prestige secured by inde-
pendent management of so important a feature. The
objection to a company system, which should involve
deductions from employees' wages for the maintenance
of such funds, is so strong in many sections that laws
have been passed by state legislatures prohibiting rail-
way corporations from forming mutual relief societies
and compelling employees to join the same.

Of the voluntary relief associations among railway
employees in this country the most prominent are: the
Order of Railway Conductors, having a membership
(1896) of 19,810 and a total outstanding insurance held
by members of $29,267,000; the Brotherhood of Rail-
road Trainmen, with a membership of 22,326 and out-
standing insurance amounting to $25,357,600; the Broth-
erhood of Locomotive Engineers, with a membership
of 30,309 and outstanding insurance of $40,344,750; the
Brotherhood of Locomotive Firemen, with a member-
ship of 24,251 and outstanding insurance to the amount
of $34,424,500; the Brotherhood of Railway Trackmen,
with a membership of 1,250 and outstanding insurance
of $1,250,000. The total membership of the brother-

290 GUNTON'S MAGAZINE [April,

hoods having relief and pension departments is about
100,000, of whom 80,000 are insured; while the relief
departments conducted by railroad systems for the ben-
efit of their employees have a membership of about
125,000; and both methods of furnishing insurance re-
lief are rapidly growing. These are in addition, of
course, to voluntary insurance in private companies.

But if it is true that the employees of European
systems have certain superior advantages in the way of
universal pension and insurance relief, stable employ-
ment, and occasional gratuitous additions to income,
there are other features of quite a different character
that should not be overlooked. For instance, labor or-
ganizations on the European systems are practically un-
known, or where existing at all are entirely ineffective.
There is a national trade union of railway workers, in
France, with an estimated membership of about 30,000.
This, however, has practically nothing to do. Once
during 1898 it got as far as to threaten a strike, but it
did not occur; the union did order a strike several years
ago but it was immediately suppressed. The organiza-
tion publishes a weekly newspaper, which was sen-
tenced in 1898 to pay damages for some offense or
other, and was re-organized under a different name.
The tone of the paper is said to be violent, which is per-
haps the only obstreperous feature of the entire organi-
zation. In France also, the employee's right to com-
pensation in case of accident is covered by the insurance
system, and consists only of very ordinary relief during
illness, or a small pension to his surviving relatives in
case the accident is fatal.

In Belgium, any organization of railway employees
is absolutely prohibited. Consequently, of course,
there are no such unions, and never have been any
strikes ; ' * the only methods of obtaining an improve-
ment in the conditions of railway employment being

IS99-J LABOR ON EUROPEAN RAILROADS 291

by direct petition, by waiting for the initiative of the
minister, or by agitation in the Legislature." Further-
more, no railway employee may accept any elective
office in the government, or engage in any other trade
or profession, or take part in the management of any
society or any industrial or commercial establishment,
except by special permission. Employees must live in
the localities assigned to them by the minister of rail-
ways, and cannot move without his permission.

In Prussia, applicants for positions on the state
railways must show in addition to other qualifications
that they have not been ' ' connected with any revolu-
tionary associations or movements," and they are pro-
hibited by law from taking part in any such organiza-
tions. In the language of the report from which we
are quoting, " An energetic, radical trade union, such
as the Amalgamated Society of Railway Servants in
England, would probably fall under this category.'*
The result is, of course, that no such trade unions
exist. Employees « ' must work beyond the prescribed
period and at unusual hours, if necessary," and all em-
ployees are compelled to join the insurance and pension
funds, and consent to certain wage deductions for the
maintenance of such funds. The bulk of the contribu-
tions to these funds, however, come from the state and
the employers.

In Saxony, every railway employee before enter-
ing on his duties * ' must swear obedience to the king
and to the constitution, and to the particular provisions
applying to his position." He must obey the orders
of his superior, whether such orders are in accordance
with the rules or not; he cannot accept any presents
except with the consent of his superiors. No employee
* ' may live in any other place than that in which he
works, nor change his place of residence without the-
knowledge and consent of his superiors." No employee

292 GUNTON'S MAGAZINE [April.

can have any secondary occupation or take part in the
conduct of any other business from which any remun-
eration can be drawn ; ' * neither can his wife nor any
other person in his household conduct a business for
which special license or permission is necessary without
the consent of his superiors, and this consent may be
subsequently withdrawn." The employee "may be
dismissed not only when he has violated the rules of
duty but when his financial means are in such a state
that he cannot live in the manner demanded by his
position."

It is fair to submit that American railway em-
ployees would not consent to surrender their right of
free organization, personal liberty in the matter of
residence and of interests aside from their railway em-
ployment, and right of action for damages against the
•employing companies, for double or three times the
semi- charitable benefactions, special gratuities, free
passes, cheap meals, or even insurance relief, granted
-on any of the state owned or supervised railways of
-continental Europe.

The comparisons of wages that we have presented
•do not, of course, mean that conditions on the Euro-
pean railways in this respect are absolutely bad. Ex-
cept for the arbitrary restrictions on personal liberty
they are perhaps no worse than the average labor con-
ditions in other industries demanding a similar quality
of labor, in those countries. Furthermore, it may be
urged that the lower rates of wages in Europe are off-
set by a lower cost of living, and in small part this is
true. Differences in nominal rates should not be taken
to represent the exact difference in the actual condi-
tions. As we have pointed out several times before,
however, in other comparisons between European and
American wages, the difference in the cost of living for
the same general scope of expenditure and quality of

1899.] LABOR ON EUROPEAN RAILROADS 295

commodities is very much less than is generally supposed.

The aggregate cost of living of the American
laborer is greater than that of the European, but so far
from this being evidence of an inferior status it indi-
cates precisely the reverse, because the great bulk of
this higher cost consists not of more expensive com-
modities but of a broader range of social expenditures.
His house rent is more, but he has a larger, cleaner,
more sanitary and better house. His food costs him
more, not because it is dearer in price, for many things
are cheaper, but because he has a decidedly better and
more varied dietary. If his clothing expenditure is
larger it is chiefly because he has a larger assortment of
garments and buys new styles more frequently. It is
hardly necessary to add that there is no country in the
world where the working people spend so much for
sundries, — furniture, carpets, books, papers, amuse-
ments, travel and recreation, as in the United States.
In other words, the higher wages in the United States
do represent an actually superior condition of social
well-being, to the extent probably of four-fifths at least
of the higher nominal wage rate.

So far as these comparisons have any value as
bearing on the relative efficiency of public and private
management, the significant point is, as we have before
intimated, that with wage rates so much lower on the
European systems the charges to the public for services
are practically as high as in this country. So large a
portion of the expense of railway operation consists in
wages of labor that we ought to expect to find much
lower charges for service where labor can be procured
so much more cheaply. On the contrary, we find not
only the charges quite as high on the European roads
for corresponding service, but the accommodations and
quality of service distinctly inferior in almost every
respect to what are offered on American systems. This

»94 GUNTON'S MAGAZINE

simply means that, in proportion to the wages paid and
quality of service rendered, rates in Europe are con-
siderably higher than in the United States. There
seems to be no escape from the conclusion that, as com-
pared with American roads, there is in the operation of
the European a large element of waste, due to inferior
methods, unnecessary crowding of the service with
supernumeraries, and less efficient direction of affairs.
The number of employees per mile on these systems as
compared with the United States is larger than the dif-
ference in density of traffic would warrant, owing
evidently to less effective disposition and organization
of labor forces.

This is true to some extent even in England, be-
cause of the well-known conservatism of ideas, reluc-
tance to adopt new methods, and the comparatively
static, thoroughly established, reliable nature of the
transportation business in an old, thickly populated,
and geographically small country. Similar conditions
exist on the Continent; and, in most of the continental
countries, where until recently the general industrial
movement has been sluggish, the innovations few, and
government authority is highly centralized and arbitra-
ry, it was possible to transfer the railroad systems to
public control without much loss of efficiency. But, as
the capitalistic industries of Germany, for instance, ap-
proach American standards in other respects, the dead-
ening influence of government monopoly will become
more and more apparent in her railroad system. Al-
ready we hear eulogies of Germany's remarkable prog-
ress and excellent methods in manufacture, and, simul-
taneously, complaints of relatively poor transportation
service. The railroad system is lagging behind, while
Germany's railroad employees are compelled by law to
stand aloof from the great political or economic move-
ments of the laboring classes.

SCIENCE AND INDUSTRY NOTES

On January I3th, 18^58, the famous Great Eastern,
then the largest ship in the world, was launched. The
vessel was a complete failure and was
eventually sold to junk dealers. Forty-
one years and one day later (January
I4th, 1899) the largest ship ever built, the Oceanic, of
the White Star Line, was launched at Belfast, Ireland.
The Oceanic is 704 feet long, will have a displacement
of 28,500 tons, when fully loaded, and be capable of
developing 28,000 horse-power. The Great Eastern
was 692 feet long, had a displacement of 27,000 tons, at
maximum draught, and could generate only about
6,000 or 7,000 horse-power. This was altogether dis-
proportionate to the size of the vessel, and because of
the Great Eastern s failure it was supposed that a pas-
senger vessel of such immense size could never be suc-
cessfully navigated. But in the course of forty years of
scientific progress we have now reached the point where
a ship considerably larger than the Great Eastern can
be launched with entire assurance of success, because it
is right in line with the normal possibilities of the
times.

United States Consul- General Wildman, at Hong
Kong, in a letter to the editor of the Age of Steel,
Machinery vs. speaks of Chinese cheap labor as the
Cheap Labor chief obstacle at present to the introduc-
in China j.«on Q£ machine methods of production.

"Although several surveys have been made for rail-
roads," he says, "and all the open ports are reached by
foreign steamers, we are still living in the age of flesh
and blood. Among the masses American tools have'
hardly gained an entrance. In the great quarries on
this island there is not a single steam drill, and so long

995

296 GUNTOWS MAGAZINE

as labor remains at ten cents a day stones will be quar-
ried by hand, timber sawed, bricks made, piles driven
and goods transported. Machinery at present cannot
compete with cheap labor, and the only tools that have
gained a footing on this coast are the tools of warfare,
and even these are the cheapest kind."

In China, as elsewhere, poverty and hand-labor
methods of production are but two sides of the same
fact. Only with the advent of machinery is production
possible on a scale sufficient to give anything more than
the merest necessities of life to large masses of popula-
tion. The factory system will become permanently
established on a large scale in China only as the stan-
dard1 of living of the people rises so as, first, to make
machine methods cheaper than hand labor, and second,
to supply an adequate market for the products of manu-
facturing industry. On the other hand, one of the first
influences in developing this higher standard of living
will be the introduction of such factories as can find
markets chiefly outside of China, for some time at least.
The two forces will operate side by side, each re-acting
on and stimulating the other, as has been the case in
Japan. The foreign syndicates that are now engaged
in obtaining railway and other industrial concessions
in China are not exactly boards of foreign missions, but
they will open the way for the regeneration of China in
all the higher social and ethical respects more effective-
ly, probably, than any agencies that have ever yet en-
tered the Flowery Kingdom.

CURRENT LITERATURE

DEVINE'S " ECONOMICS "*

This book is intended for class-room work in col-
leges and high schools, as well as for general reading.
The feature most worthy of commendation is its treat-
ment of economic problems from a progressive social
rather than a purely static and mechanical point of view.
The author endeavors to portray the social effects of
various economic conditions and industrial tendencies,
and gives some practical suggestions as to how social
progress may be promoted.

We are disappointed to find, however, that the use-
fulness of the work is seriously impaired by the author's
attempt to embody in it the abstruse and metaphysical
1 ' final utility " theory of value. We have yet to find a
book devoted to the explanation of that doctrine which
is not extremely difficult for even an adult mind to
follow, and particularly so because of the inability of
that theory to give one any practical grip, as it were, on
the subject as a guide to practical conduct. We do not
find that Mr. Devine's treatment of this doctrine im-
proves its clearness in any important particular; but, on
the contrary, he brings in certain seemingly unneces-
sary contradictions.

For instance, in discussing the money question, he
definitely abandons his utility theory of value and
adopts the old supply-and-demand doctrine in its most
antiquated and arbitrary form. Thus, he says that in a
community having no business relations with other
communities, the general level of prices would be high
or low in proportion to the quantity of money in circu-
lation,— ' ' a large quantity giving high prices and a small

* Economics, by Edward Thomas Devine, Ph. D. Cloth ; 404 pp.
The Macmillan Company, New York. $1.00.

297

*98 GUNTON'S MAGAZINE [April,

quantity correspondingly low prices." Not necessarily.
The particular terms in which prices will be expressed
at any given time depend on the value of the standard
coin, determined by the cost of producing the dearest
required portion of the metal of which that coin is
made. A diminution in the quantity of money is fol-
lowed by efforts on the part of the people to supply the
lack by other methods, such as book accounts, increased
use of checks and drafts, or, as in panic times in great
money centers, by clearing-house certificates. There
is no definable relation between prices and the quantity
of money. Of all the instruments that serve the pur-
pose of money, in this country, only about five per cent,
is coin or paper currency, and a large proportion of that
is not in active circulation at all. Several hundred
million dollars are in the government vaults, and large
additional quantities are stored away by private indi-
viduals. In fact, the part played by coin or currency
in the total exchanges of the country is relatively so
small that an alteration in its quantity has no material
effect on prices. Per capita circulation in this country
has been steadily increasing for the last twenty-five
years, and during the same period prices of most com-
modities have been falling quite as steadily; instead of
rising, as should be the case according to this theory.

However, the significant point in this connection is
that Mr. Devine should thus boldly adopt the old sup-
ply-and-demand doctrine, immediately after having
developed with great care what he considers the only
specifically correct doctrine of value, viz: the "final
utility " of the things exchanged.

Mr. Devine adopts Professor Clark's definition that
value is "the measure of effective utility " of a com-
modity, and appears to think that this firmly establishes
utility rather than cost as the element which deter-
mines value. But in the explanation which he itn-

I899-] DEVINE'S "ECONOMICS" 299

mediately proceeds to give of this " effective utility,"
he unwittingly makes it entirely clear that it is cost
that determines the matter after all. For instance:
" Its effective utility is the extent to which the satisfac-
tion of the desire is dependent upon the particular
commodity. A glass of water has great utility if it
quenches intense thirst, but if, on the loss of a glass of
water, another could be substituted without the slightest
labor or inconvenience, its effective utility is zero."
Exactly. And he might have added that if another
glass could be obtained by a very little effort, then its
effective utility would be determined by the extent of
that effort; or if another glass required a great deal of
labor and trouble, its effective utility would be high to
the extent of that labor and trouble. But the labor of
reproducing a commodity is a matter of cost, pure and
simple, and therefore cost is all there is to this " effec-
tive utility " which is advanced with so much ceremony
as a new idea in economic theory.

In concluding his treatment of this subject the
author summarizes the matter by saying that the mar-
ket value of a commodity ' ' is determined by its final
utility to the last consumer whose co-operation is
necessary to exhaust the supply." This is the familiar
doctrine whose fallacy we have shown on many previous
occasions. It leads to the logical conclusion that the
price which the poorest purchaser is willing to give for
an article will determine the value of the whole supply,
and this without reference to what it costs the pur-
chaser to put it on the market. There is only one con-
dition in which this might be even approximately true,
and that is in the case of a wholesale slaughter of the
stock of a bankrupt concern. Even then the prices at
first are often much higher than when the last rem-
nants are being closed out.

In the regular course of industry no man will con-

300 GUN TON'S MAGAZINE [April,

tinue producing and selling goods which, do not at least
command a price sufficient to reimburse him for the cost
of production. This being true, the willingness of all
would-be purchasers to give less than the cost price of
a commodity has no effect whatever on its value. The
willingness of sweatshop workers to give ten dollars
for a carriage has no influence upon the price of car-
riages, notwithstanding the fact that the market may
be largely over-stocked with them. Rather than sell at
less than the cost price, the manufacturers will hold on
to their stock and curtail production until that portion
of the community which is willing to give the cost
price has carried off the surplus supply. If manufac-
turers were in the habit of acting in accordance with
this final utility idea, they would produce an unlimited
quantity of carriages without the slightest reference to
the possible smallness of the group able to pay the cost
price of such a luxury. They would produce as many
carriages as there are families in the country, and the
purchasing capacity of the poorest group of them all
would determine the price of the whole carriage supply.
Of course, nothing of the sort occurs. The manufac-
turers know what they must get for a carriage in order at
least to cover the cost of its production, and will not per-
manently produce a larger number than they anticipate
can be sold to the class of people able to pay that price.
Indeed, Mr. Devine practically establishes this fact
himself by another all-important concession at the close
of this chapter. He says: "If all of the supply is not
taken by persons to whom it has a higher final utility,
it is the final utility to its owner that determines the
value of what remains." Of course this gives away the
whole case. To the owner, the utility of commodities
that he is regularly producing for sale is not their
utility to him for purposes of personal consumption,
but it is entirely a matter of unwillingness to part with

i899.J DEVINE'S "ECONOMICS" 301

the goods at a price less than will at least reimburse
him for their cost. The only interest he has in them
is that he may exchange them for something else. He
does not want them himself, and only produces them
because somebody else wants them and will give for
the articles at least as much as it costs him to produce
them. If he is a favorably situated or well-equipped
producer, he will get a profit above his cost of produc-
tion, because the price is fixed by the cost of the most
expensive producers whose supply is required.

Briefly, Mr. Devine's sentence, quoted above, is
merely another way of saying that when the price gets
down to the point where the owner would rather keep
his goods than sell them, he does keep them, and at
that point the final utility (and hence price) is deter-
mined. It is only necessary to add that this minimum
point at which the owner would rather hold his goods
than sell them is the point of his cost of producing
them. In fact, in whatever way we analyze this final
utility theory, it returns every time to the principle of
cost as the real factor that determines the ratio in
which exchange takes place.

The truth is, there is no need of all this confusion
and contradiction in treating this subject. All that is
necessary is a clear distinction of the meaning of a few
simple terms. Utility is a personal and individual
matter. It represents the usefulness of a given thing
to the individual, for purposes of consumption. The
same kind of commodity may have a great utility to
one person and very little to another. Furthermore, a
eommodity — such as water — may be extremely useful
in itself, but worthless as an article of exchange. There
is no necessary relation at all between utility and value.
Value is simply the ratio in which commodities or labor
are exchanged, and that ratio depends on the marginal
cost of production, — or, rather, of regular reproduction.

ADDITIONAL REVIEWS

FIRST LESSONS IN Civics; a Text-book for use in
Schools. By S. E. Forman, Ph. D. (Johns Hopkins.)
Cloth, 192 pp. American Book Company, New York.
60 cents.

This little volume was ' ' prepared for use either in
the upper grammar grades or in the first years of the
high schools." The method of treatment is accordingly
quite elementary, and seems to be well suited to the
capacities of students in the grades mentioned. A
commendable feature is the logical and natural method
of developing the subject, beginning first with the gov-
ernment of self, then of the family, then of the school,
and thus broadening out into a treatment of the indi-
vidual as a citizen, his rights and duties, and finally the
character, powers and purposes of the government
under which he lives.

In the sections on town and county government,
cities, and the national government, the author greatly
increases the interest and practical usefulness of his
work by showing briefly the historical development of
these institutions of government from their early be-
ginnings.

The book is somewhat wanting in practical sugges-
tions as to the duties of government and general prin-
ciples which should guide it. This, however, lies out-
side the field of a work strictly devoted to explanation
of civic institutions, but it would be a great gain if text-
books on civics were combined with elementary treat-
ment of practical statesmanship, in such a way as to
leave the student with some broad general principles as
to what the state properly can and ought to do, as well
as merely giving him a description of the methods by
which it works.

302

ADDITIONAL REVIEWS 303

THE IMPERIAL REPUBLIC. By James C. Fernald.
Funk & Wagnalls Co., New York and London. Cloth,
192 pp. Five maps. 75 cents.

This book is written in the same attractive, vigor-
ous style that characterized the author's companion vol-
ume, "The Spaniard in History," issued last year. It
seems to us, however, that Mr. Fernald's historical per-
ception is superior to his philosophic insight. His
book is a continuous argument for territorial expansion
of the American Republic. "The. distance from Cuba
to the Philippines," he says, "is not to be compared
with the distance from the ideal of a hermit nation to
the ideal of a missionary nation." The implication that
the nation whose example and progress has furnished
one of the greatest influences in civilization during the
present century is in any sense a hermit nation because
it has not had foreign political complications, or that
extension of its political authority is necessary in order
that it may be in a true sense a missionary nation, is
of course entirely untrue in fact and unsound in theory.

We can heartily endorse Mr. Fernald's principal
conclusion, however; though it seems to contradict his
own argument. He says, for instance, that we cannot
return the Philippines to Spain, nor abandon them as
"a derelict in the path of commerce." On this point
there is substantial agreement. He then goes on to
urge that we should hold the islands "till we can trust
them to govern themselves, the first republic of the
Orient." This is exactly the proposition that we are
carrying out in respect to Cuba, and if it is followed in
the case of the Philippines it will be a policy of the
highest political wisdom, both with respect to those is-
lands and to the United States. But there is nothing
of permanent territorial expansion in this suggestion.
It is merely the recommendation that we observe the
course manifestly dictated by humanity and political

3o4 GUNTON'S MAGAZINE [April,

necessity, in preventing chaos and overseeing the de-
velopment of self-government in the Philippines, until
they are able to go alone. Mr. Fernald is much wiser
in this suggestion than in his enthusiastic argument on
quite the opposite tack, to which the book is devoted.

NEW BOOKS OF INTEREST

HISTORICAL AND DESCRIPTIVE

Cuba and Porto Rico. By Robert T. Hill. The
Century Co., New York. 500 pp. 160 illustrations.
$3.00. Mr. Hill is of the United States Geological
Survey, and naturally his book has a trustworthiness
not to be found or expected in the average war corres-
pondents' descriptions, now so common. Other islands
of the West Indies than Cuba and Porto Rico are also
covered in this work.

European History: An Outline of its Development.
By George Burton Adams, Professor of History in Yale
University. With maps and illustrations. Half leather.
577 PP- $1.40. The Macmillan Co., New York and
London. This is intended for use in high schools and
some college classes, and, because of the complete
bibliography and references, may be used as a guide to
more thorough study on various phases of the history
of Europe.

ECONOMIC AND SOCIAL

Social Elements; Institutions — Character — Progress.
By Charles Richmond Henderson, D. D. Charles
Scribner's Sons, New York. Crown 8vo. 405 pp. $1.50.
This is an attempt to outline quite definitely the exact
field of sociology, and its relation to economic progress
and practical statesmanship. Dr. Henderson discusses
practical present-day problems, and the available
methods of improving the conditions he describes.

Value and Distribution : An Historical, Critical and
Constructive Study in Economic Theory. By Charles Wil-

i899.] NEW BOOKS OF INTEREST 305

Ham Macfarlane, Ph. D. J. B. Lippincott Co., Phila-
delphia. Cloth, 318 pp. $2.50. This is a review of
the whole field of economic theory, particularly on the
question of value and the dependent problems of rent,
interest, profit and wages. The author advances some
new considerations of his own on these points, but chiefly
it is an attempt to correlate the Austrian ' ' marginal
utility" theory with the older " so-called orthodox
school of economists."

The Development of English Thought. By Simon N.
Patten, Professor of Political Economy, University of
Pennsylvania. The Macmillan Co., New York. Cloth,
8vo. $3.00. Shows the relation between economic
conditions and national ideas and movements, as illus-
trated in English history.

POLITICAL

Democracy: A Study in Government. By James H.
Hyslop, Ph. D. Charles Scribner's Sons, New York.
i2mo. 300pp. $1.50. This book seems to have been
inspired largely by Lecky's great work — "Democracy
and Liberty." Dr. Hyslop holds that democratic insti-
tutions at present are too simple for the vast problems
of modern industrial life, and require modification.

The Lesson of Popular Government. By Gamaliel
Bradford. 2 vols. Cloth; gilt tops. 520-590 pp. $4.00.
The Macmillan Company, New York and London. This
is a review, criticism and analysis of popular government,
in theory and practice, as it has existed during the present
century. He discusses English and French experience,
then passes to the United States, and dwells on the legis-
lative and executive features of state, municipal and
national political institutions. He argues for increase of
executive and decrease of legislative authority.

THE BEST IN CURRENT MAGAZINES

The April Review of Reviews has a timely illustrated
article on "Kipling in America"; also a discussion of
"Material Problems in the Philippine Islands," by
Samuel W. Belford.

There is an excellent article in Gassier s Magazine
for April, by Thomas Hitchcock, on "Industrial Impe-
rialism; the Growth of Gigantic Industrial Corpora-
tions."

"New England Governors in the Civil War" is the
subject of an interesting illustrated article by Elizabeth
Ballister Bates in the New England Magazine for April.

The April Cosmopolitan has an article by F. W.
Morgan on "Recent Developments in Industrial Organi-
zation," upon which Editor Walker makes some very
sensible editorial criticisms.

Dr. Henry van Dyke contributes a story of life in
the Adirondacks, entitled "A Lover of Music," to the
April Scribners\ and Professor William James, Har-
vard's well-known psychologist, has a suggestive
article on "The Gospel of Relaxation," urging a more
moderate pace in American business and social life.

The Century for April contains an illustrated article
by Admiral Sampson on * * The Atlantic Fleet in the
Spanish War."

H. B. Marriott Watson begins in the April Harper s>
a romance — "The Princess Xenia;" and there is a good
anecdotal article on ' ' Cromwell and his Court " by
Amelia Barr.

"Improvement in City Life" is the subject of a
series of papers commenced by Charles Mulford Robin-
son in the Atlantic Monthly for April. Professor John
Fiske opens the number with a paper on "The Mys-
tery of Evil."

306

INSTITUTE WORK

CLASS LECTURE
LABOR, CAPITAL AND THE STATE

The relation of the state to the opposing groups of
industrial interests, as capital on the one hand and labor-
on the other, is one of the most important subjects im
public policy. It has been a permanent subject of pub-
lic controversy ever since the dawn of capitalistic pro-
duction, but at no time has it been of such immediate
importance as to-day. Every year brings capital and
labor into sharper and more decisive relations, involv-
ing more and more of the general public welfare-
Capital is everywhere tending to concentrate and or-
ganize into more powerful economic groups, and labor r
on the other hand, is organizing for defensive and
offensive purposes in its demands upon capital.

What is the duty of the state in this situation? A
certain type of political thinkers would have the state
own all the capital and control the industries in the in-
terest of the public. Still another school would have
the state do practically nothing but pursue a laissez fair*
policy and leave the result to the unrestricted fight be-
tween the two forces.

Experience has demonstrated that the laissez fair e
policy is unsound in theory and unpractical in fact..
The doctrine that the state should assume entire owner-
ship and control is equally illogical and inconsistent
with all governing experience, yet the fact becomes
clearer and clearer that, in the growth of complex
society, the state has an important function to perform
in the situation. Instead of the state becoming un-
necessary as society advances, it becomes even more:
necessary, and at the same time the rights and respons-

307

3o8 GUNTON'S MAGAZINE [April.

ibilities, in short, the sphere of action, of the individual
increases with the advance of civilized society.

What is the public interest in the situation, on the
capital side ? The interest of the community is that
capital, which is neither more nor less than an instru-
ment of production, should be so used as to give the
greatest amount of product for the least expense. In
other words, that capital should be so invested in tools,
machinery and materials, and so organized, either by
individuals, firms, corporations or trusts, as to give the
greatest economic efficiency to the productive forces
employed; and so furnish the greatest amount of
wealth, service or convenience at the lowest price to
the consumers.

On the labor side the interest of the public is,
primarily, that the method of its employment shall be
such as to make the service rendered most efficient with
the least possible inimical effect upon the laborer. The
difference between pure capital and pure labor is that
capital is wealth used in the production of other wealth,
and involves only economic considerations, whereas in
labor the force is human, and the manner of its use
involves all the moral, social and political elements of
civilization. In the use of capital, therefore, the only
consideration is to make it do the maximum, no matter
whether it is used up in the process, provided it re-
produces a much larger amount. In the case of labor,
this view is no longer admitted. Public interest
demands that labor shall be so employed as not to
impair its efficiency, but, on the other hand, constantly
to increase- the social, intellectual, moral and political
capacities of the laborer.

Regarding capital as a productive instrument whose
social usefulness consists in doing its work well and
cheaply, the duty of the state is to protect it in that op-
portunity. That is to say, within the nation capital

1899.] LABOR, CAPITAL AND THE STATE 309

should be kept as free as possible from local restrictive
legislation. Every incentive that the demands of the
community for products creates for any new movement
of capital should be encouraged, but the risk, and the
expense of innovations, should all be borne by capital
itself; so that, whether in the use of inventions or new
types of organization, leading out into new industrial
fields, the losses due to bad judgment, if any, should
fall upon those who are responsible for it. That is, the
community should in no way share the losses of capital,,
but, since the community provides security and oppor-
tunity for capital, it should always share the benefits,
in the form of lower prices, better service, and greater
contribution to the public revenues for public improve-
ments. Clearly, then, for the community to get the
maximum benefit from capital it must give the maxi-
mum freedom to its operations. This freedom should
apply as much to the development of capitalistic organ-
ization as to capitalistic investment. The state should
secure the right and protect the opportunity of capital
for the greatest freedom in both these directions, up to-
the point where its organized or corporate power ceases
to minister to public welfare; as for instance when it
uses its corporate power granted by the state to increase
prices or oppress labor, or restrict the economic freedom
of others by any other means than superiority of produc-
tive ability, expressed through the means of competition.
Anti- trust legislation, and the hundred and one devices.
which are introduced into legislatures to tax, re-tax,
hamper or circumscribe in some way or other the free
action of capital, are mischievous, and are justified by
no sound principle of economics, political science or
sociology.

In the case of labor the duty of the state is not less
clear, though perhaps it is less simple. Labor is not
the competitor of capital, but its co-worker; yet the

310 GUNTON'S MAGAZINE [April,

relation is such in modern society that the laborer's
portion of the proceeds is determined by what it can, by
virtue of its power of social demand, insist upon.
Capital assumes the whole responsibility of industry,
and contracts with the laborer for a specific amount for
the services to be rendered. What this amount shall
be, and what the conditions under which the service is
to be rendered shall be, must largely be determined by
the laborer's ability to insist upon his demands in so
contracting to work. In order that his economic in-
fluence may operate to the maximum in this situation,
and thus enable him to obtain the maximum wages and
the best possible conditions, it is the duty of the state
to secure to laborers all the freedom of organization
and other conditions which are conceded to capital.
For the same reason that capitalists are becoming or-
ganized in large corporations, it has become a social
and economic necessity for laborers to do the same. It
is impossible longer for individual laborers to make ef-
fective contracts. They must work in groups for the
same wages and under the same conditions, and start
and stop at the same time, because the operation of
modern machinery requires that all stop and start to-
gether. Since all are affected simultaneously it is but the
logic of the situation that they should act as a unit; in
short, that the laborers in the various industries become
consolidated in the same way as capitalists.

In order that laborers shall have the maximum
"benefits of progress, it is necessary that the state secure
the opportunity for the greatest freedom of action in
this direction. While capital should be given the
greatest possible opportunity for its own activity, it
should not be permitted in the least to interfere with
the same freedom among laborers. A combination
among capitalists to prevent the organization of labor
should be deemed conspiracy, and be punishable. The

1899-] LABOR, CAPITAL AND THE STATE 311

•organization of labor is as necessary to modern industry
as is the organization of capital, and should receive the
same protection at the hands of the state. This is be-
coming very generally recognized by capitalists, yet
there are a few instances where capitalists act upon the
assumption that they have the right not only to organ-
ize for protective purposes but to associate for the pur-
pose of preventing labor from organizing. Protection
to economic freedom on the labor side properly requires
that membership in a trade union should not directly or
indirectly be made a ground for discharge, or any other
action inimical to the opportunity of the laborer to fol-
low his daily occupation ; and any combination of manu-
facturers or employers for such purpose should be
deemed conspiracy.

There are many reasons why the state should be
more solicitous as to the rights and conditions of labor
than of capital. Labor is in many respects not so capa-
ble of enforcing its rights as is capital. For instance,
poverty may force the laborers into submission to the
most unjust conditions, whereas capital, in any such
contest, could withstand an almost indefinite siege.
Moreover, among laborers there is a very large propor-
tion of women and children, and, in the present stage of
development of the factory system, the proportion is
augmenting.

Perhaps the greatest of all reasons why the state
should scrupulously guard the interests and rights of
labor is that upon the conditions under which laborers
are employed, the wages they receive, and the hours of
labor they work, depend their social, moral and politi-
cal character; and, since the laborers constitute seven-
or eight-tenths of .the community, their industrial con-
dition practically determines the quality of the citizen-
ship and thereby the civilization of the nation. There
is something more involved in the conditions of labor

3i2 GUNTON'S MAGAZINE [April,

than merely securing cheapness of service. As a
matter of fact, the progress of society finally depends
upon the improvement in the industrial and social con-
dition of the wage class, and this can only come in the
last analysis through conditions which will give higher
wages and lower prices; — economy on the capitalist side
of production, and ever-increasing expensiveness on
the laborer's side, as a consumer. Nor is this at all in-
imical to the interests of capital. On the contrary, it is
the very foundation of successful capitalistic develop-
ment, because every expansion of the laborers' con-
sumption adds to the market demand for capital's pro-
ductions. So that, in guarding the opportunities for
the industrial freedom and activity of the laborer and
his social improvement, the state is indirectly securing
the basis of industrial success for capital, concurrently
with raising the moral standard, the social life and
political integrity and civilization of the community.
Everything which militates against this it is the duty
of the state to prevent, and to protect and encourage
everything which directly or indirectly contributes to
this end.

In securing to laborers the maximum of freedom
in economic action, trade unions should be legalized.
The right of laborers to act collectively should be as
explicitly established as their right to act singly. All
legislation, therefore, or power of courts, through in-
junction or otherwise, to prevent this, is clearly con-
trary to the public weal as represented in the laborers*
industrial freedom.

Public interest also demands that the conditions
under which laborers work shall not be inimical to their
physical health or moral and social welfare; that they
shall not labor under conditions which tend to stultify
their moral nature or destroy the opportunities for the
expansion and improvement of their social life. One

i899- ] LABOR, CAPITAL AND THE STATE 313

of the conditions that most directly affects the social
life and character of the laborer is the length of the
working day. Experience has demonstrated over and
over again that it is both the moral and political duty
of the state to regulate, with a tendency to shorten, the
working day. To the wisdom of this the factory legis-
lation of England and the United States is a monument,
recognized of Christendom.

Another way in which the state may properly act
in the interest of labor is by providing a system of labor
insurance. Thus far, Christian civilization has provided
only pauper aid to make up for the old age helplessness
that has come with the wage system. Insurance has
come to be a part of the recognized habit of prudence in
all classes of the community financially above the labor-
ers. For them, pauper relief furnishes the last resource
of support when they are economically dislocated
by age or the movements of industrial organization.
The insurance principle, which is already applied to
other classes, and to some extent in a few cases to lab-
orers, should be made general and compulsory, and this
can only be done by the action of the state.

Briefly, then, the relation of the state to labor and cap-
ital is to protect each in the greatest freedom of action in
its own sphere, guaranteeing the maximum opportunity
for development of both, and permitting neither to in-
terfere with the organization or free collective action of
the other. Since the success of capital, the prosperity
of labor, and the welfare of the community all depend
on increasing the educational and social opportunities
of the laborers, it is the duty of the state to encourage,
protect and if necessary inaugurate every influence that
can be exercised in that direction.

WORK FOR APRIL

OUTLINE OF STUDY

In our study of practical statesmanship we now
reach one of the most important questions in the whole
season's course, — the relation of the government to
capital and to labor. The topics are Nos. IX and X in
the curriculum, as follows:

IX. THE STATE AND CAPITAL.

a Corporations and the public.
b Corporations and individuals.
c Character and influence of trusts.
X . THE STATE AND LABOR.
a Factory legislation.
b Legal rights of trade unions.
c Legal restriction of strikes ; (Injunctions).
d Hours of labor.

e The rights of non-union workers.
f Mutual labor and capitalist unions.
g Labor insurance.

REQUIRED READING

In " Principles of Social Economics," Chapters V,
VI and VII of Part IV. In " Wealth and Progress,"
the Introduction, and Chapters III to VII inclusive, of
Part III. In GUNTON'S MAGAZINE for April, class lec-
ture on " Labor, Capital and the State," also Notes on
Required and Suggested Readings. In GUNTON INSTI-
TUTE BULLETIN No. 6, lecture on "The State's Rela-
tion to Labor;" in Bulletin No. 7, lecture on "The
State's Relation to Capital;" in GUNTON'S MAGAZINE
for March, 1899, articles on "The Era of Trusts" and
" The Menace of Immigration."

SUGGESTED READING*
In Hobson's "Evolution of Modern Capitalism,"

*See notes on suggested reading for statement of what these ref-
erences cover. Books here suggested, if not available in local or trav-
eling libraries, may be obtained of publishers as follows :—

The Evolution of Modern Capitalism. By John A. Hobson, M.

WORK FOR APRIL 3*5

Chapters V and VI. In von Halle's " Trusts or Indus-
trial Combinations and Coalitions in the United States,"
Chapters I to VIII inclusive. In Howell's "Conflicts
©f Capital and Labor," Chapters X, XI, XII and XIV.
In Brentano's ' * Relation of Labor to the Law of To-
Day," Chapters VII to XVI inclusive, of Book I; and
the " Closing Considerations. " In the Social Economist
(•now GUNTON'S MAGAZINE) for September 1895, article
" Evolution of Modern Capitalism." In GUNTON'S
MAGAZINE for April, 1897, book review on von Halle's
" Trusts or Industrial Combinations and Coalitions in
the United States." Lectures in GUNTON INSTITUTE
BULLETIN (1898-99) as follows: No. 16, " Rights and
Wrongs of Trade Unions;" No. 18, "Has the Republic
a Policy?"; Nos. 19, 20 and 21, "English Social Re-
form Movements;" No. 25, "Trusts and Watered
Capital;" No. 27, " Moral Reasons for a Shorter Work-
ing Day." Also, reference may be had to John Rae's
"Eight Hours for Work;" the pamphlet "Combinations,
Their Uses and Abuses, with a History of the Standard
Oil Trust," by S. C. T. Dodd; and pamphlets "Econom-
ic and Social Importance of the Eight- Hour Move-

A. Charles Scribner's Sons, New York. 383 pp. $1.25. Trusts or
Industrial Combinations and Coalitions in the United States. By
Ernst von Halle. The Macmillan Co., New York. 350 pp. $1.25.
The Conflicts of Capital and Labour. By George Howell, M. P. The
Macmillan Co. , New York. 536pp. $2.50. The Relation of Labor to
the Law of To-Day. By Dr. Lujo Brentano, University of Leipsic.
Translated by Porter Sherman, A. M. G. P. Putnam's Sons, New
York. 305pp. $i.?5-. Eight Hours for Work. By John Rae, M. A.
The Macmillan Co., New York. 340 pp. $1.25. The copies of GUN-
TON'S MAGAZINE and the GUNTON INSTITUTE BULLETIN, and Prof-
fessor Gunton's pamphlets on the eight-hour movement and the
trust question, may be obtained of this office on receipt of price.
Price of the pamphlets is 10 cents each. The pamphlet on Combina-
tions, J^heir Uses and Abuses, with a History of the Standard Oil
Trust, is published by George F. Nesbitt & Co. , New York, but can
probably be obtained from the Standard Oil Company at its office, No.
26 Broadway, New York.

316 GUNTON'S MAGAZINE [April,

ment " and * * The Economic and Social Aspects of
Trusts," by George Gunton. In GUNTON'S MAGAZINE
for October 1896, article "Government by Injunction;'*
December 1896, article "Labor Insurance in Germany;**
September 1897, article "Results of German Labor
Insurance."

NOTES AND SUGGESTIONS

Required Reading. The amount of required reading
this month is considerably larger than usual. This
is inevitable, because one of the topics for study this
month — "The State and Labor" — includes certain ques-
tions to which almost the whole of the book "Wealth
and Progress" is devoted. That part of "Wealth and
Progress," however, which deals with the history and
the law of wages comes more properly under the course
on Social Economics, and the chapters we have suggest-
ed for this month deal specifically with the question of
legal restriction of the hours of labor. The points dis-
cussed in these chapters are "Economic Effect of Re-
ducing the Hours of Labor," "The Effect of an Eight-
Hour Law upon Profits," "What Would Be its Effect
upon Rent?" "Feasibility of Short-Hour Legislation,"
and "Phenomenal Effect of the Ten- Hour Law and
Half-time Schools in England." This last chapter is
especially important, because it presents the remarkable
testimony afforded by English experience confirming
the wisdom of short-hour legislation. There are two
other chapters in this book which properly should come
in this month's reading, but, for the sake of more equal
division of work, will be postponed until next month.

The chapters assigned in ' ' Principles of Social
Economics" are on . " Business Depressions," " Combi-
nation of Capital " and " Combination of Labor." The
last two, of course, are directly on the topics for this
month's reading. The subject of business depressions
comes very appropriately under the same head, because,

1899-1 WORK FOR APRIL 31?

as Professor Gunton holds, the gradual elimination of
industrial depressions is to come by means of forces in-
timately associated with the organization of labor and
capital; that is, by the increase of wages, and hence of
consuming power, which is the object of organized
labor; and, on the other side, by the scientizing of pro-
duction and exact adaptation of supply to demand,
which is the ultimate outcome of thoroughly organized
and integrated capitalistic production.

Suggested Reading. The chapters suggested in Hob-
son's "Evolution of Modern Capitalism" are on "The
Formation of Monopolies in Capital" and "Economic
Powers of the Trust." The author's attitude is one of
pronounced hostility to trusts, and probably the chap-
ters suggested contain as good a statement of the argu-
ment against these institutions as any to which we could
make reference. There are certain very important err-
ors of fact, however, in the author's discussion, which
should not be overlooked, and for this reason it would be
well to read the review of this book published in The Social
Economist for September 1895, previously referred to.

The eight chapters suggested in von Halle's volume
on trusts comprise all of the regular reading matter of
the book, but there is an appendix occupying two- thirds
of the volume, which includes copies of a number of
anti-trust laws and various documents concerning the
conduct of these organizations. The author's discussion
in the main is fair and discriminatory, but, like Mr.
Hobson, he falls into certain errors of fact which are
noted and corrected in the book review in GUNTON'S
MAGAZINE for April 1897, which we have also included
in the suggested reading.

Howell's "Conflicts of Capital and Labour" deals
chiefly with English experience, and the chapters we
have suggested discuss such matters as federations,
councils and congresses of trade unions, conciliation,

3i8 GUNTON'S MAGAZINE [April,

arbitration and co-operation, profit sharing, and the fu-
ture of trade unions. The author's general attitude is
best seen in his concluding remarks, on the future of
labor: "We hear vague declamations about getting
rid of capitalists, abolishing profits, and doing away
with wages, hiring, contracts of service, etc., and of
thereby adding to the welfare of the masses, and
promoting the prosperity of the people. Labour's
Utopia has been described as having reached the
acme of perfection under municipal law, where the
people are fed by a State-spoon, out of a State-platter,
doled out by a State official, in a State uniform. Where
the workers are no longer independent, self-reliant
men and women, but parts of a huge State machine,
moving mechanically in a State groove, under State
regulation. No such dream has actuated the writer
of these pages. He has endeavored to promote the
liberty of the subject, freedom of association, better
wages for working people, extended leisure, a high-
er standard of living, improved conditions of life and
labour, healthier homes, wider culture, and nobler aspir-
ations. To these objects his whole life has been de-
voted. If a nobler, a better, and a speedier way can
be found, he will not object; but, until it can be
demonstrated that the old methods have failed, he re-
lies upon individual exertion, and mutual help by as-
sociative effort, to at least ameliorate the condition of
the workers. If the advantages gained, and the oppor-
tunities now offered are properly utilized, the future of
labour, if it does not realize the dreams of enthusiasts, will
be improved, the workers will be elevated, the country
will prosper, and happiness will dwell in the land."

vSome of the matter suggested in this month's read-
ing was also referred to last year under the topic of
' ' Social Reforms " in the course on Social Economics.
This is true of most of the reading suggested in Bren-

I899-] WORK FOR APRIL 319

tano's . " Relation of Labor to the Law of To- Day."
This month, however, we have mentioned only the ten
chapters in the body of the book which deal with pres-
ent century experience in the organization of labor.
Chapter XII, on " Closing Considerations," was recom-
mended last year and might well be re-read now, be-
cause it is an excellent statement of the economic forces
by which the progress of labor is made, and of what
can be done to promote this movement.

John Rae's " Eight Hours for Work " is an ex-
tremely earnest argument for the establishment of an
eight- hour working day in England, and that by legis-
lation. A large amount of evidence in support of the
author's contention is embodied in the work, and any
or all of the chapters are well worth careful reading.
It must be said, however, that the keystone of Mr.
Rae's argument for eight hours as an economic propo-
sition is not the one which in reality gives the strength
and soundness to the contention. The ultimate eco-
nomic justification for shorter hours is not, as Rae
maintains, simply increased capacity for exertion on the
part of the workingman, but lies in the higher standard
of living of the laboring classes, due to the enlarged
social opportunities which leisure affords. This higher
standard of living constitutes the increasing market
upon which capitalistic industry necessarily depends
for its enlargement. Students will find a review of
Rae's book in GUNTON'S MAGAZINE for March 1895.

Mr. S. C. T. Dodd's pamphlet on " Combinations,
Their Uses and Abuses " is an argument made by him
before a senate committee of the New York State
legislature some years ago. It contains the history of
the Standard Oil Trust and a reply to the principal
charges made against it from the time of its organization
down to 1887. It gives the trust side of the controversy,
and deserves reading in connection with the chapters

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GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

SPEAKER REED'S RETIREMENT

The retirement- of Hon. Thomas B. Reed from Con-
gress and therefore from the speakership, and for the
present at least from public life, is a significant event in
American politics. The speakership, in connection
with which Mr. Reed has earned world- wide fame as
master parliamentarian, is the second highest position in
the gift of the American people. There are a few posi-
tions which command a higher salary, but none, except
the presidency, which commands so much influence,
involves so much responsibility, and requires such a
high order of statesmanship. By political friends and
enemies alike, by statesmen and students of foreign
countries, Mr. Reed is admitted to have been the great-
est speaker this country has produced.

Mr. Reed is not a politician. He is a statesman. He
is a student of political history and principles, a man
with deep convictions and practical views of public
policy. He has never been pre-eminent as an organiz-
er, but he is a strong personality. In Congress he soon
became a conspicuous figure in national affairs, not by
the power of "machine politics," either state or national,
but by strength of character, force of ideas and
political sagacity in relation to public affairs. Through
these qualities his influence in Congress and in the
nation, and his reputation as a parliamentarian and
statesman throughout the world, has steadily increased
until to-day he is admittedly the greatest man and strong-
est character in American public life.

His intellectual and political integrity are above

321

322 GUNTON'S MAGAZINE [May,

suspicion; the breath of scandal has never touched
him, even indirectly. He is too strong to be bullied
and too honest to be bought. Moreover, he has definite
and strong political ideas. He is pre-eminently an
American in the best sense of the word. From Mr.
Reed's point of view true Americanism means intelli-
gent recognition of the political and social principles
upon which our democratic experiment is being (and,
if a success, must be) made. It is a principle in his
political philosophy that no nation is intelligent enough
or great enough wisely to govern other people much
below them in civilization. If a people is in a crude
and primitive state, where democratic institutions are
impracticable and there must be despotism, the despot-
ism should be its own. If it must have a monarchy
and an aristocracy, it should not be arbitrarily super-
imposed by an alien nation with neither knowledge of,
interest in, nor affinity with the habits and traditions
of the people. Government by conquest and subjuga-
tion of part of the population by killing the rest is the
slowest and most costly and the least civilizing method
of promoting human welfare and free government.

According to Mr. Reed's doctrine, the true way to
make this nation great and to increase its influence over
less civilized countries is to broaden and strengthen in-
dustrial prosperity, social welfare and political intelli-
gence among the people of the United States. Hence
he strongly favored directing public policy towards
dealing with domestic problems of the American people,
and was opposed to the inauguration of a policy which
should undertake the military subjugation and arbitrary
civilization of groups of semi-savages in distant lands,
under any pretext whatever.

With this conviction as a firm political principle,
Speaker Reed was necessarily opposed to the annexation
of Hawaii. He was very much opposed to demanding

1 8Q9-] SPEAKER REED'S RETIREMENT 323

the Philippines, and still more opposed to paying for
them and then fighting to get possession of them. In
proportion as this un-American policy was officially
adopted he became out of harmony with the administra-
tion of which, as speaker, he was a very important
part. His convictions on this subject were too deep
and his ideas of political principle too clear to be stifled
for party emergency, and he was too much of a states-
man and patriot to become a mere obstructionist. Res-
ignation was the only consistent course open to him.
This outcome is unfortunate but under the circum-
stances it was unavoidable. Conviction and adherence
to principle is incompatible with timid optimism. One
leads to positive, definite action and the other to hesi-
tating uncertainty. This was really the case of the
speaker and the administration. Theoretically, they
both stand for the same political doctrine. In the cri-
sis with Spain, when adherence to definite principle was
most of all important, the administration slackened its
hold on political conviction and floated into the open,
apparently trusting that " something would turn up.'*
Of course the war with Spain in Cuba, and the present
sickening experience in the Philippines, were no part
of the purpose of the administration. That the presi-
dent is one of the most peacefully inclined of our pub-
lic men will not be disputed, but the administration
lacked definite purpose, lacked adherence to a policy con-
sistent with the principles underlying American institu-
tions. Statesmanship assumes the responsibility of lead-
ership. It is more than probable that when the history
of this war is written it will be apparent that not only
the so-called ''falling" of the Philippines "into our
hands," but that the war itself was largely due to this,
lack of positive policy on our part. If, for instance,
the present administration early in the controversy had
confirmed in unmistakable terms the notice served

324 GUNTON'S MAGAZINE [May,

upon Spain by the previous administration that unless
they settled matters with Cuba within a limited period,
say a year, either by establishing order and authority
or arranging some amicable conditions of self-govern-
ment, this country would interfere, Spain would un-
doubtedly have made terms with Cuba, by accepting her
offer of $200,000,000, or the later offer of $100,000,000,
for the right of self-government. But instead of this
the diplomatic correspondence was little more than
polite parleying, at which Spain is an adept. Relying
on her characteristic habit of procrastination and
quibble, the Spanish ministry believed, and with some
reason, that they could prolong the controversy in-
definitely. So, when the blowing up of the Maine
came as a decisive incident, it was too late for the
Spaniards to retreat. Popular sentiment in Spain left
the ministry no alternative but to face the situation,
though disastrous defeat was certain.

Had a firm statesmanlike policy been pursued
on our part, and Spain been made to understand that
her time for trifling with Cuba and outraging the sense
of civilized nations was limited, she could and in all
probability would have found a way to accept the ran-
som price offered by Cuba, guaranteed by the United
States, and the whole question of Cuba's freedom and
Spain's departure would have been accomplished, and
the war with all its direful consequences have been
avoided.

But, as is always the case, one bad step involves an-
other. Indecision and lack of policy in the early
months of 1897 made either a change of front or more
mis-steps in the same direction necessary in 1898-99.
Again, the lack of policy led the administration to mis-
take the enthusiasm over the success of American arms
as an expression of public opinion in favor of conquest.
Hence, in negotiating the treaty of peace, our commis-

I899-] SPEAKER REED'S RETIREMENT. 325

sioners were instructed to demand cession of the
Philippines to the United States as conquest of war,
and as a compromise agreed to pay $20,000,000 for the
transfer. The statement, therefore, that the Philip-
pines " fell into our hands" is not true, but is merely
an excuse for shifting the responsibility on to Provi-
dence, fate or accident. The result is an indefinite
war with the half savage inhabitants of the Philippines,
in which a great number of American lives will be
sacrificed and a large standing army and increased tax-
ation may be made necessary.

All this tends to show that the Republican party is
being managed rather than led, and is gradually but
surely drifting from its moorings of high principle and
moral ideas, and tending to become a party of political
expediency without fixed principle or policy.

Much that has occurred during the last two years
tends to strengthen this apprehension. On the money
question and other great issues of national importance
the Republican party has no definite standing place.
Even in the campaign of 1896, neither the candidate
for president nor the convention which nominated him
had the courage clearly to state its position upon the
great question that was to constitute the main issue of
the campaign. Whether either the candidate or the
party were for bimetallism or the gold standard, or
favored any definite policy of banking and currency,
no mortal man could tell. As the campaign proceeded
and public opinion crystallized they both became more
definite on the silver question, but on the question of
banking and currency, which is the very heart of the
financial question, nobody can yet tell what is the posi-
tion of the Republican party or the administration.
When a party, or for that matter a nation, loses its grip
on principle and settles down to a policy of mere expe-
diency it has surely entered upon the road of decline.

326 GUNTON'S MAGAZINE [May,

Neither of the great political parties to-day has
any really strong, characterful leaders. The Democrats
are rallying around a superficial, self -anointed prophet,
who is leading not by the power of experience and
tested statesmanship but by his devotion to an econom-
ic superstition. The Republican party can hardly be
said even to have a leader at all. It is being corraled
by the familiar methods of party management rather
than led by any political policy or statesmanship. The
ignorance and demagogy in the Democratic party has
practically relegated every strong character in that
party to the rear; and mediocre and mercantile meth-
ods of political management appear to be doing the same
thing in the Republican party. Reluctant as one must
be to admit it, it does almost seem as if the standard of
statesmanship is being lowered. Not that public men
are less honest and less moral, or even that the rank
and file are inferior to what they were formerly, but
there seems to be less and less room for the highest
talent and character of the nation to enter and remain
in public life.

This is no doubt partly due to the flippant and
superficial discussion of public questions, appealing to
the passions rather than to the intelligence of the peo-
ple, and so inspiring class feeling instead of civic and
national pride.

Another fact that has contributed in no small de-
gree to this seeming degeneracy — which in reality per-
haps is not degeneracy but lack of commensurate pro-
gress— is the failure properly to recompense public
officers. During the last thirty years the social stan-
dard and income of all classes has been greatly raised.
Wages have doubled, salaries have gone up, business
opportunities have increased; in fact, in every domain
of life with the advance and prosperity of the nation
-the standard of incomes has risen. Yet salaries of con-

SPEAKER REED'S RETIREMENT 327

gressmen, legislators and public officials have been kept
at a stand-still. The salary of a congressman is now so
completely behind the income of high class efficiency
in any of the professional and commercial walks of life
that first class men cannot afford to enter public life.
Banking, manufacture, railroading, commerce and in-
dustry generally pay for high class service twice and
three times and in some cases five and even ten times
what the nation pays to members of congress. Of
•course, in the nature of things, this means that a rela-
tively inferior class aspire to this position. In the
middle of the century $5,000 a year would command
practically the best service of the nation. To-day it
will only command the equivalent of a first class sales-
man. With this tendency, and the growing commer-
cial spirit in the distribution of political favors, has
come a habit, which is practically converted into a pol-
icy, of rotation of office. This means that efficient
corraling for the caucus to-day shall secure election to
congress to-morrow, the result of which is that in most
cases two terms is all that a person can expect, because
others are waiting for a place. Thus, instead of get-
ting the ripe experience and ability which permanence
and devotion to public affairs can give, we are develop-
ing a system of cheap rotation which, as compared with
the standard of character and effiicency in the profes-
sions and all other walks of life, is lowering the stand-
ard of our public service, particularly in legislatures
and in congress, where the highest statesmanship
should be developed.

In 1873 Congress, recognizing this fact, passed an
act raising the salary of congressmen from $5,000 to
$7,500 a year, and with unusual frankness included the
then existing congress in the raise, which of course
•dated the increase of salary back to 1871. This con-
gress being Republican, the Democratic party at once

328 G UNION'S MAGAZINE

made a great hue and cry about the extravagance of
congressmen and their audacity in raising their own
pay. Dating the increase back to the beginning of the
term was called the " salary grab," which was made a
political issue. The public so completely endorsed this
demagogical outcry that the next congress repealed the
act, and some of the members played the purity role to
the extent of returning their pay.

If the American people insist upon having their
public servants poorly paid they must expect only to be
able to get commensurately poor quality. The $10,000
people will not long work for $5,000, nor ought they.
It is doubtful whether the English system of no pay at
all for members of Parliament would not be preferable
to the system of low pay which will only command
mediocre and often very inferior material.

The retirement of Speaker Reed and the seeming
growth of Bryan's popularity are strong indications of
the effect of this policy. If American politics is to rise
to the high plane commensurate with the public
demands which the complex problems of modern life
have created, the American people must be educated
to regard public life as a high and important calling,
not as a cheap hackneyed thing which gives
questionable reputation to all who engage in it. We
must also learn to recognize the fact that the nation
requires the best brains and most sterling character it
can produce, that the highest qualities can only be com-
manded by the highest remuneration, and that the
remuneration for public servants must at least be com-
mensurate with the social life and standing which the
incomes from professions and industry permanently
establish. If the nation insists on paying its law-
makers and public servants less than half what the best
talent can command in other walks of life, our statesmen
will be sure to be of mediocre stuff.

THE TIN PLATE TRUST

The manufacture of tin plate is one of the recent
industries which have been brought into existence in
this country exclusively by a protective tariff. Prior to
1890 there was not a pound of tin plate manufactured
in this country. We imported all our supply, free of
duty. Under the McKinley law (1890) a duty of 2£
cents a pound was placed upon manufactured tin plates.
This immediately had the effect of establishing the
industry in this country, and we now produce our entire
supply, foreigners being unable to compete with Amer-
ican producers in the American market. The product
since July ist, 1891, has been as follows:

July i to December 31, 1891, (half year) 2,236,743

January i to December 31, 1892 42,119,192

January i to December 31, 1893 123,606,707

January i to December 31, 1894 166,343,409

January i to December 31, 1895 225,004,869

January i to December 31, 1896 369,229,796

January i to December 31, 1897 574*759,628

January i to December 31, 1898 732,290,285

Total product for 7^ years. . .2,235,590,629

Before the McKinley Law was passed, when tin
plate was on the free list, it cost $5.10 per box. After
the industry got well under way in this country the
price rapidly fell, at one time touching $2.75 a box. In
1894 the Wilson Bill reduced the tariff on tin plate to
U cents. Under the Dingley Bill, of 1897, the tariff
was raised to i^ cents, but the price did not rise.
Indeed, it has remained so low that no foreign tin can
come in.

In the fall of 1 898 the price in hundred-boxes was
$3.00 a box. This price was regarded as very low,
yielding very little profit for the best concerns and none

329

330 GUNTON'S MAGAZINE [May,

at all for poorer ones, and a loss for some of the poorest.
Competition among the various factories that the tariff
had called into existence was so severe that steps were
taken to re-organize the industry into a trust, by which
all the factories became parts of one concern. Almost
immediately after the trust was organized the price of
tin plates went up from $3.00 to $4.00 a box. This
very naturally caused consternation among the con-
sumers and a feeling of indignation in the community
that the trust was using the power of its new organiza-
tion to impose upon the public, and, instead of giving
the consumers a part of the benefit of the economy crea-
ted by the the larger organization, that it was acting
the part of a monopoly and charging one-third more,
merely for its profits.

In the March issue of this Magazine, in an article
"The Era of Trusts," attention was called to this fact.
It was suggested that if the managers of the tin plate
trust had no better appreciation of the treatment that
industry had received at the hands of the public in the
form of a protective tariff, upon which its very exist-
ence depended, than to use its organization to tax the
community by monopoly prices, its products should at
once be put upon the free list; and, in fact, that con-
gress should pass a law empowering the Secretary of the
Treasury to put upon the free list the products of any
trust that uses its re -organization to put up prices. In
nearly all cases where legitimate trusts have been or-
ganized and great economies accomplished, the manage-
ment has had the good sense to lower the price and so
give the community a share of the advantages due to
the superior methods of organization. Hence the fact
that the tin plate trust was an exception to this and put
the price up over 30 per cent, seemed to be an example
of bad business policy.

Subsequent investigation into the facts of the case,

i899.] THE TIN PLATE TRUST 331

however, shows that the managers of the tin plate in-
dustry are not quite so unwise as this rise in price
would seem to indicate. Of course, in passing upon
all such cases we should be careful to hold the trust re-
sponsible only for what it does. It has frequently hap-
pened when the price of petroleum has teetered up-
wards that the trust has been condemned as the greedy
cause, whereas a little investigation would show that it
was due to a rise in crude oil. The same has more
than once been true of sugar.

This happens to be true at least in part of tin plate.
It should be remembered that the tin plate manufac-
turers, now the trust, simply buy the pig tin and the
steel bars. They roll the bars into plates, and other-
wise prepare them, and put on the tin coating. In
other words, pig tin and steel bars are their raw mater-
ials, both of which they buy. Pig tin is all imported,
duty free, and steel bars are largely manufactured here.

Pig tin has risen from 12^ cents to 25 cents a
pound, or over 96 per cent. The price of steel billets,
out of which the plates are made, has risen from $14.-
50 to $25.00 a ton, or 72.4 per cent. Allowing about
5 per cent, for waste in converting the billets into
plates, this is equivalent to a rise of $10.50 on 1,900
pounds. Therefore, the price of the 2^ pounds of pig
tin used in the manufacture of 100 pounds of plates
has risen 30.6 cents, and the price of the steel bars
used in 100 pounds of tin plate has risen 54.8 cents,
making a rise in the cost of the two elements of raw
material of 85,4 cents per box of tin plate. Before the
rise, the steel billets used in making a box of tin plate
cost 74.1 cents, and the pig tin cost 31.9 cents, or just
$1.06 per box. Therefore the rise in raw materials in
a hundred-pound box has been 80 per cent.

When the price of the finished plates was $3.00,
the remaining $1.94 above the cost of raw materials

332 GUNTON'S MAGAZINE [May,

was made up of labor, fuel and miscellaneous expenses.
The fuel cost is about 5 cents per box of tin, and if we al-
low a nequal amount for taxes and insurance respectively,
which is more than ample, 20 cents for fixed salaries —
a very high estimate indeed — , and 9 cents for depre-
ciation and incidental expenses not enumerated, the
remaining $1.50 represents labor cost, — including the
salaries of clerks, etc. On this there has been a rise of
ii per cent., or i6^£ cents per box. Adding this to
the 85.4 cents rise in the price of raw materials makes
a total rise of $1.02 a box in the cost of manufacture,
due to the rise of wages and in the price of raw ma-
terials.

Of course, the $3.00 a box for which the tin plates
were sold in 1898 did not all represent cost of produc-
tion to the most successful factories. There were a few
of the best concerns that were making a profit when
business was at its worst and prices at their lowest; but
with the poorer mills, or those producing at the great-
est cost, all of the $3.00 represented cost of production.
They were receiving no profits, and some of them were
working at a loss. This is always the case in competi-
tive business, but it was especially the case during 1896,
1897 and 1898. That is to say, under all normal com-
petitive conditions those producing at the greatest cost
work without profit, and their cost is correctly reflected
in the selling price. Usually these producers are com-
paratively few, but in 1896, 1897 and 1898 they were
numerous; some of the poorest, as just observed, being
compelled to work at a loss. Since these dearest pro-
ducers always determine the market price it is perfectly
correct to estimate the $3.00 as representing the cost of
producing the plate, not including any profit, as those
whose cost really determine the price received no
profit.

Strictly speaking, then, the rise in wages and raw

i899-] THE TIN PLATE TRUST 333

material in the manufacture of tin plate has been
slightly more, or at least fully equal to, the increase in
the price since the trust was organized. The increased
economies of the trust probably amount to more than
this. They have probably converted what was a loss
to some, no profit to many, and a small profit only to a
few into a more liberal profit for all, and it may fairly
be expected that the trust will share this undivided
profit with the community before long in a further re-
duction of prices. We are glad, however, to be able to
believe that whatever increased profit the trust is now
making it is not getting it out of the rise of price.

It is worth noting in this connection that the price
of tin plate, with the increase of 1 1 per cent, in wages,
is still $1.10 a box less than it was when we relied on
foreign supply for all our tin plate under free importa-
tion. What has really been accomplished is this: the
tin plate industry has been transferred to this country,
whatever profits there are now go to American invest-
ors, the wages expended in that industry are distributed
to American laborers, and these have been increased
since the trust was organized 1 1 per cent. ; the produc-
ers are undoubtedly making a good profit, and still the
product is sold to American consumers at $1.10 a box,
or 22 per cent, less than before the tariff was adopted
and the trust organized.

A PICTURE OF THE PHILIPPINES
B. W. ARNOLD, JR.

The opportunity of disposing of the Philippine
Islands came to the United States as a complete surprise,
through the sudden naval victory of Admiral Dewey.
This hero produced a situation unprovided for and one
which created responsibilities hitherto unseen. This
has opened a way for trade to the heart of the Orient
and disclosed golden prospects for commerce in the far
East. A general picture of the Philippines, showing
their mineral, agricultural and commercial resources, as
well as an insight into the character and civilization of
the people, will reveal the value of these islands.

The Philippine archipelago comprises about 1200
islands; many of them, however, are uninhabitable rocks.
Twenty have an area ranging from 100 to 250 square
miles, ten vary from 500 to 5000 square miles, and the
two largest, Luzon and Mindanao, of about equal size,
together comprise more than half of the total area of the
whole group, which is 114,000 square miles. The soil
of many of the larger islands is inexhaustibly fertile,
and even under the most primitive system of cultivation
yields large returns to the agriculturist. The chief
products are sugar, hemp, tobacco, rice, coffee, maize,
cocoa, yams, cocoanuts and bananas. In 1896 the sugar
exports amounted to 303,994,899 pounds, notwithstand-
ing the fact that many sugar producing districts still
employ antiquated wooden or stone crushers, run by
buffalo power. The last classification of the sugar mills
showed that there were in operation 5920 cattle mills,
239 steam mills, 35 water mills and only 3 vacuum-pan
sugar factories. Hemp or abaca, when carefully
handled, will pay an annual return of thirty per cent,
on an investment. It is a most valuable fibre plant that

334

A PICTURE OF THE PHILIPPINES 335

grows to perfection in the Philippines, but, with the
exception of North Borneo, seems to thrive nowhere
else. Numerous attempts have been made to grow this
hemp in other parts of the world, but all have failed.
This is their most important export product. The out-
put in 1897 was 825,028 bales of 240 pounds weight. It
is asserted that about one-third of the fibre is wasted by
the present crude methods of extraction. The Filipino
tobacco has in the eastern hemisphere a reputation like
that of the Cuban tobacco in the western. Manila
cigars are sought there about as much as Havana cigars
here. The home consumption is large, but in 1897 tne
islands sent to foreign countries 69,822,327 pounds of
leaf tobacco and 156,916,000 cigars. About 20,000 per-
sons in the neighborhood of Manila find employment in
the tobacco industry. One company employs 10,000
hands, and has a capital of $15,000,000. The total area
of this crop under cultivation is 60,000 acres.

Rice and maize are staple food articles and both
will yield two crops in a year. These products,
however, as well as cocoa, coffee and sweet potatoes are
grown for home consumption only, the primitive
methods of agriculture rendering abundant yields im-
possible. The labor-saving implements of civilized
countries are unknown. A sharpened stick dragged by
a bullock serves for a plough. The cocoanut palms
which thrive on even the poorest soil furnish oil and
lard for the natives. In 1897, 801,437 pounds of the
dried meat of the cocoanut were shipped to Europe to be
used in soap-making.* Fifty varieties of bananas have
been found in the Philippines, and such tropical fruits
as oranges, limes, lemons, tamarinds, citrons and
papaws grow wild and in abundance- The vast forests
of the archipelago contain an almost limitless amount

" The Philippine Islands," by Dean C. Worcester, p. 505.

336 GUNTON'S MAGAZINE [May,

of valuable timber. Nearly sixty species of hard wood
are known, many of which are susceptible of high polish
and are serviceable for ornamental cabinet work. For
carving and veneering purposes certain varieties which
retain in the finished product their delicate green and
yellow tints, natural to the growing wood, are of special
value. Other varieties are used for the building of
ships, wharves and aqueducts since they have peculiar
qualities which resist the action of water. Gums, wax,
cinnamon, dammar and gutta-percha are also forest
products that would make handsome returns to capital,
industry and skill.

The same can be said with reference to the mineral
resources, which are known to be considerable though
altogether undeveloped. Lignite, sulphur and lead
are plentiful; gold and copper have been found in two
of the islands; iron ore of excellent quality yielding up
to 85 per cent, of pure metal exists in the Island of
Luzon, but has not yet been mined.

The commerce of the islands, both internal and
foreign, is at present very small. The exports of the
Philippines in the best seasons amount annually to
$30,000,000 and the imports to $25,000,000. The
imports to the United States from the Philippines in
the year ending June 30, 1897, were valued at $4,383,-
740, and our exports to these islands were estimated at
$94>597- The chief ports for foreign commerce are
Manila, Iloilo, Cebu and Zamboanga. The internal
trade is still small, for the natives are not men of busi-
ness enterprise and generally produce little more than
the necessities of life. The climate is warm and calls
for little clothing. Nature's abundant vegetation sup-
plies them with food, so there is little incentive to
hard work. The industrious landed proprietors and
thrifty merchants are generally mestizos or men of
mixed blood, the descendants of native mothers and

I899-] A PICTURE OF THE PHILIPPINES 337

Spanish fathers. There is little encouragement for these
in the production and marketing of commodities because
of lack of transportation facilities. There is no rapid
and profitable exchange of goods of different communi-
ties as in more civilized countries. During the wet
season, which lasts from about the middle of April to
the last of August, canoes, and sledges drawn by buffa-
loes, bullocks or coolies, must be used to carry goods
through the interior country, and in the dry season the
cut-up roads, baked as hard as brick, are so miserable
that much of the traffic is confined to two- wheeled
vehicles or horses with pack-saddles. Destructive
typhoons and great tidal waves threaten coast-wise
navigation for a considerable part of the year. The in-
adequate means of transportation have probably been
the chief obstruction to the proper commercial deve-
lopment of the colony.

Manila and its suburban villages alone exhibit any-
thing like bustle and activity in trade. Throughout
the business section of New Manila, that part of the
capital city on the north side of the Pasig River, appear
the workhouses, stores, bazaars and merchant residences,
where the thoroughfares are crowded with Spanish,
Americans, Chinese, Malays, and representatives of
various other nationalities, all busy in the purchase, ex-
change and shipping of goods. Craft laden with wares
run up and down the narrow waterways that intersect
this part of the city; diminutive street cars pulled by
single ponies hurry noisily past, and native peddlers
hawking lottery tickets, food, fruit and various fancy
articles push along the highways filling the air with
their cries. Many Chinese, who form an important and
influential element of the population, are in evidence.
They own considerable property. In the majority of
the small towns they have the chief control of the re-
tail trade, and banking business. They are also found

338 GUN TON'S MAGAZINE [May,

in all trades, serving as mechanics, barbers, carpenters,
smiths, furniture-makers, dyers of cloth, and leather
dealers. In this quarter of Manila the small steam-
ships, which ply regularly between the islands, load
and discharge their cargoes. No manufacturing enter-
prises worthy of the name, except the tobacco industry,
are to be found here or in any other part of the Philip-
pines, but the shops are filled with the bamboo hats,
straw mattings, pina fabrics, coarse abaca cloth, dyed
cotton stuffs, grass bags, wood carvings, furniture,
clog shoes and beautiful embroidery, which have been
ingeniously devised by the inhabitants of the suburban
villages. This north side of the Pasig River is
the residence district of the wealthier classes of
the city.

Opposite this New Manila and connected with it by
a stone bridge spanning the Pasig River stands Old Man-
ila, a sleepy Spanish town of the I7th century, which
has been but slightly influenced by modern life and
ideas. The monasteries, government buildings, educa-
tional institutions, convents and churches present archi-
tectural features two hundred years old. The city is
surrounded by a wide moat and a massive wall forty
feet thick. Cannon made two centuries ago are mount-
ed upon the wall, and at each of the several entrance
gates are a portcullis and a drawbridge. The solid
masonry of the residences also shows signs of old age ; and
throughout the entire place, in the paving of the streets,
construction of the houses, nature of the docks, charac-
ter of the fortifications and ornamental features of the
city appear designs and tastes that belong to the distant .
past. It is a well-preserved type of the ancient Spanish
walled city. The modern improvements connected
with Manila are a few electric lights, water-works,
street cars, a railway that extends 120 miles out into
the country, cable communication with Hong Kong,

1 89g.] 4 PICTURE OF THE PHILIPPINES 339

telegraph connections with all the islands, and the pub-
lic drives of the city.

The population of the city of Manila and its sub-
urbs is about 300,000, of whom 200,000 are natives,
50,000 Chinese half -castes, 40, ooo Chinese, 5,oooSpanish
and Spanish Creoles, 4,000 Spanish half-castes, and 300
white foreigners other than Spanish. The villages that lie
along the Pasig River for several miles out from Manila
comprise from 5,000 to 30, ooo inhabitants, of whom the
majority are Filipinos. In Luzon and all the important
islands are many other smaller towns and stockaded vill-
ages whose population is composed almost entirely of
natives.

The population of the whole group of the Philip-
pines has been roughly estimated to be about 8,000,-
ooo. The eighty native tribes forming the bulk of
the population are scattered over hundreds of the
islands. About 1 5 per cent, of these people are semi-
savage tribes who never submitted to Spanish authority.
The warlike Tagals, an important Malay tribe, occupy
fortified villages in the mountains or live near the
water in elevated huts in the lowland districts under
the rule of their own sultans. They have paid no
tribute to Spain and, denying Spanish officials the privi-
lege of living among them, always exercised the liberty
of doing as they please. They are in full possession of
the interior of some of the islands, and spend their
days in indolence and barbaric gambling, dancing and
cock-fighting. An absorbing passion for amusement
and betting is common to all the natives, who are
always ready to quit work and stake their spare coin on
a cock-fight.

In the southern islands are found a few Moros, or
Mohammedans, of pure Malay blood, representing an
invading nation who have conqu ered and in large
part exterminated the Negritos, the aboriginal people

340 GUNTON'S MAGAZINE [May,

of the Philippines. A few of the aborigines still re-
main, however, in the interior country; these are of the
negro type, being small in stature, almost black, and
woolly- headed. They are a nomadic and un warlike
race. The aggressive Malays have constantly made
inroads upon them, have taken their territory, and
multiplied until the invading race at present forms the
bulk of the islands' population. These Philippine
Malays, on the whole, are an improvement on the
average Asiatic people and present many commendable
characteristics notwithstanding their laziness and super-
stition. They are obliging, generous, kind-hearted,
hospitable and fairly good-looking. The want of
peace and good order among them must be attributed
mainly to the oppressive injustice of Spanish rule.

The descendants of the early Spanish settlers, who
have acquired in the course of time a strain of native or
Chinese blood in their veins, termed Spanish mestizos,
constitute an important element of the Philippine popu-
lation. They belong to the merchant and landed classes,
and also hold positions as clerks and subordinates in the
government's employ. The mixed races, which have
resulted from the marriage of the natives with foreign-
ers of many different nationalities, form a large and
influential part of the community. The Chinaman has
produced an extensive progeny. The pure-blooded
Spaniards, if the militia is excepted, did not number
over 20,000, many of whom were only temporary
residents. The non-residents were generally connected
with the government, and lived in the islands for the
sole purpose of making a fortune out of the people, to
be spent later in Spain. Under the mediaeval character
of Spain's government the Cap tain- General, deputy-
governor and head officials, aided by powerful religious
orders, imposed and collected the most exorbitant taxes.
There was a six dollar poll-tax, an income tax, a

1899.] A PICTURE OF THE PHILIPPINES 34*

carriage tax, a tax for cutting down a tree, killing a
hog, running an oil press, keeping a horse^ for all legal
and official documents, for every cocoanut tree; and
moreover there existed a most iniquitous exaction of
15 to 40 days' free labor for the government in raising
products on which Spain had a monopoly. The result
was that Spanish officials soon filled their coffers to
overflowing. If trouble arose in collecting the taxes,
the dwellings of the delinquents were frequently burned
and they themselves were liable to be chased by vicious
dogs. The poor colonists expended all their labor in
futile attempts to meet their government dues, and yet
this government secured them few personal or property
rights, made no internal improvements, furnished no
relief in times of distress, provided no adequate system
of education, nor studied at all to better their condition.
Is it not natural that such abuse and injustice should
cause repeated insurrections and revolts ?

And the Church representatives have worked hand
in hand with the government officials in this wicked
exploitation of the people, discussions arising between
them only as to the division of the spoils. Many
religious orders exist here, and no doubt some have
fulfilled their purpose in laboring to save souls and
elevate humanity, but the majority of these corporations
have been engaged in a very different business. In-
stead of bestowing blessings the Church was ever
seeking charity, and the forced contributions it has
obtained for buildings, real estate and money, through
its sale of indulgences, masses, holy pictures, candles,
purgatory promises, marriage services, burial rites and
what not, have given it the wealth, power and influence
that render its edicts final and absolute with the
islanders. The views of the Archbishop on all im-
portant matters had considerable weight with the
Governor-General. Occasionally on great holidays,

342 GUNTON'S MAGAZINE [May,

when the Spanish soldiers, sailors, and officials were in
procession, this grand ecclesiastic would drive along the
line, stopping at each regiment as he passed, and,
descending from his elegant carriage, clad in royal
insignia of his office, tread upon its colors to demonstrate
the subordination of these forces to the authority he
represented.* In the smaller towns the friars and priests
are all powerful. All education is in the hands of the
clergy, and it has thus far consisted mainly in teaching
the natives a little catechism and a few prayers. In-
struction in writing, arithmetic, and Spanish is the good
fortune of a few of the inhabitants. No translation of
the Bible has been allowed to enter the islands, and no
Protestant institutions can be established. The natives
have been held in a state of dense ignorance and
barbarism, and left to the savage life of grass huts,
superstition, nakedness and want, that elegant churches,
fine residences, splendid style, ease and indolence
might be enjoyed by the religious dignitaries at Manila.
The history of Spanish control in the Philippines,
which continued from Magellan's discovery uninter-
rupted (except for 16 months from October 1762 to
January 1 764, when the English under General Draper
had possession) up to the victory of Admiral Dewey in
May 1898, was one of constant tyranny and cruel
extortion. Civil, judicial, and clerical injustice kept
the islands in constant revolt. In 1622, 1629, 1649,
1660, 1744, 1823, 1827, 1844 and 1872 occurred
formidable insurrections on different islands. In
1896 the Malays and half castes, who had been robbed
so long of their just share of the returns of their indus-
try, arose with a determination to fight to the death for
their rights and liberties. Two years later their fate
was placed by Dewey in the hands of our government.

* " Life in Manila," by Wallace Gumming. The Century Maga-
zine, Aug. 1898.

i899.] A PICTURE OF THE PHILIPPINES 343

To know what permanent disposition to make of the
islands has been for some time the all-absorbing public
question in this country.

The present administration is directing its efforts to-
ward complete annexation of this territory, while the
leading Democrats and many conservative men of
every political party are opposed to such a policy. The
an ti- expansionists declare that such a step will be con-
trary to the constitution of the United States, that it
will launch the American people upon a career of
colonial imperialism, which is contrary to the very spirit
and conception of our republican form of government,
that it will involve this nation in complications and in-
terminable strife with European and Asiatic govern-
ments. They also urge that it will impose an annual
financial burden of many millions of dollars in military,
naval and governmental expenditure necessary to in-
sure peace, order and progress; that it will before long
necessitate conscription for obtaining men to serve in
the army and navy in these unhealthy countries, and
that this is too great a task for the United States to
undertake with so many internal questions pressing for-
ward for solution. Some of our wisest and best men
fear an infusion into our population of a large element
of half civilized races, and dislike the addition to our
territory of these undesirable lands of earthquakes,
torrid sun, and typhoons. It is asserted, too, that it
will force the United States to abandon the principles
of freedom, equality and representation in government
and to accept the inferior political ideas of European
colonial control; that it will injure laboring men by the
disastrous competition of cheap labor in the East, that
it will injure the agriculture of the South and manu-
factured goods of New England by introducing through
the Nicaragua Canal, when constructed, the products of
these eastern islands, and that it will effectually annul

:-

v

the per-
it franchise.
not to have been
a f**«**<e*» in the
m the projectors have
— - . ling for public owner-
to this concern, Mr. Elihu

EDITORIA, CRUCIBLE 347

Root ought to have had mre political sagacity, not to
say statesmanship, than t have committed such a
blunder. It sometimes secns as if the prospect of im-
mediate gain entirely blind people to principle, or even
to their own interest. Tb doctrine that * ' A bird in
the hand is worth two in te bush " belongs to preda-
tory society, not to civilizaon. It is poor policy.

THE RE-ELECTION of Ir. Samuel M. Jones, mayor
of Toledo, as an indepedent candidate against the
nominees of the two regulr parties, is more significant
than the ordinary politicin is willing to admit. It
shows that popular senthent is growing more and
more in the direction of he public policy Mr. Jones
represents, which is undis;uised socialism. His pop-
ularity may be due in par to some attractive personal
qualities, but it is much rore largely due to the social-
istic ideas he stands for. "oledo is not the only city in
which this sentiment is enuring as a force into practical
politics. The votes Altged received in Chicago were
of | the same kind. Massahusetts has one city which
has elected an out-and-out ocialist mayor; Boston has a
two-thirds socialist mayoi Michigan has practically a
socialist governor, and in New York the yellow jour-
nals have become socialis organs, for the obvious rea-
son that their readers lik socialistic talk. Politicians
and wealthy capitalists aremistaken if they think this
movement can be headed off by any arbitrary short-
range use of money metods. Nothing but a broad-
guage, permanent, educatmal campaign, based on ra-
tional and liberal interprettion of industrial conditions,
can stem this tide of socia.sm which if not checked by
educational means will pt the socialists in the saddle
and make economic confisation a basic tenet in public
policy.

•

EDITORIAL CRUCIBLE

SENATOR-ELECT DEPEW has recently been uttering
some very wise words of warning to New York finan-
ciers, regarding their responsibility for reckless methods
in trust organization. Mr. Depew is entirely right in
saying that the public ought to and will hold Wall
Street largely responsible for any industrial disturbances
which may come from mere speculative industrial
organization. It is sincerely to be hoped that Mr.
Depew's frequent pertinent warnings will have a sober-
ing effect among the banking fraternity.

EVIDENCE SEEMS to be gradually forthcoming tend-
ing to show that the present condition of affairs in the
Philippines is in no small degree due to the belief, at
least on the part of Aguinaldo and his followers, that
they have been treated in bad faith by the United
States. Aguinaldo co-operated with Admiral Dewey
in defeating the Spaniards, and with more than an im-
plied understanding that the Filipinos should receive
at our hands the same kind treatment as the Cubans,
and it was not until after we demanded cession of the
islands to the United States that Aguinaldo rebelled.
If this be true, and the evidence strongly points in that
direction, it is additional evidence of character mis-
taken of our policy in our foreign affairs.

THE NEW YORK LEGISLATURE has defeated the per-
petuity feature of any underground transit franchise.
This is a very proper step, but it ought not to have been
made necessary. By inserting such a clause in the
Metropolitan Company's proposition the projectors have
greatly intensified the popular feeling for public owner-
ship. As the legal advisor to this concern, Mr. Elihu

346

EDITORIAL CRUCIBLE 347

Root ought to have had more political sagacity, not to
say statesmanship, than to have committed such a
blunder. It sometimes seems as if the prospect of im-
mediate gain entirely blinds people to principle, or even
to their own interest. The doctrine that * ' A bird in
the hand is worth two in the bush " belongs to preda-
tory society, not to civilization. It is poor policy.

THE RE-ELECTION of Mr. Samuel M. Jones, mayor
of Toledo, as an independent candidate against the
nominees of the two regular parties, is more significant
than the ordinary politician is willing to admit. It
shows that popular sentiment is growing more and
more in the direction of the public policy Mr. Jones
represents, which is undisguised socialism. His pop-
ularity may be due in part to some attractive personal
qualities, but it is much more largely due to the social-
istic ideas he stands for. Toledo is not the only city in
which this sentiment is entering as a force into practical
politics. The votes Altgeld received in Chicago were
of J the same kind. Massachusetts has one city which
has elected an out-and-out socialist mayor; Boston has a
two-thirds socialist mayor; Michigan has practically a
socialist governor, and in New York the yellow jour-
nals have become socialist organs, for the obvious rea-
son that their readers like socialistic talk. Politicians
and wealthy capitalists are mistaken if they think this
movement can be headed off by any arbitrary short-
range use of money methods. Nothing but a broad-
guage, permanent, educational campaign, based on ra-
tional and liberal interpretation of industrial conditions,
can stem this tide of socialism which if not checked by
educational means will put the socialists in the saddle
and make economic confiscation a basic tenet in public
policy.

348 GUNTON'S MAGAZINE [May,

THE RECENT official announcement showing a
marked decrease in British exports has created another
ripple of alarm in England, and has again revived the
talk for preferential trading between England and her
colonies, and greatly strengthened public opinion in
favor of Mr. Chamberlain's Zollverein plan. Of course,
it is very difficult for English opinion to favor a return
to protection under any guise, but, if England's foreign
trade continues to diminish, doctrinaire pride will have
to give way to practical sense, for which the English
are always famous. Those who persist in refusing to
look in this direction are endeavoring to lay the blame
of England's declining export trade to the action of the
trade unions. They complain that the unions are re-
stricting laborers to the minimum output, to the great
detriment of economy in production. There is a modi-
cum of truth in this, but it is altogether inadequate to
explain the falling off in export trade. The English
trade unions are very persistent, but plodding and
narrow. They have never indicated any appreciable
comprehension of the great economic principle that low
cost of production does more to increase the market
and furnish employment than the one-penny method
of restriction of production, limiting apprentices or pre-
scribing the amount to be performed per day by indi-
vidual laborers. That feature has never dominated the
labor unions in the United States to any appreciable
extent. Trade unions must learn to act consistently,
with broad economic principle, and keep in line with
the economic advance of society, or they will lose their
usefulness. When they simply become organizations
for restricting the output and opposing the introduction
of machinery, and otherwise consciously limiting the
productive process, they fail to contribute permanently
to the welfare of the class they represent.

1899-] EDITORIAL CRUCIBLE 349

THE BOSTON HERALD has just waked up to the fact
that with the eleven cent a pound duty on wool, the
price has only increased two and three-fourths cents.
With its habit of insisting that the full amount of the
duty is always added to the price, the Herald cannot
understand this, though to economic students of the
subject it is perfectly clear. The present case is sub-
stantially the same as that which, as Professor Taussig
showed, occurred under the McKinley law, when a ten
cent duty only gave an average rise of less than three
cents above the London price. There are cases under
which the tariff is all added to the price, as in the case of
raw sugar; there are conditions under which none of the
duty is added to the price, as in the case of coal; and
there are instances when part of the tariff is added to
the price, as in the case of wool. The reason for this
is the natural operation of an economic principle, which
causes the price in the general competitive market to
be determined by the cost of the dearest portion of the
supply, a principle with which the Boston Heralds
economist has always appeared to be unfamiliar. The
tariff is all added to the price only when the dearest
part of the supply comes from abroad. Whenever the
levying of a duty changes the foreign product from
being the cheapest portion of the supply to the dearest,
only that portion of the tariff is added to the price
which rises above the cost of the domestic product. If,
for instance, the cost of producing a foreign product is
five cents below that of the domestic product, and the
duty is eight cents, only three cents would be added to
the price. The other five cents is absorbed in raising
the foreign product to an equality with the domestic.
It is only the three cents which raises it above the do-
mestic that is added to the price. That is why the duty
on wool never was all added to the price — though the
Herald will probably never understand it.

Civics AND EDUCATION

WHAT SHALL THE CITY DO?

Mr. Maltbie's review of ''Municipal Functions"*
asks this question but does not attempt to answer it.
He prepares trie reader for the somewhat negative char-
acter of his work by the prefatory remark : ' ' The
present study is confined to stating what the municipal-
ity does, leaving to others the task of drawing conclu-
sions as to what it ought to do."

But it must not be supposed, on that account, that
the monograph is not a really important piece of work.
It is. In it are embodied the results of an exhaustive
investigation of municipal conditions, domestic and
foreign. "Surprisingly full" returns to the commit-
tee's inquiries were received from no less than 500
cities, — 150 in the United States and 350 abroad.

Space does not permit adequate review of Mr.
Maltbie's interesting treatment of the rise of urban cen-
ters, from the primitive self-protective community, up
through the communes, boroughs, chartered towns and
free cities of the middle ages, to the great manufactur-
ing and commercial cities of to-day. He recognizes
the fact that : * ' The urban center is primarily an eco-
nomic phenomenon," and incidentally shows that diver-
sified tastes and demands on the part of the people are
the great social forces that call into existence those
forms of productive industry around which cities natur-
ally grow up. He does not note the parallel fact, how-
ever, that these influences are interacting, in that city

* Municipal Functions: A Study of the Development, Scope and
Tendency of Municipal Socialism. By Milo Roy Maltbie, Ph. D. 235
pp. Published by the Reform Club's Committee on Municipal Admin-
istration, 52 William Street, New York.

350

WHAT SHALL THE CITY DO? 351

life itself is one of the greatest stimulators of new de-
sires and expanding social experience.

In discussing the numerous functions of the modern
city, Mr. Maltbie notes the fact that German cities take
the lead in providing poor-relief expedients of the class
of municipal lodging houses, labor bureaus, non-em-
ployment insurance, land allotments and potato farms.
Such devices seem to develop almost spontaneously in
the paternalistic, bureaucratic atmosphere of German in-
stitutions,— which, by the way, does not necessarily
imply a serious criticism on these efforts, in Germany.
Much depends on tradition, habit, and national temper-
ament. Employment bureaus and labor insurance, care-
fully administered, are doubtless capable of good re-
sults almost anywhere. It may be that free lodging
houses and potato patch schemes can be carried on by
German cities on an extensive scale without materially
weakening the spirit of independence and self-help or
lowering the standard of living and making semi-pau-
perism easy, but at best it is dangerous experimenta-
tion. It is no criticism on American cities that
they have attempted very little in this direction.
With our conditions and type of population such
palliatives, freely provided, would in all proba-
bility simply weaken or retard the very social forces
which are heading toward more satisfactory economic
conditions in which charity, open or disguised, shall be
an ever-diminishing factor. In proportion as semi-
charitable sources of relief are made easily available it
becomes more and more difficult to bring laborers with-
in the range of economic trade union organization,
wherein, not only are they able to maintain their in-
dustrial status more effectively, but assistance during
enforced idleness comes not as charity but as a drain on
their own organization, and it is therefore to the inter-
est of both the laborer and his union to terminate this

35* GUNTON'S MAGAZINE [May,

drain as soon as possible by securing new employment
for the idle member.

The city is a wonderful opportunity-creator in the
matter of education. Where the school population is
counted by the thousand instead of by the dozen, accom-
modations and facilities must be furnished on a large
scale; and, by a well-known economic law, this makes
it possible to conduct the work with the best appliances
and by the most approved methods, while paying the
highest salaries, at hardly greater proportionate expense
than is necessary to furnish even the meagre facilities
and low-paid service in rural schools. The larger
opportunity of urban communities also increases the
responsibility and obligation to provide the best in
education, and the possibilities in this direction are not
limited to the supplying of public schools. A striking
instance of the expanding conception of municipal duties,
in education, is seen in the rapid growth of free public
libraries. This movement is very modern, — hardly half
a century old. In this country, according to Mr. Maltbie,
it began in Boston in 1847, at the investigation of May-
or Josiah Quincy, Jr., when "the Boston Public Library,
the first institution of the kind, was set under way."
Fifty years later (1896) there were 627 free public
libraries of not less than 3000 volumes each in the United
States. Almost one-third of these are in Massachusetts
—to her high honor be it said — while the parent insti-
tution in Boston now occupies a magnificent building
which cost $2,650,000, besides ten branch libraries and
seventeen delivery stations. It possesses 700,000 vol-
umes and loans a million and a quarter of books a year.
Of the 125 cities with 25,000 population or over, 83
have municipal libraries; and of those over 100,000 all
have such libraries except Louisville and New York.
The latter contributes $225,000 a year to private free
libraries and is about to furnish a $2,500,000 building

I899-] WHAT SHALL THE CITY DO? 353

for the Astor-Lenox-Tilden library, which thus becomes
as free and as public an institution as if owned outright
by the city.

Great Britain has about 350 such libraries, with
over 5,000,000 volumes, issuing 2 7, 000,000 books a year.
All but six of the sixty-five towns of over 50,000 popu-
lation now maintain a free public library; while in 1850
there were none. The first was established in Manches-
ter, in 1852. Public libraries are numerous in France
and Germany, but are much less important to the pub-
lic than the English and American, being intended
chiefly for scholastic research. On the other hand,
museums of art and science in the cities of continental
Europe are more numerous and more richly stocked
than anywhere else, — which is not surprising in that
environment.

Continental Europe also takes the lead in provid-
ing municipal theatres and opera houses ; but it is rather
difficult to see why, in more advanced countries at least,
such enterprises should be added to the list of munici-
pal functions. Open air public concerts, so common in
American cities, might of course be objected to in the
same way; still, the concerts have a universal public
character and make no pretence of competing with
other musical entertainments, while the municipal the-
atres of Europe are avowedly designed to furnish
this form of amusement at cheaper rates than would
be offered by private establishments; — but this,
however, not on any basis of fair economic com-
petition. The cheap rates of the municipal and
subsidized theatres of European cities are possi-
ble only because a large part of the expense is made
up by public taxation. It would be better that
these public amusements be furnished, if at all, en-
tirely free to everybody, than on any misleading half-
and-half plan which simply begets among the people

354 GUNTON'S MAGAZINE [May,

the idea that they are paying the legitimate value of
the thing, and that the cheapness is due to the economic
advantage of public management, — an absurdly false
notion on the face of it. But the whole proposition
that the running of theatres is a proper municipal func-
tion has an excessively faddish sound, in American
ears at least.

Of a very different character are public parks.
These are not merely important factors in the promo-
tion of public health and happiness but actually exercise
a refining, educative social influence. To furnish
these agencies of civilization is in every sense a proper
municipal function, — indeed, it is of the very essence of
wise public policy. The United States is in advance of
all other countries in this respect. The really serious
need of parks begins perhaps when cities pass about
the hundred thousand mark, and all of our cities above
that point, except two, now have several hundred acres
each, devoted to park purposes. Practically all English
towns have parks, but they are considerably smaller
than ours; and the same is true of German cities. Paris,
in the matter of parks as of nearly everything, is
France. Within and about the city limits are 200,000
acres of public parks; but the other French cities are
meagerly supplied. No city in the world anywhere
near approaches Paris in park facilities.

The German cities have done most, however, in
providing small parks and playgrounds in the congested
sections. England comes next, but the movement is'
very recent in the United States. Washington, St.
Paul, Minneapolis and Boston are perhaps best provided;
New York is beginning to make real headway, and is
adding the feature of recreation piers. Just at present
the chief emphasis in public park construction ought to
be laid on the multiplying of these small breathing
spots. They serve at least two excellent secondary

i899- ] WHAT SHALL THE CITY DO? 355

purposes, — reduce the number of old rookery tenements
and diminish the density of population.

Mr. Maltbie's chapter on the industrial functions of
cities is of greater contemporary interest than any other
part of his monograph. The oldest of these functions,
probably, is the ownership and renting of real estate;
but this has steadily dwindled towards insignificance,
unless the municipal lodging-house experiments in
certain English and Scotch towns are to be considered
a reverse current. , The prime object of the lodging-
house schemes, however, is not to secure large reven-
ues, as in the case of early municipal landlordism, but
rather to supply wholesome and cheap lodgings for the
poor; — an enterprise that is now being taken up in
American cities by private capital, thus rendering mu-
nicipal action superfluous. Nearly all European cities
own public markets, abattoirs, cemeteries and water
works. Private water works are more numerous in
England than elsewhere in Europe. About one-half
the water works of American cities are under munici-
pal management. Of the water works of continental
cities Mr. Maltbie says that * * in none does the quantity
furnished approach that in English and American cities.
In many cases the supply is extremely scanty and un-
satisfactory. " Of this he gives several illustrations.

Municipal ownership of gas plants is very common
in Germany, and occurs in about half the large towns
of Great Britain, In the United States and France,
private enterprise in this field is the almost universal
rule. Operation of gas works is a long step away from
the perfunctory, mechanical, slow-going sort of enter-
prises that are already found to tax the efficiency capa-
city of municipal governments almost to the limit,,
especially where unlimited democracy prevails. The
most important experiment of the sort in this country
— that of Philadelphia — was recently abandoned. Eng-

356 GUNTON'S MAGAZINE [May,

lish experience has been more successful; indeed, a
great many English and Scotch towns and cities have
gone so far as to undertake municipal ownership, and
in some cases operation, of street railway lines. About
one-third of the systems of Great Britain and Ireland
are now owned by the municipalities. Such experi-
ments ought to show their maximum possibilities of
success there if anywhere, because of the exceptionally
high character of municipal administration. English
city government, while democratic in form, has become
by virtue of tradition and habit a sort of respectable
aristocracy of well-to-do business men, serving for
honor, and conducting matters in a very independent
sort of way and with a freedom from popular criticism
and opposition wholly impossible under American
political conditions.

Strange to say, even Germany has done practically
nothing in the matter of municipal ownership of street
railways. Here in the United States the movement is
unquestionably gathering headway. Boston constructed
its own subway, but a private company operates the
road. Mr. Maltbie appears to lean very strongly to-
wards the municipal ownership idea, urging that street
railways are natural monopolies and that ' « Competition
has failed. Public opinion has no effect." Neither
assertion is correct. The possibility either of direct
competition or of withdrawal and transfer of franchises
always exists, and this fact has recently produced an
astonishing amount of activity on the part of the street
and elevated railway companies even here in New York,
where conditions are so naturally monopolistic. In
consequence, we are about to have revolutionary im-
provements on the entire street transit systems of the
metropolis. Moreover, public opinion has signally tri-
umphed in the recent bitter contest over the matter of
four tracks on Amsterdam Avenue; two of the tracks
now there will have to be taken out entirely.

1899.] WHAT SHALL THE CITY DO? 357

If public interest is not strong enough even to ob-
tain improvements from private companies, and insist
upon the desired quality of service, certainly it is inad-
equate to conduct the entire enterprise itself, efficiently
and honestly, carry the responsibilities, and pay the
bills for all improvements.

There can be no objection to municipal ownership
of so permanent and unchangeable an affair as an un-
derground tunnel, any more than of docks, parks and
public buildings. Construction and operation of a rail-
road is a very different proposition. The municipality
is in the most favorable position for getting cheap and
efficient service when it offers its franchises to the
highest bidders, specifies unmistakably the service to
be rendered, and then holds over the corporations the
constant threat of penalties for shortcomings. There-
by it exercises all the compelling and spurring
power in the situation, but carries none of the re-
sponsibility, risk, or expense of changes. As has been
pointed out many times in these columns, under muni-
cipal ownership all the complaints, threats and demands
of the community must be directed against itself, and
the improvements come at its own expense. This is to
say nothing of the immense burden of indebtedness
necessary in order to obtain the ownership of street
railway systems, unless, as has been done in Great
Britain, we should compel the owners to accept only the
original cost of the plant, less depreciation. By this
process people who have purchased the stock of these
companies are mulcted outright of whatever portion of
the price of that stock was represented by the good will
of the franchise. Confiscation is a cheap way of trans-
ferring property from private to public ownership, but
once establish that as a principle of legislative action
and the final consequences to freedom and progress will
be more costly than]civilization itself can sustain.

CIVIC AND EDUCATIONAL NOTES

Recently we recorded our protest against the re-
actionary movement in North Carolina, intended, in
A Disgrace effect, to deprive the negro race of edu-
to the cation. This scheme is, briefly, to apply

only the school funds collected from tax-
ation of negroes to the education of negro children, and
to use all moneys collected for educational purposes
from white people for the education of white children.
In line with this, it is interesting to notice that a pro-
posed constitutional amendment has been passed by the
North Carolina legislature, providing practically for
disfranchisement of the negro race by a one-sided edu-
cational test, like that in the new Louisiana constitu-
tion. This would dovetail in very nicely with the other
plan, as a method of keeping the colored race out of
active citizenship and preventing them from ever reach-
ing the point of fitness therefor.

We are not disposed to be unduly harsh on the
educational test in itself; it is difficult for northern peo-
ple to realize what negro domination would mean in
the South. If the educational test is to be a substitute
for systematic political intimidation and murder, it is a
•distinct step in advance. If there should be coupled
with this an enlarged and extended system of educa-
tion, including industrial training, we should, say that
the South was dealing with the matter in probably the
wisest way possible under the circumstances; but, on
the contrary, they propose to withdraw what little edu-
cational opportunity has heretofore been provided.
Furthermore, both in North Carolina and Louisiana,
they have very ingeniously contrived to exempt the
white people from the educational test. That is, the
Louisiana plan establishes an alternative educational or
property qualification for all negroes, but only for those

358

CIVIL AND EDUCATIONAL NOTES 359

white people who did not possess the franchise at the
time the new constitution went into effect; while in
North Carolina it is proposed to exempt from the edu-
cational test all persons who could have voted prior to
January ist, 1867, when the franchise was extended to
the colored race; or whose ancestors could have voted
before that time. Of course this is purely arbitrary,
one-sided, color-line legislation, and if the additional
.scheme for withdrawing negro education succeeds in
North Carolina, to say nothing of being copied by other
southern states, it will be a disgrace to southern senti-
ment and to the public opinion of the whole nation that
allows any state to enact such a scheme without being
made to realize the lasting shame it will thereby incur.

At last it seems that action in the matter of provid-
ing suitable quarters for the New York Public Library,
New York so ^orig delayed, is about to be taken.
Public The contract for removal of the old reser-

Library vojr at Forty-second street and Fifth

avenue has been approved, and $500,000 appropriated
by the city to do the work. On this site a building
costing upwards of $2,000,000 is to be erected, and it is
expected that about half this sum will be available dur-
ing the present year. It really seems probable, there-
fore, that work on this most important project will be
•commenced at an early date.

During the last four years of waiting, however, the
New York Public Library has not been in a stagnant
condition. Since the consolidation of the Astor and
Lenox Libraries and the Tilden Fund, the library has
been increasing at a more rapid rate than any other in
the world. Since July ist, 1896, the consolidated libra-
ry has been augmented by about 80,000 volumes and
80,000 pamphlets, and it is estimated that at the end of
the present fiscal year the total equipment will be

36o GUNTON'S MAGAZINE

465,000 volumes and 180,000 pamphlets. The annual
additions of volumes and pamphlets have been at the-
rate of 51,000 (of each about one-half) as against an in-
crease of 30,000 per year of the Boston Public Library,
and 28,000 of the British Museum. The new contribu-
tions to the New York Library have been largely in the
line of reference works and additions to the historical
collections, so that the standard has been preserved as
well as the quantity of matter increased. The department
of sociology and economics has grown with especial ra-
pidity. The use of the Tilden fund has made it possible
to extend new conveniences to the public, at the Astor
and Lenox Libraries; so that, since 1894, the number of
readers has increased from 66,500 to 106,000, and the
number of books called for from 243,700 to 367,800.
According to Chairman Cadwalader, of the Executive
Committee, the management of the consolidated libra-
ries during this period has been conducted with "singu-
lar unanimity of opinion," and the experience in con-
ducting the libraries jointly, even with the present
disconnected and inadequate facilities, amply justifies,
the consolidation, even though it were not to be fol-
lowed by the erection of a library building which prob-
ably will have fewjif any superiors of its kind anywhere^

SCIENCE AND INDUSTRY

THE PANAMA CANAL TO-DAY

Within the last few months there has been a marked
revival of interest in the Panama Canal project. The
impression has prevailed for several years that the phy-
sical difficulties of the route and the financial and legal
entanglements were such as practically to remove the
whole Panama enterprise from further serious conside-
ration. Consequently, in the United States at least,
attention has been centered almost exclusively on the
Nicaragua route.

In December last, the government commission ap-
pointed in June, 1897, to investigate this route, made
a preliminary report to the Secretary of State declaring
its belief ' ' That the construction of a canal across
Nicaragua is entirely feasible." The commission sur-
veyed the Maritime Canal Company's route and the
Lull Route, estimated to cost respectively $124,000,000
and $125,000,000. In the light of this report, bills were
introduced in congress providing for the construction
of a canal across Nicaragua, the work to be guaranteed
and controlled by the United States government, and
some measure of this sort seemed for a time to be in a
fair way of becoming law.

Meanwhile, whether because of the rapid progress
of the Nicaragua scheme or not, the friends of the Pan-
ama Canal suddenly became active, and public attention
has been called in various ways to its present satisfac-
tory condition. The advantages it is claimed to possess
over the Nicaragua route are being urged with great
earnestness. This revival of activity in behalf of the
older enterprise has not been without result. Congress
failed to pass any of the measures providing for con-
struction of the Nicaragua Canal, and instead author-

361

362 GUNTON'S MAGAZINE [May,

ized the president to appoint still another commission,
' ' to make full and complete investigation of the Isthmus
of Panama with a view to the construction of a canal
by the United States across the same." This commis-
sion was authorized ' ' particularly to investigate the two
routes known respectively as the Nicaragua route and
the Panama route, with a view to determining the most
practical and feasible route for such canal, together with
the approximate and probable cost of constructing the
canal at each of two or more of the said routes." In-
formation is also to be obtained as to the present owner-
ship and financial status of existing canal enterprises,
both at Panama and Nicaragua, and the cost of pur-
chasing all rights therein. The president is authorized
to spend $1,000,000 on this investigation, and is to sub-
mit the results to congress.

This shows that the Panama route is once more a
serious factor in the situation. Naturally, it is difficult
to get a fair statement of the comparative merits of the
two routes from the advocates of either one of them.
The promoters of each project, whether intentionally or
unconsciously, emphasize the strong points of the one
and exaggerate the weak features of the other, so that
at present the judgment of the public is likely to be in-
fluenced quite as much by the argumentative ability of
the advocate as by the actual situation in either case.

Work on the ill-fated de Lesseps project of a sea-
level canal at Panama was begun in 1881. The original
company was capitalized at $240,000,000, and the work
was to be completed in twelve years. The preliminary
engineering work and investigations of climatic and
other conditions were totally inadequate; and the work
had not been long under way before two or three im-
mense and unexpected difficulties were encountered.
The plan involved a mountain cut eight miles in length
and from 100 to 325 feet in depth, and when work was

i8Q9.] THE PANAMA CANAL TO-DA Y 363

commenced on this it was found that the soil was of
such a character that the side slopes caved into the ex-
cavation about as fast as material could be taken out.
The canal was also to follow for a distance of 25 miles
the course of a river subject to immense floods,
against which no provision had been made. Again,
climatic conditions had not been reckoned with, and the
laborers sent there to do the work were carried away
wholesale by fevers, especially while the fifteen mile
strip through iriarshy lowlands, from the Atlantic
Ocean to the mountain section, was being excavated.

After a few years the sea-level idea was abandoned
and a system of locks embodied in the plan. The
whole affair, however, had become so doubtful, costly
and complicated that in 1889, after having spent more
than $156,000,000, the company failed and its affairs
went into the hands of a receiver. Work was suspended,
and about all the public interest that remained in the
enterprise was centered for the next few years on the
scandals growing out of its questionable financial opera-
tions.

In the fall of 1 894 a new company was organized to
revive the enterprise. It was estimated that the work
already done on the canal, together with the machinery
and material on hand, were worth fully $90,000,000,
and the new company started out with this equipment
and a cash capital of $13,000,000, subscribed by some
of the strongest financial houses in France. The new
company is said to be entirely free from any financial
complications with the old de Lesseps organization; but,
after the completion of the canal, the bondholders of
the latter company are to receive 60 per cent, of the
profits of operation.

The route of the canal lies wholly within the United
States of Colombia; and the concessions which had been
granted by that country to the old canal company were

364 GUNTON'S MAGAZINE [May.

renewed to the new, and the time extended until 1910.

This new company began by ascertaining the exact
condition of affairs along the whole route. It conducted
thorough and expensive tests as to the character and
quantity of material to be excavated, and the extent
and duration of the periodic floods in the Chagres river.
Over $4,000,000 was spent merely on surveys of the
portion of the route yet to be completed, — which indi-
cates the seriousness with which this effort to complete
the Panama Canal was undertaken. As an additional
step in making certain of the exact situation and re-es-
tablishing public confidence in the enterprise, the com-
pany obtained the appointment of an international tech-
nical commission to make an exhaustive examination of
the route. This commission was organized in 1896, and
contained representative engineers from the United
States, England, France, Germany and Russia. Gene-
ral Henry L. Abbot, of the United States Corps of En-
gineers, was the American member of the commission,
and he has published some of the results of his inves-
tigations, announcing the conviction that the Panama
route is now entirely feasible and superior in fact to any
that can be found in Nicaragua. It is asserted that the
canal can be completed in less than ten years, at a cost
of not to exceed $100,000,000, although this sum does
not seem to include the interest charges which will
accrue during that period.

As everyone who has looked at the map of that
region knows, the narrow strip of land between North
and South America is shaped like an " S, " so that for
a considerable distance the Atlantic Ocean lies to the
North and West of the Isthmus and the Pacific to the
South and East. Consequently, the line of the canal,
starting at Panama on the Pacific, instead of run-
ning to the East, takes a north-westerly direction to Colon
on the Atlantic. At a point about one-third of the

THE PANAMA CANAL TO-DA Y 365

distance from Panama to Colon the canal enters the bed
of the Chagres River. This river comes down the
Isthmus from the East until it reaches this point of
junction with the canal, where it turns sharply to the
Northwest and reaches the Atlantic several miles west
of Colon. The Chagres is an uncertain stream and will
be difficult to regulate, but it furnishes the key to the
problem of water supply for the summit level of the
canal. In this respect it occupies to the Panama Canal
the position that Lake Nicaragua does to the Nicaragua
route, with the exception that the Chagres is naturally
a much less stable source of supply. It is proposed to
control the Chagres floods by means of two great dams.
The first of these will be thrown across the channel of
the Chagres about 9}^ miles above the point where it
reaches the line of the canal. This dam, at Alhajuela,
will be constructed of concrete masonry and rest upon
solid rock. It will be about 937 feet long and rise 1 34
feet above the river bed — 164 feet above the low-
est foundation of the dam itself. This will create an
artificial lake, which will serve a number of important
purposes. It will dissipate the force of the torrential
floods in February, March and April; supply electric
power for operating the locks and lighting the entire
canal; and also furnish, by means of a feeder conduit
ten miles long, a water supply, constant during the
dry season, to the summit level of the main canal.
Careful and long continued observations of the maxi-
mum variations in the volume of water discharged by
the Chagres show that the reservoir at Alhajuela must
be capable of impounding at least 35,000,000 cubic feet
of water in order to hold back the most violent floods;
the proposed dam will more than accomplish that.

This, however, provides for only half the trouble to
be expected from the floods of the Chagres. The canal
and the river come together at Obispo, and from that

366 GUN TON'S MAGAZINE [May,

point the two run close together, intersecting at numer-
ous points, for a distance of about 13% miles, to Bohio,
where by a series of locks the canal drops to the lowlands
at sea level. To prevent washouts along this 13^3 mile
strip, and to protect the locks, another great dam is to
be erected at Bohio. This dam will rest upon a bed of
clay and will be constructed of earth, with a very broad
foundation, and both slopes faced with stone. The up-
stream slope will be very gradual, only one-foot rise to
three-foot base. The down-stream slope will be reinforced
by a great mass of loose stone, rising with a very grad-
ual slope almost as high as the water level on the up-
side. The dam will be 1,286 feet in length, with a
height of 75 J^ feet above the river bed and 93^ feet
above the clay foundation. It will be nearly 50 feet
wide at the crest, which will rise ten feet above the
high-water level of the artificial lake thus to be created.

It has been found that to regulate the floods along
this part of the river an artificial lake capable of retain-
ing nearly 53,000,000 cubic feet of water will be neces-
sary; in reality a hundred times more than this will be
secured by the Bohio dam.

Both these dams will have overflow weirs of the
sort in use along the Manchester canal, in England.
To provide for excessive floods at Bohio two distinct
outlets have been provided, one discharging the over-
flow through the bed of the river below, and the other
at the sources of the Rio Gigante.

The total length of the Panama Canal when com-
pleted will be 46^ miles, of which about three miles
lie in the Bay of Panama, leaving 43^ miles inland.
The depth is to be 29^ feet throughout. From Colon
to Bohio, as we have said, the canal runs through low
country and its surface is at sea level. This is a dis-
tance of nearly 1 5 miles, and on the Pacific side there is
a short stretch of about 4% miles also at sea level. Of

i899-] THE PANAMA CANAL TO-DAY 367

this total 19 miles of sea-level canal, about 15^ miles
have already been excavated, and for that matter a
very considerable amount of work in the mountain cuts
has also been completed. Surveys have been made for
three different summit levels, and of these the one
which seems most feasible and likely to be adopted pro-
vides that the bottom of the canal at its highest portion
shall be 68 feet above mean sea level.

Following along the canal from Colon on the At-
lantic side, the first rise is at Bohio; here two locks
carry the canal to the level of the artificial lake in the
bed of the Chagres River. This lake at its lowest
level will be 52^ feet above the sea, and at its full
height 65^ feet. The lake, of course, will practically
do away with the need of excavation for the next 1 3 %
miles to Obispo. At least, the amount of dredging will
be comparatively small. At Obispo the canal leaves
the valley of the Chagres and rises by means of two
double locks to the summit level — a stretch nearly six
miles in length and, as before stated, 68 feet above
mean tide level. The southern end of this summit
level is at Paraiso, where another double lock lets the
canal down to 43 j£ feet above sea level. At Pedro-
Miguel, i y2 miles further on, there are two more double
locks; and for the next mile and a half the bottom of the
canal is twelve feet below mean tide level ; the surface
of course being 17^ feet above. At Miraflores comes
the last lock, which brings the surface of the canal
down to sea level, 4 j£ miles from the Pacific. To allow
for the tides, however, the bottom of the canal here is 40
feet below mean sea level, — 10^ feet deeper than else-
where.

All the locks are to be double, built of masonry,
upon foundations of rock. They will be 738 feet long,
with a center depth of about 33 feet. The larger chamber
will be 82 feet wide and the smaller 59 feet. The maxi-

368 GUNTON'S MAGAZINE [May,

mum lift for any of these locks has been fixed at
feet; except at Bohio, where during the extreme floods
of the Chagres the locks can be operated with a lift of
32^ feet.

The bottom width of the canal in the section from
Colon to Bohio, on the Atlantic side, and from Paraiso
to the Pacific, will be 98 feet in earth cuts and 1 1 1 feet
in rock; through the artificial lake in the Chagres
River valley, from 167 to 174 feet; on the summit
level, 118 feet; and along the three-mile section in
Panama Bay, 167 feet. At intervals of about five miles
all along the canal there will be enlarged sections,
having a width of about 197 feet at the bottom, to
permit vessels to pass. The canal crosses the con-
tinental divide at Culebra, the highest point in the
ridge being nearly 340 feet above sea level. This and
the Emperador ridge, a little way to the North, are the
points where the greatest amount of excavation has
been and will be necessary. The work has already
been completed, however, below the point where the
danger of earth slides exists, and the slopes will be
faced with stone. The remainder of the excavation
through this section will be in comparatively solid
material, and about 15,600,000 cubic yards of rock
is yet to be taken out.

The points of superiority that are claimed for the
Panama over the Nicaragua route are numerous. Gen-
eral Abbot, for instance, in comparing the two routes
in the columns of the Engineering News, calls attention
to the fact that the harbors at both extremities of the
Panama Canal are good, while that at Grey town at the
eastern end of the Nicaragua route can be kept free
from sand only by extensive and costly jetties. Also,
about 40 per cent, of the Panama Canal has been actu-
ally excavated and considerable work done on the
remaining portions. The excavations yet to be made

1899.] THE PANAMA CANAL TO-DAY 369

on the Panama line will be chiefly in rock, so that the
danger of sickness due to opening up fever soaked
lowlands no longer exists.

Then, too, the construction plant is already on the
line and thoroughly installed, and accommodations for
keeping laborers and continuing the work are fully
provided. A railroad has been built and is in opera-
tion along the entire Panama route, while more than
100 miles of railroad must be built along the Nicaragua
line preliminary to beginning work on the canal. The
Panama Canal is less than one-third the length of the
Nicaragua ; and in the construction of the latter one
great dam is required of a type almost without preced-
ent and of unknown staying qualities, yet upon which
the summit level of the entire canal absolutely depends.

For the most part the Panama Canal is to be some-
what deeper and wider than anything called for in the
plans of the Nicaragua route. It is also urged that the
control of a summit level supply by so great a body of
water as Lake Nicaragua will be very difficult and un-
certain, but the argument is somewhat strained in
view of the even greater fluctuations and violence of
floods in the case of the Chagres River. The only
point of difference here seems to be the possibility of
controlling the overflow by adequate dams; and,
while the much criticised Ochoa Dam on the Nicaragua
route may be inferior from an engineering standpoint
to either of those possible on the Panama line, it is not
settled yet by any means that the Ochoa proposition is
the only feasible one for securing a safe summit level
for the Nicaragua Canal.

Such is the present status of the Panama Canal.
On the whole, congress probably did a wise thing in
suspending further action with reference to the
Nicaragua Canal until full and exact comparative in-
formation could be had of both routes. Too much

370 GUNTON'S MAGAZINE

credence should not be given to the claims of the
Panama Company until very careful investigation has
been made, particularly since the enterprise has so
discouraging a record of failures and financial complica-
tions that a large element of doubt and suspicion
inevitably attaches to it even yet. It is impossible to
tell at present to just what extent the present company
is entangled with the old, or what obligations would be
assumed if we should undertake to buy out the Panama
Canal as it stands. It may not be true, but it is barely
possible nevertheless, that the revived agitation in favor
of the Panama route is due to a desire on the part of the
present company to sell out to the United States
government at a good safe sum and be rid of further
responsibility in the matter. If this is so, all the more
important does it become to investigate the exact situa-
tion ourselves, as we are about to do, rather than to
accept any second-hand information. If, as is estimated,
it will cost about $100,000,000 to finish the Panama
Canal, and the equipment already on the ground is
worth $90,000,000 or $100,000,000, it is evident that a
considerably larger sum would have to be paid for
possession and completion of the enterprise than the
estimated cost of constructing the Nicaragua Canal.

The United States should be in absolute control,
politically at least, of one of these canals. If it shall
appear that the Panama route is the better and more
feasible, and can be obtained at a reasonable price and
without foreign complications and an inheritance of
financial entanglements and litigation, perhaps it will
be better after all to drop the Nicaragua proposition
and take up the older and already half-completed canal.
If these conditions cannot be met, however, we ought
to delay no longer in going vigorously to work on the
Nicaragua route, as a national enterprise, whether the
Panama Canal is completed and becomes a competitor
for inter-oceanic traffic or not.

SCIENCE AND INDUSTRY NOTES

According to statistics collected by the govern-
ment of Sweden, there are in use in the various coun-
tries of the world 1,288,163 telephone
instruments, and the number of miles,
covered by telephone service is 1,509,499,
Some of the more interesting figures are:

The World's
Telephones

Instruments

Miles

Instruments

Miles

Great Britain &

Sweden (1897)

56,500

74,568

Ireland (1894)

69,645

83,401

Austria-Hun-

Germany (1896)

151,101

147,093

gary (1896)

31,909

64,315

Switzerland

(1897)

28,846

47,594

France (1894)

27,736

63,230

Italy (1896)

11,991

13,049

Spain

11,038

14,282

Russia

18,495

40,391

Japan (1897)

3,232

5,262

Philippines

452

592

United States

Cuba

1,8x8

1,181

(1896)

772,627

805,711

Australia

823

2,390

Canada (1898)

3-3,500

44,020

This would be one instrument to every 98 people,
approximately, in the United States; one to every 543
in Great Britain and Ireland; one to every 7,000 in
Russia; one to every 1,599 in Spain; one to every 12,700
in Japan. If it be true that the quantity and variety
of things used by a people is some indication of the
state of its civilization, these figures, as one of the
minor ' 'straws," will interest students of sociology.

The serious dangers to come from wholesale de-
struction of forests are at last being appreciated. Prac-
tical steps are being taken in many quar-
ters to head off the danger and provide
for scientific systems of forestry preser-
vation. At present Minnesota seems to be taking the
lead in this respect. A fire warden system has been:

Forest
Preservation

372 GUNTON'S MAGAZINE

established as a means of protection against forest fires,
and an extensive plan of re-forestation is now under
way. This plan, briefly, is as follows: large tracts of
land from which the timber has been cut away, instead
of being turned into agricultural land are to be re-
forested in sections, that is, a certain tract re-planted
with trees every year for a long period of time, so that
when the last piece is covered the first will be ready for
cutting and re-planting on the second round. Scientific
re-forestation was undertaken in certain districts of
Saxony in the first quarter of the present century, with
the result that the state forests of Saxony have increased
in value more than five-fold during the seventy-five
years, besides yielding a large annual revenue. Im-
mense tracts of land ready for re-forestation can be
purchased in Minnesota at twenty-five cents an acre,
and it is estimated that if the state should undertake
the work of reclaiming in this manner, say, two million
acres at the rate of 25,000 acres per annum, the total
annual expense would be not more than $350,000. The
whole two- million acres would be covered on this plan in
about eighty years, and the first section of 25,000 acres
could then be cut and re-planted. A system like this,
if generally established, would not merely provide a
constant timber supply but would do it without any of
the dangerous economic consequences that are certain
to follow the wholesale, unrestricted destruction of
forests with no provision for the future.

CURRENT LITERATURE

JOHN BRIGHT*

This is not exactly a biography of John^Bright, but
a review of his public career as indicated in his speeches
on the various great public movements in which he
participated during a half century of public life, — 1839-
1889. The author is a great admirer of Mr. Bright,
as every student of political progress must be; but he
is altogether more discriminating than most English
writers of the free-trade school are likely to be when
writing on such a theme.

The author gives an excellent account of Bright 's
connection with the an ti- corn law movement, which is
the movement that brought him into public life and in
which his power as an orator and an agitator, rather
than a statesman, was developed. The author is also
much fairer in his treatment of the contemporary ques-
tions then occupying public attention in England, con-
spicuously the chartist movement, than are most histo-
rians of that period. It is the rarest thing to find an
English writer at all associated with the Liberal party
who can do the scantest justice to the chartist move-
ment. It is with difficulty that they can speak of
Fergus O'Connor and his colleagues except in a de-
preciating and too frequently a sneering manner. Mr.
Vince is entirely free from this characteristic bias.

Besides showing Bright's great power as an orator
and leader of reform sentiment, conspicuously in the
anti-corn-law movement, the author gives an account
of his attitude on legislation in favor of labor. He does
not omit to relate, with great kindness of tone to be
sure but with no uncertain sound as to the facts, how

*lohn Bright. By C. A. Vince, M.A. Herbert S. Stone & Co..
Chicago and New York. Cloth. 246pp. $1.25.

373

374 GUNTON'S MAGAZINE [May,

Mr. Bright was utterly incapable of recognizing any
merits in the labor movement, — how he opposed Lord
Ashley, Sadler and the great philanthropic English-
men who aided the laborers in securing the ten-hour
law, with as much invective, cutting sarcasm and un-
relenting antagonism as he did the hide-bound pro-
tectionist and corn-law defenders. Mr. Vince records
the painful fact, which the biographers of Bright
usually omit, that he did not even repent of his op-
position to this class of beneficent legislation, even to
the hour of his death. Notwithstanding that many of
the most conspicuous statesmen in England publicly re-
canted their mistaken antagonism to the factory acts,
Mr. Bright died with the same seeming satisfaction
with his conduct on this question as on the corn laws,
or his opposition to the Crimean War.

Bright is usually regarded as a conspicuous mem-
ber of the Liberal party. As a matter of fact, however,
which Mr. Vince brings out clearly, it was not till quite
late in his career that he became identified with the Lib-
eral party. He was a reformer, with one or two excep-
tions, in the best sense of the word. Though not a
party man he was not a mugwump. He did not make
opposition to everything and everybody a conspicuous
virtue. He was not permanently identified with the
Liberal party because the party was too whiggish, too
illiberal; in fact, it was little more in favor of popular
progress than was the Tory party itself. It only took
on new movements when party expediency necessitat-
ing an issue compelled it to do so. Wonderfully like
the political parties in the United States! Mr. Bright
took a very conspicuous part in the agitation for aboli-
tion of church rates, abolition of stamps on newspapers,
and extension of the suffrage to workingmen. During
our Civil War he may be said to have been the great
power which created public sentiment in England in

I899-] JOHN BRIGHT 375

favor of the Union cause. But for his influence and
oratory, backed by the laborers of Lancashire who
tramped from town to town, on one meal a day, to at-
tend his meetings, England would probably have open-
ly sided with the rebellion, which at one time might
have been fatal to this republic.

Immediately after the close of our Civil War the
movement in England for extending the suffrage to the
laboring class received great momentum from Bright's
endorsement and powerful advocacy. It was largely
due to Bright that this movement became the policy of
the Liberal party, which swept Mr. Gladstone in line
as the champion of the laborers' right to vote. Then
Mr. Bright became a veritable party man and was a
Liberal, and when he became a Liberal and a partisan
he had as little patience with deserters as do the Quays,
Crokers and Platts of the United States. It was in the
debate on the Third Reform Bill (1867), when the Hon.
Robert Lowe (afterwards Viscount Sherbrook), a Lib-
eral, made a vigorous speech opposing the extension
of the suffrage on the ground that the laborers were
not fit for it, that Mr. Bright made the ever famous
speech characterizing him and his co-deserters as retir-
ing to the " Cave of Adullam." Ever afterwards they
carried the political stigma of " Adullamites," and in
reality were the English mugwumps. As Mr. Bright
truly pointed out, these English mugwumps had neither
the character, principle nor consistency to be Tories by
principle, nor the courage, foresight or faith in the
people to be progressive Liberals. They were culti-
vated vacillators, who had neither the power to lead nor
the faith to trust the people. This is a political species
that comes to the surface, in small quantities fortunately,
in the evolution of progress in every country.

From this time until a few years before his death
Mr. Bright was the real leader of Liberalism in Eng-

376 GUNJON'S MAGAZINE [May,

land, though never the prime minister. Mr. Gladstone
was the nominal and in a certain sense the real head of
the Liberal party, but he was not the leader. He
always opposed great measures, and became converted
about the time that opposition could no longer prevent
their adoption. Mr. Bright, on the contrary, almost
never changed his opinion. He began with the
advocacy of a reform and stood to it until it was
accomplished. That is why he was frequently too
liberal to be really in the party ranks a great deal of the
time, especially as a young man; but as he grew older
his political program, one measure after another, was
adopted, and unfortunately the list was exhausted before
he died. As a natural consequence, he began to show
evidence of having outlived his usefulness because,
unlike Mr. Gladstone, he was inflexible. What he did
not take on at fifty he could not appreciate at seventy-
five.

His liberal views of religion led him strongly to
endorse the dis-establishment of the Irish Church in
1868, which was the first act of the new Parliament af-
ter the passage of the Third Reform Bill (1867). He could
also heartily aid in the extension of manhood suffrage
to the counties, which was in reality the enfranchise-
ment of agricultural laborers, in 1874. But, despite all
the testimony from every source in favor of the great
benefits derived from the factory acts, and the recanta-
tion of public men like Peel and Graham and Grey and
Gladstone for having opposed them, he placed himself
uncompromisingly in opposition to the nine-and-a-half
hour law in 1874; and when the question of home rule
for Ireland became the issue of the Liberal party in
1886, Mr. Bright, with Mr. Chamberlain the present
Colonial Secretary, Lord Hartington and a few hold-
over Whigs, deserted the Liberal party and really play-
ed the part of Adullamites. From that time till his

1899.] JOHN BRIGHJ 377

death Mr. Bright lost the confidence and political sup-
port of the Liberal party, though he was admired and
even revered for his previous public life. When he
died, in 1889, he was in the shadow of political decline.

John Bright will ever stand out as one of the great
men and conspicuous leaders of political progress in
England during the nineteenth century, though he
never held office but once. The strength of Mr. Vince's
book is that it gives the strong parts of Bright's career
without forgetting to note these evidences of narrow-
ness which more than once put him athwart the path of
progress of the English masses.

For an appreciative and even enthusiastic but
thoroughly just account of the public career of John
Bright, Mr. Vince's little book is one of the best yet
published.

ENGLAND IN THE NINETEENTH CENTURY*

This is the first volume of what the author calls
"The Story of the People of England in the Nine-
teenth Century," and that is what it really is. It can
hardly be called a history. It is rather a description of
England in the nineteenth century. It is quite unlike
the author's "History of Our Own Times," which cov-
ers the same period. That is a narration of facts,
mostly in the chronological order in which they oc-
curred. This is rather the description of great political
and social movements with the characterization of the
prominent public men of the time, and Mr. McCarthy
has done the work remarkably well.

Although the author has for a long time been a
conspicuous figure in the Irish movement, in and out of
Parliament, he has shown great fairness and impartial-
ity. If the Irish and Catholic questions seem to figure
very prominently in this volume, it must be attributed
to the fact that they were very conspicuous during the
period treated. The consummation of the Act of Un-
ion and the agitation for Catholic emancipation were
two conspicuous events in the first half of the century.
In this book one gets a wonderfully vivid conception of
the character and condition of the English people dur-
ing the reign of the last two Georges. Mr. McCarthy
shows at once a great familiarity with the actual move-
ments of the times and qualities of the men. His ex-
perience in Parliament has taught him how to estimate
the real character of public men. He is entirely free
from the pessimistic, misleading attitude that the pre-
sent is always worse than the past. He indulges in
none of that superstitious hero-worship which attributes

*The Story of the People of England in the Nineteenth Cen-
tury. By Justin McCarthy. Part I, 1800 to 1835. G. P. Putnam's
Sons, New York. Cloth ; illustrated ; 280 pp. $1.50.

378

ENGLAND IN THE NINETEENTH CENTURY 379

perfection to statesmen in proportion to their antiquity.
It has almost become a fad in this country to think of
public men at the beginning of the century as so much
greater and better than the statesmen of the present.
Mr. McCarthy has none of that kind of perverted
vision. On the contrary, in speaking of the great im-
provement in the manners of public men and their atti-
tude toward their enemies since the reign of George
III, he says (page 43): " No speaker on a platform, no
writer in a newspaper, would be tolerated now who al-
lowed himself to indulge even once in a passion of per-
sonal invective against a political opponent, which was
common, even among men of education and position,
during the earlier years of the present century."

The feature that makes this book both attractive in
reading and instructive in fact is the very familiar way
in which the author describes the salient and soul-stir-
ring features of the reform movements. This is done
with an accuracy of fact and sympathy of touch possi-
ble only to one thoroughly interested in the movements
for the good they accomplished to the people. One
cannot read a chapter, or even a page, without knowing
that the author is in thorough sympathy with the pur-
pose and progress of every reform movement he passes
in review. That perhaps accounts for the fact that he
brings out in stronger light than a mere historian ever
does the struggle of the people for every inch of prog-
ress and freedom they accomplish. His description of
the Cato Street Conspiracy, and of the struggle against
religious disabilities, which included the Catholics,
Jews and dissenters or non-conformists, his account of
the efforts to accomplish the first Reform Bill, and his
faithful narration of the life and treatment of the young
" chimney sweep," is as fascinating as fiction and as in-
spiring as revelation. His account of black and white
slavery, which treats of the abolition of slavery in the

38o GUNTON'S MAGAZINE [May,

West Indies and legislative protection to the chimney-
sweep, brings to light a great many facts bearing on
the brutal treatment of labor in the early part of the
century of which ordinary readers of English history
have little idea. The treatment of the chimney sweep
was a part of the treatment of the English factory
laborer in the first third of the century. Of course,
the chimney sweep was not a factory operative but his
treatment was born of the treatment they received.
The factory children were worked fourteen and fifteen
hours a day and beaten with straps and belts for the
slightest neglect or delinquency, sometimes under the
excuse of preventing them from going to sleep.

The use of soft coal and turf for fuel in England
created a great deal of soot, and the poorly built,
crooked, narrow chimneys would frequently get stopped
up, and to clean out the chimneys became a regular oc-
cupation known as chimney sweeping. It was a com-
mon habit for the boss chimney sweep to get little boys,
sometimes their own children, as apprentices to this
craft of chimney sweeping. The little fellow had to
climb up the inside of the chimney and, with a brush
and sometimes a little hoe, scrape off the soot from the
sides. It frequently occurred that the chimney was so
crooked and narrow that it was almost impossible for
the little "sweep " to make his way through. For this
reason the smaller the boy the better he was suited to
the work, and, to be sure that he did not shirk or come
down before he had completely finished his job, he was
compelled to go through and put his head out of the
top of the chimney and- shout " sweep," as a guaranty
that at least he had made a hole large enough for him-
self to get through. It was a very common occurrence
for the little sweep to be sent up the chimney before it
was cold, the fire having only recently been put out for
he purpose of having the chimney swept. A great

1899-] ENGLAND IN THE NINETEENTH CENTURY 381

many cases occurred when the chimney was so hot that
the boy was burned, and in not a few instances died
before he could be taken out.

This sympathy-deadening process increased the
brutality of the masters until they became utterly un-
feeling and heartless in their treatment of the boys.
" In many cases," says Mr. McCarthy (page 271) " as it
was proved by uncontradicted evidence, when a poor
child stuck fast in a chimney a master-sweep declared
that the boy was only shamming, that he was lazy and
stubborn, and accordingly ordered the fire to be again
lighted in the grate, so as to compel the unfortunate
creature to mount the chimney in order to escape the
flames." He tells of one case where a man married a
very slight little woman for a wife, and dressed her in
boys' clothes and made her become a sweep. The abo-
lition of this brutal system, which Mr. McCarthy very
properly describes as slavery, was a part of the great
movement of which Earl Shaftesbury was the leader
and which culminated in the passage of the ten-hour
law in 1847.

This book is truly a story of the English people,
and the story is attractively and instructively told by
one who is thoroughly familiar with the facts as well as
interested in the progress the story reveals. The second
Part, soon to be published, will cover the anti-corn law,
short-hour, chartist and other great movements imme-
diately following the period treated in this volume.

ADDITIONAL REVIEWS

NATURAL ADVANCED GEOGRAPHY. By Jacques
W. Redway and Russell Hinman. American Book
Company, New York, Cincinnati and Chicago. Quarto.
162 pp., with 12-page supplement on the State of New
York. With maps and illustrations. $1.25.

About a year and a half ago we received a copy of
Mr. Redway 's " Natural Elementary Geography," and
reviewed it in these columns. The ' ' Natural Ad-
vanced Geography," a much more formidable and com-
prehensive work, is now at hand and merits commen-
dation quite as unqualified as that we gave to its pre-
decessor. The two books taken together form, so the
preface declares, "a complete and rational school course
in the study of geography; " and that they are so rec-
ognized is attested by the extraordinary favor with
which they have been received by school boards and
teachers throughout the country.

In taking man as the central view-point, and study-
ing geographic facts and phenomena with constant ref-
erence to their effect upon and contributions to human
progress, these geographies are in accord with the
spirit of the times. Furthermore, this method of keep-
ing in the foreground all the time the practical relation
of the subject to human life and experience adds enor-
mously to the interest of the study. The Natural Ele-
mentary Geography begins by treating the immediate
surroundings of the student, the school-room, town,
etc., thence extending out to the state, the nation and
the world. In the Advanced Geography the order is
reversed; it is assumed that the pupils have progressed
far enough in general comprehension of the subject to
permit of beginning now to get a conception of the
earth as a whole. Therefore it treats first of the earth
as a planet, then of the formation of continents and sur-

382

ADDITIONAL REVIEWS 383

face of the land, climate, distribution of life, the races
of men and their industries; then a descriptive treat-
ment of North and South America, Eurasia, Africa,
Australia and the Pacific Islands, Colonial Possessions
and Commercial Routes, in the order named. The
diagrams, illustrations, physical maps and the larger
colored maps are abundant and handsome, besides be-
ing directly correlated with the text. In connection
with every topic discussed, questions and suggestions
for spurring the interest and holding the attention of
the student are introduced, sometimes right in the text
and sometimes in the form of correlations and compari-
sons. The method of introducing these features is the
outcome of practical experience in educational work.

The book, briefly characterized, is one of the mile-
stones in the highway of scientific educational progress.

SOCIAL SETTLEMENTS. By C. R. Henderson, D.D.
Lentilhon & Co., New York. Cloth. 196 pp. 50
cents.

We welcome this little volume because it conden-
ses a large amount of scattered information on a very
important phase of social reform work. Dr. Hender-
son gives the history and present status of the principal
social settlement institutions both in England and the
United States, and a detailed description of the lines of
work in uplifting, inspiring and stimulating the people
of the slums. The general plan of work is practically
the same in all the settlements, consisting of instruc-
tion, social gatherings, lectures, manual training,
games, literary societies, economic debating clubs,
local visiting, and participation in municipal reform
work in the districts where the settlements are planted.
These various methods of work are classified under
eight general heads: — physical health, economic wel-
fare, instruction, aesthetic culture, sociability, political

384 GUN TON'S MAGAZINE [May,

co-operation, charity and reforms, and religion. Chil-
dren, young people, and adults are reached under all
these heads.

In commenting on the work of the settlements,
and the conditions brought to light through their in-
vestigations, the writer says: —

' ' Workers among wage earners become aware of a
certain wide-spread distrust of law and government.
The belief is only too general that government is un-
der capitalistic control. Socialists naturally and con-
sistently foster this belief. The reports of legislative
corruption and purchase of aldermen, tend to deepen
and fix this dangerous conviction. The great journals
and magazines carry the news to all parts of society.
In times of strike the members of trade unions find the
policemen always protecting property and rivals. If
they go to law the appeals to federal and supreme
courts take litigation far beyond their reach. They
may not see the other side; the difficulties of corpora-
tions to secure fair treatment in face of popular preju-
dice; the almost certainty that a local jury will not be
just to a rich man ; and the legislation inspired by spite
against the successful. They very naturally dwell on
their own side of the grievance, and this brooding over
real and fancied wrongs makes them opponents of law."

Hitherto it has been difficult for the capitalists and
public men of the country to realize the strength and
universality of this feeling among the working class,
and the ominous peril that lies in it unless a different
attitude is taken toward the organized movements of
the laborers for self-improvement, and serious attention
devoted to the matter of their economic education.
The settlements contribute somewhat to this, by fur-
nishing a meeting ground, as it were, for the represen-
tatives of all the social classes, and a place where griev-
ances can be freely discussed and modifying influences

.1899.] NEW BOOKS OF INTEREST. 385

brought to bear upon the revolutionary spirit of the
sections in which they are located. This, however, is
not entirely sufficient; because there is lack of any
very definite leadership of ideas with regard to the so-
cial and economic problems the slum conditions pre-
sent; and, as the author himself says, the settlements
•are often complained of as being hot-houses for the de-
velopment of all sorts of revolutionary ideas, rather
than really strong educational forces for the correction
of dangerous social tendencies.

There is an immense field for this settlement work,
in the line of stimulating broader living and higher
thinking, and rousing the less active inhabitants of
these districts from the stupor that poverty and degrad-
ing conditions have induced. The work should be
supplemented, however, by an educational propaganda
dealing directly with the social theories for the regen-
eration of society that take root in these sections, and
pointing out the truly economic lines of progress to-
wards better and more wholesome social conditions.

NEW BOOKS OF INTEREST

HISTORICAL AND DESCRIPTIVE

Harper s Pictorial History of the War with Spain.
This is to be issued in thirty-two parts, each of sixteen
\\Y± by 1 6 inch pages, with colored frontispiece; suita-
ble for binding when the edition is complete. It is to
consist of contributions by a large number of army and
navy officers, war correspondents, etc., and will be ele-
gantly illustrated and printed. To be sold by subscrip-
tion, at 25 cents a part. This reminds one of Harper's
famous Pictorial History of the Civil War; but likewise
forcibly illustrates the advance in typographical and
bookmaking art since that time.

Slav or Saxon; A Study of the Growth and Tenden-

386 GUNTON'S MAGAZINE

cies of Russian Civilization. By William Dudley Foulke.
Second edition, revised. G. P. Putnam's Sons, New
York. i2mo. 141 pp. $1.00. This book was originally
published in 1887, and the revised edition is now issued
because of the increasing signs of a conflict between the
Slavic and the Saxon races. It embodies an historical
sketch of Russia, and description of its territory, govern-
ment and people.

ECONOMIC, SOCIAL AND POLITICAL

Municipal Monopolies. By Edward W. Bemis, John
R. Commons, Frank Parsons, M. N. Baker, F. A. C.
Perrine and Max West. T. Y. Crowell & Co., New
York and Boston. Cloth. 691 pp. $2.00. This is vol-
ume XVI in Crowell's Library of Economics and
Politics. Such topics as water works, electric lighting,
telephones, street rail ways, gas plants, etc., are discussed,
and, as might be imagined from the names of the
authors, the general attitude is highly anti-capitalistic*
The writers work around to one and the same conclu-
sion in each contribution, — that complete municipal
ownership and operation of all these quasi-public func-
tions is our only hope of salvation, and the very acme
of municipal reform.

Fields, Factories and Workshops; Or, Two Sister Arts \
Industry and Agriculture. By P. Kropotkin. Cloth. 315
pp. Gilt top. $3.00. The keynote of this book is de-
centralization of industry, — an ideal which, as might be
expected, is very dear to the heart of this well-known
exponent of anarchy as the true philosophy of human
society. There is something almost pathetic in the
seriousness with which he argues for a return to the
system of small industries, village life and individualis-
tic agriculture, as though he really believed that the
whole onward march of human society could be re-
versed and made to go that way.

THE BEST IN CURRENT MAGAZINES

Scribners for May contains the second installment
of " The Ship of Stars," by Arthur T. Quiller-Couch,<
the English author upon whose literary ability and pro-
mise the Scribners place an extremely high estimate.-

The May Century fairly bristles with war articles^
The naval battle of Santiago is described by every of-
ficer (except Captain Clark of the Oregon) who com-
manded an American vessel in that conflict.

McClures has a story by Rudyard Kipling, — " The
Flag of Their Country," — in its May number.

Senator Lodge writes of the land and naval battles
of Santiago in the May Harper s ; being Part IV of his
history of "The Spanish- American War." Miss Mary
E. Wilkins contributes a New England story of the
Revolution, — "Catherine Carr."

A short but rather suggestive article in Lippincott's
this month is * ' The American Fondness for Move-
ments," by Edward Leigh Fell.

Brown University is described in an illustrated arti-
cle by Henry Robinson Palmer in the May New Eng-
land Magazine ; and Clifton Johnson writes on ' ' Work
and Workers in Rural England." This also is illus-
trated.

English experience in colonization in Australasia is
discussed by H. de R. Walker under the title "Aus-
tralasian Extensions of Democracy, "in the May Atlantic
Monthly. Henry W. Farnum writes on ' ' Some Economic
Aspects of the Liquor Problem."

In the current number of the Review of Reviews
Dr. Albert Shaw discusses "The New San Francisco-
Charter;" and Prof. John Bassett Moore, ex-Secretary
to the American Peace Treaty Commission, writes on
" International Law in the War with Spain."

387

INSTITUTE WORK

PRACTICAL MUNICIPAL REFORMS

Municipal reforms are among the most important
problems in American public life. They are important
because they directly affect the policy and government
of our cities, into which the American people are rapidly
becoming more and more concentrated; and they are
still more important as immediate problems because
they have hitherto been so very much neglected. This
neglect of municipal problems for state and national
politics has permitted, in many of our very large
cities at least, a sort of local czardom to arise, based on
' ' patronage and pulls. " Political party managers have
been so anxious to secure success in state and national
politics that the management of public affairs in the
cities has been left to ward or political bosses, the only
result required being to deliver a large party vote for
the state and municipal tickets. This has been made
relatively easy by the large proportion of ignorant and
alien population in the large cities.

For these reasons, which have not existed to the
same extent in other countries, municipal politics seems
to be in a more backward or lower state in this than in
almost any other country. While we lead the world in
most other respects, we lag behind in municipal gov-
ernment. Very naturally the outcome of this tendency
is a civic revulsion, demanding radical municipal re-
forms. As is always the case with greatly neglected
social problems, the reform spirit takes on an extreme
and sometimes revolutionary character. This is strictly
the case in municipal politics at present. There are
two general propositions that have marked the progress
•of civic reform agitation in this country. First, the
separating of municipal from state and national politics;

388

PRACTICAL MUNICIPAL REFORMS 389

and, second, municipal socialism, demanding that all
semi-public functions like furnishing- gas, transportation,
houses for the poor, etc. , should be conducted by the
public.

The first proposition anticipates a group of con-
servative and rational reforms. The second seeks to
improve municipal government by establishing a sort
of paternal municipal republic. The idea of separating
local government from state and national politics has
arisen because of the increasing practice of using the
votes of city populations almost entirely for the promo-
tion of state and national policies and parties, and so
subordinating local problems to state and national
issues, sometimes even ignoring the local interests alto-
gether. But it often happens that in the zeal for reform
or for correction of abuses we depart radically from the
sound principles of government which we tenaciously
adhere to in other respects. This is conspicuously true
of municipal problems in this country. The American
people believe in party government. They believe in
the principle of evolving, digesting, and ultimately
carrying into practice public opinion as evolved and
crystallized through party action. This is sound policy*
It is the only way of converting public opinion into
public policy under democratic institutions. This
principle ought to run through the whole political com-
munity, not only national and state but municipal as
well; so that both political parties should stand for a
policy in every department of American life, a policy
for a federal government, state government and muni-
cipal government. In view of the existing prejudice,
however, regarding the influence of national parties
upon local government, it may be that segregation is
inevitable, although no such movement has yet proved
very successful. In either event, municipal reforms,
must come, and come rapidly if the integration of our

390 GUNTON'S MAGAZINE [May,

national life is to be preserved. The cities are becom-
ing more and more the centers of population, and
furnishing the social problems which are now perplex-
ing the statesmanship of Christendom.

Practical municipal reforms, therefore, whether
accomplished by the action of national party politics or
by the separation of municipal from national politics
and the organization of purely municipal parties, must
take the form of improving the conditions which direct-
ly affect the life and influence the character of the indi-
vidual inhabitants of our cities. First among the prac-
tical reforms in this direction is education, in its broad-
est sense. There are two great sources of education.
One is in the school and the other is in the home and
its environments. The furnishing of adequate school
facilities of the very best quality should be a prime
duty of municipal government. No excuse about tax-
ation should prevent the public expenditure necessary
to furnish not merely seating room for all the children
of school age in our cities, but seating room under the
most attractive and inspiring conditions. Second, the
public school system of every city should extend down
and include the kindergarten. Public kindergartens
should become as essential a part of the public educa-
tional system as the grammar school. The educational
influence of the kindergarten is in many respects more
far-reaching than that of the grammar school. It
reaches back into the homes in a way that the grammar
school never does and cannot do. It brings educational
institutions in contact with the mothers, and in this
way often does quite as much for the mothers as for
the children, particularly among the very poor. It
makes every child a messenger of cleanliness to the
home.

Another feature of public education should be a
provision of opportunities for economic and political

PRACTICAL MUNICIPAL REFORMS 391

study, through classes, lectures and literature, for the
great mass of the young people who have left school
and are being prepared, solely by newspapers and
workshop contact, to become active citizens. From the
time they leave the public school till the time they be-
gin to vote they are educationally adrift, with practical-
ly no opportunity for acquiring rational and systematic
information, much less pursuing the study of public
questions upon which they are to pass as citizens, and
the wise solution of which determines the character of
our institutions and civilization.

Another feature of special importance in municipal
policy is public improvements, such as clean and well-
kept streets, public parks, public gardens, free muse-
ums, public baths, and other sanitary conveniences.
The condition of the streets and other surroundings
outside the home has much to do with the condition of
the inside of the home. It is as true of wholesome do-
mestic habits as it is of personal tastes, that the im-
provement begins outside and penetrates inward.

The housing of the poor is another proposition of
great municipal importance. If the people of the na-
tion live in poor houses, nothing can make them good
citizens. The character is largely made in the home
and its immediate environment. Degrade the home
and nobody can lift the people; but expand, elevate,
civilize and refine the home, and nobody can long de-
grade the people. The question of housing the poor,
which involves to some extent the tenement-house
problem, is one upon which there is likely to be more
difference of opinion than on many other subjects. We
are very much disposed to think the solution of this prob-
lem is somehow to provide conditions by which the poor
can own their own homes. In large cities or cities of a
moderate size this would be a great mistake. Very
poor people if they build their own houses would always

393 GUNTON'S MAGAZINE [May,

build very poor ones, and once owning an inferior shanty
they become a resisting power to improvement. They
will resist public expenditures for local .improvement,
because they have to pay the taxes. Indeed, if such a
thing were possible as to imagine that the poorest tene-
ments in New York City were owned by those who lived
in them, that would probably constitute an insuperable
barrier to tenement-house improvement.

As it is, the sanitary conditions in modern tenement
houses are very much superior to those of the middle
class who own their own houses, so much so that taken
as a class the inhabitants of tenement houses in New
York City show a mortality of some four to the thou-
sand less than the average mortality of the entire city.
On reflection, the reason for this is not difficult to un-
derstand. Tenement houses, .especially the modern
ones, are built by capitalists as an investment. No-
body is in sympathy with the capitalist. He cannot
build tenement houses without first submitting the
plans to the department of construction, and also re-
ceiving the approval of the board of health. The senti-
ment of the community — of the laborers who are going
to live in these houses, and the people who are not go-
ing to live in them — is all in favor of making the capi-
talist use the best material, furnish the maximum
amount of ventilation and light, and supply the most
modern methods of plumbing and sanitary devices. In
this way the whole moral force of the community, and
the law, are brought to bear upon the capitalist, to in-
sure that every new building that goes up shall con-
tain the best that sanitary science has developed. In
this way the poorest people finally get the very best
improvements, which they would never voluntarily go
to the expense of putting into their own houses if they
built them themselves.

It is undoubtedly true that municipal government

I899-] PRACTICAL MUNICIPAL REFORMS 393

furnishes more opportunities for public ownership than
either state or national government. The water supply
may very properly be a matter of public ownership, be-
cause the consideration of prime importance in water
supply is not economy in supplying the water but its
abundance and purity, regardless of what it costs. Edu-
cation may well be a matter of public control, because
here again the important fact in education is not its
cheapness but its extent, uniformity and perfection.
Even though it costs twice as much to educate children
in public schools as in private, it would still be economy
in a large sense, and good public policy, to have edu-
cation furnished by the municipality, because in that
way the very best may be and ought to be uniformly
supplied, (though thus far it has not been) and com-
pulsory attendance insisted upon. Good education is
cheap at any price, and poor education is dear at any
price. The economy in education comes not in saving
the pennies in taxes, but in saving and expanding the
character of the citizens. Civilization is cheap at any
price.

This is also true of the care of the streets, sewerage,
public parks, libraries, baths and the like.

The housing of the poor is of an entirely different
character. For reasons just given, the best results in
the housing of the poor will be obtained by having the
houses supplied by private capital. If the tenement
houses were the property of the city, we should have
the same difficulty in a less degree that presents itself
in the ownership of the homes by the laborers. The
condemning of poor buildings and erection of new ones
will be resolutely resisted by the laborers if they own
them, and more difficult to secure by the public if the
public owns them; but when they are owned by
private capitalists then the public sentiment of both
those who live in them and those who do not can be

394 GUNTON'S MAGAZINE

most effectively brought to bear for exacting the best.

This is true also of transportation. So long as the
public criticism and power of legislation and govern-
ment are on the one side and the corporation on the
other, the pressure of public opinion and law can con-
stantly be brought to bear to make the corporations fur-
nish the best that science and civilization can give. The
recent outcome of the attempted Amsterdam Avenue
grab by the Third Avenue Railroad in New York city
is a striking illustration of this fact. It was only neces-
sary for the people to realize that the corporation was
acting contrary to the public interest to invoke the leg-
islature at Albany and rule the corporation off the
avenue altogether.

Municipal problems, then, are of paramount im-
portance, but their importance does not consist so
much in transferring functions to the government as it
does in creating a public demand for specific lines of
municipal improvement. Municipal reform will come
when the people demand it, and it will never come be-
fore, whether we have public or private ownership of
any or all of the functions of public service. Reform
means nothing until it is reduced to specific demand
for specific things. The conditions and character of
municipal government in the United States are no excep-
tion to this general rule. Reforms will be accomplished
just in proportion as they are feasible and reduced to
definite specific demands, and no faster.

WORK FOR MAY

OUTLINE OF STUDY

The last topic in our study of Political Science is
second to none of the others in importance. In many
respects the problem of municipal government and pol-
icies is of supreme consequence, to-day as never before.
The sub-divisions of the subject as shown in the curri-
culum are as follows:

XI. MUNICIPAL GOVERNMENT.

a National parties and local politics.

b Public education.

c Public improvements.

d Municipalization of franchises.

e Housing of the poor.

f Tenement-house problem.

g Public and private charity.

REQUIRED READING

In GUNTON'S MAGAZINE for May, the class lecture
on " Practical Municipal Reforms; " the notes on
required and suggested readings, and article : ' ' What
Shall the City Do? " In " Principles of Social Econo-
mics," the "Summary and Conclusion." In "Wealth
and Progress," Chapters VIII and IX of Part III. In
GUNTON INSTITUTE BULLETIN Vol. II (the current sea-
son), the following lectures: No. 5, "Our Municipal
Problems;" No. 23, "Poor Man's Clubs;" No. 24,
" Consumer's Leagues and the Sweatshops;" No. 28,
"Taxation of Franchises;" No. 29," "Rapid Transit and
City Evolution." In GUNTON'S MAGAZINE for March,
1899, article on " Municipal Socialism."
SUGGESTED READING *

In Dr. Albert Shaw's * ' Municipal Government in
Great Britain," Chapters I, III, VIII and IX. In

* See notes on suggested reading for statement of what these ref-
erences cover. Books here suggested, if not available in local or trav-
eling libraries, may be obtained of publishers as follows.:

Municipal Government in Great Britain. By Albert Shaw,

395

396 GUNTON'S MAGAZINE [May,

Devlin's " Municipal Reform in the United States,"
Chapters I, II, VI and VIII. In Milo R. Maltbie's
" Municipal Functions," Chapters VIII, IX and X. In
" Man and the State," monograph by Dr. Lewis G.
Janes on "The Problem of City Government." A col-
lection of papers on "Municipal Monopolies," by
Edward W. Be mis and others, recently published in
book form, gives the public ownership argument with
reference to all such enterprises as electric lighting,
gas, telephones and street railways. The volume will
be reviewed in these pages within a short time.

NOTES AND SUGGESTIONS

Required Reading. — The curriculum topic this month
is covered by the class lecture and articles specified in
GUNTON'S MAGAZINE and the five BULLETIN lectures
enumerated. The article on " Municipal Socialism" in
the March magazine is especially important. The two
chapters assigned in "Wealth and Progress" are the
last in the book, and belong properly to the topic "The
State and Labor," which was one of our subjects for
study last month. As explained at that time, these
two chapters were held over until the present month
for the sake of a more equal division of work. They
treat of * * Relative Industrial Progress in England and
Other Countries since 1850," and " Social and Political
Necessity of an Eight-Hour and Half-Time System."

Suggested Reading. — Dr. Shaw's "Municipal Gov-
ernment in Great Britain " is by all odds the most com-

LL.D. The Century Company, New York. 385 pp. $2.00. Munici-
pal Reform in the United States. By Thomas C. Devlin. G. P. Put-
nam's Sons, New York. 174 pp. 75 cents. Municipal Functions.
By Milo Roy Maltbie, Ph.D. Reform Club, Committee on Municipal
Administration, 52 William Street, New York. Paper, 50 cents.
Municipal Monopolies. Edited by Edward W. Bemis, Ph. D. T. Y.
Crowell & Co., New York and Boston. 691 pp. $2.00. Man and the
State. Popular Lectures and Discussions before the Brooklyn Ethical
Association. D. Appleton & Co., New York. 558pp. $2.00.

I8Q9-J WORK FOR MA Y 397

prehensive and satisfactory exposition of English urban
government that has appeared. The relative excellence
of English municipal government makes it an import-
ant subject of study in this country, even though much
of their success is due to tradition and a habit of re-
garding and acting upon these matters which has
never been developed in the rapid growth of American
cities. We have suggested as specially important the
chapters on: " Introductory: The Growth and Problems
of Modern Cities," " The British System in Operation,"
**The Government of London," and " Metropolitan
Tasks and Problems." Other chapters well worth
reading describe the municipal government of Glas-
gow, Manchester and Birmingham, and the social activi-
ties of British towns.

Devlin's " Municipal Reform in the United States,"
was reviewed in the January number of this magazine.
It is a sensible, practical and really suggestive little
book. Whoever consults it at all will probably read it
through, but we especially call attention to the chapters
on "Reform Efforts," "American Conditions," "Cost
of City Government," and "The Official, The Press,
and The People." The author writes directly with
reference to American city conditions and problems.

Mr. Maltbie's "Municipal Functions" is reviewed
in detail in the article " What Shall the City Do? " in
this number, and requires no further comment here.

Dr. Janes' lecture on "The Problem of Municipal
Government " is an analytical review and criticism of
American experience in this line, with many practical
suggestions. Particular attention is paid to the political
and electoral aspects of the problem.

LOCAL CENTER WORK

Our study of municipal government this month
marks the conclusion of the course on Political Science.
This being the case the time is opportune for review

398 CLINTON'S MAGAZINE [May

work. The closing meetings of local centers should be
of a somewhat general character, summing up as far as
possible the chief points of the year's work. Of course,
the topic for the current month should not be neglected
by any means; it is one of the most important in the
course. We would offer the following suggestions for
use in making up programmes of meetings:

Papers on : — National and local politics ; Cities as
forces in civilization; Importance of good municipal
government; Public improvements a social duty; Tene-
ment-house reform; City slums, and what is being done
to reform them; Poor relief, wise and unwise; The
government of cities in Great Britain ; Evils in Ameri-
can city government; Practical city reforms.

Debates on: Resolved, That municipal elections
should be conducted solely on municipal issues. Re-
solved, That the future success of democratic govern-
ment requires the regeneration of tenement house and
slum districts, abolition of sweatshops, and more am-
ple educational work in our great cities. Resolved,
That city gas and electric lighting systems should be
owned and operated by the municipality. Resolved,
That street railway systems should be owned and op-
erated by the municipality.

THESES

Students who desire to receive certificate of com-
pletion of the two years' course on Social Economics
and Political Science are required to prepare and sub-
mit to President Gunton a thesis on some approved
topic, at the end of each year's work. To do this will
be found of great value to the student, because it neces-
sitates a review of the subject and clear comprehension
of the general substance and point of view of the
course. Preparation of a thesis is not obligatory, but
without this test we are unable of course to certify to
the student's satisfactory grasp of the subject. Theses

I899-] WORK FOR MA Y 399

should be not less than 1000 nor more than 3000 words
in length, on some one of the following topics, and be
sent to the Institute office by June ist:

Social and Moral Basis of Patriotism. How Indus-
trial Conditions Affect Political Freedom. The Monroe
Doctrine and Territorial Expansion. Theory and
Practice of Tariff Protection. Scientific Taxation and
its Results. What will Solve our Money Problem?
Trusts and Social Progress. Labor Unions in Modern
Industry. What Good Municipal Government De-
mands.

If extension of time, or a different subject for thesis,
is desired, special application should be made to the
Institute office.

QUESTION Box

The questions intended for this department must be accompanied by
the full name and address of the writer. This is not required for publica-
tion, but as an evidence of good faith. Anonymous correspondents will
be ignored.

Editor GUNTON'S MAGAZINE : Dear Sir : — How
would State Labor Insurance affect the present incor-
porated insurance companies and fraternal beneficial
societies ?

SUBSCRIBER, Philadelphia, Pa.

It would only affect insurance companies in so far as
they insure wage workers for amounts to be received
and used during life, which is very little. Labor in-
surance would hardly affect that class of policies which
insure for amounts to be paid at death, because it does
not insure for income after death but only for income
while living. Labor insurance is not against death but
against old age, and thus is the reverse of most insur-
ance systems. Fraternal benefit societies are also
mostly for insurance against sickness and death and, so
far as we know, none provide for incomes during old
age ; so that in reality labor insurance such as we advo-

400 GUNTON'S MAGAZINE

cate is something- entirely in addition to and fills a
function not filled by any other insurance system. In-
stead of injuriously affecting volunteer insurance or-
ganizations, national labor insurance would probably
increase it, because it would make the benefits of in-
surance, in one feature at least, universal, and as people
become more acquainted with the advantages of the
insurance principle they become more inclined to insure
in different directions and for different purposes. The
great bulk of insurance to-day is held, not by people
who are most in need of it, but by people who are
comparatively well off but are intelligently interested
in providing against unforeseen contingencies. Labor
Insurance would only be extending the principle to
another large class and so making insurance more uni-
versal throughout the community.

GUNTON'S MAGAZINE

VOL. XVI JUNE, 1899 No. 6

ECONOMICS AND PUBLIC AFFAIRS

Frontispiece ... . Andrew Carnegie

The Tether of Large Fortunes .... 401

Atkinson and Freedom of Discussion . . . 409
Taxation of Corporation Franchises . . . 417

Editorial Crucible : Free trade as the universal panacea —
Is Siberian exile to be abolished ? — Governor Roosevelt's
stand on franchise taxation — Taxing sun, moon and stars !
— The Philippine plan — The tariff and wool prices, again
— Pulpit pessimism on trusts ..... 424

Civics AND EDUCATION

City Advantages in Education ..... 430
Civic and Educational Notes: A slum experience-
More model tenements . . . . . . 441

SCIENCE AND INDUSTRY

Powers and Perils of the New Trusts,—//. Hayes

Robbins 443

Science and Industry Notes: Child labor law in
Nebraska— Wages and cost of food in India— Economic
concentration in the liquor business . 457

CURRENT LITERATURE

"Crooked" Reasoning on Taxation . 461
Additional Reviews : The Santiago Campaign, iSgS —

Stories of the Old Bay State . . . 47°

New Books of Interest ...... 473

The Best in Current Magazines .... 475

GUNTON INSTITUTE WORK

Announcement . . . . . . 476

Time Extended for Preparing Theses . 476

Question Box 477

Copyrighted^ iSqq

Committee of Selection :
THOMAS B. REED.
EDWARD EVERETT HALE.
AINSWORIH R. SPOFFORD.
WILLIAM R. HARPER.
ROSSITER JOHNSON.

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GUNTON'S MAGAZINE

ECONOMICS AND PUBLIC AFFAIRS

THE TETHER OF LARGE FORTUNES

The retirement of Mr. Andrew Carnegie from
business, with the announcement that he intends to
devote the remainder of his life to giving away his
fortune of $150,000,000, has given rise to a good deal
of discussion of millionaires and their fortunes. Mr.
Carnegie has some rather unique characteristics. For
a time he took considerable pains to announce in dif-
ferent ways that it is very unfortunate for a young man
to be born with a fortune, and that it is not creditable
for a man to die^ rich, because by so doing he really
handicaps his sons or other relatives to whom the
fortune passes. Since the advent of his little daughter,
however, this particular phase of his philosophy of
wealth has been less emphasized, and it would almost
seem as if the little girl were in some danger of being
terribly handicapped.

Yet, as a part of that idea and not inconsistent with
it, Mr. Carnegie is credited with announcing that in re-
tiring from the cares of business he is going to devote
himself to becoming a public benefactor in giving away
his immense fortune. To perform this task wisely may
indeed be quite as difficult as it was to earn it. In
accumulating a fortune by successfully conducting pro-
ductive enterprise, a person is sure to benefit the com-
munity in ways that are economic and permanent,
because the helpful influences which arise from pro-
ductive industry operate silently and unconsciously
through the distributive forces of society. Millions of
new wealth may thus be created and distributed in

401

402 GUNTON'S MAGAZINE [June,

wages and profits and other forms of earnings which
are sure to find healthful lodgment throughout the
community. But when a single individual undertakes
to make a business of distributing a hundred or more
millions, there is danger of considerable wasteful mis-
placement. Yet this step of Mr. Carnegie's has met
with a good deal of approval, and, but for the misfor-
tune of the Homestead affair, which will probably
never be entirely erased from his shield, Mr. Carnegie
would receive well nigh universal applause.

There is a very strong feeling abroad, and it seems
to be growing, that capitalists, and especially multi-
millionaires, are a menace to public welfare, in grab-
bing the world's wealth to the impoverishment of the
great mass of the community. Hence Mr. Carnegie's
new departure — for it is about the first case of the kind
that ever occurred — is regarded as an example to be
emulated.

It is quite an open question whether, if all million-
aires should follow Mr. Carnegie's example, they would
really render better service to the public. He made a
very sensible remark on this subject when he said the
reason so few rich men retire from business is that
while they have plenty to retire from they have little
to retire to. In other words, their lives have been so
absorbed in the pursuits of industry, out of which their
fortunes have been made, that there is not enough in
other walks of life to attract them, or even to make life
tolerable to them if they should leave business alto-
gether. This is very true. The men of great business
affairs are tied to their business long after they have
made adequate fortunes, because they cannot leave it.
Life would be a burden to them if they did. In short,
to continue in business is the only way to them for life
to be worth living.

I899-] 1HE TETHER OF LARGE FORTUNES 403

This brings up a side of the life of great business
men and millionaires that is generally overlooked by
those who insist that the industrial magnates who con-
trol great enterprises are ' ' gobbling all the benefits of
civilization." A little consideration of this side of the
problem reveals the fact that, after all, even million-
aires can only really take unto themselves the amount
of wealth that their social life and character can absorb.
Very few of them can really absorb more than $25,000
a year. They may spend $100,000, but they give it
largely to other people; the rest of the income from
their millions goes directly or indirectly to society. As
the capitalist cannot use by his own social absorption
but a small portion of his fortune, the rest must be
invested productively or it is in danger of slipping
from him. In reality, both the millionaire and his
wealth, outside of the little he can absorb socially,
are devoted in spite of themselves to the service of
the public. By virtue of a life habit, acquired in the
creation of his fortune, he has become tethered to
the service of production. He has become so closely
tethered to business that he does not even take on as
much of the socializing influence of civilization, does
not really absorb as much of the progress of society,
does not, therefore, enjoy as much of the mellowing
and sweetening influences of culture, as many others
who have not a hundredth or a thousandth part of
his wealth. In short, there are even whole classes
who get far more of the best results of the wealth of
modern society than do the capitalist millionaires
themselves, who have become the closely tethered
servants, not to say slaves, of productive fortunes.

It may be said with some truth that in many in-
stances these servants of fortunes are really dwarfed
on the best side of their nature, and in not a few in-
stances have become indifferent to the great ethical and

4o4 G UNION'S MAGAZINE [June

social movements which are making for a higher type
of human life. This is frequently made a subject of
criticism. They are denounced as mean and selfish,
illiberal and oppressive. But it is more correct to re-
gard them as victims of an exacting industrial life. By
their very superior capacity as industrial organizers,
developers of the world's resources by which wealth is
made cheaper and more abundant and the whole stand-
dard of life raised, they have become tethered to a duty
from which they cannot escape. The notion that mil-
lionaires monopolize the enjoyment of their millions is
wholly unwarranted. They really get the benefit only
of a diminishing proportion of an increasing product.
In proportion as their fortune increases their exclusive
enjoyment of it becomes relatively smaller. What-
ever else may be said, it is obvious that the great
millionaire capitalists of modern times are drudges to
their fortunes, and indirectly to the community.

From an immediate moral point of view it may
seem to be a misfortune that the class who contribute
most to the possibility of civilization should thus be
dwarfed by the process, but this seems to have been
inevitable under the circumstances. Thus far it appears
to have been an inexorable edict of evolution that the
efficient few should render exceptional service for the
benefit of the less efficient many. In no other way
could modern progress have been possible. The appli-
cation of science through the use of machinery, which
periodically has involved the re-organization of industry
into larger and more economical concerns, has neces-
sarily brought with it more and more exacting demands
upon the managing captains. This movement toward
greater productive efficiency, which every hour is in-
creasing the world's wealth, has practically involved
forcing successful capitalists into a business groove,
which is the dwarfing process complained of. It is a

1 89Q.] THE TETHER OF LARGE FORTUNES 405

rare exception to find a man really broad, generous,
public spirited and well rounded out at the same time
that he is building up his fortune. His sons may be
broader, more liberal and highly cultivated; the com-
munity is progressing, but he is immersed in the
responsibility of successfully conducting an enterprise
which makes this very broadening progress possible for
others.

The capitalist is not only a servant in the highest
sense to civilization, but his very service so shapes his
habits and desires as to make it more difficult for him
to escape than to continue the drudgery. It is very
doubtful if one per cent, of capitalists to-day could
retire from business at sixty-five without being less
useful and less happy than they would be by continuing
in the harness.

Of course, if industrial progress had this effect
upon all the community it would be disastrous indeed.
It would neutralize its own benefits. But fortunately,
in this case as in the case of labor displacement, the
sacrifice of personal disadvantage is limited to a few
and the benefits are extended to the many, so that the
great mass whose tastes, habits and life create the
standard gf civilization and the environment for each
individual are helped by the process.

It is true that this warping or dwarfing influence is
a feature almost peculiar to modern industry. At least,
it has very much increased with the growth of modern
methods. The farther back we go the more we find the
condition where the employer was an easy-going,
paternal kind of man, largely a public character, the
mayor of the town, the advisor of the widow, and a
sort of godfather to the community, and if we go still
farther back where there were practically no employers
and everybody worked for himself, this element did not
exist but barbarism was the lot of all. Neither was

4ob GUNTON'S MAGAZINE [June,

there any dislocation of laborers in that primitive simple
state. Both these phases of seeming sacrifice have
come with the colossal movement of progress. It is
fortunate for society, that this whole movement is con-
centrating the dwarfing responsibilities for the wealth-
getting efforts of the world to a smaller and smaller
proportion of society and distributing the results to an
ever increasing number.

For instance, the wage and salary system, which is
a part of this progress, harnesses a constantly increas-
ing proportion of the workers as simple productive au-
tomatons, where their hours are prescribed, their wages
fixed, the quality of their efforts specialized almost to
the point of monotony. In proportion as their duties
become automatic they become unexacting, and to that
extent the nervous force and vital energies of the peo-
ple are reserved to be let loose in the sphere of social
activities in which the gratifications of the higher side
of life come. In the lines where this reaches its high-
est perfection, the drudgery or exacting side of earn-
ing a living is measured by the hours of daily applica-
tion. In proportion as these can be shortened, the
world of social expansion and rounded human cultiva-
tion is enlarged. Thus, by this process, the millions
are .being more and more relieved from the burdensome
narrow rut of life by being made irresponsible parts of
the semi-automatic whole, for the successful manage-
ment of which a smaller and smaller number, relatively,
become responsible.

Of^course, in the philosophic aspect of the case
the question arises, will this always be necessary?
Will progress always demand the sacrifice of the most
painstaking experts in the productive life? It would
seem not. The tendency of this movement is mani-
festly to organize, systematize and centralize, so that
ultimately a large amount of automatic momentum

1899.] THE TETHER OF LARGE FORTUNES 407

will be established, and this will bring relief even to
those at the helm. When the machinery and organ-
ization in an industry has reached approximate per-
fection, or a stage where great revolutions are no
longer possible, what has heretofore required practi-
cal genius to direct becomes an established order,
each part of which almost takes care of itself. When
the presence or direction of no given individual is
indispensable to the movement of the whole, when
the death of the guiding genius would not disrupt
the working of the concern; when that point is reached
— and it has already been reached in some industries —
the capitalist or the great captain of industry will
become more perfunctory, less tightly tethered to
duty, and in common with the rest of the commu-
nity may take on more of the broader and refining
side of life and be less immersed in the drudgery of
business.

But in the evolutionary process which is now
going on they are the drudges of industry. In a broad
view of the subject, therefore, great capitalists in pur-
suing a seemingly narrow life, absorbed by business
and dominated by margins and markets, are rendering
the best service to society of which they are capable,
and the fact that they appear to find the highest
gratification in the pursuit of industry is in this age
at least to the great advantage of civilization.

It is a misfortune that the function of the capi-
talist class is so much misunderstood. It leads to a
great deal of adverse criticism of their conduct, and
tends to sour them towards public interests. They
are made to feel that they are hunted and censured
for their success. They are kept constantly under
the harrow of public criticism and censure, which
tends to make their social life even less attractive
and endurable than it otherwise would be, and here

408 GUNTON'S MAGAZINE

the capitalists as a class lielp to intensify this social
antagonism by too frequently ignoring and defying
public sentiment. They must learn that, right or
wrong, the public is master; that public opinion is
the opinion that rules and will rule; and that it is a
part of good economic investment, a part of wise in-
dustrial statesmanship, to devote a part of the earn-
ings of their enterprises to the education of the peo-
ple, to a broader and more philosophic understanding
of the capitalist's relation to society and society's re-
lation to capitalistic enterprises. It would be a mistake
if the capitalists should evolve the theory that the
true way is to ignore the public till they get rich and
then retire to spend their riches for public purposes.
By this process they would succeed in being disliked
as capitalists and doubted as philanthropists.

The true function of a capitalist is to be a success-
ful organizer and director of industry, and devote a part
of the proceeds to movements of education and public
improvement as he goes along. In that way his con-
tributions are likely to be good investments, involving
little waste and producing the maximum results. In
most cases it is safe to say that the great fortune would
do more good to be left in productive enterprises than
to be distributed in great lumps in any lines of philan-
thropy. What is needed is that the people should un-
derstand the function of the capitalist, and that the
capitalist should understand the need of wealth for pub-
lic improvement. In this way an altogether more har-
monious relation between capital and the community
would be evolved, and the capitalist do his best work
for civilization, make his best contributions to public
improvement, and get a larger and larger personal ad-
vantage put of pursuing an important, and what has
hitherto been an exhausting, life of business drudgery.

ATKINSON AND FREEDOM OF DISCUSSION

Freedom of discussion is a sacred bulwark of demo-
cratic institutions. Whenever the right of citizens
freely to discuss the public policy of the nation is im-
paired, decline of democratic institutions has begun.
Free discussion is the safety valve to wholesome think-
ing and intelligent action, and is indispensable to the
perpetuity of popular government.

Freedom should not be confounded with anarchy.
It has always been difficult for a certain class of minds
to distinguish between them. They seem to imagine
that freedom consists in the absolute and unconditional
right of every individual to say, write and do whatever
he pleases. This is anarchy. So far as it partakes of
the element of freedom at all it is the freedom only of
the savage, who recognizes no rights of society, no
consensus of opinion or rule of action any one is bound
to respect, but only the absolute right to follow one's
own notion.

This is the kind of freedom that Herr Most stands
for, and in the interest of which he served a year on
Blackwell's Island and is now a " martyr hero " among
those who, like him, think government an oppression,
capitalists a band of protected robbers, and the over-
throw of law, order and society a sacred duty.

Mr. Edward Atkinson, though of somewhat differ-
ent temperament and with an entirely different social
setting, is very similar to Herr Most. While he is not
arrayed against the capitalist system — being a capital-
ist himself — he is intellectually an anarchist. He be-
lieves government in the main to be an organized
oppression. It is his habit to denounce as robbery the
collection of revenues which he individually does not
approve. He denies the government's right to do
almost everything that it does in the direction of pro-

409

4io GUNTON'S MAGAZINE [June,

tecting the opportunities and caring for the interests of
its citizens. To be sure, he does not advocate murder
and personal violence, but he preaches the doctrine of
contempt for government. His conception of freedom
is the essence of anarchy; it puts the individual above
society. In civilization, freedom implies society's pro-
tection to the rights of the individual, but this protec-
tion of individual freedom by society implies loyalty of
the individual to society. The savage has chaos and
anarchy but he lacks freedom because he lacks protec-
tection. Nothing paralyzes freedom like insecurity.
The essence of liberty is protection, which only organ-
ized government can give. Hence, with the growth of
society, human freedom has gradually widened until it
has almost encircled the whole earth. This is all the
result of co-operative societary action. The mainte-
nance and recognition of collective social authority is
indispensable to freedom. Anarchy can do without it,
but freedom can exist only with and by it. This so-
cietary action, under every form of government or
type of social organization, affords whatever of security
and freedom exists.

The conditions and extent of freedom differ in dif-
ferent states of civilization, but in every instance the
freedom that exists, be it ever so little, depends upon
recognition of the fact that the final authority rests in
the collectivity or political organization of society.
Government reflects the consensus of the wants and
opinions of the community. The more ignorant and
impotent the people the more despotic the government,
the more intelligent and liberal the people the more
democratic the government.

Freedom, then, does not consist in defying govern-
ment but in supporting and liberalizing it. Freedom is
the child of order, and order is the child of govern-
ment. Under democratic institutions government stands

1899. ] A TKINSON AND FREEDOM OF DISCUSSION 411

for the expressed consensus of opinion of the commun-
ity, and the preservation of freedom demands loyalty to
this organized consensus for the time being, because it
is the highest and only free expression of the people's
will. To defy this or subvert it, other than through the
machinery for developing a new consensus, is to set the
dictum of the individual above organized society and
substitute chaos and anarchy for order and freedom.

Now, this is precisely what Mr. Atkinson recently
undertook to do. The United States government,
wisely or unwisely, is at war with a foreign people. A
great many intelligent people think the war a mistake,
and that it might and ought to have been avoided. Not
a few think the whole policy of which it is a part is con-
trary to the traditions and best interests of this country,
but they recognize that the present administration was
elected by the people of the United States and that its
authority in the matter, for the time being, is complete
and absolute. At the proper time, which is now very
near, the administration and the party it represents will
be called to account for its action, but until then it is
the duty of every citizen loyally to support the obedience
of army, navy and public officials to the orders of
the government, because for the time being they are
the orders of the nation.

Mr. Atkinson ignores this and assumes the right to
defeat the government, not at the polls but on the bat-
tlefield, by the circulation of literature among the army,
denouncing the government and praising the enemy.
Because the government has interposed an objection
and refused to permit the mail service to distribute
his literature among the officers of the army at the
front, he is endeavoring to pose as a martyr to the cause
of freedom of discussion. It is just such people as Mr.
Atkinson who injure the cause of freedom.

Fortunately, however, Mr. Atkinson's headstrong

412 GUNTON'S MAGAZINE [June,

and opinionated performances will not do any serious
harm; as, with only one or two exceptions, even his
mugwump friends decline to support him. It is urged
by some that Mr. Atkinson was very conscientious, that
he did not mean any harm. Of course not. Neither
did Herr Most. It is not a question of honesty of
motive, but of correctness of action. The wrong-
headed people of the world are mostly conscientious
and intensely in earnest. It is their very earnestness
that makes them dangerous. Freedom of discussion,
like freedom of action, is not governed by what a man
thinks he would like to do, or ought to do, but what
the community thinks he should be permitted to do.

As already remarked, freedom implies recognition
of the authority of government, and freedom of dis-
cussion under the most liberal democracy is limited to
creating a public opinion to be expressed at the ballot
box. But it is not a part of the freedom of discussion
to try to influence the army against the goverment, es-
pecially when on the battlefield in the face of the enemy.
The army is the servant of the government, and through
it of the people, and has but one duty, — to obey orders.
Under those circumstances the wisdom or unwisdom of
the policy which led to the fight is no part of the sol-
dier's concern. Soldiers are not expected to pass upon
the wisdom of the orders they receive. As citizens
they have opinions, but as soldiers they have none. So
long as nations need armies, the function of the soldier
must be to obey. Every man who wears the United
States uniform has no freedom of opinion, as a soldier,
as to the wisdom of the work in which he is engaged,
or of the policy of the administration. Any written
or spoken effort to influence officers or soldiers while
on the field in active service against the enemy, to
make them doubt the wisdom of their superiors, ques-
tion the policy of the government, the justice of the

I899-] ATKINSON AND FREEDOM OF DISCUSSION 413

war, or in any way to lessen their enthusiasm and faith
in success is no part of the freedom of discussion but
is downright disloyalty.

This was the tone and purpose of the documents Mr.
Atkinson endeavored to circulate among the officers,
and desired to send to the soldiers, in the army in the
Philippines. Of course the effect, if any, upon the
minds of the soldiers would have been to convince them
that they were engaged in a bad cause, and ought to
lose. He took the precaution to have these documents
made a part of the speech of some anti-expansionist
senator, so as to give them the appearance of official
documents, and it is even a part of his defence now that
they were such. Of course they were nothing of the
kind. A speech in Congress is a privileged utterance,
but its mere publication in the Congressional Record in no
sense makes it an official utterance. .This no one knows
better than Mr. Atkinson.

The nature of his conduct, however, is becoming quite
clear to the American people, and for the most part even
to those with whom he has previously associated; and
this seems to trouble him. In reply to his charge that
"The Times and other papers of like kind are making an
effort to suppress free speech and free mails," the New
York Times very aptly says: "When you join the ene-
mies of your government and exhort them to resist its au-
thority, when you make these men your heroes and de-
nounce Dewey, Otis, MacArthur, Lawton, Hale, Funs-
ton, as criminal aggressors, when you seek to cripple
the military force of your country in the field; in short,
Mr. Atkinson, when you turn disloyal and take up a
traitor's work and expect the Times to follow you, you
expect what cannot be, and you show that you have
lost your powers of perception and of judgment when
you express surprise that we condemn you."

That his performance was disloyal and seditious

414 GUNTON'S MAGAZINE [June,

there can be no doubt, but as to the wisdom of stopping
the circulation of his pamphlets there may be a differ-
ence of opinion. It is urged by some that Mr. Atkin-
son's pamphlets are * ' so unreadable and dull " and so-
" unpatriotic and seditious," that they could influence
nobody against the administration, least of all the offic-
ers of the army in the Philippines; and by others it is
contended that the interference of the government will
serve to give distinction to his pamphlets and cause
them to have a much wider reading. All this may be
true, yet from another point of view it may be a good
thing. In the first place, the government's action
shows there is a limit to the extent of so-called free
discussion, of which Mr. Atkinson's kind of people
needed to be informed. Moreover, it has made Mr.
Atkinson notorious before the American people for dis-
loyalty, and the more generally his pamphlets are read
the more will his unsavory reputation spread. It will
enable the American people more clearly to understand
his true character.

There are few persons in this country who have
enjoyed so much undeserved praise and publicity as
Edward Atkinson. For a generation, with one or two
exceptions, he has been on the wrong side of every
great public question. Although he has managed,
through his pamphleteering ingenuity, to get himself
widely published in a certain class of newspapers, few
men who have conspicuously participated in public dis-
cussions are so unreliable and so frequently wrong as
he. In his own state for a quarter of a century he has
been the most conspicuous antagonist to the beneficent
industrial legislation for which Massachusetts is famous.
There is scarcely a law upon the statute books of the
Bay State in the interest of improving the laborers'
condition which does not bear the imprint of his op-
position. Every phase of the factory acts he tena-

1899.] ATKINSON AND FREEDOM OF DISCUSSION 415

ciously opposed, predicting all sorts of evils and
presenting tables of figures to prove that those already
enacted were injurious. Experience and investigation
have shown his prophecies to be false and his figures
worthless.

As an economist he has not said or written any-
thing to entitle him to distinction. In his book on "The
Distribution of Products, " nearly one-fourth of which is
devoted to "What Makes the Rate of Wages, "he does
not reveal an ordinary acquaintance with the principles
of economic science. In his book on "Taxation and
Wages," which was the re -publication of a series of
newspaper articles, he crudely confounds statute law
with economic definition and deals in the loosest kind
of assertion, on the assumption that his word is author-
ity; such, for instance, as saying that nine-tenths of the
manufactured products in the United States are pro-
duced at a less labor cost than in foreign countries,
which of course every ordinary manufacturer or busi-
ness man knows is not true.

To be sure, he was on the right side of the silver
question, but there he has damaged the cause of sound
money by his loose misrepresentation of facts in the
discussion. With his usual habit of sweeping state-
ment, he issued a pamphlet making the bald assertion
that the cost of producing silver was only from twenty-
five cents to nothing an ounce, and hence in most cases
the entire price and in others all above twenty-five
jnts an ounce was clear profit. Of course, every
>roducer of silver and every practical man having any
:nowledge whatever of the subject, knew this to be a
worthless and misleading statement. It was untrue,
id discreditable to the sound money cause. Indeed,
this has been the character of much of Mr. Atkinson's
rork, and it is doubtful if he has not injured more than
telped any cause of which he has been a conspicuous

416 GUNTON'S MAGAZINE

advocate. By this persistent grinding out of volumin-
ous documents, usually accompanied by wearying
tables, which were accepted largely because of the
difficulty of refutation, he has managed to get himself
vastly overestimated. But this time his lack of loyalty led
him into a field where even his own friends hesitated
to follow.

The claim of his right to do this in the name of
free discussion will mislead no one. Fortunately for
the nation, he is beginning to be correctly estimated by
the public. Even the press is now talking of him as
the " innocent old man from Boston," who " is too old
for punishment and not young enough for reform," and
" would be as much out of place in a federal jail as a
baby on the battlefield." Whatever may be the bottom
sentiment of the country regarding the expansion policy,
the heart of the nation is loyal to its government when
in face of the enemy, and whoever attempts to circulate
sedition among the officers of the army overshoots the
mark and simply discredits himself with the people.

On the whole, there is reason to believe that the
incident is a rather good thing. It may dissipate that
spurious halo which has gathered around Mr. Atkinson,
and reveal him to the American people more nearly as
he is. If his effort to spread sedition in the army, how-
ever ineffective and harmless, serves the purpose of
putting him in the place in which he properly belongs
in the mind and confidence of the American people, it
will have been well worth the little flurry it has created.

TAXATION OF CORPORATION FRANCHISES

The passage of a law by the New York legislature,
taxing corporation franchises, has created an extraor-
dinary amount of public interest in the subject. Cor-
porate interests in the state have been aroused to a vig-
orous opposition, which is sufficiently strong to make
the governor pause and give a hearing on the bill before
signing it. The hearing produced a visible change in
the governor's attitude to the bill, which he was about
to sign, and he called an extra session of the legis-
lature to amend it. His determination to sign either
the original or an amended bill will have at least one
good result; it will force a wide discussion which can-
not fail to contribute something to the education of the
public on the much befogged subject of taxation.

In the estimation of conservative people this bill
labors under the disadvantage of having been advocated
mainly as a punishment to corporations for being rich.
It has been charged, and with some truth, that the
arguments for it were ' ' semi-political, somewhat hys-
terical and largely socialistic in their character." Even
the speeches of Mr. Ford, whose name the measure
bears, all had that semi-socialistic, anti-capitalist flavor.
This semi-populistic character of the advocacy of the
measure has naturally created suspicion and distrust in
the minds of the conservative public regarding it, es-
pecially among those who have not carefully considered
the subject.

On the other hand, speakers and journals who have
suddenly jumped into the harness against the measure
exhibit scarcely less of injudicious class feeling. In-
stead of discussing the merits of the bill in accordance
with the principles of economic taxation, they.^ proceed
to denounce it as a populistic, communistic, confiscatory,

41?

4i8 GUNTON'S MAGAZINE [June,

industry-destroying and' capital-banishing measure.
For instance, the Brooklyn Eagle devoted over a column
of a leading editorial to piling up adjective upon adjec-
tive of denunciation upon the measure, without giving
a single sensible argument against the bill. The most
socialistic advocate of the Ford Bill never descended
to a less logical, more insinuating and demagogical
plane of discussion. This method of treating the sub-
ject is not calculated either to enlighten the public or
secure judicious tax legislation. What is really needed
is less heat and more light on both sides of the con-
troversy.

The doctrine that wealth should be taken by taxa-
tion merely because it exists, as laid down by the single
tax people, is pure confiscation, and should find no
place in the discussion of the subject of equitable and
economic taxation. It is now generally admitted that
corporation franchises are proper subjects of. taxation.
Whatever may have been the motive of the advocates
of the Ford Bill, in constructing the measure they
adopted the policy of simply extending the legal mean-
ing of the terms "land," " real estate" and "real prop-
erty" to include all franchise privileges of whatever
kind and character. This had the obvious effect of re-
ducing corporation franchises to the basis of real estate
for taxing purposes.

This proves to be an altogether more effective
means of accomplishing the end than either the friends
or the enemies of the measure first supposed. As.
might have been expected, a measure drawn from this
motive and under this influence was necessarily crude
and indiscriminating, as the hearing before the gover-
nor brought to light. But a little consideration of the
points made by ex-governor Hill will show that the ob-
jections relate to details and do not affect the principle
of the bill.

TAXATION OF CORPORATION FRANCHISES 419

The first objection urged by Mr. Hill was that ' ' It
constitutes a radical departure from well-established
principles, and confuses the distinctions which have
nearly always existed between essentially different
kinds of property." It would have added greatly to
the clearness and power of Mr. Hill's address if he had
paused at this point long enough to have hinted at
what the "well-established principles" of taxation in
this state are. That would have entitled him to great
distinction as a discoverer. If there is one thing more
conspicuous than another in the hocus-pocus, crazy-
quilt method of levying taxes in New York state, it is
the entire absence of {any " well-established principle."
It is the very effort to make * * distinctions " between a
multitude of different kinds of property for the purpose
of taxation that has made the tax system of the Empire
State such a confused jumble.

The simplicity of the plan, which most people
would regard as a great virtue, Mr. Hill declares "con-
stitutes its chief danger." For the purpose of be-
fogging and evasion it may, but- not for the purpose of
inexpensive, equitable taxation. After charging that it
would lead to frauds he says: "If it be said that the
same opportunities [for corruption] now exist in refer-
ence to real estate of a corporation, the answer is plain.
The real estate is tangible, fixed, open, it can be seen,
and its value estimated by everybody. It can be com-
pared with the general adjoining real estate, and with
sales in the neighborhood. It has a market value, and
over- valuations or fraudulent ones can be detected."
Now this is exactly what the Ford Bill proposes to ac-
complish. For the purposes of taxation it extends the
attributes of real estate to all corporation privileges.
The market value test, to which Mr. Hill points as se-
curity against fraudulent assessment in the case of land,
will then be just as clear in the case of franchises.

420 GUNTON'S MAGAZINE [June

" Land," says Mr, Hill, " can be seen, and its value es-
timated by everybody .... It has a market
value." Has not corporation stock a " market value " ?
Is not this market value subjected to the test of actual
sales every day? If the market price of real estate is
the supreme test of its value, which cannot be tam-
pered with, then the market price of a corporation's
stock is equally so. The Ford Bill converts corpora-
tion franchises into the kind of property which Mr.
Hill himself declares is the very best for taxing pur-
poses.

" We do not object to the taxation of franchises,"
he continues, "but our objection is aimed at the par-
ticular method here proposed The pay-
ment of a fixed percentage of gross earnings would be
the most satisfactory system that could be devised."

This is really surprising from Mr. Hill, as an
avowed enemy to the income tax, and all inquisitorial
taxation. Any tax which necessitates rummaging
through the books of a concern or the pockets of a citi-
zen to find its resting place is inquisitorial and highly
objectionable, and, as Mr. Hill has more than once
pointed out, leads to perjury and all the immoral
motives that can accomplish evasion. Nothing except
personal incomes are quite so doubtful as objects of
taxation as profits and earnings. Whenever the value
of taxable property is to be ascertained by an affidavit
of the owner, the moral law is in danger. The sugges-
tion that a fixed percentage of the earnings should con-
stitute the tax on corporations is wholly unsound.
This would give the maximum opportunities for un-
due influence and inequality. It furnishes no rule
by which the assessors could be guided as to the rate
or amount of the tax. Whether it should be one per
cent, or five would be left entirely to the assessors. In
the hands of semi-populistic assessors the tax might be

1399- ] TAXATION OF CORPORATION FRANCHISES 421

put very high, or under the influence of machine politics
put very low. In converting franchises into real estate
this evil is obviated. The assessors will have no power
to discriminate as to the rate of the tax. It must be
the same on all the earning elements of the corporation,
which will introduce for the first time the element of
uniformity and equity into the method of taxation.

Mr. Hill is evidently more of a lawyer and politi-
cian than a student of economics. But while the ex-
governor showed little acquaintance with the principles
of scientific taxation, he made some very potent criti-
cisms on the details of the Ford Bill. He pointed out
what the framers of this measure had entirely over-
looked, if indeed they knew anything about it, that
there are already several taxes imposed on corporations
intended to make franchises contribute to the public
revenues. Last year nearly two and one-half million
dollars were paid into the state treasury from these
sources. He also called attention to the fact that with
these existing taxes the present bill would really
amount to double taxation, which is the very acme of
injustice.

But it will be observed that these are merely de-
tails. It shows that the Ford Bill was a little crude,
but all this can be remedied by the insertion of a single
clause repealing all existing taxes on corporations ex-
cept that on real estate.

That would simplify the whole matter for the
assessors and tax collectors, and for the corporations.
It would simply reduce the corporations' assets to one
general aggregate, the value of which is registered in
the open market value of the stock. Nothing Mr. Hill
said, or so far as we have observed that has been said
by any of the critics, tends in the least to impair the
validity of this principle of the bill.

Another objection made by Mr. Hill was that in

422 GUNTOJVS MAGAZINE [June,

some communities corporations have paid full compen-
sation for their franchises, while in others they have
received their franchises for nothing, and that it would
be obviously unfair to tax them both alike. One might
as well raise the same objection because some corpora-
tions pay a high price for their land while others get
land for nothing. If one corporation has paid too
heavily for its franchise or its land or its rolling stock
or its president, or'for anything else, its earning capac-
ity will be diminished by that amount, and this dimin-
ished earning capacity will reduce the value of the
stock. Consequently its taxes will be lessened exactly
in that proportion.

Mr. Hill further argues that ' ' The scheme propos-
ed by this bill will prove of no benefit to the people,"
for, he says, ' ' The assessed value of all corporate real
estate must then, as now, be deducted from the value
of personal property of corporations — to wit, their cap-
ital stock, surplus profits, or reserve funds, which con-
stitute their total assets, and the remainder therefore
constitutes the amount of the total assessable property."
If Mr. Hill really believes this why does he oppose the
bill ? If it would not benefit the people, of course it
would not hurt the corporations. If the corporations
really would not have to pay anything under this bill,
surely they might have saved all the fuss and flurry of
trying to defeat it. No such device could be effective,
however, if a short clause were inserted declaring the
principle of the bill and defining the way the assessors
shall arrive at the value of corporation assets; that is,
declaring that the difference between the value of the
tangible assets, plant, land, etc., and the total value of
the stock and bonds, shall be considered the value of the
franchise, no trouble would be experienced. With that
general rule, assessments would be uniform and just.

The real reform needed is simplification of the

1899-] TAX A TION OP CORPORA TION FRANCHISES 423

method of levying and collecting taxes, and this feature
is the real virtue of the so-called Ford Bill. It is a great
step in the right direction, and if a revision of our tax
system should occur once in five years with the definite
object of putting our entire state and local taxes on
this simple principle, we should soon reach the time
when double taxation would be unheard of, and tax
dodging unthought of.

If the special session of the legislature adopts the
suggestions of Mr. Hill, the governor would far better
sign the present bill, so that at least the principle it
contains shall become a part of our taxing system.
The defects of the bill should indeed be eliminated.
A clause should be added repealing the other corpora-
tion taxes. It should go into effect all over the state
at the same time. But if those who object to the bill
will not add these amendments without killing the
principle of the bill, then the governor ought to sign
it in its present shape, and let them take the conse-
quences of their opposition to the amendments. If
the law goes into operation it will at least introduce
into the taxing system of the Empire State a modicum
of sound principle, the operation of which may have a
wholesome educational effect on the public mind re-
garding the whole subject of taxation.

EDITORIAL CRUCIBLE

THE FACT that the Baldwin Locomotive Works has
received orders for locomotives from England, France
and some South American countries, and that the Car-
negie Company is sending steel rails to Japan and Rus-
sia, is being made the pretext for advocating abolition
of protective duties on iron and steel. These people
seem to forget that the mere fact that the Carnegie and
Baldwin establishments have reached a stage of effici-
ency where they are beginning to compete abroad does
not mean that the entire industry in this country is in
that condition. Indeed, for many years Carnegie has
not needed a tariff, but the great mass of the less
wealthy concerns in the business could not have con-
tinued without it. With some people free trade seems
to be the panacea for everything. If industries are de-
pressed the remedy is free trade. If industries are
prosperous, the cure for that also is free trade, — a theory
more important than prosperity.

CONSISTENTLY WITH the spirit which prompted the
czar to call a peace conference of the European powers,
comes the announcement that he has appointed a com-
mission to devise a new method of punishing political
offences, to be substituted for exile in chains to Siber-
ian mines. This is another sign that the czar is really
desirous of eliminating the harsh side of despotism from
the political system of Russia. Sending the most brill-
iant and energetic Russian citizens into chains to end
their days in the mines of Siberia under the most bar-
baric treatment, for political offences, has created con-
tempt for Russia in the eyes of the progressive world.
But in following up his call for the peace conference of
Europe by official measures to abolish the horrors of
Siberia, the czar has done much to entitle him to the

424

EDITORIAL CRUCIBLE

425

confidence and respect of civilization. It shows that
the yeast of progress has begun to work in Russia, and,
if the movement is not thwarted by rash acts of anar-
chists, Russia will ere long be on the road to constitu-
tional government.

GOVERNOR ROOSEVELT has passed through a trying
ordeal. In championing the bill for taxing corporation
franchises he placed himself nearly midway between
two political forces. On the one side was the pop-
ular demand for the bill, and on the other the intense
opposition of the corporations and the party organiza-
tion managers. He has shown capacity to listen, and
also a determination to insist upon maintaining the
principle of the measure, which is, for the purposes of
taxation, to treat franchises and other such privileges
as real estate. In taking this stand he has really made
a fight for sound principle in taxation. In refraining
from signing the bill, and calling an extra session of
the legislature to make amendments as to the methods
of applying and enforcing the law, the governor
showed a willingness to modify. In the treatment of
the opposition he was exceptional, and in standing im-
movably for the vital principle of the bill he was scarcely
less so. Although the new measure fails to lay down
a rule of assessment, it does at least incorporate into law
a sound and equitable principle of taxation, and es-
tablishes the precedent that a governor may have pos-
itive views on public policy not shared in by party
leaders, to the advantage of the state. In this, it is no
doubtful prophecy to say, he will be thoroughly sus-
tained by the people. To insure the full fruits of the
law, however, it should have provided that the value
of the franchise be determined through the joint
value of the stock and bonds.

426 GUNTOWS MAGAZINE [June,

IN THE American Journal of Sociology for May, Mr.
Thomas G. Shearman, on whom the mantle of Henry
George seems to have fallen, states the doctrine of the
single tax in three sentences, thus:

"Tax nothing made by man. Tax everything not made by man.
Collect all public revenue out of and in exact proportion to the revenue
which some men collect from other men for permission to use that
which no man made."

If we tax nothing made by man, then we shall tax
practically nothing that has any value. In the last
analysis, the value of everything in this world is trace-
able directly or indirectly to the application of human
effort. Strictly speaking, all value is created by man,
hence nothing that has value would be taxed. "Tax
-everything not made by man." All right; tax the sun,
moon and stars. Man never was suspected of making
these, and, like them, almost everything not made or
modified by man has no value for taxing purposes.
On Mr. Shearman's plan there is a good deal which
would be subject to his single tax, but very little of it
would yield any revenue. If the last sentence means
anything it means to levy a tax equal to the rent, which
is simple confiscation of rent. This is a departure
from the position taken in his book, reviewed in this
number; he there repudiates the Henry George idea of
making the amount of rent the measure of the tax, but
asserts that the tax should be levied for revenue and
not for the purpose of taking the rent; which is the
most rational proposition in his book. But he seems to
have slipped back to the original George idea of confis-
cation.

THE ADMINISTRATION took advantage of the visit of
the Aguinaldo commissioners to Manila to announce the
policy to be inaugurated in the Philippines after peace
is established. It is as follows:

(i) A governor-general to be appointed by the

•I899-] EDITORIAL CRUCIBLE 427

president. (2) A cabinet to be appointed by the gover-
nor-general. (3) All judges to be appointed by the
president. (4) The heads of departments and judges
to be either Americans or Filipinos or both. (5) An
advisory general council to be chosen by the people by
a form of suffrage hereafter to be determined.

The Filipinos are apparently to have no voice what-
ever in the government. TheJ nearest they come to it
is in being permitted to elect an advisory board which
has absolutely no power. This comes pretty near being
a despotism. The czar cannot get along without his
governors-general and heads of departments. It
would seem that some representative feature ought to
have been introduced, else how can evolution of self-
government ever be expected to come ? The appointment
by the president of a governor-general who shall in
turn appoint a cabinet, and the appointment of judges
by the president, all are well enough and even neces-
sary, but it would seem as if the Filipinos ought to be
admitted to something more than a mere advisory coun-
cil without power. No form of government should be
established by the United States anywhere without
having some representation of the people in it. People
who are capable of taking no part whatever in govern-
ment are too low to enter our political system.

IN REPLY to our criticism of its discussion of the ef-
fect of the tariff on the price of wool, the Boston Herald
.says: —

' * This is all very well as a theoretical statement,
but we would remind our contemporary that there is
no fixed price of production for wool. It may cost no
more to produce wool in Montana than it does in Aus-
tralia, or in Texas than it does in South Africa."

Of course there is no fixed cost of producing wool,
any more than of newspapers or a thousand other ar-

428 GUNTOWS MAGAZINE [June,

tides; but there is a practically uniform price at which,
under competition, they sell in any common market,
and that price, as we have often explained, approxi-
mates very closely to the cost of producing the most
expensive portion continuously supplied. It is the dif-
ference between the market price of wool as thus de-
termined, in London and New York, that the tariff
affects. It is hardly possible that the Herald imagines
that wool is any different in this respect from other
commodities. What we said regarding the proportion
of the tariff being added to the price is exactly as true
of anything else under the conditions named as it is of
wool.

But the Herald reminds us that this is not ' ' what
was aimed at by Judge Lawrence and his friends when
they forced the present wool duty down the throats of
eastern manufacturers." We are not and never have
been concerned about what Judge Lawrence and his
friends aimed at, but only with what is the economic
working of a protective tariff, and this is what we sup-
posed the Herald was interested in. The special point
we tried to impress upon the Herald and upon those
who reason from its standpoint is that the dogma that
the full amount of the duty is added to the price is
entirely erroneous, and all discussions of the subject
based upon that assumption are unreliable, and the
facts given by the Herald in relation to wool prove
that we are correct.

THERE is NO calling in the community which gives
a person a greater opportunity for usefulness than the
Christian ministry. But when a minister talks without
thinking, or thinks without data, he may become a
most efficient instrument for evil. According to a re-
port in the Boston Herald of his recent sermon, the Rev.
Hiram Vrooman is a case in point. It is often easier to

i89Q.] EDITORIAL CRUCIBLE 429

reason from feelings than from facts — they are more
readily obtained, — but in a public teacher, especially a
preacher, it is less creditable. After quoting some
large figures regarding trust organization, and compar-
ing trusts in the United States to Aguinaldo in the
Philippines, the reverend gentleman said:

" The trust is by inherent nature a business despotism — an eco-
nomic tyranny. Political democracy and economic despotism cannot
abide together in the same country at the same time. They are mor-
tal enemies, and one of the two is certain to destroy the other. No free
republic can exist where the trust controls the production and distribu-
tion of wealth ; the republic will yield to the despotism of the trust, or
the trust will bend to the democracy of the republic. This is in-
evitable."

This statement shows a misconception of the whole
trend of industrial history. To say * * The trust is by
inherent nature a business despotism — an economic tyr-
anny " is simply to talk loud and use adjectives. They
are by nature simply large economic enterprises, which
are making wealth cheaper, employment more perma-
nent, and poverty less general and severe throughout
the community. Unfortunately they have some short-
sighted and headstrong leaders, and so has the church,
as this sermon shows. If, either through fanaticism in
the church or demagogy in politics, the movement of
economic re-organization should be suppressed and a re-
turn to small individual concerns compelled, the best
results of modern invention would be destroyed. The
greatest economy of production, no matter how much
concentrated, which makes' wealth more abundant and
cheap and makes profits depend upon larger consumption
of products by the masses', is the surest guarantee of
" political democracy." To call this "business despot-
ism" or "economic tyranny" is ignorantly to give a
bad name to a good thing. Whatever makes wealth
cheap and man dear helps progress, pessimistic preach-
ing to the contrary notwithstanding.

Civics AND EDUCATION

CITY ADVANTAGES IN EDUCATION

Cities, like trusts, keep on growing and multiply-
ing apace, oblivious of the army of Mrs. Partingtons.
who are always striving to sweep back the tide. As
year after year and decade after decade come and go,
the tendency impresses itself as so uniform, so steady,
so irresistible, that even the Mrs. Partingtons one by
one tire of their task and carry their brooms back to the
more useful, if less heroic, labor of housecleaning.

There are several stages of opposition to every
such great economic or social tendency. First it arouses
merely a wondering interest, then alarm, then violent
opposition and spasmodic efforts to stop and turn it
back; then comes resignation to the inevitable, and fin-
ally th*e surprised discovery that it is after all a natural
movement, wiser than its enemies, and is working out
larger benefits to the race than could possibly have
been brought about by any arbitrary reconstruction of
society on the lines of this or that imaginary Utopia.

The cities have persistently grown despite protests
and warnings, yet not because the city itself is a vicious
something, working for the harm of society; it merely
represents the result of a great natural movement of
society itself. Nowhere has the growth been so rapid
and the results so huge as in the United States. Two
years ago there were 578 cities in this country, of up-
wards of 8,000 population, whereas in the opening year
of the century there were but six. Moreover, these 578
cities (according to school census estimates) contained
22,531,091 human beings, or 31 ^ Per cent- of the total
population, while the six cities of 1800 could boast only
a paltry 210,873, or 3-97 Per cent, of the entire popula-
tion at that time. Even since 1890 the city growth has

430

CITY AD VANTAGES IN ED UCA TION 431

been most pronounced. During the six years after
1890, 1 30 additional communities rose above the 8,000
population mark, and the total population living in cities,
of 8,000 or more in the United States increased by
4,246,706.

Whatever our views of the matter, this is a move-
ment that is certain to go on, perhaps for an almost in-
definite period. Not that rural population will actually
diminish, but in the nature of things rural industries will
demand only comparatively slow increase of population,
especially as agriculture makes larger and larger use of
machinery. The bulk of the world's increase in popula-
tion will continuously be absorbed in the enlarging and
multiplying occupations of the city. The basis of the city
is the great economic and social fact that practically all
future expansion in the world's consumption of wealth
must be in the line of manufactured products. This,
means not only a larger variety of industries but many
more distinct processes in converting raw materials inta
new forms of commodities designed to satisfy new
ranges of tastes and demands. Such industries are
essentially urban in their character.

Cities will grow in size because it is becoming more
and more necessary that industry be conducted on a
large scale, requiring large factories and large groups.
of employees. Cities will multiply in number, also>
because economy more and more demands that indus-
tries be located nearer the sources of raw material sup-
plies. To this fact is due the rise of most of the manu-
facturing towns in the Central West, and more recently
in the South. Cities are bound to multiply in those
regions and elsewhere as this feature of economical pro-
duction becomes more and more important.

There is some reason to believe, too, that urban
life will some time become a feature even of agricul-
tural industry, particularly with the development of

432 GUNTON'S MAGAZINE [June,

cheap electric transit. This may be far in the future,
but in the light of the extraordinary development in
cities during the last few years it is by no means vision-
ary to imagine a time when isolated farm life will be a
thing of the past. Farmers, some day, will be able
voluntarily to locate in town centers and go out to their
fields, just as thousands of city workers now live in sub-
urban localities and go in to town every day to follow
their various tasks.

Our present purpose, however, is not to talk about
the general features of this movement, but to show
some of the superior possibilities it affords in the mat-
ter of education of the young. We say possibilities, be-
cause it is unfortunately true that the standard of civic
spirit in this country has not yet reached a point high
enough to provide the full educational opportunities
rightfully to be expected from large population and
great wealth, grouped together. Indeed, it is possible
that in proportion to capacity or ability in this respect,
many of our large cities are doing even less for educa-
tion than the rural districts.

It is hardly necessary to speak of the broad general
advantages a large city school possesses in respect to
organization, discipline, systematic grading of work,
and scientific use of the best methods of instruction.
These are perfectly well known and admitted by every-
body. It is of more interest just now to see how the
city and rural schools in the United States compare, in
the matter of enrollment, teachers and their salaries, at-
tendance, amount of schooling per year, expenditures
for school purposes, and the provision of extra features
such as kindergartens, evening schools and high
schools.

Under the first head — enrollment — the country
seems to make a better relative showing than the city.
Of the total number of school children in cities of 8,000

1899.] CITY AD VANTAGES IN ED UCA TION 433

inhabitants and upwards, 60.93 Per cent, are enrolled
in the public schools, and of the school children outside
of such cities, 73.33 per cent, are enrolled. If we add
the private and parochial school enrollment, however,
the city showing is raised to 75 per cent. We have no
statistics for private and parochial schools in the coun-
try and small towns, but the number in such institu-
tions there is of course comparatively small, and prob-
ably would not increase the total country enrollment to
more than 75 or 76 per cent.

The proportion of children enrolled in the country
districts is kept down by circumstances very difficult to
reach by law, such as distance from school, and employ-
ment by parents in home and farm work. In the cities
it is much more feasible to enforce school-attendance
laws, and the fact that city enrollment is no larger than
country shows laxity and evasion, unmistakably. The
temptation to set children at work in factories and
stores is very very strong, and either our laws on this
subject are not rigid enough, or their enforcement is
neglected, and false age certificates accepted with little
or no questioning or investigation. It is no excuse to
say that the city enrollment is "up to the average." In
the nature of the case it should be considerably above
the average ; otherwise the city is not doing so well
proportionately as the country.

But registration figures, while they show the num-
ber of children reached, do not indicate the amount of
•schooling received by each child. Here the advantage
is decidedly with the city.. The average length of the
school term in cities of 8,000 population and up wards is
188.9 days (nearly nine and one-half months); outside
of such cities, it is only 122.8 days (about six months
and three days).

Turning to the matter of teachers, it would seem
again, at first sight, as if the figures were more favor-

434 GUNTON'S MAGAZINE [June.

able to the country schools. In the city schools there is one
teacher to every 48 pupils, while in those outside there
is one teacher to every 34 pupils. These figures, how-
ever, do not by any means represent the true condition
of affairs. The apparently high proportion of teachers
to scholars in the country schools is chiefly due to the
large number of very small rural schools, where, by
reason of the very sparseness of the population, there
are not enough school children even to make ordinarily
good systematic work possible, while in the larger vil-
lage schools classes are frequently altogether too large.
Thus, the figures for the country schools really represent,
to a large extent, two undesirable extremes. On the other
hand, the proportion of 48 pupils to one teacher in the
city schools is much more nearly a correct reflection of
the actual conditions, which are undoubtedly more fav-
orable to effective work than where either very small or
very large classes exist.

When we look into the question of expenditures for
school purposes, and the salaries of the teachers, the
superiority of city possibilities in education is very
marked. The annual expenditures per capita for all
public school purposes in cities of 8,000 population and
upwards is $3.77; outside of such cities, $2.10. The
contrast is even more strongly marked in the dis-
tinctly rural portions of the country. For instance, in.
the rural districts of the South Atlantic states the annual
expenditure is only 93 cents per capita, and in the South
Central states 91 cent, per capita. In the cities in these
two sections it is respectively $2.42 and $1.93 per capita.
It is a remarkable and interesting fact that the cities of
Montana head the list with a per capita expenditure of
$6.85. The cities of Massachusetts come next with
$5.06, and New York is third with $4.75. Alabama is
at the foot of the list, with 96 cents per capita in the
cities and 32 in the country districts. North and South
Carolina and Florida are but little better.

1899.] CITY AD VANTAGES IN ED UCA TION 435

The average monthly salaries of teachers and sup-
ervisors in cities of 8,000 population and upwards in the
United States is $66. 1 9 ; outside of such cities it is $35.31.
Despite the fact that city salaries are almost double
those paid in the rural schools, only 57.47 percent, of the
total expenses of city schools is devoted to teaching and
supervising, as against 68.84 Per cent, in the rural
schools. The meaning of this is very plain, and is
simply that in the cities a much larger proportion of a
much larger per capita expenditure goes to provide
superior educational facilities, in school houses, ma-
terials, etc., and this not at the expense of teachers'
salaries but in addition to a city salary rate double that
in the country. One can gather some idea of what the
facilities in school buildings and supplies must be in
certain rural sections of the country from the fact that
in Georgia, even with the abnormally low salaries, nearly
91 per cent, of the total school expenditures outside of
the cities is required for teaching and supervising, and
almost 97 per cent, in Alabama, 88 per cent, in South
Carolina; 87 in North Carolina, 89 per cent, in Missis-
sippi, 87 per cent, in Texas, 87 per cent, in Arkansas,
85 per cent, in Kentucky.

Teachers' salaries are highest in the cities of Cali-
fornia, where the average monthly pay of teachers and
supervisors in cities of 8,000 and upwards is $89. 98, and
outside the cities $62.21. Wyoming comes next with
$83.29 in the cities and $76.15 in the rural districts.
The next highest state in the matter of salaries is (for
cities) Colorado, $82.04; next Montana, $81.46; next
the District of Columbia, $76.00; next Illinois, $74.95;
next Massachusetts, $70.90; next New York, $70.74;
and next Oregon, $70.35. In these latter states the
salaries paid outside of the cities are little more than
half the city rates; indeed, in New York state the
salaries in rural schools average only $26. 1 8 per month,

436 GUNTON'S MAGAZINE [June,

which is little better than in the rural schools of Mis-
sissippi. Even Louisiana pays $32.64.

If it were not for the fact that the proportion of
women teachers is very much larger in the East than
in the West, the Massachusetts salary showing would
lead the whole country, — which is very much as we
should expect. The salaries of male teachers and
supervisors in that state average $144.80 per month,
and of women $52.20.

With reference to extra educational opportunities,
such as high schools, evening schools and kindergar-
tens, the cities of course are very far in the lead. It is
in the nature of the case that evening schools do not
exist in rural districts where the industrial conditions
do not make them necessary. High schools and
kindergartens, however, are among the distinct and
peculiar advantages that the city has to offer in educa-
tion. There are a great many high schools in large
towns whose population falls just below the 8,000 mark;
but, of the total of scholars enrolled outside of the cities,
only 2.6 per cent, are high school pupils, as compared
with 5.5 per cent, in the cities. In our Atlantic and
North Central states, where cities are most numerous,
there are 229 and 256 high schools respectively; in
the South Atlantic and South Central states, conspicu-
ously rural regions, only forty- two and sixty-four re-
spectively. The total number .of high school pupils in
the two northern sections is nearly 150,000 and in the
two southern sections about 19,000.

No comparisons are possible in the matter of even-
ing schools, but it is worth mentioning that the cities
of 8,000 population and over in the United States have
813 such schools, with 183,168 pupils. The great ma-
jority of these are in the North Atlantic states — 558
schools and 140,053 pupils.

The statistics of public kindergartens are very in-

I899-] CITY AD VANTAGES IN ED UCA TION 437

teresting. Only within recent years has this movement
really begun to take hold. It is one of the most en-
couraging features of our educational progress, because
there is a sense in which the kindergarten is an even
more powerful factor of social progress than any other
branch of the educational system. It is said that Su-
perintendent Andrews, of the Chicago schools, has de-
clared that he would be willing to give up the high
school system of that city rather than abandon the pub-
lic kindergartens ; if that is his position he is absolutely
in the right of the matter, and is the sort of educator
whose influence in that line cannot be too widespread.

The kindergarten is peculiarly a city or town insti-
tution. In the cities of 8,000 and over in the United
States there were, in 1896-97, 1,077 kindergartens con-
ducted in connection with the public schools. These
employed 2,024 teachers and registered 81,916 pupils.
In cities and villages of between 4,000 and 8,000 popula-
tion there were 80 public kindergartens, with 139
teachers and 4,717 pupils. In 1890-91 there were less
than 460 public kindergartens reported for the whole
country.

Philadelphia has the largest number of public
kindergartens of any city in the United States, although
not the largest number of pupils and teachers. There
are in Philadelphia 122 such kindergartens, with 6,225
pupils and 163 teachers, an average of 38 children to
each kindergartner. St. Louis comes next, with 100
kindergartens, 281 teachers and 9,154 children, an aver-
age of 32 children to each kindergartner. The third in
rank is Boston, with 64 kindergartens, 125 teachers and
38 pupils to each kindergartner. Next is Chicago, with
53 public kindergartens, 108 teachers and 43 pupils to
each kindergartner. Milwaukee has 40 public kinder-
gartens, 6,358 pupils, but only 78 teachers, — an aver-
age of 8 1 pupils to each teacher, which is an absurd

438 GUNTON'S MAGAZINE [June,

proportion. Probably there is some voluntary assist-
ance, but, so far as the city's efforts are concerned, it
would seem as if Milwaukee intended her kindergartens
to be public nurseries for the amusement of as many
children as can be crowded into them, rather than seri-
ous attempts to apply the principles of Froebel to child
training.

After Milwaukee comes Los Angeles, California,
with 32 kindergartens, 71 teachers and 33 pupils to
each kindergartner. Next is St. Paul, 27 public kinder-
gartens, 52 teachers and 43 pupils to each teacher.
New York has the undesirable distinction of holding
only eighth place, with 22 public kindergartens and 25
teachers; but the average number of pupils per teacher
is much more favorable to good work than in any of the
other cities, being only 23. This poor showing for
New York, however, reflects the unprogressive charac-
ter of the city government rather than the spirit of the
very large better class of the population. This is shown
by the fact that the importance of kindergartens has
been so strongly appreciated that a private association
has maintained a number of them for several years
past, by voluntary contributions; until at last the sen-
timent in their favor has become so strong that even
the city has been compelled to embody the work in the
general public school system. The movement may be
expected to grow with great rapidity from now on; in
fact, during the last year or so a number of new kinder-
gartens have been started in the New York public
schools.

Public kindergartens in Philadelphia, St. Louis and
Boston were established before 1890; in Chicago since
that year: the exact dates for the other cities mentioned
are: Milwaukee, 1886; Los Angeles, 1890; St. Paul,
1892; New York (at first only two in private institu-
tions but supported by public funds) 1886.

1899. ] CITY ADVANTAGES IN EDUCATION 439

Anniston, Alabama, holds the record for heroic
treatment of the kindergarten problem. There is in
that city one public kindergarten, one teacher, and 122
pupils! The teacher may have some assistance, but if
so it is voluntary, or supplied by student kindergartners,
and not due to any prodigal generosity on the part of
Anniston.

That kindergartner should have a monument and
it should be erected at once, while she yet lives and
labors. When the time comes for an inscription, if it
be no more than "She hath done what she could," it
will be high and ample praise; — indeed, the highest
praise possible to any teacher under similar circum-
stances. Presumably this kindergarten was introduced
as a doubtful experiment, upon which it would be im-
possible to spend too little money; and perhaps the
future expansion of the system in that neighborhood is
to depend largely on the success of this teacher in re-
working the miracle of feeding the five thousand.

There is one other kindergarten in Alabama,
however, in the village of Bessemer. The teacher
there has only seventy-five pupils, which is even better
than Milwaukee, and luxury compared with Anniston ;
doubtless she commands a proportionately low salary
in order that the public may get its money's worth.

As we have said, while the cities offer the greatest
opportunities, show the greatest progress, and afford
the largest proportionate amount of high-class educa-
tional work, they have not completely fulfilled the
obligation that their vastly superior ability imposes.
This is particularly true of the metropolis. Propor-
tionately to its size and wealth, it is at the foot in
respect both to public kindergartens and high schools,
while hardly anywhere else can it be said that ordinary
grammar grade pupils are ever turned away for lack of
accommodations. The general forward movement is

440 GUNTON'S MAGAZINE

too strong, however, to be held back by reactionary
forces anywhere. It is of immense importance that
New York should be in the front rank in liberal and
progressive popular education, because of its exceptional
opportunities for exerting widespread influence. At
present the standard of fulfillment of municipal duty in
this respect is being set by other and younger cities,,
which at least shows that the cityward movement to-day
is producing more sound and hopeful results than
formerly. It is more difficult to reform an old con-
servative mass than to start right with a small new
group; that is why New York lags behind. Not until
the metropolis develops civic self-consciousness, and the
sense of pride strong enough to produce determination,
will it outgrow the need of goading and boldly step inta
line with the pioneers. Even if the standard of actual
leadership in each successive period is raised in newer
and smaller centers, New York should at least not fall
below the high general average of what the coming
city is to do for each coming generation.

CIVIC AND EDUCATIONAL NOTES

Here is an amusing incident, — suggestive, too, —

reported in the columns of the Charities Review. A

A Slum Brooklyn school teacher sent a little Italian

Experience £irl nome> "with the order to have her

mother wash her until she was clean.

" The child returned shortly afterwards, accom-
panied by its enraged mother, who said some things not
really polite toj the teacher, finishing with, * She is
washed now, anyway.'

' ' The onlyj visible evidence of a bath was a clean
spot around the little one's mouth and nose. The
teacher told the mother that she had meant that the
child should be thoroughly bathed. ' She should be
put into a tub and washed,' she explained.

" ' What! in a tub ?' the woman exclaimed. ' Why,
that would kill her! And, besides, she's sewed up for
the winter. ' '

It may not be a " sample case," but we strongly
suspect it is. There might be some hope of arguing a
few such parents out of the " sewing-up " custom, but
when for each convert to cleanliness half a dozen new
sets of inaccessible and unwashable infants are brought
into the country, we are a little worse off than the back-
sliding toad in the well. It is said that the American
common school system is a cast-iron stomach, capable of
digesting anything that is put- into it, — but this is a de-
lusion. There is a limit to any stomach's capacity for
embalmed food.

What certain Scotch and English cities have been
attempting in the way of municipal tenements and
More lodging houses, private capital is supply-

Model ing in American cities as fast as the eco-

Tenements nOmic possibilities of that line of invest-
ment warrant it. The two Mills Hotels, in New York,

441

442 GUNTON'S MAGAZINE

have been in operation long enough now to prove that
sanitary, commodious, and almost elegant lodgings,
with all modern conveniences, and wholesome meals,
can be furnished profitably at very low rates. Mr.
Ogden Mills, son of the builder of the Mills Hotels,
and Mr. Ernest Flagg, the architect, have just bought
twenty-two city lots, at Tenth avenue and Forty-second
street, on which they will erect eleven model, fireproof
tenements, constructed almost exclusively of metal and
stone. Each tenement will be square, six stories high,
and accommodate 450 families. In the center will be
a large courtyard, so that all the rooms will have
plenty of light and air. There will be no dark halls;
all apartments will connect directly with the stairways.
The average rental per room will be $1.00 per week,
and at this rate the investment will yield about 3 per
cent, profit. The Charities Review comments very
wisely on this undertaking:

1 « Nothing is said in this plan about philanthropic
motives, and no appeals are necessary to secure the
funds. The investors are interested in seeing the poor
well housed, but their investment is not for charity.
When we stop urging the charitable features of a num-
ber of things, in which philanthropic people may be
interested, and present them as business propositions,
the chances of social progress will be increased. Phil-
anthropy is a strong motive force, but the prospect of
sound business investment is stronger. And, indeed,
there is no philanthropy more commendable than that
which adequately meets for a fair compensation a recog-
nized need of the community, whether that need be of
sanatory homes, of pure foods, or of transportation
facilities. The community, that is, the masses, is able
to pay the man who does it a needed service."

This applies, by the way, to municipal paternalism
quite as forcefully as to private philanthropy.

SCIENCE AND INDUSTRY

POWERS AND PERILS OF THE NEW TRUSTS

Ten or a dozen years have now elapsed since the
trust movement in this country began to assume really
formidable proportions; yet the material conditions of
the people gradually improve, and the republic still en-
dures. Probably no great natural movement or ten-
dency in the world's history ever brought out such uni-
versal protests and dire prophecies of disaster as this
modern tendency of capitalistic combination. It has
been declaimed against, preached against, flayed in the
press, denounced in all political platforms, and attacked
by professors of political economy with all their re-
sources of scholarly exposition, showing the industrial
despotism and thraldom of the masses that was sure to
come, and uttering solemn warnings. " Combinations
in restraint of trade " have been outlawed by nearly
every state in the Union, and even by national legisla-
tion as far as it could be made to apply to the subject.
Yet the trusts march on, and the laws step one side,
because in not one case out of a hundred is it possible to
show that they are combinations " in restraint of trade; "
until, it is estimated, about four billion dollars of the
capital invested in productive industry in this country
has now come under some form of trust organization,
and more than one and one-half billions of this during
the last five months.

Is it not a little strange that, in spite of all this,
the long promised cataclysm has not yet arrived, — in
fact, seems farther off than ever? Was there ever any-
thing so remarkable in the world's industrial history as
this tremendous, silent revolution that has been going
on right under our eyes, yet so smoothly and naturally
as to create hardly a ripple of disturbance in the great

443

444 GUN TON'S MAGAZINE [June,

economic round of daily production and consumption?
The average man would hardly have had cause to sus-
pect what was taking place, but for the deluge of news-
paper warnings. True, as the consolidation went on
some factories, generally the poorer ones, were closed
down, but that had happened over and over again in
the natural course of free competition. Again, em-
ployees were discharged in many instances, but that too
was no novelty. It had always occurred whenever a
concern failed or a plant suspended operations because
of inability to keep in the race. The laborers under
such circumstances have always had to seek employ-
ment in other establishments; some of them, perhaps,
remaining in idleness until the growth of business cre-
ated new demands for labor. Hard as it is, there has
been relatively no more difficulty about this re-adjust-
ing process in recent years than formerly; in fact, at
present the percentage of non-employment is very
small indeed, and the question is chiefly one of finding
the right sort of men for the different kinds of work to
be done. As to ruin of small competitors, it has actually
been a great cause of complaint against many recent
trusts that they have taken in and saved groups of old
and poor concerns that would shortly have gone to the
wall anyway, making the productive part of the trust
carry the burden of these unprofitable plants.

Neither in respect to small industries or their em-
ployees, therefore, have the trusts brought any new
and unusual hardships. From the community's stand-
point, it is notable that during the past year the growth
of trusts and revival of business prosperity have come
along hand in hand. Whether there be any connection
between the two or not, it is clear that the one has in
no way had the effect of preventing or destroying the
other.

This has become so conspicuous, staring everybody

•1899- ] PO WERS AND PERILS OF THE NE W TR USTS 445

in the face, that public sentiment in many quarters is
changing towards the whole problem. Old standard
newspapers, the very ones that have persistently at-
tacked the trust movement for years, are coming to dis-
cuss the matter in a markedly different spirit. Lec-
turers on the subject need not quite exhaust the diction-
ary of vituperation in order to get a hearing. Still,
opposition has by no means died out. No political
party as yet dares descend to mildness even, in its refer-
ences to trusts. " Down with them!" is to be the chief
rallying cry next year of one of the great political
parties at least, and the other will meet this by trying
to show that it (the party) has done more to stamp out
trusts than has its opponent. Each party must be
a St. George to some dragon, and what more conven-
ient dragon is at hand than the trust? What would a
political speech amount to without some hideous op-
pressor writhing on the rack, and the orator turning
the screw?

But the opposition is not all mere "ranting," by
any means. There is a well defined feeling among a
large group of people not usually moved by mere pre-
judice, that we are rapidly drifting into a condition ex-
tremely perilous to industrial and political freedom and
progress, even though these results are not yet manifest.
They ask, in alarm, whether we shall not soon reach
a point where, all competition being killed, the trusts
will throw off all restraint and manipulate prices,
wages and legislation precisely to suit themselves.
They seem to see every avenue of individual effort
closed, especially to men of small means, and the whole
community reduced to the status of wage earners who
will have no choice between serving the trusts and facing
starvation. They are possessed of a dread that the out-
come of all this will be one universal trust, controlling
and disposing of everything like a mediaeval despotism.

446 GUNTON'S MAGAZINE [June,

These are the powers commonly supposed to lie in
the hands of the trusts, or that will lie in their hands
absolutely if the movement continues much longer.

Now let us see what ground, if any, there is for all
this alarm. Are the trusts all-powerful, or likely to
become so ? Before we can answer this we need, first
of all, to find the source of what power they do possess.
It is not in any arbitrary ability permanently to raise
prices, reduce wages, and control the output. Many
foolish attempts have been made to do exactly these
things, and, except where there was some real economic
justification for the step taken, they have disastrously
failed. Several wheat "corners," the whiskey trust,
copper trust, cordage trust, the nail and other at-
tempted combinations in different branches of the steel
industry, are examples of what comes of economic
folly. Now, when these experiences are contrasted
with the steady and permanent success of trusts which
have adopted the opposite policy of permanent eco-
nomic improvements, reduction of prices, and fair deal-
ing with employees, it furnishes a very powerful ob-
ject lesson to new trusts. Some, of course, have not
profited by it yet, but they will encounter the penalties
of their predecessors until they do.

It is not surprising that this should be so. A
mere trade agreement between a group of concerns
does not and cannot abolish competition. "Corners"
cannot succeed. They must go on buying up every new
competitor that appears in the field, but this cannot
continue very long without completely destroying the
profitableness of the business. It was this, chiefly, that
brought about the collapse of the "corners" just
enumerated.

The threat of new outside competition is more con-
stant and powerful to-day than ever before. No trust
organization can safely ignore it. One of the chief

1899.] PO WERS AND PERILS Of THE NEW TRUSTS 447

reasons why it is becoming so important a factor is the
rapid growth of our surplus capital. Industry has been
so profitable in this country that we have gradually
accumulated a great fund of surplus, and, instead of
trying to borrow money abroad, our capitalists are
actually seeking opportunities to place foreign loans.
Interest rates have steadily declined. Railroad after
railroad has been going through financial re-organiza-
tion, refunding its bonded indebtedness at from one to
three per cent, lower rates than were previously paid.
Capital, instead of being difficult to obtain, is eagerly
watching every opportunity for profitable investment.
This means that nobody can have any absolute control
over prices. A new method or invention in productive
processes, if obtained by some actual or possible rival,
is likely to undermine a trust at almost any time. Their
only safety lies in maintaining the lead in introducing
every possible improvement and economy, and thereby
keeping the price on a steadily downward movement
which competitors cannot follow.

A mistaken policy on the part of a vast industrial
concern is a far more serious matter than the common
daily errors in the conduct of a small business. That
it is a very serious matter to maintain the constant su-
premacy of these immense concerns is shown by the
necessity they are under of securing as officers and man-
agers men of the greatest energy and ability that money
can find. Indeed, it is pure folly to imagine that great
power can exist without great responsibility, or can
increase without making discretion and just conduct more
and more essential. The great rough balance that
exists everywhere in nature and keeps it right side up
and in stable equilibrium operates also in economics,
and prevents any permanent, one-sided monopoly of
power and privilege.

The situation to-day in this trust matter shows how

445 GUNTON'S MAGAZINE [June,

true this is. We have been so impressed by the enor-
mous growth of the trusts themselves as almost to over-
look a fact of equal importance, — that competition also
has been growing more and more keen, even though it
is fighting now with larger weapons, and not with a mul-
titude of staves and spears as under the system of small
individual industry. The Standard Oil Company, per-
haps, comes as near being an industrial monopoly as
any concern in this country, yet it has either never
cared to or been able to obtain control of some twenty-
five or thirty independent refining companies, more
than fifteen of which have from $100,000 to $1,000,000
capital and are quoted in the standard commercial rate
books as establishments of good credit. Should this
company, through some strange freak of management,
reverse its established policy and try to restore the oil
prices of several years ago, there is no doubt but that
capital would be put into many of these outside plants,
and into new oil fields, and powerful competing indus-
tries built up. The Standard maintains its position
only by keeping prices at a point so low that only a few
well situated outsiders can compete.

The sugar trust for several years after its forma-
tion had practically no competition. Now, however,
for a year or more a fierce fight has been in progress
between the sugar trust and the Arbuckles, which
seems no nearer conclusion than ever. But, it is stated
on quite definite official authority, that if at any time
these competitors should combine there are at least two
new syndicates ready and waiting to enter the field, one
operating in Maryland and the other in New York. It
is even more difficult to monopolize this business than
the refining of petroleum. The one fact of the rapid
growth of free capital seeking investment is a force
tending to keep all such industries at the point of great-
est efficiency and lowest prices, infinitely more power-

1899. J PO WERS AND PERILS OF THE NE W TR USTS 449

ful than all the legislation that could be devised for that
purpose.

Much the same situation is developing in the case
of paper manufacture. About seventy-five or eighty
per cent, of the producing capacity of the country was
brought into the recently organized paper trust, but
there is already vigorous competition outside, and pros-
pect of rapid growth of new independent concerns. The
New York Journal of Commerce and Commercial Bulletin,
a pronounced anti-trust paper, is authority for this in-
formation. According to the Shoe and Leather Re-
porter precisely the same condition exists with refer-
ence to the leather and rubber goods trusts. "There
are a number of outside companies," it says, " who are
holding their own and maintaining a high standing in
the trade."

Even in lines of business that seem to be in their
nature as nearly monopolistic as it is possible to be,
there has recently been an unprecedented amount of
competition. The severe fight among the gas companies
in New York city has brought about a reduction, by
some of the companies, to 65 cents per thousand feet,
and by others to 50 cents, while the uniform price
before was $1.10. It is not probable that this state of
affairs will continue long, because the price quoted is
probably just about at the cost point of production. A
consolidation may be effected and a somewhat higher
uniform rate established, but it is safe to predict that
never again will the former price be reached. If it
gets above 85 or 90 cents, there is really nothing to
prevent the entrance of still other competitors, as in the
present case, anxious to share the profits at that rate.
This has not been confined to New York. Other cities
have recently secured considerable reduction in gas
rates, and still others are considering propositions from
competing companies to furnish gas much cheaper than
at present.

450 GUNTON'S MAGAZINE [June,

This is also true in the case of street railway trans-
portation. The steady tendency is to give us better cars,
faster time, and cheaper service through the increased
mileage covered by a five cent fare, and extension of
transfer arrangements. In New York this movement,
has been so extensive lately that the suburban move-
ment is really taking on enormous proportions. Com-
petition between the elevated and surface lines, added
the pressure of the public demand, has, within the last
few months, produced most important results. The
elevated railway is to change its motive power to elec-
tricity, equip its line with new cars and establish ex-
press train service. The Metropolitan is continually ex-
tending the area of transfers, and now the Third Avenue
road has arranged a transfer system with the Manhattan
Elevated, and also with the Union trolley lines in the
Bronx Borough, so that it is possible to go from the City
Hall to New Rochelle on Long Island Sound for eight
cents. In Brooklyn, which is the competitor of New
Jersey and Westchester County for suburban business, a
recent re-organization has already given more rapid and
cheaper long distance service, and very soon the old
engines and trains of the elevated roads are to be re-
placed by electric cars running on express train sched-
ules.

If, therefore, competition does remain in active
operation in some form or other, even in such cases as
these, is it not an idle fear that it can ever be abolished
in all the open and not naturally monopolistic industries?
There is no reason whatever to suppose that the whole
field can ever be monopolized in any line of industry.
It may be comparatively easy to combine half^or three-
fourths of the large establishments in an industry, but
it is immensely difficult to get a much larger'proportion.
The difficulty doubles and trebles with every new step
toward the hundred per cent, mark, until further effort

1899.] PO WERS AND PERILS OF THE NEW TRUSTS 451

becomes altogether more costly than it is worth. It is
like the old catch-problem of finding how long it would
take to reach the end of a road by traveling half the
remaining distance every hour. Progress at first is
rapid, but obviously it is impossible ever to reach the end.
But even if the amount of actual competition is re-
duced to very narrow limits, the possibility of new com-
petition always exists; and, as we have pointed out, its
probability increases with every increase in the surplus
capital of the community. This is potential competi-
tion, and as industry becomes organized on a large and
finely balanced scale it is not one whit less effective than
the actual. Another important point is this: — potential
competition, especially with respect to small employers
and wage earners, is far more merciful and humane
than when the warfare is actually on. We are forever
hearing competition exalted and glorified almost as a
sacred institution, of inestimable benefit to the entire
community, but as a matter of plain, hard experience,
it is only a part of the results of competition that is
really beneficial. Its actual working, as between a
multitude of small rivals, is attended with all manner of
heartlessness and immorality, failure of employers and
discharge of employees. The trust movement is tending
to abolish these painful features by gathering the bulk
of the concerns in various industries into large and per-
manent organizations. As these become thoroughly
unified, the plants they control will have to keep in
operation, some way or other, like railroads, however
the management may change. At the same time, by
the force of potential competition, the eagerness of idle
capital, and the threat of new inventions in the hands
of outside parties, we shall get the benefit of cheaper
commodities the same as if the competitive struggle and
slaughter were actually going on. The present move-
ment in both these directions is tending, at least, to

452 GUNTON'S MAGAZINE [June,

give us an industrial system as nearly ideal as seems
within the range of economic possibility.

The wage earner will not be injured. Alongside
the organization of capital conies organization of labor,
and this means more and more that industrial peace is
absolutely necessary to the success of large concerns.
As we have pointed out in another connection, the
larger they become the greater the necessity of smooth
operation and the more disastrous is interruption or
strife. A prolonged strike or shut-down would be al-
most ruinous to very large concerns, while giving com-
petitors a free hand in building up a rival business.
This fact makes it more and more important to grant
the reasonable demands of labor. Trade union organi-
tion in the hands of the laborers is a more effective
weapon against large concerns even than against small
ones, because the penalty they can inflict is immeasur-
ably greater. Many large concerns appreciate this so
keenly as to forestall trouble by voluntarily granting
wage increases. This has been very conspicuous, lately,
in the case of the steel, tin plate and leather goods
trusts.

Nor is the man of small capital to be crushed. He
cannot, it is true, engage with much chance of success
in many of the old established lines of manufacturing
industry, but this by no means implies that he has no
opportunity for individual investment. On the con-
trary, the very growth of corporations and trusts opens
a broader field for a small investor than ever before.
Perhaps he cannot start a plant of his own, but he can
"buy stock, however small the amount, in any one of
hundreds or thousands of different enterprises and share
in its management. These opportunities constantly in-
crease. It is now possible for men of experience and
peculiar skill in any special direction to gather to-
gether the large or small accumulations of hundreds of

1899.] PO WERS AND PERILS OF THE NEW TR USTS 453

other people and carry on an industry that is much
more likely to be profitable to them all than if each
man tried to start a small business of his own. If a man
happens to be a poor manager, the fact of owning his
own little establishment is of no use or advantage to
him. It is much better to succeed as a joint owner,
employing trained and skilled management, than to
fail as the incompetent sole proprietor of one's own
business.

The fear that the trusts will finally control all
legislation is equally groundless. At first, a decade or
so ago, large corporations undoubtedly did exert a
powerful influence in controlling legislation in certain
directions, but the very fact that this was done in a few
instances caused so great a reaction in public sentiment
that the whole tendency has been to the opposite ex-
treme ever since. To-day legislatures vie with each
other in passing measures restricting the powers of cor-
porations or increasing their taxation, while it is almost
impossible for these concerns to get any legislation
definitely in their favor. It is only necessary to look
over the statute books throughout the country for the
last few years to verify this. Every year sees in-
creased anxiety on the part of legislators to make a
record for an ti- capitalist activity. There is not the
least reason to suppose that this tendency will diminish.
To just the extent that trusts fail to justify themselves
to the public, or attempt unscrupulous methods either
in business or in legislation, political hostility to them
will continue.

Finally, we come to face this bugbear of a great
universal trust which is to absorb everything and rule
us by its own sweet will. Here again a very simple
test reveals all the reasonable probabilities. Just as in
the case of the permanence and stability of separate
trusts, the limit to size and extension will be fixed by

454 GUNTOWS MAGAZINE [June,

the test of greatest productive economy. If it is found
that several different kinds of industries can be con-
ducted jointly more economically, and hence more
profitably to the owners and with lower prices to the
public, consolidation will go on to that point, but no
further. If a combination is formed, in which the
effort to handle two or more different kinds of indus-
tries under a single management proves more wasteful
and awkward than the old plan, it will break down.
New competition will be invited into the field, and
former conditions will return. As productive methods
become more and more highly specialized, and expert
management more and more a real science in each dif-
ferent field, separation of very unlike industries be-
comes even more necessary to good results than for-
merly. An expert in the sugar refining business, for
instance, if placed also in charge of piano making or
cotton manufacturing, would probably hamper both
those industries and perhaps before long render them
unprofitable by his bungling interference. It is impos-
sible for one mind to be supremely expert in three or
four different fields, and this simple limitation of human
capacity prohibits the universal trust.

Not even if the actual running of each business
were left to special experts, and only the general busi-
ness policy put in the hands of a joint committee, would
success always come. Different industries require
different general business policies quite as much as
different factory management. It would be hard to
imagine a more inviting field for competitors than one
in which, for instance, a miscellaneous collection of
industries such as oil refining, cloth manufacturing,
wheat growing, stock raising, railroad managing and
store-keeping were in operation under the joint direction
of one committee of managers, each with a different idea
of business methods. Such a combination would be so

1899-] POWERS AND PERILS OP THE NEW TRUSTS 455

grotesquely unnatural, cumbersome and inefficient that
it probably could not last six months. It would be a
more easy victim to innumerable outside assaults in
specific lines than even the sleeping Gulliver to the
Lilliputians.

Indeed, it is not altogether unlikely that after a
few years there may be a dividing up even of some of
the trusts already organized. Senator Depew, whose
opportunities for insight into general industrial condi-
tions are perhaps as broad as of any man in the
country, takes this view very strongly indeed, and
even believes that we shall finally return to the con-
ditions of a decade or more ago. This does not seem
very probable, except in the case of useless and un-
wieldy combinations; but it would undoubtedly be true
•of any attempt to unite a large number of wholly
different kinds of industries under one management.
The grouping of each industry by itself seems to be
the -natural point of greatest economic efficiency; but if,
in time, a real advantage is found in still wider combi-
nation along certain lines, that will come. These larger
trusts, however, would be subject to exactly the same
perils as we have shown exist at present. The difficulty
and danger of moving counter to public welfare in-
crease as the trust grows and exposes fresh points of
attack. The only protection to economic vulnerable-
ness is economic wisdom.

While the general trend of this whole movement
affords no ground for sensational alarms as to its conse-
quences, present or future, there are likely to be many
serious disturbances in its progress, due to the ignor-
ance or selfishness of individuals connected with it.
This is and will be true wherever a speculative ' ' corner "
is organized to force up prices; or wherever a set of
irresponsible brokers organize a highly over-capitalized
trust and sell out their holdings, leaving the concern to

456 GUNTON'S MAGAZINE

flounder around as best it may, and perhaps fail for
want of any real economic welding force within it.
This is true, too, wherever either corporations or trusts,
try to interfere with the legitimate organization of labor,
or to reduce wages and exact longer hours of labor.

The great duty of the hour is to discriminate be-
tween the movement itself and the follies of individual
bunglers. Most of the latter — * * corners " for instance — .
bring their own economic penalties more promptly
than any legislative ones that could be applied. In the
case of stock watering, if the increased capital does not.
really represent a corresponding earning capacity, fail-
ure is certain. A few more experiences of this ought
to be enough to prevent either the owners of industries
from transferring their plants or owners of capital from
loaning their money in aid of unsound reorganizations.
Where capital interferes with the right of labor to or-
ganize, the law might properly step in and provide
severe penalities for any attempt to black-list or intimi-
date wage earners, or break up their organizations, or
require them to forswear trade union membership as a
condition to employment. The duty of the public lies
in watching these points, not in passionately opposing
this great economic movement of society; which, as it
gradually rids itself of error and attains its full possi-
bilities will give us permanent industrial efficiency and
security. At the same time, the trusts must learn that
after all the public, as consumer, competitor and law-
maker, is the real and final master of the situation.
Whenever the people cease to share, and share liberal-
ly, in the benefits of this movement, its end is come.

H. HAYES ROBBINS.

SCIENCE AND INDUSTRY NOTES

In our March number we gave a complete list of

laws existing in the various states with reference to

Child labor hours of labor and employment of

law in children. To this should be added a

Nebraska new iaw recently enacted in Nebraska

prohibiting the employment of children under ten

years of age in factories or stores and providing that

children over ten years and under fourteen must

not be employed unless they attend school at least

twenty weeks during the year.

Our Consul-General at Calcutta, Mr. R. F. Patter-
Wages and son, sends to the State Department the
following table of monthly wages in
India:

Cost of Food
in India

Description

Bengal

Madras

Bombay

Able-bodied agricultural laborer

$2 1%

$1 80

&2 CO

Cotton mill labor :
Unskilled

2 OO

I 90

2 50

Skilled

4 5°

4 oo

c 50

Household servants

2 85

2 25

^ OO

Common masons, carpenters andblacksm'hs
Syce, or horse keeper

4 oo

2 OO

4 70

2 OO

7 50

2 5O

Railway labor :
Unskilled

2 OO

I 60

2 12

Skilled

4 20

4 oo

4 4°

Coolie labor

2 OO

i 90

2 25

The districts from which these figures are taken
include the great cities of Calcutta, Madras and Bom-
bay, and the wages are higher than elsewhere in India.
Statistics are also given showing the average retail
prices, during 1898, of the food grains consumed by
the laborers. Nine different kinds of grain are men-
tioned, including rice, wheat, barley and maize; fre-
quently several of these are cooked together, and the

457

458 GUNTON'S MAGAZINE [June,

quantity consumed by each person is about i y2 pounds
per day, costing on an average 2*^ to 3 cents. This
would be perhaps 75 cents per month, and it is clear
that a laborer who may have a family to support, rent
to pay, however low, and clothing to buy, however
cheap, is absolutely prohibited from sharing in any
phase of life beyond the interminable struggle for mere
physical existence. We are assured, however, by
recent prophets of Buddhist philosophy as the coming
regenerator of the race, that this barbaric condition is
favorable to high spiritual development; and, indeed,
there are some who actually seem to believe it.

Not long ago the United States Department of

Labor made an investigation of the economic aspects of

Economic Con- the li(luor problem. Without discussing

centration in here the question of the social and moral

the Liquor effects of the liquor business per se, there

is one point of purely economic interest

brought out in this investigation which is well worth

noticing. It has to do with the effects of industrial

combination upon wages and employment. The report

furnishes one concrete illustration, at least, of the results

that follow this concentrating movement sooner or later

in practically all industrial experience.

The figures collected by the Department cover the
period from 1880 down to 1896, but the " statistics to
which we now have special reference are shown only for
the years 1880 and 1890. In 1880 the number of estab-
lishments engaged in the manufacture of alcoholic
liquors in the United States was 3,152; in 1890, 1,924.
Notwithstanding this decline in the number of concerns,
the total capital employed increased from $118,037,729
in 1880 to $269,270,249 in 1890. In other words, the
average capital per establishment increased from $34,434
to $139,953 in the decade.

I899-] SCIENCE AND INDUSTRY NOTES 459

This, of course, means that the movement towards
consolidation of small into large establishments has
been going on in the liquor industry as in so many
others. As will be seen, this involved the closing of a
considerable number of establishments; or, in many
cases, no doubt, combination of the plants of smaller
concerns with those of larger. The popular feeling and
belief on this matter is that the closing of establish-
ments or absorption by others means permanently
throwing large numbers of workingmen out of employ-
ment and reducing the wages of those that remain.
That this is absolutely untrue has been demonstrated
by various official and other investigations of the course
•of modern industry. The usual result of consolidation
is such an increase in the business that the number of
employees, instead of being diminished, is actually en-
larged within a short time. Not only the men tempo-
rarily discharged at the time of the consolidation, but
additional supplies of labor, are ultimately required in
the same identical industry.

This fact is entirely borne out in the case we are
citing. Although the number of industries decreased,
the total number of employees increased from 33,689
in 1880 to .41, 42 5 in 1890. The total wages paid in 1880
amounted to $15,078,579; in 1890, $31,678,166. In
other words, the average wages per employee increased
from $444 to $764 per annum, while at the same time
the number of employees increased nearly 25 per cent.

Another result was a great increase in the aggre-
gate product of the industry, the total value of the out-
put in 1880 being $144,291,241, and in 1890 $289,775,-
639. Of course, it goes without saying that this does
not represent increased price of the product, but a very
much larger total output; in other words, a larger con-
sumption,— which in the case of almost any other
product of industry would represent just so much

46o GUNTON'S MAGAZINE

distinct social gain. The economic tendency of indus-
try in general is shown by this just as clearly, however,
though the particular illustration now happens to be-
liquors instead of cloth, shoes, sugar or oil. The total
value of product in 1890 was made up as follows:
wages $31,678,166; raw materials, $80,230,532; miscel-
laneous expenses, including rents, taxes, special in-
ternal revenue taxes, insurance, repairs, interest on
cash used in business, and sundries, $113,726,594;
leaving $64,140,347 of economic surplus in the form of
interest and profits.

To summarize, the net results of the process of
consolidation have been, first, — fewer concerns with
larger capitals; second, — a larger total number of em-
ployees; third, — an increase of almost 75 per cent, in
the average wages per employee; fourth, — a great in-
crease in the total output of product; and fifth, — no-
decline apparently in the profitableness of the business;
or, if there has been such a decline, certainly the rate
of profit realized in 1890 is not one to give any cause
for complaint as to the possibilities of the business,
however closely pressed some of the less favorably
situated producers may have been. In other words,
there was a substantial gain at every point, and it came
entirely out of nature as the result of the improved
methods of manufacture and the consolidation and
better management of the industry. And, it is to be
remembered, given similar conditions economic laws
work out similar results, sooner or later, in all lines of
industry, whether or not the showing for any particular
period is quite as marked as in this particular case.

CURRENT LITERATURE

" CROOKED" REASONING ON TAXATION*

The most formidable contribution to single tax
literature since the death of Henry George is a book on
"Natural Taxation" by Thomas G. Shearman. Mr.
Shearman is not a single taxer in the sense that Henry
George was; he is a free trader of the most extreme
type, and espoused the single tax doctrine as an instru-
ment of laissez faire. He appears to have the faculty
of assuming that for things to be made plain they must
be greatly magnified. The real character of the book
is clearly revealed in the first thirty-eight pages, five
of which are devoted to charging all the ills of mankind
to bad taxation, and the remainder to denouncing
" crooked taxation," which is his vicious name for in-
direct taxation. And, it is safe to say, thirty pages of
more " crooked " reasoning it would be difficult to find
anywhere. Here is a sample of his method of discus-
sion (pp. 8-9): It tends "to make the rich richer, and

the poor poorer to force into existence a class

of wealthy men, whose income depends upon legalized

robbery It is crooked in its operation, crooked

in its form, crooked in its motives, crooked in its aims,
crooked in its effects, and, as fits a system inherently
crooked, it is especially crooked in its influence upon
the well-being of society .... It never arrives at the
point which is its professed aim, and it is never meant
to arrive there by those who control it. It never pro-
duces the chief results which are expected from it, even
by its inventors, and it never produces any of the re-
sults which they publicly profess to expect from it,

* Natural Taxation, by Thomas G. Shearman. Doubleday &
McClure Company, New York. Cloth, 268 pp. $1.00.

461

462 GUNTON'S MAGAZINE [June,

except in rare cases, in which their secret calculations
are entirely at fault."

Of course it can hardly be expected that a person
who can reel off that sort of thing could discuss with
fairness any phase of a public question which did not
meet his fancy. Like most single tax advocates, how-
ever, he seems to have no definite idea of what con-
stitutes the distinction between direct and indirect tax-
ation. While violently denouncing indirect taxation
as being all that is wicked, he advocates a single tax
levied exclusively upon land under the evident delusion
that a tax on land is a direct tax, whereas it is the
most indirect of all taxes.

If there is any meaning to economic terms, a di-
rect tax is a tax which is wholly paid by those upon whom
it is originally levied, a tax that cannot be shifted. A
tax on anything that is bought and sold can be shifted.
It is only a tax falling on property that is not sold that
is non-shiftable. Land being the source of the pro-
duction of all salable commodities, a tax levied on land
will adhere to the value of the products in exactly the
same way as will any other item of the cost of produc-
tion. As often pointed out in these pages, a tax on
land and other real estate is probably the most equita-
ble of all the taxes, solely because it is the most in-
direct. Its very indirectness insures the equitable dis-
tribution of the tax throughout the community, a dis-
tribution which takes place not by any wisdom of the
assessors but by the silent imperceptible movement of
unconscious economic distribution.

In the chapter on " Crooked Taxation," Mr. Shear-
man indulges in so much that is extravagant and un-
real that it might readily be assumed that the remaind-
er of the book is not worth reading. Yet this would
not be true. There is much that is good in the book,
though almost everything that is bad in this chapter.

1899-1 "CROOKED" REASONING ON TAXATION 463

Protective tariffs, about which he thinks nothing
too vile to say which is not too shocking to print, he as-
serts are secured by open and flagrant bribery of voters,
purchase of congressmen and debauchery of the public, —
as if the American people had never voluntarily voted
for a protective policy. After dealing in this kind of
indiscriminate denunciation, he proceeds to construct
some tables showing the colossal burdens heaped upon
the people by indirect taxes, the basis of which is most-
ly colossal guessing.

To illustrate, he says (page 33): ''Labor commis-
sioners have repeatedly inquired into the savings of
laborers, with the result of fixing these at not more
than 5 per cent, of such incomes under $500, after all
taxes have be en paid. As taxes consume, directly and
indirectly, at least 1 5 per cent, of a laborer's average
income. . . " — etc. Now, it is impossible for any labor com-
missioner accurately to have fixed the savings of labor-
ers at 5 per cent. , for there are no data of their savings.
Savings bank deposits are frequently referred to as
representing the savings of laborers, but nobody knows
better than Mr. Shearman that they represent nothing
of the kind. In exposing the fallacy of this claim, on
one occasion, Mr. Shearman stated that his own wife had
six savings bank accounts, in as many institutions. A
careful investigation has shown that but a small propor-
tion of savings bank deposits belong to wage laborers.

His statement that "taxes consume, directly and
indirectly, at least 1 5 per cent, of a laborer's average
income," is another guess. He doubtless makes this
assumption on the ground that laborers consume some
taxed articles; if he has any means of knowing how
much that is he does not indicate the fact. But even
if it were true that taxes add exactly fifteen per cent,
to the price of all the laborers consume, that would not
prove that this was ultimately paid by the laborers.

464 GUNTOWS MAGAZINE [June,

One might as well say the import duty on sugar is paid
by the importer or grocer; it is not; they shift it. In
the long run the laborers shift the addition to the price
of the articles they consume, with about the same accu-
racy as sellers of commodities. Economic forces work
with as much accuracy in adjusting the price of labor
as of sugar, cloth, iron or steel. This has been demon-
strated by experience over and over again, in periods
of fluctuation in the price of commodities which enter
into the laborers' living.

Even so arbitrary a monarch as Henry VIII was
unable to evade the consequences of this economic law.
By debasing the currency he cut the purchasing power
of the shilling in two, but he could not make the new
shilling buy more than half the old one. Prices doubled,
and so did wages. For thirty years before the debase-
ment of the currency wheat averaged 8s. 7>^d. per
quarter, and wages were 2s. icd. a week. For the
thirty-two years after the debasement the price of
wheat averaged 153. 8d. and wages 45. /d. The same
effect was produced during our civil war by the depre-
ciation of the greenbacks. As the money fell in pur-
chasing power prices rose, and as the prices rose wages
followed, and, conversely, as the value of money rose
toward par (1865-1879) prices fell and wages declined
with the prices. In this way a large part of the taxes
is shifted by laborers as effectively as by manufacturers
and shopkeepers.

Part of his method in rolling up this mountain of
burden, to look at which is enough to make every
laborer feel that he is a pauper, is to assume that all
tariff duties are added to the prices of commodities,
and also a profit on the duty, so that the effect is
swampingly cumulative. To make this appear to good
advantage, he takes pottery as an example; an industry
in which there is a tremendous cost in handling,

i899 ] " CROOKED" REASONING ON TAXATION 465

through breakages. He says: "The nominal profit of
dealers is rarely as low as 50 per cent. This profit is
charged, as a matter of course, upon the duty as well as
upon the cost. " This sort of reasoning makes one take
a long breath. Of course, the handling of earthenware,
or articles that are very perishable, is a part of the cost
of the production of these articles. It may be true that
in order to cover the breakage in handling fine glass-
ware in retail trade it is necessary to put the retail price
at double the factory cost, just as it is necessary for the
grocer in selling strawberries to allow for the cost of a
few spoiled boxes. To assume, because in the handling
of a particular article where breakage makes the difference
in cost of production between the factory and retailer
very great, that therefore a profit of 50 per cent, is
added to the duty upon this and other products, is
really more like ranting than reasoning. If the dealers
can add 50 per cent, profit on what they pay as duty,
why cannot they add 50 per cent, on what they pay as
cost of production ? They would be glad enough to do
it, but competition would prevent any such bonanza-
creating device. The importer can no more add 50 per
•cent, profit on the duties he pays than he can command
50 per cent, profit on any other investment.

Still another item in this monument of burden is
made by assuming that the price of domestic protected
goods is increased to the full amount of the duty im-
posed on the imported goods of the same class, an
assumption which is flatly contradicted by the facts.
Take, for instance, wool. There is to-day an import
duty of eleven cents a pound on wool in the fleece, and
the Boston Herald and Springfield Republican and other
free trade papers are declaring that protection is a
failure because the price of wool is no higher here than
in London. During the entire period of the McKinley
tariff, with the exception of a month or two at first, the

466 GUNTON'S MAGAZINE [Junev

increase in price was never equal to the duty, and the
average increase for the whole period was not one-
fourth the amount of the duty, being less than three
cents a pound, while the duty was twelve cents.

As we have pointed out many times, there are some
instances, where the product is nearly all from abroad
as in the case of raw sugar, in which the duty will all
be added to the price. There are cases, as Bermuda
potatoes and Nova Scotia coal, where none of the duty
is added to the price, the obvious reason being that the
duty is not equal to the difference in the Bermuda or
Nova Scotia cost of producing, and our own. In other
cases, where the cost of production is higher here, but
not as much higher as the amount of the duty, as for
years has been the case with wool and other products,
part of the duty is added to the price and part paid by
the exporting country.

With this economic movement Mr. Shearman seems
to be wholly unacquainted, but on the a priori assump-
tion that all the duty is added to the price and that it
is added to all equivalent articles produced in this coun-
try, which is obviously untrue, he constructs anothei
table (p. 27). In this table he gives the import duties,
as $186,500,000, the increased price on domestic pro-
tected goods as $559,500,000, to which he adds " Deal-
ers'profits, $134,000,000," and so with the rolling up
of various imaginary data he gets a grand total of $i,-
354,600,000 of oppressive burden by so-called "crooked
taxation." On the whole, this chapter reveals a highly
inflamed state of mind, the utterances of which cannot
be taken seriously.

Passing from indirect taxation, which is to Mr.
Shearman like a "red rag to a bull," he turns to the
taxation of personal property. Here he appears to much
better advantage. He thoroughly exposes the zigzag
and inequitable working of the different forms of per-

1 899.] " CROOKED" REASONING ON TAXA7 ION 467

sonal taxation. Even here, however, his dogmatic at-
titude and lack of close scientific thinking reveals itself
in statements like this (p. 58): "Coin, like all other
money is nothing but a representative of wealth, an
order for wealth, which everybody honors; but not
wealth itself." If an ounce of gold, in whatever form
it is put, is not wealth, pray what is it? Wholly inde-
pendently of any use as money, gold, whether in the
English sovereign or the America eagle, is pure com-
modity. Nothing but the fact that it is wealth makes
it useful as a monetary standard. The mere coining of
it does not detract one iota from its wealth quality.
But, despite a few such defects, his criticism of the
taxation of personal property is thoroughly effective
and well worth reading.

The remaining 145 pages are devoted to the virtue
of the single tax. On this subject it must be admitted
he makes an altogether more feasible proposition than
did Henry George. He repudiates the doctrine laid
down by Henry George that the tax should take all the
rent, simply because the rent exists and not because
the public needs the revenue, and insists that while the
tax should be levied on rent the amount should be de-
termined by the public need of revenue. In changing
the basis of the tax from the mere motive to confiscate
rent to the motive to collect the revenues for needed
public improvements, Mr. Shearman really changes the
single tax from the doctrine of confiscation to one of
economic taxation.

He opens this part of his discussion by endeavoring
to show that improvements should not be taxed,
but only the original land values. In his effort,
however, to distinguish the value due to improve-
ments from the original value of the land, he musses
and muddles very badly. He several times shows signs of
realizing the difficulty of this task.but cuts the knot in his

468 GUNTON'S MAGAZINE [June,

usual easy fashion by some good round assumption,
such, as, for instance, that the value of land is 60 per
cent, of the value of real estate in the community.
Well, suppose it is. How has that land become valu-
able? It had no value once. Clearly its value is due
to direct or indirect improvements which have become
an inseparable part of the land. But he says all farms
have some uncultivated land, and the value of this un-
cultivated or unimproved portion constitutes the stand-
ard by which all unimproved land may be judged. He
seems to forget that the unimproved part of the farm
acquires value by the improvements in roads and other
improvements on portions of the farm of which it is a
part. If this unimproved land were away from all
highways and improved land and farming facilities, it
would have no value. Then it would constitute a
proper standard for judging unimproved land. To as-
sume that a piece of virgin land surrounded by im-
proved farms with good highways and fences and police
protection does not acquire value from such improve-
ments is to fail to recognize the chief elements of real
estate value in modern society. There are building
lots in New York city that are now huge masses of
rock, which it will cost an immense sum to remove
before the land can be used, and yet the lots have a high
value. How did they acquire that value? Simply, it
was conferred by improvements in streets and high-
ways and sewerage on the property by which it is sur-
rounded. Land value does not consist exclusively in
what exists literally on the particular piece of ground.
Surrounding conditions, which furnish access and pro-
tection to the land for any use, are a part of the im-
provement of that land, and it is from these improve-
ments that it acquires its value. In short, the value of
so-called unimproved land is largely reflected value
from improved land.

I899-] "CROOKED" REASONING ON TAXATION 469

Then, in order to show that this method of taxa-
tion would even lighten the burden of farmers, not to
say manufacturers and traders, he re-introduces the
fabulous figures he called into existence in his
"crooked" chapter on taxation. If Mr. Shearman had
continued the rational attitude he assumed when con-
tending that the single tax should be levied not for the
purpose of confiscation but solely for the purpose of
revenue, and had applied himself strictly to showing
the economic wisdom of simplifying taxation by reduc-
ing it as nearly as possible to one tax, and that on land
and real estate, he would have had a strong case. But
when he undertakes to argue that the tax shall not only
be on land, but that it shall be confined to the original
value of the land, apart from improvements, he con-
fuses the subject and forces himself into a lot of special
pleading which leads to untenable assumptions and
absurd contentions and impracticable propositions.

On the whole, Mr. Shearman's book is well calcu-
lated to stimulate the narrow thinking and impulsive
attitude of single tax advocates. There are indeed some
excellent features in it, but it is so handicapped with
sweeping assumptions and special pleading as to make
it of doubtful value to the careful student who desires
accurate statement and scientific reasoning on the sub-
ject.

ADDITIONAL REVIEWS

THE SANTIAGO CAMPAIGN, 1898. By Major-Gen-
eral Joseph Wheeler. Lamson, Wolffe & Company,
Boston. Cloth, 369 pp. $3.00.

This book is useful as giving what we may reason-
ably assume to be a reliable narrative of the one cam-
paign fought in Cuba during the Spanish War. What-
ever popularity the volume may attain, however, will
be due chiefly to the personality of the author. An
ex-confederate general, and a very prominent one too,
thirty-five years later becomes the historian of a cam-
paign fought and won by United States troops of which
he himself acted as one of the commanding officers.
This is the unique circumstance that attracts attention
to the book. It is typical of the national reunion
which, having slowly progressed during many years by
the intertwining of economic interests, became actual
in sentiment as well through the incident of war
against a common enemy.

Wheeler was serving as congressman from Ala-
bama when, on the 2d of May, 1898, he was appointed
a major-general in the United States Army, and im-
mediately thereafter ordered to the front. He was an
important figure in the entire Santiago campaign, so
far as the land forces were concerned; and in this book
he describes in detail the military operations from the
landing at Daiquiri on June 23d to the surrender of
General Toral on July i6th. He also gives the history
of Camp Wikoff, of which he was in command after
the return from Cuba.

His narrative is largely in the form of a daily jour-
nal, liberally interspersed with official orders and re-
ports. Indeed, the last third of the volume consists en-
tirely of " Dispatches on the Field," which the author
considers sufficiently important to publish, since, as he

470

ADDI'1 1OXA L RE V '! '£

47i

says, they ' ' form by themselves a continuous official
story." There are several large maps illustrating the
operations about Santiago, and an excellent likeness of
General Wheeler forms the frontispiece.

STORIES OF THE OLD BAY STATE. By Elbridge
S. Brooks. American Book Company, New York,
Cincinnati and Chicago. Cloth, illustrated, 284 pp.
60 cents.

This is a delightful little volume for young people.
It seems to fill the function of a straight, undisguised
story book quite as satisfactorily as that of a prelimin-
ary text-book in American history, and so is as fascinat-
ing as it is useful. Stories of the Old Bay State are
bound to be stories of perennial interest to every Amer-
ican youth. They seem like a personal inheritance, al-
most as much as the grandfather's tales of every really
American family fireside. They tell of the place and the
men and the thrilling experiences associated with the
building up of most that has been distinctive, forceful
and permanent in American character and greatness. As
the author says in his preface : ' ' The Old Bay State has
built itself into the very bone and sinew of the Repub-
lic. Interests throughout our land are too often local,
and loyalty is too apt to be merely civic pride; but the
story of Massachusetts, as it is known to all Americans,
is dear to all, for it is, to a certain extent, the story of
America."

Thirty-two of the important events and movements
that stand out most conspicuous in Massachusetts his-
tory are described under headings sure to be attractive
to any American boy, such as: "How Captain Miles
Standish met the Indians," "How William Pynchon
Blazed the Bay Path," "How the Old Bay Colony led the
Van," "How the Codfish came to the Statehouse,"
"How the 'Old Man Eloquent' Won the Fight," and so

472 GUNTON'S MAGAZINE [June,

on. The stories are so written, however, as i.o form a
fairly continuous narrative, from the time of the Pil-
grim Fathers down to the story of the invention of the
telephone by Alexander Graham Bell, who is described
as "The Man who set the World a-Talking." Probably
not one in a hundred of the strangers who have visited
the Boston State house, and been interested and per-
haps amused at the strange spectacle of a great wooden
codfish hanging over the speaker's chair, ever had the
least idea how and why it came to be there. A codfish
invested with the pomp and dignity of state is an odd-
ity that piques the curiosity just enough to make Mr.
Brooks' account of it worth repeating:

"And when victory at last came, when the indepen-
dence of America was won, and, in the year 1784, across
the seas in Paris, brave John Adams, in the teeth of
British opposition and French indifference, saved the
fisheries of Massachusetts for the people of Massachu-
setts, to whom they meant so much, — then it was that
John Rowe rose in his place in the Great and General
Court, of which he was a member, and moved that
'leave might be given to hang up the representation of
a codfish in the room where the House sits, as a mem-
orial of the importance of codfishery to the welfare of
the commonwealth;' and 'leave' was unanimously
given.

"Then Captain John Welch, of the Ancient and
Honorable Artillery, carved out of a solid block of wood
a great codfish, four feet and eleven inches long, — big
enough even to satisfy Captain John Smith's fish stories.
And when it was painted it was duly suspended in the
representatives' chamber in the Statehouse at the head
of State Street, and John Rowe paid the bill.

' ' So the codfish came to the Statehouse of Massa-
chusetts, and in the Statehouse it has staid to this day,
suspended either above or facing the Speaker's chair.

i899.] ADDITIONAL REVIEWS 473

. . . ..•} 'Nothing about the grand Statehouse on the
hill is more interesting, nothing is more suggestive."

Mr. Brooks concludes his little volume with a well-
put tribute to Massachusetts, in which he quotes the
familiar opening sentence of the finest eulogy ever pro-
nounced on any commonwealth. In a sense encomiums
are superfluous, however, for, as Webster said of Mass-
achusetts in that great address: "She needs none.
There she stands. Behold her and judge for yourselves.
There is her history; the world knows it by heart. The
past, at least, is secure."

NEW BOOKS OF INTEREST

(Note. — By an oversight, in our mention of "Field,
Factories and Workshops," by P. Kropotkin, last
month, we failed to specify the publishers, — Messrs.
Houghton, Mifflin & Co., Boston, New York and Chi-
cago.

BIOGRAPHICAL

The Life of Nelson. The Embodiment of the Sea Power
of Great Britain. By Captain A. T. Mahan. Cloth,
75opp. Illustrated. $3.00. Little, Brown & Co., Boston.
This is the popular edition of Captain Mahan's well-
known work, which convinced even England herself
that America had furnished the only really great histor-
ical exposition of Britain's maritime greatness.

Lord Clive. The Foundation of British Rule in India.
By Sir Alexander John Arbuthnot. Longmans, Green
& Company, New York. Cloth. 318 pp. $1.50. To
this book must be credited all the increased interest
that attaches to an historical subject when written from
the standpoint of the great individuals connected with
it. Moreover, a work on the foundation of British rule
in India is particularly significant in a period that is
perhaps marking the foundation of American colonial
experiments in the same quarter of the globe.

474 GUNTON'S MAGAZINE

HISTORICAL AtfD DESCRIPTIVE

The Rough Riders. By Theodore Roosevelt. Cloth,
8vo. With 40 illustrations and photogravure of the
author. $2.00. Charles Scribner's Sons, New York.
This book, written at intervals during actual military
service, the heat of a political campaign, and delivery
of a series of lectures in Boston, bears testimony to the
author's remarkable capacity for hard work. It relates
graphically the story of one of the most picturesque and
popular features of the war, from the raising of the
regiment to the breaking-up at Camp WikofT.

Porto Rico and the West Indies. By Margherita Ar-
lina Hamm. F. Tennyson Neely, London and New
York. Illustrated. Cloth. 230 pp. $1.25. This
book contains the record of the author's personal obser-
vations and experiences during two visits to the West
Indies, one just before and one during the late Cuban
rebellion. In it she has embodied a considerable
amount of information regarding the fauna and flora of
the islands described.

ED UCA TIONA L A ND PHIL O SOPH 1C A L

Walker s Discussions in Education. By the late
Francis A. Walker, President of the Massachusetts In-
stitute of Technology. Edited by James P. Munroe.
Henry Holt & Co., New York. 8vo. 342 pp. $3.00.
This is a collection of Dr. Walker's essays on education,
never before published in book form. A general idea
of the subject matter may be gained from the sub- heads
under which the papers are grouped, viz: Technological
Education, Manual Education, The Teaching of Arith-
metic, College Problems and "A Valedictory."

The Gospel According to Darwin. By Dr. Woods
Hutchinson. The Open Court Publishing Co. , Chicago.
Cloth. 241 pp. $1.50. As the title indicates, this is
a treatment of religious and ethical problems from an
evolutionary standpoint; laying the emphasis on social
progress rather than individual salvation.

THE BEST IN CURRENT MAGAZINES

The Atlantic Monthly includes in its table of con-
tents for June the following: " Japan and the Philip-
pines, " by Arthur May Knapp ; ' < The Outlook in Cuba, "
by Herbert Pelham Williams; " Brooklyn Bridge," by
Charles G. D. Roberts, author of a " History of Canada/"

R. H. Stoddard has an article on John Greenleaf
Whittier in the June Lippincott's Magazine. '

In the New England Magazine for June is a discus-
sion of " William Morris's Commonweal," with illustra-
tions, by Leonard D. Abbott; also an article with the
suggestive title: " Liberty through Legislation," by
Joseph Lee; and an illustrated description of " New
England's First College out of New England " (Hamil-
ton College), by E. P. Powell.

Dr. Henry van Dyke opens the June number of
the Century Magazine with an illustrated article entitled
" Fisherman's Luck." Prof. Benjamin Ide Wheeler
reaches the eighth paper in his biography of Alexander
the Great, describing this month ' * Alexander's Might-
iest Battle." Other contributors are Frank R. Stock-
ton, Hamlin Garland, Ruth McEnery Stuart and Gus-
tav Kobbe. This is a special " Out-of- Doors Number."

Marconi's recent experiments in wireless telegraphy
are described by Cleveland Moffett, with Marconi's as-
sistance, in the June McClure's. This number also has
an article on the life of the Cornwall miners, who work
in shafts that extend under the ocean sometimes a mile
from the shore.

The story of " A Sled Journey of Sixteen Hundred
Miles in the Artie Regions " is told by Lieutenant Ells-
worth P. Bertholf, U.S.R.C.S., in Harper s Magazine
for June. This number also contains a review of ' 'The
Century's Progress in Scientific Medicine," by Henry
Smith Williams, M.D.

475

INSTITUTE WORK

ANNOUNCEMENT

In our May number the course in social economics
and political science, commenced in October 1897, was
completed. Next October the course in social econom-
ics will be resumed, but the lessons will appear weekly
in the GUNTON INSTITUTE BULLETIN, instead of monthly
in the Magazine, and will be entirely revised and rear-
ranged. The department of Institute Work will not,
therefore, appear again in GUNTON'S MAGAZINE; but we
shall devote the space to a larger variety of matter in
the other departments. It is believed that this will be
a distinct improvement both in the Magazine and in
the system of conducting the Institute study courses.
Full particulars of the course for 1899-1900 will appear
later in the season, and it is urged that all our friends
interested in this important educational work send in as
many names as possible of people to whom copies of the
prospectus and curriculum might appropriately be sent.

TIME EXTENDED FOR PREPARING THESES

On account of unexpected delay in the publication
of the May Magazine, it has been decided to extend the
time for completion of theses, to be sent in by students
in the course on political science, from June ist to July
i st. We take this opportunity of again urging upon
all our students the importance of this work. It is val-
uable for review and test purposes; it takes the place of
a written examination, and without it we can grant no
certificate. The list of subjects from which selection
may be made was printed in the May Magazine, to-
gether with particulars as to length of theses, etc.
Should any student desire to write on a topic not in-
cluded in the list given, or require additional time,
special application should be made to this office.

476

QUESTION Box

The questions intended for this department must be accompanied by
the full name and address of the writer. This is not required for publica-
tion, but as an evidence of good faith. Anonymous correspondents will
be ignored.

Editor GUNTON'S MAGAZINE: — Do you not think it
will more truly advance the interests of liberty and
civilization for us to govern the Philippines than if we
leave them to be governed by the despotic leaders of
barbarian tribes ?

Brooklyn .

That depends altogether on how the despotic
leaders of barbaric tribes gain their authority. At
present the country is in a state of revolution, and the
leaders probably are not the wisest statesmen, as they
seldom are in revolutions, but the most hot-headed
fighters. As a matter of fact, it is very doubtful
whether we Americans know any more how to govern
barbarian Filipinos wisely than we would how to gov-
ern ancient, solid and superstitious China. We may
know how to kill them, as we have the Indians, but
the difficulty now is that we have broken all their
ties from their previous state of government. The
Filipinos are not now as they were before we dis-
lodged the Spanish. We have made the problem more
difficult to deal with. We have practically burned the
bridges between the Filipinos and any established gov-
ernment that they know anything about. Now the
question for us to decide, after peace is established, is
whether, under our power of protection to persons and
property, a government cannot be evolved among the
Filipinos themselves that would be more in accordance
with their character and traditions and customs, and
more thoroughly command their confidence, than even
a better government were it superimposed by the
United States, administered by American generals
and politicians. The probability is that, if we are

477

473 GUNTON'S MAGAZINE [June,

wise enough, the former would be altogether a bet-
ter policy. Our authority there should be limited to
the preservation of order, and protection of life and
property. If they want a monarch they should have
one. If they want to worship suns or serpents or heaps
of gold, or wear gold whistles, in these respects they
should have their own way. It is none of our business,
and interference on these matters would not enlighten
them, but rather tend to enrage them. If we really
want to Christianize and civilize the Filipinos we must
first industrialize them, and give helpful direction to all
the forces that will make for peace and industry. As
they learn to consume more wealth and pursue larger
fields of industry, they will begin to have higher ideas
of personal rights and new concepts of integrity and
morality, and with the growth of these elements of
character will come the capacity for liberal self-govern-
ment, and not before. But we can make them neither
free, rich nor good, by simply imposing upon them the
American form of government and authority.

Editor GUNTON'S MAGAZINE: Dear Sir: — You
have said very often in your magazine that laborers get
in wages only the equivalent of their cost of living. If
this is so, how can any of them save anything ? Yet
the deposits of the savings banks of the country chiefly
consist of workingmen's wages.

Student, New York City.

Our correspondent is mistaken in assuming that the
deposits in the savings banks chiefly consist of working-
men's wages. Probably not half of them consist of
workingmen's wages. These deposits consist in large
part of the savings of people who do not work for wages
but who want to deposit their money with the minimum
risk and maximum interest. Savings banks give a
larger rate of interest than government bonds, and for

i899.] QUESTION BOX

479

the most part larger than on any other form of invest-
ment where the owner can withdraw on demand ; for,
while savings banks usually have the right of ninety
days' notice, they seldom exercise it except under con-
ditions of financial excitement when a ' * run on the
bank " is threatened.

But the first part of the question, how can laborers
save at all, is just as pertinent if only a quarter of the
deposits were from wages. When we speak of laborers'
wages being only equivalent to their cost of living, we
mean just what is meant when it is said that the price
of any commodity is only equivalent to the cost of pro-
duction. If this were true of every portion of a product,
every ton of coal or iron or every hundred yards of cloth,
it is quite clear there could be no profits. It is also quite
clear that if all laborers' wages were only equivalent to
their cost of living, there could be no savings; but that
is not what is meant. Everybody knows that the cost
of all laborers' living is not alike. Some people live on
much less than others, for various reasons. Everybody
knows that the cost of making shoes or cloth or iron is
not the same in every factory or furnace. Some can
produce at a trifle less than others. When we say the
price is only equivalent to the cost of production, it is
always understood or should be understood to mean
the cost of the dearest portion, or that whose expense
in production and marketing is the greatest. All that
produce at less than this have the difference as profit,
and that is why Carnegie's profits are very much larger
than some of the smaller iron and steel manufacturers',
some indeed who have no profits at all. That is why
the sugar trust's profits are greater than those of the
small refiners, because by their superior organization
and machinery they can produce at less cost per pound
than the small concerns, and the prices can and will be
kept up to what is substantially equivalent to the cost

48o GUNTON'S MAGAZINE

of those small ones, who cannot keep in the business
unless they get what will at least recompense them for
their outlay.

It is exactly the same with wages. American la-
borers, who insist on having decent houses and modern
furniture and some degree of comforts in their home
life, must have a certain standard of wages, and if for-
eigners from Germany or Russia or any other country
come and work at the same bench, even though they
have been accustomed to live on perhaps half of what
has become the habitual custom of the American la-
borer, they will get the same wages, because the rate of
wages is kept up by the standard of living of the Ameri-
can laborers, which is much higher than their own.
Hence, of course, the foreigner can save. It is in this
way that the savings banks contain deposits of wage
workers. It is a peculiar fact that there are very many
more foreigners than Americans among wage workers
who have savings banks deposits, and it is because they
get a rate of wages determined by the cost of a standard
of life higher than their own. In short, wage deposits
in savings banks are entirely consistent with the theory
that wages are only equivalent to the cost of the labor-
ers' living, always meaning the cost of the dearest por-
tion of the laborers in the given class or group.

m

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